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On Tuesday, President Barack Obama will visit yet another American business to talk about the future of American job creation in his on-going quest to define Obama's Economy. A survey of his past such visits suggests almost no effect on those business sectors — but a small effect on stock prices.
Over the course of his time in office, Obama has visited at least 46 other American businesses, with the goal of presenting his outlook on where future job and industry growth is or should be. On Tuesday, Amazon and its 5,000 new shipping warehouse jobs become the latest focal point.
But how does that stack up against the actual economy? In an overview done by The Atlantic Wire, of the 47 businesses Obama has visited during his presidency, over a third of them fall into general manufacturing and another third and change are related to green energy — like the making of wind turbines, solar power, and electric vehicles. That data is in the chart below.
It's no surprise that these two industries have gotten particular attention from the administration, which put a lot of money into these sectors as a part of the stimulus package. Of those traditional manufacturing companies, six of them were big American car companies. The stimulus also allotted $90 billion for clean energy.
But, compared with the actual economy since Obama took office in 2009, those industries — which both fall under the "manufacturing" umbrella per the Bureau of Labor and Statistics — have barely seen growth, when compared to other sectors, like healthcare and education. The chart below shows the percent change of the American economy by sector, per BLS data. As you can see by mousing over, manufacturing (of things both green and not) has seen only a tiny bit of growth in 2011 and 2012 after huge drops in 2009 and 2010. Healthcare, on the other hand, has seen steady growth. And mining and logging has seen upticks every year since 2010.
The president's effect on businesses
How the president affects economic sectors is one thing. How a presidential speech affects the companies he visits? Another entirely.
Not all of the companies Obama has visited since his first term began have been listed on public exchanges (which makes sense, given that his focus is often to bolster growing businesses). For those that are, listed below, we took a look at the three days prior to and following the president's speech to get a sense for the effect it has on stock prices.
First, the big picture. We pegged prices and trade volume to the date three days prior to the president's visit at each company, tracking it through and past his appearance. This often includes days when no trading occurred (weekends, for example). On average, stock prices for companies the president visits increase about three percent the day before an Obama appearance — on volume that's 85 percent higher than two days prior.
Before you call your broker, however, two things you should note. First, that the day of the speech, prices are on average only one percent higher than three days before, and then decline. So buying Amazon today is too late. But, second, this is an average. Here's what each company's price did around the time of his speech.
That's a lot of deviation. It shows up better in the individual graphs for the companies, which are below. Larger companies were slightly more likely to see the one-day-before bump, but please do not gamble your retirement money on this.
The 16 companies we looked at:
- Alcoa (AA)
- Boeing (BA)
- Cree Inc. (CREE)
- Edison International (EIX)
- EMC Precision (EMC)
- Ford Motor Company (FORD)
- General Electric (GE)
- Honeywell (HON)
- Intel (INTC)
- Johnson Controls (JCI)
- Linamar (LNR)
- Orion Energy Systems, Inc. (OESX)
- Siemens (SI)
- Sempra Generation (SRE)
- UPS (UPS)
- ZBB Corporation (ZBB)
Additional reporting by Arit John.
This article is from the archive of our partner The Wire.
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