Chart of the Week: Gasoline $ versus Incumbent Approval Ratings

For those of you who would like a simple thesis for predicting the outcome of the election – one that is both highly correlated and has a strong causative element – we suggest the chart below, courtesy of DePaul University economics Professor Stuart Eugene Thiel. The professor plotted the weekly US gasoline prices (inverted) versus a Presidential Index. As the chart reveals, gasoline prices are coincident indicators to the incumbent’s approval rating.

Gasoline $ versus Incumbent Approval Ratings
click for larger chart

We are a nation of drivers. “Pump pain” erodes consumer’s confidence, reduces discretionary spending, and crimps family budgets. As a predictive factor in the Presidential election, the higher gasoline prices are, the greater the negative impact it is likely to have for the incumbent.

Random Items:
A 100-year bear market?
The Long Tail
After Iraq, Iran?
Target Iran – Air Strikes
Why Bush and Kerry are Wrong on Health Care
Seymour Hersh spills his guts
Presidential Polling Data Resources

Quote of the Day:
“With enough inside information and a million dollars, you can go broke in a year.
-Warren Buffett.

Print Friendly, PDF & Email

What's been said:

Discussions found on the web:
  1. BOPnews commented on Oct 15

    Causation & Correlation: Gasoline vs. Incumbency

    With the debates now behind us, voters (and investors) can expect to hear a spate of

  2. Troy commented on May 18

    Does not matter what approval rate Bush has…I am sure that Americans will still vote for him..

Read this next.

Posted Under