Certified financial planner Wes Moss provides personal finance advice and accessible investment strategies. His guest post appears here weekly.
In the presidential horse race, the Gallup Poll serves as the track announcer, bellowing out a steady stream of numbers detailing who is ahead and by how much. No modern day president (since Dwight Eisenhower) has won re-election without at least a 50 percent approval rating heading into the election.
At the end of last work week, Gallup’s election poll had President Barack Obama and Mitt Romney deadlocked at 47 percent each, with Obama’s approval rating also at just 47 percent. (Gallup updates its polling page at 1 p.m. daily.)
But there are other, less-familiar numbers we should be watching as the campaigns move toward the final stretch: numbers related to the economy.
Unemployment rate: No modern-era president has won re-election with the jobless rate above 7.6 percent. It’s now 8.1 percent, down from 8.3 percent in July. Worse, that decrease appears to be the result of people abandoning their job searches, not finding employment — clearly a problem for the Obama campaign.
Nonfarm payrolls: Going back to Lyndon Johnson, no president has won a second term with nonfarm payrolls growing at less than 1 percent per month during the nine months preceding the election. This pattern does not bode well for Obama.
Real per-capita income growth: This has to do with how much more money we are putting in our pockets each paycheck. No modern-era president has won re-election with negative real per-capita income growth. Obama stands at just below 0 percent real per-capita income growth today, meaning U.S. workers are earning less and less take-home pay.
Based on these numbers, it might seem the president’s days in the White House are numbered. But remember that line in investment ads: Past performance is not indicative of future results.
That’s true of political trends as well as investments. But these are such unpredictable times — and it’s obviously a very close call.
What other economic metrics would you use to predict the presidential race?
And how much will the election’s outcome affect your personal economy?
– Wes Moss, for AJC Atlanta Bargain Hunter blog