Buoyant Ben Bernanke - Time's Person of the Year   Tuesday, December 29, 2009
By Gibbons Burke
 Fed Chairman Ben Bernancke is the first Fed chair to be named Time Magazine's Person of the Year, and the chairman of the Fed has only graced the cover of Time on five previous occasions. How has the market responded in the past to this event? Researching this question in Time Magazine's archive of covers, we find that the first Fed chair was Arthur Burns, who appeared on the cover with George Schultze in August, 1971. Q: How has the S&P 500 index performed in the past when the chairman of the Federal Reserve Bank has appeared on the cover of Time magazine? A: According to the 5 previous occurrences of this event, EventEdge indicates that SPX has shown a very strong bullish edge that peaks 7 trading days after the event. Thus, the projected date for the peak of the bullish edge relative to the current event date (Monday, 28 December 2009) is Wednesday, 6 January 2010. SPX rallies in 100% of the cases (5 of 5) by an average of 1.8% relative to the close on the event date. The overall return of the 5 cases is 1.8%, which, based on the close of SPX on the event date (1127.78), provides a target price of 1148.08. Gibbons Burke is editor of MarketHistory.com.
| | Let variable values:
@ = SPX
theEvent = IF
Date is 8/16/1971
OR
Date is 10/22/1979
OR
Date is 3/8/1982
OR
Date is 11/10/1997
OR
Date is 2/15/1999
OR
Date is 12/28/2009
THEN 1
ENDIF
Date Day t+1 t+7 t+15 t+25 t+37
08/16/1971 Mon 1.2 1.7 2.4 0.6 1.3
10/22/1979 Mon -0.4 1.1 2.8 5.6 6.9
03/08/1982 Mon 1.4 1.6 4.6 8.1 8.2
11/10/1997 Mon 0.3 2.5 5.5 5.1 6.1
02/15/1999 Mon 1.0 1.9 4.3 5.4 9.3
12/28/2009 Mon NaN NaN NaN NaN NaN
Avg 0.7 1.8 3.9 5.0 6.3
AvgPos 1.0 1.8 3.9 5.0 6.3
AvgNeg -0.4 NaN NaN NaN NaN
PctPos 80.0 100.0 100.0 100.0 100.0
PctNeg 20.0 0.0 0.0 0.0 0.0
Maximum 1.4 2.5 5.5 8.1 9.3
Minimum -0.4 1.1 2.4 0.6 1.3
StdDev 0.8 0.5 1.3 2.7 3.1
ZStat 0.9 3.4 3.0 1.8 2.1
Variance 0.6 0.3 1.7 7.4 9.5
6 Occurrences | |
No comments at this time. |
