Long time readers know I don’t really talk politics on here – unless of course they have some sort of investment implications. We once wrote a paper titled “Politics and Profit: Combining the Presidential Cycle and the January Effect” that is by far our least read paper. I’m a registered independent, and with the two
choices available today I’ll be voting for the only candidates I can stomach.
Though I am having the incredible Sam Stovall on the podcast later today, and I’m sure we’ll talk about the stock market indicator that can predict the election winner with 80% accuracy.
Anyways, I was curious to see what Hillary Clinton would be worth today if she continued her cattle futures trading career. Many younger people don’t remember this, but in 1978 she magically turned $1,000 into $100,000 by trading the futures market for the first time. (RCM with a nice summary here too.) She also forgot to pay taxes on the gains until Bill ran for President, but that’s a different story.
That is a solid one year return of about 9,000%. If you know markets, you know that is highly, highly, highly unlikely. (What most likely happened is the broker would take two sides of a trade, then wait and place the winning trade in her account and losing trade in his/another account. It is sort of a shady way of just donating money to someone and certainly illegal and immoral. Cramer talked about doing this in his old book “Confessions of a Street Addict“. Much easier to get away with in the 70s and 80s than with electronic records of today.)
So, if she kept trading with her magical touch, she would have turned that $1,000 into $700 million in only three years, and trillions in less than 10 years! And by 2009 she would be a vigintillionaire (had to look that up).
Even if she lost her touch a bit and after that first year “only” compounded at 90% a year, she would be worth two quadrillion. And what if she totally lost her touch after year one, and starting with that tiny $100k, and made only 50% a year, she would still be the richest person on the planet at $300 billion (Gates is only about $90m).
Forget speaking fees and the presidency, time to go back to cattle trading!