Stock market and Leadership

Ruchir Sharma, head of emerging markets and chief global strategist at Morgan Stanley Investment Management, wrote in his latest book, The Rise and Fall of Nations.

Q: Leaders begin on a promising note but do not do well later...
A: That circle of life is very applicable not only to the emerging world, but also to the developed world. You look at Margaret Thatcher or even Angela Merkel today.
I say in the book that the (Vladimir) Putin I met in 2003 for the first time was very different from the Putin of 2010. Same thing with (Recep Tayyip) Erdogan. The most fascinating piece of research that I found in that thing that we did was that when a new leader is elected, 90% of the time, the stock market does really well in the first couple of years and if that same leader does well in the first term is reelected, the stock market does not outperform in the second term. Even if he or she does good work in the first term, by the second term and especially by the third term, they all become jaded, authoritarian, or just arrogant. 


Source: http://epaperbeta.timesofindia.com/Article.aspx?eid=31815&articlexml=If-Fed-Increases-Rates-China-Will-be-the-22062016011044