<\/p>\n

Every two years a country from anywhere in the world is strategically chosen to host the Olympics. I say strategically because\u00a0being given\u00a0the honor to host\u00a0the Olympics greatly effects\u00a0a country\u2019s reputation, residents, and, most importantly, its economy. Therefore, to account for this major event, economists at Bespoke Investment Group came up with the Olympic Indicator<\/a> to measure the state of the economy during this exciting time.<\/p>\n

The Olympic Indicator shows that markets tend to prosper\u00a0during the Olympic games. Bespoke Investment Group explains this by saying that the excitement of the games distracts investors from problematic economic data and headlines. Bespoke confirmed this notion by tracking the Dow Jones performance during the Summer Olympics between the opening and closing ceremonies since 1900. Their results; positive returns in 18 of the last 26 games.<\/p>\n

This summer\u00a0in Rio de Janeiro marked the 31^{st<\/sup>\u00a0Summer Olympics. However,\u00a0}<\/a>there were a lot of concerns<\/a> leading up to the games on whether Rio could afford the Olympics, issues with their government<\/a>\u00a0and city safety, the presence of the Zika Virus<\/a>, issues with severe water pollution and if the Olympic buildings were even going to be finished on time.<\/p>\n

However, with all these problems, the U.S. economy still\u00a0seemed to benefit from the games. By looking at the chart below\u00a0it is evident that the Dow Jones Average spiked from 18.352.05 on August 4 to 18.543.53 on August 5, which was the day of the Opening Ceremonies in Rio. Although the average fluctuated during\u00a0the Olympics, ever since August 21, the date of the Closing Ceremonies, the average is almost back at where it started on August 4.<\/p>\n

<\/a><\/p>\n

Although the\u00a0Dow Jones Average shows that the American stock market did improve\u00a0during the 3 weeks of the\u00a0Olympics, the Olympic Indicator does not actually prove that the games distract investors. Therefore,\u00a0the economic growth that occurs during the Olympics can also be explained by\u00a0looking at the money that is entering markets around the world. For example, NBC Universal<\/a>\u00a0paid $1.2 billion for the right to broadcast the Olympics in Rio, which is chump change to Rio\u2019s estimated $12-20 billion<\/a> they spent on hosting the games. All of this money promotes consumer spending and puts money into the economy that was not there before, which\u00a0in turn, betters the economy.<\/p>\n

<\/a><\/p>\n

Sources:<\/p>\n

http:\/\/www.marketplace.org\/2016\/08\/05\/world\/let-s-do-numbers-what-has-been-spent-rio-olympics<\/a><\/p>\n

http:\/\/www.usatoday.com\/story\/sports\/olympics\/rio-2016\/2016\/05\/12\/impeachment-trial-set-rio-olympics\/84275984\/<\/a><\/p>\n

http:\/\/www.marketplace.org\/2016\/08\/05\/world\/let-s-do-numbers-what-has-been-spent-rio-olympics<\/a><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Every two years a country from anywhere in the world is strategically chosen to host the Olympics. I say strategically because\u00a0being given\u00a0the honor to host\u00a0the Olympics greatly effects\u00a0a country\u2019s reputation, residents, and, most importantly, its economy. Therefore, to account for this major event, economists at Bespoke Investment Group came up with the Olympic Indicator to […]<\/p>\n","protected":false},"author":808,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/posts\/1795"}],"collection":[{"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/users\/808"}],"replies":[{"embeddable":true,"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/comments?post=1795"}],"version-history":[{"count":8,"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/posts\/1795\/revisions"}],"predecessor-version":[{"id":1855,"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/posts\/1795\/revisions\/1855"}],"wp:attachment":[{"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/media?parent=1795"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/categories?post=1795"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/j469.ascjclass.org\/wp-json\/wp\/v2\/tags?post=1795"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}