The US Stock Market Fell 39% During Watergate

The US Stock Market Fell 39% During Watergate

During Watergate and the lengthy process of getting Richard Nixon to resign, political instability weighed all sorts of havoc on the US economy with the S&P 500 falling from a high of 142, when Nixon assumed his second term in January 1974, to a low of 86 just after his August 9, 1974 resignation.

Watergate involved a crime and a tremendous breech of the public’s trust, and a significant erosion of the business climate and market values.

As difficult as Watergate was for the US, it did not involve the election of a President with significant psychological and intellectual shortcomings.  It did not involve those shortcomings enabling the White House to be controlled by an adverse power controlled by a despot trying to reassert his country’s power worldwide.   It did not involve a Republican Congress so subservient to a President that all checks and balances inherent in the government needed to be quickly reestablished and strengthened, at the public’s insistence, for impeachment proceedings to begin.

The US likely faces a difficult and uncertain next couple of years as the entire process around Trump, and the 2016 Russia-backed coup d’etat, is sorted out.  History shows us that the stock market is unlikely to escape these challenges ahead without real damage.  

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  • guest

    February 15, 2017

    I feel that once the impeachment process start we might see some pullback but the markets will probably rally back up as Pence is viewed as a great contender by the republican party establishment.

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