The S&P 500 is down 8%, close to the days of 1974 when America struggled with double-digit inflation
If the market’s performance these days is giving you flashbacks to the days of 1973 and 1974, when President Richard Nixon resigned and President Gerald Ford $F replaced him, it’s with good reason: They’re the only two presidents in the post-World War II era who endured a worse stock market performance in their first 100 days than President Donald Trump.
Trump’s first 100 wraps up on April 30, and as of Monday the S&P 500 Index was down about 8% since his inauguration. That’s the worst 100-day performance since Ford in November, 1974, when the S&P was down 11.8%. The second-worst was Nixon’s second term the same year — the S&P was off 9.7% for him.
Nixon resigned from the presidency on August 8, 1974 to avoid impeachment over the Watergate scandal, and was replaced the same day by Ford, his vice president. His resignation came as the nation was still struggling with the effects of a year-long Arab oil embargo that sparked double-digit inflation and stagflation.
Inflation was 2.9% and declining when Trump was inaugurated this January and the economy was generally strong. He promised Americans a “boom like no other” during his campaign and investors took him at his word: The market posted its best post-election gain ever immediately after Election Day last November. But then Trump imposed the steepest tariffs in a century on April 2, and the S&P 500 dropped more than 10% in two sessions shortly after. Prices have been in a state of whiplash ever since.
Numerous economists and market experts are now predicting a recession rather than a boom for later this year. Both the S&P 500 and the Nasdaq $NDAQ were down in midday trading on Monday, dragged down by a sell-off in tech stocks and continued concerns about the impact of Trump’s trade war.
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