A Historical Look at Good Friday and the Stock Market

In honor of Good Friday, a religious holiday commemorating the crucifixion of Jesus Christ, the U.S. stock markets (and our offices) are closed today.

It’s a significant holiday in many countries, and as such, financial markets in those countries are often closed or have reduced trading hours.

But that doesn’t mean nothing happens on Good Friday that can affect financial markets…

In the past, we’ve seen blizzards hit the eastern U.S….

We’ve seen assassinations rock the nation to its very core…

We’ve had earthquakes that caused widespread destruction…

We’ve even had the precursor crash to a deep, long depression…

The Loss of the Great Emancipator

On April 14, 1865, Good Friday that year, President Abraham Lincoln and his wife Mary went to see a performance of Our American Cousin at Ford’s Theatre.

That fateful night, as Lincoln and his wife sat in the state box enjoying the play, an actor and disgruntled Confederate sympathizer, John Wilkes Booth, crept in behind them and changed the course of history in our country.

He shot the president in the head with a small pistol, then leapt from the balcony to the stage, fracturing his leg in the process, and shouted, “Sic semper tyrannis!” before limping off stage to make his getaway.

Booth would eventually be caught 10 days later, hiding in a farm near Port Royal, Virginia. Soldiers caught up to him and some of his co-conspirators and Booth was shot.

But the damage had been done. Lincoln was dead and would be replaced by his vice president, Andrew Johnson, who would lead the post-war reconciliation process.

Obviously not a very good Friday, but it did happen on Good Friday. And it was the first time in history that financial markets were closed due to a national event.

The Great Blizzard of 1872

Less than a decade later, and again on Good Friday, the eastern United States was hit by a snowstorm of epic proportions…

It caused widespread destruction and damage as it dumped up to two feet of snow in many areas over the course of three days.

Many people were trapped inside their homes and many businesses were forced to close due to the snow, not least among them the New York Stock Exchange.

With roads, bridges, and even railroads blocked by so much snow, traders were unable to even reach the exchange, and as a result it was closed for several days.

It’s remembered as one of the most severe weather events in U.S. history. And its one of many examples of how unexpected events, even weather-related ones, can have a significant impact on financial markets.

The San Francisco Earthquake of 1906

Several years later, a massive earthquake struck the west coast of the United States on Good Friday in 1906…

The quake occurred on April 18, 1906, and was estimated to have a magnitude of 7.9 on the Richter scale.

The earthquake caused widespread damage and destruction, with many buildings collapsing and fires breaking out across the city.

The San Francisco Stock Exchange (which still existed back then) was closed for two days following the quake, and many businesses were forced to close due to the damage.

The earthquake had a significant impact on the economy of San Francisco and the surrounding area, with many people left homeless and many businesses unable to recover from the damage.

The earthquake also had a wider impact on the U.S. economy, with many businesses outside of California also affected by the disruption to trade and transportation.

While the financial markets eventually recovered from the earthquake, it serves as a reminder of the potential impact of natural disasters on the economy and financial markets.

The Great Depression of the 1930s

On Good Friday of 1930, the stock market experienced a significant single-day decline that many historians consider a precursor to the Great Depression.

The market had been in a period of decline for several months before this, but the events of that day caused a further drop in stock prices.

The decline in stock prices on that day was partly due to the announcement that a major investment trust had gone bankrupt, causing panic among investors.

The New York Stock Exchange was closed on Good Friday, but the decline in stock prices continued when trading resumed on the following Monday.

Then, later in that same decade (and also on a Good Friday), in 1936, stocks took another big dive…

The Dow Jones Industrial Average fell 3.4% that single day on very heavy trading volumes hit as investors feared a war was about to start in Europe.

It’s Not Always Bad

Now, I know I just covered four events nobody would want to live through again: an assassination, an earthquake, a blizzard, and a massive depression.

But it’s not always bad stuff that happens on Good Friday (despite it being a day commemorating an execution)…

In fact, one of the most recent events to occur on a Good Friday made it a very good Friday for the entire world…

In 1991, on April 3, the United Nations declared a cease-fire in the Gulf War, officially ending nearly 12 months of fighting.

Exchanges closed early that day to allow traders to celebrate the end of the conflict.

And the world became a little more peaceful.

A good Friday, indeed.

Semper Paratus

But good or bad, those events from Good Friday’s past hold a valuable lesson for investors.

Unexpected events (be they weather-related, political, geopolitical, geographic, or global) can rock financial markets to their cores.

And investors need to be prepared for those unexpected occurrences. But how exactly do you prepare for something you can’t expect?

Well, as an investor, you can take several steps to prepare for unexpected events that may impact financial markets.

One important step is to have a well-diversified investment portfolio. This means investing in a variety of assets — such as stocks, bonds, and commodities — that are not all closely correlated with each other.

This can help to reduce the impact of unexpected events on any one particular investment.

Another important step is to have a plan in place for how to respond to unexpected events.

This could include having preset rules for when to buy or sell certain investments based on specific market conditions or events.

It is also important to regularly review and update this plan to ensure that it remains relevant and effective.

And, finally, you should also stay informed about current events and trends that may impact financial markets.

This should involve regularly reading financial news sources like Wealth Daily, Energy and Capital, and Outsider Club.

By staying informed and prepared, you can help to minimize the impact of unexpected events on your investments and financial well-being.

Happy Easter (and Passover and Ramadan)!

And that’s my missive for today. I hope everyone is having a great day and has an even better weekend.

I’m off to celebrate this season of renewal with those close to me. I hope everyone who also celebrates Easter has an excellent weekend reflecting on the reason for the season.

And I hope those of you celebrating Passover have a delicious feast and a week full of family and fun to go along with all that feasting.

And for those observing Ramadan (lots of holidays lining up this year), I hope your days go by quickly and your nights are filled with family, food, and festivities.

Most of all, I hope everyone, regardless of your religious beliefs (or lack thereof) has a restful weekend!

I’ll see you back here on Monday.

To your wealth,

Jason Williams

@TheReal_JayDubs

Angel Research on Youtube

After graduating Cum Laude in finance and economics, Jason designed and analyzed complex projects for the U.S. Army. He made the jump to the private sector as an investment banking analyst at Morgan Stanley, where he eventually led his own team responsible for billions of dollars in daily trading. Jason left Wall Street to found his own investment office and now shares the strategies he used and the network he built with you. Jason is the founder of Main Street Ventures, a pre-IPO investment newsletter; the founder of Future Giants, a nano cap investing service; and authors The Wealth Advisory income stock newsletter. He is also the managing editor of Wealth Daily. To learn more about Jason, click here.

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