By the time the 4 p.m. closing bell sounded at the New York Stock Exchange on Sept. 1, the Dow Jones Industrial Average had nosedived 469 points in a single day of trading.
This comes just over one week after the Dow Jones fell over 1000 points shortly after opening on Aug. 24. Massive selloffs such as these have become more common in recent weeks as fears over a stagnant Chinese economy continue to grow at a steady pace only to come to a boil each time the Chinese Central Bank artificially reduces the value of its currency on the open market.
While large corporations and everyday investors continue to fret over an exceptionally volatile market, politicians and the political machines that support them have reason to worry as well, albeit for reasons other than money.
The success of the Democratic and the Republican nominees for president is largely dependent on how the economy is performing. As George Bush Sr.learned in 1992, it is extraordinarily difficult for the incumbent party to retain its position if the economy falters during an election year. The opposite can be said in the case of the challenging party, where in their path to power is clear so long as the economy is on unstable ground.
If China continues to fall into an economic quagmire, expect the Republican Party to hammer the Democratic Party over President Obama’s economic policy, and expect for the eventual Democratic nominee for president to distance themselves from the sitting president as much as possible.