by Gary Alexander

March 9, 2021

America learned a history lesson by accident last week. Congress closed its doors on Thursday in fear of another assault on the Capitol on the original Inauguration Day of March 4, thereby teaching America a little ancient history, so let me capitalize on that stroke of accidental education by taking you back 100 years to the swearing in of Warren G. Harding as our 29th President on March 4, 1921, a time of turmoil,

How times have changed, and stayed the same! Here are a couple of headlines from about a century apart:

Normalcy Due Here Quickly…the Slump Should Be All Over Within Two Months

–Los Angeles Times headline, April 17, 1921

U.S. Is Edging Toward Normal, Alarming Some Officials

–New York Times headline, March 1, 2021

Newspaper Headlines Image

If anything, conditions were worse in 1920-21 than in 2020-21.

In the four years prior to Harding’s Inauguration, America endured World War I, costing us over 100,000 lives, then our worst-ever pandemic, costing an estimated 675,000 lives (with less than one-third of today’s population), race riots, labor strikes, anarchist bombings – including a deadly Wall Street bomb in 1920, killing 38. A “Red scare” swept the nation – a widespread fear of Eastern European immigrant anarchists.

America was divided over President Woodrow Wilson’s “League of Nations” nostrum, but Wilson himself was incapacitated by a stroke. His wife Edith was effectively running the nation for his last 17 months in office. Even baseball’s World Series fell from grace with the White Sox (Black Sox) scandal of 1919. Natural disasters included 40 tornadoes striking on Palm Sunday 1920, leaving over 380 dead. The last Spanish flu deaths came the same month, April 1920, but nobody knew for sure the plague was over.

In the economy, unemployment was high and rising, and stocks were falling. In the election year 1920, the Dow fell 32.9%. Overall, the Dow fell 46.6%, from 119.62 on November 3, 1919 to 63.90 on August 24, 1921, the biggest drop since the Panic of 1907. The recession of 1920-21 ran almost simultaneously, from January 1920 to July 1921, with deflation pushing prices down by double digits. From May 1920 to July 1921, automobile production was down by 60% and overall industrial production was cut by 30%.

United States Unemployment Rates Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

To fight this insurmountable series of setbacks, the Republicans picked their “least bad” candidate (sound familiar?), a man who could only promise a “return to normalcy.” In a May 1920 speech, Ohio’s Warren G. Harding orated, “America’s present need is not heroics, but healing; not nostrums, but normalcy; not revolution, but restoration; not agitation, but adjustment; not surgery, but serenity; not the dramatic, but the dispassionate; not experiment, but equipoise; not submergence in internationality, but sustainment in triumphant nationality.” And he said all this from his front porch, akin to Joe Biden’s Delaware basement.

Warren G. Harding Campaigning Outside his Home Image

After enduring eager world-changers like Woodrow Wilson and Teddy Roosevelt, Harding’s promise of normalcy sounded like the right medicine. Harding carried every state outside the south (37 of 48 states) and the Republican Party also won sizable majorities in the House of Representatives and Senate.

Harding was not a very effective President, but after Harding died in 1923, his Vice President Calvin Coolidge fostered boom times by keeping his hands off the economy (see “Coolidge” by Amity Schlaes). The economy grew steadily, with no inflation to speak of, and the Dow Industrials gained about 500%.

Dow Jones Industrial Average 500% Rally Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

Look for the Silver Lining, after April Showers

I might add that people didn’t continue wearing face masks after 1920. They also started shaking hands and hugging and dancing again, and they maintained a positive attitude. Despite the Depression that raged until the middle of 1921, the songs of 1921 were mostly positive. I have been reviewing them in my radio program. 1921 was the birth of the Jazz Age, with some hot music coming out of New Orleans and New York alike, but on the hit parade, the nation danced or dreamed to songs of hope. Here are just three.

1) “Look for the Silver Lining” was written at the peak of the pandemic in 1919 by Jerome Kern (music) and Buddy DeSylva (words), but it gained a second life in 1921 with a hit record by Marion Harris, and it was also sung by Marilyn Miller in the musical Sally. It later became the title of Miller’s 1949 biopic. The words were therapeutic, as sung by Judy Garland washing dishes, dreaming of a better life…which came.

Look for the silver lining
Whenever clouds appear in the blue
Remember, somewhere the sun is shining
And so the right thing to do is make it shine for you.

A heart full of joy and gladness
Will always banish sadness and strife
So always look for the silver lining
And try to find the sunny side of life.

2) “April Showers” was written by the same Buddy DeSylva in October 1921, playing on the same positive theme. He gave the song to the popular Al Jolson, who reprised it often, as in “The Jolson Story” (1946) and other movies in that era. America had suffered greatly, so this hopeful message still resonated:

Though April showers may come your way
They bring the flowers that bloom in May
So if it’s raining have no regrets
Because it isn’t raining rain you know
It’s raining violets

And when you see clouds upon a hills
You know they’ll bring crowds of daffodils
So just keep on looking for a bluebird
And listening for his song
Whenever April showers come along

3) “Ain’t We Got Fun?” was the comic hit of the year, sung by Gus Van & Joe Schenck. It speaks of unemployment and evading bill collectors, but from a carefree point of view, characteristic of the Jazz Age. It was one of the first hits written by Richard Whiting, with words by German-born Gus Kahn. So many European immigrants had mastered American slang. Here’s Peggy Lee’s updated 1958 lyrics.

Ev’ry morning, ev’ry evening, ain’t we got fun?
Not much money, oh, but honey, ain’t we got fun?
The rent’s unpaid dear, we haven’t a car.
But anyway dear, we’ll stay as we are.

Even though, we owe the grocer, don’t we have fun?
Tax collector’s getting’ closer, still we have fun
There’s nothing surer, the rich get rich, and the poor get poorer.
In the meantime, in between time, ain’t we got fun?

Song Titles Images

In an instant replay, after World War II, Americans feared another postwar Depression as severe as the Big One that hit America in 1920-21, but it never came. However, a slew of 1921 songs were revived. April Showers made a revival in “The Al Jolson Story” (1946) and in its own film in 1949. And “Look for the Silver Lining” was part of the Jerome Kern biopic, “Till the Clouds Roll By” (1946) as well as its own film in 1949. Another 1921 song had a second life in 1947 as a #1 hit by Eddy Arnold. “Anytime” was composed by Herbert “Happy” Lawson, and its second chorus offered the same upbeat message:

Anytime your world is lonely
And you find true friends are few
Anytime you see a rainbow
That will be a sign the storm is through.

It’s the American way to emerge from troubles with a positive spirit and not look for the darkest clouds.

All content above represents the opinion of Gary Alexander of Navellier & Associates, Inc.

Please see important disclosures below.

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About The Author

Gary Alexander

Gary Alexander has been Senior Writer at Navellier since 2009.  He edits Navellier’s weekly Marketmail and writes a weekly Growth Mail column, in which he uses market history to support the case for growth stocks.  For the previous 20 years before joining Navellier, he was Senior Executive Editor at InvestorPlace Media (formerly Phillips Publishing), where he worked with several leading investment analysts, including Louis Navellier (since 1997), helping launch Louis Navellier’s Blue Chip Growth and Global Growth newsletters.

Prior to that, Gary edited Wealth Magazine and Gold Newsletter and wrote various investment research reports for Jefferson Financial in New Orleans in the 1980s.  He began his financial newsletter career with KCI Communications in 1980, where he served as consulting editor for Personal Finance newsletter while serving as general manager of KCI’s Alexandria House book division.  Before that, he covered the economics beat for news magazines. All content of “Growth Mail” represents the opinion of Gary Alexander

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