7 Dramatic Showdowns of Bonds and Stocks Amidst Historic Market Crashes

2. The Oil Crisis (1973-1974)

The oil crisis of the 1970s created a dramatic confrontation between bonds and stocks. With oil prices soaring, inflation quickly became a major issue, reducing the value of fixed-income investments like bonds. Stocks suffered as well, with corporate profits shrinking under the weight of high energy costs. This era highlighted the susceptibility of both asset classes to external shocks and reinforced the necessity for investors to hold diversified portfolios that can withstand such disruptions.