With the Cold War in full swing, Americans didn't have much to celebrate in June 1949. The Chinese Communists were routing the Nationalists and would found the People's Republic of China by the end of the year. The Allies had successfully overcome the Soviet blockade of Berlin with a massive airlift of goods to the encircled city, but the Soviets would test their first atomic bomb within two months, dramatically altering the balance of power. At home, an increasingly unpopular President Truman saw most of his Fair Deal proposals defeated in Congress.
The S&P sank to 13.55 and then began an improbable climb. Despite the stalemate of the Korean War and continuing fears of Communist infiltration at home, the US economy prospered under President Eisenhower and the S&P finally topped its 1929 peak, more than tripling in value in seven years.
