Worst Markets in Three Decades Hang Over Elections (Update1)

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By Michael Patterson and Daniel Kruger

Nov. 4 (Bloomberg) -- ... The Standard & Poor's 500 Index dropped farther and faster than any time since the administration of Gerald Ford, losing 38 percent from an all-time high last year. Corporate bonds slid the most last month in at least 32 years as bank losses topped $680 billion and consumer confidence hit an all-time low ...

``October was a slow-motion crash,'` said Joseph Keating, chief investment officer at RBC Private Asset Management in Birmingham, Alabama, who oversees $3 billion. ``The economic reality is going to set in for whichever gentleman is elected. They'll both be looking at the worst recession since 1980.''

Stocks plunged since last year as a nationwide decline in U.S. home prices spurred record foreclosures and saddled banks with bad mortgage loans. Money markets seized up, sending the so-called TED spread, a gauge of credit-market stress, to the highest level on record last month.

The S&P 500's drop since its peak is the steepest for a comparable period since it declined 43 percent in the 13 months ended in October 1974, according to data compiled by Bloomberg ...

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