Learn what happened in business in today’s past


June 24:

1997: The New York Stock Exchange begins quoting share prices in 1/16ths, nicknamed steenths or teenies. In theory, this narrows the spread between the bid price and the ask price, increasing the net return for investors. But on Wall Street, the Law of Unintended Consequences governs almost everything, and what you see is seldom what you get. In practice, the move to teenies makes filling large orders at a good price much harder, raising the cost of many trades, especially for institutions.

Charles M. Jones and Marc L. Lipson, Sixteenths: Direct Evidence on Institutional Execution Costs, Journal of Financial Economics, February, 2001 (vol. 59, no. 2), p. 254; http://www.nyse.com/

1971: An entrepreneur named Fred Smith founds a company to compete with the U.S. Postal Service. His goal is to deliver packages overnight -- by routing everything, no matter where it originates, through Memphis. The idea is so daffy that one of Smith's business school professors almost flunked him for proposing it. Smith calls his new outfit Federal Express -- and, before long, a new verb (to FedEx) has entered the language.