1862: The San Francisco Stock and Exchange Board is founded by 37 brokers to organize trading in silver and gold mining stocks -- primarily based at the booming Comstock Lode in Virginia City, Nev.
1929: The total market capitalization of all the stocks listed on the New York Stock Exchange reaches $82.11 billion. (The value of all securities, including U.S. and foreign stocks and government bonds, peaked that day at $136,409,448,062.) The biggest sector by far is the utilities industry, with $14.79 billion in market value, followed by railroads, petroleum, chemicals, and automobiles. By July 1, 1932, the market value of all listed stocks will shrivel to $12.70 billion, an 84.5% loss.
1932: How bad can it get? In the depths of the Depression, Wall Street takes its own pulse and detects only faint signs of life. In the bond market, 19.4% of all debt issued by foreign governments and corporations has defaulted, along with 14% of real-estate debt, 7.2% of all U.S. industrial bonds, 5.4% of utility debt, 3.5% of railroad issues, and 1.8% of all municipal bonds. The Dow Jones Industrial Average is at 73.67, down from 381.17 just three years earlier—an 80.7% loss.
1936: The National Association of Securities Dealers (NASD) is incorporated to oversee the conduct of brokerage firms. (Over the years, critics will point out that the NASD’s variable degrees of toughness toward its own members are a good reminder of the two main meanings of the word “oversight.”)
1711: The South Sea Company is chartered in London to trade with Latin America, sell annuities and manage the public debt. It shortly becomes the heart of the greatest speculative boom Britain has ever seen, as the stock rises more than 800% in a few months in 1720--and then, just as quickly, the worst bust in British history, as it loses roughly 80% of its value in a matter of weeks.
1831: The Madrid Stock Exchange (La Bolsa de Madrid) is established.
1846: Elias Howe patents his sewing machine, which can buzz 250 stitches across a bolt of cloth in a single minute--outracing the fastest human hands by a factor of five.
1960: Iran, Iraq, Kuwait, Saudi Arabia and Venezuela convene in Baghdad to form the Organization of the Petroleum Exporting Countries (OPEC), which nearly brings the industrial world to its knees in the 1970s by jacking up the price of oil.
1789: Alexander Hamilton is nominated, confirmed and sworn in as the nation’s first Secretary of the Treasury.
1988: The savings-and-loan crisis worsens as Financial Corp. of America, parent of the country’s second-largest savings & loan company, files for Chapter 11 bankruptcy protection. And the Federal Home Loan Bank Board, which oversees the floundering thrift industry, announces that it will merge five more failed savings & loans today—for a total of 49 bailouts since August 18, at a cost of $11 billion.
1836: The New York Stock Exchange prohibits its members from trading in the streets outside. But open-air trading persists under the nickname of "the Curb," which ultimately becomes the American Stock Exchange.
1968: As tech stocks boom, H. Ross Perot takes his Electronic Data Systems public for $16.50 a share, or 118 times earnings. (Perot had steadfastly kept his company private, refusing 17 offers to do an IPO, until investment banker Ken Langone declared that he could sell the stock for over 100 times earnings.) By early 1970, the stock is at $160.
1982: Forbes publishes its first "rich list" of the 400 wealthiest people in America. The first Forbes Four Hundred (minimum net worth for inclusion: $100 million) contains just 13 billionaires, ten of whom derive their fortunes from the oil industry. America's richest man is shipping magnate Daniel K. Ludwig, worth "above $2 billion." Warren Buffett clocks in at $250 million; Bill Gates is nowhere to be found. The only tech billionaire is Hewlett-Packard co-founder David Packard, and the list includes fewer than a dozen technology fortunes -- including such now-forgotten giants as Kenneth Olsen of Digital Equipment Corp. ($157 million) and An Wang of Wang Laboratories ($320 million).
1996: It's Friday the 13th, and Wall Street is awash in the usual superstitious worries that the market will tumble—but the Dow Jones Industrial Average surges up by 1.2% to close above 5800 for the first time, finishing the day at 5838.52.
1939: Russian émigré Igor Sikorsky ties a heavy rope to his VS-300 "direct-lift aircraft," fires up its engine, and gets the ungainly-looking thing to rise about two feet off the ground for a few seconds. With its main propeller in horizontal position, the "whirlybird" is the world's first practical helicopter.
1960: Pres. Dwight D. Eisenhower signs into law the Real Estate Investment Trust Act of 1960, which creates REITs, enabling retail investors to buy shares in commercial real estate for the first time.
1890: Baring Brothers, one of England’s leading investment banks, has disclosed that its loans to what we would now call “emerging markets,” like Argentina and Chile, have gone bad and that the firm will go bust unless the Bank of England comes to its aid. The Bank steps in, rounding up a rescue syndicate of other investment banks and assuming 28.5 million pounds’ worth of Barings’ liabilities. “Thus was averted what would probably have been the greatest panic in the world’s history.”
1958: LIFE Magazine highlights a strange new phenomenon: The public is investing in the stock market as never before. "On the average," reports LIFE, "500,000 new customers a year have been getting into the market and 8.6 million Americans now own some kind of common or preferred stock…. To an extent which our founding fathers could never have foreseen, we live today under a genuine people's capitalism, in which the stock market has become everybody's business." The Dow Jones Industrial Average is around 500, but a "prominent market observer" (probably choosing to remain anonymous because his forecast sounds so crazy) predicts that "Just inflation alone will some day carry the Dow-Jones average over 1,000." Imagine that.
1777: Nathan Mayer Rothschild, the world’s greatest merchant banker, is born in a decrepit, eight-foot-wide house in the Judengasse ghetto of Frankfurt, Germany, to Mayer Amschel Rothschild, a mail-order antique dealer, and Gutle Schnapper Rothschild.
1908: William Crapo Durant, the nation’s leading maker of wooden wagons and buggies, incorporates the General Motors Co. Durant knows that if GM succeeds, it will put his current industry out of business—and he goes ahead anyway. GM will serve as a holding company for the stock of Durant's Buick Motor Co., the biggest “motorcar” producer in the country--and will ultimately encompass dozens of other automakers and related companies.
1920: Slightly before 12 noon, a massive charge of dynamite goes off in a horse-drawn wagon parked in front of the Wall Street headquarters of J.P. Morgan & Co. Thirty people are killed immediately, another ten are mortally wounded, and hundreds are injured in a fierce hail of shrapnel and flying glass. "RED PLOT SEEN IN BLAST," declares The New York Times, but no “Bolshevik” involvement is ever proven and, to this day, the crime has never been solved. Several buildings along Wall Street are still scarred from the blast.
1929: The Standard & Poor’s 500-stock index (calculated retroactively) hits 31.86, its peak for the Roaring Twenties bull market. It does not close above that level until September 22, 1954. When you hear that stocks “always outperform in the long run,” do you realize how long “long” can be?
1998: Stock markets take a worldwide pounding after Federal Reserve Chairman Alan Greenspan tells Congress that there are no plans for coordinated global interest-rate cuts. Despite the Russian debt crisis, Greenspan says he sees no immediate need to relieve the “peripheral gusts” of “financial turmoil.” The Dow Jones Industrial Average slumps 216.01 points, or 2.67%, to close at 7873.77; the NASDAQ loses 2.58%, while Japanese stocks fall 2.4%, German stocks drop 3.9%, and the French market slumps 5.5%. Analysts are uniformly pessimistic, but in three weeks the U.S. stock market bottoms out and then heads straight up.
1873: Jay Cooke & Co. of Philadelphia, one of the nation’s largest investment banks, collapses as a result of failed speculations in railroad stocks--triggering the Panic of 1873. Cooke--and the entire financial world--were taken completely by surprise. Just the night before, he had lavishly entertained Pres. Ulysses S. Grant at the Cooke family mansion in Chelton Hills, PA.
1926: The Great Miami Hurricane smashes into Florida with 138-mph winds, killing 243 people and, in a single devastating stroke, ending the speculative Florida land boom.
1974: At a seminar sponsored by the Institute of Chartered Financial Analysts, Benjamin Graham declares that his valuation formulas enable him to estimate that the fair value of the Dow Jones Industrial Average is around 750. The Dow closes that day at 651.91, but it surges 3.4% the next day as word of Graham’s analysis spreads--and it rises past 750 just six months later.
1931: This message is a light-hearted reminder that his mother is about to leave on vacation. In fact, the Bank, referring to itself by the common nickname "Old Lady," means that it is about to abandon the gold standard -- a decision Norman has vehemently opposed for years. He ignores the telegram, the Bank assumes Norman accepts the decision, and the next day the Bank announces that it is suspending payments in gold.
1974: U.S. Secretary of the Treasury William E. Simon predicts that interest rates, then around 8%, will soon fall. The Dow leaps 3.4% on the good news. Over the next seven years, interest rates proceed to double.
2000: The International Monetary Fund issues its World Economic Outlook report, forecasting that "growth is projected to increase in all major regions of the world, led by the continued strength of the U.S. economy, the robust upswing in Europe, the consolidation of the recovery in Asia and the rebound from last year's slowdown in emerging markets." Just weeks later, most regions of the world are tilting toward recession.