Learn what happened in business in today’s past
2000: The Internet continues to empower investors (although not quite the way most people wish), as Internet Wire, a press release service, issues a bulletin stating that the Securities and Exchange Commission is investigating Emulex Corp.s accounting practices. In 16 minutes, the stock sheds $2.2 billion in market value. It turns out that the press release is a fabrication by a former Internet Wire employee who is short-selling Emulex stock. He pockets $241,000 in profits, while thousands of investors lose their shirts, locking in at least $110 million of losses by selling on the news. Two weeks later, the SEC nails the con artist, Mark Jakob, for securities fraud.
1987: The Dow Jones Industrial Average hits 2722.42, a new record high--up 44% for the year and triple its level of 776.92 just five years earlier. In a market like this, every story is a positive one, says Jon Groveman, head equity trader at Ladenburg, Thalmann & Co. Any news is good news. Its pretty much being taken for granted now that the market is going to go up. For a while, anyway: Less than two months later, on October 19, the Dow loses 23% in a single day.
John A. Prestbo, ed., The Markets Measure: An Illustrated History of America Told through the Dow Jones Industrial Average (Dow Jones, New York, 1999), pp. 88, 91; The Wall Street Journal, August 26, 1987, p. C1; http://www.djindexes.com
1921: The Dow Jones Industrial Average closes the day at 63.91, up a minuscule 0.01 points on robust volume of 623,000 shares. No one knows it, but the biggest bull market of the 20th Century has begun. By September 3, 1929, the Dow will peak at 381.17, a 496.6% cumulative gain, or roughly a 24% annual return over eight years.
Phyllis S. Pierce, ed., The Dow Jones Averages 1885-1980 (DowJones Irwin, Homewood, IL, 1982), not paginated; http://www.djindexes.com; http://www.nyse.com/marketinfo/p1020656068262.html?displayPage=%2Fmarketinfo%2F1022221392351.html
1872: Justin Ford Kimball is born near Huntsville, Tex. In 1929, as an administrator at Baylor Universitys hospital, Kimball notes that Baylor is treating many Dallas teachers who can't pay their hospitalization costs. So he creates a plan enabling teachers to prepay 50 cents a month for up to 21 days of treatment at Baylor. By the end of 1929, as the Great Depression sets in, three-fourths of all teachers in Dallas have signed up, and Kimball's Blue Cross health insurance soon goes nationwide.