Tax time is looming large in everyone's minds these days. As we'll see in our review of financial history this week, regular folks aren't the only ones prone to tax problems. American presidents, the leaders of the nation doing the taxing, have also ducked out of their tax bill. We'll look at this and more. (Missed last week's article? You can find it here, This Week in Financial History: Bre-X, Silver Thursday And Adelphia.)

IN PICTURES: Biggest Stock Scams

The Road To Enron
On March 29, 1996, the New York Mercantile Exchange (NYMEX) opened up a new commodities market to trade energy. Once thought impossible, energy was deregulated and commoditized. The fledgling market introduced companies and states to a mark to market approach to energy where the cost of energy fluctuated day by day and minute by minute. Some states saw costs drop while others, notably California, saw brownouts.

Energy traders quickly became some of the highest paid on Wall Street. Within five years, they would be vilified as Enron, one of the most touted energy brokers, collapsed in scandal. (Where there is money, there are swindlers. Protect yourself by learning how investors have been betrayed in the past in The Biggest Stock Scams Of All Time.)

Sam Walton Debuts
March 29, 1918, marked the birth of Sam Walton, founder of Wal-Mart. Born in Oklahoma, Walton made his fortune through the retail giant. What made the company stand out in a fiercely competitive industry was Walton's belief that people would travel for the best prices. He knew he couldn't go head-to-head with the larger stores because he had less capital to work with. Instead, he focused on building stores around shipping hubs, increasing inventory efficiencies and sharing profits to motivate employees.

Cost consciousness, a commitment to increasing efficiency and the ability to negotiate volume discounts with suppliers gave Wal-Mart a pricing edge that few retailers have yet to match. Today, Wal-Mart is one of the world's largest companies and Walton's heirs are among the richest people alive.

Seward's Folly
William Seward earned a lot of public ridicule purchasing Alaska from the Russians for $7.2 million on March 30, 1867. The public called the purchase "Seward's Folly" and referred to Alaska as "Seward's Ice Box."

Paying a few cents an acre, Seward has had the last laugh. Gold was discovered in Alaska decades later, followed by the discovery of black gold in the form of oil. Seward's Folly turned out to be one of the best investments the U.S. has ever made.

April Fools?
On April 1, 1973, Wall Street money managers had no idea they were soon to be made the fools. A Random Walk Down Wall Street by Burton Malkiel took Wall Street and Main Street by storm, creating warring factions of "random walkers," "efficient market hypothesis" believers and fundamental value investors.

Malkiel's premise that stock price fluctuations are random has been a consistent thorn in the sides of the money managers paid to pick stocks. Many people point to Peter Lynch and Warren Buffett as proof that the market isn't entirely random, but the debate rages on. (The efficient market hypothesis (EMH) suggests that stock prices fully reflect all available information in the market. Is this possible? Find out in What Is Market Efficiency?)

Mints and Marlboros
April 2, 1792, marks the creation of the United States Mint with the passage of the Coinage Act. This was the birth of the U.S. fiscal system, and for the first time the new nation had a currency for domestic and international trade.

April 2, 1993 was Marlboro Friday. Phillip Morris entered a price war with generic cigarette producers, slashing prices and counting on its brand strength to compete. The decision sent its stock tumbling down by 26% and reducing the company's market cap by $10 billion.

The Marlboro Man rode high in the end, however, as consumers tended to go with the brand name product when faced with the same price. Phillip Morris was one of the great air pocket stocks, recovering to full value within two years and rewarding the contrarian investors who bought in based on the company's brand recognition.

Naughty Boy, Mr. President
Finally, on April 3, 1974, President Nixon agreed to pay over $400,000 in back taxes. With the controversy over the Watergate scandal, the president's tax filing error has been mostly forgotten. The revelation was foreshadowed when the vice president, Spiro Agnew, pleaded no contest to tax evasion a year earlier. Nixon will forever be remembered for saying, "I am not a crook," but he certainly could have fooled the IRS.

Next week we'll see sin taxes, the death of an eccentric multimillionaire and the seizure of the entire U.S. steel industry.

Still feeling uninformed? Check out last week's business news highlights in Water Cooler Finance: Zombies File Taxes, Dead Bills Rise Again.

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