The official start of summer has always been a busy week in finance. This week offers a rich selection of low points and high points from the pages of financial history, including the start of the agricultural revolution, a huge philanthropic donation and one of the biggest scandals to rock the financial world. (Missed last week's article? Check out Wall Street History: Superman, Trump And Mr. Copper.)

IN PICTURES: 4 Biggest Investor Errors

Don't Fear the Reaper
On June 21, 1834, Cyrus Hall McCormick patented the reaping machine. This handy invention industrialized American agriculture and marked the first phase of rapid economic growth in the United States. In fact, the reaping machine was considered one of the most important inventions of the age - highlighting how much of the world economy was still centered on agriculture. As is common with inventions, McCormick is just one of many credited for the innovation. However, his patent helped the McCormick Harvesting Machine Company become the dominant producer of agricultural machinery for half a century. (Find about the men who helped turn America into a powerhouse in The Unsung Pioneers Of Finance.)

Not Worth A Continental
On June 22, 1775, Continental bills of credit, essentially an early American currency backed by the promise of payment from future tax revenues, were printed to fund the revolution. This lack of solid backing left Continentals vulnerable to high inflation. Adding to the problem of inflation, Continentals often saw their redemption value swing wildly with the fortunes of war. The chaos of war and currency fluctuation embittered the American people so much against paper currency that it was nearly a century before the experiment was tried again. (To find out more, check out The History Of Money: Currency Wars.)

Madoff's Feeder Funds
On June 22, 2009, the SEC charged Cohmad Securities with being a feeder fund to Bernie Madoff's $50 billion dollar Ponzi scheme. The SEC alleged that the brokerage firm helped entice clients to invest billions of dollars with Madoff. In return for the capital needed to keep the scam going, Madoff allegedly paid hundreds of millions back to the brokerage. The fact that the firm was deeply involved with Madoff's inner circle - the name Cohmad is a combination of Madoff's name with his friend Cohn's - has thrown a lot of doubt on Madoff's claim that he did it all alone.

Hedge Funds Escape Regulation, For Now…
Hedge funds will, by definition, always be on the edge of finance. Whether it is John Paulson betting against the housing bubble or LTCM getting caught overstretched and undercapitalized, this segment of the market has no shortage of headlines.

On June 23, 2006, a U.S. federal appeals court tossed out a controversial rule requiring hedge fund advisors to register with the SEC. The rejection of the rule marked another unsuccessful attempt by the SEC to tighten controls on the expanding hedge fund industry, worth well over $1 trillion in assets at the time. This case failed because the court rejected the SEC's attempt to have the definition of client expanded to overlap the definition of investor. The SEC will, it seems, have another kick at the proverbial can as the final details of the financial overhaul are being hammered out this year.

Trouble in Tobacco
June has historically been a rough month for tobacco companies. On June 24, 1964, the Federal Trade Commission announced that health warnings must be printed on all U.S. cigarette packages. At the time, most of the companies were worried about the impact that the advertising would have on sales. Alas, the companies had one very strong thing in their favor - addiction. However, this issue came back to bite them on June 24, 1992, when the Supreme Court ruled that the mandatory health warnings on cigarette packages did not protect companies from litigation stemming from health problems experienced by consumers. The tobacco industry had been hoping for the opposite ruling to help quell the multi-million dollar lawsuits threatening profits.

Mommy's Back
On June 24, 1998, AT&T began to merge its way back into local markets by buying Tele-Communications Inc. The deal cost AT&T over $40 billion and fit nicely into the company's strategy of rebuilding its network. Over a decade earlier, the former phone monopoly, better known as Ma Bell, was forced to break-up under the Sherman Antitrust Act. The baby bells went on to become some of the most successful spin-offs in history. Since re-entering the regional market in 1998, Ma Bell was bought out by one of her babies in 2005, but the new company was renamed AT&T to keep the tradition going.

Buffett Goes Philanthropic
On June 25, 2006, the oracle of Omaha, Warren Buffett, announced that he will give away 85% of his fortune to the Bill and Melinda Gates Foundation. The following day he signed over more than $30 billion dollars of his fortune. (Find out more about Buffett's gift in The Christmas Saints Of Wall Street.)

The People's Bank
Lastly, on June 26, 1934, the Federal Credit Union Act was passed. This act cleared the way for the creation of credit unions all over the country, allowing people to pool their resources rather than depending big banks. The popularity of credit unions has varied over time, but these alternative banks have been enjoying a resurgence as larger banks keep gaining more and more of their revenue from fees. A credit union will charge you fees, but at least you'll get some of that profit at the end of the year. (Learn more about the alternatives in Choose To Beat The Bank.)

That's all for this week in financial history. Next week we'll look at Apple's great comeback, the birth of the IRS, and much more.

Catch up on the latest financial news, read Water Cooler Finance: Billion Dollar Summits and Barack Vs. BP.

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