At some point in history, even the mega cap stocks were uncertain startups. This week in financial history, we can see the beginnings of several of today's corporate giants, several important birthdays and one high-profile stint behind bars. (Missed last week's article? Check out Wall Street History: A Robber Baron And A Beer Baron.)
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Worth 1,000 Words
On July 12, 1854, George Eastman, philanthropist and the inventor of the Kodak (NYSE:EK) camera, was born in New York. Eastman invented the first practical roll film along with the camera to use it. The Eastman Kodak Company mass-produced the film and, by virtue of the cheap supply, standardized the industry. Eastman made photography an accessible hobby in the same way that Ford (NYSE:F) popularized the weekend drive. Much of the latter part of Eastman was spent giving away the fortune that Kodak brought him.
On July 15, 1916, Pacific Aero Products was incorporated. The founder, William E. Boeing, renamed the company after himself within a year of operations. Boeing (NYSE:BA) built several different types of planes in the early years – two-seaters for the most part – but when war broke out, the company started building big. The B-Series bombers added to the "arsenal of democracy" that saw the U.S. through several wars. Boeing's ability to build big led to a strong lead in airplane manufacturing, with the 747 becoming one of the world's most recognized airliners. Boeing continues today as a manufacturer for both commercial and defense aircraft. (Although high fuel prices and threats of terrorism have scared many individuals out of airline stocks, the astute investor can still make money in the sector. Find out more, in Is That Airline Ready For Lift-Off?)
Martha's Hard Time
On July 16, 2004, Martha Stewart was sentenced to five months in prison and fined $30,000 for her part in the ImClone insider trading scandal. Her broker received a similar sentence for passing on material insider information. Martha's sentence did put the brakes on her media empire during her imprisonment and the time spent rebuilding her image. The media loves second (and third and fourth) chances, so within two years Martha was back on top and has continued to be a media force since.
The First American Millionaire
On July 17, 1763, John Jacob Astor, America's first millionaire, was born. The fourth son of a butcher, Astor left Germany to make it big in the American fur trade. Astor took up a position in the less volatile area of middleman, buying furs from trappers and natives and then selling them for a profit to trading vessels. Astor's American Fur Company quickly became a powerhouse.
Seeing the eventual decline of the fur industry, however, Astor sold and put the proceeds from selling his fur empire into buying the undeveloped land around New York. He bought a considerable chunk of Manhattan and developed it or leased it for development. He later regretted not buying the entire island. John Jacob Astor spent the last years of his life overseeing his vast real estate holdings. He was America's first millionaire and he left most of his fortune to his family, using a small amount for charitable works. The Astor family became the first "old money" family in the U.S. and their extravagant parties and balls were the definition of American upper class. Astor's life became legendary and inspired immigrants from all over the world to come to the land of opportunity and make it rich. Not bad for the fourth son of a butcher.
The Happiest Place on Earth
In 1955, Walt Disney saw the culmination of one of his most ambitious undertakings. Through the 1929 Crash and the Great Depression, Disney's studio continued to grow and advance animation technology. Disney's (NYSE:DIS) animations became a window into a happier world for all the people suffering from a constant stream of bad news. The rights to his creations laid the groundwork for a lucrative merchandising empire, but Disney still needed to mortgage himself to the hilt for his final push in making his creations come to life.
Disney turned a California orange grove into a massive amusement park were people could walk with Mickey Mouse and the complete stable of Disney characters. Opened on July 17, 1955, Disneyland quickly became a very popular and profitable tourist attraction. The amusement park business was tangential to the main film-making core of Disney's company, but it became one of the growth engines for the companies rise into the ranks of the Dow.
What's in a Name?
On July 18, 1968, N M Electronics was incorporated. The name was created from the initials of the founders, Robert Noyce and Gordon Moore, but they soon dismissed it in favor of Intel (Nasdaq:INTC) – a compound from "integrated electronics." Within three years, Intel introduced the world's first microprocessors and provided the hardware that led to the computer revolution. (For further reading, check out From Beads To Binary: The History Of Computing.)
That's all for this week in financial history. Next week will bring a contrast to these positive starts as we delve into Worldcom, the Rigas family and much more. Until then.
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