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This Day in Business History

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August 1

1778		The world's first savings bank opens in Hamburg.
1789		Already mindful of the markets, the newly formed United States government passes the nation's first tariff legislation to protect America's interests in foreign trade.
1941		Ron Brown is born in Washington. Raised in Harlem, Brown served as Commerce Secretary as well as chairman of the Democratic National Committee. Brown died on April 3, 1996, in a plane crash over Croatia.
1995		Westinghouse Electric Corporation buys CBS for $5.4 billion. Founded in 1886, Westinghouse was primarily a power company before making a play to become a media power.
1997		Boeing purchases its archrival, McDonnell-Douglas in a handsome $16.3 billion deal which seemingly made Boeing the king of commercial aircraft production. Investors initially pounced on Boeing's stock, which rose to a high of $60.50 shortly before the deal was closed. However, the buzz quickly wore off when a string of snafus cut into the company's earnings.

August 2

1824		Fifth Avenue, cradle of upper-crust commerce, is founded. America's most fashionable street started as a residential area, albeit a fairly posh one, with residents who didn't take too kindly to the idea of having commercial neighbors. However, in 1906, Benjamin Altman moved his store into an empty space near the corner of 34th Street. He attempted to appease the inhabitants by gussying up his business to resemble a Florentine palace and even left the name of his store off the outside of the building, but residents stormed to new homes farther up the block. The stores, however, kept coming, many outfitted in facades meant to mesh with the tony neighborhood. Along with Oppenheim Collins (1907) and McCreeery's (1913), Tiffany's opened a jewelry store decked out with an entrance that closely echoed the Palazzo Vendramini in Venice. With the opening of the new Lord and Taylor building, which was embraced and even praised in spite of its overtly commercial facade, the era of obfuscation drew to a close. Owners of the block's small stores followed suit, retrofitting their swank exteriors with large display windows. By the dawn of World War I, Fifth Avenue had arrived as a hot-spot for high-class shopping; rents skyrocketed and the small businesses were all but crowded out by big stores able to afford such prime real estate.
1923		Scandal-prone U.S. President Warren Harding dies in office in 1923. On Wall Street the markets dropped a point to close at a month-long low of 105.05.
1996		The government announces unemployment had inched higher and consumer spending had dropped lower. The outcome of the seemingly bad news was that interest rates would stay put for another spell. Euphoria spread through the markets and the Dow closed the day with a gain of 80.72 points. Negotiations pushed into the eleventh hour, but the United States and Japan hash out a new trade agreement, which American officials described as a "significant" step in trade relations between the two nations to establish fair practices for the sale of American computer chips. The two sides agreed to establish a council to monitor trading.

August 3

1894		After a long and violent summer, the strike at the Pullman Palace Car Company is broken. The strike was a seeming victory for management, which had refused to cave in to any of the workers' demands. But the strike, which cost lives and $80,000 in damages and lost wages, aroused public sympathy for the workers while drawing widespread attention to the Pullman Company's "autocratic" ways.
1932		The DOW racks up a 9.52 gain, one of the biggest single day jumps in market history. The increase occurred in the midst of the Depression, though; it ultimately didn't signal a return to flush times.
1981		Tired of working clock-busting shifts on "obsolete" equipment, 13,000 members of the U.S. Professional Air Traffic Controllers Organization (PATCO) walk off the job. President Reagan threatened to fire any workers who were still on the picket line as of August 5th. A good chunk of the controllers stood their ground, though their determination wasn't matched by the media and public relations savvy that now seem necessary for mustering-up popular support. Having seemingly won the battle of public perception, Reagan made good on his promise: citing a law that forbade strikes by federal employees, the President canned 11,500 strikers and decertified the union. A crop of replacement controllers was rounded-up, trained and quickly installed into the vacant positions. The PATCO strike ultimately triggered a protracted retreat by labor, as Reagan's tactics emboldened employers to take a more aggressive stance against union activity.

August 4

1917		Summer heat forces the New York Stock Exchange to close its doors for the day.
1933		The New York Stock Exchange is shut down again, when gas bombs explode near the Exchange building in downtown New York. Though the blasts didn't deter trading, safety concerns led officials to close shop at 12:30.
1997		With their contract having freshly expired, 185,000 union UPS drivers walk off the job, after the Teamsters primed them for months. The Teamsters had tried to hash out a new agreement with UPS, but failure to come to terms on a new pension plan and to put a cap on the use of part-time employees killed the deal. The latter issue especially niggled at the union: three-fifths of UPS employees were part-timers, and four-fifths of the staff picked up during the previous four years worked part-time. Of course, the rub was economic: full-timers made $19.95 per hour, compared with part-time workers, who earned $9 per hour. By striking, the union aimed to halt company business and thus fire back a cash-based salvo at management. Though it took a bite out of the striker's earnings, the gambit worked: a few days after the walkout, UPS' sales volume plummeted 8 percent. With the strike stretching into its second week, and the potential losses mounting higher every day, management ceded to the union's demands. In addition to securing a favorable pension plan, with a raise in retirement benefits, the new agreement called for UPS to boost thousands of part-time workers up to full time status and even dole out a pay raise to the remaining part-timers. Lest the Teamsters claim absolute victory, management warned that any drop in business immediately following the strike would result in lay-offs. Still, the outcome seemingly marked a turning point for labor, which had lost much of its support and leverage during the 1980s. Not only did they score a victory over a major corporation, but also, with some wooing, they won the battle for the public's support.

August 5

1861		The government hands down the first Income Tax as part of the Revenue Act of 1861. The tax, which was levied on incomes over $800, was designed to help fund the Civil War. However, the measure was short-lived, as the government rescinded it in 1872.
1983		Telecommunications giant AT&T splinters into seven regional companies. For a good spell, however, AT&T freely admitted to employing monopolistic practices, reasoning that such tactics would enable them to provide the most efficient service. In place of competition, AT&T welcomed government regulation, "provided it is independent, intelligent, considerate, thorough and just." The government largely bought into this logic, save for a 1956 consent decree which forced AT&T to limit its domain to the national phone system and government contracts. AT&T sailed along, withering stray anti-trust suits and the introduction of modest competition. However, the development of new transmission technology, as well as the rapid advancement of the computer, prompted major changes in the government's trust-friendly philosophy. In 1974, the government brought an anti-trust suit against AT&T and, after a decade of legal wrangling, forced the phone behemoth to divest itself of companies that provided local service. While the birth of the baby Bells hardly whittled AT&T into a mom and pop shop, the ruling still took a chunk out of their mammoth operations. Their assets suddenly shrunk from $149.5 billion to $34 billion and the workforce was trimmed from 1.9 million to 373,000 employees. After hitting a sky-high 10 percent in July 1983, the nation's unemployment rate cools down a bit as figures released show that half a million Americans returned to work, dropping the unemployment rate to a still hefty 9.5 percent.
1991		Soichiro Hondo, CEO and founder of Honda Automotive, dies of liver cancer at age 84.

August 6

1837		The Dow reaches the peak of an unseasonable run that started on May 31. During the summer-time streak, the Dow Jones industrial average gained 37.93 points, inspiring false hopes that the nation would soon recover from the bank-induced panic of '37.
1846		Secretary Robert J. Walker reinstalls the Independent Treasury System. Walker also inaugurated a system for warehousing imports that endures to this day.
1993		Bill Clinton's budget plan squeaks by the Senate in 1993. The budget was passed on a 51-to-50 vote, as Vice President Al Gore weighed in with the tie-breaking ballot.
1997		Microsoft pays $150 million for a minority stake in its struggling rival, Apple Computers. Shacking up with the enemy made sense for Apple, which was veritably squashed by Microsoft in the race to sew up the home computing market. The deal helped Apple on Wall Street, initially sending the company's stock up $6.5625, to close at its highest price in over a year. The real questions concerned Microsoft's motives, though the investment, which was for a nonvoting stake in the company, was seemingly a pragmatic business move since Microsoft was, and remains to be, the largest seller of various software programs for Macintosh computers. The investment had other perks as well, including the provision that made Internet Explorer, Microsoft's software for tooling about the World Wide Web, the standard browser on Macintosh personal computers. Of course, the deal had its detractors. When Microsoft's investment was announced at the Macworld tradeshow in Boston, the room burst into a chorus of boos. Apple honcho Steve Jobs, who but a year ago had accused Microsoft of making "really third-rate products," chided the audience. "We want to let go of this notion that for Apple to win, Microsoft has to lose. We better treat Microsoft with a little gratitude." Jobs's appreciation seemingly hasn't been misplaced: since Microsoft's investment, Apple has staged something of a comeback, with their balance sheet making a consistent return to the black.

August 7

1794		Irate farmers in the Monoghaela Valley of Pennsylvania rise up against the federal tax on liquor and stills. During the so-called Whiskey Rebellion, the farmers extracted their revenge by torching tax collectors' homes, as well as "tarring and feathering revenue officers." The government moved quickly to quell the rebellion: President Washington called in 12,900 Federal troops from to surrounding states to forcefully usher the farmers back to their homes.
1928		The Treasury unveils a new version of the dollar note that was one third smaller than its predecessor, and promised that they would begin production on a new two-dollar note. The dinky dollar was part of a fleet of smaller bills: the Bureau of Engraving and Printing ran the presses to the tune of one billion new bills in denominations ranging from one to ten thousand dollars. Lest the public grow bored with their existing money, the Treasury kept on fiddling. A year later the department rolled out yet an even smaller version of the dollar. The bill had shrunk by 25 percent and was graced with the now standard set of portraits and emblems.
1997		Federal Reserve chief Alan Greenspan takes the stage at the Center for Financial Studies in Frankfurt, Germany and tells the crowd that the Federal Reserve is looking for ways to steer America's fiscal future. "The Fed is struggling to find a firmer standard of monetary policy," he explained. Greenspan also touched on inflation, praising Germany and other industrialized nations' "remarkable" efforts to reign in their currency rates.
1942		American marines hit the long and bloody road to Tokyo, landing in Guadacanal and two other Pacific Islands; the Dow stands its ground, rising slightly by 0.25 points to close at 105.05.

August 8

1903		Led by the Western Federation of Miners and famed union man "Big" Bill Haywood, the miners in Cripple Creek, Colorado walk off the job. The strike was called after the Mine Owners' Association refused the workers' demand for eight-hour days. However, the owners had the last laugh: suspicions that the strikers has set off an explosion that killed several non-union miners gave the owners the leverage to bust the strike and drive Haywood from Cripple Creek.
1951		The U.S. Customs Agency moves to protect consumers from fraud by passing the Fur Labeling Act, which required manufacturers to include labels that identified the species of animal and whether paws or tails were used.
1968		U.S. President Lyndon Johnson had contracted a minor colon ailment and the report didn't sit so well with Wall Street, despite the doctors' assurances that the condition--diverticulosis--was not serious. LBJ apparently felt no discomfort and had in fact developed the minor illness in 1960. Still, investors engaged in "precautionary selling" and the Dow took a 6.55 point tumble to close the day at 870.37.
1974		The markets decline as Richard Nixon steps down from office. Nixon's decision was considered something of a fait accompli: the President was embroiled in the Watergate scandal and had little choice but to throw in the towel. The markets responded in kind, as the Dow dropped 12.67 points. However, prior to the decision, Wall Street, mired in a prolonged funk, actually staged a brief "Nixon rally." The inevitability of his decision sparked trading, and in the three days leading up to the resignation, the DOW jumped forty-five points. Unfortunately, the President's announcement deflated the markets, as a chorus of analysts prophesied dark days for Nixon's successor, Gerald Ford. Ford was inheriting a nation sinking under the weight of various economic woes, including rising inflation and unemployment rates. Gazing into his crystal ball, one broker predicted that if Ford couldn't stem the tide of inflation, "a change in Presidents" wouldn't "have much effect on the stock markets."

August 9

1929		Wall Street gets an inkling of the upcoming crash as the New York Bank raises the rediscount rate on loans to brokers a full point to 6 percent. The hike was precipitated by the unsettling news that brokers had racked up a record $6 million debt, the fourth time during August 1929 that their loans had swelled to record levels. Still, bankers assured the business community that the move, which was the biggest raise to the rate since the close of World War I, wasn't cause for alarm. Soothing words aside, reports from the day note that the new rate did indeed catch Wall Street by surprise. The following day the Dow dropped 14.11 points to close at a month-long low of 337.99. Until that point, investors had been reveling in "Big Bull Market," a record-setting run which was well over a year old. As the Dow hit new highs, the stock market became a national past time; the craze for playing the stocks spread from being the sole province of the big-city elite to a part of the daily life of small-town America. However, as the Reserve Bank's move to advance the interest rate oh-so-subtly suggested, the good times were based on speculation rather than solid financial practices. By November 1929, this quiet hint at a downturn in the market would look more like a prophetic warning call.
1996		Facing a seemingly hopeless race for the White House, Republican Presidential nominee Bob Dole uncorked a plan for a $548 tax cut. While tax cuts usually make hay with the public, the move did little to boost Dole's sagging fortunes in the campaign against incumbent Bill Clinton.
1997		Already reeling from a full plate of lawsuits, the tobacco industry takes another hit when a Florida court awards $750,000 to a man who claimed that he had been fatally addicted to cigarettes for over 50 years. The ruling took a bite out of various tobacco stocks, including B.A.T. Industries, the parent of Brown & Williams, the company found guilty in the case. None of this sat well with the Dow, which dropped 32.18 points to close the day at a still smoldering 5,681.31 points.

August 10

1955		In a moment of harmony between management and labor, the workers at the Studebaker factory in South Bend, Indiana choose to take a pay cut as a means to help the company. Despite the agreement, which trimmed workers salaries from $20 to $12, the company soon went belly-up.
1962		The price of silver climbs up to $1.08, its highest since 1920.
1987		With the markets in the late stages of its record-setting Bull Run, the Dow Jones Industrial Average cracks the 2,600-point ceiling, picking up 48.84 points to close the day at 2,635.84. A few months later the bubble burst and the Dow plummeted by 500 points.
1995		Netscape, developer of Navigator, popular software for cruising around the World Wide Web, goes public with what turned out to be the largest Initial Public Offering (IPO) in Wall Street history. The California-based company issued five million shares of stock, which were slated to trade at $28. By the close of the trading day, Netscape's stock had zoomed up to $72 a share, which left the company with a tidy market value of $1.96 billion. These were pretty flashy figures for a 16-month-old concern, which had produced nothing but a single piece of software. Of course, that software helped transform the Web from an arcane academic tool and computer curiosity into a lucrative fixture of late 1990s American life. Naturally, the breathless hype and handsome profits surrounding Netscape weren't lost on other developers; industry giant Microsoft unleashed its own software for tooling about the Web. Since releasing Internet Explorer, Microsoft has used a barrage of advertisements, as well as questionable business tactics, to claim a good chunk of the Web browser market. Needless to say, this hasn't been a boon to Netscape's finances, which have flagged considerably since that golden day in the summer of '95. In January of 1998, the company reported losses totaling $115 million, which triggered downsizing plans as well as a bevy of takeover rumors.

August 11

1919		Andrew Carnegie, alternately known as the king of steel, architect of the second Industrial Revolution, friend of capitalism, and scourge of workers, passes away. Carnegie's life story is a classic bit of American mythology: born in Scotland, he immigrated to America at age 13 and started his career as a bobbin boy in a cotton factory. Thanks to a ferocious competitive streak, and a bit of luck--one of his farms was perched atop an oilfield--Carnegie soon left the factory floor for the boardroom. An early proponent of consolidation and vertical integration, Carnegie racked up his fortune--and effectively monopolized the steel industry-- by controlling everything from raw materials to the means of production. Though he was raking in millions of dollars, Carnegie eventually heeded the urge to return to Scotland, where he embarked upon a plan to die penniless. Before contracting a fatal bout of bronchial pneumonia, Carnegie had successfully burned through a good bit of his riches, some of which he used to finance various schools and institutes.
1997		Struggling publishing giant HarperCollins announces that it would write off some 35 percent of its value--$270 million--as a move to dissuade its parent company, News Corp., from putting it on the selling block. News Corp., Rupert Murdoch's global media behemoth, in turn announced that rather than sell HarperCollins, it intended to use the money to revamp the company. The $270 million charge against earnings was one of the largest write-offs in industry history. A merger deal was is struck between Amscam Holdings Inc., a New Jersey-based plastic and paper party goods company, and Confetti, an affiliate of Goldman, Sachs & Co. The agreement, worth roughly $315 million, gave a nearly four point boost to Amscam's stock on the NASDAQ market.

August 12

1902		New Jersey-based farm machinery giant International Harvester Company, backed by $120 million in capital, opens its doors on August 12, 1902. Though International Harvester quickly usurped the market--at one point it produced 85% of all machinery--the company's "moderate" business tactics shielded it from trustbusters and anti-monopolists.
1932		In one of the steepest declines in market history, the Dow drops a precipitous 8.40 points. The decline came a week after the markets posted encouraging gains, thus squelching hopes that the Depression was drawing to a close.
1981		IBM introduces its Personal Computer (PC). Their new product sold 136,000 units in its first year and a half of release, propelling the company's stock on an upward climb that peaked later in the decade. IBM, the granddaddy of business computing, was seemingly making a break from the boardroom and looking to conquer America's homes. Not as widely noticed was the fact that IBM's new machine was a pastiche of other companies' components, including a processing chip courtesy of Intel and an operating system developed by a 32-person concern called Microsoft. Eventually, IBM would not only be relying on other companies' technology, but would be chasing them for profits. Though recent years have been a touch kinder to the company, the early 1990s saw IBM posting annual losses that sometimes ballooned up to $8 million.
1982		The Dow drops to 776.92. However, the next day, the markets would kick off a heady five-year run in which the Dow flirted with the 3000 point barrier. The Bull Run of the '80's finally snapped in 1987 with a 500-point crash.

August 13

1925		The Baltimore Chamber of Commerce accuses journalist H.L. Mencken, and more specifically his dispatches from the Scopes Monkey Trial, of disturbing the city's trade with the South. Mencken, who was famed for his way with a well-crafted put-down, painted a less than flattering portrait of Dayton, Tennessee, the deeply Christian site of the trial. In one of his choicer offerings, Mencken noted that in Dayton "there is no gambling. There is no place to dance. The relatively wicked, when they would indulge themselves, go to Robinson's drug store and debate theology."
1962		While laying out his economic plans for the coming year, U.S. President John F. Kennedy promises an "across-the-board, top-to-bottom" cut in corporate and personal taxes, due to take effect on January 1, 1963. The pledge tickled Wall Street's fancy and the Dow shot up 6.61 points the next day. While history usually chooses to remember JFK as a liberal architect of government, the tax cut was in fact rooted in conservative economic theory. The President and his advisors spun their fiscal plans from the theories of John Maynard Keynes, which they interpreted as a dictate to use tax policy as a means to induce demand and trigger growth without the attendant evil of inflation. Of course, the downside to the policy was the ripe potential for piling up a budget deficit, but Keynes and his acolytes viewed debt as an acceptable by-product of an otherwise healthy economy. Despite the risk of debt, and a chorus of detractors who derided the cut as a handout to the wealthy and corporations, the legislation passed through the House with relatively little fuss. When the cut came down in 1963, it slashed individual taxes by about 1/5 and corporate taxes by 1/10. All told, the measure pumped $12 billion into the economy, which, given your take, either stimulated record growth or was a whopping gift to the nation's wealthy citizens.
1987		Wall Street celebrates the five-year anniversary of the dawn of the Bull Run by shortly surging past the 2,700-point mark. The Dow Jones Industrial Average closed the day at 2,691.49.
1991		Inventor and entrepreneur Jack Ryan, who helped give birth to Barbie and Hot Wheels racing toys, dies at age 65.
1996		Donald Trump strikes again, with a plan to build a 140-story home for the New York Stock Exchange. Friends and family of Trump explained that the hyper-rich developer felt strongly that New York should be home to the world's tallest building. The idea initially tickled Exchange officials and Trump even enlisted the aid of the architects who designed Malaysia's skyscrapers, but the "Exchange Tower," like so many of the Donald's projects, never came to be.

August 14

1896		Prospectors find gold in the Yukon Territory of Canada. The gold rush that hit California earlier in the century headed north, as over 30,000 people stormed to the Yukon to find their bit of fortune.
1923		Though its late founder wasn't always the best friend of labor, Carnegie Steel establishes the eight-hour day for its workers.
1935		The Social Security Act is passed; the roots of the legislation can be traced back to the crash of 1929. No one was particularly well prepared for the ensuing Depression, including the elderly. Government surveys taken during 1934 estimated that more than half of the nation's elderly lacked the means to support themselves. Clearly the country needed some sort of system for providing for its aging citizens. Various plans were hatched, including State-run pension programs, while America's leftist leaders marshaled surprising support for their economic proposals. But, as 1935 chugged along, the nation was still in need of a pension program. New Dealing U.S. President Franklin D. Roosevelt finally pushed a proposal through the legislative chain. Compared to some of the other solutions developed at the time, the Social Security Act was relatively moderate: the bill mandated the now familiar "contributory system" in which workers forked over part of their salaries to a joint pension fund. Shortly after the passage of the bill, the government wheeled into action, creating an elaborate system for collecting, collating and doling out pensions. By January 1937, the Social Security program was open for business. Over the years, Americans have socked away over $4.5 trillion in the fund, while more than $4.1 trillion worth of benefits have been paid out to the nation's retired citizens.
1987		The U.S. government announces that the nation's trade deficit had swelled to $15.7 billion. This wasn't exactly novel news; the nation had been steadily adding to the already hefty trade deficit throughout the decade.

August 15

1945		Sensing that the ticker tape would be better used as a shower for returning soldiers, the New York Stock Exchange shuts its doors to celebrate the end of World War II. The Exchange opened again for trading on August 17.
1971		Richard Nixon announces a sweeping series of economic initiatives, including a 90-day freeze on wages and rents, as well as the end of America's 25-year-old policy of converting foreign money into gold. While the President hailed these measures as the keys to a "new prosperity," the reality was that the economy was suffering from maladies that included the strain of providing both the raft of Great Society programs and the guns used to wage the Cold War. As a result, inflation and unemployment were on the rise, while the government racked up a hefty national debt and trade deficit. The day following Nixon's announcement, the Dow Industrial Average shot up 32.93 points. But the revival was short-lived, as the Dow retreated downward when it became clear that economy wasn't going to be easily revived. By the time Nixon tendered his resignation, it was painfully clear that his measures were not about to lead to any sort of prosperity: debt, inflation and unemployment kept mounting, as the country struggled through a slump that didn't lift until the 1980s.
1986		The Treasury Department enters the computer age, as the first securities were produced using the digital "Treasury Direct" system.

August 16

1841		Former Whig ally President John Tyler vetoes a bill that would have established the Second Bank of the United States. The move sparked a riot outside the White House, as incensed--and drunk--members of the Whig party bombarded the White House with stones, fired their guns in the air and burned Tyler in effigy. In response to the outburst--which still stands as the most violent demonstration ever held outside the White House--the government formed the District of Columbia's police force.
1894		George Meany, the first and perhaps one of the most enduring presidents of the American Federation of Labor and Congress of Industrial Organizations, is born in New York.
1978		Xerox is forced to fork over a $25.6 million fine for blocking Smith-Corona out of the lucrative photocopier market. Xerox's dominance can be traced back to the 1960s, when the company hit pay dirt by commercializing "xerography," better known as the process of photocopying. Xerox used a fleet of patents to lock-up their technical knowledge and effectively put the kibosh on the competition. While it was great for their balance sheet, Xerox strong-arm tactics didn't sit so well with the Federal Trade Commission; the Smith-Corona ruling was part of a bigger push to break Xerox's hold over the copier market. The government ordered the copier king to share its technology with the competitors which, along with the Smith-Corona decision, effectively busted Xerox's trust. By 1989, the company had lost half of its market share, including a chunk to companies which benefited directly from the government's rulings. But Xerox still holds the top spot in high-end and mid-range machines, with annual revenue of $10 billion in the U.S. and $16 million worldwide.

August 17

1939		After refusing U.S. requests to enter into peace agreements and breaking a non-aggression pact with Poland, Hitler had readied his troops to seize the Polish port city of Danzig; the markets react by posting their biggest decline since July. Bond ratings followed suit, prompting fears that the troubles in Europe would torpedo whatever progress the American economy had made since the Depression. But a funny thing happened on the way to the war--America's economy grew stronger. As the nation ramped up for action, there was a wholesale increase in the production of war-related utilities. The government spent millions on preparing for the war and the defense industries surged with activity. By the end of 1939, unemployment posted a healthy decline and the index of industrial production had skyrocketed; the index and national income kept getting fatter, peaking between 1944 and 1945. Of course, some of Wall Street's fears came true: the rate of inflation jumped when the war began and various necessities had to be rationed. But Wall Street's misgivings were otherwise misplaced: the war helped kick-start the American economy, pushing it from a lingering Depression-era funk into a prolonged state of abundance.
1985		Though the Hormel Company had been reeling in record profits, management decides to slash wages and benefits, prompting workers at the Austin, Minnesota, plant to call a strike. The ensuing walkout lasted 25 weeks, during which time the local union squabbled with the national leaders, and the Minnesota State Police and National Guard were called in to keep the peace. Hormel, until then best-known as the maker of Spam, broke the strike by calling in replacement workers.
1989		After a decade of piling up debt, the U.S. Commerce Department announces that the nation's trade deficit had slimmed down to $8.7 million during the month of June. It was the lowest figure for the deficit since 1984.

August 18

1966		The first batch of redesigned $100 bills featuring the now-familiar motto "In God We Trust" are printed.
1970		The Chicago Board of Trade posts the single biggest day of trading in its 122-year history when a record 309 million bushels of grain changed hands, which bested the previous record by 13 percent.
1982		Wang Laboratories falls prey to the intense competition of the computer industry and files for Chapter 11. It was a hard fall for one of the industry's oldest and most ambitious companies. The brainchild of An Wang, a Chinese-born computer whiz with a Ph.D. from Harvard, Wang Laboratories was founded in the 1951 and grew profitable as a major supplier of microcomputers. By the 1970s, the company had become a "multi-national colossus." However, Wang's headstrong tendencies--he was once described as a "humble egomaniac"--coupled with the company's failure to keep pace with the Personal Computer eventually eroded profits. On the eve of declaring bankruptcy, Wang's stock shrunk to $.75 a share. However, the world had not heard the last of Wang: the company was reborn in 1993 (and is known today as Wang Global) and has become a leading systems integrator and provider of information technology services worldwide.

August 19

1785		Congress empowers the U.S. Treasury Board to standardize the nation's weights and measures.
1841		The first set of standard bankruptcy laws hits the books throughout the U.S. While the laws were repealed a few years later, they proved popular during their brief tenure, with 33,737 people utilizing the newfound right to voluntarily declare for bankruptcy.
1848		The New York Herald lets the East Coast know that gold was discovered in California in January 1848. There had been rumors, but people remained skeptical without an official report. The Herald's story, coupled with an official confirmation by President James Polk, erased any doubts, and people went to find their fortune in America's Wild West. Those who made it to California after a long, arduous, and sometimes deadly journey found boomtowns filled with everyone from entrepreneurs to unscrupulous shysters, all practicing their own brand of unfettered capitalism. People earned money by providing various services to miners. Demand for domestic skills, such as washing clothes, meant that for the first time women could charge healthy rates for their work. A shortage of women in the West created even easier ways of making money: One man charged $5.00 for the privilege of gawking at his fiancée during their wedding. But gold was not so easy to come by, and while some miners found their fortunes, the gold rush ruined many other people who had picked up their lives and made a mad dash for money that they never found.

August 20

1862		In the mid-1800s most people worked ten- or twelve-hour days, prompting the newly formed National Labor Union (NLU) to call on Congress to officially trim the workday. While Congress didn't heed the NLU's pleas, the union's efforts pushed the issue onto the national stage. The public picked up the call for shorter hours, as did some legislators: federal employees were the first to enjoy truncated days when Congress passed appropriate legislation in 1863.
1996		President Bill Clinton gives his approval to a 90-cent hike in the minimum wage. The increase, which brought minimum pay to $5.15 an hour, was the first time the wage had received a boost in five years.

August 21

1862		As the economy took a beating from the Civil War, the Treasury Department releases fractional currency, alternately known as postage currency, and the new 5, 10, 25, and 50-cent notes hit the streets.
1987		The bull run tops out at a then-unprecedented 2772.4 points. There were some strong economic signs--158 companies on the NYSE had split their stock. In some ways, however, the summer of '87 was a difficult time for Wall Street. Interest rates were nearing the double-digit barrier and stories were flying about brokers bracing themselves for doom. Wall Street was also engulfed in scandal; the Securities Exchange Commission (SEC) was hauling in tax evaders and insider traders in a string of highly publicized cases, and traders were getting arrested for using and peddling cocaine. So it was no surprise when, on October 19, the good times came crashing to a halt as the Dow lost a record-setting 508 points.
1997		After the value of its shares steadily slid during the late '80s and early '90s as Microsoft and other upstarts made an end run on the home-computing market, IBM stock bursts to a new high of $177.125 before closing the day at $173.625. Though Big Blue had slipped to number three in the technology field, its rising stock price was seen as a sign of renewed fiscal health.

August 22

1959		Family maid Anne Marie Rasmussen marries into money when she weds Stephen Rockefeller of the esteemed Rockefeller clan.
1992		Democratic challenger Bill Clinton uncorks the first in a series of sharp attacks on President George Bush's economic record, and the economy cooperates with Clinton's rhetoric: the dollar sank to a record low against the German mark, while the Dow continued to slump its way through the summer. As the presidential race heated up, the Arkansas governor dismissed Bush's proposed set of tax cuts as "fools gold." Clinton also branded Bush a "liar," warning that the president had failed to keep his pledge not to raise taxes and would only continue to betray the American public. Though Clinton lacked national experience and was plagued by questions about his personal life, his economic oratory proved potent enough to eventually help him win the election.
1997		Just a few days after the pro-union outcome of the UPS strike, reigning Teamster President Ron Carey is forced to step down from his seat atop the organization. The move was part of Election Commissioner Barbara Zack Quindel's ruling that Carey's successful bid for the presidency against James Hoffa in 1996 may have been swayed by illegal campaign contributions. In the election, Carey beat Hoffa by 16,000 votes, or less than four percent of the vote.

August 23

1939		Lloyd's of London advances war-risk rates as the Nazis threatened to invade Poland and Europe braced itself for war. The Dow responded to the news with a 3.25 drop to close the day at 131.82.
1989		The markets take a nosedive and the Dow loses 76.73 points just a month after it nearly broke the 3,000 point barrier. The culprit for the decline was Wall Street's increasing fears about the Persian Gulf crisis, which began in early August when the Iraqi army rolled into the oil-rich territory of its neighbor, Kuwait. Iraqi leader Saddam Hussein openly declared his intention of annexing Kuwait, prompting President George Bush to deride the invasion as an act of "naked aggression." As Bush and Hussein faced off, oil prices marched upward, in turn triggering the sell-off on Wall Street. Fears of war and escalating prices were written all over the markets: during the week of the 23rd, the Dow lost 6 percent of its total value.
1996		The U.S. Commerce Department releases news that the durable goods orders had exceeded expectations. Already fearful that the '90s stock market bonanza was about to go bust, Wall Street took the report as a sign that the good times were perhaps about to draw to a close. The Dow dropped by 22.75 points and the price of the 30-year Treasury bond took a dive, sparking a round of inflation jitters.

August 24

1814		The British set fire to the main Treasury Building in Washington, D.C. before heading across the street to take a meal at the Rhodes Tavern.
1827		The inaugural issue of The Mechanics Gazette, America's first labor newspaper, is published in Philadelphia.
1857		The New York branch of the Ohio Life Insurance and Trust Company hits the skids and takes the economy with it, plunging America into the Panic of 1857. The Ohio Life closing was neither a surprise nor the sole reason for crisis: America had been boom-busting its way through the 19th century, riding rampant overspeculation in railroad and real estate securities to bursts of development which were inevitably followed by bad droughts. The pattern held true with the Panic, which had been preceded by a flush period of expansion. This particular crisis was brief but painful: 4,923 businesses closed before the end of the year. Eastern cities were ravaged by unemployment, prompting people to take to the streets to protest joblessness and hunger. The financial fog finally lifted by 1859 and development once again charged ahead.

August 25

1819		Fabled crime fighter Allan Pinkerton, who was involved in one of the bloodiest incidents in economic history, is born in Glasgow, Scotland. Pinkerton founded a detective agency in Chicago that originally gained fame for solving a series of train robberies and later became known for helping management break strikes by the new labor unions. During the summer of 1892, his distaste for unions led Pinkerton to lend a hand to a fellow Scot, Andrew Carnegie. Tired of working in extreme heat for long hours and little pay, the workers at Carnegie's Homestead plant in Pennsylvania had threatened to strike. In response, Carnegie's partner slashed wages and erected a wall around the plant, effectively forcing a walk-off. Replacement workers were hired and Pinkerton's detectives were enlisted to ensure the workers safe passage to the plant. However, the appearance of Pinkerton's men led to violence, as the strikers and detectives clashed. Nine detectives died and 19 of the striking workers were eventually hung for crimes related to the incident.
1923		Television game show impresario and master deal maker Monty Hall is born. During his reign on Let's Make a Deal, which aired from 1963-1976, Hall doled out prizes to contestants in silly costumes who vied for the spotlight and the opportunity to choose what was behind curtain number one or curtain number two.
1996		The Dow bursts past its old highs to close the day at a record-setting 3,652.09. Much to the delight of investors, this mark was short-lived, as stocks continued to charge higher throughout the decade.

August 26

1932		In a move to offer some relief to the public from the Depression, the controller of currency announces a temporary halt on foreclosures of first mortgages.
1966		After a four-year period of growth and gain, the markets post their first significant drop. The Dow sunk to 776.22, a decline which effectively wiped out half of the gains the markets had racked up during the run, which stretched from a missile-crisis low in '62 to a peak in the winter of '66. It was a whisper of the tough economic times that would come with the dawn of the '70s.
1994		One of America's most notorious fugitives, financier Robert Vesco, finally lands in jail on a 13-year sentence for "economic crimes against the state." The Detroit native was found guilty of defrauding Cuba's state-run pharmaceutical agency during the development of TX, a plant-based "wonder drug" that was reputed to help prevent AIDS and cancer. It wasn't the first time that Vesco had run afoul of the law: in the early 1970s he was charged with making illegal contributions to Richard Nixon's reelection campaign. The government indicted the financier, but rather than serve time, he fled to Latin America. Vesco was also charged with trying to swindle mutual fund investors out of $224 million.

August 27

1894		The first graduated income tax, nestled into the Wilson-Gormann Tariff, a major piece of trade legislation, is passed by Congress. Both the income tax and the tariff had their high-powered critics; President Grover Cleveland refused to sign the bill on the grounds the tariff provisions were too protectionist. Meanwhile, the tax law became mired in legal wrangles. The Supreme Court effectively squashed it in the ruling on Pollock vs. Farmers' Loan and Trust Company. The Court interpreted the income tax as a direct tax which, according to the Constitution, isn't within the federal government's legislative powers. The Wilson-Gormann Tariff only served to put the income tax on the legislative map. With the passage of the Sixteenth Amendment in 1913, the tax made its way into America's law and pocketbooks.
1979		In the hope of giving some advantage and assistance to taxpayers, the IRS devises the position of Taxpayer Ombudsman, who is charged with serving as the "taxpayer's advocate in resolving problems."

August 28

1814		The War of 1812 is still going strong as British capture a large portion of the East Coast, including Washington, D.C., prompting New York banks to halt specie payments.
1933		To safeguard U.S. gold supplies as the Depression rolled on, the government hands down an executive order that prohibited "hoarding" gold and placed limits on exports of precious metal.
1941		President Franklin Roosevelt hands down an executive order establishing the Office of Price Administration (OPA). Charged with controlling consumer prices in the face of war, the OPA imposed rent controls and a rationing program which initially targeted auto tires. Soon, the agency was churning out coupon books for sugar, coffee, meat, fats, oils, and numerous other items. Though goods were in tight supply, Americans were urged to stick to the system of rationing. Some even took the Homefront Pledge, a declaration of their commitment to avoiding the black market in favor of buying the OPA way. The end of the war didn't prompt an instant shutdown of the OPA. Reasoning that some goods were still quite scarce, President Truman kept the agency running. However, the existence of a government agency for regulated prices and production didn't sit well with some people. Big business bristled at the controls, as did farmers, who suffered under continued meat rationing. Soon after the '46 election, the OPA was relieved of its duties, with only rents, sugar, and rice still subject to controls. The agency's record of service during the war was fairly impressive: by V-J, consumer prices had increased by 31 percent, a number which was noticeably better than the 62 percent bloating of prices during World War I.

August 29

1862		The Bureau of Engraving and Printing is founded. The bureau began as a relatively humble enterprise: housed in the basement of the Treasury Building, the original "money factory" had a staff of six who didn't print a single note, but instead separated the bills produced by private companies. The bureau started printing notes in 1863, and by 1887, had assumed full responsibility for producing the nation's currency. Along the way, the bureau grew from six to 2,800 employees, spread over two offices in Washington, D.C., and a branch in Fort Worth, Texas. Today, the bureau annually churns out about 6.5 billion notes worth $80 billion.
1938		Robert Rubin, who served during the Clinton Administration as the nation's 70th secretary of the Treasury, is born in New York City.
1941		Robin Leach, the jet-setting host of the popular '80s television show Lifestyles of the Rich and Famous is born in London, England. The show, which debuted in 1984, provided viewers with a look inside the private retreats of actors and musicians, and celebrated all the things that (a lot of) money could buy.

August 30

1935		President Franklin Roosevelt's Revenue Act, which aimed to take a cut out of the nation's fattest pocketbooks, is passed into law. Aptly referred to as the Wealth Tax Act, the legislation increased taxes on rich citizens and big business, while lowering taxes for small businesses. Though the taxes were a seeming boon to a nation mired in the Depression, they raised the hackles of business leaders and the wealthy elite. The president, himself a child of affluence, was branded a "traitor to his class," as well as a Communist. The Revenue Act hardly paved the way for a wholesale redistribution of wealth, but it did seek to rectify the imbalances in the American economy. "Our revenue laws have operated to the unfair advantage of the few," FDR reasoned when the act passed. "They have done little to prevent an unjust concentration of wealth and economic power."
1994		Lockheed and Martin Marietta ink the paperwork on a merger that created one of the world's largest aerospace/defense companies. The newly formed Lockheed Martin Corporation continued to acquire other companies, including Loral and Unisys Defense.

August 31

1839		The U.S. Treasury Department moves to its headquarters at 15th Street and Pennsylvania Avenue in Washington, D.C. The Treasury Building was designed in high Greek Revival style by architect Robert Mills.
1939		The Public Examining Board, which had been formed to "study customer protection," releases a set of solutions to the problem of post-crash trading. The Board's 14 recommendations ranged from fuller disclosure of brokerage firms' financials to beefing up the minimum capital requirements for commodity accounts. This wasn't Wall Street's first encounter with regulation. Earlier in the decade, the government responded to the swirl of corruption and impropriety surrounding Wall Street by handing down a Securities Act in 1934, as well as a related measure in 1935. Along with imposing tighter controls, these bills also paved the way for the formation of the Securities and Exchange Commission (SEC), which was in full swing by 1939, monitoring the markets and meting out punishments. While these measures were designed to safeguard customers, the investment community chafed at them, accusing President Roosevelt and his administration of being "anti-business."

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