Sept. 21 has hosted several notable economic developments over the years. Let's take a look at what's happened on this day in market history to better understand how its events have shaped the modern world.
The first automakers
One took place three years before Charles Dow laid down the first 12 stocks of his namesake Dow Jones Industrial Average (INDEX: ^DJI) . Charles and Frank Duryea demonstrated the first standardized gas-powered automobile in the United States on this day in 1893. The Duryea Motor Wagon would soon become the first motor vehicle mass-produced and advertised in the country, and also won the first auto race. The Duryea's one-cylinder open-bodied vehicle was produced until 1917 and would inspire Henry Ford, who called it a "masterpiece," according to a Wired retrospective.
The first auto manufacturer added to the Dow was General Motors (NYS: GM) , in 1915. Six other automakers joined the Dow over the years afterwards. Four, including GM, survive to the present day after significant mergers and restructurings. Only Navistar International (NYS: NAV) , which succeeded International Harvester, has escaped bankruptcy proceedings in its lifetime. GM and Chrysler -- which absorbed earlier Dow automakers Nash Motors and Hudson Motors -- both entered Chapter 11 during the past decade's recession. Mack Trucks, a 1924 inductee, is now a Volvo subsidiary. Nothing remains of Studebaker's automobile manufacturing operations.
The U.S. auto industry now directly employs approximately 2.5 million Americans and sells about 14 million vehicles per year. It generates about $135 billion in taxes each year. The Center for Automotive Research estimates that those directly employed by the auto industry support $500 billion in additional annual compensation over 8 million related private sector jobs. Thanks, Chuck and Frank!
There is a Santa Claus
The year following the Dow's creation helped establish a modern marketing powerhouse. The New York Sun published an editorial on Sept. 21, 1897 titled, "Yes, Virginia, there is a Santa Claus." Santa Claus, a registered trademark of Coca-Cola (NYS: KO) , has been used to sell many billions of dollars in merchandise during a period that seems to start a few days earlier with every passing year.
Most of that was a joke, but the Coke connection is real. Since Haddon Sundblom first rendered the "right jolly old elf" for Coke's 1931 Christmas ad campaign, his white-bearded and red-suited roly poly Santa has become an iconic visual that American children expect to bring them presents every December. From its IPO in 1919 to the 1931 Christmas campaign, Coke's stock grew an impressive 1,000%. From 1931 to the time last year's stockings were hung from the chimney with care, Coke's stock had increased by another 2.1 million percent. Dividends paid per share from 1931 to 2011 totaled an astounding $97,000. That's the gift that keeps on giving.
There and back again
J. R. R. Tolkien first published The Hobbit today in 1937, ensuring that millions of future nerds would have monsters to slay in their parents' basements. Without Tolkien, we would have no World of Warcraft, and Activision Blizzard (NAS: ATVI) would be a much less formidable entity. Peter Jackson would not be fabulously wealthy thanks to three (soon to be six) Hobbit-featuring films to his name.
The direct economic impact Tolkien has had on New Line Cinema parent Time Warner already amounts to billions of dollars in box office receipts alone, and is sure to get much larger in the next few years as three Hobbit films are released. I'm already camped out at my local theater for tickets to the first film. It's a good thing they have free wi-fi here.
A bear begins
The Dow reached 1014.79 at the close of trading on Sept. 21, 1976, its highest point since the beginning of 1973. Every Dow stock save American Brands closed higher. It would mark the highest point of a fairly minor bear market that lasted until 1978, during which the index lost 27% of its value. At the time, hope of lowered interest rates from the Federal Reserve outweighed worries that OPEC would again raise oil prices. Hopes were dashed, but fears came true. Interest rates increased from 5.25% to 18.9% by 1980, and oil prices more than doubled, rising from $14 per barrel to $37 per barrel in the same time frame.
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The article An Earth-Shaking Day of Staggering Importance originally appeared on Fool.com.
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