From Elizabeth Holmes to Leona Helmsley and Jeffrey Skilling, this week in Trading History sees a pattern of tax evasion, insider trading and regrettable outbursts...
Frank Winfield Woolworth was born. A pioneer in the discounted store trade, Woolworth opened the first ever five cent store in 1879. It wasn’t until 1911 he pulled together all his different franchises and rechristened them Woolworths. Woolworths didn’t close until over a century later in October 2015. Frank Woolworth did however pass away in 1919.
President Lincoln, the 16th president of the United States, was shot at Ford’s Theatre, dying a day later. The day after the news of his death, the New York Stock Exchange closed out of respect.
If you read last week’s Trading History, you’ll remember we saw the Titanic set sail. On this day, five days into its maiden journey, the Titanic hit an iceberg and sunk the ‘unsinkable’ ship. News of the sinking sent shares of International Mercantile Marine Co., the owners of the Titanic, down as much as 11%.
NASDAQ had its third worst day in history. Due to the backlash of the tech bubble finally popping, the NASDAQ fell 355.49 points or 9.67%. By the end of the week the NASDAQ had fallen a total of 25.3%.
The French Franc dropped to an all-time low of 29.73 to the Dollar. Today the Euro is 0.92 to the Dollar.
Leona Helmsley, the infamous hotel impresario known as the “Queen of Mean”, began her four-year prison term in Lexington Kentucky for tax evasion. Helmsley admitted to evading the IRS but did not see anything wrong with her actions as she believed that the rich and powerful were exempt from the annual IRS ordeal. Let's not forget her unforgivable line “only the little people pay taxes”…
The Texas Gulf Sulphur Company announced that it had discovered a larger copper strike 350 miles north of Toronto. However, unknown to investors, management had known all along about this honeypot and had been frantically buying up the company’s shares prior to this unveiling. This revelation lead to a landmark trial responsible for today’s insider trading laws. The price of Texas Gulf Sulphur company’s shares went from low 30’s and rocketed to over $100 per share.
Elizabeth Holmes, founder and CEO of Theranos, was named one of TIME magazine's “100 Most influential People”. In March 2018, Holmes was charges with defrauding investors of more than $700 million.
The first Ford Mustang was released on this day with a suggested retail price of $2,638. Today the V8-powered Mustang GT starts at around $35,630.
The Dow Jones closed above 3000 for the first time.
CEO of Enron, Jeffrey Skilling, called analyst Richard Grubman an "asshole", over a dispute about Enron’s unusual process of producing financial documents. When Grubman dared to shed some doubts about their accounting processes during a conference call, a disgruntled Skilling replied: “well, uh… thank you very much. We appreciate it. Asshole." … Many believe this outburst was the first card to fall from Enron's wobbling deck. You can listen to the call here
Today is known as “Blue Monday”. Wall Street was in panic after Anthony Morse, a leading stock speculator, failed. Mining companies saw their shares fall more than 90% after the mining bubble of the 1860s finally burst.
A 7.9 earthquake hit San Francisco killing over 3,000 people and destroying over 80% of the city. The San Francisco Stock Exchange remained closed until May 28th. During the next four years, San Francisco quickly bounced back and restored their city.
The secretary of the United Nations warned the world that they could be heading into a recession due to the underlying increase of the price of oil causing trading deficits. The world didn’t see a recession until 1982.
As there isn’t much trading news on this day in history, today marks the birth of Eliot Ness. Ness was known for using the tax code to take down Al Capone. Eliot Ness passed away in 1957.