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09/05/2008

1908

*Bull/Bear reading, 9/10: 38.2 / 41.6

What was it like 100 years ago in America? The following excerpts are from a January 2008 essay in Smithsonian Magazine by Jim Rasenberger. 

“According to the press, everything that happened (in 1908) was bigger, better, faster and stranger than anything that had happened before. In part, this was typical newspaper hyperbole; in part, it was simply true. 

“An essay in the New York World on New Year’s Day of 1908 articulated the wonderment shared by many. The article, titled ‘1808-1908-2008,’ noted how far the country had progressed over the previous century. In 1808, five years after the Louisiana Purchase and two years after Lewis and Clark returned from their transcontinental journey, the population had been a mere seven million souls. The federal government had been underfunded and ineffectual. Technology – transportation, communication, medicine, agriculture, manufacturing – had been barely more advanced than during the Middle Ages of Europe. Now, in 1908, with the U.S. population at almost 90 million, the federal revenue was 40 times greater than it had been a century earlier, and America was on a par with Britain and Germany as a global power. U.S. citizens enjoyed the highest per capita income in the world and were blessed with railroads and automobiles, telegraph and telephone, electricity and gas. Men shaved their whiskers with disposable razor blades and women tidied their homes with remarkable new devices called vacuum cleaners. Couples danced to the Victrola in their living rooms and snuggled in dark theaters to watch the flickering images of the Vitagraph. Invisible words volleyed across the oceans between the giant antennas of Marconi’s wireless telegraph, while American engineers cut a 50-mile canal through the Isthmus of Panama. 

“From the glories of the present the World turned to the question of the future: ‘What will the year 2008 bring us? What marvels of development await the youth of tomorrow?’ The U.S. population of 2008, the newspaper predicted, would be 472 million (it’s 300 million). ‘We may have gyroscopic trains as broad as houses swinging at 200 miles an hour up steep grades and around dizzying curves. We may have aeroplanes winging the once inconquerable air. The tides that ebb and flow to waste may take the place of our spent coal and flash their strength by wire to every point of need. Who can say?’” 

Hampton’s Magazine daringly predicted in 1908. “The citizen of the wireless age will walk abroad with a receiving apparatus compactly arranged in his hat and tuned to that one of myriad vibrations by which he has chosen to be called….When that invention is perfected, we shall have a new series of daily miracles.” 

In October, you had the advent of the Model T, which I’ll cover in more depth next month. Automobiles cost $2,000 to $4,000 in those days but 45-year-old Henry Ford brought his car to market for a mere, “unheard of” price of $850. [$100 extra for amenities including a windshield and headlights.] 

But as Jim Rasenberger writes: 

“It would be wrong to leave the impression that life was a frolic for most Americans. Vast numbers lived in poverty or near poverty. The working class, including some two million children who joined adults in steel mills and coal mines, labored long hours at occupations that were grueling and often dangerous. Tens of thousands of Americans died on the job in 1908.” 

It was also a year when the term “melting pot” found its way into our lexicon, coined by playwright Israel Zangwill “to denote the nation’s capacity to absorb and assimilate different ethnicities and cultures.” 

But the melting pot wasn’t so warm and fuzzy either. Anarchists, gangs of extortionists, “armies of disgruntled tobacco farmers, called Night Riders,” spread terror. Even in Springfield, Illinois, home and resting place of Abraham Lincoln, whites attempted to drive blacks out of town, burning black businesses and homes and lynching two black men. [Because of this particular riot, the NAACP was founded the next year.] 

Yet despite the tumultuous changes taking place, Americans remained hopeful that the future was bright. As Rasenberger notes, “This faith was represented in the aspirations of the hardworking immigrants, in the dreams of architects and inventors and in the assurances of the rich. ‘Any man who is a bear on the future of this country,’ J.P. Morgan famously declared in December of 1908, ‘will go broke.’” 

Rasenberger adds: 

“It’s striking, in fact, how much more hopeful Americans were then than we are today. We live in a nation that is safer, healthier, richer, easier and more egalitarian than it was in 1908, but a recent Pew Research Center poll found that barely one-third of us feel optimistic about the future.” 

Some other tidbits, these gleaned from “The Encyclopedia of American Facts and Dates,” edited by Gorton Carruth. 

1908 was the dawning of the age of the skyscraper. In New York City, the first real ones were erected. The 22-store Flatiron Building was constructed between 1902 and 1904, but in 1908, the Singer Building set a new record, 47 stories and rising to a height of 612 feet. Then one year later you had the Metropolitan Life tower, 50 stories and 700 feet. 1913 brought the Woolworth Building, 55 stories and 760 feet. 

[Today, we have advanced to Taipei 101, which is 1,671 feet, and the soon-to-be 2,300-foot Burj Dubai.] 

Sept. 16, 1908…Incorporation papers for the General Motors Company were filed in Hudson County, N.J., by representatives of William C. Durant, director of Buick. Soon after, General Motors bought Buick and then Olds.  In 1909, Oakland and Cadillac joined the corporation. Chevrolet was added in 1918. 

Nov. 3, 1908…William Howard Taft, the Republican nominee, defeated Democrat William Jennings Bryan, 321-162 in the electoral vote. 

As for the Dow Jones Industrial Average, it closed at 58.75 on 12/31/1907 and 86.15 on 12/31/1908, or a gain of 46.6% for the year. Not too shabby. 

But what was trading volume like then? Recall the markets were open on Saturdays in those days and volume in December 1908 averaged a whopping 1,000,000 shares a day. In July of that year it was more like 531,000. 

[Source: “The Dow Jones Averages, 1885-1995,” edited by Phyllis S. Pierce] 

Lastly, of course 1908 was the year of the Chicago Cubs, who defeated the Detroit Tigers, four games to one, in the fifth annual World Series. Chicago hasn’t won since, but is looking good this year. 

Any discussion of the 1908 baseball season, though, is incomplete without a description of a famous play on Sept. 23, as noted in “The Encyclopedia of American Facts and Dates.” [With my own editorial changes.] 

“Perhaps the greatest dispute in baseball was a call made in what was supposed to be the decisive game, at the Polo Grounds, N.Y., of the Chicago Cubs-New York Giants National League pennant race. In the bottom of the ninth inning with two men on and two out and the score tied at 1-1, New York’s batter singled to center field, plating the winning run. The Chicago players claimed, however, that when Fred Merkle, the man on first, saw the winning run score, he started to walk toward the clubhouse without advancing to second base, invalidating the play. Johnny Evers, the Chicago second baseman, tried to get the ball and tag Merkle out, but the fans streamed onto the field and bedlam reigned. Days later Harry C. Pulliam, head of the National Commission of Organized Baseball, decided to call the game a tie. The teams were forced to play a playoff game, which the Cubs took 4-2. Fans invented the terms ‘boner’ and ‘bonehead’ to apply to Merkle’s play.” 

Wall Street History returns next week.
 
Brian Trumbore



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Wall Street History

09/05/2008

1908

*Bull/Bear reading, 9/10: 38.2 / 41.6

What was it like 100 years ago in America? The following excerpts are from a January 2008 essay in Smithsonian Magazine by Jim Rasenberger. 

“According to the press, everything that happened (in 1908) was bigger, better, faster and stranger than anything that had happened before. In part, this was typical newspaper hyperbole; in part, it was simply true. 

“An essay in the New York World on New Year’s Day of 1908 articulated the wonderment shared by many. The article, titled ‘1808-1908-2008,’ noted how far the country had progressed over the previous century. In 1808, five years after the Louisiana Purchase and two years after Lewis and Clark returned from their transcontinental journey, the population had been a mere seven million souls. The federal government had been underfunded and ineffectual. Technology – transportation, communication, medicine, agriculture, manufacturing – had been barely more advanced than during the Middle Ages of Europe. Now, in 1908, with the U.S. population at almost 90 million, the federal revenue was 40 times greater than it had been a century earlier, and America was on a par with Britain and Germany as a global power. U.S. citizens enjoyed the highest per capita income in the world and were blessed with railroads and automobiles, telegraph and telephone, electricity and gas. Men shaved their whiskers with disposable razor blades and women tidied their homes with remarkable new devices called vacuum cleaners. Couples danced to the Victrola in their living rooms and snuggled in dark theaters to watch the flickering images of the Vitagraph. Invisible words volleyed across the oceans between the giant antennas of Marconi’s wireless telegraph, while American engineers cut a 50-mile canal through the Isthmus of Panama. 

“From the glories of the present the World turned to the question of the future: ‘What will the year 2008 bring us? What marvels of development await the youth of tomorrow?’ The U.S. population of 2008, the newspaper predicted, would be 472 million (it’s 300 million). ‘We may have gyroscopic trains as broad as houses swinging at 200 miles an hour up steep grades and around dizzying curves. We may have aeroplanes winging the once inconquerable air. The tides that ebb and flow to waste may take the place of our spent coal and flash their strength by wire to every point of need. Who can say?’” 

Hampton’s Magazine daringly predicted in 1908. “The citizen of the wireless age will walk abroad with a receiving apparatus compactly arranged in his hat and tuned to that one of myriad vibrations by which he has chosen to be called….When that invention is perfected, we shall have a new series of daily miracles.” 

In October, you had the advent of the Model T, which I’ll cover in more depth next month. Automobiles cost $2,000 to $4,000 in those days but 45-year-old Henry Ford brought his car to market for a mere, “unheard of” price of $850. [$100 extra for amenities including a windshield and headlights.] 

But as Jim Rasenberger writes: 

“It would be wrong to leave the impression that life was a frolic for most Americans. Vast numbers lived in poverty or near poverty. The working class, including some two million children who joined adults in steel mills and coal mines, labored long hours at occupations that were grueling and often dangerous. Tens of thousands of Americans died on the job in 1908.” 

It was also a year when the term “melting pot” found its way into our lexicon, coined by playwright Israel Zangwill “to denote the nation’s capacity to absorb and assimilate different ethnicities and cultures.” 

But the melting pot wasn’t so warm and fuzzy either. Anarchists, gangs of extortionists, “armies of disgruntled tobacco farmers, called Night Riders,” spread terror. Even in Springfield, Illinois, home and resting place of Abraham Lincoln, whites attempted to drive blacks out of town, burning black businesses and homes and lynching two black men. [Because of this particular riot, the NAACP was founded the next year.] 

Yet despite the tumultuous changes taking place, Americans remained hopeful that the future was bright. As Rasenberger notes, “This faith was represented in the aspirations of the hardworking immigrants, in the dreams of architects and inventors and in the assurances of the rich. ‘Any man who is a bear on the future of this country,’ J.P. Morgan famously declared in December of 1908, ‘will go broke.’” 

Rasenberger adds: 

“It’s striking, in fact, how much more hopeful Americans were then than we are today. We live in a nation that is safer, healthier, richer, easier and more egalitarian than it was in 1908, but a recent Pew Research Center poll found that barely one-third of us feel optimistic about the future.” 

Some other tidbits, these gleaned from “The Encyclopedia of American Facts and Dates,” edited by Gorton Carruth. 

1908 was the dawning of the age of the skyscraper. In New York City, the first real ones were erected. The 22-store Flatiron Building was constructed between 1902 and 1904, but in 1908, the Singer Building set a new record, 47 stories and rising to a height of 612 feet. Then one year later you had the Metropolitan Life tower, 50 stories and 700 feet. 1913 brought the Woolworth Building, 55 stories and 760 feet. 

[Today, we have advanced to Taipei 101, which is 1,671 feet, and the soon-to-be 2,300-foot Burj Dubai.] 

Sept. 16, 1908…Incorporation papers for the General Motors Company were filed in Hudson County, N.J., by representatives of William C. Durant, director of Buick. Soon after, General Motors bought Buick and then Olds.  In 1909, Oakland and Cadillac joined the corporation. Chevrolet was added in 1918. 

Nov. 3, 1908…William Howard Taft, the Republican nominee, defeated Democrat William Jennings Bryan, 321-162 in the electoral vote. 

As for the Dow Jones Industrial Average, it closed at 58.75 on 12/31/1907 and 86.15 on 12/31/1908, or a gain of 46.6% for the year. Not too shabby. 

But what was trading volume like then? Recall the markets were open on Saturdays in those days and volume in December 1908 averaged a whopping 1,000,000 shares a day. In July of that year it was more like 531,000. 

[Source: “The Dow Jones Averages, 1885-1995,” edited by Phyllis S. Pierce] 

Lastly, of course 1908 was the year of the Chicago Cubs, who defeated the Detroit Tigers, four games to one, in the fifth annual World Series. Chicago hasn’t won since, but is looking good this year. 

Any discussion of the 1908 baseball season, though, is incomplete without a description of a famous play on Sept. 23, as noted in “The Encyclopedia of American Facts and Dates.” [With my own editorial changes.] 

“Perhaps the greatest dispute in baseball was a call made in what was supposed to be the decisive game, at the Polo Grounds, N.Y., of the Chicago Cubs-New York Giants National League pennant race. In the bottom of the ninth inning with two men on and two out and the score tied at 1-1, New York’s batter singled to center field, plating the winning run. The Chicago players claimed, however, that when Fred Merkle, the man on first, saw the winning run score, he started to walk toward the clubhouse without advancing to second base, invalidating the play. Johnny Evers, the Chicago second baseman, tried to get the ball and tag Merkle out, but the fans streamed onto the field and bedlam reigned. Days later Harry C. Pulliam, head of the National Commission of Organized Baseball, decided to call the game a tie. The teams were forced to play a playoff game, which the Cubs took 4-2. Fans invented the terms ‘boner’ and ‘bonehead’ to apply to Merkle’s play.” 

Wall Street History returns next week.
 
Brian Trumbore