On this day in economic and financial history ...
The electric light bulb, naturally, came first. The first string of Christmas lights came quite close on its heels. On Dec. 22, 1882, Only three years after Thomas Edison developed a successful electric bulb, and two years after parlaying this innovation into the seeds of General Electric (NYSE:GE), his close compatriot and frequent business partner, Edward H. Johnson, took those bulbs and used them to decorate his Christmas tree.
The sight of an illuminated tree as fascinating to the people of 1882 as the most elaborate music-synchronized Christmas-light shows are to people today. A Detroit Post and Tribune reporter wrote of the illuminated tree with a sense of awe:
[The tree] was brilliantly lighted with many colored globes about as large as an English walnut and was turning some six times a minute on a little pine box. There were 80 lights in all encased in these dainty glass eggs, and about equally divided between white, red and blue. As the tree turned, the colors alternated, all the lamps going out and being relit at every revolution. The result was a continuous twinkling of dancing colors, red, white and blue, all evening.
I need not tell you that the scintillating evergreen was a pretty sight -- one can hardly imagine anything prettier. The ceiling was crossed obliquely with two wires on which hung 28 more of the tiny lights; and all the lights and the fantastic tree itself with its starry fruit were kept going by the slight electric current brought from the main office on a filmy wire. The tree was kept revolving by a little hidden crank below the floor which was turned by electricity. It was a superb exhibition.
Johnson went big with this display. When was the last time you saw a rotating Christmas tree?
Edison retained the patent to the electric bulb, and General Electric made great use of it beginning in 1892, when it acquired the patent rights. The first Christmas lights went up for sale in 1900 in Scientific American. These things weren't cheap, and the ad actually suggested renting the lights. Anything to outdo the neighbors, right? A quarter-century later, Christmas light sales became lucrative enough to create a Christmas-light manufacturing consortium, which monopolized this niche industry for decades.
Today, Christmas lights -- and the electricity needed to operate them -- cost Americans $45 billion per holiday season. Many people and businesses use these festive decorations year-round, or at least for periods well past December. Privately held distributor Christmas Lights, Etc. counts a number of entertainment venues as top customers, particularly theme-park operators. Six Flags (NYSE:SIX), Sea World (one of Blackstone Group's (NYSE:BX) holdings), and Disney (NYSE:DIS) all make extensive use of these lights to make their visitors' experience a little bit brighter.
What happened to that whole "limited government" thing?
Thomas Jefferson wasn't quite as adamant about limited government as you might think. One of his biggest legislative mistakes as president, the Embargo Act, was signed into law on Dec. 22, 1807. The act responded to French and British violations of American neutrality -- committed in the course of the Napoleonic Wars -- by declaring a form of commercial warfare on the two nations, but it went a few steps too far by essentially shutting down foreign trade. It was deeply unpopular with Jefferson's party, which had fiercely opposed original Treasury Secretary Alexander Hamilton's attempts to consolidate government power. It also backfired miserably.
The Embargo Act lasted for a year and a half, and it quickly plunged the young nation into a recession. Shipping was decimated and farmers couldn't sell their wares, but a number of scofflaws on both sides found ways to evade the embargo anyway. The porous Canadian border offered Northern cities ample opportunities to get British goods, or to export theirs. Few other regions could say the same, so New England's more aggressive merchants were the only ones who really managed to benefit.
The act was repealed in early 1809, just before Jefferson left office. America's trade battles with Britain only achieved a brief success in 1812, which came mere days before war was declared. During that war, the United States again tried the same stupid tactic, with the same predictable results.
Reunited and it feels so good
One of German reunification's most powerful symbols opened to East and West on Dec. 22, 1989. That was the date that Berlin's iconic Brandenburg Gate opened for border crossings, allowing thousands of Germans through to find lost loved ones, reunite with old friends, or make new friends. East German Prime Minister Hans Modrow spoke at the opening, insisting that "the burning stench of war must never again be smelled here ... this must be a gate of peace."
This symbolic start of a real move toward unity also signaled a turbocharging of America's economy, particularly its stock market, which has few equals in history. In the decade following the Brandenburg Gate's reopening, the Dow Jones Industrial Average (DJINDICES:^DJI) soared 316%. The Dow's race from 1999 to its early 2000 peak left the roaring '20s in the dust -- from 1919 to a peak in 1929, the Dow gained only 251%.
This huge boom only gained steam when, exactly two years later on Dec. 22, 1991, the former Soviet Union member states officially publicized the details of their new -- but far looser -- political union.
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