President Franklin D. Roosevelt withdrew the United States from the gold standard on April 19, 1933. It was only the latest in a series of drastic steps taken during Roosevelt's legendary first 100 days in office to stem the tide of the Great Depression, following a nationwide banking holiday and the criminalization of most private gold-ownership. As a result of Roosevelt's action, the Dow Jones Industrial Average (DJINDICES: ^DJI ) shot 9% higher -- the second-best percentage gain of 1933 following the post-banking-holiday market reopening.
The New York Times wrote a concise summary of the event and its motive forces:
Officially cut adrift from the gold-standard anchor by President Roosevelt's announcement prohibiting exports of gold to support exchange, the dollar fell yesterday to a discount of 11.5% in terms of the gold-standard currencies of the world.
Embracing the belief that inflation was at hand, the stock and commodity markets soared, while United States Government bonds and other high grade fixed-interest securities broke sharply. The imposition of an air-tight embargo upon gold exports, coupled with intimations from Washington of plans for expanding credit, and, if necessary, enlarging the basis of the currency, unleashed in Wall Street a stampede for "equities."
Part of the optimism was driven by legendary banker J. P. Morgan Jr., the 66-year-old heir of legendary banker John Pierpoint Morgan and the chairman of the JPMorgan (NYSE: JPM ) bank that bore his family name. Morgan said he welcomed the action, and, furthermore:
It has become evident that the effort to maintain the exchange value of the dollar at a premium as against depreciated foreign currencies was having a deflationary effect upon already severely deflated American prices and wages and employment.
It seems to me clear that the way out of the depression is to combat and overcome the deflationary forces. Therefore, I regard the action now taken as being the best possible course under existing circumstances.
Although some confusion remained over the particulars of Roosevelt's gold plans -- that is, whether it was a true inflationary program or merely an effort to gain negotiating leverage against Britain and France -- the market didn't wait for clarification. Commodities and commodity stocks were broadly higher, with steel, copper, rubber, tobacco, and sugar issues all posting large gains. More than 5 million shares traded during the day, and utilities and railroads joined the parade as well, though to a more modest degree than that enjoyed by commodities investors. These industries had their own reasons for optimism, as railroad freight volume, steel output, and electricity production all showed growth in reports issued before the start of trading on April 19, 1933. The recovery from the Great Depression seemed to be underway at last.
Building a better corporate future
Home Depot (NYSE: HD ) graduated from over-the-counter trading to a spot on the New York Stock Exchange on April 19, 1984. The 6-year-old company had already grown into a market cap of nearly half a billion dollars, its stock already up more than 1,000% from a 1981 IPO. Home Depot operated 19 stores with about $250 million in annual sales in 1984. Graduating to the Big Board gave the company some big publicity, and a year later Home Depot became a 50-store growth rocket with $1 billion in annual sales.
Home Depot's first decade on the New York Stock Exchange wasn't without its growing pains. Its stock suffered a sharper loss than many others during 1987's Black Monday, losing more than half its value during the short but vicious crash. Home Depot also fell precipitously in the fall of 1990 as a result of the savings and loan crisis and its resulting depression of the U.S. housing market. Neither of these slowed Home Depot, which posted another 2,000% gain between 1984 and 1994. By the time Home Depot joined the Dow in 1999, it had posted dot-com-like returns, giving investors who bought in on the day of its ascent to the Big Board a 12,550% gain to the day of its Dow initiation. The small home-improvement upstart had grown into a retail juggernaut by then, with 909 stores in the U.S. and Canada (plus four in Chile) generating more than $38 billion in sales.
Shot heard round the world
By the rude bridge that arched the flood,
Their flag to April's breeze unfurled,
Here once the embattled farmers stood,
And fired the shot heard round the world.
--Ralph Waldo Emerson, "Concord Hymn"
The American Revolution began on April 19, 1775, when British Army redcoats marched on Concord and were turned back by a spirited band of colonial militiamen. The war would rage for six years until Cornwallis' surrender at Yorktown in 1781 (and the Treaty of Paris two years later) gave the rebels the freedom needed to build a nation of their own.
Although the Lexington and Concord conflict has been spun indelibly into the patriotic fabric of the U.S. as the start of the Revolution, it was in truth a minor conflict with relatively few casualties -- but it spurred thousands of colonial men to take up arms against what they perceived as a foreign oppressor. It also made a hero of Paul Revere, whose famous ride preceding the battle became another icon of American patriotism. The U.S. now cautiously approaches the 250th anniversary of this transformative event, its status as the world's largest economy no longer assured or taken for granted. The colonial Americans of 1775 could scarcely have imagined that their actions would lead to the creation of the most powerful nation in world history as they faced the most powerful nation of the late 1700s. What will the future hold for the more distant heirs of that revolution?
I can speak computer. Can you?
IBM (NYSE: IBM ) released the first FORTRAN compiler to the public on April 19, 1957. The first trial run, at Westinghouse, produced an error message due to a missing comma, and from there on the language would spread rapidly throughout the field of high-performance computing, much of which used IBM mainframes and was thus already well-equipped to use it.
What is FORTRAN? Named after IBM's "Mathematical Formula Translating System," FORTRAN was the first modern high-level programming language, and as such it was designed to replace assembly language -- the closest thing you can get to hand-coding everything as ones and zeroes. FORTRAN made the task of programming far simpler by reducing the number of operational statements by roughly a factor of 20. It was quickly adopted for computationally intensive programming, which happened to be most programming at a time when most machines were huge contraptions that might cost millions of dollars. In fact, it's still so useful for scientific applications that modern supercomputers still use FORTRAN benchmark programs to test their speed and run some of their more complex models.
FORTRAN is one of the few computing dinosaurs still lumbering across the tech landscape today, and although most of the languages that came afterward developed their own ways of doing things, they all owe FORTRAN and inventor John Backus for getting the ball rolling on programming languages.
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