On this day in economic and financial history...
On Oct. 31, 1938, the New York Stock Exchange sought to assuage uncertain investors and preserve the Dow Jones Industrial Average's (DJINDICES:^DJI) huge eight-month gains by teaming up with the Securities and Exchange Committee to promote a sweeping set of trading reforms. The Dow was then near the top of a rebound that had begun in April and which had increased the downtrodden index's value by 53%.
On that day, Wall Street insiders were still buzzing over the highly publicized downfall of former stock exchange president Richard Whitney, who had been convicted of using his position to embezzle significant amounts of money and securities. The reforms, drafted in response to Whitney's actions, would soon be adopted by other stock exchanges throughout the country. You may recognize some of these reforms as integral parts of our modern market:
- Quarterly financial statements became the standard for publicly traded companies, and annual independent audits were required of all public companies filing annual reports.
- Several rules significantly tightened the restrictions on margin accounts and enforced greater disclosure of any unsecured loans.
- Brokerage firms were much more restricted in what they could do with customer funds and securities, separating the resources owned by customers from those of the firms.
- Conflict-of-interest rules prevented exchange officials from participating in investigations of any issue in which they held a financial interest.
- Brokerage firms were required to regularly report on the contents of their trades.
These reforms gave the four-year-old SEC additional powers to enforce transparency on the public markets, but it wasn't enough to save the Dow from another minor bear market which began several days later. When the world came back to its senses after the horrors of World War II, millions would look to invest on American exchanges, drawn by these and other reforms that had created a global gold standard in financial transparency.
One great big gamble
The Nevada Territory was rushed to statehood in the final days of the 1864 election campaign, as Republican leaders wished to enhance their majorities in the legislature. With President Lincoln's proclamation, Nevada was admitted to the Union on Oct. 31, 1864.
The New York Times gave its readers a detailed look at the new state on the date of its admission, noting its size of "about ten thousand square miles ... appropriated from the northern extremity of California, and about seventy thousand from Western Utah." The Times also pointed out that "no region in the world is richer in argentiferous leads" (a fancy way of saying that it had a lot of silver) and praised Nevada's ample salt and quartz deposits.
The gambling haven we know today didn't take shape until after the Great Crash of 1929. Nevada legalized gambling in 1931, and the first casino cropped up shortly afterward as an expansion of the Pair-o-Dice nightclub in Las Vegas. The first casino on the Las Vegas Strip was El Rancho Vegas, which lasted about 20 years before it was destroyed in a fire.
Today, Nevada regularly generates more than $1 billion per month in gambling revenue, with approximately half coming from the Strip. Many of the largest individual Las Vegas casinos, including the Mandalay Bay, the Bellagio, and the MGM Grand, are owned by MGM Resorts (NYSE:MGM). In terms of combined footage, the Venetian and Palazzo complex, owned by Las Vegas Sands (NYSE:LVS), is Las Vegas' largest -- more than 50,000 square feet bigger than the second-place complex, which contains the Wynn (NASDAQ:WYNN) Las Vegas and Encore casinos.
Nevada isn't just about gambling. The state remains one of America's most important sources of silver today, and is second in production only to Alaska. At the latest count of the Nevada Bureau of Mines, Coeur d'Alene Mines (NYSE:CDE) operated the single-largest silver mine in the state: Coeur Rochester, which produced more than two million ounces of silver in 2010. In terms of total production, Newmont Mining (NYSE:NEM) was the state's leader by far, with 2.8 million ounces of silver mined from its Phoenix, Midas, and Twin Creeks mines.
Fool contributor Alex Planes holds no financial position in any company mentioned here. Add him on Google+ or follow him on Twitter @TMFBiggles for more news and insights. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.