On this day in economic and financial history...
For 25 years, the Dow Jones Industrial Average (^DJI +0.66%) looked up at 381 points, an all-time high set at the start of September 1929. For 25 years -- through six presidential elections, a worldwide abandonment of the gold standard, the rise of fascism, a world war, the rise of Communism, and five cyclical bear markets sandwiched into the most devastating secular bear market in history -- traders looked back with nostalgia at 1929. They wished they had seen the crash coming. They wondered when they'd finally get past it. They saw the rest of the world moving on, no longer obsessed with tickers and trades.
On Nov. 23, 1954, after 25 grueling years, the Dow finally broke new ground. Closing the day at 382 points, the Dow tacked on just enough growth to push the all-time ceiling a little higher. The New York Stock Exchange set its own record for the breadth of its trading, as 1,271 different stocks exchanged hands.
The New York Times reported on the importance of stock selection for index progress. "Standard & Poor's (^GSPC +0.54%) index [at the time a value-weighted index of 90 stocks] went over the top last spring but the New York Times combined average is still 61.46 points below it."
The Times continued:
There are only 17 companies in the Dow Jones Index today of the 30 that comprised it in 1929. There have been 25 substitutions. Harold Clayton of Hemphill, Noyes & Co. ... recently pointed out that if the 1929 compilers of the Dow Jones average had used the same stocks that are used today, their industrial index would now be 40% over the top.
The reason for the rise was as simple as could be, according to the Chicago Daily Tribune: "Brokers, whose offices are crowded these days, attributed much of the buying to the apparent conviction of traders and the public that stocks are going higher and higher."
The Dow did indeed continue to go higher and higher. It peaked at 521 points in April 1956, but through all the subsequent bear markets that followed, it would never again drop beneath the 1929 peak of 381. The Great Depression had been put in the rearview mirror for good.
You wish your phone were this smart
Did "smartphones" begin when Apple (AAPL +0.33%) unveiled the iPhone? Not quite -- but it does depend on how you define a smartphone. A mobile phone with the elements of a computer first awed the gadget-hungry public at COMDEX on Nov. 23, 1992. It allowed users to make phone calls, but it also allowed them to send and receive faxes, emails, and pages. It even had "apps," including an address book, a calendar, a calculator, a notepad, and a world time clock.
This mythical device was the IBM (IBM +0.33%) Simon, revealed in 1992 under the code name "Angler" and eventually marketed for sale during a seven-month period between 1994 and 1995. It even made an appearance in the Sandra Bullock cyber-thriller The Net, but by the time the movie hit theaters the Simon had been withdrawn from the market.
The Simon cost $899 (there were no subsidies in those days) with a two-year contract to BellSouth Cellular, now a part of AT&T (T 0.21%), and sold about 50,000 units. Only one third-party application was ever developed: a business field-service optimization tool called DispatchIt, which retailed for the mind-boggling price of $2,999 just for host-computer software. Each Simon client cost users an additional $299 -- yes, each. Apps were commonly loaded via memory cards that resembled GameBoy cartridges. The phone, as you might expect of a portable device in 1992, was a highly functional brick that would dwarf any modern smartphone.
Unfortunately, neither IBM nor the world was ready for a device as advanced as the Simon, especially so soon after Apple's highly touted Newton (one of the earliest tablets) flamed out. IBM was in one of the lowest points of its modern life, hemorrhaging money and losing market share to a number of upstart PC makers. Feature flip phones, smaller and simpler and far more portable, had caught the public's eye. The infant Internet and the early cell networks simply couldn't offer the bandwidth to make a fully functional connected phone useful.
The first so-called "smartphone" wasn't unveiled until 1997, when Ericsson (ERIC +1.40%) began calling a GS 88 concept phone by that term. However, by then Nokia (NOK +1.94%) had already been selling its 9000 Communicator, the first in a successful series of business-oriented clamshell-style smartphones, for a year. Like the Simon, it too made a splash in the movies. Val Kilmer used a Nokia 9000 Communicator in the 1997 remake of The Saint. How many movies and TV shows of the 1990s would have had wildly different outcomes if their characters were equipped with smartphone technology? It boggles the mind.
