On this day in economic and business history...
Three great columns of flame rose in the sky over Mount Tambora on April 10, 1815. The long-dormant Indonesian volcano had rumbled to life five days earlier with a thunderous detonation followed by ashfall, a warning to the world. On April 10, the mountain became liquid fire. A monstrous ejection of ash climbed nearly 27 miles into the stratosphere as the volcano's explosive shockwave ripped across the globe. Darkness fell for hundreds of miles as ash spread across the sky, blocking sunlight and suffocating crops. When it was over, more than 36 cubic miles of material had blown into the atmosphere, the 14,000-foot peak had been cut more than 4,000 feet shorter -- and the world was about to experience its last great subsistence crisis before entering a period of explosive population growth.
The Mount Tambora eruption was the largest in recorded history, with roughly four times the energy and 100 times the volume of ejected material as the more famous Krakatoa eruption later in the 19th century. At least 70,000 people died as a direct result of the explosion and its subsequent ashfall. More notably, Tambora was a significant contributing factor to what became known as "The Year Without a Summer" in 1816. That year, global average temperatures dropped by roughly one degree Fahrenheit, with regional drops of five degrees or more recorded in much of the Northern Hemisphere. Snow and ice blanketed temperate areas well into the summer, and wide swaths of cropland failed across Europe and North America, causing shortages and highly inflated prices of most staple crops and thus the worst famine of the 19th century. Hundreds of thousands of Europeans died of starvation and disease brought on by the changed climate.
The Year Without a Summer also had an impact on political and economic transitions already underway throughout the Western world. Beyond mass famine and starvation, which helped give rise to the modern administrative style of government, the cold summer purportedly sped up the settling of the American heartland as farmers and workers fled the cold and failed crops. The event also contributed to the development of the earliest bicycles, which would later inspire the development of motor vehicles. The cold, dreary weather may even have inspired Mary Shelley's Frankenstein, the world's first example of science fiction.
Mount Tambora rumbled to life again in 2011, prompting Indonesian government warnings and a minor panic in the global media. It hasn't repeated its 1815 eruption -- you'd have heard about it and seen the change in the sky -- but the devastated caldera remains under heightened scrutiny, and the world waits.
Sailing toward tragedy
The Titanic set sail from Southampton, England, on her doomed maiden voyage to New York City on April 10, 1912. The massive liner narrowly averted disaster as it left port. The omen was doubly foreboding considering the name of the other ship put at risk by the Titanic's girth: City of New York nearly collided with Titanic after the latter created a suction effect in the port. The New York Times reports:
As the Titanic passed from her berth out to the open stream of Southampton water she sucked the water between herself and the quay to such a degree that the strain broke the strong hawsers [mooring cables] with which the American liner New York was moored to the quayside, and for some time a collision between the two vessels looked likely.
The New York began drifting helplessly, stern first, toward the Titanic.
It was only thanks to the quick thinking of the harbormaster and the captains of two tugboats that the New York was brought under control. Collision was avoided when Titanic captain Edward Smith reversed his port propeller to turn the larger vessel away. Unfortunately, Smith would not be so quick-thinking when faced with an iceberg on the open sea. You can read more about the history of the Titanic (and get a bit of background on the most recent financial crisis) at this link.
Fight for your (copy)right
The world's first true copyright law took effect in Great Britain on April 10, 1710. Implemented three centuries after the first government-issued British patents, the Statute of Anne (named after the Queen) marked the first time any government in the world attempted to regulate copyrights directly; prior to the statute's enactment, copyrights were managed and maintained by a private printer's guild.
The statute granted a 14-year copyright term to all authors and their chosen printers, during which time no one else would be able to publish that author's work. Authors could apply for a renewal of copyright after 14 years had passed. Following this second term, the works would enter the public domain. Thus ownership of creative works was, for the first time in history, vested in the creators, rather than the publishers.
The Statute of Anne was so groundbreaking in the field of copyright law that a young American government, fresh off its incredible victory over Great Britain, all but duplicated the statute's wording when it came time to implement its own copyright law in 1790. Professor Oren Bracha of the University of Texas School of Law notes:
The sheer degree of identity, at least on the formal level, between the British Statute of 1710 and the American copyright regime ... is striking. While the influence of the Statute of Anne on early American copyright legislation is widely known, scholars often overlook the scale of duplication on the level of ideological purposes, concepts, technical legal arrangements, and specific text. When these identical features are examined closely, the genesis of the American copyright system appears to be a major operation of international plagiarism.
The statute, unfortunately, was far from perfect. Although it attempted to cover authors' rights, the statute did not provide adequate means of identifying authors and would only cover printed books despite the range of other printed material already available. In an era when many tracts were published under pseudonyms and the cost of printing remained quite high, this was not a terrible shortcoming. But in time, these weaknesses would become too much to ignore. It was not until 1842 that Great Britain created legislation to supersede the groundbreaking Statute of Anne, and it was not until a new Copyright Act was passed in 1870 that the United States moved beyond the confines of its British copyright heritage.
The Roosevelt rebound accelerates
On April 10, 1933, the Dow Jones Industrial Average (DJINDICES:^DJI) enjoyed its second-largest year-to-date gain, spiking 5.7%. This performance trailed only a March 15 surge that has since gone down in the record books as the largest one-day gain in Dow history, and it demonstrated Wall Street's support for President Franklin D. Roosevelt's week-old decision to prohibit most private ownership of gold. The day's rise was, according to The New York Times, primarily a result of the announcement that the Harriman National Bank would be able to pay depositors in full, further bolstering the approval of FDR's bank deposit insurance plan, which had been directly responsible for the March 15 gain. Many banks rose on the good news.
Reports that United States Steel (NYSE:X) had barely worked through its 1.8 million ton order backlog also encouraged investors, as it offered tangible evidence that demand was returning to equilibrium with supply. The backlog decrease of only 13,000 tons was the lowest since a 12,000-ton backlog growth the prior October; in the previous five months, U.S. Steel's backlog had dwindled by only 156,000 tons, compared with a steep 647,000-ton collapse in unfilled orders in the prior-year period. The relatively minimal backlog-reduction was especially encouraging in light of the banking holiday that had shut down much of the country's business for more than a week in March. Optimism was on the rise, and so was the Dow -- its rebound from 1932's lows was now racing ahead to one of the largest bull-market gains in index history.