On this day in economic and business history...

The Crash of 1929 began in early September. It made its presence felt beyond doubt on two wrenching days at the end of October. The Dow Jones Industrial Average (DJINDICES:^DJI) gave investors a heart-stopping ride that fall, collapsing from September's all-time high of nearly 400 points to less than 200 by mid-November, before appearing to stabilize at the end of the year at a level 35% below September's "permanently high plateau." It might have been tempting to believe that the worst was over, but the worst crash in history was only just getting started.

The following year saw the Dow lose another 34% of its value, as it closed out 1930 nearly 60% below 1929's peak. There was no relief in 1931. The Dow suffered its all-time worst calendar-year performance that year, slipping 53% lower to close at just 78 points -- a shocking 80% decline. But that wasn't the end of it. The Dow fell through the spring and into the summer of 1932 before plummeting to its final low of 41.22 points on July 8, 1932. Not only had the decline been extraordinarily steep, but its path had been extraordinarily volatile. The average price change for more than 700 trading days had been nearly 2% per day, and from beginning to end the market's valuation had plummeted from near all-time highs to near all-time lows.

The news of the day centered on an accord regarding German war reparations reached at Lausanne, Switzerland. Most commentary expressed a sense of general disbelief that the market might remain indifferent to "a new departure toward European good will and restoration of prosperity," in the words of The Washington Post. Wall Street's "singularly apathetic response" to the agreement that aimed to modify German repayments stood in contrast to the bond market's "evident satisfaction" with the deal, according to The New York Times. Despite the weakness in stocks, many financial professionals appeared confident that slashing Germany's required reparations to American interests from more than $2 billion to just $715 million would allow greater funding to flow into Germany, allowing the Depression-wracked country a chance to recover without funneling all its money into debt repayments.

The following Monday (July 8 was a Friday) saw a rebound in the market built largely on the strong performance of a few speculative industrial stocks. It was the 1932 equivalent of a garbage rally, as the rebound owed largely to bears covering their shorts. True to form, the Dow's rebound was impressive but somewhat ephemeral: By early September, the index had surged to nearly 80 points, and it would have finished the year in positive territory if not for an autumn collapse that mimicked 1929's. The Dow finished the year 23% lower than it had begun, a weakness partly the result of uncertainty swirling around 1932's momentous presidential political campaign. When that uncertainty cleared, the Dow finally shrugged off its doldrums to post the single best year of growth in its history. From the start of 1933 to its last trading day, the Dow gained 67%. It was still a long way off its 1929 highs, but there was finally some reason for optimism -- and the Dow would never again fall as low as it had on July 8, 1932.

The chronicle of commerce begins
The Crash of 1929 was well-covered with expert analysis thanks in no small part to The Wall Street Journal, which was first published on July 8, 1889. Predated by Charles Dow's "Customer's Afternoon Letter," which offered brief commentary and early stock-index prototypes, the WSJ emerged several years after Dow's first publications in a four-page format that cost only $0.02 and was not much different from Dow's original two-page "Letter." The WSJ was simply an evolutionary step up in quality, and for many years it was simply the only source serious investors had for the financial details we now take for granted. The Fool's own "History of the Dow" explains why:

The Customer's Afternoon Letter was nothing short of revolutionary. In Dow's time, consolidated stock tables published every day did not exist. Information about a company's balance sheet was rarely published, with management attempting to hide and obscure the full value of their company for fear of a takeover. The Letter not only reported consolidated stock tables, but also made public quarterly and annual information regarding company financials -- something that only insiders had available to them before this. Dow's publication leveled the playing field between the Wall Street elite and the individual investor. It would not be until the Securities Act of 1934 that companies would be required to file quarterly and annual reports that all investors could look at. So, for more than fifty years, the only place for the individual investor to get the straight poop on company financials was The Wall Street Journal.

The WSJ and other Dow Jones properties became part of News Corp. (NASDAQ:NWS) in 2007. Today, it is the largest newspaper in daily circulation in the United States, with 2.4 million subscribers, of whom about 900,000 are only subscribed to the digital edition. That's about half a million more subscribers than the second-largest newspaper in the country.

Cola without the calories
At a press conference in New York City on July 8, 1982, Coca-Cola (NYSE:KO) executives revealed "the most significant new product ... in the entire 96-year history of the Coca-Cola Company." That product was Diet Coke, the result of a two-year top-secret development program aimed at recovering the ground Coke was losing to other low-calorie sodas.

Coke found itself in a bit of a bind in the early '80s. The company had no low-calorie version of its flagship product but was already enjoying great success with Tab, a diet cola that was threatening Coca-Cola despite being produced under the same corporate umbrella. Producing an actual diet version of Coca-Cola ran the risk of cannibalizing Tab and damaging the Coke brand's prestige, should the product fail to catch on after its initial hype. On the other hand, a sugar-free soda offered Coke better margins, which was too good a promise to pass up. By the time Coke had its product in hand, the soda-drinking population was primed to drink Diet Coke "Just for the Taste of It," as the popular introductory tagline went.

Within a year, Diet Coke had leapt to the top of the diet soft-drink category. By the end of 1984, Diet Coke had become the third-best-selling soft drink in the U.S., behind only the two primary full-calorie colas. In 2010, Diet Coke overtook Coke's major competitor to become the second-best-selling soft drink in America, behind only Coca-Cola itself. Coke's executives rather quickly forgot about Tab, which is now little more than a footnote in the history of the cola wars.

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