More Econ homework
1. What is the Dow Jones? Its history? Who belongs to it?
The Dow Jones is an index of many corporations that is an indicator of how well the economy is doing. It publishes international business and finance newspapers such as the Wall Street Journal and Barron’s Magazine.
It was founded in 1882 by Charles Dow, Edward Jones, and Charles Bergstresser. Originally, these three hand-wrote “flimsies”, their own newsletters delivered to Wall Street subscribers. In 1889, they changed these small letters into a full newspaper-the first publication had four pages. Clarence W. Barron bought the company when Dow died in 1902. Barron’s Magazine was first printed in 1921, with Barron as editor. In 1941, well after Barron’s death, Bernard Kilgore took over. By the 1980’s circulation was beyond 2 million, and by the 90’s they were publishing very successful newspapers and magazines all around the world. Most recently, the Dow Jones entered an alliance with NBC, producing a television program called CNBC, which delivers top quality business news for Americans, Asians, and Europeans.
Members:
• 3M
• Alcoa
• Altria Group
• American International Group
• American Express
• Boeing
• Caterpillar Inc.
• Citigroup
• Coca-Cola
• DuPont
• Exxon Mobil
• General Electric
• General Motors
• Hewlett-Packard
• Home Depot
• Honeywell International
• Intel
• International Business Machines
• J.P. Morgan Chase & Co.
• Johnson & Johnson Corporation
• McDonald's Corporation
• Merck and Company
• Microsoft Corporation
• Pfizer
• Procter and Gamble
• SBC Communications
• United Technologies
• Verizon
• Wal-Mart
• Walt Disney Company
2. What is a conglomerate? Find an example of one and give a brief profile.
A conglomerate is a large company consisting of many divisions of seemingly unrelated business.
ITT (International Telephone and Telegraph) is a conglomerate that was very successful in the 1960’s. Harold Geneen ran the conglomerate back then, but it was forced to sell off most of it’s holdings in the 70’s when interest rates began to rise. It started out with telephone monopolies outside of the states. It bought a television company in the 70’s, hoping to profit in this new market. In the 70’s, low interest and accounting and tax laws allowed Geneen to take out large loans and buy over 300 other companies including the Sheraton hotel chain, the Wonderbread makers, and many other small companies dealing in auto parts, books, semiconductors, cosmetics, and a variety of other products. During WWII, ITT’s German subsidiaries had connections and arrangements within the Nazi Party. From 1960 to 1970 it’s profit grew over 500 million dollars, but it quickly began to fad to obscurity. This fall was assisted by public displeasure at ITT’s influence in elections in the States and elsewhere during the 70’s. It was, however, one of the more successful conglomerates. When most were in financial difficulty by the early 70’s, Geneen held on until 77. In the next twenty years, the company sold off almost all of its subsidiaries. Some former subsidiaries are still thriving today, but they are no longer a part of the whole, which has all but collapsed.
3. Find 1 news headline that seemingly affects the entire stock market.