The Dow Jones Industrial Average:

The Market’s Measure

In 1896, Charles H. Dow developed what is today The DJIA and its sister index, The Dow Jones Though it has changed greatly over the years—including
known as the Dow Jones Industrial Average (DJIA). Transportation Average, gave new credibility to the expanding to 30 companies and using much more
It was composed of 12 companies that were traded stock market. Dow’s inventions made investing more complex methods to calculate and deliver its values in
on the New York Stock Exchange. By watching this understandable and accessible to individuals who real time—“The Dow” remains the world’s single most-
“average” of the prices of a dozen large and diverse previously were unsure or untrusting of it. quoted and most-watched index. It has truly become
stocks, investors were able to gauge how the entire “the market’s measure” for investors around the globe.
market was doing.

14000

Ronald Reagan George Bush Bill Clinton George W. Bush Barack Obama
16000 16000
Hurricane Katrina slams Gulf Coast Iran election sparks massive protests
Eurozone, IMF agree to €110 billion bailout package for Greece
Terrorists bomb London Cash for clunkers program started
14000 14000
Democrats win control of both House and Senate GM re-enters market
with biggest IPO ever.

President Barack
12000 New Fed chairman Obama inauguration 12000
13000
Bear Stearns
collapses
10000 10000
iPhone unveiled
New Century Financial files for backruptcy
Federal takeover of Fannie Mae and Freddie Mac
8000 8000
Emergency rule imposed in Pakistan Deepwater
9/11 Commission Report Published Horizon leak
Barack Obama elected President is capped
6000 6000
George W. Bush re-elected Swine flu declared global pandemic
President Bush announces plans for Iraq troop surge “Flash Crash” occurs 12000
Lehman Brothers files for bankruptcy protection
4000 4000
Bush signs plan creating $700 billion TARP
AIG, Pfizer and Verizon join The Dow
Fed lends $85 billion to AIG
Pope Benedict XVI elected
2000 2000 11577.50
Saddam Hussein sentenced to death by hanging Dubai asks to defer debts Close of DJIA
Tsunami kills 310,000 in Asia U.S. healthcare reform becomes law 12/31/10
War in Iraq
0 0
1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
11000

Dwight Eisenhower John Kennedy Lyndon Johnson Richard Nixon Gerald Ford Jimmy Carter
1200 1200

1000 1000

10000

800 800

600 600

400 400
9000

200 200

0 0
1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 1962 1963 1964 1965 1966 1967 1968 1969 1970 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980
8000

Calvin Coolidge Herbert Hoover Franklin Roosevelt Harry Truman

450 450

400 400

350 350
7000

300 300

250 250

200 200

150 150 6000

100 100

50 50

0 0
1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 1951
5000

Cleveland William McKinley Theodore Roosevelt William Taft Woodrow Wilson Warren Harding
140 140

120 120

4000

100 100

80 80

60 60

3000

40 40

20 20

0 0
1896 1897 1898 1899 1900 1901 1902 1903 1904 1905 1906 1907 1908 1909 1910 1911 1912 1913 1914 1915 1916 1917 1918 1919 1920 1921 1922 1923 2000

Recession Democrat Republican

1000

1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010