San Francisco Financial Planner, San Francisco Financial Advisor

“The market was down 50 points today.”  When you hear this, people are generally not talking about the broad market, but instead about the Dow Jones Industrial Average (DJIA).  Since its creation over 111 years ago, the Dow Jones industrial average has become a widely followed barometer of the stock market, despite its obvious shortcomings such as tracking only 30 stocks. 

The industrial average has contained 30 stocks since 1928, when it was expandeded to represent the major industries of the U.S. stock market.  But when the Dow Jones industrial average began on May 26, 1896, it contained just 12 stocks.  Due to radical changes in the economy since 1896, just one of the original companies, General Electric, remains in the Dow Jones industrial average today.  But surprisingly, all but one of the companies still exists, either as a stand-alone company or as a unit of another company.

American Cotton Oil - This company was founded in 1889 to trade in cotton seeds and cottonseed oil. After a series of restructurings that changed the company's name from Gold Dust to The Best Foods, CPC International and Bestfoods, the company was bought in 2000 by Dutch conglomerate Unilever.

American Sugar - Henry Havemayer created this company in Brooklyn.  It is now the only privately held former member of the Dow.  It changed hands several times, but was most recently bought by Refined Sugars. The company operates in Yonkers, N.Y.

American Tobacco - This former tobacco giant was created when Washington Duke assembled the big four tobacco companies. The company's fantastic profits attracted the attention of government trust busters, who caused the company to split into four companies, including today's R. J. Reynolds. The former American Tobacco got into businesses other than tobacco, and is now Fortune Brands, whose products include Jim Beam bourbon and Titleist golf balls…but no tobacco.

Chicago Gas - Chicago Gas Light & Coke Company was one of the leading providers of natural gas in Chicago.  It was bought by Peoples Gas Light & Coke Company in 1897. Peoples Gas was renamed People's Energy in 1980, and still serves customers in Chicago.

Distilling and Cattle Feeding - This company found a way to profit from the seemingly unrelated businesses of brewing and livestock.  The company sold grain left over from the brewing process for cattle feed. Prohibition had a major impact on the company, which renamed itself American Spirits Manufacturing and then National Distillers. The company shifted from liquor to industrial chemicals as National Distillers Products Corp.  New management decided to stick with industrial chemicals even after Prohibition.  National Distillers then merged with U.S. Industrial Chemicals.  When the liquor business was sold to American Brands, the company became Quantum Chemicals.  Quantum was bought by Hanson PLC in 1993, and then spun off as Millennium Chemicals.

General Electric - The company that trades by the ticker symbol “GE” and makes everything from airplane turbines to television programming.  It is the only original Dow stock that is still listed on the index.

Laclede Gas - Founded in 1857, the company provided "illuminating gas" to customers around St. Louis.  While the name changed a bit, to Laclede Group, it is still publicly traded and serves the same geographic area.

National Lead - This company, founded in 1891, was a leader in providing lead, which had many common uses in the early 1900s.  Today, the company has morphed into a conglomerate called NL Industries that has profited, among other ways, by creating chemicals that replaced lead because they are considered safer.

North American - Henry Villard and Samuel Insull launched this company to invest in a collection of enterprises from railroads to utilities in the Midwest.  A federal court broke the company apart in 1938, creating two successor firms; Milwaukee Electric Railway & Transportation, which was acquired by the now defunct Milwaukee Suburban Transportation, and Wisconsin Electric Power, which is We Energies today.

Tennessee Coal & Iron - This steel company, founded in 1852 as Sewanee Mining competed with behemoth U.S. Steel for decades. Tennessee Coal & Iron bank support wavered in 1907 (after the financial Panic of 1907), allowing U.S. Steel to buy the company.

U.S. Leather - This collection of tanneries was created in 1893 and grew rapidly as demand for leather products soared.  But U.S. Leather became the only Dow company to fail by a combination of environmental rules and foreign competition.

U.S. Rubber - Before the creation of rubber companies like this one in 1892, the use of rubber was limited because natural rubber was imported and costly. The ability to manufacture rubber opened new possibilities. Eventually U.S. Rubber merged into Germany's Continental to create Uniroyal. That company folded into B. F. Goodrich in 1986 and that was bought by Michelin in 1990.