Wall Street History

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Wall Street History

12/03/1999

Dow Jones Bergstresser Industrial Average

Back on June 4th, I had a piece on the formation of the Dow
Jones Industrial Average and the founder of the average, Charles
Dow. Both Dow and Edward D. Jones had established Dow
Jones & Co. in 1882. The two decided to later convert an
afternoon newsletter, titled "Customer''s Afternoon Letter," into a
full-fledged newspaper, The Wall Street Journal, which
commenced publication on July 8, 1889.

Well, in the history of Dow Jones & Co., one individual gets the
shaft, Charles Bergstresser. It was Bergstresser who bankrolled
the cash-starved Dow and Jones, beginning in 1882. The
Bergster, however, was not interested in working for Dow and
Jones. He wanted to be the silent partner. The trio did think
about a few names; Dow, Jones, and Bergstresser. Berger, Dow
and Jones. But they were too long and they settled on Dow
Jones & Company. He thus missed out on having his name
somewhere when the Dow Jones Average was introduced in
1896.

Bergstresser was born in 1859, a Pennsylvania Dutchman. He
worked while attending Lafayette College and saved much of
what he earned. [Which means he wasn''t drinking much beer].
After graduation in 1881, he moved to New York City and took a
job covering the stock market as a reporter for the Kiernan News
Agency.

In a 1996 article for the Journal, Vanessa O''Connell writes of
Bergstresser and these times.

"Stocky with thick-lens glasses, Mr. Bergstresser easily won the
confidence of Wall Street executives who were his news sources,
and he wowed his colleagues early on in his career by landing an
interview with the great financier John Pierpont Morgan Sr. A
pugnacious reporter, Mr. Bergstresser had a knack for getting
bigwigs to spill details of their deals. ''He could make a wooden
Indian talk - and tell the truth,'' Edward Jones used to say."

At the time, both Dow and Jones were working for Kiernan as
well. The two of them were looking to start their own news
agency when "Buggy" (his real nickname, not the Bergster)
heard of their plans. He wanted in. It was within 3 months (July,
''82) that the Customer''s Afternoon Letter was first published
from a basement next to the New York Stock Exchange.

Bergstresser''s savings were the seed money. Professor Richard
J. Stillman, author of a book on the DJIA, said that Buggy was
"the driving financial force behind the company during its
formative years." When Dow Jones & Co. turned its newsletter
into a full-fledged paper in 1889, it was Bergstresser who dubbed
it The Wall Street Journal. Incidentally, the Journal sold for two
cents back then and had four pages of text.

And what of Edward Jones? While Charles Dow was known to
be a rather calm, albeit tough journalist, Jones was a hot-
tempered sort and the more visible of the two. He wrote and
edited the bulletins while spending his nights looking for tips at
the watering holes frequented by his racy friends, the
wheelerdealers of Wall Street. Stillman writes of Jones that he
was "excitable, emotional and you never knew when he might
explode" in profanity.

It was Dow who eventually grew uncomfortable with Mr. Jones
circle of friends and both Dow and Bergstresser disapproved of
his profane outbursts in the newsroom. Jones gradually felt
estranged from his two partners. In 1899 he left the Journal for
the glitter of Wall Street. But, no, sports fans, this Edward Jones
has nothing to do with the present-day brokerage firm of Edward
D. Jones & Co. That was an entirely different man.

And now you know..the rest of the story.

Sources:

The Wall Street Journal.
Dow Jones & Company..various articles. I''d list the authors if
I could find them. Vanessa O''Connell is the only one I found.

Brian Trumbore

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