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The Leadville connection to the Dow in Dow-Jones

Brief by Central Staff

History – July 2007 – Colorado Central Magazine

The Dow-Jones Company, which produces the Wall Street Journal and other business publications, has been in the news lately because Rupert Murdoch (Fox News, New York Post and many other newspapers) is attempting to buy it from the Bancroft family, which has controlled the company for many years.

There’s a Leadville connection of sorts. The Dow of Dow-Jones is Charles Henry Dow, born Nov. 5, 1851, in Connecticut. He went into journalism, working for New England newspapers. His work impressed Charles Danielson, editor of the Providence (R.I.) Journal, and so in 1879 he assigned Dow to join a group of bankers and reporters who were going west to examine the silver mines of Leadville.

After a four-day train trip, Dow wrote nine “Leadville Letters.” He described the mountains and the mining companies, as well as Leadville’s notorious gambling joints, saloons, and dance halls. Here’s a sample of his business reporting:

“All through 1878 people were crowding into Leadville. They needed food, clothing and shelter. Everyone who had either to sell could get his own price. There has always been great difficulty in getting places in which to do business. Today there is not a store or a house to rent in Leadville. In some stores half a dozen kinds of businesses are carried on, and the man who can hire a front window anywhere is content. One man who is doing business in a tent pays $100 a month ground rent; the proprietor of a variety theatre pays $1500 a month for the rude building which his patrons occupy.”

As for finance, he described the disappearance of the individual mine-owners and the role of financiers who underwrote shares in large mining consortiums. Dow warned, “Mining securities are not the thing for widows and orphans or country clergymen, or unworldly people of any kind to own. But for a businessman, who must take risks in order to make money; who will buy nothing without careful, thorough investigation; and who will not risk more than he is able to lose, there is no other investment in the market today as tempting as mining stock.”

After his return, Dow moved to New York City in 1880, and went into partnership with another journalist, Edward Davis Jones. They founded Dow, Jones & Co., a financial news service noted for its integrity — in other words, they wouldn’t take bribes from speculators who wanted them to issue newsletter stories that would affect the stock market.

Their company grew, and in 1889 they founded the Wall Street Journal. Dow devised the famous Dow-Jones Average in 1896. He had health problems, and sold his share of the company to Clarence Barron in April, 1902. He died on Dec. 4, 1902, only 52 years old — but he certainly had made a name for himself.