Money 2010
A Brief History of Money in Boston
1638: A Charlestown minister named John Harvard dies and—in an act of philanthropic genius — leaves a wad of cash and some books to the new college down the road.
1784: The Massachusetts Bank is founded, setting off an orgy of name changes and consolidation that continues to this day, variously involving the Bank of Boston, BayBank, Fleet, Shawmut Bank, and Bank of America.
1809: Con-man banker Andrew Dexter triggers the first U.S. bank collapse when he finances Boston’s biggest building with dubious loans and worthless bank notes.
1813: Francis Cabot Lowell founds a textile mill on the Charles River and finances its construction by selling shares in the company, giving birth to the American stock system.
1872: A quirk of city tax law encourages merchants to stuff their timber-framed store attics with surplus goods. The Financial District goes up in flames.
1881: Edward Filene opens his eponymous store, going on to invent the bargain outlet as well as create the first-ever U.S. credit union.
1919: Boston bookie Joseph “Sport” Sullivan meets with Chicago White Sox first baseman Chick Gandil at the Hotel Buckminster. Gandil offers to fix the World Series for $80,000.
1920: Boston’s Charles Ponzi is revealed to be a fraud when a newspaper series details how he pays his investors using the money of newer investors. The so-called Ponzi scheme takes in $20 million and leads to the demise of six banks.
1924: The Massachusetts Investors Trust is established as the nation’s first mutual fund. It’s a boon to the professional stock manager and allows investors to own stakes in many different companies. The fund grows that year from $50K to nearly $400K.
1946: Harvard Business School professor Georges Doriot and ex–Boston Federal Reserve president Ralph E. Flanders start the world’s first venture capital firm, ARD, which invests in a slew of technologies being invented at MIT.
1950: Masked gunmen swipe $2.7 million in cash and checks from the Brinks Building. Then the country’s biggest theft, it’s billed as the “crime of the century” — until the crooks are caught six years later.
1966: After serving as a caddy to Fidelity’s president at the Brae Burn Country Club, Peter Lynch lands an internship at the investment firm, where he later becomes history’s greatest stock-picker.
1980s: The Massachusetts Miracle blossoms, turning Route 128 into a multibillion-dollar innovation epicenter, home to early tech giants Wang Laboratories, Digital Equipment Corporation, and Apollo Computer.
2000: Boston investment analyst Harry Markopolos starts deconstructing the work of hedge-fund king Bernie Madoff, concluding he’s a fraud. Regulators ignore Markopolos’s repeated warnings, and Madoff bilks investors out of some $65 billion.
2008: Ofer Nemirovsky begins work combining two Back Bay townhouses to create the city’s biggest home. The two-year, $23 million project will give the private-equity exec 15 bathrooms and 24,000 square feet of living space.
2008: Harvard’s endowment hits nearly $37 billion — before losing a spectacular $11 billion over the next two years.