Lewis and Clark Museum in St. Louis

I remember this Lewis and Clark Museum, but it really was part of the Museum of Westward Expansion in the visitor’s center in the Gateway Arch.  I remember the older theater that opened in May 1972, since the newer theater, called the Odyssey Theatre, was constructed in the 1990s.  I really enjoyed learning about Lewis and Clark.  On May 14, 1804, Captain Meriwether Lewis, and his close friend Second Lieutenant William Clark, with 30 others, went up the Missouri River.  This expedition crossed the Continental Divide of the Americas, eventually coming to the Columbia River, and the Pacific Ocean in 1805.  They spent the winter in North Dakota.  The return voyage began on March 23, 1806, after they spent another winter there in Oregon, ending their trip six months later at St. Louis in September 23, 1806.  President Thomas Jefferson commissioned the expedition, shortly after the Louisiana Purchase of 1803, to explore and detail as much of the new territory as possible.  The expedition returned to St. Louis to report their findings to President Jefferson with maps, sketches, and various journals that were not published until years later.  Thus, this expedition made notable contributions to science.  Congress appropriated $2,324 for supplies and food.  The route of Lewis and Clark’s expedition took them up the Missouri River to its headwaters, then on to the Pacific Ocean via the Columbia River.  While accounts vary, it is believed the Corps had as many as 45 members, including the officers, enlisted military personnel, civilian volunteers, and York, an African-American man enslaved by Clark.  The Lewis and Clark Expedition established relations with two dozen Native American nations, without whose help the group would have risked starvation during the harsh winters.  By April 25, 1805, Captain Lewis wrote his progress report of the expedition’s activities and observations of the Native American nations they had encountered to-date.  They followed the Missouri River to its headwaters, and over the Continental Divide, then north to Traveler’s Rest.  They descended on foot, then proceeded in canoes down the Clearwater, Snake, and Columbia rivers, and present-day Portland, at the confluence of the Willamette and Columbia Rivers.  The expedition sighted the Pacific Ocean for the first time on November 7, 1805, arriving two weeks later.  During the winter at Fort Clatsop, Lewis committed himself to writing his journals with valuable knowledge, mostly about botany.  Their visit to the Pacific Northwest, maps, and proclamations of sovereignty with medals and flags were legal steps needed to claim title to each indigenous nation’s lands under the Doctrine of Discovery.  During the expedition, they contacted over 70 Native American tribes and described more than 200 new plant and animal species.  Jefferson had the expedition declare “sovereignty” and demonstrate their military strength to ensure native tribes would be subordinate to the U.S., as European colonizers did elsewhere.  The expedition was to make the native people understand that their lands now belonged to the United States and that “their great father” in Washington was now their sovereign.  Upon the return from their expedition, Lewis and Clark struggled to prepare their manuscripts for publication.  Clark managed to persuade Nicholas Biddle to edit the journals, which were then published in 1814 as the History of the Expedition Under the Commands of Captains Lewis and Clark.  It was not until 1904–1905, through the publication of Original Journals of the Lewis and Clark Expedition by Reuben Gold Thwaites, that people became aware of the full extent of their scientific discoveries made during their expedition.  During the 19th century, references to Lewis and Clark scarcely appeared in history books.  What do you know about Lewis and Clark?

The St. Louis Gateway Arch

At 630 feet, the St. Louis Gateway Arch is the world’s tallest arch and the tallest human-made monument in the Western Hemisphere, as it anchors downtown St. Louis.  The Gateway Arch was built as a monument to the westward expansion of the United States that has become an internationally recognized symbol of St. Louis, as well as a popular tourist destination itself.  The Arch was designed by the Finnish-American architect Eero Saarinen in 1947.  Construction began on February 12, 1963 and was completed on October 28, 1965, and opened to the public on June 10, 1967, located at the 1764 site of the founding of St. Louis on the west bank of the Mississippi River.  This permanent public memorial highlights the men who made possible the western territorial expansion of the United States, particularly President Jefferson, his aides Livingston and Monroe, the great explorers, Lewis and Clark, and the hardy hunters, trappers, frontiersmen, and pioneers who contributed to the territorial expansion and development of these United States.  In 1953, a bill authorized the allocation of no more than $5 million to build the arch.  After the visitor center opened, the arch tram began operating on July 24, 1967, although the arch was dedicated by Vice President Humphrey on May 25, 1968, my birthday.  Since the 1960s, the arch has led to almost $503 million worth of construction.  The arch is hollow to accommodate a unique tram system that takes visitors to an observation deck at the top that looks out at the Mississippi River.  This arch is a weighted catenary, so that its legs are wider than its upper section.  In July 1998, funding for an arch lighting system was approved.  On January 15, 1969, a visitor from Nashville, Tennessee, became the one-millionth person to reach the observation area.  The ten-millionth person ascended to the top on August 24, 1979.  We would have been closer to that.  In 2010, the Gateway Arch had over four million visitors, with one million traveling to the top.  The underground 70,000-square-foot visitor center for the arch is located directly below the arch, between its legs.  Near the top of the Arch, passengers exit the tram compartment and climb a slight grade to enter the observation area that offers views up to 30 miles.  Each tram is a chain of eight cylindrical, five-seat compartments with glass doors with a capacity of 40 passengers, departing every 10 minutes.  The cars swing like Ferris-wheel cars as they ascend and descend the arch in a trip that takes three minutes.  I thought that this one of the best parts of my experience there, besides the observation deck.  People have tried to do all kinds of stunts on this arch.  The Gateway Arch packs a significant symbolic wallop just by standing there since it has inspired poems and movies that have used it as a background.  I really liked the symbolism of this monument to western American expansion.  Have you ever been in the St. Louis Gateway Arch?

A tour of the Anheuser Busch factory in St. Louis

In 1979, Anheuser Busch had daily tours to the main office, the stock house, and the brew house.  It was a lot like the Guinness Beer factory tour in Dublin, Ireland.  Anheuser-Busch Company was an American brewing company headquartered in St. Louis, Missouri.  However, since 2008, it has been wholly owned by Anheuser-Busch InBev SA/NV, now the world’s largest brewing company, which owns multiple global brands, notably Budweiser, Michelob, Stella Artois, and Beck’s.  This company employs over 19,000 people, with 12 breweries and 9 aluminum-can plants in the United States. In 1852, German American brewer and saloon operator George Schneider opened the Bavarian Brewery of South St. Louis.  From 1860 to 1875, the brewery was known as E. Anheuser & Co.  Adolphus Busch, a wholesaler who had immigrated to St. Louis from Germany in 1857, married Eberhard Anheuser’s daughter, Lilly, in 1861.  Following his service in the American Civil War, Busch assumed the role of company secretary until the death of his father-in-law.  Anheuser-Busch was one of the first companies to transport beer nationwide using railroad refrigerator cars and the first to bottle beer extensively.  In 1876, Busch took the already well-known name Budweiser and used it for his new beer, even though his product had no connections to the city of Budweis, so that it became known as a “premium” beer.  The company was renamed Anheuser-Busch Brewing Association in 1879.  In 1896, Anheuser-Busch introduced its new “super-premium” brand, Michelob.  After the death of Adolphus Busch in 1913, control of the company passed to his son, August Anheuser Busch Sr., who continued to combat the rise of the prohibitionists.  Prohibition in the United States dealt a major blow to the company in the 1910s through the 1930s.  In 1957, Anheuser-Busch became the largest brewer in the United States.  The various presidents were:1860–1880 Eberhard Anheuser; 1880–1913 Adolphus Busch; 1913–1934 August A. Busch Sr.; 1934–1946 Adolphus Busch III; 1946–1971 Gussie Busch; 1971–1974 Richard A. Meyer; 1974–2002 August A. Busch III; 2002–2006 Patrick Stoke; and 2006–2008 August A. Busch IV.  Have you ever been to the Anheuser-Bush St. Louis brewery?

St. Louis, Missouri

St. Louis is a city in Missouri, located near the meeting of the Mississippi and the Missouri Rivers.  In 2020, the city proper had a population of only 301,578, while its bi-state metropolitan area, which extends into Illinois, had an estimated population of over 2,800,000, the largest metropolitan area in Missouri and the second largest in Illinois.  The city’s eastern boundary is the Mississippi River, which separates Missouri from Illinois.  The Missouri River forms the northern line of St. Louis County, except for a few areas where the river has changed its course. The Meramec River forms most of its southern line.  The land that is now St. Louis has been occupied by Native American cultures for thousands of years before European settlement.  St. Louis, the city, was founded on February 14, 1764, by French fur traders, named for King Louis IX of France.  Thus, it quickly became the regional center for the French inhabitants.  In 1804, the United States acquired St. Louis as part of the Louisiana Purchase.  In the 19th century, St. Louis developed as a major port on the Mississippi River.  From 1870 until 1920, it was the fourth-largest city in the country.  In 1904, it hosted the Louisiana Purchase Exposition, also known as the St. Louis World’s Fair, and the Summer Olympics, the first non-European city.  European exploration of the area was first recorded in 1673, when French explorers Louis Jolliet and Jacques Marquette traveled through the Mississippi River valley.  Five years later, La Salle claimed the region for France known as Louisiana.  During the American Revolutionary War, St. Louis was unsuccessfully attacked by British-allied Native American in the Battle of St. Louis.  After the Louisiana Purchase in 1804, St. Louis became the capital and gateway to the new territory.  Shortly after the official transfer of authority was made, the Lewis and Clark Expedition was commissioned by President Thomas Jefferson. Settled by many Southerners in a slave state, the city was split in political sympathies and became polarized during the American Civil War.  After the war, St. Louis profited because of trade with the West.  Industrial production continued to increase during the late 19th century.  In the first half of the 20th century, St. Louis was a destination for the Great Migration of African Americans from the rural South seeking better opportunities.  St. Louis, like many Midwestern cities, expanded in the early 20th century due to industrialization.  Suburbanization from the 1950s through the 1990s dramatically reduced the city’s population, as did restructuring of industry and the loss of jobs.  St. Louis has lost 64% of its population since the 1950 United States census.  Since 2014, the city of St. Louis has had one of the highest murder rates, per capita, in the United States.  In 2016, St. Louis was the most dangerous city in the United States with populations of 100,000 or more, ranking 1st in violent crime and 2nd in property crime.  Yet there are some nice places to see in St. Louis like the Art Museum, the Missouri Botanical Gardens, the Cathedral Basilica of St. Louis, City Hall, the Central Library, the Old Courthouse, St. Louis Science Center, Union Station, and the St. Louis Zoo.  Have you ever visited St. Louis?

We took a vacation trip to St. Louis, Missouri

As soon as school finished at St. Lawrence O’Toole in 1979, we set out for a vacation in St. Louis and the Missouri Ozarks.  In fact, we have been to St. Louis, a few times.  I have my scrapbook for this trip and our week in the Missouri Ozarks.  I wanted Margaret and Joy to have a summer vacation before I started at the CBOE in late June.  Besides, I had vacation time coming from my time at Montgomery Ward.  I have nine postcards from this trip to St. Louis, from the Gateway Arch, Busch Stadium II, home of the St. Louis Cardinals baseball team then, and the Anheuser Busch factory, since we took a tour of the brewery.  After our short trip to St. Louis, we were going to drive out to the Ozarks in southwestern Missouri.  I wanted Margaret and Joy to have a good vacation in one place.  We might not have many more vacations, since I was going to run a one-man options market maker operation.  Have you ever had a vacation in one place?

I was leaving Montgomery Wards

In May, 1979, it was beginning to hit me.  I was turning 40, and I was about to start a new adventure.  I was going to leave the place that I had worked at for eight years, since I started in June, 1971.  I had gotten to know my work friends at the Montgomery Wart Outlet Store in Franklin Park.  I was a little sad in leaving.  I suddenly realized that I had never been at one place for more than a couple of years.  I was at Granville, Wisconsin, for two years, and at Benburb, Norther Ireland, for nearly two years.  I only spent a year and a half at Loyola and Lake Bluff, Illinois.  However, I had spent four years in Louvain, Belgium, and Trier, Germany, the longest that I had been anywhere.  I was barely over a year at CTU in Chicago, and barely three years in Hyde Park.  Now I had spent six years in Matteson, and eight years here at Montgomery Ward.  I had a certain routine to my life.  I had become accustomed to hour long commutes.  I was always excited when the trip took less than ¾ of an hour.  I knew the people at work.  I even knew some of the people in the warehouse.  These were my work friends.  Would I have the same kind of friendship with my new workers at the Chicago Board Options Exchange?  We had no formal going away party.  A bunch of us, about 15-20, got together at a pizza place off Manheim Road and sat around after we closed the store at 5:00 PM on one Monday evening.  I realized that I hardly knew them that well.  We never socialized outside of work, since many of them lived in the northwest side of Chicago or in the northern or western suburbs, not like me in the south suburbs.  Everyone wished me well.  I could not tell whether Jerry Syndorwicz was happy about me leaving or not.  Anyway, they were staying and I was leaving.  Have you ever left a work place?

Rent or buy?

I had done some research on options trading and Jerry’s friend Marshall Katz wanted to know if we wanted to lease a seat, rather than buy it.  Jerry said no, but I began to think about it.  How much would it cost per month?  Marshall said that I could rent a seat for around $2,000 per month.  I could be a trader on the floor with no cost to trade the options since Katz, Scher, and Company would be the clearing house.  I would be a market maker, or in floor slang they called it scalping.  You bought a stock option at one price and sold it right away for a higher price.  I began to study stock options more seriously.  If there were large movements on a stock, the options gave you more leverage.  There were put and call options with all different dates.  I was more intrigued.  I watched the options markets for a couple of weeks to get a feel for the price fluctuations.  The options were much cheaper than the stocks, but the risk was greater with the options, since they all had limited time frames.  I saw the possibilities, but I was still not sure.  I did not have a lot of assets, since the equity in my house was out of bounds.  However, if I traded options on a monthly basis, I could get out of it, if it was not working out.  How could I study all these stocks and their potential movements?   Then Marshall Katz explained to me that the most liquid stock was IBM and I could be a day trader there and close out my account every day.  Thus, there would not be any great risk.  Finally, I decided to take an option on the Chicago Board Options Exchange (CBOE).  I talked it over with Margaret and she basically said if that was what I wanted to do, it would be okay with her.  I would be like a renter with no equity, but I was renting an options seat with the option to buy.  Have you ever heard about Stock options seats being rented?

Stock option contracts

The stock option contract is what was traded on the floor of the exchange.  You could purchase a contract to buy a certain amount of a stock with a certain fixed price with a fixed date in the future.  This was named a call option.  I would pay to buy an option to purchase IBM in August at $120.00, if it is selling presently at $115.00, if this was April.  I could sell this option contract if IBM went higher or exercise the option to buy the stock at $120.00, even if it was at $125.00.  Either way, I was a winner.  However, if IBM went lower, then I could sell the option at a loss or keep it to the bitter end and lose everything.  The reverse was true for put contracts.  This was an option to sell a stock within a defined period.  In put options, I did not have to own the stock, so that they became known as “naked options.”  Thus, with a small investment, I could have a bigger increase when the underlying stock did well.  About 80-90% of the trades were calls, rather than puts.  Even the loses were limited to the options price not the price of the underlying stock.  The prices were set by the market makers in the pits.  The options price could be between 1/16, 1/8, 3/16, 1/4, 5/16, 3/8, 7/16, 1/2, 9/16, 5/8, 11/16, 3/4, 13/16, 7/8, 15/16, or 1.  They eventually eliminated the 1/16 and keep the prices at 1/8.  Most transactions were either 1/8 or 1/4.  The future pricing was normally in implements of $5.00, $10.00, or $15.00, so that the most traded options were the near options that were due the next month.  Have you ever traded stock option contracts?

The Chicago Board Options Exchange (CBOE)

The Chicago Board of Trade, one of the oldest futures trading exchanges founded in 1848, established a separate Chicago Board Options Exchange in 1973.  They had spun off stock options and set up a whole floor for them.  This CBOE was the first exchange to list standardized exchange-traded stock options on April 26, 1973, in celebration of the 125th birthday of the CBOT.  In fact, Milton Friedman (1912-2006), the University of Chicago Noble Peace Economist, wrote an article about the importance of stock options in 1971.  The first year this new CBOE traded two million contracts on 16 stocks, but by 1978, they traded over thirty-three million contracts on 220 stocks.  Stock Options had become a billion-dollar business.  The Securities and Exchange Commission (SEC) regulated these markets.  Thus, it was member owned for several decades, until March 11, 2010, when the Chicago Board Options Exchange (CBOE) filed paperwork to launch an initial public offering and began trading on the NASDAQ stock exchange on June 15, 2010.  In 2011, the CBOE Stock Exchange (CBSX) entered into an agreement to acquire the National Stock Exchange, with both exchanges to operate under separate names.  The National Stock Exchange continued to be based in Jersey City, but ceased operations in May 30, 2014.  Thus, CBOE operates in North America, Europe, and Asia-Pacific, providing platforms for trading options, futures, equities, and foreign exchange.  In addition to its exchanges, the CBOE operates clearing houses.  Headquartered in Chicago, the CBOE operates a trading floor for open outcry trading, at 433 West Van Buren Street in Chicago, the largest U.S. options exchange with an annual trading volume of around 1.27 billion.  Today, the CBOE offers options on over 2,200 companies, 22 stock indices, and 140 exchange-traded funds.  Do stock options have any appeal to you?

The history of stock options

The basic concept of options contracts is believed to have been established in Ancient Greece.  The earliest recorded example of options was referred to in a book written in the mid fourth century BCE by Aristotle (384-322 BCE), a Greek philosopher of great influence and writer on many subjects.  In this book, entitled Politics, Aristotle included an account about another older philosopher, Thales of Miletus (626-548 BCE), and how he had profited from an olive harvest.  Thales paid the owners of olive presses a sum of money to secure the rights to use them at harvest time.  When the huge harvest time came around, Thales resold his rights to the olive presses to those who needed them and made a sizable profit.  Thales had effectively created the first call option with olive presses as the underlying security.  Another relevant occurrence in the history of options was an event in 17th century Holland which is widely referred to as the Tulip Bulb Mania.  At that time, tulips were incredibly popular in the region as status symbols among the Dutch aristocracy that also spread throughout Europe.  During the 1630s, the demand for tulip bulbs continued to increase and because of this, the price also went up in value.  The value of tulip bulb options contracts increased as a result. A secondary market for these contracts emerged which enabled anyone to speculate on the market for tulip bulbs.  However, ordinary people lost all their money and their homes when the Dutch economy went into a recession because of this unregulated options market.  London, England, banned puts and calls for a hundred years.  An American financier by the name of Russell Sage (1816-1900) in the late 19th century began creating calls and puts options that could be traded over the counter in the United States with no formal exchange market.  Sage eventually stopped trading in this way because of significant losses.  There have always been local brokers but they always had to find individuals on the other side of the trade.  The market for options continued to essentially be controlled by put and call brokers with contracts being traded over the counter, so that it was illiquid with limited activity at that time.  Even though the Securities and Exchange Commission (SEC) in the United States had bought some regulation into the over-the-counter options market, by the late 1960s the trading of them wasn’t really progressing at any noticeable rate. There were too many complexities involved and inconsistent prices made it very difficult for any investor to seriously consider options as a viable tradable instrument.  In 1968, the Chicago Board of Trade saw a significant decline in the trading of commodity futures on its exchange, and the organization began to look for new ways to grow their business.  After considering numerous alternatives, the decision was made to create a formal exchange for the trading of options contracts.  There were many hurdles to overcome for this to become possible, but in 1973, the Chicago Board of Options Exchange (CBOE) began trading. For the first time, options contracts were properly standardized and there was a fair marketplace for them to be traded.  At the same time, the Options Clearing Corporation was established for centralized clearing and ensuring the proper fulfillment of contracts.  This removed many of the concerns investors still had about contracts not being honored.  Over 2,000 years after Thales had created the first call, the trading of options was finally legitimate.  Options trading continues to grow in popularity and shows no signs of slowing down.  Have you ever considered trading a put or call stock option?