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Bubbling crude on a hill in 1921 set off boom times for El Dorado

by Andrew Moreau | January 10, 2021 at 2:09 a.m.

El Dorado's future came a bubbling out of the ground 100 years ago today, making the city the oil capital of Arkansas and creating a boom that sent gushers of speculators and others looking to capitalize on the discovery.

On Jan. 10, 1921, Dr. Samuel T. Busey, who the Encyclopedia of Arkansas describes as "a globetrotting physician and oil speculator" and claimed to be a descendant of Daniel Boone, drilled a well on a small hill 1 mile outside the then city limits.

At 4 p.m., the 120-foot-derrick, with a drill reaching 2,233 feet down, began to shake, sending workers and spectators running for cover. Gushing oil was sprayed up to a mile away and historical estimates say that between 3,000 and 10,000 barrels came roaring out.

The future had arrived and El Dorado was overwhelmed with folks looking for jobs, speculators seeking riches and legislators wanting to help the state profit from the discovery.

Legislators arrived immediately on a train from Little Rock to inspect the well. Soon after, 22 trains from Little Rock and Shreveport were going in and out of the area every day.

The mostly agricultural community of 4,000 exploded.

By March 1921, Arkansas produced 38,000 barrels of oil, increasing to 325,000 barrels by April, to 578,000 barrels by May and to 908,000 by June. A year later, 900 wells were in operation in the state.

By 1923, El Dorado supported 59 oil companies, 13 oil operators and 22 oil production companies. Bed space was filled and shacks and tents were hastily thrown up across the city. El Dorado's population reached a high of 30,000 in 1925 before the boom began to fade.

El Dorado's future outlook dimmed a bit last year -- again related to the oil industry. Murphy Oil Corp., which can trace its roots to the boom period and has made significant contributions to the growth and development of the city's business, education and cultural efforts, announced that it was closing its corporate headquarters in the city and moving to Houston.

Another odd twist to the story: The nation experienced a diphtheria epidemic with more than 200,000 cases reported in 1921. By the mid-1920s, a vaccine was being used that wiped out the threat. Today, more than 80% of children are vaccinated and antibiotics decimate the bacteria for those who get infected.

Thank you to the Encyclopedia of Arkansas for the historical insight into the El Dorado oil boom.

PANDEMIC BLUES

Arkansas does not fare well in a study that shows the best places to find a job this year during the pandemic. Indeed, Little Rock ranks 94th in the nation and Fort Smith falls in at 132nd.

The rankings from WalletHub are topped of by South Burlington, Vt., getting the highest ranking of metropolitan areas.

The survey also reported that Gilbert, Ariz., has the highest median annual household income at $97,934, which is 3.5 times higher than Newark, N.J., which has the lowest household income at $28,227.

Little Rock has a median annual income of $53,855 and Fort Smith is at $50,883, according to WalletHub.

San Jose, Calif., has the highest monthly average starting salary at $6,327. Laredo, Texas, is at the bottom with $2,058 per month.

In Little Rock, the average monthly starting salary is $2,242 and the average starting pay in Fort Smith is $2,102.

WalletHub is an online financial services network.

MERGING WEALTH

Two independent Arkansas wealth management firms are combining resources to become one of the largest providers in the state.

Legacy Capital Wealth Partners and Trent Capital Management are merging and will have more than $525 million in assets under management. The new company, called Legacy Capital, will be based in Little Rock and also provide more than $2.5 billion of in-force life insurance.

Legacy Capital offers comprehensive wealth management services to individuals and families, including financial planning, asset management, legacy and estate planning as well as insurance services.

"With the merger, we have increased our focus on building the region's most sophisticated wealth management firm – one that will also attract other client-focused advisors who are looking for a better alternative to how they serve their clients," Legacy Capital President Matt Jones said.

ECONOMIC FORECAST

Looking for insight into the 2021 economy?

The Arkansas Bankers Association and the Arkansas State Chamber of Commerce are teaming up to provide a virtual economic forecast 10-11 a.m. on Jan. 20.

Michael Pakko, state economist at the Arkansas Economic Development Institute, will provide a forecast for Arkansas and Tyler Mondres of the American Bankers Association will provide national projections.

Presentations will highlight economic trends and early patterns to predict how the state and national economies will perform this year.

Registration and details are available at arkbankers.org.

MORE FORECASTING

Business leaders in the Midwest region that includes Arkansas do not have a shiny view of the economy as coronavirus cases surge.

A study by Creighton University reports that its business confidence index in December dropped below 50 -- considered neutral -- to 45.8 in December. It is the second-straight month the index has fallen.

"A sharp upturn in covid-19 infections, along with more economic lockdowns, weighted on December's economic outlook," said university economist Ernie Goss.

In overall economic performance in 2020, Arkansas ranked third of the nine states in the survey. Nebraska was at the top and North Dakota at the bottom. The survey includes South Dakota, Missouri, Kansas, Oklahoma, Iowa and Minnesota.

The university conducts a monthly survey of the nine states in the region and, until November, the index climbed every month since April, when the index fell to its lowest level in 11 years because of the covid-19 outbreak.

Companies report they are still hiring but have a dim of future prospects. The overall index dipped to 64.1 in December from November's 69. A score above 50 indicates growth and a score below 50 suggests recession.

Column ideas or recommendations? Thoughts or musings that need pursuing? Contact me at amoreau@adgnewsroom.com or at 501-378-3567.

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