The History of the Stock Market Essay - 830 Words

The History of the Stock Market In the beginning, there was no real stock market. However stock exchanges did take place in smaller groups and corporations. This all took place during the 1700s where stocks were already around for a long time before that but it wasnt really popular in the United States. Stocks originally started as auctions where traders called out names of companies and the shares available. There was a auction that took place and the shares went to the highest bidders. After the American Revolution which took place between 1775 to 1783 the number of securities increased dramatically. The amount of shares being bought grew so large that brokers had to organize in order to handle the growing volume. In 1800 the†¦show more content†¦During the 2nd half of the 19th century New York City became the central financial center of the United States. After that the New York Stock Exchange became the number one trading center. The reason for this being that its members focused on buying securities o f larger corporations. At that time all the smaller stocks of smaller companies were handled on the streets of downtown New York City. In 1908 these brokers formed the New York Curb Agency which is now known as the American Stock Exchange. It was renamed to this in 1953. During the 1920s millions of Americans began investing in stocks for the first time. They heard about how rich people were getting by investing so they all decided to do it. Many new investors entered the stock market using borrowed money. Stock market prices rose steadily as inflated market demand outpaced increases in the capital value of businesses. Investors began to realize that a large imbalance existed between stock prices and the amount of money needed to back them up, and began to sell. On October 29, 1929, great numbers of people tried to sell their stocks all at once. This created chaos in the accounting of stocks and for brokers. The New York Stock Exchange and other exchanges prices dropped so dramatica lly that this event became known as the crash of 1929. Millions of investors lost their savings in the crash and many were deeply in debt sinceShow MoreRelatedThe History of Stock Markets715 Words   |  3 PagesThe history of stock markets goes back to the 12th century France where the debts of communities were managed by courretiers de change on behalf of local banks. They were essentially the first brokers. Trade of government securities was initiated by venetian bankers in the 13th century. It was illegal to spread rumours that would have an effect on the price of government securities. Such trace was only possible due to the fact that these areas were run by a cabinet of authoritative civilians ratherRead MoreHistory of the Stock Market2441 Words   |  10 PagesThe financial markets of the United States, today, are collectively known as Wall Street. 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