The stock market is one of the biggest and most important markets in the world of trading. Certainly the most recognizable form of trading, stock trading is also among the three most popular trading markets today, exceeded only by foreign exchange.
Most of the time, when the stock market is brought up, people’s minds are drawn to the 1980s. And certainly this was an era that served the stock market quite well. For many, the 80s was the apex of Wall Street. However, the history of stock trading goes back much further and is truly fascinating. In this article, we are going to take a look the most important events in the history of stock trading.
The Earliest Origins
Today, most people are able to access the stock market through two means. Unless they are big name brokers, CEOs, bankers, or some kind of other business insider, most people will need to access discount brokerages or online trading platforms, such as https://tradingplatforms.com/uk/. However, this was not always the case. Up until as recently as 20 or so years ago, the market was considered a privilege. But, how did this privilege begin? Let us take a look at the earliest forms of stock trading in human history.
In the early 1200s, Belgium merchants would purchase shares in each other’s stores and then sell them for a higher profit. However, there were no companies as we know them back them. Still, this was an early iteration of what today we call the stock market. The 1200s were also the era when the Huis der Beurze was built. At the time, the financial center of the city, the establishment today has become Euronext, the biggest European stock exchange market.
The First Company to Sell Stocks
Historians have quarreled over the origins of stock trading for a long time. However, one thing that most seem to agree on is what the first company that began selling shares is. In this article, we are taking a look at the financial situation of the 1600s.
Due to a plethora of complicated events, which we haven’t the time to get into, the European nations of the late-1500s could not set up a trade route with the South Asian subcontinent. So, when in the 1600s, the Dutch East India Company was founded, many breathed a sigh of relief. Finally, a new land route to India had been opened.
Over time, the Dutch East India Company’s power, wealth, and influence grew, to the point that the Dutch government awarded the company a monopoly on intercontinental trading with India. In a couple of decades, the DEIC had become the biggest company in history and the first multinational company, with the power to influence politics.
So, when during the 1610s, the Dutch East India Company began selling its shares to private citizens, those with the money and power to join in did not wait around. This had been the first instance of a company selling its shares to the public, and is a momentous occasion in the development of the stock market further down the road.
The Founding of the New York Stock Exchange
Today, the most popular, most successful, and biggest stock exchange in the world is the New York Stock Exchange (NYSE), or more commonly and popularly known by its colloquial name, Wall Street. The NYSE makes up over 40% of the overall trades that are being done on the stock market in the entire world, and veterans consistently offer some tips and tricks for newcomers to the stock market. With a market capital of $26 trillion dollars, the NYSE is an absolutely dominant force in the industry.
But just how did it all begin? Well, it all went down in the late 1700s. It was in 1792 that the top merchants of New York City gathered in secret to discuss the problems that the market had been facing. Later that year, after they had gathered quite a few times, the twenty-four merchants co-wrote and signed a document which lead to the creation of the New York Stock Exchange. This document was named “The Buttonwood Agreement”, after the tree under which the merchants gathered, though interestingly, it is not the place where the document was signed.
The 1929 Market Crash
Finally, we are taking a look at one of the darkest times in the history of the Stock Market. The 1920s are often associated with glamor, splendor and extravagance. So, it came as a huge shock when the decade was capped off by one of the worst crashes in history. The 1929 crash served as a vanguard for the darkest period in American history, the Great Depression. The consequences of this crash were so severe, that the country was reeling from it all the way into the 40s. In fact, it was only post-World War II that the USA began to recover from the difficulties that came out of the Great Depression and the 1929 crash.
