An Overview of the Stock Market's Past

 An Overview of the Stock Market's Past

 

Recognizing that the precise origins are lost in the mists of time is the first step in any brief history of the stock market or share trading. While most brief histories of stock market trade begin with Muslim and Jewish merchants in Cairo establishing the first stock market, traditionalists argue that the oldest markets were actually in Italy.



We may probably certainly trace the origins of share trading markets similar to what we know today to the Italians of the thirteenth century. Even as early as the time of the Venetian merchants, insider trading was likely taking place in the markets for government securities. Indeed, a statute was enacted in Venice in 1351 to prohibit the dissemination of rumors with the intent of causing prices to fall.



There was a growing need for stock markets as formal commerce expanded across Europe. Amsterdam started to emerge as Europe's primary stock exchange in the 1600s and 1700s. The initial public offering (IPO) of stocks and bonds took place there. When the Amsterdam Stock Exchange initially began selling shares, it was the Dutch East India Company that did it.



Because of their early pioneering work in this area, the Dutch were able to create many of the financial tools with which we are all familiar. Their groundbreaking innovations included traded options, unit trusts, short selling, and debt-equity swaps.



Other nations quickly started to look for ways to mimic the Dutch model of commerce after the early success of the Dutch pioneers. The English may have achieved the greatest degree of success through the London Stock Exchange. It is still widely believed that the London Stock Exchange (LSE) is the best stock market in the world.



When Alexander Hamilton, the first American Secretary of the Treasury, sought to initiate the establishment of economic dominance in the New World, he went to London. In the late 18th century, Hamilton established the New York Stock Exchange on Wall Street. About fifty years later, the American Stock Exchange became a part of it. Aside from Amex, the NYSE is still on Wall Street.



The Dutch East India Company is only one of many legendary stock market success tales. A great number of spectacular financial disasters have also occurred. There is a fascinating and brief history of stock market trading, which includes two of the most noteworthy events—the South Sea Bubble and the 1929 Wall Street crash—but all of them contribute to the whole.

Location:

Share :