Wall Street Story

You have only two chances in Wall Street; Grave Yard or Play Ground.

Monday, April 9, 2007

The Birth of Wall Street

Early Manhattan Right now, the New York Stock Exchange has billions of dollars changing hands every day, with thousands of companies being traded, and millions of people being affected. If we trace the roots of the New York Stock Exchange to its beginning, we would find that it started out as dirt path in front of Trinity Church in East Manhattan 200 years ago. At that time, there was no paper money changing hands, or even the idea of stocks. Rather, they traded silver for papers saying they owned shares in cargo, that was coming in on ships every day. The trade flourished.

During the American Revolution, the Colonial Government needed money to fund its wartime operations. One way they did this was by selling bonds. Bonds are pieces of paper a person buys for a set price, knowing that after a certain period of time, they can exchange their bonds for a profit. Along with bonds, the first of the nation's banks started to sell parts or shares of their own companies to people in order to raise money. In essence they sold off part of the company to whomever wanted to buy it, which is the essence of the modern day stock market.

NYSEWall Street was becoming a major center of these transactions, and in 1792 twenty-four men signed an agreement that started the New York Stock Exchange (NYSE). They agreed to sell shares or parts of companies between themselves and charge people commissions, or fees, to buy and sell for them. They found a home at 40 Wall Street in New York City. As they grew they later moved into what is currently the New York Stock Exchange Building.

ASEThe 1900s brought the Industrial Revolution, and along with it, a boom in Wall Street. Everybody wanted a piece of the action, and Wall Street grew. The New York Stock Exchange was not the only way to buy stocks at that time. Many stocks that were deemed not good enough for the NYSE, were traded outside on the curbs. This so called "curb trading," has now become the American Stock Exchange (AMEX).

Today, the New York and the American Stock Exchanges, have been joined by the NASDAQ, and hundreds of local and international Stock Exchanges, that all play a part in the national and global economy.

April 4th, 1644: Wall St. was born. Manhattan had a couple thousand Dutch settlers (notice the stepped roofs) living below Wall Street. Unlike the British colonies in Virginia, Rhode Island and Massachusetts, New Amsterdam (renamed New York in 1664) was exclusively a trading colony, set up to extract valuable resources from surrounding area. Beaver pelts, in particular, were in high demand in Europe.

The Dutch did not even need to trap them themselves, but could trade with the local indians who were much more adept at it. The Dutch provided the indians with wampum (sea shells collected off the banks of Long Island), liquor, guns and ammunition, in return for beaver pelts and anything else they needed. This was a double-edged sword, however, because these mercenary colonists tended to make quick enemies of the indians, and once they were armed with European weapons, they became a serious threat - hence, the wall.

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