The History of the Stock Market

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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 1700's where stocks were already around for a long time before that but it wasn't 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 Philadelphia Board of Brokers set up rules and central offices where trading could take place. They created the Philadelphia Stock Exchange which is the oldest stock exchange in the United States. In 1817, New York brokers created the New York Stock and Exchange Board which was later renamed to the New York Stock Exchange in 1863.

The United States grew and prospered during the 19th century and more and more companies issued stocks and bonds. More and more people began to invest and many stock exchanges were created all around the country. However, few companies held on and eventually broke up due to other exchanges getting bigger. One of the most popular exchanges in the world today is the New York Stock Exchange. It is one of the oldest exchanges in the United States formed about 20 years or so after the Philadelphia Stock Exchange. One of the short lived companies were the small exchanges formed during the California Gold Rush of 1849. There gave birth to many small exchanges where the pub...

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...he Nikkei index of the company TSE dropped almost 50 percent. They eventually rose back up after 1990.

After the 1987 crash, the government established new rules for higher margins. It is unknown whether these new regulations and margins will help investors from getting into another crash in the future.

Currently, there are many companies that do not list there stocks on any exchange. These are what make up the Over-the-Counter market. The largest of these companies is NASDAQ, which stands for the National Association of Securities Dealers Automated Quotation system. Mostly high tech companies invest in these markets and they are usually the smaller companies. Larger companies would rather choose the exchanges since they are bigger and more popular stocks.

Bibliography:

Microsoft Encarta 98 Encyclopedia CD-ROM

Stock Exchange, by Samuel Case

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