Buttonwood to Billions: A History of The US Stock Market

Buttonwood to Billions: A History of The US Stock Market

Copyright (c) 2010 John Howell The US stock market, also known as the New York Stock Exchange (NYSE) is by far the largest stock exchange by market capitalization in the world. By May of 2010, its listed companies represented US$12.25 trillion of the world's money. In the 18th century, when the US stock market got its start, those numbers would have been practically unimaginable. History tells us that the US stock market began when 24 stock brokers met in New York City to sign the Buttonwood Agreement on May 17, 1792. It's no coincidence that it's called that - the signers met outside of a building at 68 Wall Street under a buttonwood tree. At the time, New York City was the first capital of the United States. The buttonwood signers met in a room at 40 Wall Street where the stocks and exchanges of the US stock market's budding businesses began. In 1817, the organization drafted a constitution to officially rename the US stock market the "New York Stock and Exchange Board". The name was later shortened to "New York Stock Exchange" in 1863. By 1901, the US stock market had increased its volume of stocks six fold and a larger space was needed to accommodate all of the stock brokers. A new building, the US stock market's current home, was constructed at 18 Broad Street and opened on April 22, 1903. At the time, the building's 109 x 140 foot trading floor was one of the largest interior spaces in New York City. Today, the building is listed as a National Historic Landmark. Perhaps the most important and pivotal moment in the US Stock Market history came with the Crash of 1929. On October 29, 1929, stock prices began to plummet from what had been an unprecedented high and continued to fall for a full month afterward. That week alone, the US stock market lost $30 billion in value. The resulting "crash" set off a series of events that led to The Great Depression, the most devastating economic slump in United States History. Most recently, the United States' stock market experienced what has been called a Flash Crash when 998-point loss was posted and then suddenly rebounded within a matter of minutes. It was thought that the crash was caused by a keying error called the "fat-finger trade" during a sell by homegoods giant Proctor and Gamble, but the Securities and Exchange Commission has published a report saying it's not clear what was to blame.
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