Personal Finance/Assets/Stock
United States
[edit | edit source]The Stock Market building resembles the New York Public Library. On the entrance building the sign reads "New York Stock Exchange". This is the heart and soul of all of the United States' major financial institutions. It is today what Fort Knox was almost two hundred years ago - the place where billions of dollars of wealth changes hands daily. A symbol of capitalism in action.
The New York Stock Exchange has been the targeted by terrorism in the past. However, the physical destruction of the building would have little effect as the majority of the exchange trading is computerized with backup computers located in a different locations.
Most major American companies like Microsoft, IBM, Pfizer, Lockheed Martin, and Apple trade on the NYSE or NASDAQ. Foreign companies may be ADRs on the OTC Markets (e.g. Tencent). However, some are not traded, like Koch Industries. Anyone can own a piece of any corporation that is publicly traded by purchasing some shares and becoming a stock holder. A popular way is through a broker.
How the Stock Market was founded
[edit | edit source]Let’s see how the stock market founded. Two hundred years ago in front of Trinity Church in Manhattan a few business men got together to exchange merchandise with each other. At that time the monetary system we know today did not exist. Paper money did not exist - gold and silver coins were used. These unknown businessmen made an agreement amongst themselves that promised a share of the value in ships transporting goods from abroad. This was the beginning of a new trade that eventually lead to the NYSE being born.
Years later during the American Revolution the United States Government needed money. In their effort to raise capital for the war, government bonds were invented. Our forefathers needed money to continue their cause so they asked people to lend money to the Government. The people were issued with a "bond" showing how much they had lent, which paid interest every year. After the term of the bond expired, usually thirty years, the Government repaid the money. These bonds are now known as Treasury Bonds and are sold throughout the world.
Then in 1792 twenty four businessmen gathered together and signed an agreement to do business among themselves. This included selling shares, or part of their companies, to each other. The modern New York Stock Exchange was born.
The industrial revolution brought more prosperity for Wall Street. Everyone was interested in having "a piece of the action". Not all the stocks being sold were of good and reliable companies, and the NYSE would not deal with them. So, these stocks were sold outside of the building - by the curb. At that time these kinds of deals were referred to as “curb treading" - eventually they would become the American Stock Exchange (AMEX).
Today NASDAQ, NYSE and AMEX have been combined. They are located at 60 Wall Street, New York City which is part of lower Manhattan. AMEX is now mostly gone because NYSE Euronext has acquired it.