Today, the New York Stock Exchange (NYSE) is a global institution. Billions of shares in thousands of companies are traded there every day, but it had an interesting and, dare I say humble, beginning.
I heart NA?
The NYSE was not the world’s first stock exchange – Amsterdam did it a few years earlier. (Now it’s part of the Euronext Exchange). But it’s no coincidence NYC wasn’t far behind. After all, New York was originally a Dutch settlement called New Amsterdam.
The Dutch gave it up to the English in 1664 in exchange for control of the Spice Islands, and the English – paragons of naming – rechristened it after the Duke of York.
The Tree that Launched a Thousand Stocks
Before the ticker tape and the bell, the earliest stock traders of NA/NY chose for their exchanging activities a nice, shady spot under a buttonwood tree outside what is now 68 Wall Street.
As time went on (more than 100 years), the brokers decided to set down some basic rules. On May 17, 1792, twenty-four of them wrote and signed America’s first trading regulations. The “Buttonwood Agreement” was only two sentences long. The brokers agreed that:
1) They were only allowed to trade with each other (they didn’t like auctioneers), and
2) the commissions on trades would henceforth be 0.25%.
“We the Subscribers, Brokers for the Purchase and Sale of the Public Stock, do hereby solemnly promise and pledge ourselves to each other, that we will not buy or sell from this day for any person whatsoever, any kind of Public Stock, at a less rate than one quarter percent Commission on the Specie value and that we will give preference to each other in our Negotiations. In Testimony whereof we have set our hands this 17th day of May at New York, 1792.”
Why is it called “Wall Street”?
Wall Street was Wall Street before New York was New York. The now world-famous street was once a lowly pathway that ran alongside a wall, which was built to keep the Native Americans out. It turns out the Dutch were just as creative at naming as the English were.
Now “Wall Street” is more than a location on a street map, it’s an adjective, an ideal, and the mecca of the finance industry.