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Stock Market – A Look Back at History

05.11.2009 · Posted in Finance Articles

The stock market is a place where businesses and individuals trade in shares and benefit from the returns. As an investor, an individual enjoys some amount of power over the company. This investor offers valuable financial support to the company and in return benefits from valuable returns. The number of shareholders owning a company could range from a few hundreds to thousands- depending on the size and requirement of the corporation. As a business grows, it requires adequate funds to realize its financial goals. When a company is in a state of substantial growth, it offers shares to the public to gain a stronghold in the market. Selling shares to the public has been a practice with many businesses since early times. nnCompanies selling portions of their business to the public is not something new. The financial market has always been a platform for buyers and sellers, where both parties share a mutually profitable relationship. The stock market is like the financial spine of a country- a place where shares of numerous companies are bought and sold. In the United States there are three share markets that play a crucial role in shaping the economy- Nasdaq, the New York Stock Exchange and the American Stock Exchange. nnWall Street is one of the most important financial center in the United States. During the 17th century, long before New York City became what it is today, there was a high wall built as a defense against British attackers. When the wall came down the name of the street remained, Wall Street. nnEven though we think of Wall Street as the financial hub of the United States, history has a different story to tell. You may not know that Boston was once the countrys financial hub. Boston dealers played an active part in buying and selling various kinds of commodities as well as dealing in bonds for contracts such as bridges and canals. It is indeed difficult to imagine the financial hub of America as something other than Wall Street. However history clearly states the importance of the Boston dealers in creating an active financial market, very much similar to the one found in Wall Street today. nnOther countries similarly conducted their financial dealings through their own financial marketplaces. For example, the city of Paris carried out its economic pursuits on Rue de Quincampoix. nnThe story of the London market is another interesting tale in the history of finance. The stock exchange in London was initially an open market based on Exchange Alley. Jonathans Coffee House was a popular financial center where many London dealers conducted their financial activities. This Coffee House was later renamed The Stock Exchange. nnOver the years, Wall Street gradually picked up business with varied kinds of traders offering countless shares to the public. As time went by, many new banks also began to operate in the market offering attractive deals such as treasury bonds.

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