What is the origin of Wall Street introduced by Nicolas Cage, a national treasure manager?

The origin of wall street

Wall Street originated in17th century, when it belonged to Dutch immigrants. This place called New Amsterdam is located at the front end of Manhattan Island, sandwiched between two rivers with convenient shipping. It is a natural deep-water port and it is easy to dock ships. Therefore, the Netherlands, which has a developed maritime industry, has taken a fancy to this position.

10 years later, the northern front line of new Amsterdam was replaced by a triangular fence "wall", which was 9 10 meters long, in order to guard against the new enemy-the British.

1664, the British and the Dutch launched a naval battle. The British army successfully occupied new Amsterdam, and the "city wall" did not play much defensive role. 1685, the British named this street "Wall Street". The English word "Wall" means "wall".

Wall Street is close to the port and has an important geographical position, which is of special significance to new york's commercial and financial activities. During the period of British rule, new york developed rapidly into a port city and gradually showed the embryonic form of an international metropolis.

Taking Wall Street as the city center is the decision of Thomas Tangan, the British appointed governor of new york. He secretly bought a large piece of land nearby in advance and then divided it into many small pieces for sale. 1686, wall street began large-scale construction and development, and he sold it for profit. Some people also saw the doorway and bought a lot of properties before the land price on Wall Street soared. /kloc-in the last decade of the 0/7th century, Wall Street took on a new look after expansion and transformation. The old wooden fence was demolished, the cornerstone was used to build the city hall, and the first Christian trinity church was built, thus opening an unprecedented but endless prelude to Wall Street.

Hamilton plan

Among the residents of Wall Street, alexander hamilton is the most famous. In the early history of the United States, some designers not only created the United States from scratch, but also pointed out the way for future development. Hamilton is one of them. Hamilton firmly believes that the new country should not only formulate a clear constitution, but also establish an effective operating system to formulate and implement commercial laws and regulations accordingly. According to one observer, Hamilton thought he was the federal prime minister during George Washington's presidency, not just the finance minister.

At that time, due to the influence of the war of independence, the total domestic and foreign debts of the United States amounted to $54 million, including $40 million of seriously depreciated mainland currency and $25 million of outstanding debts of state governments. The interest on the debt alone is as high as $4 million, and the annual tax revenue of the federal government is simply unable to pay.

In order to get out of trouble, Hamilton carried out a plan to raise money to pay off debts. He believes that funds should be concentrated on businessmen and brokers, who should invest in the future of the country. In order to win the trust of these new bourgeoisie, the state must invest in advance, and its own plan is one of the steps.

In the process of implementing the plan, Hamilton first began to issue new paper money to replace the mainland currency. Secondly, Hamilton issued federal bonds and raised $80 million. Bond trading is mainly for brokers and brokers in coastal commercial centers.

Wall Street brokers have long predicted that the face value of the mainland currency may recover. They buy in large quantities at very favorable discounts, exchange old coins for new ones, and then use the new coins to buy government bonds. When ordinary investors in the South Side of Manhattan hesitated, Wall Street brokers not only bought a large number of government bonds, but also bought a large number of mainland coins from southern States, almost equivalent to two-thirds of the total US debt.

In this way, the government has money, brokers hold government bonds, and worthless mainland coins have withdrawn from the circulation field. However, for brokers who can buy old coins at a very low price and then exchange them for new coins of the same amount, many old coin holders know nothing about this, and they never dreamed that this would happen and suffered heavy losses. It was this speculation that led to the first financial scandal on Wall Street.

The retribution for manipulating the market

1789 When the Ministry of Finance was established, Hamilton appointed Toure as assistant minister. But Toure resigned after only seven months in this position.

1790 65438+In February, Toure entrusted leonard Blick as an agent to go to South Carolina to buy old continent coins. There is evidence that Toure had started speculation before Blick went to South Carolina, when he was still working in the Ministry of Finance. His business partners, who are closely related to him, all know the news of Hamilton plan from him in advance, and most of them eat a lot of mainland coins at extremely low prices for hoarding.

Toure was not satisfied with speculating only in mainland currency, but also joined hands with others to secretly buy shares of Bank of new york in the market in an attempt to gain a controlling stake. Bank of new york is a state-owned commercial bank and an important basic raw material for Hamilton's financial feast. Because Bank of America is not a commercial bank, it can't absorb savings or carry out lending business, so Hamilton needs to be included in a reputable commercial bank in order to maintain financial stability and carry out the necessary government capital turnover.

Toure thought it was an opportunity to make money, and together with some famous people on Wall Street, he secretly started the monopoly operation of stock acquisition. Toure's attempt initiated market manipulation in the history of Wall Street. Its specific operation strategy is: when the stock price is low, buy as much as possible, then eliminate the negative factors that depress the stock price, push the price up, and then sell the stock in your hand. The problem is that as the monopolist keeps buying, market forces will naturally push up the stock price, which is exactly what the monopolist Man Cang tried to avoid before. In order to achieve this goal, Toure cleverly designed a trap in his operation to trick investors into believing that a new bank was being established and would compete with Bank of new york, which led to a sharp drop in the share price of Bank of new york. Since then, Toure has been trying to buy shares in Bank of new york. When all the funds and mortgage were exhausted, he began to raise money and borrow money from the general public in new york Central Street, with a monthly interest rate of 2%-4%.

179 1 In August, Hamilton began to have doubts about Toure, reminding him not to engage in speculative business that is inconsistent with his identity. Later, when he learned that Toure planned to piece together a new bank to compete with Bank of new york, Hamilton flew into a rage. In order to avoid putting the grand plan of establishing business reputation in the whole country in danger, Hamilton cooperated with the Bank of new york and refused the mortgage loan to prevent Toure and his associates from getting their hands on the Bank of new york.

Bank of new york will no longer provide loans to Toure and his partners. Because Toure has to pay 2%-4% monthly interest for fund-raising, once the cash flow is blocked, it will have a fatal impact. In this way, the pressure on Toure suddenly increased and disaster happened.

Toure was forced to declare that he could not pay interest. Once the news leaked, they were immediately besieged by investors, but it was too late. Some people described the chaotic situation at that time as follows: at night, people were noisy and thugs appeared in the city, accusing Toure, the father of profiteering, of plundering all the property and making them lose all their money. Angry people tried to get him out of prison, but they were stopped by the mayor and administrative officials. Because of cursed speculation, half the people in this city went bankrupt.

Buttonwood protocol

The financial scandal is one of the important events that led to the signing of the buttonwood agreement. Brokers hope to formulate public management regulations, standardize the financial market, so as to calm public anger, and at the same time take the restraint mechanism into their own hands.

It is said that a week after Toure was arrested and about two months before the buttonwood agreement was signed, a group of brokers gathered at Kerry Hotel on March 2 1. According to the report in the Official Gazette of the United States: "Businessmen and stockbrokers ... appointed a committee to report the laws and regulations related to the operation mode of commercial transactions and study whether their opinions are appropriate."

During the American Revolution, most trees were used to make fires, and there were few trees on the streets of Manhattan. Therefore, the surviving buttonwood tree in No.68 Courtyard of Wall Street is particularly eye-catching, and it has become a good gathering place under the shade. On May 1792 and 17, 24 brokers met under the tree and reached an agreement. The agreement has the nature of a medieval industry agreement, which stipulates that 24 signatories enjoy preferential treatment for each other when buying and selling bonds, and draw commissions at a uniform and fixed ratio:

We, the undersigned, as brokers who buy and sell public securities, hereby solemnly promise and assure each other that in future transactions, no matter who buys or sells any securities, we will draw a commission of not less than 0.25% of the transaction amount, and we will negotiate with each other and give preferential treatment when we trade with each other.

Since then, the exclusive and fixed minimum commission for members has become traditional and customized, which has continued and influenced future trading activities until the 20th century. The behavior of the signatories of the buttonwood agreement is also the dream goal of all market pioneers: setting up barriers to isolate themselves from others in order to achieve market monopoly; Only when it is convenient and feasible are others allowed to enter the same market.

The buttonwood agreement was also signed to prevent the government from interfering in the financial market to a certain extent.

The emergence of "bankers"

As a financial center, Wall Street established its own rules and regulations in the first two years, which laid the foundation for the development of the next two centuries. Wall Street thus gave birth to early brokers. They are not only the beneficiaries of securities trading, but also bear responsibilities and obligations.

In any case, the early Wall Street developed rapidly, and soon many important places appeared to accommodate businessmen to engage in financial activities. The first place is Tang T Hotel, which was built by Tang Ti Investment Agency, hence its name. It is not only a hotel, but also a carefully designed carrier for attracting investment. For brokers, the way of financing is not new. From selling fur to buying and selling slaves, they used to do everything. As a middleman, brokers buy goods from suppliers.

After the turbulent period of 1790- 1792, the securities trading on Wall Street stopped for nearly 20 years. 18 12 When the war against Britain broke out, the government began to raise funds by issuing a large number of bonds, and Wall Street immediately ushered in a new round of investment boom. Three major events happened after the war, which promoted the progress of Wall Street: 18 16. The second United Bank of America reopened with a registered capital of 35 million US dollars, of which 28 million US dollars was sold to the public; In order to build the Erie Canal, the first batch of bonds were issued, totaling 70 million US dollars. Set up the New York Securities and Exchange Commission.

The New York Securities and Exchange Commission, like the Union of Signatories to the buttonwood Agreement, has a membership system, but the biggest difference is that it has become an industry association, which can determine the securities prices for Wall Street with the strength and influence of several economic agents. Prime was elected as the first chairman and became a great planner of modern Wall Street.

At first, Prime accumulated wealth by buying and selling bills between banks. He became the first "banker" to use day trading and the first private banker to hold shares through a bank. The interest rate of his loan is called "prime rate". At that time, due to the influence of the Toure scandal, the securities trading industry was very depressed. Prime is an innovator. By improving traditional trading, he created a safe, secure and home-away atmosphere in his trading place.

In the following ten years, there was competition. One party claimed to be an "official" businessman and took various restrictive measures. On the other hand, outsiders, who think that securities trading is irreplaceable, challenge from time to time and gather on the road to open a "roadside market". The two sides fought again and again, inside and outside the court, which finally led to the formation of a new concept in the legal and economic fields-that is, in the free market system, freedom should be universal and not enjoyed by only a few people.

Shortly after Roosevelt was sworn in, he asked Congress to support banking legislation. First, commercial banks and savings banks are prohibited from investing in stock market securities; Secondly, establish a bank insurance fund to protect the interests of depositors. A financial institution must make a choice: whether to become an investment bank or a large customer-oriented commercial bank-a firewall is set between the two functions of the banking industry.

Regeneration of financial metropolis

1835 12 16 was originally an ordinary day, but there was a big fire at night, and the fire was so fierce that even the marble building of the business building was burned down. When the fire finally went out, there was little left of Wall Street and it was in ruins. Before the fire, there were 26 fire insurance companies in new york. After the fire, 23 of them declared bankruptcy.

Despite this, the optimism and endless vitality of Wall Street have not been destroyed. Only four days after the fire, business returned to normal. A year later, 500 new buildings have sprung up or are under construction, and a newer and better Wall Street is like a phoenix nirvana.

Some time after the fire, the New York Securities and Exchange Commission lost its residence and had to wander around and work until the new commercial exchange building was rebuilt on the original site. The new building is located between Wall Street and Exchange, Hanover Street and William Street, occupying the whole city. Isaiah Rogers, a designer, adopted the popular Greek neoclassical style at that time and erected 12 huge Ionian columns on the side facing Wall Street. Each pillar weighs 45 tons and comes from a quarry in Quincy, Massachusetts. It is cut and polished from a whole rock. It is transported south by a special raft through the river. After arriving in new york, 40 groups of cattle were transported from the port to the construction site. The rotunda of the new building can accommodate 3000 businessmen to walk back and forth at the same time and engage in various commercial and trade activities.

The office of the New York Securities and Exchange Commission is located in the Bowder Hall. Rogers has a unique idea to design it into a large commercial center, with all lighting, heating and ventilation facilities, and a huge basement as a vault with iron safes for storing all kinds of stocks, bonds and commercial bills.

The introduction of "short selling" transaction

/kloc-At the end of 0/9 and the beginning of the 20th century, many great people on Wall Street started from the roadside market and made a fortune. They innovatively created trading methods and developed many professional skills. "Uninterrupted trading" started from "roadside market". The New York Securities and Exchange Commission only trades twice a day, which is relatively rigid, while the "roadside market" is different and can be traded at any time. In this way, market transactions can adapt to the rapidly changing securities prices and become more active, and the market transaction volume is much higher than that of the Securities and Exchange Commission. In addition, in the "roadside market", experts who study certain enterprises or industries often stand in the same place every day, which has gradually become a habit. In the long run, after development and evolution, there appeared "trading seats" and "experts" with remarkable characteristics in securities trading in the 20th century.

In 1930s and 1940s, Jacob Little, the most famous trader, pushed short selling and buy more in securities trading to a new height. Short selling means selling a stock he doesn't own at a specific price and agreeing to deliver it after 30 days or 60 days. He bet that the market price will drop, and he can buy it at a price lower than the agreed price, ensuring that he will only make a profit and not lose money.

Little doesn't rely entirely on a hunch, accurate analysis of market trends or random luck, but manipulates the price of specific securities by monopolizing the market, spreading false news and using the help of others to make them close to their expected prices, so as to achieve the purpose of making profits. His most famous successful transaction was 19 in the mid-1930s. He hoarded the shares of "Morris Canal and Banking Company", and then successfully raised the share price from 10 to 185, thus making huge profits.

A little rich overnight, poor and white, has experienced at least three ups and downs in his life. Until 1857, the financial panic finally ruined him and even deprived him of the right to engage in financial transactions. According to the record of a broker who knew him, Little himself haunted the prestigious Bowder Hall like a ghost after his trading career, where he once enjoyed the treatment of a king, traded five stocks with such a small share, and he was able to have sex with the same stock.

A fragile financial system

The national economy has created a national financial system, and credit notes flow from one ocean to another without any obstacles. With the support of the government and ordinary people, Wall Street has become the manager of American capital and financial markets. Stock trading on Wall Street has become a lever to balance the national financial market. The top of this financial institution is the new agent of Wall Street-private investment bank, which completely changed the balance of power on Wall Street and became the most important force on Wall Street in the last quarter of the19th century.

The most powerful emerging investment bank is JPMorgan Chase, whose office building is located at the intersection of Wall Street and Broadway. Morgan strategically built the office building opposite the Treasury Building and the Wall Street Stock Exchange, suggesting that Morgan finally controlled the state-owned and private economic territories-just as he managed both the railway bonds of Wall Street and the government bonds of Pennsylvania Avenue. Morgan inherited the demeanor of a Victorian banker. He promoted his career with honesty, reputation and self-discipline as the core principles.

Morgan wears old-fashioned suits and shirts, gives orders from behind the big desk of Wall Street headquarters, and manages the financial empire he created, railway transportation, gold, oil and steel, which is the core of the new industrial economy in the United States-and Morgan's first choice.

However, this country ignored a warning: "It is unreasonable to build roads aimlessly with public funds." 1865- 1873, the mileage of American railways doubled; The increase in transportation capacity has led to price wars, and the transportation concessions of emerging group companies have also emerged as the times require-steel giant Carnegie and oil giant Rockefeller are Morgan's customers. The foreshadowing of the crisis is the excessive proliferation of trust mergers and acquisitions. In a few years, 3,000 companies disappeared due to the merger. At the peak of 1899, 1200 companies with a total capital of $2.27 billion were annexed by industrial trusts. The names of these trust companies were very familiar in the 20th century: Standard Oil Company, Carnegie Steel Company, United Fruit Company, National Biscuit Company and United Carbide Company.

In the United States, there is no central bank to manage the expansion of working capital, and the growth of money supply is controlled by the gold standard system that limits the expansion of money supply. This dilemma, that is, economic expansion continued and monetary expansion stagnated, finally broke out when the fig leaf of prosperity faded.

The weather vane is the accumulated national debt that cannot be paid, and the resulting second round of speculation has made the situation worse. In this way, the return on investment is like queuing, and the earnings per share are decreasing. The big buyers on Wall Street arrive first, and the investors on Central Street are always late, only cleaning up the leftovers after the insider feast, and the low income can be imagined. This pattern is repeated every time, from the first crisis of 1792 to the recent Internet bubble at the end of the 20th century.

The bubble burst was the collapse of United Copper Company, which was supported by Morgan and led by Charles Barney of the trust company. When Morgan refused Barney's help, he shot himself, and other suicides followed. Confidence in the market collapsed immediately, exposing the rather fragile foundation of this magnificent financial building. Shortly thereafter, 1907 101October 22nd, Morgan was forced to leave his beloved library and take charge of the financial rescue operation in the United States.

19071On October 22nd, George Cortelyou, the US Treasury Secretary, arranged to invest 25 million US dollars to stabilize the US financial market and calm foreign investors' worries about delayed payment. Two days later, in order to avoid the imminent domestic financial turmoil, H. Thomas, chairman of the new york Stock Exchange, visited Morgan and told him that unless Morgan took out $20 million to stop the flood of losses on Wall Street, large-scale bankruptcy of securities firms was imminent. After receiving Morgan's notice, one banker after another walked into his office. By the close of the market at three o'clock in the afternoon, he had raised $25 million to lend to brokers, thus realizing the function of the central bank as the lender's last aid.

But they didn't end the crisis immediately. During this period, depositors lined up to withdraw money from the bank, and the number of people forced the police in the city to distribute numbered banknotes to maintain order like today's bakeries. 10 year1on October 28th, the mayor of new york asked Morgan for an emergency financing of USD 30 million, which was approved. This is the fourth financial aid led by Morgan Consortium, which raised 80 million US dollars in just one week. Morgan saved the reputations of Wall Street, new york and the US Treasury in the international financial market.

Establish a "firewall"

19 13 in the year when Morgan died, the United States made two unexpected and important progress on the road of financial reform. That year, Congress established the Federal Reserve System, thus settling the argument about establishing the Bank of America. World War I turned Wall Street from a net debtor with a debt of more than $3 billion in 19 14 to a net creditor with a loan of $5 billion in19/7. In the 1920s, the bull market engulfed Wall Street, cars changed the way Americans moved, and the popularity of home and factory telephones accelerated the spread of information, so the United States seemed to embark on a road of lasting prosperity. When the bubble burst again on Thursday, 1929, 10124, Bank of America went bankrupt, which symbolically became the fuse of the Great Depression. The panic spread to the stock exchange the next day, and the wave of selling hit the stock price. The result of the stock price crash was severe deflation and the Great Depression.

Franklin roosevelt's election heralds the New Deal for ordinary Americans and a new round of regulatory constraints on Wall Street. Shortly after Roosevelt was sworn in in March, 1933, he asked Congress to support banking legislation. Its legal basis is "honesty": banks, companies and other institutions that manage or use other people's funds are trustees representing the interests of others.

Glass-steagall act (1933) provides coordinated protection for ordinary bank depositors. First, commercial banks and savings banks are prohibited from investing in stock market securities; Secondly, the establishment of bank insurance benefits to protect the interests of depositors-the Federal Deposit Insurance Corporation. A financial institution must choose whether to become an investment bank or a large commercial bank facing customers-a firewall is set between these two functions of the banking industry.

Congress passed the first law governing the Wall Street securities market-1934 Securities Exchange Law. The essence of this law is transparency. According to the executive power of the Securities and Exchange Commission and the Federal Trade Commission, it requires registration and complete information disclosure, and its existing power extends to the management of newly issued securities.

1934, Roosevelt appointed eccles as the chairman of the Federal Reserve Bank, and he worked in this position for 14 years. As a person far away from the geographical and ideological circles of Wall Street, eccles is just the person that Democrats dream of: a firm and upright banker from the northwest who reformed the Federal Reserve Bank and controlled monetary policy in a new way.

The supervision system formed in 1930s was implemented until 1980s. In this half century, the growth rate of American economy has exceeded any comparable period in history. Similarly, this is the only time in 50 years that a major or even a small financial crisis has not occurred on Wall Street.