Stock Market History
Studying the stock market history you will realize that the stock market has been at the centre of business operations for over 800 years. Indeed, stock market history can be traced back as far the 12th Century when French courratiers de change were charged with managine the debts of agricultural communities in France on behalf of banks.
The first known use of the term ‘bourse’ to mean a stock market is attributed to the opening of Belgian stock market in the 13th Century. That time was a particularly explosive one in stock market history, with markets also opening in Italy. Insofar as tracing the stock market history of some of today’s more famous markets, the London Stock Exchange opened for business in the early 17th Century, shortly followed by stock markets in America - including the New York Stock Exchange - in the 18th Century.
Whether the stock exchanges were opened in Europe, America, Asia or Africa, the underlying reason for stock markets is the same - as a way for entrepreneurs to raise capital. As a result, from their inception, stocks traded on stock market have been susceptible to volatile movements in stock prices.
The net result of this has meant that while most stock exchanges around the world have managed to stay in business, a brief look will show you that the overall stock market history has not been all plain sailing. Indeed, on more than one occasion, stock markets around the world have crashed, resulting in prolonged periods of economic depression.
Probably the most famous stock market crash was October 1929, when the New York Stock market crashed, taking the rest of the world’s stock markets with it. It was not until the early 1940s, and the economic boom that resulted from America’s entry into the Second World War, that New York Stock Market recovered the loss it had made in 1929.
Although the 1929 stock market crash was possible the most damaging crash on the world’s overall economy, 1929 does not hold the record for the biggest one day drop in share value. That unenviable record actually belongs to ‘Black Monday’ - October 19 1987 - when the stock market crash accounted for a 508 point drop in the stock market.
One consistent factor has, however, remained with regard to stock markets throughout the world. All stock markets appear to be extremely resilient and regardless of how bad a stock market crash is, throughout stock market history the stock market has managed to recover the losses that it made. Indeed, with the last market crash in 1987, it took less than 5 years for the market to reach new highs.
So, whatever the future holds for the history of stock markets, provided you are willing to be a long term investor, stock market history shows that a boom as well as a crash is always on its way.
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