The World’s First Stock Exchange
Lodewijk Petram
Abstract
The launch of the Dutch East India Company in 1602 initiated Amsterdam’s transformation from a regional market town into a dominant financial center. The Company introduced easily transferable shares, and within days buyers had begun to trade them. Soon the public was engaging in a variety of complex transactions, including forwards, futures, options, and bear raids, and by 1680 the techniques deployed in the Amsterdam market were as sophisticated as any we practice today. This book’s history demystifies financial instruments by linking today’s products to yesterday’s innovations, tying the ma ... More
The launch of the Dutch East India Company in 1602 initiated Amsterdam’s transformation from a regional market town into a dominant financial center. The Company introduced easily transferable shares, and within days buyers had begun to trade them. Soon the public was engaging in a variety of complex transactions, including forwards, futures, options, and bear raids, and by 1680 the techniques deployed in the Amsterdam market were as sophisticated as any we practice today. This book’s history demystifies financial instruments by linking today’s products to yesterday’s innovations, tying the market’s operation to the behavior of individuals and the workings of the world around them. Traveling back to seventeenth-century Amsterdam, the text visits the harbor and other places where merchants met to strike deals. It bears witness to the goings-on at a notary’s office and sits in on the consequential proceedings of a courtroom. It describes in detail the main players, investors, shady characters, speculators, and domestic servants and other ordinary folk, who all played a role in the development of the market and its crises. This history clarifies concerns that investors still struggle with today, such as fraud, the value of information, trust and the place of honor, managing diverging expectations, and balancing risk.
Keywords:
fraud,
Dutch East India Company,
Amsterdam,
honor,
investors,
risk,
financial instruments,
merchants
Bibliographic Information
| Print publication date: 2014 |
Print ISBN-13: 9780231163781 |
| Published to Columbia Scholarship Online: November 2015 |
DOI:10.7312/columbia/9780231163781.001.0001 |
