NEW YORK STOCK EXCHANGE. Sam Herrick, Keenan Burke-Pitts, Sean Noble, Ali Albinessa, and Michael McClure

Transcription

1 NEW YORK STOCK EXCHANGE Sam Herrick, Keenan Burke-Pitts, Sean Noble, Ali Albinessa, and Michael McClure

2 AGENDA Introduction NYSE Background History of NYSE Timeline How will they grow.. Effects of current recession on NYSE

3 INTRODUCTION NYSE Euronext is a stock exchange NYSE Group Inc. and Euronext N.V. combined April 4, 2007 More than 8,000 listings Located in Lower Manhattan 11 Wall Street, New York City, NY NYSE Euronext powers the exchanging world and is comprised of equities and derivatives exchanges across the United States and Europe which trade cash equities, futures, options, fixed-income and exchangetraded products. (NYSE.com)

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5 NYSE BACKGROUND The New York Stock Exchange traces its origins to 1792 Originated when 24 brokers and merchants signed the Buttonwood Agreement Buttonwood Agreement said that they would all agree to trade securities on a commission basis This is what really is considered the first day of the NYSE

6 NYSE BACKGROUND CONT. After the war of 1812 NYSE began to grow tremendously Not only were government issued bonds being traded but so weren t stocks of banks/insurance companies On March 8, 1817, the organization drafted a constitution and renamed itself the "New York Stock & Exchange Board

7 HISTORY OF NYSE The roots of NYSE can be outlined back to the days of the revolution 1792, when 24 New York City stockbrokers and merchants signed the Buttonwood Agreement. This agreement set in motion the NYSE s unwavering commitment to investors and issuers. On March 8, 1817, the organization drafted a constitution and renamed itself the "New York Stock & Exchange Board On October 1, 1934, the NYSE registered as a national securities exchange with the U.S. Securities and Exchange Commission. The Governing Committee was the primary governing body until 1938, at which time the exchange hired its first paid president and created a 33- member board of governors. In 1971 the exchange was incorporated as a not-for-profit corporation, and in 1972 the members voted to replace the board of governors with a 25-member board of directors. That newly formed board was equipped with 12 representatives, a chairman and CEO representing public interest, and 12 representatives from the securities industry. Today, the New York Stock Exchange (NYSE) is the second largest stock exchange in the world

8 BRIEF TIMELINE Twenty-four brokers and merchants gathered on Wall Street to sign the Buttonwood Agreement. The NYSE is born! That agreement was struck by a group of 24 New York City: stockbrokers and merchants at 68 Wall Street, under a buttonwood tree Bank of New York becomes the first listed company on the NYSE April 22, the NYSE moved into 18 Broad Street. (This building is still in use today.) October 23: Black Thursday. October 26: Blue Monday (Market loses $26 billion in value.) 1939 The NYSE opens its trading floor gallery to the public NYSE admits its first woman member May 17: the NYSE celebrates its 200th anniversary April 4: NYSE and Euronext Merge, bringing together major marketplaces across Europe and the United States whose histories stretch back more than four centuries.

9 HOW THE COMPANY WILL GROW The overall goal for any company on the NYSE is to grow. A company has several ways to raise funds, but each has it s own pros and cons. Company owners can use personal funds to raise and expand the business But there is a good chance the funds will be too limited and the business expansion will be short-term. Borrowing money from banks is another popular way to expand. However it will have to repay the loan with interested immediately.

10 HOW THE COMPANY WILL GROW CONT. A company may issue a bond from investors. After investors lend the company money, the bond matures and the company has to pay each investor the amount invested plus interest. This causes a lot of repayments with interest. Another way is to raise funds by selling shares of the companies ownership called stock. If profits increase the stock-holders will share in the companies success b receiving dividend payments. This way is most effective due to its no limit on the amount of funds received. It also has no restrictions on opportunity for growth.

11 EFFECTS OF RECENT RECESSION ON NYSE Dow Jones Jones Industrial Industrial Average Average

12 EFFECTS OF RECENT RECESSION ON NYSE CONT. Since stocks are a piece of ownership in a company, the stock market reflects investors' confidence in the future earnings of all these companies. Since corporate earnings are dependent on the health of the U.S. economy, the stock market is also an indicator for the U.S. economy itself. If confidence is not restored, it could contribute further to recession, as happened in That s because declining stock values means less wealth for consumers, whose purchases drive 70% of the economy. It also means less financing for new businesses, since the sale of stocks is one way that companies can get the funds needed to grow. Last, but certainly not least, a declining stock market could eventually lead to a slowdown in the global economy. That is because the U.S. economy provides 20% of the world s output.

13 THANK YOU