It appears that confusion may surround what is meant by “Wall Street.” Do we mean a smallish street running eastwards from Broadway to South Street in lower Manhattan? Are we talking about the biggest brokers left standing? A movie?
You ask a good question, and it’s one whose answer has changed over time. You see, in the early days of capital markets formation in the United States, traders did business primarily in New York and Philadelphia, while Boston concerned itself with shipping and banking. In 1792, twenty-four traders (yes, all men), standing under a buttonwood tree at what is now 68 Wall Street, entered into the Buttonwood Agreement. That agreement which formalized their business association and established more formalized trading is seen as a precursor to the New York Stock Exchange.
By the mid-1830s, New York had eclipsed Philadelphia as the center stage for the country’s financial market, and “Wall Street” evoked the New York securities market. The term expanded after the Civil War to denote the total American securities market. By the turn of the century, “Wall Street” more broadly represented American economic power. Today, “Wall Street” can be shorthand to mean the financial services industry, that itself underpins global capital market relationships. The term is also often used to juxtapose big business concerns with those of the individuals and small businesses of “Main Street.”
Be careful when evaluating statistics regarding “Wall Street” or the financial services industry because ambiguity remains. Is the insurance sector included? How about credit agencies and mortgage brokers? The Government Accounting Office included them in its May 2010 Report on Diversity in the Financial Services Industry. Like anything else, it’s important to read the fine print.
Hope that helps. By the way, you should have seen what Wall Street (the road, I mean) was like back in the 17th century when it was being laid out along the path of the old wooden stockade meant to protect the Dutch settlers. What a mess!
P.S.- If you’d like to read more about Wall Street’s history, you might enjoy these books that I also peek at when my memory gets spotty:
Geisst, Charles R. Wall Street: A History. New York: Oxford University Press, 1977.
Gordon, John Steele. The Great Game: The Emergence of Wall Street as a World Power 1653-2000. New York: Scribner, 1999.
This post was originally published Sept. 29, 2010 on Pettistripes, my blog that explores topics of women and finance-past, present, and future. Check out more by following on Facebook and Twitter or at its site!
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