The New York Stock Exchange is the largest stock market in the world. Approximately 2,300 companies belong to this market in which over 6 billion shares of stock are traded every day. In 1792, the NYSE was formed on Wall Street, in New York City, as an all-day auction for stocks. Stocks are shares or partnerships in a business or a company. The company sells the stock to gain capital on which to operate. The purchasers of the stock become part owners of the company and receive money when the stock price rises. A stock market is a place where stock can be traded, bought, or sold. The former chairman and CEO of the NYSE explains how the stock market works. Brokers and specialists buy and sell stocks for individuals, their companies, and the businesses that are members of the exchange. The New York Stock Exchange is a part of the American free enterprise system, and is expanding to cooperate with international stock exchanges.
The investment professionals who work on the floor of the NYSE receive commissions from the people for whom they work, on the money they invest for them. An independent broker is not part of any major brokerage company. A house broker works for one of the major brokerage companies and represents the clients of that company. A specialist is an agent who represents the companies that are members of the exchange and executes orders for these companies. A governor helps control the market by preventing reaction to new events, overselling, and misinformation.
Standards
- ECON-2 The student will demonstrate an understanding of how markets facilitate exchange and how market regulation costs both consumers and producers.
- Markets arise in order to allow people and institutions to trade items of value for something else of value. Markets are efficient when they are unrestricted. The prices in a market send signals and provide incentives to buyers and sellers. To underst...
- ECON-2.1 Illustrate how markets are created when voluntary exchanges occur between buyers and sellers.
- ECON-2.2 Explain how efficient markets allocate goods, services, and the factors of production in a market-based economy.
- ECON-2.3 Illustrate how competition among sellers lowers costs and prices.
- ECON-2.4 Illustrate how an economically efficient market allocates goods and services to the buyers who are willing to pay for them.
- ECON-2.5 Explain how business cycles, market conditions, government policies, and inequalities affect the living standards of individuals and other economic entities.
- ECON-2.6 Explain how market power enables some market structures to affect their situations to varying degrees and to use this market power to increase prices and reduce output.
- Markets arise in order to allow people and institutions to trade items of value for something else of value. Markets are efficient when they are unrestricted. The prices in a market send signals and provide incentives to buyers and sellers. To underst...
- EPF.3.ER Apply the laws of supply and demand to determine how changes in market conditions affect prices.
- EPF.3.IN Compare and contrast how the organization of various market structures affects decisions and outcomes of individuals and firms.
