stock exchange

The New York Stock Exchange in 1929, where panic-selling of shares after a prolonged period of speculation brought about a worldwide economic crisis. It shook the confidence of US consumers and investors. People stopped spending, and the lack of demand and investment meant that millions lost their jobs during the Depression that followed.

Institution for the buying and selling of stock in publicly held corporations. An exchange trades in stocks that are already issued. Trading is done only by members who have purchased or inherited a ‘seat’ on the exchange. They can act as brokers for nonmembers, on a commission basis, or as floor brokers, acting for other members. Registered traders have no contact with the public but trade only their private accounts. The world's largest exchanges are in New York (Wall Street), London, and Tokyo, and stock prices are watched carefully as indicators of confidence in the economy.