Stock Research

Two generations of the Soviet citizens did not know a word “stock exchange”. But all falls back into place. By 90-th years of XX century centralized national economy has deadlocked: commodity deficiency has swept away all from counters of shops, the hidden inflation and surplus of monetary weight have led to appearance of barter in the economy, to disorder of economic communications, recession of industrial production. It is the incomplete list of those problems that were preconditions for a new economic reform in Russia when in the beginning of 1990th years transition to market economy has begun. Then after sixty years’ of calm in Russia again there were stock exchanges which always were one of the major elements of the market. The stock exchange again became necessary.
These years in Russia the exchange boom begins. In the beginning of 1990 in Moscow there are first commodity exchanges - Russian commodity-raw (RCRE) and the Moscow commodity exchange (MCE) - the centers of marketing of those years on which then it was necessary up to half of all wholesale exchange turn of Russia. President of RCRE Konstantin Borovoj in the book “the Price of freedom” recollects, how then nobody trusted, that in Russia stock exchanges can revive. “One of my friends, - he writes, - which I torture most of all in occasion of an opportunity of opening of a stock exchange, has suggested to pay to me of ten thousand dollars that I have stopped these conversations and vanity…”. Really, all began with naked enthusiasm. Some person have simply gathered, risked to enclose in new business the of 30 thousand rubles.
In the beginning of 1990th years stock exchanges have arisen on all territory of the country. In a course there was a wood, sugar, electronics, a paper, building materials, bread, cars, computers and set of other goods. Soon Russia was beat out in world leaders by quantity of stock exchanges - them was totaled more than 1000. Certainly, the majority of them were not classical exchange structures. Many of stock exchanges as a matter of fact were simply fairs where traded in the real goods. But the role of a stimulator of trade and they have played wholly. People began to forget about so hated deficiency of the food and industrial goods.
These for the present not all clear quasi-exchange organizations – harbingers of something new - found to themselves a haven in any premises which could be rented for a while. To many budgetary organizations which are often not received the salary in time, it was necessary “to sin” with letting of rent of its space. Where only did not lodge new sprouts of market economy! Their neighbors were workers of research institutes, publishing houses, the ministries, factories; they removed premises on All-Union Exhibition of Achievements of National Economy (VDNKh), private apartments.

The first term transactions began to be made. On the Moscow commodity exchange (MCE) for the first time in the country transactions for the term with grain and a clap began to be spent. Hardly later to it the Moscow chamber of commerce (MCC) where the future for US dollar bargained joins.
Gradually this trade starts to get the organized character. Classical exchange platforms on which trade basically in financial actives (currency, securities, credits) crystallize. In due course in exchange movement all starts to sound a theme of the share market more clearly. By the end of 1992, according to the Ministry of Finance of the Russian Federation, the quantity of exchange share platforms has reached 22. On the largest commodity exchanges there are share departments. In 1992 the Moscow interbank currency stock exchange (MICSE) which all over again became the center of the organized trade in currency, and then was established by the main stock exchange of the country. 

With the beginning of process of privatization in 1993 in Moscow has opened Moscow international share (MISE) and Moscow central share stock exchanges (MCSSE). The Leningrad stock exchange is established. Trade in securities was started by the Siberian, Baltic and Nizhniy Novgorod stock exchanges. First time stock exchanges were often open for everything, with the right of paid participation of the visitors, not being members of a stock exchange. Usual auction sometimes practiced.
The classical share market that time yet was not. Stock exchanges should struggle for a survival. The majority of commodity exchanges began to trade in 1993 in nationally known vouchers (certificates on privatization), credits and monetary resources, broker places, securities for bearers, and also substitutes of securities. To such notorious tickets MMM, for example, concerned.
After more than semicentennial investment hibernation people again have become interested in securities. There was a hope to earn additionally: many have rushed to put the savings thawing from inflation in securities. It was necessary to something to prove nobody, all as though waited, when, at last, there will be such opportunity. But the market was young. It ill equipped participants was waited with “reefs” of share games: unscrupulous businessmen with financial “pyramids”, sharp loss of savings, it is frequent the last. As a result has come disappointment, and more likely, mistrust of the population to any securities.

 
The same years develops the exchange market for wholesale trade in currency. The center of interbank trade in a foreign currency became the Moscow Interbank Stock Exchange, founded by Bank of Russia and leading commercial banks. In 1992-1993 regional currency stock exchanges in the key economic centers of the country are created. Their network was stretched from St.-Petersburg up to Vladivostok. A creation of the national market on trade in currency and securities on a united technological basis was possible after their unification around of the Moscow Interbank Stock Exchange.
Having received the license of Bank of Russia for the organization of operations of sale and purchase of a foreign currency, these stock exchanges gradually became universal exchange structures which, leaning on local banks, carried out trading and settlement operations, and also carried out functions of storage and the account of the rights to securities for participants of currency, share and term segments of the financial market.
Trade in the state short-term bonds, the state currency and municipal bonds, has begun. In the market the corporate securities emitted by the first private enterprises have started to address.
Revival of exchange trade in Russia has coincided on time with mass introduction in the financial world of information technologies, distribution of the Internet. Though the largest stock exchanges of the West continued to trade in classical way - “by vote on pit”, on a number of the Russian stock exchanges the integrated electronic systems for the organization of the trades began to take root. For the Russia which have stretched on nine time zones, it also was complex, as well as it is necessary. The first large project in this area became creation in 1993 on the basis of the Moscow Interbank Stock Exchange electronic trading-depositary systems which served the market of the state securities (state credit obligations-federal loan bonds).
In May, 1993 the Moscow Interbank Stock Exchange has opened the exchange market state short-term zero-coupon bonds (state credit obligations). In the end of this year it has started the project of united electronic financial market “ETHER” - the inter-regional exchange trades in system of currency stock exchanges have begun. Since 1994 the Moscow Interbank Stock Exchange has entered new technical and trading-depository complex, and with July 1994 has begun distribution of the removed terminals connected to trading-depository system of the Moscow Interbank Stock Exchange.
Its beginning was such. As a result in Russia there was the exchange platform possessing modern electronic trading system, serious potential of development and supporting an increasing securities market - state credit obligations, federal loan bond, then corporate securities and term tools. Then the trades by currency also are translated in system of the electronic trades (SELT). Introduction of the removed terminals enabled to create a universal computer stock exchange where in a mode of real time worked not only the Moscow investors, but also participants from other regions of the country.
In 1994 the Central republican universal stock exchange (CRSE) in Moscow starts to work. It has been opened for fulfillment of transactions by general public, including private persons. On it traded approximately in 50 kinds of demand securities and substitutes which most part then has completely disappeared from the reference. The share market then experienced illness of growth - the reference of pseudo-actives - substitutes of securities. The most popular were tickets MMM by means of which notorious adventurer-mathematician Sergey Mavrodi has constructed a huge pyramid. During its promotion mass advertising promised incomes up to 1000% annual, to resist what the most proof investors could not even. In annual report CRSE for 1994 it is possible to read through the interesting lines describing tickets МММ: “Behind tickets МММ definition “polytrophic production МММ” has strongly affirmed. However during long time they were the most popular paper. Occurrence of tickets of different face values, constant change by management of МММ of appearance of tickets, frequent refusals to accept for payment own releases of tickets, feverish throws of a rate of their buying up-sale in items МММ - all this has resulted work in the market of tickets in the category of the most brave, but also… the most profitable operations. Tickets МММ were the largest component in turn CRSE and gave those years approximately 40-50% of a turn of all stock exchanges of Russia. But unjustified incomes and poor papers have a short life: in 1994 the pyramid has failed, having left millions investors without means and for a long time having scared away investors from the share market.
In 1995 there has begun the activity the Russian trading system (RTS) on which stocks of the first privatized Russian enterprises bargained. On a plan of its founders, it was anything other, as computer over-the-counter system. Similar RTS can be named American computer market NASDAQ. The basic participants of RTS became brokers - members of National association of participants of the share market (NAPSM). Activity of RTS which has been constructed in view of the international standards, has allowed returning trust to the organized securities market. However its weak places were absence of guarantees of execution of transactions, and also orientation to service of the large broker companies with foreign participation. Nevertheless till 1998 on RTS consist more than half of transactions with the Russian stocks.
One of the last in 1990th years had been created the Moscow stock exchange (MSE). In the beginning of 1997 several tens of banks and the broker-dealer companies, and also four stock exchanges have created MSE. However its activity was limited to trade in stocks of the gas giant - Russian Open Society “Gazprom” and the Moscow municipal loans. Attempts to expand a spectrum of operations due to introduction in a turn of other share values and currency have not gone right.
Thus, rough process of formation of exchange structure of the financial market in Russia, predictably, crystallized in several classical stock exchanges. The interesting certificate of the middle of 1993 the newspaper has left to us “Exchange sheets” in which president of MCSE V. Pankin wrote: “The main thing during the last period consists in that in any measure to adjust the destroyed intereconomic communications. There was a process of transformation of many stock exchanges in associations, trading houses, the investment companies and so forth Commodity and raw stock exchanges send to future contracts on that goods which all over the world are considered exchange. As to stock exchanges now there was ten and a half. In the long term them will be even less - two-rub Moscow besides it is probable, in St.-Petersburg, in Ural, the Siberian, Far East regions “.
Rough exchange decade has yielded the fruits. There was a precise exchange system across all Russia, in central and industrial regions of the state, helping to work to the domestic financial market.

Joint-Stock Company “Siberian stock exchange” was founded on February, 22nd, 1991. The first name of a stock exchange was Joint-Stock Company “Siberian stock exchange” (SSE). Till July, 1997 of Joint-Stock Company “SSE” carried out functions of the organizer of the trades in the share market. Since 1994 the stock exchange actively was engaged in the organization in Siberia the future market on the currency, the average price of state credit obligations and for the Index of RTS. In 1997 in connection with change of the legislation of Joint-Stock Company “SSE” has stopped activity of stock exchange. In 2002 shareholders have changed the name to Joint-Stock Company “Siberian exchange”. On July, 16th, 2002 the stock exchange has received the license of a commodity exchange №128 and since April, 16th 2003 has started the trades by standard (future) contracts on soft food wheat 3 classes with fibrin not below 23%.
Since September, 26th 2005 at an exchange the trades on future contracts on gold.
The Basis of the future market of a stock exchange have begun is the Settlement union - association of the Settlement firms which have concluded the multilateral Contract about the organization of the future market among themselves and a stock exchange. Settlement firms are shareholders (members) of a stock exchange and have the right to serve the clients trading in the future market. Among them are large manufacturers and converters of grains, the trading and financial organizations.
The Siberian exchange in the development aspires to construction of a classical commodity-future exchange - unique financial institutions by the opportunities which provides fair pricing, insurance and regulation of financial risks for the basic participants of the grain market of Siberia. The stock exchange will promote also to improvement of an investment climate and increase of efficiency of agricultural branch of South-Siberian region - one of leaders of agrarian Russia.

Despite of short enough history, the Czech share market developed rather dynamically and it was generated with all necessary attributes in the end of 19 centuries. Necessities of an internal exchange and its growth have served development of fairs. At first they had just local and speculative character.
Grain, cattle, horses marketed mainly on them. First time trade occurred at “Horse fair” (Konsky trh), and since 1882 on Senov square. The first commodity exchange has appeared in Prague in 1861 (”Produktenhalle”), but because of a small amount of participants the stock exchange has stopped the existence in a year.
Following attempt of formation of a stock exchange in 1871 has led to long-term success. Motivation has served the application made by influential people of the Prague economic elite led by Alois Oliva he was the wholesale dealer of sugar. Owing to its application financial resources for creation and functioning of a stock exchange have been received. At this stock exchange circulated both securities, and the goods (grain and other agricultural products). At a stock exchange trade of sugar was successfully enough spent. Prague during this period, perhaps, was the basic shopping center within the borders of Austro-Hungarian Empire. Nevertheless, after the First World War the goods have stopped to circulate at a stock exchange.
The Second World War has stroked the hardest blow on a financial condition both the country, and a stock exchange as a whole. The stock exchange has stopped the existence up to 1990. In May, 1990 the Preliminary committee on the organization of the Prague stock exchange has been created. 24 august of 1993 the company consisting of 8 chambers of commerce, has been transformed to association. In connection with the acceptance of the certificate “About stock exchanges” the association has been reorganized in the Prague stock exchange.
For short enough term the stock exchange has been automated, on April, 6th, 1993 the beginnings to function. With transitive economy the model of independent agency for the control over the share market is peculiar to all countries. In April, 1998 in Czech supervising functions send from the Ministry of Finance to the independent commission under securities. On June, 14th, 2001 the Prague stock exchange became a member of Federation of the European stock exchanges.

Channel Islands Stock exchange (CISX/Exchange) has begun the activity in 1998 and renders services under the admission of securities to the trades (listing), and also on over-the-counter trading of securities. CISX/Exchange developed the accelerated rates, and for December, 31st, 2004 its market capitalization has made 28 billion US dollars.
For May, 31st, 2005 800 companies have passed procedure of listing. CISX/Exchange offers an individual approach and fast process of processing of applications on the admission of securities on the innovative and highly controllable market. CISX/Exchange specializes on following services:
- services of experts on carrying out of operations with securities (including the Eurobonds, the structured duty and guarantees);
- investment funds;
- primary and secondary listing of securities and the actions emitted by the companies of Channel Islands and the foreign companies;
- depositary receipts which are given out by Channel Islands.
CISX/Exchange has the site in the Internet where the detailed review of sponsors of listing and the securities quoted at a stock exchange is given. The market information and quotations of the prices, is published worldwide on the pages of agency Reuters devoted to the CISX/Exchange.
CISX/Exchange has a favorable mode of listing of those securities in which the limited number of the investors (well understanding questions of investments) trades.
With the introduction in July of the Instruction of EU on Market Frauds, heightened interest to the securities which are quoted on CISX/Exchange as Channel Islands are not a part of EU so, CISX/Exchange is not the market adjustable by the given Instruction is observed.
CISX/Exchange has competitive prices, an effective turn of documents with the purpose of consideration of applications within 48 hours, and also keeps work with emitters and sponsors of listing on a flexible and commercial basis. The similar attitude is reflected in all aspects of listing from requirements about disclosing the information before accommodation of methods of introduction of innovative structures.
Though CISX/Exchange is situated at the territory of the Europe, and time of carrying out of its trades coincides with London time, it is not adjusted EU.
CISX/Exchange has a plenty of official international recognitions, for example:
• It is adjusted by the Commission on granting Financial Services of Guernsey which is the participant of the International Organization of the Commissions under securities;
• Is the recognized stock exchange according to section 841 of the Law on the income and corporate tax of the United Kingdom from 1988, hence, the debt securities quoted on CISX/Exchange, can be considered as quoted Eurobonds for the purposes of the taxation in the United Kingdom, percent on which are paid up to a deduction of taxes;
• Management of Financial Services of the United Kingdom has approved activity CISX/Exchange as an investment stock exchange within the limits of the Law on Financial Services and the Markets from 2000;
• CISX/Exchange is a related member of the International Organization of the Commissions under securities;
• The stock exchange is recognized by the Commission under securities and stock exchanges of the USA as an offshore securities market according to the Rule 902 (c) of the Law on securities of 1933;
• It is officially recognized by the Australian Stock exchange;
• CISX/Exchange is registered in the World Federation on Stock exchanges as “the market which is meeting the requirements”;
• The stock exchange is a member of the European Forum on maintenance and financing of securities.
Applications on reception of the quotation on CISX/Exchange move through the sponsor who is the member of CISX. The given stock exchange provides accelerated “the equivalent approach” to process of applications on reception of the quotation of securities. It means that by consideration of the similar application documents on reception of the listing, prepared for jurisdiction or the stock exchange recognized CISX/Exchange provided that the information containing in documents of a similar sort, essentially did not change can be used. Process of applications on reception of the quotation has four stages.
1. The sponsor and the emitter prepare and hand over the initial application, including the project of the document on reception of the quotation. CISX/Exchange usually loyally approaches to consideration of documents if requirements about disclosing a special sort of the information are not observed owing to presence of circumstances from the emitter. For submission of applications on secondary listing already available documents on reception of the quotation in the primary market can be used. At the given stage all corresponding projects of powers of attorney on management of the property and other financial tools serving by maintenance of debt securities, or components of those also are a subject to check.
2. Check of applications (usually within 48 hours) is spent, and then the sponsor at the coordination with the emitter gives answers on emerged questions.
3. The sponsor submits a final variant of the application which considers Management of the Share Market.
4. After reception of approval of Management of the Share Market documents on reception of listing are registered, and securities are brought in the official list of quotations of a stock exchange. The official information of listing are published in the form of the official application, and process of fulfillment of the trades and commercial transactions begins.
To pass all four stages from the initial application before reception of listing it is possible for 10 days, though CISX/Exchange can accelerate this process, proceeding from commercial reasons.
The sponsor of listing promotes the emitter in preparation of all documents, submits them in CISX/Exchange and keeps in contact with CISX/Exchange concerning any inquiries which can act in connection with process of reception of the quotation.
A necessary condition for reception of listing is that the emitter carries out the obligations according to Rules of listing and other duties concerning given procedure. Besides observance of special Rules of listing, the emitter is obliged to inform the public, CISX/Exchange and holders of securities of the company on occurrence of any important data concerning the emitter, allowing the public and owners of securities correctly define a financial position of the emitter, to avoid creation of a false securities market, and also possible negative influence on activity of the market and cost of securities.
The further requirements include granting CISX/Exchange of spears of annual reports, audit or other financial reports of the emitter, and also disclosing CISX/Exchange of the information on any changes of the rights provided by debt securities of the emitter, quoted on a stock exchange. Emitters should hand over copies of the announcements containing the information on debt securities, included in listing, for check by Channel Islands Stock exchange before their publication.

I have written this blog for 1.5 month, but only several days ago I realize that I wrote about different foreign stock exchanges, but I’ve forgotten to write about the unique stock of my own country… About Belarusian Currency and Stock Exchange… And today I’ll try to correct it!
The portrait of open joint-stock company “Belarus currency-stock exchange”
The open joint-stock company “Belarus currency-stock exchange” has been formed in 1998 in accordance with the Decree of the President of Belarus from July, 20th, 1998 №366 “About perfection of system of state regulation of the stock market”. Founders of a stock exchange became National bank of the Republic of Belarus (a control share holding), Fund of the state property of the Ministry of Economics of the Republic of Belarus and a number of large banks of the Republic of Belarus.
The supreme body of management of open joint-stock company “Belarus currency-stock exchange” is General meeting of shareholders. The structure of shareholders of a stock exchange, except for founders includes banks, the broker/dealer subsidiaries of republic, etc. The Management of a stock exchange between the General meetings of shareholders is carried out by the Supervisory council.
As of today of open joint-stock company “Belarus currency-stock exchange” is the unique in republic trading platform on the basis of which the national system of the exchange trades on all basic segments of the financial market is created: currency, share and term. Except for the organization of the trades, the stock exchange carries out functions of the settlement depositary institution in the exchange market of not state securities, function of the operator of settlement-clearing system by all kinds of securities and tools of the term market, and also carries out registration of the transactions concluded on the over-the-counter market with stocks of open joint-stock companies and voucher “Housing”.
The foreign exchange market.
According to the Rules of exchange trade in the foreign currencies approved by the decision of Board of National bank of the Republic of Belarus 28/06/2001 №165 (read with 31/10/2003), open joint-stock company “Belarus currency-stock exchange” it is allocated by the right of the organization of the trades by a foreign currency.
The trades by a foreign currency at a stock exchange are carried out within the limits of Section of the currency market. The exchange trades are spent daily with use of electronic system of the trades. The cores currencies quoted at a stock exchange are: US dollar, Euro, the Russian ruble and the Ukrainian hryvna. The rates generated on results of the exchange trades, today are included into the category of the basic indicators of the currency market. On results of the trades the National bank of the Republic of Belarus establishes official rates of the Belarus ruble in relation to US dollar and ruble of the Russian Federation.
The total volume of the trades by all kinds of currencies for 9 months of 2005 was made 10.6 billion of rubles or 4 912 million US dollars in an equivalent.
Stock market.
According to the legislation of the Republic of Belarus for many securities the stock exchange is a unique admissible jail of transactions. To such papers concern: the state issue securities, bonds of National bank of the Republic of Belarus, the bond of local loans and the securities of the open joint-stock companies last an estimation of quality and reliability (listing) and admitted to the reference at a stock exchange. To participation in the trades by securities members of Section of the share market are supposed only. Transactions with securities are made in universal electronic trading system. The opportunity to participate in the trades with use of the automated workplaces located in trading halls of a stock exchange, or through the removed trading terminals is given to members of Section of the share market. The trades by securities are spent daily in following modes: “Continuous double auction”, “REPO (the fixed pricing)”, “REPO (free pricing)”, “Discrete auction”, “Forward transactions”, “Simple auction”, “Simple auction REPO”. The given modes are effectively used for primary accommodation of securities, the organization of their secondary reference and maintenance of processes of privatization.
Now in sector of the state securities and securities of National bank auctions of the Ministry of Finance on accommodation of the state securities are spent, within the limits of the secondary reference transactions in modes “continuous double auction” and “REPO” are made, the National bank of the Republic of Belarus on a regular basis spends simple auctions REPO. On the given segment of the market the institute a market-makers functions. Since September, 1st, 2005 the index on the market government securities/short-term bonds of the National bank of the Republic of Belarus pays off and published.
In sector of not state securities transactions with stocks and bonds of subjects of managing are made at primary accommodation and the secondary reference, and also privatization transactions. The fund of the state property of the Ministry of Economics of the Republic of Belarus uses exchange technologies for the organization of auctions on sale of actions belonging to the state for a foreign currency and the Belarus rubles, “discrete auction” and other accessible modes of the trades realizes state blocks of shares of stocks in a mode. Since October, 7th of 2005 in sector of not state securities the regular trades by bonds of banks have begun.
Participants of the trades can make transactions with not state securities with following conditions of calculations: T+0 (delivery of money and securities in day of fulfillment of the transaction), T+n (delivery of money and securities in the day certain by participants during the moment of fulfillment of the transaction), and also the transactions made on conditions REPO.
The total volume of the exchange trades by securities of all kinds for 9 months of 2005 has made 7.0 billion of rubles, or 3.2 billion of US dollars.
According to the legislation of the Republic of Belarus the stock exchange carries out obligatory registration of all accomplished on the over-the-counter market of transactions with securities of the open joint-stock companies, and also since January, 25th, 2005 transactions with nominal privatization checks “Housing”. For nine months of 2005 by a stock exchange it has been registered 1066 over-the-counter transactions with stocks of open joint-stock company for a total sum of 15.96 billion rubles (7.4 million of US dollars) and 33653 transactions with  voucher “Housing” at actual cost of 19083,7 million rubles (on a face-value 24.0 million rubles). For service of processes of registration system BEQAS functioning on the basis of the Internet-technologies is used.
The term market.
Since October, 2004 the stock exchange has started trading by financial tools of the term market on a constant basis. The exchange trades by tools of the term market are spent in electronic trading system every working day simultaneously on all tools in a mode “continuous double auction”. As participants of the trades act the members of Section of the term market. Calculations under made transactions are spent in uniform settlement-clearing system, in which function of a clearing bank carries out National bank of the Republic of Belarus, and function of clearing - a stock exchange. The toolkit of the given market is presented by future contracts on rates of foreign currencies and interest rates in the market of the state securities.
Information work.
The major principle of the organization of activity of a stock exchange is development of information technologies and increase of a transparency of the financial market of republic. With a view of realization of the given principle by a stock exchange it is created and successfully functions three basic automated information products: the official Internet-site of a stock exchange, the Belarusian automated quoted system of a stock exchange (BEQAS), Information system “Stock market”. The official Internet-site of open joint-stock company “Belarus currency-stock exchange” is the central element of system of disclosing of the information by results of activity of a stock exchange in the currency, share and term markets.
“The Share market” accumulates data about a condition and the processes occurring on a republican securities market. The basic suppliers of the information are open joint-stock company “Belarus currency-stock exchange”, Committee under securities at Ministerial council, National bank, the Ministry of Economics and the Ministry of Finance. Except for the data, directly concerning the stock market, in system the information on a condition of the currency and monetary market is concentrated; contain actual financial and social and economic news of Belarus, the CIS countries and the world.
BEQAS is the information-quoted system functioning on the basis of the Internet-technologies, intended for search of the counterpart for fulfillment of transactions with various kinds of securities, and also serving processes of obligatory registration in the unorganized market of transactions with stocks of the open joint-stock companies and the nominal privatization checks “Housing” accomplished on the over-the-counter market. For today the system is the only thing in republic a high-grade source of the information on a condition the over-the-counter market of the Belarusian enterprises.
Besides the stock exchange acts as the supplier of the information for republican news agencies, and also the leading mass-media focused on illumination of world economic processes.

History of the Frankfurt stock exchange begins with the occurrence of medieval fairs. In the middle of 9 centuries king the Louis has given the preferable right to Frankfurt to spend annual autumn fairs. With 1330 when king the Louis IV Bavarian has expanded advantage and has resolved annual spring fairs, the city became the major center of trading and monetary operations.
Already in the beginning of 16 century, owing to the well-known fairs, Frankfurt becomes so prospering, that German monk Martin Luther names city “a silver and gold chink” of German empire.
As a result of flight to Frankfurt of Dutch and French dealers hided from prosecution because of their Protestant belief, in 16 century mass trade and bank sector are established in Frankfurt. Merchants from all parts of the Europe came to Frankfurt to borrow in trade.
Because of that neither in the Europe, nor in the German empire there was no uniform currency, the various countries have been shattered into numerous small economic regions, in each of which there was a monetary unit, realization of payments was the extremely difficult. Abundance of means of the payment, the unregulated exchange rate promoted development of swindle and usury. In 1585 the Frankfurt merchants have agreed about use of the fixed exchange rates of various monetary units. This date is considered the moment of a birth of the Frankfurt stock exchange. With 1585 during each fair the group of merchants periodically gathered for updating uniform and obligatory exchange rates of various monetary units. The first official list of exchange rates has appeared in 1625 the oldest list of exchange rates of the Frankfurt stock exchange, kept up to now, concerns to 1721.
First meetings of merchants were spent on the area in front of the Frankfurt town hall. And only in 1694/1695 there was a first building of a stock exchange in Frankfurt (Großer Braunfels) - the most significant and spacious building of city.
In 1682 have been put into operation the first necessary rules and norms of a stock exchange, the organizational structure of the Frankfurt stock exchange has been generated.
Down to the end of 18 centuries at a stock exchange traded exclusively in coins and bills. Only in the end 18 century begin periodic trade in bonds.
In 1707 at the next assembly the management of a stock exchange has officially approved trading agents - representatives of merchants. In 1808 the Chamber of commerce has been organized. The Frankfurt stock exchange created approximately 223 years ago as private association of businessmen, has turned to public establishment, already in first half of 19 centuries having passed in submission of the Chamber of commerce.
In the middle of 19 centuries the new prestigious building of a stock exchange under the project of the known architect in Frankfurt Friedrich Peiper, located near church St Paul’s Church has been constructed, it was opened in 1843.
Industrial revolution in Germany favored to development of financing of expensive projects through issue of stocks. The first quotation of the stocks is dated 1820 though as a whole the basic place of trade in 19 century was borrowed exclusively with bonds. In comparison with the largest European stock exchanges, the Frankfurt stock exchange treated coldly enough trade in stocks of numerous known corporations. In 1850 the Frankfurt stock exchange was generated as the center of trade mainly by the state bonds and the state interest bearing securities.
The new building of the Frankfurt stock exchange has been arisen in 1879. Construction has been carried out under projects of known architects of Frankfurt - Heinrich Burnitz and Oskar Sommer. Perhaps, this construction was the most successful - functionality of a stock exchange was perfectly combined with its prestige. Besides a new building of the Frankfurt stock exchange.
After unification of Germany in 1871 the Berlin stock exchange began to play the central role in the share market. It became the center of trade of the period when only in Prussia for the period with 1870 on 1974 there were 857 joint-stock companies. And by the end of a century in the country already 29 stock exchanges operated. Despite of it Frankfurt had an opportunity to defend the rights as the center of exchange trade.
In the end of 19 centuries for Frankfurt there was an absolute necessity of adaptation to a general economic situation in the country. With the purpose to keep the prestige of economic capital Frankfurt has changed the policy and has increased trade in stocks. This aspiration of Frankfurt to creation of the present stock exchange has collided with prevalence of the Berlin stock exchange.
The First World War and its consequences have delivered the hardest blow on the Frankfurt stock exchange. Foreign stocks and bonds were sold out to German investors because of fear of aggression from the oppositional states, free money resources were put only in the state bonds. By the end of war all foreign securities have disappeared from German quoted lists, as a result of it Frankfurt has lost the status of the international stock exchange. By the end of war all the international contacts of the Frankfurt stock exchange have been broken off and began to be restored only in 20th years. The short period of stability and well-being was replaced in 1929 by crisis. Economic crisis was and earlier. Same it has appeared unique on depth of falling of manufacture, on scales of scope of economic and on duration. The reason for that is in frustration of economic after the First World War. Fragile was a German economy. In 1931 German stock exchanges have been compelled to stop the functioning temporarily.
Fascist movement has arisen in Germany after the First World War. The German fascism differed extreme nationalism and racism. Fast growth of fascism fell to years of an economic crisis. The economy has been transformed. The state began to adjust it to accelerate an output from crisis and to create a powerful war industry. It has established the control over the prices, wages, has subordinated businessmen to the state bodies. Fascists aspired to establish the control over stock exchanges of some the states. The Frankfurt stock exchange in 1935 has merged with Mannheim Stock Exchange, then having absorbed Rhine - Main Stock Exchange. Frankfurt stock exchange, functioning as “an internal stock exchange”, in essence was not of great importance and did not carry out the major functions. The Nazi economic policy braked development of the free share market.
In 1944 has begun the final stage of the Second World War. The building of the Frankfurt stock exchange has been strongly damaged during an air strike. Meetings of stockbrokers now could be spent only in cellars of a building. After crash of a fascist mode in 1945 the Frankfurt stock exchange remained closed. However in September, 1945 the Frankfurt stock exchange, first of the German stock exchanges, has opened again.
As a result of currency reform 1948 and growing strengthening of the German economy the Frankfurt stock exchange gradually has found the former importance and played the leading part in Germany. After lead in 1992 the Frankfurt stock exchange became connected by reorganization directly not with Commercial and industrial chamber, and with joint-stock company the German stock exchange.
The German stock exchange represents joint-stock company, 81 % of actions belong to banks, 10 % - to regional stock exchanges, 9 % - to brokers. The German stock exchange runs the Frankfurt stock exchange and the German stock exchange of urgent contracts - Eurex. To this joint-stock company belong and are its branches the depositary-clearing system, information system and the Society of assistance to development of stock exchanges in Central and the East Europe.
In May 2000 there was a sensational merge of the London stock exchange to German stock exchange, to formation of a new interethnic stock exchange iX. A trading platform of a new stock exchange became German computer system XETRA. Incorporated stock exchange International Exchanges, or iX, becomes the largest share market in the Europe and serious counterbalance to Wall-Street.

Today I’d like to finish the story about Saint-Petersburg Stock exchange…
Kinds of the securities presented at the Saint-Petersburg Stock exchange.
The Share market has been presented in 1830 by:
- the state and city bonded loans which shared on short-term (till 1 year), long-term and termless (the original rent)
- continuously profitable, basically denominations in 100 thousand rubles.
- mortgage sheets and bonds of ground banks and private establishments of the long-term credit;
- bonds and stocks of the private companies (stocks were issued only by the commercial enterprises, and bonds as the state and bodies of city self-management). Bonds were issued basically by denominations from 100 up to 5000 rubles, termless loans - in 100 thousand rubles. Bonds and other securities with the state guarantee could not be a subject of Exchange frauds, unlike stocks of the private companies and other securities. Last third of XIX century the most popular were stocks of private railways. The share market of 1995 differs a little:
- the state securities;
- municipal bonds and loans;
- the securities emitted by commercial bank;
- stocks and bonds of the privatized enterprises;
- securities of the private emitters created outside of process of privatization.
The following - current liabilities. They are issued by the Ministry of Finance of the Russian Federation in the paperless form. The purpose is repayment of debts to the enterprises - suppliers to the state orders and mutual payment between the enterprises. Current liabilities become the securities after the term specified in the global certificate of release. Face value of 1 current liability is 1 million rubles, the fixed profitableness at repayment - 40 %.
During the same period of time have appeared Bonds of the State Savings Loan. They are issued in the cash form, face value from 100 thousand up to 500 thousand rubles. Four times a year the coupon income established depending on profitableness of state credit obligations (the State Short-term Obligations) is paid. Sale is made on auctions which are spent or in the form of voice (calculations between participants), or electronic (calculations directly with depository of the Stock exchanges) the trades. A securities market of 1830
- The state and city bonded loans,
- mortgage sheets and bonds of ground banks and private establishments of the long-term credit,
- bonds and stocks of the private companies.
Stocks of private railways are most popular; a securities market in 1992:
- the state securities,
- municipal bonds and loans,
- the securities emitted by commercial bank,
- stocks and bonds of the privatized enterprises, - securities of the private emitters created outside of process of privatization. The state securities are most popular.
Legal aspects.
Initially according to “the companies and stocks” of 1836: all Operations on the stock exchange have been forbidden by Regulations about, but already there was a law on obligatory use of registered stocks. In 1893 have been entered restrictions on carrying out of operations with securities without the share broker. Books of the share broker submitted to audit of the Ministry of Finance, and its chapter could dismiss brokers for abusing, not asking on that of the consent of Exchange committee. Without the permission of financial department it was forbidden to enter securities into the quotation.
On June, 27th, 1900 at the Petersburg Stock exchange the share department, as “a department which was laid down in special conditions of activity” has been created. The department submitted to the Ministry of Finance on especial office by a credit part which began to interfere with activity of the share market.
In 1907 Rules for transactions on purchase and sale of a foreign currency, funds and stocks at the Petersburg Stock exchange have been founded. The bulletin of a share department of the Stock exchange became the official document; the rates specified in it - obligatory for all Russian empire. Brokers were sworn, represented the mortgage and for execution of the transactions concluded at their participation, answered within the limits of data to them of decrees. For the infringements noticed by officials of the Ministry of Finance, could exclude from full members and regular customers.
Nowadays members of the Stock exchange representatives of broker firms, banks, associations, and the dealers, brought a share can be. Physical persons for membership in he Stock exchange should have the certificate of the state bodies on the right of carrying out of transactions with securities. All members of the Stock exchange should correspond to qualifying requirements. By position 1997 the number of members should be not less than 20. The input on a stock exchange is limited. Members of controls, officials, employees of the Stock exchange have the right of a free admission.
 Thank you for your attention and I hope this information will be useful…:)

System and Controls of the Stock Exchange.
The Principal organ of management of the Stock exchange was the Exchange committee - the elective body of Exchange merchant class. It was formed initially for supervision over safety of a new building of the Stock Exchange. With the course of time move to it all function of management, the solution of disputes, communication of businessmen and the governments.
Regulations of 1831 have approved behind Exchange committee the functions of commercial court, management of exchange affairs. At first the committee became an operating agency of the general Exchange assemblies. And since 1875 it was replaced by assembly of member of the city duma (80-150 elected persons).
The structure of Exchange committee (it was approved by above mentioned regulations) included 3 merchants and 3 brokers, was presided by “Mayor”, which headed the Municipal duma. The modern control system is much more complex. It has a great number of committees and departments where a plenty of people is working. Specialization in the decision of separate questions is useful, but on the other hand to the persons bearing the responsibility for activity of the Stock exchange as a whole, can be hard, follow actions of each part of the complex administrative mechanism. Collective nature of departments allows considering in more detail problems and questions, than if departments consisted of one person since people have an opportunity to unite the knowledge, experience, to offer some various decisions of any questions. However, there can be disagreements, and the majority is not always right, and the chief can be mistaken, choosing the correct decision.
In all control systems, beginning with Exchange committee, the basic controls were kept: GENERAL ASSEMBLY which selects EXCHANGE ADVISORY COUNCIL (ASSEMBLY of TOWN-COUNCILLOR). It in turn chooses representatives of BOARD (EXCHANGE COMMITTEE). The truth the PRESIDENT, unlike CHAIRMAN, is the person chosen by board, but the post from it has not changed.
We shall consider functions of the above-named controls:
General meeting of members of Stock exchange is the supreme body of management of the Stock exchange. The decision of following questions concerns to its exclusive competence:
- the statement and change of the charter, balance and other documents;
- an establishment of the sizes of all necessary monetary gathering, sizes of tariffs, payments for exchange services, the sizes of penalties;
- election of members of controls of Stock exchange;
- consideration of complaints to the decision of advisory council of the Stock exchange and boards of directors;
- the statement of the order of a payment and official salaries of the personnel of the Stock exchange.
The functions of Exchange Advisory Council of the Saint-Petersburg Stock exchange:
- an establishment of dates and time for Exchange assemblies;
- drawing up and the edition of rules about the order of carrying out of operations with securities, instructions for brokers on conducting books;
- definitions of the form of bulletin of the Stock exchange;
- an establishment of the size, the order and terms of deductions from a commission of brokers and regular customers of the Stock exchange, payments from visitors;
- the sanction of an assumption of securities and the quotation on the Stock exchange;
- the resolution of disputes, operations arising at carrying out with securities;
- reception and exception of members of the Stock exchange;
- estimating of incomes and charges of the Stock exchange and reports on their execution;
- granting to bodies of local authorities and the government of data and the analytical conclusions concerning development of the financial market.
Also some functions of a higher body can be assigned to Exchange Advisory Council of the Saint-Petersburg Stock exchange.
Board of directors is the executing agency of the Stock exchange. To its competence concern:
- the organization and a management of activity of the Stock exchange and its subdivisions;
- development, change and entering on the statement of General meeting of members of the Stock exchange and Exchange Advisory Council the documents regulating its activity;
- a suspension for the period of exchange trade, in case of if the prices of current transactions on the stock exchange deviate quotations more than on certain Stock exchange size;
- the order of property of the Stock exchange;
- the statement and change of the size deposited in a settlement payment of the mortgage and the liquidating credit;
- hiring and dismissal of personnel of the Stock exchange;
- imposing of penal sanctions.
Functions of Board of directors are carried out by executive committee. It is necessary to mention and the Revision committee. It carries out the current control for financial and economic activities of the stock exchange. Its functions are:
- check of a condition of money resources and property, and also office-work of the Stock exchange;
- drawing up of the report to General meeting about results of audit.

Stockjobbing.
In stockjobbing everyone played their own role. “Aces” set mood of day, giving orders to brokers. Their intentions defined actions of others.
If “the weak mood” (the offer exceeded demand), the “side scene” operating at own expense prevailed, hastened to sell the securities then to redeem them, still, more cheaply, but, bankers, waited, the further downturn that forced the speculators who have bought securities in hope for increase, urgently to sell out them. Brokers started to buy the necessary securities; they were followed with “side scene”, buying papers to sell them when the prices will rise.
In a return case “bulls” started to operate. They added the price and bought up securities, selling them after under higher price. But in parallel with them bankers operated also, the prices grew, but by the end of day of the price were usually stabilized.
Platform. Here played on a difference of rates. Some times for Exchange day intermediaries left on platform and informed on movement of the prices. Intermediaries used that their data cannot be checked up, well and clients could refuse the given assignments at any moment.
“American” is a stock exchange on which it was possible at any moment “to liquidate all unprofitable obligations and to disappear in unknown direction”. In the beginning similar assemblies passed furtively on the Neva prospectus - in the street or in money-change shops (for example, Nikitin’s office). Later all took place in extensive convenient premises.
Data about game on modern Stock exchange are not present, but I do not think, that the little changes took place. Always there are those who speculates on downturn/increase and always to own advantage.

Systems of trade.
The System of the trade by securities, since time of separation of stock exchange from commodity one, constantly changed.
Initially all transactions consist brokers at personal presence of people. Large Stockbrokers, appearing, gave orders to brokers, divided operations among themselves and started to operate. But a plenty present, noise and confusion, false movements, demonstrations, sometimes led to some misunderstanding. For example, on the different ends of hall transactions on the same security under the different price consist.
After the conclusion of significant transactions public gathered in some dense circles where there was a trade on running securities. The form of carrying out reminded auction - the prices were specified. Finally established they were considered after the first call. The second closed an official stock exchange.
Full members of the Stock exchange submitted a note about arranged deals which each broker has been obliged to bring in the books and bulletins, but this rule was quite often broken. Operations proceeded on platform where within day intermediaries informed data on the prices, mood, etc., quite often deceiving gathered there, in own purposes.
As there was one more kind of an informal Stock exchange - “American”. Behind the frauds occurred there to follow it was impossible, there were no legal guarantees.
After creation of an official share department not only system of the trade has changed, but also public of an institution. Its valid members - plenipotentiaries of commercial banks, bank buildings and offices - possessed exclusive rights: to operate without brokers, by proxy (no more than one) and improvised (no more than two). Advisory council of a share department consisted of these people and brokers; they informed given quoted commissions for drawing up of bulletins. The right to conclude transactions through brokers had regular customers, persons of 1-st trade guild of Saint-Petersburg. Visitors of a department could be only observers.
(to be continued…)

Imagine… The Northern capital of the Russian Federation… The city of drawbridges and white nights… And this city has its own stock exchange… And this stock exchange has its own history…
 Yes, to my mind it would be more interesting to learn the history of such little known stock exchange, than different well-known ones. Because the information about international stock exchanges like New-York, London, Tokyo stock exchange, AMEX, etc. you can find anywhere, and about Saint-Petersburg stock exchange not…
 So, the first commodity exchange in Saint-Petersburg appeared in 18 century. A little bit later (in 19 century) appeared the first Saint-Petersburg stock exchange. And in a short space of time took on special significance. It gave fantastic profits to lucky beggars or swingeing damages to losers. It has been revived in our time and makes profits to a great number of people. Who knows, would be these people so rich if they didn’t earn their money in the stock exchange?
 The Saint-Petersburg stock exchange was revived not so long ago (about 15 years ago), that’s why it would be more interesting to investigate its history starting with its foundation…

The history of Saint-Petersburg stock exchange since 18 till 20 century.

 The Saint-Petersburg stock exchange appeared in 1703. Initially it was the meeting of merchants near shopping streets at Troitskaya square. Then since 1713 it was situated at Gostiny Dvor at the same square. By order of Peter I the special building for stock exchange was built opposite of Gostiny Dvor in 1724 (the architect was Trezini). In 1730 the stock exchange was architected to Vasilyevsky Islandto the new building of Gostiny Dvor. Since 1783 at the Spit of Vasilyevsky Island were erecting the special building for stock exchange (the architect was Kwarengi). Unfinished edifice was demolished in1804. In 1805-10 at the Spit of Vasilyevsky Island (Birjevaya square, 4) were constructed new building of stock exchange (the architect was Toma de Tomon). At the same time the quay was rigged. Symbolism of statues, which the stock exchange were decorated, was very interesting. It was the statue of Neptune (the god of seas and oceans) and also the statues of Activity, Hope and Justice. The subsequent sources name a little bit others statues: the statues of Neptune, aged man (symbol of Volga) and woman (the symbol of Neva). On the other side of building were situated woman with the crown and two female figures (rivers) on each side. It was the imagery of navigation. This side of the stock exchange was festooning by the statue of Mercury (the god of trade). And in more subsequent books authors name two statuaries: “Neptune with two rivers” and “Navigation with Mercury and two rivers”.
 Primordially it was just commodity exchange. With the advent of interest-bearing securities in Russia at the Saint-Petersburg stock exchange put into practice stock transactions. Indeed from the beginning securities were one of the commodities. Since 1830 at the stock exchange began to take place operations with securities of private institutions. Since 1860-1870 they were traded actively. In 1900 commodity exchange and stock exchange were divided but continued to work in the same building.
 After Great October Socialist Revolution (1917) stopped to operate all exchanges and they were revived only in 1990. 
 Revival of exchange began on 24th of August of 1990, when was made a decision to found it. It was registered in 1992 and in 1997 the stock exchange was separated from the commodity exchange. According to the regulations of 1992 the Saint-Petersburg stock exchange is juridical person with all its indications (trade mark, its own appellation, State seal, etc.) Since 30 of April of 1992 the exchange “Saint-Petersburg” was registered as closed corporation. And since 18 of March of 1997 it became the nonprofit partnership upon request of Federal Commission on the Securities Market.
(to be continued…)