fairs at 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.

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.

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.

Did you ever think about such questions as when and where the first stock exchange appeared? It was very interesting for me to try to get to know of its story.
So, I’d like to impart this information to you. Predecessors to modern stock exchange were medieval fairs where people could buy or sell bills of exchange. First it was in France in 12th century. There appeared guys who managed and regulated the debts of agricultural communities on behalf of the banks. We could call them first brokers.
Venetian bankers began to trade in government securities in the middle of the 13th century. Later the Dutch started joint stock companies, which let shareholders invest in business ventures. Then the Dutch East India Company issued the first shares on the Amsterdam Stock Exchange in 1611. It was the first company to issue stocks and bonds. And the Amsterdam Stock Exchange is the oldest stock exchange in the world that exists at present time.
Right up to 1913 the Amsterdam Stock Exchange was the universal exchange where traders sold and bought both goods and seсurities. Just here all methods of security trade (for example, term deals, options, carry-over deals, margin deals, etc.) came into the world.
The technique of security trade was similar to the technique of exchange trade of goods, but insensibly the specific rules of conduct were elaborated. The greatest complexity for traders was the prohibition, which was implemented in 1622, “not to make the air blue”.
At the begining the access to the Amsterdam Stock Exchange was free; any trader had the right to to make bargain with anyone. Conclusion contract finished with the hand shake, which was one of the rules of the stock exchange.
As for stocks, only stocks of the first stock company in the Netherlands (Joint East India Company) circulated at the Stock Exchange.
The stock exchange based in Amsterdam merged on September 22, 2000 with the Brussels Stock Exchange and the Paris Stock Exchange to form Euronext, and is now known as Euronext Amsterdam.
The second according to the time of origing was the stock market of Great Britain. Exactly at the England territory made its appearance the first specialised exchange, when in 1773 London brokers rented a specil accommodation for their meetings. Membership at the stock exchange the same way as at the Amsterdam Stock Exchange was free, anyone who wished were able to take part in trade, but he had to pay for it 6 pence per day.

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