what is wall street 
wall street is literally a street located in new york city at the southern end of manhattan figuratively wall street is much more it s synonymous with the financial industry and the firms within it this connotation has its roots in the fact that so many brokerages and investment banks historically have established their headquarters in and around the street all the better to be close to the new york stock exchange nyse being on or near wall street is no longer considered essential for financial institutions in fact these days they are located all around the country however the term wall street still means business the investment business and the interests motivations and attitudes of its players understanding wall streetwall street and its surrounding southern manhattan neighborhood known to locals as the financial district remain an important location where a number of financial institutions are based the financial district is iconic with the bronze arturo di modica statue of the charging bull however the globalization and digitization of finance and investing have led to the rise of many u s broker dealers registered investment advisors and investment companies located elsewhere still wall street remains a collective name for the financial markets the companies that trade publicly and the investment community itself stock exchanges investment banking firms commercial banks brokerages and broker dealers financial services and underwriting firms all symbolize wall street it s a globally recognized expression that to some extent ever refers to the u s financial system both the nyse the largest equities based exchange in the world and the federal reserve bank of new york arguably the most important regional bank of the federal reserve system are based in the wall street area wall street is often shortened to the street which is how the term is frequently used by those in financial circles and the media for example when reporting a company s earnings an analyst might compare a company s revenues to what the street was expecting in this case the analyst is comparing the company s earnings to what financial analysts and investment firms were expecting for that period the importance of wall streetwall street has had an important impact both economically and culturally the u s is the largest economy in the world and new york city is its financial center as such wall street s global importance is unparalleled wall street consists of some of the largest financial institutions in the world and employs hundreds of thousands of people it s home to the nyse and nasdaq stock exchanges two of the largest stock exchanges in the world on these exchanges are listed some of the biggest companies including amazon google apple and exxon the economic importance of wall street extends throughout the american and international economies as many financial firms do business worldwide extend loans to a variety of businesses and individuals and finance large scale global projects wall street s cultural influence extends to movies tv shows books and more films such as wall street margin call boiler room barbarians at the gate and more from previous decades highlight what the fast paced life is like on wall street they display an exciting wealthy and interesting lifestyle large players on wall street have become celebrity icons warren buffett jamie dimon carl icahn bernie madoff george soros and larry fink are names familiar to many in the imaginations of some in contemporary society the term wall street may evoke a sense of power the elite and often unscrupulous behavior during times of economic trouble such as the financial crisis of 2008 wall street sometimes becomes a scapegoat and the ills of the economy are blamed on the assumed greed associated with it no other financial term has become so woven into the global culture history of wall streetwall street got its name from the wooden wall dutch colonists built in lower manhattan in 1653 to defend themselves from the british and native americans the wall was taken down in 1699 but the name stuck 1given its proximity to new york s ports the wall street area became a bustling center of trade in the 1700s its origins as a financial center began in 1792 when 24 of the most prominent brokers and merchants in the u s signed the buttonwood agreement they reportedly gathered on wall street under a buttonwood tree to do business 21the agreement outlined the common commission based form of trading securities in effect it was an effort to establish a members only stock exchange some of the first securities traded were war bonds and the stocks of such institutions as the bank of new york 32out of this acorn of an agreement the oak that became the nyse grew in 1817 the buttonwood brokers renamed themselves the new york stock and exchange board the organization rented out spaces for trading in several locations until 1865 when it settled on a location of its own at the corner of wall and broad streets 1the location of the beating heart of wall street the nyse is a 1903 neo classical structure of white marble an adjacent annex constructed in 1922 is located at 11 wall street and another subsidiary building is at 20 broad street these three buildings fill the block bounded by wall street on the north broad street on the east exchange place on the south and new street on the west 4as the u s grew several other major exchanges established headquarters in the wall street area these included the new york mercantile exchange the new york board of trade the new york futures exchange nyfe and the american stock exchange now known as the nyse american options to support the exchanges and to be where the action was banks brokerage firms and financiers clustered offices around wall street in the late 19th and early 20th centuries the house of morgan officially j p morgan co the forerunner to jp morgan chase and morgan stanley was directly opposite the nyse at 23 wall street after world war i new york city surpassed london to become the world s largest and most significant financial center wall street vs main streetwall street is often compared and contrasted to main street the term main street is used as a metaphor for individual investors small businesses employees and the overall economy it s derived from the common name for the principal street of a town where most of the local businesses are located there is often a perceived conflict between the goals desires and motivations of main street and wall street wall street tends to represent big businesses and financial institutions while main street represents mom and pop shops small companies and individuals key events on wall streetevents that happened on or around wall street often have impacted not just the investment industry but the global economy and society here are some significant moments in wall street history on july 8 1889 charles dow edward jones and charles bergstresser launched the wall street journal a four page afternoon newspaper devoted to objective financial and business news the three men were reporters but dow was also a numbers cruncher who came up with the idea of creating a benchmark list of companies and their stock prices to represent the entire stock market 5soon the journal was publishing the dow jones industrial average djia index along with hundreds of prices of company stocks bonds and futures and the average prime rate for bank loans for nearly a century before the advent of real time internet listings the journal was the paper of record for the financial markets it evolved into a six day a week periodical that s been online since 1996 the journal is a leading and well respected source of financial and business journalism the three founders operated out of offices in lower manhattan the fact that they chose to name their new publication the wall street journal indicates that wall street already was something of an umbrella term for the world of finance and its denizens over the years the paper helped fix this meaning in the public s mind it was around noon on sept 16 1920 a horse drawn cart pulled up at 23 wall street right in front of the headquarters of j p morgan co a bustling corner of the neighborhood it was especially crowded with those headed out for lunch the cart suddenly exploded it had been packed with dynamite and filled with sash weights that sailed through the air 6at that time it was the worst domestic bombing in u s history ultimately 40 people were killed or died from their injuries and another 300 were injured the j p morgan building s interior was gutted marks from the shrapnel still are visible on the exterior 7no one claimed credit and the case was never solved but because the explosion occurred in front of the morgan building known as a symbol of american capitalism the bombing was ultimately decided to have been an act of terrorism performed by reds anarchists and communist sympathizers a stack of anarchist flyers found in a mailbox a block away from wall street supported this theory 7as a result the authorities arrested hundreds of suspected reds and deported those of foreign nationality the bombing also encouraged the nativist sentiments that developed in the u s during the 1920s which led to tighter restrictions on immigration 7the stock market crash of 1929 remains the worst financial crisis in u s history in a pre digital trading era its epicenter was the nyse the crash began on october 24 when after nearly a decade of unparalleled uninterrupted growth the stock market opened lower than the previous session equities prices continued to drop throughout the day and as the news spread crowds began to gather outside the exchange 8they groaned as the market closed down again that day cheered brokers during the next two days when the market seemed to rally and then panicked on october 28 and october 29 when the declines resumed inside the stock exchange the scene was sheer pandemonium as prices fell too fast for ticker tapes and blackboards to record them 8ultimately the djia was to fall 89 from its september 1929 peak wiping out both corporate and individual wealth 8the crash ushered in the great depression a quarter of america s working population lost their jobs as the u s economy went into a tailspin economies throughout europe followed suit in the end the stock market crash and the ensuing decade long depression directly impacted nearly every segment of society and altered an entire generation s perspective of and relationship to the financial markets 9on what is known as black monday oct 19 1987 the s p 500 index and dow jones industrial average plunged more than 25 in value leading exchanges around the world to drop in a similar frenzy the week prior indices had fallen an approximate 10 priming the pump for the ensuing panic up until that time a bull market had been in control since 1982 thanks to the actions of chairman alan greenspan and the federal reserve a seeming disaster on a global scale was averted but the crash brought to light the potential for disruption that the then new technique of computer programs instigating large scale amounts of trading might cause even though enormous amounts of trading were handled by humans that day as well the exact cause of this short term crash has never been pinpointed however afterwards exchanges implemented circuit breaker rules to prevent program trading from spurring runaway selling it was hoped that this and other trading curbs would allow the markets time to stabilize and give regulators and investors the chance to take appropriate steps the global financial crisis of 2007 2008 resulted from years of deregulation easy credit predatory mortgage lending the collapse of the subprime mortgage market and the unregulated use of derivatives it led to the great recession the root cause of the crisis was unethical and exploitative behavior by banks investment banks and insurance firms borrowers with unsatisfactory credit were given mortgage loans without concern for their ability to pay them off and without their comprehension of the risks involved with the loans as rates rose those borrowers mortgage rates reset higher and they couldn t afford to make monthly payments what s more as home prices fell dramatically homeowners couldn t sell their houses for enough to cover their loans this caused massive numbers of defaults risky derivative securities had been created with the subprime mortgage loans sold by banks in addition banks and other large investors used customer deposits to invest in these derivatives with the defaults on home loans the derivatives plunged in value many financial institutions had ties to the loans derivatives and credit default swaps an insurance product that investors in the derivatives bought to protect against the risk of default thus they found themselves in severe trouble after the housing market bubble burst from housing industry crash to a u s financial industry on the brink of collapse to the near ruin of other financial systems across the globe it was the worst financial crisis since the stock market crash of 1929 the u s government had no choice but to bail out financial institutions that had always been considered too big to fail occupy wall street was a 2011 protest movement against social and economic inequality that was centered in zuccotti park located in manhattan s financial district it began on september 17 as hundreds of protesters camped out in the park the police forcibly removed and arrested them two months later on november 15 during the intervening period there were marches and speeches calling for more balanced income distribution better paying jobs bank reform and less corporate influence in politics we are the 99 was the occupy protestors slogan the regulation of wall streetregulatory measures were put into place to address the lack of government oversight that was considered to have led to the crisis that began in 1929 among other things the securities act of 1933 required financial institutions to provide investors with all significant information about securities being offered for sale it also prohibited fraud in securities sales the securities exchange act of 1934 established the securities and exchange commission sec and gave it significant power over the securities industry this included the authority to regulate brokerage firms and to require financial reporting by publicly traded companies in 2010 congress passed the dodd frank wall street reform and consumer protection act dodd frank it created new government agencies with financial system oversight the idea behind the act was to address the risky behaviors of financial institutions and the dearth of regulatory oversight that led to the crisis one area of grave concern was the predatory mortgage lending that had occurred another focus was the stability of financial institutions the act made it possible to liquidate or restructure firms if necessary to prevent the use of taxpayer funds to keep them afloat the act s volker rule restricted the investing practices of banks and regulated derivative securities it also set up the sec office of credit ratings to ensure that credit agencies henceforth issued appropriate ratings for institutions rather than the fabricated favorable ratings that were part of the lead up to the crisis the economic growth regulatory relief and consumer protection act signed in 2018 by president trump addressed criticisms of dodd frank and rolled back some of its provisions among other things it exempted banks with assets of less than 10 billion from the volker rule requirements gave consumers the ability to freeze their credit files at no cost and eased capital requirements for banks that didn t offer lending or traditional banking services 