The Stock Market has been a large part of the American Economy since the country started trading. Traced back to the American Revolution in the 1700's and is still working today.
During the American Revolution, the Colonial Government needed money to fund its wartime operations. One way they did this was by selling bonds. Bonds are pieces of paper a person buys for a set price, knowing that after a certain period of time; they can exchange their bonds for a profit. Along with bonds, the first of the nation's banks started to sell parts or shares of their own companies to people in order to raise money. In essence they sold off part of the company to whoever wanted to buy it, which is the essence of the modern day stock market. .
With the start of the 1900's brought the start of the Industrial revolution and America as an economic power house. However, the economic officials began to be a little unorganized on how they used money. In the mid-1920's businesses that were seeking more profit, started raising the price of there stocks. This caused the demand to lower because consumers couldn't afford these raised stocks. In 1929 the stock market crashed and sparked America to go into the Great Depression. .
Franklin D. Roosevelt became president in 1933 during the peak of the Great Depression. His plan the "New Deal" was his way to take the United States out of the depression. Although President Roosevelt's New Deal worked to an extent, the U. S. did not have a full recovery until after World War II in the late 1940's. .
The Stock Market began to flourish again. Businesses began buying and selling more stocks. Just about every consumer product had away to buy it in stocks and bonds.
Right now, the New York Stock Exchange has billions of dollars changing hands every day, with thousands of companies being traded, and millions of people being affected.