- Source: Buttonwood Agreement
The Buttonwood Agreement is the founding document of what is now the New York Stock Exchange and is one of the most important financial documents in U.S. history. The agreement organized securities trading in New York City and was signed on May 17, 1792 between 24 stockbrokers outside of 68 Wall Street. According to legend the signing took place under a buttonwood tree where their earliest transactions had occurred. The New York Stock Exchange celebrates the signing of this agreement on May 17, 1792 as its founding.
History
In March 1792, twenty-four of New York's leading merchants met secretly at Corre's Hotel to discuss ways to bring order to the securities business. Two months later, on May 17, 1792, the group signed a document called the Buttonwood Agreement, named after their traditional meeting place under a buttonwood tree – not because it was signed there.
There were too many brokers involved to meet under a tree. Business was conducted in various offices and coffee houses. In 1793, they coordinated their business inside the Tontine Coffee House on the corner of Wall and Water streets.
The document is now part of the archival collection of the New York Stock Exchange.
Document agreement
In brief, the agreement had two provisions: 1) the brokers were to deal only with each other, thereby eliminating the auctioneers, and 2) the commissions were to be 0.25%. It reads as follows:
We the Subscribers, Brokers for the Purchase and Sale of the Public Stock, do hereby solemnly promise and pledge ourselves to each other, that we will not buy or sell from this day for any person whatsoever, any kind of Public Stock, at a less rate than one quarter percent Commission on the Specie value and that we will give preference to each other in our Negotiations. In Testimony whereof we have set our hands this 17th day of May at New York, 1792.
Signers
The twenty-four brokers, known as Founding and Subsequent Fathers, who signed the Buttonwood Agreement were (including business location):
Peter Anspach … 3 Great Dock Street
Armstrong & Barnewall … 58 Broad Street
Andrew D. Barclay … 136 Pearl Street
Samuel Beebe … 21 Nassau Street
G. N. Bleecker … 21 Broad Street
Leonard Bleecker … 16 Wall Street
John Bush … 195 Water Street
John Ferrers … 205 Water Street
Isaac M. Gomez … 32 Maiden Lane
Bernard Hart … 55 Broad Street
John A. Hardenbrook … 24 Nassau Street
Ephraim Hart … 74 Broadway
John Henry … 13 Duke Street
Augustine H. Lawrence … 132 Water Street
Samuel March … 243 Queen Street
Charles McEvers Jr. … 194 Water Street
Julian McEvers … 140 Greenwich Street
David Reedy … 58 Wall Street
Robinson & Hartshorne … 198 Queen Street
Benjamin Seixas … 8 Hanover Square
Hugh Smith … Tontine Coffee House
Lutton & Hardy … 20 Wall Street
Benjamin Winthrop … 2 Great Dock Street
Alexander Zuntz … 97 Broad Street
References
External links
Image of agreement at the Virtual Museum and Archive of the History of Financial Regulation of The Securities and Exchange Commission Historical Society
Video of agreement as part of story on the CNBC cable network.