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The origins and power of the US Stock Market

It is no secret that the US stock market is the biggest in the world, however, what many people do not know that it is not just the New York Stock Exchange or the Nasdaq, rather the US stock market is made up of 13 different exchanges!

Stock market graph-1

Although the companies that underpin these two major markets can account for 6 for the 13 exchanges. In addition, there are four other U.S. stock exchanges owned by Bats Global Markets. As well as two independent exchanges — the Chicago Stock Exchange and the National Stock Exchange as well as the newest that of the IEX.[1]

Of all the markets, the New York Stock Exchange (NYSE) is the leading stock exchange in the world, the trading approximately 1.46 billion shares each day in stocks for some 2,800 companies.[2]

To put it into perspective, in Australia we have around 1.4 to 1.6million equities trades per day[3] in around 2000 companies.

The origins of the US stock market

It would surprise many to know that the US stock market was not founded in New York, but Philadelphia.

It soon became the most powerful exchange not only in the country, but in the world after its foundation in 1817, being positioned at the centre of US trade and economics, New York.[4]

How powerful is the US Stock Market?

The US stock market, in particular the New York Stock Exchange, is the largest in the world. As such, it is immensely powerful; one only needs to go back to 2008 to see just how powerful, the US stock market essentially sunk the global economy, wiping over $12 trillions from it!

Although the US stock market alone was not solely responsible for the crash, it was helped well along the way by poor government policy, deregulation of some financial sectors, and poor policing of the housing loans market – essentially giving houses to anyone, even NINJA’s as they were called.

‘No Income No Job Applications’ were a real thing, and unscrupulous loan brokers would offer them to just about anyone to get their commission – despite their ability to repay the loan.

So, how does this affect the US stock market? The stock market is made up of all the top listed companies in the country, including banks. These banks issued the loans, that were inevitably unable to be repaid and the banks were stuck with them, then the market created CDF’s or credit default swaps offering investors to bet against the housing market - which these banks would gladly offer out, as ‘who bets against the housing market’.

However, when the housing market crashed, the CDF’s needed to be paid out and several banks collapsed with it, in turn bringing down the whole US Stock Market, the whole US economy and in turn the global economy with it.

So, when you think of importance in real terms of the US stock market, it is very big, very powerful and impacts global markets both positively and negatively depending on their trading day.






We welcome you to give our team a call to discuss your investment goals and objectives.

You can call Walker Capital Australia on +61 2 8076 2210, and we’ll see how we can help you achieve your investment goals.

Want to read more great information on Stock Market? Check out Stock Market article: Stock Market