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Stock Exchanges Before The SEC

National securities exchanges are registered with the Securities and Exchange Commission under Section 6(a) of the Securities Exchange Act of 1934.  Before there was an SEC or an Exchange Act, the United States was populated with local stock exchanges.  At the turn of the last century, the mining town of Goldfield Nevada supported two stock exchanges - the Goldfield Mining Stock Exchange (which began in the Northern Saloon) and the Goldfield Stock and Exchange Board.

Early exchanges were raucous affairs, relying on shouting and even physical strength.  The Goldfield News described one day's trading in November in 1906:

"The day had been marked by great fluctuations on the stock exchange and strikes and rumors of strikes in the mines.  Hence the curb was a tumultuous one.  Buyers, sellers and spectators jostled and tread on each other's corns, making flying wedges and mass plays in the direction of each successive center of interest . . . Everything was by word of mouth."

Reprinted in Sally Zanjani, The Glory Days in Goldfield, Nevada.

This description does not sound much different than the stock exchange encountered by the fictional Reb Tevye a world away in Yehupetz (Kiev):

"It was crowded, impossible to push through.  People were tearing around like madmen, this one here, that one there, one on top of the other - it was chaos.  They were talking, screaming, waving their hands in the air: 'Shares, stocks . . . he gave me his word . . . I need a down payment . . . a fee . . . you're an idiot . . . I'll  bash your head in . . . spit in his face . . . what a speculator . . . chiseler . . . your father's father!'"

Sholem Aleichem, Tevye der milkhiker (Tevye the Dairyman) (A. Shevrin tr.) 

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About this Author

Keith Paul Bishop, Corporate Transactions Lawyer, finance securities attorney, Allen Matkins Law Firm
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Keith Paul Bishop is a partner in Allen Matkins' Corporate and Securities practice group, and works out of the Orange County office. He represents clients in a wide range of corporate transactions, including public and private securities offerings of debt and equity, mergers and acquisitions, proxy contests and tender offers, corporate governance matters and federal and state securities laws (including the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Act), investment adviser, financial services regulation, and California administrative law. He regularly advises clients...

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