Origin of the word Stock Exchange
Zurich Stock Exchange.
Ter Beurze house in the city of Bruges.
Ter Beurze house in the city of Bruges.
Owes its origin the word “exchange” to Van der Borsn (Van der Bürsen family name Belgian), which has been working in the field of banks, and agreed that the hotel is owned by the family in Bruges be a meeting place for local merchants in the fifteenth century, became over time a symbol the capital market and the Mercantile Exchange. The first publication of what looks like a list of stock prices throughout the trading period for the first time in 1592 in Anffers (Anvers) came.
Its role in the eyes of liberal economists
Secure liquidity for the exchange of shares offered in the primary market As the underwriter, the stock can sell its shares on the stock exchange, called the market the secondary market on the basis of supply and demand, and by the emergence of the stock market, anyone wants to sell a stake to him in a company, announces that through brokers and friends, while now able to sell any share his -alta now called Oshma- cross-known stock market techniques.
Facilitate the collection of cash for growth companies The method of issuing shares are the easiest and most commonly used to finance the company’s expansion activities Examples of activities of the company’s expansion acquisition of other companies and expand production lines and increase market share and mergers etc ….
Stimulate savings into investment Instead of saver puts his money in the bank returns relatively low interest rates, the ease of investing in the financial market stimulates the saver to invest his money in the various economic sectors. In order to encourage members of the community to invest it must first be an interest rate cut in the banks and the opening of investment in the community and encourage small investors forgive the taxes for a certain period and help them to market their products and training for those in need of training while working to open new markets for Hola investors.
Assist the government and companies to raise money for development projects Governments or investment companies can raise enough cash for development projects by borrowing money in order to cover the costs of infrastructure projects and facilitate financial market, and by subtracting the shares or bonds in this market.
Redistribution of wealth Given the wide segment of the population in the financial markets, the gains help narrow the gap between rich and poor.
Stimulate corporate governance The concept of corporate governance means that the company’s good management commitment, and because the financial market contributes to the expansion of the shareholder base, companies seeking to attract shareholders more to serve the expansionist goals is the most important to attract these investors administration efficiency in achieving the goals of shareholders standards so the general trend that the contribution offered to the public or companies the so-called IPO companies need to be available in the administrative efficiency greater degree of joint stock companies, which did not come up for public subscription or the so-called family business, where that whenever the company abided by the rules of governance the greater investor confidence in them.
The stock gauge indicators of economic performance The financial markets are functioning as a mirror of the economy ((often)) through the interaction of the forces of supply and demand and the impact of these forces the economic situation. Indicator General of stock prices in the financial market is one of the previous indicators of events, given that stock prices are a reflection of the expectations of economic events that will prevail in the future and therefore move in the level of Almahrsov reflects the economic situation that will prevail and thus helps makers of economic policy of taking the right measures. The stock market plays an important role in economic life, and if we tried to show the most important functions that can be performed, it can be counted as follows: (1) National economic development by encouraging direct savings to invest in the stock, which encourage the stock market small savers and their elders who have a surplus of Mali can not be used to carry out independent projects with their money because of the lack of investment idea they have, and then they prefer to buy securities as much of their money, and this helps to development purposes and is worth mentioning that the service purchasing power of money decreases over time and therefore the investment of the money helps to increase it to reduce erosion by inflation. (2) to assist in the transfer of funds from groups that have a surplus (lenders) to groups that have a deficit (the borrowers). Lenders are reducing the current consumer expenses in exchange for higher incomes in the future when the maturities of these loans solutions, and when the borrowers using that borrowed to buy and lease elements of production funds, they will produce higher incomes, thus increasing the standard of living not only for borrowers but for all segments of society . (3) contribute to the financing of development plans by asking government securities in that market. Where he was accompanied by the emergence of the importance of the securities issued by joint stock companies increased recourse governments to public borrowing from members of the public, to meet the growing expenditure and financing for development projects, through the issuance of bonds and notes issued by the public treasury with different deadlines, hence these instruments has become an area for investment of funds not At least as important as other aspects of employment. (4) contribute to the internal and external credit support. Where the sale and purchase of currencies in the stock market is a manifestation of the internal aspects of the credit, if the increased manifestations of this credit to include securities traded on global exchanges became possible to accept such securities as cover for holding financial loans. (5) contribute to achieving high efficiency in channeling resources to the most profitable areas; which is accompanied by the growth and economic prosperity. This requires several features available in the stock market, it can be summarized as follows: (A) Efficient pricing: the sense that prices reflect all available information. (B) Operating efficiency: the sense that the cost of diminished pain