A Real Seat
In 2005 you could have paid $4 million (an all time high) for a seat on the New York Stock Exchange (NYSE) but you would have had almost nothing on which to sit. Looking down from the balconies overlooking the huge trading floor of the NYSE, until now, you would have seen most people standing at the multiple trading posts that dominate the floor and at the broker stations to the side. Now though, as part of a $10 million renovation, certain floor traders will have new stations, brighter lighting, curved glass walls, and, for the first time in recent history, chairs.
Owning an NYSE seat meant that you or your firm had the right to trade securities on the exchange. Today, with Euronext owning the NYSE, traditional seats are no longer for sale.
The Economic Lesson
The history of the NYSE dates back to 1792 when 24 of the new nation’s financiers signed the Buttonwood Agreement. Named for the tree under which they gathered to trade securities at 68-70 Wall Street, these gentlemen agreed to a specified commission and mutually preferential treatment. When continuous trading began in 1871, members no longer sat in their chairs for scheduled stock auctions.