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A Tree Grows on Wall Street

A Tree Grows on Wall Street

On May 17, 1792, twenty‐four brokers got together to sign an agreement that was the framework that established the New York Stock Exchange. They met outside of 68 Wall Street under a Buttonwood Sycamore tree.

The Buttonwood Agreement

This document later called the “Buttonwood Agreement,” was the operating agreement that helped create the greatest and largest capital trading market in history. Signed 230 years ago, it allowed investors, no matter who they were ‐ wealthy or poor, no matter whom they knew, or where they came from, to invest in and own a part of the new American economy. As our country developed, Investors could buy a piece of the new country’s industries: railroads, motor cars, manufacturing, shipping, gas companies and the new electric companies. The wealthiest member of society could invest, but so could “Mr. Smith” from the local general store.

A Tree Grows on Wall Street

The purpose of this market was not to trade (buy and sell on every small movement) but to invest in the future. The dream was not to arbitrage or invest in financial instruments. It was not to take advantage of market timing or small movements. The purpose was to invest and provide the capital for the new country. The capital that would provide jobs and the largest middle class the world has ever seen. The purpose was to invest to make your future, your life, and the life of your children a little better.

I’m sure those twenty‐four brokers never thought about put or call options, ETFs, or index funds. What they thought about, and invested in, were companies that fueled the growth of the new Great American Economy.

With each dollar invested in today’s newly created financial instruments a dollar is taken away from the capital needed to lift the world out of poverty and make the planet a better place to live. Twenty‐four brokers started a closed club that’s purpose was not only to make money, but also to be a system to provide capital and liquidity for the dreams of a new nation.

That’s not what the markets are today. Today, computerized trading destroys the dream, hedge funds place the bets, shorts stand by to kill the entrepreneur before they get a chance to build a business. It is a system that increases investment risk with every new instrument created. It is a gambling casino not a capital market.

From the Wall Street Tree to New York Stock Exchange

Once, a tree grew on Wall Street. That tree produced a seed which became the New York Stock Exchange… a simple “Buttonwood tree”. I hope somewhere in this great nation there is a seed planted that will lead us to a new market that encourages dreams, ideas, and hopes. I hope for a market where people invest, not trade, a market where financial products created so a person can place a bet are prohibited. A market whose purpose is to provide capital to our companies, new and old, so we can continue to provide jobs and lift the world and its people out of poverty…a new “Buttonwood tree.”


Damon D. Testaverde