As prices for some bulbs reached extraordinarily high levels and then dramatically collapsed, the “tulip mania” is generally considered the first recorded speculative bubble in history, although the trading was not as irrational as usually thought. The most notable centred on the tulip – VOC ships carried these flower bulbs into the country from places like Turkey. The Netherlands was also heavily urbanised, with a large number of people available and willing to invest their money.įormal futures markets, which allow people to bet on the future price of certain assets, also appeared in Amsterdam during the 17th century, reflecting the growing sophistication of financial activities in the city. A significant portion of the famously flat Netherlands used to be submerged, which meant the Dutch were used to loaning money to fund land reclamation projects. Two geographical factors played an important part in Amsterdam becoming a major financial centre. At its peak, the VOC was worth more than Apple, Google and Facebook combined. ![]() This was none other than the world’s first initial public offering (IPO), and provided the capital to fuel the growth of this trading company to become one of the largest multinationals of the era. It happened first in Amsterdam when the Dutch East India Company or Vereenigde Oostindische Compagnie (VOC) issued shares to the public for the first time. While share certificates had first been issued in 1288 when the Swedish copper mining company Stora granted the Bishop of Västerås 12.5% ownership, it wasn’t until the early 17th century that organised stock-trading began to emerge. This was the time of the Dutch Golden Age, when its science, culture and commerce were among the most celebrated in the world. It was an exchange building built by merchants on the River Amstel, Amsterdam. At the beginning of the 17th century, the financial centre of the world was not London, New York or Tokyo. So how did this happen, and where do things go from here?įirst a bit of history. ![]() It is quite a shift for a city that was fifth behind Paris, Frankfurt and Milan only two months ago, while for the UK this is one of numerous recent developments that highlight the downsides of leaving the EU. Amsterdam has usurped London to become Europe’s biggest hub for trading shares.
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