People who know nothing of high finance still recognize the name "Wall Street." Even if they do not know anything about business or the city of New York, they know that is where the big money lives. Today the term is used to signify any financial interests of the United States, but in the late 18th century it meant the place where all stocks and securities in the country were bought and sold.

Surprisingly enough, the street is called "Wall Street" because once it ran alongside a wall. During the 17th century, the wall marked the northern boundary of the New Amsterdam settlement constructed in 1652 of timber and earthwork. The wall was supposed to serve as defense against the Lenape Indians, New England colonists, and the British, but was never tested in battle. The British dismantled the wall in 1699.

Street Corner Trading

Due to the urging of Alexander Hamilton, whose statue now shares the street along with the temples of high finance, trading in United States government debt securities began at the corner of Wall Street and Broad Street in the late 18th century. Trading expanded to include other stocks and securities there until 1817 when the New York Stock & Securities Board was formed. Now known as the New York Stock Exchange (NYSE), the market was joined by the American Stock Exchange (AMEX) – then called the New York Curb Exchange -- in 1842.

Today the street is still home to both exchanges in addition to commodity exchanges and numerous commercial and investment banks. The area in lower Manhattan, known as the "financial district," also houses high powered law firms and a number of historic buildings. George Washington, the first president of the United States, was inaugurated on the steps of Federal Hall on Wall Street and the first Congress met there. At the time, New York was the nation's capital.

Fortunes and Failures

By the early days of the 20th century, huge fortunes were being made on Wall Street. In 1901, financier J.P. Morgan rocked Wall Street by creating a billion dollar merger that created U.S. Steel Corporation. In 1907, the street saw one of its first panics as $800 million in securities were unloaded within a few months. Stock prices plummeted and runs on banks occurred daily.

The first of the two largest Wall Street crashes occurred in 1929, bringing an end to the "Roaring 20s," due to overly optimistic pronouncements of Wall Street insiders which had seen stock prices rise more than 400 percent since 1924. The bottom fell out of the market in a week's time and devastated the country, prompting some brokers and investors to jump out of their office windows. The result was the Great Depression that lasted until the beginning of World War II in 1941. The most recent Wall Street crash in 1987, known as "Black Monday," saw the Dow Jones average drop 508 points, the largest one-day drop in the stock market's history.