Buttonwood Agreement

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File:Buttonwood.png

Depiction of traders under the buttonwood tree

File:Tontine coffee house.jpg

A 1797 painting by Francis Guy. The building with the American flag is the Tontine Coffee House. Diagonally opposite (southeast corner, extreme right)<ref>Hewitt, p. 31</ref> is the Merchant's Coffee House, where the brokers of the Buttonwood Agreement and others traded before the construction of the Tontine. On the right is Wall Street, leading down to the East River.

The Buttonwood Agreement is the founding document of what is now the New York Stock Exchange and is one of the most important financial documents in U.S. history.<ref name="CNBC">Template:Cite news</ref> The agreement organized securities trading in New York City and was signed on May 17, 1792 between 24 stockbrokers outside of 68 Wall Street. According to legend the signing took place under a buttonwood tree where their earliest transactions had occurred.<ref name=SB>Template:Cite journal</ref> The New York Stock Exchange celebrates the signing of this agreement on May 17, 1792 as its founding.<ref name="CNBC" />

History

In March 1792, twenty-four of New York's leading merchants met secretly at Corre's Hotel to discuss ways to bring order to the securities business. Two months later, on May 17, 1792, the group signed a document called the Buttonwood Agreement, named after their traditional meeting place under a buttonwood tree – not because it was signed there.<ref name=SB />

There were too many brokers involved to meet under a tree. Business was conducted in various offices and coffee houses. In 1793, they coordinated their business inside the Tontine Coffee House on the corner of Wall and Water streets.<ref name="Richard J. Teweles, Edward S. Bradley, and Ted M. Teweles 1992 97" />

The document is now part of the archival collection of the New York Stock Exchange.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>

Document agreement

In brief, the agreement had two provisions: 1) the brokers were to deal only with each other, thereby eliminating the auctioneers, and 2) the commissions were to be 0.25%. It reads as follows:

Signers

The twenty-four brokers, known as Founding and Subsequent Fathers, who signed the Buttonwood Agreement were (including business location):<ref>Template:Cite book</ref>

• Peter Anspach … 3 Great Dock Street
• Armstrong & Barnewall … 58 Broad Street
• Andrew D. Barclay … 136 Pearl Street
• Samuel Beebe … 21 Nassau Street
• G. N. Bleecker … 21 Broad Street
• Leonard Bleecker … 16 Wall Street
• John Bush … 195 Water Street
• John Ferrers … 205 Water Street
• Isaac M. Gomez … 32 Maiden Lane
• Bernard Hart … 55 Broad Street
• John A. Hardenbrook … 24 Nassau Street
• Ephraim Hart … 74 Broadway
• John Henry … 13 Duke Street
• Augustine H. Lawrence … 132 Water Street
• Samuel March … 243 Queen Street
• Charles McEvers Jr. … 194 Water Street
• Julian McEvers … 140 Greenwich Street
• David Reedy … 58 Wall Street
• Robinson & Hartshorne … 198 Queen Street
• Benjamin Seixas … 8 Hanover Square
• Hugh Smith … Tontine Coffee House
• Lutton & Hardy … 20 Wall Street
• Benjamin Winthrop … 2 Great Dock Street
• Alexander Zuntz … 97 Broad Street

External links

• Image of agreement at the Virtual Museum and Archive of the History of Financial Regulation of The Securities and Exchange Commission Historical Society
• Video of agreement as part of story on the CNBC cable network.