Until 1793, too many brokers were involved to meet under a tree. They took their place in an elaborate structure at the corner of Wall and Water streets, called Tontine Coffee House. Their new project was to become the largest investment market in the country – the New York Stock Exchange, which is only a few blocks from where the old button tree once grew. Long before the One World Trade Center overlooked Lower Manhattan, an American sycamore or woodwood on Wall Street was the highest thing in the area and the mall. 225 years ago, on May 17, 1792, 24 brokers and traders under the same tree signed the so-called Buttonwood Agreement, which set the trading parameters in the first incarnation of the New York Stock Exchange. The Buttonwood Agreement was signed in 1792 between 24 Wall Street brokers and traders in New York to create a stock exchange. Rumor has it that the deal happened under a button tree marked the beginnings of the Wall Street investment community. The agreement created confidence in the system in which brokers and traders acted only among themselves, while representing the interests of the public. By closing the system, participants would be assured that they can trust each other and that the payments are rewarded and that the investments are legitimate. On May 17, 1792, the Buttonwood Agreement was signed by 24 brokers. The signing took place outside 68 Wall Street in Lower Manhattan, New York, under a button tree.
The meeting was to negotiate the terms and rules of the speculative market. Early trade took place in cafes and taverns (as well as on the street in good weather), but brokers also began holding auctions in their offices. In early 1792, John Sutton and his partner Benjamin Jay and a few others decided to create a centralized sale to Wall Street 22. Sellers would deposit the securities they wanted to sell, buyers would participate in the auction, and auctioneers would take a commission on the sale price. The agreement was an attempt to establish, after the financial panic of 1792, certain rules on which there were no rules or guarantees and many transactions were refused. The panic had been caused by the actions of speculator William Duer, who borrowed loans to do business until he realized he could no longer borrow.