Stock Exchange 1.0 The world’s first known stock exchange is thought to be a market established in Bruges, Belgium, around 1309. This operation was a family concern conducted in the home of textile merchant Robert Van der Burse (or Van “ter Buerse/Buerze”). This type of early market which primarily deals with the exchange of commodities, ie, various agricultural products—and in its modern connotation, also with gas, oil, coal, etc—acquired the name ‘bourse’ from its founder. A bourse (typically European in location) is “a market organised for the purpose of buying and selling securities, commodities, options and other investments” [‘Bourse’, Investopedia, www.investopedia.com]. Another early bourse was located in Antwerp<a̷>.
𝕍𝕒𝕟 𝕕𝕖𝕣 𝔹𝕦𝕣𝕤𝕖: 𝕥𝕙𝕖 𝕠𝕣𝕚𝕘𝕚𝕟𝕒𝕝 𝕓𝕠𝕦𝕣𝕤𝕖
The Van der Burse exchange was the first organised market, before this landmark development such transaction processes were unorganised and informal – sellers and buyers would meet up one-to-one at specific meeting places such as town squares to conduct their trade <b̷> [‘Creation of the first stock exchange’, www.citeco.fr].
The Dutch, pioneers of capitalism
For the first ‘modern’ securities market we need to look to Belgium’s neighbours, the Dutch. The Amsterdam Stock Exchange is the oldest such market, founded in 1602 with the establishment of the Dutch East India Company (Verenigde Oostindische Compagnie or VOC). Amsterdam was the first bourse to deal in securities <c̷>. The VOC was empowered with quasi-government and monopoly status by the States General of the Netherlands, granted a 21-year charter to conduct all Dutch trade in Asia. In so doing, financial history was made…the VOC was a world first, a public company founded by a state government. Hitherto the Dutch trading environment comprised a number of competing private companies known as voorcompagnieën or “pre-companies”. By the 1602 Charter, the government merged those small, private companies into one “nationalistic Goliath”, VOC, creating a proto-megacorporation.
𝟙𝟞𝟘𝟚 ℂ𝕙𝕒𝕣𝕥𝕖𝕣 𝕕𝕠𝕔
Raising capital
At VOC’s commencement of business it held an unprecedented initial public offering (IPO). The company’s directors opened up share-holding to all Dutchmen by subscription (while investing 12,000 guilders of their own money up front). The public nature of the share issue was its revolutionary feature, hitherto predecessor companies (like the Oude Compagnie) had raised capital from a small circle of private investors. Some investors balked at the opportunity offered by VOC, wary of tying up their precious savings for such a long period (ten years). Concessions made by the VOC eased these concerns – in a subsequent amendment to the charter, investors were permitted to on-sell their shares to a third party prior to ten years [‘The world’s first IPO’, Lodewijk Petram, The World’s First Stock Exchange’, 15 October 2020, www.worldsfirststockexchange.com].
𝔸𝕞𝕤𝕥𝕖𝕣𝕕𝕒𝕞𝕊𝕥𝕠𝕔𝕜𝔼𝕩𝕔𝕙𝕒𝕟𝕘𝕖𝕒𝕟𝕕𝕓𝕦𝕝𝕝
What would NOT have seemed novel to financial market investors of the day was the ‘office’ for doing business…initially lacking a business premises the VOC—after the fashion of the Bourses’ 14th century Bruges exchange—issued an open invitation for would-be investors to come to the private home of the company co-founder Dirck van Os to do the paperwork and deposit their money. Ultimately, by the time subscriptions closed, some 1,143 individuals <d̷> had invested a total of 3,674,945 guilders in the Verenigde Oostindische Compagnie (including Dirck van Os’ own maid!) [Petram].
ℕ𝔸𝕊𝔻𝔸ℚ (ℙ𝕙𝕠𝕥𝕠: 𝕄𝕒𝕣𝕜𝕖𝕥𝕤𝕎𝕚𝕜𝕚)
Footnote: the VOC’s IPO had profound ramifications, fundamentally altering the nature of investing. Originally intended to facilitate the financing of risky capital-intensive ventures, it “inadvertently created an alternative for investor beyond fixed income investments, marking the beginning of retail investing in equities” [‘World’s First IPO: Dutch East India Co’, Suede Investing, www.suedeinvesting.com].
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<a̷> the most famous bourse today is that of the Paris Stock Exchange
<b̷> including the square in front of the Van der Burse residence
<c̷> printed stocks and bonds, debt and other interests in companies, government and private businesses
The earliest European explorers of Australasia (Australia and New Zealand) seem to have been the Dutch¹. History records a host of Dutch mariners and navigators, in the service of the bodaciously powerful VOC (Vereenigde Oost-Indische Compagnie), the Dutch East India Company – the “Microsoft of its day” as John Birmingham described it². These seafarers voyaged to the unknown southland known as New Holland and explored parts of it during the 17th century❈.
Nouvelle Hollande on a 1681 globe of world
The multiple presence of Dutch seafarers in the oceans of the Southern Hemisphere in the 17th century is reflected in the maps of early cartographers, especially in the nomenclature. New Zealand derived its name from the province of Zeeland in Holland, in Latin Nova Zeelandia, Dutch, Nieuw Zeeland, (‘Zeeland’ was later modified to ‘Zeland’ and then finally to ‘Zealand’). Nomenclature in Australia has distinct associations with the Netherlands – the continent was previously known as “New Holland” (Lat: Hollandia Nova, Dut: Nieuw Holland); Both Tasmania’s present name and its previous name (Van Diemen’s Land) bear the mark of Dutch exploration回.
Willem Janszoon’s venture to the eastern side of Australia (today’s North Queensland) to search out new trading outlets did not yield any success on this count. Moreover Janszoon found the land swampy and the indigenous people inhospitable and threatening³. Although many Dutch explorers visited the West Australian coast in the two centuries after the first Hartog expedition in 1606, there was no real attempt by the Netherlands to establish a colony in New Holland. The Dutch were deterred by the poor prospects (as they saw them) for farming, eg, apparent lack of water and fertile soil. Ultimately though, the crucial factor in dissuading the Dutch from launching into colonising or settling part of New Holland was the (apparent) complete absence of trade in the land⁴.
Could there have been impromptu Dutch settlements in Western Australia in the 17th and 18th centuries?
Its possible … in this era a number of commercial VOC ships on route to or from Batavia (the East Indies capital) were known to have been wrecked off the western coast of Australia, usually caught up in the treacherous “Roaring 40s” winds (between 40˚ and 50˚ longitude), most famously associated with the Batavia wreck and mutiny in 1629. This has led to conjecture that some survivors (including mutineers) could have settled in the country after integrating into local aboriginal tribes⁵.
Sweden does not come to mind as a coloniser on a world scale as readily as some of the more conspicuous imperial powers. But under its ambitious monarch King Gustav III, it embarked on a foray into the colony business in the 1780s※. By 1784 it had acquired a colony in the West Indies, Saint-Bathélemy, from France, and was looking further afield. A prospect in West Africa, in Goree, Senegal, was investigated but proved unfeasible. About the same time as Gustav was eyeing off unclaimed parts of the globe, Britain was making plans for its penal colony in Botany Bay. In 1786 the Swedish king engaged William Bolts, a Dutch-born merchant and adventurer. Bolts had earlier been in the employ of both the British East India Co and the Austrian East India Co (the Ostend Company) and so had extensive commercial connexions in India. The plan was for Bolts to locate and found a Swedish colony on a suitable island in the “Eastern seas” (a trading base for the SOIC).
Seal of the Swedish East India Co (SOIC)
Bolts took his inspiration for the venture from a well-known, early 18th century publication by Jean Pierre Purry, proposing to colonise “the Land of Nuyts”. Purry speculated that a unspecified land with a latitude corresponding to that of New Holland “might contain richer mines of Gold and Silver than Chili (sic), Peru, or Mexico”. Purry advanced the view that a latitude of between 31˚ and 33˚(North or South) was highly propitious for the cultivation of vines, fruits and plants. Purry later put his theory into practice in the eponymous South Carolina township, Purrysburg (32.3˚N)⁶.
Under the terms of Bolts’ convention (contract) with Gustav III he would take possession of the WA island in the name of the Swedish crown. Bolts would be governor for life of the settlement which was to called ‘Boltsholm’. Bolts’ scheme for the Southwest Australian colony was to use it as a base to trade with the Nawab of Sind (now ‘Sindh’ in Pakistan, formerly southwest India) where he would set up a trading factory. Boltsholm would also serve as a place of refreshment for Swedish merchant ships on the way to the East Indies and China. He also envisaged it could become a free port in time of war between European powers whereby Sweden could handsomely profit by trading with both sides. Bolts refused to disclose ‘information’ publicly as to the site’s precise whereabouts, simply saying that the land would be suitable for plantations producing silk, cotton and sugar⁷.
Notwithstanding Bolts’ vagueness as to the island’s location and some of the royal ministers’ financial objections to the plan, Gustav contracted Bolts at a salary of 3,000 Rix dollars per annum plus a share of profits on any minerals or precious stones discovered. Despite this nothing happened for several months until March 1787 when Gustav suddenly postponed the project for a year, concerned at the prospect of a new European war. When war materialised between the Russian and the Turkish empires, Gustav spotted an opportunity to regain lost Baltic territories and invaded Russia. Gustav then postponed the New Holland expedition indefinitely, releasing Bolts from his contract and recompensing him with £250⁸.
King George Sound, WA
Bolts tried to reanimate Swedish interest in the project, reminding the ministry that the English had consummated their plans to establish a settlement in Botany Bay. He also pitched a revised plan for the colony to the King’s chief adviser proposing a joint venture with the Kingdom of Sardinia … but to no avail. Bolts moved on to new (and equally unsuccessful) ventures and the idea of a Swedish colony in New Holland remained unrealised.
PostScript: Le vieil ennemi de la Grande-Bretagne
A third player in the regional imperial stakes was believed to harbour designs on New Holland as a colony – France. In the 1780s rumours circulated in the US, Britain and elsewhere in Europe, of French intentions in the light of a scientific expedition by the Comte de Lapérouse … to doubting minds the real reason for the expedition in the south seas was to prepare for a French colony in New Holland (a base in handy reach of the lucrative East Indies trade)⁹. Western Australia remained devoid of European settlements until well into the 19th century. After surveyor Jules de Blosseville reported to the French government on the suitability of south-west WA as a penal colony for France (perceived as a “possible panacea for a number of ills in France at that time”)◑, the Admiralty in Whitehall instructed the New South Wales governor (Brisbane) to establish an outpost, Fredericktown (Albany) in King George Sound in 1826. The perceived threat from France saw the British consolidate its hold on the West by establishing a permanent settlement on the Swan River (Swan River Colony later Perth) in 1829¹⁰.
The VOC’s routes to the East Indies
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❈ Australians and New Zealanders are familiar with the names Dirk Hartog (Dirck Hatichs), Abel Tasman and Antonio van Diemens, but probably less conversant with that of Willem Janszoon, Hendrik Brouwer, Frederik de Houtman, Frans Thijsz (or Thijssen) and Willem de Vlamingh
回 many different names have been attributed (or misattributed) to Australia – the Great Southern Land, Terra Australis (or Terra Australis Incognita), New Holland. Sweden referred to it as ‘Ulimaroa’ (corrupted from a Maori word). Late 16th century Flemish and Dutch mapmakers confused ‘Beach’ or ‘Boeach’ (to identify the northernmost land of Australia) with Marco Polo’s gold-rich ‘Locach’, a term Polo used to refer to the southern Thai kingdom. The Travels spoke of a southern land to the south of Java called La Grande isle de Java, (or Jave la Grand) which Polo described as “the largest island in the world”, providing inspiration for later explorers of New Holland. A Spanish expedition led by de Queirós landed in the New Hebrides (today Vanuata) in 1606, thinking it to be the southern continent, named the land “Australia del Eśpiritu Santo” in honour of the Spanish queen. The same year Hartog exploring the Australian west coast named it “Eendrachtsland” (after his ship!). Frans Thijsz on exploring the southwestern part of the mainland (near Cape Leeuwin in WA) named the continent “Land Van Pieter Nuyts” (AKA “Land of Nights”). Janszoon, first known European to see the Australian mainland, chartered 320km of the coastline in the Gulf of Carpentaria, naming the land “Nieu Zeland”, fortunately the name was not adopted and later applied by Abel Tasman to the two islands across the sea from Australia. New Zealand echoed some of the misunderstandings surrounding Australia’s early discoveries – Tasman on finding the South Island of NZ originally called it “Staten Landt” because he was under the misapprehension that the island was connected to Staten Island at the southern tip of Argentina! ‘European exploration of Australia’, (Wiki), https://en.m.wikipedia.org/wiki/european-exploration-of-australia; ‘Abel Tasman’, (Wiki), https://en.m.wikipedia.org/wiki/abel-tasman ※ there had been an earlier Svenska kolonier phase (1638-63) with colonies in West Africa (Swedish Gold Coast) and Delaware (New Sweden)
◑ France eventually established its version of Botany Bay in the region – a combination of penal and settler colony – in New Caledonia in 1853
❄ ❄ ❄
¹ although over the years several other rival claimants have been advanced as the first foreign visitors to stumble upon the continent, including the Portuguese and the Chinese, see KC McIntyre, The Secret Discovery of Australia: Portuguese discoveries 20 years before Captain Cook; G Menzies, 1421: The year China discovered the world
² J Birmingham, Leviathan: The Unauthorised Biography of Sydney, (1999)
³ Janszoon somehow missed the straits which separate the Australian mainland from New Guinea, unlike the Galician and Portuguese mariner Torres a few months later (today known as the Torres Straits). Dutch cartographers, relying on Janszoon’s reports, for decades after erroneously drew maps showing New Guinea and Australia as a one great land mass, ‘Willem Janszoon’, (Wiki), https://en.m.wikipedia.org/wiki/willem-janszoon
⁴ The main focus of Janszoon, Tasman and other Dutch explorers was mercantile, finding tradeable commodities within the Australian continent, ‘Janszoon’, ibid.;’Dutch Origins: The Part played by the Dutch in Western Australia’, www.indigitrax.org.au
⁵ ‘Dutch Origins’, ibid. Blood group correlation of members of the WA Amangu tribe with Leyden in Holland add weight to these arguments, ‘Batavia’, (Wiki), https://en.m.wikipedia.org/wiki/batavia
⁶ Lands of true and certain beauty: the geographical theories and colonization strategies of Jean Pierre Purry, JP Purry / AC Migliazzo; Robert J King, ‘Jean Pierre Purry’s proposal to colonize the Land of Nuyts’, (Apr-2008), www.australianonthemap.org.au
⁷ RJ King, ‘Gustav III’s Australian Colony’, The Great Circle,(online), Vol 27, No 2 (2005)
⁸ ibid.
⁹ ibid.
¹⁰ LR Marchant, ‘Blosseville, Jules Poret de (1802–1833)’, Australian Dictionary of Biography, National Centre of Biography, Australian National University, http://adb.anu.edu.au/biography/blosseville-jules-poret-de-1799/text2041, published first in hardcopy 1966, accessed online 31 August 2016.
𝟙𝟞𝟘𝟚 ℂ𝕙𝕒𝕣𝕥𝕖𝕣 𝕕𝕠𝕔
𝔸𝕞𝕤𝕥𝕖𝕣𝕕𝕒𝕞 𝕊𝕥𝕠𝕔𝕜 𝔼𝕩𝕔𝕙𝕒𝕟𝕘𝕖 𝕒𝕟𝕕 𝕓𝕦𝕝𝕝
Willem Janszoon’s venture to the eastern side of Australia (today’s North Queensland) to search out new trading outlets did not yield any success on this count. Moreover Janszoon found the land swampy and the indigenous people inhospitable and threatening³. Although many Dutch explorers visited the West Australian coast in the two centuries after the first Hartog expedition in 1606, there was no real attempt by the Netherlands to establish a colony in New Holland. The Dutch were deterred by the poor prospects (as they saw them) for farming, eg, apparent lack of water and fertile soil. Ultimately though, the crucial factor in dissuading the Dutch from launching into colonising or settling part of New Holland was the (apparent) complete absence of trade in the land⁴.
