How did coins get their names?

Background: The bank and the stock market

Source of text: History of the savings book

When the first savings bank opened in Hamburg in 1778 and the first savings account was released a little later, it was primarily a social idea. "Back then there were no state welfare and pension institutions," says Thorsten Wehber, historian at the German Savings Banks Association. "Many people had no protection against unemployment, illness or old age." For the first time, the savings banks offered the option of keeping saved money safe, “that is, not under the pillow or in the house, where some people lost all their money in a fire.” But the big idea was, says Wehber, “that interest could now make more of this money. "
This turned into good business for the banks. With the income from savings, they could now also issue loans - to communities who wanted to expand their infrastructure, or to craftsmen and traders who needed the money for their own business. "That pushed industrialization quite a bit," the historian knows. "All of a sudden, railways, new roads and canals could be built."

Today, in the age of e-mail payments, ATMs for quick money and more attractive interest rate offers, the number of new savings accounts is declining, but at least: the savings banks alone still have over 62 million savings accounts.

"I got my savings account from my grandpa when I was born," says 20-year-old Nadine, who is currently standing at the ATM in the Kreissparkasse in Cologne. Two students intervene: “Of course we have a savings account. Even if it hardly makes sense in view of the low interest rates. "And what is saved for?" For vacation, or to be able to afford something special. "

Source: WDR website from October 27, 2006:

Public companies - a profitable invention

  • The first VW share

Large companies require a lot of capital. Therefore, a few hundred years ago, clever business people came up with the idea that it would be better if one didn't have the capital for one Companies would have to organize, but several would come together to form a society. In the Netherlands, for example, several spice dealers joined forces to form the "United East Indian Company". The company's aim was to ship spices from India and other distant countries to Europe on long, risky sea voyages. Here they could sell the coveted goods at a profit. Not only spice dealers, but also anyone else who was interested could participate in the company with a little money. In this way the dealers got a lot Seed capital together. They bought several large ships from them and hired ship personnel.

  • Ships of the East India Company on a trade expedition in 1614

Shared profit - shared risk!

Today many companies function like the "United East India Company", today they are called stock corporations (in short: AG). The people who participate in an AG are also called shareholders. They invest their capital in the company and get in return shares, as the shares in an AG are called.

You are right on Profit of the company involved. However, they also share that risk of business. But that was part of the idea of ​​the clever spice traders: If a ship from the "United East Indian Company" fleet sank on the open sea or was robbed by pirates, the loss did not hit a single entrepreneur. The loss spread across many shoulders.

The stock market

A share is a special certificate or also: a Security. Anyone who buys such a document from a stock corporation owns part of the Company. He is consequently involved in the success and failure of the company. If the company does well and makes a profit, the share price usually rises too. This means that the value of the share, the stake in the company, increases. If, on the other hand, the company makes losses, then the shares also lose value. The share price - and therefore you price - sinks. When a public company makes a profit and the share price rises, the company passes some of that profit directly on to shareholders. For every single share there is then a profit sharing, that too dividend is called.

  • The German stock exchange in Frankfurt

Marketplace stock exchange

People who need capital for their companies and people who have capital and would like to make more of it meet at the stock exchange. An exchange is nothing more than a large marketplace where traders buy and sell things. They don't have to be securities. For example, there are stock exchanges where farmers trade animals such as dairy cows, oxen or pigs. Coffee is bought and sold on other exchanges. Leipzig even has its own exchange for trading electricity. And there are stock exchanges on which shares are traded - for example the important Frankfurt Stock Exchange. The price at which goods or securities change hands on the stock exchange also results from the interaction of supply and demand, i.e. a high demand for certain stocks can also drive their value up. However: "the stock exchange is not a one-way street": if a company is in crisis, if its shares are no longer in demand, shares can often lose value rapidly ...

© Text: Kerstin Stoll