Magdeburg Stock Exchange

First Founding 1824

The impetus for the foundation of the exchange belonged to the Magdeburg Oberburgermeister August Wilhelm Frank , who turned to the city’s merchants in 1820 and pointed out the importance of such a market to securities trading for the regional economy

On March 12, 1824 , the decision was made to found the Magdeburg Exchange in a house on Alten Markt. On March 16, the first exchange meeting took place. No further meetings were held, due to the economic disadvantage of the exchange

Second Founding 1843

In 1843, under the obligations of several enterprises and others, including Karl Friedrich Denecke , the Magdeburg Exchange revived. The exact revival date is August 1, 1843 . Due to the lack of legal rules for conducting the exchange, there was no exchange charter .

Traded between 11.30 and 12.30. On Tuesdays and Thursdays, prices were set for grain , potatoes , oil and alcohol , as well as for shares of some enterprises. At first, stock trading was limited to the shares of the Magdeburg-Leipzig Railway ( German Magdeburg-Leipziger Eisenbahn ), the Magdeburg-Halberstadt Railway ( German Magdeburg-Halberstädter Eisenbahn ) and the United Shipping Company ( German Vereinigtenhagnes-Dampfs ) . Later, regional shares of the Magdeburg Private Bank ( German: Magdeburger Privatbank ) joined the auction . They also traded in gold .

On January 19, 1863, an exchange charter was issued prohibiting women from participating in the exchange. Also, people insolvent or declared bankrupt did not have access to the exchange. Others, in order to gain access to the exchange, had to purchase an exchange card. A significant part of the exchange events did not take place in the building on Alter Markt 5-6, but on the street between them. ^[1] In 1868, the police chief, in order to eliminate traffic obstructions in this section, was forced to prohibit such assemblies under the threat of a fine of 1 thaler . This problem was finally settled only in 1872, when all the meetings passed to the first floor of the building. Supervision of the exchange was carried out by the senior team of merchants of the city.

The exchange had a clear take-off after the Franco-Prussian war in 1870/71. Repairs were paid from France to Germany , which caused economic recovery in the Magdeburg region. To this was added relief under the legal prerequisites for the formation of joint-stock companies . The Magdeburg Stock Exchange has benefited tremendously from these favorable events.

However, already in 1873 it came to the so-called collapse of the founders, accompanied by bankruptcy and a sharp drop in the rate. Magdeburg Stock Exchange has lost all its importance

Sugar Trading (Sugar Exchange)

Magdeburg, engaged in the manufacture of sugar from sugar beets cultivated here, has become a significant center of the European sugar industry. The sugar trade has gained particular importance since 1875. In 1876, sugar was listed on the Magdeburg Exchange. Along with Paris and London , the Magdeburg Exchange has gained a leading and international status in this industry. While London and Paris produced sugar from sugarcane brought from the colonies, Magdeburg was engaged in the production of sugar from beets. With the growing importance of the sugar trade, other products began to fade into the background. Although until 1895 these products were listed in official quotes, but in fact all trade in agricultural products and raw materials was limited to sugar and grain. Since 1883, the rate of sugar began to be established daily.

In 1885, several Magdeburg companies founded the German Union for the Export of Sugar to Magdeburg ( German: Deutschen Zuckerexportverein zu Magdeburg ). It was led by Berhart Lippert and Hermann Reichardt . The union has established a futures exchange for sugar products on the Magdeburg Exchange. The first official quotation for sugar prices occurred on August 2, 1886. The Magdeburg Sugar Futures Exchange was founded before the founding of the corresponding futures exchanges in London or Hamburg .

Sugar dealers sought to become less dependent on the global market and its fluctuations. Sugar was sold even before its production at a known price.

Due to the large number of speculative operations, the sugar exchange ( German Magdeburger Zuckerkrach. ) Collapsed , after which, following the model of Hamburg, a liquidation fund was created ( German Liquidationskasse. ).

The Magdeburg liquidation cash desk was formed as a joint stock company with fixed capital of 3 million DM and was engaged in derivatives transactions.

The growing importance of the Magdeburg Exchange led in 1885 to plans to build a new building specially planned for the exchange. A plot of land was provided for building on the then Emperor Wilhelm Square ( German Kaiser-Wilhelm-Platz ) (today's University Square ( German Universitätsplatz )).

In 1886 and 1887, participants in the Berlin and Hamburg exchanges tried to pull the Magdeburg sugar trade towards themselves. Initially, based in Magdeburg, the union of the German sugar industry had the support of Berlin. However, the Magdeburg Commission, led by Friedrich August Neubauer , which also included Otto Pilet and Wilhelm Zugschwerdt , was able to keep the profitable Magdeburg Exchange in their hands. The Commission concluded that the strengthening of the Magdeburg Sugar trade required the construction of new warehouses in order to provide large storage capacities and, in particular, to oppose Hamburg. Also acting as investors, members of the procurement team: Otto Hubbe , Wilhelm Hauswaldt and Max Dürr provided in 1888 funds for the exchange, which were spent for construction, in the new trading port of Magdeburg, 2 large new sugar stores

In 1996, a new exchange law came into force. He banned the trade in grain and flour. For derivatives transactions lists were introduced. In Magdeburg, the stock exchange charter has also been redone. The grain exchange has disappeared, and exchange supervision has intensified.

Formally, she could only deal with sugar trading. The remaining trading activities were conducted only through securities. But trade in cane sugar or refined sugar was not subject to the stricter instructions of the new exchange law

Nevertheless, in particular, the introduction of lists led to a distinct decline in trade volume. Lists were canceled only in 1903 after updating the law

At the beginning of World War I there was a ban on export for sugar. All completed urgent sugar transactions were canceled. The sugar exchange, along with the previous trade, was suspended. After the end of the war, due to reparations, there was a steady long-term centralization of the economy, but it did not come to the resumption of exchange trading.

Revitalization after World War 1

In 1921 the first exchange-like meeting took place in Magdeburg. The increasing industrialization of Magdeburg has enhanced the economic importance of the city without sugar trading. February 20, 1923 in Magdeburg, due to the overload of the Berlin Stock Exchange, the official stock exchange reopened. 68 securities, of which 30 belonged to joint-stock companies, were sold officially. Exchange-like meetings were held for grain, groceries and domestic products. And in August 1923, the official commodity exchange and bread exchange were founded. In 1925, after changes in tax law, the sugar futures exchange was re-founded, with quotes occurring exclusively for white sugar. At the same time, the sugar futures exchange was restored on the Hamburg Exchange.

Decline

Later, the Magdeburg Exchange began to lose its importance among other large German exchanges. In particular, the turnover of the sugar futures exchange declined, and during the Second World War it suspended its activity. The building used by the exchange on Alter Markt was destroyed in an air raid. In the GDR , to which Magdeburg began to relate after the war, the exchange was not restored.

• Helmut Asmus, 1200 Jahre Magdeburg, 1848 - Gegenwart , 3. Band, Magdeburg 2005, Seite 287 f. - Helmut Asmus, 1200 years old to Magdeburg, in 1848 - the present , 3rd edition, Magdeburg in 2005, page 287.
• Jörg Eberhardt, Thomas Mayrhofer, Jahresbericht 2001 des Studentischen Börsenvereins Magdeburg eV , Magdeburg 2002 - Jörg Eberhardt, Thomas Mayrofer, Magdeburg eV Student Exchange Union Annual Report 2001. , Magdeburg 2002