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Finance: What is the 1934 Securities And Exchange Act? 14 Views


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Description:

What is the 1934 Securities Exchange Act? The 1934 Securities Exchange Act brought about the SEC, or the Securities Exchange Commission. This act, and the SEC, monitor and govern all realms of the financial world to ensure fair practice by all parties involved.

Language:
English Language

Transcript

00:00

Finance a la shmoop what is the 1934 Securities and Exchange Act? okay if

00:09

you're going to exchange securities like trade stocks and bonds among yourselves [Stocks and bond exchange between man and woman]

00:14

well then there have to be rules right yeah you'd think well there didn't used

00:18

to be and then aunt 1934 came along and well she set the table the key element [Aunt setting dinner table]

00:24

that 34 Act created was the SEC itself it's not a football conference near

00:31

Florida it was a wise creation because it recognized that well whatever the

00:36

world looked like in 1934 it was highly likely that 50 years later it would look

00:41

a whole lot different and while horses and buggies went away [Horse and carriage disappears]

00:45

while that wasn't the case for stocks and bonds and keep in mind that another

00:50

Act was created a year earlier cleverly named yes the Securities Act of 1933

00:56

while that act focused on primary shares that is original shares like the kind

01:02

sold in an IPO well the 1934 Act was all about shares

01:06

traded after that initial set it's called the secondary market where

01:11

secondary shares are traded not primary ones well this new law made the New York [Group of people dealing in stock market]

01:16

Stock Exchange a big deal with big powers and made insider trading illegal

01:22

and believe it or not it really wasn't illegal back then and it you know thus

01:26

paved the way for many exciting Wall Street movies where greed is sometimes

01:31

good and sometimes not [List of Wall Street movies]

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