Some people today say that companies, and particularly multinational companies rule the world. Many modern day projects exemplify the vaulting ambition of modern capitalism.
If the 16th century had seen the revolution in money and credit and the 17th had witnessed the rise of the bond market, the next step was rise of the joint stop limited liability company. But the ability of the company to transform our lives would depend on another innovation, the stock market.
In 1690 Amsterdam was the world capital of financial information. To finance the long and expensive wars against Spain, the Dutch had introduced the first national lotteries. To protect their merchants from dodgy clientele, the Dutch introduced the first central bank. But the one that left dent forever was the East India company.
Started in 1602 the company began in Amsterdam to gain control over the sea routes and establish trading posts.
Dutch traders had already spread out all over the world, from Manhattan island to Cape of Good hope. But it was Asia, that became the primary target of commercial Dutch expansion. The East Indies housed a variety of spices such as Pepper, Clove, Ginger, that were extremely alluring to the Europeans. They craved them not just to flavor their food, but also preserve it. The pungent aroma, became the smell of money to be made, enticing the Dutch to fetch them through Sea. The first fleets of the Dutch ships sailed on the 1st May 1598, retuned 19th July 1599.
The spice trade was so profitable, that one return trip was enough to pay for the cost of a building on an entire ship. In !602, at the instigation of the Dutch government, these various companies came together to form the United Dutch East India chartered company. The company was to enjoy a monopoly over all trade, from the cape of good hope all the way East to the Straits of Magellan, South America, pretty much half the world.
The structure of the new Entity was novel, the capital was divided...