Yes, Detroit once had its own stock exchange.
The Detroit Stock Exchange was organized in 1907, first opening in the Dime Building. At the time, factories were popping up all over Detroit, and they needed big, costly machines to fill them.
Many of these companies weren't flush with cash, so selling stock in their companies on the local exchange to investors enabled them to raise capital to buy machines, which in turn helped turn Detroit into an industrial boom town — and the stock exchange into a thriving operation.
"For a long time, the people who wanted to invest in local companies were local," explained Steven Renaldi, 45, an investment adviser from Plymouth who has researched and written about the exchange. "It was not only Detroit people starting these businesses and working there, it was Detroiters investing in them. Communication wasn't what it was today, and so people didn't know everything there was to know about investing in companies in different regions. All the buyers and sellers were here."
For nearly seven decades, Detroiters could invest through the exchange in local and regional companies such as Sears Roebuck, Ford, Chrysler, Masco, Packard, Goebel Brewing, Kroger, Crowley Milner, General Motors, Kresge (the forerunner of Kmart), Detroit Edison, Dow Chemical and Eureka Vacuum. In 1940, there were 136 companies on the exchange.
The stock exchange moved out of its cramped Dime quarters Dec. 15, 1919, and into the Penobscot Annex.
But Detroit's economy was roaring and the stock exchange soaring, so the exchange hired the firm O'Dell & Diehl to design this sleek, modern new HQ. Ground was broken June 2, 1930, and its cornerstone placed Aug. 14, 1930.
The building H. Augustus O'Dell and George F. Diehl came up with had a definite Art Deco vibe, something newspapers declared "Assyrian revival."
The four-story structure opened March 2, 1931, but the exchange would not stay in its new home for long. A few years earlier, companies around the country were battered by Black Tuesday, on Oct. 29, 1929, a day that saw billions of dollars lost as people sold some 16 million shares. This plunged the country into the Great Depression — and saw the Detroit exchange's trading levels plummet, as well.
Just eight years after opening its new headquarters, the stock exchange defaulted on its mortgage and was forced to move back to the Penobscot Annex. The exchange would stay there until it ceased operations in July 1976.
Why did it close down? Well, it wasn't necessarily from a lack of business. At the time, the number of stocks traded on the exchange had grown to 405, although only four were exclusive to the Motor City. The others also were available on the New York and American stock exchanges.
No, the major death knell came from new regulations taking place in the securities industry. Regional exchanges were used as a way to circumvent the rules of the New York Stock Exchange, which did not allow its members to split commissions with nonmembers.
"The New York exchange, because it's a bigger market, is going to get better prices and better opportunity to fill orders to buy or sell," Renaldi explained. "But if your broker was local, he'd want to keep the entire commission for himself, and so they might steer the order toward a local exchange, even though they couldn't get you the better price. If a local broker sent the trade to New York, the New York trader would get all the commission."
On May 1, 1975, a series of deregulations would change Wall Street forever. The switcheroo, known as "May Day," saw negotiated commissions replace fixed-rate ones. This meant that splitting commissions between Detroit traders and those from out of town became redundant. There was no longer enough money to be made by keeping things running in Detroit.
And with that, the exchange voted unanimously in May 1976 to dissolve — and memory and knowledge of the once-storied institution soon dissolved with it.
But forgotten pieces of the stock exchange still exist today.
The most memorable thing on the old Detroit Stock Exchange Building on Jefferson was a stunning Art Deco relief carved by Emil Siebern of New York that featured King Croesus flanked by a wrestling bull and a bear — the traditional symbols of strong and weak markets.
Croesus (pronounced KREE-sus) was the king of Lydia, in modern-day Turkey, way back in 560-547 BC. His wealth was said to be so vast, it inspired the saying "as rich as Croesus." The story goes, his wealth came from the sands along the River Pactolus, which is where King Midas — he of "the golden touch" fame — is said to have washed his hands to rid himself of his affliction.
When the building was reduced to rubble in 1983, some of the intricate Art Deco stone panels were saved, including the massive bas relief that once stood over its main entrance.
Today, visitors to 150 W. Jefferson can see the bull and bear, still entwined in battle. Sadly, Croesus didn't survive.
Some of the other panels that once ringed the door are on display in the elevator lobbies of Miller Canfield, which occupies the upper floors of 150 W. Jefferson.