History of TSE

History of the Kabuto-cho district

Update : Jun. 14, 2006

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"Kabuto-cho", where Tokyo Stock Exchange is located, is often used as a synonym with the securities market or the securities industry of Tokyo or Japan while being on par with Wall Street in the US or the City of London in the UK..

The following is the history of Kabuto-cho.

Kabuto-cho in the Edo era (1603 to 1867)

The Kabuto-cho district before the Edo era was a swampy area matted with thatches and seawater from Edo bay came in at high tide.

Ieyasu Tokugawa, who gained an overwhelming victory at the Battle of Sekigahara (1600), planned to build Edo castle. However, a vast extent of land was needed to build a port for large vessels carrying building materials as well as many lumberyards. Then, Ieyasu ordered military commanders across the country to level Mount Edo Kanda (Suruga-dai) to fill in part of Edo bay.


The current Kabuto-cho district was created by the reclamation conducted at the beginning of the Edo era.


Afterwards, the mansions of feudal lords who were intimate with the Tokugawa family were located around the Kabuto-cho district. There was an extensive villa owned by Makino Sanukino-kami in the neighborhood of the current Tokyo Stock Exchange. Its garden was numbered as one of the greatest gardens in Edo, the present Tokyo.

Kabuto-cho in the Meiji era (1868 to 1912)

In September 1871, the land surrounding the present Tokyo Stock Exchange was named "Kabuto-cho" after being bestowed to Mitsui and other "Zaibatsu" (Japanese conglomerates) as rewards of the Meiji Restoration (1864 to 1871). "Kabuto-cho" was said to be named after Kabuto-zuka (Kabuto Mound) which was in the villa of the Makino family in the Edo era (please refer to "History of Kabuto Shrine" for Kabuto-zuka).


While the new government set up after the Meiji Restoration introduced the system of establishing stock companies as a measure to encourage the growth of industry, it floated various kinds of government bonds including former public bonds and salary bonds to abolish feudal aspects of the economy. As trading of these public bonds became gradually active, there was rising momentum to establish trading institutions. On May 4, 1878, the government enacted a Stock Exchange Ordinance. On May 10, Eiichi Shibusawa, Younosuke Mitsui and other influential tycoons in the business circle of Tokyo applied for the establishment of stock exchanges under the ordinance before receiving a license from Finance Minister Shigenobu Ookuma on May 15. This was the birth of Tokyo Stock Exchange, Inc. Its operations were launched on June 1, 1878.


After the establishment of Tokyo Stock Exchange, the government and private sector people like Shibusawa established commercially important companies and modern limited companies in Kabuto-cho, which gave the town a new look as a business center.

Kabuto-cho in the Taisho era (1912 to 1926)

Page boys in kimono were often seen running errands for securities companies and taking sell and buy orders at Tokyo Stock Exchange, for telephones were rare in Kabuto-cho in the Taisho era.

Around 1921, however, employees gradually stopped wearing kimono as those who entered the stock trading floor were forbidden to wear kimono as a frontrunner in local shopping areas around Nihombashi.


After the Great Kanto Earthquake (1923) burnt away the whole district of Kabuto-cho including the building of Tokyo Stock Exchange, quakeproof and fire-resistant buildings went up one after another from around 1926 and Kabuto-cho was reincarnated as a completely modern town

Kabuto-cho in early Showa era (1926 to 1989) and during / after the wars

For a while after the Showa period began, Japan suffered from global depressions and the Japanese economy fell into a long running slump while repeated stock price crashes hit Kabuto-cho, making the town more stagnant.

With the Manchurian Incident in 1937, the Japanese economy was controlled under a war regime and the securities market was predominantly controlled by the government. In June 1943, 11 stock exchanges across the country were merged into a new "Japan Securities Exchange" which was a semi-governmental public organization. The aggravating war situation immediately deprived the sparkle of Kabuto-cho.


In the postwar era, the General Headquarters of the Allied Forces prohibited the stock exchange from resuming operations, however, at a corner of Kabuto-cho, semi-organizational collective transactions were started by securities companies. Kabuto-cho was instantaneously resurrected as "a town of securities".


Meanwhile, in addition to discharging a great deal of shares which were frozen after the breakup of "Zaibatsu", securities democratization and promotions took place across the nation in an effort to diffuse knowledge about securities. In April 1948, a new Securities Exchange Law which had a basic philosophy of protecting investors was enacted. On April 1, 1949, Tokyo Stock Exchange as a membership organization was finally created and its operations were resumed on May 16.

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