In the west, futures trading is generally accepted to have begun in the late 19th century: in Frankfurt in 1867, Chicago in 1871, and London in 1877. But almost two centuries earlier, the rice exchange at Dōjima was operating on much the same principles. Even though those loved ones can never be replaced, I have been greatly touched by the many new people who have become part of my life. Though at this point it was still purely a commodity market, dealing in the buying and selling of physical rice, it is rather impractical to carry around even a single koku-so the actual exchange would often be of receipts for rice stored in one of the warehouses. Likewise, if you’re a farmer who has planted his yearly crop of rice, you’re in a precarious position when planning for the next year: if the price of rice goes down, you’re not going to be able to realize the current value of your growing crops, and so you’re not going to be able to buy all those things you were planning on buying with the money. Using this information, Cho­zameon buys rice from that year’s southern bumper crop.

To handle all the rice that flowed through the city, warehouses sprung up that offered to store rice in exchange for a fee, and Osaka became the place to be for anyone who wanted to buy, sell, or store rice. Cho­zameon’s warehouses are already full with the rice from his own speculation, so instead they strike this bargain: Ichi­zaemon will pay Cho­zameon 60 ryō now, and next year, if the price of rice has gone up (compared to this year), Ichi­zaemon will pay the other 440 ryō, plus 3 shō 2 of rice as interest, and receive the profits. You may recognize this as the problem that futures contracts exist to solve-if you owe a certain number of koku in taxes next year, and you don’t want a bad year for rice to make you unable to pay it, you’d be well served by buying rice futures: you pay now for the delivery of a pre­determined amount of rice on a certain date in the future, no matter what happens to the price of rice in the meantime. The trade in such bills developed into an institution which would be quite familiar to anyone used familiar with modern securities trading practices: standardized lot sizes (of 100 koku), priced via auction, of transferable contracts, recorded in an order book.

One additional valuable thing that futures exchanges provide are price signals: an auction of rice futures reveals a lot about what the participants think about the future availability of (and demand for) rice. But in the wake of Tokugawa’s unification of Japan in the seventeenth century followed an era of relative prosperity, in which demand for hard currency rapidly outpaced supply. The Dōjima rice exchange is a fascinating piece of history: this small island in the Osaka river delta was the world’s first futures exchange, in late seventeenth and eighteenth century Japan. Rice is perishable, and the amount which grows each year is heavily weather-dependent. The seller of a futures contract, who now (on the expiry date) has to deliver, could and often would deliver an amount of money equal to the spot price of rice as of that date. When this fuse burnt itself out, trading would end for the day, and the day’s closing price would be determined (typically based on the last trade of the day.) This “fuse-cord price” would then be used as the starting price the next day, as well as the price used for marking-to-market and for settling contracts linked to the price of rice futures.

Such disturbances became more and more common as time went on, and by the end of the Tokugawa period they had become the norm, eventually leading to the system’s final breakdown. One of those is how the length of the trading day was determined: Trading opened every morning at 8 am, and at that time a fuse-cord would be lighted in a wooden box. This also was a way to restrict attempts at “cornering”, “dumping”, or otherwise trading in ways that were considered manipulative: if at some point it became clear that a trader was trying to do one of those things, the rest of the traders would abandon the trading floor, making it impossible to determine a closing price and thus voiding the day’s trades, causing a reset to the status quo of the day before. Additionally, the team has invested in creating an immersive game day experience for fans. The Beatles played their first concert in the States to a crowd of 8,000 fans at the Coliseum in 1964, less than two days after their appearance on The Ed Sullivan Show. The entire trade is based on an extremely specific value, meaning one or two ticks/pips can ultimately decide the Olymp trade commission (https://encoinguide.com)’s fate.