These institutions serve investment banks as well as private investors, constituting the machinery which connects them all. They thus enlarge the area and scope of the markets for securities, and greatly increase the mobility of capital. Without them the surplus savings of one locality would only very slowly and with difficulty find their way to other localities where they are needed, with the result that capital would lie idle or be very inefficiently employed in some places while in others natural and human resources would be undeveloped or very inefficiently developed. Existing stock exchanges differ considerably in the manner in which they are organized and managed, in methods of doing business, and in the scope of their operations. Some of them are incorporated and others unincorporated; some restrict their membership to a prescribed number, others admit as many as are able and willing to comply with the conditions imposed; some are local in their scope, some national, and others international. In this country all the exchanges deal in local securities chiefly, except the one in New York City, which is national in its scope. The London exchange does a larger business in international securities than any other, but the Paris and Berlin exchanges, as well as those located at the other important European capitals, and the one at New York share in it to a greater or less degree. Stock exchanges have suffered in reputation, and their real functions and merits have been obscured by the abuses to which they have been subjected. Connected with their legitimate business of facilitating the investment of capital, various forms of speculation have developed which in some cases have degenerated into gambling pure and simple. The better managed ones have striven to rid themselves of these abuses, and in some countries, notably in Germany, legislative bodies have taken a hand. The results, however, have proved only partially successful. Some forms of speculation are not only legitimate but necessary in modern business life, and these shade into the illegitimate, unnecessary, and positively harmful forms by such short and easy steps as to render it difficult, and perhaps impossible, to draw a line between the two which can serve as a guide for regulations of an administrative or legislative kind. _6. Some Defects in Our Investment Banking Machinery_