THE STOCK EXCHANGE FROM WITHIN THE STOCK EXCHANGE FROM WITHIN BY W. C. VAN ANTWERP [Illustration] GARDEN CITY NEW YORK DOUBLEDAY, PAGE & COMPANY 1914 _Copyright, 1913, by_ WILLIAM C. VAN ANTWERP _All rights reserved, including that of translation into foreign languages, including the Scandinavian_ 31ST THOUSAND First printing, Jan., 1913. Second printing, Apr., 1913. Third printing, June, 1913. Fourth printing, Feb., 1914. PREFACE In so far as these pages reflect the thoughts of a busy stockbroker, distracted by many duties and lacking in literary skill, they have but little merit and the writer entertains no illusions regarding them. But in the many quotations from the writings of the world’s foremost economists that are here presented, and in the various legal and historical precedents cited, perhaps it is not too much to hope that this book possesses some slight value as a contribution to the vexed and vexing discussion of the Stock Exchange, and that it may serve in some degree both to dull the sharp edge of uninformed criticism and to strengthen the hands and hearts of loyal friends of a greatly misunderstood institution. The public is asked to disregard the utterances of demagogues and self-seekers and to consider facts. That done, the American spirit of fair play may be confidently relied upon. The Stock Exchange authorities have had no hand in the preparation of the work, nor does it bear their endorsement. I say this lest it be thought an official _apologia_. Had it been such, the work would have been much more skillfully done, and its value greatly enhanced. THE AUTHOR. CONTENTS Preface v CHAPTER PAGE I. The Functions of the Stock Exchange 3 II. The Uses and Abuses of Speculation 35 III. The Bear and Short Selling 71 IV. The Relationship Between the Banks and the Stock Exchange 99 V. Publicity in Exchange Affairs; Cautions and Precautions 131 VI. Panics, and the Crisis of 1907 183 VII. A Brief History of Legislative Attempts to Restrain or Suppress Speculation 223 VIII. The Day on ’Change, with Suggestions for Beginners 261 IX. The London Stock Exchange, and Comparisons with Its New York Prototype 323 X. The Paris Bourse; a Monopoly Under Government 383 Appendix. The Report of the Hughes Commission 415 Index. 447 CHAPTER I THE FUNCTIONS OF THE STOCK EXCHANGE