This is the only photograph ever made of the interior of the New York
Stock Exchange, the financial heart of the country. Each stock listed is
allotted to one of the posts seen on the floor, which, during a panic,
become the scene of the wildest excitement. The exchange is connected by
private telegraph wires and “ticker” wires with every important
financial center.]
How does the New York Stock Exchange Operate?
The New York Stock Exchange is typical of most American stock exchanges,
the leading ones of which are located in Boston, Pittsburgh,
Philadelphia, Chicago, Baltimore, Cleveland, Cincinnati, New Orleans,
Salt Lake City, Denver, San Francisco and St. Louis. American stock
exchanges differ somewhat in their operation from the foreign stock
exchanges, the principal ones of which are those of London, Paris,
Berlin, Amsterdam, Antwerp, Brussels, Vienna and Petrograd.
A stock exchange is really an organization of professional brokers,
which conducts speculation and investment in securities, the paper
representatives of transportation, industrial, mining, commercial and
other properties. On the American stock exchanges one broker may
specialize in the shares of the Union Pacific Railroad, for instance,
another in those of the United States Steel Corporation, and so on. Some
brokers deal particularly in “odd lots”--blocks of less than one hundred
shares--and some members, called “room traders,” speculate entirely for
their own account and do no commission business for customers. The
commission charged for buying or selling is twelve and a half cents a
share, so that on the usual order of one hundred shares, the broker
receives twelve dollars and a half.
The business of buying and selling shares is done in a large room known
as the “floor.” Scattered over the floor are a large number of high
posts. Each post bears the name of the stock or stocks which may be
traded in at that post. This provision is to bring buyers and sellers in
any security together as quickly as possible. A broker desiring to buy
shares of a certain stock will go to the part allotted to that stock and
call out its name with the number of shares wished and the price he will
pay. This is his bid. Other brokers may offer the stock to him at a
slightly higher price, or his bid may be accepted at once. As soon as a
price is agreed on, each broker--the buyer and the seller--makes a
memorandum of the transaction, which is reported to the offices at once
by telephone. Meanwhile the broker also hands another memorandum of the
transaction to an errand boy, who takes the memorandum at once to the
telegraph operator, who in turn sends it out onto the little instrument
called the “ticker.”
Transactions on the New York Stock Exchange may be made in three
different ways: “Cash,” “regular” or on a “limited option” to buyer and
seller as to the time of delivery or acceptance. “Cash” means that stock
bought in this manner is taken up and paid for the same day; “regular”
transactions mean that the stock bought in this way must be taken up and
paid for by a quarter past two o’clock of the following afternoon.
Upon the outbreak of the European war, panic ensued among holders of
securities, and the stock exchanges of the world were closed to prevent
the selling of stocks at prices which would have brought ruin to banks
and other financial houses. Practically none of them were opened until
December, 1914, and then only under severe restrictions which were held
in force until confidence had returned.
How did the Term “Cowboys” Originate?
The term “cowboys” was first used during the American Revolution. It was
applied to a band of Tories who infested the neutral ground of
Westchester County, New York, stealing cattle from both parties and
doing other mischief.
It has been used of recent years to designate the skilled horsemen who
have charge of the cattle on the great ranges of the West. Many of them
enlisted in the Rough Rider regiment of the Spanish war and proved
daring soldiers.