The work of the Stock Exchange

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Monograph

Identifikator:: 1831284952

URN:: urn:nbn:de:zbw-retromon-225876

Document type:: Monograph

Author:: Meeker, James Edward http://d-nb.info/gnd/126597340

Title:: The work of the Stock Exchange

Edition:: Revised edition

Place of publication:: New York

Publisher:: The Ronald Press Company

Year of publication:: [1930]

Scope:: XVI, 720 Seiten; Illustrationen, Diagramme

Digitisation:: 2022

Collection:: Economics Books

Usage license:: Get license information via the feedback formular.

Chapter

Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XVIII. The stock exchange as an international market

Collection:: Economics Books

520 THE WORK OF THE STOCK EXCHANGE closing of the New York Stock Exchange.®* As the President of the Exchange during that trying time afterwards stated :*® . . . the fundamental reason for closing the Exchange was that America, when the war broke out, was in debt to Europe, and that Europe was sure to enforce the immediate payment of that debt in order to put herself in funds to prosecute this greatest of all wars. To use an illustration popular in Wall Street at the time, there was to be an unexpected run on Uncle Sam’s Bank and the Stock Exchange was the paying teller’s window through which the money was to be drawn out. so the window was closed to gain time. Once the initial shock was spent, however, the Stock Ex- change was reopened gradually and skilfully. Trading in all securities was again permitted by the following December 15, and at once the Exchange became vitally serviceable to the nation under the new and unprecedented conditions imposed by the war. Reversal of Our International Trade Balance.—Obyvi- ously, Europe could not maintain her previous volume of exports to us, for her factories, her ships, and her capital were restricted to war production. On the other hand, the Allies soon began to purchase here enormous quantities of all sorts of raw materials and manufactured goods needed to conduct the war. The result was, of course, that our total exports soon threatened vastly to exceed our total imports. It was vitally important for the Allies to prevent such a condition in our trade, lest dollar exchange soar in terms of francs and pounds, and their purchases of war material here prove im- possibly expensive. In consequence, Europe soon began to ship us large quantities of gold to offset our impending surplus of exports. But there was not sufficient gold at her disposal to balance the account in this way, and accordingly the vast European pre-war holdings of our securities began to be sold through the New York Stock Exchange to American specu- 18 See Appendix XVIITe. 19 Noble, The New York Stock Exchange in the Crisis of 1914, p. 65.

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