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.

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter II. Organized security markets and their economic functions

Collection:: Economics Books

ORGANIZED SECURITY MARKETS 57 also are usually affected profoundly, although more slowly, by an abundance or a scarcity of capital. But in this respect it is not unlikely that prices on the New York Stock Exchange are not today as sensitive to future business conditions as they formerly were. As long as the United States was a debtor nation, prices on the New York Stock Exchange were extremely sensitive to the influx or outflow of gold, and to every other important shift in the credit situation. More recently, however, the creditor status of this country, by practically obviating the old-fashioned credit shortage in Wall Street, has undoubtedly lessened the forecasting value of Stock Exchange prices, and has sometimes permitted them to remain stable or even to rise before and during a period when average company earnings fell, because excess capital seeking investment outweighed the poorer prospect of an increase in the value of equities. Thus, it is less safe today to indulge in dogmatic statements as to the inevitability of the barometric value of Stock Ex- change prices, than it was a decade ago. Nevertheless, with all these qualifications, as a rule Exchange prices still tend to forecast future business conditions. Moreover, a certain num- ber of business men presuppose that they always do and some- times guide their business policies accordingly—a fact which to that extent tends actually to increase their barometric value. Social Dangers of Organized Markets.—The principal, if not the only important social danger arising from the evolution of organized security exchanges, lies in just the high degree of perfection to which their facilities have been developed and made available to the public. In this, as in so many phases of American life, it may be that economic and mechanical progress has proved more swift than the social, moral and educational development necessary to adapt our daily lives to it. Anyone can, of course, speculate wildly in second-hand overcoats or tomatoes or almost any other article, as well as in securities. But it is not as easy to do so, because the markets for such articles are not as organized and readily accessible. It is the

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