53 
other countries, and directs their flow into the productive in- 
dustry of America.’® Of course, the money does not pass 
directly from the purchaser of listed securities to the manufac- 
turer, but instead, as a subsequent chapter’! will demonstrate, 
through a number of speculative hands, including underwriting 
houses. 
ORGANIZED SECURITY MARKETS 
Nevertheless, by making this process possible the Stock 
Exchange renders every day an indispensable service to the 
industrial corporations of the nation. Silently, day after day, 
week after week, year after year, this great flow of capital 
through the Stock Exchange into industry, and the ebb of divi- 
dends, interest, and profits or losses back from industry to the 
public, goes on. In the past it has spanned our continent with 
a steel network of railroad tracks—the arteries of our inland 
transportation system; it has built the vast factories and mills, 
and sunk the countless oil wells and mine shafts which have 
made this country the industrial marvel of the century. It has 
ceaselessly operated to bring forth from the inventor’s shed 
and make available for daily use by the people those inventions 
which have so powerfully contributed toward making life today 
more worth living than at any other period in history. 
7. More Intelligent Direction of Capital.—Until security 
markets were highly organized, great wastage of capital oc- 
curred through its haphazard direction into investment. The 
stock exchanges of our own times, however, have largely 
reduced such wastage by the superior market facilities which 
they have made available to everyone. When the ticker or the 
daily quotation sheet shows that prices for the securities of 
one industry are rising and those of another industry are fall- 
ing, it is usually a clear warning to the modern investor that 
capital is needed in the first case, but not in the second. Thus 
simultaneous gluts and scarcities of capital as between different 
industries are almost automatically prevented, misalignments 
between the supply of capital and the demands of industry are 
a A ppandin Joo, 116.