70 THE WORK OF THE STOCK EXCHANGE 
progressive American cities which needed gas and then electric 
lighting, local traction facilities, and telephone service. Accord- 
ingly, the thin trickle of public utility securities into the New 
Vork stock market broadened into a steady and heavy current. 
Furthermore, powerful manufacturing industries were being 
organized, both in our older eastern cities and in the new 
western centers which our railroads had created and nourished 
into prosperity. Particularly after the Spanish War, these new 
industrial companies experienced a rapid growth and tended 
to evolve into large-scale corporate units with a huge capitali- 
zation, and thus with shares and bonds to sell to the pub- 
lic through the indispensable market provided by the Stock 
Exchange.? 
The Réle of the European Investor.—As was inevitable 
in a country so new and for the time being so economically 
immature, this amazingly vast and swift development of 
American transportation, American cities, and American in- 
dustry from 1830 to 1900, completely outran the ability of 
American speculators and investors to finance it. Accordingly, 
great blocks of our railroad, utility, and industrial stocks and 
bonds were absorbed by the wealthier investors of Europe and 
were listed on the stock exchanges of London, Frankfort, and 
other foreign financial centers, as well as on the New York 
Stock Exchange. 
Even prior to the panic of 1837, the British had absorbed 
many of our early and sometimes quite unreliable state bonds, 
and later even larger amounts of the securities of our leading 
railroad corporations. After the Civil War, too, the rising 
financial nation of Germany purchased heavily into our far 
western railroads, particularly the Atchison, Northern Pacific, 
and Union Pacific railroads. It is well known that the ulti- 
mate prosperity of the northwestern “Hill roads” was largely 
founded upon heavy buying of the shares and obligations of the 
8 Appendix II1d.