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 V. The dangers and benefits of stock speculation

Collection:: Economics Books

STOCK SPECULATION—DANGERS AND BENEFITS 123 rather than attempt to analyze his psychology. For everyone has to think about the future, whether he be a savings bank president or a mere wagerer on horse races or prize-fights. The degree of intelligence employed has little to do with the objective character of what is done. One might spend a life- time studying race horses and make bets upon them with the greatest intelligence, and yet such money wagers would be com- pletely different from purchases or sales of goods, even though these were made very stupidly. Indeed, few of this world’s population—perhaps fortunately—are economists, and may sin- zerely think they are betting when in reality they are engaging in legitimate trade. Or the victim of a “bucketshop” may think he is purchasing shares, but if his supposed broker actu- ally fails to purchase them, the thing which takes place is only a money wager, no matter what the deluded customer may think about it. There are really three distinct processes which are usually referred to as “investment,” ‘‘speculation,” and “gambling” for want of more exact and mutually exclusive terms. The first—“investment”—consists in the placing of capital into some form wherefrom an income is expected; “speculation” — the second process—occurs when some property is dealt in with the hope of gaining a difference between buying and selling prices; lastly, the third process—or ‘“gambling”’—amounts to staking money or goods on some fortuitous event. Forgetting for a moment the inexact labels which language has struck upon these three courses of action, it is obvious that each of these processes genuinely differs from the other. The man who buys Steel shares in order to get the dividends which they will pay, is clearly doing something quite different from one who buys and sells Steel shares in order to secure for himself a profitable difference between buying and selling prices. It is still more apparent that a third person who does not buy or sell Steel shares at all, but merely stakes $10 that they will rise or fall in price is performing an even more different act. From

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