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 XII. Comparison and security clearance

Collection:: Economics Books

324 THE WORK OF THE STOCK EXCHANGE amount, or price of their transaction, the Stock Clearing Cor- poration refuses to act for them in clearing and settling it; the transaction is removed from the Corporation’s clearing records, and. declared “ex-Clearing House.” Unless the parties to it can agree as to the terms of their contract, the case may be adjudicated by the Arbitration Committee, and in case of ap- peal from the latter's decision, by the Governing Committee. Meanwhile, the differences arising from the disputed compari- son are reduced to money amounts by “purchase, sale, or mutual agreement.”’** But in case no such disagreement occurs, all exchange tickets must be promptly delivered to the Distributing Depart- ment by 4:20 at the latest, in order that the firm to whom they are being sent can in turn send them to the Night Branch with its “Night Sheet.” Somewhat more latitude is allowed with tickets for non-cleared securities, yet these too must be ex- changed in time so that the Day Branch can in turn receive them the next morning in good season. Tardiness by members in these matters is subject to fine by the Stock Clearing Cor- poration. The time schedule applying to these processes has in recent years been more difficult to establish with exactitude owing to the increasing volume of business.” By this process of comparison, all Stock Exchange trans- actions are checked by both parties to them, and preparation is made to afford to the Stock Clearing Corporation evidence of agreement as to their terms. Thus the first act of the settle- ment process is concluded, and the stage is set for its second act—that of security clearance. Theory of Security Clearance.—Although the technique and practice of security clearance usually prove confusing to the layman, the theory of it is very simple. If A owes $5 to B, and B owes $5 to C, obviously both debts can be extin- guished by a single payment of $5 from A to C. Also, if A owes $5 to B, and B owes $10 to C, equally obviously all will "14 See Chapter XVI p. 454

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