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 I. The evolution of securities

Collection:: Economics Books

THE EVOLUTION OF SECURITIES 21 In Europe it is quite exceptional for shares to be issued without some par or nominal value, and this was until the twentieth century also the situation in the United States. In recent years, however, no-par shares have become very prav- alent here among the major American industrial and other companies. To some extent this tendency here has provided material for controversy. Advocates of continuing the older practice declare that it is necessary to have a par value for shares in order readily to determine the amount of share capi- talization, and for other purposes. On the other hand, those who prefer the new practice declare that since shares are not as a rule repayable, such a par value is unnecessary, and also that such great disparities occur between par and actual or market values for shares through emphatic success or lack of success in the company’s affairs, that a par value only misleads the public as to the shares’ actual worth. For the purpose of this study, it is only pertinent to point out the increasing popularity of no-par shares. Of the 1,142 American share issues listed on the New York Stock Exchange on January 1, 1929, there were 604 par and 478 no-par share issues. Ordinarily, American common share issues convey to their holders a pro-rata vote in the proceedings of the company. But to this general theory there are certain qualifications in practice. Multiple-voting shares are nothing like as usual here as abroad. But since the war, American corporations have in certain cases put out double common stock issues called “A” stock and “B” stock, only one of which may possess the voting privilege. This new practice has in turn been attacked on the ground that it unfairly deprived common shareholders of their vote, and defended on the ground that few such shareholders in practice ever actually vote or care anything about voting. Common stock is of course the most fundamental of all corporate securities. Every corporation must have common stock, while it need not necessarily have bonds, preferred stocks, or other securities. Theoretically, common stock is usually

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