THE DISTRIBUTION OF SECURITIES I13
exchanges is necessarily slower than in agricultural or indus-
trial products. To begin with, securities, which from the in-
vestor’s standpoint are simply the right or the assurance of
receiving an income, are to the average man a luxury rather
than an absolute necessity. All modern men must pay rent to
obtain shelter, buy food in order to eat, and buy clothing to
preserve their health. But they can get along without buying
stocks or bonds. Hence, from the standpoint of the individual,
the purchase of securities is made with surplus funds.
Since the tendencies in the stock market inevitably result
from the actions of the hundreds of thousands who buy and sell
securities in it, the factor of demand in the securities market
is perforce more variable at different times and under different
economic conditions than in the case of demand for commodi-
ties and articles absolutely necessary to the daily existence of
mankind. In consequence, securities are on the whole harder
to distribute among investors than most ordinary articles are
among consumers, and from this fact it follows that the process
of carrying the surplus of securities over investment demand in
the speculatively held floating supply involves a greater pro-
portion of many new stock issues, takes a longer period of time,
and thus necessitates a more constant and considerable amount
of financial speculation in them, than is the case with the similar
carrying, from production to consumption, of temporary sur-
pluses of other articles and commodities by speculative dealers.
Listed Securities Always Salable.—Moreover, it must be
always remembered that unlike wheat, corn, and beef, which
are destroyed through being eaten; or cotton, wool, and silk,
which are destroyed by being worn out; or pig iron, bar copper,
or lumber, whose immediate and more general usefulness is
destroyed by being fabricated into special forms, shapes, and
articles, securities are not thus destroyed or rendered unsalable
in any way by their purchasers. The investor in stocks and
bonds simply holds his purchased certificates in his deposit box,
