314 THE WORK OF THE STOCK EXCHANGE 
attempt to clear stocks was made by the Philadelphia Stock 
Exchange. The New York Stock Exchange was compara- 
tively slow to inaugurate a clearing system, and its original 
“Clearing House of the New York Stock Exchange” was not 
established until May 17, 1892—the centennial of the first 
brokers’ agreement from which the Exchange itself had devel- 
oped.® 
Before 1892, Stock Exchange members “compared” their 
trades by exchanging “comparison tickets,” and some members 
would for a fee themselves clear stocks for other members. 
The “Clearing House of the New York Stock Exchange” 
undertook to clear intermediary transactions in certain securi- 
ties, both as to the securities themselves and their money 
values, but it provided no means for centralized security de- 
liveries, or for any further clearance or settlement of money. 
The “Clearing House” was administered by paid managers 
under the supervision of a former standing sub-committee of 
the Stock Exchange Governing Committee. 
Establishment of the Stock Clearing Corporation.—So 
matters stood until 1920, when the continued growth of the 
New York stock market, as well as the tremendous strain upon 
American credit conditions during and after the Great War, 
rendered it desirable for the Exchange to establish further 
facilities for money clearance and settlement, in order to effect 
economies in time, labor, and banking accommodation. 
This step compelled far-reaching changes in the entire 
system, which was reorganized as the “Stock Clearing Corpo- 
ration” whose share capital of $500,000 is all owned by the 
New York Stock Exchange. The Corporation is in no sense 
a bank, but simply an agency for its members whereby the 
delivery, clearance, and settlement of security transactions can 
be effected with the maximum speed, safety, and economy. At 
present it has about 425 clearing members—all of them Stock 
Exchange firms. The Stock Clearing Corporation has a clear- 
TT 6 See Appendix XIIa.