MONEY CLEARANCE AND SETTLEMENT 403
ness will run up credits of approximately $63,855 and debits
of $58,700. If “failures to deliver” occur, these figures will
of course be altered in fact to that extent; just this, we will
suppose, occurs with the $2,700 debit item for the City of
Rome bonds, which are therefore marked as “fails” on the
record sheet. With this exception, all these contingent debits
and credits become actual debits and credits during the ensuing
day, as deliveries of securities are made.
But other items also enter the situation. Jenkins, we will
suppose, decides to clear two $100,000 loans through the Stock
Clearing Corporation; the latter pays off the principal and
interest of his old loans for him and debits him $100,016.67
for each. Later, however, two new loans are made which
result in the establishment of two $100,000 credits.
Since one loan clearance was effected between banks, and
the other between lending Stock Exchange members, the first
is entered opposite “Bank Loans” in each case, and the second
under “Memo Loans.” In addition, Jenkins & Co. has sent
securities worth $14,000 to non-member banks through the
Central Delivery Department, and has received from such banks
through it $33,246.90 of securities; these respective credit
and debit items are entered opposite “Central Delivery.”
Finally, as the result of a special clearance of “when issued”
security contracts, Jenkins & Co. obtains a credit of $5,391.91.
Thus, at the end of the day, Jenkins’ account shows total
actual debits of $289,280.24 and total actual credits of $283,-
246.91. Jenkins therefore draws his final draft against the
Stock Clearing Corporation for $6,033.33 (Figure 47); the
draft is signed by an official of the Stock Clearing Corporation
and thus the money clearance and settlement of Jenkins
account in the Day Branch for that day is completed.
Procedure with Insolvencies.—Insolvencies of New York
Stock Exchange members, and particularly of those who are
clearing members of the Stock Clearing Corporation, have
