COMPARISON AND SECURITY CLEARANCE 343 
amount cleared about 50% represented intermediate contracts 
which (under the old “Clearing House of the New York Stock 
Exchange” or the present Night Branch) could be cleared with- 
out the need of banking accommodation. Since the banking 
accommodation needed by Stock Exchange members to settle 
their daily purchases and sales is in practice obtained by them 
on unsecured “day loans” at the banks, the operations of the 
security clearance system have greatly reduced the amount of 
these day loans regularly required, and therefore the amount 
of certified checks in which the day loans were employed by 
the brokers. 
Secondly, the security clearance system has effected a vast 
saving of time, not only through its settlement of intermediate 
contracts but also in the direction which it has given to the 
deliveries of stock balances, and the simplification it has pro- 
duced in money payments through its use of “settlement” or 
“delivery” prices. In the large stock markets since 1900, it 
would have been impossible without the security clearance sys- 
tem to have maintained the “daily settlement system” on the 
New York Stock Exchange, whereby deliveries are to be com- 
pleted by 2:15 the first full business day after the date of 
contract. Stock clearance has prevented breakdowns in the 
stock market, just as bank clearance has prevented breakdowns 
in the money market. 
A third service rendered by security clearance is the huge 
economies it has effected in labor. Indeed, the whole process 
of clearing and settling security contracts is from one stand- 
point simply a great labor-saving device, as Stock Exchange 
members would instantly appreciate were the Night Branch 
operations suddenly suspended. As in other branches of Amer- 
ican business, the security market has been able to pay its 
employees more because it has as far as possible eliminated the 
purely mechanical tasks which do not require special intelli- 
gence and aptitude—such as messenger service and routine 
clerical work. In addition, the security clearing system per-