Daily globe. [volume] (St. Paul, Minn.) 1878-1884, 1880-11-25
BURSTED BUCKETS.
How One Of Chicago's Institutions Sue
cumbsd, While the Mourners Go About
the strset-Whsat Went so High that
They Couldn't Catch IL on the Ely.

They Couldn't Catch It on the Fly.
Chicago Times, Nov. 1871
Gambler alley is having panic of the
first magnitude. Many of the great mag
mates of that thoroughfare are failing, and
not a habitue of the place feels safe who has
his wealth anywhere but in his breeches
pocket. Only day or 80 ago Doxey's
bucket-shop suspended payment, and imme-
diately thereafter Nohes followed suit On
yesterday the Public Produce exchange, the
largest buoket-shop in the country, doing
business in the Brevoort house, refused to
meet its promises to pay. This concern is
incorporated, and has D. A. Loring for it's
president and N. o. Pope for secretary. It
has been under its present management
for three years. but prior to that was
owned by Messrs. Lawrence & Martin. The
failure is the result of losses that have been
suffered ever since the present upward
movement commenced in stocks, grain,
and provisions. 1t is claimed that the los
ses for six weeks past have teen uninterrup-
ted, and that within that period the whole
of the capital stock, 100000, and much
other money besides. has been
PAID OUT TO CUSTOMERS.
AAAO cooSSeo ~AO oiAdP'J thO AOAAAtUIC a. LILO
place where the business was transacted and
the moneys on deposit in banks. They will
probably aggregate a very small sum. The
failure of Doxey fastened this last suspen-
sion. Upon the night of Doxey's failure
the representatives of the PublicyP reduce ex-
| change called at all the newspaper Offices in
the city to direct attention to the fact that
their concern was not the one that had sus-
pended, and announced that it was as solid
as the bank of England, able to pay dollar
for dollar no matter what the stress of wealth
or. Doxey had agreed q short time before his
failure to buy all the stock deals on the books
of Pope's concern. His failure to carry out
this bargain caused 10 of $4,000 At
the time of the failure the Public Produce
exchange was short on account OF trades
with its customers, an immense amount of
grain and some thousands of shares of stock.
Moreover, the market was every moment
advancing, and there was no one among
their customers who wanted to sell. There
| was a movement on foot that invariably
proves disastrous to buckst-shops. All its
customers were acting one way, and acting
In unison with the movements of the market.
For week or ten days past the losses have
been in the neighborhood of $4,000 day.
| yesterdays failures, great many other facts
were elicited in regard to
THE METHODS IN GENERAL OF THE BUCKET.
SHOP,
and in regard to its customers, its profits,
and its losses. It owes it's existence, proba-
| bly,, to certain evils that exist in the regular
board of trade and stock exchanges. The
Garroar6 To- bot for L., he, II
| ways been UNDECIDED by the regular exchange
| In New York no sales less than 100 shares
makes quotation, and in Chicago no sales
of grain less than 5000 bushels, or of pro-
| vision lots less than $50 packages. There
are sold in the New York stock exchange
! what are called odd lots, but these sales of
less than 100 shares are always trife off the
| market rate. Besides this evil of too large
| lots, there were the too large commissions
Moreover, sale cannot always be madel on
the regular board at the ruling market rate.
Especially is this true of large lots. A GALE
| of part will affect the market, and the price
| obtained on the remainder will be trfle
"off." There are other reasons that gave
rise to the bucket-shop, but these are the
principal. From little to great these estab-
iishments grew. The one that failed yester-
day did business equal to any three Of
the greatest commission houses in Chicago.
1t handled three and half millions of mar
| gins in year. Its average transactions
were 100000 bushels of grain, 5000 pack
| ages of provisions, and from 1000 to 5000
shares of stock g day. Its telegraph bills
reached $4,000 in year; it employed four
telegraphic operators of is own, received its
messages in it's own Office, sent out and re-
ceived a thousand messages daily, and en-
| ployed force four times as large as the
largest commission house in the city.
THE PROFITS
| eff such an establishment are twofold. There
is first the regular commission, which, in it's
| self, upon business of so great proportions
as that of the concern just bursted, would
| probably make it profitable. But there is
besides the gambling profit, upon which
these establishments chiefly rely. There Is
not a single quantity that figures in the
| gamblers equation that is not used by the
bucket-shop proprietor in casting up his pos
| sible profit and loss. The old known guam
titles "that a man will not stop play while he
| is winning" and that ''the bank is bound to
win in the long rum" are as familiar to one
as the other.
"They trade upon the known fact that
| ousoiOCAo Haho Ao uoucy, Sdii d we'll
known operator to the reporter on yesterday,
in the course of conversation upon the
failure. 81 know" said he, ''that about a
year ago one of the great commission houses
in this city, as matter of curiosity, made a
| careful, tabuiated statement of the whole of
it's business with its customers between one
January and another. The object was to
see what would have been the profit; or loss
if the house had filled all the orders itself
without going on the board. The result of
the calculation showed that the firm would
have made profit of 100000 had it filed
all it's customers orders itself; that is, paid
profits when there were profits, and pocketed
the margins when there were losses. The
transactions of these establishments are all
square enough, SO far as I can see. There is
no room for fraud, and there are certain ad-
vantages to be had in trading with them.
The failure will be great boon to many of
the smaller houses, and to not few of the
large ones, too. The amount of business
done by the bucket shops is enormous"
Some of the facts regarding the
CHARACTER AND AMOUNT OF THE BUSINESS
by the shop that failed on Yesterday will be
q surprise to the majority of people. OF the
100000 bushels of grain which have been