Savannah morning news. [volume] (Savannah) 1868-1887, 1881-03-17
PROFITS OF BROKERS.
Some of the Ways I'm which Money
is Made I'm Wall street.
Ne1p York Sun.

Ne10 York Sln
A Wall street broker, with taste for
figures outside Of those of the stock list
Of the Exchange, or the tape of the indi-
Gator, INDUCED yesterday IN computa-
ton as to the cash value of the Elk
change and its belongings in these flush
times.
Beginning with the Exchange itself,
he said, eve have a very nice bit Of
property to consider When the en-
largement and other extensive improve
ments are completed, the Exchange will
be superb affair, and well worthy of
the enormous business that is done in it.
think that the Exchange could safely
be put down, when the repairs are made,
at fully $1,500,000. Now, we'll con-
slider the value of seats in the board.
It's all fiction, you know, about seats,
for no one has seat except the presiding
officer or a chap who Is smart enough
to slip into one of the few cushioned
arm chairs around the sides of the room,
which are usually mOnopOlized by the
old fellows who can't stand the pum-
melting, pushing. showing and climbing
in the centre of the room as well as they
could few years ago. Well, a seat is
now worth $50, 900, cash or check.
There are about 100 seats, worth, in
round numbers, .$35, 200, 600. No indi-
vidual can own, or at least use, more
than one seat. The same rule applies to
firm. One member of the firm is
usually spoken Of as the member who
goes into the board The privilege may
be delegated to a confidential clerk. Just
to show how valuable seat is as mat
ter of investment, I'll tell you little
story. A young clerk worked hard and
saved his money. When seats were
worth less than S., 900, and that is not
great many years ago, he bought seat.
A firm that had just been organized of.
fered him a round sum year for the
use of his privilege. He accepted the
offer, being nominally member of the
firm, but really only entitled
to the income from his seat.
He was transformed at once from an
lily paid employe into young gentle
man of leisure. Some years ago, when
the silver mining excitement broke out
in California, he went there, but his in
come was regularly RENTED. The firm
has grown to be big one, but it prefers
not to change the old arrangement. The
young man, having an assured income to
back him up, has prospered in California
and bids fair to be very rich man. In
fact, even at the present price, there is
no better investment for money than a
seat in the board, provided that the in
weston is a man of agreeable manners,
and has knowledge of the ways of the
street, or associate himself with a man
uuhn hos &c i'm hoh ln hot no
price of seat will rise, within the year,
to $780, 900, if the tide of general pros
perity continues to strengthen. for the
volume of business transacted daily upon
the exchange is tremendous and is steadi-
lY swelling. Why, day when 500, 900
shares of stock are sold and bought is an
average day now. The commissions on
this buying and selling are $25 for every
100 shares, or $4,000 for the days
BUSINESSMAN average of more than 500
a day apiece to the /, 100 brokers.
"Why, I'll tell you something that
very few people know, and that is that a
broker who has fair business relies
upon his interest account alone to pay
his whole Office expenses. Russell Sage,
probably the largest operator in stocks
in the world, the boys tell me, expects
them to divide their commission with
him when they drop in for dicker over
a privilege, and that this little side
speculation braces him up for all his
business expenses. So, you see, the
commissions in a well regulated Office
are clear profit. By the interest account
in brokers' Office l mean the percent
age that a broker usually charges for
carrying your stock for you until you
are ready to sell out, or to get sold out,
if your margin runs down too low to
make the brokers' commission and inter-
est sure thing. The bank are very liber-
al in their discounts to members of
the exchange. A broker can get money,
as a rule, even in tight times, at a rate
that leaves him considerable margin of
profit in charging interest to the custom
er. A good many firms, of course, don't
charge any interest, but that is because
their profits from commissions are so
large that they don't care about such a.
trif1e as the interest on the money tha'
they pay for the stock they buy for a
customer. Those are the kind of brokers
who have customers who buy and sell
25, 600 shares of stock in a day, without
getting within gunshot of the limit of
their capital. know of one such house
that has customer who not only keeps
up stiff margin, but lends the firm his
check for a million or two whenever
they want to even up their heavy stock
account at the close of trying days
business.
"Then, too, every member of the board
is good for $4,000 worth of life insur-
ance if he is in good standing in the ex-
change at his death. That means simply
if he is a member, for we don't try to
void life insurance down here as they do
in some palatial structures in Broadway,
where the uncontested payments to the
survivors of policy holders are the least
item in the enormous aggregate of re-
ceipts and expenses, upon any techni-
cality. Upon the death of member,
every living member is assessed $40.
That pays $4,000 cash and no fooling,
and leaves margin that goes into sur
plus insurance fund that has already got
to respectable proportions The money
is paid over by a special committee to
the widow, or nearest of kin, ordina-
rily, within three days after the
death of the member. So, you see,
membership in the exchange, with the
sense OF partnership IN great number
of millions of dollars worth of property
and daily business, the splendid oppor-
tunities, granting the possession of a
clear and well-balanced head and
steady nerve, of making a large income,
and the certainty of the payment of a snug
sum to ones heirs after ones death, is
neat thing. Judging from my own expe-
rience and that Of my friends, there is
nothing neater, for, with skillful man
agement, broker may get along with
very little money besides that which his
customers put up as margin. The profits
of turning over 100000 shares day are,
of course, not equally divided among
the brokers. But the small fry have
better show in Wall street, probably,
than anywhere else in the world
because the rate of profit for brokers'
services is fixed, and the broker who
makes 100000 year gets no more for
handling 100 shares than the broker
whose income is only $4,000. All de-
ponds upon customers. They are allured,
though they are men, as a rule, by at
tractive surroundings as well as agree
able manners. This is getting to be well
understood rnr opd on gro IF Ipxr,rxy ",