The Red Cloud chief., 1884-05-30
rhe Science Of ''rrivilege" which I'm.
hOrSed keene.

Al a majority of people do not know
what sort of things stock privileges are.
it may not be out of place to say a few
words on this subject. A stock priv.
iege is = paper signed 5y some we'll
known person, and emitting the bearer
to put to, or call from. that person q
given amount of a given stock ut a
yiven price within a given time. These
privileges are paid for according to
their speculative value. their duration
and the mount OF stock they are issued
for. They are practically insurance
tickets against losses in stock gambling.
A man who buys a privilege can not
lose more than the amount he paws for
il. Ii he buysa stock and it goes down.
ne can put it to the signer of the privi-
lege. Ii he sells it short and it goes up,
ne al call it and cover his contract.
The se-called puts and calls go only one
way. and the bearer can only either put
to or call from the signer the stock cOn
cerned. The spreads and straddles
work both ways; tie holder can either
put to or call from the signer the stock
concerned. The sellers of privileges
work upon the same plan As book
makers do at the races. They sell
stocks short against their puts, and buy
them against their calls. As a rule
they make a great deal of money. for
the figures OF the privileges are usually
far away from the market. and the pre-
MUM paid for the privilege forms in
most cases 4 clear profit. The largest
dealers in privileges are Mes>rS. Russell
Sage. j.. X. keene. NJ. D. BOgart and
S V. White. Old Sage has made u
million OF two by selling privileges.
Being a director in many corporations.
is always knows which way a given
stock is likely TO 90, and sells his puts
and calls accordingly. Besides. he has
a large following. and can always make
rich people buy or sell a certain stock,
and thus protect his paper.
Mr.. Keene had the disadvantage of
not being come ted with any large cor
poratiOn, and of having no following to
speak Of. But he had a perfect passion
for selling privileges. A crisp thousand
dollar bill exhibited by = curbstOne
privilege broker was to him Ike piece
of red cloth to n bull. He could not re-
Sist the temptation to 90 for it. If ne
had confined himself to The dealing in
privileges he would probably have come
out ahead. But, being a large specu-
l.tor. besides, he was all the time Grip
pied in his movement by the puts and
calls he had out. He was probably the
most consistent, and intelligent bear
for the last two or three years, yet he
did no. dare to let the market 90 down
too far out of fear that m avalanche of
stock would come down on him. The
conquer e was that lie had t, sustain
tie market by buying stocks, and. as
prices went down Notwithstanding his
efforts, he had \ mass % Stocks pat to
him besides. That game was going on
for L long time. and he was u big io,er
at 4 all the while. His brst friends i'm
plOred him long ago to give up the priv
iiege business, and he has repeatedly
prom >ed them to do so. but the fatal
passion was there. and he could not ret
rid of it. The collapse had to come.
:.nd it came. There can be no doubt
that he will make all his outstanding
contracts good, though it will probably
take him some time to do so, hut the
n-rvOuS tension to viii h he must be
subjected at the present moment Tust
be terri bic. and there is not n man n
Wall street who knows him well who
Ices not deeply %sympa;hize with him.
He WIS ALWAYS the most open-hearted
and least tricky of the great Wall street
men. Besides. he fought al his battles
sin rle-hand1d. and some of them were
III ghty big battles. too. His pluck and
endurance are sub ects of admiral on.
even On the part OF his enemies.-N. \.
.Ss.u.