The southern sentinel. (Winnfield, La.) 1883-1910, 1885-08-28
SPECULATION.
Dlsrcpntabfe Methods Which Lead r.
Misery and Crime.

Misery and Crime.
One of the financ,al papers published
in New York city gave. day or two
ago. q noteworthy account of the
methods of one or two of the leading
stock operators in that city. The rea-
son for this exposure was due to the
fact that the editor of the aforesaid
journal, trusting to the statements of
leading stock operator, had been led
into making investments. and advising
his friends to make them, which shortly
after proved to be exceedingly unfor-
tunate ones. The motive of the ex-
posture was, therefore, one of revenge,
but the lesson which the exposure
teaches is not on that account any the
less profitable. The daily reports of
the sales of shares in the New York
Stock Exchange supply obvious proof
that the number of those who now en-
gage in stock speculation is very much
smaller than it was three or four years
ago. The transfers are now on an av-
erage only about one-third as large as
they were IN 1881. this diminution being
due to the withdrawal from the
of small operators. who at one time
furnished the funds upon which the
large operators worked. But. in spite
of the losses Of the last three or four
years. the temptat on to make money
quick. either by buying or selling. is
still too keen not to prove attractive to
a certain number of outsiders. Those
who buy simply for investment are still
but an insignificant fraction of those
who buy or sell for quick turn in the
market. Now the point in the expos
ure which we have referred TO above
consists in the revelation that it makes
of the way in which stocks are mani
pulated.
In this particular instance, the
shares of two or three well known cor
porations are selected. and two promi-
nent operators meet together each
morning and agree to work together
in controlling these specialties. 1t is
quite probable that they will give out
in an authoritative manner that the
are bound to rise. and these opinions.
| coming from such high sources. are not
only circulated in the New York Stock
Exchange. but are telegraphed all over
the country either by spec. al wire or in
the regular press reports. Having thus
| encouraged a fictitious confidence and
brought about a more or less active de-
mand. the interested operators begin
to manipulate for decline. They SIX l.
fully feed out q sufficient quantity OF
stock to supply the demand they have
| occas oned. and when this hiss been &C.
complished they throw upon the mar
ket masses of stock for which there is
no adequate demand. and. as a conse-
quence, force the price downward with
leaps and bounds. Or, reversing their
methods, they may operate for rise
under parallel conditions. so far as the
utilizat ON of instrumentation is con.
| cerned.
Now it is apparent that those who
speculate in a small way for quick
turns are wholly at the mercy of these
operators. The rise and fall in prices
is not in the least governed by the nat
ural condit ons of business The price
of q certain stock may go up at time
when the business cond tions of the
road. on the prosperity of which its
value is based, are exceedingly precar.-
Gus. Or the market value of the stock
may go down when the railroad ha:
an encouraging outlook for the future.
Personal judgment and an intimate
knowledge of the actual condi
ton of the property are of moi
the least service in speculations
of this kind. They will. indeed, war.
rant a man in making an investment
that he proposes shall be permanent
or they might warrant a man in max.
ing an investment which he was
willing to hold on to through an in.
definite period of time, in the hope Of
selling out when the value of the
stock eventually appreciated. But tn.
is not speculation in the sense that il
is ordinarily understood. and it is no,
this species of speculation that is
greatly encouraged by stock brokers.
who, as they depend for their profit:
apon their commissions. are naturally
DESTROYS that those for whom they
deal should buy and sell as quickly
and as frequently as possible. But II
such quick turns the.novice is wholly
at the mercy Of the large manipulation.
He stands no more chance than mar
would who had been beguiled int
playing game OF poker with three o.
four Others who had arranged matters
in advance, and had either stocked tn,
cards or had agreed upon some giver
method Of procedure by which thei
victim was to be defrauded.
| 1t is these disreputable methods tina
have led to so much misery and crime
The bank officials and the trustees o
property who have from time 10 tim
been found guilty of using the fund
entrusted to their care In stock opera
tons have, perhaps. displayed ord mar,
| sagacity in making their investments
but they have had to contend. not witt
honest dealers. utwith sharpers. The,
have, 1t is true, been induced by thei
losses to use money that did not belonl
Ito them. but when their crime has beef
discovered they have been bitterly pun
ished. either by imprisonment or by tn
loss of that social standing which the,
had previously possessed. Indeed. il
a number of Instances, the victims O