The sun. [volume] (New York [N.Y.]) 1833-1916, 1898-01-30
PROHIBITED ARB1TRAGE.
FOREIGN DEALINGS Az RIGHT,
DOMESTIC FORBIDDEN.

a largo Number ur stock Exchange New
bcrs Fall to see the Point ana the Pro-
hibitory Law Is likely 10 ne tho Principal
Hssuo at the Annuai Eicction In SIny Nrat.
The text Of tho resolutions. directed against
arbitrage dealings between tho New York
Stock Exchange and tho stock exchanges OF Bos.
ton and Philadelphia, adopted by the Govern,
ing Committee of the local exchange on wednes.
day last, was mado public yesterday. The ar.
bitrage business objected to represents trans.
actions based upon varying simultaneous quo,
tations for the same.stock upon two exchanges,
The resolutions are as follows:
Whereas. The so-callcd arbitrage business OF
trading between this exchange and that of any
o tSiions sii from IN Inc tbe S finor Of S sbis sx oaSea upon has s% no.
suited in practically ignoring the Commission
Resolved, That in tho Judgment of this com.
mittoe the sending OF continuous quotations,
or quotations at frequent, intervals. by mem.
Change, i i detrimental SafnsatSii 10Th TO The I'm interest crest "a and sps w rel:
fare OF tho exchange, and that any. member en-.
gaging, in such business or trading shall be
proceeded against undcr section u Of Article
NNlI. OF the constitution.
Resolved. That the Committee OF Arrange:
ments be and they hereby are authorized and
Instructed to prevent the transaction Of any
such business or trading by any member OF this
exchange, and to prefer charges against any
member engaging therein.
The new rule has resulted in much talk among
the members of the Exchange, a great many OF
whom consider It to be evidence of a very short.
sighteu policy on the part Of tho Governing
Committee. These Members do not understand
why arbitrago dealings with domestic cx.
changes should DO prohibited, while no objec.
ton Is made to tho much moro prominent arbi.
TRACE dealings with tho London Stock Exchange.
1T In known that the adoption OF the resolutions
was opposed ut the meeting of the Governing
Committee, the vote standing IL against to %
In favor OF their passage.
The resolutions were Dr9Darad and nraSfntfd
by II. Ii. Thomas, Vice. President OF the Ex-
change and Chairman OF the Committee OF Ar
rangemcnts, but not in his official capacity.
As two members of the Committee Of Arrange
ments opposed the resolutions and voted against
brought forward as committee resolutions.
Certain members Of the Governing Commit
tee who voted in favor of the resolutions say
that they did SO not because they were opposed
to the arbitrage business, but because tho Ex-
change decided two years ago to prohibit do
that tho COMMITTEES Of Arrang "SGe was un.
able to enforce this prohibition without addi.
tlonal Exchange Hesitation: Because Of this
change authorities might have all the power
required to enforce existing laws in regard to
Tho adoption of the resolutions has brought
the entire subject up again, and it will, prob
ably ably b 30 a.. the s vital Issue EIrb at the n next Ma annual q So el &c.
bers Of the Exchange have failed to discover in
been increased by tho prohibition Of domestic
arbitrage. They have come to the conclusion
that the suspension of arbitrage transactions
has narrowed the market for a number of stocks.
notably. Sugar Refining, Chicago, Burlington
and Quincy. Atchison, Reading. and the North
ket for oil OF these stocks In Boston and Phila-
aelphia. The specialists in various stocks have
suffered a considerable curtailment in their
orders. The members generally are disposed to
attach. much more Importance to this actual
loss of business than to the theoretical falling
Oft In commissions limited ut in the resolutions
adopted by the Governing Committee.