Democratic messenger. [volume] (Snow Hill, Md.) 1869-1973, 1904-06-11
WHAT is A BUCKET SHOPs
4 Brokerage Onlce where Orders Are
Never Executed.

- brokerage Outee W mere Oruers are
Never Executed.
President Pomroy's announcement on
assuming the presidency of the New
York Stock Exchange recently that
the governors were determined TO
maintain high standard of business
honor and discipline members guilty
Of Illicit practices. together with the
exposure. failure and prosecution Of
concerns forced out of the Consolidated
Exchange on charges of "bucketins."
has attracted wide attention. Nearly
every prominent bank in the Wall
street district has been written To by
anxious customers Of concerns whose
business methods resemble those fol-
lowed by the firms exposed. Such sus-
picions in many eases have been
groundless. but the distrust has been
universal. with the result that the bust
ness OF many reputable brokerage
houses has been seriously interfered
with. This has led 10 the question
being asked generally. What is a buck
ct shop: The query has been put by
doctors. lawyers. merchants and many
other private parties unfamiliar with
the Wall street routine.
In general. IL may be said that a
bucket shop Is a brokerage office where
orders are never executed and the
funds Of customers are frau,lulently
appropriated One OF the most sue
cessful New York bucket shops has an
extensive suit of offices. fitted up with
all the paraphernalia Of Stock Ex-
change house. Operatives appear to
be receiving dispatches over private
wires. and score Of clerks are busy
posting quotations on the bulletin
board The rooms are always filled.
and the office does very heavy bust
ness But the wires do not go outside
the building ut all. leading only TO a
basement room. from which dispatches
are sent and the fake scheme directed.
All the business Is done on n one or
two point margin. no one being allow
ed TO put up more than five points. In
that way a variety Of small customers
are reached. who deposit $40. $50 or
$50. as the case may he. II half n
dozen persons buy Union Pacific at ~
on one point margin. the manager OF
the office gives the signal for n fic-
titiOus quotation of ~, That wipes
out the contingent. and the office buck
cts" the proceeds. which sometimes
amount TO as much rs Sl0.UM or $l5.-
600 In n single stock. In cases where
fictitious nttnfntfnns nnf nnSsfl.la
the more wealthy bucket shop men
club together and depress values on
the regular Stock Exchange To point
where their customers margin he
comes exhausted. They may spend
$1,000 In doing this. but where sew
eral hundred thousand shares are in
volved their relative profits are enor
NOUS
An interesting story was told the other
day where one rich man who was sen
to Los Angeles by his physician ar
ranged with his New York broker 10
wire on quotations OF the principal
stocks every hour. He noticed. how
ever. that IL was daily custom for the
guests ut the hotel where he was stop
ping TO visit large brokerage Office
which displayed huge bulletin boards
showing the movements Of various
shares. The office was extensively
equipped and appeared TO do thirty
ing business. The visitor soon observ-
ed. however. that the quotations diff
fered widely from those sent out by
his New York agent, and suspccting
that something was wrong he left In
structions ut the hotel 10 have the
messages sent him at the brokers' Of
flee as soon as received. This was
done, and he Immediately discovered
that the quotations displayed ON the
bulletin board were fictitious and that
patrons OF the firm We're being system
atically robbed. The concern was Il
bucket shop and received enormous
revenues by bucketing the funds Of its
customers. who were swindled out Of
their margins.
In this way the bucket shop always
wins. except I'm continually rising
stock market. where some concerns
have been forced TO the wall. The pub
lie as a rule only buys for an advance.
and never sells stock short.-New York
Post