The Washington herald., 1907-05-28

Much interest is manifested in Washing
ton over the fate Of the Mesta anti
bucket shop bill, pertaining to dealing in
stocks. grain, or cotton on margins, which
has passed both houses Of the Pennsyl-
vania legislature and now awaits the sig
nature Of Gov. Stuart to become q law.
There are six or seven correspondent
Offices in this city which this proposed
law will put out of business. unless they
make other connections, or unless the
main houses in Philadelphia simply move
TO Camden, y. J., out Of the jurisdiction
of Pennsylvania.
The Mesta bill, If signed by Gov. Stuart.
will revOlutionize stock. grain. and cot
ton dealing in that Commonwealth. 1t
will stop. in Pennsylvania. the business
of that class of brokers who buy or sell
TO their correspondent" within or with
out the State. It will stop the business
Of brokers who sell a contract option to
receive or deliver to their clients any
stock at a specified price, before other
specific price or prices for the shares in
question are recorded upon the exchange
or board Of trade where the shares in
question may be listed and given quota
ton"
Prohibits All Such Business.
All such business the proposed law pro
hibits within the boundaries Of Pennsyl-
vania As a result brokerage houses
which operate on these lines must either
stop, change their location beyond the
reach Of the law, or change their methods
so as 10 conform with the law. In short,
it sounds the death-kneT Of the bucket
shop in the Keystone State, and those
which have hitherto received their quota
tions from Philadelphia. which means
about 60 per cent Of the bUcket-shOps in
the United States
Under the Mesta law every order given
by a client must be given bona fide ex-
ecution upon an exchange wherein a mar
ket is made for the stock. In other words,
brokers in Pennsylvania must have direct
connection with the New York Stock Ex-
change, the Chicago Board of Trade. and
the Cotton Exchange in New York CT
New Orleans, and conduct their business
as regular brokerage houses do, or quit
Il is thought in Washington that most
of the houses belonging to the main
buCket-ShOp circuit will simply move
across the river into Camden, If the Mesta
law Is signed. and that the general busi-
ness Of such concerns throughout the
United States will suffer only a slight in
terruption OF business.
II may be mentioned in this connection
that Washington was at one time consid-
cred by the irregular brokerage circuit"
as the best place for its main operations,
but when q was decided by the telegraph
companies that the outlaw fast quotation
Wire could not be extended beyond Phil
adelphia. the project Of locating here was
abandoned. and New Jersey was selected
rs q safe retreat from the drastic laws
enacted in New York against the bucket
shops
Driven Out of New York.
Il will be recalled that New York passed
a law two years ago taxing all stock
transactions 81 per 100 shares. which was
the means Of driving bucket-shop head
quarters out Of Manhattan. As a result.
there are about ten wire houses located in
Jersey City, and three in Newark, which
l1-lilHlte 't.flottA AiNiI -NtN 1Dihs NOW
it is thought the Philadelphia contingent
may join that I'm Newark. and the head
quarters Of the bucket-shoD business be
relegated 20 Jersey.
Massachusetts has just passed an anti
bucket-shop law. which, il is expected.
will prove effective in stopping this class
Of business in that State. Many of the
shops that have been doing business in
Boston and the larger towns Of Massa-
Chusetts are preparing 10 move 10 Connec-
ticut TO get away from the drastic regu-
lati0ns imposed upon them I'm Massachu-
setts This must be done prior TO June j.
In MassaC Chusetts the law allows brokers
to operate upon a 10 per cent margin basis
by executing the orders Of clients upon
some b0na-hde stock exchange and it is
supposed that many Of the present bucket
shops viii get seats I'm Boston OF New
York and continue i'm business.