Wauwatosa news. [volume] (Wauwatosa, Wis.) 1900-1948, 1908-12-11
HANDLING The
STOCK MARKET
HOW BROKERAGE FIRMS CARRY
ON A BIG MASS OF BUSI-
NESS.
DAYS WORK IN WALL STREET.
How the Staff Works in the Home Office
and How Branches Are
Carried On.
CONSTANT RUSH AND TURMOIL

With 100000 shares of stock and &c.
100000 bonds changing hands in a single
day this week on the stock exchange,
Wall street brokerage firms, especially
those with direct wires to branch offices
in other cities, were buster than ut any
time since the panic, a year ago, says
the New York Evening Post, November
IA. How, one may ask, was the mass
OF orders, which brought the total aver
age days business up to these extra
ordinary figures, handled?
Opening a New Account
When new account is opened with
stock exchange house, either here or at
branch office, reference is required IN
addition to a cash deposit. Ii the Gus
toner desires TO buy stocks on a margin,
he must deposit at least $1,000 on each
lO0-share lot traded in, irrespective of
the price at which the stock is selling.
interest is allowed ON the $1,000 de-
posted, offset by interest charged against
the customer on the balance advanced
by the brokers to make the purchase.
Thus supposing the 100 shares to have
been purchased at par, $4,000 would
have been provided by the brokers, on
winch the customer pays interest The
margin of $1,000 or 10 per cent. par val
ne must be kept good. Hence, if the
market price of the 100 shares of stock
purchased at 100 share declines to 30,
the customer is called upon Immediately
for 5000. To open an account on the
books, buy and sell, watch margins,
transfer stock, and arrange its own
loans, any important brokerage firm must
employ between 70 and 100 men.
III branch office is maintained say,
at Plttsburg, similar staff of clerks
must be maintained there. The New
York office simply opens up an account
with the branch office as it would with
any other individual customer. In other
words, the Pittsburg office, not the Gus
toners of the Pittsburg office, is charged
and credited with purchases and sales.
The Pittsbhrg office. therefore, must
keep the accounts of its own customers
and keep its own margins good with the
New York office.
How Private Wires Are Used.
If a customer of the Pittsburg office
wants to buy 100 shares Of say. Union
Pacific, he turns the order in at the
Pittsburg office, and a brief message to
buy loo Union Pacific is wired to the
New York office. The instant the mes
sage is received by the New York office
1t is turned over to the telephone clerk"
who repeats 1T over a special telephone
wire to another clerk stationed on the
stock exchange floor. The last named
clerk notifies the floor member of the
firm, by an electrical system of signals
placed on the walls of the exchange, that
he is wanted at the telephone. The floor
member rushes to his private telephone
wire, receives the order, and executes
it, Thus the order travels from the
Pittsburg customer to the stock exchange
floor.
If the wire is clear the order is turned
in at the Pittsburg office, executed in
New York, and report of the transac-
ton furnished to the Pittsburg customer,
inside of two minutes. But as far as
the clerks are concerned, that is only
the beginning of the transaction. The
purchase must be entered on the books
here and at Pittsburg, and the transfer
of the stock and the loans to carry it ar
ranged. During the great bull market
of 1901, clerks employed by stock ex-
change houses slept and ate in their of
fees for days Mt a time, including Sun
days. A holiday was finally declared by
the stock exchange to enable the office
staffs to catch up with their work. BY
an irony of fate. this special holiday.
decreed a week beforehand, came two
days after the famous smash of May o.
where the bull market" was definitely
over