Evening star., 1923-07-27
Bucket>Skops Recruit Workers
FROM Depths of Underworld
First Work Game on Gay White Way
Denisens and Then These Take Up
Same Game in Turn.

sued weekly. and presenting a story
of the course of the market during
the week, with an optimistic fore
cast on the market in general. and
stories on latest developments in the
affairs of various companies whose
stocks were active marketwise-these
stories generally being written. of
course, in tipster form. Such litera-
vast numbers of out-of-town pros
pective clients in a quick way. One
house. which was reputed during one
period as sending out between 100000
and 100000 circulars week. found
1t convenient to establish its own
printing plant to handle the business.
Start Branch Omces.
Branch offices were established by
many of these houses in several cities.
Some of these houses at high expense
! maintained their own leased wires to
the out-of-town branches.
The new BUCKET shops We'd with
each other In commission payments
to 'touts." The "touts" were dis
guised agents who inveigled the un-
wary into opening accounts in the
bucket shops. Unknown to the new
customer. the tout" obtained a COM
| mission from the bucket shop for OBJ
being paid out of the money turned
in by the customer for the purchase
of the stock. 1t was rather common
gossip in the street when the gi>St
orgy of bucketing was on, that soene
houses were paying "touts' as much
as SO per cent in such commissions"
Another source of heavy eXpendi-
lures with many Of the bucket shops
was the maintaining of telephone de-
partments for the acquiring of new
business through the use of the tele-
l'phone. Large as were the telephone
bills incident to this method of seek
ing out new clients, particularly in
| the big cities. 1t was apparently insig-
niticant compared with the amounts
which were paid in commissions" to
the glib youth who worked in the
telephone boiler rooms" and obtained
this new business over the phones.
Telephone Lists.
One of the methods used in solicit
ing this line of business was for the
telephone salesman to obtain a list
OF the stockholders of company
whose stock was active on either the
Curb Exchange or the New York
Stock Exchange. and call up the
stockholders. giving each some infor-
in the affairs of the company and
suggesting that at any time the
shareholder desired to add to his
holdings. or to sell his holdings. the
house would be pleased to handle the
business for him.
This might be followed a few days
later by a second call in which at
tentton would be drawn to the manner
in which the stock had acted in the
meantime. with a little stronger suG
gestion this time for action by the
shareholder. In those cases in which
the shareholder happened to be de-
| sirous of disposing of his stock. the
bucketeerS were anxious to do busi-
ness with him because IL was gener-
ally possible to induce the customer
to use the funds thus obtained for
further commitments.
Sold Margin Securities.
One of the favorite methods of the
buck eteerS was to induce the holder
of stock which had a good market
to put up those holdings as collateral
for an additional purchase of the
stock. The object of the bucketeers.
| Of course. was to get the shareholder
to become so extended eventually
that a turn of the market would wipe
solicited over the telephones. over the
telegraph lines and by mall So GER
tain were the bucketeerS that the
customer would over-extend himself.
and that the market would eventually
turn against him, that they showed
little hesitancy, once securities were
put UP by the customer, to secretly
sell those securities on the open mar
ket and add the funds obtained
thereby to their own capital account.
The bucket shop man of fifteen
years ago generally figured on main
tanning a sufficient reserve out OF the
moneys turned in to him that on de-
pressed market he could buy fairly
large line of the stock which he had
bucketed at high prices. Also, In a
period of depressed market prices he
did not strain himself to get people
to open new accounts, especially on
the long side of the market, which is
the only side of the market that more
than 90 per cent of the public wants
GERS. developed in recent years, and,
as already noted. unacquainted with
the pitfalls of bucketeering. did not
keep any big reserve fund that was
intended for the purchase of securi-
| ties around low marks.
Riding to q Fall.
tentions, the extent to which they
in luxurious living, showed they
quickly abandoned those ideas. Also.
they were rushing pell NELL after new
accounts at a time when the securi-
ties markets were at extremely low
levels, discounting as 1t was one of
the worst periods of business depres-
sion which the country had known
in years.
1t was natural, therefore. that when
the market should start upward on a
| big scale in discounting a turn for
the better in business conditions. the
new bucket shops would be in a
| toners start to take profits to large
extent. or to call for their stocks.
particularly so should the bucket
| shops find but little money coming in