THE LONDON STOCK EXCHANGE.

New Zealand Times, Volume XXXIV, Issue 5762, 17 September 1879, Page 3

THE LONDON STOCK EXCHANGE.

(CONTRIBUTED.) Periodically we have mention of the Stock Exchange, and men talk glibly about it; but it is surprising the limited information one can gather about this great money market. A general idea exists that the Stock Exchange must be constituted of monied men, men of transceudant calculating abilities ; while some novices connect it in some way with the Mint, where the scales are a test of value ; this latter idea, by the way, might well be applied to very many bonds dealt in on the Exchange which would be found wanting in value at twopence a pound for waste paper. Undoubtedly there are men on the Stock Exchange possessed of wealth and wisdom ; but, as a body, they are a mediocre lot, and very often the wealthy compare badly with the man of culture, who may be a poor struggling jobber. The Stock Exchange fraternity is composed of brokers and jobbers, numbering over 2000—nearly twothirds are jobbers, who, as it is termed, make prices to the brokers ; the latter individuals being supposed to represent the outside public. Only bonds, shares, and stocks are dealt in on the Stock Exchange. A good many years ago the number of members was limited to 1399. On the doors it is notified, “ For members only,” and if a stranger happened to stroll in, the cry was 1400,” and through use (although the number is not so limited) is still. “ 1400” oftentimes gets badly used if he is at all obstreperous, his hat may get caved in, he may be jostled and chaffed, certainly he comes out a sadder and a sillier man. No European nation is unrepresented on the Stock Exchange. There Jews “ jew” each other, and Greek meets Greek, whilst merry England, canny Scotland, and rolicsome Pat. buy and sell with monsieur and mein herr. It has oftened been likened to a wild beast show, and judging from some of their terms, the likeness is not at all inapt. These are “ bulls" and “ bears,” “ monkeys” and “ ponies,” and five years ago an oleaginouslooking member answered to the name of the “ City Octopus.” A “ bull” represents a man who has bought on speculation, but not paid for |his purchase ; a “ bear” is one who has sold that which he does not posssess for a probable fall, whilst “ monkeys” and “ ponies” are numerical phrases, more common to the turf than the Exchange. The method of deal-

mg in stocks and shares may not he unworeny of remark, involving, as it does, some of the most extensive monetary operations which occur under, perhaps, any one roof. The jobbers assemble, as already stated, to make prices to brokers, or, in their absence, to each other, that is to say, they offer to buy at what their ideas of the market should be the buying price, or sell at the supposed selling price. There is no calling off a bargain once made and duly checked next day. This system of dealing might be serviceable to our auctioneers, when a crawler finds a crick in the leg of the chair he thinks he has got a bar. gain, but won’t take delivery of on account of the crick. All transactions are settled fortnightly, with the exception of Government securities, which are settled monthly. There are three settling days, viz., contange and making-np day, name-day, and pay-day. It would take up too much space to enter fully into the mtdus opemndi of a Stock Exchange settlement. The word contange might, however, want a little explanation. It means a percentage, or charge, for carrying over or continuing speculative dealings from fortnight to fortnight, and is generally a good index of the preponderance of buying or selling, or showing whether there are more bulls than bears. Name-day is that on which purchasers pass their names for stocks or shares bought during the fortnight. A clearing house established in connection with the Exchange a few years ago greatly facilitates the operations towards the settlement of this day, and has dene a very great deal to ease the enormous work and risk which was entailed on members previous to its existence. Payday, all the world over, and more particularly in the Exchange, is an interesting one. Should a member fail to meet his bargains he is in Stock Exchange vernacular hammered —f.c., he ceases to bo a member. The operation of hammering is simple. The chief waiter mounts a rostrum, gives three knocks with a hammer on an empty box, and states that the unfortunate one has not or cannot comply with his bargains. In times of panic “ hammering ” is a common thing, and in great panics which used to happen every seven or five years as many as -iO have been declared in one day ; small panics occur now a days almost annually. This probably assy be accounted for through the existence of

the telegraph, which happily is in almost every land, and under nearly ov--ry a. Dealing in securities on the Exohang- Rue dealing with patients ; they are weak or strong, shaky or steady, dull or inactive, flat or buoyant. Their treatment is somewhat strange too ; they bang, they puff, they niu-e, they sweat, they bleed, salt, fleece, pluck, skin, and roast. Fun and frolic, song, and r.n occasional jig is practised in this great market. It is not au uncommon thing to see a known Good Templar wearing at his coat tail a slip informing his friends tbatheisbeastlydrnnk, ora wealthy screw proclaiming in a like maimer that he is starving. Frequently it has occurred that members of the Stock Exchange have lost their reason through over-excitement. This excitement is altogether different to that experienced by bookmakers on a racecourse. There, the betting excitement generally subsides at the winning-post. On the Exchange, a speculator lives in a continuous inward unrest, sleeps little, eats hurriedly, and perhaps drinks more than is good for him. They manage their own affairs, having a committee annually elected by ballot from amongst themselves, which committee is endowed with absolute functions in determining right from wrongdealing, and punish accordingly. Suspension from membership is the extreme punishment they can administer. This Alsatia often been howled at in Exeter Hall from time to time. The House of Commons has tried to tinker it, but still the cannibalism of bulls and bears living on each other goes on, and is likely to, so long as individuals and nations have recourse to the London Stock Exchange. “1400.”