BEHIND THE TICKER TAPE

the world people buying and selling shares in the companies the American Stock Exchange big leading corporations and young vital growing companies these securities represent the money invested in industry to buy the tools he doped the plants is through this icky capitalist producing goods for the world earning profits and paying dividends is the marketplace the American Stock Exchange this is our visitors gallery for investors students and sightseers visit us each business eBay visitors can actually feel the hectic pace of the trading operation skilled personnel provided clear-cut answers to every question this man is speaking down here it's not only polite to talk with your hands it's downright essential he doesn't speak nor does he write yet what you see here is the report of a purchase of stock that he's just completed acting for a client who may be thousands of miles away handling the stock transaction that could consume dollars - these men moving busily among the trading post it is perhaps just another day but to me this is a very big day indeed one of the most important days in my life and Here I am Tom Gordon newest member of the brokerage firm of Gordon and cam although I now have a regular membership of this exchange but is I now have a seat on this exchange I'm still a novice and will be until the board of governors this Committee on floor transactions decide to acquire the experience necessary to execute an order on my own right quotes EMF for Denver okay that's probably Fred Sanford he requested information on some stock who said long time last week cmf closed yesterday at twenty five and a half it's not bad for an apprentice Senate's always a good sign when a customer asked for up-to-date information about the stock it shows he's going about investing in the right way we always encourage our customers to investigate before buying the stock I should know about the company that's present set up future potential all member firms are always eager to give investors such information to help them decide whether or not to buy stock in any given company traded on the exchange do you think this man in Denver will buy CMA let's wait and see our firms research and statistical facilities are always at his disposal our Denver friend is wise he's investigating before he invests let's go over to the cmf Trading Post good the exchange is laid out something like a supermarket each stock is traded at a particular Trading Post like the meat counter or the fruit counter cmf is a symbol continental manufacturing corporation anyone wishing to buy or sell this stock must do so here our CMM 25 and a half bid offer to three-quarters last sale ahem this means that there is someone willing to buy at twenty-five dollars and fifty cents a share and someone willing to sell at twenty-five dollars and seventy-five cents a share and that the last buyer paid $25 fifty cents per share man in Denver we'll have that information within one minute good morning Jim well Charlie Wilson Oh golly hi I just came over to meet the newest member of your fire Charlie Wilson my son Tom how do you do I looking lad if you do have as well as your old man you will be fine no man look who's talking no one knows how long you've been around here our gym there are some things a man just has to keep to himself yes I never mind that old-timer stuff I want to talk to you boy well Tom what do you think of all of this it's very very impressive securities of over 800 companies are traded here securities worth about 25 billion dollars but it wasn't always like this it wasn't I guess things have really changed around here since that you were a newcomer you make me sound like a 49er an 18-49 er well from what I've read those days must have been very exciting it's no doubt about it days of the gold rush the thrill of finding gold and opening new territory and a segment of building a continent the wonderful opportunity of investing in the strength and growth of the new nation and sharing in the future potential of American industry and commerce the curbstones of New York City provided a birthplace a name and a home for the old outdoor curved market where securities trading was actually carried on in the streets and on the curbs of downtown Manhattan here under the open skies were big new industries requiring mass capital were beginning to seek public favor the curb market provided a clear reflection of the increasing importance of the corporate form of ownership like all the great marketplaces down through the ages this market later known as the New York kind of exchange followed its humble beginnings and the streets I'll bet they never guessed it would grow into the American Stock Exchange of today [Music] actually Tom the first brokers were a few men who used to meet informally to buy and sell securities they themselves owned pre soon it became a daily gathering the same men meeting in the same place then friends of these men people who were too busy at other work to meet here had these men trade their securities to buy 1875 the curb market had become a very important part of New York life finally the lack of space and Wall Street forced these brokers to change their meeting place to William Street between Exchange Place and Beaver Street when the outgrew William Street they moved to Broad Street about 1900 wasn't it but I don't remember personally time but it was intimated nine days later it located in front of 44 Broad Street by that time regular trading hours had been established these brokers met here in all kinds of weather right summer days cold winter days rainy spring days gathering around the trading posts where the various stocks were traded and these days of course there were no Trading Post as we know them today instead a trading post might be a mailbox or certain doorway or a fire hydrant here to the market was experiencing its first real growing pace the market was big now the street busy with men handling millions of dollars worth of securities anyone could come along the sidewalk and shut himself up as a broker of course any agreement to buy or sell depended entirely upon the personal integrity of the individual you did business with but it soon became necessary to establish some sort of membership as a ganti of sincerity and efficiency so in 1908 a small group of the leading brokers formed the New York curb agency by 1911 it had evolved into the New York curved Market Association whose Board of Representatives grew up trading rules and methods for enforcing them memberships were limited to five hundred and a listing department was established to admit the securities of qualified corporations to trading and to keep records on file for the public to examine but these were the problems of a general nature the problems of the individual brokers were even more immediate when a broker completed a transaction he had to notifying his office using messenger boys was not satisfactory because the boys often could not find the broker in the crowd he could not use a telephone unless he had one installed inside the door of a nearby building even that took too long I've got I've got it I've got the answer to this I'll call you back [Music] well I'll be down there to talk back and forth when do you want the room on sounds like the crazy idea but if you want it it's okay with me you mean that's how I begin yes that's my understanding of how it actually began but the important thing is that telephone order clerks began appearing in the windows overlooking Broad Street although there's solve one problem by connecting the broker on the street directly with his office built on these boys and all these windows also created another one it was almost impossible to exchange information with your own telephone Clerk when all the other brokers and folks were shouting at the same time [Music] [Applause] oh I know what happened then they invented hand signals exactly the same ones that we use today on the gigantic trading floor the American Stock Exchange the broker is claiming to report the purchase at $20 per share of 100 shares and a steamship company [Music] these hand signals were used with great accuracy however there was still another obstacle to overcome telephone clerks found it almost impossible to locate their brokers in the crowded street burton alert brokers found that problem by wearing a dual-purpose hat a hat that could shelter his head from the elements and also stand out in the crowd as a beacon and a means of identification [Music] [Applause] [Music] pretty soon other brokers got the idea of wearing colorful hats some very unusual looking ATS began to appear later some very colorful outfits to meanwhile the curb market became one of the sites for any visitor to New York too many of the tourists the exchange looked like unplanned madness as brokers - to and fro calling and gesticulated hectic as it all was this system of trading had developed through the years until this accuracy and speed of operation were amongst outdoor trading here hit its peak between 1900 and 1921 and public interest in securities grew steadily new stock issues of powerful industries at what at that interest and we're keeping it keen year after year this market not only kept pace with the nation's industrial and mercantil growth but actually provided a certain leadership and direction this became the market place for industry leaders and the seasoning ground for the stock issues of new organizations which were later to take their places as leaders in our economy here through enough fitting public auction where the public has set the price securities a very industrial category were bought and sold during World War one it was in Broad Street that so many of the companies that were to help win the war were financed here the steel stocks munition stocks copper stocks marine and other stocks were traded this started these young corporations on their way to becoming the powerful industries of today and as a companies grew also did the outdoor market grow brokers felt the need for improved systems of trading and deliv and payment for securities and for tighter supervision in 1921 the exchange moved in doors were more formalized procedures could be established however in moving everyone felt it was very important that the same efficient setup be preserved today the exchange still provides the same clear lines of vision for the broker and the telephone order clerk so that the hand signal can still be used effectively of course sir another big reason for moving indoors was because of the the need for instantaneous reporting of transactions now the words in the stock ticker when the brokers met on the street it was impossible to inform the public immediately of the prices at any given moment with a ticker each sailors planet every time within seconds after the transaction has been completed on this floor in this way a man thousands of miles away knows immediately what is happening in the market I'll take mr. Sanborn in Denver for example he's already received all the statistical information available on hot nanomanufacturing corporation he continues to follow the activity of the market on the ticker in the firm's branch office in Denver so he knows all the facts [Music] mr. Sanborn I have that quotation on continental manufacturing twenty-five and a half bid offered 25 and three quarters last sale 25 and a half buy 100 shares for my account that 25 and 3/4 places New York send us by order [Music] edie take an order from denver to buy 100 CMF at 25 and 3/4 by 100 cm f at 25 and 3/4 there's a number on the annunciator board assigned each member of the exchange it is used by the telephone clerks to gain the brokers attention Oh dad [Music] come back on that quote our CMM 25 and a half offered at three quarters 25 and three quarters for 100 CMS so the transaction has been completed and for this service the brokerage firm has earned the commission a commission charged to the customer at a rate previously published and made known to the customer as the office is relaying the report of the purchase back to mr. Sanborn in Denver a floor reporter is noting the sale employed by the exchange for the purpose of recording all transactions as they are made this reporter now hands his written memorandum to a page who sends it through the pneumatic tube direct to the ticker operator within a matter of seconds thus a public report is made of the purchase of 100 Continental Manufacturing Corporation common shares at twenty-five dollars and seventy-five cents a share and this information is immediately seen on ticker tapes throughout the United States and Canada information is important here it must be delivered quickly the whole picture must be completely on the floor the American Stock Exchange for example the broker can tell at a glance what is happening on the Toronto Stock Exchange on the right hand screen and on the New York Stock Exchange on the lower screen on the American Stock Exchange on the upper screen these three markets are considered to reflect the basic trends meanwhile the ticker of the American Stock Exchange is being viewed in a thousand locations information is available in almost 2,000 branch offices of member firms to aid investors in analyzing the potential of the many established corporations and growth companies whose shares are traded on the American Stock Exchange where over 300 seasoned companies have paid dividends for between 10 and nearly one hundred and ten consecutive years and where they can watch the small industries of today become the Giants of tomorrow where they are able to show the same imagination and faith as was shown by the people years ago who foresaw the development of small workshops into the humming plants and factories of today the American Stock Exchange which provides trading facilities for approximately 150 stock issues representing a dozen foreign countries is the top-ranking market for foreign stocks in the United States stocks and bonds covering 20 foreign countries are traded on this exchange one of the future what can the investor look forward in this marketplace in this building a nerve center of investors service were direct exacting lightning-fast communications are maintained with nearly 2,000 member firm offices and 461 cities here and throughout the world the future is being molded a future which is attracting interest from all over the world the American Stock Exchange is an important part of the story of a nation which has grown great and strong through the savings of millions channeled in the productive enterprise through securities investment it is to the service of the investor and Industry to the growth of a sound economy that the exchange is dedicated [Music]