Evening Star Newspaper, June 8, 1930, Page 80

THE SUNDAY STAR, WASHINGTON, B. €, JUNE 8 19%. How New York’s Wild Curb Market Has Tamei d'he Day When Traders Wore FunnyHats and Stood in the Street in Various Kinds of Weather Is Now Forgotten. BY GILBERT SW AN. HE New York Curb Exchange is rap- e idly moving toward its final step F into complete respectability. It is preparing to take over an elegant new home, and when it does the last vestiges of the humble beginning that gave the Curb its name will have vanished. For the Curb Exchange was originally just that —a market in which the brokers of odd lots of the cheaper stocks stood on the curb and signaled their orders to buy and sell to others in windows high above them in offices where the orders were executed. The stocks dealt in were usually lower in price and less established in the financial world than those listed for trading on the New York Stock Exchange. As the years passed, however, the Curb tightened its requirements for listing, and now, as it is about to take over its new building, there is practically no difference between the prestige of its list and the list of the older New York Stock Exchange. This new home of the curb market is the typical modernistic and efficient-looking build- ing of the Wall street belt. There is nothing about it to suggest the turbulent trading of the sidewalk and curbstone days; nothing to sug- gest the rebellion of traders who preferred the open street to the conservatively organized Stock Exchange; little to remind one of the shoutings and hand wavings, the night trad- ings in picturesque old taverns, the amusing signals and the musical comedy attire affected to distinguish certain manipulators. . NOW there is all the disciplined procedure of the thoroughly oiled business machine of today—some 15,000 feet of trading floor space, some 6,000 feet of telephone space, seats which bring more than a quarter of a million dollars. The “Curb” has traveled a long, long way from the madhouse antics staged in the open highway and accentuated by seemingly insane shoutings and hand wavings and gyrations. This was in its day one of the spectacular sights of New York, a free show which tourists from every section of the world took in; a show which caused every one to wonder at its actors and yet which proved a vital first act in the Nation's economic drama, which today finds millions with one eye glued to the ticker tape. But had you walked througih Broad street as recently as nine or ten years ago, a truly in- credible scene would have been presented to your eyes. There, in what was referred to as “Exchange square,” you would have been at a loss to explain the presence of many curiously garbed men. One might have been wearing a Scotchman’s plaid turban, another might have been affecting a violent green felt topper; thers would have been a considerable collection of screaming red caps, some white duck yachting hats and other flashy types of head dress. To the stranger, this might all have seemed like some inexplicable carnival. OF a sudden, the strangest of tumults would have started. Crowds of men, packed from sidewalk to sidewalk, would, seemingly without reason, have begun dancing about and shouting and pushing each other, looking up at the win- dows in the tall buildings about them and making mysterious gestures with their hands. Some would hold up two fingers and some would have fists. In the windows were busy- Jooking telephone operators with receivers clapped tightly to their ears. Within a few moments the scene would have been a com- bination of the biblical Babel and an imitation of a deaf and dumb school picnic. But, believe it or not, a great cross-section ©of the Nation’s business was thus being carried on. Stocks in some of the Nation's greatest enterprises were being bought and sold. For- tunes were being made and lost. The ludicrous- looking hats were solely for purposes of identi- fication. The men peering from the windows above could recognize a certain trader or set of traders by the funny-looking skull caps, and all the finger manipulation was the process of bidding. And this would go on in fair weather or foul. Serious business men, engaged in affairs of tre- mendous moment, thus pranced, shouted and motioned in rain, sun and fair weather; busi- ness history was made and prices established by methods so picturesquely unbelievable that many today marvel that it could have contin- ued for so many years without change. IN just such a scene, but maddened and ex- panded by the exciting times, the famous #“war brides”—that is, the stocks representing ammunitions, explosives, copper, ships and the Hke—whipped the crowds of figurines in the street into a sort of fury which sent dozens of securities’ skyrocketing and made fabufous for- ¥ty R VR T ‘)LL foitans 1 LI T SO WES T N A § P tunes for the wise ones. This market crisis brought about the change in the picture, and the spectacular and amusing street scenes van- ished as the “Curb” put a roof over its head and began to use the methods of the Stock Exchange. With investment and speculation grown to their present stature, it would, of course, have been impossible to carry on in the primitive, though colorful manner of yesteryear. In faet, the “Curb” had already outgrown its curbstone when it determined to move indoors and op- erate with an efficiency made possible by mod- ern methods. Toward the end of it sidewalk career, the ”Curb” had already outworn a couple of wel- comes, having drawn complaints from office tenants in nearby buildings who were disturbed by the racket, and having grown to such an extent that the finger signal method had been replaced by an army of messenger boys who darted hither and yon with orders and trans- actions. The work. it became apparent, was to0 great for even the hundreds of alert youths. To understand how this all came about, it is necessary to turn back to the years just before the American Revolution when London pose sessed, almost for a century, a sidewalk ex- change which finally moved indoors, using a coffee house and ale shop. The idea spread to Paris and, during the period of our own Louisie ana colonization, the cunning manipulator, John Law, introduced his amazing speculative scheme which became known to history as “The Mississippi Bubble.” The general scheme eon- cerned securities in a company which was to colonize and develop in America. Its blow-up caused a financial panic in France. ALL over Europe, trading was first done in the open air. And s>, with this backe ground, the first American traders in market securities gathered under a buttonwood tree on a spot which now holds a Wall Street sky- scraper. There were 12 of them, and they were creating an open market for the first bond issue to be floated by th's infant Nation—an issue for some eighty millions, at 6 per cent, and intended to defray the expenses of the Revolutionary War, which had but recently ended. As new enterprises came into being, the op- erations of brokers expanded. but there were no rules of conduct, no regulations nor definite membership. As usual, scoundrels entered this “easy money” racket and fleeced the trusting ones so that a solid organization became neces- sary to weed out the unscrupulous. After the War of 1812 they moved into the famous Tontine Coffee House in Wall Street, taking over the entire second floor for $200 rental per year, “including firewood and chairs and room service.” This grew into the present Stock Exchange. But during the various changes there were a certain number of inde- pendent brokers who went their own way, with the open street as their office, and no definite trading hours. Thus in Civil War times, the “Curb” opened Continued on Sirteenti. Page