EVILS OF TALKING IN SLEEP.
These things would never have been known, but that T. sometimes talks in his sleep, and while chuckling over the ruse de guerre, he recounted the whole story, and was overheard by his chum, who thought the joke too good to be lost.
HOW BROKERS SOMETIMES FAIL.
And now, said my friend, as I am in the way of story telling, I will tell you how money has been made, by doing a losing business. It will have been seen already that the failure of a stock broker, does not involve commercial dishonor. It is a mere acknowledgment, of his inability to pay his bets, for debts they are not. When this has happened, he suffers the penalty of being expelled from the board. It then becomes the interest of those to whom differences are due, (the term used for stock debts,) to get what they can and discharge him. The amount he will be willing to pay, depends on three-fold circumstances—the amount of means he possesses—his own sense of obligation—and the credit and advantages he is to gain, by being reinstated. And a settlement once made with his creditors, it becomes the interest of all, to reinstate him; for society becomes disjointed, by losing its prominent members.
When a broker operates for others, as his principals, he usually requires a deposit of ten per cent., as security against loss. They generally operate in different kinds of stock, some of which turn favorably for their interest, and the differences are in their favor. In others the difference is against them, according as their risks, or their judgment, may have proved favorable, or unfavorable. Commonly their operations are very large in amount, and it sometimes happens, that the fluctuations are greater than the security, and by the occurrence of some unforeseen event, like the recent failure of the United States Bank, a fair adjustment of the differences against them, would ruin all the parties, consequently, one or all of them must be sacrificed.
HOW THEY GET UP AGAIN.
Expediency, and interest dictate that it shall be but one, and that one the broker. He consents, because it involves less dishonor with him than the others. They can be screened by his defalcation, and, it is equally his interest to take care of his customers, as himself. And if he has not too delicate a conscience, (and all men have not,) the way is now open for the following management. When differences are in his favor, he may avow his principals, and the losers must pay, or themselves suffer expulsion from the board. Where the differences are against him, he may keep the responsibility to himself, and as they are very large, he will be able to compromise them, for the ten per cent. deposited, and perhaps less, if he has not been careful to exact the security. And when the whole is adjusted, if the differences collected exceed the ten per cent. paid, there is a profit to divide, among them all. And, if these operations are not sometimes performed with a less scrupulous regard to figures, suspicion has been guilty of a libel. I do not say, that this is a common practice among the brokers, but the power of doing, and the facility of screening it, are equivalent to an invitation to rogues to embrace it, and all the world knows, how ready they are to seize an opportunity.
AMUSING OPERATIONS.
Although stock-speculators, generally, affect to be very secret, as well as very cunning, in their dealings, they frequently contrive to find out each other’s business, and the manner in which their liabilities sometimes develope themselves is amusing. It lately happened that two speculators, Mr. A. and Mr. B., had been operating in different kinds of stock, and each of them thought he had a considerable amount of profits to collect, and losses to pay; and the whole having passed through a broker’s hands, neither of them was supposed to know who the principals were. Circumstances led to a comparing of notes, when it was found that their claims on each other were so nearly balanced, that they settled it by offset. It is believed that at least one of them intended to collect his profits, and back out of his losses; but that the other, more cunning than he, had contrived to take the place of a third party, (Mr. C.,) who was the real seller of the winning stock on his side, and when a settlement had been made between A. and B., that B. and C. divided the amount of profits on C.’s stock between them. By these means, the third party, C., was enabled to collect half of a profit, which he would never have got otherwise, and the other, Mr. B., was saved paying half a loss, which he would otherwise have had to pay, or to sacrifice his broker, who, between them both, was saved from a dilemma.
WALL-STREET NOT A SAFE PLACE.