The New York Stock Exchange and Public Opinion / Remarks at Annual Dinner, Association of Stock Exchange Brokers, Held at the Astor Hotel, New York, January 24, 1917

by Otto H. Kahn

Some things were, if not approved, at least tolerated in the past which are not in accord with the ethical conception of to-day.

The same thing can be said of almost every other institution, even of Congress. Until a few years ago, the acceptance of campaign Should the Exchange be regulated? contributions from corporations, the acceptance of railroad passes by Congressmen and Senators were regular practices which did not shock the conscience either of the recipients or of the public. Now they have rightly been made and are looked upon as crimes.

Ethical conceptions change; the limits of what is morally permissible are drawn tighter. That is the normal process by which civilization moves forward.

The Stock Exchange has never sought to resist the coming of that higher standard. On the contrary, in its own sphere it has ever endeavored to maintain an exemplary standard, and it has ever shown itself ready and willing to introduce better methods whenever experience showed them to be wise or suggestion showed them to be called for.

In its regulations for the admission of securities to quotation, in the publicity of its dealings, in the solvency of its members, in its rulesShould the Exchange be regulated? regulating their conduct and the enforcement of such rules, the New York Stock Exchange is at least on a par with any other Stock Exchange in the world, and, in fact, more advanced than almost any other.

The outside market on the curb could not exist if it were not for the stringency of the requirements in the interest of the public which the Stock Exchange imposes in respect of the admission of securities to trading within its walls and jurisdiction.

There is no other Stock Exchange in existence in which the public has that control over the execution of orders, which is given to it by the practice—‌unique to the New York Stock Exchange—‌of having every single transaction immediately recorded when made and publicly announced on the ticker and on the daily transaction sheet.

I am familiar with the Stock Exchanges of London, Berlin and Paris, and I have no hesitation in saying that, on the whole, the New York Stock Exchange is the most efficient and best conducted organization of its kind in the world.

The recommendations made by the Commission appointed by Governor Hughes at the time were immediately adopted in toto by the Stock Exchange. Certain abuses which were shown to have crept into its system severalShould the Exchange be regulated? years ago were at once rectified. From time to time other failings will become apparent—‌there may be some in existence at this very moment which have escaped its attention—‌as failings become apparent in every institution, and will have to be met and corrected.

I am satisfied that in cases where public opinion or the proper authorities call attention to shortcomings which may be found to exist in the Stock Exchange practice, or where such may be discovered by the governing body or the membership of the Exchange, prompt correction can be safely relied upon.