Графични страници
PDF файл
ePub

sterling. The commission upon these transactions—which varies from one-eighth per cent on the sale or purchase of Consols, to onefourth per cent on the dealings in other and more variable kinds of stock-amounts to a large sum; and this sum constitutes the profits of the stock-brokers, who conduct these sales and purchases for the public. A stock-broker ought not to deal or speculate in stocks at all. He is simply the agent by which such sales and purchases are effected. And if he himself becomes a dealer, the persons who employ him have no security that their interests will be properly attended to. may buy for himself the stock which they commission him to sell; and in such a case it is not to be expected that he will give for it the highest price that can be obtained. But the stock-brokers are not the only parties in the Stock Exchange. There are also the stockjobbers-men who deal in stocks and shares, selling them at the highest price which they can get, and buying them at the lowest.

the amount of money which requires to be sent thither, the bills may be purchased at a fraction below their normal value; but if the payments to be made in Calcutta exceed the amount of the bills, then a competition for the bills ensues, and their price is slightly enhanced. But the range of variation never exceeds the difference between the cost of postage on the one hand, and the expense and inconvenience of transmitting specie on the other. The normal price of a bill, as we have said, is simply the amount of the bill, minus the discount on the time it has to run. Accordingly, by means of these bills of exchange, the whole cost, risk, and inconvenience of collecting and transmitting specie from one country to another is saved. And this saving is really an immense one. If the payments of commerce had to be sent backward and forward from country to country, not all the specie in the world would suffice to carry on operations so vast. If the agency of bills were suspended for a few months even between England and India, the drain of currency would speedily produce a deadlock in both countries. Such is the importance of the operations in the Royal Exchange; and there are no others, even in this Capitol of money and trade, which display in so remarkable a manner the immense extent of British commerce, as well as the skill and mutual good-faith with which its operations are carried on.

[ocr errors]

The operations on the Stock Exchange are of quite a different nature. The property there dealt in is stocks and shares of all kinds : Government securities, ranging in solidity from British consols, the steadiest of all, to Greek coupons and Spanish passives railway shares, mining shares, and shares and bonds of joint-stock companies of all kinds. In these the public invests its spare capital, and the transfer of these stocks from one hand to another, by buying and selling, is so great that the daily average of transactions amounts to many millions

He

The entrance to the Stock Exchange-or Capel Court, as the large room is called where these operations are carried on is through a large pillared front, or portico, facing the east end of the Bank. But it has other entrances. We remember the first time we stumbled upon this sanctuary of jobbing upon this forbidden ground to the public, or to any one who is not a member of the brotherhood who carry on their operations here. Seeking a short cut from the eastern part of Threadneedle Street into Throgmorton Street, we entered an alley not so privatelooking as many which in this precinct connect one thoroughfare with another. Men were passing along it to and fro, and we did not doubt we should quickly emerge in Throgmorton Street. But suddenly it assumed the appearance of a cul-de-sac, and we found ourselves at the doors of a large hall, full of people and of a clamour of tongues. A porter was at the door to keep

out the profane vulgar: and the room into which we were looking, both through door and window, was the Stock Exchange. This place of business is the property of a corporation; and, unlike the Royal Exchange, no one can come there to sell or buy unless he be a member of the corporation. It is for its own members that the Stock Exchange reserves all the profits on the traffic which goes on within its walls. The business of the stockbroker is simple enough, and if he have good connections, it is as profitable as it is easy. When he gets an order to execute, all he has to do is to buy or sell at the current rate. He steps into Capel Court, and at once finds the dealers he wants. Every stock-jobber has a special line-one deals chiefly in Mexicans, another in Indian stock, and so on; and, moreover, there are places in the room where certain kinds of stock are specially dealt in. The broker finds the jobber, and, after ascertaining that the terms offered are in accordance with the ruling price, he makes the bargain, and in five minutes the business is over. The money, whether given to him to make a purchase, or received as the proceeds of a sale, passes through the hands of the broker, who deducts from it his commission, the cost of stamp or registry, &c. The business of the jobber is a much more difficult one. He is, in fact, a speculator. He buys stock in the hope of selling it again at a higher price. It is therefore indispensable that he should carefully examine the character of the stock in which he deals, and the circumstances, whether political or commercial, which from day to day affect its value. He knows that the value of stock, although substantially dependent upon the soundness of guarantee and the rate of interest which it yields, is nevertheless affected from day to day by what may be called merely moral influ

ences

-by passing gleams or shadows, flitting prejudices it may be, which affect the popularity though

not the permanent value of the stock-or merely from sympathy with the rise or fall in other stock of a similar character. The public has neither the leisure nor the knowledge sufficient to judge with confidence, and is generally more encouraged or depressed by the rumours or facts of the day than there is reason to be. All these things the jobber has to take into account; and as it is no easy matter to be a prophet, he must either be a lucky or a clever fellow if he does not sometimes come to grief. Great gains usually alternate with great losses in this kind of business. One would think these jobbers would soon die of worry and anxiety, and often enough they are to be seen very down-in-themouth. But Nature is kind, and fits the back to the burden. rather, most of these men have been born with the peculiar temperament of the speculator: they have an extra amount of hopefulness, and get through life, with more excitement indeed, but hardly with less equanimity, on the whole, than any other men engaged in trade.

Or

The most novel feature in the economy of capital during the last year or two, has been the establishment of great credit-companies. The special object of these companies is to provide money for carrying out industrial or financial enterprises which are worthy of support. The credit-companies do not directly engage in these enterprises: they simply launch them, or at least provide the capital requisite for carrying them on,charging a commission for their aid. One of these, the International Land Credit Company, is worthy of notice here, because its operations display in a remarkable manner the system of financial cooperation which is now being established throughout Europe, as well as the great amount of social good which may be effected on the mere principle of self-interest. There is no safer security than land; but the prime requirement in financial

operations is, that the security manage the whole of this part of should not only be perfectly safe, the business, while the Bank furbut readily negotiable. In other nished the funds. This business words, the bonds, representing the proved so profitable, and the field money advanced, should not only be of operations was found to be so certain to be paid when due, but the extensive, that it was resolved to holders of them should be able to invite the co-operation of capitalists sell them easily, or get money ad- all over Europe. Hence the estabvanced upon them. Not one, but lishment of the International Land several financial establishments are Credit Company. The business. needed to accomplish these ends on of this company is simply to raise a large scale; and the International funds for carrying on the highly is the last and crowning company profitable operations above-menof a series previously established. tioned, the money being readily It will deal with land everywhere, obtained from the public upon but at present its field of operations bonds issued by the Company, and is in Austria. In Austria there are bearing 5 per cent interest, and estates of immense size, held by in- which are rendered more than usudividual proprietors, many of them ally negotiable, owing to the numheavily burdened with mortgages ber of local land-banks and other contracted on the most usurious financial establishments which are terms. Half-a-dozen years ago affiliated with the International. The some foreign capitalists discerned credit of conceiving so remarkable the fine field that was here open to a series of co-operative companies, them; but before foreign capital to and of successfully establishing it, is a large amount could be attracted, due to M. Langrand-Dumonceau, of it was indispensable to establish the Brussels. The security offered is perfect soundness of the security the most complete that can be and the negotiability of the mort- imagined:-1. The land; 2. The gage bonds. The first step towards double amount for which the purthis was the establishment at Vienna chasers give their bond; 3. The of the Vindobona a joint-stock capital of the Vindobona; 4. The company which, on receiving a per- capital of the Banque de Credit centage or commission, guarantees Foncier et Industriel; and lastly, the repayment of loans on estates, The immense capital of the Interas well as the regular payment of national. But what is chiefly rethe interest. In this way, the markable, from our point of view, creditor acquired a double security is the system of financial co-opera-first, the land itself, secondly tion herein displayed. a system the capital of the Vindobona. which is destined to be ere long Next, land-banks were established immensely developed — until, in which advanced money on these fact, Europe shall become but one bonds or mortgages to their full country as regards industrial fiamount-thus rendering them ne- nance, the spare capital of each gotiable. Next it was seen that a country being drawn to common large and most profitable business centres, and seeking the best marmight be carried on by the purchase ket wherever that may chance to and re-sale of estates-purchasing be found. them in block, and re-selling them immediately in comparatively small portions, say of 100 to 500 acres. To accomplish this, the Banque de Credit Foncier et Industriel was established, which has agents all over Austria, who examine into titles and values, who find out proprietors ready to sell and small capitalists ready to buy, and in fact

This wealthy and busy precinct has a literature of its own-journals whose special task it is to record its operations and set forth its condition. But it has more than this; for the whole country takes an interest in its bulletins. In all our daily newspapers there is a department of news, never omitted, which is scanned with devout attention by

hundreds of thousands of readers, yet which is certainly not indebted for its popularity to any attractiveness of style or appearance. It is the driest column or columns in the paper. It is full of figures, and tables of figures (usually so repulsive to readers), preceded by a few paragraphs, seemingly of a very stereotyped aspect, and couched in language peculiar to itself. Therein we read of "Consols for delivery," "Reduced and New Threes," "Turkish Consolidés," 66 Danish Scrip,' Greek Coupons," "New Granada Deferred," "Spanish Passives," Russian Threes," Chilian Sixes," and other such things hard to be understood by the uninitiated, however conversant they may be with the grammar of Lindley Murray and the Dictionary of Dr Johnson.

[ocr errors]

66

66

We

also read that "the market is easier," or that it "opened flat," that it "assumed a more lively appearance," or that it "showed a falling tendency," or "great depression." This never-omitted and much-studied portion of the paper is the City article, in which the health and spirits of the Money Market are described pathologically; and the price of stocks and shares, and the condition of all established companies quoted on 'Change, are carefully recorded. A single glance at this portion of the Times' will show the magnitude and variety of the enterprises quoted on 'Change. Besides the loans to foreign governments, there are upwards of 600 kinds of stock or shares in the official list, connected with railways, mines, docks, jointstock banks, colonial government securities, and miscellaneous enterprises.

[ocr errors]

The City article is no longer read merely by a particular class of the community. All classes, and all places in the country, have a direct interest in the facts which it records. It is read with interest not merely in London, Liverpool, Manchester, Birmingham, Glasgow, and the other great centres of industry, but even in uncommercial cities like

Edinburgh, where men live by the learned professions only, and who scorn trade in the old sense of the word. In truth, nearly all men in this country are traders now, though many of them trade as it were by proxy. The joint-stock system of enterprise has of late years drawn the whole community into its vortex. As a nation, we have grown very rich. It is computed that the annual savings of the nation amount to the enormous sum of £80,000,000. Like thrifty men, we desire to employ that sum, our spare money, in the most profitable manner. Nowadays, too, we have the whole world open to us as a field of commercial and financial enterprise. In commerce, at least, nations are now brethren. No nation objects to the introduction of foreign capital to develop its resources. These two facts-the vast increase of wealth in this country, and the magnitude of the field open for its employment -have given an extraordinary expansion to the joint-stock system; an expansion which has been greatly aided by the passing of the Limited Liability Act. Previous to the passing of that Act, it had been proved by long experience that business could be conducted as ably by a board of directors as by a private firm. True, the management of a public company is never so economical as that of a private firm, and the supervision of a salaried board of directors is seldom so vigilant as that of private partners, whose whole fortune is at stake in the concern. But, on the other hand, a joint-stock company obtains the command of a far larger amount of capital than private firms-which gives it a great advantage; and, moreover, in many cases, it is insured of a large amount of business, in consequence of its shareholders being also its customers. Take, for example, the case of a joint-stock bank. It may have a thousand shareholders, and all these shareholders are its customers. They have not only subscribed the capital by which the business is carried on, but they intrust

all their money to its keeping, and get all their loans and discounts from it. In this way they make business for it, and at the same time share in the profits of that business. They not only get from it the usual interest on their deposits, and the usual advantages of monetary accommodation, but they share in the profits which arise from this form of business.

The Limited Liability Act has greatly lessened the risk incurred by shareholders, by limiting the liability of each to the amount of capital for which he has subscribed. Shareholders are now comparatively at their ease. They elect from their own number a Board of Directors, whom they pay for conducting or at least supervising the business of the company, and they know that at the worst they cannot lose more than the sum which they have chosen to subscribe. The system, on the whole, has worked remarkably well. It is also accomplishing a revolution in the ideas and financial habits of our people. It offers a higher rate of profit than the interest obtainable upon deposits in banks, and thereby more effectually puts an end to hoarding, extends the spirit of enterprise among all classes, and draws into active use the whole spare money of the people. Clergymen, lawyers, doctors, noblemen, and tradesmen alike, now become shareholders in joint-stock companies. Each, while pursuing his own calling, invests his reserve funds in some financial, trading, or industrial enterprise. He thus obtains the profits of another trade while following his own. We are at the outset of a new era in social progress, and one which is probably the highest to which material civilisation can attain. It is the era of Co-operation. Hitherto Competition has been regarded as the most efficient agent of social progress. But the principle of competition is one of rivalry and struggle-it is a system of beggar-myneighbour-most useful in the earlier stages of civilisation, but one most unworthy of civilisation in its maturity. It is costly, for it re

quires many companies and establishments to do the work which would be more economically performed by one; and it is full of social unhappiness, and fruitful in the bitter feelings of rivalry and jealousy, because each establishment seeks its gains at the expense of the others. The new system of co-operation, on the other hand, seeks to unite and fuse into one the hitherto rival interests of the trader and his customers, of the consumer and the producer. Take for example the case of a company for the supply of gas, or water, or any other necessary or luxury of life, and there you find that a large portion of the customers are also shareholders. By-and-by the system will be more fully developed, and the social advantages will be commensurately increased. Say that a little town is desirous to supply itself with gas or water; then a company will be formed, with a capital apportioned in many small shares, so that nearly every householder may be a member. In this way the company will insure for itself the largest possible number of customers-opposition and jealousy will disappear, and the little community will have but one interest in the matter. In like manner, also, a town may supply itself with bread, or groceries, or butchermeat, or any other article for which there is a general demand. The employés, too, of the company, by holding shares in it, may be made to participate in its interests, and to discharge their duties with more scrupulous diligence than is usually to be found in a hireling or salaried agent. No doubt the time is still distant when the system of co-operation shall reach this development; nevertheless, its coming may be calculated upon. And thus, at the present hour, we are witnessing the initial stage of a principle which will revolutionise our system of industry, and accomplish results fraught with a vast increase of happiness and prosperity to the community.

Large as are the annual profits of our nation, it seems beyond doubt that a considerable portion of the

« ПредишнаНапред »