The New York Stock Exchange in the Crisis of 1914 Part 6

It is instructive, as showing the workings of some minds, that although the Committee of Five, in its capacity of regulator of minimum prices, issued a public statement that they were under no circ.u.mstances going to valorize or sustain prices but merely expected to maintain a safeguard against some unforeseen shock to confidence, many people wrote them urgent letters asking that in certain properties a minimum should be maintained which would render selling impossible. It was quite futile to try to disabuse some of these correspondents of the idea that no decline should be allowed in properties that they were interested in.

To one who meditates upon the singular experience which was thus abruptly brought to a close, there are a few features of it which stand out as meriting the especial attention of all members of the Stock Exchange. First of all it was most impressively shown what apparently hopeless tasks can be accomplished by loyal cooperation. If at any time up to July, 1914, any Wall Street man had a.s.serted that the stock market could be kept closed continually for four and one-half months he would have been laughed to scorn, and yet this supposed impossibility was performed by the joint and determined action of the financial community. On the other hand, and as a counterpart to this valuable experience, it must never be lost sight of that the extraordinary war measures of 1914 may be a danger to the future if they are misinterpreted. There is a possibility (even a probability) that when ordinary crises arise in times to come, people who find themselves financially embarra.s.sed will bring enormous pressure upon the authorities of the Exchange to renew the drastic expedients of the famous thirty-first of July. It is to be sincerely hoped that there will always be firmness enough in the Governing Committee to resist this pressure. The great world war coming, as it did, without warning was a rare and epoch-making event that warranted unheard of action and to indulge in such action for any lesser cause would be utterly disastrous.

The Committee of Five seems to have been brought into existence under a lucky star. That five men called together so suddenly in such an emergency should have worked with absolute harmony for so long a time is quite remarkable. Their unanimity was never troubled but once. On one of the first few days of their career a rather positive and aggressive member, arguing with a colleague, said "you must remember that you are only one of this Committee." The Committeeman thus addressed responded with calm determination "and you must not forget that you are not the other four." This encounter excited much amus.e.m.e.nt among the remaining members and was the one and only occasion where anything resembling a serious difference appeared.

In addition to being blessed with harmony they were very fortunate in having pa.s.sed rulings for so long a time without giving forth anything that had to be recalled. In view of the complexity of the conditions, fortune must have aided in this as well as judgment. They were, of course, treated to much wisdom (after the event) by their critics.

They were told that they might have opened the Exchange sooner after the actual opening had proved a success, and they were informed in the editorial columns of a prominent journal that their fear of foreign liquidation had been an "obsession" which lacked justification. These critics never were heard from while the event was in doubt, and consequently the Committee did not profit much by their learned sayings.

It can be stated with confidence that the intelligent resourcefulness of the Stock Exchange, in conjunction with the splendid public spirited work of the New York banks and the press, warded off a calamity the possible magnitude of which it would be difficult to measure. The success of this undertaking should be a source of pride and emulation to those future generations of brokers who will have to solve the problems of the great financial market when in the words of Tyndall, "you and I, like streaks of morning cloud, shall have melted into the infinite azure of the past."

THE END