Bailing out the Bucket Shops

Chronicles ^ | June 3, 2009 | William Quirk

[parsifal]

In the 19th century many American cities had what were known as bucket shops. A bucket shop had a New York Stock Exchange ticker and would post quotations as they came in. Rather than buy the stock, the customer bet on the tape—e.g., 20 shares of sugar at $100. The shop took a commission: If the stock went to $105, the shop paid; if it went down, the customer lost. Customers could also short a stock. Edwin Lefèvre’s 1923 classic Reminiscences of a Stock Operator vividly describes the turn-of-the century bucket shop. The shops were partially blamed for the Panic of 1907, and the states outlawed them shortly after that. Of course the New York Stock Exchange, where customers bought the underlying assets, continued to be legal.

[parsifal]

I keep stumbling across new information and new aspects on the meltdown. Guess who legalized "bucket shops" in 2000?

parsy, who keeps plodding along

[parsifal]

These links might also prove informative:

http://www.cbsnews.com/stories/2009/08/19/60minutes/main4546199.shtml

http://www.bloomberg.com/apps/news?pid=20601109&sid=agFM_w6e2i00

http://www.nakedcapitalism.com/2009/03/eric-dinallo-we-modernised-ourselves.html

parsy, who is preparing for Wall Street’s “don’t regulate us” blitz

[the invisib1e hand]

"bucket shops," by definition, are an "off Wall Street" phenomenon.It even says that in the excerpted paragraph.

Bump for later, at which time further comments may be necessary.

[the invisib1e hand]

here: < /i >

[Mister Muggles]

Bucket shops are still alive and well...a good 95% of all retail Forex brokers are bucket shops.

[A Strict Constructionist]

Most scandals where it’s in sports or stocks are related to gambling. I think we need new Kefauver hearings on “Organized Crime.” The Mob and WS would be shaking in their boots. We might find that they are one and the same.