Table Of Content

The magazine of the Museum of American Financial History TORY H I The Dramatic Story Enmeshed in the Gibbons Collection A Glimpse at the Neighborhood of America’s Early Money Masters The Tokyo Stock Exchange’s Gallery ofJapanese Scripophily Issue 6 z ~ Spring 1998 Herzog Heine Geduld NASDAQ Market Making For The Institutional Investor Everyinstitutional investorisunique. However,allofHerzog HeineGeduld'sinstitutional clientsenjoyidentical benefits: unparalleledexpertisein themovementofblocksandoutstanding personal service. Manytopinstitutional investors have alreadymadetheleapto HerzogHeineGeduld-oneofthemanyreasonswe consistentlyrankamongthetop threeinstitutional blocktradingfirms. We've earned our stripes. Quietly. ESTABLISHED 1926. BRAD ZIPPER, NASDAQ MEMBEROF THE NEW YORK (800) 221-3600 STOCK EXCHANGE/S1PC. 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Box/46, Hollis, New Hampshire 03049 CALL: 800-71 7-9529 or 603-882-241 1 FAX: 603-882-4797 Financial 1 istory Issue 62 ~ Spring 1998 Financial History Financial HISTORY The magazine ofthe Museum of American Financial History Issue 62-Spring 1998 Features (ISSN 0278-8861) Thomas Who? 20 Kristin Richard Editor The legacy ofthe Gibbons family and the pieces offinancial history Alan Barnett, Inc. Art Direction they left behind By Robert Carver EditorialAdvisory Board 18 On the Road to West Egg Dan Cooper Marist College A look at the neighborhood of Diana E. Herzog America’s early money masters R.M. Smythe fie Co., Inc. By Jim Romeo Douglas Parrillo Parrillo Communications, Inc. 26 Scripophily in Tokyo Arthur W. Samansky The TSE’s lonely gallery of HSBC Americas, Inc. Japanese scripophily Bob Shabazian By David Baeckelandt American Stock Exchange Richard Sylla 28 Unlimited Scope to Enterprise Henry Kaufman Professor ofthe History ofFinancial Institutions The Gibbons vs. Ogden case and and Markets, New York University domestic economic development Jason Zweig By Robert Wright Columnist, Money Magazine 32 Scottish Investment Trusts Museum Staff Financial frontiersmen in Diane Behrens, Executive Director Meg Ventrudo, Associate Director the emerging U.S. Jim Festa, Public Information Officer By John E. Newlands Copyright 1998 bythe MuseumofAmerican Financial History, publisher, 28 Broadway, New York, NY 10004-1763. Telephone: 212-908-4519,fax: 212-908-4601.All rights reserved. Permission is granted to reprint On the Cover with propercredit to Financial History. Four issue subscription $25 in U.S. and Canada. $30 airmail Europe, U.K. Single Portrait of Thomas Gibbons. copy $7.00. Payment must be made in dol- lars, bycreditcard, or bank wireto Republic National Bank, Four World Trade Center, Plaza Level, New York, NY 10048 ABA #026-004828,Account#456-022430. Letters to the Editor are welcome; please send them to Financial History at the above address. Website: www.mafh.org Issue 62 -Spring 1998 Financial History 3 8 i^s getting harder and harder to tell one clearing firm and reporting, as well as our competitive pricing, from another...at first glance, that is. Dig beneath the utterly irresistible. If it’s results, not appearances, you surface, however, and you'll see why more than 280 find appealing, the obvious choice is U.S. Clearing Coip. financial institutions find U.S. Clearing Corp.’s prompt, We now provide $50 million in accountprotection accurate real-time trade processing, record keeping foryour clients! g US.Clearin Member New York Slock Exchange, Inc. 26 Broadway • New York, NY 10004-1798 rlNANCIAL STORY Issue 62. - Spring 199 Financial History Trustees Edward Altman I. Max L. Heine ProfessorofFinance NYUStern School ofBusiness, NewYork, NY Thomas Asher J. Regional Director, ExecutiveVice President The Robinson-Humphrey Co., Inc. GA Atlanta, Departments Molly G. Bayley SeniorManaging Director, DST Catalyst, Inc. 6 People & News Chicago, IL Founder’s Report ChairmanW,ilClEiOam,PE.rBnesthr&ensCompany By John E. Herzog New York, NY The Museum participates in the SEC’s “Facts on Saving RandyCepuch and Investing Campaign” with a week-long series ofguest Vice President Communications, Fund lectures by prominent historians, authors and leaders in Management Division Capital Research the field offinance. & Management, Washington, DC Dan Cooper 12 Educators’ Perspective NY MaristCollege, Poughkeepsie, Allan A. Ryan and the Ultimate Short Squeeze Stephen A. Cooper By Brian Grinder 6c Dan Cooper President,Nemco Brokerage, Inc. New York, NY 14 Author’s Journal A New Look at the American Revolution Jim Getz CEO, Federated Investors, Inc., Pittsburgh, PA Part II By Thomas Fleming Richard Gregg President, Bond and Share Society Hackensack, NJ 16 Book Review The Rich Rich John E. Herzog Chairman, HerzogHeine Geduld, Inc. The Story of the Big Spenders New York, NY By Ray Boas Thomas D. Levis Managing Director, Investors Company 30 Auction News New York, NY Preparing for an Auction: Tips for Beginning Bidders Gordon S. Macklin By George Teas Chairman, White River Corporation MD Bethesda, 40 From the Collection William M. Pinzler, Esq. New York, NY MortonJ. Wagner Every Issue Executive V.P., Salomon Smith Barney Inc. New York, NY 31 Financial History Trivia Quiz John L. Watson III PresidentEmeritus, SecurityTradersAssociation 36 Summer 1998 Events Calendar Ponte Vedra, FL John Westergaard 37 Shopping Guide Westergaard Publishing, New York, NY 38 Collector’s Marketplace Jason Zweig Columnist, Money Magazine, New York, NY Martin E. Zweig Chairman and President,The Zweig Funds NewYork, NY Issue 62~Spring 1998 Financial History 5 Founder’s ferent speaker each day. The objective staff to have everything ready. By the of the writers and financial historians end of the week, we were Report all who spoke was to add perspective to exhausted but happy, as we received the markets by presenting some inter- many compliments on the program. esting historical facts and entertaining As a result of this experience, we ByJohn E. Herzog anecdotes to illustrate the foibles we are now planning other lunchtime share as investors. These were very offerings, although not five in the It has been party time around well received, and featured a star stud- same week. We will begin with one the Museum lately, as we have broken ded cast of Marty Zweig, Tom each month and add to that schedule new ground with two important cele- Fleming, John Steele Gordon, Ron as we fill in our calendar with special brations. The first was the birthday of Chernow and Martin Fridson. Their events, so that eventually we will have Wall Street, March 13, 1653. As we books were on sale at the Museum’s a meaningful and regular lunchtime commemorated the 345TH time new gift shop, and many autographed schedule. We will continue to serve around, Dick Grasso accepted the first copies were sold. The lunchtime pre- sandw—iches at noon for each of Wall Street Anniversary Award to sentations took place in the new these so there is a ‘free lunch’ after Louis Rukeyser. Rukeyser became the meeting room above the gallery, the all! Please watch our website for first “Hero of Wall Street,” and result of a ‘just in time’ effort by the more. BD though he was not able to be with us for the event, he sent a fine video The Museum of American Financial History is the newest acceptance speech, greatly enjoyed by public repository of documents, stock and bond certificates, the audience and now on our website engravings, and other historically significant artifacts dedicated at mafh.org. A special trophy was to the origins and history of the American capital markets. MUSEUM designed with “Charging Bull.” The Museum is located at 28 Broadway, New York City. To mark the SEC’s initiative of a AMERICAN Hours: 11:30 a.m. until 3:30 p.m., Monday through Friday. week-long hemisphere wide event on FINANCIAL Admission is free, and special hours can be arranged for behalf of “The Facts on Saving and HISTORY group tours. For further information, please contact Investing,” the Museum presented a dif- the Museum at 212-908-4519. A New Name In Scripophily As The International Bond & familiar as ‘numismatics’ and ‘philat- Share Society enters its 21st year, ely,’” Robinson said. the Society has renamed its quarterly The first edition of the magazine publication. The magazine, previously under its new name includes reviews known as the IBSS Journal, is now of 10 recent auctions, as well as arti- called Scripophily. cles on The Bank of North America The word “scripophily” was coined and a Standard Oil stock signed by in 1978 for the collection and study of J.D. Rockefeller that sold at auction defunct stocks and bonds. Ted for $61,000. Robinson, American editor of The magazine’s editorial team also Scripophily, said the editors were leery recently underwent some changes. about using the one-word name when Howard Shakespeare retired as editor they launched the magazine 20 years after 11 years in the position. He will ago, since the term was not yet well continue at the magazine as European known. But now, the name has caught editor. Ted Robinson is the American on and is widely accepted and used. editor, and Brian Mills is now the “Today, it [‘scripophily’) is as managing editor, na Financial History Issue 62 -Spring 1998 * - Additions to the Collection — M i-lU"iO»f>1froLJ////tflf»t/»jajBirhSut.-gf/fiwMfMf:tcfh^u. _•1IbCfki1s2x,*.idf£-0J1f>fo7£*.$V±Io>17_c— -•5rAf»JrJt7y7-£*S*fTtuJ.•Tit.i.fH/?.3o'.A,n/ftt>tU*7-JifJ t'un* /%/UtA•>1tfc«7/li//fAJ//"/r///ht.i.*nfrT'±>!tH/g/j-tsy? utS£4f.•*ZE3f*jf1a.Yf..r2*i?fSfe*7IL />tJ>X>ut>U2yC*tl4*S*//Pi+ff3X7Ub/f..jfttt.Pdit<X£iS2f^fs*ts7t*tofSsj\ Si.t%'AO7*iK0t1rtgWf7/79s6/7.t/i/ofm/l/hu/////f1//n'uti''n/ftfS77¥tftS?n’ p re.rt3zAAAAAZf9?t3,.-.i.....fC*/1¥>xAka*>*'+1?5b/?rrr>5 iiS233?33)pii3si2fX>*/*3“qfSffj2)-nL72+H0.ltbl3>n.WU.hn...,...J..iSit.f?Strscs-s2t“li}iqiisti/g tfl‘tli «*.rr _*i/rrist’ */s7f/S X>J*S&.•s*r0 /i/Z/fttt?” £+.3/ KtS<lSC J3Hftm> 1.2f4t tfo Of — z.**- 3tc.it 1l~ “1 /.tf— 1m*i1'tf •fdY i . - /4j*7 _ 1 \.gf n'fit £ vV>it % i. ¥.. , p: ^-T SM — ...7J UK I I/TJf ' *“ iti 1 ^57 * /17-tf id-m.fi y/.fcr If n.i ei£- i-tCf-C fi?'1 /s& iij.v *?.*< *7* t^.C S/1 Z?M/.J*- y-^T J&J-- HsfntJ.to/— tx1' Ht.fi « jfCtJi 4 w . ; ?!& M' lUl> y. \ j,*s£a UOir‘-'> ic.f Id-*'- 7,4f , nr *? ^ fey />--*f ycAT- iffi* One of the Museum’s most recent acquisitions proves Top right: The Museum acquired this vignette proofofan airplane, along the stock market is not only for Wall Street tycoons. Shown wenigtihnoetehreirnsg,aantdauocitlifoinn.diBnogt.tLoemftr:igEhxta:mLpuldewsiogfBLlauud,wihogldBelrauofs5s3topcaktecnhatrstsi.n here are examples of the stock charts of Ludwig Wilhelm Blau, a geophysicist from Houston, TX, who was president of the Texas Academy of Science and a holder of 53 patents Grace, donated the collection of his financial records to the in engineering and oil-finding. An example of his work on Museum in March. the torsion balance used in oil finding is at the Smithsonian Other donations to the Museum include a certificate for Institute. Blau emigrated from Germany to the U.S. in 1909, one share of the Lake Copper Company signed by William and his family settled and farmed in the Texas Panhandle. Alfred Paine, a gift of Larry Falater, and a framed print of In 1922, he began college and eventually received a Ph.D. the NatWest Markets USA Trading Floor from LesJohnson. from the University ofTexas at Austin. Blau’s interest in the The Museum recently purchased at auction vignette proofs stock market began in 1929 and continued until his death and photographs of airplanes, as well as a certificate for in 1978. His daughters, Margaret B. Clegg and Esther B. 66 ~h shares in the Fraser Logging Company. Ha ssue 62~Spring 1998 Financial History Museum Names Museum Rukeyser Exhibit First Schedule “Hero of Wall Street” Winter 1997 Rags to Riches The Financing of America, Clockwise startingabove: Dick Grasso accepted thefirstannual “Hero ofWallStreet” 1776-1836 awardfor Louis Rukeyserat the Museum March Urban historian Steven H.Jaffe signed copies ofhis book, Fall 1998 Who Were the Founding Fathers?, afterhis talk on the development ofWallStreet. IPOs The Museum celebrated WallStreet’s 345th birthday with a cake donated by Ferrara's. How Companies Go Public The Museum named Louis of a better person to receive this Spring 1999 Rukeyser the first “Hero of Wall award,” he said. “It was Louis Financial News is News Street” at a celebration commemorat- Rukeyser who truly brought Wall How Wall Street Communicates ing Wall Street’s 345TH birthday on Street to Main Street.” March 13. More than 65 people The birthday celebration included Fall 1999 attended the event in the Museum’s a slide show presentation on the Derivatives new lecture and meeting space above development of Wall Street from the from Biblical Days the gallery at 28 Broadway. 17th century through the 1840s by to the 21st Century Dick Grasso, chairman of the New Steven H. Jaffe, urban historian York Stock Exchange, accepted the and senior historian of the South Spring zooo award on Rukeyser’s behalf. Rukeyser, Street Seaport Museum. Following host of the nationally televised “Wall the speech and award presentation, American Business at the Street Week,” delivered his acceptance Jaffe signed copies of his book, Turn of the Century 1800 — 1900 — 2000 speech via videotape. Who Were the Founding Fathers?, Grasso praised Rukeyser for his and author Charles Geisst signed efforts to bring the world of finance Wall Street: A History. Birthday and investments to a level most cake and coffee were served at the Be sure to visit our gallery Americans can easily understand and reception. at 28 Broadway. relate. The event was co-sponsored by the “Wall Street and Main Street are Museum and The Bowling Green today one and the same. I can’t think Association. 133 Financial History 8 Issue 62 - Spring 1998