Like every other industrialized country, the United States needs an investor's capital market. The inability of the Stock Exchange in its present form to cater for these requirements shows itself clearly in the rapid growth of an investment market outside the New York Stock Exchange and independent of it. Federal Government, municipal and State bonds, which are the backbone Of an investment market, are not quoted on any Stock Exchange in the country; in Industrial bonds almost the entire business is done outside the Exchanges in the over-the-counter market, although the majority of them have a nominal Stock Exchange quotation.
One result of this condition is the deplorable confusion of the investment market. Without a central place of exchange only the very largest bond issues command a free market, Quotations for many municipal bonds, even for those of big towns, are difficult to obtain; and the spreads are wide. Most of the over-the-counter dealers are nothing but salesmen for new issues and are, therefore, only sellers, unable and unwilling to buy bonds from the invester once the issue has been completely distributed.
Text read from the printed page and cleaned; old type leaves the occasional error.