t all loans, whether cash loans or stock loans,
should be figured at this level. The making of any prices below those
of July 30th was to be resisted by every available means, and the
money-lending institutions were to be urged to cooperate by
recognizing them as a basis for exacting margins. As long as this
policy could be successfully carried out the danger of financial
collapse would be averted.

It having been ruled that a lender of stock, by notifying the borrower
of his willingness to take the stock back, could stop the interest
charge on the contract, a considerable demand arose for new stock
loans to replace those in which this privilege had been exercised. The
matter of facilitating these new stock loans was taken up by the Stock
Exchange Clearing House, and this together with the negotiations for
voluntary settlement of back contracts now brought upon the Clearing
House Committee that great volume of work which increased steadily
until the reopening of the Exchange.

One step tending to increase this work was taken on August 11th, when
the Committee ruled as follows:

"Whenever a loaner of stocks gives one day's notice of
willingness to have the same returned and the borrower fails to
so return, the interest thereon shall cease. The Clearing House
of the Exchange is prepared to advise and assist in making new
stock loans and inquiries should be made in person there."

The effect of this ruling was to create a borrowing demand for stocks
at current interest rates and the Clearing House Committee became the
agency through which these stock loans were negotiated.

A further ruling, on August 11th, relative to the interest rate was to
this effect:

"That on all loans of stock made between members after this date
the rate of interest is subject to agreement between the parties
to the transactions, but should not exceed 6 per cent."

By the eleventh of August the question of the growth of an outside
unregulated market began to force itself upon the attention of the
Committee. All the organized Stock Exchanges of the country were
closed, the auctioneers had loyally agreed to abstain from making
sales, the "Curb" or recognized outside market was faithfully
cooperating to prevent dealing, the unaffiliated bankers and money
institutions were refraining even from the private sale of bonds in
which they were interested, so that for a brief period there was a
practically com