"The New York Curb Market… Which has No Organization Whatever”: The Enclosure of New York’s Last Outdoor Stock Market, 1900-1921
By Ann Daly
Visitors to the New York Curb Market, located on the Broad Street sidewalk, also called “the gorge,” found themselves overwhelmed by the noise and frenzy. Hundreds of men on the street “writhed, leaped, swayed.” In New York’s last outdoor stock market, where orders were communicated by yelling or signaling out a window and anyone with lungs could trade, financial journalist Edwin C. Hill claimed in 1920, “some of those whirling dervishes down the street could borrow a million on their moral credit; for others the jail beckons.”
To Hill, it looked like hell. “Fingers in sets of two, three, and five at a time… shot up vertically or spanned horizontally sideways in mad play,” while in the buildings overlooking the street, “windows were popping with grimacing faces — female, it seemed, as well as male — with grotesque and distorted features… with arms and hands that leaped from a mysterious interior to convey cryptic symbols to the upraised eyes of the leaping creatures in the gorge.” In this mysterious market where men wore garish coats and hats, “demon knew demon by the color of a head-dress.”
If the visitor looked closely, Hill claimed, they could see the Curb for what it really was: a functioning stock market. On the street, the machinations of finance were visible to all. The Curb, it was said, “is finance set to jazz music.” It was “money doing a shimmy.” The grimacing faces above the street were brokerage house clerks tasked with manning telegraphs and telephones indoors and communicating orders to their traders in the market below. Four young boys sat in each window with their legs dangling out, and brokers knew which boys belonged to each house, and therefore where to look for their orders. Men stopped trading to throw things at each other, harass passing newsboys, or whistle at a pretty woman. They often had to dodge traffic while conducting business. Neither snow nor rain prevented traders from trading stocks and bonds on the street, year in and year out. Yet less than a year after Hill introduced his readers to the market, this public Spectacle ceased to exist. On June 27th, 1921, the Curb abandoned its place on the street and moved into a new building on Trinity Place, where it would become, by midcentury, a financial powerhouse called the American Stock Exchange (AMEX). 
The concept of an outdoor exchange is old — The earliest European stock exchanges formed out of doors in the seventeenth century — but most exchanges moved indoors as quickly as possible. In New York, the New York Stock Exchange formed in 1792 with signing of the Buttonwood Agreement, named after the buttonwood tree the traders were supposed to have met under. By 1793, however, trading had moved into the Tontine Coffeehouse. As an outdoor stock market that persisted into the twentieth century, The Curb Market was an odd anachronism. Its existence begs two questions: Why did the Curb stay outside from the late 1860s until 1921, and why did it finally abandon the street for the comfort of four walls? Surely, it wasn’t a desire to get out of the rain, or they would have moved inside well before 1921. Instead, the Curb Market used public space to lend credence to its claim that it was not a formal securities market, and therefore could not be regulated. In the aftermath of the Panic of 1907 and a rising tide of public scrutiny of securities markets drew increasing attention to the speculative dealings on the Curb, some Curb brokers began to find their outdoor environs and openness to be a hindrance, and eventually the market traded its informal status for a codified set of rules and regulations, which necessitated a move indoors.
The Curb, the Sidewalk, and the New York Stock Exchange
Outdoor exchanges lacked spatial controls which regulated access to trading and were therefore seen as less legitimate than those exchanges, such as the New York Stock Exchange (NYSE) or the Chicago Board of Trade, that had decades earlier gone inside. By taking cover on New York City’s streets, the New York Curb Market evaded regulation and served as unofficial market where New York Stock Exchange brokerages could participate in more speculative transactions. Outside, the Curb consciously rejected the institutional trappings that signified an organized securities market. Because anyone could simply walk up to the market and trade with any other trader, the market could plausibly claim to not be an organized securities market, but simply a group of people who simply gathered to informally trade in anything, and therefore, not an organization that could be regulated. As the New York Times put it, “Any man with a good pair of lungs is free to trade there so long as he keeps good his contracts.”
The Curb was not just seen as an unorganized, informal, and semi-illegitimate market: it kept itself that way in order to preserve its relationship with the NYSE. The NYSE used the Curb as an unofficial ‘seasoning market,’ or place to test out new issuances. Although the relationship was never formalized, the Curb was widely accepted by the NYSE as a preliminary market for newly issued or speculative securities, and was what is now known as a small-cap market. The best stocks, including Coca Cola, General Motors, Shell, Standard Oil, Goldwyn Pictures, and Phillip Morris, started on the Curb and quickly moved inside to the NYSE. Industrial and mining concerns were particularly prevalent, since new industrials and unexplored mines had significant start up costs, but were often unable to meet the NYSE’s requirements for listing that would give them access to the larger capital market. Other companies, like Standard Oil, had no interest in disclosing financial statements that might run afoul of anti-trust statutes and always traded on the Curb. By literally kicking risky securities to the Curb, the NYSE managed to preserve its reputation while still making a market for these more speculative stocks.  As one commentator in the 1870s put it, the Curb was the “flower which blooms in the garden of the regular board… feasting on remnants and odds and ends.” Even the Curb’s nickname, the “Little Board,” was a reference to the NYSE’s “Big Board.” Eighty percent of Curb orders originated from NYSE brokerages, and the big board countenanced the market as a place to trade in speculative securities and skirt NYSE regulations that banned some risky trading practices and demanded financial disclosures from listed companies.
Although the NYSE maintained the Curb as a place for speculation that would have otherwise been banned, it only allowed the Curb to exist so long as it did not compete for business. NYSE regulations banned brokers from trading on rival exchanges; brokers who traded on rival exchanges like the Consolidated Exchange would lose their seats. In order to survive, the Curb had to be able to plausibly claim that it was not a stock market.
In the aftermath of the Panic of 1907, the congressional investigation in to the causes of the panic, colloquially known as the Money Trust investigation, focused on the relationship between the NYSE, the Curb, and space. The Panic had started with the collapse of an attempted corner in the Curb Market, and the committee asserted that NYSE denied the Curb the institutional solutions it needed to prevent the kind of market manipulations that started the Panic so that NYSE brokerages had a place to engage in risky speculation away from scrutiny. The committee repeatedly demanded to know if the NYSE specifically prohibited the Curb from going inside in order to evade regulation, and implied that the NYSE forced them to trade in the rain or risk losing all of their business. Over and over again, committee members asked NYSE representatives one question: “Why the Curb does not get out of the rain into a building?” The answer of course, was that space was a heuristic for organization, and going inside would mark the Curb as an organized exchange that NYSE brokerages could not trade on without running afoul of the NYSE’s rules. 
Who is in Charge of the Market?
In the absence of institutional mechanisms for purging the market of fictitious sales and creating trust in the Curb market itself, one particular broker, Emmanuel S. Mendels, Jr., stood above all others. Referred to as ‘the father of the Curb,’ ‘Pop’ Mendels and his associates served in an ad-hoc fashion, making public judgments on membership, listings, and trading rules.  Although he lacked the power to ban particular stocks or brokers from the Curb, the Mendels’ stamp of approval helped bolster a new listing’s reputation, and his approbation would make other brokers wary of a suspicious newcomer. Mendels’ authority depended on his “sheer integrity and force of character” — personal characteristics that endowed the market he oversaw with a modicum of legitimacy.  Mendels codified his informal power by founding the Curb’s first governing body in 1908, The New York Curb Agency, but even that organization advertised the market’s informal status and went so far as to name its governing document The New York Curb Market Manual; Containing General Information regarding contracts, deliveries, listings, transfers, ETC. of the New York Curb Market which has NO ORGANIZATION WHATEVER. 
Without a governing body and spatial arrangement that allowed the Curb to police traders and exchange, the job of regulating boundaries of the market fell to the same organization charged with controlling the rest of New York City’s public spaces: the police. By 1905, the market had grown so large that it began to present a public nuisance. In the outside market, trading an embodied activity that was open to anyone with good eyesight and a loud voice. Traders were known for their physical talents. Curb brokers traded in all weather and were famously hardy, with one claiming that he was “rugged as a bear” and that it would take a “very large axe” to kill a Curb broker.  Even trading itself was a physical activity. Most traders eschewed the telephones and telegraphs of the indoor exchanges in favor of a secret set of hand signals.  Each brokerage or individual trader had his own sign language that they used to communicate with the clerks above the street, and these signs facilitated rapid communication, and kept incoming orders private. Orders originated with the street clerk, who manned telephone and telegraph banks in the office buildings that surrounded the market, and were the main conduit of information between the street below and the world outside. After receiving an order, the street clerk leaned out the window and signaled to his trader below, whom he identified by the design of his colorful cap and coat. The trader, who was often selected for his sharp eyesight as much as his quick thinking, executed the order and then signaled its completion to the appropriate window. Traders and clerks constantly “wig-wagged” back and forth, but stealing another trader’s hand signals was a violation of the implicit contract of the Curb. To observers, including Hill, the market assaulted the senses with its sound, movement, and color.
By 1905, some of the adjacent brokerage houses that transmitted orders through nearby windows were using megaphones to communicate with the street below. The Standard Trust Company, located on Broad Street next to the market, complained to the police. New York newspapers attributed the noise to the way the Curb conducted business, as it was the place where “the man with the leather lungs has the best of trading.” Upon consultation with a committee of four brokers, including Mendels, the city reached a compromise. Police Commissioner McAdoo, acknowledging that “the customs and traditions of the curb market have existed for a long time, and many of the men on the curb are connected with leading houses on the Street,” incorporated the Curb into a larger plan to ease traffic and congestion on Wall Street. McAdoo stationed two members of the traffic squad in the street to “herd the brokers within reasonable bounds” and remove loiters. He also roped off a section of the street, an “arrangement made for the restriction of trading to a specified area… with openings at intervals through which the brokers and messengers were allowed to pass.”  In essence, the police were tasked with deciding who would be allowed in to trade and who would be excluded.
Traders rebelled. Although there was never a referendum on the ropes, traders voted with their bodies and voices. This new spatial arrangement was not well received by the brokers, because it both marked them as no more prestigious than street vendors and disrupted the way the Curb did business. The Curb men expressed their distaste for their new confines: newspaper reports from the first day of enclosure claim that the Curb men crowded into the north end of their enclosure, as far away from the hotdog and lemonade vendors as possible. One trader complained to the New-York Tribune that the new spatial arrangements also had a negative effect on trading: the space was too small and overcrowded, so he was unable to push through the crowd to get between the north part of the sidewalk, where copper stocks were traded, and the south, where the gold stocks were, and consequently was going to have to give up his business in one of the metals. 
With McAdoo’s declaration that only traders were to be allowed within the ropes, it was up to the police and traders to negotiate the distinction between traders and the general public. One Monday in April, 1906, Callahan, the newly appointed Curb market policeman, had a dilemma: a young boy wanted to become a Curb trader, but Callahan did not know if he should be allowed into the market or not. According to the New York Times, shortly after the police roped off the market, a young man approached the ropes and declared his intention to trade in the market. Callahan rebuffed him, telling him to “take a walk” because there was “nothing doing for you in here.” The man persisted, however, and some of the brokers took him under their wing, telling him “if he’d yell loud enough the firms away up high would throw him orders out the windows.” Callahan again led him out of the ropes, but the boy protested, exclaiming, “I want to be a broker, and you can’t stop me.”  Callahan, unsure if learners were allowed in the market, compromised by allowing him to hang just outside of the ropes, and eventually the boy was employed by one of the brokerage houses as a clerk.
The move inside
After the Panic of 1907 and the ensuing congressional investigations, the Curb found itself under increasing public scrutiny and the Curb Agency introduced a series of reforms. Despite the best efforts of the Curb Association, however, it became increasingly apparent that the Curb could either be truly open or regulated, but not both. Plans to build a building began in 1916, and on July 27, 1921, the New York Curb Market officially began business in their new three million-dollar building on Trinity Place, just a few blocks from their old sidewalk.
The Curb’s move indoors was part of a broader regulatory program that signaled a larger shift in the relationship between markets and society. In its earlier outdoor form, the Curb was unregulated and dangerously risky institution, but it was also understood to be an open and democratic. As Hill explained, any white man could simply walk up to the market and begin trading, regardless of social status, wealth, or ethnic affiliation. In the first decades of the twentieth century and as stock markets became an increasingly important part of the American financial system, they because increasingly distinct from the rest of society. In partnership with state and federal governments, stock exchanges like the NYSE and the Curb implemented reforms regulations that were intended to bring stability to the market and prevent illegitimate speculators from gambling in the market. It was no longer acceptable for NYSE brokers to speculate wildly, even if they did so outside. In response to this shift, the Curb began to restrict membership, implement listing requirements, and closed itself off from the public by moving indoors. As more Americans began to invest in the stock market, physical and institutional boundaries mediated access to the market itself.
Ann Daly is a Ph.D. candidate at Brown University, where she studies the history of money in the nineteenth century United States.
 Edwin C. Hill, "The Strangest Stock Market in the World," Munsey’s Magazine, February 1920, 45-6.
; "The Deals and Ways of the New York "Curb"," New York Times, October 11 1908.
 William R. Sheerin, "The Newspapers Versus Wall Street," Michigan Manufacturer and Financial Record 1918, 6-7; Sobel, The Curbstone Brokers, 115-6; "The Remarkable Activity in Outside Securities," New York Times, January 1 1900, 28; Arsene Pujo, "Report of the Committee Appointed Pursuant to House Resolutions 429 and 504 to Investigate the Concentration of Control of Money and Credit," ed. House of Representatives (Washington, D.C.: Government Printing Office, 1913), 38; Albert W. Atwood, "On the Curb," The Saturday Evening Post, September 9 1916; New York Curb Exchange, America's Second Largest Stock Market: New York Curb Market, New York, June 1921 (New York: The New York Curb Market, 1921).
 Testimony of Mr. Mabon and Sturgis in Money Trust Investigation: Investigation of Financial and Monetary Conditions in the United States under House Resolutions Nos.429 and 504, before a Subcommittee of the Committee on Banking and Currency, Vol, 6 (Washington: Government Printing Office, 1913), 65, 470-75, 815.
 "Father of the Curb Dead," New York Times, October 18 1911, 90-93; Sobel, The Curbstone Brokers: The Origins of the American Stock Exchange.
 Hill, "The Strangest Stock Market in the World," 51.
 Emanuel S. Mendels, The New York Curb Market Manual; Containing General Information Regarding Contracts, Deliveries, Listings, Transfers, Etc. Of the New York Curb Market Which Has NO ORGANIZATION WHATEVER(New York: New York Curb Market Agency, 1909).
 Chapman, "The Curb Is Dead! Long Live the Curb!."
 "Curb Market Escapes Command to Move On," New York Times, June 17 1905; "Telephones for Curb Brokers.," New York Times, April 30, 1902 1902.
 "The Curb, Roped in, and Feels It Keenly," New York Times, June 27 1905.
 "Curb Brokers Roped In," New - York Tribune, 1905 Jun 27 1905.
 "He'd Be a Broker, Too," New York Times, April 9, 1906; "Curb Market Escapes Command to Move On."