Bob Cratchit Hours

On Wall Street, 1967 may well be remembered as the year of the brokerage-house Bob Cratchits. Responding to brokers' cries that their clerical ranks were folding under the paperwork generated by this year's unprecedented pace of trading, governors of the New York Stock Exchange last week held an emergency Monday meeting, ordered a "temporary" shortening of daily trading sessions from the normal 51 hours to four hours. The shorter hours, which are scheduled to continue through this week, were matched by the Big Board's smaller Manhattan neighbor, the American Stock Exchange, as well as the nation's seven regional exchanges.

As the change went into effect, the Big Board's outgoing president, G. Keith Funston, warned brokers that they would have to start staying after school. "We are expecting our members," he said, "to use this period of curtailed trading hours to concentrate on clearing up the existing problem."

Traffic Jam. The problem is the result of volume that has a big plus side in rich brokerage commissions. Compared with last year's record average of 7,500,000 shares a day, trading on the Big Board has surged to a dizzying 10 million shares a day--a level that the exchange just two years ago predicted would not be reached until 1975.

The current crisis--and brokers' calls for relief--peaked two weeks ago, when the Big Board shuddered to two 13 millionplus share days in a single exhausting week (TIME, Aug. 11). As an unwanted result, said one Manhattan broker, paperwork in brokerage firms was backed up "like the Long Island Expressway in rush hour."

The traffic is piling up in the brokers' "back offices," where batteries of clerks clear transactions and update customer accounts. When the surge in trading volume turned into a tidal wave, a number of understaffed brokerages were soon trying to explain delays and trying to do something about botched paperwork. At Philadelphia's small Gerstley, Sunstein & Co., Partner Thomas McCann is finding that staffers who have been putting in 15-hour stints "can't do this day after day without a degree of fatigue and a rising incidence of errors." At Manhattan's big Bache & Co., Vice President William Carey says that a second clerical shift hired by the company last fall "has been our savior."

Nowhere has the back-office bottle neck grown more painfully acute than in the so-called "cashiers' cages," where mountainous sheaves of stock certificates are received, sorted and delivered each day. Coming in all sizes and formats, the certificates so far defy automation's demand for uniformity, and so arcane is the art of shuffling them among brokerage houses and customers that experienced clerks are prized people who can earn five-figure incomes.

Not only are cashiers in short supply; banks that act as transfer agents have sometimes run out of certificate blanks for certain actively traded companies. "It's getting to the point," says one executive at Merrill Lynch, Pierce.

Fenner & Smith, the nation's largest brokerage house, "where we just can't get our hands on the securities we buy and sell."

Sooner v. Later. Brokers expect to get some relief when a central certificate system is set up, possibly next year. That will enable transactions to be recorded at a single data-processing center and eliminate the need for physically transferring securities each day. Another possibility, though still a long way off, is a standardized stock certificate that could carry magnetized data and be read by machine the way bank checks are.

In all likelihood, the market will force such changes sooner rather than later. Although trading on the Big Board dipped slightly to 8,970,000 shares during the first of the short sessions, it was right back up to 10.1 million shares the next day.

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