In order to possess the right to buy or sell securities upon a stock exchange, one must be a duly elected member of the same, pay his initiation fee, and share in the assets and liabilities of the exchange. His interest, instead of being called a share of stock, is called a "seat." A "seat" may be, as in the case of the New York Stock Exchange, very valuable,1 but varying in price, in accordance with the activity of the exchange; that is, the amount of business being transacted; which naturally affects the demand. The owner of a "stock exchange seat" may transfer or sell to another person by permission of the proper authorities of the exchange. The owner of the "seat" has no right, in any way, to charge commissions for the sale or purchase of securities, otherwise than in accordance with the established rules of the exchange; rates are less between members than for others; for instance, John Smith owns a "seat," but does not wish to actually go upon the "floor," as it is called, of the exchange, to personally buy or sell securities; he may employ some other member to act for him to whom he pays a reduced commission amounting to $2.00 l for 100 shares. From this arises the term " two dollar man."

1 Up to Jan. 1, 1921, the record price on the New York Exchange was $115,000, but in 1871 the quotation was as low as $2,750, and in 1896 down to $13,000. Up to the present time - January 1, 1921 - the price on the Boston Exchange is $38,500. The initiation fee upon the former is $2,000 the latter $500. Unless for some reason an exchange increases its number, of members, a "seat" must be purchased from some member who is willing to sell, or from an insolvent, or the estate of a deceased member.