Welcome to the Elsenbast Stock Exchange
ü Stock: a certificate that guarantees an individual partial ownership in a particular company or corporation ü Certificate: receipt showing ownership of one or more shares of a company’s stock ü Stock Exchange: place where buying and selling of stocks takes place
ü Stock Brokers: people who buy and sell stocks on commission ü Posting Value: value the stock is currently selling for ü Margin Buying: purchasing stock on credit-speculation ü Loan Sharks: loans money to investors, to allow them to purchase stocks on credit
Important Rules to Remember ü Trading Allowed Only When the Floor is Open ü Each Certificate =10 stocks ü $500 total to begin ü All trades must go through a broker (no personal trading)
ü Keep track of math. New prices are posted on the overhead each round. ü Interest rates on loans are locked at 50% annually
ü Role: sell stock to or buy stock from players ü Each broker responsible for one type of stock ü Each certificate = 10 shares, selling price = 10 x the posted value
ü You should have a class roster in front of you ü Keep track of the round in which you loan money to investors and when they pay their loans back ü Interest = 50% per year (you may need a slide rule!)
Kroger- Purchase a West Coast food chain New Stock Price Per Share $12 Radio Corporation- New model released w/ built-in antenna $13 Mammoth Oils- 9 wells begin producing in Wyoming fields $14 Gotham Bank- Bank declares a 6% dividend $11
New Stock Price Per Share Durant Motors- Fails to make payment on notes to the Gotham Bank $11 Midland Utilities- Midland extends services into Michigan and Wisconsin $13 Kansas Pacific- K&P will pay no dividends this year because of expansion into the South $9
New Stock Price Per Share Tel-Tone –Dial telephones will be installed in parts of New York city $15
New Stock Price Per Share Kroger- Merger with large Eastern chain of stores $15 Radio Corporation- 15 patents are purchased from the Edison’s company $14 Mammoth- Largest oil in America may be located under Mammoth oil lease in Teapot Dome, Wy. $19 Gotham Bank- Stock price remains the same $11 Durant Motors- Locomobile sales are depressed because of competition from Ford Motor Co. $5
New Stock Price Midland Utilities- Insull’s financial manipulation allows Midland to take control of Common wealth Edison $19 Kansas Pacific- Profits rise as agricultural shipments from Southwest begin the $10 Tel-Tone – New York Stock Exchange announces that Tel-Tone has shown the greatest Increase of any stock listed on the exchange $22
Special News Bulletin: President Harding is suffering from a coronary seizure and may have pneumonia. He is reported to be dying. The stock market will close 5 minutes for new postings. Harding Dies_ _ _ _ _ _ New Stock Prices Per Share Kroger $13 Radio Corporation $13 Mammoth $16 National Gotham Bank $10 Durant Motors $4 Midland Power $19 Kansas and Pacific $9 Tel-Tone $19
New Stock Prices Kroger- Corn blight on Kroger farms causes 90% loss of crops $12 Radio Corporation- Speculation on new patent causes rise in stock prices $15 Mammoth Oils- Japanese offer to but the total production of Elks Hills $21 Gotham Bank- French Government announces that they will begin to pay their WWI debts to U. S banks $12 Durant Motors- The Du Pont family brings to but large blocks of Durant Motor; s stock $7
New Stock Prices Midland Utilities- Insull fears Cyrus Eaton of Cleveland may be trying to take over Midland by purchasing large amounts of stock $22 Kansas Pacific- Speculation on increased profits from holdings in Mexico cause stock price to rose $11 Tel-Tone – Announces completion of successful merger. Speculation on market continues $24
Kroger- Speculation that Purity Markets are buying Kroger for an attempted takeover New Stock Prices $14 Radio Corporation- Rumored merger with the Edison Co. Causes stock to rise $17 Mammoth- Congressional committee begins in investigation of the Mammoth Oil leases. Possible fraud. $13 Gotham Bank- Bank stocks remain uncharged $13 Durant motors- Louis Chevrolet id hired to design an inexpensive automobile. $10
New Stock Prices Midland Utilities- Cyrus Eaton begins dumping large blocks of Midland stock on a depressed market $18 Kansas Pacific- Drought in the Southwest and depressed farm prices cause profits of K&P to fall $10 Tel-Tone – Drop of two points caused J. P Morgan selling 200, 000 shares. Seen only as temporary setback. $22
New Stock Prices Kroger- Food prices are depressed because of grain surpluses $13 Radio Corporation- Merger with Edison Co. falls through when Radio Corp. pays no dividends $14 Mammoth- Harry Sinclair is called before Congressional committee. Sec. Of the Interior Fall is indicated for fraudulent oil quarter. $7 Gotham Bank- Announces profits have increased by 5% over the last quarter. $13 Durant Motors- Announce merger with Fisher Body. New corporation will be called General Motors. $13
New Stock Prices Midland Utilities- Reports in the Chicago Tribune disclose Insull’s Co. is a “House of Cards” ready to crumble. $14 Kansas Pacific- New oil fields in Oklahoma cause a new boom along Kansas Pacific track. $12 Tel-Tone – Fails to rise as predicted. Brokers are unable to explain the downward trend. $17
Wednesday, October 23, 1929: The market slipped today as the government announced that home construction, an indicator of prosperity, was at an all time low. The Federal Reserve Board also announced that a change in the prime interest rate would take place in the near future; speculation on the stock market is getting out of hand. It is rumored that the House of Morgan intends to sell 12 million shares of common stock at a loss, before interests rates change. The Gotham Bank announced that margin buyers of stock are being notified that they must put up more money to cover today’s losses. Market will close in 5 minutes.
Thursday, October 24, 1929(Black Thursday) 1929 Panic hits Wall Street. 12 million shares are traded in one day on the New York Stock Exchange. 700 million is lost by the stock holders in one day the market takes the greatest dive in history. New Stock Prices Kroger $8 Radio Corporation $4 Mammoth Oil $2 Gotham Bank $12 Durant Motors $12 Midland Utilities $3 Kansas Pacific $8 Tel- Tone $6
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