Security and Commodity Exchanges

　　Security and commodity exchanges are trading posts where people meet who wish to buy or sell. The exchanged themselves do no trading; they merely provide a place prospective buyers and selling can meet and conduct their business.

　　Wall Street, although the best known, is not only the home of the exchanges in the United States. There are the cotton exchanges in New orleans and Chicago; and grain exchanges in many of the large cities of the Midwest. Some exchanges, like the Chicago Board of Trade, provide market services for several kinds of products. These trading posts where products may be bought or sole are called commodity exchanges.

　　The security exchanges, on the other hand, are meeting places where stocks and bonds are traded. Like the commodity exchanges, they help serve the economic life of the country. But when their operations get out of hand, they may become very dangerous. In 1929, the security exchanges, or stock market, contributed to a crash-a sudden, sharp decline in the value of securities. Many people lost fortunes; many corporations were bankrupted; many workers lost their jobs. The Crash of 1929 has been attributed to many causes, among them wild and unwise speculation by many people and dishonest practices on the part of some businessmen and of some members of the exchanges.

　　Today, however, investing through security exchanges and trading on commodity exchanges has been made safer by regulations set up by the exchanges themselves and by regulations of the United States government in 1992, the government instituted the Commodity Exchange Commission which operates through the Department of Agriculture; and in 1934, the Securities and Exchange Commission, to protect investors and the public against dishonest practice in the exchanges.

　　6. Security and commodity exchanges are meeting places for buyers and sellers of _____.

　　A. stocks B. grain C. securities D. all of these

　　7. Security exchanges handle _____.

　　A. securities B. grain C. bonds D. both A and C

　　8. Among the reasons for the Crash of 1929 were _____.

　　A. unwise speculation by many people

　　B. dishonest practices by some businessmen

　　C. strict regulations of the Commodity Exchange Commission

　　D. both A and B

　　9. Investing in securities has been made safer by the _____.

　　A. Security and Exchange Commission

　　B. Commodity Exchange Commission

　　C. Chicago Board of Trade

　　D. Chicago Mercantile Exchange

　　10. Which of the following is implied but not stated?

　　A. Some exchanges provide market services for several products.

　　B. The role of the government has been an important factor in curing dishonest practices on the exchanges.

　　C. Investing in securities is unwise.

　　D. Buying and selling is dishonest.