Wall Street: A Man for Everyman's Capitalism

When he became president of the New York Stock Exchange in 1951, George Keith Funston said, "I'll try to be a salesman of shares in America."

Up to that time, his primary sales experience had been as a marketing man for the American Radiator & Standard Sanitary Corp. and as a fund raiser for Connecticut's Trinity College, of which he had been president. But he did splendidly as the No. 1 drummer of U.S. everyman's capitalism. Funston's zeal helped raise the number of American shareowners from 6.5 million to 21.5 million. Last week, declaring that "I think I deserve a rest," Keith Funston, 55, announced that he would step down when his term expires next September—or earlier if the exchange finds a successor before then.

Though long expected, word of his retirement caught Wall Streeters unprepared. Throughout almost all the long postwar bull market, Funston has been the symbol and champion of the New York Stock Exchange's Corinthian-columned citadel, a man who helped change its image from that of a clubby, tricky place to that of a respectable and generally profitable market for everyman. After his announcement last week, a score of names were bruited about as possible successors; they ranged from Richard M. Nixon to Walter N.

Frank, the exchange's chairman who will head a nominating committee to pick a new president.

The Second Worst Job. The field is wide open. One reason is that anyone who really qualifies for the job can probably earn more in corporate life than the flat $125,000 that the Big Board presidency pays. Franklin Roosevelt once described the post as "the worst job in the world next to mine." In financial circles, it is commonly said that "Funston has 1,366 bosses," a reference to the exchange's 1,366 often warring members. The exchange's constitution allots so much power to its board of governors that the president is often regarded as merely a figurehead.

But Funston has been much more than that. Besides plugging stock ownership and introducing the monthly investment plan for small shareholders, he raised the number of listed companies from 1,100 to 1,300. This increase, plus the great expansion in trading and a number of operational efficiencies introduced by Funston, put the exchange's activities into the profit column after years of losses. He invested heavily in automation to increase the speed and accuracy of transactions, helped persuade listed companies to release more informative reports to shareholders, and forced companies to make every common stock a voting stock. When Ira Haupt & Co. went bankrupt in a 1963 salad-oil scandal, Funston prevented a crisis of confidence by inducing other member firms to supply $9.5 million to pay off Haupt's customers.

Like the market itself, Funston has had his downs as well as ups. Insiders complain that he failed to strengthen his spotty staff and that he had a chip on his shoulder in dealing with the Securities and Exchange Commission. Relations were much smoother between the SEC and American Stock Exchange President Edwin D. Etherington who, before he accepted the presidency of Wesleyan University this summer, was the favored choice to follow Funston.