The Stock Market: A Billion for Peace of Mind

Stock-market investors have always known that they can be wiped out if they choose the wrong issues, but it has only recently dawned on them that they also can be ruined if they choose the wrong brokerage house. That threat has been raised by several brokerage failures. So far, the failures have not caused any grave losses to customers, but there is a danger that a series of future ones could do so—and that even clients of solvent brokers would be panicked into selling out everything, bringing on a stock-market collapse.

Wall Street and Washington agree that in order to...