You Don't Really Own the Shares You Think You Own
All the stocks and bonds you think you own are actually owned by a company you've probably never heard of, a company owned by the same people who own the US Federal Reserve.
Originally paper stocks certificates were issued as evidence of ownership by companies to investors purchasing shares. But as trading volume exploded in the late 60's this manual system didn't scale. As an increasing number of trades failed due to paper processing backlogs The New York Stock Exchange took the unprecedented steps of closing on Wednesdays in 1968. [.pdf]
In response to the crisis The Central Certificate Service (CCS) was created to electronically settle trades and eliminate the need for share certificates. Although intended as a temporary measure, it is still with us.
Financial assets purchased today aren't registered in your name; rather they are held in what's known as street name. Regardless of the assets purchased or the broker used, this name is almost always a successor of CCS, namely The Depository Trust & Clearing Corporation (DTC), or some anomalous sounding variant of "Cede & Co".
Holding assets in excess of $40T (yes, trillion), DTC is the single largest private trust in the world - in fact the largest company you've probably never heard of.
While DTC no doubt provides a critical service - standing behind and insuring the performance of hundreds of thousands of broker / dealers, institutional investors, banks, mutual funds, insurance companies and hedge funds, many people are critical of this quasi-monopoly. While some say a system like DTC facilitates short selling, and and other forms of market manipulation, others claim the interests of American shareholders have been superceded by this system of indirect stock ownership, and the technology now exists to revert to direct ownership of stocks [.pdf].
But, as the business of big business is indeed, big business, whether or not these temporary measures will ever be removed is anyones guess.
www.metafilter.com/75928/You-dont-really-own-the-shares-you-think-you-own