Just imagine: Intel Corporation for $69 a share -- a stock that has traded recently near $100 and closed Tuesday 23% higher than that at $85. Dell Computers on sale at $73, even though it changed hands for over $100 just days ago, and closed at $91 Tuesday.

In short, the bargains were mouth watering. Too bad most small investors couldn't get at them.

The reason: Just when you needed your brokerage most on Tuesday morning, it was probably unavailable -- phone lines frozen by a frenzy of calls from excited bargain hunters just like you.

Investors were furious, and rightly so.

"I wasn't able to buy anything as prices firmed up," wrote "Tony C." Tuesday morning in a Silicon Investor chat group called E*Trade Sucks!. "It is pathetic."

"I was ready to participate in a turnaround, but Datek has completely locked me out," complained another investor. "It isn't just e.Schwab that is down," wrote yet another. "Everything is down including their phone lines."

Spot checks of 26 online brokerages by Money magazine between 10:30 am and 12:30 pm showed the problem was widespread. But oddly, while many of the big-name brokerages were impossible or hard to access, several of the smaller, lesser-known outfits almost instantly produced cheery voices ready to take orders.

Brokerages e.Schwab , E*Trade , Dean Witter Discover and Waterhouse , for example, were virtually inaccessible for large stretches of the morning. It was difficult to log on to their web sites, and many investors got busy signals on the phone. At firms like Wall Street Electronica , Wall Street Access , SmartTrade , J.B. Oxford and Net Investor , meanwhile, reps were ready to take an order in under two minutes. Results ran the gamut at brokerages in between.

What went wrong?

In short, brokerages understandably had not anticipated the avalanche of volume that produced a record 1.2 billion shares worth of trading on the New York Stock Exchange, and 1.36 billion shares worth -- also a new high -- on NASDAQ.

"Yesterday and today were extraordinary," says Glen Mathison, a spokesman for Charles Schwab, the only one of the three brokerages we contacted that returned our calls. "I don't believe anybody in the industry had planned or tested capacity at these volum es. We are sorry that not every customer could get through. We will be looking into what we can do to prevent that in the future." Dean Witter Discover and E*Trade did not respond to requests for comment on this story.

Mathison says Charles Schwab had three times the normal level of phone traffic at regional call centers. At times, it had ten thousand Web investors signed on to its site at the same time, compared to a normal average of around 175.

"It really is too bad," said Frank Zarb, the chairman of the National Association of Securities Dealers (NASD) in an interview on CNBC. "Because of all the players in this entire enterprise, the one you want to get through is the small investor. It is just too bad."

Too bad?! Wait a minute. What about the missed profits? Intel at $69! Isn't there anything investors can do?

Write a letter

The short answer: You can complain, but don't expect to recover any money in a legal proceeding.

"It was an off-the-charts kind of day, an aberration," explains J. Boyd Page, an attorney with the Atlanta-based Page & Bacek, which often represents investors against brokers. "The brokers will argue `You can't really expect us to bear the expense to plan for an-off the-charts type of day. We could not justify that to our shareholders." And they probably would win.

"The brokerage has an obligation to have reasonable facilities," agrees Stephen Friedman, a securities lawyer with Debevoise & Plimpton in New York. "And there are times when those facilities don't give you what you want. But I don't think it is negligence or breach of fiduciary duty. It is a question of what is reasonably foreseeable and what level of facilities you have to maintain. If they have acted recklessly, then there may be the beginnings of something. But that is going to be hard to show"

Nevertheless, investors who are peeved about missed profits may find that the most productive thing to do is complain. "This could be a basis on which broker dealers could be disciplined either by stock exchanges or by the NASD," explains John Coffee, an expert in securities law who teaches at Columbia University law school. As "self regulatory organizations," the NASD and the stock exchanges have the duty of regulating many activities of the market. NASD, for example, handles complaints about brokers.

The SEC, which oversees the NASD and the exchanges, also responds to complaints about brokers. "We suggest people put their complaint in writing, address it to the compliance officer at the firm and send copies to the SEC, NASD, and possibly the state regulator," says an SEC spokesman (for addresses, see below).

Angry investors who still want to go the legal route should keep the following points in mind:

* Under the so-called "shingle theory" in law, anyone who hangs a shingle out advertising services implies that they maintain industry standards. Along those lines, the NASD, which regulates brokers, requires that they follow "just and equitable principles of trade." In essence, brokers are not allowed to deviate from industry standards. "But you will only win if there was a clear departure from established norms," says Coffee. Investors can call the NASD at 212-858-4400 for the information and forms needed to file to begin an arbitration proceeding.

* You have no recourse under federal antifraud provisions set up by national securities laws. "The problem is that there is no way to prove the amount of the losses," explains Coffee. "Rule 10b-5 (the antifraud provision of federal securities law) does not permit antifraud suites on the basis of claims that an investor would have done this or that. This is the kind of context where people have a tendency to fabricate the extent of the trade they wanted to make. So there must have been an actual trade."

Here are some contacts if you want to file complaints:

Office of Investor Education and Assistance
Securities and Exchange Commission
Washington, DC 20549

You should also contact your local NASD office. To locate it, call 800-289 9999, or visit the NASD website (www.nasdr.com).

Reporter Associates Kamau High and Tripp Reynolds