New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1885-04-11
THE ELL 10 ST0P SHORT SALES
nrrns1rlnx or b .oK.Rs Avn TRAprns.

OPPOSITION or Il 'OK rs AND TRADERS.
Brokers and traders in Wall Street are strongly
opposed to vcdder bill relating to sales Of stocks oil
aud other commodities. which has passed the Senate.
aud il is believed that II It could be enforced It would
cripple speculation or drive the Exchanges to NowJer-
sey There Is little doubt however that the measure. II
II becaiue law would be tested I'm the courts tho
ground of unconstitutionality George II. Gibson OF
Watson * Gibson xpressed the general view Of brok-
etsuatalk with TRIBUNE reporter yesterday He said
1.-The Velder bill Il. believe. an attempt legally l."
suppress short sales In all the speculative markets OF
this city. II or inAtcl among few Oh producers In
Senator vcdders district who conceived tho idea that
short selling depressed the price Of their product, but
the bill applies also railway stocks, bonds grain. etc
IL that the seller Of certificates 81 stocks or
warehouse receipts. storage certificates. In tho E1
changes Of this city ball furnish the buyer at the time
Of sale with the numbers OF certificates intended to be
delivered aud that the Of his failure furnish
these numbers tho seller shall DO deprived Of
the power to legally enforce the contract The
Is prep0stcruus Speculation has It, evl aud
often degenerates into practical gambling out We must
rcco nzc the speculative spirit tue handspring OF
commercial activity aud growth. because no oppressive
Medieval legislation has ia npered the free exchange OF
commodities. property services. Ncw-Iork has be-
great financial and COMMERCIAL centre ana VAL
street gaining the capital OF foreign states now.
the essential prerequisite 10 market u thht mere sha
be bulls and bears that some shall believe ~ lower
conception that 10 j. wicked to sell short than to
buy to sell what yon already have bought hheh any
dou, OF panic short interest, which then PUSHES
IN cover stays tue progress OF disaster ana -t'aics
in Wall street aud, except IN case. where the
merit OF the investment i eHeeptionM, many
commodities IN which there was not known to exist
Irrnliar 10 Wall street u IL principle Of business
throughout the commercial world The contractor agrees
~, iId hon-e accoriiug to specifications for stipu-
lated price, He clio the contract, an yet no court or
legislature would regard II - ghnhllhg contract anu
refuse to enforce II bccahs he lid not own Ocios'
D. .srfl. Ia a4 IA d
"The manufacturer sells his goods In advance OF tner
actual fabrication and would he absurd 20 pronounce
his Illegal because he could not, ANA did not
r, - nl uroinccr ,yhnse interests mi. bin /. sup
posed to UhOdgh the largest aud most sensible
repudiate ~ may know that his wells VIII produce
He may think that prices likely To decline, an 80
sells hI- reduction ahead OF It's actual output WOMB
not he prepOserOus rob him Of this privilege Ana yet
he would bc short seller and under tie Vrdder bll
80 d, every bnyer You may 20 into the market and
agree To purchase all that Is offered and II the market
cri,Hca,es who's. numbers were not furnished you at
time OF sale and the VIII protect you l. not this
direct prenum by the state on fraud and rscalityf
.Tbc srgumeut was made In favor Of tine Di that
appiicd 10 OIL for Illustration, the producers
would be benefited. II ought II anything more
than dead,letler law to have contrary contrary
knows that market with only one sile 10 II ~ no mar
ket at all an that II speculation should be ed theio
would public 10 buy the producers oil The only de-
, hahp o' i" phrT combined Interest The stock Of
OIL above ground large and after possessing them
OF enough for their refining uses Tor some months
they could say 10 the scattered aud lpless OllpO
dncers. who must lind immediate market for ihrlr
DAILY output We don't want any more oil. II you Wis.,
however will take IL AT price we VIII nN on IT,
Tne producer would have alternative. but II u not
likely that OF kerosene would pay less Tor tue
refined article IL requires hut little thought 10 see that
speculation. instead Of being au inJurr TO pro-
duccrs, IN beucnt, giving them "A constant mar
ket place In which fluctuations givo alternate benefit
producers and consumers. Short selling frequently
induces OVcrsDid condition IN all speculative mar
kcs and the hurried buying TO cover causes rapid up
ward movements
"The grQwth OF oil speculation in NowYork not only
furnishes occupation aud living To brokers hlrray
resident here but its growing proportions have attract
eel producers brokers and traders from the oil frgohs
whose Expenditures help TO swell the wealth OF the t
As stocks, the facilities with which issues OF railway
bonds aud shares coud be marketed here has caused the
extraordinary development Of the railway system o
the country. The stock Exchange would have furnlshed
emplOyme To only small part OF the capital wlleh
has oTawn thither were IL not for the speculative
side OF its business It Is hard to conceive that our
lcg laiOrs can be 80 narrow minded rs to enact any
law that would eml arraSs mans freedom 10 buy anu
sell, that would tend to drive capital from the e ana
state, That would condemn as unlawful an net when
necessary tOa speculative market capital itself
aud that would impair the validity Of contracts entered
into In good faith and Tor commercial purposes Spccu
atiOn cannot be suppressed by law the Congress OF
the United states found out when IL passed the bolu
bill prohibiting speculation In gold The result was ~
disastrous and opposite To what they expected that
was almost Immediately rescinded. The 'Ncdder bill
II IL should become law, viii not he regarded ms pima
ing; business will De done honor IL largely Is al
present but 1t would tend to bring law into public con-
tempt