The sun. [volume] (New York [N.Y.]) 1833-1916, 1903-08-02
Cummins and Caveat Emptor

Cummins and Caveat EmptOr.
The Hon. ALBERT B. CUAiM1Ns, Gov
ernor of Iowa and head of the Iowa Ideal
school, views overcapitalization with
alarm In speech made at Davenport
to the bankers associations of Iowa
and Illinois he proposed that the Govern
ment protect the buyer Of stocks;
The Government should protect society in the
things in which II cannot protect itself. We have a
right 10 demand that II protect us In the matter of
wrongly inflated stock values. do not mean that
tho Government should see that tho stock values
OF these overcapitallzcd companies remain steady.
but | do think that the Government should TO It
that these stocks are founded upon values reason
ably fair and enduring. There Is no man, no matter
how conservative. whose business is not affected
by the rise and fall Of the existing inflated secur
ties In legislsting to protect the country In this
direction there might be some conflict between
the powers exercised by the national and the State
governments. but this difficulty could be over
come. The easiest form Of legislation would be
the restriction OF the issue OF stock certificates
to the values represented by them. They should
at least have a value that would endure through
competition"
Evidently Mr. CUMMINs believes that
the Federal Government can be endued
with some sort OF magical wisdom to
appraise values and magical power to
make them enduring. Take the manu-
facture of bicycles A bicycle trust was
formed. The prospects were gorgeous,
but the demand for bicycles decreased.
How would the Government have pro-
tected the stockholders? How can the
Government give any shares I" a value
that will endure through competition, y
unless it guarantees them itself? Man.
ufacturers and business men in general
ought to write Governor CUMMINS.
What is the secret of giving to stocks. or
to the properties against which they
are issued, a value that will endure
through competition? As to wrongly
inflated stock values" has it ever oc-
Cured to Mr.. CUMMINs that prosperity
is the great inflater? A Government
that could prevent prosperity, Populist
Government, let us say, might really
protect us in the matter of wrongly in
fated stock values.
But why are stock values to be searched
and guaranteed to be enduring by the
Government any more than live stock
values, for instance? Why ought the
people who buy stocks to be the wards Of
the Government while the much greater
number of people whose stock pur-
chases are horses or hogs or guinea hens
are not protected If mans judg-
ment is bad in buying real estate, and
the boom leaves him high and dry,
he must suffer- but the Government
must help him in his judgment of stocks.
Why are stocks to be so favored? Be-
cause they are easier to gamble in?
Listed by the Government would be a
useful advertisement, no doubt
II is too early for Governor CUMMINs
to worry over little thing like some
conflict between the powers exercised by
the national and State governments.
If the Government is to protect buyers of
stocks, it will have to protect buyers of
anything and everything else. Between
State governments and enduring values,
State governments would have to 20.
This grand secret of finding and fix
ing enduring value is a business prop
osition. If Mr. CUMMINs has a means
of finding and fixing values that will
endure through competition perma-
nent, quintessential values, values Of
values. 80 to k, Mr.. CUMMINs owes
it to an eager public and his own repu-
tation as an economist to publish the
recipe.