The Salt Lake herald. [volume] (Salt Lake City [Utah]) 1870-1909, 1909-06-17

OF the Iact that il is not incorporated
II, however, wrongdoing recurs, and j
| should appear to the public at larg
that the exchange has been dereliet il
eXerting its powers and authority Z
/ prevent it, we believe that the publ
/ VIII insist upon the Incorporation of tn
exchange and its subsection to stat
/ authority and supervision"
Investigation shows that on one &C
/ tive day 81 per cent of the total trans
/ actions apparently originated in New
york city, and 4S per cent in other 10
calities.
The Consolidated Stock Exchange.
The committee describes the eonsoli-
dated exchange as d secondary market
OF no mean proportions" its sales aver
aging about $4,000, 900 shares per an
num- OF this exchange the committe-
says:
The fact that its members make a
speciality of broken lots, namely
transactions in shares less than the 10J
unit, is used as a ground for the claim
that it is d serviceable institution fOl
investors of relatively small means. But
it is obvious that its utility as a pro-
wider of capital for enterprises is eX-
ceedingly limited and that it affords
facilities for the most injurious form
Of speculation-that which attracts
persons of small means"
cosnate Subjects.
Under the heading "Cognate Sub
jects," the committee discusses holding
companies. reCeiveTships, the money
market and the usury law. 1t suggests
that stockholders of a subsidiary COM
pany should have the right to examine
the books of the holding company; that
the courts might place a short-tims
limitation on receiverships; that the
questions concerning the money mar
ket, which are under investigation by
the federal authorities, could not be
adjusted either through exchange regu-
lations or state legislation. and that
the New York law which permits call
loans Of s., 600 OF more, secured by col
lateral, to be made at rates higher
than per cent should be permitted to
stand, as its repeal would not be bene-
fetal.
The Curb Market.
The unorganized status of the curb
market, especially with reference to
mining shares. is discussed by the COM
mittee. as follows:
Bitter complaints have reached rs
Of frauds perpetrated upon confidins
persons. who have been induced to pur-
chase mining shares because they are
quoted on the curb; these are frequent
ly advertised in newspapers and CirCu-
lars sent through the mails as so quot
ed.
Notwithstanding the lack of proper
supervision and control over the adj
mission of securities to the privilege o.
quotation, some of them are merito-
rious. and in this particular the curb
performs a useful function. The exist
enCe of the cited abuses does not, in our
judgment, demand the abolition of the
curb market. Regulation is, however,
imperative. About So per cent of the
business Of the curb comes through the
offices of members of the New York
stock exchange. but a provision of the
constitution of that exchange prohibits
its members from becoming members
of, or dealing on. any other organized
stock exchange in New York. Accord
ingly, operators on the curb market
have not attempted to form an Organi-
cation. The attitude of the stock ex-
change is therefore largely responsible
for the existence of such abuses as re-
suit from the want OF organization Of
the curb market.
Rules Should Be Formulated.
The stock exchange should compel
the formulation and enforcement of
such rules as may seem proper for the
regulation of business on the curb, the
conduct of those dealing thereon. and,
for the admission of Sc
curities to quotation
The abuse of advertising is gone into
at some length. the committee declaT-
ing that much Of the discTedit i'm the
public mind attaching to Wall street is
due to frauds perDetrated by means of
advertisements.
Papers which honestly try to distin-
guish between sWiudling advertise
ments and others, may not in every in
stance succeed in doing So" the report
says, but readiness to accept adver-
tisements which are obviously traps for
the unwaTy is evidence of a moral de-
inquency which should draw out the
5everest public condemnation.
Another serious evil is committed
by men who give standing to promo
lions by serving as directors without
full knowledge of the affairs of the COM
panies.' An amendment to the penal
code is recommended providing that
any person who advertises falsely con-
-erning a corporation shall be guilty of
q misdemeanOT. and that any publisher
IF a newspaper or other publication
who fails to obtain from the person re-
sponsible for such an advertisement a
written and signed statement to the
effect that such person accepts respOn-
iibilty for the same, shall be guilty of
misdemeanOr.
Bucket Shops.
With reference to bucket shops, it is
that a feature of the
law be adopted making
[ necessary for conviction to show only
hat the bucket shop keeper intended
he trade TO be settled by differences
md not by transfer of property. 1t is
advised also that a law be passed pro-
Item Welcomed