New-York tribune., 1909-06-17

queny punlshing infractions OF its rules WIN s s.
! proper measures TO prevent wrongdoing. This has
Willingness to interfere in the business Of others
marked sdo among brokers'. and frequently leads them
/ to overlook misconduct the part OF fellow mem
cynical gossip and Comment in the street The pub
! lie a right expect something more than TINS
from the exchange and its members
Little space is given in the report to the Con-
solidated Stock Exchange, which is described
as "a secondary market of no mean proper
tions." The committee remarks:
| The fact that its members make speciality of
broken lots, e.. transactions In shares less than
it is serviceabe institution for investors Of rela-
ceengy mife and that it ords Facilities for
attracts persons OF small means
! Considerable space is devoted to the curb
market. which the report says has been really
/ important since about 1897. This market, the
committee understands is dependent for the
great bulk of its business upon members OF the
Stock Exchange. approximately IS per cent OF
the orders executed coming from Stock Ex-
change houses. Despite the lack of proper su-
pervision and control the admission of
securities to the privilege of quotation on the
curb. the existence of the cited abuses does not
in the committees judgment. demand the aooi-
tion of the curb market. Regulation, however
is deemed imperative and that regulation the
committee believes should come from the Stock
Exchange.
SWINDLING ADS" AND FAKE DIRECTORS
The abuse Of advertising is gone into at some
length the committee declaring that much Of
the discredit in the public mind attaching to
Wall Street is due to frauds perpetrated by
means of alluring advertisements. The report
says:
Papers which honestly try to distinguish between
every instance succeed in doing So but TsaalneSs
TO accept advertisements which are I oDTl9dS1s 6II
quency which should draw out the severest puolc
condemnation. Another serious evil is committed
by men who give standing to promotions by serv-
ing directors without full knowledge Of the
affairs of the companies
An amendment to the Penal Code is recon-
mended providing that any person who adver-
tises falsely concerning a corporation shall be
guilty of a msdemeanor. and that any publisher
Of newspaper other publication who fails
to obtain from the person responsible for such
an advertisement a written and signed state
ment TO the effect that such person accepts re-
sponsbility for the shall be guilty Of
misdemeanor.
In reference to bucket shops II is recon-
mended that a feature of the Massachusetts
law be adopted making It necessary for convic-
tion to show only that the bucket shop keeper
intended the trade to be settled by differences
and not by transfer of property. It is advised
also that a law be passed providing that. go far
as the transmission of continuous quotations is
concerned. telegraph companies shall not be
deemed common carriers. he compelled
against their voIition to transmit such quota
tions to any persons: also law providing that
II telegraph company has reasonable ground
for believing that it is supplying quotations TO
a bucket shop It be criminaliy liable equally
with the keeper OF the bucket shop.
CONCERNING OTHER EXCHANGES
In considering the Produce, Cotton and Coffee
exchanges the report says that the business
transacted on them is mainly speculative and
discusses exhaustiveIy in this relation the sys-
tenn Of dealing in futures hedging and trading
IN alternative contracts The suggestion is
made that margins required from outsiders on
these exchanges. now usually n per cent. bs
increased 70 90 The report recommends the
abolition Of the Produce Exchange mining de-
partment. saying:
From examination Of the trading trading IN ,ns4 @n,Ps Ing
lack Of experience or this body IN .iis -,rer
business has resulted in neglect or proips'
safeguards TO the investor Ts ana Ai gsmbIlnx
nature and should not be tolerated on the produce
Exchange.
The Cotton Exchange is described as the
most important cotton market In the world
and the worlds clearing house for the staple
The only recommendation Teldlils W ''iS -
change is that the management should take
steps to curtail the unduy large speculation OF
a gambling sort. OF the Coffee Exchange 1t is
remarked that 1t has q commendable rule pro-
viding that in case Of a corner" the officials
NAV fix a settlement price for contracts 70 avoid
disa strous failures The Fruit and Hay ex-
changes the report says, appear TO BE- in no
wise concerned with speculation Sharp crit
icistn is made of the Mercantile and Metal ex-
changes, the report saying:
Although quotations of the products appertainins
20 these exchanges are printed daily IN the PUBIC
among members either for immediate or future
delivery.
arc some desultory operations in so-caled future
contracts in butter and eggs. the character OF
which is, however, revealed by the fact that
neither delivery by the seller nor acceptance by
the buyer obligatory; the contract may he voided
OF per cent The quotation committee is actually
a close corporation of the buyers of butter and
as 10 the rates at which the trade generally
should ready to buy from the farmers and coun-
Similar. but equally deceptive, is the method OF
making quotations on the Metal Exchange. In
spite Of the 1f be9. m
no actual sales the floor of the Metal Exchange
several years. Prices are, however manipulated
up and down by quotation committee OF three,
selling agencies their interest may appear af-
ford!ng facilities for fixing prices on large con-
tracts mainly for the profit of small clique. en-
bracng. however. some Of the largest interests I'm
the metal trade.
These practices result IN deceiving buyers and
opinion that the Mercantile and Metal exchanges
do actual harm TO producers and consumers and !
that their charters should be repealed.
The nine members OF the committee all of
whom sign the report are Horace White, author