New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1910-03-27
EXCHANGES WARNED
MUST REMEDY EVILS.
RePreseHtatire Scott and
Others Discuss Legislation.


dress yesterdar afternoon with these
words Of warning to brokers'
The ethical evils 81 The speculative eN-
change will DO eliminated OF rhe Specu-
Iative eXchang. wiz go"
The occasion was the last of TIE regular
Saturday luncheon discussions % tire Re-
publican Club for the season. but bv no
means the least fri importance Judging
from the prominence 60 the speakers aud
the size and att@utiv ene-s Or the at6icaco.
Many commodity and stock brokers' wcrs
present They were particularly interest
ed in the remarks of Representative scort
because he IS chairman OF the House com
mittee on Agriculture. whica has heen
considering for several weeks various steps
20 remedy the alleged abuses iu she ex-
changes % the country
"A matter OF mere business policy said
Mr.. scott. "A question OF oniv econounfc
eEpediency. IS sometimes settled ono way
usd sometimes another. but an ies1s
which appeals % the moral sense Of uinstv
millions OF people In the end is settled IN
but one way. The settlement nay 81
long time coming. partly because the peo-
pie are Indifferent and partly because they
are patient. but 30 always comes. ana q.
always comes one way. II any inst.-ut.or
has in IL a mixture Of good ard evil. the
evil IS separated from tns good 10 ray
be. but n the separation is imrcssi5Is.
then the good Is stricken down with tss
evil"
The speaker estimated that the value 90
the real estate belonging 70 the FIVE largest
exchanges ia this country was S140No. 600.
that their franchises were worth 500 900.
600. and that there was an annual expeudi-
ture Of $4,000 900 for rent salaries. etc.
BY figuring a fair rate or interest on the ~
vestment. he said. this brough- the annual
cost 20 the public OF the speculative plant
up 20 $50 000 900. an amount thar must Gs
paid before the public or the operators be-
gan 70 lay BY a profit In view Of this on
nuai toll and the constant temptation -
overspeculation. he asked II there were nos
some warrant for inquiry into the possi5ls
disadvantages OF the system.
Manipulation BY Misinforustion.
II have heard he continued. mat IN
stead OF giving their customers all the ia
formation they have about the security O.
commodity in which they trade. there ar
some on your exchanges who give them
actual misinformauon. have heard thar
men sometimes plan long campaigns % d.
ioerate falsehOod. carried our by sklfiI
combination OF newspaper publicity and ex
change manipulation % force the prtce &c
some security up or down 50 that in the end
some buyer will BE- deluded. Why shouldn't
the buyer or securities be a. well protected
as the buyer % groceries,"
The Representative said that raUrosA -
curities ought TO be among the most popu-
lar investments IN the United states. bu.
that millions Of investors fed from them
as from a pestilence He thought that
that little Rock Island upheavaT' u-izsr
have something 20 do with II
He said he supposed the collapse OF the
Hooking pools came because somebody for
got % hold his breath or keep HIS face
straight He went on
1t IS only fair 10 the New York Stock
Exchange 20 say that both OF these trans
actions we're promptly investigated NJ
recollection is that the governing commit
tee deliberated over the Rock Island deal
for several days and then announced that
II was TOO bad As for the Hooking pools.
believe the verdict reached was that an
office boy had inadvertently bought or sold
something that had been left IN his care.
and / have no doubt he was promptly
disciplined
There should be no difficulty in c1rtin-
out OF exchanges every practice that has
/ concentrated upon 70 the condemnation OF
the country. II 7 were addressing the
membership OF the speculative exchanges
should say 20 10. Set your house I'm order
And by way OF emphasizing the necessity
not only OF thoroughness. bur OF speed. IN
that matter I might remind them thar a
question which involves a moral issue an
peal5 with tremendous power 20 the people
Of the United States"
Representative scott said he could not
discuss the bills pending IN hts COMMITTEES.
which were now receiving executive con-
lrrf ora ion intel
But he said that. II enacted. their influence
would not be comparable tn any degree ID
that OF the action which the EXCHANGES
themselves ought % take and which ne
thought they would take With the permits
sion Of T. B. Merrill. vice-presfdeut Of thu
Chicago Board OF Trade, who was another
speaker Re announced that already taa-
exchange. OF which James g. Pa.ten Is a
member, had adopted a rule penaI.zing ~
expulsion any member who eagineered a
corner r. a commodity lie also saif thar
the directors OF that body had aovv under
consideration the adoption OF a rule prohi5-
itins the senIing our Of market letters
Exchanges President Demands Legislation
W. b. Thompson. the next speaker. VINO
Is president OF the New Orleans Cotton ~
change. came out with a fa-fl0tad demand
for remedial legislation.
1t Is not feasible or wise fc~ Coo-re,s"
said he, TO undertake. 70 make books "
rules for the government OF the exchanges.
but IL is feasible and b. is wise AM necss-
sary THAT the Observance % a rsw plain
principles of risht and wrouS shall as c,m-
manded by racorai legislation ana that a
special executive agency snail le charged
with the duty ~ seeing taa, these man
dates are obeved.
II take this stand With some -reusfx-
lion. blJ with no missiv.ns Tle active iu.
reference hy tie government with the
operations of powerful organized interests
which have hitherto enjoyed Immunity srom
compulsiou involves consequences worth
serious consideration. blt the fart e2cGsa-s
nature - the WRONGS and the increasing
rcstiveness and discomfort OF tie millions
who are touched thereby make wiss rcme-
dial action Imperative"
Professor John g. Clark. % Cch.ynbfA.
who was member 81 the Hughes commits
sion which Investigated Wall street. was
not 50 much IN favor Of Interference by
Congress or by the legislatures. re said
such a course would be Ike sending /.
French clock 90 a blacksmith % be ls~
paired
But the mere potentialitv 81 suc,s a
! thing" he added us not unlikely % oru<
about remedial measures by the EXCHANGES
themselves. i am glad thar legislatures
y