Daily Kennebec journal. [microfilm reel] (Augusta, Me.) 1870-1975, 1913-01-30
Good for Governor Sulzer.


And Governor Suffers Recommended
tions for reform of the stock ex-
change, whether carried out by the
New York legislature now or not IS
only the beginning The unholy
swindling carried on under the name
of stock exchange" is disgrace to
civilization. 1t is a job for New
York state to clean up the abuses eX-
isting as legitimate business. But SO
fragrant have abuses been that the
federal government ought to have
forced a purging long ago.
Governor Sulzer speaks of the
"shifty schemes and clever eombina-
tions to catch the unUary and to mis-
lead the public" To effect this, he
recommends the enactment of group
of laws. at least one of which shall
provide Imprisonment as a penalty for
its violation. These laws, the Gov
ernor says, should apply to certain
practises which have been shown to
exist by the Pujo committee of the
House of Representatives and other
Investigators
THE testimony of some of the gov
-eFnors of the exchanges Governor
Sdlzer says. leaves no doubt in the
minds Of men of judgment that the
Exchanges have been either incapable
or unwilling to devise measures that
will effectively eradicate the evils. 1t
is now the obvious duty of the state,
it seems to me, to devise the rem
edies, If the state neglects to do its
plain duty, the state should find no
fault if the Federal government acts
in the premises
Among the measures which Cover
nor Sulzer would have enacted into
law are:
law to distinguish clearly proper
transactions of purchase and sale
from those that are the result of COM
DiilotlplS " iclot vi oSpiOoS eii LII
cially the price of securities without
regard to their true value or legiti-
mate supply and demand.
A law to prohibit brokers from SELL
ing backward and forward among
themselves blocks of particular
stock, with intent to deceive or mis-
lead outsiders.
A law to prohibit brokers from sell
ing for their own account the same
stocks they have been ordered to buy
for their customers at the time the
customers orders are executed.
A law clearly prohibiting insolvent
brokers' from continuing to buy and
sell after they become insolvent
A law making it a criminal offense
to issue any statement or publish
any advertisement as to the value Of
any stock or other security, or as to
the financial condition of any cor
poration or company issuing or about
to issue stock or securities, where
any promise or prediction contained in
such statement or advertisement is
known to be false or to be not fairly
justified by existing conditions"
Governor Sulzer also recommends,
but leaves To the Legislature for de-
cision, changes in existing laws and
the enactment of new laws governing
short sales. the hypothecation of Sc
curities, bucket shops, usury (under
which head he classes the raising of
call money rates TO more than six per
cent, the relations between exchanges
and the consolidation of exchanges.
In his message he says, in part:
THAT evils requiring immediate
remedy exist is beyond dispute. These
evils are easily discovered and read
! lily stated. but hte remedies to be APP
piled require deliberate consideration
and the most delicate adjustment to
| meet the situation, so as to benefit the
public at large, and at the same time
not disturb economic and industrial
conditions"
II has been matter of common
knowledge for years that such condi-
tions existed that members of the
exchanges were aware of and ignored
them, and that violations of just
principles of trading have been grinned
at The defenders of the market
are as mealy- mouthed today as at any
time in the last 100 years, and, in fact.
chief defense lies in reference To
the great number of years which It
has been tolerated TO perfect its meth
DDS and fix. hereditarily, its approval
OF its own misdoings
Let Governor Sulzer go ahead and