Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1913-04-09
new RULE BARS
FAKE SALES; To
SAVE MILLIONS
Checks, Except on Curb, Stock
JuggIers' Favorite Scheme to
Fleece Investors.
BY q. c. FORBES.

BY 3, Z. 2 OHbES.
Here are extracts from an article
that appears. along with elaborate
charts in Hearsts Magazine for
April. Some Of my statements re-
garding the extraordinary rigging Of
speculative dealings in Standard oil
shares may appear strong. but they
fall short of what the facts wa
rant
In the future you are to have a
fairer deal when you invest your
money in stocks or bonds Of the coun
try's great business organizations.
The New York Stock Exchanges
new rule forbids fake" sales-that
is. transactions in which the same
party or pool both buys and sells a
stock at rising or falling prices 10
deceive the public into believing thot
the dealings represent bona fide pur
chases and sales. These wash sales"
involve no change in the ownership
Of the shares handled backward and
forward. In the future, no broker can
touch such business on pain Of sus-
pension.
But such rule can not, of course,
reach trading in securities not listed
on the Stock Exchange. 1t does not
apply, for example, to the wild trad
ing going on in the Standard Oh
stocks, since these are not listed on
the Stock Exchange but are dealt la
either on the Curb market or over
the counter.
Many OF Americas great fortunes
have been made in large part from
manipulating the stock market-that
is, from clever and often Inscriptions
schemes for sending up and sending
down prices of securities to unjustified
levels to enable the riggers to scoop
in millions Of dollars.
In the good old days" which were
really very bad old days, il was con-
sidsrsd part of the game of specula
ton to fool the public at every turn,
grossly to deceive them as to values of
stocks, to entioe them into the market,
and then TO fleece them, to use the
common and expressive phrase.
II more money could be made by
throwing a road into bankruptcy than
by running it profitably, the road
went into bankruptcy with seant cers-
mony.
Dividend checks used to be the least
important source Of income for the
arch manipulators of stocks. A 10
point profit in a speculative move
nent was worth two dividends Of
per cent eaeh-and the 10 points
could be made perhaps in week.
whereas IL took two companies
whole year to make the dividends.
This evil Of abusing the machinery
Of the Stock Exchange. this high
~aymen's game of sandbagging the
public through inscriptions manipu-
Iations. has not been played by the
nations greatest stalwarts quite so
frequently or so Hasranty within re-
cent years, although the record even
for the last year or two does not in
spire pride.
The most manipulated stock on the
New York Exchange, year in, year out,
is Reading. Its mixers, men Of mul-
tiplied millions, fill their pals to
the brim every year. Just as sure
as New Year follows December 81,
so surely can Readings milkmen
count upon rsplenishing their diaries.
Reading can be made to yield "a
broader and more dependable stream
OF gold than any other stock on the
list. Other issues may rival or even
excel Il at times, but Reading goes on
forever. II is a faithful animal.
The profits made by the Roekefel-
Ter interests and their associates in
stocks covering the various branches
of the oil industry have been scan
dalous-scandalous because the IN
siders have had complete monopoly
Of information concerning the profits
OF the companies and could therefore
play with loaded dice. The principle
Of publicity has been disgraeefulIy
fiouted.
Repeated efforts by stockholders to
obtain facts and figures of their com
panies were futile, the Rockefeller
people naiVely and evasiveIy reply.
ing that no information was available
for the helpless public. Plenty Of
Il, however, was open 70 the inner
circles, to the 20 Broadway crowd,
and there IS no reason to believe they
have not acted upon It with results
that have swollen bank accounts TO
overlooking.
Practically all the thirty four vari-
cites OF Standard Oil issues have
played tricks on investors since che
fareicial dissolution Of the parent
company
Standard OIL Of Kentucky shot ur
about $500 a share in one day. Then
u fell back as much. In February
last il tumblsd $50 a share with en-
barrassing suddenness. On both oc-
casions there we're reports-"froua in
side sources Of course-of prospect
i've financing that did not material
ize.