Atlanta Georgian. [volume] (Atlanta, Ga.) 1912-1939, 1913-04-10
NEW RULE BARS
FAKE SALES; To
SAVE MILLIONS
Checks, Except on Curb, Stock
JuggIers' Fayorite Scheme to
Fleece Investors.
BY 3. c. FORBES.


that appears along with elaborate
charts. in Hearst's Magazine Cor
April Some Of my statements re-
gardiug the extraordinary rigging %
speculative dealings in Standard oil.
shares may appear strong but they
faI 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 eoun e
try's great business organizations.
The New York Stock Exchange S
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 that
the dealings represent bona fide pur-
chsses 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. It 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 ia
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 unscrupulous
schemes for sending up and sending
down prices Of securities to uniustified
levels 10 enable the riggers to scoop
in millions Of dollars.
In the good old days" which we're
really very bad old days, it was con-
sidered part Of the game OF speould-
ton to tool the public at every turn,
grossly to deceive them as to values Of
stocks. 10 enties them into the market,
and then to fleece" them, to use the
common and expressive phrase.
u more money could be made BY
throwing road into bankruptcy than
by running IL prohtably. the road
went into bankruptcy with seant esre-
mony
Dividend checks used to be the least
important source Of income for the
arch .manipulators Of stocks. A TO-
point profit in a speculative move.
rent was worth two dividends OF s
per cent eaeh-and the 10 points
could be made perhaps N a week,
whereas It took two companies a
whole year TO make the dividends.
This evil Of abusing the machinery
Of the Stock Exchange, this high
waymen's game OF ssndbsgging the
public through unserupulous manipu-
lstlons, has not been played by the
nations greatest stalwarts quite so
frequently or so flagrantly 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 mui-
tiplied milli0nS, fll their pals 20
the brim every year. Just as sure
as New Year follows December g.,
so surely can Readings nilkmen
count upon replenishing their dairies
Reading can be made 70 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 faithful animal.
The profits made by the Rockefei-
Ter interests and their associates in
stocks covering the various branches
Of the oil industry have been scan
dalous-scandalou because the IN
slders have had complete monopoly
Of information concerning the profits
Of tine companies and could therefore
play with loaded dice. The principle
Of publicity has been disgracefully
flouted.
Repeated efforts by stockholders to
obtain facts and figures Of their cor
psnies we're futile. the Rockefelle-
people naiveiy and evasively reply
inc that no information was available
for the helpless public. Plenty 81
Il. however. was open TO the inner
circles. TO the 20 Broadway crowd.
and there IS no reason 20 believe they
have not acted upon II with results
that have swollen bank accounts 60
overflovslng.
Practically all the thirtv- tour var
cites Of Standard Oil issues have
played tricks on investors since the
farcicisi "dtssol ution" Of the parent
company.
Standard Oh Of Kentucky shot nc
about $500 a share ~ one oav. Ther
u fell back as much IN February
last u tun1bjed $50 a share with en-
bsrrassing suddenness On both &C
cssions there were reports-"fron1 i'.-
side sources Of course-of prospect
i've financing that did not material
ize.