Imperial Valley press., 1913-12-16
Brandeis Writes
On Money Trust
tBy United Press Assoc,a,,ons)

(By United Press Associations)
New York, Dec. l6.-"Compel bank
ers, when issuing securities, to make
public the commissions or profits they
are receiving. Let every circular let
ter, prospectus or advertisement of a
bond or stock show clearly what the
banker received for his middleman
services, and what the bonds and !
stocks net the issuing corporations"
This, according to Louis ID. Bran
deis, is the crux of the publicity med
icine" which should be applied to rid
the country of the evils of "money |
trust" Attorney Brandeis in the fifth |
of his series of articles on Breaking |
the Money Trust" which appears in
Harper's Weekly today, discusses
"What Publicity Can Do"
publicity is justly recommended as
remedy for social and industrial
diseases" claims Attorney Brandeis
And publicity has already played an
important part in the struggle against
the money trust. Through the dis
closure of facts by the Pujo money |
trust investigation concerning finan
cial concentration, Attorney Brandeis |
believes, an important step has been |
made toward ultimate attainment of
the new freedom. Publicity attending |
these disclosures, according to Bran |
deis, has meant that "the battlefield |
has been surveyed and cnartcd; the
hostile forces have bean located and
appraised" But there must be 2 |
further call upon publicity for service,
pleads Brandeis. 'rrhat potent FORCE"
he says, "must, in the impending
struggle, be utilized in many ways as
a continuous measure" Pointing out |
that Combination and control of other |
peoples money and business and the
wealth of the investment banker are
the main factors in the development
of the money trust" Brandeis de-
clares that it has been the great |
wealth of the house of Morgan that |
has made possible the powerful alli-
ances with great financial institutions.
The main cause of such large for
tunes, he asserts, is the huge tolls |
charged by those who control the ave-
nues to capital and investors-"a toll
that is literally all that the traffic
will bear.'" Continuing, Brandeis |
says:
"The question is asked, why have |
these excessive charges been submit
ted to?' Doubtless because of banker
control; exercise through interlocking
directorates, or kindred relations, and
indirectly through combinations
among bankers to suppress competi-
ton. The investors servility is due
probably to his ignorance of facts.
Coming to the remedy for these evils,
Brandeis says:
"The bankers compensation should,
of course, vary according to the risk
he assumes. Where there is large |
risk that the bonds or stock will not |
be promptly sold at the issue price
the underwriting commission (that is. |
the insurance premium) should be cor
respondingly large But the banker
ought not to be paid more for getting |
investors to assume larger risk.
Now the law should not undertake,
except incidentally in connection with
railroads and public service corpora
tions, to fix bankers profits. And it |
should not seek to prevent investors !
from making bad bargains. But it S
now recognized in the simplest mer-
chandising that there should be full
disclosures. Require full disclosure
to the investor of the amount of com.
missions and profits paid, and not only |
will investors 'behp put on their guard
but bankers compensation will tend
to adjust itself automatically 10 what |
is fair and reasonable"