New-York tribune., 1918-11-05
Stock Exchange
Takes Action On
Money Situation
Brokers' Committee Chosen
to Confer With Bankers
on Loans


Exchange at special meeting yester-
day afternoon appointed q committee
of five "to consider the present money
situation with relation to borrowings
by members and their firms and to
confer with the loan committee Of
the banks in regard to same" The
action was taken in response to wide
spread criticism by brokers and stock
traders of the methods by which the
money committee in cooperation with
the stock exchange authorities pro-
ceeded to curtail loans and prevent
undue" speculative movements.
II. G. S. Noble, president Of the
exchange, will head the committee,
and his associates will be Winthrop
Burr, H. X. Pomroy, Donald G. Geddes
and William H. Remick. The last two
are members Of the Association of
Partners of Stock Exchange Firms and
the others are members of the ex-
change. The money committee, will
not meet until Benjamin Strong, the
chairman, returns from his vacation.
He is expected Thursday.
Inasmuch as the entire handling of
the money situation as it affects the
market has been placed in the hands of
the new committee, governors of the ex-
change declined to comment on pro-
spective developments. The fact that
by resolution the governors instructed
L. h4L rs tto
committee was interpreted to mean
that the stock exchange representa-
tives purpose to ask the bankers to
make revisions in the present restric-
tions ON stock exchange loans.
Arbitrary Date Attacked
A target Of special criticism has
been the ordering of stock exchange
firms to reduce their loan account to
the level of September 16, week
after the time when they were first
called upon to submit daily reports on
their loans. The date was presumably
selected as the time when the first
expansion took place, after the money
committee had put itself on record
as opposed to an enlargement OF the
volume of loans for stock exchange
purposes because of the national need
of conserving credit for essential pur-
poses.
The fixing Of this so-called arbitrary
date has been attacked chiefly on two
grounds. First, the letter written q
week ago Thursday by Mr.. Strong, in
behalf of the money committee. to Mr..
Noble, pointing out that beginning
yesterday the margin on stock ex-
change loans would be raised from the
customary 20 per cent to 80 per cent,
explained that no further expansion"
Of loans would be allowed. Brokers
wonderedwhether in instructing them
to reduce their loans to the level OF
September 16 the stock exchange au-
thorities were going further than the
instructions of the money committee,
and, although spokesman Of the money
committee indicated that it had not
added any requests to those OF the let
ter, q governor of the stock exchange
said that he and his colleagues were
they had not been ordered to do.
Then, in the SECOND place, Stock Ex-
change houses thought that to regard
the level of loans on any single day
such as September 16--as G. standard
was unfair and arbitrary, asserting that
in many cases September 16 was not
typical day. 1t has been urged that the
Stock Exchange authorities determine
the proper level Of loans by the aver
age accounts of several davs. In mar
ket circles it is believed that a desire
for a readjustment in this particular
is one Of the chief reasons for the ap-
pointment of the committee.
To Remove Inequalities
No apparent confusion resulted yes
terday, when the time limit for increas-
ing the margin from 20 to 80 per cent
was reached. Many Stock Exchange
firms, it was explained, made the read
justment gradually last week, and in
some cases the margin carried when
the increase ordered was larger than
the then minimum.
The new committee has been charged
with the task of eliminating, so far as
possible, the inequalities of the re-
cent money rulings, and. in addition,
with reconsidering the whole problem
of money restrictions in the light of
the critical suggestions which have
been forthcoming.