New-York tribune., 1918-12-10
Favor Return to Private
Ownership With Super
vision by the Government
Propose Blue Sky Laws
Advocate Repeal of Anti.
Trust Laws as Applied to
transportation Facilities
stag Correspondence

Stag Correspondence
ATLANTIC CITY, Dec. 9.--The re-
turn of the railroads to their private
owners, but with certain amount of
Federal supervision, and the enlistment
Of Congressional aid in fighting the
fraudulent securities evil were urged
here to-day at the opening of the sew
enth ANIMAL convention of the Invest
ment Bankers Associations
These questions, together with dis
cussion of the tremendous change
which the war has wrought in the Sc
curities market, occupied the attention
of the 800 bankers from all parts Of the
country who are attending the gather
ing.
John E. Oldham, of Boston, chair
man of the railroad securities COM
mittee, reported on problems that
faced the railroads. The recommends
tions which his body advanced were, in
brief:
Condemnation of the pre-war plan
of railroad regulations; elimination of
conflict between Federal and state bod
les in whatever new plan of control
is to be devised; repeal of the Sher-
man and state antitrust laws in their
application to transportation, for the
sake of efficiency and economy; as
sumption by the government of re-
sponsibility for adequate earnings and
sustained credit if the government plan
Of control increases operating ex-
penses and regulates income.
Tried Method a Failure
Careful consideration of the cir
cumstances," Mr. Oldham reported
leads to the conclusion that the sue
cess or failure of private management
under system of reasonable and fair
regulation has never been fairly tested
but that the tried method of regulating
private management is a demonstrated
failure.
THE committee recommends that the
association put itself squarely on rec
ord at this time as opposed to public
ownership of railroads or permanent
public operation, and emphatically in
favor of an early return to private
ownership under such altered methods
of regulation as will insure sound rail
road credit and an adequate system OF
transportation"
William A. Maxwell of New York City,
chairman of the committee on fraudu-
lent advertising, spoke of the increas-
ing danger of fraudulent securities
which persons were purchasing, often
giving in exchange their Liberty bonds,
and TO check this evil proposed the
following resolution, which was
adopted
Favors Blue Sky Law
Whereas, Through sales for cash and
more especially through the exchange
of fraudulent securities for United
States government bonds by unscrupu-
lous persons, who are thereby swim
ding many Of our citizens, condition
Sc serious has arisen that it has be-
come a menace to the country; now
"Be it resolved that the board of
governors shall take such steps to
abate the fraudulent security evil as
shall in its judgment be necessary
whether such action shall be in the
nature of request to Congress for
the enactment of national blue sky
Of request to the various states to
enact uniform blue sky law in all
the states or whether it shall be
through independent action by the
association itself"
In his opening address, Warren S
Hayden, president OF the association
discussed the change that had come
over the security market through the
tremendous increase in the number OF
bondholders, which has been one of the
results of the war.
I'VE cannot do as we did in the old
days." he said, "and we shall examine
our methods again and again. Even
our wares will not be the same. We
shall have municipals, rails, utilities
and induStrials, but after the violent
dlslocation of the war, all of the cor
poratlons making these issues will
hardly revert to precisely the old posi-
tlons and forms.
New Securities Novel
Then, too, we shall become familiar
with securities which from the pre-
war standpoint are novel. Government
nonds were not of general interest in
the market, but they are now and long
must be. We shall know more about
foreign securities issues, both public
and private. Much is being said about
Americas foreign trade in times to
come. That it will be great is beyond
doubt But it will not come to US as a
matter of course. Other nations are
no less interested than we, and their
we'll contrved arrangements may we'll
engage our attention. But we have our
lair opportunity, and it will not be
neglected.
1--WE, of course, know that a large
overseas trade implies large overseas
lnvestmc"ts. We of this association
VIII be peculiarly interested in that
aspect Of the matter, but let us can
dldly admit that the majority of us
have only the most general ideas about
foreign issues and we are now in nc
position to judge their merits. Thi:
Is but one of the incentives to drive
US to a wider outlook.
"Provincialism in the bad sense is
steadily diminishing. We have this
modern spirit and go with it. We wei
come our opportunities and wish to bt
worthy of greater. Investment banking
Is not, and still less is to be, busines;
1or petty men. The investment banker
VINO seeks to fence in his little are;
and, yet worse, to fence in his little
mind, will be slightly respected an dno
needed at ALL"