The Richmond Virginian. (Richmond, Va.) 1910-1920, 1920-05-08
STREET IN GLOOM
OVER PROPOSED
NEW STOCK TAX
BY BROADAN WALL.

New York. May wall street VIZ
flooded with pessimism today to Hu-1
ian extent that old traders bought SON"
stocks in the afternoon, The fcet1n@
was so desperate II could not possibly
BIZ true. The stock exchange authori-
ties of the country were IN angry coH
Terence over plan to save the buSt-
ness of the country from the new stock
tax. The head of the National City
company ventured the opinion that tn
banks could not finance the railroad
needs of the year. Labor men pr" -
scented a memorial showing that the
corporations of the country had pro-
iiteered to the extent Of billions sin.
the war began. There were rumors oF
a real railroad strike TO come by way
OF emphasizing the demand for in
creased wages and the railroad man
ayers let it be known unofficially that
the men could strike and ruin the
country for all they cared. There was
nc hope anywhere.
stocks were heavy ~ the opening
and continued their decline until late
IN the afternoon by which time the
average losses were about two per
lcent. Then a moderate buying roVe-
menf began which caused a rally of
about point. Atlantic. Gulf ami
West Indies, and Virginia coal nd
Vanced about II points from the low
Then somebody discovered that a large
bank had loaned Sc 600 200 or ttne
money for sixty days st Stz per cent
This beng the first large amount IT
time money put out since the first ~
April. IL checred the street up and
the close was IN the midst Of falFsy
good rally.
The short interest in the stock mar
ket is large and viii probably he
forced to cover by the brokers wno,
Ii r Re- .,
in its efforts to educate the public %
the tact that IT Is the friend Of the
investor and therefore should net he
taxed ont Ct existence. will Of Courte
refuse TO accept orders from oper4-
tors who are raidinE the market. fae
police committee of the exchange las
full power TO prevent raids on invest
ments. The exercise Of that power
will naturally be the first step in the
campaign to educate the public
As prices in Wall street at the mo-
ment have no relation whatever to
values the proposed tax on specHla-
ton ia considered the most important
factor in market movemets Tbe tax
is without question most dangerous
and unpatriotic. 1t viii destroy specu-
lation aud If that is done 1t viii then
he perfectly proper to talk panic not
only in Wall street. but in ali lines
e bus ness. The unhappy feature q
this proposed tax is that il is largely
. result Of the fact that the New York
Stock Exchange has neglected rs
duty 10 the public BY permitting
raiders to destroy investment values
on the slightest rretext. the exchange
has permitted the impression to 20
abroad that speculation is the sarle
as gambling rs d matter Of fast,
speculation is a Legitimate and neces-
*ary part OF all business. Reformers
in congress who do not understand
the first principles Of economics mag
Inc that by striking at the speculatyrs
they viii reduce the cost Of lvjg and
increas" TAX receipts The proposed
law would increase the cost Of living
by making j, extremely difficult to
get capital for any enterprise and il
would reduce the number Of dollars r.
eeiyed in taxes because II would de-
stroy the business on which tie pres
emit taxes are levied 1t is sueh a1
absurd tax that there is little CHANGE
Of il being made a law.