The Washington times., 1922-03-05
|E'INAN CE|
AND
BUSINESS
By b. G. FORBES.

Being . big man" isn't all fun.
II has penalties that ordinary NOR
tails do not suffer.
For example. a man arrested on
charges Of having swindled rich
women out OF hundreds Of thousands
OF dollars had fooled them, they
claim. by making them believe that
he was extremely intimate with GER
tain very prominent Wall Street fl
nanciers and that they and he be-
longed to a club where gambling was
carried on for very high stakes.
And Immediately these bankers
were summoned to court to testify.
You can imagine how annoying
such unmerited notoriety and such
inconvenience were TO men like
George r. Baker, Thomas w.
Lamont, Charles II. Sabin. Percy A.
Rockefeller, and w. Averil Harri'
man.
This claiming intimate friendship
with financial leaders Is an old trick
by swindlers. It Is often resorted to
by the kind of brokers" who are
now being indicted In large numbers.
They hoodwink the unwary by pre-
tending that they have received in
side tips from this. that or the
next great capitalist to buy . GER
tain stock or stocks. The victims
swallow this alluring bait. hoping to
get rich quickly without going
through the ordinary, workaday
struggle to earn money.
Here, In fact. lies ono reason for
the bitter unpopularity of many
wall Street leaders." The cheated
unfortunates do not always, or even
often find out that the glib talk Of
the takers was utterly false. Ere
Quently the takers tell their victims
that Millionaire So-and-So let them
down." sold out on them" pulled
the plug" played. dirty" and 20
forth. And this. too. II often swal'
lowed. with the consequence that
the losers feel tremendously bitter.
not against tho takers. but against
tho financiers whose names have
been used as bait.
The number of men prominent In
the financial world who arc fim-
Hammers isn't nearly as large as II
generally imagined. The majority
the great majority-are thoroughly
honest. II II were not 30 the whole
financial structure would collapse
from sheer rottenness.
After taking this and everything
else into consideration. however. the
fact does remain. unfortunately.
that q too-great part Of stock mar.
ket speculation II a case OF insiders
playing with marked cards. The In
siders frequently. because OF their
official or other connections, receive
information before the public re-
ceives II. and too many Of them do
not consider Il wrong to wiring prof.
its out OF the public through pos
session Of this International least.
II they do consider 1t wrong they
60 head and do II Just the same.
This Il one reason, among others,
why rather think the rules for
arc likely to be rather drastically
changed by and by. The public
feel they do not get "a fair run
for their money" And all too often
they don't-not 90 much because
Of any condemnable practices by
stock exchange brokers as because
of the family code Of ethics by non
members. some of them dominating
financial or Industrial powers.
others of them of less standing.
From time 70 time in years past
I have urged and urged that the
stock exchange authorities and
high finance to bring about re-
forms, starting with the conditions
under which any new security can
be brought before the public for
subscription. But, although some
thing has been done. not enough has
been done for tho protection Of the
public. Lately the stock exchange
authorities have been working most
earnestly, theoretically and honor
ably to effect housecleaning among
their own members. and their Of
forts promise to bear very valuable
fruit. Yet fear that the trouble
lies deeper than this. and that until
the law makes II criminal TO float
worthless stocks and bonds. and
palm them off on the public under
false representations, there will be
recurrent outbursts Of indignation
such as we are now witnessing.
The danger is that one day tho
"reformers" moved by revenge
rather than by knowledge, win 60
too far-so far as to cripple the
legitimate. the necessary. the indfs-
pensable operations of underwriters,
Of brokers. and Of the stock eI.
change itself, without the existence
Of which modern business and in.
dustry could not be carried on with
out unthinkable chaos.
Hence. obstruction to ciamoredfor
reform should not be carried too far
Il would be wiser TO err. at this
stage, on the side Of radicalism. be.
cause what may be viewed. by eX-
perts in the business, as radicalism
today. may tomorrow be discarded
by the public and politicians as being
altogether too mild. In this con,
nection events In Ireland. In Egypt,
in Germany. in Russia, In China and
elsewhere may we'll be called TO mind
by those who are seeking to insure
conservatism.