Evening star., 1928-11-10

Sltuatlon ana JoOK ~ %S#,, 81
a few glanceS at 3. " 49,
the future. Among
other things. Mr.. Eugene E. Thompson
Thompson said:
Never have we assembled under such
securities market conditions as have
prevailed this year. The volume OF
, transactions on the exchanges will
probably be double that of any other
year in our history. The rapid advance
in the values of stocks and stock ex-
change memberships has been beyond
the expectation of any one. We ask
ourselves if we shall return to the old
order, and who dares to say that we
shall? Predictions mean little, if any,
thing, but doubt if We shall ever see
the old times again. do not refer to
prices of securities, but to volume.
"The increase in the number of
shareholders of our corporations has
been phenomenal. A prominent New
York financial newspaper recently eS-
timated that there were 100000 own
erS of corporate securities. Estimates
have been made by competent authori-
ties placing the number of individual
investors close to 100000; the differ
ence between 100000 and 100000
being accounted for by many holders
being owners of stocks in more than
one corporation.
Huge Sums in Common Stocks.
'It is many years. certainly beyond
the experience of any of us, since there
has been so prolonged and sustained
a period of high money rates. These
abnormal rates have bafTled the aver
age investor, and in their effect on
securities prices have upset all calcu-
lationS of prognoSticatorS. Apparently
business has not been checked or even
slowed down, and there is no indication
of any recession in the volume of Se-
curitieS transactions.
1T Is true that prime investment
bonds have been adversely affected by
high money. On the other hand, both
the investor and the speculator have
not heSitated to pour their funds into
common stocks in the belief that the
common Stockholder will have a large
share in the growing prosperity of our
country.
Much has been said and written of
the high prices of common stocks.
Some stocks have risen to heights
which, it is said, discount their poten-
tial earning power for many years. Com
mon sense and ordinary caution admoniSh
us that there is some point at which
sane and sensible buyers will stop. 1t
may be that some of US are pioneers
in new field and our binders prevent
our seeing the guide posts, If, indeed
there be any, on this new road to the
great prosperity that lies before u.s.
My belief in this prosperity is un-
bounded.
Urges Greater Standardization
Standardization appears essential if
we are to make progress in safeguard
ing or listingS. The fundamental need
is for concerted action in restricting
listings to those corporations that are
ready and willing to give to the ex-
changes such information as we deem
essential in the interest of the buying
public.
~The mails continue to be the most
active agency in the promotion of the
work of the fraudulent promoter. 1t
Is growing practice to which we
should lend our support in stamping
out. Fake devices and tipSter sheets
are daily flooding the mails, and this
method Of fraud is growing to enor-
NOUS proportions. The ingenuity of
the promoter is such that he is ready
to spring new method as soon as the
old method wears off. We must keep
pace with the fraudulent practices, as
the growth of the sale of fraudulent
and misrepresented securities. is in ac-
tive competition with legitimate busi-
ness.
Rights of Banks and Public.
'"The advantages of local exchanges
are becoming more and more apparent.
Cooperation between bankers, invest
ment dealers and brokers will tend to
broaden the markets for local Securi-
ties. The first step comes when we ask
the banks to loan on what we have
listed. The bank has right to as
sumo that the security is proper one,
properly issued and properly distributed,
all functions which the exchanges had
thoroughly looked into before listing.
THE exchanges have also a RESPONSE
bility to the public In connection with
the issuance of new securities through
the giving OF rights to present stock
holders. II the proposed security is
a new one, is it not just as important
that 1t pass the scrutiny of listing
committee as # it were an underwrit-
ten or syndicated offering? I think so.
Let us regulate and conduct our
business so that the public will repose
in the exchanges that confidence and
trust with which we trust each other
in our trading and upon which the
whole structure of our trust is laid
confidence"
Heard in Financial District.
DR.. Hugh p Baker. manager Of the
trade association department of the
United States Chamber of Commerce.
will address the National Coal Associa-
ton at its annual convention in Cleve-
land next week
J. & w. Seligman & Co. have sold
privately 5000 shares of Great Atlantic
& Pacific Tea Co. stock, no new finan-
cling being involved
The New York Stock Exchange has
admitted to trading General Motors
new common stock, $40 par, on a when
issued basis.
The American Railway Express Co.
has declared the regular quarterly divi-
dend Of $3.50, payable December 81 to
stock Of record December Is.
The protective committee of the Dis
trict Bankers Associations, Howard
Moran, chairman, held a meeting yes
terday afternoon
The local institute chapter is trying
TO keep this years expenditures within
$24O87 the amount required last year
The officers are doing some very close
figuring.
General Rron1n Earninus