Evening star. [volume] (Washington, D.C.) 1854-1972, 1929-08-17
Little Opposition by Admins
tration Leaders or Others
Seems Likely.
MOTIVE is TO SOLVE
INVASION OF CREDIT
Struggle Between Spectators and
Reserve Board Seen by Some
in Congress.
BY DAVID LAWRENCE.

Prospects of a Senate investigation
OF the money market has passed beyond
the talking stage. Definite plans for
the inquiry are being made, and 1t is
difficult to see how it can very well be
opposed either by the administration or
anybody else.
Attacks on Wall street are still as
popular as ever in Congress; and when
Senator demands an investigation OF
what is happening in the stock market,
1t is politically dangerous for any other
Senator to oppose the demand, for few
men i'll public life have ever ventured
to defend the financial interests, and
particularly the speculative element.
The pressure for an investigator OF
how the money market is affected by
speculation does not come merely from
an academic interest such as members
of Congress have occasionally displayed
in stock market operation and creolt.
but appears to have been developed by
the battle between the Federal Reserve
Board and the speculative element.
Titanic Struggle Seen.
Some members of Congress see IT,
tanic struggle between the spectators
and the board, with the latter trying to
protect the credit resources of the Fed
eral Reserve System from being in
Vaded by the stock market operators.
The mere fact that the Federal Reserve
Board has been for the last several
months bitterly opposed in Wall Street
has engendered suspicion in congress
Sional uqarters that perhaps the board
does not have sufficient power to curb
speculation.
The theoretical purpose of the inquiry
will be to find basis for remedial legls-
lation, but the actual motive is to flnd
out just what influences are endeaVorlng
to monopolize credit and to force cur
rent interest rates to high scale. The
politician knows that there are far more
persons borrowing money for commercial
purposes than there are votes among
the large spectators. And the issue OF
trying to get something for the con-
sumner at lower cost is always the nu-
cleus of political campaigning.
The large as well as the small busi-
ness men of the country are just be-
ginning to learn that an added item
has gone into their overhead expenses
the higher cost of money. Congress
would in any event wish to penetrate
the ramifications of Wall Street OPP
Grafton. but when it is walked up with
higher cost of living-for there are
members who can prove that the high
interest rate brings higher cost of COM
modities-then there is a fertile field
for political exploitation and the in
quiry fever.
May Be No Dissension.
When the resolution comes up for
passage it is doubtful whether there
will be many dissenting votes. The
Western and Southern Senators will
press the issue and the Eastern mem
bers will hardly be able to offer oppo-
sition for fear of being misunderstood.
The Federal Reserve Board will be
the center of interest because 1t has
endeavored to fight the speculative ele-
ments without asking for increased
legislative power. Members of the
board feel no additional legislation is
necessary. This means that the board
will stand between the radical elements
in Congress and the Wall Street groups
who have been trying to thwart the
policies of the board.
And even though the investigation
does not lead to any legislation it will
force the hand of the Federal Reserve
Board again, just as the February warm
ing is supposed to have been direct
result of the debates in Congress and
the threats to make mandatory some
of the discretionary powers which the
board has reluctantly exercised.
Copyright, 1929