Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-10-02
SHORT SALE POLICY
STATEMENT URGED.
Declaration of Principle by
Exchange Would Help
Investing Public.
BY JOHN F, SINCLAIR.

relish public disgrace" Nonsense!
Rudolph Spreckels has another Sug
gestion. He wants Congress- to prohibl
short selling for one year. as emergency
legislation only.
John j. RaSkob, who never sell:
stocks short" thinks it's far healthier
not to interfere with the law of supply
and demand, upon the theory that fol
every seller of a stock there's always 6
buyer.
Comparatively few people sell stock:
short I" probably not one III
ten knows anything about it. They're
afraid of short selling. People in
stinctively are afraid of things they dc
not understand Short sellers are few
in number, but usually holder, more
courageous and more nervy than long
buyers.
Is short selling a crime? When a
company issues millions Of shares OF
stocks and unloads them at an inflated
figure on the public when times are
good that is crime. Yet that trans
action is not short sale.
A short seller today is one who be-
lleves that certain stocks are not
worth what they are quoted at-that
they are not worth the market price.
So he decides to sell that stock, upon
the theory that it should be brought
financial balloons"
THE real public enemies today are
insiders who are trying to hold stocks
far above what they are really worth,
said a banker to me in discussing the
matter
Another said this: IF you are 60
ing to prohibit short sales, then you
had better prohibit long sales. too, Tor
lust as much skull duggefy and nlanlp-
,,1o@;o,, toka folorn m tina long side as
on the short side"
The difficulty, of course, is in the
ignorance of the vast majority OF
people. They know nothing about the
Short sale. But they should. If they
did. they would realize it is impossible
to carry on a natural free market with
out an ability to sell as well as to buy
But the New York Stock Exchange
should tell the American people what
objections it has to eliminating or re-
etricttng short sales. In these times,
when people are nervous and over
wrought, an announcement and an eX-
PLANTATION should be given to confused
and bewildered investors.
HitIer's Outbursts.
The spectacular outbursts of Adolph
Hitler, German Fascist leader, has OBJ
scured the sensational news OF the new
deep sand oil gusher in the Nlenhagen
field, Germany, 80 miles from Hanover.
This gusher is reported capable OF pro-
ducing $500 barrels day.
Two wears ago the Elwerath Co.,
small German organization, brought IN
a 7OO-barrel well at 2,400 feet. NOW
comes this latest announcement, which
brings Germany with bang into the
oil producing class.
Germany is producing about 1,250, 600
barrels of oil annually-about D per
cent of its total consumption. Amerl-
can oil men, including Harry +. Sinclair
and Edward G. Schubert OF the Standard
oil Co. of Indiana, have been lnvestl-
eating the German fields in recent
weeks This important discovery Is
the first major result OF the growing
movement in Germany toward orliinls
deeper than heretofore.
1T means" said Todd Pettigrew, one
of the largest American oil operators IN
germany. that not only Germany, put
possibly all Europe, may oscome ln r,
pendent of the importation OF oil. Ihat
Is why American oil men IN increasing
numbers have been making Tips 10
Northern Germany in recent weeks.
PERTAINS this German oil boom VIII
do for. Germany what oil did TO OKLA
homa-give it fresh start
Branch bdnkiHS'
r. S. Hecht, New Orleans banker
chairman of the Economic Pohcy CoHl-
mission of the American Bankers Asso-
citation, told the bankers at CleVeiaiAu
substantially this: -.
Branch banking is inevitable
IT'S lika a tide coming in. 1t has us
weaknesses and objections. Inc oIu
INIT pank is doomed. Branch banking
fits into the scheme of modern business.
whether we like it or not. SO, instead OF
fiphting the new movement longer, let
cooperate with it, regulate ana oirect
its course.
From now on the American BANKERS
Association will not oppose the extern
sion of branch banking in principle. It's
useless. The record of 800 bank fan-
llres curing the last 10 years-mostly
in he farming sections, tying up assets
of nearly $1,000, 600, 000-must not be
Mr.. Hecht pointed out that now there
are 2T5 group or chain bank organlza :
lions, comprising near.y 10 per cent OF
the total unit banks of the country, with
bank resources of about $4,000 GOO, 600.
Nn,etv-tWo per cent of the bank fail
ures have been in places of less than
10000 people. The handwriting on the
wall Joints the way and the bankers
have decided TO quit fighting the branch
banking idea.
When the proper State and Federal
legislation is enacted, group and chain
bankers will probably reorganize to mt
into the various branch banking systems.
1 think it can be safely said, II the
present trend continues, within 10 years
branch banking as a national nstltu-
ton will be q reality.
Branch banking will have the support
Of an impressive group of American
bankers from now on.
British Conference.
Great Britain herself is the key To
the success of the British Imperial Con-
ference now in session. The theory OF
protection is agreed to by the British
dominions-has been for years Canada
Australia, New Zealand and South
Africa all have protection at home anc
believe in preferential duties within the
British Empire. Their leaders have re-
peatedly so stated in the past. Theil
representatives are ready to bind them
selves in such an agreement.
But Great Britain hesitates. Sht
knows her century-old free trade polio,
made her the worlds richest and mos
powerful nation.
The Labor government Officially
stands for world free trade. Both Pre-
rnier Macdonald and Chancello
Snowden have advocated it repeated,
since they have taken Office. But nov
what?
Unless Great Britain arranges he
fiscal policy to provide measure o
preferential return TO the dominions TO
what the dominions have given hel
then the dominions will be forced {
look to other countries and conside
favorable trade arrangements with ma
tions outside the empire" says tn
financial Post, Canadas leading bust
ness weekly.
So the political and financial leader
of Great Britain study and survey an
wonder, while the dominion leader
wait in London fer an answer.
(Copyright, 1880. by North American News