The Washington times., 1931-02-21
MART CONTROL
IN HANDS Of
PUBLIC
Experts, 0versoId, Forced to
Boom Prices of Many
Stocks; Rally to Continue
BY JOHN E. NEVIN, JR,
Financial Editor

bH JOHNIN NE WIN, JN'
Financial Editor
The public, usually the tool Of
expert market manipulators and
generally the sucker in all securi-
ties deals. today holds the whip
hand in determining the trend of
the market. one Of the foremost
bankers in America intimated
last night.
Odd-lot buying of stable stocks
for investment purposes by smaller
operators and the public generally
has created che of the, most un-
usual situations ever seen in Sc
curities markets. This buying,
which has been going on for
months on a small scale, has
caused the withdrawal of much
of the floating supply of stocks
from the market and is causing
serious concern to market manipu
latorS.
Forced to Boom Market
Experts, who have been selling
the market short in the past few
months and who have not covered
their shorts now find themselves
in a position where they are
forced to boom the price of stocks
in order to purchase securities
to cover their obligations. 1t has
been possible in lie past for these
men to cover their operations. due
to the large floating surplus of
stocks that were available. How
ever, the public has withdrawn
these stocks from the market and
their operations have caused serl-
Gus curtailment of the floating
supply.
Faced by a lack of securities
with which they may cover their
shorts, brokers. experts and
manipulators concerned are now
forced to boost the price of
stocks so that the public will
place in circulation the securities
which they have withdrawn, the
banker intimated.
The banker, who enjoys an in
ternational reputation in finance
and who for obvious reasons does
not wish his name used, declared:
Mart Is Weak Now
"It must be emphasized that
the condition of the stock mar
ket at this time is not funda-
mentally sound for a prolonged
rise. The peculiar position
which experts are placed in has
forced them to take desperate
steps to clear up their ObIiga-
tons and has made many of
them boom the market so
that they may cover their
Shorts"
AS conditions now stand. the
banker added, the general public
stands to reap a fine harvest
from the sale of securities which
they now hold. He cited several
specific stocks in which there is
very large short interest and
only small floating supply. In
some instances. he said. certain
stocks are definitely oversold. He
added:
Shorts Must Cover
"ShOrt sellers are placed in
q position by the present con-
ditior of stocks where they
must force the prices of securi.
ties up in order to force the
public to sell them in the mar
ket. However, that may not
be possible for it has been
learned by Wall Street that
the stocks held by the public
have been purchased for IN
veStment purposes and the he
lief that when business gen.
. orally returns to normal
plane. they will pay excep.
tlonally good dividends.
1t is believed in some circles
that the public will hold their
stocks and will not return
them to the market. If that
proves true it will make il
very embarrassing to short sell.
ers and will bring about cur.
tailment of the. practice"
1t is the belief of this 1inan.
ccler that the market rally will
oe continued for some time due
10 present conditions. He de.
clared that here is no precedent
Ior the present market and that
therefore the time limit of the
rally could not be gauged,