Evening star., 1931-12-16
Everybody's
Business
Stock Exchange Head Ex.
presses SUPREME Conf
denee in u. S. Ability to
Meet Problems Short
Selling Held Aid to
Market.
BY DR.. MAX WINKLER.

N.
Special Dispatch to The Star.
NEW YORK, December 16-Su-
prenfe confidence in the future of
the United States and its great business
and industrial organizations was ex-
pressed by Richard Whitney, president
of the New York Stock Exchange, in
the course of an address yesterday eve
ming before the Syracuse Chamber of
Commerce.
Mr.. Whitney came out once more in
defense of short selling which he re-
CARDS as a necessary part of an open
market for securities. In a crisis, he
continues, buying by short sellers serves
to maintain an orderly market. He also
calls attention to the fact that the pub
lie at large entertains greatly exag-
gerated ideas about the extent to which
short selling has been carried on.
The real trouble with the market and
the cause of declining prices is. accord
ing to Mr. Whitney, the unWillingness
on the part Of the public to buy securi-
ties.
Short RumOrs Hurt.
One need not quarrel with Mr.. Whit
ney's views. The difficulty, however,
resides in the fact that most of the
vicious and ugly rumOrS about banks,
investment firms and corporations-nay,
the Government itself-are circulated by
those committed to the short side of
the market. 1t is these rumors which
almost invariably cause irreparable
damage.
With few exceptions the banks in the
large cities have continued to demon
Strate their soundness and strength
throughout the past decade, including
the depression years of 1880 and 1881,
according to J. w. Pole, controller of
the currency
Mr.. Pole renews the plea for legisla
ton to permit trade area branch bank
ing by national associations. The pur-
pose Of the legislation. he says. is to
supplant the system of unit banking bv
permitting the stronger and better
managed banks to carry on operations
in the surrounding rural communities
by means of branch Offices.
Rail Situation Discussed.
If large number of railroad re-
celVerShlpS are to be prevented. many
OF the weaker lines should receive as
slstance without delay. To this end
the Railroad Credit Corporation, Just
organized, will aid a number Of weak
carriers in maintaining service on their
funded debts and in meeting maturing
short term loans
1t is generally felt that number of
banking institutions will make advances
10 the corporation TO anticipate recsipts
oy IL from the proceeds of the higher
rates to be allowed the railroads. The
advances are expected to be made un-
Ger special type of loan agreement,
winch Will give the banks a first lien
en- the increased freight receipts as re-
ceived by the corporation.
Before President Hoover announced
the one-year debt holiday he consulted
with the principal representatives Of
both parties. and after being assured CT
their support the moratorium Was pro-
claimed and put into effect. DESPITE
assurances given six months ago, poll
tlclans do not hesitate to impede. what
ever constructive work the Nation S
Chief Executive proposes.
Public Owns Bonds.
Some Of the opponents 70 the mora
torium, which has been in effect since
july !. are under a distinct m!SaDpre-
hension. To them, the moratorium was
cevsed to aid the so-called interests
tHat Is, the international bankers. who
are supposed to own foreign securities
Nothing can be further from the truth.
DOnOS,
nor did they ever own them. 1t is the
public which has bought and owns the
hundreds of millions of foreign issues
which the bankers have sold them.
Unless railroad labor will voluntarily
| agree to 10 per cent wage redaction,
the demand will be made tor a Is per
cent cut by the Atchison. Topeka e.
Santa Fe road under the procedure Of
the railway labor act according to w.
B. Storey, president of the road
However the management of his
road Mr.. Storey says. is willing. to con-
fer first with representatives of those
labor organizations with whom it has
contracts such as the Big Four Bro
therhoodS and the one or two national
labor organizations.
Guarantee Misapplied.
To some of the southern neighbors
Of the United States a guarantee is not
always what the term implies. The Re-
public of Colombia has lust refused to
permit the expectation CT gold to meet
service charges on the dollar bonds CT
the Agricultural Mortgage Bank, despite
the unconditional governmental guar
antee of the bonds.
The rather precariouS situation of
the mortgage bank business in Colom-
Uld, lOSetneI WIFI IIlt adverse economic
conditions in the country. doubtless mas
prompted this action. The direct debt
of TIE republic continues to be taken
care of promptly. For how long. it is
difficult to determine with any degree
of certainty.
1t is gratifying to observe Franco
German cooperation in one direction
and strange to see difficulties between
the two countries IN another. The iron
and steel cartel of Poland obtained
early this year from a group of German
and French banking houses a credit of
50 100000, repayable January 81, 1882.
Because Of the shrinkage in business,
repayment would have caused the cartel
inconvenience, so an extension of the
credit was granted.
Why could not the same sane and
rational policy be applied west of Ger
many as it is in the east?
(Copyright 1881, BY the North American
Newspaper Alliance, IncD