Evening star. [volume] (Washington, D.C.) 1854-1972, 1931-10-04
bar TO BEAR RAIDS
| ON STOCKS SOUGHT
|. BY CHAMBERHEA
Exchange Urged to Limit
Sales to Actual Owners
of Securities.
FEDERAL RESERVE BOARD
ASKED TO EASE DISCOUNT
All Liberality Within Law Sought
in Handling Farm Credits-Trust
Act Amendment Favored.
BY the Associated Press.

BY the Associated Press.
A plan for limiting bear raids on
the Nations security markets emerged
yesterday from big business diagnosis
Of world economic complaints.
Directors of the United States Cham
Der Of Commerce, whose chairman,
Julius Barnes was q week end guest of
President Hoover. recommended that
governors Of the New York Stock Ex-
change take immediate steps to limit
short sales.
They suggested that such sales be
prohibited except by those who have
actual possession of such securities or
who deposit 40 per cent Of the sale
value in cash and give evidence OF
possession OF the remainder.
Easier Discount Asked.
Before passing on the more specific
cures for unemployment the directors
voted that the Federal Reserve Board
should "liberalize its attitude toward
the discount of paper during these
times to the greatest extent possible
within the limitations OF the law and
explained they referred particularly to
farm credits"
Next, the board referred to a refer
endum OF its membership two reports
one dealing with economic planning and
related methods of insuring business
and employment continuity: the othe5
asking amendment of the antitrust
laws for benefit Of the oil, coal and
lumber industries
aI{
the November meeting in Buffalo, when
full reports and recommendations on
FEDERAL taxation and expenditures will
be received for consideration.
Short Selling Held Boon.
TIE chambers stand on short selling
closed week of criticism Of such trad
ing, coming chiefly from Federal off,
cialdom. President Richard Whitney of
the New York Exchange advanced the
contention that short selling was a boon
to finance.
Senator Watson Of Indiana. the Re-
publican leader, said within the last few
days he thought bear raids" had con-
tributed to the depression and warned
stock exchanges they faced a Senate in
vestigation.
Earlier in the year President Hoover
publicly decried organized bear raids
on the wheat market.
Glass Promises Inquiry.
Senator Hastings Republican, OF
Delaware joined WatsonS disapproval
of this stock exchange practice, while
Senator Glass, Democrat, of Virginia re-
iterated that his committee studying
the national banking structure will take
evidence on the use of Fedei al Reserve
funds for stock market speculation.
Several measures aimed at exchange
speculation have been introduced in
past Congresses. Included was a bill
by Senator Glass to levy a per cent
tax on speculative transactions and one
by Senator Caraway, Democrat. Arkan-
sas, TO prohibit short sales on commod-
ity futures exchanges.
The boards recommendation on Fed
eral Reserve credit policies followed an
hours discussion with James C. Stone,
chairman of the Farm Board. The
chamber has long been on record
against the sterilization operations of
the board.
Stone Defends Board.
During a friendly discussion, directors
questioned Stone freely about the
boards work and heard a defense of its
market activities.
''Ninety-nine per cent Of you, facing
the same situation. would have done
what the board did," Stone was re-
ported as saying
The chambers committee on natural
resources, headed by Matthew S. Sloan
OF New York City. reported frankly that
the oil, coal and lumber industries have
reached a point where they cannot 60
on under the old and present condi-
tions ~a
1t. recommended legislation to create
a Federal tribunal to determine when
overproduction exists. Upon such a
finding, producers would be authorized
to enter an agreement to curtail pro-
duction, such agreement to be entered
into or terminated at the option of the
industry or upon the order of the
tribunal at the option of the industry
or upon the order of the tribunal when.
in its Judgment, the condition of in
furious overproduction no longer
exists"
The committee said the Sherman
antitrust law now offers the chief OBJ
stacle to such agreements and therefore
recommended a special tribunal set up
by Congress.
The board agreed its committees
recommendation on employment emo
business continuity should be made
public tomorrow.