Evening star., 1932-04-28
BULL RADIO POOL
Of 1880 RECALLED
Spectacular Rise and Fall of
Stock Was Feature of
Market.
Special Dispatch to The Star.


NEW YORK, April 28.-As it was one
of the most conspicuous speculative epi-
sodes in the short-lived and ill-advised
bull market in the Spring of 1880, the
manipulations of the pool in Radio
Corporation Of America common stock
at that time are worth recounting. The
Senate Investigating Committee has
already touched lightly on this episode
More may be heard of it later.
There are outstanding 1890, 900
shares of Radio Corporation common
stock. No dividend has ever been paid
on this stock. Because of the charac-
ter of the business from which its
earnings accrue and its connections in
the industrial world. it has been a spec
ulatiVe medium easily influenced by
all sorts Of sensational rumorS. The
psychologists of Wall Street recognize
these facts. In 1880 they set out to
capitalize them to a maximum degree
Official Record.
1t appears from the official record of
Stock Exchange transactions that the
beginning of the accumulation by the
Meehan pool was somewhere between
the latter part of January and the first
week IN February. In the week Of
January "a Radio common was quoted
around S35 share. 1t moved up that
week to 1912 on turnover of about
100000 shares. II duplicated this per-
formance, both as to fluctuations and
volume, in the next week. In the week
OF February it rose from 36I to 4O8a
and in the week of February IS from
1895 to'43ls on a total of about 1.I55,-
900 shares. Then the velocity of the
buying increased with the turnover of
l,l36,000 shares in the week of Febru-
ary Y, when the range was from Al
70 ASA.
During the first three weeks in March
the stock advanced about 9 points, or
from 4334 to above SO, with total sales
Just under 1900 900 shares. Some light
ening OF the pools lead evidently oc-
CURED at this time, for the stock re-
acted to 46ss and the volume dimin-
lshed. Then the real fireworks started
In the week Of April Radio rose from
81 to 621s. with transactions in excess
OF Z,00O,OOO shares. In the next three
weeks 1t jumped to its top price of
69@s on turnover of 3,50O,O00 shares
From the starting point in January to
the day when the manipulation and
heavy distribution was completed a
total OF nearly 100000 shares had
been executed, or an amount well in ex-
cess OF the total R. c. A. common out
standing.
Then followed those operations which
gradually relieved the pool of its hold
lngS and passed them on to the public
Between the Week of April 26 when
the stock sold at 692s. and that of Nav
~, when it had dropped to about al
there were 100000 shares in the turn
over. In the next three weeks there
were wide fluctuations. which carried
the stock at one time above SIS. but only
moderate transactions of about 600 600
SnareS weekly. Before the middle of
June Radio had lost all of its gain he
tween January and April, and any one
VINO bought it in that period and still
held 1t was out of pocket.
To-Day Radio common is selling at
ABOUT 50 share. The 13, 100000 shares
nave nav a market value approximating
9oo,ooo'ooO, compared with 0,0OO. 900
MHGh' on type OF manipulation that
ranks With short selling during a panic
it appeared as a stock of extraordinarv
value and with a limitleSS price possi-
bility.
Effects of Pool.
The ill-efects of this radio pool were
not confined to those who credulors1v
followed the members of it. They had
wide market ramificationS. This tempo
raFliy succeSStul operation encouraged
pools in other stocks and helped to
gloss over situations that were obviously
unsound and to spread I. feeling of Sc
curity when there should have been
every effort made to anticipate the
dangers both in the market situation
and in industry that were developing
1t also contributed to the creation of a
feeling of hostility on the part of the
public toward Wall Street and the New
York Stock Exchange.
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