Evening star., 1932-05-10

manipulation OF the STOCK market, the
booming of the market and the burst
ing of the market
Mr.. Whitney's Ignorance.
The vicious practices of the market
are well known, but they are hard to
prove. Mr.. Whitney, the president of
the Stock Exchange. was amazingly ig-
norant of manipulations and pools. For
some time he even denied their exist
ence, though there are dozens of books
in the library which devote long dis
cussions on the manipulations of pool.
VIII. Whitney drove the committee to
seek information from other quarters.
The committee has to get actual
proof. Many men come to me who
know the New York stock market, its
ins and outs-its ups and downs-and
who are familiar with the methods OF
robbing the public, but are not willing
to testify before the committee. They
insist their names must be withheld
They say the system will get them
They will be ostraciZed; their credit
will be curtailed. They will be driven
out of business. They will be made
bankrupt. and some actually go so far
as to express fear of their lives They
tell me the system has so many rami-
fcationS. 1t Is even claimed the Chi
cago gangsters are interested in certain
manipulationS. 1t has a string on so
many people that it has friends in ev-
cry place. high or low. The number of
manipulators is small. The lambs are
many. In this game, the SO have no
chance against the one-the wolf.
One of the leading operators. who
was compelled to testify under oath be-
fore the Banking Committee as to stock
market manipulations, frankly ex-
pressed fear of his safety and said Ca
pone was piker compared to these
people.
Senate Committee Divided.
There has been much division of
opinion in the committee as to the ad-
visibility of proceeding with this in
vestigation and as to what remedy
might be applied. One Senator frankly
stated in print that Congress should not
interfere with this institution or its
practices. He shares the views of the
exchange-that all the regulating they
need is to regulate themselves.
I am happy to say, however. that I
believe majority of the committee are
for a real investigation, both of the
bulls and the bears, no matter who gets
hurt by it, for they believe in the end
" Will 1lCAp W 1ESlOlC q DCltEl COllultlOl
throughout the country. / believe a
majority of the Senators consider it
just as wrong to misrepresent the value
of a stock or bond as to sell rotten eggs
for fresh eggs.
A generation ago only few stocks
were listed on the market. Property
was owned by individuals, not by cor
porations. Today the reverse is true.
The average man or woman in the
Eastern section of the United States
now owns very little property, except
as shares in some big corporation. or
bonds on same, and these shares and
bonds are being manipulated up and
down to the great loss of those who
actually own same. believe that own
ers of shares should be protected by
law, the same as the owners of a home,
a farm, or a town lot; they are not so
protected now. If your property is In
the form Of stock or bond, a manipu-
lation of the market may make you
poor in a day, even though you are
not a speculator. If the market prac-
ticeS had been more fair and the in
vestor had been protected, there would
not have been such severe depression,
there would not have been so much un-
employment. But the manipulators are
powerful and they don't intend that
anybody shall interfere with their
game.
Stupid Money.
One of the witnesses before the COM
mittee declared that the violence of
speculation was caused by stupid money
in the hands of stupid people.
Some of this stupid money found its
way into membership on the New York
Stock Exchange. One member, who
was a theater ticket agent in 1918,
found his way into the exchange in
1920 and at the peak Of the bull mar
ket had eight memberships among his
partners.
Newspaper Criticism.
The management of one newspaper
which has called the investigation lone
of the most fantastic affairs that un-
reason could create" is closely aSsoci-
ated with a great bank and large OIL
producing concern, neither one of which
would enjoy public examination of its
affairs.
Another critical journal has presi-
dent who was in the midst of the in
vestment trust movement. One Of his
pet trusts enjoyed price range for its
shares between $3.50 and cents.
Fleeing the Public.
Testimony before this committee re-
garding the Radio pool showed that
brokers participated in the pools and
pool manipulations One Of these brok-
ers was the specialist of the stock in
which the pool dealt. At least he oper-
ated through use of his wife's name.
There was no regard for anything ex-
cept profits. The public was not con-
Sidered
This is even a violation of the rules
nF tho Na,ry Vcrb