Evening star., 1933-06-29

prevented from damaging the natura
flow Of credit and prices"
He said he believed the buying AnC
selling of securities In the ordinary
course of business is proper function
of the public" but that any Artif1cia
activity is an improper function.
Cites Bank Of England.
Kahn suggested the time might come
when Congress would place all bank.
under some authority analogous to the
Bank of England
Pecora then took the witness back
to what he previously had described as
mania in 1929 for buying up every
body else's property"
What were the elements that en-
tered into that maniac" Pecora asked
What were the elements that die
not?" Kahn replied adding: THE first
thing was We thought we were bigger
than We actually are: that We ought
to be the money center of the world
the industrial center, and the greatest
exporting and lOaning country.
There was nothing at that time we
didn't believe was practicable in this
country We cannot be q great ex-
porting nation without being to some
extent an importing and loaning
nation
Many Bad Bonds.
Senator Costigan. Democrat, Of Colo
RADIO. recalled testimony that many bad
bonds" were offered to the public at
the time.
Kahn said many bonds were offered
which should not have been, but which
then were believed to be sound.
AT that time there was hardly 4
sane person in America. We were all
swept away"
Were you inviting investments in
bad bonds?" Costigan asked.
I'VE never have invited the public
to subscribe to bonds We did not be-
lieve to be good" Kahn replied.
Referring to statement by Costigan
in previous hearing about concentra-
ton of wealth in a few hands, Kahn
quoted an economist as saying in 1926
that was erroneous.
More than 81 per cent Of the Ma
tion's income that year, he quoted the
economist as saying, went to those with
annual incomes Of $4,000 or less.
Transactions With Daughter.
Next, Pecora drew Kahn back to his
stock transactions with his daughter.
You owned other shares of these
same stocks. why didn't you sell them
all to her?" he asked.
Il assume she did not have sufficient
money to pay for it all"
Did she exercise her independent
judgment on the question of buying the
stock?"
"She exercised her independent judg-
ment as soon as the matter was
brought to her knowledge. She was
perfectly free to say don't want that.
But she had already bought it," Pc
cora said.
But If she said she didn't want them
the securities would have been taken
back. But it's q most remote posi-
bility she would say that"
Assigned Back in March.
Pecora pressed for an answer as tc
whether she exercised her independent
Judgment. but Kahn said he could not
remember.
Kahn said the stocks were assigned
back to him in March at the advice OF
her English solicitor.
what consideration did you pay?"
None"
"It was transferred as a gift?"
There was no consideration, but the
original trust was transferred and re-
arranged.
Il recall that the stock was used to
set up q trust for her benefit" Kahn
said he did not know why the agree
ment was dated back to December. but
it was done on the advice Of counsel
under belief no one was concerned
other than himself and his daughter.
Arranged by Counsel
Kahn said details Of the stock trans
action in 1880 were arranged h. ht