Evening star., 1933-07-23
Exchange Control Is Believed
Certain of Congress Action
Robinson Saws Recent Crash Indicates Need for
Reguation-MarginT Trading Ban Regarded
as Likely to Work.

ger Is that the prices may be forced
far below actual and reasonable values
under panic conditions such as have
existed in the exchanges In the last
few days. It Is to prevent such q dis
aster and to give some protection to
the farmers that the conference Is to
be held here tomorrow. to determine
how best to deal with the situation.
The same situation exists with re-
gard to the rush to sell securities on
the stock exchanges. Once panic con-
djtions prevail, securities drop In price
far below their real value and business
Is likely to be demoralized, despite the
fact that stock market trading has no
consumption Of goods.
Present Act One Step.
President Roosevelt. In his message
to Congress on March 20, recommend
ing Federal supervision Of trafac in In
vestment securities In interstate COM
merce, clearly said that the securities
act, now q law, was only "one step In
our broad purpose Of protecting inves-
tors and dep6Sitors" He continued:
1T should be followed by legislation
relating to the better supervision OF the
purchase and sale Of all property dealt
In on exchanges, and by legislation to
correct unethical and unsafe practices
on the part of ofncers and directors
Of banks and other corporations"
Ohio, during his campaign last August.
indicated 1t was his belief that Federal
control must be undertaken II the stock
markets are to be dealt with properly
He said on that occasion: For the
very simple reason that the very many
exchanges In the business Of buying
and selling securities and commodities
can by the practical expedient Of NOV
ing elsewhere, avoid regulation by any
given State, proposed the use Of Fed
eral authority In the regulation Of these
exchanges"
President Roosevelt, who ct the time
was Governor Of New York. had been
criticized by his Republican opponents
because he did not exert the authority
Of the State Government to deal with
the New York Stock Exchange when
security prices took . nose dive.
Quiz Of Leaders Planned.
Committee has for the better part Of
two years been investigating the stock
exchange and its operations. Ferdi-
nand Pecora. counsel for the commit
tee, already has announced In. New
York. he Is going to question stock ex-
change officials and others regarding
the recent bull market and the crash Of
last week
This investigation was still under way
when the Congress adjourned, and was
continued with hearings ON the oper-
ations Of private banks after that ad-
journment. II the committee had any
idea that the public would not be
caught in another gambling crash so
soon after 1929. it missed its guess.
This latest bunch Of suckers" which
has now lost its shirt, came to grief
not in the administration Of former
President Hoover. but during the Roose-
velt administration. In view Of al the
circumstances. 1t is expected that the
Senate committee will not delay much
longer in making . report to the Sem
ate and in drafting legislation, which
may have the approval Of the admin
lstration, to bring about q measure of
control Of the exchanges. Such legis-
lstion undoubtedly will be based upon
the interstate commerce clause Of the
United States.
Should conditions In the markets be-
come SO serious that action be de.
manded Of the administration the be-
lief prevails that the President will not
hesitate to exert all the powers of the
Government in the premises. 1t was
suggested last night that II the Presi-
dent was able by proclamation to close
the banks OF the country-for which he
obtained authority Of law later-he
might also close the exchanges.