Evening star., 1934-05-16
The Stock Exchange Bill.

Lie oIOCh 6ACndnRe Dill.
The stock exchange regulation bill,
with amendments to the securities act
Of 1888, has reached the conference
stage-that stage in which the differ
ences between the Senate and the
House are ironed out or sometimes
lead to hopeless deadlock. Thrown
into conference over the stock ex-
change bill are matters Of great i'm
portance. matters that will be carried
back, In all probability, to the two
houses for final decision before the
measure is whipped into shape for
presentation to President Roosevelt
for his approval. One such difference
is represented in the Senate proposal
for a new commission, with five men,
bers, to regulate the stock exchanges
and to administer the securities act.
At present the securities act is ad-
ministered by the Federal Trade
Commission, and under the stock ex-
change bill as 1t passed the House the
Trade Commission is also given the
additional duty of regulating the
stock exchanges Another Senate
amendment gives to the regulating
commission the duty Of fixing the
minimum margin requirements for
brokerage accounts and loans on Sc
curities by State banks. Maximum
loans by member banks on securities
are to be fixed by the Federal Reserve
Board. The House bill leaves to the
Federal Reserve Board the authority
to fix the minimum margin and pro-
poses As per cent as the proper margin
requirement in normal times. There
are also in conference, of course, the
important changes proposed in the
securities act through amendments
adopted by the Senate.
1t was foregone conclusion that
stock exchange regulation bill would
be passed by Congress. But there is
naturally a tremendous interest in
what final form the measure will be-
come law. In the opinion of exchange
and business leaders the proposed
legislation has gone too
far in both the Senate and House bills.
The conferees, however, will be ex-
pected to act within the boundaries
set by the two houses. There will al
ways be the opportunity to pass. in
the future, amendatory legislation if
1t is shown that the new law is a
detriment, rather than a benefit, to
trade and industry and to the Amer
ican people generally. Indeed, the
Senate has just written into the stock
bill amendments considered
of much Importance to the securities
act which was put through at the
last session of Congress.
A determined fight has been wased
to take from the Federal Trade Com
the administration of the
securities act, as we'll as to prevent
the commissions administration of
the new stock exchange measure
The Trade Commission, it is argued
by those who wish the administration
Of the securities and stock exchange
acts intrusted to an independent
commission, is not accustomed to
deal with securities and the part they
play in business, and the stock ex-
change regulation would add an enor-
nous burden to its already heavy
and complicated duties. Furthermore,
the Trade Commission has, In its
years Of activity. made many enemies
in the business world who complain
Of injustice and oppression.
This struggle over the Trade Com
as the regulatory body to ad-
minister the stock exchange bill has
taken on great bitterness. The un-
usual omission Of Senator Carter
Glass, ranking Democratic member of
the Senate Banking and Currency
Committee, from the list of Senate
conferees on the stock exchange bill
has added fuel to the flames, for Sen
ator Glass was the author of the
amendment which in the Senate bill
places administration in the hands
Of q new commission. Senator Fletcher
Of Florida. chairman Of the commit
tee, has always been sympathetic to
the idea of having the Trade Com
mission administer the proposed law,
and the House voted to place the ad-
of the law in the hands
of the Trade Commission. In the end
the decision as to what commission
will administer the new regulations
may rest upon the wishes of the
President.