Evening star., 1934-03-27
WHITNEY RESUMES
STOCK BILL FIGHT
Testifies After President
Demands Measure "With
Teeth in It."
(Continued From First Page.)

ments which would virtually rewrite
the revised measure.
The President served notice late yes
terday he would fight to have the
Fletcher Rayburn measure passed
speedily.
The Chief Executive, in letters to
Senator Fletcher and Representative
Rayburn, asserted the measure as 1t
now stands should not be weakened"
and added:
1T has come to my attention that
a more definite and more highly
organized drive is being made against
effective legislation to this end than
against similar recommendations made
by me during the past year"
Senator Fletcher and Representative
Rayburn, chairmen of the committees
handling the BILL at once hastened
plans to report practically identical
measures into both chambers before
the week Is out.
The text of Mr.. Roosevelts letter
follows:
Before I leave Washington for
few days holiday want to write you
about a matter which gives me some
concern.
"On February 9, 1894, I sent to the
Congress a special message asking for
Federal supervision of national traf-
flc in securities.
1T has come to my attention that
more definite and more highly organ
ized drive is being made against ef-
fective legislation to this end than
against similar recommendation made
by me during the past year. Letters
and kilograms bearing all the ear
marks of origin at some common
source are pouring in to the White
House and the Congress.
Blames Wild Speculation.
"The people of this country are, in
overwhelming majority, fully aware
of the fact that unregulated specula-
ton in securities and in commodities
was one of the most important con-
tributing factors in the artificial and
unwarranted boom which had so
much to do with the terrible condi-
tions of the years following 1929.
"I have been definitely committed to
definite regulation Of exchanges which
deal in securities and commodities.
In my message I stated. vt should be
our national policy to restrict, as far
as possible, the use Of these exchanges
for purely speculative operations
IT am certain that the country as a
whole will not be satisfied with legis-
lation unless such legislation has teeth
in it. The two principal detectives
are, as I see it:
"First, the requirement of what Is
known as margins SO high that specu-
lation, even as it exists today. will OF
necessity be drastcally curtained; and
Second, that the Government be
given such definite powers of super
vision over exchanges that the Gov
ernment itself will be able to correct
abuses which may arise in the future.
Hits Price Manipulation.
1--WE must of course, prevent in so
far as possible manipulation of prices
to the detriment of actual investors,
but at the same time we must elm
mate unnecessary. unwise and de-
structive speculation.
THE bill, as shown to me this aft
ernoon by you seems to meet the
minimum requirements. I do not see
how any Of us could afford to have it
weakened in any shape, manner or
form"
In the light Of the Presidents ideas
Of what the bill should contain, the
measure would impose a minimum
cash margin requirement Of so per
cent, with an optional provision in
tended to permit somewhat lower
margins on the more stable stocks.
For control and supervision, it gives
the Federal Reserve Board power to
regulate the amount Of speculative
credit flowing into the market and
the Federal Trade Commission au-
thority to regulate market practices.
Several manipulative practices would
be prohibited outright.
The exchange has complained that
the margin provisions virtually would
force many of its member firms out
OF business, due to the restriction of
trading that would follow. In ad-
dition, 1t has contended the bill would
give the Trade Commission virtual
control Of every corporation with
listed stocks.