Evening star., 1934-03-06

WASHINGTON Ex-
change situation T. n0'ker'
The Exchange here is almost eX-
clusively an investment market, he
told the committee. There is 70
margin trading and virtually all the
transactions represent purchases Of
stocks and bonds for the account of
local investors. Most of the active
members are dealers and underwriters
of securities. Their present organiza-
tions have been built up and their
personnel especially trained for the
performance of both functions.
To force these dealers to abandon
either phase of this business would
not only work great financial hard
ships on them. but would also neces-
state the disruptions of their present
organizations. With the almost COM
plete absence of new undertakings at
the present time and the very low
volume of commission business. the
enactment of this section would
doubtless force number of smaller
dealers to close their offices.
If these dealers are forced to give
I'D their stock exchange memberships,
they would not only lose the revenue
they now make in commissions. out
they also would lose their investments
in stock exchange seats, since l feel
quite sure that our Washington Stock
Exchange could not continue to eX-
ist," Mr., Booker asserted.
Danger to Investors.
Washington investors would be de-
prived of the protection provided oy
the daily published quotations OF the
exchange and washington banks
would also suffer, since they would be
deprived of the benefit of publlshed
quotations in the valuation of local
securities for collateral purposes.
Clients Ct individual dealers would be
inconvenienced. since most people pre-
fer TO transact all their investment
business with one firm. Under this
section they would be compelled to do
half of their business with one firm
and the ether half with another firm.
II would also like to say word re-
garding section 7. which would pre-
vent member of all exchange bor-
rowing on listed securities except from
a Federal Reserve bank Mr.. Booker
added.
This would be great inconven-
fence anc would increase the operat-
ing expenses OF many dealers. In the
case of my own firm, we keep the
larger portion of our capital in securl-
ties, largely Government bonds. We
keep a portion of these securities with
our New York correspondents, who
are members of the New York Stock
Exchange. Our correspondents re-
ceive in New York and pay for prac-
tically all securities which we pur-
chase there and charge our account
with the amounts paid.
Section : Attacked.
The securities are Immediately
shipped to us, when We deliver them,
collect the money from cur clients
and forward it to New York. This op-
Grafton usually requires from two to
three days. Our New York corre-
spondents are therefore constantly
making us loans which are being con-
stantly paid off, the entire operation
being covered by book entries.
Under section they would no
longer be permitted to render US this
service and we would be compelled
either to maintain a large amount OF
cash idle in New York. or else be con-
Stantly making and paying eff COL
lateral loans at the banks, with all
the red tape filling in notes, subStitu-
ton of collateral, etc, that goes with
it," said the exchange official in con-
CluSion.
Mr.. Booker appeared at the hearing
at the request of President G. J.
Gockeler and a committee which he
appointed, consisting of w. w. Spaid.
of w. B. Hibbs g. Co.; James NJ.
johnson, of the investment firm by
that name, and Mr.. Booker 1t was
decided to take up only matters of
vital importance to the exchange
here which had not been touched
upon by representatives of other eX-
changes in their testimony.
Brahany Heads Ticker Club.
Thomas w. Brahany, manager of
the Washington Office of E. A. Pierce
81 Co.. was elected president of the
Washington Ticker Club at the an
nual meeting held yesterday in the
Hibbs Building. He succeeds Karl w.
Corby, partner in w. B. HibbS & Co.
Ralph M. Wolfe, manager of the
local office of Mackubin, Legg & Co,
was elected vice president, and
Chauncey G. Parker, jr., member of
the firm of Auchincloss, Parker e.
Redpath, was made secretary-treas-
urer.
Mr.. Corby. the retiring president.
and Frank J. Thiel, manager of the
local office of J. S. Bache &, Co.. were
named to the Board of Governors
which also includes the above officers.
The Nominating Committee con-
sisted of Charles Carroll Morgan.
chairman; George A. Garrett, Harmer
Reside, Chester H. Lockwood and
Frank j. Thiel Their task was not
very difficult as the vice president is
always advanced to the presidency
Mr.. Brahany, the clubs new chief
executive, has had long and varied
experience in the financial district.
During the meeting two new members
were elected, John E. Parker, one of
the managers of the local Office of
G.. M. P. Murphy & Co., and Louis
w. Laudick. partner in Fenner g.
Beane. Both are veteran financiers
Exchange Trading Heavier.
Trading picked up a good deal on
the Washington Stock Exchange to-
day. First sales were in Potomac
Electric Power 5l2 per cent preferred
at 108, up half a point. Other sales
IN the same issue were recorded later
The company's per cent preferred
moved at 10912.
Capital Traction was well out front.
five transactions involving so shares
taking place at 26 The closing bid
was 26, with q asked The rest of
the stock sales were in Lanston Mono
type. 40 shares selling at 48, and in
Washington Railway g. Electric pre-
ferred, which moved at 81.
Bonds were quiet. $1,000 Railway
g. Electric As selling at 80. The bid
on Anacostia Railroad guaranteed SIS
was advanced to 96 and the asked
price in Capital Traction IS was