Evening star., 1934-05-27
House Yields to Senate on
Glass Plan, But Retains
Rule on Margins.
WAGNER LABOR MEASURE
WINS FAVORABLE REPORT
Two New Commissions, Both Pos
sibly Permanent, Soon to Be
Added to Government.
BY GOULD LINCOLN,

lie NOOSeVelI administration mas
agreed to the formation of two new
presumably commissions.
One is the commission to regulate the
stock exchanges and handle the opera
ton of the securities act. The other
is the National Industrial Adjustment
Board, provided for in the Wagner
bill. passage of which the President
has recommended as a means of meet
ing the strike situation.
President Roosevelt did not want a
new, separate commission to deal
with the stock exchanges. He pre-
ferred to have this Job done through
the Federal Trade Commission. which
is administering the securities
act Of 1888. The House backed the
President in this position.
Senate Backs Glass.
But the Senate backed Senator
Glass of Virginia in his demand
for a separate and new commits
sion to handle the regulation of
the stock exchanges and at the
same time to carry on with the Securi-
ties act. The President and the House
have, it appears, yielded to the Senate
in this matter. for conferees Of House
and Senate on the stock exchange bill
finally agreed yesterday to the new
commission idea, after first obtaining
the assent of the President.
The upshot of the matter is that
the President will have another new
commission Of five members to ap-
point. and that lot of new jobs
under this commission will be created.
The Federal Trade Commission will go
back to its original status, the status
which it occupied before it took over
the administration of the securities
act. regulating trade practices on the
part of business.
Means Heavier Expense.
This new commission will mean
considerably heavier expense to the
Government, on a permanent annual
basis, than had the original plan to
have the Trade Commission take over
the stock exchange regulation, an
additional expense estimated to run
as high as a million dollars year.
The House conferees on the stock
exchange bill, while they yielded to
the Senate on the formation of the
new commission, won out in their de-
mand for the House margin provisions
of the bill. The House bill provides
that the Federal Reserve Board fix
the margin requirements for doing
business on a stock exchange. 1t
further provides that for the initial
extension of credit in stock dealing,
an amount not greater than 55 per
cent of the current market price OF
the security, shall be allowed. In other
words, the margin put up by the pur-
chaser of stock shall be not less than
As per cent Of the value of the stock.
Margin May Be Changed.
This margin figure may. however,
be changed by the board later IN
accordance with the judgment of the
board. The Senate provision dealing
with margin requirements left the de-
cision with the new commission and
did not undertake to set any standard
Sucn as CDe 40 per CeIlI Hal gin IC-
quirement written into the House bill.
The new stock exchange regulation
commission is to be called the Federal
Securities Exchange Commission. and
its five members are to be appointed
by the President and confirmed by
the Senate. Not more than three of
the commissioners shall belong to the
same political party. and in making
the appointments members of differ
ent political parties shall be appointed
as nearly as may be
practical.
Each commissioner is to receive a
salary of $4,000 a year and is to be
appointed for a term of five years,
except the terms of the original COM
missioners shall expire at staggered
intervals, so that all their terms shall
not end at the same time.
A lot is expected of the operation
of the stock exchange regulation law
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