The Ypsilanti daily press. (Ypsilanti, Mich.) 1928-1962, 1940-12-13
Babson Says Small Concerns
Favored by Exchange Group

New York City. Dec. 13-It be-
comes more and more apparent
that the Securities and Exchange
Commission has done a remarkable
job in protecting the interests of
the average investor. The Com
mission has proved a good watch
dog OF the market. Originally. the
SEC Act OF 1888 called for the
registration OF all security offer
ings to the public in excess OF $780,
600. This ceiling was raised some
time ago in certain cases. The
Commission announced on DeceIu-
Der that domestic issuers of Sc
curity issues up to 100000 are
now exempt from the registration
provisions of the Act. They need
not even fill out a prospectus.
This Will prove a great aid to small
concerns. 1t Is a step in the right
direction by the SEC. The Com
mission should, however, move the
lid over a little more and ulti-
mately put the exemption up to
100000.
The Sc, has never used the
power OF the law embraced in the
Security Act to its fullest extent.
| believe the Commission is cons
cious of its power but, at the same
time, Is resolved to treat bus
ness gently. Small businesses, now
in need OF new capita. should inn
mediately take advantage of the
new and simplified procedure. To
raise up to 100000 requires now
only letter to the nearest regional
office in which firm gives notice
OF its intent. Enclosed with this
letter should be copies of any sell
ing literature. Larger concerns
also will, undoubtedly, be aided in
the near future through being re-
CURED to submit less complicated
data.
Industries Hipped on Bigness
The trouble with business today
is that it is like a church without
a Sunday School. Without Sunday
Schools, as feeders for church
memberships, the doors of our reli-
gious houses would have to close.
Our business structure. likewise,
needs more small concerns which
in time can grow into big ones.
One normal reason for unemplo.-
ment is the lack OF employers.
My father always felt a mans
standing in his community depend
oil W haitian he
ployer or an employee. Amy young
man who wants to become an emf
ployer should be encouraged to get
into business for himself.
Smaller and younger business
concerns should be favored by
government agencies and bankers.
This is also the best way to pre-
vent monopolies. Unfortunately,
young business men and small con-
Germs have received scant, IL any,
encouragement up to the present
time from government agencies.
Private agencies, particularly the
banks, have also given them the
cold shoulder. Banks with funds
of depositors to invest are still
attracted to the commercial paper
OF large concerns at rates OF one
half to one per cent. Most of our
bank officials have forgotten that
the present size Of many OF our in
situations was brought about by
the faith and interest their pre-
decessors showed in the small bust
ness man and small concern, In
fortunately, collateral has super
seeded character in the minds Of
two many bank directors.
A Suggestion to investment Houses
Exactly how much business has
been lost to investment dealers
through private placements Of
stock. bond. and note issues, as a
result OF the SEC regulations, will
probably never be accurately
known. That the investment bank
ing business has dried up since