The Ypsilanti daily press. (Ypsilanti, Mich.) 1928-1962, 1941-01-31

new pollcy OF the securities and
Exchange Commission should be
good news to every part Of the
country but New York,-and per.
haps not bad news for even New
York. This is what | learned yes
terday when passing through Wash
ington. The SEC has nothing
against the New York Stock Elk.
change per Sc: but it does not
want 1t TO have a monopoly OF all
the stock exchange business. This
is its main reason for Directing to
the New York Stock Exchange at
tempt to prevent its members from
operating on other exchanges. The
Commission feels that this is a
deliberate endeavor. on the part of
New York bankers, to dry up these
other exchanges and put them out
OF business.
Decentralization the Keynote
find, however, that the SEC has
some reasons for this move which
should be very helpful to cities n
the Central West, the South, and on
the Pacific Coast. The Comm ssion
is not opposed to speculation pro-
vided it is carried on in a legitimate
manner and distributed properly
throughout all sections of the coun.
try. 1t, therefore, believes that the
smaller stock exchanges. In the
smaller cities, should be strength
ened and even subsidized, rather
than handicapped as the New York
bankers apparently want TO handi-
cap them.
Such a decentralization program
should encourage more trading In
the securities OF smaller compan es
and thus "decentralize" the trading
which is now confined to the blue
chips. This program should not
only broaden the market, but so
tend to prevent the terrible 'up-and.
down" fluctuations which gre newt.
able when the dealings are 500 In
the blue chips. Naturally. New
York bankers and owners OF New
York real estate will fight this
movement; but 1t should be back.
ed up by all interests in other
cities.
Already the SEC has regional OF.
fees in several cities as follows:
Atlanta, Boston. Chicago. Cleve-
land, Denver. Fort Worth, New
York City. San Francisco. and Seat
tie. In addition, 1t has branch and
temporary Offices in Detroit, Los
Angeles, New Orleans, Orlando
(Florida), Philadelphia, Jackson
(Miss), ST. Louis. st. Paul. and
Tulsa. The new idea, however.
contemplates that, beginning next
month. there will be complete
registration facilities in their Cleve-
land and San Francisco Offices. II
this program is satisfactory and in.
creases the number OF new issues
put out, it will be extended to other
cities where the SEC now has
Offices.
This new program is also i'm
portant in showing a changed atti-
tude on the part OF the Commission.
1t has concluded that both q restora-
ton OF employment and sound de.
tense requires that industries be
encouraged to issue new securities
and that investment bankers be
helped to market these securities.
The PROPOSED legislation affecting
bank holding companiesfs another.
step along these lines This new
attitude should be OF benefit to
every reader OF this column, wheth-
err factory owner, merchant. or
wage worker.
The Utility Program
! am sorry to say that I@have
not found any inclination In Wash
ington to make life easier for the
utilities. For few months be-
fore election, 1t seemed as II the
utilities were at last going to get
better treatment; but since Presi.
dent Roosevelt's reelection, Wash,
ington seems to be getting tough
again. The following three lines
OF action are reported to be on the
cards:
/. Adoption OF rule requiring
utility companies to obtain sealed
bids from underwriters or private
investors on the sale OF all securi.
ty issues oyer f1.000.000.
2. Adoption OF regulations re-
stricting the payment OF common
stock dividends by utility lcom-
panies as a means OF forcing up,
ward revision OF depreciation ac-
cruals or the "plowDs back Of
,more earnings.
8. Adoption OF general policy
Of requiring capital revision, IL
thought necessary, In connection
with all new financing; requiring
systematic debt reduction and
greater use OF common stock for
financing.
Defense Helps Small Communities
Thus far the only real defense
against night bombers is decentraii-
cation. This is why the govern
ment is asking that the new indus
trial plants be built In smsller com
munities. This same program will
continue even after Word War H..
The day OF 'Ign~ss" is over as ap'
piled to a CORPORATION building one
big factory for an essential indus
try. This. In way. supports the
governments plan OF having ell
public utilities hooked together so
that 10 one powsrhouse, or dam, is
smashed, the people will be abe
to get electricity from other
sources. This means. that decen.
trallzatIon 10 being supplemented
with interdspendencs. The old say
ing, Every cloud has silver lin
ling" applies even to World War ii.
1t is stopping the dangerous, fov OF
money. industry, and people to a
few big cities. Instead, II Is dis
tributing these blessings through
out the nation as q whole.
When the Federal Reserve sys-
TEN was started. during the hrs'
Wilson Administering, the country
was divided into IL districts. with
one reserve bank located in p lend