Evening star., 1961-04-10
BY LOU SCHNEIDER
Consolidated News Features


Actions reveal an inner feel
ing. And recent moves by au-
thorities responsible for the be-
havior of those III the securities
business clearly reveal a fear
of the industry being nailed to
the post as a scapegoat should
stock market prices collapse.
Taking note of the, recent
heavy speculation in securities,
New York Stock Exchange
President Keith Funston warned
the public against unwise in
vesting. He probably knows
that the administration is
watching the present gambling
activity with more than passing
interest.
The wave Of speculation that
has engulfed the stock market
is no surprise. 1t has been in
a buildup process for several
years. 1t can be traced to the
multimillon-dollar widespread
advertising and Peoples Capt.
taliSm" programs of the New
York Stock Exchange.
Trading volume on the Big
Board alone thus. far this year
is well over the 300 million
share mark. With the frantic
pace continuing, 1861 may total
more than that of boom-bust
1929-the only billion-Share
turnover year in history.
Heavy Volume Cited
Since the start Of 1861, the
lib issues listed on the Big
Board rose more than $500
points. 1t means an advance
Of over $40 billion in market
value. Since the elections last
November, the rise in market
value has been over $64 billion.
Wall Streeters don't mind If
some OF their fraternity go in
for publicity. But, Of late, an
overambitious few have en-
barked on publicity. That's
frightening.
Mr.. Funston knows that alPs
not we'll. That's why his warn
ing last week against over
speculation. But it's no differ
ent from his warning two years
ago when he cautioned people
not to invest on the basis Of
tips and rumors.
And the move last week by
the Securities and Exchange
Commission against deceptive
or fraudulent advertising by
investment advisers is a case
Of too little too late. SEC could
have acted a year ago to stop
the wild-promise advertising.
Worse yet, the Federal agency
hasn't done a thing about the
unfounded tips being spread
by partners and employees of
stock brokerage firms. The
only excuse SEC gives is that
it is understaffed. But a crack
down on few big houses would
have frightened all.
SEC is, however, keeping an
eye on stock offerings of less
than 100000. Ten Of these
were recently suspended. Rea-
son: Misleading claims in the
offerings.
+, 400 Punished
Note that the National AS
sociation Of Securities Dealers
sees the scspegoat handwriting
on the wall. too. In less than
IS months it has punished,
suspended or expelled more
than 400 of its members for
bad practices and behavior.
And it is now Tightening the
registered representative quail
flying examinations.
The Nation Federation of
Financial Analysts Societies,
with a $500 membership, is act
ing to tougher examinations
before a securities analyst can
be certified. Now, anyone with
any kind Of knowledge can get
such a job. These fellows write
investment advisor services and
broker stockmarket letters for
the Nations more than Is mil
lion investors. And most guess
not only what will be next
week and next month, but next |
year and the year thereafter. |
SEC has plans to one day
start to investigate the "flam-
boyant and otherwise undesir-
able activities" of securities
statesmen and analysts. But un-
til then, the "overzealous" are