Causes of the Panic 
43 
brokers’ 10ans, laid its finger on another actuating 
cause of the break in these words: 
“Industries had been financing working capital 
more and more through the issuance of securities, 
and this has resulted in a slower growth of commer- 
cial bank loans and a more rapid growth of loans 
against securities, together with a holding of idle 
funds periodically by many industries.” 
These idle funds naturally sought employment at 
the high rates which the stock market afforded as a 
consequence of the restrictive policy of the banks. 
The resolution of the American Bankers’ Association 
speaks of the resultant total of so-called brokers’ 
loans as a “spectacular figure, whereas it should be 
scientific figure.” As a spectacular figure, this 
reflected stock market fluctuations that were'unsound 
and detrimental to the public good. The resolution 
adds that it leads to ‘‘threats of financial legisla- 
tion, which if carried out, might be even more 
harmful.” 
Were Investors Sold Out Rather Than Selling? 
The Commercial and Financial Chronicle (of 
November 9, 1929) takes issue with myself and 
others who have believed that the stock market had 
attained a permanently high plateau-—not, be it 
understood, a permanently high peak—above all 
previous plateaus of stock prices. “In the last 
analysis,” the Chronicle said, “the break in the 
market was due to the fact that stocks had been 
carried to absurdly high levels.” Moreover, the