Remedies and Preventives of Panic 243 
months to come, and application of necessary 
remedies as indicated, saying: 
“The result undoubtedly will be the reorganization 
of a great many banks which have become overbur- 
dened with doubtful paper. This happened after the 
panic of 1920, and has also happened in the case of 
practically all preceding panics.” 
Without attempting to prejudge this proposal, it 
should be remembered that the panic of 1929 was 
unlike all preceding panics. Under its unique condi- 
tions, the member banks were well out of debt to the 
Federal Reserve banks. The banking system met the 
demand for additional loans without disturbing 
money market rates. Had they not met it, these 
rates would have soared, as is usual in panics, when 
men and institutions must borrow at any rate to pre- 
serve their solvency. 
Proposal of an Artificial “Floor” of Minimum 
Prices 
A very constructive proposal by James H. Rand, 
Jr., but unfortunately not acted upon, was that the 
New York Stock Exchange establish an artificial 
“floor” at the minimum of prices as of a given day 
of the panic. 
This expedient had already been employed at the 
reopening of the stock exchange on the outbreak of 
the World War in 1914, after the five months’ sus- 
pension of its activities. The application of this 
measure is described by H. G. S. Noble, President of 
the Exchange at that time, in his book, The New