Responsible government in the Dominions: Responsible government in the Dominions

The work of the Stock Exchange

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Multivolume work

Identifikator:: 1896933912

Document type:: Multivolume work

Author:: Keith, Arthur Berriedale http://d-nb.info/gnd/119086794

Title:: Responsible government in the Dominions

Place of publication:: Oxford

Publisher:: Clarendon Press

Year of publication:: 1912-

Collection:: Economics Books

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Volume

Identifikator:: 1896934455

URN:: urn:nbn:de:zbw-retromon-236504

Document type:: Volume

Author:: Keith, Arthur Berriedale http://d-nb.info/gnd/119086794

Title:: Responsible government in the Dominions

Volume count:: Vol. 1

Place of publication:: Oxford

Publisher:: Clarendon Pr.

Year of publication:: 1912

Scope:: LI, 568 Seiten

Digitisation:: 2022

Collection:: Economics Books

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APPENDIX 589 those whose opinions as to what risks are worth while differed from ours. . . . Every transaction of buying and selling necessarily involves a risk. Betting on merely incidental results of particular contests is the assumption of a risk which did not exist before the bet was made. It would seem as if a fair distinction of this kind might be made, speculation being defined as the assumption of inevi- table business risks of fluctuating values; gambling as the assumption of purely artificial risks in connection with some fortuitous event.” (H. C. Emery, “Should Speculation Be Regulated by Law,” Regulation of the Stock Exchange, pp. 830-832.) (Vb) “When carried on in connection with either commodities or securities it tends to steady prices. When speculation is free, fluctua- tions in prices, otherwise violent and disastrous, ordinarily become gradual and comparatively harmless . . . For the merchant and the manufacturer speculation performs a service which has the effect of insurance . . . The most fruitful policy will be found in meas- ures which will lessen speculation by persons not qualified to engage in it. In carrying out such a policy exchanges can accomplish more than legislatures . . . We are unable to see how a State could distinguish by law between proper and improper transactions, since the forms and mechanisms used are identical. Rigid statutes directed against the latter would seriously interfere with the former . . . Purchasing securities on margin is as legitimate a transaction as the purchase of any property in which part payment is deferred. We, therefore, see no reason whatsoever for recommending the radical change suggested, that margin trading be prohibited.” (Hughes Commission Report of 1909 on Speculation.) (Vc) In an address “The Work of the New York Stock Exchange in the Panic of 1929” delivered in Boston, June 10, 1930, President Richard Whitney stated: “A third lesson from the panic is, in my opinion, the necessity of maintaining flexible requirements concerning margins, not only upon security collateral loans, but also upon stock brokers’ customers’ accounts. It was fortunate that at the beginning of the panic both classes of margins were unusually high. It was equally advantageous during the panic that both classes of margin requirements were dras- tically reduced. Sometimes students of finance speak as though the sole necessity was always to maintain very high margins. Actually, margin requirements should be flexible, and high or low as circum- stances dictate. For precisely this reason I am opposed to legislative enactments compelling inflexible and invariably high margin require-

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