250 The Stock Market Crash—And After

ures showing the progress of total loans obtained for
the purpose of carrying securities for distribution,
together with the general conditions which prevail in
the money market.
Most of the preceding suggestions are evidently
based on the idea that safety standards should be set
up as to loans in relation to stock prices, earnings
and all other pertinent facts, just as standards have
been set up as to lines of credit extended by banks
to corporations as related to quick assets and liabilities.
 This project is a highly technical one which
bankers and brokers should grapple with until, as
Mr. Lounsdale said, the brokers’ loans should mark
a “scientific” figure.

Rediscount for Brokers’ Loans
[ would add this further proposal, that if the
Federal Reserve Banks were authorized to rediscount
 brokers’ loans, the influence of the Federal
Reserve System, Federal Banks and Federal Reserve
Board would be more easily exerted upon the member
 banks and less easily evaded. As it is now, a
member bank, while it cannot rediscount a broker's
loan, can rediscount other paper to take its place,
and by indirection can really evade the law which
now attempts to prevent the rediscount of loans with
collateral security. If the rediscount of brokers’
loans were permitted the banker would be far more
likely to lay his cards on the table instead of attempting
 any evasion; he would become more subject to