The Call to Order
THE CALL TO ORDER DAYS of panic in investment circles, with Wall Street completely demoralized and a score of kindred exchanges following suit as heartily as possible, have revealed at least one...
...Sooner or later Congress will probably resound with debates regarding the proper method for increasing the available number of guardians...
...And yet it is to the bankers that one must look for guidance in reorganized investment buying...
...THE CALL TO ORDER DAYS of panic in investment circles, with Wall Street completely demoralized and a score of kindred exchanges following suit as heartily as possible, have revealed at least one or two interesting truths...
...Good and bad aspects of the situation have been maintained with relative steadiness, so that the "earnings" of prosperous corporations and enterprises should continue...
...But there has been a good deal of tampering with money, and most forms of credit have been affected...
...Given reasonably responsible government, prosperity will take its own sweet course, rising, ebbing and rising again without reference to the decisions that are made in high places...
...Properly understood, that is a cargo of sound common sense which might desirably be shipped to more citizens than one could count in a day...
...There is also an interesting political corollary...
...Had there been no such widespread eagerness to share in a "rise," the psychology which has dominated one of the worst weeks in financial history would have been impossible...
...The result is obvious from the ineffectiveness as an influence upon public psychology of bankers' conferences held during the crisis...
...The first is the extent to which a great mass of citizens have been relying upon speculation as a means for enlarging their incomes...
...Billions of dollars were "created" through a simple process of bidding up paper to the dimensions of gold-tinted air castles...
...There are many things which a social agency can do for the general welfare...
...It is, of course, impossible to estimate the effect of the collapse...
...Quoting Senator Tydings's remark that, since the Republican party has "the whole machinery of government" under control, it "must take the responsibility for things which have gone awry," the New York World supposes that the eminent spokesman for Maryland "intended to be nonsensical...
...But recent events manifest a very saddening array of things government cannot do...
...If anything is clear by now, it is that no party has anything to do with prosperity...
...It is hardly reasonable to expect, however, that the whole supply of Colonel Sellerses can be suppressed...
...But concerted warnings against the perils of inflation and mere gambling, if associated with judicious handling of credit, might introduce an element of design into what is now a fairly perilous chaos...
...Since many banks had frankly encouraged speculation, even at a time when federal committees were somewhat boisterously advertising their alarm, it is not surprising that their words of good cheer during the storm failed to reassure anybody...
...The public is committed to the market...
...This has become a field everybody considers himself entitled to till, in some small measure, and it is both useless and undesirable to harangue against the practice...
...Industrial and other economic conditions seem to be pretty much what they have been during recent years...
...It is," says the World, "a reductio ad absurdum of the claim made in every election that this party or that party is solely responsible for whatever prosperity the country may enjoy...
...One's hope is merely that, eventually, some adequate plan for protecting the conservative investor can be devised...
...Americans have told themselves so frequently that "the country is sound" that it may not be out of place to suggest occasionally that this happy state, like other mundane blessings, is transitory...
...How to inoculate citizens with sanity and caution, or even elementary horse sense, is a query it must leave unanswered...
...For months business leaders and statisticians have been frankly pessimistic about the outlook and may now treat themselves to the virtuous pose which accompanies a justified "I told you so...
...Reasonably responsible government...
...Eventually few of us profit by wholesale individual failures, and the effect of the present disaster may prove to be far more significant than now appears...
...The extent to which normal investment aspects of securities had been ignored was evident from the circumstance that, while high-grade bond issues were selling most attractively, stocks in the spotlight were airplaning at prices utterly out of keeping with earnings or basic values...
...The matter of financial regulation is certainly one of them, and on the whole the government of the United States has acquitted itself excellently here...
Vol. 11 • November 1929 • No. 2
