Brokers' Deal

No class of businessmen has received a bigger dose of the New Deal than U. S. brokers. First the New Deal brought them business such as they have not had for months, business in volume and with a vengeance. Last week the Chicago Board of Trade shut up shop on Friday noon and on Monday noon instead of 1:30 p. m. as usual. The reason for voluntarily abandoning the two half-day's business was that brokers and Exchange employes were physically worn out by the rush of June trading in grain. In Manhattan the New York Stock Exchange reported transactions of 125,000,000 shares in June, the biggest volume for any month on record except October 1929 (141,000,000 shares). In the two months of May and June the Exchange had a turnover of 230,000,000, more than twice the total turnover of the preceding four months. But if the New Deal brought back the life blood of business to brokerage houses which had all but perished of anemia, brokers found themselves recovering in a new and severely regulated world. The New York Stock Exchange, trying to keep one jump ahead of the boot of Reform swinging vigorously from Washington, promulgated two new regulations: First it ruled that no market letter be issued by a brokerage house without a certified copy bearing the name of the writer and the approval of a member of the firm being filed for record. Object: to fix responsibility--for grammar, said one wag. Second it ruled that no broker could carry directly or indirectly a speculative account for any salesman or customer's man of his firm or any other brokerage house. Object: to secure disinterested advice for customers, to strike at the evil of customer's men giving advice from which they hope to profit on their own speculations. Evidence of how the Exchange has been successful in tightening its belt of restrictions was the announcement last week that the famed argument between the Exchange and Allied Chemical & Dye Corp. (TIME, May 8 et seq.) had been settled. The Exchange appeared to have won its point: that Allied would have to give its stockholders the information which the Exchange considered due them. The details of this agreement were not made public last week but Orlando Weber of Allied wrote to his shareholders telling them that a joint statement by the Exchange and Allied would soon be issued, that Allied stock would not be dropped from the Exchange.

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