Marking Time

The baby bull market took a breather last week. After hitting a new high of 190.44 in the Dow-Jones industrial average, the market sagged, then surged up again to 190 at week's end.

Wall Street's bulls were not worried by the lull. A mild reaction, they said, was natural after ten successive days of rising prices. What heartened them was the fact that trading slumped off when prices did, and perked up when prices rose. Brokers were as happy as larks; the turnover of 13,372,338 shares made the biggest week this year.

Emil Schram, president of the New York Stock Exchange, was not entirely happy. He fired off a blast at the Federal Reserve Board's 75% margin rule. If margins were cut to 50%, said Schram, and the 25% tax on capital gains were reduced to 12 1/2%, the public might be more willing to come into the market. It would provide the money--through common stock issues --that industry needs for expansion. Cried he: "Instead, industry is driven to borrow from insurance companies or banks ... I cannot understand why it isn't better practice to have several thousands of persons, maybe several hundred thousands, owing the banks a billion dollars, secured by $2 billion of common stocks or ownership in American industry ... In one case you have distributed risk, while the other is bound to be more concentrated."

The stockmarket got a new boss cop last week. Edmond M. Hanrahan, 42, a member of the Securities & Exchange Commission, stepped into the chairmanship. He succeeded able James J. Caffrey, who found that he could not live on his $10,000 salary. Hanrahan, who learned about business and finance as a Manhattan lawyer, joined SEC two years ago. Wall Streeters should get along with him. He has no reputation as a reformer, and thinks that SEC's job is primarily law enforcement.

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