“YOU CAN'T ARREST A MILLION DOLLARS”

Manawatu Times, Volume LV, Issue 7134, 4 February 1930, Page 7

“YOU CAN'T ARREST A MILLION DOLLARS”

Canada’s Financial Drama

BROKERS RELEASED TO SAVE COLLAPSE THREAT OF WIDESPREAD RUIN United Press Association. —By Electric Telegraph.—Copyright. Received Monday, 7 p.m. VANCOUVER, Feb. 1. Canada this week has watched tho amazing financial drama in which threatened wreck loomed so widespread ‘that the highest law officers of the Dominion were obliged to come to the reseuo of highly-placed people they had just attacked. In one forenoon, five' leading brokerage houses were raided and 11 of the principals were arrested.

Colonel William Price, AttorneyGeneral for Ontario, has directed the battlo against the alleged dishonest "bucketing” brokers, who have scores of branches throughout the country. He closed these up and asked the Stock exchange to expel mining share operators, who last year alone handled more than £4,000,000 of public moneys. For one day, the Stock Exchange operated without these brokers. Overnight, however, the Ontario Government feared a financial crash that would rock the Dominion, and early on Saturday it was announced that the accused brokers would be re-admitted to the Exchange. The Attorney-General was forced to capitulate to a definite threat that, with the accused brokers prohibited from trading, there would be a panic end the unprotected stocks of thousands of small holders would be wiped out, and in the case of Criminal Court charges against the brokers finally not being proven, these speculators, large and small, would havo good cause for legal redress against the Government of Ontario.

Curiously enough, the Government of Manitoba also found itself in a desperate position, and protested violently against Ontario’s action in seizing the offices and bank accounts of accused brokers. Manitoba’s prosperity is entirely dependent upon a stabilised wheat price. Two leading brokers were carrying millions of bushels of wheat on margin in the Winnipeg market. Their bank account seizures occurred on a day when wheat reached its lowest point of the season. Noon on Friday saw a situation where 10,000,000 bushels of wheat would have been dumped on the market within an hour. The Premier of Manitoba announced that the entire resources of the Government would step into the market to stabilise the situation, for he feared a panic that would have carried the price away under 3/-. On Saturday, morning the Ontario police released onough of the brokers’ money to bolster up the wheat market and the crisis passed with Liverpool cables announcing an advance of two cents overnight. The week finished with the Government leaders coming to the realisation that some business is sometimes too big to bo disciplined without far-reaching and unexpected results.