Mr. PECORA. What kind of advertising or publicity does the exchange go in for, as distinguished from newspaper advertising ?

Mr. HARRIS. They do no advertising whatsoever. Their publicity is mostly the publishing of these documents and various letters and speeches of the president, and sending them out.

Mr. PECORA. I notice in the minutes of the meeting of the committee on publicity held on May 19, 1933, the following item [reading]:

The suggestion of Mr. Westerfield that our present mailing list of college professors be expanded to include all of the economics faculty of the principal universities was approved.

Do you recall that action?
Mr. HARRIS. Yes, sir.
Mr. PECORA. Who is Mr. Westerfield, who made that suggestion ?

Mr. HARRIS. Mr. Westerfield is an assistant secretary of the stock exchange. He is not an officer.

The CHAIRMAN. Does not the stock exchange issue a bulletin?

Mr. HARRIS. Yes, sir. The stock exchange issues a bulletin weekly, which gives all data pertaining to sales of memberships, dividends, and other statistical matter; and another bulletin monthly that is gotten out by the Department of the Economist, that shows the averages of all stocks, the number of sales of bonds and stocks, the number of shares traded in, and a chart showing the dividend yields, and statistical data of that sort.

The CHAIRMAN. Is that handled by your committee?

Mr. HARRIS. That is handled by the Department of Economist. The committee on publicity pay for it, though. The expenses are charged to the committee on publicity for those statistical data.

Mr. PECORA. I notice in the minutes of the meeting of the committee on publicity held on March 24, 1933, the following item [reading]:

Mr. Westerfield reported on conversations he has had with a Mr. Amos, of The American Federationist, published by the American Federation of Labor, with reference to the exchange running a series of paid articles in that paper. The president also reported on correspondence with a Mr. Widden, of the Journal of Commerce, with reference to a suggestion that the stock exchange advertise. The committee did not approve.

Do you recall that?

Mr. HARRIS. Yes; I recall that. Mr. Pecora, I was present at that meeting, was I not?

Mr. PECORA. Yes; according to the recital in the minutes. Did the committee, at this meeting of March 24 last, disapprove of the suggestion that the exchange run a series of paid articles in the American Federationist?

Mr. HARRIS. They did.

Mr. PECORA. And also disapproved of the suggestion made in behalf of the Journal of Commerce?

Mr. HARRIS. Yes, sir.

Mr. PECORA. I notice in the minutes of the meeting held on February 27 last the following entry [reading]:

The secretary submitted the following memorandum from the president giving an opinion of the law committee with reference to giving publicity material to public schools:

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" I have your memorandum of January 27 regarding the giving of publicity material to public schools. This matter I have referred to the law committee today, and they agree to the present practice of the committee on publicity, it being understood that the material furnished should be the general publicity material of the exchange, from which the desired information can be compiled by the inquirers for use in textbooks, et cetera. It was specifically agreed that no employee of the exchange should actually write the text of the books to be used."

Mr. Westerfield asked the advice of the committee as to whether the above authorization included permission to give copyrighted photographs of the exchange to reputable writers and publishers for use in school textbooks. The committee approved, subject to the general policy, which is to give such publicity material only on specific solicited requests.

Do you recall that?
Mr. HARRIS. Yes, sir.

Mr. PECORA. What is meant by the expression in the concluding sentence of that item, which I will read again to you (reading):

The committee approved, subject to the general policy, which is to give such publicity material only on specific solicited requests.

Mr. HARRIS. In other words, the exchange would send out none of its publicity material unless it were requested. Unsolicited, they would not send anything. Does not that paragraph, at the start, take up the sending of it to schools? Mr. PECORA. Yes.

Mr. HARRIS. They would send it, then, to no school that did not request it.

Mr. PECORA. I am a little uncertain about the meaning of the phrase“ specific solicited requests.” Does that mean requests of the stock exchange were to be solicited by the stock exchange?

Mr. HARRIS. No, sir.
Mr. PECORA. Then why the reference to "solicited requests"?

Mr. HARRIS. If the institution, if the school, should solícit from the stock exchange or should ask for these data

Mr. PECORA. That would be a request, would it not?
Mr. HARRIS. Yes; but that is the meaning of that phrase.
Mr. PECORA. Why the use of the adjective “ solicited”?
Mr. HARRIS. That is the intent of that meaning there.
Mr. PECORA. A request in that form would not be a solicited request.

Mr. HARRIS. The secretary may be in error in his English in writing it up, but the purpose of the committee was never to send out any of those data to any school unless the school first requested them of the stock exchange.

Mr. PECORA. What would be a solicited request, as distinguished from an unsolicited request !

Mr. HARRIS. Well, I should think an example would be if a school here in Washington should write to the New York Stock Exchange requesting them to send them a certain specific pamphlet, or any documents that they had sent out that year to educational institutions.

Mr. PECORA. That would be a solicited request ?
Mr. HARRIS. Yes, sir.
Mr. PECORA. What would be an unsolicited request?

Mr. Harris. In case the stock exchange—and it is their policy never to do so—should send to a school, unsolicited, of the r owir free will, on their own initiative, documents dealing with the work ings of the exchange.

Mr. PECORA. That would not be a request at all, would it?

Mr. HARRIS. No; it is not a request. I say it would be done on their own initiative.

Mr. PECORA. On the initiative of the exchange.
Mr. HARRIS. Of the New York Stock Exchange.

Mr. PECORA. In the minutes of the meeting of the committee on publicity held on January 26, 1933, I find the expression“ unsolicited requests” used as follows (reading]:

A request of the board of public education of the school district of Philadelphia for a loan for an extended period of the stock exchange films was approved. The president was requested to secure from the law committee an opinion for the future guidance of his committee, with respect to policy in connection with supplying public schools with publicity material, such as copyrighted photographs of the exchange for school textbooks, pamphlet material in quantities, and the loan of our motion-picture films. The feeling of the committee on publicity was that there can be no objection to the sending of publicity material to schools on specific unsolicited requests.

What did that mean? What did you understand by the use of the term “unsolicited requests” in this entry in the minutes ?

Mr. Harris. I know the policy of the committee on that matter, Mr. Pecora, and that is just as I explained before, never to send any data unless they have been requested by the school first.

Mr. PECORA. You have references in these minutes both to unsolicited requests for publicity material and solicited requests. There is some difference between the two. As I understand your definition of a solicited request, it is a request that was not solicited by the stock exchange.

Mr. HARRIS. Yes.
Mr. PECORA. Then what is an unsolicited request ?
Mr. REDMOND. May we see the minute book there?
Mr. PECORA. Yes (handing book to Mr. Redmond).

Mr. REDMOND. Mr. Pecora, I think it is clear that it is “unsolicited requests ” in both cases. The typewriting is not very clear in this second meeting, but it was clearly written" unsolicited", and it was intended, as the witness has said, to express the policy of the committee that the requests should be unsolicited in both instances. Is it not perfectly clear that it was typewritten “unsolicited” in both cases?

Mr. PECORA. It is also perfectly clear that the prefix “un” in one instance is marked out, is it not?

Mr. REDMOND. No; I think it is blurred, but I would not say it was marked out.

Mr. PECORA. Well, I think it is a little bit more than blurred.

Mr. Harris. I am sure that this is a typographical error, Mr. Pecora.

Mr. PECORA. Well, why any reference at all to “unsolicited requests” if there were no solicited requests? Why that characterization of requests?

Mr. Harris. Mr. Pecora, I cannot say any more on that than it expressed the policy of the committee since I have been on it, and that is that they never send data of the description that we are discussing unsolicited to schools, unless the schools ask for it first.

Mr. PECORA (after examining document further). Mr. Redmond, don't you think there is an ink stroke drawn through the prefix



“un” at page 112 of the minute book of the committee on publicity?

Mr. REDMOND. It is blurred, and there may be an ink stroke, but clearly, if there was intended to be a correction of the minutes, we would have found that prefix rubbed out or we would have found it clearly stricken out. It is possible that there is an accidental pen stroke there that has blurred the prefix, but it was clearly typed “ unsolicited ” in both bases, and that is the policy of the committee.

Mr. Pecora. How can a request be solicited? What is the reason for defining some requests as “ solicited ” and others as solicited "?

Mr. HARRIS. I do not think there is, Mr. Pecora. I think there is just one class; that is, subject to the question whether or not that “ unsolicited” is crossed out or not. I think it is a typographical error, but I really cannot say more than

Mr. PECORA (interposing). Why is there any necessity for mentioning unsolicited requests at all if the exchange does not solicit the making of any requests?

Mr. HARRIS. I cannot speak for the English in the book. All I can do is repeat the policy of the committee.

Mr. PECORA. Now, Mr. Harris, you have been a member of the exchange for 7 years, I think you said ?

Mr. Harris. Yes, sir; I believe it is 7 years.

Mr. Pecora. And a member of the board of governors, or the governing committee for 4 years?

Mr. HARRIS. I have been a member of the governing committee since May 15, 1928.

Mr. PECORA. That is nearly 5 years.
Mr. Harris. Nearly 5 years, yes.

Mr. Pecora. Has a treasurer's report for the exchange as institution ever been seen by you?

Mr. HARRIS. Yes, sir.
Mr. PECORA. Is it ever circulated among the members?

Mr. HARRIS. I am not on the finance committee. I am not certain as to that. I see it regularly.

Mr. PECORA. You would know as a member whether or not an annual balance sheet, we will say, of the exchange is given to the members?

Mr. Harris. I see it myself regularly and—no; I don't think it is.
Mr. PECORA. Do you know the reason for that?
Mr. HARRIS. No, sir.
Mr. PECORA. And it is not published in any year book, is it?
Mr. HARRIS. I believe it is not.

Mr. PECORA. It is not published in any report issued in behalf of the exchange or made to the exchange by any of its officers?

Mr. HARRIS. No, sir.

Mr. PECORA. I want to call your attention to the provisions of section 1 of article 6 of the constitution of the stock exchange, reading as follows:

It shall be the duty of the treasurer to receive, and, acting under instruc. tions from the finance committee, to take charge of and disburse moneys of the exchange. He shall report fully to the finance committee in regard thereto at its stated meetings. He shall present to the governing committee at its first regular meeting in January of each year a report of the finances of the


exchange for the 12 months ending December 31, preceding. He shall also present to the governing committee at its first regular meeting in January, April, July, and October, a report of finances of the exchange for the 3 months preceding.

Has it ever been the practice or rule of procedure or custom for the stock exchange to make public to its membership-not to the general public, but to its membership—a report of its finances; that is, of its income and operating expenses, and so forth, and disbursements ?

Mr. HARRIS. I believe not.

Mr. PECORA. Do you know any reason why that information is not given to the members of the exchange?

Mr. HARRIS. No, sir; but I think any member of the exchange could go to the president of the exchange and discuss it with him.

Mr. PECORA. Do you know any reason at all why it is not given to members of the exchange as a matter of routine?

Mr. HARRIS. I do not.

Mr. PECORA. As a member of the governing committee of the exchange, I assume that at the meeting that was held last month the treasurer, under the provisions of section 1 of article 6, reported or presented to it a report of the finances of the exchange for the 12 months ending December 31 last!

Mr. HARRIS. He did.
Mr. PECORA. Do you recall what that report showed !

Mr. Harris. I am sorry, Mr. Pecora. I haven't a good memory. I do not remember the figures.

Mr. PECORA. Can't you tell us what the figures were even approximately?

Mr. HARRIS. I am sorry. I would not want to guess at them.

Mr. PECORA. You heard the report only within the past month, didn't you?

Mr. HARRIS. I did.

Mr. PECORA. And didn't it make enough of an impression on you to cause you to recall now even approximately what the figures were?

Mr. HARRIS. No, sir; the figures appeared satisfactory, and I dismissed them from my mind.

Mr. PECORA. Just what consideration did you give them that made you to conclude they were satisfactory and cause you to disiniss them from your mind from that time on?

Mr. Harris. I mean by the term “satisfactory” it did not appear to me that the exchange was going to go bankrupt. As a consequence, they were satisfactory.

Mr. PECORA. Do you recall what was the amount of income reported by the treasurer?

Mr. HARRIS. No, sir; I do not.
Mr. PECORA. In the year 1933 ?
Mr. HARRIS. I cannot recall the figure.
Mr. PECORA. Can't you even aproximate?

Mr. HARRIS. I do not want to guess, Mr. Pecora, and I cannot do it.

Mr. PECORA. Was it several millions of dollars?
Mr. HARRIS. I cannot guess.

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