Before we go on to consider the new regulation, 30 F, let us try to see what is the real effect of the document above quoted.  It was evidently intended to be a relaxation of the control of finance.  This is shown by the sentence which says that the matter was to be reconsidered “in order that no avoidable obstacle may be placed in the way of providing the capital necessary for the speedy restoration of commerce and industry, and the development of public utility services.”  And yet it was thought necessary to give legal force and attach penalties to regulations that have worked during the war quite sufficiently well to secure a much stricter control than is now required.  The explanation of this apparent inconsistency is probably to be found in the desire of the Government to meet a grievance of the Stock Exchange.  Hitherto the only penalty that befell those who made a new issue without getting Treasury sanction was that the securities issued could not be dealt in on the Stock Exchange.  The practical effect of this was that those who acted without Treasury sanction could only issue securities subject to this serious drawback, and so an effective but not altogether prohibitive bar was put on the process.  If this bar was not strong enough in war-time it ought clearly to have been strengthened long ago; if it was strong enough, then why should it be strengthened now?

From the Stock Exchange point of view it is easy to make out a good case for working through licence and penalty rather than through the banning, of the securities effected, from sanction for dealings.  By thus being used as an official weapon the Stock Exchange penalised itself and its members.  By saying “no security not sanctioned by the Treasury shall be dealt in here,” its Committee restricted business in the House and drove it outside.  This grievance was obvious and was plentifully commented on during the war.  If the Committee had pressed the point vigorously it could probably have forced the Government long ago to abolish the grievance by making all dealings in new issues that appeared without Treasury sanction illegal and liable to penalty.  A patriotic readiness to fall in with the Government’s desires was probably the reason why the Stock Exchange refrained from embarrassing it, during the war, by too active protests against a grievance that was then more or less real; though it should be noted that even if the grievance had been amended, the Stock Exchange would not necessarily have got any more business, but would only have succeeded in stopping a very moderate amount of business that was being done by outsiders.  But when all is said that can be said for the justice of the case that can be made by the Stock Exchange, the question still arises whether it was advisable, at a time when relaxation of restrictions was desirable in the interests of the revival of industry, to draw tighter bonds which had been found tight enough to do their work.  That the Stock Exchange should