Short Sales

For a month rumors have seeped through Washington that certain people with advance information made a killing by selling air stocks short just before President Roosevelt ordered the domestic airmail contracts canceled. Last week President Richard Whitney of the New York Stock Exchange delivered to the Senate Banking & Currency Committee a long and miscellaneous list of 555 air-stock sellers. Politicians and the Press 'made a big to-do over the fact that J. P. Morgan & Co., than which no organization has at present less political pull, had sold 4,500 shares of United Aircraft fortnight before the Feb. 9 annulment order.

Morgan & Co. had been in a long position, but had had the misfortune to unload on Jan. 26, first day of the period under investigation. Nevertheless, the name of Morgan was enough to cloud the more significant revelation that during January the short position in seven leading air stocks increased from 4,000 to 44.000 shares. With that suspicious fact in view, Republican members of the Senate committee insisted that Inquisitor Ferdinand Pecora begin an independent investigation to learn through what, if any, member of the Democratic Administration a leak might have sprung.

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