Joseph Kennedy's Enduring Example

By Mike Brewster

Early in 1934, as Congress worked on the legislation that would create the SEC, New York Stock Exchange President Richard Whitney proclaimed the exchange "a perfect institution" -- and rejected the idea that the government should regulate the securities business. After passage of the Securities Exchange Act in 1934, Whitney, among others, proposed that financial institutions show their displeasure with the new law and its companion legislation, the Securities Act of 1933, by shutting down temporarily. Many leaders of Corporate America openly threatened to ignore the rules laid down by the new commission.

CONFIDENCE GAME. In his first major public speech on the issue, at the National Press Club on July 25, 1934, Kennedy tried to reassure the old guard. "Everybody says that what business needs is confidence," Kennedy said. "I agree. Confidence that if business does the right thing, it will be protected and given a chance to live, make profits, and grow, helping itself and helping the country. The rules are simple and honest. Only those who see things crookedly will find them harsh."

Kennedy's measured approach helped calm the situation. "I

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