erms and conditions specified therein.

"(4) If any person acts in contravention of this regulation, or
if any person to whom a licence has been granted under this
regulation subject to any terms or conditions fails to comply with
these terms or conditions, he shall be guilty of a summary offence
against these regulations.

"(5) In this regulation the expression 'securities' includes
Bonds, Debentures, Debenture stock, and marketable securities."

It will be seen at once that the terms of this document, on any
interpretation of them, go far beyond the intentions expressed in what
may be called the official preamble and in the new Committee's terms
of reference. One of the clauses seems, with all deference to its
august composers, to be merely silly. This is (1)(c) forbidding
sub-division of securities. If a L10 share is split into ten _L1_
shares this operation cannot make the smallest difference to the
supply of capital for essential industries or cause any drain on the
Foreign Exchanges. I am assured by those who have delved into the
official intention that the reason for the objection of the old
Committee to splitting schemes, on which this new prohibition is
based, was that splitting made shares more marketable and popular and
so more likely to compete with War Bonds. But a mere sale of shares,
split small and so popularised, does not absorb any capital. That only
happens when, money is put into some new form of industry. If A, who
holds ten L20 shares, is enabled to dispose of them to B because they
are split into 200 L1 shares, then, A instead of B has got the money
and has to invest it in something. The amount of capital available for
investment is not diminished by a halfpenny. This regulation is just
a piece of short-sighted tyranny which exasperates without doing the
smallest good to anybody.

More serious, however, was clause (1)(e) under which any securities
that have been issued, split, consolidated or renewed without Treasury
sanction since January, 1915, were not to be dealt in, in future,
without a licence. The result of this clause, if it had stood, would
have been that all loans under which such securities had been
pledged would have had to be called in because the collateral became
unsaleable, except after all the ceremonies had been gone through
and a licence had been got. It was also possible to argue that the
prohibition to renew or extend the maturity of any securit