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Securities Act of 1933
Facts for kids
The following fact
sheet contains interesting facts and information on the
purpose, effects and significance of the Securities Act of 1933
as part of FDR's New Deal to combat the effects of the Great
Depression.
Facts
about the Securities Act of 1933 for kids
Securities Act of 1933 Fact 1:
Definition of Securities: Securities
are tradable financial assets such as bonds, options and
shares (stocks) that are bought and sold in financial
markets by traders.
Securities Act of 1933 Fact
2: Definition of Stocks and Shares:
Stocks are shares of ownership of a public corporation
that are sold to investors through broker dealers.
Shares are the equal portions into which the capital
stock of a corporation is divided and ownership of which
is evidenced by a stock certificate
Securities Act of 1933 Fact 3:
The purpose of the Securities Act of 1933 required
companies that sold bonds and stocks to provide full and truthful
information to investors.
Securities Act of 1933 Fact 4:
Before the law was passed the regulation of
securities was chiefly governed by state laws, commonly referred to
as "Blue Sky Laws"
Securities Act of 1933 Fact 5:
The term "Blue Sky" was a phrase used by Supreme
Court Justice McKenna to characterize speculative schemes "which
have no more basis than so many feet of blue sky" and used in
reference to the belief that Stock Market that investors had been
misled by exaggerated claims and inadequate disclosure of the true
financial position of corporations.
Securities Act of 1933 Fact 6:
Definition of "Blue Sky Laws": The
"Blue Sky Laws" were passed by individual states to
regulate the sale of securities (Stocks and Shares) and
to prevent unscrupulous sales agents from promising
unrealistic returns and misinforming investors about the
investment risks. Between 1911 and 1933, 47 states
adopted blue-sky laws, Nevada was the only exception
Securities Act of 1933 Fact 7:
The 1933 Securities law was the first
major federal legislation to regulate the offer and sale
of securities. The "Blue Sky Laws" of the individual
states were left in place.
Securities Act of 1933 Fact
8: The law aspired to "provide full and
fair disclosure of the character of securities sold in
interstate commerce" and fixed penalties against anyone
failing to make full disclosure
Facts
about the Securities Act of 1933 for kids
Facts
about the Securities Act of 1933 for kids
The following fact
sheet continues with facts about Securities Act of 1933.
Facts
about the Securities Act of 1933 for kids
The '33
Act Fact 9: The legislation was drafted by Thomas
Corcoran, Benjamin V. Cohen, and James M. Landis and
signed into law by President Franklin D. Roosevelt on
May 27, 1933.
The '33 Act Fact
10: The law responded to the belief that
the lack of information and exaggerated claims had
encouraged speculative purchases of stock, which fueled
the 1929 Wall Street Crash.
The '33 Act Fact 11:
The bill had three major goals:
● To implement registration requirements
for companies wishing to sell securities
● To allow time for investors to study
the registration statement (a 20 day cooling off period) and
give the buyer power
● To sue for losses due to "misleading"
statements or "omissions of fact"
The '33 Act Fact 12:
The establishment of the Registration process was
the key factor to accomplish the goals of the new federal law. The
registration of securities was required containing facts about the
securities and the company issuing to enable investors to make
informed judgments about whether to purchase a company's securities.
The information required for the registration of securities
included:
● A description of the security being
offered for sale
● A description of the company, its
business and properties together with financial statements
certified by independent accountants
The '33 Act Fact 13:
Congress later created an independent government
agency called the
U.S. Securities and Exchange Commission (SEC) on June 6, 1934 to
enforce federal securities laws to regulate the Stock Market and
prevent fraud
Facts
about the Securities Act of 1933 for kids
Securities Act of 1933 - President Franklin Roosevelt Video
The article on the Securities Act of 1933 provides detailed facts and a summary of one of the important events during his presidential term in office. The following
Franklin Roosevelt video will
give you additional important facts and dates about the political events experienced by the 32nd American President whose presidency spanned from March 4, 1933 to April 12, 1945.
Securities Act of 1933
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Interesting Facts about Securities Act of 1933 for kids and schools
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Summary of the Securities Act of 1933 in US history
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The '33 Act of important, key
events
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Franklin Roosevelt
Presidency from March 4, 1933 to April 12, 1945
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Fast, fun facts about the '33 Act
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Foreign & Domestic
policies of President Franklin Roosevelt
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Franklin Roosevelt Presidency and
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