The Birmingham age-herald., 1908-03-28
IMPORTANT CHANGES
 IN BANKING LAWS
Senator Johnston Gets His Amend ment Relating To Reserves Adopt ed as Part of the Bill, Which
 Now Goes to the House.

Washington, March 27-The Aldrich cur rency bill was passed by the Senate today by a vote of fl to 16-in the main party vote. Previous to the taking of the vote on the Aldrich bill, vote was taken on the Bailey substitute authorizing the government instead of the national banks to issue the emergency circulation for which the bill provides. The vote on the substitute stood 43 to 1S, and this vote was entirely partisan, even Senator La Toilette casting his vote with the re- publicans. The bill has been before the Senate since January 9. The vote was not reported until after o'clock.
 An interesting feature of the passage of the bill was a reiteraton by MT. AL drich of his promise to bring In bill Tor an investigation of the entire banking sys- tenn of the country with a view to insti- tuting reforms.
 As passed the bill provides for not more than $500 000.000 of emergency currency to be issued to national banks upon the de- posit by them of state. county and munl- cipal bonds, to be approved by the Sec retary of the Treasury. The currency is to be issued with a view of securing an equitable distribution of the currency over the United States, and in accordance with the unimpaired capital and surplus of banks in each state. Banks are to pay for this emergency circulation one- half of l per cent a month during the first four months it is circulated and afterward three-quarters of i per cent month.
 The bill provides that national banks shall pay not less than 1 per cent on gov- ernment funds deposited with them.
 Important Change.
 As amended today the bill carries an important change in banking laws relat- ing to bank reserves. This amendment provides that 15 per cent reserve required to be kept by banks not in reserve cities, four-ffths is to be kept in the vaults of the bank and of that amount one-third can be in the form of securities of the kind required
 By another amendment agreed to the one-haf of 1 per cent interest to ne charged was reduced from six to four months after which three-quarters of 1 per cent is to be charged until redeemed At the instance of MT. LaFollette an amendment was adopted prohibiting any national bank from investing it's funds in stocks or other securities of corpora tion, the officers or directors of which are officers or directors of the bank, and providing a penalty of imprisonment of from one to five years.
 The proposition to insert a provision for a government guarantee of deposits in na- 
 tional banks was defeated by a vote of 46 to H. An amendment by MT. LaFol- lette to punish by from one to five years' imprisonment any Justification in bank securities was adopted.
 BaIeys Bill Killed.
 Senator Teller offered on request of Senator Bailey of Texas, who was absent, the sub-currency bill of the senator from Texas which he stated was In the main to ba xyit ha f. ference that it provided for government instead of bank papers, and asked for a roll call. The vote was 42 to 13 against the bill
 When the vote was taken on the Ald- rich bill Senators Teller and Johnston. democrats, explained their reasons for voting for the measure. and Senator Overman his reason for opposing it. MT. Overman said in part
 sThe Aldrich bill does not get at the root of the trouble. but only administers to the diseased surface It is patch; 1t is d thin patch upon the crazy quilt of our monetary system. salt solution for use only when death is imminent or an emergency comes
 "What avail would this bill have been. what relief would it have been to the country banks in October last? The coun- try banks do not own state, county, rail- \ road or municipal bonds They only bear 8 or per cent interest and the banks cannot afford to own them when they can loan every dollar they have at 6 and per cent These bonds generally go to the great money centers and are helu py savings banks. insurance and trust com panies and the great national banks. It is a monstrous proposition to say that the banks would have taken $l00,000 ana more of currency from their vaults to purchase bonds and get in return only $75 900 to s9o.000 in high-taxed money.
 Vote In Detail.
 Following was the vote on the passage of the bill
 Yeas: Aldrich, Ankeny, Beveridge, Brandige, Burkett, Burham, Burrows Crane Cul1om, Curtis, Depew, Dick, Dill lingham, Dixon, Deliver, Dupont Elkins, Flint, Frye, Gallinger, Gamble, Guggen- heim Hopkins. Johnston (democrat, Keane, Knox, Lodge, Long, McCumber, Nelson, Owen (democrat, Perkins, Piles, Richardson, Smith of Michigan; Scoot' Stevenson, Southerland, Teller (demo- craD Warner, Warren and ~Wetmore. ATotal, 42.
 Nays: Bankhead, Borah Tepublican). Bourne (republican), Brown Gepublican), fulberson, Frazier, Gary. Gore. Hepburn hs,blcan). LaFollette Republican,, Me- kIiy, McEnery, McLaurin, Overman, Iy ter and Taylor. Total, 16. " Owing is the text of important
 dments to the bill which were adopt
 day:
 Johnston's Amendment.
 Johnston of Alabama: That after .nuary l. 1909, national banking asso- aations located outside of reserve or |central reserve cities which are now re- quired by law to keep a reserve equal to IS per cent of their deposit liabilities, shall hereafter hold in their own vaults four l ffths of such reserves, either in lawful |  securities enumerated in section of this l