Evening times-Republican. [volume] (Marshalltown, Iowa) 1890-1923, 1908-01-01
Governor Of New York Makes
Strong Plea For Protection
in Annual Message
PRACTICES
REPREHENsIBLE
Says Laws Should Prevent Formation
Of Subsidiary Companies to speeu-
late With Capital Of Parent Con-
cerns-Trust Companies Should Be
Included = Other Recommendations.

Albany, N. Y, Jan. 1.-GoVernor
Hughes message to the legislature,
which opened here today. contains
many important recommendations.
Chief among these is the recommenda-
tion regarding an amendment to the
law relating to banks and trust COM
panies. The governor urges the leg
islators to adopt every precept,ple
means to prevent a repetition OF tne
reprehensible practices disclosed DUR
ing the recent financial upheaval ana
To assure proper management of finan-
cial institutions chartered and super
yised by the state, upon whose stapili-
ty and prosperity the interests OF peo-
pie of every walk Of life so largely de-
pend.
Other recommendations are for com
plete suppression of race track Sanp
ling: direct nominations at the pri-
maries; simplitied form of ballots;
better provision for the care and pro-
lection of emigrants; extension of the
states holdings of forest reserves and
a revision Of forest, fish, and game
laws; and a reasonable fee for hunt
ing.
Points to Recent Lessons.
With reference to the banking laws,
the governor says:
Recent events have demonstrated
the necessity for providing effective
means for preventing the exploitation
Of banks and trust companies and the
acquisition and use of control OF
number Of institutions to facilitate
selfish schemes opposed to sound bank
ing. If suitable restrictions in explicit
form and with appropriate penalties.
ensuring adequate knowledge and
proper attention on the part Of direc-
tors with regard to loans and other
transactions; preventing deposits Oh
the monies of one institution with an
other in order that the officers, dfrec-
tors and stockholders Of the former
may obtain desired credits from the
latter; limiting the amount which may
be loaned by any hank or trust COM
pany upon the stock of another finan-
cial institution; reducing the amount
which may be loaned upon collateraI
to any one interest; erecting proper
safeguards against loans and invest
ments in aid of schemes of promotion
represented by unmarketable securi-
ties, and if, in addition, suitable means
are provided for enforcement of rulings
of the superintendents of banks with
wi fo i,,,n rnCQfn
tices, the security of our financial in
stitutions and the confidence which
springs from just reliance upon their
proper management, will be greatly
strengthened. 1t is apparent that the
existence of demand obligations re-
quires that reserves to be maintained
so that they have saiutary tendency to
prevent undue expansion Of credits.
Trust Companies Too.
With regard to trust companies,
however the matter of reserves is a
phase of larger question. 1t was not
contemplated by the law relating to
trust companies that they should en-
gage in business as banks. In prac-
tice, however, they have engaged in
the banking business upon a large
scale and monies deposited with them
are for the most part payable on de-
mand Whatever reserves or other re-
strictions may be deemed advisable
with reference to demand deposits in
case of banks should be equally obli-
gatory with reference to the same sort
of deposits in care of the trust COM
panies."
Extreme caution in making any
changes in the present insurance law
is urged, and enlargement of the
scope Of the public service commits
sion law so as to include telephone
and telegraph companies, which would
bring them under regulation as to
rates, service and other matters sim
liar to that which obtains in the case
of corporations at present subject to
law, is recommended.
James W. Wadsworth. Jr.. was re-
elected speaker of the as sembly.