The Topeka state journal. [volume] (Topeka, Kansas) 1892-1980, 1919-01-27
Wayman of EmpOria Leads
Fight Against Bank Measure.
Says 1t Would Wipe Out Entire
Sight Exchange of Kansas.
CREATE AUTOCRATIC MACHINE
Asserts 1t Would Give Bank
Commissioner Political Power.
Seeks a Modification of Present
Federal Reserve System.

VIII Wayman of Emporia, one of
the most widely known state bankers
IN Kansas, is after the proposed state
reserve bank law with a meat AK.
Wayman, who vas for several sessions
a member of the legislature from Lyon
county, declares the theory of the pro-
posed new state legislation is a fallacy
and snare and a delusion.
A modification of the present fed
eral reserve act is needed, Wayman
declares. rather than a program which
provides that the state of Kansas seek
to live entirely within herself Such a
program, the Emporia banker states
would relieve conditions and overcome
many objections which are now being
lodged against the plan for the state
to engage in the banking business.
Wipe Out Sight Exchange"
Wayman, in a letter to the executive
committee of the State Bankers asso-
citation, asserts that the redepositing
feature of such value to the favorite
banks would soon wipe out the entire
sight exchange of all Kansas state
banks. The real argument for the bill,
it is declared by Wayman, is the op-
portunity for the state bank COM
missioner to build up an autocratic
political machine thru the power to
use the bank of Kansas in redepositing
and granting attractive rediscount
rates to the members belonging to his
political machine"
The letter which Wayman sent to
the State Bankers association will be
distributed to members of the legisla-
ture. In his letter the Emporia bank
er says in part:
The Wayman Letter.
The theory that a state live within
itself is. L believe, a fallacy either in
regard to its finance or in any other
line Of endeavor. Keeping Kansas money
in Kansas sounds good, but l doubt If
the total deposits in Kansas banks amount
of 70
mortgages in force against Kansas farms.
l have always hoped that the federal
that it will be modified so that the ma
jority of the state banks could avail them
selves of it and If the bank of Kansas is
instituted per the enclosed bill, it
will be further stumbling block separat-
ing the state banks from the federal sys-
tenn. 1 can't see that the bank of Kan
sas would link us to the federal system
for the reason that the bank of Kansas
it at the federal reserve bank even if
they were members of same.
AS soon as the funds of the bank of Kan
would have no place to turn for credit, as
the institution of this bank would force
its members to take their deposits away
from their present correspondents and de-
strOy the credit facilities which they have
been years in building up. 1t would be
perhaps but short time until the funds
of the bank of Kansas would be exhausted
for the reason that large portion of the
| deposits would be redeposited with its
these members in turn would thereupon
initiate their loans to exhaust their former
sight exchange thus redeposited with them.
then when the state reserve bank wanted
to this deposit, the only way the mem
Der bank could pay it would be to settle
| it with note which would not help out
the state reserve bank unless they could
sell the note to the federal reserve bank,
which would be impossible.
This redepositing feature while of great
value to the favored member bank. would
soon wipe out the entire sight exchange of
all of the Kansas state banks by the opera
ton described above. The proposed bill
would also permit the bank commissioner
to build up an autocratic political machine
thru his power to use the bank of Kansas
in redepositing and granting attractive
rediscount rates to the members belonging
to his political machine.
Section 10 excludes all rediscounts
without recourse except real estate
| mortgages, and as the moving of our re-
serve from Kansas City to the proposed
bank will destroy our credit at Kansas
City, then we will have to turn over several
of our best customers to our national bank
competitors.
..- Yours truly.