Wood County reporter. [volume] (Grand Rapids [i.e. Wisconsin Rapids], Wis.) 1857-1923, 1922-08-10

1
ether states. He is an authority De
yond dispute on this topic.
In an opinion upholding the Illinois
Securities Act, the State Supreme
Court very aplty describes "blue sky
securities as those issued 'tfor the pur-
pose of developing wild cat oil fields
IN distant states, mythical rubber
plantations in Guatemala or imagi-
nary copper mines in Mexico;for ex-
tracing gold from sea water or light
from cucumbers, developing power
from the rise and fall of the tides or
for the hundreds of visionary schemes
designed to secure great returns from
small investment in short time -
Only in recent years has there been
any effective effort to curb what the
court terms sleek, peripatetic sales
men with glib tongues and indurated
consciences."
Kansas enacted the first law of this
kind in 1911 and it's operation was
watched with interest by other states.
This act has been greatly improved
upon and more than three-fourths of
the states have adopted measures for
the regulation of the sale of securi-
ties.
We are<now preparing to go a step
farther.
Federal Law Needed.
It has been found that in the alb
sence of a federal statute denying the
use of the mails in interstate COM
merce for the sale of unqualified or
worthless securities the effectiveness
of the state laws has been greatly
handicapped. Companies offering for
sale some of the very worst securi-
ties, who are unable or unwilling to
meet the requirements of the state
laws, offer their paper for sale
through the mail from some point at
a distance and there is no effective
way to prevent it.
To remedy this condition, bill has
been presented in Congress by Con
gresham Denison of Illinois. This
bill has the support of the National
Association of Securities Commission
ers, the American Bankers Associa-
ton and the National Association of
Investment Bankers. 1t follows the
plan adopted in most of the state
laws, classifying securities for pur-
poses of commerce between the
states.
Invariably, it is the small investor
who becomes the victim of the "blue
sky" salesman. What he loses often
ruins him financially. His inexperi-
ence in investments makes him an
easy prey.
Of course, the inexperienced inves-
tor should be wise enough to take the
advice of his banker before buying
any securities, but too often he is in
fuenced by stories of fortunes made
by taking a chance The arguments
of the salesman are plausible and ne
takes the risk in the hope of great re-
turns.
Suckers Are Born.
It is impossible to cure the sucker.
He is born that way. He needs all
of the protection the law can give him.
That is the purpose of all ''blue sky"
legislation.
Illinois, after experimenting with
law adopted in 1917, has now an
amended act which has been accepted
in principle by many other states and
which is proving as satisfactory as
any securities legislation yet worked
out. The trouble with the original
law adopted in this state was that it
provided for the issuance of a certifi-
cate by the Secretary of State to the
corporation which met the require
ments. This certificate bore the great
seal Of state. In the hands of an I'M
Ions doc lor cponf If yIyac vary