. Legislative regulation of railway finance in England . forms ofstock watering, unhappily so common in practicallyunknown in If at all, stock-watering must be doneopenly. It must be sanctioned by Parliament. Such publicityremoves much of the temptation to effect stock-watering for dishon-est purposes. Moreover, the indirect checks imposed by the StampActs have made stock-watering almost impossible. Let stock-wat-ering be done openly and be investigated first by some dignifiedgovernment office, it will disappear on its own account. There-fore, stock-watering in England,
. Legislative regulation of railway finance in England . forms ofstock watering, unhappily so common in practicallyunknown in If at all, stock-watering must be doneopenly. It must be sanctioned by Parliament. Such publicityremoves much of the temptation to effect stock-watering for dishon-est purposes. Moreover, the indirect checks imposed by the StampActs have made stock-watering almost impossible. Let stock-wat-ering be done openly and be investigated first by some dignifiedgovernment office, it will disappear on its own account. There-fore, stock-watering in England, extensive as it is, has neverbeen nearly as objectionable as in some other countries. More-over, the English railways seem to have seldom, if ever, wateredtheir stocks for dishonest purposes. On the other hand, theyappear to have been eager to help the government to prevent thedifficulties inherent in stock-watering. Hence a request of theBoard of Trade has been sufficient to secure full information re-1. Hadley, Railroad Transportation, 1903, p. garding their nominal additions made each year. Thus by turning tothe annual Railway Returns of the Board of Trade, one may see ata glance what proportion of the capitalization of each companyrepresents water. This difference partially explains why Par-liament has taken such lenient measures in regulating it. Thus, it appears publicity is one of the most effective andpracticable checks against objectionable stock-watering in railwayfinance. To insure this, railway companies should be compelled toshow in their accounts and balance-sheets all their nominal addi-tions. They also should be required to furnish periodic and duestatements exhibiting clearly such nominal additions as disting-uished from the actual capital, with remarks as to the time when,and circumstances under which, the additions were made. A uniformnomenclature should be marked on the certificates of all adulter-ated stocks so as to avoid confusion. It further appear
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