Full text of Minutes of the Board of Governors of the Federal Reserve System : Meeting Minutes, December 18, 1918, Volume 5, Part 4

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At a meeting of the Federal Reserve Board, held
in the office of the Board on December 18, 1918, at 11 A.M.,
PRESENT: The
Mr.
Mr.
Mr.
Mr.

Governor
Strauss
Hardin
Miller
Broderick, Secretary.

The minutes of the meetings of the Board held on
December 13th and 16th were read, and on motion approved as
amended.
The minutes of the meetings of the Gold Export Committee, held on December 17th and 18th, were presented and
approved, and the action therein set forth ratified.
Morning business was presented and disposed of as
.follows:
The Governor reported that on yesterday the Chairman
of the Banking and Currency Committee of the House had introduced in the House a bill to amend the Federal Reserve Act
in certain respects.
Letter dated December 16th, from the Chairman of the
Federal Reserve Bank of Richmond, submitting recommendations
for increases in salaries of officers and employees of that
Bank for the year 1919.
Approved.
Letter dated December 16th, from Chairman of the Federal Reserve Bank of New York, requesting correction of in-




crease in salary of 17.r. Hendricks, Cashier of that Bank,
to make such increase

2,000 instead of ',4,500.

ilpproved.
Telegram dated December 17th, from Chairman of
the Board, Federal Reserve Bank of Boston, recommending
horizontal increase of 10,] in the salaries of clerks in
view of the Board's action in disapproving prior commitments
for bonuses in 1919.
Voted to reconsider the action of the
Board of December 16th, approving increases
for 1919 in salaries of officers and employees of the Federal Reserve Bank of
Boston.
Voted to approve salary increases
heretofore approved for officers on the
basis submitted "without bonus".
Voted further that the Chairman of
the Board of the Boston Bank be informed
that the Board is unwilling to approve horizontal increase in salaries of clerks recommended by his Board, believing such action
unnecessary in order to retain certain individual members of the Bank staff, and that
the Board requests the Federal Reserve Bank
of Boston to submit a revised list of recommendations of salaries of anployees with such
individual changes in previous recommendations as the Bank may see fit to make.
Letter dated December 1th, from the Chairman of
the Board of the Federal Reserve Bank of Dallas, recommending approval of salaries of Federal Reserve Lxaminers at
that Bank, as follows:




fi_530

-3R. E. Chambers,
J. H. Blocker,

$3,000 per annum
2,500

Approved.
The Secretary presented report of estimated expenses of the Federal Reserve Board for the period January
1 to June 30, 1919.
Voted that it shall be the future
policy of the Federal Reserve Board, in
levying assessments upon Federal Reserve
Banks for the expenses of the Board, to
adopt as the basis of such assessments the
paid in capital and the surplus rather than
the authorized capital and the surplus of
Federal Reserve Banks.
On motion duly seconded, the following
resolution was adopted:
WHEREAS, under Section 10 of the Act approved December 23, 1913, and known as the Federal Reserve Act, the
Federal Reserve Board is empowered to levy semi-annually
upon the Federal Reserve Banks in proportion to their capital stock and surplus an assessment sufficient to pay its
estimated expenses, including the salaries of its members,
assistants, attorneys, experts, and employees for the half
year succeeding the levying of such assessment, together
with any deficit carried forward from the preceding half
year; and
WHEREAS, it appears from estimates submitted and
considered that it is necessary that a fund equal to two
hundred ninety six thousandths (.00296) of one per cent
of the paid in capital stock and surpluz of the Federal
Reserve Banks be created for the purpose hereinbefore described, exclusive of the cost of engraving and printing
of Federal Reserve notes; sow, therefore,
BE IT RESOLVED, That pursuant to the authority
vested in it by law, the Federal Reserve Board hereby
levies an assessment upon the several Federal Reserve
Banks of an amount equal to two hundred ninety six
thousandths (.00296) of one per cent of the total paid in




capital stock and surplus of such banks, and the Fiscal
Agent of the Board is hereby authorized to collect from
said banks such assessment and execute, in the name of
the Board receipts for payments made. Such assessment
will be collected in two installments of one-half each;
the first installment to be paid on January 1, 1919, and
the second half on March 1, 1919.
The Governor reported the following rediscount
transactions pursuant to authority heretofore vested in him:
December 17th, by Federal Reserve Bank
Chicago
for Federal Reserve Bank of Dallas,
of
*5,000,000 member bank 15 day notes; Government security, rate 4%.
December 17th, by Federal Reserve Bank
for Federal Reserve Bank of
Minneapolis
of
Philadelphia, *10,000,000 customers' paper,
30-60 days; Government security, rate 4-eo.
December 17th, by Federal Reserve Bank
of Chicago for Federal Reserve Bank of Atlanta, $5,000,000 15 day member bank promis0.
sory notes; Government security, rate 4/1
Noted.
The Governor reported the purchase of the following
special 2/0 certificates of indebtedness of the United States
for deposit with the Comptroller of the Currency as collateral for Federal Reserve Bank notes:
For Federal Reserve Bank of:




Boston,
Cleveland,
Atlanta,
Chicago,
New :York,
Dallas,
Kansas City,
Approved.

Date
Dec.16,1918

Amount

*1,000,000
1,000,000
Dec.17,1918
500,000
2,000,000
tt
2,000,000
1,000,000
1,000,000

-5Memorandum by Secretary dated December 17th,
recommending a call for reports of condition of member
banks, other than National Banks, simultaneously with and
as of the same date as the Comptroller's last call for
the present calendar year.,
Approved.
Letter dated December 14th, from Chairman of the
Federal Reserve Bank of Atlanta, asking approval of the
payment by that Bank of a dividend of 3;"; as of December 31,
1918.
Approved.
Proposed letter to all Federal Reserve Agents and
Federal Reserve Banks, dated December 17th, in re treatment of reserves against deposits and note liabilities of
Federal Reserve Banks.
Approved as amended.
Telegram dated December 16th, from the Chairman
of the Federal Reserve Bank of Atlanta, requesting approval
of lease of quarters in the Heard National Bank Building
for the Jacksonville Branch of the Federal Reserve Bank of
Atlanta.




Referred to Governor with power.
Letter dated December 13th .from Mr. Alva Adams, a

-6director of the Denver Branch of the Federal Reserve Bank
of Kansas City.
On motion, duly seconded, it was voted
to reelect Messrs. Alva Adams and John Evans,
directors of the Denver Branch of the Federal
Reserve Bank of Kansas City, for the calendar
year 1919.
Memorandum by Comptroller of the Currency dated December 13th, recommending approval of the application of
the Mount Jewett National Bank, Mount Jewett, Pa., for permission to reduce its capital stock from $60,000 to $30,000,
with the understanding that a surplus of not less than
415,000 shall be maintained.
Approved.
REPORT OF COMMITTEE NO. 1:
Dated December 17th, recommending admission of State institutions as set forth in the auxiliary minute book as of this date,
subject to the conditions stated in
the individual reports attached to
each application.
Approved.
Dated December 17th, recommending approval of the application of John A. Garver of New York
City, for permission to serve at the
same time as Director of the Citizens
National Bank, the National City Bank,
and New York Trust Company, all of
New York.
Approved.
Dated December 17th, recommending changes in stock at
Federal Reserve Banks as set forth
in the auxiliary minute book as of
this date.
Approved.




-7CHANGES IN STAFF:
Dated December 14th, recommending approval of salary of
$5,000 per annum, effective December
15th, for M. W. Bell, Cashier of the
Federal Reserve Bank of Atlanta.
Referred to Executive Committee
with power.
Dated December 16th, recommending appointment of W. H.
Toole as Manager, Fiscal Agent Department, Federal Reserve Bank of
Atlanta, effective December 15th, at
a salary of $4,500 per annum.
Referred to Executive Committee
with power.
Dated December 14th, recommending increase in salary of
Richard L. Hargreaves, National Bank
Examiner, Federal Reserve District
No. 5, from $3,000 to $3,600 per annum,
effective January 1, 1919.
Approved.
Dated December 13th, recommending increase in salary of
George J. Stevens, National Bank Examiner, Federal Reserve District No.
4, from $3,600 to c3,900 per annum,
effective January 1, 1919.
Approved.
Dated December 17th, recommending increase in salary of
Secretary ZoLallen of the Federal Reserve Bank of Chicago, from $3,000
to $3,500 per annum, effective January
1, 1919.
Approved.
Other business was presented and disposed of as
follows:
Letter dated December 13th from Hon. R. C. Leffingwell,
Assistant Secretary of the Treasury, reporting deposit with




-6Federal Reserve Banks of gold accumulated through the
use of Federal Reserve notes by Treasury officers in making
current disbursements.
Noted.
Telegram dated December 15th, from Assistant Federal
Reserve Agent Elliott of San Francisco, requesting authority
to reduce from 4% to 4% the discount rate on member bank
15 day notes secured by Government obligations.
Referred to Governor for further information as
to reasons for asking reduction in rate.
At 12:45 P.M., the meeting adjourned.

Approved: