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The Papers of Charles Hamlin (mss24661)
367_07_001-
Hamlin, Charles S., Scrap Book — Volume 241, FRBoard Members
205.001 - Hamlin Charles S
Scrap Book - Volume 241
FRBoard Members
411
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Office Correspondence
To
The Files
From
Mr. Coe
Dee
Au,,,_aist 11, Twit
Subject:
After correspondence with Mrs. Hamlin (see letters of May
25 and June 4, 1941) the items attached hereto and listed below, because of their possible confidential character, were taken from Volume 241 of Mr. Hamlin's scrap book and placed in the Board's files:
VOLUME 241
Page ,2
Memo to Mr. Hamlin from Mr. Goldenweiser re withdrawals of gold
coin.
Page 13
(X-7425) Indebtedness of Officers and Employees.
Page 31
Memo to Mr. Morrill from Mr. Van Fossen re Direct Loans to Individuals, etc.
Page 37
Memo to Mr. Hamlin from Mr. Goldenweiser re Lippmann's article
in Tribune, May 21 1933.
Page 46
Memo to Mr. Hamlin from Mr. Smead re amount of gold and gold certificates received by F.R. Banks.
Page 47
Memo to Mr. Hamlin from Mr. Goldenweiser re interest rates paid
by small borrowers.
Page 61
Memo to Mr. Hamlin from Mr. Smead re possible expansion in Federal
Reserve note circulation.
Page 81
Denominations of paper currency in circulation. (Marked not for
publication)
Page 87
Earnings and Expenses of F.R. Banks, April 1933.
Form No. 131
Qffice Correspontence
To_
From
FEDERAL RESERVE
BOARD
•
Date
May .24_ 1933
Subject:
__
Mr- rroldenuel:
Vie
In re-oly to your memorandum of April 26, it would appear that
5
after October,.0 1932, the return of gold coin from hoards, which had
been in progress from mid—summer, ceased and there was some retarda—
tion in the rate of rr-turn of other forms of currency to the reserve
banks, after allowance for the usual seasonal demands of October and
November.
These developments were subsecuent to Mr. Hoover's Des
Moines speech, which was delivered on October 4, 1932.
Withdrawals of gold coin in October were small, but in November
were of considerably more than seasonal proportions, notwithstanding
the fact that the demand for other forms of currency was of smaller
than seasonal proportions and we were receivinz large quantities of
gold from abroad.
The data are shown onoCharts I and II attacl,ed.
Chart I shows
weekly fluctuations in demand for currency after allowance for seas—
onal variation during the period from October, 1930 to date.
Chart
II shows the amount of gold coin and gold certificates in circulation
as of the close of each month from January, 1929 to date and as of
each
ednesda:,- from August 31, 1932 to date.
the attached tables.
VOLUME 241
PAGE 5
The data are shown in
2-8495
MONEY 17 OIRMATIOU-ADJUSTED FOR SEASONAL VARIATIGUS-WET2ESDAY SERIES
(In millions of dollars)
0•••••••
Date
(Wednesday)
Amount
Date
(Wednesday)
Amount
Date
(Wednesday)
.Amount
1930
Oct. 1
8
15
22
29
4,432
4,420
4,418
4,402
4,380
June 3
10
17
24
4,708
4,784
4,828
4,813
1932
Jan. 6
13
20
27
5,562
5,649
5,680
5,689
Nov. 5
12
19
26
4,396
4,394
4,423
4,452
July 1
8
15
22
29
4,849
4,848
4,865
4,881
4,862
Feb. 3
10
17
24
5,716
5,694
5,689
5,633
Dec. 3
10
17
24.
31
4,498
4,510
4,627
4,672
4,699
Mar.
5
12
19
26
4,904
4,936
4,992
5,022
2
9
16
23
30
5,613
5,594
5,580
5,530
5,492
Apr.
6
13
20
27
5,487
5,459
5,478
5,466
1931
Jan. 7
14
21
28
Feb. 4
11
18
25
4,707
4,679
4,668
4,645
4,662
4,651
4,642
4,615
Aug.
Sept. 25,038
I.
9
5,035
16
5,065
23
5,147
II
30
5,197
Apr. 1
8
15
22
29
May 6
13
20
27
4,640
4,647
4,662
4,671
4,676
4,713
4,697
4,719
4,594
5,495
5,496
5,524
5,488
5,452
5,438
414
5,I
5,368
Junel
8
15
22
II29
5,460
5,511
5,544
5,592
5,700
5,403
5,356
5,381
5,392
5,436
July 6
13
20
27
5,742
5,761
5,814
5,779
Aug. 3
10
17
24
31
5,783
5,755
5,746
5,720
5,703
7
14
21
28
5,365
5,391
5,457
5,436
Nov.
4
11
18
25
Dec.
2
9
16
23
III
30
5
1
5
ii
i
May 4
11
18
25
Oct.
'?age 2
Money in Circulation-Adjusted for Seasonal Variations-.Viednesday Series
(Continued)
Date
(;ednesday)
Amount
Sept. 7
14
21
28
5,656
5,640
5,622
5,571
Oct.
5
12
19
26
5,583
5,558
5,561
5,539
rov.
2
9
16
23
30
5,541
5,556
5,567
5,537
5,555
Dec.
7
14
21
28
5,515
5,476
5,443
5,410
1933
Jan. 4
11
18
25
5,525
5,594
5,667
5,711
Feb.
1
15
22
5,740
5,787
5,922
6,018
Mar.
1
8
15
22
29
6,752
7,582
7,323
6,668
6,412
Apr.
5
12
19
26
6,289
6,175
6,117
6,067
GOLD COIN AND GOLD CERTIFICATES IN CIRCULATION
(In millions of dollars)
End of month
Gold
coin
January
February
March
April
May
June
July
August
September
October
November
December
AII
361
378
374
372
370
368
366
365
364
363
364
384
Preliminary
1929
Gold
certi- Total
ficats
923 1,304
935 1,313
937 1,311
906 1,278
9414 1,314
935 1,303
888 1,254
687 1,252
850 1,214
846 1,209
889 1,253
880 1,264
Gold
.
coin
1930
Gold
certi- Total
ficez-s
Gold
coin
369
365
362
360
359
357
356
353
352
350
351
368
799 1,168
841 1,205
873 1,235
886 1,246
954 1,313
995 1,352
1,002 1,358
1,051 1 4o4
1,026 1,378
1,020 1,370
1,076 1,427
1,118 1,486
358
356
354
352
353
363
363
363
376
387
383
409
1931
Gold
certi- Total
ficates
1,056
1,061
1,o47
1,035
1,020
997
976
989
1,037
972
928
877
1,414
1,417
1,4ol
1,387
1,373
1,360
1,339
1,352
1,413
1,359
1,311
1,266
'Gold
coin
407
4o6
ho4
411
435
453
.1454
449
445
445
454
468
1932
Gold
certi- Total
ficates
850
820
779
758
735
716
694
669
644
624
635
6ol
1,257
1,226
1,183
1,169
1,170
1,169
1,148
1,118
1,089
1,069
1,089
1,069
Gola
.
coin
479
571
2/367
1933
Gold
certi- Total
ficalx:s
591 1,070
649 1,220
D/393 1/760
411
4PD
GOLD COIN
Gold coin
Gold
Certificates
31
449
669
1,118
7
14
445
447
446
665
658
651
1,113
1,105
1,097
445
645
1,090
Wednesday series
1932—August
September
21
28
October
November
December
1933--January
February
March
April
GOLD CERTIFICATES IN CIRCULATION
(In millions of dollars)
1.
Total
5
444
641
1,085
12
19
445
445
635
630
1,080
1,075
26
446
624
1,070
2
445
622
1,067
9
16
23
30
447
449
452
455
619
618
621
635
1,066
1,067
1,073
1,090
7
14
458
464
610
608
1,068
1,072
21
28
471
470
605
601
1,076
1,071
4
11
468
468
18
470
25
475
598
594
593
589
1,066
1,062
1,063
1,064
1
O
591
589
596
599
1,075
1,083
1,115
654
726
1,240
1,346
15
43o
146
487
21
516
1
g
15
22
29
586
620
462
333
368
557
1,019
451
403
834
771
5
365
359
353
3142
379
368
354
338
7144
727
707
6so
12
19
26
1,071
e,
•
•
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ASSA 'F1.4LISETTS
CHART II
GOLD COIN AND CERTIFICATES Ii CIRCULATION
(In millions of dollars)
16oo
11600
-1
1
1
1500
H1500
1400
.1400
Total
1300
-1300
1200
1
I 00
1100
110T
A
1000
/
1000
Gold./1
7/ertifi
cates
/"*.‘
900
900
soo
600
S.
7
I
i
it
Gold
_
600
/
.600
Certific—p7:-.
500
500
Gold Coin
Coin
S.
4co
1ttrJ
tj 2
A
1 _1
L
--1
7
1-7
300
Litt
2'00.
tr----
1930
1931
1932-
- 1933
31”158
-7 "
Rug
5,1- 14
"
5ePt OC-f
212-8 4"18
'
r isDac- Um Feb
'
4
No.(
'544'
1"? "'7
"
Mar Apr.
300
200
•
•
•
-I
FEDERAL RESERVE BOARD
WASHINGTON
ADDRESS OFFICIAL CORRESPONDENCE TO
THE FEDERAL RESERVE BOARD
X7425
April 29, 1933.
SUBJECT:
Indebtedness of Officers and Employees.
Dear Sir:
3ecause of the special relationship that exists with member
banks and the high responsibility resting upon the Federal reserve
banks in connection therewith, the Board feels that it is especially
important that the Federal Reserve Agents and their assistants,
including the members of their staffs engaged in audits and examinasiaould refrain from incurring any indebtedness, directly or
indirectly, to member baliks, their subsidiaries or affiliates, or
otherwise placinE themselves in any position which may result in
questions being raised as to the independence of their judgment or
their disinterestedness in the discharge of their responsibilities
with respect to such banks under the Federal Reserve Act.
Further-
more, in order to avoid the possibility of embarrassment in connection
with the performance of their official duties, it is the view of the
Board that they should refrain from incurring any indebtedness to
others except for legitimate and necessary purposes, and that,
whenever any indebtedness is incurred by them (excluding, of course,
VOLUME 241
PAGE 13
I.
X-7425
- 2current bills for ordinary personal and household expenses, but not
excluding indebtedness incurred to others to obtain funds for payment of such bills), there should be prompt disclosure of all the
facts to the Federal Reserve Board.
The Board desires that each Federal Reserve Agent prepare and
transmit to it as promptly as possible after July 1, 1933, a report
showing as of that date any indebtedness of the agent and members of
his staff (excludimg, of course, current bills for ordinary personal
and household expenses, but not excluding indebtedness incurred to
others to obtain funds for payment of such bills).
The report should
set forth the name of the person, firm, corporation, or institution to
which the indebtedness is due, the date on which it was originally
incurred (indicating whether before or after such officer or employe
e
entered the service), the maturity of the indebtedness, the unpaid
balance, a description of the security therefor, if any, a
brief
statement of the purpose for which the indebtedness was
incurred and
the progress being made in liquidating it, and any
comment that the
Agent may wish to make in connection therewith.
In addition, there
should be a prompt report to the Federal Reserve Board
of any indebtedness of the kind referred to incurred by the Agent or
any member of
his staff after July 1, 1933, and such report should
contain information similar to that called for above with respect to indebte
dness
outstanding on that date.
The Board believes that the directors of the Federal reserve
banks will feel that the same general principles should
be applied to
the members of the staffs of the Federal reserve banks,
particularly
the officers, the heads of departments, and other employe
es occupying
dl
•
X-7425
- 3responsible positions, except that the reports mentioned would be made
to the Boards of Directors instead of to the Federal Reserve Board. It
requests, therefore, that this letter be brought to the attention of
the Board of Directors of each bank, with the suggestion that they
consider the advisability of adoTAing these principles if they have
not already been established, of taking appropriate steps to obtain
from such officers and employees information similar to that called
for with respect to the Federal Reserve Agents and the members of their
staffs, and of requiring all such officers and employees promptly to
reloort to the Board of Directors any indebtedness of the kind referred
to that may thereafter be incurred.
In this connection, the Board desires to call attention to
its cirgular letter of May 7, 1924 (X-4048) which contains the folloring
statement:
" * * * the Federal Reserve Board believes it will be as
obvious to the directors of the Federal reserve banks as it is
to itself that the good conduct and repute of the Federal Reserve
System require that the officers of the reserve banks shall give
their entire ti:ne and attention to the affairs of the banks and
not be identified with ary gntside business interests."
The Board feels confident that the directors of the Federal
reserve banks will recognize the importance of strict conformity with
the principles set forth in that letter.
While it refers particularly
to the officers of Federal reserve banks, it is equally applicable to
heads of departments and employees occupying responsible positions in
the banks, as well as to the Federal reserve agents and the 1:ae:libers of
their staifs.
If any of than has any connection rith a business con-
cern of any kind, the Board requests that it be promptly advised with
respect thorcto.
X-7425
1
k,
— 4 —
The Board will be pleased to have an acknowledgment of the
receipt of this letter, together 7ith a statement of the
action
that has been or will be taken in regard to these matters.
Very truly yours,
Chester Morrill,
Secretary.
TO A.GENTS OF ALL F. R. BANKS.
--
ibr 3. 1933
Mr. Morrill
Dirtiet Loans to Isdividsals. eta.
Mr. tun Fossen
COXIMIrrioNk
Attached 'aoreto is
statism% ehowine the muster o
lications of
Junividuals, p&rtntrships awl eroperstious for locsis r.o t :aonted by the
Alfieri reserve banks durliw. the ealeodar year 1933 te Mardi 31. induding
& tabulation of the rioxsons for sot amain
the lo:Ams aprAied for.
It rill be notel that of 51 ar1io4tioni rktused, as awes ia the
stateliest, 38 were because of naestisfsetory sccarity; 19 paper not uligible;
east 1 ether credit available.
Direst loElas to individuals, partaerships imil corporations o:rantedty
the 'lidera' reserve bank-,daring the first qtarter of 1933 est the vaiount
of smolt loans orititt.-:n4',174 oa 'larch 31, 1933 were as follovsa
Aerlasal SMOBIAITIOlit,1111111jets. 1 I
Assent secured
to War.331 *Data
U.S.Govt.
o tklitn9lis
OM.
M
410001
101
OM
OPM
IM
IMMO
MM.
M
411.11
1.1
•1411
•11141111
oklyn* :s.T.
Pidlea
ila ioti
itostriliai
itaii 4i
4.i lll
lllUlik
k
Bn•Rfie
Banu• Refrigerator
ao Oe.,
a earfield, i,..
it,-.,.
e, aeril,
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Mtg. Go..
o. Piae
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9,500
.
'15,000
1,0
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30
2
2,'
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15,000
500
31
301
bti
bitria,.a
,..jannlg
nilagatnb
tinkbl
i
it
asns
assynts Ct
Citi Ara,
r,ls
luseraa
ra, We
e
4428,
8 100
0
l'esoare
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s Saari/we
ar/e i
it Lima
ia C.14
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orl sad
a 144ses
4ss. Ciaciatie
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i Ohio
ho
'401
'14,001
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a
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0
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,
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,=.?6,
=?,(r:
(Yr::
U,750
,5
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14,1r- )
2.0
28.000
A
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4 750
5 \-)1,0
14,100
Mr. Vor-1,11
*2
SOMAIMUNDme- 714911
Amnia eastroil
Jon. 1
bcrLl.iievt.
Total
to altr.31,
Li. 1W
AdVaseict
ZAIMULAMOULAMILSIJAWIROL
Tidbit% Itilleott City, O.
ZilliaktAiainAtaksaLasSaa
41/Aoth 1111o, See Grimes, La.
iLtkilleme lOs,
*OM Oa,
(Mimes S. L,
City So* & ?mot 0;o4., theni, tok,
441o. IL am low Orlon% Is
Xmpire Trost Gs., 1tlaulls0 se
,
1.4a.
lottera Logi liarit, Jew Oilloons. •
•
*.
Aims
Co&•
shosAte City ft*,
DT. Atelph isteebe, New Creleans. X*.
0
•
Laws Cation *ill is
•
0
seat
••
Bye Mesas Storeleriog Co
bassi. leabovasik, Pop1arv111o• Is,
Southern Poem Co., Now 0I1ecx
640. S. 14014 abibdAW4 Wise,
145,Goo
15,000
$5.000
all,692
•
*A 300
.30,000
ZOO
'
*11,000
*300.000
*950
*20,000
*930
*10,000
*600
411MO
2.000
11,000
300.000
950
II%000
500
2,000
11,000
300,000
950
25,000
50.
••••111
1
480.*
*1,000
.600
1,000
lev
01.111.
411.10
'4017
%00
611
6o!.)
IIIIMUSINCOLAMIL91
110, Ina.
500
UAW:* OseiaseilMilk 0*.•
000
210.
•
Intors:=tionat Jsrv.at.r Co., Chiesq-o, 111.
(7.500
7,500
A. 1„ inpf4114p Payettortile, Ti.
hOWNINUALSEPAANtAtit-Irlip
ilkiters Sonk 'Trutt Co., Alitaelphis, Ask.
Iammo a norebouts Soak, Dee Are, Mt.
• Saliker4 Colton, St, Unto, Mo.
*4,750
'1,5O0
reftwAl 1#0srtik
sank at Mk Mere Ilk Miro itan,
)
(
144 75
14.o6o
',(01
asteiarie Comolik, Co.. Irlegirs• 112116
1tast11 4 0*.• Yerep• I. D.
K. tistinon„
*4)•937
*3,325
30,000
cfltY
1 101 1411110,1% ablit ativaisif
"
"
ati
Sertil
Uo.„
y
&
Theor
r
a
Immibe
11100 mexic
36,794
SMIXAS1121.
Ong Ilkosirfa
*93•coo
A. Orodit names t;oaps.,Theeitlx, Arts.
79,000
•
Ida.
a.
Aseriewk Ilnot Co., Coeur Vaas
(X)
•0
00
1140
.
4
Sotroln.•Caalf
Morale, say. Loin
93,000
79,000
flovensaast oblipations.
by 11,
raut4foo4 to *light yowl*tea.
eleassimi
4,750
11,O(0
5oe
30,000
93,000
79,000
ARTIERS4
IOATIO1i 01 DOD
BY WI
AM) CORPAA71!YRS FOB LOWS SO? GUMP
MAIM 31, 1933
ammorrairmwromearioriannwria....a.marm•
Plasma
eaatire
Sank
Illamber of ç1tctionc %Asa imber of 4110/19n1 f.2.r
owlimam's
29t AXABALIO
I
14,per
It mated,
not
i MarcLL,ry,
ik nuary I to
oltrible
I
1933
1933
qn
Gtoa
Nor To*
Philadelphia
feY*1
3
nichaft Ald
Attliatr:
1
4
:Ann. ?mutts*,
?eta
$2,097000
20,5
(X)
5
Wee.
3
3
3
15,000
1
otr
393.Too
297,200
5,000
NIP 411,
011a
2
3
3
01.111.
zt. Lo
Utonsapo1is
Kerala* C tir
I
0ther
Paver not
erPtit
eatistaeto ri2,74
seamen. ] Available
13
1
3
Anomit
1ocas
declined
January 1 to
Mp.r.31.]33
16000
1
MINIM
Okla
1
40.0
Am.
4110011P
MM.
OMNI.
1.1941111
22
12
511
20,110
41.111P
•Ap2.1roxisiet I viomato %omitLees nt stated.
3o0
1.0R
Form No. 131
Office Correspontence
To_
Mr. Hamlin
From
Mr. Goldenweise
FEDE
RESERVE
!ARD
110
Pate
2lay 4, 1933
Subject:
Opt)
- L
I believe the statement in the nara;=
2-8495
of ?:alter Lippmann's
:article in the Tribune for :lay second, to which you refer, is fac—
t 1 ly correct so far as it goes.
se
of the subject.
It does not, of course, cover
The argument about the British
4
bought an American bond
rior to England's susnension
andaro, for instance would lot apply to a Frenchman
of the $d
it v..
who,ADoM± an American bond either before or after September, 1931.
Ivestors, of this class would receive a smaller amount of their own
currency for the :100 bond now than the:/ ilvested in the first place.
Linnmann, furthermore, ignores entirely bonds that are payable in
gold of standard value.
.
Bonds of this kind, particularly bonds of the
United Stettes Government, •raise a question of internatio
'.0
Opod faith.
The last sentence, which says that depreciation of the dog
Jp ,
balance profitable to our foreign debtors, also ignor
,
t
,
on
07
t‘are
expressed in gold.
4t.
VOLUME 241
PAGE 37
/
Form No. 131
Office Correspontence
To
Mr„Alaxlin
From _
ir Smead
FEDERAL RESERVE
BOARD
111
May
Date
1933
Subject:
aro
Referring to your May 3 memorand-um, the amount of gold and gold
certifica,tes rec, ived. by the Federal reserve banks and by Treasury
off.ces from March 6 to May 1, inclusive, was as follors:
Yederal reserve
banks
Gold ctificates
C-old c(fin
Gold builion
Total
VOLUME 241
PAGE 46
#
Treasury
offices
$41g ,725,000
$24,g35,000
295,665,000
,602,000
4,521,000
718",911 ,000
29,497,000
2-8405
. O. 131
Office- Ccirrespontence
To mr.
Hamlin
From _ Yr—
FEDERAL RESERVE
BOARD
Subject:
Goldenweise
Date
Uhy 6, 1933
Interest rates paid by small
•
borrowers
a/PO
2-8495
71e have no direct data to answer the question raised in your memorandum
of May 3, relating to interest rates paid by small borrowers dependent largely on an individual bank.
The rates which banks report to us monthly refer
to the range of rates charged on the bulk of their loans and exclude exceptional cases represented both by the lowest rates charged and by
rates charged.
he highest
,n the assumption that the highest rate reported by each in-
dividual bank im each city would more nearly reflect the rates paid by the
customer to which you refer than any other information in our possession,
have had the attached table prepared comparing the range of rates in January
and April 1933 with similar rates in January 1927.
These rates show many
changes between 1927 and 1933, with about as many advances as there are declines.
Ly own judgment is that the rate which the small man pays just now
, of his
depends very largely on his awn credit standing and the liquiditbank.
If his credit standing is good and the bank is liquid, he pays a
lower rate because money is more abundant.
If, on the other hand, his
credit is somewhat strained or his bank is somewhat frozen, he is likely
1
to pay much higher.
This is indicated by the general situation as we know
it and is confirmed by the lack of consistent movement in rates quoted by
different banks, as shown on the attached table.
RT17241
tjan
927
927
Jan 1927
,
JanvfNig
AMES
VIDUAL EU
14
)rime cora
paper
Janus:
192'
'y Weight
rates
1Welglited Ianut
19
1, rates
Boston
New York City 14i
Buffalo
Philadelphia
41
Cleveland
5
Cincinnati
Pittsburgh
5
Richmond
5715
Baltimore
Charlotte
Atlanta
Birmingham
Jacksonville
Nashville
New Orleans
16
Chicago
-14i
Detroit
St. Louis
5
Little Rock
5
Louisville
15i
Al
Minneapolis
6
Helena
Kansas City
5
Denver
6
Oklahoma City 5
Omaha
Dallas
5
El Paso
6
Houston
San Antonio
San Francisco 5
6
Los Angeles
7
Portland
Salt Lake City
Seattle
'6
Spokane
4
i
1
'2
M.11,
2
-6
1
-6 1- - -2
-8 5 -7
-8 6 -8
-7 5 - 7
6 -8
-6 5 -6
-7 16 - 7
-8 6 -8
6
6
-7
-7
15 - 7
•• •
3.82
3.62
5.60
4.79
5.14
5.79
5.77
4.50
5.54
5.55
4.78
6.18
6.33
6.00
5.41
4.07
5.78
4.62
6.54
6.00
3.37
7.46
5.30
4.50
6.00
5.21
5.17
7.20
5.72
6.32
5.32
5.87
6.08
6.00
5.82
5.97
S- OF LOANS
D BRANCH CITIES
!OIERS ON DIFFT
'EDERAL RE6h1AVE
RANGE 0
,
.• AS REPORTED
15 -7
16 -8
16 -8'
5 -6
16 -7
16
6 -7
5 -6
4.79
3.94
5.60
5.02
5.25
5.80
5.87
4.75
5.56
5.10
4.90
6.18
6.33
6.00
5.79
4.28
5.90
5.02
6.54
6.00
3.52
7.46
5.00
4.62
6.00
5.21
5.55
7.20
5.79
6.00
5.42
5.87
6.04
6.00
i
5.82
I 5.93
'ed by warehouse receipts
Lot
ryllueighted Aprili-eighted
3
rates . 1933 rates
+
6
4
6
6
6
41 -
3
6
6
5 -6
5.30
3i-5
3.75
6
6.00
51-6
5.43
6.00
6.18 '6 -7
6.00
6
•••
•• •
6 -?
4-5
- 6
2
-8
6
Al
- 5
6 -8
6
•••
-8
6
6
-7
6
6
7 -8
5 -10 56
5 -6 5
7 -8 16
7 -8
7
- 7 (1';
8
17
6
-7
8
?
-7
-8
-6
-7
7
- 7
6.00
5.70
4.24
6.75
7.08
6.00
6.07
4.94
5.52
4.88
?.10
6.00
3.19
6.54
5.15
6.96
7.00
6.38
5.92
8.00
5.65
7.0
(J
5.66
6.30
6.33
7.00
6.76
6.80
6
5 -6
6 -7
6 -8
51-8
6 -7
5 -6-.23•• •
41 -6
64-8
6
4 -5L
6 -8
14L-6
6 -8
6 -8
6
6 -7
8
6 -8
5 -6
6 -7
41-7
7
6 -7
6-7
5.40
4.55
6.00
5.59
• ••
6.36
6.00
• ••
6.00
5.40
4.99
6.75
7.08
6.00
5.96
5.32
•• •
5.27
7.17
6.00
3.51
6.54
4.93
6.67
7.00
6.38
5.66
8.00
5.53
7.14
5.79
6.38
6.29
7.00
6.73
6.57
134,
Form NO.
:
IrOffic Correspontence
To
Mr. Hamlin
Fro
Mr. Smead
FEDERAL RESERVE
BOARD
Date
Mai 5, 1933
Subject:
Referring to your memorandum of May
3, so long as Covernment se-
curities may be pledged with the Federal reserve a.--:ents as collateral
security for Federal reserve notes the possible expansion in Federal
reserve note circulation is limited only by the amount of cash reserves
If the FederL1 reserve barLs after settin,7 aside the minimum reserve
against deposits, and not by collateral requirements.
On May 3 cLsh reserves of the Federal reserve banks amounted to
$3,654,000,000, of which $326,000,000 was needed to cover the minimum
reouired reserve against deposits and $2,328,000,000 was available
against Federz,1 reserve notes.
On the basis of the 40 per cent reserve
against Federal reserve notes in circulation, the maximum possible
eral reserve note circulation was 47,070,000,000, or $3,675,000,000 in
excess of the amount of notes actually in circulation on that date.
If the minimum reserve requirement on deposits were reduced to
20 per cent the recuired reserve ag2ainst dencsits would amount to but
472,000,000, leaving $3,182,000,000 of reserves available aFainst lfederal reserve notes.
If, furtaermore, the reserve against Feder 1 re-
serve notes tere reduced to 25 per cent the maximum possible Federal
reserve note circulation would
be $12,728,000,000, or $9,333,000,000 in
•
444.44.
excess of actual circulation on May 3.
The Reserve banks may also isgue
Federal reserve bank notes in practically unlimited amounts since,
VOLUME 241
PAGE 61
Mr. Hamlin - t=2
aside from the collater; 1 requirements, they need maintain only a
5
per
cent lawful money redemption fund agLinst such notes.
The Federal reserve banks could not, of course, put into circulation additional Federal reserve notes or FederP1 reserve bank notes
on
an extensive scale without resortir
approximately equal amount.
to open mai'ket operations in an
•
The su--ested issuance of United States notes
on the other hand would not involve open market operations on the part
of
Federal reserve banl-s but would be effected through payments by the Government, either in reduction of the Tiblic debt or in meetinz aurrent
expenses.
If there is no widespread lc.ck of confidence in our
any sub-
stLntirl additional issues of currency, whether in the form of 7ederal
reserve currency or F-reenbacks, would be in excess of the public delmnd
therefor and would promptly find their v.ry into the Federal reserve bLnks
with a consequent building up of the excess reserves of member brei:
Consequently the creating of member bank excess reserves would._ rdult
from either the purchase of securities by the Reserve banks or the
tsviance
of greenbaCks.
Once zreenbacks viere issued it mipht be difficult to re-
tire them, at least rs promptly as conditions would warrant.
It would
101'
_
i,-.
seem, therefore, that the purchase of United States Government securities
by the reserve banks would be much preferable to the issuance of
greenbacks.
In this connection it is of interest to recall that prior to
•
1933
the maximum amount of money in circulation on the basis of monthly averages
Vt'aS
.,)5,b1,000,000, in July 1932, and th;--t the amount of money in circu- --
lation on May
3
was $5,954,000,000, which represents a reduction of
--,_
y1,627,000,000 from the all time Pe
'
ak of 0,581,000,000 on March 13,
1933,
)
NOT FOR PUBLICATION
DENOMINATIONS 07 PAPER CURRENCY IN CIRCULATION
Changes in the circulation of various denominations of paper currency are shown by the accompanying tables and the chart.
The figures
represent volume of paper currency of each denomination outside the Federal reserve banks and the Treasury, except for
4 to 8 percent of hold-
ings of the Federal reserve banks and the Treasury which are not sorted
by denominations.
October 1930.
RP9orts are for the end of each month beginning in
Because of a seaF,onal movement in demand for currency
and because of certain deficiencies in the figures, precise comparisons
of circulation in various months are somewhat misleading.
From October 1530, when hoarding began in large volume, to the end
of January
1933, prior to the financial panic, the amount of bills of
$50 and over outside the Federal reserve banks and the Treasury more
than doubled, increasing from $650,000,000 to nearly $1,500,000,000.
The circulation of $20 bills increased by about one-third.
At the same
time, the demnnd for small denomination bills, which furnish the bulk
of hand-to-hand currency used in every-day business, was actually declining.
The amount of one dollar bills outside the reserve banks and
the Treasury decreased by $30,000,000, or somewhat less than 10 percent.
There was a still larger proportionate decrease in the twos, and a decline of about 7 percent in the fives, while in the circulation of $10
bills there was little net change.
Increases in demand for larger denomination bills were especially
marked in periods when currency was being withdrawn for hoarding in
TOLUME 241
PAGE 81
•
2.
large volume, as in December 1930, when the Bank of United States suspended; in the months of June to October 1931, when serious banking difficulties were widespread; and again in June and July 1932, during the
bank runs in Chicago.
At these times, the bulk of the increased demand
for currency was for bills in denominations of $50 and over, although
there was also some increase in the 20Is and 10Is.
When there was a re-
turn of currency after these periods of rapid increase, as shown on the
chart, the return of large-denomination bills was considerably smaller,
in proportion to the preceding withdrawals, than the amount of $20 and
$10 bills.
From the end of May 1931 to the end of January 1932, $550,-
000,000 in bills in denominations of $50 and over were withdrawn from
the Treasury and the Federal reserve banks, of which only $50,000,000
had been returned by the end of May 1932. At the same time, the use of
$20 bills increased by less than $250,000,000 and $55,000,000 was returned.
The 'bulk of the increase in volume cf large bills outstanding has
been in $100 and $1,000 bills, as indicated by the record of total amount
of each denomination issued and outstanding, including holdings by the
Treasury and the Federal reserve banks, shown in the second table.
The
extent of the growth in demand for large bills of various denominations
is not known precisely for the reason that holdings by the Federal reserve banks have never been assorted separately by denominations, but
have been combined in a single class of fifty dollars and over.
Division of Research and Statistics
Federal Reserve Board
May 1933
I
•
•
3
DENOEINATIONS OF PAPER CURRENCY OUTSIDE FEDZIAL RESERVE BANKS
AD TREASURY, OC:OBER 1930-MARCH 1933 1/
thousands of dollars
1Amount in
F.R.banks and
$50
End
Treasury not
and
$20
$10
1
$1
$2
of
$5
assorted by
over
month
1
denominations
1930
October
November
December
3E58,949 43,192 560,939 1,029,436 1,054,263
397,193 )43,05)4 675,523 1,059,376 1,090,645
403,678 ,038 696,156 1,002,644 1,123,709
643,787
703,506
852,246
104,353
59,564
113,915
1931
January
February
March
April
May
June
July
August
September
October
November
December
369,854 41,4j3 644,398 1,012,127 1,077,880 789,016
370,822 41,137 636,922 1,013,317 1,078,311 784,258
358,985 40,462 630,357 1,014,778 1,070,426 735,425
372,97 40,685 630,178 !,020,992 1,085,421 846,323
376,509 0,198 639,221 1,029,8771,009,594 861,368
3()
4,058'39,312 S44,137 1,030,875 1,114,557 932,252
73,)45J9160
639,732 1,041,084 1,118,392 949,473
377,509 39,)4)4165S,538 1,076,658 1,175,374 1,047,371
332,400 39,377 063,906 1,029,385 1,226,0o6 1,153,992
385.265 39,215 685,030 1,153,557 1,299,137 1,278,332
354,539 33,990 582,044 1,133,773 1,301,301 1,260,542
357,590 39,549 653,676 1,144,674 1,32,525 1,336,253
96,048
75,659
71,668
111,673
104,743
100,177
102,926
103,323
102,650
83,518
54,5c4
97,521
1932
Yanuary
February
.arch
April
f,a.3r
Tune
Tuly
August
September
Dctober
l'ovember
December
355,574 36,931
360,679 36,641
353,369 35,506
352,345 35,025
353,002 34,572
349,725 33,663
347,904 33,268
347,81533,390
355,509 33,327
35E5,064 33,272
358,231 33,760
368,492I54,33C
549,523 1,115,594 1,325,360 1,409,964
643,203 1,113,151 1,325,727 1,306,914
624,102 1,077,074 1,239,343 1,342,969
629,012 1,075,777 1,230,301 1,349,433
624,870 1,069,263 1,274,733 1,361,556
523,413 1,050,699 1,312,570 1,512,050
624,909 1,100,827 1,334,825 1,506,291
623,196 1,097,005 1,326,025 1,491,445
626,949 1,101,732 1,311,367 1,457,713
629,122 1,103,146 1,301,445 1,434,565
528,316 1,097,818 1,315,039 1,434,292
634,861 1,109,053 1,307,341 1,435,070
70,571
63,946
65,362
62,121
57,911
,5,379
6
0.5,737
b5,',577
71,427
70,247
70,052
77,284
1933
Tanuary
349,525 32,347 615,259 1,081,686 1,302,914 1,456,660
55,912
February
360,637 33,325 674,998
/larch
,
if These figures represent the total amount of currency of specified denominations outstanding at the end of the month as reported by the U. S. Treasury ("Denominations of Paper Currency Outstanding", Form 5702) less reported holdings of
the Federal reserve banks and Federal reserve agents and the vault cash of the
U. S. Treasury in Washington and of the New York Assay Office. Four to 8 percent
of the combined holdings of the Treasury and Federal reserve banks are not assorted
by denominations, as shown in the last column.
•
•
14.
VOLUME OF CURRENCY OF DENOYINATIONS OF FIFTY DOLLARS AND OVER
ISSUED AND OUTSTANDING OCTOBErt 1930-MARCH 1933 lj
(In thousands of dollars)
End
of
month
$50
$100
$500
$1,000
1930
October
November
December
282,327
290,372
337,954
328,190
347,466
403,_547
67,808
78,624
109,681
146,940
158,671
199,381
26,620
26,495
27,215
90,990
942,875
992,638
91,010
90,590 1,163,167
1931
January
February
March
April
May
June
July
August
September
October
November
December
331,091
320,412
324,145
330,959
334,164
348,164
355,465
381,550
433,777
465,866
466,398
475,983
409;104
403,i23
410:)91
424,517
429,634
458,508
471,195
507,169
572,082
651,484
652,178
689,530
110,185
110,349
111,072
115,006
113,735
121,E.74
123,286
133,608
156,762
173,583
171,614
179,483
201,189
206,505
207,098
208,988
209,333
222,745
223,691
239,367
277,606
325,191
320,708
332,)0I6
26,410
26,230
26,895
26,835
26,760
26,725
26,715
26,750
39,115
39,710
38,455
38,540
89,920
88,840
84,690
84,610
84,610
84,400
84,240
84,250
88,000
87,110
85,460
65,340
1,167,898
1,155,507
1,163,990
1,191,313
1,198,234
1,262,415
1,234,592
1,372,693
1,569,561
1,742,949
1,734,343
1,601,370
1932
January
February
March
April
May
June
July
August
September
October
November
December
487,820
486,397
474,311
472,136
472,055
500,404
502,569
500,221
491,407
482,675
480,038
483,074
720,855
717,231
698,687
700,357
703,716
788,707
794,762
795,798
783,665
772,671
773,281
781,077
188,689
_185,361
179,790
180,453
180,825
242,447
234,603
233,451
230,560
227,974
226,648
229,415
345,461
339,843
330,121
331,243
331,028
419,694
416,569
416,192
411,048
405,513
405,395
408,319
38,115
37,9-13
37,920
37,815
37,730
39,650
38,675
38,670
36,140
37,835
37,825
37,775
65,210
86,090
85,810
85,910
88,730
85,490
85,270
85,250
85,150
85,020
85,080
85,050
1,866,150
1,852,891
1,806,638
1,807,914
1,814,083
2,076,632
2,072,447
2,069,581
2,039,970
2,011,637
2,008,766
2,024,710
1933
Jamnry
February
March
483,031
572,549
586,545
791,696
949,313
977,974
233,163
302,420
330,249
413,506
533,143
568,954
37,630
40,845
47,360
85,740 2,044,765
88,020 2,486,288
90,240 2,601,323
$5,000
$10,000
Total
$50 and
over
Source: U. S. Treasury "Denominations of Paper Currency Oustanding", Form 5702.
1/ Includes holdings of the Treasury and the Federal reserve banks as well as
those of the public and the banks.
•
4 •
TbDusands
of dollars
DENOMINATIONS OF CURRENCY
(Paper currency outside Federal reserve
banks and Treasury)
Fifties
an& over ,
1 ,11.00
Thousands
of dollars
1,400
/
•
s -,,j" Twenties
1,200
1,200
- Ten:
7
3
1,000
1,000
g00
•
Fives
200
-0
1930
431
.1932
14•.,
1933
z
f
„IAA. fi,t4
CONFIDENTIAL
Tot for publication
A
EARrIa
TSES OF FEDERAL P--ERITE
Month
Federal
Aril
Earnings from -
Bank
Boston
Nor York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
AlkMinneapolis
MOrKansas City
Dallas
San Francisco
TOTAL
April 1933
March 1933
April 1932
Jan.-Apr. 1933
1932
Discounted
bills
$47,620
273,827
102,083
115,407
Purchased
bills
U.S.Gov!t.
securities
Other
sources
$73,056 $146,508
45,802 1,184,117
213,905
9,791
274,688
9,898,
$3,477
24,658
487
6,071
9,372
06, )4
10,205
9,103
4,666
2,31s
,JRIL 1933
1933
Total
Exclusive
of cost
nf P.R.
cua._ 4_11cy
tal
$162,37u
11,733
$270,661
1,528,404
326,256
411,726
584,966
183,195
235,105
$81,183
899,453
, 122,597
147,485
74,591
75,923
388,705
103,435
3,100
14,597
21,472
6,222
133,815
169,775
527,918
130,360
127,836
119,722
303,67s
119,464
-22,099
23,779
1.73,615
-11,206
95,543
90,346
84,968
194,373
1,976
18,438
2,018
21,732
134,830
162,788
108,202
497,443
89,678
151,803
99,358
272,528
112,0
17522
120i;
1,069,407 275,769 2,927,102 129,910 4,402,168 2,449,703
2,777,282 40:z,749 2,752,284 150,117 6,083,432 2,478,731
1,700,390 202,931 2,050,571 162,311 4,116,203 2,045,607
5,333,547 935,515 10,246,864 540,697 17,056,623 9,055,303
8,634,984 1,695,075 6,445,858 954,195 17,730,112 8,285,918
2,790,(
50,053
69,883
50,857
10,498
28,208
49,138
18,898
252,935
1403
Jan.
Apr. 1933
Current net earnings
Less accrued
Ratio
dividentfts
and
to
Total
net charges
paid-in
capital (current) to
profit and loss
Per cent
I $194,730
-$22,235
5.5
3,593,088
18.7
2,457,285
Current net
earnings
Ratio to
paidTotal
in
capital
Per cent'
Current expE ses
_
*Reserve
B-511
1,
9.2
18.7
9)4
12.9
6.3
13.6
781,841
650,980
14.9
14.1
454,226
339,686
37,218
176,141
665,294
2.2
11.5
13.1
-95,650
80,579
362,311
-150,428
11.0
43,292
- 84,322
-116,586
326,316
-44,652
22,150
-12,434
-12,747
9.5
297,30 2a0,140
23.1
103,849
-2,153
-38,258
555,088
13.1
22.9
15.7
13.5
17.4
6,693,166
13.5
9,064,349
17.4
2,112,04
10,363,41),
89 665,763,
. ,117
279
162
66
16.1
FEDERAL RESERVE BOARD
DIVISIOY OF BATIC OPERATIONS
MAY 12, 1933.
voLumr 241
PAGE 87
3,594,474
5,983,037
@FedFRASER