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Internal Memorandum February 8, 1954 Interview with Mr. Walter Wyatt, February 5, 1954. Gloyd fwalt, Deputy Comptroller of Currency, during bank holiday kept notes. Now practicing law in Washington. Walter Wyatt kept notes —. working day and night then, dictated to his wife when going to bed. Bank holiday — Woodin had called in 20 - 30 leading bankers} staff not allowed (Wyatt called in by Meyer). Sat outside and talked it over—Goldenweiser, Smead, Morrill, Wyatt—Came close to agreement; Wyatt dicta-ted memorandum of consensus. Measures taken to get out were those. lantine, Mr. Arthur Balr- 11:30 P.M., Tuesday, called in — asked to draft emergency bank- ing act. Harrison, Ballantine, Goldenweiser, Mills. Mentioned five items: each down on slip of paper. Drafted between 11:30 P.M., Tuesday, and 3*00 P.M. Wednesday. (Bank conservation act provision an old one; also another old one.) Became Public Law 1 of that Congress. Public thought it was the work of Brain Trust in New Deal. In fact, it was the work of career men in Federal Reserve. (The Supreme Court will recess for four weeks next Monday. He may have time in the third week of February. • Call him late Monday afternoon.) Washington Counsel1s office kept special files, more .closely indexed, Morrill always wanted to abolish them. Counsel1s office had a "Letter Book," chronological 1914-1942 on legal problems. Letter Book gives picture of what went on. Central files too loose in Washington. George Vest will know if Letter Book still exists • Dr. Miller came in to see Wyatt often after he moved over to Court. — 2— Hew York Bank, February 1929, started raising discount rate. Board refused—Roy Xoung, Mellon, Platt would approve; Miller, Cunningham, Hamlin, and James were against* James and Cunningham thought they saw agricultural trouble. Wanted Federal to stop lending money to speculating banks. Cunningham had list of 47 banks borrowing |1 million or more from Federal and lending $1 million on call. August meeting, Miller was disapproving — Cunningham pulled out list and passed it around* Every man there had bank on the list. "When Cunningham died, his widow gave the list to Mr* James. When he died, what happened to it? Smead had a lot of information. He was there when Wyatt went to the Board in 1917. All regional banks important in some phase* Roy Xoung knows a , ^ ^ 11I/I* *> ,:\- fc C vi, (K. k ii | id & jju» lot about the Federal Reserve of Minneapolis. * Federal Reserve of Minneapolis its A had accumulated more paper than capitalized value. Thought bank might be insolvent.t pas liquidated at more than face value. Xoung had broad experience and fine memory for detail. 1929 discount rate fight — he was always fair — never let ideas embitter him. Not vety busy now (this is the time to get him) — overweight, age 72 or id. Wyatt saw him last September. Had been drinking too much—stopped, bad gall bladder operation. Told Don 15 years ago he had a lot of papers} asked Wyatt to help. Made agreement with writer who died — in a mood to write reminiscences* We will need, says Wyatt, staff of research people/" ••' c-- w. v,.^(t\. u < Wyatt persuaded Mrs. Hamlin to put Hamlin papers into Library of Congress* Carter Glass married again; his family did not like his second wife* - 3 The night of March 3, 1933 the Board was in session until 3 Had tried to get Hoover to declare a bank holiday; he would not; but Roosevelt did. New Yorkygold got down to 22 per cent; the law required 35 per cent. Meyer wrote Hoover a "nasty letter,ft and had a Secret Service man slip it under his bedroom door. The Board wanted Chicago to rediscount to New York. There was a three-cornered phone call—Hew York, Washington, and Chicago. The Chicago bankers said, if refused to do this, ; they would take gold out the next morning. It then looked as if one would I close (i.e., Governor to declare a bank holiday), what would happen to the rest of the banks? The Washington staff divided the task of phoning all bank Presidents. Early morning call — g o t the Governor to declare bank holiday. John Sinclair of Philadelphia, only man they could talk sense to* Phoned Wyatt, saying "Governor Pincjiot is in Washington; find him; tell him to call me." Meyer said he could not do that, he could not have the Federal in that position. Sinclair phoned again. Wyatt climbed b§.ck five flights of stairs up the Treasury well (since the elevators were not operating). He went to Pinchot's house—all was dark; he pounded on the door and told the butler to have Pinchot call Harrisburg. This he did. George Horris s book of reminiscence accuses >5ratt of not cooperating. No\ L-ivc^ Young wanted to keep the Federal Reserve of Boston open — had plenty of gold. At 7:30 Young called Wyatt and reviewed conversation. Finally closed. Some small banks remained open. The bank holiday VBLS to enable them to stay closed. The bank holiday in Michigan lasted from 21st February to March. Huey Long needed an excuse for the bank holiday and found it in - 4the birthday of Jean La Fitte, the Gulf pirate. Bob Parker was the Federal trouble shooter. Roosevelt closed banks "under Trading with the Enemy Act. Then had to decide "who could open. Each bank had to apply for license. Board vent through examination papers—decided whether bank could reopen or not. Alabama bank was broke, and the President knew it; applied for job, but his report got into wrong stack, and his bank was allowed to open. "You can't make a liar out of the President. He said only sound banks could open, t!Ioufve got to make this bank sound," they said. R§?f Gidney (now Comptroller of Ciirrency). Mellon, Secretary of the Treasury, always voted to support New lorkj Jack Pole, subordinate, always voted against it. Mellon always won out. * MA:km 2/3/54-
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