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pij F'l B Y ?$Fu riuP^lNS NiftR 2 - 1951 Harch 23, 1951 Respectfully referred for the files of the Department of State* X2JD WILLIAM J. HOPKINS Executive Clerk Transmitting copy of letter, 3/9/51, which the President received from Honorable Thomas B. McCabe, tendering his resignation as Chairman and Member of the Board of Governors of the Federal Reserve System, effective March 31, 1951; together with a Copy of the President's letter, 3/15/51, to Mr. McCabe accepting the resignation, effective at the close of business on March 31, 1951* bk Dear Tom: In view ©f yo^r letter of March ninth and our earlier con versations on the subject, I feel that I have no choice but to accept y©nr resignation as Chairman.and as’a meaber of the Board of Governors of the Federal Heserve System* Accordingly* I do accept It to take effect at the close of business on larch 21, 1951* I remember very well that when you first accepted this appointment at my request you were expecting to stay only one year. I appreciate very much, the fact that you have been willing to extend your service from time to tins© at my request* You have served the government faithfully and veil through more than a. decade of your heat and most fruitful years* You brought to your work an exceptional equipment gained through wide and varied experience In finance and Industry. This enabled you to direct diverse operations and to give invaluable counsel In many fields of government activity* ' You have rendered distinguished service as Chairman of the :\ 'V’ of Co^z* : ;f € 7c ioi iJl Reserve Gyst I ’ Is posi tion# it has bee$ your particular responsibility to seel; to harmonize tho activities of the Federal Reserve Gys on ,Tlth the activities and need® of the Government* An w© have sought from time to time to meet changing economic conditions, we have been confronted with many difficult problems* You have undertaken to help find solutions for those problems with wisdom, patience and integrity. I am highly appreciative of your work as Chairman of .the Federal Be serve Board. I am particularly grateful for your part in bringing about the agreement between the Treasury Department and the Federal Reserve Board which was announced on March 3, You can be Justly proud of- this important step toward finding a solution of. the problems which those two agencies must meet together* .With warm personal regards, and all good wishes, SIncerely youra, Honorable Thomas 3* McCabe Chairman, Board o f Coverno Federal ieserve Syste Washington,, X). C * (COPY) U. S. Naval Station, Key West, Florida, March 15, 1951. Dear Tom: In view of your letter of March ninth and our earlier conversations on the subject, I feel that I have no choice but to acceptjpur resignation as Chairman and as a member of the Board of Governors of the Federal Reserve System. Accordingly, I do accept it to take effect at the close of business on March 31, 1951. I remember very well that when you first accepted this appointment at my request you were expecting tb stay only one year# I appreciate very much the fact that you have been willing to extend your service from time to time at my request. You have served the government faithfully and well through more than a decade of your best and most fruitful years. You brought to your work an exceptional equipment gained through wide and varied experience in finance and industry. This enabled you to direct diverse operations and to give invaluable counsel in many fields of government activity. You have rendered distinguished service as Chairman of the Board of Governors of the Federal Reserve System. In this position, it has been your particular responsibility to seek to harmonize the activities of the Federal Reserve System with the activities and needs of the Government. As we have sought from time to time to meet changing economic conditions, we have been confronted with many difficult problems. You have undertaken to help find solutions for those problems with wisdom, patience, and in tegrity. I am highly appreciative of your work as Chairman of the Federal Reserve Board. I am particularly grateful for your part in bringing about the agree ment between the Treasury Department and the Federal Reserve Board which was announced on March 3« You can be justly proud of this important step toward finding a solution of the problems which those two agencies must meet together. With warm personal regards, and all good wishes, Sincerely yours, s/ Harry S. Truman Honorable Thomas B. McCabe Chairman, Board of Governors of the Federal Reserve System Washington, D. C. IMMEDIATE RELEASE March 15, 1951^/The PRESIDENT has today sent the following letter to Honorable Thomas 6 * Me Cabi accepting his resignation as chairman and as a member or tne Jboara ox Uovernors of the Federal Reserve System:__ ___ 2 U.S.Naval Station Key West, Flordia, March 15, 1951 Dear Tom: In view of your letter of March ninth and our earlier conversations on the subject, I feel that I have no choice but to accept your resig nation as Chairman and as a member of the Boaftd of Governors of the Federal Reserve System. Accordingly, I do accept it to take effect at the close of business on March 31, 1951* I remember very well that when you first accepted this appointment at my request you were expecting to stay only one year. I appreciate very much the fact that you have been willing to extend your service from time to time at m y request# You have served the Government faithfully and well through more than a decade of your best and most fruitful years* You brought to your work an exceptional equipment gained through wide and varied experience in finance and industry. This enabled you to direct diverse operations and to give invaluable counsel in m a y fields of Government activity. You have rendered distinguished service as Chairman of the Board of Governors of The Federal Reserve System. In this position, it has been your particular responsibility to seek to harmonize the activities of the Federal Reserve System with activities and needs of the Government* As we have sought from time to time to meet changing economic conditions, we have been confronted with many difficult problems. You have undertaken to help find solutions for those problems with wisdom, patience and integrity. I am highly appreciative of your work as Chairman of the Federal Reserve System. I am particularly grateful for your part in bringing about the agree ment between the treasury Department and the Federal Reserve Board which was announced on March 3 rd* You can be justly proud of this important step toward finding a solution of the problems which those two agencies mist meet together* With warn personal regards, and all good wishes, Sincerely yours, /s/ Harry S* Truman Honorable Thomas B. McCabe, Chairman, Board of Governors of The Federal Reserve System, Washington, D. C. The following is Chairman Me Cabefs ifcetter to the PRESIDENT: March 9> 1951 Uy dear Mr PRESIDENT It is m y sincere request that you accept my resignation as Chairman and as a member of the Board of Governors of The Federal Reserve System, to become effective March 31* 1951* You will recall that when you asked me to accept the appointment more than three years ago£ I doubted if I could serve for more than a year* On several occasions I have brought up with you the subject of m y resig nation, but after each discussion final action was postponed because it seemed that each successive time the task which faced us was more compelling* Never before in the thirty-eight years of existence of the Federal Reserve System has the country ever had greater need of the wise and judicious exercise of its powers* The decision to resign under such circumstances has bden one of the most difficult of my life as I have deep convictions about the preservation of the integrity and the funda mental concepts of the system* I have felt that the Chairman of the Board of Governors has a special and dual role* As a Board member he must, with complete integrity, carry out at all times his responsibilities under the Federal Reserve act* As Chairman he must feferive conscientiously to harmonize internammy and externally the policies of the Board with those of the PRESIDENT and Administration. Throughout the three years since you honored me with the appointment, I have exerted the last ounce of m y strength to meet both of these obligations* Now that ire have reached a satisfactory understanding and have inaugurated a completely new Tsorkir^ arrangement with the Treasury, I feel that my personal reasons, with which you have been long familiar, must have overriding consideration. I would like to express my appreciation of yourcconfidence in appointing me to such high positions of public trust and for the personal friendship which you have accorded me. With very best wishes, I am Sincerely, /s/ Tom Thomas B* Me Cabe The PRESIDENT, The Miite House The PRESIDENT has also received the following communication from Mr Me Cabe: My dear Mr PRESIDENT: You have very graciously asked me to recommend m y successor as Chairman of The Board of Governors of The Federal Reserve System. I am happy to commend to you U l l i a m Me Chesney Martin, Jr., Ass in stant Secretary of the Treasury in charge of the Office of Inter national Finance. Mr Martin grew up in the atmosphere of central banking and throughly absorbed over his formative years its philosophy, as his father was Governor of The Federal Reserve Bank of St. Louis daring those years.. He has had an extensive and successful career both in Government and without, including the Presidency of The New York Stock Exchange and Chairman of The Board of The Export Import Bank of Washington. Of critical importance at this junction is the itatim&te part he has played in reaching the fine and full accord that now exists between the Treasury and The Federal Reserve System . ^ An accord which, in spy judgement, will resound outstandingly to the benefit of the Government Security Market and the people of the Ifnited States. It is vitally important that this accord be maintained. I would be loth to leave this position of such great responsibility if I did not feel sure that it would pass into such capable hands, and that the appointment would be so well received both within the Federal Reserve System and by the Fihancial Community generally. Respectfully, /s/ Tom Thomas B. Me Cabe MARCH 15, 1951 immediate ; release The President has today sent the following letter to Honorable Thomas B. McCabe accepting his resignation as Chairman and member of the Board of Governors of the Federal Reserve System: U. S. Naval Station, Key West, Florida, March 15, 1951 Dear Tom: In view of your letter of March ninth and our earlier con versations on the subject, I feel that I have no choice but to accept your resignation as Chairman and as a member of the Board of Governors of the Federal Reserve System. Accordingly, I do accept it to take effect at the close of business on March 31, 1951* I remember very well that when you first accepted this ap pointment at my request you were expecting to stay only one year. I appreciate very much the fact that you have been willing to extend your service from time to time at my request* You have served the Government faithfully and well through more than a decade of your best and most fruitful years. You brought to your work an exceptional equipment gained through wide and varied experience in finance and industry. This enabled you to direct diverse operations and to give invaluable counsel in many fields of Government activity. You have rendered distinguished service as Chairman of the Board of Governors of the Federal Reserve System. In this position, it has been your particular responsibility to seek to harmonize the activities of the Federal Reserve System with activities and needs of the Government. As we have sought from time to time to meet changing economic conditions, we have been confronted with many dif ficult problems. You have undertaken to help find solutions for those problems with wisdom, patience and integrity. I am highly ap preciative of your work as Chairman of the Federal Reserve System. I am particularly grateful for your part in bringing about the agreement between the Treasury Department and the Federal Reserve Board which was announced on March third. You can be justly proud of this important step toward finding a solution of the prob lems which those two agencies must meet together. With warm pa**«onal regards, and *11 good wishes, Sincerely yours, HARRY S. TRUMAN Honorable Thomas B. McCabe, Chairman, Board of Governors, Federal Reserve System, Washington, D. C. The following is Chairman McCabe's letter to the President: March 9, 1951 M y dear Mr* President: It is my sincere request that you accept my resignation as Chairman and as a member of the Board of Governors of the Federal Reserve System, to become effective March 31, 1951. - 2 - You will recall that when you asked me to accept the ap pointment more than three years ago, I doubted if I could serve for more than a year. On several occasions I have brought up with you the subject of my resignation, but after each discussion final action was postponed because it seemed that each successive time the task which faced us was more oompelling. Never before in the thirty-eight years of existence of the Federal Reserve System has the country ever had greater need of the wise and judicious exercise of its powers. The decision to resign under such circumstances has been one of the most difficult of my life as I have deep convictions about the preservation of the in tegrity and the fundamental concepts of the system, I have felt that the Chairman of the Board of Governors Ms a special and dual role. As a Board member he must, with complete integrity, carry out at all times his responsibilities under the Federal Reserve Act. As Chairman he must strive conscientiously to harmonize internally and externally the policies of the Board with those of the President and Administration. Throughout the three years since you honored mo with the appointment, I have ex erted the last ounce of my strength to meet both of these obligations. Now that we have reached a satisfactory understanding and have inaugurated a completely new working arrangement with the Treasury, I feel that my personal reasons, with which you have been long familiar, must have overriding consideration. I would like to express my appreciation of your confidence in appointing me to such high positions of public trust and for the personal friendship which you have accorded me. With very best wishes, I am Sincerely, TOM Thomas 3. McCabe The President, The White House* The President has also received the following communication from Mr. McCabe: My dear Mr. President: You have very graciously asked me to recommend my successor as Chairman of the Board of Governors of the Federal Reserve System, I am happy to commend to you William McChesney Martin, Jr., Assistant Secretary of the Treasury in charge of the Office of International Finance. Mr. Martin grew up in the atmosphere of central banking and thoroughly absorbed over his formative years its philosophy, as his father was Governor of the Federal Reserve Bank of St. Louis dur ing those years. He has had an extensive and successful career both in Government and without, including the Presidency of the New York Stock Exchange and Chairman of the Board of the Export-Import Bank of Washington, Of critical importance at this junction is the inti mate part he has played in reaching the fine and full accord that now exists between the Treasury and the Federal Reserve System, an accord which, in my judgment, will resound outstandingly to the ben efit of the Government Security Market and the people of the United States. It is vitally important that this accord be maintained. I would be loth to leave this position of such great re sponsibility if I did not feel sure that it would pass into such - 3 - capable hands, and that the appointment would be so well received both within the Federal Reserve System and by the Financial Com munity generally. Respectfully, TOM Thomas B, McCabe '*U. ip i MR. -CHAHI£§ _iIUB£HYT _KB¥ -WESZ, FLA, BOARD-OF GOVERNORS |\ \ ! / I\ \ OF T H E 7 / i \ A J L 11 \ FEDERAL RESERVE SYSTEM t -' A ^rVy. -077 C (3^/5J;4^ M Y D E A R MR. P R E S I D E N T : Y O U H A V E V E R Y G R A C I O U S L Y A S K E D ME TO R E C O M M E N D M Y S U C C E S S O R AS C H A I R M A N OF T H E B O A R D OF G O V E R N O R S OF T H E F E D E R A L R E S E R V E S Y S T E M . I A M H A P P Y T O C O M M E N D TO Y O U W I L L I A M M C C H E S N E Y MAR T I N , JR., A S S I S T A N T S E C R E T A R Y OF T H E T R E A S U R Y I N C H A R G E OF O F F I C E O F I N T E R N A T I O N A L F I N A N C E . ** * * MR. M A R T I N G R E W UP I N T H E A T M O S P H E R E OF C E N T R A L B A N K I N G A N D T H O R O U G H L Y A B S O R B E D O V E R HIS F O R M A T I V E Y E A R S ITS P H I L O S O P H Y AS HI S F A T H E R W A S G O V E R N O R O F T H E F E D E R A L R E S E R V E J A N K O F ST. LOU I S D U R I N G T H O S E YEARS. HE HAS HAD A N EXTENSIVE AND SUCCESSFUL CAREER BOTH IN GOVERNMENT A N D W I T H O U T , I N C L U D I N G T H E P R E S I D E N C Y OF T H E N E W .YORK S T O C K E X C H A N G E A N D ^ C H A I R M A N OF T H E B O A R D O F T H E ^ E X P O R T ^IMPORT J A N K O F W A S H I N G T O N . O F C R I T I C A L I M P O R T A N C E A T TH IS J U N C T U R E IS T H E I N T I M A T E P A R T H E H A S P L A Y E D IN R E A C H I N G THE FIN E AN D F U L L ACCORD THAT NOW EXISTS B E T W E E N T H E J E R E A S U R Y A N D T HE F E D E R A L R E S E R V E S Y S T E M . A N A C C O R D W H I C H , I N M Y J U D G B M E N T , W I L L R E W O U N D O U T S T A N D I N G L Y TO T H E B E N E F I T OF T H E ^ G O V E R N M E N T S E C U R I T Y M A R K E T A N D T H E P E O P L E OF T H E JJNITED S T A T E S . IT IS V I T A L L Y T m P O R T A N T T H A T THIS A C C O R D B E M A I N T A I N E D . I W O U L D .LOATH TO L E A V E T H I S P O S I T I O N OF S U C H G R E A T R E S P O N S I B I L I T Y IF I D I D NOT F E E L S U R E T H A T IT W O U L D PA S S I N T O S U C H C A P A B L E H A N D S , AND THAT THE APPOINTMENT WOU LD BE SO W E L L R E C E I V E D BOTH W I T H I N THE F E D E R A L ^RESERVE S Y S T E M A ND B Y THE F I NA NCI AL C O M M U N I T Y GENERALLY. RESPECTFULLY ( S IGNED) TOM T H O M A S B. M C C A B E BOARD OF GOVERNORS OF TH E FE D E R A L R E S E R V E S Y S TE M W A S H IN G T O N O F F IC E O F TH E C H A IR M A N B fc March ll±, 19 £l. J E T E R W P IE D ro QONFIDENTOL dear Mr. President: i. You have very graciously asked me to recommend my suc cessor as Chairman of the Board of Governors of the Federal Re serve System. I am happy to commend to you William McChesney Martin, Jr., Assistant Secretary of the Treasury in Charge of Office of International Finance. Mr# Martin grew up in the atmosphere of central banking and thoroughly absorbed over his formative years its philosophy is&r as his father was Governor of the Federal Reserve Bank of St. Louis during those years. He has had an extensive and successful career both in Government and without, including the presidency of the New York Stock Exchange and Chairman of the Board of the Export-Import Bank of Washington. Of critical importance at this juncture is the intimate part he has played in reaching the fine and full accord that now exists between the Treasury and the Federal Reserve System, An accord which, in my judgment, will redound outstandingly to the benefit of the Government security market and the people of the United States. It is vitally important that this accord be main tained. I would be loath to leave this position of such great re sponsibility if I did not feel sure that it would pass into such capable hands, and that the appointment would be so well received both within the Federal Reserve System and by the financial com munity generally. Respectfully, Thomas B. McCabe. The,President, The White House. B O A R D OF G O V E R N O R S OF T H E FEDERAL RESERVE SYSTEM WASHINGTON OFFICE OF THE CHAIRMAN March 9, 195>1« My dear Mr. President: It is my sincere request that you accept my resignation as Chairman and as a member of the Board of Governors of the Federal Reserve System, to become effective March 31* 1951* You will recall that when you asked me to accept the appointment more than three years ago, I doubted if I could serve for more than a year. On several occasions I have brought up with you the subject of my resig nation, but after each discussion final action was postponed because it seemed that each successive time the task which faced us was more com pelling. Never before in the thirty-eight years of existence of the Fed eral Reserve System has the coimtry ever had greater need of the wise and judicious exercise of its powers. The decision to resign under such circumstances has been one of the most difficult of my life as I have deep convictions about the preservation of the integrity and the fundamental con cepts of the System. I have felt that the Chairman of the Board of Governors has a special and dual role. As a Board member he must, with complete integrity, carry out at all times his responsibilities under the Federal Reserve Act. As Chairman he must strive conscientiously to harmonize internally and ex ternally the policies of the Board with those of the President and the Ad ministration. Throughout the three years since you honored me -with the ap pointment, I have exerted the last ounce of my strength to meet both of these obligations. Now that we have reached a satisfactory understanding and have in augurated a completely new working arrangement with the Treasury, I feel that my personal reasons, with which you have been long familiar, must have over riding consideration. I would like to express my appreciation of your confidence in ap pointing me to such high positions of public trust and for the personal friendship which you have accorded me. With very best wishes, I am The President, http://fraser.stlouisfed.org/ The White House. Federal Reserve Bank of St. Louis Sincerely, (COPY) BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON March 9> 1951 My dear Mr. President: It is my sincere request that you accept my resignation as Chairman and as a member of the Board of Governors of the Federal Reserve System, to become effective March 31, 1951• You will recall that when you asked me to accept the appointment more than three years ago, I doubted if I could serve for more than a year. On several occasions I have brought up with you the subject of my resignation but after each discussion final action was postponed because it seemed that each successive time the task which faced us was more compelling. Never before in the thirty-eight years of existence of the Federal Reserve System has the country ever had greater need of the wise and judicious exercise of its powers. The decision to resign under such circumstances has been one of the most difficult of my life as I have deep convictions about the preservation of the integrity and the fundamental concepts of the system. I have felt that the Chairman of the Board of Governors has a special and dual role. As a Board member he must, with complete integrity, carry out at all times his responsibilities under the Federal Reserve Act. As Chairman he must strive conscientiously to harmonize internally and ex ternally the policies of the Board with those of the President and the Administration. Throughout the three years since you honored me with the appointment, I have exerted the last ounce of my strength to meet both of these obligations. Now that we have reached a satisfactory understanding and have inaugurated a completely new working arrangement with the Treasury, I feel that my personal reasons, with which you have been long familiar, must have overriding consideration. I would like to express my appreciation of your confidence in appointing me to such high positions of public trust and for the personal friendship which you have accorded me. With very best wishes, I am Sincerely, s/ Tom Thomas B. McCabe. The President The White House
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