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Mr. Eccles stated that while he voted for the program which
had been negotiated with the Treasury he did so reluctantly because he
felt strongly that before any new, refunding, or conversion issues of
Government securities were offered to the public the market should be
permitted to make price adjustments which more nearly reflect the real
public market, always talcing into account the need of maintaining an
orderly market,

f e felt the proposed conversion was a case of pre­

judging the market.

However, he said, he realized that the compromise

program was the best that could be had in the circumstances, that it
was a very important step in the direction of a more flexible market
and greater freedom in the determination of System open market policies
that failure of the Federal Open Market Committee to approve the pro­
gram may have continued the unsatisfactory working relationship with
the Treasury that had existed in the recent period, and in these cir­
cumstances he felt justified in voting for it along with all other
members of the Committee.