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FEBRUARY 2, 1940.

Washington, D# C.
Dear Mr. Eccles:
This morning!s Tribune carries the announcement that
you have "been re-appointed for four years to the Federal Reserve Board.
I wish to congratulate you upon this reappointment
and your acceptance of the same.
The Board needs some man like yourself to keep it
stirred up and to keep things moving.
I have read
your talks and speeches very carefully. While I do
not agree with you in all matters, yet in the main I
do, and if I were not satisfied with your re-appointment and glad of your acceptance, I would most certainly
say so.
If you desire to stir up matters in the money world,
pursuade the United States Treasurer to issue two
billions of dollars worth of money backed by the gold
and silver that the United States already has in its
treasury. According to reports, the treasury has about
twenty-one billions of dollars in gold and silver in its
We have in circulation less than eight billions
of dollars. We have backing for our circulation of more
than two and one-half times in gold and silver.
England has withdrawn its gold behind the pound sterling
and says that it is using it in its equalization fund.
It would appear to an outsider that our equalization fund
is being used to keep up the pound sterling.
Do you
think for one minute that England would do this if we were
in the same position? I do not.


Hon* Marriner S. Eccles -2The United States borrowing money and paying interest
only creates a heavy burden upon our taxpayers*
The only way that you can get these money changers to
loosen up is to put some more money in competition with
theirs • Borrov/ing from them only keeps the money going
in a circle and all the time increases the burden upon
our people*
When the President demonetized gold that book credit
was never put into circulation, so demonetizing gold
meant nothing as far as creating money for exchaiige
purposes, so our Government kept on borrowing* Morganthau kept that for his equalization fund, and I understand that he never used more than three hundred million.
The other billion and a half lies in the treasury buried
and still Uricle Sam borrows money.
I may be wrong in my summary but that is the way it
looks to an outsider.
If you had a billion dollars
in your safe and wanted to borrow a hundred thousand
dollars, would you go out to the money changers and
borrow it, or would you take it out of your safe? I
think you would do the latter.
Xet Uncle Sam is doing
the former.
Wishing you success and with hopes that you will see
your way clear to straighten out some of these financial
problems, I remain,
Yours truly,


February 8, 1940

Mr. H. H. Henderson,
215 Central isuilding,
Ogden, Utah.
Dear Mr. rienderson:
I appreciate your letter of February 2 in which
you congratulated me on my reappointment for a four year
term on the Board of Uovernors. of the Federal Aeserve
Systenu Vvhile this appointment has not yet been confirmed
by the Senate, 1 am glad to have your felicitations•
In your letter you make the general suggestion that
all the gold and silver in the United States Treasury which
has not been monetized should be used as a basis for the
issue of new money so as to reduce the amount of the government's borrowings proportionately. xhis idea has been
suggested a good many times and some people even propose
that without any relationship to the gold and silver
possessed by trie government currency should be issued in
sufficient amount to pay off the entire government debt.
I discussed this general line of thought in a letter to
Senator Vandenberg of Michigan during 1938 when the subject was under discussion in Congress and I am sending you
a copy herewith thinking you will find it interesting reading.
Vuith best wishes, I am
Sincerely yours,

i. S # Eccles,