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RALPH

I. C O R Y E L L

BIRMINGHAM, MICHIGAN

June 33, 1938.
Mr. Marriner S. Eccles,
Chairman Federal Reserve Bank,
Washington, D*C.
Dear Mr. Eccles:
According to news reports the policy of bank loans
in regard to the expedition of business has come up
for discussion and you are reported as in favor of
a liberalization of present banking procedures.
Our business and banking practices are a matter of
evolution and if they should ever freeze into a set
pattern then we shall cease to progress in that
phase of our civilization*
No matter how far we may progress in science, in production, in selling, in meeting the needs of the
customers, if we fail in the handling of our finances
at the crucial times our country will continue to
have financial crises which might well be avoided
or partially be bridged over by proper financial
arrangements.
It is well known that at the present time bank loans
are available in large quantity but are not used to
any extent, for a variety of reasons. In Michigan
we have new banks for the most part And the commercial
loans-of one of them are about 3 o f the total assets
and of another about 1$.
On the other hand there are thousands of business men
who could use money for varying periods to good advantage, providing they could be assured of a reasonable
stability of market.
In order to get the borrowers and the lenders together
it might be necessary now to devise some new terms
of agreement, but the favorable factor of the utilization
of a large amount of credit is that business would be
stimulated and the probability of repayment would be
many times increased over and above the present probability.
I have heard many times the argument that the depositors
should be protected over and above the borrowers.
But how? Is the money to be put in a vault and kept for
them? Or are we to go back to the Bible and recall that
the servant who utilized the talents to the best advantage was to be best rewarded?



This country is a mass of movement, set up for action.
It does not operate well in a depression, but it really
operates fine at top speed*
A financial system organized on a flexible scale so
as to accommodate varying loads of stress, but especially
to encourage the spirit of individual enterprise will
best serve the needs of industry and government.
A financial system acting merely in a secondary capacity
to assist the Government and the banks, devoid of any
imagination or initiative, will be a poor dead thing,
unworthy of an active country like ours.
I do not know that I make myself clear but I think
there is plenty of room for improvement in finance
and I feel that there are men who are endeavoring to
work these problems through. If the Government, the
financial units and business will work together on
these problems jointly we should arrive at a satisfactory
solution more promptly.

RIC/r




RALPH

I. C O R Y E L L

BIRMINGHAM, MICHIGAN

June 27, 1938.

Mr. Kalph I* Coryell,
Birmingham, Michigan.
Dear Mr. Coryell:
This Is to thank you for your letter of June 22d
with reference to liberalization of present banking procedures. As the announcement of the program agreed upon
has now been made, you will note that considerable progress
has been made, especially in regard to the financing of
small and medium-sized businesses.
Your letter was of particular interest to me because it recognizes that the best way to protect the interest of the depositor is to make the banking system
function in the interest of borrowers and the economy in
general. Similarly, I was interested in and entirely
agree with your view that the financial system should be
organized, as you state it, u on a flexible scale so as
to accommodate varying loads of stress, but especially
to encourage the spirit of individual enterprise".
I felt that your letter reflected a very broad
view of the problems involved in this whole subject, and
I 7*anted you to know that I appreciate having your views
and your courtesy in writing.

Sincerely yours,

M. S. Eccles,
Chairman.

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