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Office of the President

September 16, 19U3

Mr* Karriner S. Eocles
Chairmanf Board of Governors
Federal Reserve System
Washington, D. C.
Dear Marriner*
I am attaching a copy of a letter I received recently from one of our students In the
armed services. Since reference is made to the
Federal Reserve and certain interesting observations
were made, X thought you Might be interested in see*
ing it.
Sincerely yours,
(Signed) W* C. Coffey*
W* C* Coffey




Sgt* K. I* Block, 37292008
Base Weather Station
A*P*0* 605
Miami, Florida
West Africa
Mr. W* C* Coffer, President
University of Minnesota
Minneapolis, Minnesota
Dear President Coffey1
Your letter of July 21st reached me in good time, and I was
certainly pleased to hear from you again* Since I wrote you last I
learned that your term of office had been extended another year* May
I offer you my congratulations and thank you for the service that you
are rendering to the University and to the people by consenting to
guide the University through this most difficult period*
Your comments regarding inflation were especially appreciated*
I have nothing hut the greatest admiration for anyone chosen for as
important a post as a director of a Federal Reserve Bank* I am especially
pleased that you, as well as many of our professors, have abolished the
Myth of the "ivory tower* * Hever before has " h need been so great for
men of vision end ideals to exert a guiding force in building our eoonony*
Bight now the monetary and price situation is probably the
greatest problem facing us* Victory is inevitable, but dark clouds of
inflation still loom ominously on the horison of peace* Ralph Kobey
points out in a recent issue of "Newsweek" that the excess purchasing
power which we are piling up during the war will continue to affect our
economic structure after the war* He disproves the theory that this
excess will be drained off in the purchase of consumption goods after
the war, since every dollar of production means another dollar of buying
power in and of itself*
You well know the results of inflation* But this time there
will be even greater cause for discontent and unrest* This time we will
have seme ten million men and women from the military services who will
form a formidable group if their plans are shattered by inflation*
You might be surprised at the number of men who are making
plans already for their return to civilian life* Publicly they may not
say much about it, but X have talked to innumerable men who are saving
all of the money they possibly can for the time that they get back* Sane

- 2 ~

are married or plan to be married and they ere putting money into a
house, a farm, or furniture* But this ia rare* The majority are
saving their monqy * counting it carefully * and dreaming of the comforts that it is going to buy*
But the point ia that they are dreaming of these things in
terms of pre-war prices* We in the Awy are not vitally affeeted by
prices* those of us in foreign service chalk up differences against
the oountxy in which we happen to do our small amount of buying* those
of us in the States buy little anyway* Certainly we read about the
price of furniture advancing 10t#T or some other price index going up
50$* But it doesn't strike heme the way it would if we looked at a
radio that we almost bought before the war for twenty-five dollars
and now find that we have to pay fifty dollars for it«
After the war that is the experience that eaoh and every one
of us in the Amy is going to have* We have saved our money ~ denied
ourselves many pleasures, and we are dreaming of a down payment on a
house, new clothes, marriage, etc* But our air oastles will fall with
a very discomforting thud when we find that we can buy only half, or a
third, or same smaller fraction of the ooramoditios we had planned* that
is when the protesting Murmurs of ten million hearts will swell to ft
crashing crescendo of condemnation against our government* The results
s a well be catastrophic*
that is the possibility* but none of us over here believe
that It will actually occur* We have confidence that men of knowledge
and judgment who are in positions of influence, such as you occupy in
the Federal Beserve System, will solve this problem for us* Our confidence is unlimited! you cannot afford to fail*
I shall feel honored to hear from you nt any time* I y best
wishes go to you for your continued health and success*

Sincerely yours,
(Signed) Ken*
Kenneth ! * Block
Sergeant, A* 0*