The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
Fe d e r a l R e s e r v e Ba n k OF FI CE OF T H E P R E S I D E N T of Ch ic a g o November 17, 194-7 The Honorable Marriner S. Eccles Board of Governors of the federal Reserve System Washington 25, D. C. Dear Marriner: Just a word to let you know what a wonderful job you did for the Federal Reserve System first by your talk to the combined boards of directors of the Dallas institutions and then your fine address at the dinner meeting. I wish all the Reserve City bankers in the country could have been present. I had difficulty in getting home. Didn't arrive in Chicago until seventeen hours after I left you at the Dallas airport. Kindest regards. Sincerely yours, November kl, 194-7. Mr. C. b. ¥oung, President, Federal Reserve xiank of whicago, Chicago 90, Illinois. Dear Hap: I appreciate very much your very thoughtful note of November 17, 1947 in regard to my talk at Dallas recently. Naturally, of course, I hope that it served a useful purpose and your impression is very encouraging. My curiosity leads me to wonder what you were doing all of that seventeen hours between Chicago and Dallasj I covered a much greater distance in a little over six hours! Very sincerely yours, M. £». Eccles, Chairman. CM: am REPUBLIC XATIOXAIi BANK O F 1D A L L A S C A P IT A L A N D S U R P L U S * 2 0 ,0 0 0 ,0 0 0 .0 0 DALLAS 2, TEXAS November 1 7 , 19U7 FRED P. FLORENCE P R E S ID E N T Mr. Marriner S . E c c les, Chairman o f the Board o f Governors Federal Reserve System Washington, D* C. Dear Marriner: I t was a p leasu re, indeed, to see you in D allas the p a st F rid ay. I had hoped you would have some time fo r a more relaxed v i s i t w hile you were here, but I know you were t e r r ib ly busy a t the Board meetings during the day and la t e r a t the dinner th at evening. I s in c e r e ly hope you w i l l be coming down again before long and that your time w i l l permit you to come out to my home f o r a v i s i t detached from the strenuous a c t i v i t i e s o f meetings and speeches. I was very pleased and impressed w ith your speech before the group Friday even in g , and I know those present were tremendously in te re ste d in your comments concern ing the current fo re ig n and domestic s it u a t io n . Your views on the fo r e ig n s itu a tio n were c le a r and c o n stru ctiv e, and I b e lie v e , as a r e s u lt o f the ta lk th at evening, considerable public opinion was molded in accordance with the thoughts expressed by you. I a ls o considered your warning as to the dangers o f in f la t i o n most tim ely and impressive and am in complete accord with what you had to say in that r e s p e c t. Because o f my personal frien d sh ip and admiration fo r you, I should lik e to be able to go a l l the way with your view s, but when they r e la te to the banking s itu a tio n , I have not f e l t they would prove to the b est in t e r e s t fo r the Country over a long period o f tim e, although I f u l l y r e a liz e and appreciate the n e c e ssity o f doing some thing to o f f s e t the in fla tio n a r y tendencies that are now running rampant. I have t h is thought and, on a personal b a s is , should be glad to have your reactio n to same. W hile you were in D a lla s , you s e t forth some very pertinent reasons why something should be done with referen ce to the c r e d it s it u a t io n . I b e lie v e i f a sp e c ia l l e t t e r were addressed to the member banks o f th is Country to be read to th e ir boards o f d ir e c to r s , in which you would o u tlin e the matter somewhat in accordance w ith your t a lk , you would fin d a wonderful response on the part o f the banks and p r e tty complete cooperation in confining th e ir loans to lin e s o f p ro d u c tiv ity and, by recommendation and persuasion under the in flu en ce o f your p o s itio n , good r e s u lts would be obtained. For a l l p r a c tic a l purposes, there would be accomplished the r e s u lts you have in mind. This would obviate the n e c e ssity o f s p e c ia l l e g is la t i o n to give such a u th o rity , and i f your l e t t e r to the banks in d icated th at you hoped i t could be accomplished without l e g i s l a t i o n , I b elie v e there would be a fin e cooperative a ttitu d e on the p art o f the banks. C erta in ly , we have been s u f f i c i e n t ly impressed by what you had to say to REPUBLIC NATIONAL BANK OF DALLAS - 2- operate our banks, for all practical purposes, in accordance with the suggestions you set forth. Please let me again thank you for coming to Dallas and affording me the pleasure of seeing you again. In the meanwhile, with warm personal regards and best wishes, I remain Very sincerely yours, November 21, 1947• Mr. Fred *. Florence, President, Republic National *%nk of Dallas, Dallas k y Texas. Dear Fred: It is very Encouraging to receive such a nice letter as you wrote me on November 17, 1947, following my visit to Dallas. I recognize that you do not concur in my thinking with respect to the banking situation but the fact that you are willing to listen to my views and to aid in bringing about their consideration by others demonstrates a broadminded attitude which I wish were more prevalent. I am afraid, how ever, that even a special letter addressed to the member banks of the country would not accomplish the purpose you have in mind because, in the first instance, it would have to be unduly long and, secondly, it is my observation that such communica tions are more likely to find their way to the wastebasket than they are to receive the desired attention at a meeting of a board of directors. I am inclined to believe that such views as I have expressed are more likely to be considered if they receive voluntary circulation by those who feel that they have sufficient merit for that purpose, as you indicate you have done in your own groups. As you know, these problems are now coming up for con sideration before various Congressional committees and in my appearance before those committees I expect to express as fully as possible the same views that you heard me express at Dallas. In this way, some additional circulation may be obtained. Thanking you.most sincerely,.! am, Very truly yours, M. S. Eccles, Chairman. CM: am S oveaber SO, I9k7 Dear J . R, t May X acknowledge to you the receipt of Mrs* Edwards’announcement of your aarriage to her daughter. I warn advised that you had hesitated at He* Orleans between returning to Dallas in your capacity as Chairaan or continuing on to Florida in your capacity as bridegroom* I think that any other decision than the one you made would have been inexcusable under the circuastances. 1 was, of oourse, sorry not to see you but I cannot inagine a better reason for your abeence. Let ae take this opportunity to wish you and Xra. Partan every happiness. Sincerely yours, Xr. J* B» Parten Laaar Hotel, Ecueton, Texas. At Home Lamar Hotel Houston,Texas Mrs. Walker G r a y Edwards announces the marriage o f her daughter Patsj Edwards PuterLangli to Mr. JuLal Richard farten on Eiday, October the thirty-first nineteen hundred and lortj-seven lexas Longview,Te; H. P. D p_ I_W a l d e c k ASSOCIATE ^ r o u g h t A t t o r n e y a t Law FROST BANK ca bl e a d d r e s s B U IL D IN G "D R O U G H T SAN A N T O N IO S a n A n t o n io 5 r T e x a s November 20, 194-7 Honorable Marriner S. Eccles, Chairman Board of Governors of the Federal Reserve System Washington, D. C. Dear Mr. Chairman: As I listened to your address in Dallas last Friday evening, the thought continually recurred that your audience, large and influential though it was, was entirely too restricted,- that most, if not all, of what you said should have been heard by the American public generally. It may be that, as I am one of the two American Directors of the Matador Land and Cattle Company, Limited, of Dundee, Scotland, whose ranch holdings in Texas are about as large as those of any other owner, I had a keener appreciation of your remarks about Great Britain than some of the other guests. But, nevertheless, any one not imbued with the false tenets of isolationism must have accepted your account of Britain's plight and of the treatment this staunch ally has received from us, and must have been deeply impressed by it. I am disturbed by what you told me during a re cess in our meeting Friday to the effect that there may be pressure again on Britain to liquidate British-owned assets in this country, and I earnestly hope that this pressure will not be applied. It seems to me that to in sist on a further liquidation of these assets would be roughly comparable to a banker insisting on a customer exhausting his resources in order to make himself eligible for a loan. It was a pleasure to meet you. Like you, I have enjoyed the honor of serving at some personal sacrifice under an appoint ment from President Roosevelt but, of course, in a much less important position than yours. It was of sufficient importance, however, to require me to share some small part of the brunt of the misconceptions of the Roosevelt policies and the antagonism to them of many people of high standing. Hence, I can tell you that your sound ideas in the great field in which you serve and your forthright expression of them give those who have served as I did, a high degree of satisfaction. They give us considerable encourage ment, too, in contending on our level against persons who, having had their positions and fortunes saved and safeguarded by the Roosevelt Administration, have since been foreseeing and predicting dire calamity because of what his Administration has done in behalf of the less fortunate. With best wishes, I am December 3> 1947. Mr. H. P. Drought, Frost sank Building, ban Antonio 5> Texas. Dear Mr. Drought: iill too rarely I receive letters like yours of November <.0, which is most heartening and therefore greatiy appreciated. One always wonders whether in presenting a case it has been worth while or whether it has been sufficiently effective to make any dent on the audience. .hs you know, that usually depends on the prejudices and emotions of the group, and usually only a very small minority has the advance understanding, as you have, to be receptive. I thought your parallel about the banker exhausting a customer's resources in order, to make him eligible for a loan was especially apt. *nd I shall take the liberty of borrowing that idea when discussing tne subject in the future. I was also impressed by your feeling, which 1 share, about those critics of the iioosevelt administration whose positions and fortunes were salvaged but who remained im- . placably blind to the fact that their salvation depended so greatly on what the administration did for the less fortunate. I was very glad to h a v e an opportunity to meet you and I wish to take this occasion to reciprocate most heartily your good wishes. bincerely yours, M. b, Eccles, Cnairaan. ET:b Frank L . M cN e n y DALLAS November 26, 1947 Honorable Marriner Eccles Federal Reserve Board Washington, D. C, Dear Mr, Eccles: I have been out of the City practically ever since your visit here. Will you please aocept belated congratulations on the magnificent address you made on that occasion. FLMcthk December 8, 1947* Dear Mr. McNeny: It was very thoughtful of you to send me your encouraging note of November kb, and I just wanted to let you know I appreciated it. Sincerely yours, Mr. Frank L. MciMeny, Dallas, Texas. Iff: b BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM December 5# 19U7* Mr. Morrill FROM Mr, Thurston The Chairman paged you a couple of nights ago not knowing that you were laid up with a cold. But what he wanted v/as to pass on to you some of the avalanche of correspondence for your expert touch. Accordingly, I am carefully selecting some of the toughest ones, such as the attached from National Bank Examiner Hawkins. E.T. TREASURY DEPARTM ENT OFFICE OF COMPTROLLER OF THE CURRENCY CafttONAL BANK EXAMINER Post Office Box 1193 Austin, Texas November 29, 1947 Hon. Marriner S. Eccles, Chairman Board of Governors The Federal Reserve System Washington, D. C. Dear Mr. Eccles: It was a great pleasure to have the opportunity of meeting you and hearing your address at the dinner recently in Dallas. Also, I have just completed the reading of your re.commendations to Congress. ^ You will know from our past correspondence, that your beliefs and mine run along the same or similar lines. Like you, I have no interest in the anti-infla tionary movements only the common good of our country. You will remember that following your address, I asked you a question and at the same time asked that you not answer it. No one heard me ask the question; it was while you were op the way out from the Texas Room at the Baker Hotel. He/is the question again, but I do not expect that you comment on it now as it is too late to effect such a matter, probably not practicable to do so. If the banks owed £he Federal Reserve System $12 billion to $15 billion and were carrying |15 billion to $18 billion of the debt now carried by the System, would their loan and investment policies be less inflationary? I think so. Federal Reserve credit for reserve purposes, coming into the banks as deposits, is far more inflationary than funds lent to the banks by the System. It is my belief that your proposed special reserves would be anti-inflation ary and probably cause the banks to stop making loans and in vestments which are inflationary. About four or five years ago I discussed the matter with Mr. Gilbert. Please have sent to me your printed recommendations for last year and the current year. I desire to study more the special reserve provisions. Also, please send a copy of your recent recommendations to the Congress if they are printed and available. TSincerely yovuns \J. W. HAWKINS (National Bank Examiner) December 16, 1947* Mr. J. lit. Hawkins, Post Uffice Box 1193> Austin, Texas. Dear Mr. Hawkins: I regret that I have been unable to acknowledge at an earlier date the receipt of your letter of November 29, 1947 with reference to my talk at the dinner in Dallas. nhile I note that you read the news reports of the rec ommendations that I submitted recently in hearings before Congressional committees, tnese reports were probably very brief. In accordance with your request, I take pleasure in sending you a reprint of my statement before the Joint Committee on the Economic report on November k5, 1947* Your hypothetical question, whether the loan and investment policies of the banks would be less inflationary if they owed the Federal Reserve System' fylk Dillioh to.$15 billion and were carrying $15 billion to $18 billion of the debt now carried by the bystem, assumes that the federal Reserve canks might in a relatively short period sell $15 to $18 M 3 Ji nn dollars of their present holdings and that at the same time the banks might borrow from $12 to $15 billion dollars fj*om the federal fteserve *>anks. Such an operation would mean abandonment of the policy of maintaining the market for Government securities and could only be ac complished at the risk of catastrophic effects upon the long-term Government bond market. You are aware, I am sure, of the antipathy of banks toward borrowing from Federal Re serve tfanks, especially in such enormous amounts. The pro posal which I have submitted to the Congressional committees would accomplish some restraint without any such disruptive effects upon the Government bond market. Very sincerely yours, M. o, Eccles, Chairman. Enclosure CM: am FED ER AL R E SE R V E BANK OF D ALLAS G ILBE R T December 1, 19^7 P R E S ID E N T Mr. Marriner S. Eccles, Chairman Board of Governors of the Federal Reserve System Washington, D. C. Dear Governor Eccles: I am sending you, under separate cover, a photograph of the group of bankers and businessmen who attended the dinner given in your honor by this bank on Friday evening, November lit5 also, a list of the individuals who were invited to the dinner, as well as a list of those who were present. Our directors and I are most grateful to you for coining to Dallas to attend our joint board meeting and our dinner meet ing, and for the most interesting talks you made at those meetings* Following the meetings I received several letters from our branch directors, and a number of letters and phone calls from local bankers and businessmen, all expressing their appreciation of the opportunity to hear your discussions, some of them indicating their approval of several of the points you developed in your talks* I am sure you realized long ago that, generally speaking, the bankers of the country are opposed to the special reserve plan. With one or two exceptions, the bankers of this district with whom I have discussed the matter are very much opposed to the idea. For some un known reason, they seem to be more concerned about the possible national isation or socialization of banking in this country than they are about a further inflationary boom followed by a bust, and to feel that the adoption of the proposed special reserve plan would be the first step toward nationalization or socialization of the commercial banking system. Both personally and officially I sincerely appreciate your visit, not only because it was nice to have you in Dallas, but because you made our joint board meeting and our dinner meeting outstanding affairs, and because I know it was terribly difficult for you to be away from Washington just prior to the opening of the special session of Congress. I hope that your next visit will not be too long delayed, and that at that time you may be able to spend a day or two here play ing golf and relaxing completely. I am looking forward with pleasure to seeing you in Washington next Monday and Tuesday, ITith best regards and all good wishes, I am, Sincerely yours, R. R. Gilbert President December 9, i9A7« Mr. h. it. Gilbert, President, Federal Reserve sank ol‘wallas, Dallas 13, iexas. Dear handle: I am sorry that I have not been able to acknowl edge sooner your very thoughtful letter of December 1^ 1947 in regard to my recent ^isit to Dallas, because of the demands upon my time for appearances before Congress ional Committees and for the preparation of the material to be submitted. In the meantime, I have had the pleasure of seeing you at the meetings of the Presidents conference and the Federal Open Market Committee, and I assume that you have read copies of the program which I outlined in the course of the hearings. Therefore, you have fuller opportunity to think over these matters than was possible at the time of my visit and I have no doubt that more discussion of the proposals has taken place in your dis trict than would have been tne case ordinarily. *gain I wish to thank you for the opportunity of explaining my point of view more thoroughly by word of mouth at Dallas than would have been possible merely through the printed word. Most sincerely yours, M. CM: am Eccles, Chairman.
@FedFRASER