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KBO'D 3K FUJSS SECZTJ AUG1 51942 THE MUTUAL BENEFIT LIFE INSURANCE COMPAKY" NEWARK, "NEW J E R S E Y AGENCY DEPARTMENT H. G. KENAGY SUPERINTENDENT OF AGENCIES G. FRANKLIN REAM F. D. HASELTON B. C.THURMAN ASST. SUPERINTENDENTS OF AGENCIES A . W. KISSAM ASSISTANT SECRETARY August 12, 1942 MILDRED F. STONE Mr. Marriner S. Eccles, Chairman, Federal Reserve System, Washington, D. C. Dear Mr, Eccles: Last May you addressed a letter to Senator Danaher on the subject of the anti-inflationary effect of the payment by individuals of life insurance premiums. Your letter has been widely circulated among the life insurance people of this country. You may be interested to see in the enclosed copy of a Company leaflet how we spread your message to almost for hundred thousand policyholders • Your message brought forth a splendid response from our field representatives. It gave them courage to know that national leaders like yourself appreciate the value of our business. It gave them new enthusiasm to pursue their work as an important part of the war effort. On behalf of thousand of life insurance men and women, I want to thank you. Sincerely yours, HGK:P * T U A L B E N E F I T LIFE INSURANCE IN THE WAR EFFORT V members will also find much satisfaction in the part their company is taking, along with others, in furthering the total, national war effort. The dollars you put into premiums help you and your country in three ways: 1. Life insurance dollars helpfinancethe war —-through the direct purchase of government bonds and through investment in the bonds of companies that make and transport vital war materials. Last Published for Mutual Benefit Policyholders year the Mutual BeneD . D A Y ,G E N E R A L A G E N T fit invested more 744 BROAD STREET, NEWARK, N. J. money in government I put more money into life insurance or o should I put every possible dollar into war onds?" "What part are the life insurance companies taking in the war effort?" These are but two questions which men and women arc asking themselves today. In finding the answers, Mutual Benefit policyholder"SHOULD (Continued on back page) AGA/NSr /UFLAT/ON MARRINER S. ECCLES Chairman, the Federal Reserve System I feel that next to the purchase of Government Savings and War Bonds and Stamps by the public, investment in life insurance is particularly to be encouraged at this time. AUGl 51942 BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEI* WASHINGTON May U» Honorable John A. Danaher, United States Senate, Washington, D. C. « p^.D< Dear Senator Danaher: I am in receipt of your letter of April 29 concerning the communication you received from Mr. John M. Laird, President of the Actuarial Society of America, as to the anti-inflationary effect of the payment by individuals of life insurance premiums. You and I are in full agreement, of course, that all proper steps must be taken to prevent a runaway price situation and that to this end a complete and comprehensive attack must be made on all fronts against inflationary forces. As I have frequently stated, this is the time to save, not to spend, money. This is the time to get out of, not into, debt. No form of saving is as timely and effective as the purchase by our citizens of Government Savings and War Bonds. Savings out of current income when thus invested help finance the war, are diverted from the market place where they tend to bid up prices of the shrinking supply of civilian goods, and are a store of future purchasing power which will be needed and can be spent without inflationary consequences after the war. Insurance companies are large investors in Government securities so that the bulk of savings put into the insurance companies in the form of premiums thus help in financing the war. Likewise, investment in life insurance serves to divert funds from consumer markets and thus to reduce inflationary pressures. And, of course, insurance is a store of future protection for the beneficiaries of insurance policies. Accordingly, I feel that next to the purohase of Government Savings and War Bonds and Stamps by the public, investment in life insurance is particularly to be encouraged at this time. You are at liberty to pass along this letter to Mr. Laird if you wish to do so. Sincerely y, M. S. Ecoles, Chairman. M U T U A L B E N E F I T L I F Published Quarterly - Copyright 1942 THE MUTUAL BENEFIT LIFE INSURANCE COMPANY • Organized 1845 • NEWARK, JULY 1942 (Continued from first page) bonds than it received during the year in new premiums. Approximately 20% of its assets are directly invested in government securities. 2. Life insurance dollars arc anti-inflationary. Every dollar saved today helps check the threat of inflation and builds a reserve which will cushion the shock of any deflation which may follow the war. 3. Life insurance dollars arc dollars for family security. The strength of America is the sum of (he strength of its individual families. Life insurance helps guarantee family security at a time when it is vital to the nation. The Minneapolis Tribune had this to say in a recent editorial: "There is no sounder investment for individuals of moderate means than life insurance, and no more resilient cushion to take the postwar shocks than this form of voluntary saving. This is recognized in our compulsory social se- curity program, which should be supplemented by every incentive to voluntary security investment. The battle that we must wage lgainsi inflation can be fought with no greater assu ; ance of success than by utilizing our excess national income for the payment of our personal debts and the increase of our life insurance protection. "Money expended for these purposes has no inflationary effect, for to a very large extent it flows back into the federal treasury to purchase government securities. Forty-two per cent of insurance investment in the first two months [of 1942] was for government bonds. Life insurance companies are playing an important part in our war financing, in that they are takingissues which if wholly absorbed by the commercial banks, would make for an inflation of bank credit . . . "It is hard to conceive of any stronger buttress to our social structure than a wide diffusion of life insurance policies in the moderate income groups which now are the chief beneficiaries of our dangerously expanding national income. It is hardly necessary to set forth the advantages that accrue to the individual and his family from life insurance, for the American people are aware of them, but the anti-inflatio: effects arc not so generally recognized." o L. D. DAY G E N E R A L 7 4 4 B R O A D N E W A R K , A G E N T S T R E E T N . J . EfiC!Q EN FTUB3 A U G 1 54942 August H , 1942. Mr, H. 0* Kenagy, Superintendent of Agencies, The Mutual Benefit Life Insurance Company, Kewark, Sew Jersey. Dear Mr. Kenagys Mr, Iccles has asked me to reply to yours of August 12, 1942, v&th which you enclosed copy of the Insert which has evidently been used in your agencies* operations, this insert containing, aaong other things, a facsimile of Mr* Eccles* letter of Hay 4» 1942, to Senator Banaher, cementing on the desirability of the payment by individuals of life insurance prewiuae as an anti-inflationary factor. Wr* Eccles is glad to note your cospliaentary references to his letter to Senator Danaher, and is gratified that you feel it has been productive of good results* Very truly yours, (Signed) Lawrence Clayton Assistant to the Chairman. LC:jg
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