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. /'' fey 1, 19.5. Mr. The 225 Hew §« C. l e a d , c c t / r y , M rchtnts 1 A.. .?ocifition of Hew York, Broadway, Woolworth 3 u i l d i n g , York, Bur Tork. Leer Mr. l?edt This w i l l acknowledge your l e t t e r of April fcbth, conveying to •e the views of the4 M. rchants fllf «1at1on oi IT on th« Bfcnk B i l l of 1955, to p with a BtfttflMBt o, rtttOM for . uch riewc formulated by four Special Co c i i t t e e . You have ao.;i t l - . t coraunice* to Mr. Crowl:-y your wtrnn concernin T i t l e I of tfet B i l l , M I f t e l l fl ay rems T i t l e I I . I pro;)-; t to takt- XXJ your . j - c i i c to tl; p M l « f b i l l in tlM on.er in . they a n enumtrin th< r- port of yo^jr conaiitt 1 . Combination o: UM board in MkCh Fsdcrrl ft«i be appointee by tilt boerc^ of UM I Be.-:- . lou obj et tin t nd independent expreesloa of 1 , Ir chairman OJ th Lncuaibvn* of .uch I to : > . ;• J ci • . ;ich a po'-l. ion vou- a 4.1 . pr: ctic::l ;ominrrice over \ jerve baoks« I ctr. i. 1\ ir: I view. In st ; - '• trailt • - ion thv b: Mki have al A role n ,?e prop,.s« to increa. ioiay in t > ct» At present Reserre Board appoints 111 tor , • of *hori I chaiim-n of th? board, o . nw '•• - . - i . . . T:. trt npt 4 ar: K>t I Wf . I i J -O I . nil I wrflil thf power of aopoi:. UM c h a i r s - a , that th « '.r ctor • ., ' i in r t t V I for t of power of appoint^Mlt ) ?v 1 •_ appoln . tkrat j - . . The v rors ??ill be appoint d i .•: i l l be ? . Mr. 8 , C. Mead force hny person on a reserve b&nk aa ^OY rnor who l l n<i c >table to t.v. l o e t l board oi' director,;. Th na-ab- r o aaab n aj raafc boards c'irrctly u ^pointed ty tMe fedoral !; | ;v BotH wil educocJ to twoj OBd potMiibly out (in aaoot whcro the v "ior i s al*;o a Cla.ri:- C c^r c t o r ) , We feel t > refore that in nu:tt« rr of rogion* a l co tc rn ti < i^-s^-m INftk*will be even mor? independent of the Board then th*..y have. be*in in tne past* So fi tempting to centra 11 ; a l l mat to bt.n'ci'i in i i9 we ere 1 i oapotorod * • o t t r. to ii;. r.prfBMitfc ivnk, * i n l y for t h t purpo. o; board to delegate to the r» B HJO b^nkc c^rtfin (hit if. o em; l o t 1 i :e bo&rd. oiibli t« To-^r co::iaitt<:e believes thr.t i t woul 1 to rem v the S i •/ of t ' . Coojytroll . o. UM Gurroao I ( the Feder pvi Borrd. I Jo not feel th&t i t i . cp no rri «e t o Clii;CU BUitt-r. 5, loar co'ijalttee object,, to % > > 1 t o oon : Boai'd pover to ehi i rf ro<m1 roai I o ia m; • y oi . gro . • '* . r i1 M B I Of l a i to a jolitiO' l l y Qomlm " . I i tr r to ^ rv. Jiremfr'it/- i. ;n iniitrusi nt oi o l •: a* , Ilk : t 01 r tr>nB.n> -> eontrol^ i t cen d ior deslr ble or omdoolroi purposea, I iiall, in a monaent, o^ocribe to ,;ou t to bu iat i t will be ust'd in J.:. m l i e int r ^ t . 4» Yo ir cojaBlttoe o= I p o/i io • on v : gro 1 . la t:i £ l i j i It 1 " • • t • • most I09 * •. factor in awiny of tb |JL: i^i-' 'r'• Actually the extent to vhieb rool ' • lo- a Bontrlb I o our boakloi -iifiCUI'JU. h? been gro^cly cxa g are ted. k ctu:y j u s t cote 1 Isclc. J.11 national baaka thi t re eugp .. -re lj'r.0-^, Lnc Lv< , loan; on re-el e s t a t e c^ :• ily 10,£ per c of total loin ta ta .ntw inm-ci I 1* prior to . e» eTea if a l l 0: tfeat* re.'.l la PO bee d not have suep. ndt?d i i t h e i r oth.;,r lo&n.; wore a l l souad« It o lt.; appear to be a thir iaf r nee that in thfi c&;:.. of n ,io:i<-1 bin'- f a i l u r e s , which by •oaati ooaavlaoi about one-third of a l l f a i l u r e s , factor* o 1 ttaafl bad r e a l e s t e t e loan.- were dominant, low coooAttoo <'.l 0 0 j e t s to the real estate provi.iom on the ground thct r e a l estfe •- laaau , tak n in conjunction with othfr sections of the b i l l , co lei or r e d i s count &t thi IoaPIfo baafca, Th-- propor: 1 i not to •£&. re&l oot< t e loane with long aaturltiao e l i i b l e for rodlioouttt at the u n t i l maturity but to a&k«! thea e l i i b l e ai c o l l teral for a 1 nk a # t a # | which - i l l of oouraa h&\ rltloa« RM dsci. ion t> to whether tiie a^tet. 0 oollat ral ttri OOV to wh MT rango to UM Boabor ! 1 'llf will kdivi . B« Mr, ft. C. Head I p . htt /our co^aitt e It exift . . ic. ; ailitatin ance by t abl> to r c Iv MI a. 3 th*t the prc?£ . • or t *aptint- to rrraov. this reluctil ____;_ 1; will be t h - i r loc: 1 r I rve banki in ci ;,. of 5. Tht Op^-n M'-rkct Co:..aitt_. the p.ropo^;i i.i Uv b i l l 1 more to n/ ^^ pi a atarj *< y . i t vo p NMltt I »bjee1 b •/• n L-i ! op n-« ' >olic/ af t: r havir»,L co a coKBlttte o. i-ve beak . In ! r to u . • 1 It . essfcry to Md rvt^nd the present adrain 1 t-up wit .. op ratj . o ' a i t t -' .t t (. tlist ttv . it op.n-sii • i tee li Gciriso 1 1 M law now t't&nde th -.. t Qoaod t If Charged w% i i i . y of i a i t i & t l n g r -jo-am nn . F«dt.r . Xy t h e powr?r t o app w dlsa 1 > .u .. . , • turn ve b*inka indi 1 1 ly htve the power to participate or aot in 1 Ions re-coraaendf.d by the comlttet &ad approved by . A t Ufc ^restnt tlM ther'.fo-e 1 i reap . _ LH1 or ae)ee>Nearket eperetloni u . by 14 botdee eoaprle* ing 128 ffltn. Bfl I d by the Prt , soae ar« e l 8 by the btn:.., a r e appointed by v , . } 4 , appointee . • . o r . ot '.-. . . With .'Uch an org i t i: alaoot ia .0, i 1 to piece defislt tlltj :.ny.-.v: TU» I •- th/1 the stabcri 0 eMHlttee would ize I ouch e iyeteB| as a p j l i ^ to 1, »rictic iolny. I ' as to agree with oo on thifi I . retive point of • flaatiMI of authority I ?aell is 11 iOttti whether t h i . Id be a public :. ev |#ped eBder 0 or» •etttj or & privrtf b#ej# Hhftti thi I think i t acaiUi of only MM anaw^ r , A be ecoaoaic wellv rj > r. 01 In ttM co'iaunity -.1 raanner subj ct to public co.trol, . K, a fhil© recognising the fi ct tiia4. the dch hso authority "• : >OT L llit> for UM •••'•-*- nela tiaa wl n: tio i i BO 4 . / polici* «ust be a public booy# ?*« hav« eought to i i i ay will not b<: tctiTated by ptrtlaan .To t id we ht. 8ou,.nt to l ' neat Iff o: N by | -i i t roth author! 1 i i l i t y . The enh.net >z... tlge and the n. v > o K> Lag iLl f i t l i ho.» , Le the B I m I P • 11 1 • Ee h«iV€ . 4. :.ae > 3 aix • peaii hi , . / .r co iltt^e coon LU in t • rtlcular* I /f i. I*i * :. A i t o v c* li i looking toward I I &ojni a- , will in I . '!'• 1 / i \ ri,slt' .L 1 to use •• for pttrpOJ - ii t It I int. n a .„.- L*«f par .1 I-. .1- 1 la U t t l u. p l . : ; v thi t . . . • . , n o p n Lo • , , 1MB 10 I a £ctiv I bgr uch airne w i l l eni o yolivj | :lly the a cettiity of ch ng ia t a, I M l .iy. 1; K o: J c ' i o . to t Dim fill,;; s i c n M'trr UM pr#i ftt " i l l , vhich • Mil i l t l urgent cwittr. , h I ^o«a «IF . annj b . t been f bodl< - la v. ; i l l now tcrtini la i | . + . re u u . i . ion ve I u h ft «or< l a d l : . ! , ; . K rtl j. b y TtJrl onin n^: lu n i i ; uch propOo<li for MHSpl^ c Om Huncr d P r e n t floclal .'icgregft MTIB beakla 4J1 n, th •ency b-nkia ., t l i ha at o 1 . - , ki p ^i I o .or . h 'hie :. • i"o . ini' — >1 n f the iking . • • •• / o r ti -s- i ve , In th Y , •• v- n' u 1 -Jni i icntsj • L-11 • :. i y. '•":. I objeot to pr« v- n t • : ii.y ' • i in i )1 rji boom. r Having r • B i l l b- i o • I : •• . I • t »f I to I htve urged for i ai cta-nt o: the b i l l t ticit i n I i4 r cov ry » -. futur« st«- i l i -y of N .net.s end ctaployacnt. I &• &en ^ in." of ay Xmt timony. I am c iiooc •—tioaa of Mi ' I 1 thftt have arouaed the a o s t controv.r to me fcamt c nn • I n JOIV. c. by fart] atu..y. Ou • i>ljT.-r«OMi i r l n aan c nnot b# Mr. B« C« lload c l e t r . u up by the aecuiaulistio > : tj :a . c t u i l in io • than *e hove u.t present* Th tflttMl LapL 1 r-cut totiay M they would be . i"t r y«>; o:' 1 J . t:ii y. I c* unot ther fore re; Lli I li ion at; oth r IfcNI A cevice to oeL'y thi a:u ctavtit of If which are urgently a^t-d cl. a t -ime. Sincerely y , M. l« hccloe Gov
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