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August 21, Chairman Eccles U Ik fiver I called Mr. Spreul regarding the Treasury1 • refunding off«r. H« s t i l l prefers the plan as originally proposed in the Executive Con-.itteo laenoraudxat. He s&id further that if the Treasury wishes to refund the October certificates into a new issue of certificates he would prefer to refund the September lp notes into an additional issue of 1 1/1+ per cent notes at 100 U//32* lie favors this position on the grounds that the market demand is in this area rather whan in the area of the Mirth 19*4*S riot#© and that i t t?ould serve to exteiwi 3o»e of the Treasury's short-term xaaturitios. I told him your position in the matter and he fait that banks -were nor exterding maturities of their own &coord because of the existence of the pattern of rates and that a refunding into 1 1/1; per cent notes would be of small iaportaiice as compared with what the taMtiel are xlraady doing. 1 reported to Kr. Bell both your point of view and that of Mr* Sproul. He said that i f he heard nothing further fros us on the natter today he would go ahead on the basis of refunding the September notes into the March 1<&6 notes. http://fraser.stlouisfed.org/ Federal Reserve DiPtlel Bank of St. Louis
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