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December 27, 1958. MEMORANDUM: TO - Mr. Corcoran FROM - Chairman Eccles The attached is the copy of the suggestion for the budget message which I just read to you over the telephone. Attachment December 2£, 1958. My dear Sir. President: In accordance with the •ftwrnrorxiili I discussed with you at Hara Springs with regard to procedure for dealing with the banking situation, X am enclosing & paragraph that you aight use as the basis for a reference to this important subject in your message to Congress, As I said when I was at Warn Springs, I feel that it would be a great mistake to present to Congress a bill to deal with th© better coordination and further strengthening of the banking system which is urgently needed, I feel that the Board would be remiss if it did not report to Congress the facts as to the present improved but still highly unsatisfactory situation. It seems to aie, therefore, that it is highly desirable to have you suggest to Congress the desirability of dealing further, as Congress aay see fit, with the existing problems. X should not like to have any impression created by your failure to mention the subject that X had been delinquent in advising you or that there was a difference of opinion as to whether further steps needed to be taken at this time, especially in connection with the termination of the banking holiday. I would very such like to see you put squarely up to Congress the responsibility for acting or failing to act not oaly in improving the present unsatisfactory setup with respect to Federal banking supervision, but in providing authority to deal with such emergencies as aay arise in the future which we are in no position now to cope with adequately. Respectfully yours, M. S. Socles, Chairman. The Honorable The President of the United States, The White House. Rehabilitation of the American banking systemf which has been brought about since the declaration of the bank holiday by Presidential proclamation on March 6, 1955, has been a notable achievement in which both the Congress and. the Executive can justly take pride. The proclamation has remained in effect but, la view of national recovery and of the great improvement In the condition of our banksf I feel that it ^ould be appropriate to remove the restrictions of the bank holiday. In considering the termination of the bank holiday, I would like to suggest that the Congress, through approoriate committees or through a joint committee specially naraed for that puroose, undertake a review of Federal banking statutes and a careful study of our banking system and of the agencies established by the Federal Government to supervlse and regulate banking. Such a study will disclose what additional legislation • -esirable in order to strengthen still further the banking system, so that it will bt fortified as completely as possible to meet changing economic conditions and to meet adequately the credit needs of commerce, agriculture and industry, while protecting the rights of bank depositors and the oublic interest.