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853 8X OFFICIO MBMBBtfcS W, P . 6 . H A R D I N G , GOVERNOR A L B E R T S T R A U S S , VICE GOVERNOR DAVID F . H O U S T O N SECRETARY OF THE ADOLPH C. MILLER TREASURY C H A R L E S S . HAMLIN CHAIRMAN J O H N SKELTON WILLIAMS COMPTROLLER OF THE CURRENCY FEDERAL RESERVE BOARD HENRY A. L&EHCTNPAH W . T . C H A P M A N , SECRETARY A D D R E S S REPLY TO FEDERAL RESERVE BOARD WASHINGTON R . G . E M E R S O N , ASSISTANT SECRETARY W . M . IMLAY, FISCAL AOENT Septeniber 22,1920. X-201} Dear Sir: There are. e n c l o s e d h e r e w i t h copies of c o n f i d e n t i a l i n s t r u c t i o n s i s s u e d by the S e c r e t a r y of t h e Treasury under d a t e of August 3 0 t h , 1920, with r e s p e c t to Federal Reserve Banks, making exchanges, replacements and redemptions of United S t a t e s paper c u r r e n c y . The f e d e r a l Reserve Board understands from p r e v i o u s communicat i o n s t h a t sfoiir hank i s i n a p o s i t i o n t o take oveir the a d d i t i o n a l f u n c t i o n s iinmediately. Kiiidly a d v i s e the Board of the e x a c t d a t e as soon as determined when your bank w i l l commence t h e s e riew c u r r e n c y o p e r a t i o n s i n order t h a t t h e T r e a s u r e r cf t h e United S t a t e s and A s s i s t a n t T r e a s u r e r s concerned may be n o t i f i e d . The S e c r e t a r y of t h e Treasury has a u t h o r i z e d the f o l l o w i n g s t a t e m e n t by him to be used by F e d e r a l Reserve Banks i n making t h e i r announcements of t h e assumption of t h e s e new o p e r a t i o n s i n United S t a t e s paper c u r r e n c y , t o banking i n s t i t u t i o n s i n t h e i r F e d e r a l Reserve D i s t r i c t s t o g e t h e r witfr such l o c a l statement of r e g u l a t i o n s as may be necessary: " In a n t i c i p a t i o n of the d i s c o n t i n u a n c e of the s e v e r a l s u b - t r e a s u r i e s p r i o r t o June 30, n e x t , as d i r e c t e d by r e c e n t l e g i s l a t i o n , the S e c r e t a r y of the Treasury has a u t h o r i z e d and i n s t r u c t e d I n d e r a l Reserve Banks, as f a c i l i t i e s a r e p r e s e n t , t o undertake exchanges and replacement .of United S t a t e s p a p e r c u r r e n c y . 4nd f u r t h e r , i n o r d e r t o f u r n i s h improved f a c i l i t i e s f o r t h e p u b l i c and i n order t o e s t a b l i s h as e q u i t a b l e a d i s t r i b u t i o n a s p o s s i b l e of United S t a t e s paper c u r r e n c y f i t f o r c i r c u l a t i o n , the S e c r e t a r y h a s d i r e c t e d the T r e a s u r e r of t h e United S t a t e s h e r e a f t e r n o t t o make d i r e c t shipments of c u r r e n c y f i t x-2013 —2~f f o r c i r c u l a t i o n t o r e m i t t i n g banks ; b u t to t r a n s m i t a c r e d i t t o the a p p r o p r i a t e Federal Reserve Bank, which bank s h a l l make appropriate shipment. I t i s b e l i e v e d t h i s procedure w i l l r e s u l t i n improving the general s i t u a t i o n throughout the United S t a t e s n o t only with respect t o the c o n d i t i o n of the paper currency, b u t with r e s p e c t t o the s h o r t age of n o t e s of small denominations now e x i s t i n g i n many s e c t i o n s of the country*" Very t r u l y yours, Governor. Enclosure. To Chairmen of a l l P.R. Banks EXCEPT RICHMOND CHICAGO j m DALLAS,
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