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CH ARLES S Ex Officio Members H A M L IN F R E D E R IC A PAULM W I L L IA M S M cA D O O SECRETARY OF THE TREASURY W P G GOVERNOR D E L A N O V IC E GOVERNOR W ARBURG H A R D IN G AD O LPH C M IL L E R CHAIRMAN J O H N S K E L T O N W IL L IA M S COMPTROLLER OF THE CURRENCY H FEDERAL RESERVE B O A R D P A R K E R W lC E fN jQ E C R E T A R Y S H E R M A N A L L E ll'iU S T SECRE1 ■88 REPLY TO WASHINGTON FEDERAL RESERVE BOARD October 8, 1915* Sir: The tiuestion l.c*s been raised whether Feaeral Reserve Banks may, under the provisions of Section 14 of the Federal Reserve Act, purchase single name paper m the open market• Section 14 provides m part that "Any Federal Reserve Bank may, under rules and regulations prescribed by the Federal Reserve Board, pur chase and sell m the open market, at home or abroad, either from or to domestic or foreign banks, firms, cor porations, or individuals, cable transfers, and bankers' acceptances and oills of exchange of the kinds and matur ities by this Act made eligible for rediscount, with or /ithout the indorsement of a member bank"* Under the provisions of this Section a Federal Roserve Bank may purchase bills bf exchange (that is, orders drawn by one person on another to pay on demand, or at a fixed or determinable future time, a sum certain m money to order or to bearer), whether before or after acceptance, provided, they are of the kinds and maturities made eligible for redis count under Section 13• It is clear, however, that promissory notes as distinguished from bills of exchange are not eligible for pur chase under Section 14 irrespective of the number of names thereon. Respectfully, C. Elliott, Counsel. Hon. Charles S. Hamlin, Governor•
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