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FEDER.A.L RESERVE BOARD
STATEMENT FOR THE PRESS
X-1591
For immediate release Friday. June 20, 1919.
The Federal Reserve Board had today a conference with the executive
committee of the Federal Advisory Council {Mr. James B. Forgan of Chicago,
Mr~
L.
L~
Rue of Philadelphia, Mr. Daniel G. Wing of Boston and Mt.
w.
s.
Rowe of Cincinnati) to consider problems relating to the financing of the
foreign trade of the United
states~
There wa.s discussion as to what unusual features attached to this
trade and the bearing thereof upon the American banking situation.
The
Board and the Committee of the council were in entire accord that the
~tter
of providing long term advances for Europe presented an investment rather
than a banking problem and t W.t the necessary funds must therefore come from
the investment market.
It was, however, the opinion of the conference that
as a step towards supporting plans for
~he
firancing of our foreign trade it
would be well to add a new pa.ragra.ph to Section 25 of the Federal Reserve Act
so a.s to permit National banks until January 1, 1921, without regard to
the amil\unt of their capital and sur:plus, to invest not exceeding in the
aggregate five per centum of thdr capital and surplus in the stock of one
or more corporations principally
eng~ged
in such phases of international or
foreign financial operations as may be necessary to facilitate the e .xport
of goods from the United States.
legislation to congress.
The
Board voted to recommend this
@FedFRASER