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Reproduced from the Unclassified I Declassified Holdings of the National Archives ELEGPAM F o r m 40 FE D E R A Ii :V'.* R E S i« v c .;; ' A S H I N Q T q U L . ! S® IM W N * !***** ( i U m f lr t y » h w M l r 4 U u> a ln ^ t lM i it# p «* t u w . Tm v n n m i U « »t«* t *mmn4 rt«r* tttfitr pawsatt *»« m m « M C gcct* tta t y*o t « * e P i * * a t t U m o f UnWMM « « M p * a w M ( m ***• In m%m, Hm— tfi*** At <mko wither ftM . *IU r*ti«»r* «Btor«MiHrt nut wir« I f ?»n w U l tMrc H»#« ftt Usr*» wXt f l w « t filth* r* t* . < U A M jL tb a O F F I C I A L B U S IN E S S G O V ER N M EN T R ATES http://fraser.stlouisfed.org/ C harge Fed er al R eserve 7729 Federal Reserve Bank of St.2— Louis Board Reproduced from the Unclassified I Declassified Holdings of the National Archives Form 1201 CLASS O F S ER V IC E SYM BO L Day Message Day Letter Blue Night Message Nite NL Night Letter If none of these three symbols appears after the check (number of words)this is a day message. Other wise its character is indicated by the symbol appearing after the check. WESTE TEL NEWCOMB C AR LTO N , PRES ID ENT UNION AM G EORGE W. E. A T K IN S , fir s t vic e-p re sid e n t RECEIVED AT WYATT BUILDING, COR. 14TH AND F STS., WASHINGTON, D. C. 'SB ? C U S S O F S E R V IC E SYM BOL Day Message Day Letter Blue Night Message Nity N L Night Letter If none of these three symbols appears after the check (number of words) this isa day message. Other wise its character is indicated by the symbol appearing after the check. r/- MSCH CF 53C0LLECT GR SU r.il.NuEAPOLIS MIMK 413P.SBB ATim HAfiDING FED r.ESERVE BOA ttW^IMGTOr! WE m t SE GLAD TO TAKE JlVE MILLION OF ACCEPTANCE FROM BOSTON WITHOUT THEIR ENDORSEMENT AT RATE NAMED IS YOUR MESSAGE OF EVEN DATE THE ACCEPTANCES TO BE OF SUCK CHARACTER AS X!Z 0$?rOFO?£ AUTHORIZE THE!.: TO PURCHASE FOR OUR iCCffOUNT ARE WIRING THEM V/CLF GOVERNORS •540Pf4 , Reproduced from the Unclassified I Declassified Holdings of the National Archives F E D E R A L R E S E R V E B/VNKOF MI N N E A P O L I S NINTH / D I S T R I CT OFFICERS THEODORE W O L D ,g o v e rn o r S . S , C O O K . , CA S DIRECTORS JOHN H . R! CH, c h a i r m a n A ND FEDERAL R ES ERVE AGE NT P. M, KER S T , v i c e c h a i r m a n ANP DEPUTY FEDERAL RESf e R V E AC J . C. B A S S E T T , A B E R D E E N , S . D A K , E ,W, D E C K E R , M IN N E A P O L IS ,M I N N. F . R, BIGELOW, ST. R A U L , M IN N E S O T A L.B . HANNA, F A R Q O , n . d a h o t a JOHN W. BLACK, H O U G H T O N , M I C H . F. P , HIXON,LA C R O S S E , W I S C O N S I N N .B .H O L T E R ,h e l e n a ,m o n t. December 21,1915. Mr. Paul M. Warburg, C/o Federal Reserve Board, Washington,D.C. Dear Mr. Warburg: / Your favor of the 17th/in response to my letter of the 15th"Relative to bills of exchange covering shipments of commodities, commonly known as bill of lading drafts, is at hand. I will be prepared to show you, when I attend the next conference in January, a bill as we get them, and go over the matter with you at that time. Sincerely /ours, w # December X?, 1915. Dear Governor Wold: I have your letter of December fifteenth,! in which you in* quire about bills of exchange payable on arrival, secured by bills of lading. Tour question is: "Will not the agreement from the member bank, if an indorser, or from drawer, if purchased in the open aarket, to pay the bill if remaining outstanding longer than 60 days, give the bill a definite maturity, as required by the regulation?* 1 am oertaln 1 aa voicing the sentiments of my colleagues when I say that we want to do all we can to find ways and means enabling you to purchase this kind of paper, which appears to be a very desirable investment for the Federal Reserve Banks. Kay I Inquire, before answering your question, on what basis a bill of this kind would be purchased? Could you send me a pro forma statement? The matter would be perfectly easy if the bill were dis counted or purchased from the indorser or drawer as a 60 day paper, or a shorter maturity if that were preferred, with the understanding that if paid earlier the discount for the unexplred term would be refunded, and if paid later that the number of days would be added to the discount charge. you a definite date. That would give But that under all and any circumstanoes ill# > i l X wait be paid wlt&in sixty day# * I &®li#ir# that jm ®an mtk out so&e p t-m tim l plaa m ob »©re readily tii.an I, beotu&e jm axe more faailiar witfe the habite of your <mftto«6?#* In tome way*, we should be able to wort out thla problem. WMn you write me again giving ae detail* and sug* gftfttltmft* I shall be glad to ta&# the matter before tb# Board. Very truly yours, Theodore Wold, Esq.* Governor, federal R e s e r v e Minneapolis, IlnnesO'ta* Reproduced from the Unclassified I Declassified Holdings of the National Archives F E D E R A L R E S E R V E B A N K OF M I N N E A P O L I S NINTH DISTRICT OFFICERS T H E O D O R E W O L D , SOVERNOR S ,S .C O O K , CASHIER r"; % J DIRECTORS JOHN H , R I C H , CH A IR M AN A N D F EDERAL R ES ERVE AGENT P . M . K E R S T , V I C E C HA I RM AN AND DEPUTY FEDERAL R E S E R V E A G E N T U . C,B AS S ETT, A B E R D E E N , S . D A K . E,W, DECK E R , M IN N E A P O L I S ,M I N N. F. R.BIGELOW, s t . pau L j M i n n e s o t a L.B.HA NNA, f a r o o , n . D a k o t a JOHN W. BLACK, H O U G H T O N , M I C H . F. P, HIXO N, LA C R O S S E,WISCONSIN N. B. HOLT ER, HE L E N A , MO NT. December 15,1915. Mr. Paul M. Warburg, Treasury Building, Washington,D.C. Dear Mr. Warburg: Since receiving Regulation T, Series of 1915, governing general open market operations, I have been wondering whether it could be made to apply to the handling of what is generally known as Bill of Lading drafts. Such Bills of Lading represent very largely shipments of flour, although at times, shipments of other non~perishable commodities. These bills of exchange are generally drawn payable upon arrival of the commodity, for as you know, it is quite impossible to determine just how long it takes a shipment of, say flour, from Minneapolis to reach Philadelphia or New York or some interior New England points. These, as you know, a^e a high class of self-liquidating instruments representing actual sale of an abfeaiute necessary of life, and if conditions should change so as to make it necessary for our friends to rediscount, that is practically the first thing they would dispose of, as Eastern banks are always willing to accept such items and give immediate credit at the lowest going rates. We have handled a few of such drafts for some interior banks, but ha.ve been requiring them to make the drafts payable ten days after date or on arrival, something that the millers, the drawers of the draft have objected to. At the same time we have required from the member bank an order in writing to charge their account with any drafts of this character rediscounted with us, that are outstanding for a period longer than sixty days. Some of these drafts are paid in seven or eight days, many in ten days, and when there is a congestion in railway service and the distance great, they have remained out standing as long as sixty days. I believe that these bills so drawn will meet fully with the provisions of Regulation T. What I would like to have you consider would be the advisability of authorizing us to purchase such drafts where they are payable upon arrival, with an agreement from the drawer or endorser, when coming from a bank, if not paid within 60 days, that drafts be taken up by them. Reproduced from the Unclassified I Declassified Holdings of the National Archives Although we do not anticipate any immediate call for funds on this character of bills, I thought it well to take the matter up with you in ample time, so we could act quickly if there was a change in conditions, and either procure these drafts in the open market, or when offered to us by member banks. The point in question and on which we ask you to pass is - Will not the agreement from the member bank, if an indorser, or from drawer, if purchased in the open market, to pay the bill if remaining outstanding longer than 60 days, give the bill a definite maturity, as required by the regulation? ■TW-C R e p ro d u c 'd fro m the UnclasStfTe-d / D eclassified H oldings of the N ational A rchives B H i fhi* is to advlee yoa that the 3oa*ft *• letter of Ootob*r ^J relat ing io*6pen osrmt operationa baa been ■lightly modified by the insert ion of the word# * with re*pect io b ills of exchange* on the last page of the letter after the word* "free to fexarcl## tli« authority granted nndar Section 14," f M « addition doea not alter the eenae of the letter bat has b e « introduced for the eake of The letter aa thaa »o<lif led will be o ffic ia lly pab~ lielMd in the Faderal Re»<*rre Bulletin for 5ove«ber* Eeepaetfally# Secretary* Mr. John E* Rich, Jr., Oh&traftA*. Board ©f Director#, Federal Reaerre Bank of iiiime&pol 1*.
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