The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
MarcL>9, 1933*
MR* HARLAN:
The following question# were submitted 'by Childs/Federal
Reserve Bank of Chicago*
- j
1. Submitted by a bask in this district - Ve hold approxi
mately 70 per cent of total trust funds in fiduciary capacity
collected prior to holiday in currency STOP This currency is
physically separated from assets of trust con^any STOP Ifey we
disperse such currency in normal way to beneficiaries? I Since
>~fljgnking holiday we have established a new and special classi
fication of trust funds 100 per cent in cash. We believe we
have authority to Utilise such new trust funds for the use and
benefit of the trustees and beneficiaries involved without
restrictions, are we correct?
(id
2* Shall we pay here at the Federal Reserve Bank in
Chicago past due Government obligations and coupons thereon?
j*t
L
3* At the present time are banks permitted to pay for
bill of lading drafts covering food or feed products Including
livestock. We are now asked as to whether or not banks may
release deposits for the payment of livestock in the stockyards
ready for sale, although not covered by bill of lading terms,
the question arising from the fact that the stock is there
ready for sale apd must be taken up* Can banks release deposits
to consumers to be used for the purchase of livestock under
these conditions*
4# Are bond or stocldb/ouses acting as fiscal agents for
corporations in paying ^a®*'-wfr interest on bonds? Do they
come within the Presidents Proclamation?
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
mo,
FEDERAL RESERVE SYST1
(LEASED W IR E SERVICE)
RECEIVED AT WASHING
4em r
P h i l a 1105a M a r 9
Board
Washington
•yery important
/ /
to P h i l a d e l p h i a C l e a r i n g H o u s e b a n k s to m a k e
S a t u r d a y c l e aring of F r i d a y * s b u s i n e s s a m o u n t i n g t o about
$ £ 8 , 0 0 0 , 0 0 0 b y d e bits and credits on b o o k s of r e s e r v e b a n k
as u s u a l S T O P T h i s w i l l r e sult
in credit to F e d e r a l R e s e r v e
B a n k of over $ 1 , 5 0 0 , 0 0 0 S T O P If not
done over 5 0 , 0 0 0
items
Lust be r e t u r n e d and b a nks w i l l be c o m p e l l e d to o p e n w i t h o u t
kxknring d e p o s i t o r s balances.
P l e a s e g i v e a u t h o r i t y if possible.
Norris
1115am
U. 8. GOVERNMENT FEINTING OFFICE: 193P
2— 11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o rm 148 b
TELEGRAM
FEDERAL RESERVE BOARD
W ASH INGTON
March 9 t 19'Sc ,
Norris - Phil dal >hia
Jl / ¥ f S -3*
Your wiro\ro par itting member bank indebted upon 15 dry note to exhaust
its bn lance with federal Heaerve Bank to provide payroll or for other
permissible purposes stop Regulation G prescribes fully conditions under
which currency siay be provided •nd discounts extended to :ember banks stop
Tour question nppenra to involve matter of credit policy 'which must be
determined by your bank in light of regulations
:orrill
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o rm 1181)
TELEGRAM
FEDERAL RESERVE BOARD
W ASH INGTON
m*Qk 9,
1953.
Norris - Philadelphia
Your telegram 7thf/xeger*ii!g release of gold to the arts,
partment advises matter Is still under eonstfieration•
McClelland,
EMjl/acn
Treasury Be-
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
mo.
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
5 3 dmr
r e c e i v e d a t w a s h in g t o n
,
d
.
c
.
Cleveland M a r 9 349p
Morrill
Washington
This b a n k has a p p r o x i m a t e l y q u a r t e r m i l l i o n dollars
d r afts f r o m m e m b e r s
in rem i t t a n c e
on t h e i r r e s erve a c c o u n t s and r e m i t t a n c e d r a f t s
of n o n - m e m b e r s u p o n o t h e r b a n k s for pr o c e e d s of c o l l e c t i o n s of
non-cash
items m a d e p r i o r to M a r c h f i f t h w h i c h drafts wer e not
r e c e i v e d u n t i l a f t e r the P r e s i d e n t ’s p r o c l a m a t i o n a n d have not
b e ^ n f u n c t i o n e d stop Request p e r m i s s i o n be
c l e a r a n c e of these drafts.
Strater
355p
U. 8. GOVERNMENT PRINTING OFFICE; l « r
a—lMoi
§§ £ £ £ © & to a u t h o r i z e
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o rm NO. 131
Office Correspondence
j Q
From
FEDERAL RESERVE
BOARD
Mr* Harlan
Subject:._
UtClelland
8495
Ur* Yaeger of tbs Federal Heserve Bonk of Minneapolis called
tilth reference to the case of a cigar manufacturer la the Ninth Federal
Reserve District who is in need of revenue stampa for hia product*
In a
telegram to the Board, Governor Seay of Richmond also stated that the
question of payment for revenue stampa is particularly important in
the Fifth Federal Reserve District.
I do not know whether the matter can be handled under Regulation
10 or whether it is on a par with withdrawals for the purpose of payment
of taxes*
natter*
EMM/acw
Perhaps the eonraittee on interpretations should consider the
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(UEASED W IR E SERVICE)
RECEIVED AT W ASHINGTON, D. C.
it*
91ghb
KansasCity * W r
9 1111am
Board
W a s h i n g t o n DC
M a n y b a nks are i n q u i r i n g w h e t h e r the y m a y r e c e i v e on de p o s i t
their
customers
out t h e r e o n but
checks d r a w n on themselves. N o
i s s u e d do n ot s e e m to permit this
that
this be a uthorized.
P l e a s e rush reply*
1235pm
2— 11901
Regulations
thus far
class of t r a n s a c t i o n but w o u l d
Worthington
D, S. GOVERNMENT PRINTING OFFICE: 102P
c u r r e n c y to be paid
such checks m e r e l y to be charged to one customers
a c c o u n t and c r e d i t e d to a n o t h e r on t h eir books.
important
from
seem
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE BOARD
W ASH INGTON
Marssto %
1^33
1 oKlnaftjr - Italia*
iitte fartha*
s ffcik® AnoouiflftiBS
u* M
tmt+mmm to
y a w tetognw of
of th&
Hifclar &9«»dit to jera ia X&«%
U&r&i
MIC
a a#ttI«M«fc
na^mt tor %h& wirm trm*f*r of $1,6oQ«(K3Q through
th« mt«tor£t fc*»a«h for fn» «<soot*ttt of tb# stofl&parda
tfaUoatii Bauic <►* 1^** %*■%&•
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
if
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
12 3 gb ru sh
r e c e iv e d a t
Wa s h in g t o n ,
d
.
c.
D a l l a s M a r 9 1212p
Morrill,
Washn.
Should r e g u l a t i o n 10 s e c r e t a r y of T r e a s u r y a u t h o r i z i n g ce r t a i n
a c t i v i t i e s by n a t i o n a l or state b a n k i n g i n s t i t u t i o n s b ^ i n t r e p r e t e d
to p e r m i t a m e m b e r b ank to ship cu r r e n c y to a n o n m e m b e r b a n k to
enable
such b a n k to carry on limited t r a n s a c t i o n s a u t h o r i z e d by
various r e g u l a t i o n s of secretary.
P l e a s e r u s h reply.
Co l e m a n
125p
u s. M T n in m n a m M t n m : i«
a—iiooi
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
109gb
Sanfrancisco Mar 9 951am
RECEIVED A T W ASHINGTON, 1
Morrill
Wash i n g t o n .
Please obtain ruling from Secretary of Treasury on following point
at request of the Sanfrancisco Clearing House Association:
M a r c h 2, 3,
and 4, were d e c l a r e d legal h o l i d a y s
in the S t ate
of C a l i f o r n i a by the G o v e r n o r on the m o r n i n g of M a r c h 2nd.
Banks of the S a n f r a n c i s c o C l e a r i n g H o u s e have
The
b e e n h o l d i n g checks
w h i c h w o u l d h a v e b e e n c l e ared the m o r n i n g of M a r c h 2nd p e n d i n g the
r e o p e n i n g a f t e r the holiday.
1% w o uld
U n d e r the proclaiaation of the G o v e r n o r
hav e b e e n p o s s i b l e for t h e m to have
cl e a r e d t h e m on M a r c h 2nd,
It is n o w t h e i r desi r e to clear these items as of M a r c h 2nd and wish
p e r m i s s i o n of the S e c r e t a r y of the T r e a s u r y to effect d e b i t s
ag a i n s t
involved
the a c c o u n t s of their d e p o s i t o r s a f f e c t e d and a u t h o r i t y for
m a k i n g sett l e m e n t
in the u s u a l w a y on the books
R e s e r v e Bank.
Hale
lllp
of the F e d eral
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
---------------------------
H
FEDERAL RESERVE SYSTEM
_
RECEIVED A T W ASHINGTON, D. C.
17fmr
M O Washn
message
c o n t a i n i n g r e g u l a t i o n 15
M
A t l a n t a Mar__9_
1042a
(33
u. 8. GOVERNMENT PRINTING OFFICE: 102P
2— 11901
to locate a n y
Can you advise what number
to us if sent.
/
j {j
(LEASED W IR E SERVICE)
See y o u r n u m b e r 1 date to B l a c k w e are unable
)D
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o rm 148'b
TELEGRAM
FEDERAL RESERVE BOARD
WASHINGTON
march 9, 1933.
Toimg - Bottom
Harrison - ITw York
lo n r ls * Pi&la& elpM a
Iteaystar - Cltnrelaod
m m nt m
Seay Bl&ofc ~ Atlisafcafc
MflOttsgsl - Chicago
Maartia * St. lm £ *
» Minneapolis
Baratltos - Kansas Citjr
MaElimfly - UallJMi
CalldL&s - San SVancisco
i : OqpplsnMittsg tr&ns. 1568./Published reggnlatloa
eomtaiasd la tr&os. 1 0 W ua»1>®red (15)* Additional uimublished
rqplatioaft and author! mtion tore been lettered as follows:
(i) tran*. 1^0, (j) tr&ns. 1569, (k) Iraai, 1584. 8tvab«rs and
letter# ©f fo*tb«r regulations, interpretation®, etc., rill be
furnished whea transmitted.
McClelland.
SHC/vmt
Reproduced from the Unclassified I Declassified Holdings of the National Archives
1933MAR 9
™ 11
,4
Ij'lQ
A
wmk % v m
W «»I
B«nk ©f« Boriea
Sv* I#arfc
I
I rffl
GXs**l*m&
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$M tlMl
KleteonA
Atlanta
Imat* @1%
ftfci -jju
IIbIJMmi
3t* Lottia
So* ftr-wia—
V f tltti JlIDll WWfaJflll
t^T
tlMI PSMNiJWkMll^l ©IT t))0 lllfei&tMNl iStliiMNk
m m § m * .— T_ .y is u m , «» i m
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x» f u t t y i &» m m m m 9
P tw M m k ® f tfa* f a lt « d *!$ «*•» « * Ajs*riea, tgr FroeJUwtSoB d »o l*r# d tlM
•x lrttm of A M tottil «—rgWTMpr MttS -roolaiiwd * mat
mtm&ing
ftp©ft VMMtar H * #**i d*r ** Jtotnah t# Tfcsrad*/ ill* 9tfe d«gr *f JNnpots* 1933t
fee** Mmi iuolusiv#, to ord«r to pr^irwit %tm
Mtct&g
mm
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bNHdi&g m m*~
f } nr tpm xlM m
fttr*£|gn ^ ohflkng*} aa§
H M H ® * w d * r t i » Mfc » f «*re li 9# 19%
b w r*to f«m o r l i * r » * f i * r ia m u l Iqt
*11
P r*ad d «it g w rn o tt to Ifee **fcharltjr
ecm ftrrtd I f n r t i < i fC*4 «C t » * Aet $ f Octolwr 6* 191?* « s « a * & M f « r *
•ppfMMl
itti
'WBERSil8|i flhttrf
SSUUL
ffflfrf 4%
osravr w> eoe®EpjL«Pii p W H pariwawM
mm, tessMKsst, x# n m i $» wo&wtms,
tlMI V n iU lU SHWktrfMI ©f ARMNP&QNtif
«f
01f:MRtttX. fMMItifiimlWl^
wm| ^ wlrtiw of tfrf* suttisosyi^ vtpytHMi in mi Iiqp S^spISciii 5{^) of Slis Apt 9f
Ootokcr 6» X«7 (40 S l«i. U » 4U ) mu « m M tgr «tw i« t of «»nft 9* 1933*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
to hMMigr iw rtrit, ««*•*,
«a* 4m U n that >11 <*• toms « A
T tn w « f M l« FiwleeWwi *f MHMk *, « • » , «tit «to m rtittaw sat «to w
tom * Um w U m
tmniqr N * U i a l 1» fuU <MH» m& «f«w t antii {w tkir
n n a n s tnaeatar z km i h w i i a * «r
W
»«• W V N
W H M
« * km mdm «*• »«ai
wm m*1HKajmBMI*
dm* tm the $|si»i«t «r M m M «9 tttte till ««r of iftmfc,
In ^ 10 'SftMUP 1 0 HMfr &MMI ISMI
I^MPkMOM SHWH wwlWlw mm vMJFfgp*
( MM&i
«r **» &&*•* . j r
hukkucr
nwwMyt
w
r
imoaroEs
Reproduced from the Unclassified I Declassified Holdings of the National Archives
for m z m m m release.
STEPHEN T. EARLY
Assistant Secretary to
the President
BY TKZ PRESIDB.TT 03’ THE UiTITED STATES 0? JLEKLGA
proclju nation
MAR ■ 9
'.333 .AS, on March 6, 1933, I, 3MJKLIN D i :m S 2 T :J J I,
President of the United States of America, by Proclamation
declarod the existence of a national emergency and pro
claimed a banl:: holiday e:rfcending fron Monday the 6th day
of liirch to Thursday the 9t!i day of Llarch, 1933, both dates
inclusive, in order to prevent the e::port, hoarding or ear
marking of gold or silver coin, or bullion or currency, or
speculation in foreign exchange;
and
.;II2REAS, under the Act of Llarch 9, 1933, all Proclama
tions heretofore or hereafter issued by the President pur
suant to the authority conferred by section 5(h) of the A c t •
of October 6, 1917, as amended, are approved and confirmed;
and
'.TOGAS, said national emergency sbill continues, and it
is necessary to take further measures extending beyond I.!;.rc>.
C , 1933, in order to accomplish such purposes:
nor;, THEREFORE, I, SMJELIN D. ROOSEVELT, President of the
United States of America, in viev,r of such continuing national
emergency and by virtue of the authority vested in me by Sec
tion 5 (b) of the Act of October 6, 1917 (40 Stat. L., 411'
as amended by the Act of larch 9, 1933, do hereby proclaim,
order, direct and, declare that all the terms and provisions of
said Proclamation of ISarch 6, 1933, and the regulations and
orders issued thereunder are hereby continued in full force
and effect until further proclamation by the President*
•<v.wuuu* nu... uie unciassmea / Declassified Holdings of the National Archives
IK '.ITi'ESS ..'HCREOF I have hereunto set my hand and have
caused the seal of the United States to be affixed.
Done in the District of Columbia, this 9th day of llarch,
in the Year of Our Lord One
Thousand Nine Hundred and Thirtythree, and of the Independence
(SHAL)
of the United States the One
Hundredth and Fifty-seventh.
ERAIKLIN D. ROOSEVELT
By the President:
CORDELL HULL
OAfl'wo+a-mr nf* State.
BY THE PiiEt J M
OF THE UNITED STATES OF A&DL.JCA
A PROCLAMATION
WHEREAS, on March 6, 1933, I, FRANKLIN D. BOOSEVELT, Resident of
the United States of America, "by Proclamation declared the existence of
a national emergency and proclaimed a hank holiday extending from Monday
the 6th day of March to Thursday the 9th day of March, 1933, both dates
inclusive, in order to prevent the export, hoarding or earmarking of
gold or silver coin, or bullion or currency, or speculation in foreign
exchange; and
WHEREAS, under the Act of March 9, 1933, all Proclamations hereto
fore or hereafter issued by the President pursuant to the authority con
ferred by section 5(3j) of the Act of October 6, 1917, as amended, are ap
proved and confirmed; and
WHE3EAS, said national emergency still continues, and it is necessary
to take further measures extending beyond March 9, 1933, in order to ac
complish such ourposes:
NOW* THE3EF0BE, I, FRANKLIN D. 300SEVELT, President of the United
States of America, in view of such continuing national emergency and by
virtue of the authority vested in me by Section 5(b) of the Act of October
6, 1917 (40 Stat. L., 411) as amended by the Act of March 9, 1933, do
hereby proclaim, order, direct and declare that all the terms and provisions
of said Proclamation of I/iarch 6, 1933, and the regulations and orders
issued thereunder are hereby continued in full force and effect until
further proclamation by the President.
Ill WITNESS WHE3E0F I have hereunto set my hand and have caused the
seal of the United States to be affixed*
Done in the District of Columbia, this 9th day of March,
in the Year of Our Lord One
Thousand Nine Hundred and Thirtythree, and of the Independence of
(SEAL)
the United States the One Hundredth
and Fifty-seventh.
F3ANKLIND. BOOSEVELT
By the President?
COBDELL HULL
Secretary of State.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
March
1933.
The President
The %ite House
Dear Mr. President:
Referring to your inquiry this morning, the federal
Beserve Board foal a that It i» important that control ost
the export or hoarding cat fold or silver coin, or bullion
and curraacy, and of transactions In foreign exchange
should be continued, the exercise of such control to be
vested in the Secretaiy of the Treasury or the Federal
heserve Board, as you nay direct.
If you so desire, the
Board will be glad to draft an appropriate order for this
purpose fcr your signature*
Fieepectfully.
Governor
MAR ap %
Reproduced from the Unclassified I Declassified Holdings of the National Archives
?
//
M H M k », r n a .
B u r t M M - K m IWrtc
B w v ta « <>kUbMMlpkU
twutomt -
cl«ndL«wl
J I W ».
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Hiiurj m ^*Bifli|w86$Ss
HnadlXt»B * m m m m City
m m * *
Uamm - Saa mtMtaao
uwii*
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M
A
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a»
w
m
i*r
in « * » » • # * * « » vttfc
Hfc* ®*
M<iC2XeH,afid•
Reproduced from the Unclassified I Declassified Holdings of the National Archives
f/
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«* $«* TiMsift
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1
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e«a«ai**iu
Reproduced from the Unclassified I Declassified Holdings of the National Archives
/
b
Ik n k •» M M .
XotiBir - Soafem
Horrida.hiMi
3*|®y
Blfcolt - m « W
fMMter -
Bertie - St.
0***y J«r.tcK - * “ >*“
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grain i* i&tm*** for f»xe***it»g or m m # *!** in « l»
m Q l# U *o A >
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TREASURY DEPARTMENT
PRESS RELEASE,
MARCH 9, 1933.
The President has today ■urged the immediate enactment of
legislation dealing with the existing hanking situation.
It
appears that prompt action will make hanking facilities and
an adequate supply of currency available,
Notwithstanding the
expected early opening of hanks, the Secretary of the Treasury
interposes no objection to the issuance of clearing house certif
icates Qr other evidences of claims against assets of hanking
institutions, in communities where local conditions make such
action necessary.
The regulation issued hy the Secretary March
7, 1933 remains effective, granting permission to clearing house,
associations and other associations organized to provide an
adequately secured medium of temporary, exchange to issue certifi
cates against sound assets of hanking institutions, such certifi
cates tp he deliverable hy each institution to its creditors
and depositors on a pro rata basis.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o rm I ift b
TELEGRAM
FEDERAL RESERVE BOARD
WASHINGTON
Itarefet 8. 1993*
Young - Boston
3/t/JJ
.*.
Your tolagraa jre&agdlng release of ®dM bars for uae in
Treaaury Daparteooat advise* matter is aUll undo? consideration.
McClelland*
SBC/aov
IMuatqpy,
Reproduced from the Unclassified I Declassified Holdings of the National Archives
S t a n d a r d f o r m no. m
Approved b y
From
th e president
Boom
Zr
.
MARCH10.1828
10—1738
Bureau
TELEGRAM
Chg.Appropriation— Coatg. Exp*
OFFICIAL BUSINESS— GOVERNMENT RATES
v. s. ooratNuw r mmtma ovnca: im »
March 8, 1933
YOUUG
BOSTON
Jfotfll^lkrch eighth concerning release of gold bars for use in
jewelry industry S f ^ M a t t e r 1'’still under consideration STOP
jK/H/t00I)Iif
Secretary p t thei^reasury
[4 ^
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
3
55bs
I
RECEIVED AT W ASHINGTON, D. C.
Boston 550PM Mar 8
Board
Washington
With further reference to transaction 1555 the following telegram
was received by me Quote Gan you assist this community in its real
distress stop Thirty thousand people dependent upon jewelry
industry which has as its base gold bars stop Factories compelled
to close because of inability to secure gold bullion from bank
stop Comparatively small amount of gold needed to keep us going
stop Statistics department of Commerce nineteen thirty show that
fifteen millions of gold was used in manufacture and twenty seven
million in actual gold values came out through recovery in refining
stop Situation here is desperate stop Immediate release of gold bars
necessary for the well-being of workers and their families in this
district. Roy A Hltchings
Vice President first National Bank
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
RECEIVED AT W ASHINGTON, D. C.
Shoot S*55bs
Attleboro,
Mass*
Unquote. Treasury regulation to cover this
situation would he helpful
Young
42 SP
V. S. GOVERNMENT PRINTING OFFICE: 192?
2— 11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
RECEIVED AT W ASHINGTON, D. C.
58b s
Boston Mar 8 4PM
Board
Washington
Further reference to transaction 1555 Strong feeling in Boston in
which I ooneur that banks should not be permitted to declare or
pay dividends during the holiday
Young
414PM
V. 8. GOVERNMENT PRJNTINO OFFICE: 192f
a—11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
1 4 1 0 .
©rfaaar^
OFFICE.
T E L E G R A P H O FFICE
,,
,
A A
■333 MAR - 8- W J ? “ 44
’^ s v tV 'o ^ T s X Washington, D. C.
T R E A S U R Y D E P A K I W ENT
C46W Ml 52 XC
HACKENSACK NJ 5T9P MAR 8
FEDERAL RESERVE BOARD
WASHN
UNABLE TO HAVE FEDERAL RESERVE BANK OF NEWYORK AND NEWYORIC
CORRESPONDENT ARRANGE F0R NON MEMBER BANKS TO OBTAIN REPLENISHMENT
OF CURRENCY USED FOR PAYROLLS ETCTERA T H IS MATTER IS VERY IMPORTANT
TO NON'MEMBER IN S T IT U TIO N S TO MAINTAIN RELATIONS WITH PUBLIC
TO SAME EXTENT AS MEMBER BANKS PLEASE TAKE STEPS TO CORRECT TH IS
CONDITION
THE HACKENSACK TRUST COMPANY
Reproduced from the Unclassified I Declassified Holdings of the National Archives
A member bank requests that we submit following proposal that member
banks be permitted to charge a depositor with a check given in settlement
to another depositor in same bank and to credit payee without paying
out coin or currency.
We suggest that this be not allowed for the present as it might disturb
existing rights of offset between bank and depositors.
We suggest that individuals, firms and corporations seeking to withdraw
money or currency from banks for purpose of pay rolls or other authorized
purposes be required to certify in writing the amount of gold or gold
certificates, if any, held by persons making withdrawals and to deposit
such gold or gold certificates before receiving money or currency*
Member bank desires to receive money or currency from local postmaster
and issue draft on us as means of making transfer of postal funds.
Suggest bank be authorized to do this provided money or currency
received is held by it intact for our account or shipped to us.
Wallace
_______
U. 8. GOVERNMENT PRINTING OFFJC*: IMS
147p
2— 11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(UEASED W IR E SERVICE)
RECEIVED A T W ASHINGTON, D. C.
I
'
)
Atlanta M a r c h 8 255p
Morrill
Washn
A m e m b e r b a n k in F l o r i d a h a s s u b m i t t e d the f o l l o w i n g q u e s t i o n s c^uote
C a n a b a n k charge the a c c o u n t of a d e p o s i t o r w i t h a c h e c k d r a w n
e i t h e r b e f o r e M a r c h f o u r t h or a f t e r M a r c h fourth, w h i c h c h e c k is
p r e s e n t e d for credit b y the h o l d e r to h i s old a c c o u n t
h is n a m e on our b o o k s on M a r c h fourth.
s t a n d i n g in
T h i s d e p o s i t not to be m a d e
in s p e c i a l a c c o u n t a g a i n s t w h i c h s p e cial a c c o u n t s we are r e q u i r e d to
p a y cash.
If such t r a n s a c t i o n s are p e r m i t t e d and w h i c h do n ot require
the p a y m e n t of m o n e y b ut m e r e l y a t r a n s f e r on our b o o k s of the credit
of one d e p o s i t o r s a c c o u n t to the credit of a n o t h e r d e p o s i t o r fs a c c o u n t
U. 8. GOVERNMENT PRINTING OFFICE: 192P
B—11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
RECEIVED A T W ASHINGTON, D. C.
and not subject to cash payment it would greatly facilitate all
business transactions and checks in this way could largely be used
for payroll purpose in lieu of currency unquote
Have advise bank
that shifting of credits on its own books which involved no payments
of money are not in my opinion permitted by letter of proclamation
and regulations although in my opinion this would not violate spirit
of proclamation believe permission to make book transfers would be
helpful and would appreciate your securing regulation in this regard.
Black
415pm
U. S. GOVERNMENT PRINTING OFFICE: 193R
2— 11901
Treasury
STANDARD FORM NO. 14a
Approved b y m
President
department
W A S H IN G T O N
March 10,1926
TELEGRAM
Charge T reasury D epartment , A ppropriation
OFFICIAL BUSINESS— GOVERNMENT RATES
The appropriationfromwhich payable muat be stated on above line.
March 8, 1933*
(COQPY)
y
Martin
Federal Baaerre Bank
St* Louis, Missouri
Ratal 7 r? STOP
*Food or faed'producta/as used in Regulation 6
mj
construad aa including whole grain if such grain is intended .for
processing or conauaption in the immediate future.
V
f f is
W.
for
WOODIN,
Secretary of the Treaaury.
Q
ba
4 7 0
T reasury
STANDARD FORM NO. 14a
Approved b y h i e P resident
March 10, 1926
department
W A S H IN G T O N
TELEGRAM
Charge T reasury D epartment , A ppropriation
for
OFFICIAL BUSINESS— GOVERNMENT RATES
The appropriation from/which payable must be stated on above line.
< o T m n n piditwo o i m a i 2— 14117
FttoffcX H b w m m n i fiuric,
i U B I i p i U I | mQkWtmmOmtm
i m i
a, m
IN r iM fll
M g M r t t l s g s v I m m m i 9 t f t e n d U i fo 9 J M U N d M U M O f l f t t W t t f t l
V V M M M I fftwjpft lJl •OXUMCtlOft Wfttll
■SBttflMfai&MfB* Oi|tt
flM
M
ftaM
HW
V&Afll O
G
H
pM
Q
f MMMlA INI Vt^MRNMl t#
9t IXlM
NHM
Klt
We H. Woodlm*
an n tiq r of tti Tmmvy*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(L E A S E D W IR E SE R V IC E )
216gb
RECEIVED /ft* YiA
Dallas Mar 8 „351p
Board
Washn
Merchants throughout the district and particularly in the larger
cities have vast number of checks given them since the holiday
started in this state, the banks having been closed since march
We feel that it would be helpful and not
x £k 3:kx £z3
violate^
the spirit of existing regulations if banks would be permitted to
accept as deposits checks drawn on themselves, provided that such
deposits would under contract with depositors be restricted in
like manner as deposits existing at beginning of holiday are and
may be restricted.
It should be understood of course, that each
bank would accept checks drawn only on itself.
This regulation
would not only have a very reassuring effect on the public generally
but would enable Igilmk the banks to post and dispose of checks
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
{i w a r n W IR E SE R V IC E )
RECEIVED A T W ASHINGTON, D . C.
before the end of the holiday period.
The Dallas clearing house
authorizes us to say that i* strongly urges the issuance of this
regulation, feeling that the merchants are entitled to know the
fate of these checks as quickly as possible and before the expiration
of the holiday,
Mckinney
555p
v . s. eoram nnrT n n m m ©me*: m s
9—>11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTE m L J
(LEASED W IR E SERVICE)
gb
RECEIVED A T W ASHINGTON, D.
Dallas
1059am Ma r 8
.
/ 5
(h—
Board
Washn
On F r i d a y and Sa t u r d a y of last w e e k w h ile we w e r e
re c e i v e d wire
still open we
t r a n s f e r s through F e d e r a l R e s erve B a n k s of Chicago
C l e v e l a n d and N e w y o r k for a c c ount of the S t o c k y a r d s N a t i o n a l Bank,
Fort Worth,
for. u s e of A r m o u r and Co,
II
p itta s .
c o m p l e t e d - t h r o u g h the gold fund.
a g g r e g a t i n g $ 1 0 , 0 0 0 , 0 0 0 of
. p p . r « » u y ■>« » ° « ■ » « |l
The r e m a i n i n g $8J 4 0 0 , 0 0 0
though
w a s c o m p l e t e d and the s t o c k y a r d s N a t i o n a l B a n k d e s i r e s u s to
t r a n s f e r all or a s u b s t a n t i a l p o r t i o n of this m o n e y b a c k e i t h e r
to the b a n k s f r o m w h i c h it came or o t h e r m e m b e r b a n k s w i t h o u t
this d i s t r i c t c l a i m i n g the m o n e y is n e e d e d for feed and food
p u r p o s e s in a c c o r d a n c e w i t h the S e c r e t a r y ’s regulation.
entirely willing
to m a k e
such t r a nsfers as they m a y d e s i r e
e x t e n t of this $ 8 , 4 0 0 , 0 0 0 and also
IT. S. GOVERNMENT PRINTING OFFICE: J92P
2_11901 /
£
m*
We are
to the
t r a n s f e r the $ 1 , 6 0 0 , 0 0 0 if
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
RECEIVED AT W ASHINGTON, D. C.
^ y ou wil l advise us that we h a v e re c e i v e d
credit
We should a p p r e c i a t e y o u r i n s t r u c t i n g us w hat
premises.
McKinney
12l8p
EJ. 8. GOVERNMENT PRINTING OFFICE: 192P
2— 11901
in gold
fund.
to do in the
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
^ | |
RECEIVED A T W ASHINGTON, D. C.
lgs
San Francisco
Mar 8 9Q2PM
-9
Morrill
Washington
Would
it be po s s i b l e
fn-,nish us with
to f u rnisn us w n
regulations .»■>
or
« » ™ i « . « This -ouM P—
furnished banks
H ale
814 A M
JJ. B. GOVERNMENT 1PBTNTING o m o i : 19SP
2— 11901
»
»• *°
t h e n T r e a s u r y n u m b e r of
S . c r . W .!•« o r l e u » U T
a" l6n,t'
Reproduced from the Unclassified I Declassified Holdings of the National Archives
COPT
q i o
,
TBUEQRAM
FEDERAL RESERVE STSTEM
Received at *%shlngton, D. C.
309gy
Sanfranoisoo 661p Mar 8
William H Woodin
Washington
Replying your telegram March 8 we are Bending by Cowserclal wire list of
member banka in twelfth district regarded aa solvent aa going banks but
not on a liquidating basis.
A indicates-Bane of bank*
Banka Indicated by ABA transit numerical key.
B indicates total deposits.
D indicates gross capital structure.
C indicates capital.
% indicates questionable assets and
depreciations as set up by exsmlner and F indicates net capital structure*
Figures are in even thousands and are taken from last examination reports.
In most cases we are not aware of adjustments made or changes in condition
since last examination and they are therefore not taken into consideration*
While 11-17 and 11-55 are classified as solvent reference must be made to
last report of examination in comptrollers office to determine true condi
tion of these banks*
Newton
1016m
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o rm I l8 b
TELEGRAM
FEDERAL RESERVE BOARD
WASHINGTON
M a rch B t 1933.
Anderson - Cleveland
Your telegram#
/
^
HO statement regarding request# made in trans* 1577 and
1588 given to preaa by Board.
McClelland.
EMM/acw
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Xoting * Boston
Harrison, - Wm fork
Koifii • PhiladttLphia
IteehMfi Glorolaod
a«gr « RiO}yM&di
aril'll
TEAMS NO,
March S, 1*33
McDoogaX ~ Chicago
Martla «* 8t« I«ouia
* A M N f _ 114m i a a m a I 4 «
*oo*y
- Mimioapolia
Hamilton - Kana&a Oltgr
—
OaJLlss
C*lkla» - San rraoiioo
T l Bo ofcjoottoa to your coaaainicating to
inatitutiona
and atata basking authoritiea any ragulatioaa limad fcgr Secretary of
troaaury, whether or not given to pvoaa here, unload you fool tbat whan th«Qr
relate aolely to internal Federal
remrrm bank
operations outoii notion la
not neceaaary*
Dougina
Assistant Soorotnry of
trmmgf
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(L E A S E D W IR E SE R V IC E )
'
RECEIVED A T W ASHINGTON, D . C.
•> I f-
4
6Srhu
Cleveland Mar 8 843p
Morrill
^
Washington
*
Tour Trans 1583*. Has this material been released to press associ
Anderson
852p
v. i. M m w » v n n n D n ovnei: v m
s—nm
Reproduced from the Unclassified I Declassified Holdings of the National Archives
410,
jro. 1 5
won immediate b m m s e
March 8 , X933-
Under the authority conferred upon him by the President’s
Proclamation of Harch 6 , 1933» declaring a bank holidays, the
Secretary of the treasury has issued the following regulation:
*$he permission granted in Regulation number
7
that
deposits heretofore received by any banking institution
pursuant to agreement or legislntive authority providing
for segregation and repayment without restriction may
be paid on demand, includes any bank In which any such
deposits have been redeposited by or on behalf of the
receiving bank in accordance with such agreement or
legislative authority.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
3/T/-53
(LEASED W IR E SERVICE)
RECEIVED A T W ASHINGTON, D. C.
Philadelphia 1045a Mar
7
Board
Washington
Is it contemplated that under regulation authorizing resumption of
usual banking functions etc a member hank owing us on a matured
fifteen day note may exhaust its balance with us to provide
payroll or other necessary cash#
Norris
1050am
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
*f
l o ,
i p l *
RECEIVED A T W ASHINGTON, D. C.
6c fa
Philadelphia 12l5p Mar 7
Board
W a s h in g to n
May a bank secure from the Assay office and deliver to a gold beater
his regular normal supply of gold for use in the arts?
Horri s
12£5pm
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL. RESERVE SYSTEM
(L E A S E D W IR E SERVICED
RECEIVED A T WASHINGTON* D . C.
/
0
136grar
Chicago 220p Mar 7
Douglas
Washington
Referring telephone conversation last night are we authorized
to pay in currency at this bank, if requested, past due
Government Bonds presented for payment.
Eugene M. Stevens
331p
a. 8. «omnfM«!rr prtntdw ojticb: imp
2—>11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Here is a telegram from Stevens of
Chicago raising th e, question about which
I spoke to you tins evening. I hope that
the Committee £fan take action tonight to
authorize the payment of Government
obligation^ when presented for payment.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
LftO,
FEDERAL RESERVE SYSTEM
3
(LEASED W IRE SERVICE)
RECEIVED A T W ASHINGTON, D. C.
13 gar
Kansas City 9a Mar 7
McClelland
Washington
Referring to your trans 1557, it is assumed’ that the Secretary’s
instructions to the Treasurer with reference to payment of
checks on the Treasurer of the United States by shipment of
currency etc should be observed by Federal Reserve Banks.
Hamilton
1012am
U
a
JU U
s
A
-
d
^
if
a
/U ^ //\A h C
M
h a
X
,
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Office of
Assistant Treasurer
of the United States
t z ...
Memorandum for
, 193.
Reproduced from the Unclassified / Declassified Holdings of the National Archives
TELEGRAM
470.
FEDERAL RESERVE SYSTEM
(LEASED W IR E SERVICE)
[
I
RECEIVED A T WASHINGTON, D . C .
Sanfrancisco/Mar 7/8 715am
Morrill
Washn
Referring Boards wire no 1563
Does Secretary anticipate issuing
regulations governing disbursement of coin and currency to non
member banks
Hale
1026am
s
Reproduced from the Unclassified I Declassified Holdings of the National Archives
f e n * % X933
fm om r9
€X»*«Ximd;
ikts&iXton*
»rw.r*|
38orti».
U k r r tM A f
B m fork
fell**
S t* liOUi#
BX®^
A o r rla
C£%
Cfciioi^o
i?«oryi
® lk im p
i j fogisslftoo
Atxwnt*
mmu i s U
PafeXX»l*tf
!l»f#r>*iag morion#
'
yftftttrtoy and todj^*
by jtauratftzy of Itmmuey
m fo llo w
(I) fothcr :i^l^: PodoreX .ra^nnr# h m k a to amfce ®imnm oto* (£) SrnatlBi?
tiscwa to Jofoty <*«*o*£t te;«$.p oto« (3) Asiifcorlxiag rottim of onofe*
«*K*olr» a»d ottwr itmm rootiwA after %mt **Xo#i»,; Tamrst m & not
(4) Qm&ln% treasurers checks (5) Aoooplittg p ^ n « t orj obXX- :«tri©a«#
(6) Pftr&litrUi Mrt*la feetivlilo# to soia*o«il<;*» * H h food sir ft >
(?) J&taatlsdtif apo&ioi trust naseottiito* oto* (i) itttbot-lxia..-; ?o
of
lotion
m oo^t&Xn shoofcft* (f) Authorlsisia ©ortsila ^oXivorio* frote
**fo fcooptoe* (XO) A-tJ»rl*ia> oortoia *0ti*lti0i ty Bfttiofcsl or etot*
\mtikhi,r' Iftotituitomu (XI) Author! ata,-' 4ft£e*lt» to »ooujpo i*2hr*G«H«i to
fo ra ll* )»r«cAehmi ( V ) Pm
o f e «rtiflo a t* *
ncKaoicI «#*«&«•
(X3) Jatboris-'iA^ oosatiimMieo trust ootirltloo* (X&J Jtotborltift:? aont&aMfc&o#
fiscal agency operations f«**#r&X
8cafc#«
Tint foUowto,; ttftgaKUciM
f^^aX«ttos»t iafftrufttlcKU* -^d latorpretatloa* is#*# Imm* lottorod (a)
%M%m4stUam to Tr#*JM*For of Ublted:Staton {!>) troanftr* of Fsdowl
for $r®***r«**o asootmt ot&* (o) Authoriaia? ^arcsaooo of
f«M
>iOX«l «#rtifi<j$too hjr ?odor*& ? # i t m Beak#* (d) X»torprotis%;.. ton*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
ftotifi * r IM I
lii^airgr
tmtemm %t* feanil&i i m t -*«* t e #
%img
m d msfowt b m & m * (fc)
»«!
mxtil&t ptocltteitm It)
«*#»rv« task* t* r*»idwi
ffwds* (g ) mttmr* it
m4
pmm,
0tU,iM
sNtHl?
b*%mm TmBmmt
P m t#rs& r m m r m tm*Xa U» tew Im
li#s«
W M U # 4 iB
1-*
hmhm
«£»*
TELEGRAM
FEDERAL RESERVE SYSTEM
(UEASED W IR E SERVICED
RECEIVED A T WASHINGTON, D . C .
Id 3 g m r
Kansas City 332p Mar 7
Board
Washington
We understand that regulations of the Secretary of Treasury are
being referred to* by number but we have no information as to
numbers of regulations already issued can you identify them for
us.
Worthington
437p
/X i-
J /i
• • /// ->
u. *. w iB w wTw n w amort in*
2— 11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
/
r
—A ,
■
■
7
Mr. Morrill:
Mr. Dougherty telephoned and said that he thought the following
message should he conveyed to those working on the new regulations.
In
connection with the regulation which says "Any banking institution may accept
payments in cash or any other form acceptable to it on account or in settle
ment of obligations payable at or to such institution", he says that the RFC
holds many hundreds of millions of dollars of collateral consisting of notes
that are payable at the ,banks to which the RFC has loaned money.
he says, are the owners of that paper in due course.
The RFC,
He asked the question,
"Was it the intention of anybody to supersede the provisions of the
Negotiable Instruments Act?"
Also, "Does it make the paper in the hands
of the RFC subject to any set off?"
He said further that there were many
other questions growing out of the regulation*
ydw
March 7 - 12:15 m
-.o
Reproduced from the Unclassified I Declassified Holdings of the National Archives
/
T E L E G R A P H O FFIC E
134WU AB
2 1 9 NL 5 EX
Received at Washington, D. C.
KANSAS C I T Y MO MAR 7
CHESTER A M O RRILL
FEDERAL RESERVE WASHN DC
UNLESS USE OF FEDERAL RESERVE BANK F A C I L I T I E S
IS P E R M ITTED TO EXTENT
S U F F IC IE N T TO P E R M IT INTERBANK TRANSFER OF RESERVE FUNDS IN C ID E N T TO
PAYMENT FOR PURCHASES OF SLAUGHTER L I V E STOCK COMPLETE P A R A LY S IS OF
TRADE AT KANSASCITY BTOCKYARDS IS
IMMIMENT STOP PRESENT TREASURY ORDERS
CONSIDERED S U F F IC IE N T TO P E R M IT ACTION BY IN D IV ID U A L BANKS BUT C O N D ITIO N S
AS TO TRANSFER OF D E P O S ITS NE C E S SITA TE FEDERAL RESERVE COOPERATION
STOP TRANSFERS CAN BE L I M IT E D TO SUCH AMOUNTS AS ARE IN C ID E N T TO AND
ACTUALLY EXPENDED IN THE PURCHASE OF LIVESTO CK
IN COMMERCE STOP ACTION
YESTERDAY OF K A S A S C ITY L IV E STOCK EXCHANGE AT REQUEST OF SECRETARY OF
AGRICULTURE HOLDING MARKET OPEN UNDBUBTEDLY HAD S UBS TANTIAL INFLUENCE
IN CASING OTHER L I V E STOCK MARKETS TO REMAIN OPEN STOP NO PAYMEBTS
Reproduced from the Unclassified I Declassified Holdings of the National Archives
©mrattrg Skparfttmtf
T E L E G R A P H O F F IC E
Received at Washington, D. C.
2 /1 3 4 W U AB 2 1 9 N L ^EX
ON LIVESTO CK SOLD T H IS WEEK HAVE BEEN MADE AND TREMENDOUS VOLUME OF
PACKERS CHECKS AND T IC K E T S HAS ACCUMULATED IN POSSESSION OF MARKET
AGENCIES STOP FR E IG H T AND YARDAGE MUST BE P A ID STOP PLANS O UTLIN E D
HEREBY LOCAL BANKS W IL L REQUIRE ACTUAL
D ISB U R SE M E N T- FROM BANKS OF
R E LA TIV E L Y SMALL AMOUNT OF CASH COMPARED TO TOTAL OF ALL TRANSACTIONS
BY REASON OF FACT THAT MOST OF L I V E STOCK SOLD IS MORTGAGED AND IN T E R
BANK TRANBERS WOULD SERVE TO TAKE UP LARGE PART OF PROCEEDS PAYABLE
STOP URGE IM MEDIATE ACTIO N RELEASING FEDERAL RESERVE TRANSFER F A C I L I T I E S
TO EXTENTB NECESSARY TO ACCOMPLISH D E S IR E D RESULT
JOHN B GAGE FOR KANSASCITY LIVE S TO C K
EXCHANGE
933PM
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Steafluuf Sfpartmntf
T E L E G R A P H O F F IC E
1 33WU AS
Received at Washington, D. C
OUR SEC OF TRSY S I NED C LE A R IN G HOUSE ASSN OF SEATTLE ENRASE
SUBJECT TO CORRECTION
CK 109 6EX 4 2 4 3 WDS TWO WDS NON MEMBER
SEATTLE WN MAR 7
922P
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o r m 1481)
TELEGRAM
Lj
FEDERAL RESERVE BOARD
WASHINGTON
March 7, 1933
Um g,
Bootoa
fa n c h o r,
Cl«Teland
H a rriM E ,
Sew la r k
lo r r ia ,
t&AHS .f C
bmt* information
Blaok,
Atlanta
ScDaugal
Chteag©
Hamilton
Xaiim City
M a r t i* ,
MksKiuaagr,
St* Lo-ula
D allA B
O e c ry ,
Calkins,
San Francisco.
tfiime&polia
7 Seoritaxy
hit# not nliftged to p m »n
contained ia traaa 1563* 15&2, 15&3 and 1564,
HeQUSUUTO
Reproduced from the Unclassified I Declassified Holdings of the National Archives
if/b
181>
' ^
9
TELEGRAM
FEDERAL RESERVE BOARD
WASHINGTON
March 7, 19B3,
Eamilton - Kansas Z lty
Your telegram* Qjiaatioaa rained therein are under active consideration
by Secretary of Treasury who has not yet determined upon exact phrasing
of interpretation or farther regulations involved. His office expects
to issue interpretation re livestock within the hour*
,«
. (signed)
e.
&
M cC lella n d *
mi/rkt
McClelland
Reproduced from the Unclassified / Declassified Holdings of the National Archives
TELEGRAM
i
FEDERAL RESERVE SYSTEM
(L E A S E D W IR E SE R V IC E )
R E C E IV E D A T W A S H IN G T O N , D . C .
19g mr
Kansas City Mar 7/902am
Tashington.
Referring your wire yesterday quoting regulation of Secretary of
Treasury relative payments involving shipment transportation or
delivery of food or feed products, we assume this also covers
livestock but would like further instructions on this point as
well as information as to whether Federal Reserve Banks are to
furnish member banks with cash to enable them to make authorized
payments in currency. Please advise at once as stockyard banks
desire to operate this morning
Hamilton
1025am
o. a. eu\ibnhcmtnunm m w i mm
4>UML
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(L E A S E D W IR E SE R V IC E )
R E C E IV E D A T W A S H IN G T O N , D . C .
26$nr
Kansas City 951a Mar 7
Board
Washington
Are federal Reserve Banks authorized to supply currency to
banks to make it possible for them to make such payments of
cash as various regulations permit.
Hamilton
ICE' 5am
0. &O
O
rnX
IM
N
TRDM WIH* M
U
4-11001
I 'J
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F ^ r m 118 b
T E L C GR A
FEDERAL RESERVE BOARD
WASHINGTON
T» 193S«
UflKay « cSAosp
Keeeage to t *Betara witfrmt proteet oar m iwlA
<3Mwl JLVvvVPS* *S6NttT®CI JMKFW HPQBI 55o**3*
McClelland.
33-2. - Iowa Dm Moines national Bask and Trust Co., Bee Moines,
Iowa*
F IL E COPY
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
Zf 1 0
(LEASED W IR E SERVICE)
RECEIVED A T WASHINGTON, D . C .
92gmr
Sail Francisco Mar 7 1040am
Board
Washington
Please advise if wire advice of Secretary of Treasurys regulations
have been sent to banks in territory of Alaska and Hawaii.
Hale
150p
z /7/35
v. 8. eovnymwrhwhw owoi: im^
2—11901
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F orm 118b
TELEGRAM
FEDERAL RESERVE BOARD
WASHINGTON
M arch 7 , 1933
Kale
r
-Sm
J^ J
Jfraacisco
I
T'
tour... telegram*
(Cabinet officers hairing jurisdiction ovsr respective
~ ’iU
rrlyi;-,r ^ ... ■
territories and insular possessions are baing requested to transmit
regulations to local -overniaents*
McClelland
EMM/fsf
i
F
OPT
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o r m 148 h
TELEGRA
rEDERAL RESERVE BO ARD
WASHINGTON
Martii 7, 1935
Youag - Bofiton
Harrison - Sew York
Borrl* - Philadelphia
Faaeher * Cleveland
Tm>m
/ ^ k O
Seay* Rietaond
Black - Atlanta
MoDougaX - Chleago
Martin - St* Louis
Geery * Minneapolis
Hamilton - Kansas Citj*
MeEtaney - Balias
Calkins - San Frmoiseo
Issuance of regulation re shipments of
ourxe*«y by federal reserve banka to banking institution* in order
to ask* such payments of e&sb as various regulations of Seersta^r
of Treasury pewit is under active consideration by Secretary of
Treasury etu* has not yet determined upon exact p&mseology STOP
You will be advised proaptly
McClelland
Reproduced from the Unclassified I Declassified Holdings of the National Archives
SJm aara Srpartnmtt
I
*
T E L E G R A P H O F F IC E
Received at Washington, D. C.
C90W S I 7
DESMOINES IOWA 5 3 4 P 7
FEDERAL RESERVE BANK
D I S T R I C T OF COLUMBIA WASHN DC
RETURN WITHOUT PROTEST OUR UNPAID CASH LETTERS
IOWA DESMOINES NATIONAL BANK AND TRUST COMPANY.
6$7P
Reproduced from the Unclassified I Declassified Holdings of the National Archives
No. 14.
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
March 7, 1933.
Under the authority conferred upon him by the Pres ide nt s
Proclamation of March 6, 1933, declaring a bank holiday, the
Secretary of the Treasury has issued the following regulation:
"Federal reserve banks are authorized to
conduct their normal and usual operations as
fiscal agents of the United States in transactions
pertaining to the exchange of obligations of the
United States, such as making exchange of denomina
tions, exchanging coupon for registered bonds,
and vice versa, receiving registered bonds for
transfer and effecting C. P. D. transactions."
Reproduced from the Unclassified I Declassified Holdings of the National Archives
No. 13
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
March 7, 1933.
Under the authority conferred upon him by the P r e s i d e n t s
Proclamation of March 6, 1933, declaring a bank holiday, the
Secretary of the Treasury has issued the following regulations
HAny banking institution lawfully engaged in the
business of acting as trustee, executor, administrator,
registrar of stocks and bonds, transfer agent, guardian
of estates, assignee, receiver, committee of estates of
lunatics, or in any other fiduciary capacity may con
tinue to transact such business in the normal and
usual manner; provided that in the conduct of said
business, except as may be permitted by other regula
tions of the Secretary of the Treasury, such banking
institution shall not pay out or permit the withdrawal
of coin or currency nor withdraw any trust or fiduciary
funds on deposit with any other department of the bank.”
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Ho* 12
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
March 7, 1933.
Under the authority conferred upon him by the P r e s i d e n t s proclar*
mation of March 6, 1933, declaring a bank holiday, the Secretary of the
Treasury has issued the following regulations:
"Clearing house associations and other associations or
ganized to provide an adequately secured medium of temporary
exchange, are hereby permitted to issue certificates against
sound assets of banking institutions, such certificate to be
deliverable by each institution to its creditors and depositors
on a pro rata basis, provided, however, that no such certificates
shall be issued before Friday, March 10, 1933, without the con
sent of the Secretary of the Treasury addressed to the clearing
house or other association proposing to issue such certificates,
and further provided that this permission may be revoked in
the event that a national plan to meet the existing emergency
is proposed by the Secretary of the Treasury if in his opinion
the success of such plan would be inconsistent with the
operation of the certificate plan."
Reproduced from the Unclassified I Declassified Holdings of the National Archives
4 n o
TBB&SUBT W BM Tm m
No. 11
K)R IMMEDIATE RELEASE
March 7, 1933,
Under the authority conferred upon the Secretary of the
Treasury by the P r e s i d e n t s Proclamation of March 6, 1933,
declaring a bank holiday, the Secretary of the Treasury
announces that any bank having a branch in a foreign country
may .^deposit collateral in the United States to secure ad
vances to such branch in a foreign country, provided such
transaction does not involve any transfer of credit from the
United States to a foreign country and any bank having a
branch in an insular possession of the United States may de
posit United States Government securities or other collateral
for a similar purpose when under the P re s i d e n t s Proclamation
advances of local currency in the insular possession may law*,
fully be made.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Ho. 9
TREASURY DEPARTMEMT
FOR IMMEDIATE RELEASE
March 7, 1933-
Under the authority conferred upon him by the President »s
Proclamation of March
6, 1933* declaring a bank holiday, the
Secretary of the Treasury has issued the following regulation:
"Any banking institution may deliver to the
person entitled thereto properly identified docu
ments and securities held by such institution for
safekeeping."
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TREASURY EEPARTIOTT
FOR IMMEDIATE RELEAS3
March 7, 1933-
Under the authority conferred upon him by the President’
s
proclamation of March 6, 1933* declaring a bank holiday, the
Secretary of the Treasury has issued the following regulation* '
"Where settlement for checks charged by drawee
institutions to the drawers* accounts on its books
on or before March H, 1933 is incomplete, settlement
may be completed w vere such settlement does not in
volve the Payment of money or currency.”
Reproduced from the Unclassified I Declassified Holdings of the National Archives
q i
if$3
Qnrtt**
fcWtBO
iS'UrTtttls*
tSeOlnre
*•« I * i*
!iie&B0f*$
f«*«5d
St* Loytl*
**iah
M lm
Wai tAfifet
newton
Atlanta
Bailey
1fliian*f&ULK
Mmt<®s*
Han fra&eieee
^
ff
fh m m p m m r* *#
* 4a f m t 4
m fair
Jw akB t> m
i k
s#
? ,1*jr/jr«»
on
iojsEorro* • lint
to hm mVrmt m
amlm* ^
« Specify tet*l g&itldm mA btiar^fel# $e*i«toift
fce
telegram
FEDERAL RESERVE SYSTEM
0* a w h >w i n k sbrvic *
RECEIVED A T WASHINGTON, D . C .
Richmond 220p ITar 6
Korrill
Washington
Referring to trans 1555, The following situations havebeen covered,
namely authorizing ail banks to make change and give access to safety
deposit boxes. The following should receive quick consideration,
namely payment of government checks and payment for revenue stamps*
The^latter is particularly irapOrtant in this iistrict
221 p
»»IW III— 1|—
t nm
Reproduced from the Unclassified I Declassified Holdings of the National Archives
1/
T E L E G R A P H O F F IC E
D 9 7 W SI
10^
Received at Washington, D. C.
'.VICHITA KANS 100P 6
EUGENE MEYER, GOV FED RES BOARD
WASHN DC
K I C H IT A CLEARING HOUSE A S S O C IA TIO N VIGOROUSLY PROTESTS ACTIO N OF
POST O F F IC E DEPARTMENT IN P E R M IT T IN G NORMAL OPERATION OF POSTAL
SAVING S DEPARTMENT IN C LU D IN G ACCEPTANCE AND WITHDRAWAL OF D E P O S IT S
ON T H IS NATIONAL HOLIDAY WHICH LOYAL BANKING IN S T IT U T IO N S ARE
OBSERVING TO THE LETTER STOP POSTAL SAVINGS DEPARTMENT HAS CONTRIBUTED
MORE TO PRESENT DEPLORABLE T IE U P OF A LL COMMERCIAL A C T I V IT Y THAN ANY
OTHER S IN G L E INFLUENCE STOP WE B E L IE V E POSTAL SAVINGS INTEREST RATES
SHOULD BE E IT H E R REDUCED TO MARKET OR INTEREST FEATURE D IS C O N T IN U E D
SHEET 2 W IC H IT A
_
„
„
S m a ttrg SfjrarfcttMtt
TELCORAPH OFFICE
Received at Washington, D. C.
E N T IR E L Y STOP '"E BEL I EVE GOVERNMENT IN PROCLAIMING HO LID A Y SHOULD
OBSERVE THAT H O L ID A Y IN IT S OTHER F IN A N C IA L DEPARTMENTS O F F E R IN S
A C T IV E C O M P E TITIO N TO MEMBER BANKS STOP WE REQUEST IM MEDIATE ACTIO N
W IC H IT A CLEARING HOUSE A S S O C IA T IO N .
Reproduced from the Unclassified / Declassified Holdings of the National Archives
7
.
r
y - U t.
f
••
Reproduced from the Unclassified / Declassified Holdings of the National Archives
TO MR. BOUNDS
FROM
J. ?I. C R V E .
^ ~ ]0
^ )j & I
Following are transactions involving foreign accounts on our books which
I think we should be permitted to put through during the holiday period with
the understanding that in no case shall they result in paying out gold or
currency or increasing the total amounts of gold which we hold earmarked for
foreign account:
1.
Transfers between foreign current accounts on our books.
2.
Transfers of bills and securities between foreign accounts
t/
on our books*
3.
Transfers of earmarked gold from one custody account to
another*
Receipt of sums due us from foreign correspondents whether in
dollars or gold*
Rel9ase t0 ua of gold held ^
earmark for foreien account
providing the proceeds in dollars are credited to foreign
accounts on our books*
j
flu
Credit to foreignRecounts on our books
U. 6. currency and
gold deposited with us*
^
Dictated over
*0,
f\S y * *
telephone from New York, 8:10 p.m. March 6. 1933*
t H i * 'V *«
V7^
SUGGESTED PERMISSIVE OPERATIONS DURING BANK HOLIDAY
1.
Permit access to safe deposit boxes.
2.
Permit making of change.
3*
Permit receiving deposits of currency and coin to be kept
segregated and payable on demand.
4.
Permit limited cash payments on a percentage basis to be
specified for current payroll purposes and other urgent
needs.
5.
Permit the use of checks on a specified limited basis which
will result in debiting and crediting accounts in the same
bank or in banks which may associate themselves for the
purpose of exchanging checks payable at the banks in the
group without involving currency payments.
6.
Permit receipt of payments in cash on unpledged bills re
ceivable or other asset items.
7.
Permit functioning as collection agents for items- such as
bill of lading drafts covering movement of livestock, food
stuffs, perishable produce and other commodities.
8.
Permit Federal Reserve Banks to carry on such operations as
they may find necessary to facilitate above enumerated
functions.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F o r m 1 18
to
TELEGRAM
,• i
i, - *
FEDERAL RESERVE BOARD
WASHINGTON
HardI 6, 19S3,
- Boston
B&rriso» - B mt fade
Hoisrts
ffcaeker • daroland
Seay - Hictomd
Blaok * Atlanta
MoDougal «* Obloago
JfertiB ~ St. Louis
iA'r
t t t& &B0U*tloas Issued fcy Secretary of tbs
t s
Oeexy - Mlaaeapolla
BaaslLlfcoi-t - Kansas City
JisKlxunsy -* Dallas
CaHdL&s • 3an Freneioco
tm m ury today osier
P r a a id a a t * * P r o c la im t i o n , o f i f c lc h y o u w a rs a& Tiaao. i n B o a r d 's t j ^ i p u a s , :
k& ys b «© n g iv e n t o t b s jgatmu w lt fc t&® e x c e p t io n t h o s * ( X) ija s t r t ie t ifc g
T r© a s u r e r o f tfe e U a ite d S t a t o s w itb . r a s p s o t t o p a y m e n ts, e t c . t { £ ) a u t h a r ix ia g
y © d « r a l r e s e p r e b o o k s t o o a k s t r a a s f a r s th ro u ^ fc g © M s a t t ls ift e n t *U»& f o r
a^oount of Treasurer, at#* g and (3) authorizing Federel reserve banks to
ptarg& aae n o M
o r spX 4 o e r t i f i c a t e c a n d p a y t h e r e f o r s a y o t l ie r tom o f © o ia
or Qurrouoy*
I t is madarstood that you * ill/eosaataicata ro&ilutio&s o&Ler
promptly
than those Mentioned above to all bonking institutions Is your district*
H & O e lla M
E COPY
Reproduced from the Unclassified / Declassified Holdings of the National Archives
TELEGRAM
' U /I
6
FEDERAL RESERVE SYSTEf
(LEASED W IR E SERVICE)
38bhb
RECEIVED A T WASHINGTON, D . C .
Iv'ewYork KY 418pn Kar 6 th
Washington DO
We are advised that a serious situation exists in Havana,Cuba,
where thexve are brenches of Aclerican and Canadian banks and where
the only currency in circulation is American currency* A holiday has
been declared there until Thursday morning and some of the banks having
branches there feel that local conditions in Cuba raay prevent a
prolongation
St&ajc&MStSSSt/of the holiday. Therefore they ere anxious to replenish
their stock of American currency in Havana ag?;inst payment therefor
in KewYork, it. specific case is the Canadian 3ank of Commerce which
desires to pay 4*1,000,000 gold to us against the issuance to then in
Havana of 01,000,000 federal Reserve Notes by the Havana branch of
the Fediral Reserve Bank of Atlanta. \.e believe that this is one
Reproduced from the Unclassified / Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(LEASED W IR E S E R V IC E
RECEIVED A T WASHINGTON, D . C .
sort of a transaction which should be permitted to federal lieserve
3anks by the secretary of the Treasury under the authority and
power granted him by the President’
s proclamation. It really is a
purchase of gold to be paid for by Federal Reserve Notes.
J H Case
Ohairv,ian,federal Reserve Bank
425pn
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Fe d e r a l R e s e r v e B a n k
o f New Y o rk
March 6, 19 br6
3 1 r s:
We take pleasure in enclosing copy of a letter
dated-March 6, from the National City Bank of New York,
which we transmitted by telephone today through Mr. Hounds
who has doubtless stated that we see no objection to the
granting by the Secretary of the Treasury of the request
contained in the said letter from the National City Bank.
Faithfully yours,
Federal Reserve Board
Washington, D. C
Reproduced from the Unclassified I Declassified Holdings of the National Archives
C O P Y
THE NATIONAL CITY BANK OF NEW YORK
NEW YORK
/
March 6, 1933.
In replying please quote initials BCH
Federal Reserve Bank of New York,
33 Liberty Street,
New York City,
Gentlemen;
The proclamation of the President of the United States
declaring a holiday does not apply to the Branches of this Bank in
foreign countries. Due to the extraordinary situation in the United
States we anticipate that our depositors in foreign countries may
wish to withdraw their balances from our Branches, and we wish to be
prepared to meet any emergencies. The Hongkong & Shanghai Banking
Corporation and the Chartered Bank of India, Australia and China, and
'the Philippine National Bank have kindly offered to make us advances
of local currency in the countries where they are located and where we
have branches, the said advances to us to be secured by deposit here
of United States Government securities, to be delivered to the New York
agencies of the Banks named.
We will greatly appreciate it if you will transmit to the
Secretary of the Treasury a request granting us authority to deposit
up to $15,000,000. of United States Government securities, which are
to be used to secure advances in local currencies in India, Straits
Settlements, China, Japan, Manchuria and the Philippine Islands.
The obligations which we assume in connection with these requests
are, of course, to be repaid in foreign currencies.
Although the Philippine Islands come under the P re si d e n t s
proclamation and our Branches are not open there, it is to be re
membered when the holidays expire our Philippine Branches will be open
twenty-four hours before New York banks on account of the difference
in time and it is to prepare for any emergency that may arise in that
twenty-four hours that we ask that the authorization apply to transac
tions with the Philippine National Bank and the Philippine Islands.
Authorization to us to make the deposit of the above securi
ties should also include authority for the Banks mentioned to receive
the securities.
Appreciating your cooperation in this matter, we remain
Yours very truly,
(Signed) Boies C. Hart
Vice President.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
March 6, 19330
Federal Reserve Bank
of New York,
New York, N.Y.
Gentlemen:
The Proclamation of the President of the United States
declaring a holiday does not apply to the branches of this bank
in foreign countries. Due to the extraordinary situation in the
United States we anticipate that out depositors' in foreign
countries may wish to withdraw their balances from our branches,
and we wish to be prepared to meet any emergencies. The Hong
Kong and Shanghai Banking Corporation and the Chartered Banlssof
India, Australia and China, and the Phillipine National Bank
have kindly offered to make us advances of local currency in
the countries where they are located and where we have branches,
the said advances to us to be secured by deposit here of United
States Government securities, to be delivered to the New York
agencies of the banks named.
We will greatly appreciate it if you will transmit to
the Secretary of the Treasury a request granting us authority
to deposit up to #15,000,000 of United States Government securi
ties, which are to be used to secure advances in local currencies
in India, Straits Settlements, China, Japan, Manchuria and the
Phillipine Islands. The obligations which we assume in connec
tion with these requests are, of course, to be repaid in foreign
currencies.
Although the Phillipine Islands come under the President*
Proclamation and our branches are not open there, it is to be
remembered when the holidays expire our Phillipine branches will
be open twenty-four hours before New York banks on account of
the difference in time and it is to prepare for any.emergency
that may arise in that twenty-four hours that we ask that the
authorization apply to transactions with the Phillipine National
Bank and the Phillipine Islands.
Authorization to us to make the deposit of the above
securities should also include authority for the banks mentioned
to receive the securities.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Federal Reserve Bank of New York*
Appreciating your cooperation in this matter, we remain
Yours very truly,
BOIES C. HART,
Vice President,
National City Bank,
New York City.
Reproduced from the Unclassified / Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(L E A S E D W IR E S E R V IC E )
27bhb
R E C E IV E D A T W A S H IN G T O N , D . C .
New York NY 412 p Mar 6
Morrill
Was hington
?>| U ^ *Vj;
Replying further to your telegramjwe suggest Federal Reserve
Banks should be authorized to perform such operations as may be
reasonably necessary to facilitate the operations of other banking
institutions as permitted by regulation. We believe that authorization
in this general form would be preferable to enumeration of specific
powers,as it is difficult to anticipate and define all Federal
Reserve Bank operations that would be necessary♦ We assume,however,
that regulations would contain specific prohibition against Federal
Reserve Banks making (A) any payments or transfers of gold or bullion,
and (B) any payments of coin or currency except to banks and in
limited amounts and to meet urgent requirements.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TELEGRAM
FEDERAL RESERVE SYSTEM
(UEASED W IR E SERVICE)
Sheet #2
RECEIVED A T WASHINGTON, D . C .
In order to avoid complications in connection with checks
forwarded by mail and charged to the makers accounts on or before
iiarch 3,1933,we believe that collecting banks,including Federal
Reserve Banks,should be authorized to charge to reuitting banks
accounts remittance drafts drawn on and received by the collecting
banks for sucji checks.
Case
Burgess and Logan
419pm
* c. «oT«miiNT nm riw mmm ttm
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TBEASIflft DEPARTMM?
K)& Jita&iATE PLEASE
March 6, 1933*
Under the authority conferred upon M m by the president’
s Procla
mation of March 6, 1933» declaring a bank holiday, the Secretary of the
Treasury has issued the following regulations:
"Deposits heretofore received by any banking institution
pursuant to agreement or legislative authority providing for
segregation and for repayment without restriction may be paid
on demand.
Any banking institution which was lawfully engaged
in the business of receiving deposits prior to March 6, 1933*
may create special trust accounts for the receipt of new
deposits which shall be subject to withdrawal on demand without
any restriction or limitation and shall be kept separately in
cash or on deposit in Federal Reserve Banks or invested in
obligations of the United States.
Federal reserve banks may
open special accounts on their books for their member banks
and temporarily for non-member b$nks and may receive in such
special accounts the proceeds of new deposits received by such
banking institutions.
In making deposits with the Federal
reserve bank pursuant to this regulation the depositing bank
shall in the case of each deposit indicate to the Federal
reserve bank- by symbol or otherwise that the funds so deposited
represent new deposits made under this regulation.
Upon receipt
of such deposits such Federal reserve bank shall credit the same
in the special account of the depositing bank herein provided
for and shall hold the same solely for repayment to such bank.
Federal reserve banks shall permit the withdrawal of any part
m
o ,
Reproduced from the Unclassified I Declassified Holdings of the National Archives
ITo. 7
-
2
-
or all of such new deposits by the depositing bank without
restriction provided that the depositing banlc shall in such
order or request for withdrawal indicate to the Federal
reserve bank by symbol or otherwise that such withdrawal is
to be made froim such special account, provided however that
no banking institution shall pay out or permit the withdrawal
of any gold or gold certificates.”
Reproduced from the Unclassified I Declassified Holdings of the National Archives
C P
No. 6
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
March 6, 1933*
Under the authority conferred upon him by the President’
s
Proclamation of March 6, 1933* declaring a bank holiday, the
Secretary of the Treasury has issued the following regulation:
MAny banking institution may handle and collect
t
drafts or •ther documents in connection with the
shipment, transportation or delivery of food or feed
products, may pay out or permit the withdrawal of
such amounts of currency as shall be necessary in
the judgment of such banking institution in
connection with such shipment, transportation or
delivery of fo«d or feed products, and may perform
such other banking functions as may be essential to
the shipment, transportation or delivery of food or
feed products, provided, however, that no banking
institution shall pay out or permit the withdrawal
of any gold or gold certificates.”
Reprb'duced from the Unclassified I Declassified Holdings o flh e 'N a tid fi^iW V e s
t+ l o .
F o r m 1 48
TELEGRAM
FE D E R A L RESERVE BOARD
LEASED W IRE SERVICE
W A S H IN G TO N
March
4, 1933
2- 9*M
Federal R eserve Bank of*
Richmond
Atlanta
Chicago
St. Louis
Boston
Hew York
Philadelphia
Cleveland
Minneapolis
Kansas City
Dallas
San Francisco
TRANS /j T 3 The following proclamation by the President of the United
States should immediately be brought to the attention of the Governor
and the Chairman of the banks
QUOTE:
&33 MAR 5
58
BY THE PRESIDENT OF THE UNITED STATES OF AMERICA
A PROCLAMATION
WHEREAS there have been heavy and unwarranted withdrawals of
gold and currency from our banking institutions for the purpose of
hoarding; and
WHEREAS continuous and increasingly extensive speculative
activity abroad in foreign exchange has resulted in severe drains
on the Nation's stocks of gold; and
WHEREAS these conditions have created a national emergency;
and
WHEREAS it ia in the best interests of all bank depositors
that a period of respite be provided with a view to preventing
-further hoarding of coin, bullion or currency or speculation in
foreign exchange and permitting the application of appropriate
measures to protect the interests of our people; and
WHEREAS it is provided in Section 5(b) of the Act of October
6, 19X7 (40 Stat#L«41l) as emended, “That the President may inv©a~
tigate, regulate, or prohibit, under such rules and regulations as
he may prescribe, by means of licenses or otherwise, any transact
tlons in foreign exchange and the export, hoarding, melting, or
earmarkings of gold or silver coin or bullion or currency ***»;
and
WHEREAS it is provided in Section 16 of the said Act "that
whoever shall willfully violate any of the provisions of this Act
or of any license, rule, or regulation issued thereunder, and who
ever shall willfully violate, neglect, or refuse to comply with
any order of the President issued in compliance with the provisions
of this Act, shall, upon conviction, be fined not more than $10,000,
or, if a natural person, imprisoned for not more than ten years, or
both; ***";
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Ml o*
No. 5
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
March 6 1933
,
*
Under the authority conferred upon him "by the President’
s
proclamation of March 6, 1933» declaring a bank holiday, the
Secretary of the Treasury has issued the following regulation:
"Any banking institution may.accept
payments in cash or any other form acceptable to it on account or in settlement of
obligations payable at or to such institu
tion.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
No. 4
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
March 6, 1933.
Under the authority conferred -upon him by the
Presi de nts proclamation of March 6, 1933, declaring a
bank holiday, the Secretary of the Treasury has issued
the following regulation:
nAll banking institutions may continue,
in accordance with usual practice, to cash
checks drawn on the Treasurer of the United
States, provided that no gold or gold certifi
cates shall be paid out. 11
Reproduced from the Unclassified I Declassified Holdings of the National Archives
ITo. 3
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
Monday, March 6, 1933,
Under the authority conferred upon him "by the Pr es idents
Proclamation of March 6, 1933, declaring a bank holiday, the
Secretary of the Treasury has issued the following regulations
’
’
All hanking institutions may upon re
quest return intact and without restriction
all cash, checks, and other items delivered
for deposit or collection which were received
after the last closing of business hours and
have not been entered on the books of such
banking institution.”
Reproduced from the Unclassified I Declassified Holdings of the National Archives
No. 2
TREASURY DEPARTMENT
FOR IMMEDIATE RELEASE
March 6, 1933.
Under the authority conferred upon him "by the Pr esidents
proclamation of March 6, 1933, declaring a hank holiday, the
Secretary of the Treasury has issued the following regulation:
nAll hanking institutions may allow
their customers free access *to the safety
deposit boxes and safes rented to such
customers.11
Reproduced from the Unclassified / Declassified Holdings of the National Archives
Ko. 1
FOR IMMEDIATE RELEASE
Monday, March 6, 1933.
Ujider the authority conferred upon him by the President’
s
Proclamation of March 6, 1933, declaring a bank holiday, the
Secretary of the Treasury has authorized all Federal reserve
banks and all other banking institutions to make change by
the exchange of currency and/or coin of -various denominations
for an exactly equal amount of currency and/or coin of other
denominations, but no gold or gold certificates shall be paid
out in making change.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
FEDERAL RESERVE BOARD
f
WASHINGTON
X-7355
AD D RESS O FFICIAL CORRESPONDENCE TO
March 6, 1933.
TH E FEDERAL RESERVE BOARD
(lard si
Bear Sir:
In confirmation of the Board’
s telegram of this date,^there is
inclosed herewith, for your information, a copy of the proclamation which
was issued hy the President of the United States early this morniAg*
This letter also confirms the later telegram, addressed jointly
io the Chairman and Governor of the Bazik, requesting immediate wire ad
vice of your suggestions as to provisions that should he included in
the regulations to he issued "by the Secretary of the {Treasury in
accordance with clauses lettered (a) (h) and (c) in the President*s
proclamation, which suggestions should relate to the operations of hoth
the Federal reserve hanks and other harikltig institutions* as defined in
the proclamation*
This telegram also suggested that arrangements he
made to send promptly to all other Federal reserve "banks and the Board
several sets of each plan of procedure an£' forms that may he devised hy
In c lo s u r e ,
TO GOVERNORS AND CHAIRMEN GBP ALL I . R. RANKS.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Circular lette.
<f
f
,0 all/.j^Gover
Governors
N
and Chairmen J
FEDERAL RESERVE BOARD
WASHINGTON
ADDRESS OFFICIAL, CORRESPONDENCE TO
THE FEDERAL. RESERVE BOARD
March 6, 1933
Dear Sir?
In confirmation of the Board* s telegram of this date,
there is inclosed herewith, for your information, a copy of the
proclamation which was issued by the President of the United
States early this morning.
^his letter also confirms the later telegram, addressed
jointly to the Chairman and Governor of the Bank, requesting im
mediate wire advice of your suggestions as to provisions that
should be included in the regulations to be issued by the Secretary
of the Treasury in accordance with clauses lettered (a) (b) and (c)
in *the President* s proclamation, which suggestions should relate to the
operations of both the Federal reserve banks and other banking insti
tutions as defined in the proclamation.
This telegram also sug
gested that arrangements be made to send promptly to all other
Federal reserve banks and the Board several sets of each plan of
procedure and forms that may be devised by clearing houses in prin
cipal cities in your district in connection with the use of clearing
house script or certificates.
Very truly yours,
El' M. McClellancJ,
Ass Sst&nt -'Secretary
Reproduced from the Unclassified I Declassified Holdings of the National Archives
BY THE PHLSEDE&D OW TEE UI7ITED STATES OE AI.IERICA
'A PROCLAUATION
WHEKEAS tliere have been heavy and unwarranted withdrawals of
gold and currency from our banking institutions for the purpose of
hoarding; and
WHEREAS continuous and increasingly extensive speculative
activity abroad in foreign exchange has resulted in severe drains
on the Uationfs stocks of gold; and
WHEKEAS these conditions have created a national emergency;
and
WHEREAS it is in the best interests of all bank depositors
that a period of respite be provided with a view to preventing
further hoarding of coin, bullion or currency or speculation in
foreign exchange and permitting the application of appropriate
measures to protect the interests of our people; and
WHEREAS it is provided in Section 5(b) of the Act of October
6, 1917 (40 Stat.L.411) as amended, ’
’
That the President may inves
tigate, regulate, or. prohibit, under such rules and regulations as
he may prescribe, by means of licenses or otherwise, any transac
tions in foreign exchange and the export, hoarding, melting, or
earmarkings of gold or silver coin or bullion or currency
and
WHEREAS it is provided in Section 16 of the said Act ,fthat
whoever shall willfully violate any of the provisions of this Act
or of any license, rule, or regulation issued thereunder, and who
ever shall willfully violate, neglect, or refuse to comply with
any order of the President issued in compliance with the provision®
of this Act, shall, upon conviction, be fined not more than $10j000,
or, if a natural person, imprisoned for not more than ten years, or
both; ***»;
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-
2
-
NOW, THEJWOHE, I, I S A f i m V D . 300SEVELT, President of the
United States of America, in view of such, national emergency and by
virtue of the authority vested in me by said Act and in order to
prevent the export, hoarding, or earmarking of gold or silver
coin or bullion or currency, do hereby proclaim, order, direct and
declare that from Monday, the sixth day of March, to Thursday, the
ninth day of March, Nineteen Hundred and Thirty Three, both dates
inclusive, there shall be maintained and observed by all banking
institutions and all branches thereof located in the United States
of America, including the territories and insular possessions, a
bank holiday, and that during said period all banking transactions
shall be suspended. ^ D u r i n g such holiday, excepting as hereinafter
provided, no such bsmking institution or branch shall pay out, ex
port, earmark, or permit the withdrawal or transfer in any manner
or by any device whatsoever, of any gold or silver coin or bullion
or currency or take any other action which might facilitate the
hoarding thereof; nor shall any such banking institution or branch
pay out deposits* make loans or discounts, deal in foreign ex
change, transfer credits from the United States to any place
abroad, or transact any other banking business whatsoever.
During such holiday, the Secretary of the Treasury, with the
approval of the President and -under such regulations as he may
prescribe, is aphorized and empowered (a) to permit any or all
of such banking institutions to perform any or all of the usual
banking functions, (b) to direct, require or permit the issuance
of clearing house certificates or other evidences of claims against
assets of banking institutions, and (c)
to authorize and direct the
creation in such banking institutions of special trust accounts for
the receipt of new deposits which shall be subjoct to withdrawal on
demand without any restriction or limitation and shall be kept
separately in cash or on deposit in federal Reserve Banks or in
vested in obligations of the United States,
Reproduced from the Unclassified I Declassified Holdings of the National Archives
- 3 -
As used in this order the term Mbanki:ig institutions”shall
include all Federal Reserve banks, natio nal banking associations,
hanks, trust companies, savings banks, building and loan asso
ciations, credit unions, or other corporations, partnerships,
associations or persons, engaged in the business of receiving
deposits, making loans, discounting business paper, or trans
acting any other form of banking business*
IN WITNESS WHEKEOE, I have hereunto set my hand and caused
the seal of the United States to be affixed.
Done in the City of Washington this 6th day of March - 1 A.M.
in the year of our Lord One Thousand Nine
Hundred and Thirty-three, and of the Inde(SEAL)
pendence of the United States the One
Hundred and Fifty-seventh.
FRAJ'TKLIU D. ROOSEVELT
By the President:
CORDELL HULL
Secretary of State
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Form 148
telegram
FEDERAL RESERVE b o a r d
L E A S E D W IR E S E R V I C E
W A S H IN G T O N
-
2—MM
2-
NOIT, OEEHEFOKE, I, M E f f l D. BOOSEVELT, President of the
United States of .America, in view of suck national emergency and by
virtue of the authority vested in me by said Act and in order to
prevent the export, hoarding, or earmarking of gold or silver
coin er bullion or currency, do hereby proclaim, order, direct and
declare that from. Monday, the sixth day of March, to Thursday, the
ninth day of March, Nineteen Hundred and Thirty Three, both dates
inclusive, there shall be maintained and observed by all banking
institutions and all branches thereof located in the Ufcited States
of imerica, including the territories and insular possessions, a
.bank holiday, and that during said period all banking transactions
shall be suspended.
During such holiday, excepting as hereinafter
provided, no such banking institution or branch shall pay out, ex
port, earmark, or permit the withdrawal or transfer in any manner
or b y any device whatsoever, of any gold or silver coin or bullion
or currency or take any other action which might facilitate the
hoarding thereof; nor shall any such banking institution or branch
pay out deposits, make loans or discounts, deal in foreign ex
change, transfer credits from -fixe United States to any place
abroad, or transact any other banking business whatsoever.
During such holiday, the Secretary of the Treasury, with the
approval of the President and under such regulations as he may
prescribe, is authorized and empowered (a) to pennit any or all
of such banking institutions to perform any or all of the usual
banking functions, (b) to direct, require or penait the issuance
of clearing house certificates or other evidences of claims against
assets of banking Institutions, and (c) to authorize and direct the
creation in such banking institutions of special trust accounts for
the receipt of new deposits which shall be subject to withdrawal on
demand without any restriction or limitation and shall be kept
separately in cash or on deposit in Federal Reserve Banks or in
http://fraser.stlouisfed.org/ vested
Federal Reserve Bank of St. Louis
in obligations of the United States*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Formal
TELEGRAM
FEDERAL. R E S E R V E BOARD
L E A S E D W IR E S E R V I C E
2-**4 •ra
WASHINGTON
- 3 -
As used in this order the term nbanking institutions” shall
include all Federal Beserve banks, national banking associations,
banks, trust companies, savings banks, building and loan asso
ciations, credit unions, or other corporations, partnerships,
associations or persons, engaged in the business of receiving
deposits, making loans, discounting business paper, or trans
acting any other form of banking business.
IN WITNESS WHEREOF, I have hereunto set my hand and caused
the seal of the United States to be affixed.
Done in the City of Washington this 6th day of March — 1 A.M.
in the year of our Lord One Thousand Nine
(SEAL)
Hundred and Thirty—three, and of the Inde
pendence of the United States the One
Hundred and Fifty-seventh.
5EANKUN D. ROOSEVELT
By the Presidents
COBDELL HULL
Secretary of State
UNQUOTE
Morrill
Reproduced from the Unclassified / Declassified Holdings of the National Archives
0 t~f't
iMaroh 5 # 193S*
J,,
J.
SKELETON QUYLHIK
(j
(Details and explanations omitted)
1«
Tttiftifft of « X M u t i v t o r d w by President declaring benk holiday
for thro* days* during whloh all payments by banking institution* Federal
reserve banks end Postal Savings System are suspended, but providing for
resumption of payasnts at and of holiday subject to limitations and
restrictions to ba proscribed by regulation*
2«
Ettaetaent by Congress of Joint resolution ratifying eseoutlve
order and authorising the President to extend the affective period thereof,
to aasnd the exooutive order and to issue similar executive orders froa
time to time*
8*
Resumption of U n i t e d payaanta by oosanaroial banks* Federal re*
serve banks and Postal Savings System subject to 1 led tat ions and res trio*
tions prescribed pursuant to executive order*
4«
Perait Federal reserve banks and o c M e r c l a l banks bolding new
deposits reoeired as trust funds to iarrsst sans in Government obligations
and make the neoeasary payaanta to the Ooseranent*
(Consider permitting
all depositors to utilise as nueh of deposits as may be necessary to meet
obligations due to the O o v e n a w n t of the United States, including inooae
taxes*)
5«
ttnaetaant by Congress of joint resolution authorising Issuance
of emergency currency by clearing house assooiatlons and similar organise*
tions against 75 per oent of sound bank assets under supervision of federal
Kosenre Agent e - s u c h wmsrgcnny surrsnoy to bo guaranteed by tho Oovernaasl
i
I&
Reproduced from the Unclassified I Declassified Holdings of the National Archives
.2*
of tha United States*
6«
Enactment by Congraae of National Bank Conaamration Aat author*
isins Coaptrol Iar of tha Currency to appoint ©onaerrators for all banka*
State and nationals to permit withdrawals of dapoaita on rastrlotad baaia
and rwoaipt of new dapoaita to ba aegregated aa truat fund* and repayable
In falli to ll<|uidata Insolvent banka# to permit aolrent banka to raopacx#
and to parnit recapitalisation or reorganisation of banka whoae aolrenoy
la questionable*
7*
Permit banka to ooatlnua making U n i t e d payments undor restrictions
preaorlbed pursuant to exeoutive ordar until ooneertmtora oan bo appointad#
than parnit thaw to allow withdrawal of dapoaita on raatrlotad baaia and
reoelve and aagragata now dapoaita rapayabla In full# until it oan bo da*
terwined whether they should ba permitted to reopen or ahould bo required
to liquidate* raoapitallsa or reorganise*
(2a c o m oaaaa tha oonaervatora
oould ba raliable bank offlaara and in soaa oaaaa bank aacaainera*
k a ingle
bank examiner oould ba appointad oonaarvator of all banka in a given oosa■unity and oould aalaat hia oan deputiee to auperrlae and oontrol limited
o per at Iona of eaah bank in hia handa*)
•«
tflth banka in tha hand* of oonaerratora, proceed to work out tha
situation gradually along tha foil owing lineat
(a)
Banka of unqueatloned solrenoy to ba permitted to reopan
an unraatrietad baaia whan public hyataria has aubaidad stiff loi»
ently and to ba aidad by laauanoa o f emergency currency and by
loana from tha Federal raaarve banka and fteoonatruotion Finance
Corporation, with tha understanding that they will pay out 0m&r~
Reproduced from the Unclassified I Declassified Holdings of the National Archives
g«ooy currency *• far m
possible and return othir f o r m of
oorronoy and gold to Fodoral reserve bank*.
(b)
Appoint rooolwora *a i m b * o poeelble to liquidate all
hopoleealy insolvent banks*
(•)
As to banks who** solvcsuiy 1« questionable, proceed with
asslotaaoo of depositors* ooonlttooa to deternJLne whether thoy
o m I t reoapltalisod or reorganised on «n unqueetl onafely solvent
basis*
If so* perait theea to roopon*
to liquidate thea*
If not, appoint reooivers
(Eeoapltallsatlon could bo assisted by pro*
visions for issuanoe of preferred stook exenpted froa double
liability sod assessments*)
Reproduced from the Unclassified I Declassified Holdings of the National Archives
FEDERAL RESER VE BANK OF CHICAGO
230
OFFICE
CHAIRMAN
FEDERAL
SOUTH
LASALLE
STREET
O FTHE
OF T H E B O A R D AND
RESERVE
March 4, 1933
AGENT
Federal Reserve Board,
Washington, D. C.
Gentlemen:
Referring to my telephone message of last night
to Mr. Morrill, I am enclosing herewith copy of resolution
of the Executive Committee of our Board of Directors which
was passed last night, and which I dictated to Mr. Morrill
over the telephone.
Very ti
EMS FC
Reproduced from the Unclassified I Declassified Holdings of the National Archives
WHEREAS, the Executive Committee of the Board of Directors of the
Federal Reserve Bank of Chicago believes that the continuation of
the withdrawal of currency and gold from the banks of the country
has created a national emergency which requires immediate action, and
WHEREAS, it appears that adequate measures cannot be enacted to remedy
this situation unless governmental authorities act tonight,
BOW, THEREFORE, BE If RESOLVED that because of this emergency, it is the
sense of this Committee that the Federal Reserve Board should urge
upon the President of the Inited States that he immediately' declare
a bank holiday for Saturday, March 4, and Monday, March 6, in order to
give the banks and the governmental authorities sufficient time and an
opportunity to provide the necessaiy measures for the protection of
the public interest, and so that adequate banking and credit facilities
may be provided as promptly as possible for the entire nation.
Reproduced from the Unclassified / Declassified Holdings of the National Archives
f■ f
V
*4
f
Vf
J' '
V»\V:%,
’
>0■
:v V
.1
kjfi^
VV
rF e
Fd
n FeRrAail RRceQsFeDr\ v/ er R
k ik
lt
B aa n
o f
N
e w
Y
o r k
y
.March 4, 1935*
Sir:
Enclosed is copy of a resolution adopted by the
board of directors of the Federal Reserve Bank of New York
at & special meeting held March 5, 1953, the text of which
was telephoned to your office last night*
Yours faithfully,
Honorable Eugene Meyer,
Governor, Federal Reserve Board,
Washington, D. C.
She.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
•IP,
RESOLUTION ADOPTED BY THE BOARD OF DIRECTORS OF THE
FEDERAL RESERVE BANK OF NEW YORK AT A SPECIAL MEETING HELD MARCH 5, 1955
WHEREAS
in the opinion of the board of directors of the
Federal Reserve Bank of New York the continued and increasing withdrawal
of currency and gold from the banks of the country has now created a
national emergency; and
WHEREAS
it is understood that adequate remedial measures
cannot be enacted before tomorrow morning; now therefore be it
RESOLVED
that in this emergency the Federal Reserve Board
is heret?y requested to urge the President of the United States to declare
a bank holiday Saturday, March 4 and Monday, March 6, in order to afford
opportunity to Governmental authorities and the banks themselves, to take
such measures as may be necessary to protect the interests of the people
and promptly to provide adequate banking and credit facilities for all
parts of the country.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
I On
T H E W H I T E HOUSE
W A S H IN G T O N
March. 4, 19 3 3
Hon, E u g e n e M e y e r
Federal Reserve Board
W a s h i n g to n, D . G ,
M y d e a r G o v e r n o r Meyer:
I r e c e i v e d at h a l f p a s t o ne t h i s
morning
latter
M«r^
I must assume
that thi s l e t t e r wa s w r i t t e n on the b a s i s of i n f o r m a
t i o n r e c e i v e d b y y o u p r i o r to 1 1 . 3 0 o 1 c l o c k la s t n i g h t
f o r t h e r e a s o n that b e f o r e y o u r l e t t e r w a s sent y o u
h a d c e r t a i n i n f o r m a t i o n as f o ll ow s:
a. At 11 o* c l o c k l a s t n i g h t the P r e s i d e n t
e le ct h a d i n f o r m e d me h e d i d not w i s h s uc h a p r o c l a m a t i o n
is sued.
b. The A t t o r n e y G e n e r a l h a d r e n e w e d the
same o p i n i o n w h i c h h e h a d a l r e a d y g i v e n to the B o a r d t h a t
the a u t h o r i t i e s o n w h i c h y o u were r e l y i n g w e r e i n a d e q u a t e
u n l e s s s u p p o r t e d b y the i n c o m i n g A d m i n i s t r a t i o n .
c. Th a t g r o u p s of r e p r e s e n t a t i v e b a n k e r s
in b o t h C h i c a g o a n d N ew York, e m b r a c i n g m e m b e r s of the
B o a r d o f D i r e c t o r s of the F e d e r a l R e s e r v e B a n k s in those
cities, w e r e then i n c o n f e r e n c e w i t h t h e g o v e r n o r s of the
st at es of I l l i n o i s a n d N e w York, a n d that t h e g o v e r n o r s
of t h e s e t w o st ate s w e r e p r e p a r e d to act if t h e s e r e p r e
s e n t a t i v e g r o u p s so r e c o m m e n d e d .
It a p p e a r s that the
g o v e r n o r s d i d take a c t i o n u n d e r their a u t h o r i t i e s , d e
cl a r i n g a t e m p o r a r y h o l i d a y in t h e s e two c r i t i c a l s t a t e s ,
a n d t h u s a c c o m p l i s h i n g the m a j o r p u r p o s e s w h i c h the B o a r d
a p p a r e n t l y h a d in m i n d *
In v i e w of the a b o v e I a m at a loss to
u n d e r s t a n d w h y s u c h a c o m m u n i c a t i o n s h o u l d h a v e b e e n sent
to me in t h e last f e w h o u r s of t h i s A d m i n i s t r a t i o n , w h i c h
I b e l i e v e t h e B o a r d m u s t n o w a dm it w a s n e i t h e r j u s t i f i e d
nor necessary.
Yours faithfully,
R ep rod uced from the U nclassified
I D eclassified H oldings of the N ational A rchives
Tfc* Pr*ild«rvt#
th* Ihtt* Bow**«
Dear Mr* Pro*ld*:rtt
Th* Federal a***rr* Soard ha* b**» is *«salon again thl«
•▼anlng iwUralng *h* lat*#t r*pori* of d*r*lopwat»*
Th# *ltnati 0sa
a* r*portod fran Chicago ha* r*a«h*d th* point of axtroia* tanslom,
with pro*p*ot§ that by th* «»d of banking hour* tor>;rrcw the- gold
r e * « m i of th* F*d«ral $***rra Bank of Chicago will b* dang*rou«ly
d*pl*t*d,
t*$r*aa»tatl** bankar* ar* a»***bl®d th*r* tonight and
hair* !*•$*•*i*d that a mtlenal h*lld*gr b* pro*lal»*d a* th« only
method tb*y tan** « f dealing with tho tnmadiat* aidgasoy
3j^{:':
th*y ar® oonfrantod*
Th«r® is anolo*ed a oopy of a r®*oit*tl©i adeptad by th*
Board of
saasloxw
of th* F« oral i£e*arr* Bank of !<*w York#
This r**olutlon *peak* far ltaalf a* to th*
m
l»
MomYork
•ltuation,
similar ©«Rditl©»* ar® dovaloflng rapidly lc othar
r*daral r©a*rv« di«trlo%a*
Th® Fadaral H«*arva Board hat oonaldarad two aothod* of
doalli£ idth thl* *a#rg*oe(y#
&mby
^coowfcltw ©rd*r and th$ othar
Reproduced from the Unclassified I Declassified Holdings of the National Archives
%
fbm S»a»t# hairing adjmirnod
|oiist r^oolutlon of G*sgr««s«
tmr th» dagfi tin# laoaoaoo # f an «*»eetive «r4ir
ot&y altornailTO to moot
laraediata situation.
to bo th«
A f o m of
osoootlvo o r i r t« oneleoodt for your ®on*id»rmtion*
>Tlio Patoiwl Booarto Board fool* that It oazroot too
rtroiagly «rfO that til# oitiamtion hao roaehod a point A e r o f c m o & U t o
action 1« n»e#**ajry to ppm m t a fcaBl&Jig collopoo*
He*peotfully#
SovomoF*
P* S#
Slzieo thl* Xottor « m
diotatod, thor© has boos
COOMMMlOavOCl vQ HO* OQf 1^spo03B»e O ft 00112X2022 auQp$Oa Djf t w
K**ootl*o CoMftlttoo of th# Fodoral iooorvo Bonk of Chicago, oow
la m i U i i *
Ixiolo*
A oofy of thl* resolutional ao Is eraloood*
7i
Reproduced from the Unclassified I Declassified Holdings of the National Archives
11:20 A.M.
Mr, Case advises following:
Federal Reserve Bank of Chicago - $150,000,000
They have elected to rediscount.
Federal Reserve Bank of Boston -
$20 ,000,000
They were going to rediscount —
buying bankers acceptances.
now considering
Federal Reserve Bank of St. Louis - $15,000,000
Not deteimined — may buy bills.
Cleveland - $50,000,000 —
Richmond - $10,000,000 —
directors are considering the matter,
directors are considering the matter.
Mr. Case expects to hear from the others during the next hour and
will advise promptly.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
m
o .
T /
2:45 P.M.
Mr. Case’
s office phoned following:
Chicago will rediscount
$150,000,000
St. Louis "
15.000.000
Cleveland "
25.000.000
n
25.000.000 Governments
buy
Richmond
10.000.000 bills
Boston
20,000«000 (ttul ilUlermineTTJ
245,000,000
J
b n /
V
V
fc o
, , ___________
7 § 'V
A A W
L '
A
i - 1 •'
V—
/
f t
^
Reproduced from the Unclassified I Declassified Holdings of the National Archives
H 7 0 *
March
The Par©aidant,
The White Houae,
Wartiington, D. C,
Z,
1933.
Dear Mr, Preaid ant!
The Board haa received and carefully considered your
letter of Febiuaxy 88, 1953.
In raaponae to your fir at intjiiry, the Board haa re
created me to advlae you that it la not at thla time prepared to
recommend any fern of Federal guarantee of banking dapoaita.
You
are, of oaurae, thoroughly familiar with the fciatory of auch ex
periment a in aome of the Statea and the inherent dangera in a propoaal of thla kind*
With reapect to your aecond inquiry, it la underatood
that, in referring to the eatabllahiaent of clearing house ayat«ns,
you have in mind the poealbllity of the issuance of clearing houae
certificates or acrip in different ooxnmunltlea throughout tha
country,
Thla, of courae, would require the voluntary and whole
hearted cooperation of the bankera in particular areea, and, under
conditiona like theae, the matter la one that preaente a miwber of
cogpllcationa from the atandpolnt of practical operation#
Tha
poealbllity of iaauine auch certif icatea haa been dlacueaed with
aome of the leadera in aeveral important ooraraunitlea where critical
aituatlona have developed, including Detroit, Cleveland, and Balti
more, and information regarding weotoanica and procedure haa been
furniahed to them.
Similar information alao haa been tranamitted
Reproduced from the Unclassified I Declassified Holdings of the National Archives
*
2 -
to the <&aif m m and governors of all Federal reserve banks*
In addition., we are advised that the Finance Department of the
United State* Chamber of Commerce recently sent to the presi-*
dents of clearing house®, the governors of the Federal reserve
banks, and to some individual banker*, considerable material
relating to clearing house certificates and other substitutes
for cash, ’
with the statement, however, that the Chamber i» not
urging the adoption of particular devices to meet current sit
uations *hieh necessarily change fro® day to day*
v-e know that the question of issuing clearing house
certificates has been or is being considered in the coraraunities
named end other®, including the District of Columbia, but, for
a number of reasons, many of which relate directly to their
local situations, they have not. felt, up to this time, that
it would be feasible or desirable for them to resort to such
a device*
In Cleveland, it is our understand! ng that a commit tee
has been appointed by the Clearing House Association for the pur
pose of canvassing all aspects of the matter in the light of the
situation there*
Answering your third inquiry, the Board has requested
me to point out that the question is not whether the situation
should be allowed to drift along under the sporadic state and
community solutions now in progress, but whether any other step
can properly be teken noar *hich would produce better results and
Reproduced from the Unclassified I Declassified Holdings of the National Archives
* 3 -
and i&ich at the same time would not create greater difficulty
or alarm*
All aorta of proposals and possibilities for dealing
with the eeneral situation with ubich we are confronted have been
and are being eanv&ssed and discussed, but so far no additional
measures or authority have developed in concrete form which, at
the -lament, the Board feels it would be justified in urging*
I may add that these matters are dealt with here only
in summary f oim, because it is understood that you are familiar
with the results of the discussions tbet have taken plaoe recently,
including the conference that was held Tuesday evening*
Respectfully youra,
Govern or
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TH E WH ITE H O U S E
WASHINGTON
</
M a r c h 2, 1933.
To the G o v e r n o r a n d D i r e c t o r s of
The F e d e r a l R e s e r v e Board,
W a s h i n g t o n , I). C.
Gentlemen:
I u n d e r s t a n d that the B o a r d is m e e t i n g
th i s e v e n i n g to c o n s i d e r r e c o m m e n d i n g to me t h e use
of the e m e r g e n c y pow er s u n d e r S e c t i o n 5 of the E n e m y
T r a d i n g Ac IT as amended, for the p u r p o s e of l i m i t i n g
the us e of co i n a n d c u r r e n c y to n e c e s s a r y p u r p o s e s .
I s h a l l be g l a d to have the advice of the B o a r d .
I £ it is the v i e w of the B o a r d th a t t hese p o w e r s
s h o u l d he e x e r t e d I w o u l d be g l a d to h av e y o u r
r e c o m m e n d a t i o n a c c o m p a n i e d b y a f o r m of p r o c l a m a t i o n ,
as it w o u l d s e e m to me it s h o u l d be i s s u e d b y m e
before banking hours tomorrow morning.
I als o take t h i s o c c a s i o n to a c k n o w l e d g e the
r e c e i p t of y o u r l e t t e r of F e b r u a r y 28th..(
I am
f a m i l i a r w i t h the i n h e r e n t d a n g e r s i n a n y f o r m of
f e d e r a l g u a r a n t e e of b a n k i n g d ep osi ts , b u t I am
w o n d e r i n g W h e t h e r or not the s i t u a t i o n has r e a c h e d
the t i m e w h e n the B o a r d s h o u l d gi v e f u r t h e r c o n s i d e r a t i o n
to this p o s s i b i l i t y .
I am e n c l o s i n g h e r e w i t h a r o u g h
ou t l i n e of a m e t h o d u p o n w h i c h I s h o u l d like to have the
Board advise m e .
R ep rod uced from the U nclassified
I D eclassified H oldings of th e 'N a tio n a l A rchives
"Sfri.f o r
X*
k w w
All
U * o f hank d « p o « lt »
• shall be aligitele.
a shall
tea eligible upon appraisal tey the federal Reaarre Basks or tey tha 0o»p*
troller or aueh ageneles as ha may designate that tha net assets of
suah bank exeeeds 50$ of tha depositdtfk*. Joining of tha plan to tea
▼oXnmta*T w1^
8*
banks*
for purpoaes of tha pXaa* daposita in tha joining banks ara
to tea divided Into two categories, that is *aottre depoalts* and wln~
aatlra depoaita#*
3.
Tha goreromant to guarantee 100$ of tha "aatlra deposits"*
4*
Tha "active depoaita" to tea
a*
now deposits made in tha teank
b.
00$ of the existing deposits of all depositors except
secured or guarant©ad depositors*
5*
Tha "active deposits" to tea a first aharga of all assata of
tha teank including stookholders Xiatelllties.
"Inaotive deposits"
to tea subordinated entirely to tha "aotiva deposits" and not ba
available to depositors so long as tha guarantaa la outstanding*
tha p r # a n t a g a of eredit to the individual "active da*
poaltor" may tea inoreaaed beyond 50$ If on ©xsaination of tha assets
of the teank such assets prove to tea store than B0$# tent no such Increase
to exaoed more than ?8$ of the value of existing assata#
f*
The banks to pay Into a ocwnon fuad one-half of one pe*e*ftt
of tha average of their "active depoal ts" for the reimbursement of
Saaaea to tha govarnaent.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
a« Ho dividends to be peld by the benke joining in the plan
end no payment® to be made on "Inactive aecaunte* duri ng the period
of the guarantee*
Hew loans made by the banks to be of such character
as isey be determined by general regulations to be Issued by the Comp
troller#
t*
3ueh regulations to exclude speculative nee*
Banks ©ay come out fr m under the guarantee a t any time
with the eon sent of ?6f§ of the deposits on "active account" but in
any erent the guarantee ends in 8 year a•
10*
ternm? from the Bocon&truoiion finance Corporation In eases
of In a b ility of the banka to meet enrrenejr demands in the ordln&ry wigr
Reproduced from the Unclassified I Declassified Holdings of the National Archives
\
ft-, l&SSt
Bocaflt sot la tho aftoraooa# Sool&od Id
xnmSdMl Hotoof**
lotto* ssoat la jro*&oitSagf*
Bo?^r& oat uattl 3 &m* tm1 pm^mSL m
ontvor fosroriae teiotiiat® dootaoatloft of a national ba&i&qr« tMb of
tho o*oai»g inis tspmti la an offori to'-Mag I’^ ttaft-o to o t UMoovelt
txA ProotdUanfc Hw»r«r to®§thsr oa ?ht» propotiiiioa*
Sio Attomsgf toamml, oaf 1st Hr# Hills offioo. w*» tfoo&in «as in
Star So*k nitfc %iro*!i0r H&rrlaoa oaA tho Hanr Yo*te heatosa*
A as? k llo T **tsa Pfooitant Hooror ooao atifc&ag fo r the 9oaxd*s
riKsm^anftMioa m to a national hoHdagr#
Mr/ % a ii a&id tho A l l M f t a i l aaid that t&Ho thoro u**
doubt, th-aro *ao
o f lasr fear tho b a lio f Shat tho Prootdont could
paocl*4n a national hflftldejr tail®* tho !?r«*iia$s witfr the? ri ^ r *o tff as
ttsaamladi that i f 8of*ifsior 2M *or4& tawM aot «it h pratfti, at llotirar,
ho
ddtrio* lila to isouo tho pfooL’twfctoa, hat not ottfcfrwloo*
She BoaxttH effort# to Taring tfotomor limm&mlt ?m& 'trmitlmt
Hoover ta@-§th«r failed. But Board troaM talk tilth M*« floodsI In How
Yoski &at ho v*juld toUi with Qosmraor Hoo-wv ^ l m ttoshtagtoft, *ho
wooM r&ply to Mr* ?$ood*ti* aa& !5oor*taiy i&Ue tsoaM thoa t£&» I I ugs
nith Prooifrait lloovar*
0or:-a?or Koooav&t m$& ho hsiiotod tha trading trlth tho tlnttagf &it
ooo
s%%Xk ia foroot that ho would Uxtox^doo no otgootloit of Fr
Hoovor wooM aot9 t»ifc that *ao no fa r m ho mt£& ip* l>r# Pillar want
up to ooo tibmim*
fcofciooa J$s0Q and itoo,
tho ^»o»o
ototOH^at m * t o
ttio ila^ x&xit iii^iotort^
t»oo»»po l y m ^ t o d oa ;?r^iol^le Mr* %t8sa,5*
og®ggof>tt.oa of » 5 0 cio|)OBit rmi$notlc»s*
%ho Attoraoor doa^asi4 i^i4o a &j?r*£t of n proctoatioa &&&&*$&%a
aatioaal holiday fo r &aio*&ar9 ^ llr^ ^ a tt pr<^a»oft a toaft o f joiat
rooolnttoa
8i<i i:iro»Mmtt8 ^ find #vBag hla po^^r to
odatso^ wlthdmw^ o f oijumider tm hoar^ia^*
ferth g* MBii. t’
rMftyt
Soasd^ la #io £>ft0maoa# ^ lafco tom a dmfl of ro^y to
^r^ol^Hot Hooro^o l«t%or# fe-nd a4vlo«d th& nationed hoil&i^ ^o #to cml^
sa^aao of s»roi4lag hoaMn^ diooatoi^
v^io wMzmrnA fvm tJio ooaoort* /«4 oinao h^icfe to the Bc^^rci1*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
offloo* & Ismg aloouBaioft mmm& m to tho jttoooBlty for Ifrontdent
Hoovor9* issuing & prooltiaiitlan fo r a national toliat$r*
Bo^rd
M t *h&t It should anti smut &* thla.
Hr*' Woadin m * with no*
Hio four a>;iOSjttiira tsoK&oro a g m o d on thl* lottor to f»*ttoldattt
Jfoovar* Mr* t e r o t # 10 *'*» lllf agro^ing ovor the tolophooft#
3h» letter unci aant to SooTotea^ HUii* #50 \m& thoa with
ftmtdant liw a r, t?ith tlid raguoot thafc lie road i t nnd doll*®* I I
I* tho lta»oldmt, at tba nwm ttoo o^iswoing hie pinion to titnift
l>r®0idant I f ho did not ftgwo t?lth lib
Softsvtaqr B ills
that ho did not aypm * giving this
to* l^sidoiii iiaov^r* and ©aid ho **itiid oaem ri# ii ovor and t e s it*
She Bo&sd
to £*ooodo to tlda* m !tr* MlUo this ttooooa&sy fo r a
gt&mn* *s»d 1ju» hlnoa&f bad n*l#ad tho <gn«Btlot» ?tet?*or tfcfr i^joiiitivo
nfldbojRs ^Qm oould iiond meto «t l^ttor*
Bsffcso aondlng tho l^sttor* tho Bo&sd added a roooXuticn roooivod
t m m sho Bl^iotor. of tho ]fo&*r<& Xm» w b Bonk of Won to:*fe said of
- tihtmgo stating that n national, holiday *«** vital*
mm Mr* *Eilla ttnrlvod, ho crltiolsod tho mtwmm In mat lector
to Jtoooid nt Hoover1® oom^^iitawo tfith the Board* fio o«i& It looked
m if m mm %*&%&£ to grai ftroolftant tloorar la a hitf# and to JnotiJy
o«r latter an & *0$# to hia* !f» w4d tho r*sa»<» for not Imving
r©r>iiod aonaor t»aa th&t a rayl# m » tmaooaaBSQf* ?a£ ha told tho Board
taiMBfsdij^ n i# t Hmt tha Attorna^ Oofioxui told ^roBiaetit noovor, ^
-
later la a lottor told l\ii% ttot h&de»^tod tftmtitia* tM Prooldmt hud
po«r®r to w&t -ma ti^ r^ fo ^ tlio Boosd hod not ropH ^i to I^rooid -iit
tosrr^s lottor*
timt ^10 ^ttomsQr
miid that Hr* i^ntt ro^portod to
told hit* fioro tiot 1%ooior
Boatd
t o fo r
mid ilmt I f do^omor llooiioralt ^otjdd join, tm ^otild adinoo i'ror.lciant
fitoo*#or to prodlai» tho i«iti®ttg& h< 4 ^ ^ *
Itr# EU1@ ciovod th»t ^ils raformeo ^ $ao psmimm om '^iyw&mw
vd^t ijroald«iit -’
toovor 1» oedttod t w n tlie lottor* Q*d«iW said >10
would aooopt Mr* Milltt mmn^am%9 m ho did n^»t ?sont ovon to &gpoar
ao t*y5j^ to put fi-esideiit Sciotar in a 2iolo# tmt sjk^>l^f wtfitod to
got tho ^3a«d oat of a liolo Igr aa^molts^ its opinion to Iho l^ros^idmt,
i^ioti^r or not, for any r&Mson, ^ mi#it m m to follow It* Hr* iiiUi
at first aald ho womld f H o with ^ 0 Bocyed & tjtatoaodt of Iher abam
f.iota mmtiozmk ^ h l % Vat that tli^r ai^tit ho ot&tod an a poetofflrtlpt
to th® Boasd^e lottor*
C#S*E*f a mtlon m smmtl&l tm ^hm |>ooood tsnRnfc*miBlsf, t®& tho
lettor mm ®mi to IPr^oidottt H w or, uho# tho nest da^t aekxxnrM^id
Reproduced from the Unclassified I Declassified Holdings of the National Archives
that ha rftooivai it at 1*30
L&t©r tliis
B r m i & m t Hoover - r n M M
ttetmrmw
Hagrw # 10 told him of ttm
fooling of tho Boasd $h&t hi should
daoXait* a XO0 &
for Skiturd^f to t # o M teikiag
r m - U i m % ffoove? is m i f a s M y vosy i**8e?9 hufc flovosKsoff i&por to$gP&
hfcs us a $emww& frti&mi m. m il m tux o fficia l of t&o &K.%»d to Iftou*
t o pvo<tot»l4an*
tioviirjior Ifegr** m m o o a r t e m tat w r / posltivo*
f i l i n g in lt& g r & v t to e a a t m a ^rmsltso fro® the *4Wtei&e*sfc to
i<>,«u* tho pmOUKtttioa, tho I t e M fhao 'too': %) sho ^.uostion of a lo^al
hoMi&jr to bo pxoolatettdi tjgr
Odmmonr of Illinois ansi HowXoj&c,
finally thqr both hud agrood to ci&oXaro tills h o l l a r «hon '«©
acJJoumod u t 3148 turn*
1
forgot *,a add that on thl« tioy# llar.ii 3s&# tho Board woponAid
tho de^oait, r o o o n m roqfUlreraixitJ} f or the
H o a o m & & & of How
toils for 30 dc^ft*
ifcuch 4. Sotoatflif*
Si®
riot lit fiOO &*)&# atsl dociaad that it oould tf&o cotton
#v«n la « holi ioy, to fo m
to dlsomisl V5> attXlooo fo r Itm
Tolie* a# tho Sim Tosfc w*tio two ctom to 22$, s*i& tint Boia*4 ograod to
do this b ;foi"0 tho stata bank hoQUUtagni eaqaUod*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
’ 'EC'D
RECORBPECTION
MAY151958 ( U
OJA
Section 61 of Chapter 369 of the Laws of 1914, entitled nln Act
in relation to baiikiiig corporations and individuals, partnerships,
./
unincorporated associations and corporations -under the supervision of
y
L - f Y
the i n k i n g Department, constituting Chapter 2 of the Consolidated laws,
as amended by Chapter 399 of the laws of 1932, is hereby amended to
/ '
read as follows:
SI:
Superintendents may permit resnnp¥ion of business.
(1)
Curded
The superintendent may, in M s discretion and upon such,
conditions as may be approved by. him, surrender possession for the pur
pose of permitting such corporation or banker to resume business; but
thC superintendent shall not authorize, any reduction of capital stock or
capital as one of the terms of such restaaption.
(2)
In the case of a bank or trust company, the superintendent
ffi&y, in his discretion, if /he deems it in the interest of the depositors
and others interested in its affairs, surrender possession and permit it
to be reopened and to resume its relationships and the conduct of its
business upon such terms and conditions as may be agreed upon between
him and its board of directors, subject to the following;
(a)
Without the superintendent *s written permission
previously obtained* «uch bank or trust company may not pay to any
depositor at the time it so reopens more than such depositor>s proportion
of 80 per centrum of the value, as determined by the superintendent, of such
of its assets as he may determine to be sound and may list for the purpose
of permitting it to make such payments,
(b)
flhe proportion of the accounts representing deposits
subject to withdrawal upon such reopening and accounts representing deposits
A A
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Ir*18
“
-3-*
made, after such reopening shall he entitled to payment in full, together
with, interest thereon, if any, pripr to any payment of or on a c c o s t of
%}& remaining proportion of deposits at the time of such r e o p e n i n g
except that payments of or on account of such remaining proportion of
daf^sits, with interest thereon as hereinafter provided, may "be made at
any time, with the approval of the superintendent, as follows;?
Whenever
the superintendent shall determine that the excess of sound assets of such
ban& or trust company over the deposits then subject to m t h d r a w a l , includ
ing both deposi ts subject to withdrawal at the time of such reopening and
deposits made subsequent^ thereto,, shall be greater than theexcess of
around assets as determined by him and listed as aforesaid over deposits
subject to withdrawal at the time of such reopening, the amfeoat of the
increase may be paid pro-rata to th© owners of the accounts representing
such remaining proportion of deposits, first on account of principal
thereof and after the payment of such principal in full then on account
of the interest thereon;
(c)
t# its depositors--
Such ■
bank or friart.e m s m w .sfcall immediately issua
■
trans#<#pabl# certificates, in form, satis
factory to the st^erintendent* representing, the proportion of their accounts
not subject to withdrawal at the time of such reopening, and susslv certificates
shall bear interest at the rate of not more than three per Gentian per annum;
Ho dividends shall .fee' paid on the s'tocl: of suck
bank or trust company while any of such certificates are outstanding unless,
with the previous written consent of the superintendent to the payment
thereof as aforesaid, it- shall set asideaa^mai»ta.in a
tl«* payasen^ of all such outstanding certificates, skall
sufficient
Reproduced from the Unclassified I Declassified Holdings of the National Archives
L-18
~3-
once a week for two calendar weeks in a newspaper in the county
in which
it has its principal place of "business a notice to the effect that it will
pay all such certificates upon due presentation for payment, and shall pay
all such certificates which may be so presented;
(e)
Within sixty days after a bank or trust company has
resumed business as provided in this subdivision of this section, there
shall be called in accordance with its by-laws or as the superintendent
may direct a meeting of its stockholders and holders of such certificates,
who shall elect directors who shall succeed the former directors.
The
board of directors so elected shall elect officers who shall succeed the
former officers.
election.
Former directors and officers shall be eligible at such
Each registered holder of such certificates shall be entitled
to vote as though the unpaid principal amount of such certificates represent
ed stock of the same par value;
(f) When any bank or trust company resumes business as
provided in this sub-division of this section, the authorized capital
stock thereof shall be deemed from time to time to exceed its outstanding
stock by an amount equal to the book value of the then outstanding certifi
cates issued to depositors as provided in such sub-division, as such value
is shown by the last preceeding official examination of the superintendent,
and such additional authorized capital stock shall be available for
issuance to the holders of such certificates as follows:
The holders of
such certificates shall have the option, at any time, upon the surrender
thereof, duly endorsed, to such bank or trust company, to receive
therefor stock of su<$t bank or trust company at the book value thereof
Reproduced from the Unclassified I Declassified Holdings of the National Archives
jj— 18
"i-■
.
as siiow?i "by the last preceeding official examination of the superintendent,
hut for fractions of shares such "bank or trust company may issue non-voting,
non-dividend hearing scrip certificates exchangeable, when combined with
other similar scrip certificates, for stock certificates or other similar
scrip certificates, on such terms and conditions as the superintendent m y
approve.
The superintendent shall make and file in his office a
certificate, in such form as he may determine, of every such change of
authorized capital stock of such bank or trust company and he shall file
a certified copy or duplicate original thereof, in the office of the
clerk of the county wherein the bank or trust company is located,
(g)
If and when such certificates are paid in full,
principal and interest, or are exchanged for stock, or if and when the .
superintendent may determine that the condition of such bank or trust company
is such that it may safely continue its business in the ordinary course,
he nay, in his discretion and upon such conditions as may be approved by him,
permit it to continue business as though he had never taken possession thereof
(h)
nothing in this sub-division of this section shall be
deemed to interfere with the power of the superintendent to retake possession
of the business and property of such bank or trust company and liquidate
the saue as elsewhere provided for in this chapter, but the rights of
depositors as to priority in payment herein as above provided for in
this sub-division of this seption shall not be affected thereby,
2.
This Act shall take effect immediately.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
JO i m RESOLUTION
Approving the executive order issued "by the President on
March ___ , 1933, declaring a hank holiday, and authorizing
him to issue similar executive ordem.
RESOLVED BY TH& S M I T E A3© HOUSE OF REPRESENTATIVES OE THE
I
Oarded
U1TITEL STATES OE AMERICA IN CONGRESS ASSEMBLED, That the executive
order issued by tha Resident of the United States on March ___ , 1933,
declaring a bank holiday from March __, 1933, to March __ , 1933, inclusive,
pursuant to the authority conferred upon him by Section 5(h) of the
Act of October 6, 1917, as amended, is hereby approved and confirmed;
and, whenever he may deem it necessary in the public interest in
order to protect or preserve the banking or currency system of the
United States, or tt> prevent speculative dealins in foreign exchange
or the exportation, hoarding, melting or earmarking of gold or silver
coin or bullion or currency, the President of the United States is
hereby authorized and empowered to extend the effective period
of such executive order, to amend such executive order, and/or
to issue similar executive orders from time to time.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
q. "7
Fsusyj. is;
mvz. o? m i
aafgPMCeft to ttold and Hoarding GltuaUon.
Monthly Sevlgir^ .iSm,. 1.. 19331
The early December demands on the banks srere met i>artly out of the
proceeds of jold Imports, but the subsequent requirements ’
.7ere met largely
by increased use of reserve bank credit* The monetary gold stock of the
United States increased about 40 million dollars during December, :nd on
December 30th was only 135 millions leas than at the end of 1930, notwitivstanding the extraordinary outflow of gold durin the early auttsan.
There were some further shipments to Surope in December ...... and
a moderate! increase in the amount of old eamaifced for foreign account,
but these transactions vere more than offset by continued gold imports,
chiefly from the Jar $ast«
I'a^e l)
The monetary gold of the United States continued to increase during
the first three weeks of December, and showed only a moderate net reduction
in the final week, ith the result '.hat a total increase of about 40 million
dollars was reported for the month*
Tho increase in the gold hold in, :s of this country that occurred in
the first nine months of the year, has been resumed, following the large
outflow of late September and October, so that the net loss of -old for
the year 1931 has been reduced to about 135 millions •
During the weak ended Janu.ry 6th, the How York money market gained
throuf^i a substantial inflow of funds from other centers, and moderate
payments fro© foreigpa balances held at the reserve bank, transactions
-;:.iich were only partly offset by a net Ithdrarral of Treasury funds from
this market.
In vie./ of this considerable net -’
a in of funds in camercial and
agency transactions, and of the very large surplus of reserves with vrhich
tse l<en' York city banks be yin the week, it was possible for the banks to
retire 239 millions of borrowings, and for Other forms Of Federal re rve
credit to contract substantially and still leave the reserve balances of
the Sew York city banks slightly above requirements.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Bualaena and financial Stiaaary. Jap. 26. X9"'~t
During the week ended Jamuary 20 th, further gain* to the market occurred
t h r o u # aii inflow of funds from other centers, currency deposit# at the
Beserve Bank* and other miscellaneous coiapercial m£ agency transact ions*
Partly offsetting these .gains were lose## throu^i gold. transactions an ...
increase in foreign balances held here, net treasury transactions., and &
d- cline in the Reserve Sy3teraf# hill holdings#
In the succeeding four days ended the 25th, the losses throuji net
gold transactions ,jui increase in foreign balances held here, net Treasury
transactions, a'.decline in federal reserve M i l holdings and other miscellaneous
charges to the market* wo,'e materially larger than the continued .t*in to the
market through the inter-district movement of eojamercial funds*
Monthly aavlaw. ?e.bn»ry 1 .. 19328
Money maxket conditions during the past month have become seem what
easier, and the general level of money rates has declined moterately.
Tkm January decline of money rates m y he attributed partly to the
continued reduction In member hank credit, and partly to the retirement of
currency from circulation., which, however, «&* less rapid than usual for the
time of year*
The large increase in federal r ee r v e credit In the autumn was in
response to another emergency of the kind which the Reserve System was desired
to meet, tho third major occasion of the sort within three years.
Within three monthst the demand for additional currency amounted to
700 millions, ;-,nd there was a reduction in the same period of 700 millions
in the monetary gold stock of the IMited States through eamarkings and
exports* 2hese demands were met hy a rapid expansion of J e d e m l reserve
credit amounting to about 1 billion 300 millions* Subsequently, a further
net increase in t£» aaount of curr ncy outstanding has "been somewhat exceeded
by a renewed inflow of gold, so that the principal influence on the demand
for federal reserve credit 1ms "been the accelerated decline in member bank
reserves resulting from the extraordinarily rapid decline in loans and
investments#
Despite the large increase in the aaount of currency outstanding
during the past year, the toaount of currency in active use i* probably no
larger than a year ago, if as large* In a number of ccsa.iunitie# where
banking facilities have been reduced by failures, currency must now be used
where checks would normally be employed in personal and business transactions.
A considerably larger amount probably represents inactive holdings by Individuals.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Xhirlnthe past year, these reserve t^laroes 1mivo declined toy
raere than 30$* reflectin^ a oorros^cmdine:
in hank deposits*
partly as a result of the tflthdr&ttsl of t m l n toy doaestlc and foreign
depository ,but dot® largely m the re?mlt of contraction in bonk loans
and Inresfcacnts. A large part of the reduction in the rosorve balances
and in d.posits M s oocmrred within t o past four Heaths*
During tlie firs t half of January, i;oX& -ports and iix^rts and
changes in eaiHaar'iaed i^old hold for foreign central 'tmUm largely
balanced, and the cxmetasy gold stock of the tMted States showed
virtually no not
from the and of BecaEtbor*
In the second half of the month there trore fairly suhst-Htlel
txxports# principally of t^old* ^leti h;:,i toeoa previously oar-ti rbsdt hut
at the s m e tlu© there wore tsd<loaal rjxnnt* of $ol& placed uoder easw
irnxk for foreiga c o n t r a ‘
tail®* 2he not result tobui a decline of shout
45 Million** in the QQ m t r j * & gold. stools: during this period*
-Sualnoa .and Mnanalal frjaaMai 3»hraaaf .S. IX i
During the m$k. ended tfaoiuaxy 27# further gplm to tho msfeet
through aa inflow of funda f«*a other part» of the country and deposit®
of curraaey hof© largely offset losses thaou^t additional "Old oovcoe&ts*
ftreaauxy operations* and a further Moline In 7ederesl reserve h ill
holdings*
In the succeeding four day* which inelttiod Hie month-end currency
withdrawals, continued net .e-old exports, and a further contraction In
fclm deserve Systea9* bill portfolio trere only partly off sat toy a
reduction In foreign h ^ m c o s held here* and a auall Inflow of funds
froca other cantors* so that actual reserves had declined to a level
uodefe&teiy in deficit toy the close of business last ai$it*
balances for ti*o three oaapleted clays of the porlod* how-ver, raaalned
la a favorable position*
SiMlaaaa..aail.^aaaftateI .fiijjammv JMttimay .9.. 1333t
During the *»s3c ended fehruasy Ssdt 12*© intosvdistrlct wtvmmt of
funds ms assay fro©. Hew Toifc for tha first tim since the ?/eek ended
Deo^aher 33th* In addition, currency ??a» withdrawn fret* the reserve haute
at the iaonth end* She net result of gd&d oxports and c lK ip in earn^xked
holding ms a reduction In t!10 laonetaiy ^old stodc* Isut this tsas offset
Reproduced from the Unclassified I Declassified Holdings of the National Archives
la the a^grsg^te by a decline in foreign fcakvnees held at the Eesorve
Bask# notwithstanding a aMtcaA d- d im in reserve requireusnts, the
Hew Xoxk city hanks su’bftequently found it mom
to Increase their
indebtedness at the 3U*r.ert» Baric ^ra-Voufc10 nillions, in. order to ualntaln
their reserve position*
$M fm & aa, jatKtfiiaya.,.avH-ftqu.
i>mrlng the i^eek aided February 10th, the reserve lialaaces of the
Sew loifc city 'tem&i declined 1)y about the same amount as did their reserve
re<|ulrsaasite# so that at the end of the week she re ©rvs position continued
to shew a m>mll easoess* Foods uoved to W&wJoxk frora other centers during
this period, trot ^reasuxy transaction* resitted In a net trith&mwal of
funds*
She reduction in the ^old stock throu#i operations in !Tevt lotik Ssad
lit t le effect on the saaifast as the anouat wm o^x >ro&i,:satoly offtoct t>y a
decline in foreign balances at tha Emierve Banks* Sotal reserve hank
credit outstanding in this musket m e redneck mderately 1>y repayment of
mmab^t bank Tjorrcr.Tta/’
p in oxoeas of sales of 'bills to the fteserm Ban!!*,
'Oaring the
ended Sfchxmry 17th# a rather large net loss of
$*14* a t i t a M d srlth&tiwal. of funds f t m the lamftcet hy tlie ^raasury* and
a decline in federal reaervo M U holdings were not entirety offset lay
a large inflow of funds t v m other parts of the count xy« ®. ralnor Increase
in Sew loxk city hank borrowings, and a further decline in resersr©
requirements* Conso^uontly a lao&er&te deficit in rttservooi dow&oped %
the- close of tlae weet:*
Gold and -Sreasusy tf^ansaetlons continual to tala funds free the
maatet during t&e succeeding three tmsiness dssys ending fefcruaxy ';0fchf
&nd ws:i'"--«**end and holiday currency tfi$h&rav*als also restiltsd in a lose*
Partial offsets occurred thru, a farther Inflow of funds from other centers
and other miscellaneous credits in addition to t&lofr the city beats#
tjomsr^QSL IS ailllions* At the Opening; of business tod^r# ((Tuesday) reserves
f tho Sfow Toife city tjnito m r e sa&ftftkat above rec£ilmaentef ? M o h hod
shorn a further decrease during tills period*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
3.
Bmilnema m ii
S h m x m b * Ifcjoii 1.
She decrease in bank rmr: rvee was the result of losses throuffi
treasury operations, $>ld mmm&m&n* and a •reduction In outstanding
federal roser?® credit* viiich mm only partly offset % an inflow of
fund* to this mi&et frm other centers ana
to the narSast f«*a
foreign bank deposit* hold at the Jtoserf* Bank*
In the four days ended yebruazy 29* there wo* a lar$s inflow of foads
|*ere from other district® and further #aina through foreign account
disbarseriente «&iGh considerably exceeded the weekend md &onth»«Ad
withdrawal* of currency. A* th000 g&ins were accompanied by a reduction
In federal reserve b ill holdings and in Ixaafc borrowing# and by & rise in
tli© reoerv* reguiverjent* of the city benlaa, tho actual reserves of tliS
low To*§£ baita, tJioui^i lar£3pr than an the preceding Wednesday, wore s t ill
saoeshat in deficit this cioroin*> Average reaanree, hoover* showed a
moderate exce&s*
" i a a a t o JMadtfHhi rflass^JU, jtf&<
In several io£>ortant reapects banking condliions showed substantial
i£^rovaaent during Jebroaiy* Ba*dc closin&t v-ere reduced to about on**-third
of the nuaber in each of the two previouB month*« and tho- w m m s a n a l
carimoy withdrawals from banos in those uontlis were followed by a aodex&te
return flow of currency to the banlss f tor the first week of February,
indicating a #*ss&tlon of the hoarding of currency*
2h* position of the dollar in relation to other currencies in the
foreign exchange aorteet xim improved to a poi A v?here there was no longer a
profit in escortin^ 11QI& freei the Ifcited States, and exports due to that
cause ceased*
4 month £*#» a u m b e r of the Ikiropean currencies wore at prices- In
the foreign exdhange marfeet which cjade it profitable to ship gold from
Sew Toxic to Europe* and substantial novoaents of .gold were talcing place
for this cause in addition to ^old exports u n d e r t a x as t, matter of policy
by European central bask* representing withdrawal* f r m this riax&t of
their balances* 3bis condition of the ^chaav*:** aj-jarently reflected so..e
concern in European coon tries a® to the possibility of inflation in the
Hilted States. IS*® oarly discussion* of* tho CttajwMStea^ill measure
appeared -to accentuate this concern sooMh&t, but as the provisions of
this bill iind th© general situation hexebeeme better understood this
concern passed* and, as a consequence of this end other influences tending
to weaisen the exchanges of a noaber of countries, the g x m l w m on European
currencies were steadily reduood until by the end of tho uonth the prices
of a ll were below tho point at sfcidh <gold shipments ffroia the Uhitod States
were profitable# awl yplxi xaovoEients frosa that cause ceased, thou$i :3uropean
Reproduced from the Unclassified I Declassified Holdings of the National Archives
6 .
contial fcanJaa coatiauod to v & V h & v m som
of
of their b o l u m m Itors la the t o m
Slaouaaos ths $Xass«3taa{g&ll Act Jfcfbruaxy
1332 •
iuotos tha I'rosidenti
**3y frosing the vast amounts of old la our 2fadez«&
He aerr© System (ia ecccossa of the aold reserve required
tsgr law), 11 ad increases the already i . : ^ av&U&'blA
resources of ths fedexa! -es^rvo taaito to aaa^ls them
■beyond question to laeet any conceivable :icoanda tlmt
ui^it "bo mad© on thaa at hous or frow abroad**.•. *H
Disease©# Section 3 of the a i a s s ^ t c ^ a l l Act p o m i t lag subs tt tut ioa
of "bonds for f$&d 'behind Pod oral rosorv© notes*
States tliat the free f$S4 now is about 420 nillloas, bat that under
the tenas of th© atasndsaen* it could* if neceseaxy* t>e increased to about
X Million 300 iiillions*
la practice this irov&d finable the Syataa to laoet any largo gold
assort or heavy currency disband »or© easily* for ia the face of such a
demand Oovemaent securities coaid bo purchased and thas th© nooesslty for
a Xargp increase ia mmsb or brink discounts coaid be avoided. Slhis is a
®&tt*jr of tqport&aos atno© the necessity for 'borrowiag- largely at tbs
Recurve tanks alitttys escorts upon the tmSbot tanks pressure for liquidation
results ia ti||it taonagr conditions*
Reproduced from the Unclassified / Declassified Holdings of the National Archives
^ 7 o*
T H E W H I T E HOUSE
W A S H iNGTON
F e b r u a r y 28, 1933
To the G o v e r n o r a n d M e m b e r s
of the F e d e r a l R e s e r v e Board*
Gentlemen:
i
Si n c e vm y l e t t e r of a f e w dav s
the banking
s i t u a t i o n h a s o b v i o u s l y b e c o m e one of e v e n g r e a t e r g r a v i t y ,
I n a t u r a l l y w i s h to b e p r o p e r l y a d v i s e d as to s u c h m e a s u r e s
as c a n b e t a k e n to p r e v e n t the h a r d s h i p s to m i l l i o n s of
p e o p l e w h i c h are nqw g o i n g on.
A l t h o u g h the B o a r d is
n o t the t e c h n i c a l a d v i s o r of the P r e s i d e n t , y e t it a p p e a r s
to m e that i n the l ar ge s e n s e it s h o u l d b e p r e p a r e d to
a d v i s e m e as to m e a s u r e s n e c e s s a r y f o r t h e p r o t e c t i o n of
the b a n k i n g a n d c u r r e n c y s y s t e m in t i m e s of e m e r g e n c y .
I w o u l d , t h e r e f o r e , b e g l a d to k n o w w h e t h e r the B o a r d
c o n s i d e r s it d e s i r a b l e :
(a) To e s t a b l i s h some f o r m of F e d e r a l g u a r a n t e e
of b a n k i n g d e p o s i t s ; or
(b) To e s t a b l i s h c l e a r i n g h o u s e s y s t e m s i n the
a f f e c t e d a re a s ; or
(c) To a l l o w the s i t u a t i o n to drift a l o n g u n d e r
the s p o r a d i c st ate a n d c o m m u n i t y s o l u t i o n s n o w in p r o g r e s s *
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Fobruary S8#
Tho Prosldent
Tho Tfhito House*
Doar Mr* President*
tho Board has roquosted no to aoknotflodgo tho receipt of
your letter of February Zt9 1933 fuldressod to the Governor and Moe**
....- - -- miimiiaiiwin i
— ........ nwwriiiinn'mT T
bors of tho FOder** Keatn* Board*
The- Board has boon keoping %xi olooe touch with tho impor
tant charges that are taking plaoo in the situation and ihm matter©
to jwhloh you iofor hare rooelvod* and are roooivins, it* constant
lio doflnit# information is available a « to tho amount
attention.
of oapital that hat boos export© # but* so far as tho Board 1$ ad*
vised. It appear* to bo a relatively naall Itaro so fur*
As you say,
however, withdrawal# of ourrenoy have reached largo proportions, and
gold withdrawals havo increased to aoiae extent.
rlhilo soao of tho reoent dsvalopments aro dlsturbir^, and
laany proposals as to ways and moan® of dealing wi1& them aro 'being
mad©, the Board fools it is ©asontial In times like theso that evory
suggestion be oarofully weighed and considered from the point of
Reproduced from the Unclassified I Declassified Holdings of the National Archives
rievr of whether, if adopted, it would accomplish the results sought,
or ’
whether it would be likely to bring 0 9 m greater disturbance
and make wors* the situation that it I a designed to correct*
Bocontly the Board# after giving the matter oarefwl thought
with theae considerations in mind, approved tha joint resolution fygmy
powers of tho Comptroller of tho Currency introduced tay
Senator Cou*enst utiioh haa passed tho Senate and which has boon favor
ably reported by the Committee on Baakiijg and Currency of the House.
It felt that auoh a measure would bo helpful In facilitating the
working oat of existing situationa in various ooaaanunitiea without
creating undue disturbarwe*
The Board also, from time to time, haa
expressed it# views regarding other legislative proposal• which would
affect the exerols# of its functions or the operations of the Federal
reserve systan* and ia continually studying the various problesaa that
are presented aa the picture changes* with the view of developing oox*»
Crete suggestions Ibr appropriate action if and when the need should
arise*
At the moiaont the Board doe a not desire to make aj$r specific
proposals for additional measures or authority* but it will continue
to give all aspects of the situation its most careful consideration. .
Respectfully yours.
Governor*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F ederal Reserve B oard
O f f ic e o f t h e G o v e r n o r
February 25, 1933*
I showed to Seoretaiy Mills
the letter of the Board, dated
today, to the President, in response
to his letter of February 22, 1933*
Mr. Mills said he -approved the
19_______ 36875
c. a, ooTutmnit pnraTisa'oFnci: imi
Reproduced from the Unclassified I Declassified Holdings of the National Archives
TH E W H I T E HOUSE
W AS H INGTON
F e b r u a r y 22, 1 9 3 3
Gentlemen:
I w i s h to l e a v e no s t on e u n t u r n e d for
c o n s t r u c t i v e a c t i o n d u r i n g the p r e s e n t crisis.
W i t h o u t b e i n g t e c h n i c a l i n r e g a r d to the p r o
v i s i o n s of the law, it is o b v i ou s tha t the
F e d e r a l R e s e r v e B o a r d has a g reat r e s p o n s i b i l i t y
i n the c o n t r o l an d m a n a g e m e n t o f the currency.
I t is o b v i o u s that h o a r d i n g o f currency, and
to some m i n o r e x t e n t of gold, h as n o w r i s e n to
u n p r e c e d e n t e d d i m e n s i o n s , a nd this, t o g e t h e r
w i t h the e v i d e n c e that our o w n p e o p l e are
s h o w i n g of a d i s p o s i t i o n to e x p o r t thei r
c apital, has b e c o m e a t h r e a t to p u b l i c i n t e r
est,
I
s h o u l d like to be a d v i s e d b y the
B o a r d as to w h e t h e r the B o a r d c o n s i d e r s that
the s i t u a t i o n is one that has r e a c h e d a p u b l i c
d a n g e r and w h e t h e r the B o a r d c o n s i d e r s the
F e d e r a l R e s e r v e S y s t e m can p r o t e c t the pu bl i c
interest, or w h e t h e r the B o a r d c o n s i d e r s a n y
m e a s u r e s s h o u l d be u n d e r t a k e n at this j un c t u r e
a n d e s p e c i a l l y what, if any, f u r t h e r a u t h o r i t y
s h o u l d be o btained.
Yours faithfully,
The G o v e r n o r a n d M e m b e r s
of the F e d e r a l R e s e r v e Board,
W a s h i n g t o n , D. C.
/X*-
v v
Reproduced from the Unclassified I Declassified Holdings of the National Archives
r
D r RECORDS SECTION
February 16, 1933
Th# Governor reviewed briefly, on the basis of inforaation received over the telephone fro* the Federal Reserve Banks of
Chicago and Cleveland, the effects in the Fourth and Seventh Federal
Reserve Districts of the b*ek holiday declared by the Governor of
the State of Michigan for all bank* located la that State, and the
consideration which is being given to enabling the banks, particu
larly in Detroit, to M « t the situation at the conclusion of the
period of the holiday. He ale® referred to discussions between
the aenbers of the Board and others during the last three days with
regard to the desirability of securing the enaetaent by Congress of
legislation to M e t any national energeacy which nay develop and
stated that it is believed that it would not be possible to secure
the passage of any important legislation at the present session of
Congress other than perhaps a joint resolution conferring certain
emergency powers.
He then presented a draft of a proposed joint
resolution prepared as a result of the discussions referred to,
which was further discussed and certain changes suggested therein*
At the conclusion of the discussion, the
resolution was uaanistously approved in the fol
lowing for*, with the understanding that it
would be presented personally
Mr* Mills and
Governor Meyer to the President of the United
States an<i, with his approval, to Senator Glass
and posaibiy Senator Vaadenberg and to Speaker
Garners
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-2 ^
•With the approval of th# Secretary of the Treasury
the Comptroller of the Currency shall have and may exer
cise to aueh extent m he deems advisable with respect
to national banking associations any 'powers which the
State officials hairing supervision of State banks, sav
ings bank® and/or trust coapanies in th# State in which
such national banking associations are located may have
with respect to euob State institution* under State laws
now in. force or hereafter enacted*
"gxpeaaes incurred by th® Comptroller of the Cur
rency in the exercise of such powers aaay be assessed
by him against the banks concerned arid, when so assessed
shall be paid by such banks.
•lothlng herein shall be conetrued to lapair any
power otherwise possessed try the Comptroller of the
Currency* the Secretary of the Treasury or the Federal
Reserve Board.
"All powers conferred herein shall terminate on
March 3» 1934.*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
February 23, 1933
The Governor then preeeated a letter rgceived.tMg mcxrn*
ing fro® the President of the United States r©question that he be
advised by the Board as to whether it considers that the exliting
situation is one that haa reached a public danger and whether It
considers the federal Reserve System cam protect the public in
terest* or whether the Board considers any measures should be
undertaken at this juncture and especially what, if any, further
authority should be obtained.
There was discussion regarding the reply which the
Board should make to the President1® letter, but final action
was deferred for a meeting tomorrow or Saturday, at whioh the
Chairman of the Board ©an be present*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
,
February 23 1933
At this point, the Governor received a cmll from the Chairman
of th© Committee on Banking and Currency of the House of Representa
tives to appear before the Committee this afternoon at 2s30 P* »* ia
eonnec&ion with Senate Joint Besolution 256, which vas passed by the
Senate yesterday in the form approved by the Board on February 16, ex
cept that a proviso has been added to the effect that the Comptroller
of the Currency shall not permit the establishment of branches by
national banks except as authorized by existing law.
It was the con
sensus of the members present that it would be desirable for Governor
Meyer to attend the hearing in the interest of the prompt approval of
the resolution by the House of Representatives.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
F e b ru a ry 25#
1933
Reference was then made to the letter received from the President
of the United States under date of February 22:,. 1933* and presented at the
meeting of the Executive Committee of the Board on February 23# and the
following reply thereto m s presented and unanimously approved?
•the Board has requested me to acknowledge the
receipt of your letter of February 22, 1933 addressed to
the Governor and. Members of the Federal HeserveBoard.
•The Board has been keeping in -dose touch with the
important changes that are taking place in the situation
and the matters to vhi-ch you refer have received, and are
receiving, its .constant attention, Wo definite informa
tion is available as to the amount of capital that has
been exported, but, so far as the Board is advised, it
appears to be a relatively small item so far. As you say,
however, withdrawals of currency have reached large pro
portions, and gold withdrawals have increased to some
extent.
•While some of the recent developments are disturbing,
and many proposals as to ways and means of dealing with
them are being made, the Board feels it is essential in
times like these that every suggestion be carefully weighed
and. considered from the point of view of whether, if
adopted, it would accomplish the results sought, or whether
it %Jould be likely to bring even greater disturbance and
make worss the situation that it is designed to correct.
"Recently the Board, after giving the matter careful
thought with these considerations in mind, approved the
joint resolution regarding the powers of the Comptroller
of the Currency introduced by Senator Cousens, which has
passed the Senate and which has been favorably reported
by the Committee on Banking and Currency of the House* It
felt that such a measure would be helpful in facilitating
the working out of existing situations in various
eoanmnities without creating' undue disturbance* The Board
also, fro® time to time, has expressed its views regarding
. other legislative proposals which would affect the exercise
of its functions or the operations of the Federal reserve
system, and is continually studying the various problems
that are presented as the picture changes, with the view
of developing concrete .suggestions for appropriate action
if and when the need should arise.
•At the moment the Board dove not desire to make any
specific proposals for additional measures or authority,
but it will continue to give all aspects of the situation
its xaost careful consideration.*®
from the Unclassified / Declassified Holdings of the National Archives
February 27, 1933
Mr* Mill# referred to the tenseness of the present banking situation
and the very heavy pressure which is being brought on the banks in certain
sections of the country; to the fact that because of advances which have
been authorized recently by the Reconstruction Finance Corporation the
Treasury Department this week will be forced to withdraw from its depositary
banks practically all of its balances, which will result in increasing the
pressure on those banks and particularly on the banks in Mew fork City
where the pressure is already heavy due to the movement of funds to the
interior and abroad; and to the possibility that., as a result of this added
pressure, the banks ja&y be inclined to dispose of considerable amounts of
Government securities which under existing conditions may cause such a
weakness in the Government security market as to create an impression,
'generally, that there is not a satisfactory market for such securities.
He called attention to the fact that the banks in the United States hold
approximately #10, 000 ,000,000 of Government securities, and that it is
expected that it will be necessary to arrange for the sale of Government
short term obligations amounting to more than $1,000,003,000 on March 15,
1933 » ia order to provide for retiring maturing obligations and needed
additional funds.
He stated that the furnishing of funds by the Treasury
to the Reconstruction Finance Corporation is in response to the unsettled
banking situation and expressed the opinion that the Federal Reserve System
should give consideration to the advisability of purchasing during the
current week Government securities in such amounts, up to $100,000,000, as
might be necessary to steady the market.
He added that this suggestion is
influenced entirely by the present critical conditions and not by pending
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-2Treasury offerings and that as Chairiaan of the Federal Reserve Board he
desired to record the opinion that as a matter of sound banking policy
in the face of the preseat crisis the Federal Reserve System should purchase
Government securities as a means of putting additional funds into the market
this week*
He felt that as the present situation is in many way* a psycho
logical one it is important to avoid any further strain on banks, particular
ly at this time, which, in his opinion, may prove to be the turning point
to recovery, if public confidence is not further weakened.
Governor Meyer etated that he feels that the recent thinness in the
•&rket for Government securities is incident to the necessary readjustment
4n a Market which has been too high under the conditions that have pre
vailed; that in view.of the recent increase in money rates abroad, over
which control cannot be exercised in this country, and the increase in money
rates in the Hew fork market and in the M i l rates at the Federal Reserve
Bank of Hew fork, continued purchases of Government securities at the present
time would be inconsistent from a monetary standpoint; and that the Hew fork
market should protect itself against the higher rates abroad by increased,
rates and not through open aarket purchases of governments by the Federal
Reserve Banka.
He expressed the opinion that m y disturbance in the Govern
ment securities Market would come in long term securities which recently have
shown leas resistance than the shorter maturities.; that the treasury Depart
ment should, canvass the possibility of investing available postal savings
funds in the purchase of such long terra securities and. that the only action
which the Federal Reserve System should be expected to consider under exist
ing conditions would be the possible exchange of some of its holdings of
Reproduced from the Unclassified / Declassified Holdings of the National Archives
securities of short maturities, -which continue to be la relatively good
demand, for treasury obligations with maturities of from, aine to eighteen
maths.
He also expressed the view that any reasonable amount of open
market purchases at this time would prove to be ineffective arid appear to
be a vain attempt to prevent a readjustment of rate© which is inevitable*
The thought was also expressed that the suggested purchases sight
be interpreted, particularly in Europe, as a direct attempt of the Federal
Reserve System to support the treasury financing program and if so would
have a very detrimental effect both upon the credit of the Government and
upon the standing of the Federal Reserve System.
A general discussion followed, during which it was indicated that
the other members of the Board were not disposed to favor at this tifee the
action suggested by Mr. Mills.
Ur, Mills stated that he did not wish to
press the matter, bat that he felt strongly that the suggested action is
desirable*
The Assistant Secretary presented a telegram just received from
Deputy Governor Kensel of the federal Reserve Bank of Hew fork, stating
that the bill market opened up this morning bidding 1 \/k% for ninety-day
bills and offering thea at 1 l/S% unindorsed and 1% indorsed! that there
were only moderate offerings of new paper to the market; that dealer*s
portfolios were not large; and that the federal Reserve Bank of Wew York
purchased, largely from member banks, $53*000,000 of bills for System
account at 1%,
Governor Meyer reviewed the discussion at the morning session and
Reproduced from the Unclassified / Declassified Holdings of the National Archives
stated that he had talked over the telephone with Governor Harrison of the
Federal Reserve Bank of Mew York regarding the question of purchasing
additional securities and that, following an expression of opinion by
Governor Harrison that a readjustment of rates in the Mew York market is
inevitable, he had stated to Governor Harrison that he feels that the ad
justment should be allowed to be completed as soon as possible, following
which further consideration can be given to the question of additional
purchases of Government securities to meet any temporary situation, that
might arise or to carry out whatever open market program is indicated to
be desirable.
He also stated that Governor Harrison suggested that the
executive committee of the Open Market Policy Conference be given some
additional authority to meet an emergency situation*
Governor Meyer also reviewed the information regarding the Govern
ment security market given by Governor Harrison over the telephone which
indicated that there is a good demand for short maturities with less
demand for maturities of from 9 to IS months.
Mr. Mills stated that, not withstanding the fact that the Govern
ment securities market closed up from the lows of the day, he is of the
opinion, in view of the fact that the Treasury is faced with the necessity
of calling upon depositary banks to repay #160,000,000 of Government de
posits this week, §76,000,000 of which is for the Reconstruction Finance
Corporation, the Federal Reserve System could render real service by pur
chasing Government securities up to $100,000,000, as it would be unfortunate
to create any additional tension in the situation at the present time*
stated that he could probably avoid to some extent the calling for the
He
Reproduced from the Unclassified I Declassified Holdings of the National Archives
repayment of deposits by creating overdrafts at the Federal reserve banks,
but that, in bis opinion* there are more objections to that action than'
to the purchase by the Federal Reserve System of additional Government
securities.
A general discussion followed, at the conclusion of which it was
agreed by the members present, with the exception of Mr, Mills, that the
Board should take no action at the present time with regard to the pur
chase of additional securities* but that Governor Harrison should be ad
vised by Governor Meyer that the Board stands ready to act promptly in
an emergency and will not object to the exchange of some of the Systems
holdings -of securities of short maturities for securities with Maturities
up to eighteen months, if such action is deemed desirable*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
February 28, 1933
Mr. Miller stated that he- feels that the Board should suggest to
the Federal reserve banks in districts where bank moratoria and restrictions
on payments of deposits are la effect, that they give careful consideration
to the use of clearing house scrip by banks in the affected areas as a means
of 'making the deposits available for use in the respective eommunitleft* the
Secretary stated that a letter to all Federal reserve agents is beiog pre
pared and will be presented to the Board, transmitting copies of memoranda
with regard to the use of clearing house scrip, prepared by Hr. Clarence I,
Bacon, manager of the Hew York clearing house, and by a committee composed
of Mr* H. f. Strater, Cashier of the federal Reserve Bank of Cleveland, Hr.
4. 8. balden, Controller of the Federal Reserve Bank of Richmond and Mr.
John S. Sinclair, of counsel for th© Federal Reserve Bank of Philadelphia,
who were called to Washington by the Board & few days ago.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
March 1, 1933
Governor Meyer then presented the following letter, dated
February M $ 1933, addressed to the 'Board by the President of the United
States*
*Tq the Governor and Members
of the Federal Beserve Board*
"Gentlemens
"Since my letter of a few days ago the banking situa
tion has obviously become one of even greater gravity. I
naturally wish to 'be properly advised as to such measures
as can be taken to prevent the hardships to millions of
people which are now going on. Although the Board is not
the technical advisor of the President, yet it appear® to
me that in the large sense it should be prepared to advise
me as to measures necessary for the protection of the banking
anjd currency system in tiines of emergency. I would, therefore,
be glad to know whether the Board considers it desirablej
"(a) To establish some form of Federal guarantee
of banking deposits| or
"(b) To establish clearing house systems in the
affected areas| or
"(c) To allow the situation to drift along under
the sporadic state and community solutions now in progress.
lours faithfully,
HERBERT HOOVER"
Action upon the letter was deferred no that the Board members might give
it further thought.
Governor Meyer reported that during the course of the last
evening there was assembled in his office a group of representatives
of the Treasury Department, Reconstruction Finance Corporation, office
of the Comptroller of the Currency, and the Federal Reserve Board,
together with Governor Black of the Federal Reserve Bank of Atlanta,
Mr, Bounds of the Federal Reserve Bank of lew York, and Mr. Henry M.
Robinson* who has been a consistent advocate of the use of clearing
Reproduced from the Unclassified I Declassified Holdings of the National Archives
house certificates.
The meeting, the Governor stated, had been
arranged by Secretary Mills, who presented a. ne13.0FS.nciout prepared by
the president regarding the use of clearing house certificates or
scrip for the purpose of making available the deposits in banks where
restrictions had been placed on withdrawals.
There was a prolonged
discussion of the merits of various proposals for coping with the
developments in the banking situation, particular attention being
given to the .matter of clearing house certificates or scrip, but there
was no general agreement upon any particular plan.
It seemed to be
the consensus, however, and Mr. Robinson appeared to share the view,
that It would not be advisable to undertake any national program to
promote the widespread use of clearing house certificates or scrip because
of the many complications and difficulties that such action undoubtedly
w^uld involve.
Governor Meyer said that he- went home about 22il5 a.m.., as the
discussion seemed to have been concluded, hit that some of those who had
participated in the conference remained, and that he learned this morning
that Hr. Await subsequently brought into the room a group of Washington
bankers who had come fro® & meeting of the loeal clearing house associa
tion j that aaong other things, the possibility of the use of clearing
house certificates was discussed with them, and that Mr, Await handed to
thea copies of material which had been published by the United States
Chamber of Cocaaeree relating to the use of clearing house certificates*
Governor Meyer stated, however, that he had been informed that the
Vashlngton bankers apparently did not feel ready at this time to adopt
the use of clearing house certificates.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-
3-
M r . Miller stated that in his opinion it is important that
the Federal Heserve Board should reach & determination as soon as possible
upon a definite policy in dealing with the present situation* and that he
wanted to renew the suggestion m.&® by him on various occasions recently
to the other members of the Board, that the Board propose the adoption,
in communities where restrictions on the withdrawal of deposits are in
force, of plans providing for the use of clearing house certificates and
scrip as a means of releasing such deposits*
He stated that while he
realized that there were unsatisfactory features of such plans, he was.
convinced.that they should be used as far as- possible in the present
situation, and that he was prepared to propose their adoption*
Governor Meyer and Hr* Mills stated that the use of clearing
house certificates and scrip has been urged strongly in the principal
coiasunities where banking difficulties are being experienced at the
present time, and Mr* Mills stated that the adoption of such measure#
has been successfully opposed in those comstmlties by banks which are
in an unsatisfactory position for the reason that they feel that the
plan will reveal their weak position, and by the -Strong banks which do
not think that their condition warrants resort to the use of certificates
or scrip*
Hr. Miller stated that, because of that resistance to the plans
by local bankers, it is not possible to rely on local initiative for their
adoption, and that, in his opinion, the Secretary of the Treasury or the
Federal Reserve Board, although it is not their official duty to do so*
should, because of their responsibility in the present banking situation,
Reproduced from the Unclassified I Declassified Holdings of the National Archives
devise methods for breaking down. that resistance, and. should take affirma
tive action in proposing the adoption of such plans,
Mr* Hills then reviewed some of the difficulties involved in the
resort on a national scale- to the clearing house certificates and scrip
plan, particularly with regard to the payment of taxes to the Government
and the redemption by the Government and municipalities of their securi
ties, which 1ed those present at the meeting last night to the conclusion
that it would not be- possible to reach an agreement upon the advisability
of urging their adoption as a matter of general policy throughout the
country.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
March a, 1933
Governor Meyer stated that Governor Harrison of the Federal Reserve
Bank of lev Xork advised him last night that the board of directors of the
bank, at its meeting this afternoon, undoubtedly will consider the advisa
bility of voting to increase the discount rate of the bank to
After discussion, during -which Mr* Hamlin
stated that he would not be able to be at the
office this afternoon .and that, therefore, a
quorum of the Board would not be available should
action be taken by the Hew York bank, the Governor
v&l authorised, In the event such a rate is voted by
the board of directors of the bank this afternoon,
to advise the bank that the Board approves for the
Federal Eeserve Bask of Hew York a rediscount rate
of 3 X/7$ on all classes of paper of all maturities,
effective March 3> 1933} Mr* Miller voting ^no*.
The following reply to the letter dated February 28 fro® the
President of the United States which was presented at the meeting of the
Board yesterday was then approved, having been submitted previously to the
individual members of the Board for their consideration!
“
The Board has received and carefully considered your
letter of February 28, 1933.
"In response to your first inquiry* the Board has re
quested me to advise you that it Is not at this time prepared
to recommend any form of Federal guarantee of banking deposits*
Tou are, of course, thoroughly familiar with the history of
such experiments in some of the States and the inherent dangers
in a proposal of this kind*
B¥lth respect to your second inquiry, it is understood
that, in referring to the establishment of clearing house
systems, you have in mind the possibility of the issuance of
clearing house certificates or scrip in different communities
throughout the country* This, of course, would require the
voluntary and wholehearted cooperation of the bankers in
particular areas, and, under conditions like these, the matter
is one that presents a number of complications from the stand
point of practical operation. The possibility of Issuing such
certificates has been discussed with some of the leaders in
several Important communities where critical situation# have
developed, including Detroit, Cleveland, and Baltimore, and
information regarding mechanics and procedure has been fur
nished to them* Similar information also has been transmitted
Reproduced from the Unclassified I Declassified Holdings of the National Archives
- 2-
*%o the chairmen and governors of all Federal reserve banks.
In addition, we are advised that the finance Department of the
United States Chamber of Commerce recently sent to the presi
dents of clearing houses,, the governors of the Federal reserve
banks, and to some individual hankers, considerable material
relating to clearing house certificates and other substitutes
for cash, with the statement, however, that the Chamber is not
urging the adoption of particular devices to meet current sit
uation® which necessarily change fro® day to day*
*¥e know that the question of issuing clearing house
certificates has been or Is being considered in the communi
ties named and others, Including the District of Columbia, but,
for a number of reasons, many of which relate directly to their
local situations, they have not felt, up to this time, that
it would be feasible or desirable for them to resort to such a
device. In Cleveland, it is our understanding that a committee
has been appointed by the Clearing House Association for the
purpose of canvassing all aspects of the matter in the light
of the situation there.
’
’
Answering your third, inquiry, the .Board has requested me
to point out that the'question is not whether the situation
should be allowed to drift along under the sporadic state and
community solutions now in progress, but whether any other step
can properly be taken now which would produce better results
and which at the same time would not create greater difficulty
or alarm. All sorts of proposals and possibilities for dealing
with the general situation with which, we are confronted, have
been and are being canvassed and discussed, but so far no
additional measures or authority have developed in concrete
form which, at the moment, the Board feels it would be justified
in urging*
“
I may add that these matters are dealt with here only in
summary form, because it is understood that you are familiar
with the results of the discussions that have taken place
recently, including the conference that was held Tuesday evening**
Governor Meyer then reported briefly, for the information of the
other members of the Board, the matters which were considered at a meeting
held last night in Hew York City at which he, Mr. Mils, the Secretary of
the treasury, Mr. Voodin, the Secretary of the treasury designate, Mr*
George V. Davison, Chairman of the Central Hanover Bank and, trust Company,
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-3Hew York City* and Governor Harrison and Deputy Governors Burgess and Logan
of the Federal Reserve Bank of Mew York, were present, and at vhieh extended
consideration was given to possible methods of meeting the present acute
tanking situation.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
March 2, 1933
Governor Meyer presented to the Board the following let
ter dated larch
from the President of the Halted States, which
had been delivered to his offlee during the dinner hours
*?o the Governor and Directors of
the Federal Reserve Board,
Washington, D. 0.
Gentlemen*
*1 understand that the Board in meeting this
evening to consider recommending to ae the use of the
emergency powers under Section 5 of the Enemy Trading
JUst as amended, for the purpose of limiting the use
of coin and currency to necessary purposes* 1 shall
be glad to have the advice of the Board, If it Is
the view of the Board that these powers should fee ex
erted I mould he glad to have your recommendation
accompanied by a fora of proclamation, as St would
seem to we It should be issued by ae before hanking
hours tomorrow morning *
*1 also take this occasion to acknowledge the
receipt of your letter of February 28th. I aa famil
iar with the inherent dangers in any form of federal
guarantee of bankJag deposit#, but % aa wondering
whether or not the situation has reached the time
when the Board should give further consideration to
this possibility. I aa enclosing herewith- a rough
outline o f ■
a method upon which 1 should like to have
the Board advise me.
lours faithfully,
(Signed) Herbert Hoover**
Action upon the President’
s letter was deferred so that
the member# of the Board might give it further consideration, al
though various aspects of the plan referred to therein, which 1*
attached to the letter in the file* of the Board, were discussed*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Governor Meyer reported that, shortly before the dinner
bourn Secretary Mills had communicated with Attorney General
Mitchell with regard to the authority of the President to declare
a bank holiday under the provisions of the Trading with the Enemy
Act of October 6, 1917, and had arranged for Mr, Harlan, Legal
Assistant to the Undersecretary, and Mr. Hyatt, to discuss the
natter with him,
Ee stated, also, that Hr* Hyatt had reported to
him that, after considerable discussion of the legal and other as
pects of the question, the Attorney General had author!sad Messrs,
HarXa&c.md Wyatt to tell the Secretary of the Treasury that there
is sufficient color of authority under section $ of the Trading
with the Sneay Act to justify the president in taking action under
it if he felt that' the emergency justified itj and that the Attorney
General was then in Hr* Hills* office working on a draft of a procla
mation or executive order, with the assistance ®f Mr. Wyatt, Mr,
Morrill, and Mr, Harlan.
During the sours® of the meeting, all phases of the bank
ing situation were canvassed, and Mr, Mills advised the Board that
the Attorney General had stated that while he thought the President
could act under th® provisions of section $ of the Trading with the
Bnesy Act if he deemed the emergency great enough, the matter was
not free f r m doubt and he did not feel that he should advise the
President to do so without the consent and approval of the incoming
admini.fitratlon,
Reproduced from the Unclassified I Declassified Holdings of the National Archives
It was the unanimous view of the Board that the situation
demanded t&at & banking holiday be declared for Friday, Saturday,
and Monday, and that such action should be taken with the under*
standing that Congress would be called in session on Monday for
the purpose of parsing not later than Tuesday some for® of legis
lation. that would he agreed upon not later than Monday morning#
Mr. Mills, who had been la touch by telephone earlier with the
President and aIr# ioodin., Secretary of the 'Treasury designate, so
advised Hr. tfoodia over the telephone at lit 10 p#m. In the presence
of all those na&td, end of Mr* Baliaatine, Hr. Await, and Mr.
Douglas, who had entered the meeting a short % i m prior thereto.
Subsequently word was received that no action would be taken la
the matter tonight* and thereupon the meeting adjourned*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
March 3, 1933
(afternoon)
Thera followed a considerable discussion of the recent
developoents in the banking situation, especially with reference
to the increasing number of States that have adopted various forma
of bank holiday?* by proclamation or legislative action, the result
ing difficult position in which sound banks were finding themselves
by reason of demands for currency for various purposes including
transfers to communities where banks were closed, and the various
proposals that had been made for dealing with the situation, such
as through the use of clearing house scrip or c@rtjficat.es which
was strongly advocated Xr; Sir. filler, uqt State or Federal legisla
tion, etc.
During the course of the discussion arrangements were
made for Governor Meyer to call upon the President at 4*00 P*M* for
the purpose of discussing with his tho developments which had arisen
during the day jund the possibilities of action of a national charac
ter*
Among other matters, proposals, which had been *i&de to guaran
tee bank deposits were referred to, end Mr. Hiller stated that he
would vote *nott to any such plan*
The discussion resulted in a
consensus that it is desirable to have a nationwide bank holiday
covering such number of days m might be decided upon for the pur
pose of affording an opportunity to develop a plan for preventing
withdrawals of funds from the banks for hoarding and speculative
purposes, including restrictions upon speculative dealings in foreign
Reproduced from the Unclassified I Declassified Holdings of the National Archives
exchange.
The fact that counsel and other members ©f the Board’
s
staff had been working upon the drafting of various forms of ac
tion designed to aoconpllsh this purpose wag referred to and there
was discussion of the outline and scop® of such plans.
Tha Governor left tha mating for tha purpose of discuss
ing tha situation with the Pra aidant and upon hi a return reported
to tha Board that ha fait from tha discussion that tha President
would ba disposed to iasue a aultabla proclamation declaring a bank
holiday if tha Presidant-alaot wara to imlioaia his approval of
suoh ooarae of action* and that thara would ba furthar discussion
of the raattar witii ir, Tioodin and Mr# Boosovelt for the purpose of
ascertaining thair attitude.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
larc 1, 1933
{pining)
It was the -unanimous view of the members of the Conaittee,
concurred in by Hr* James, after diaeuaslons over the telephone*
that the situation demanded a nationwide bank holld^, and, as the
Senate had. adjourned for the day, the Ismiaace of a Presidential
Proclamation or Executive Order seemed to be the only course open*
This view waa also shared fcy Secretary Kills* who was In hie office
arid with whom the Committee was* In 'touch.
Governor Meyer talked over
the telephone with the president, eisphaeiaed the seriousness of the
situation to him, and stated that the Board felt that action waa
necessary tonight.
Following this conv@raa.tion It was decided that
a letter should be addressed to the President urging the issuance
tonight of e Proclamation or Executive Order declaring a nationwide
hank holiday.
Mr. Miller left the Meeting about ten o*clock and went to
the Mayflower Hotel for the purpose of discussing the matter with
the Prenlient-eleet, but did not have an opportunity to talk with
hlM because the fresilent-elect waa engaged upon his Inaugural ad
dress.
However, he left copies of the above documents#for the
President-elect.
Subsequently, Mr* Miller advised the Committee
that he had talked on the telephone with the President-elect and
explained the situation to his* the evening before*
♦(Draft of Executive Order declaring bank holiday, draft of Joint
.Resolution approving Executive Order* draft of Joint Eesolutloa
declaring bank holiday)
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-2Aftar the proposed letter to the President was drafted,
Gove.rQ.oi1 Meyer coaaunicated with Hr# Jam®®, who Indicated hia coapleta agreement with the other aemhers of the Coaaittoa that a let**
ter should be seat to the President reca-mwndlng that a naiionwida
bank holiday be 4@ala.md*
Governor Meyer put in a -mil for Secre
tary Mills, who was than with the President.
The President answered
the call and Governor itayer sgala di scussed the situation with hia
and emphasised. the necessity for a d d o n ,
Mr* 41ju.<*r, who was also
on the wire with the Governor, participated In the diwcniseion.
At
the conclusion of the conversation with the President, Secretary
Kills ttlkec with Governor Meyer* who told hia that a letter to
the President had been prepared urging the declaration by hJa to
night of a nationwide bank holiday, and stated that it was planned
to send the letter to the Secretary at the White House for approval
and delivery to the Fr 9aidant*
Secretary Mills indicated that he
did not see how the Board could act unless all five members were
present and requested that the wnzin* of the letter be withheld
until he could return to the Treasury from the White House, stating
that he would be over Immediately.
Th# Committee then cosaaunioated
with Hr. Jaaes by telephone (shortly after eleven o*clocifc) and re
quested that he Join the meating.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
larch 4, W 3
12105 a. a.
The proposed letter to the President urging that a nation
wide bank holiday be declared, referred to is Governor Uteyera* tele
phone eonveraation with Secretary Mills while the lattsr was at the
White Houge, and to which a postscript referring to the resolution
adopted ty the Uxeeutive Co»a*ittee of tha board of directors of the
Federal Reserre Bank of Chicago, had been added, wa® considered, the
letter reading as follows*
"HefVr-f I*k fc* your letter of larab 2, 1?*'*., and aubsequent conversations, the fedefal Reserve Boar: has been
in session again this evening reviewing the latest reports
o$’developments* The situation as reported from Chicago
has reached the point of extreme tension, with prospects
that by the end of banking hours tomorrow the gold reserves
of the Federal Reserve Bank of Chicago will be dangerously
depleted. Representative bankers are assembled there to
night and have requested that a national holiday be pro
claimed as the only method they know of dealing with the
Immediate exigency with which they are confronted,
Mfhere is enclosed a copy of a resolution adopted by
the board of directors of the.' Federal Reserve Bfwk of Maw
York, now in session* this resolution speaks for itself
as to the £ew fork eltuation.
r*Similar conditions are developing rapidly in other
federal reserve districts*
"The Federal Heserve Board has considered two methods
of dealing with this emergency* one 'ey executive order and
the other ty joint resolution of Congress* The Senate
having adjourned for the day, the issuance of an executive
order seeas to be the only alternative to meet the immedi
ate situation* A form of executive order is enclosed for
your consideration.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-
2-
"The Federal Reserve Board feeli that It cannot too
strongly urge that the situation has reached a point
where imwediate action Is necessary to prevent a banking
collapse.
»P*S« Since th$.« letter was dictated, there has
been ©oiamnnieated to us, by telephone, a resolution
adopted by the Executive Commi ttee of the Federal Reserve
Bank of Chicago, now in ae#aton. A copy of this resolu
tion also Is enclosed**
Mr* Hamlin moved that the proposed letter be sent to the
White House*
After some discussion, Sir* Hills said that he would
like to have the following statement noted in the minutes:
*The Attorney-General hold® that the authority wider
the Trading with the Kneny let is of the thinnest possi
ble kind and at most there is the barest color of author
ity and that he does not believe the President can do it
without the agreement of the President-elect, to be fol
lowed by a validating 4ct by the Congress. I think it
should be further noted that it was my understanding
when 1, left the President tea minutes ago that Governor■
Roosevelt felt that In view of the information he had
from New York that he did not see the occasion for him
to request a national holiday, or, indeed, to assume
Joint responsibility for it. I think therefore that in
view of the opinion given by the Attorney-General that
1 do not see how the President can act on the recommenda
tion of the Board tonight unless the whole question is
to be reopened, I don't differ with the other members
of the Board on the practical situation as it exists now
at aidnight* there is no formal opinion from the Attorney-*
General.*
Mr. Hiller called attention t© the contents of the latter
of March 2 received from the President, in which the President stated
that "If it ia the view of the.- 3oard t o t these powers (referring to
the emergency powers under Section 5 of the trading with the Eneany
Reproduced from the Unclassified I Declassified Holdings of the National Archives
Act as aaended)-should be exerted 1 would be glad to- have your
recommendation accompanied by & form of proclamation, ai it would
swam to »e it. should be ieaued ty me before banking hour* tomorrow
morning*, and said that, while the President was familiar with the
developments that had taken place, the Board had not answered the
ietter ii* writing and he felt that ft should do so.
Mr, Mills
atated that "last night (Thursday) 1 inforaed you that the Attorney
General advised the President not to iiaue such a proclamation and
on the b u t * of that report of mine you decided It was unnecessary
to answer the letter.. We didst*t answer the letter laat night or
this morning. The Attorney General didn't think it advlsable to
issue that proclamation under all the circumataneeB.®
Mr, Wyatt
then said that •earlltr in the evening (Thursday) the Attorney Gen
eral asked me to convey to the Secretary of the Treasury the seasage that he had considered the Trading with the Enemy Act last
evening about 8s30 and that he considered It wai sufficient to
justify the president in acting if he considered the emergency great
enough#11 Mr. Mills replied that “
later that evening the Attorney
General advised ne that in hie opinion he was not justified in act
ing under the Trading with the Ineasy Act and I #o reported to the
Board last night.11 Governor Meyer stated that *»the question of
legal authority is one thing and the question whether you will act
with or without agreement with the President-elect is another thing**
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-
4~
Mr* Miller referred to the contents of the proposed letter to- the
President, and Hr* Hills stated that he had not objected to the
letter but that he wanted to call attention to what had happened
Thursday,
Mr. Hamlin pointed .out that the aerabers of the Board
had been advised that on Thursday evening in Secretary Mills* of
fice the Attorney general had dictated a for® of proclamation for
the President to sign, and that- it was after information was re*
oeived that the President-elect would not assume joint responsi
bility that the Attorney General expressed the opinion that the
President would, not be justified in soting under the trading with
the Ineiay Act.
ir. Mills aoved to strike out the words "referring to
your letter of March 2 and subsequent aasversattons* in the pro
posed letter because he felt that the letter was- not in response
to the President*® letter of Marsh 2.
ir. Haslin stated that he
did not object to the amendment and moved that the letter as amended
be sent to the President immediately*
thereupon, without objection, the change
was agreed to and the proposed letter, as amended,
was unanimously approved,
Reference was then made to the proposed draft of a rati
fying resolution to be adopted fey the Congress which was not ex
pressly referred to in the letter*
Mr. Mills thought it would be
of no use to send the ratifying resolution, and the Board decided
not to transmit it.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
thereupon Governor aSeyer signed the letter,
*nd At 12i30
sent it ly his secretary (Mr.
Fahy) to tne White House*
The letter la its final fora read as follows*
•The Federal Heserve Board has been fa session again
this evening reviewing the latest reports of developments.
The situation a® reported from Chicago has reached the
point of extreme tension, with prospects that by the end
of banking hours tomorrow the gold reserves of the Fed
eral Reserve Ba.nk of Chicago will be dangerously depleted*
Representative bankers are assembled there tonight and
have requested that a national holiday be proclaimed an
the only method they know of dealing with the immediate
exigency* with which they are confronted.
BThere is enclosed a
.ly the Board of Directors
Sew fork, now in session*
itself as to the lew York
copy of a resolution adopted
of the Federal Reserve Bank of
This resolution speaks for
situation.
^Similar conditions are developing rapidly in other
Federal reserve district**
"The Federal Reserve Board has considered two methods
of dealing with this emergency, one by executive order and
the other by joint resolution, of Congress. The Senate
having adjourned for the day, the issuance of an executive
order seems to be the only alternative to meet the immedi
ate situation* A form of executive order is enclosed for
your consideration.
"The federal Reserve Board feels that it cannot too
strongly urge that the situation has reached a point where
Immediate action is necessary to prevent a banking collapse.
WP*S. Since this letter w a s dictated, there has been
communicated to us, by telephone, a resolution adopted by
the Executive Committee of the federal Reserve Bank of
Chicago, now in eessloa* A copy of this ‘
.resolution also
is enclosed.*
The proposed form of executive order enclosed for the con
sideration of the President was as follows*
Reproduced from the Unclassified I Declassified Holdings of the National Archives
*WHEREAS the nation11 bfuiking institutions are being
subjected to heavy withdrawal? of currency for hoarding!
and
there $s increasing speculative activity in
foreign exchanges} and
"WHEREAS these conditions have created a national
emergency in which it Is in the best interest of all bank
depositor® that a period of respite be provided with a
view to preventing further hotxding of coin, bullion or
currency or speculation in foreign'exchange, and permit
ting the application of appropriate measures for dealing
with the emergency in order to protect the interests of
all the people5 and
nWH£KfAS it is provided ia Section 5(b) of the Act
of October 6 , 19X79 as amended, that *The President may
inveetSgate, regulate, or prohibit, under such rules and
regulations as he may preseribe, by means of license* or
otherwise, any transactions in foreign exchange and the
export, hoarding, Belting, or earmarking® of gold or sil
ver coin or bjlli^i or currency * * ’
**$ and
*fB$RBA$ it is provided in Section 16 of the said
Act that ’
Whoever shall wilfully violate any of the pro
visions of this Ael or of any license, rule, or regula
tion issued 'thereunder, and whoever shall wilfully violate,
neglect, or refuse to Comply with any order of the Presi
dent issued In compliance with the provisions of this Act
shall, upon conviction be fined not more than $1 0 ,000 ,
or, if a natural person, imprisoned for not more than ten
years, ar both * * * %}
*8QW, THEREFORE, pursuant to the authority granted
by said Act, I herefcy order, direct and declare that?
•1 . froa Saturday, the fourth day of March, to
Tuesday, the Seventh day of Harea, Nineteen Hundred and
Thirty Three, both dates Inclusive, there shill be main
tained and observed throughout the United States of
America a bank holiday for all of the purposes herein
after set forth;
M2 . During said holiday, no banking institution as
hereinafter defined shall pay out, export, earmark, or
Reproduced from the Unclassified I Declassified Holdings of the National Archives
.7 *
"permit the withdrawal or transfer in any warmer or by
any device whatsoever of any gold or silver coin or
bullion or currency or take any other action which might
facilitate the hoarding thereof; nor shall any such banklag Institution pay out depot? It a, make loans or discounts,
deal in foreign exchange, or transact any other banking
business whatsoever*
*3. Dpon the expiration of esi iolid&y and until
otherwise ordered tgr the President o the United States,
such banking institutions may pay out, export, earoark
or permit the withdrawal or transfer of gold or silver ■
coin or bullion, or currency, or deal in foreign exchange
to such extent aa may be permitted by license or other
wise under regulations issued lay the Secretary of the
Treasury with the approval of the President*
*4*
proval of
prescribe
carry out
the Secretary of the Treasury, with the ap
the President, is authorised and empowered to
such .regulations as he may find necessary to
the purposes of tula order.
M$« The terai 'banking institution1 m herein used
shall include all Federal reserve banks, national bank
ing associations, banka, trust companies, savings banks,
building and loan associations, credit unions, or other
corporations, partneishi* *, associations or persons en
gaged in the business of receiving deposits, making loans,
discounting business paper, or transacting any other
for® of banking business*
The White House
March
, 19.33**
Mr. Stills stated that the Senate would not meet until 10i 30
a.ro* Kerch 4j that the Senate majority leader, Senator Robinson, would
not be there, and that It would be practically useless to attempt to
get legislation Saturday morning*
Governor Meyer's secretary (Mr. F&hy) returned to the of
fice shortly after one a.m. and reported that, when he arrived at
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-athe White House, he wan informed that the President had retired at
12 106 a.si., ?md thut the attendants there hesitated to disturb him*
Finally, however, they telephoned to f#r* HIobey, one of the Presi
dent* i secretaries, who authorised them to deliver the letter to
the President at once*
Sr. §1111s tried to reach Governor Pinchot of Pennsylvania
by telephone at hia Washington residence with the view of dismissing
with him the question of a bank holiday In Pennsylvania, but was
unsuccessful.
In the meantime,. Counsel for the Federal Reserve Bank
of Philadelphia had been in tonch with the attorney General of
Pennsylvania, who, in turn, had taken the matter up with other State
officials and they, too, were endeavoring to reach Governor Pinchot*
Governor Meyer talked over the telephone with Governor White of Ohio
at the flayflower Hotel., and with Governor Herring of Iowa at the
Willard Hotel regarding the banking situation and the possibility
of declaring bank holidays in their respective States if the Gover
nors of lew tork and Illinois decided to act*
At 2t22 a.m. Mr* Mills reported that he had received, infor
mation which indicated that, in all probability, the Governors of
Illinois and flew Xork would declare bank holidays in their respective
States.
At 2t45 a.afu Mr. Stevens of Chicago advised over the long
distance telephone that a proclamation was being drafted which it
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-
9~
was expected that the Governor of I3JUno1« would sign* providing
for a full legal holiday cm Saturday with tha possibility as to
Kondmy, Tuesday and Wednesday, that tha amount of withdrawals would
ba restrict*'! to not exceeding; 10%.
it 3f00 a.m* Hr. Hamlin moved that the Chicago bank be
instructed to close If the Governor declared a holiday.
Mr* Hiller suggested that the Federal. Reserve Beak be
advised that the Board assume* that the bank will close unless it
has assurance that there if* no need for closing ly the clearing
house bsnks of Chicago.
Mr. James thought it mould be better for each hank to
work out its own decision*
Hr. Killer then suggested that each bank be advlsed that,
|f in its judgment St is advisable to close, the Board will interpose
no objection*
*t 3*10 a fm. Governor Barrison advised over ths long d|
taace telephone thet a legal holiday lasting through Monday mill be
declared lay the Governor of !?ew York, and that, in the circumstances,
the Federal Beserv* Bank of $ew fork will, close today.
At 3s20 a.m. Chairman Stevens advised that a legal holiday
will he declared, tgr proclamation, of the Governor of Illinois, at
least for Saturday with the possibility of a restriction as to with
drawals of deposits on Monday and Tuesday, and that in the circum
stances., the Federal Reserve Bank of Chisago will close today.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-40.
Thereupon the Board adjourned, with the understanding
that membera of its staff would communicate the development? In the
situation to the Governors o f all the Federal reserve banks (other
than Chicago and Sew tork), and would point out to the* the advisa
bility of considering what action they should taka in order to
protect their situation in view of the declarations of bank holidays
in fen fork and Illinois m d the coapeqaeni•closing of the Federal
fieserve Banks of *ew York and Chicago.
Reproduced from the Unclassified I Declassified Holdings of the National Archives
March 4, 5, and 6, 1933
On March 4 and also on March $ and 6 the members of the Fed
eral Reserve Board were in their offices and participated la frequent
conferences, including an informal conference arranged by Secretary
Wood in for March 5 at which Treasury officials and others were present,
regarding the developments in the banking situation and various
methods of coping with it, but held no formal Board meetings.
During
the morning of March A the Governor received the following letter from
President Hoover which he brought to the attention of the other Board
members informally*
■Hon. Eugene Meyer
Federal Reserve Board
Washington, &, C.
My dear Governor Meyeri
1 received at half past one this morning your
letter dated March 3rd. X must assume that this letter
was 'written on the basis of information received by
you prior to 11,30 o*clock last night for the reason
that before your letter was sent you had certain informa
tion as follows*
a. At 11 o*clock last night the President-elect
had informed me he did not wish such a proclamation
issued.
- b. The Attorney General had renewed the same
opinion which he had already given to the Board that the
authorities on which you were relying were inadequate
unless supported by the incoming Administration.
o. That groups of representative bankers in both
Chicago and Mew York, embracing members of the Board of
Directors of the federal Reserve banks in those cities, were
then in conference with the governors of the states of
Illinois and Mew fork, and that the governors of these
two states were prepared to act if these representative
groups so recommended. It appears that the governors did
Reproduced from the Unclassified I Declassified Holdings of the National Archives
-
2~
take action under their authorities, declaring a tempo-*
rary holiday in these two critical states, and thus
accomplishing the major purposes which the Board
apparently had in mind.
In view of the above I am at a loss to understand
why such a comaamie&tion should have been sent to- me in
the last few hoars of this Administration, which 1 be
lieve the Board asust now admit was neither justified nor
necessary.
Tours faithfully,
HERBERT HOOfES*
In the evening of March 5 , the President,-after conferring with
Secretary Veodin* the Attorney General, end others, decided to issue a
proclamation declaring a nation-wide bank holiday from March 6 to March
9, inclusive.
@FedFRASER