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4 / 92 0 FLATPTIS C. DAL-VMS leres HARRiS T1TJSP 131C711.13XN0 enl WEST MONA4.0E STREET CHICAGO September 29. 1925. 0 Mr. Benjamin Strong, Federal Reserve Bank, New York City. My dear Mr. Strong: The Commercial Club of Chicago expects to hold a dinner on the 13th of November, and believing that Dr. Schacht may be in the city. at that time they sent him a cable in the name of Mr.. Melvin A. Traylor, its Secretary, inviting him to be the guest of and to make an address to the Commercial Club on that date. At the same time General Dawes wired Dr. Schacht stating, in effect, that the Commercial'Club was an organization of representative business men, and in his judgment a suitable audience through which the business elements of the central west might be reached; and stating that it would be a personal gratification to him if Dr. Schacht could accept this invitation. General Dawes has just received a message as follows: "Many thanks your telegram regarding Commercial Club. Date of my journey still uncertain. Have arranged with Benjamin Strong that my arrangements on your side shall pass through him. Please kindly inform Commercial Club to communicate with Strong and give my best thanks for invitation. I am looking forward with great pleasure to meet you again. Signed Schacht". I am addressing you as President of the Commercial Club, and I earnestly request you to use your good offices to secure as soon as possible the consent of Dr. Schacht to come to -2- Chicago and address us at that time. You will appreciate how much of a favor it would be to us also to make the engagement definitely as early as possible. We are extremely anxious to have this op- portunity of entertaining Dr. Schacht, and I do believe that it would be the best audience he could have in the west. We will ap- preciate more than I can tell you your co-operation in this effort. Yours very truly Oc-A-Ati j- 71. _(_'- RU FUS C. DAWES , L 1 t. I-A . ....., 1'. '''''' f ' ..'. 1 _ : ........- tr. _ r..a. . , . _ ,-,.. ... i L-1 C.) cep > , 0 ::-...,1. (.1- _ ; ,Ii. _J Li) c) 'D-1: 1 .1.1 ' LI c-c:. 1._,- --f r'l , , Ns, fts. a R U FU S C. DAWES 11,..ARRIS TRUST BUILDING CHICAGO 40. September 30, 1925. Mr. Benjamin Strong, New York City. My dear Mr. Strong: I have had an opportunity, since the receipt of the cablegram from Dr. Schacht and the writing of my letter to you Of yesterday, to discuss the matter with some of the members of the Commercial Club. The suggestion has been made that it would be most agreeable if you could come to Chicago with Dr. Schacht, and you, yourself, address the club on the same evening that he does. I think I need not speak about the membership of the Commercial Club, or the relation which it sustains to the city of Chicago and the central West. I believe you know that it will be a very good audience, and a good opportunity for the presentation of ideas. I do wish to say for the club that it would afford us all the greatest pleasure in the world if you could so ad- just yoUr engagements so as to come with Dr. Schacht, and to speak to the Commercial Club on that seine date. Sincerely yours, October 2, 1925. EATACIA0 My dear Mr. Dawes: I have received your letters of September 29 and September 30 and am sorry not to be able to send you more than a tentative reply it this time. Dr. Schacht has advised me that he will be somewhat delayed in carrying out his plan for visiting me this Fall. :ust how long a delay he expects I am not yet advised, so it will be necessary for me to defer a reply to any invitations which have been sent to me of a character similar to that of the Commercial Club of Chicago until I know more definitely about his plans. I think I should advise you, however, that his trip must be a very hurriee one, and the time at his disposal may make it quite impocsible for him to go to Chicago at all. 'Then I last saw him in London, he had determined to make no public addresses whilecin this country, and, in view of that decision, I have advised some of my friends in New York who have sent him similar invitations that he would not find itpossible to accept them. This is all, of course, by way of posting you as to the situation, because after all Dr. Schacht will decide whether he is able to go to Chicago and whether he will feel able to make any exception to the decision of which he advised me when I saw him. The delay in his sailing, however, will enable me to write him fully, and I shall do so at once. With kindest regards, I am Sincerely yours, Mr. Rufus C. Dawes, Harris Trust Building, Chicago, Illinois. 0 nTJJTT C. DAWES 1615 ITA_FCRI TRUST BUILDING ni 17M ST MONI20 SPREET CHICAD 0 October 7, 1925. ACkiMiWi,E1)(1e.D Mr. Benjamin Strong, New York City. OCT 9 1925 (4 My dear Mr. Strong: I appreciate very much your letter of October 2nd about the invitation of the Commercial Club to Dr. Schacht. The elements of uncertainty seem discouraging to a person in my position, who is responsible for a meeting early in November. The time of his visit is uncertain, and he may not be willing to speak at all after be comes. can well understand his ireluctance in this res- pect, and of course I realize he must be left free to make this decision. When I recall how tactfully he expressed himself under very embarrassing circumstances in Paris and in Berlin in 1924, and realize how helpful the right word from him might be at the present time, I cannot help thinking that he may change his determination expressed in London not to make public addresses in this country. In the hope that you may hear from him soon, I shall refrain from making any other engagements, and shall notify you when, in my judgment, it becomes necessary. to withdraw vitation. the in- Benjamin Strong-2- I am sorry that his visit must be so short, for I know of no one who has earned so fully a respite from his work and responsibility. Yours very truly, itS RU FUS C. DAWES ULA 5 1?25 RECEIVED 30VERNOR'S OFFICE A October 9, 1925. My dear VT. Dee: I have just received your letter of October 7, ent it seeme to me I have done all I could do in radard to your desire to have Dr. Schacht at end the Commercial Club Dinner. Be at first advised me that he would be here on the 19th, then that he rould be delayed. 2 or 3 weeks, and the day I wrote you he cabled me that he would be here on the 19th after all. Yhile he had thought of going to Chicago the last time I sew him, iem under the impreesion thst he has now abandoned that plan, but he failed to edviee me. He h.o now &ailed, and I ehall probably have no more particulars as to his plane until he errives here. He has replied to all invitations, hoeever, that his visit is a private one, and that he feels constrained to make no public addresses. I am sorry not to be able to eend a more eatiefactory reply. Very truly yours, i) Rufus C. Dswee, Esq., 1815 Harris Truet Building, Chicego, Ill. 4-614-7 /97/7 )peic dr. a Y; 4/, 7,04 "e-c-41. 4kA;Kit --0;:".4,4e1 r./1;. Hotel Ritz, July 30, 1919. Dear Sir: Your note was handed to Mr. Strong just as he was going out for dinner. He regrets very much that a prior engagement will not permit him to accept your invitation to luncheon tomorrow, but wishes me to express to you hib sincere appreciation of your courtesy. Very truly yours, Secretary. John R. MacArthur, Esq., City. eJOItN R. NIAc ARTIEUlt PlicEsxrcEN, MAC E BE01,11E1IS NIEANY EQUITABLE BUILD NEWYORK --7------ownir lCvY14) ifvu e2A4.4 act 33 /10 GC( , ,r4 (60,7 bo---rAN-0( 1-7 c/ LAA) W'rY,14-4'Y ex,<A__ok 17,t-r) 4 April 3, 1919. Dear Jack; Your note of the 2Tth ultimo just reaches me, and I think I can answer it satisfactorily. We only expect to have one meeting of State Chairmen, unless something very unexpected develops, and that may tot take place until next summer or fall. Our thought was to hold such a meeting at some central point, like Chicago, for the purpose of discussion and exchange of views and to make perfectly be carried out. clear to everyone just what is in mind, and how the program should Seyond that the 2tute Chairmen would have great local autonomy in all matters of organization, and the material relating to propaganda, educational work, etc., would largely be furnished by the organization in New York or Washington. have already telephoned John Pratt. he understands the situation - and urges me most strongly to secure your acceptance, which I hereby do with my own indorsement. 2aithfully yours, Chairman, Southern Jalifornia Wison Jompany, Los Angeles, California. B3/1.16:13 April 11, 1919. Dear Jaolt; was greatly disappointed to receive your telegram about the budget appointment, but thoroughly understand how you feel. ,The suggestion of All Jrocker is a good one. 71e have also had Requa, fuel Administrator, suggested by some one, and I would appreciate an expression of your views in regard to him. You will hear from Pratt in response to the inquiries contained in your telegram. We will miss you, but that can hardly be avoided, suppose. faithfully yours, John B. Miller, 1..f.sq., 3outhern California lidison Company, Los Angeles, California. , i ) vi-i - if 3.z -, ,..A' ' 4)4 Lt l&-T4 t e /4 14 . id" (-4 &A- ooe -C 1_644 "1.' tay,A "e- ,e,k4Cifr ' 44 f? . e.,,a Ca, / 414 in , COPY WILLIAM C. REDFIELD 165 BROADWAY NEW YORK May 25, 1926. Mr. Benjamin Strong, Governor, Federal Reserve Bank of New York, 33 Liberty Street, New. York,'N. Y. My dear Er. Strong: The within I assume to be a circular letter but it occurs to me that it may be helpful to you if a response is sent. I shall, 8 therefore, be glad to receive any suggestion h you may care to have made looking toward a possible reply to Honorable James G. Strang. Yours very truly, (Signed.) William C. Redfield. FEDERAL RESERVE BANK COPY OF NEW YURI( June 8, 1926. My dear Mr. Redfield: In Governor Strong's absence abroad, I want to thank you for your very kind letter of May 25 concerning Congressman Strong's circular letter to you on the subject of price stabilization. As you may perhaps have heard, Governor Strong appeared before the Rouse Banking and Currency Committee, to testify concerning Congressman Strong's original bill. I have delayed replying to your letter hoping that it might be possible to send you some sort of extract of his testimony, but, unfortunately, none is yet available. You may be interested, however, in the summary of his discussion on this subject, which a-ppears in tile June Bulletin issued by the National City Bank, a marked copy of which I am taking the liberty of enclosing. This may give you what information you want, upon which to base a reply to the Congressman's letter, although the proposal contained in that letter is very much more detailed and far-reaching than the original bill which Governor Strong had before him at the time he gave his testimony. Very truly yours, GEORGE L. HARRISON, Deputy Governor. 142.. Wm. C. Redfield, 165 Broadway, New York City. GLH.UM 0 2Y WILLIAM O. REDFIELD 165 BROADWAY NEW YORK Jude 10, 1926. At. George L. Harrison, Deputy ,d-overnor, !ederal Reserve Bank of New York, 33 Liberty Street, New York, N. Y. My dear MI'. Harrison: Thanks for your note of the 8th with its enclosure. I wonder what you will think of the letter sent Congressman Strong today, as per enclosed copy. Yours very truly, (Signed) William C. Redfield. June 10, 1926. Hon. James G. Strong, House of Representatives, Washington, D. C. hy dear Sir: I have been obliged, partly through absence, to delay my response to your favor of May 21st asking my consideration of and frank ,omments on the suggestions made respecting the granting of added powers to the Federal Reserve I System and the consequent devolvement upon them of added responsibilities. have in mind particularly the suggestion i perhaps i may say the purpose, to direct the Federal Reserve Board to use its powers for what may be called the stabilizing of prices. I note the qualification that this stabilizing, though it is declared to be "the primary function", is limited, or rather is supposed to be limited by the phraseology "so far as may be possible consistent with sound economic Pointing out that not only thoughtful men but many men who volprinciples". ubly claim to be thoughtful differ as to what sound economic principles are, I venture to add that the general suggestion seems to me to impose upon the Federal Reserve System a duty which, upon the one hand, it will be quite tm,possible for them, or anybody like them, either adequately or permanently to perform, and one which, being imposed and being impossible of performance, is certain to bring upon them the denunciation of those who assume that imposition I think, therefore, the passage means the power to carry out the duty imposed. of the Act as proposed would place the Federal Reserve System in a very dangerous position, would involve it in hazards that should never be permitted. If it be assumed that the rigid stabilization of the dollar is in every respect permanently desirable, about which there is some possible question, I still think the measure omits from consideration the major forces which act in the premises. No country lives to itself, not even as respects its currency The great economic forces which affect values are world-wide. Their values. power is such that when they are once in action no single nation is able to if it were feasible to avoid yielding in some measure to their influence. unite the productive powers of all mankind to the regulative powers of all nations acting in permanent harmony, then and not till then would it be possible ever' for any one nation to insure its currency from rise and fall in obedience to economic forces too powerful for the greatest country to resist. I am, Sir, Yours very truly, (Signed) Copy sent Yr. Harrison. William C. Redfield. M.1EFRVt BANK' OPY June 11, 1926. 2FRSOnt. Dear 'fr. Redfield: I want to thenk you for your very kind note of June 10 sending me a cer- of your letter to Congreeeman Strong on the subject of his proposal rela- tive to the etabilizetioa of tie price level. Your letter eeeae to me a muet aappy uziacoaiae expoeition of the rieks which are iavolved in the ?rent propoaaI. While ia sympathy with tha aucral purpese which *e believe Congresesan Strone his in mind, nevertheleee 7a cennot but fear, ea you do, th-t through mieundereeaudiag or ignorance, the -eeendoeot in its preeent form might be eonetreed as a legislative mandate to the Federal Recerve System to maintain a stable price level without regard to the feet thet fluctuations in the price level very frequently may result from the eperetion of economic laie or other factors entirely beyond the influence or control of the Federal reserve banks. It may xell be thet Oengrees could formulate some language that would indicate its iatereet in the stability of prices as well as its desire to have the Federel Seeerve management keep price Stability in mind in the exercise of the 9yetem's functions In relation to the volume endeost of credit as distinguished frem the many other factors upon which the 'rice level depends. But T do not believe that the propoesle which have been eubmitted would accomplish this purpoee rithout at the seme time imposing upon the Byte m some measure of public reeponsibility for all the fluctuatione Cast occur, whatever the cause. You have very clearly pictured the hazards which thie might involve. June 11, lien. I want again to thank you for sending me zi copy of your most interestin and helpful letter. Very truly yours, GEORGE L. HARRISON, Deputy Governor. Mr. William C. Redfield, 165 BroLdway, Nes York City. GLH.MM 4+1 fijA AMERICAN TELEPHONE AND TELEGRAPH COMPANY TELEPHONE AND TELEGRAPH BUILDING 195 BROADWAY W. S. GIFFORD NEW YORK VICE PRESIDENT M. C. RORTY November 8, 1922. ASSISTANT VICE PRESIDENT CR1: -' 71/ elm °. riga. Mr. Carl Snyder, Federal Reserve Bank, New York City. tar gi4-t 4.tt-'-f%; 014-/1,11;;I Dear Snyder:- I,have just been rending over your memorandum on foreign debts, and have practically no comments. I assume that, while you say "commandeer exports", you really mean that such exports would have to be purchased out of the proceeds of taxation. . If so, the deficits due to price differences wosuld not have to be separately met. The same thing would be true if the commandeering took the form of taxation in kind. If, on the other hand, your thought is that there will be no actual commandeering or taxation in kind, but simply the establishment by the government of export prices low enough to force the development of foreign trade, it would probably, as you indicate, be necessary to cover the differences between prices by taxation. domestic and export The credits resulting from these exports would, however, be private and not governmental credits, and the government would have to reacquire such credits)presumably by taxation7for reparations our In spite of the above comments, I think that your suggestion is a thoroughly good theoretical answer, from which it is not 2 C) impossible to derive a practical answer to the arguments ordinarily set up to prove Germany's inability to pay. As to the second part of your memorandum, I should be inclined not to bring into the argument the percentage or the national income that represents annual savings. A large part of such savings is necessary for continued industrial activity, and cannot be looked upon as a surplus. The real point, as I see it, is the capacity of a nation to expand its production above normal when working under forced draft. As to this factor, we have much evidence that any industrial nation can readily add 10 or even 15% to its normal production. However, as you indirectly indicate, the final and controlling problem is that of raising taxes. As to this, I believe with you that 5% of the national income is a thoroughly practicable figure. As to the third part of your argument, I should criticize your statement that an impost on Germany of two billion gold marks per annum would seriously affect her industrial growth. As I see it, the sad thing from thestandpoint of France and the Allies generally will be that no such amounts could be collected from Germany without stimulating on her part a very high degree of industrial activity. and of industrial progress. As Bismarck said, after the FrancoPrussian war, "The next time we defeat France, we shall pay the indemnity". Sincerely yours, RITZ CARLTON HOTELS ORGANISATION LONDON-PARIS-NEW YORK GENERAL MANAGER-PIERRE GAVUZZI TELEPHONE 3060 AVENIDA TEL ADDREssPLAZOTEL- September 26th. 1923. Dear Mr. Strong: Before leaving New York for a long country I. had. practically completed_ arrangements, through the National Bureau of Economic Research, of which I am President, for the establishment of a novel institution to be known as "The Economic Founda- trip through this very interesting South American tion". The pleasure of my present trip has been somewhat marred by the feeling that, in absenting myself from the United States, I have neglected a duty to this new organization - and. I am, therefore, trying to discharge a portion of this duty at long range by asking you to look over the papers which will be sent to you in a few days describing the plan and purposes off the Foundation. I an quite certain that you will not regret a few minutes spent in examining a unique and. thoroughly constructive proposal for the upbuilding of a safer, saner and more thoughtfully progressive United States. Yours very truly, Mr. Benjamin Strong, Federal Reserve Bank. Equitable Building, NEW YORX CITY.