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Denver, Colorado,
January 3, 1917.

pa VATE.
Dear /udge:

ve a word with you

I asked Hendricks in a recent letter to

adopted of sending

about the practice which he advised me had be

copies of the weekly reports which

sent to

to the Reserve Board

and have heard nothing about it since writing.

struck me as an

s recent actiO

unusual proceeding and since
to feel that I would rather

am inclined

reports in that form than to
quently, less frank and complete

have them subject to revie
than they might otherwise be.

At no tine

ve I felt the slightest

g the pa

nee from the complete of the Reserve
members confi

desire to withho
Board, even

in

before the

witho

reservation

some *er and I am v
con

The whole subject was laid

s Bank of Engl

.uing to send th

ut it seems that this course involves

o ask your opinion as to the wisdom of
e week/7 statements.

Very sincerely yours,

J. F. Curt
Federal 'Reserve Board,
Now York City.

BS/CC




Denver, Colorado,
January 3, 1917.

Dear Judge:

of mail and have

I am struggling with a great accumulati

at the top of the

reached yours of the 22nd, Which in fact was
pile.

Those Christmas knick-knacks were really bul

none of the

books and dill

in

t

sad

them all

I have

read

th great en-

joyment, particularly the

What can I say to you

ve been heartsick over the whole

recent Washington dev

exchequer bills and now

thing - first t
about the Bank

this announceme

fro

Can it be a fact that

this egotistically, but only as ap-

muse?

kindergarten first bills in affairs of Importance, and I am

plie
not

England.

rs, are the only ones that have

you and I, with
any co

essay to Treman IL, regard to

acessarily refe

he start.

so len
and just

the

hear

ng to peace negotiations Which have been bungled
r, I wish some of these fellows in ,,ashington,

ot be "translated" could oe transported to Europe
the sounds and smell the smells of battle from a distpnee

of a few hundred miles - it would do them good.

After mature deliberation, I have decided to let the Bank of
England episode take its official course and I am writing

nothing on the

subject to the members of the Board at .ashington, at any rate until
they write me.

If I did write them officially, it would be to advise

2.

- Llr. Curtis.

January 3, 1917.

them that I am sending in my resignation,
Which I am selfish enough
not to do, at any rate until
the finishing touches
are put on these
foreign arrangements.
So much for now.

concerning which

had wonderful exooriences in the
mountains,

I will try and write you later

Very since reli,720)1
Curtis, Esq.,

Federal Reserve Banx,
New York: City.

Bs/cc

e







rte -

Denver, Colorado,
January 9, 1917.

Dear Judge:

That mistake about your mansion was not my fault, but was

Laura were going to live sensibly herea

ur good wife

you an

the result of an old understanding I had
r an

uisance

avoid th

Thanks

and care of a house, but I guess you ar too old fashion
*

for the details.

I cannot really

ou much sympa

od health and

ankle; you have been braggin,.

the misfortunes of your assb,iates and this

the way the Lord visits
ly about it had I not

I woul

his anger upon you.

bout that

ur accident and telling

received a letter f

me you would be around
Between your lott

the bank, including a
I get a very good pict

s and one or two from others at
s rather insulting communication,
s going on.

It does not promote ap-

or peaee of mind and then I was disturbed by Treman's

petite,

resolved to ask permission from the Reserve

statement tha

Board to negot
for nearly a ye
Procedure is to

e with the Bank of France, after we had been negotiating

The Board's function is to apperve or disapprove; our
gotiate subject to approval or disapproval, and it is

41.

a bad procedure to ta_:e official action in that way, although perfectly

proper to consult informally, Which I would suggest being done instead of
taking personal action.

Treman sent me a copy of the cable to Cunli1fe.

Confidentially, I have just spent two days in a very careful study
of a letter to the Bank of England, which has been dispatched to Now York

2.

January 9, 1917.

er. cartis.

and thich, very confidentially, 1 have gone over on technical points

with George Roberts, who is here and of course is familiar with these
questions of gold values; he was very helpful.

Nevertheless, the matter

is of such great importkInne that it ought to

New York by competent people.

,fully chocked in

It is the t I can do

advantage of the of the "advice of the

t here without

ly gilidems.

Sorr you are having trouble abou your Secretary

on't lot

those women boss you.

The arrangement abou

lanes, pa

me very much - more than y
ficiary.

this difficult and bustli
that you abandoned old
ings, then we need nal
. J. needs a
too cold,

down U that

jitime

he says,

I do just that

yours, pleases

thou_i you are the bene-

It jves no the

comfort, protection a

u1ar1

tell you that a tremonduous

ren. it has

to have you along side through

od of development,

if you are not sorry

bad company and disputatious surrow.d=
gret it I hope.

change and his doctor thinks Denver is
et him at Hot Springs, Ark. or any old place

try Where it is warm and balmy for a little visit any
it will do us both good.

Dr. Sewall recommends that

ng if I can get someone to join me for company, and the

.

same remark applies to you if he cannot get away and applies still stronger
to both of you, if you can both get a;my.
To me all indications of peace negotiations and collateral news
indicate that Gerilany is up against it and putting up a big bluff.

If

peace does not result, we may see a new period of frightfulness on the






To

January 9, 1917.

Mr. Curtis.

ooaan, possibly also on land, and then official Germany bowin- as

gracefully as possible to their awn people when they really sue for

peace, statihg that
U.S.A.

they cannot afford to fight the world, including

I am beginning to think the peace move was

intimation that Washington was finally go

inspired by some
sonally, I

o act.

s: tially the
right time, but bungled in the handling.rid yet that the
s still the
think the President's move was at

possibility of

the r

t time, or sub.

eace resulting; in this I know you wont

fail to get out here if possi

more, with you am.' Jay and

I woul

man, and get t

been going on and see if we ould not smooth
Give m;,,, love

that Z20.00 unless I happ

ke

real

tell her

ay else money that she knom of,

0 be trifling.
Affectionately yours,

Federal Reserve\
New York City.

BS/CC

story of what's

ngs out a bit.

ith warmest re

J. F. Curtis,

Don't

e one day, if no

in which case to pay my d
I hope your ace

Lee.

Denver, Colorado,
Januar 10, 1917.

Dear Judge:

1 have read the Minutes of the 9th Conference wit', much in-

terest and return the copy herein. On the

.

.ressea me

as being a progressive meeting, with

more accomp

d than

the one before, but I still thinic I
contains the possibility of trouble.

omit that ref

nce WhiCh

J. F. Curtis, Esq.,

Federal Reserve B
New Yor,c City, N. Y.

inc.



Denver, Colorado,
January 10, 1917.

My dear Ur. Curtis:

Yours of the 5th, enclosing copy of th
Conference of Governors, is just recei

full report, but as to tonic 4c, the

I have n.

t read the

ference apparen y tooK no

action upon that subject and it appear to be a report
the
Secretary as to what he had d
tion to pre
s actions
taken. In my opinion, no

'ad b including it

in the report.
Thank you for eadin

read.

J.

Federa

tis, Esq.,

New York




serve Bank,

eh I will return When

Denver, Colorado,
January 11, 1917.
PalS,ZAL.

Dear Judge:

It was nice to get your bully letter of the 8th and Miss
tatus with

as to yo

Carlton promises to permit no more confus
4

the

It was oossibly due to the

Board.

t that with

.' .-rnors and

doctors over there in profusion, it seer d necessary to I fish them
also with a judge.
Thank you for the advi
not go to Washington.

I'

Also

lanations confirming

for various othe

views that I already held, 1,,bered from var

let

sent a rather

tp Treman

England, which I am sorry
itten,
:ign

the infl once of a pers
ter which

signing a

s

sources. I have

essed to the 3ank of
n the bank's letterhead.

Possibly the first page

Treman may prefer t'

which should

por

:bout thos

it.

or, if it

is all re-written,

e only point In my signing

it was

on and a little ridiculous pride in

may give effect to a

hnnking alliance of his-

torical import
Don't wo
at the bank, and

about my resignation - I have got one

on file already

guess as long as the bank is in the vocative,

wont do

any more about it

4

guess juet now is that the

Ille,f
.

leaA investigation will be

permitted

ie, i it is not killed by congressional assassination, but I would like
j.

to see the thing

cleared up.

I have sent Hr. Treman some comments on all the amendments which
came to me, in rather unfinished shape, and 1 am just sending him copy of




P.

To - Mr. Curtis.

January 11, 1917.

another letter recent347 written to Warburg on this subject.

matters that really require discussion to

in

capped

bring out views,

These are

and I am handi-

expressing any opinion here.

A word about that article you enclose.

You know I have alwggs

definitely and with great determination s

face

at entertaining

any ideas such as suggested in the latt

Dart of this a

cle.

be most reluctant to Change my views, b

if there is any

round for do-

ing so, I would like to know it.

I

I have not read the "P
engaged

Nitil

What do you

think

eat

Mr. HUrst's be

1.

you

I will

lf?

, just now being

my of War", afterwards

expecting to tackle those
Please give
yourself.

I hope your

rds and the save to
promptly.
ully yours,

J. F. C tie, Esq.,.
Fedora
serve Bank,.
New York

BS/CO







Denver, Colorado,
January 19, 1917.

Dear Judge:

Thanks for yours of the 13th.

i am reliev

o make formal ap-

tion you mention, for it would have been a mist

plicatian as I have

written Jr.

about the applica-

Tre

There are two sets of French

set in a

money: one the

asking that it be put in

scrap book Which I sent you fro

small paper

he other is a

the tin box or some other sa

box filled with little envelopes,

one containing a few specimens.

I hooe that they have

They are rare and will be

very difficult to g
bill sealls to be

Your guess ab

u awe me

it would be a good plan to do

the

with what Laura had left aver.

same th

Irr

was a stupid b

my

Mrs.

ke for me, so you might hand her

UCLaren has various

the cash

correct.

for me to mention Hot Springs, Ark. in

letk I :::: Cas,1! Hot Springs, Ariz.

When it rea

This letter will be stale

t the situation today is as follows: I decided to

suggest Chandler, Ariz. instead of Castle Hot Springs, not only because
the hotel is good, but it is in a most interesting country vhere they

have those

petrified forests and other wonders.

gram I called the hotel by
tmpossible to get rooms.

On receiving your

tele-

telephone and after some argument, found it
I also ascertained that everything on the Santa

Fe road down to that country is booked except on

the 27th of this moth,




To - Ur. Curtis.

January 19, 1917.

so I switchbd back to Castle Hot Springs, as I telegraphed you yesterday, and I am now awaiting a telegram from there as to whether they
can give us accommodations.

Springs, as the Antlers

If not, I am proposi

there is a splendid hote

Robert Masson, whom you met through

,

to suggest Colorado
nd besides that

Casenave, wil be there and I know

you will enjoy seeing something of him.

464

at definite word

to you before long. You can imagine 1337 delight at th
visit with you and Green.

J. F. Curtis, Ssq.,
Federal

Reserve

New Yoric City.

BS/CC

Bank,

ospect of a

cal

11111 WESTEL'71AEM

UNION

WESTERN UNION

f. E. ATKINS, VICE-PRESIDENT
S No.

TEL

AM

NEWCOMB CARLTON, PRESIDENT

TIME FILED

he following Telegram, subject to the terms
tck hereof, which are hereby agreed to

J.

iff

A.

BELVIDERE BROOKS, VICE-PRESIDENT

CHECK

.11ver, Colorado, January 19, 1917,

Curtin, Fedora' 1:ee.vve aUit., New Yr-. City.

,riglIsh letter mallod last niLAt. Approve your mailing
addition socotestod /)! oodward vihan it arrtVoe
Benjamin stront;.

Benj. Strong,
41,10 Uontvisw Blvd.

Donvor



Form 260

WIEW

ALL TELEGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING T1
To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office
For this, one-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TEL
l'AlD FOR AS SUCH, in consideration whereof it is agreed between the sender of the telegram and this Company as follows:
The Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegrt r
amount received for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivety, of anyREPEATED telegram, bey'
the sum received for sending the same, unless specially valued; nor in any case for delays arising from unavoidable interruption in the working of its
errors in cipher or obscure telegrams.

In any event the Company shall not be liable for damages for any mistakes or delays in the transmission or delivery, or for the non-deliver
gram, whether caused by the negligence of its servants or otherwise, beyond the sum of FIFTY DOLLARS, at which amount this tel.er- . is hereby
a greater value is stated in writing hereon at the time the telegram is offered to the Company for transmission, and an additional sum pa- or agreed to
on such value equal to one-tenth of one per cent. thereof.
The Company is hereby made the agent of the sender, without liability, to forward this telegram over the lines of any other Company who
reach its destination.
Telegrams will be delivered free within one-half mile of the Company's office in towns of 5,000 population or less, and within one mile of suel
cities or towns. Beyond these limits the Company does not undertake to make delivery, but will, without liability, at the sender's request, as his ag
expense, endeavor to contract for him for such delivery at a reasonable price.
No responsibility attaches to this Company concerning telegrams until the same are accepted at one of its transmitting offices; and if a tele
such office by one of the Company's messengers, he acts for that purpose as the agent of the sender.
The Company will not be liable for damages or statutory penalties in any case where the claim is not presented in writing within sixty day
gram is filed with the Company for transmission.
No employee of the Company is authorized to vary the foregoing.

THE WESTERN UNION TELEGRAPH
INCORPORATED

NEWCOMB CARLTON, PRESIDENT

CLASSES OF SERVICE
TELEGRAMS
A full-rate expedited service.

NIGHT TELEGRAMS
Accepted up to 2.00 A.M. at reduced rates to be sent during the

night and delivered not earlier than the morning of the next ensuing
business day.
DAY LETTERS
A deferred day service at rates lower than the standard telegram
rates as follows: One and one-half times the standard night letter

rate for the transmission of 50 words or less and one-fifth of the

initial rate for each additional 10 words or less. Subordinate
to the priority of transmission and delivery of regular telegrams.
Must be written in plain English. Code language not permissible.




Telephonic delivery permissible. Day Letters receiv
express understanding that the Company only undertal
the same on the day of their date subject to condition
time remains for such transmission and delivery during
hours, subject ' to priority of the transmission of regu

NIGHT LETTERS
Accepted up to midnight for delivery on the morni

ensuing business day, at rates still lower than standard 3
rates, as follows: The standard day rate for 10 words sl
for the transmission of 50 words or less, and one-fifth of
day rate for 10 words shall be charged for each additior
less. Must be written in plain English. Code lang
missible. Mail delivery, postage prepaid, permissibl

Denver, Colorado,
February 15, 1917.

Dear Judge:

Your visit was a perfect delight and I cannot tell you how much
o unburden myself of

real good it did me to have ten dais with y

ight months

all the accumulations of the last six o

the telescope

You now have taken a peep thro
distance from affairs, realize that ii

ome ways one's

nd I hope

rate more comprehensive from a

can stir up our

the bill at the hotel

Ari

ending one more day than you

was $111.70, so maki

about ,54.45.

did, I figured that you

I feel as though I owed

your trip out did me a world of good.

you a great deal more,

oon and reached Denver yesterday after-

I got accommodations

trip, paid up all the bills in Phoenix,

ter a very co

eturned his books, said goodbye to him for you,

called on
-

sten is at any

So much f

The bill at t

noon

at this

ree ar not in good shape

partners on some matters
at the office.

uses

forwardinc; your mail

and left a card at the Arizona

left directi

for

Club, so i ho

all the chores were cleaned up.

Give as

d an account of me as your conscience will permit to the

boys at the office, and again many

thanks

to you for devoting good vacation

days to visiting the invalid.
Faithfully yours,
James F. Curtis, Esq.,
Federal Reaerve Bank,
New York City.

BS/CC







Denver, Colorado,
February 15, 1917.

Dear Judge:

I am sending a remittance of
today.

This is in payment

James V. Curtis, Esq.,

Federal Reserve Bank,
New York City.

CC.




Denver, Colorado,
February 23, 1917.

Dear Judge:

am returning with this Mr. A. Maurice L
Which I have read with a

Blockade and Contraband,

Possibly I am justified in using a phrase which I

your lips - to the effect that it conta
than

omitting myself.

for some strange reastoes not ouch

In connect

It

reminds

f on various subjects that

I did not know enough about to just

You pro

assertive

bit amaturieh.

it 18

me of some of the staff I have

come across a

glad to add it to a illection

ea nX I have heard from

In part, it

convincing and certa

If you happen

deal of interest.

s n tngn. To tell you the

truth, it did not impress me very s
rather

s article on

of doc

sed tend me some

with the wo

the subject of
e

Furthermore,

the mails.

opy of this, I would be

nts I have on this subject.
oriel on the subject of the Budget.

owe are doing in that matter, have

come aor s an Pmglish bo

written by E. Hilton Yoang, M.P.,

1915, en tied "The Syste

you

published in

f National Finance".

been led
suggestions,

te him a long letter, containing a few modest
oaring up the constitution, and a few other things

liKe that, and have an extra copy

until

for you to read , but don't dare send

it

after I have first read your production.

I am getting along

first rate, have

caught up with my mail and am

looking forward today to Masson's arrival. He is going to spend the night
with me and start east tomorrow.

?lease give my love to Laura and tell her that I will be writing




4.
February 23, 1917.

To - Mr. Curtis.

her in a few days in answer to her last letter, which 1 avreciated
very much.

Best regards old man, from

Yours faithfully,

J. F. Curtis, Esq.,

Federal Reserve Bank,
New York City.

BS/CC




me'

Denver, Colorado,
February 26, 1917.

Dear Mr. Curtis:

Yours of the 23rd, containing copies of telegrams exchanged with
Monsieur Pallain, has Oust reached me and it

was now in the best possible shape.

forget in

Do

matter that we have not referred to po

Possibly in view of

ing to post pone the matte
return of the revised mem

eriment with tie Federal Reserve

Esq.,
F. Curtis,
Federal Reserve B
New York City.

BS/CC

Board may be will-

velopments

or a While.

will

y and not delay the

ndum for Pa/lai-

Yours very

J.

sidering this

ible LIoratoria.

This is not a very good tine to e
Exchange.

s though this matter

cerely,




Denver, Colorado,
February 26, 1917.

Dear Judge:

to the Federal Re-

I am returning the draft of a proposed

will explain

made one or two pencil suggestions Wh
Paragraph (a).

It will be a poor

cement, and have

England

serve Board on the subject of the Bank

an to permit

s letter to

they

e cable to Wh

give the impression that the

object was

confidence really ef-

inspired, if you please, b

think you are fully justi-

fected me personally as

esponsibility for

fied in sending a letter

that

in-

quiry made through

On page 3, last pa

I think it

to that Ur. Lorgaa

the phraseology so as
any censorious

rt
had that

o the Bank of

stet

but that what

may be just as

Iv

is enough an

onism in the air already and we

to appear to

eve this difficulty On

Harding's letter,

that a

crossed a

was responsible for

Lngland through his

ressions contained in the cable might have

arance were really inspired by

Your let

well to alter

letter of

copy of which he

to Mr.

mine to

telephone request.

must be very

There

careful not

Liorgan's shoulders.

Mr. Treman,

commenting on

sent me, and I cannot help but feel

good deal of the difficulty respecting this cable correspondence

was really due to lack of consideration at the bank of my own vieee, sent

by telegram from Phoenix, in which I stated

that

these cables were personal

matters, over Which, *s a matter of fact, the Committee of our Board had

no control.




ex,

2.

To - Mr. Curtis.

February 26, 1917.

On the whole, I think your letter is just, but just about as harsh
as the letter from the Reserve Board.

Personally, 1 do not care haw

harsh a letter is sent so long as it is framed
bring down the swath of the Board on uneffendi

in

such a way so as not to
officers of the bank,

when really the whole resnonsibility f
to end rests upon me and, frankly, I

ons from beginning

ve no desire to hirk or avoid it.

If the Board wants to fight

ectly willing to

do so and tell them frankly

their performances.

But, personally, I do not
be censured for sometbin
As to the principle

our directors should
ctly my own affair.

made clear, I am in

hearty agreement,

merely yours,

J. F. Curtis, Esq.,
Federal Reserve Ba
New
rk City.

BS/CC

Since
'. S.
ctating the above the local newspapers contain rather
ominous news
ut the war situation and state that the President is to
address Congr s this afternoon. I don't want to advocate a policy that
will simply stir up trouble in the System when heavy responsibilities
must be carried by the Board and by ourselves, and it may be prudent simply
to address a letter to the Board stating that there were certain errors in
Treman's letter which as a matter of record, now that the Board has
made a written record of the subject, which must be corrected, but in Consideration of the disturbed conditions it has been decided to postpone any
further correspondence until the situation is clearer, meantime makin_ clear
that the officers or the directors of the bank insist upon clearing the
record in view of Governor Harding's letter. It is hard for me to judge of
these matters from here because the days are Italeidoscopic and beyond everything Prudence and conservatism should characterize our attitude.

Denver, Colorado,
February 26, 1917.

Dear Judge:

Thanks for yours of the 21st about the directors' records.
Let me explain thy I made the suggestio :
The records of a bank are like
The books of original

bones when the

entry

construction

are repre

ted by the tip

fan is spread out .and those records

through the various books '

where all transactions

a lady's fan.

-ntry,

reported and th

authorized, viz.- the Mi, ie book and the

f each of the

d all lead
ral authority

e all transactions are

ord of the reports

to the

f the fan. Few men in con-

directors; that,

sidering the organizati

ake the trouble to get the real per-

spective as to these r

you know my anxiety

shall be a model of

n that regard, hence these fatherly re-

Yours very
4




J. F. Curtis
Rose
New York Cit

Federal

Bank,

sincerely,

that our little bank




Denver, Colorado,
February 26, 1917.

Dear Judge:

Thanks for yours of the 20th.

The cap has been sent but so far

the only footwear Which has turned up i

()eke, one of which

ing stock tee whether there

was torn beyond repair, and we are no

is anything more such as golf stook'--, etc.
t we did not

I have heard from Jerome Greene and I am amazed
get his wire.

Don't worry about b
that bank, and almost th

bank.

ay

part of the Senior Mee

trouble,

j5

r e

leek

The trouble with
of capacity on the

r own work effectively, and

o organize

this is very largely

ngness, or inability, to learn

how to delegate less

matters to subordinates and to have this

act of delegation a

so that the machinery of the bank,

eir regular routine, will take care of

without detaching pe

done by the officers; it is a matter of

a

training.

obstacle in

unhesitating
ter than some

swer the Question as to

at is the greatest

e way of a man's developing into a real executive, I would
answer - ''His

own conviction

that he can do things bet-

her fellow".

I am glad to learn of Jay's success in ';iashington.

I rather wish

that Treman had undertaken the job so that there might be no aopearance
of timidity on his part in meeting. the Board.

About Governors' Conferences, if Harding discourages them I nevertheless think they should be held but, if possible, without ignoring the
Reserve Board.




2.
February 26, 1917.

To - Mr. Curtis.

I am writing separately, commenting on your "condone letter".
Backus' death was a great shock

to me. He and I have been
e have

since I was a boy of ten or twelve.

always

friends

fought more or less

but still have remained friends.

I like these

hand-written letters o

freedom of restraint imposed by $the c

exhibit the
ordhip of a s

ographer and

typewriter, so lets have some more o

With every good wish and love to Laura,

J. P. Curtis, Esq.
57 East 52nd St.,

New York City.

?. S. Again referri
of a letter from th
or on another Go

the

ish. ?here is
situation I do

news.

I have just received copy

ssed to Treman by Harding, throwing cold
lug on the ground that the times are
iii the suggestion. If we are going to have

hk a meeting should be held, thus taking all

ors away from the banks.




Denver, Colorado,
March 2, 1917.

Dear 2r. Curtis:

Yours of the 24th ult., containing suggestions for revision of
d I have been spend-

the Bank of France memorandum, reached me 7
as well as

lug some time in studyin_ over the
letter addressed to Pallain, concerni
(1)

Now as to the memorandum,

thich 'you have s
I

hink all the
raph 8

are good and much to the point
add a clause

following the

ount of oblige

es proposed
ems to me we should

on payable in gold
y one institution In
ated in paragraph 16

at any one ti
be limited as

difficult to make clear and I

The reason for the addit

ransaction:

will illustrate it by a

41.00.

we can buy 5-francs 85

At today's rates of exchange

If we invest in francs at that

of France, there is nothing to prevent

deposit them

rdering-the Bank of France to ear-mark gold for the amount of

our at

these francs,

cost of moving

we were

ested no changes.

substantially as follows:

"And in general th
Which may be incur
favor of the 'ther
below".

rate

lishing up the

able to

gold, it would

to ship the gold to
e gold were normal instead of

gland. .Assuming

abnormal as at

that the

present, and

y these francs dawn in New York in the form of imported
y take 5 francs and 18 centimes of this gold to repay us

the original cost of 41.00, Which purchased 5 francs and 85 centimes, so

that our profit would be the difference between 5.85 and 5.18, Which is, of
course

the amount of present

depreciation

in French exchange.

This kept




2.

To - Mr. Curtis.

March 2, 1917.

up indefinitely would either restore French exchange to normal, or pump
the Bank of

France out of

These figures are rought and I am only

gold.

stating the thing theoretically to illustrate what should be guarded against.
Practically, the transaction would not be possible, because we could not

It is, of cour

physically move the gold.

happening that the Government has prohl
countries would be buying francs at a

just such things

ed gold expor
count and takin

bank of France, probably storing it in some neutral c"
The addition of the proposed
while we will conatrue the

ld out of the
like Switzerland.

nk of France

,,-e Ind

that

eament as imp.- ng an obligation upon them

to liouidate everything owe.. to us in gold

which may be incurr

otherwise neutral

et the amount of the debt

ubject to t,- r own control, as provided by

clause 16.
(2)

Please refer

tter of February 11th, addressed to Mr.

Treman from Phoenix,

oints requiring soecial investigation,
let ed.

some of which are stil

Mr. Cann has just written ma of his acceptance of an offer
4 y regret.

from Canada,

experience in
necessity for

He is a valuable man, having much

nes where none of the others have.

It emph

ting a man that knows about foreign exchange just as

promotly as pos ble. Mr. Cann himself may

be able to help in this.

The Assay Office men can undoubtedly give information about
French coinage, as they handle considerable quantities of it.
I would like to know whether L'ir. Jay submitted the details

of the proposed arrangement

with the Bank of

France to the Federal Reserve

Board, or simply submitted an application for consent to the appointment.




3.

To

'larch 2, 1917.

Mr. Curtis.

The changes in the letter to be addressed to Pallain are

(6)

all of language and not substance, but I cannot prepare a final draft
of either letter or memorandum until I hear from the office about --

If the Assay Office can be persuaded to waive the 54

(7).

around.

charge for bars, it will simplify the arrang
Bank of

matter clear to him

will not tak

officers of

that

s kindly to

the Bank of Fjrce as the

the Bank of England
When the memora

(8)

took

d to make

a lot of correspondence with Cokayne of
and I fear that Pal
11
the suggestion of putting such a charge

It

it should be carefully bour

is finally

the original copy sent

as one document

one steamer and another

with an original lett r by

sent by

complete set

Shape to be forwarded,

fferent steamer.

I suggest

t margin instead of at the top, that

that they be bound along

being the French custom
sections in foreign exchange matters

Correspond

(9)

y and care than

ted with more

are co

our

domestic transactions.

rstands these matters, his first job should be
to sketch up

of drafts, forms of advices and other matter of that

kind, which sh lid be
(10)

er

in

the best form possible, and ready, in advance.

that we may be ready to act promptly, I think we

should get up the forms

of

letters,

resolutions, etc.,

together with a

form of agreement, to submit, for use with the other eleven Reserve Banks,
and have them all ready to send out
concluded.

just as soon as the arrangements are




4.

To - Mr. Curtis.

March

2, 1917.

The consent of the Federal Reserve Board

to the appoint-

ment of the Bank of angland was coupled with a requirement

that the form

of the agreement for participation by the other Reserve Banks must be

submitted to

the

Board for approval. That strikes me as

and, of course, should be undertaken info

being reasonable

nromptly and in ad-

vance of submission to the banks.

It is going to
to the

be most tIIJ

terms of our arrangements in Lo

mulled over by 120, or more, pet.

which is used for these co

an autbimiz

ank

directors

tive

Before eit

our

tors must

of the agreem

t

rint

that the paper

in red across the top

t'..,

and must not be
officers or directors
addressed."

respectively.

London or Paris arrangement can be opera-

pare a'Resolution, authorizing the adoption

or memorandum authorizing the opening of

so

are to be

s to the amount of money which we

and their cond t Anki authorizing

they prescribe,

they

and Paris,

t the nresent coneensus of view of the

should employ in Loud
4)

avoid a teak in relation

refore, 1

s are confiden

othe

of the Fede

officers and

to

statement of the °liming general character;

"The cont

r13) I would like t

ti.

cations hat-

in some conspicuous place

disclosed

cult

the accounts

signatures to drafts by such method as

authorizing the endorsing of drafts.

will be the authority for the officers of the babk to emnloy some of our
money in these foreign transactions Prid, of course t

to act for the other

eleven reserve banks.

This is all I can think of in

connection with our proposed foreign

T




5.

To - Mr. Curtis.

March 2, 1917.

arrangements, and I will send the completed letter and memorandum just.
as soon as I hear about the assay charges.
Very sincerely yours,

J. F. Curtis, Esq.,

Federal Reserve Bank,
Mew YOf4 City.




IAanver, Colorado,

March 2, 1917.

Dear Judge:

Your telephone message was only next door to a visit, but I
an sorry we did not have a better connee

Likens' first letter to me (Whic
was a very definite and positive de

enclose) you

11 observe

on not to come

New York.

I felt that it was so definite that I could not urge
as he had already met Mr. W

Pea

, particularly
d they had doubt-

less discussed it to a fity, but a fe .ays later I got another
latter from him, which s

or a bit, so I at once wrote

him again just on
think it was on tionda

able to move him, and then,

s week, I telegraphed him, urging

that he try and arrangout to se, me
crossed one which he

ceiving my letter,

any way.

This telegram

espatched to me immediately upon re-

he would endeavor to come out to see

u].d telegraph e initely in a day or two. I then telegraphe
hie again,
adan of doing so, as I really felt that the
me a

situation

sufficiently important to require a personal meeting before

final decisi
My decis n in sending him this telegram was hastened a bit by a

letter from Warburg, in which he rather casually referred to a meeting
with Aiken in which Aiken had communicated to him his decision, not nec-

essarily final however, not to come to New York. I only got Aiken's

reply day before yesterday and was awaiting his further telegram before
deciding whether it was worth while to communicate with the office about

it.




2.

To - Mr. Curtis.

14arch 2, 1917.

e thing I find it difficult to explain is the positive character
of Aiken's first letter, Which is enclosed, and then the terms of his
second letter, which seem to leave a loop-hole.
I hope you may make progress with /I'

and I will see What I can do.

Very 4 erely yours,

J. F. Curtis, Esq.,

Federal Reserve Bank,
New York City.

lines.

send him out here




Denver, Colorado,
iarch
1917.

Dear Judge:

Referring to your letter about the Ban-fl of France communication,
I want to

continue our conversations

at Ph

France mtter to illustrate one of the

deny procedure of the bank.

about the or-

Your let

was signed by

one slight change in it, after apparently taking it ho
and

then added a postscript t

ition of hand-written post-

scripts, or making

letter, so that the

in the bans does not co

am

WT

.

as to the wa
everybody seem

are just on th

Jay perso

record

the other end of the line.
Th c

Importance as a matter
The real point

town,

not be taken out of the

then

It is of slight importanc

or up

some value as a

record of the business of 't

bank in that way and

Jay, Who made

respondence with me, but of considerable
actice.

this

ter,

however, is to advise you

that i

y a little letter of complaint and protest

gold bars has
to take a crac

been handled.

In the first place,

at it and now at the last minute, when we

ve of sending our letter to Prance, the terms of

which are

dependent soma t upon the arrangement made about these assay office charges,
Mr. Jay sends me telegrams, asking for,

further

information.

to call your attention to the fact, as I have his, that i wrote the bank
some months ago, urging that a study of this subject be made so that we would
be well prepared in advance to deal with it.

The proper course to have




2.

darch 2, 1917.

To - ;Ir. Curtis.

followed upon receiving my fIrct letter would have been to assign one
of the Junior officers, or pcseibly two of them, to ricking a thorough in-

vestigation and report, as was done in the matter of Fiscal Agency affairs.
Apparentiy that course was not followed and the bank seems to be relying

I hate an

certain its feasibility.

ought to try

to develop it i

stall and as-

se last minute

- 'hor and distrus

ore.

deci

half-baked.

here, that

-estion of what

really only permit we to me=ze a broad s

and do, relying upon the man at the b

ant

t I ha

upon the very general information and via

Somehow or other

eiag applied to some of these

havL a fooling that pains

matters fequiring lnveatIaon and wiiore ac4qacy and detaiLis important.

k of England letter, the poor

'.nde

After -11 of our coi

never should have been

letter got off with a cla

there, re-

suiting' in Cualiffe's

w.$ .

aments

,e have further dealings to be couductod

h these fo7e16'n

tion

rve Board;

still to be effected in connec-

also negotiations with the other eleven banks; a

dling of the work in our on office.

lot of detail

I have en-

of the things that

deavored in my

oarate letter to

need to be done

but, frankly, these are matters of detail to some extent

yolg to suggest some

with which I ha e had little recent exoerience and I cannot personally rely

upon

Iv

own knowledge of these details to maKe sure that everything is

covered; that must he done bo

negotiations with the

someone that the bank must employ and the

aeserve 3oard and the other bans must be conducted

by one of the officers who is acquainted with this whole story and not by
a number of the officers. Po let us put the handling of this matter in




3.

To - Mr. Curtis.

March 2, 1917.

the hands of one Person, not lot it get scattered throughout the bank,
and hold that one 2erson responsible to see that everything is attended
to promptly and correctly, mthing anitted and no mistakes made.

I have net written Trenan as I have to you and Jay about this,

because I would rather lose an arm than hurt his feelings In the s1i8htest
degree it is up to you and Jay to arrant

you will write ne an encouraging report

se ma

the way they

and I do hope
e

oing to be

handled.

It is bad form for eta to be writing to you about
in this instance seems to /"ev

natter which
am doing so, how--

ever, becaese eTe tented it

n ?hoenix and I thinX agreed

that sonathingbad to be d

f the Sonior officers better
e to Nr. Jay, is simply to

orsnalged. This let

register my last kick on

su

ing letter as lone. as 7

but, if 1 ever get back and those rough

oleces are net smooth

dust f

ng about in t

You fell

will never write another complainyou ola man there is doing to be some

ba..

at mill make it a very uncomfortable place.

can afford to tete the tint() to sit dawn tnd talk these natters

over frankly

ves and I hone this letter ray inspire yo y and

Jay and Treman o do no.
Best re e

.s and go00. luck to your efforts

Faithfully yours,

J. F. Curtis, Esq.,
57 East 52nd St.,

New York City.
BS/CC




Denver, Colorado,
March 4, 1917.

Dear Mr. Curtis:

Yours of the 27th ult. is just received.

?allain's reply, which Mr. Treman telegra
founded my prophesy was that the anno

Also a copy of

me.

ph..e note how well

anoointment would be taken by Pallain a meaning much mo
does.

It is extraordinary how Fr

emotions come to

do hope that the necessity
crstanding and

very unpleasant thing to

one's pet

business,

ailure.

You knaa it is a

deflated.

ur letter, I can picture

.
and,

Don't get gay and enlist; that

I expect that one or both of my boys
the service if we really get

so opOosed to the Whole volunteer system that

down to
sometimes

or us to got licked than to subject the nation

think it woul

to the injusti

surface and

like Umslopagas, filing your

teeth in preparation for
Will f d a way into so

baa

ragraph o

you polishing up your wea

is not your job just

than it really

ich we have taken

will not result in some ml:

Commenting 0

making the

out of consent

and outrage of a continuance of the volunteer system.
Very sincerely yours,

J. F. Curtis, Esq.,
Federal Reserve Bank,
New York City.

\t\A
Denver, Colorado,
March 4, 1917.
r.RSONAL.

Dear Judge:

Thanks for yours of the 28th, enclosing check for ,308.510.

have sent the Piping Rock vouchers to Urs.

know whether the account is squared up

much, let me know and I will

ft

I

am blest if I
not; if you 0.,.z paid me too

refund.

is hard to suggest anyone to take Er. Cann's

experience which was needed i

He had

.

really disturbed

that he is leaving.

Ability to locate

aluable asset

lee

and it's got to be

who understands foreign

The only way

em is to hunt.

to reneat a suggestion

t I hav

location of the right

sho

done r

the bank

ellows, to get exactly the

right man to do the or
exchange.

in

If you will permit no

equently made about the bank, the
one man's job, and this ought to be

away without-any eelay, or we may be caught in a very uncom-

fortable sit
This ma

man is going to
really is nothi

d when we should be avermaned.

er of getting a good credit man and a good foreign exchange
in my mind until I hear that they have got them.

There

I can do from here, except to say "hunt".

I am enclosing, with diffidence, cox of my

letter to -eAdoo on the

subject of a Budget, which please consider as confidential.

After mailing

it I read the debate at the Constitutional Convention in New York, all

covering this same subject and I am satisfied that I am not as far wrong
In this matter as most amatures are




in

offering suggestions about other

2.

To - Mr. Curtis.

karc

4, 1917.

people's business.

1 am keen to get hold of that book on the budget to Which you
refer.

Treman has written
those Bank of

me of the action of the Committee regarding

England cables; the Whole

me a lot, because

distre

it really was badly handled at the offi

andwe seem to

with an unnecessary rumpus and yet will

cave a very bad

confronted

cord if we de-

cido not to have a ruMpus.

On the Whole, I

think

of the

that this is no time to b

lves.

for all of those matters r

matter is

The responsibility

d it should be put on my

shoulders, and

vs our

Reserve Board and then i

bank

say so to the

ow with me, 1 guess I can tackle

keep hard

the job as well as anybo

feelings out of the bank,

which is important.

am still await

bout Assay Offioe charges before corn-

pleting
r letter.

Faithfully yours,

a.

Cu_

IiidaTgI-Reserve Bank,

New York City.

atc.



2.

To - Ur. Curtis.

tdarch 4, 1917.

people's business.

I am keen to get hold of that book on the budget to Which you
refer.

Treman has written me of the action of the Committee regarding
those Bank of England cables; the Whole

distre

me a lot, because

it really was badly handled at the of ft

andwe seem to

confronted

with an unnecessary rumpus and yet will

eave a very bad

cord if we de-

cide not to have a rumpus.

On the Whole, I thin4

broadest

that this is no time to be

ghting among o

for all of those matters r

ly rests upon

shoulders, and 1

of the matter is
slvea.

d it should be put on my
ve our

Reserve Board AnA then 1

The responsibility

bank

say so to the

ow with me, I guess I can tackle

the job as well as aaybo

keep bard feelings out of the

bank,

which is important.
am still await

pleting

bout Assay Office charges before corn-

etter to Pallain.
r letter.

Faithfully yours,

A.

F.

Curt

FedeTSI-fieserve Bank,

New York City.
BB/GC




Denver, Colorado,
March 7, 1917.

Dear Judge:

Thanks for yours of the 3d, with t
letter. I have sent him a reply as per

in our files.

allain's
closed copy,

ch can go

It is a strange thing that the French Consul her
to whom I telephoned about t

that he knew nothing Whatev

letter.

J. F. Curtis, Esq.,

Federal Reserve Bank,
New Yor- City.

BS /CC




t Denver,

ble came, claimed

never heard of such a

Form 1217
CLASS OF SERVICE DESIRED

Fast Day Message

.y Letter

InfESTE ISn

UNION

TEL' AM
WESTERN UNION

Night Message

Night Letter
Patrons should mark an X opposite the class of service desired;
OTHER "'SE THE TELEGRAM
RANSMITTED AS A
WILL .

FAS DAY MESSAGE.

Send the following telegram, subject to the terms
on back hereof, which are hereby agreed to

Receiver's No.

Check

Time Filed

NEWCOMB CARLTON. PRESIDENT

CO?Y.

Denver, Colorado,
March 7, 1917.

J. F. Curtis, Federal Reserve Bank,
New York City.

Omissions regarding abrasion foreign coin due to my having no
data which I requested Balm to investigate and then overlooked.
Think clause
covered by separate letter requesting suggestions stop/.
waiving advantage future Moratoria is desirable if you consider such
provision is even morally binding.




Benjamin Strong.

It can be




ALL TELEGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING TERMS':
To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for comparison. For
.-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FOR AS SUC,
consideration whereof it is agreed between the sender of the telegram and this Company as follows:
The Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond the amottm
eived for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery, of any REPEATED telegram, beyond fifty times the sum received
sending the same, unless specially valued; nor in any case for delays arising from unavoidable interruption in the working of its lines; nor for errors in cipher or obscure

?grams.

In any event the Company shall not be liable for damages for any mistakes or delays in the transmission or delivery, or for the non-delivery, of this telegra
whether
used by the negligence of its servants or otherwise, beyond the sum of FIFTY DOLLARS, at which amount this telegram is hereby valued, unless a greater value is stated in
citing hereon at the time the telegram is offered to the Company for transmission, and an additional sum paid or agreed to be paid based on such value equal to one-tenth of
le per cent. thereof.
The Company is hereby made the a,mt of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to reach its

astination.

Telegrams will be delivered free within one-half mile of the Company's office in towns of 5,000 population or less, and within one mile of such office in other cities or
Beyond these limits the Company does not undertake to make delivery, but will, without liability, at the sender's request, as his agent and at his expense, endeavor to
Jntra c t for him for such delivery at a reasonable price.
No responsibility attaches to this Company concerning telegrams until the same are accepted at one of its transmitting offices; and if a telegram is sent to such office
,wns.

y one of the Company's messengers, he acts for that purpose as the agent of the sender.
The Company will not be liable for damages or statutory penalties in any case where the claim is not presented in writing within sixty days after the telegram is
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Special terms governing the transmission of messages under the classes of messages enumerated below shall apply to messages in each of such respective classes in addition to all

he foregoing terms.
S. No employee of the Company is authorized to vary the foregoing.

THE WESTERN UN ION TELEGRAPH COMPANY
INCORPORATED

NEWCOMB tARLTON. PRESIDENT

CLASSES OF SERVICE
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A full-rate expedited service.
NIGHT MESSAGES
Accepted up to 2.00 A.M. at reduced rates to be sent during the night
and delivered not earlier than the morning of the ensuing business day.
DAY LETTERS

A deferred day service at rates lower than the standard day message rates as follows: One and one-half times the standard Night

Oi:Letter rate for the transmission of 50 words or less and one-fifth of
the initial rate for each additional 10 words or less.

SPECIAL TERMS APPLYING TO DAY LETTERS:

In further consideration of the reduced rate for this special "Day
Letter" service, the following special terms in addition to those enu-

merated above are hereby agreed to:
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'deferred service and the transmission and delivery of such Day Letters
is,

in all respects, subordinate to the priority of transmission and

delivery of regular telegrams.

Day Letters shall be written in plain English.

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Is not permissible_
c. This Day Letter may be delivered by the Telegraph Company

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events; but that the Company's obligation in this respect. is subject
to the condition that there shall remain sufficient time for the tran.smission and delivery of such Day Letter on the day of its date during
regular office hours, subject to the priority of the transmissiOn of regular telegrams under the conditions named above.
No employee of the Company is authorized to vary the foregoing.

NIGHT LETTERS
Accepted up to 2.00 A.M. for delivery) on the morning of the ensuim
business day, at rates still lower than standard night message rates, a
follows: The standard day rate for 10 words shall be charged for the trans
mission of 50 words or less, and one-fifth of such standard day rate for 1
words. shall be charged for each additional 10 words or less.
SPECIAL TERMS APPLYING TO NIGHT LETTERS:,

.

In further consideration of the reduced rate for this special "Nigl
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Night Letters shall be written in plain English. Code langua
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D. This Day Letter is received subject to the express understandis not permissible.
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No employee of the Company is authorized to vary the foregoing.




Colorado,

Denver;

March 15, 1917.

Dear Judge:

Yours from Boston is just receive& on my return from Chicago,

Where I had a bully visit with Aiken and McDougal.
my let

Jay writes me that he has turned

gold matter, together

correspondenc

with the copies

ttacned, to

tter was sent

you without detailed 0-rumination; tha

to him for his own

egarding the

do mightly lit

benefit and it will

good to have

Again let

hiqelegatc examination of
inc suggest a further cult
Mry letter of March

to the effect that

tter received from Mr. Jay

referred to a

subject of Assay

vestigate

charges and let me know

Office

t I could incorporate any changes

ry, but

necessary as a result

after waiting some days and

Lied making any change in the Pallain

hearing nothing furt

and memorandum and sent it on to you.

I completed t

letter

pt of selective values".

tion of the"co

f the 6th 8: 8th, Which antedate your Boston hand-written

the various points covered by my recent letters

letter and

on this subje

with all of th
now that

the

are before me,

but

I want

to

read them over carefully,

correspondence before me, before replying.

I understand

tors are on the way to France and only wish that I was on

the way there too.

Best regards and many thanks for your patience in this matter.
Very sincerely yours,

J. F. Curtis, Esq.,
Federal Reserve Bank,
New York City.
BS/CC




Denver, Colorado,
March 15, 1917.

Dear Mr.

Curtis:

I have just been over yours of

the 6th and am somewhat puzzled

when finally

as to just what shape the Bank of France
mailed.

Apparently, the changes ment jd in your, co

rate memorandum enclosed therewith,

ld not have

refe ed to

signed copies Which I mailed to the bank on the 2nd,

changes had already been mad

pii400M1

ther" occurs in the last lin-J

should be the word "other".

The change in No. 11-(a)

course, all right now that the standards

The corre

raph 8. making a period after the word

"ownership" must ref

ther

t is the conclu
The

than

the signed copy sent you, be-

ng word of the paragraph in the one dated Larch
rch 5th contains the

Which you re

to.

the last sent

e of paragraph 21; in

of only

once.

one s

to

change in the last sentence

of the poroosed chang

5th.

use some of the

es sent on that date.

Referring to the M

are known.

the

your reference

lines, etc., do not corre

of 12-(e), but

ed by the sepa-

addition to

paragraph 8

I am unable to understand what you mean by omitting

mu opinion, paragraph 21 consists

The change in paragraph 19 is, of course, all

right.

The memorandum of changes suggested in the letter do not correspond

with my

last copy end 1 cannot tell exactly how to correct my copy.

I understand the is

ter

i

As

has been sent; won't you also send me for my files

40,

Otf*,

an exact copy of the final draft, eibodying all changes made?
further advices.

Very sincerely yours,

I await your




DENVER, COLORADO,
March 19, 1917.

Dear Er. Curtis:

Yours of the 16th is just received and i

you at once I am returning the draft of the

prop:\

de la Nacion Argentina, without retaining a copy a

er to get a reply to

letter to the Banco
without attempting to
t without any de-

recast it, as I realize that you will
lay and it can just as well be prep

the office.

Replying first to the c

nod in your letter:-

Paragraph 5,

sterling bills, was included

suggestin

of introducing our facilities be-

simply as a su,zestion to offer a
tween the Argentine b

ndon banks Which are now
entin

customarily employed

credits.

I thithink.:arburg

overlooks one matte

- the process of shifting comer-

cial credits f am on

as from London to New York, al-

most inva

y results

edits in

opening

in New York,

needs c
particula
delayed

both

or

if ste
in

,

rkets.

such as an Argentine exporter, at first

He may be drawing

bills

on London when he

1 thought it might prove an added facility,
communication between the Argentine and London is
to have a New York market for those sterling bills.

The matter is not particularly important and i certainly don't urge the
suggestion,

although

I think you will find that some

such

plan is alread:

in mind in connection with the arrangements in the Philippines, Where a
somewhat similar situation exists.

Paragraph 6 of my draft was included for a number of reasons, the




2.

To - Mr. Curtis.

March 19, 1917.

principal one being that unless some such business is conducted, the
whole arrangement is a barren one and really does not amount to anyThe Argentine bank carries balances now,

thing.

tant New York banks, and gets interest on them,

relations

with us are concerned, I cannot see the

their having an account with us which wi

The same thing is true as

not only see no object in open
in Buenos Aires, but I don't see
account unless through so
exchanges are liable

purchase of

ances in the

gentine.

1

there and keeping of balances
o account can be made a workable
angement.

In

the first place,

balance of the year, because of the

character of the co

tries, both of which are agri-

pile Up millions of dollars in dead

cultural.

balances

th an Argentine bank, with no other object than buying their
p

Paris a

to time

Al a considerable part of

the year and then a

friend

ur

ightest object in
i terest, unless we

are going to employ their balances from time
bills.

so far as their

4, 4 4

The situatio

Berlin that it

relationsh

there is so different from that in London and

straining matters a bit any way to attampt a
not include commercial banking and

including an investment feature, it might put us and them in

thought it

position

to

accumulate exchange in considerable volume when prices made it a purchase,
so to speak, and that the accounts could be liquidated when exchange advanced.

As for the qualification of my paragraph 2 about competition, etc.,
it strikes me as being all right and I can see no objection in the clause




3.

March 19, 1917.

To - Mr, Curtis.

as now

prepared.

If that paragraph, as well as No's 5 3: 6,

the scone of the proposed plan would be so limited as to be of no great

value to either party, either

in

normal times or

emergency.

Possibly 7arburg overlooked the fact that t

and exchange situation is quite different from tho

Argentine currency
prevailing

and that they have adopted in the Argentine and 1 bel
operation what is known as the go
of the Indian Bmpire.

redemption flInds in Europe

and in this country and if

t

agents, they might

not on1

vest the redemption
commercial bi

"

or L.,-

use-at bil

burg's thought
credit bl: a fo

under nos

edits ar

their exchange

custody of gold, but to
...

es and, possibly,

at times to in-

he India Council in London in

as is done b

Warburg bvestigated d

commerci

to act as one of

redemption p

honor their drafts f

e as that

the Argentine government and

the Banco de la Nacion Argent/

.

Europe

still have in

e currency, the

Unless I

,

in

These are matters which I assumed
trip and could advise us about.

#4 is only partly true.

The handling of

gn bank agency and the purchase of bills drawn

ansactions which go

hand in hand.

a small commission exacted for the commercial credit, there is always an
exchange

and a

discount profit on the purchase of the

say that the profits on the purchases of

bills

bills, and I

should

are 2, 3 and even 4 times as

great as the commissions received for opening the credits and I still maintain that the purcnase of long bills in competition with member banks will
be a serious tactical blunder and one which we would later regret.

Why

would it not be well to get the facts on this subject before coming to a




4.

To - Mr. Curtis.

decision?

Larch 19, 1917.

These can be obtained by a conference

with

the National City

Bank, the Guaranty Trust Co., the Bank of New York, Bankers Trust Co. and
other institution that are developing this business.
I have endeavored
endorsements.

to

answer above the inquiry in regard to mutual

If we buy bills for each

lily should guarantee

them; at any rate I would not think of
there without the guarantee of the Ban

sed for us down

de la Nacion Ar ntina,

required them to guarantee, naturally we must do so 0

Commenting in

general

the provisions for purchas

the le

lves.

the elimination of

f sterling bil

bills and, possibly, restri ting the purcha

account, would so

and if we

for investing

in

New York

of long dollar bills for our
sal as to render it of no

value.

Please note c

rding of paragraph 2.

bills are very defini
stood

commerce Which are thoroughly under-

those two wor

ref erre

Documentary

e documents attached are almost invariably

as shipping documents, except when the bill is drawn against

shipments of

gainst bills for collection, or against gold

shipments, an

t hardly seems necessary to make reference to those types

of bills in th a letter.
On page

you refer to our possibly ear-marking ,;old certificates.

To my mind this is a dangerous proposal.
certificates

in

The Sub-Treasury redeems gold

New York by paying gold coin which frequently has been in

circulation for a long time and is abraded anywhere up to 1/2 of 1%.

used to figure on an abrasion loss of 1/4 of 1% on the average in
._

We

3ith-




To - Mr. Curtis.

March 19, 1917.

drawing coin for Shipment to Europe when bars at the premium of
thousand could not be obtained.

If we ear-marked gold for our correspondent

and subsequently shipped the gold to

them, there 'ght be a loss of 1/4 of

or even more, which we would have difficulty
the importance of dealing with
emphasized.

&X per

this whole

explaining.

abrasion bars
is

matter o

My suggestion is to make n

and

gold certificates

whatever and state that we will ear-mark coin at its n
takina that the abrasion shall ne

value, wider-

1/2 of 1%, and possibly make

some explanation that we are evoring
can hope to get bars of practical

Here again,

get into a position where we

a

weight for use in transactions of

this character.
The suggestie.

f

holding go

the service seems a

ttle inconsiste

plan and it might be

ser to put th

se

;

on and making a charge for
any way with the general scope of the
clause in the form of an inquiry as

similar to those being made for another

correspstent, would be of any value.

my first draft

mitted an:; reference to a Moratorium.

prossion tbaJ Moratorium was
When the wa

I am

established in the Argentine

but just What the situation is now I cannot say.

It might be well to inqu3.re..

If it is decided to leave in the clause about purchases of bills
payable in dollars, I would advocate leaving in the sentence which you mark
as redundant on page 6, simply for emphasis.
Commenting only on the form of the letter, the first sentence




6.
To -

r. Curtis.

March 19, 1917.

impresses me as being weak and a

cordiality Which these

little lacking in the character of

South Americans expect.

On needs to make a very

polite bow in the opening and concluding sentence
fellows, Which I suggest be done in

f a letter to those

this case.
ascertain fro:: the

B7: all means before sending the

National City Bank

just what volume of business they

haw Important it is, so as to be
copy of the letter

Whenever it

the letter finally sent to Franc

side.

Won't

oing in bills and
u send me a

dispatched, also a copy of
Warburg Is satisfied with what

is being done in this Argon
Success

to you

the extent of keeping

Warburg happy about
°rely yours,

J. F. C
Secreta
Federal

New York

BS/CC

Enc.

serve Bank,

ty.




Denver, Colorado,
Larch 21, 1917.
CONFIDENTIAL.

My dear Judge:

Yours of the 17th was just what I needed.
I have been hung up out here so long tha

tell you the truth,

am ilk

chunk of venison

that has gotten a bit high.
work of the Se

On the question of reorgani

r officers,

Which should be a work of dire°

of actual drudgery, let me

make the following comments,

better at a distance than I

Three thi

in my mind in this connection

can face to face.

fore you:

which I want you and

ce make it extremely difficult

1. The etre

with you and him and impossible

for me to get into
for me to do
and roc()

oharaet

osed upon all of you by my absence

with

difficulties are duo to the temporary

ze how much t

ements made in mw behalf.

of present ar

d any difficulty in applying authority as

I have never
distinct

influen

o subordinates.

It does not cost me a pang to

chop the head off an incompetent subordinate in the bank.

That is not

true of those with whom one is associated on even ground and, particularly,

when they are men of equal or greater ability and brains, whom one deals
with as personal friends and associates rather than underlings, so I have
been guilty of a certain procrastination myself in facing some of these
questions with my own pals.




March 21, 1917.

To - Mr. Curtis.

No consideration of friendship, loyalty or obligation to an
ildividual would outweigh with me the obligation to the bank in having

it managed right, so, no matter what

it may invo V

and discussion, I think you and Jay and I have go
results that will relieve env of us of anxiety on
Your infernal modesty, or someth ng
you to assume an attitude of ignor

they

are and how

score.

has always led
,

to matters

nvinces me that that is all

You know just as well

bluff.

o cooperate to get

even indiffere

Your

of routine organization.

ust as b

in the way of pressure

I do where the weaknesses
, with my blessing, I am writing

should be correct

to say - go to it.

For a day or

o I was so out

I could have writte
eivdence of mg
ficient e

lavsi

r with that gold matter that
with great enjoyment, but it is

.

and mental

ol to do so.

attempt

to fix respons

that it

have to's

ato Ja;), from me, however,

that without

not the only t

fellows

.:40

m, rovement out here that I had suf-

Delano
"pronunciamentos".

bility, the matter was inexcusably neglected and

You
out the responsibility among yourselves.

ere Friday and I may hear news about these various
Without posing as a prophet, but rather as a sport,

I would be willing to wager a bet that the first announcement about Treasury

bills was made with the President's approval only after representations had
been made to the President by members of the Reserve Board and in McAdoo's
absence; that upon McAdoo's return he convinced the President that a mistake had been made, and that it was due to the President's insistence through

that

3.

- Ur. (Artie.

March 21, 1917.

McAdoo that the Bank of England
and that

the

announcement was

made on December 26th

recent announcement, Which I think has been called the Crow

Banquet, was simply a deferred righting of the mi take Which could not be

righted earlier without practically disgracing tReserve Board.
no information to substantiate this theory

but

be

ve

it

I have

strong enou,jh to

bet on it.

About the Argentine matter.

I am glad we are

ahead in a

tentative way because after all

policy of dela

upon very sound

t it was justified.

reasoning and

can come of the approach and co

Warburg's proposal that we

should go ahead blind
these matters and co

No harm

good will result through keep-

I am

lug Warburg happy.

is not based

tion from member banks, in
ainly would not

are primarily the in

opt that policy.

The Reserve Banks

tating and conserving the business
get that principle out of our minds

and beco
protect

Independent of our own proprietors that we don't successfully
d promote their

terests, we will begin to witness the decline

and fall

You

me abo

e Russian upheaval.

It whipped me off my feet --

not so much the revolution but the evidence of the personal distrust of the
Czar.

I have always had a good deal of confidence in the feeling of respect

and admiration of the common people of Russia for the Little

its Father

and would not have been surprised to hear of a wholesale massacre of his
incomnetent and Pro-German hangers on.




What has now taken place is so ex-

treme that I fear the consequences somewhat.

3ne cannot start democratic

4.

To - Mr. Curtis.

March 21, 1917.

ideas in a mass of 170,000,000 uneducated people and give them the reins

of authority without
for awhile.

having the vehicle bumping over a pretty rocky road

In other words, what forces can be r

tremendous tdvalution of

loose-jointed empire

government and

as Russia?

led upon to check this

ideas of

vernment in such a
table about it until

I won't feel co

we read of the Russian armies winning ?tor'

How

Just now one thought is much in my mind.

the Democratic

narty, including the President,

ople of this co try without

sinking hearts When they malt

y ars ago the ablest men in the

es to the

United States were literally on
that steps be taken

beg-

ountry against eventualities, by

he enactment of sui

127

army and navy.

Nothing

re of delay and what we do ac-

that we now can do
complish will be at

administration,

oost

almost

p a.

bitive.

appetite and after the elapse of a

am confident that

little t
and Mr.

ay to take a fl

spendin
to do this

it would be good business for Mr. Treman

say leaving on the Century on Friday, and
few hours wit
o in Chicago to discuss matters. I would like

before any opinion crystalizes as to a reorganiza-

tion of the bank's personnel.

Please

talk

it over with them.

Very sincerely yours,
F. Curtis, Esq.,
Federal Reserve Bank,
New York City.
BS/CC







Check

_ettor

ilould mark an X oppoclass of service desired;
.RWISE THE TELEGRAM
-L BE TRANSMITTED AS A
FAST DAY MESSAGE.

TEL

AM

"ime Filed

NEWCOMB CARLTON, PRESIDENT

Send the following telegram, subject to the terms
on back hereof, which are hereby agreed to

Denver, Colorado, elarch 23, 1917.

J. F. Curtis, Federal Reserve Bank,
New York City.

Telegram received.
Suggest cabling Cunliffe substantially as follow
We suggest tko rf'ollowin, four Changes in revised memorandum of liarch nineteen
First omit references in openin, sentence and in naragraph twelve to
sixteen.
conclusion of aar as we propose earlier start. Second omit provision In paragraph
six for ear marking gold only at convenience of debtor institution so 'Lhat account

will be definitely on a sold basis but debtor institution will be protected by
understanding that it shall name in advance the limit of sec'. obliee'ations to be
incurred. Third omit change in paragraph ten with respect to word voluntary so as
to conform to lest suggeetion. Fourth omit words if so agreed in paragraph twelve
under same understanding as In our second suggestion stop. As 40 contemplate
trensactions as sooa as pronosed arrangement ratified it is necessary in present
circumstances to define understanding that obligations will be mat in gold if not
otherwise settled but we would expect you in advance of operations to place the
limit which you desired upo. the amount of gold obligation which you would incur
stop. All other changes satisfactory. We will await your reply
End of cable. ?lease mail copy of
su,gestions before revising memorandum.
cable as finalleg sent.

Benjamin Strong.
Chg. Benj. etrong,
4100 klontview Blv.

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Special terms governing the transmission of messages under the classes of messages enumerated below shall apply to messages in each of such respective classes in addition to all
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S. No employee of the Company is authorized to vary the foregoing.
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NEWCOMB CARLTON. PRESIDENT

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Day Letters shall be written in plain English. Code language
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This Day Letter is received subject to the express understanding and agreement that the Company does not undertake that a Day




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Denver, Colorado,
March 26, 1917.

My dear Judge:

Thank you for yours of the 20th on the ma

r of the correspondence

with the Bank of France. This seems to strait: everythine out so far
as you and I are concerned and now we

1/11'4

t await,

117.! mistake about your telegram was due to my a

had received the final draft of

reakbion in Paris.
otion that you

and memorand u

which did not

reach you in fact until the fo
We have haa another fall

is again deferred.

They

t bore and, consequently, golf
sudden changes of

spring in this count

f those miserable,

raw March days suc

York.

Delano_ concerning

Treman, so will not

ry truly yours,

Federal
New York

BS/CC




serve Bank,

.

repeat.

the

drizzly,

I had a bully visit with

Best r

J. F. at1, Esc.,

weather in




Denver, Colorado,
March 29, 1917.

Dear

Judge:
drop look
I me

Thanks for the promise of a letter.

to you to

a line now and then, reporting the progress made by the upper circle in the
bank.

The cable to Cunliffe is surely all right PTO 1 hope we get a prompt

and satisfactory reply.

I had a bully visit with Delano.

He is all right, soun

on the various matters that we have discussed so frequently, and I think
will be an influence to prevent a narrowing down of policies in Washington,

but our little German friend finds it very difficult to keep his finger
out of the pie in the bank in New York.
in

I

have warned him to get himself

good trim against my return in June, when he

will find a very stubborn

and rebellious partner at the bank, prepared to have his own way a great
deal more than seems to have characterized the management of the bank
recently.

I may be a little over severe about Warburg's attitude, but recently
I must confess ho

has

jilted me pretty hard in the apnearance of a rather

unreasonable attitude towards the management of the bank in New York PnA we
have got to have it out sooner or later.
This morning I put in my first real attempt with some gold practice
with the professional.
which I am determined to conquer.

Everything went all right except my wo

After getting a drive going in perfect

shane from the tee with a good straight ball from 250 to a maximum of 280
yards, I smashed the head off the club, but with the irons, the professional

2.
llarch 29, 1917.

To - Mr. Curtis.

home and lick you.

I will go back
says that in a month he will guarantee
after the other without
perfect approach shots9 one right
I made eighteen

The result in
a miss, which is pretty good for me.
afternoon, I could lick my weight in wild eats.

that I feel so good this

all in a couple
Best regards to all the boys. I hope to see you
i

of months.




Faithfully yours,

J. F. Curtis, Esq.,

Federal Reserve Bank,
New York City.

BS/CC




Denver, Colorado,
April 3, 1917.

Dear Mx. Curtis:

Yours of :Jamb 30th reached me last evening ann, as you will
realize when you receive mg letter of April 2nd, the changes which
you suggest while different in language are identical in purpose
with those contained in my letter, so I have telegraphed you today
as per enclosed confirmation.

As to my remaining here any longer, it really is becoming
ridiculous.

When I az, able to play eighteen holes of golf every day,

have gained twenty-six lounds, for I now weigh nearly 156, and am
_
stronger and more vigorous than I have been in years, I feel very
much like a slacker.

This is impressed upon me all the more now

that I have one boy in a mobilization camp and another one straining

at the leash to get away - I have no doubt he will do so Whatever
I say, so it is time for me to get back home, as I have telegraphed.
Very sincerely yours,

J. F. Curtis, Laq.,
Federal Reserve Bank,
New York City.

BS/CC

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NEWCOMB CARLTON, PRESIDENT

Send the following telegram, subject to the terms
on back hereof, which are hereby agreed to

Denvor, Colorado,

April 3, 1917.

J. F. Curtis,

Federal Reserve Bank,

Now Yora City.

"onlying yours thirtioth hivesAready mailed lottor euasosting
almost idontioal ChanGos yen propose stop. Iu view of developments I

am strongly tempted to return at any rate for brief period so as to
exchande vlows as to our policy in New York and ,:4shington.

hew you and other° fool.
Benjamin StronL;.

Chg. Benj. Strong,

4100 Vontview Blv.




_:e1e6raph

ALL TELEGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING TERMS:
To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for comparison. For thi
one-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FOR AS SUC
in consideration whereof it is agreed between the sender of the telegram and this Company as follows:
The Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond the amount
received for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery, of any REPEATED telegram, beyond fifty times the n received
for sending the same, unless specially valued; nor in any case for delays arising from unavoidable interruption in the working of its lines; nor for errors in C. ,,er or obscure
telegrams.

In any event the Company shall not be liable for damages for any mistakes or delays in the transmission or delivery, or for the non-delivery, of this telegram, whether
caused by the negligence of its servants or otherwise, beyond the sum of FIFTY DOLLARS, at which amount this telegram is hereby valued, unless a greater value is stated in
writing hereon at the time the telegram is offered to the Company for transmission, and an additional sum paid or agreed to be paid based on such value equal to one-tenth of
one per cent. thereof.
The Company is hereby made the nc^nt of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to reach its
destination.
Telegrams will be delivered free within one-half mile of the Conipany's office in towns of 5,000 population or less, and within one mile of such office in other cities or
towns. Beyond these limits the Company does not undertake to make delivery, but will, without liability, at the sender's request, as his agent and at his expense, endeavor to
contract for him for such delivery at a. reasonable price.
No responsibility attaches to this Compaor concerning telegrams until the same are accepted at one of its transmitting offices; and if a telegram is sent to such office
by one of the Company's messengers, he acts for that purpose as the agent of the sender.
The Company will not be liable for damages or statutory penalties in any case where the claim is not presented in writing within sixty days after the telegram is
filed with the Company for transmission.
Special terms governing the transmission of messages under the classes of messages enumerated below shall apply to messages in each of such respective classes in addition to all
the foregoing terms.
No employee of the Company is authorized to vary the foregoing.

THE WESTERN UNION TELEGRAPH COMPANY
INCORPORATED

NEWCOMB CARLTON, PRESIDENT

CLASSES OF SERVICE
FAST DAY MESSAGES
A full-rate expedited service.
NIGHT M ESSAGES
Accepted up to 2.00 A.M. at reduced rates to be sent during the night

and delivered not earlier than the morning of the ensuing business day.
DAY LETTERS

A deferred day service at rates lower than the standard day message rates as follows: One and one-half times the standard Night
Letter rate for the transmission of 50 words or less and one-fifth of
the initial rate for each additional 10 words or less.

SPECIAL TERMS APPLYING TO DAY LETTERS:

In further consideration of the reduced rate for this special "Day
Letter" service, the following special terms in addition to those enumerated above are hereby agreed to:
Day Letters may be forwarded by the Telegraph Company as a
deferred service and the transmission and delivery of such Day Letters
is, in all respects, subordinate to the priority of transmission and
delivery of regular telegrams.
Day Letters shall be written in plain English. Code language
is not permissible.

c. This Day Letter may be delivered by the Telegraph Company
by telephoning the same to the addressee, and such delivery shall be a

complete discharge of the obligation of the Telegraph Company to

deliver.

This Day Letter is received subject to the express understandDigitized foragreement that the Company does not undertake that a Day
ing and FRASER
D.



Letter shall be delivered on the day of its date absolutely and at all
events; but that the Company's obligation in this respect is subject
to the condition that there shall remain sufficient time for the transmission and delivery of such Day Letter on the day of its date during
regular office hours, subject to the priority of the transmission of regular telegrams under the conditions named above.

No employee of the Company is authorized to vary the foregoing.

NIGHT LETTERS
Accepted up to 2.00 A.M. for delivery on the morning of the ensuing
business day, at rates still lower than standard night messKe rates, as
follows: The standard day rate for 10 words shall be charged fo'f the transmission of 50 words or less, and one-fifth of such standard day rate for 10
words shall be charged for each additional 10 words or less.
SPECIAL TERMS APPLYING TO NIGHT LETTERS:

In further consideration of the reduced rate for this special " Nirig
Letter" service, the following special terms in addition to those
enumerated above are hereby agreed to:

Night Letters may at the option of the Telegraph Company
be mailed at destination to the addressees, and the Company shall
be deemed to have discharged its obligation in such cases with respect

to delivery by mailing such Night Letters at destination, postage
prepaid.

Night Letters shall be written in plain English. Code language
is not permissible.
No employee of the Company is authorized to vary the foregoing.

Form 1217
CLASS OF SERVICE DESIRED

Letter

WESTEkaAA UNION

at Message

Night Letter
Patrons should mark an X opposite thy
of service desired:
OTHERWi4. THE TELEGRAM
WILL BE TRANSMITTED AS A
FAST DAY MESSAGE.

E

WESTERNUNION

'-st Day Message

Receiver's No.

Check

Ark

TEL

vqzift

AM

Time Filed

NEVVCoMB CARLTON, PRESIDENT

send the following telegram, subject to the terms
on back hereof, which are hereby agreed to

ramvor, Colorado,
April 49 1917.

J. F. Curti°,

Shoroham Rotol,
-:AlshinGten,T. C. -

complete confidonco as to
AGroe a1.thwisdom of taking governors into
vath
status of various foroign proposals stop. iio, must So impressod

confidential character of arranGements.
3on0amin Otroag.

Chg. Bonj. Strong,
4100 riontview.




ALL TELEGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING TERMS!
To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to th, originating office for comparison.
Cr this
one-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FOR AS SUCH
in consideration whereof it is agreed between the sender of the telegram and this Company as follows:
The Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond the amotur,
received for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery, of any REPEATED telegram, beyond fifty times the sum receive,
for sending the same, unless specially valued; nor in any case for delays arising from unavoidable interruption in the working of its lines; nor for errors in cip' w obscur,
telegrams.

In any event the Company shall not be liable for damages for any mistakes or delays in the transmission or delivery, or for the non-delivery, of this telegram, whethei
caused by the negligence of its servants or otherwise, beyond the sum of FIFTY DOLLARS, at which amount this telegram is hereby valued, unless a greater value is stated ir
writing hereon at the time the telegram is offered to the Company for transmission, and an additional sum paid or agreed to be paid based on such value equal to one-tenth o;
one per cent. thereof.
The Company is hereby made the rm.ent of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to reach it:
destination.
Telegrams will be delivered free within one-half mile of the Company's office in towns of 5,000 population or less, and within one mile of such office in other cities or
towns. Beyond these limits the Company does not undertake to make,delivery, but will, without liability, at the sender's request, as his agent and at his expense, endeavor to
^ contract for him for such delivery at a reasonable price.
No responsibility attaches to this Compa,iy concerning telegrams until the same are accepted at one of its transmitting offices; and if a telegram is sent to such office
by one of the Company's messengers, he acts for that purpose as the agent of the sender.
The Company will not be liable for damages or statutory penalties in any case where the claim is not presented in writing within sixty days after the telegram is
filed with the Company for transmission.
Special terms governing the transmission of messages under the classes of messages enumerated below shall apply to messages in each of such respective classes in addition to all
the foregoing terms.
No employee of the Company is authorized to vary the foregoing.

THE WESTERN UNION TELEGRAPH COMPANY
INCORPORATED

NEWCOMB CARLTON. PRESIDENT

CLASSES OF SERVICE
FAST DAY MESSAGES
A full-rate expedited service.
NIGHT MESSAGES
Accepted up to 2.00 A.M. at reduced rates to be sent during the night

and delivered not earlier than the morning of the ensuing business day.
DAY LETTERS

A deferred day service at rates lower than the standard day message rates as follows: One and one-half times the standard Night
Letter rate for the transmission of 50 words or less and one-fifth of
the initial rate for each additional 10 words or less.

SPECIAL TERMS APPLYING TO DAY LETTERS:

In further consideration of the reduced rate for this special "Day
Letter" service, the following special terms in addition to those enumerated above are hereby agreed to:
Day Letters may be forwarded by the Telegraph Company as a
deferred service and the transmission and delivery of such Day Letters
is,

in all respects, subordinate to the priority of transmission and

delivery of regular telegrams

Day Letters shall be written in plain English.

is not permissible.

Code language

c. This Day Letter may be delivered by the Telegraph Company
by telephoning the same to the addressee, and such delivery shall be a

complete discharge of the obligation of the Telegraph Company to
deliver.

This Day Letter is received subject to the express understanding and agreement that the Company does not undertake that a Day
D.




Letter shall be delivered on the day of its date absolutely and at all
events; but that the Company's obligation in this respect is subject
to the condition that there shall remain sufficient time for the transmission and delivery of such Day Letter on the day of its date during
regular office hours, subject to the priority of the transmissipn of II*
ular telegrams under the conditions named above.

No employee of the Company is authorized to vary the foregoing.

NIGHT LETTERS
Accepted up to 2.00 A.M. for delivery on the morning of the ensuing
business day, at rates still lower than standard night message rates, as
follows: The standard day rate for 10 words shall be charged for the transmission of 50 words or less, and one-fifth of such standard day rate for 10
words_ shall be charged for each additional 10 words or less.
SPECIAL TERMS APPLYING TO NIGHT LETTERS:

In further consideration of the reduced rate for this special "Nig,

Letter" service, the following special terms in addition to

tilt-

enumerated above are hereby agreed to:

Night Letters may at the option of the Telegraph Comp
be mailed at destination to the addressees, and the Company
be deemed to have discharged its obligation in such cases with re

to delivery by mailing such Night Letters at destination, pc
prepaid.

Night Letters shall be written in plain English. Code Ian
is not permissible.
No employee of the Company is authorized to vary the foregoigig.

4If




Form 1217
SIREO

WESTEklAaNA UNION
TEL1111! AM

ty Letter
Night Message

Night Letter
'Id mark an X oppoof service desired;
Wis.: "THE TELEGRAM
'E TRANSMITTED AS A

m

WESTERN UNION

Message

Receiver's No.

Check

Zw.ti 7riler

Time Filed

NEWCOMB CARLTON. PRESIDENT

rAST DAY MESSAGE.

;end the following telegram, subject to the terms
on back oereof, which are hereby agreed to

Denver, Colorado, hril 4, 1917.

J. P.

Hotel,
aohin6tan, D. C.
CurtiShoreham

Confidentially I am vory anxious If an ccumisnioners are sent abroad
to doca with financial 0.4ra3gements with allies to have a hand in the neLptiations
'0.t any rate so far as Reserve Barlii.s are concerned stop. Could you arrano to Bee

either Secretary or Governor Jhile iu ashington, explain that i contemplated a

:trio this year any way and fool very strongly that our relations vith proposed
correenondents London and Parte make it desirable If it can be arranued atop.

i can go at any tiLo 1:: ark; capacity desired and am perfectly able to do eo
without injury to health.
Chg, Benj. OtronG,
4100 Uontview.

Benjamin Strenc.




ALL TELEGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING TERMS
To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for comparison. For t1
one-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FOR AS SUC
in consideration whereof it is agreed between the sender of the telegram and this Company as follows:
The Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond the amour.
received for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery, of any REPEATED telegram, beyond fifty times the .:
,ceive
for sending the same, unless specially valued; nor in any case for delays arising from unavoidable interruption in the working of its lines; nor for errors in ciyiler or bbaen,
telegrams.
In any event the Company shall not be liable for damages for any mistakes or delays in the transmission or delivery, or for the non-delivery, of this telegram, whet"c
caused by the negligence of its servants or otherwise, beyond the sum of FIFTY DOLLARS, at which amount this telegram is hereby valued, unless a greater value is &tater! i
writing hereon at the time the telegram is offered to the Company for transmission, and an additional sum paid or agreed to be paid based on such value equal to one-lentil
.
one per cent. thereof.
The Company is hereby made the :moat of the sender, without liability, to forward this telegram over the lines of any other Company when necessary, to roach it
destination-.
Telegrams will be delivered free within one-half mile of the Company's office in towns of 5,000 population or less, and within one mile of such office in otAcr.cities
i towns. Beyond these limits the Company does not undertake to make delivery, but will, without liability, at the sender's request, as his agent and at his expense, endeavor t
contract for him for such delivery at a reasonable price.
No responsibility attaches to this Compa:ly concerning telegrams until the same are accepted at one of its transmitting offices: and if a telegram is sent to such offic
by one of the Company's messengers, he acts for that purpose as the agent of the sender.
The Company will not be liable for damages or statutory penalties in any case where the claim is not presented in writing within sixty days after the teaegta`m i
Sled with the Company for transmission.
.

Special terms governing the transmission of messages under the classes of messages enumerated below shall apply to messages in each of such respective classes in addition toin:
the foregoing terms.
S. No employee of the Company is authorized to vary the foregoing.
THE WESTERN UNION TELEGRAPH COM PAW
INCORPORATED

NEWCOMB OARLTON. PRESIDENT

CLASSES OF SERVICE
FAST DAY MESSAGES
A full-rate expedited service.
NIGHT MESSAGES
Accepted up to 2.00 A.M. at reduced rates to be sent during the night

and delivered not earlier than the morning of the ensuing business day.
DAY LETTERS

deferred day service at rates lower than the standard day message rates as follows: One and one-half times the standard Night
Letter rate for the transmission of 50 words or less and one-fifth of
the initial rate for each additional 10 words or less.

IA
-

SPECIAL TERMS APPLYING TO DAY LETTERS:

In further consideration of the reduced rate for this special "Day
Letter" service, the following special terms in- addition to those enu-

-

Letter shall be delivered on the day of its date absolutely and ate 4.1
events; but that the Company's obligation in this respect isSubj,ee
to the condition that there shall remain sufficient time for the ,traa.
mission and delivery of such Day Letter on the dayofits -date (Liv.U)
regular office hours, subject to the priority of the transmission of
ular telegrams under the conditions named above.

No employee of the Company is authorized to vary the foregoing.

NIGHT LETTERS
Accepted up to 2.00 A.M. for delivery on the morning of the ensin
business day, at rates still lower than standard night message rates,
follows: The standard day rate for 10 words shall be charged for the t ra"
mission of 50 words or less, and one-fifth of such standard day rate for
words_ shall be charged for each additional 10 words or less.

merated 'above are hereby agreed to:

A. Day Letters may be forwarded by the Telegraph Company as a
deferred service and the transmission and delivery of such Day Letters
is, in all respects, subordinate to the priority of transmission and

,.

I

' delivery of regular telegrams.
-

B

Day Letters shall be written in plain English. Code language

is not permissible.

c. This Day Letter may be delivered by the Telegraph Company
by telephoning the same to the addressee, and such delivery shall be a

complete discharge of the obligation of the Telegraph Company to
deliver.

This Day Letter is received subject to the express understanding and agreement that the Company does not undertake that a Day
D.

SPECIAL TERMS APPLYING TO NIGHT LETTERS:

In further consideration of the reduced rate for this special "Ni
Letter" service, the following special terms in addition to tit(
enumerated above are hereby agreed to:

Night Letters may at the option of the Telegraph Cornpa
be mailed at destination to the addressees, and the Company
be deemed to have discharged its obligation in such cases with resr

to delivery by mailing such Night Letters at destination, po.
prepaid.

Night Letters shall be written in plain English. Code
is not permissible.
No employee of the Company is authorized to vary the foregoi

(e7

Denver, Colorado,

April 4, 1917.
COFNIDMITIAL.

L77r 11,1,1(7.

Dear Judge:
LAY

mmig

141,-

Yours of the 30th is just received; also the various enclosures.

iKAIS K

VtrW1Rtt
I am telegraphingvim today as per enclosed copies.
.

The foreign arrangements must, of course, be submitted to the

Governors at this meeting and I hope the program for handling the account
as 1 roughly outlined it some months ago will also be submitted.
About the 2,,; certificates of indebtedness,

agree entirely with

the attitude of the Board as to the way this matter was handled by the

Secretary,

but 1 think had I been there i might have recommended that no

resolution be prepared, at any rate in exactly the form as finally

drafted.

..Personally, I would like to have talked this over with EicAdoo to get his

point of view before taking action.

In the first

place, he is wider great

pressure and in the second Place I think he is not very well posted on

transactions of this Character and possibly has not had time to get information from those who might be of assistance to him.
The British Government borrows immense sums of money even In times

of peace on short bills of various

kinds.

Sometimes these are placed in the

market on tenders, in fact i VhilIK that is the usual procedure.

Announce-

ment is made by the Bank of England that they will receive tenders for so
many millions at 30 days, so many at 90 days, so many at 6 months.

Bids are

made on the basis of a rate of discount and allotments are made by the
england to the bidders, acdording to the rates bid..

rowing conducted by



Bank of

The other type of bor-

the British Government is directly from the Bank of England.

2.

April 4, 1917.

To-* Ur. Curtis.

This is an operation that is constantly taking place and instead of re....

quiring in each instance a protracted negotiation by custom the ,kwernmaat

always pays the Bank of Isagland 1/2 of 1'4 less than tho bank's minimum

discount rate. Our minimum aiscount rate is 4 our maximum Oa consequently
our arrangement would be 1/2 of 1:i bolas the mean rate. The mean rate being

as the rate for bills

3, would make the rate on those borrowings 2-l/2'
I

is uniform with all Aeserve banks, it would applyoxivally to each lender.

I am writing 1.2r. Jay a letter on the subject of Government

borrowings and

enclose a snare copy of this paragraph of my letter to you which you might
hand him.

The real complaint which can be made about the Secretary's course

is net so much the rate, which was 1/2 of 14 too low, but rather the fact

411.

that he went ahoad and established a rate and fixed the terms without con-

sulting the lenders at all. This should not be allowed to haupen again.
(

Now as to mg separate telegram addressed to you at ;.ashine,ton about

foreign negotiations, I do not like to butt in on the Dreasury Departments
plans, portioularly when it involves what might appear to be an egotistical
assumotion of the ability to do something which licAdoo may not be ready to
accept. The fact is, however, that Iry ,ping to London. and Paris just when I

did a year ago - that is during the pressure at Verdun - at a time when
things really looked very black, and proposing financial arrangements to the
Bank of Enaland and the Bark of France, as well as the part which by chance
I was obis to take in the Rsglish-Prench

negotiations here when Lord Reading

came over, would I believe give me a splendid opportunity to do some good work

over there on the most fsvored nation basis. You can




imagine how

keen I am

3.

April 4, 1917.

To - Mr. Curtis.

to get at it, Particularly as all of these international loans in which our
government is interested

Should be handled, so far as banking arrangements

are concerned, through the Bank of England and the Bank of Prance abroad pnd

the Federal Reserve Banks in this

country.

some suegestion along this line had not

I was

rather disapnointed

that

been made in connection with the

Danish transaction, where we could have been of servide I think.
I am writing confidentially to Fred Delano on this subject, but to
no one else.
it.

If you can get something

started.

I would greatly

appreciate

3o far as health is concerned, the trip would do me good rather than

harm and Dr. Sewall would certainly not object.
All of these recent developments emphasize the necessity for con..

eluding our gold arrangements with the Treasury and the sooner, the better.
Many thanks for your letter.

Please keen me posted.
Faithfully yours,

J. P. Curtis, Esq.,
Federal Reserve Sank,
New York City.

BS/CC




VcAL




Denver, Colorado,

April 4, 1917.

I conratulate Iarburg

Thank you for your note and the clipping.

upon his broadminded attitude in arranging for the appointment of the
Bank of England and the Bank of rance as our correspondents.

I am glad to hoar

that

they are after Buchanan et al, but do not

recall that we had any signed Minutes

you refer

to

the

bearing on

Very sincerely

J. V. Curtis, Esq.,

Federal Reserve Bank,

BS/CC

Possibly

docrimpnt in Which they charged us with all sorts of

outrageous things. I will be ,lad to hear how

New York City.

the matter.

the matter turns out.

yours,




Denver, Colorado,
April 6, 1917.

iy dear Judge:

Just a line to exchange mutual felicitations and congratulations
,hat the time has at last arrived Where you and I can both look a German
in the eye and call him a savage.

I suppose your blood is at fever heat

and that you are expecting to go off in an aeroplane or with a mosquito
fleet, or something of that sort, but, frankly, you have no right to do
it, when there are millions of young fellows without families, who have

no obligations

of the character you have to disolinarge in the line of your

present work.

Ben is with his regiment at Trenton for the moment, but will

probably be shipped off

somewhere before ver7 long.

Delano, asking him to investigate what is

I have written Fred

necessary to be done to

have

him transferred to some special training corps so as to get a commission.
He is bright and capable and aould make a good Lieutenant.
any suggestions. I would
Guard about

E

and besides

that has

like

to hear them.

Ben enlisted in the

National

year ago and has had that much training with his Company
taken the military course at Princeton.

should be

Isn't it ridiaulous, inconsistent and intolerable that I
fooling my time away out here, olaying golf

Ben is training

to get himself in

and going to pink

shape to get shot.

teas, when

I am well

enough to

go home and should be home, and the only thing that has restrained me so
far

has been

the fear that you and the others will get up on your hind

legs and bark at me until I was shamed into a condition of complete irresponsibility, but you are going to

see me back

before

very

long, unless

2.

April 6, 1917.

To - Mr. Curtis.
I am mistaken.

I hope you understood my telegram to Washington. It aould be a

calamity if some political commission was sent to Europe just now to

loo u aftor financial arrangements over there, when it ought to be done,
at least to a large extent, through the _Reserve BanMI System. Those

people over there after the Anglo-French loan negotiations, and largely

as a result of my trip, are all very warm friends of mine and I certainly don't want to miss the opportunity of availinb of the relationship.
This is the time for us to get in some grand licks in the matter
of our organization and I hope you do it soon.

Best regards to you all.
Faithfully yours,

J. F. Curtis, Esq.,

Federal Reserve Bank,
New York City, N. Y.

411




BS/CC




Denver, Colorado,
April 9, 1917.

Dear Mr. Curtis:

Yours of the 3d, enclosing copy of the letter sent to the
Banco de la Nacion Argentina, is just received.
of the letter to make nor,

in

I have no criticism

fact, does paragraph 4 appear particu-

larly dangerous as to the interests of the member banks, so long as
we don't act under it.
buy bills or we are not going to.

As i wrote Warburg, we are either _

If we buy them, we compete with

our members; if we don't buy them, we don't compete.

Business is now

moving smoothly down there and rates are i understand fair and this
paragraph 4 would doubtless be construed as being for use only in
emergency or When rates and conditions made it difficult for our
member banks to handle the business.
The President's message was certainly a corker.

I only wish we

had started our work of preparation earlier because I believe from all
.

hear out here that there is no possibility of our giving any military

assistance to the allies in less than a year.

On the o

President's patience during the past two years has not put him in an
unasailable position and the best evidence of this is the freedom with
which Congress is granting him extraordinary powers.
I sent a brief cable to Cunliffe and Pallain, with greetings, just
as soon as Congress passed the joint resolution, and their replies are
as follows:




2.

To

April 9, 1917.

iJr. Curtis.

"Warmest thanks and a hearty welcome to our splendid new ally
(Sg.) Ounliffe."
whose cooperation !nsans much to us.
"Profondement Touche de votre message mous ezprime notre
joie de voir L'unatie seculaire qui lie les etatsunis et la france
aboutir a une c000sration devant assurer le triomphe de notro
commun ideal de justice et de liberte stop. Veuiliez croire a
men ,ien cordial attachment et aux voeus sinceres que je forme
(Bg.) Georges Pallain".
pour vous.
Best regards.

Faithfully yours,

J. F. Curtis. Esq.,
?sclera! Resofve

New York City.

BS/CC




Denver, Colorado,
April 9, 1917.

Dear Judge:

Thank you for your telegram

from Uashington and for having a word

with Secretary McAdoo on the subject of my wire.

About a bond issue of possibly several billions, Mr. Jay spoke
of a possible bond issue when he telephoned me the other night, but I did
not gather from what he said that it would be

of any

such proportions. But

the letter I sent him was very hastily written and in view of your telegram,
should be revised.

If Secretary McAdoo contemplates a bond issue of some billions, I

hope that he and his associates will realize that there will be a good many

difficulties to

overcome in handling such a loan at anything like the rates

of interest which have heretofore Prevailed on our Government loans and,

particularly, the absence of the patriotic enthusiasm throughout the

country

generally, which has made it possible for England and France to place huge
loans during the past two years.

I feel very strongly that the cost of this war should be largely
paid out of taxes and as such taxes cannot be collected under a period of
some months or a year, that a considerable part of the borrowing should
in the meantime be in the form of short notes of the Government, to be paid
off out of taxes as collected.
of finance.

That I think should be the general scheme

The country is rich enough to pay a considerable part, if not

all, of our participation in the war out of taxes and avoid piling up a
big funded debt, except to the extent that we lend money to our allies.




2.

April 9, 1917.

To - Lir. Curtis.

As to such bonds as are issued,

1107

idea is that they should be

generally of the following character:
They should not
from the surtax.

be exempt from

income tax, or at any rate

Issues of Government bonds that are free of taxation

have the effect of creating a preferred class of wealthy people who
escape the payment of taxation and besides that it puts the Government
in position of entering into obligations with its bond holders, to
violate Which would be no less than repudiation.

England has avoided

this mistake and France has likewise, to a great extent.

We should pay

the higher rate of interest and collect income tax on bonds.
suppose our friends at

Washington will

I do not

agree to this.

Bonds issues should be convertible into subsequent issues,
Which might be made at higher rates of interest.

They should have either early maturity, say five or ten
3ars, or possibly a somewhat longer maturity, the Government reserving
the right to redeem them at par at the end of five or ten years.
There should be no currency privilege

attached

to the

Janda.

Sinking fund provisions for new issues, as well as for those

now outstanding, should be incorporated in the statute authorizing bond
issues at this time, and my idea would be to have the sinking dund ap-

plied to making purchases of bonds in the open market, rather than towards
redeeming them at par by drawings.

The rate of interest will, of course, depend upon the




3.

To - Mr. Curtis.

April 9, 1917.

length of time the bonds have to run and Whether they are to be tax
exempt or not.

Of course, 3-1/2;. is

the lowest possible rate at which

a tax exempt bond could be sold and when

one considers the sale of

some billions, it would be out of the question to market them at any
such rate, in my opinion.

England made a

bond issues in fixing too low a rate of interest.

issue a bond at

first

serious mistake in her

Our Government should

par, fixing an interest rate Which will result in the

bonds commanding a premium at once.

Subsequent financing will then be

made much easier, and ever-' experienced bond man will agree as to the

wisdom of

insuring the premium on an issue

with the optimism and en-

thusiasm that goes with it.

Something, it seems

So much for the terms of the bonds.

should be done to take care of the old 2's.
3-1/2%, or possibly in time a

unfortunate to have the
think that

the

0,

to

me,

If the Government issues a

bond for war purposes, it will be most

2's decline to corresponding

levels and I

National Banks should be given the privilege of exchanging

the 2's Which carry the currency provision for the new bonds without the
currency provision, under some restriction Which will not effect a contraction of bank note currency too rapidly.

This would not be difficult

to bring about and in justice to the National banks should be done.
I am also of the opinion that the position of the

Reserve banks as

purchasers of large amounts of the 2's for conversion, should also be carefully safe-guarded.

It would be a great deal better for the country, as a

whole, if these matters are dealt with promptly and in a broad-minded way,
than to have a lot of patch-work applied as we go along.
as well as the National Banks, should be

absolutely

The Reserve banks,

protected against loss

4.
April 9, 1917.

To - Mr. Curtis.

through a possible decline in Government bonds.

When it comes to marketing an issue of some billions, if the loan
is to be successful it must be

handled

with a great deal of skill and

must be preceded by an educational campaign of huge proportions.

Other-

wise, I would expect to see the loan fail just thvouda inertia and indifference on the part of people generally Who have no such enthusiasm as

will be stirred up if there is actnnl fighting going on in the country or
on our border.

Assuming that an attractive

it should be possible to organize the
if necessary, with

interest

country

into twelve districts, more

a view to having subscriptions

made through the National,

State and Private bankers and bond houses, through
Post Offices and Sub-Treasuries.

rate is authorized,

the

Federal Reserve Banks,

To stir up the necessar; enthusiasm and

educate the public, I should think that all of the responsible bond houses
of the country should be organized to conduct a campaign.
r---




should be

purchased by

vestors can

investors and not by the banks.

be made accessible

to

These bonds

And if private in-

the Government through the data, invest-

ment lists, etc., of the bond houses, it might be well to suggest the development of an

organization through the

various Federal

Reserve

districts.

formation of committees in the

This selling organisation

in

each

district would, of course, Pe expected to tabulate all the insurance com-

panies, trust companies, savings banks and similar institutions, with a
view, if possible, to making preliminary sales in large blocks; that is the
best advertising of a bond issue that can be made.
The proceeds of the offering of a

large bond

issue could not be paid

into the Government or to the Reserve Banks, without great disturbance to




5.

e - Mr.

April 9, 1917.

Curtis.

money conditions, unless distributed over

quite

a period.

The way to

handle that is not simply by having the subscriptions payable in installments, but by deferring the nayment for as long a period as possible.

Meantime the Government

of which correspond
pauable.

borrowing money on short notes, the maturities

with the dates on

which the bond subscriptions are

In that way, one hand will wash the other and disturbance

to the

money market is avoided.

Of course the proceeds should be paid to the

Federal Reserve Banks end

it would be desirable, if possible, to have

the

payments made through the member banks principally, as the Reserve banks

could then finance such payments by discounting paper, if

needed.

Having

subscriptionsand payments handled throughout t'le country by districts would
result in a minimum disturbance,

Distsict and be available

each Federal Reserve

until checked out by the
exercise

to the banks of that district

Government and, of course, the Government would

care to see that funds

were disbursed,

because the proceeds would stay within

to as great

It seems to' me highly

in the respective Federal Reserve Districts

extent as

possible, in

important that the proceeds of any loans made

to the allied powers should be handled through the
with our arrangements so nearly completed with

should be no

Bank of France, there
ment in arranging

Reserve banks.

the Bank of Lngland

that a foreign loan should be handled

and the

in that nay.

the only safe way in which huge

Government loans can be placed in this country
market,

Surely,

hesitation on the part of the Govern-

I am strongly of the opinion that

to the money

those distructs.

just now, without disturbance

will be by the temporary use of short borrowings, to

which I have referred above.

3,

6, 9 & 12 months' bills should be

authorized




6.

April 9, 1917.

To - Mr. Curtiss,

and sold from day to day as the Government needs money.

They can then

be -.laid off out of taxes Alen they _come in and out of the proceeds of sales
of long time bonds when made, and the adjustment becomes very largely one
of bookkeeping.

I do hope McAdoo realizes this because failure to regard

this point as of controlling importance might result i

such serious money

disturbances as to defeat the whole financial program.

will be glad to have any
about this matter.

further particulars

Meantime, hope the above rough suggestions may

some points of interest.

Very

F

Curtis, Fee.,

Federal Reserve Bank,
New York City.

BS/6C

N.

that you can get

sincerely yours,

present

Denver, Colorado,
April 10, 1917.

Dear Judge:

Your letter from 1718 H. Street has just come and I have read it
with deep interest.

I am glad you had opportunity to convey my message to

McAdoo, as I feel so thoroughly helpless just now that I look on myself as

a slacker.
About the big bond issue I will make the following comments

on your

remarks aria the memorandum you send:

It would be a fatal mistake to

invite tenders for such an issue

of bonds. The Government

should fix the rate and make it sufficiently at-

tractive so that the issue

would be over subscribed at once and sell at-a

the lists were closed. The experience abroad should be sufficient to demonstrate this, particularly in England.
,remium before

is the very lowest ratecould be
at Which the bonds

3-1/2

placed and I have some doubt of a ver7 large issue

goiug

at that rate.

Certainly it would not if the war situation and enthusiasm were allowed to
cool.

Possible We belong to that class of stupid

nations that

require

education by expensive experience before learning and, if so, the people
on Capitol Hill have the power to indulge themselves in that luxury.

agree that 500,000,000 a)uld be sold

at 3-1/2, possibly even a billion,

but much beyond that I think very doubtful.
It would be a

fatal

blunder to accumulate

Government loan like this in depositaries in




the proceeds of a

huge

advance of disbursement. Of

2.

Amril 10, 1917.

To - Mr. Curtis.

course the turn over will be immense any way and, if the Reserve banks
are the only direct fiscal agents of the Government, they will need to

exercise a good deal of skill and should have wide discretion in appointing
sub-depositaries.

The employment of Short loans, as the British Govern-

ment has done, is a skillful way of handling such transactions because it

contraction.

mitigates the evil of expansion and
With some reservations,

I

ah

deposits of the proceeds to the extent
members of the Federal Reserve

System.

inclined to the view that special

necessary should only be made with
I have hesitated to say this posi-

tively because we are in a national emergency where discrimination of that

sort should be avoided but,
Government funds with
time of war.

State

after all a l;tderal law autherizing deposits of

banks is a pretty radical proposal, even in

Possibly the best plan would be to have either the Reserve

banks or the Secretary of the Treasury in position to

exercise discretion

in that matter, as it seems Impossible to forecast what the

requirements of

the situation miijit be from time to time.

A memorandum of Mr. Kenzel's report on ineuiries among certain

bankers

indicated to me. that the selection of those of Whom inquiry was

made had been rather hastily

tions Which 1

considered. I have sent Mr.

Ja.y some sugges-

hone he will regard and possibly these imiuiries mi-tt be made

very quietly through Important member banks in the other large cities of the
State.

I sympathize with McAdoo's difficulties as

to the

But certainly we should have no difficulty in getting any
desires




from

New York bankers, including Jack Morgans.

money

trust, etc.

opinions that he

a.
To - Mx. Curtis.

O.

April 10, 1917.

I am personally strongly of the view that the cost of the

war

should be paid largely out of taxes, but I think these taxes should be
equitably distributed and am delighted to observe that ILICAdoo's mind is
running toward a considerable reduction of the exemption figure in

the

income tax.
7.

McAdoo is absolutely right in stating that this is going to

be a difficult and delicate situation to handle.

I do

hope that political

considerations are eliminated and sound business judgment is used to decourse
termine that thOccet shall be. Most important of all, the first loan
must be a suecess.

As to personal mttters.

little cold

during

the

I au getting along ell right, except for a

last fey, days and I am no more restless than the

situation and my own circumstances

justify.

Of course I want to see Ben

who is with his segiment, but for the present at any rate have abandoned

any thought of returning before June and even then I exnect to give you a
splendid exhibition of shirking the heavy work.
About your own plans.

It is so exceedingly important that the bank

should not be crippled that I do hone you are not tempted into soLle war

acti-

vities, which would really be of less importance to the country than your
work at the bank.

If we can see our part of the job successful*

conductod,

our consciences will be satisfied, even though there will be no spectacular

stuff about it

and no glory.

Besides that, you and I are too old for military

duty end we should admit it. Many thanks for your letter
Sincerely yours,
Y. Curtis, Esq.,
Pederal Reserve Bank,
New York City.
J




and for all the news.

Denver, Colorado,
April 16, 1917.

Dear Judge:

I have yours of the 9th, enclosing copy of your letter to Secretary
McAdoo, which strikes me as excellent.

My view about tqlaltion on Government

bonds you understand and, frankly, I do not

think

the gentlemen wia.: attended

that meeting have thought enough about it or investigated the subject thoroughly enough to see the force of my own position, which really is unanswerable in the case of a country like Eagland or France.

Commenting by

paragraphs:

Just about my views, except for taxation.
I thoroughly agree.
Ditto.
Ditto.
Ditto.
Ditto.

With this paragraph I do not agree.
at one stroke

is

too heavy.

A billion dollar transfer

I am enclosing copy of a letter just written

to Aiken at his request which refers to this matter and I will not repeat.
See also Aiken's letter.
You will observe that on the whole and with the exceptions stated,
we are in almost absolute agreement.

In handling this matter I suggest correspondence, etc., be entirely
in one man's hands.

It seems to be yours at the moment and I hope you con-

tinue to look after it.

Many thanks for keeping me posted.
Very sincerely yours,

J. F. Curtis, Esq.,
Federal Reserve Bank,
New York City.




Dnver, Colorado,
April 16, 191Y.

Dear Judge:

I am grateful to you for your nice, long, personal letter of the
12th.

The book "The Fireecial Administration of Great Britain" has reached

me and I have just started reading it.

Will write you later of any im-

pressions I gather and sand a copy to Jerome Greene,

I suggest your urging

Jay to see that Ex. Schiff is consulted in these Government bond matters.
It will come back from Jashington, of course, through Warburg if he is not
and it is important that his views be obtained.
I don't agree with you about only

subsequent purchases of 3's by

Reserve banks being convertible.
logical as to

but don't

both

At first glance that would see

Reserve banks and National banks that hold the 2's,

forget that

the most important consideration to the Government

during war times is to preserve unimpaired the economic strength of the
country, because the country's business pays

the taxes

going normally and without shock, at any cost.

and it must be kept

The ownership of over

$700,000,000 of P's by the National banks is a menace to the economic
stability of the Government if by chance their value should be reduced
comearably to the reduction in the value of British consols.
I think that within reasonable

limits the

Therefore,

National banks should be protected.

About the Vanderlip dinner - I would like to have seen the Reserve
bank move first in that matter, particularly as

it was our own suggestion,

made over a year ago, to have those meetings with the Clearing House.
hope it is arranged to

have

them at our own office.

hope, realize that a bank like ours




I

Mr. Saunders will, I

cannot be run from Washington.

2/

To - Mr. Curtis.

April 16, 1917.

My letter to Aiken covers the ground about this matter of depositing money with State banks.

50 years in order

to get

It is a close point and we must go back over

banks

precedent for Government deposits with State

and then, if you investigate the record of those days, you will find it
filled with some of the most scandalous chanters

in

the Government's finan-

cial history.

I wrote Mr. Treman some time ago about bills bearing German names,
particularly South American.

That is a good subject to put in the hands

of our new Credit man for investigation.
As to the

duration

of the war, tell Dr. Carrel to stick to his last;

the war will be over this year unless I am mistaken very greatly in my estimate of German canacity to see the hand writing on the wall.

The only

possibility of its lasting two or three years longer is as a result of
Russia making a separate peace, which would be a disaster.
1 hope you don't enlist, or to put it differently - that you are

not allowed to enlist and for the latter hone I rely partly upon Laura and

partly upon the

enlightened common sense of the

rely upon you with

Government.

I wish I

could

equal assurance, but you are a bloodthirsty chap and I

know hanker to kill some Germans.

Glad to hear the drills, etc., are working

all right. 1 suggest

that our organization be built up now rather than later when pressure is on.
AeA. the boys to consider what shape we are in to handle 4500,000 or 41,000,000

subscription




to a

bond issue, in case we should be asked to do so.

April 16, 1917.

To - Mr. Curtis.

am still hanging on here by mu eye-lids. Have just returned

from a four or five days' outing with some friends and devote today to
cleaning up accumulated mails.

Faithfully yours,

J. F. Curtis, Esq.,

Federal Reserve Bank,
New York: City.

BS/CC







Denver, Colorado,

April 17, 1917.
Dear Ur. Curtis:

Thank you for yours or the 12th, with various enclosures.

In order to preserve a good chronological record of the various
steps of our Aiglish arrangement, I suggest that Miss Par12r be cmked

to Prepare a file of various letter and memoranda, to be bound up

carefully and put in the archives.
Of course I shall return to New York to see Lord C/2nliffe

he is in this country and await word as to his plans before making my
own.

In reading over the .'ress statenent, 1 am strUke with the fact

that it appears to be e bit cold. Possibly that cannet be avoided without going into more detail than we feel justified In doint. I an sorry
that it was not brought out a little more clearly that the negotiations
for this arrangement wore undertaken a year ago, as the,t -eould help sot
straight the unfOrtunate announcement about ñi1.ch we complained.

Please koep me advised of Lord Cunliffe's nlans tnd mdvomente.

Best regards.

Faithfully yours,

J. F. Curtis, Deg.,

Federal Reserve Bans:,
New Yoric City.




Denver, Colorado,

April 18, 1917.

Dear Judge:

The enclosed correspondence and copy of my letter to Captain
Logan all explain themselves.
Will you do whatever the needful may be?

Very sincerely yours,

J. F. Curtis, Nsq.,'r

Federal Reserve Bank,
New York City, N. Y.

Ns:\
88/00
.DICS




Denver, Colorado,

April 22, 1917.

Dear Judge:

Thanks for yours of the 17th, enclosing copy of Minutes of
the tenth Conference of Governors.

Very sincerely yours,

J. F. Curtis, Esq.,

Federal Reserve Bank,
New York City.

BS/CC

U.

J NIONTVIEW BOULEVARD




DENVER, COLO.

Denver, Colorado,
May 18, 1917.
CONFIDELITI AL.

Dear Mr. Curtis:

Enclosed is the statement handed to me by Mx. Seymour, out-

lining the procedure which has been devised for supervising foreign
exchange transactions in London.

I have read this carefully and

suggest now that you add it to the file of papers on this subject,

making sure that it is not accessible in the office, as it was
handed to me in great confidence.
The memorandum I left with you covers all the suggestions that
occurred to me at the time and I now further suggest that you keep
posted on the progress of the legislation in Washington relating to
this matter.

Meantime communicate with Er. Prank Polk of the State

Department to ascertain their wishes, etc.
There is no doubt of the advisability of starting something as
soon as possible.

It should center in New York and be under the super-

vision of the Reserve Bank.
Very sincerely yours,

J. F. Curtis, Esq.,
Federal Reserve Bank,
New York City.
BS/CC

Bac.

oatfa,

9ixt."1.5
/r

tr

it&c.




Denver, Colorado,
May 22, 1917.

Lear Judge:

I have been over the diagram of the Liberty Loan organization
idth great interest and it looks to me very good indeed. So good in fact
that the only suggestions I can make are of quite minor importance.
Tor one thing, I see no provision for a woman's organization, no evidence
of an official connection vitt the organization of the American Bankers

Association, no provision for organizing children in the work of selling
bonds, particularly school children, and What possibly is more important
than any of these - no provision as to permanent organization, which
would naturally come along later any way.

shall be

I am returning the chart as I

returning myself in a few days and but forward these modest sug-

aations for you and

jr.L Jay to consider.

Very sincerely yours,

J. F. Curtis, Deg.,
Federal Reserve Bank,
Nev York City.

BS/CC




Denver, Colorado,

July 23, 1917.
Dear Judge:
Many thanks for yours

n Dr. Pratt - possibly it
was suppressed at the

me.

ico.
am gr

por legislat

to send copi

of the 16th. 00 telegram has

,

d and disappointed that
this matter of
.g trade with the enemy is not,
appar-

t should be. Light it not
be dole if you please, or at my request,

, in this matter to. Polk,
tell them that you are
submitiO.ng the mat or to
rtments in the belief
that it is of suffioi
uportan. be a1t with in the
pending bill introduced by 1,1r. Adamson,
rn if they deem it
desirable, I will be very glad to meet wi
licAdoo, Dr.

the departments-on my return east,
ington on the 15th of August.

as I

oct to be in Wash-

in the meantime the proposed

amendment might be polished
up by 1noluding any ideas that
Jir.. Kent has.
am enclosing a letter which
might bO sent to Lord
Oanliffe (first page to be re-written
on the Bank letterhead).
Please as7,z. Mr. Jaw and Lr. 2raman
to show you my letters of
today on other matters. A heavy
mail today makes this brief.
With my

best to you all,

Yours very truly,




Denver, Colorado,

July 26, 1917.

age:
Thank yet

or yours of the 21st. I will start sitym-

those letter at once and return them when finished.
The Chang

is all right
approval in Whington and

that sort of o&a1izod

authority in the Federal 2opervo
oral Reserve Banks I presume
these matters must not require

a ioi)t not be delayed by
o Wy.

business is done in
the delay of constant

Now York, action is require
reference tu
ld be i
Be-aes that, it is
a matter which 4b.ou1d be dealt with ur.der ti general authority

ef the Secretary of the '2reasury rather tha thc
e Board..
Best regards to you and many t
r following up
this matter.
Sincerely yours,

J. P. Curtis, Eng"

Federal Resurve Bank,
New York City.
BIVCC

Denver, Colorado,

July 51, 1917.

Dear Judge:

-

Thank you lo:c yours of the 27th. This reply may not
reach
Iderstand you aro headed for a holiday, which
do1flt3 me exec) lgly.
The only 'Iticism I have of the proposed amendment
to

will
supervision of
tanco.

It io

--lemy Bill" is the possibility that it
d attempting too great a detailed
h are being conducted at a dieto have the authority,

but much depends

the legislation g000
much red tape and regulati

is exercied. After
to maL

pate altogether too
k :actieal and

simple,

You ask' what I think of the war situ ion. T. me it
looks very bad indeed. I 300 no hope of an
concluzion of the
war and a possibility of cone breakdown
he meantime, and possibly before we are prepared to put our leight under the load. I
wish our various complicatod organizations for conducting the war
could be centralized, consolidated and more authority nut in one
head man. --

Incidentally, it appears to me that all of the suggestions
mhich-were .diseudsed at that meeting at ilagnolin are being gradu-

ally Dutinto effect, with the exception of the International

Council, Which to my mind io the most important of all. Best rehttp://fraser.stlouisfed.org/
gOeds to yen and Laura.
Federal Reserve Bank of St. Louis




November 1S, 1917.

Mr. J. F. Curtis

';UNii DEA

Federal Reserve Bunk
rew York City.

'Jo.,

Dear Mr. Curtis:

-.

I have yours of the 7th enclosing Chan'I.
Clark clippings and will shortly mail you copy of my
reply to his letter, tofrether with his. Mich
for the office news.
Replying to yours of the 9th in regard to
the foteign trade banks, my opinion is thtlt they should
-,-be-gVen the rate established for the acoeptanees of mem71er banks, the reasons being as follows:

First, they are, in fact, organized for

the purrose of enabling member banks, through a separate
corporation, to do a type of business coliewtively which
they are not able to do individually and shou.10. not be

discriminated against in rates.
Second, there is no competitive situation
to deal with referentially as between member and nonmember banks.

Third, in general, they are established

for the purpose of developing a business where favorable
rates should be a part of the plan of,encouragoment.
Contr1;;-,

Fourth, their timulremette with the restric-

tions imposed by the Reserve Board should be considered as
equivalent to membership.




Er. J. P. Curtis
I told Mr. Xonzel that that was in general
my view and asked him to have the question submitted
through you to the Committee or the Board. and I hope
very mAch that the Board will accept this view, making
It apply to the Mercantile Bank, the American Foreign
Banking Cor,)eration and the International Banking Corporation.
AsILso suggest to our Board that if we 00
not favor those institutions with the best rate they
will be at a disadvantage in competing with foreign

banks which have agencies in Lew York.
au hupIng to see you and the family down
hol.o
Lot me know what the prospect 113*

With best regards,
Vory sincerely. yours

Woods Hole, Mase.,
August 12, 1918.

Dear Jim:

I was glad to gat yours of the 9th.

to get anything like a decent report from you,

I wen

It took three telegrame

or

Jay,

or anybody and

in a great rage about it until your letter oasts.
Of course it

soldier idea.

it+
perfectly obvious that there is nothing in the

It is also perfectly obvious that there is nothing serious

the matter with you, and equally obvious that what you need is just what

the doctor orders, 66M8 rest and recreation and fresh air.
will try and run up to Manchester while you are tners, but
to

had to abandon the trip with Charley Norton because I have too much
do here.

I do not believe that Mr. Beyer would fill the bill in Mr.
Grey's plane.
Mae it occurred to you that with Warburg's leaving

the Federal

Reserve Board Chapman may be releared, and, if so, we might find

for him?

I am writing

a

place

Warburg about it.

I do hope that pressure is regularly exerted to

get that pace,

otherwise we are in a bad hole.

ei_-te

take care of yourself and don't worry about the office.

With best regards,
Sincerely,

James F. Curtiogsq.,

rsarerwrtilrr, ass.
BS.MSB



September 5, 1918.

Dear Jim:

---

I wrote Laura from Woods Hole a couple of days ago, explaining that I had been obliged to make an unexpected trip to
'Washington after returning almost to Woods Hole, that is as far
as Boston, which made it impossible for me to got up to Mandhester
as I had hoped to do.
Unfortunately her letter was delayed in
reaching me, which accounts for the delay in my reply.
Now I
have yours of the 25th and really feel very sorry indeed that I
coed:sot hive a visit, because I fear from your letter that you
are a bit blue and not feeling very well.
That won't do: There
is nothing to be blue about.
Certainly you have no such excuse
for the blues as I have on the score of health, and your job is
to loaf about until you are feeling fit enough to come down
here and spell me a bit.
This morning I am back on the job, as are most of the
others at the bank, Treman being the only one away, so don't you
worry about the ihop, but submit to reasonable regulations of
an affectionate family who are simply doing what we all want thrall) do -- putting you back on your feet.
Many of the problems that have been troubling us in
connection with the loan, etc., are grad:sally working out and
think I begin to see daylight.
The only real difficult job seems
to be to convince the New York bankers that there is always going
to be enough money to go 'round.
They have chronic attacks of
"cold feet" but the new arrangement of the money pool, I hope,
will serve as a hot water bag.
Please give my love to Laura, and my best to you.
Faithfully yours,

James F. Ourtis, Esq..
Massachusetts.




September 6, 1918.
Dear Jim:

This is my first onance to tell you a bit of What's doing at the
bank, without any desire, however, to suggest your returning, or any thought

of it, but rather to let you know that we are getting along all right, but,
nevertheless, miss you from the daily councils.

The wind up of my holiday was disturbed, as I wrote you, by an unexpected trip to Waehington, but I have been on the job since Tuesday and find
things movinn: along pretty well. Treman is here; Jay is spending two or three
days in Washington; and Case went off last night for his vacation. Otherwise

the force is fairly intact.

The Liberty Loan Organization is well ahead on its work save in one

or two particulars, such, for instance, as this wretched part-payment plan.
We have worked out a temporary solution for this loan which our friends of the
War Savings Organization feel is something in the nature of sticking the knife

into their corpse, the death blow having been inflicted at th time of the
Third Loan.
I have a telegram from Vaederlip to-day, however, which announces
the intention of the Treasurer to bring the nar Savings Organization under the

general direction of the eederal :Reserve Bank, and asking me to take the matter
ur with their committeemen at once. 'needless to say we will de it.
I only
wish we had room in which to put them.

You will rejoice at the announcement which will appear in the morning

paters to the effect that the Loney Jommittee proposes to take a rather absolute
and arbitrary control of stock exchange loans. We expect to get reports of
borrowings by all stock exchange houses daily and when they indicate a tendency
to borrow toe much, simply tell them to atop and Abut down on them. One must
deal with the devil with his own weapons, and these Prussian methods are only
excusable on that ground.
Zeantime I hear in the club up-town that there
are more than a fow people in this neighborhood who think we are boesinn the
job rather vigorously.

ay last letter from Ben was e brief note expressing his trepidation
on the eve of examinations fir a commission.
I have entire confidence that
he will pass all right.
Our loans lately have been bouncing up and down, with fluctuations

of 70,0e0,000 or more, and, in that connection, we have about concluded arrangements with the sixty-eight faithful banks permitting the Money Committee

to control roughly :1,600,Cone,Jnn of *their stock sic:henna loans.

I have forsaken golf for tennis recently,
agrees-a letter better with a violent disposition.




finding

that the latter

Mr. Curtis

9/6/18.

Please give my love to Laura, and my best to your good self.

Don't forget that rest makes people well and after that exercise makes
them strong. Your job just now is to rest.
Ancerely.

James

4:nester, was.

,43$/Za33




September 18, 1918.

Dear Jim:

I have not written you, not wanting to turn your thoughts
in the direction of the bank, but it seems as though you would certainly be interested in the enclosed copy of a letter to Judge Ingram and
the resolution of our Board regarding the selective draft, also the
enclosed communication which I am addressing to all men liable to
military service.
All of the material was rather hastily prepared
as we learned only the day before the registration was to be made that
one of the questions on the registration card had material bearing upon
subsequent exemption procedure.
We have decided that it is necessary,
for the benefit of the organization, to tae matters pretty generally
into our own hands and decide which men should and which should not
claim exemption.
I sincerely hope that you agree with the general
tenor of the papers enclosed.
We are busy, but I think
comparison with previous loans.

very well ahead of the program in

The vacation schedule is pretty well completed and I think
all will be back at the bank by the end of this week or
next week, so don't worry about your own absence.
If you come down to
Glen Cove, I am going to insist that you stay there and do not permit
yourself to be drawn into the machine until I have had a talk with you
myself, and, if necessary, with your advisors, medical and otherwise.
Above all things, don't get restless.
We are all keen to see you
at your best and at the bank, but not too soon.

the first of

Sincerely,

James F. Curtis, Esq.,
Manchester, Mass.

BS/M3B
Enos.




September 18, 1918.

:Year Laura:

Pardon a dictated note to send you the enclosed
If you think it is all, right to pass
addressed to Jim.




on to him, please do so.
Sincerely,

Mrs. James F. Curtis,
Glen CoVe,

Doug Island.

BS/USB

Enc.




October 11, 1918.

,Qar Jim:

Thanks for your letter of Saturday, which I
really answered in person.
You hqve been advised of the action of the Board,

and now I insist that you accept the decision of the Board
cheerfully and make it your business to get well.

I have

been through this, and worse, and I um sure that you can

do it.
Sincerely,

Jam21.4.4aurti4,,,,g#4**,
Glen Gove,
Long Island,
Y.

BSPISB

aila-441

Fliali4(1 Van.

Lake George, N. Y.,
February 3, 1919.

aaar

It was very
quiet after you and Laura and the rest of the party left, but, as I wrote
I have your illtrbrtire'Skt_Januari 23rd and 27th.

Laura, I spent a !seek up at Schroon

Lake ice fishing with some friends and

managed to have a pretty good time.
I gather from What

Laura said

that Mrs. Jay was greatly concerned

about Pierre's health. Treman has talked with her and has written me quite
fully.

Won't you make it your duty to watch him and see that we don't add

another to our list

If there is any danger I am coming back.

of cripsples?

About the proposed pamphlet - in a word my idea was to publish

a digest of the various circulare,

regulations, etc., relating to transactions

with the reserve bank as fiscal agent of the Government as a guide both to
member banks and to -the public.

It is a very simple thing to prepare because

the instructions would relate particularly to qualifying as Government depositaries, handling certificates of indebtedness, handling Government bonds

and coupons, making transfers,

interchanges, etc., etc.

all specifically laid out and would principally consist of a digest in plain
language of Treasury

Department

circulars and of our oan.

Just now these

various instructions are covered by a multitude of circulars and amended
circulars ahich

have become so voluminous and complicated that

find it necessary frequently to write and make inquiry

institutions

although the information

is in their hands already.

I am enclosing a check for $277;

$40

covering my °hare of the

ilowers sent to Dorothy Straight and $237 being the additional in awatment I




Mr. Curtis

Sheet No. 2

2.3.19.
.V(1 nr.7,1AN

am making in George Marvin, without hope of financia4:phys4ca; ar moral
I

:1)

return thereon.
nalE.111,Prr'rnIrn-1",,,a,
The skating continues fine and I am keeping at it overyEaay.

My best to n11 at the office.
Sincerely yours,

I. F. Curtis, ltsq.,

Deputy Governor, Federal Reserve Bank of Ner York,
15 Nassau Street, New York.

BS.MSB




DZP71.
i.:21]
-LAI, 11 PrzrnTre,
eee,

Dear
I have yours of the fifth,

difficult Propositions, namely

p-

which calls for a reply as to two very

Anderson and Williams.

As to the first - I am not sure

he needs petting on the back.

Lake George, N. Y.,
February 7, 1919.

that I

-agree with your suggestion that

The suggestion was

natural enough because I guess

you are unfamiliar with a lot that has preceded the present
written

Arthur

that I would expect to see him on the

situation.

I have

fourteenth When I come down.

The fact is that some months ago I had this Whole thing out with him and with his
nartners.

The situation res fully explained to all of them, and particularly

Lamont, and all made it just as difficult as possible for us to

arrangement with

Anderson.

to

continue the

But, nevertheless, we did continue it, with a

understanding all 'round of the importance of his remaining on the job.

thorough

ithin

a few weeks Lamont calmly goes abroad, taking with himAnderson's assistant and
throwing

the Whole situation into

ihowing us more

confusion.

Primarily, I blame Lamont for not

consideration, vhich he could have done by chasing another

tary for his work

abroad rather than

secre-

George Whitney, but I also blame Anderson

because if he asserted himself as much with his people at 23 Tall Street as he
does with us, Lamont, I have no doubt, could have been
arrangement than to take

Anderson's

My first impulse,

right hand

on hearing of

man away at

beut some of these things as a

than by dorrespondence.


other

this time.

all this from Anderson, was to go right

to New York end try and get Sweezy to take the job.

I wrote him that I would talk it

induced to make some

over on the

On further

consideration,

fourteenth. He is as pig-headed

mule and I would rather tackle him face to face

Ur. Curtis

2.7.19.

I think you will find he has had a very frank talk with Mrs. Pratt
about his rork in the organization, and she writes me that he invited himself to
dinner with the family one night and, after44746,ntea 44iii.scussion, he seemed to

be satisfied to go ahead and do the best he could.

It is just as well right now to say nothingriber about it, i believe,
until I get down.

You little know the ;MOi'int4f-176dav4ImMnt arid difficulty

have had between various members of that head-strong bunch.

About Tilliems r I am in much doubt.

Your own suggestion I don't

believe is a good one should it come as a voluntary contribution to the discussion.
On the other hand, if Senator Weeks bill to abolish the Comptroller' e Office

revehes the point 'here the Senate Committee has a hearing, then it could be easily
arraneed to get e unanimous expreesion from the governors of the reserve bunks.
You see, the reeson Why volunteering an opinion would be of no value is because

VAlliaes :.oliiiinstantly say in reply that the reserve banks were attempting to
grasp too much power, even the power now exercised by the Comptroller, and that
pretty soon they would be running the Whole Treasury.

I have thought, and have

recently written Jay suggesting Whether it might not be a good plan for ma to

write Carter Glees a personal End thoroughly frank letter on this subject.

Still

another method would be to hav a grout of bankers Whose character and pesition

eould insure their being beyond reproach as to motive, to ask all of the banks of
the country for a °referendum vote.

The devil of it is that nllimes will make it a persona] metter. It
should not be approeched on that ground at ell, but that ground cannot be escaped

on account of his personality.

Very forceful arguments could be advanced for do-

ing away with the Cometroller's Office and if be were a big enough man he would

advance them himself end be the strongest advocate of doing so.
I have never been able to understand why the Federal Reserve Board

hasn't done something about this matter.

be at it.



They are the ones to do it, end should

Mr. Curtis

2. 7. 19.

44)7,

I guess I'm getting old - At any rate i've lost my4sire to fight
, 11;
with that fellow such as I had in the earlier days.
-1.1Z 240_

Talk it over with Jay and 13t me know how he feels.
Faithfully yours,

J. F. Curtis, Oss.,
Deputy Governor, Federal Reserve Bank of Nov York,
15 Nassau Street, New York.

BS.VSB




PTf

i4INC

:,-1)
Lake George, N. Y.,
February 8, 1919.

FEDERAL RE5EriVE 1.77:_nK
Dear Jim:

I have just read in the newspapers that reeks is pressing his bill
to abolish the Comptroller's Office and expects to have some hearings.
only way in which

the

The

reserve banks can appear safely in the matter would be to

have the committee call upon the governors for expressions of their views.
know weeks,
matter.

but

I

don't see Why I should be made the victim or cat's paw in the

Furthermore, I think Weeks is making a serious blunder in attacking

the subject on

the

two grounds which he

has announced;

one the abolishment

disqualification

of duplication of function;

and the other the temperamental

of the present incumbent.

He had better leave the latter alone, for he

get licked on it.

'ere I asked for a

frank opinion about the

rill

Comptroller,

a veil-balanced, judicial reply would necessitate my saying in brief that he
is an honest, conscientious and

energetic men,

and has been the victim of a lot

of rather unintelligent and spiteful criticism;

that he really desires, and

has sought in his own' way to establish better banking

methods.

On the other

hand, that temnerementelly he is led to employ arbitrary, and in some cases,
abusive methods Which have led to a great personal dislike and

the part of the banks, and

that

The mere fact that you

antagonism

on

there has been much fault on both sides.
and I differ rith

i11iams in many of his

theories of banking and in the conduct of his office is no justification for
claiming that he should not be reapPointed.

Hs has done some highly emotional

and passionate things, but I believe it would be difficult to Prove disqualification in an atmosoherethat is so surcharged with personal animosities.

They

are his protection.



If I

ere Senator Weeks, I rould base the rhole procedure

upon the

Mr. Curtis

theory that the establishment

2.8.19.

of the Federal Reserve System

resulted in a lot

of unnecessary duplications Vhich can now be eliminatei.,because
established and

in competent

hands.

The

four great

the system is vol

duplaiithie

Check Collection
Clearing Houses
The Subtreasury System

eforred to are'

1,1)

The Comptroller's Functions as Ciiiiii4144rmit
the currency and supervisor of banking.
IF.hy

not lump the Whole thing together, and appeal to Congress on the sound

safe ground of eliminating duplication and expense!

and

Upon that ground appeal can

be made to the bankers of the country for support and all personalities can

I think reeks is

avoided.

rather

stupid in his program.

I wish you would talk over with Jay the possible advisability of a
discussion of this matter with Glees.
Faithfully yours,

J. T. Curtis,

Deputy Governor,

Federal Reserve sank of New York,

15 Nassau Street, New York.

ES.VSB

Dictated but not reed.




be

,417;ou,

k

Dt

Lake George, N. Y.,
February 17, 1919.
RESERVE,

Deer Judge:

Y.:Menke for yours of the twenty ourth, regarding real estate and

tenents.

After discussing matters with Vr. Trowbridge, I em dispesed to push

the building program someWhat, and think re should get to work on the-tenents

pretty soon.

I En disturbed hbout the uncertainties as to the Ely title. Does that
mean e long drawn out procedure to quiet

the title!

rr. Trowbridge has sug-

gested that if the title difficulty is to indefinitely postpone our accluisition of
the 131y title, word to that effect should be conveyed indirectly (so that it would
not be known as coming from us) to Cohen and his associates.

It would make him

pretty tired to get hung up on a high price with the end piece

if A defective

title intervenes between him and us, so that it makes it impossible for us.to.buy
him out.

There ie an old saying about being hoisted by your on petard, that

might apply.

In my opinion, Cohen is bound to lose money on his purchase, unleee we

1111116$

see him out, because he has purchased real estate, undoubtedly at such a price
that it can not be made to nay without modern improvements, etc., and he heen'
%Pk

enough land to put up a big building.

Your very formal letter to the other governors may, as you say, arouse
the ire of the Federal Reserve Board.

l'hy didn't you just drop them a poreonal

note, asking if they would stay over 4 day or trp for some semi-social, semibusiners diecussiont

James F. Curtis, '7n.,




(Pr'r1e)r

Faithfully yours,

ernl Reserve Bank,




Lake George,

March 1, 1919.

Y.,

Dear Jim:

have your note of the trenty7seventh, and am enclosing my check for '449., covering my share of the expense of

the dinner in honor of the Secretary.
after my end of it.

Thanks for looking

Faithfully yours,

Deputy Governor, Federal Reserve Bank of tier York,
15 Nassau Street, Nev York.

(signed in Mr. Strong's absence)
VSB

Tnc.

- Check No. 1004 - 149.00

Misc. 4

'2fice Correspondence
To

FEDERAL RESERVE

BANK OF NEW YORK

Mr. Uurtis

Date-J-Une _30, 1919.
Subject'

1,113IN

Benj, Strong

IOM

JUL I

Your new partner spoke to me about a

now in Joe Oottun's office, and Mr.

Treman

firsA4WgilliireRiii. BANK

has just spoken to me of a

Mr. Paine, of White and Case.

Will you have a word with me about this at the
opportunity?

BS/MSB




1919

first




December 10, 1919.

Dear
M,

friend :,oberts -alter, of Mite

(11.Fe, some time

su6dest, 1 that your friend Freund, hho 11,as been acrkIng with

the Railroe.d Administr4t.Lon, mijht be a likely ,artaar for a youn6
JAwrIr.

I think I spoke to you about it, but he mentioned it

ain tod y uld I Anted to make sure that I had not ovrlooked
it, hence this n-,te.
1careLy,

F. CuItii, i440,
New lork City.

Form 1207
CLASS OF SERVICE DESIRED
Telegram

e Letter
.dight Message

Night Letter
Patrons should mark an X opposite the class of service desired;

OTHERWISE THE MESSAGE
WILL BE TRANSMITTED AS A
FULL-RATE TELEGRAM

WESTE70,41NA UNION
AM
TEL
NEVVCOMEI CARLTON. PRESIDENT

Time Filed

pril 8, 1221

Mrs. James F. Curtis

Street and No.
Place

Chock

GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT

Send the following message, subject to the terms
on back hereof, which are hereby agreed to

To

Receiver's No.

-

FLclyn, Long Island

Dear Laura

I am distressed about your loss and propose that we give a

donatigin_p_rty gifts limited to solid silver and other articles attractive
to burglars

SENDER'S ADDRESS
Digitized forFOR ANSWER
FRASER


Benj. Strong

SENDER'S TELEPHONE NUMBER

19

lir

ALL MESSAGES TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING TERMS:
To guard against mistakes or delays, the sender of a message should order it REPEATED, that is, telegraphed back to the originating office for compart...,
or
this, one-half the unrepeated message rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED MESSAGE AND PAID FOR
AS SUCH, in consideration whereof it is agreed between the sender of the message and this Company as follows:
The Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery' of any UNREPEATED message, beyond the am''
received for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery, of any REPEATED message, beyond fifty times the sum rec._ fed
for sending the same, unless specially valued; nor in any case for delays arising from unavoidable interruption in the working of its lines; nor for errors in cipher or obscure
messages.

In any event the Company shall not be liable for damages for any mistakes or delays in the transmission or delivery, or for the non-delivery, of this message
whether caused by the negligence of its servants or otherwise, beyond the sum of FIFTY DOLLARS, at which amount this message is hereby valued, unless a greater value
is stated in writing hereon at the time the message is offered to the Company for transmission, and an additional sum paid or agreed to be paid based on such value equal
to one-tenth of one per cent. thereof.
The Company is hereby made the agent of the sender, without liability, to forward this message over the lines of any other Company when necessary to reach
its destination.
Messages will be delivered free within one-half mile of the Company's office in towns of 5,000 population or less, and within one mile of such office in other cities
or towns. Beyond these limits the Company does not undertake to make delivery, but will, without liability, at the sender's request, as his agent and at his expense
endeavor to contract for him for such delivery at a reasonable price.
No responsibility attaches to this Company concerning messages until the same are accepted at one of its transmitting offices; and if a message is sentto such
office by one of the Company's messengers, he acts for that purpose as the agent of the sender.
The Company will not be liable for damages or statutory penalties in any case where the claim is not presented in writing within sixty days after the message
is filed with the Company for transmission.
Special terms governing the transmission of messages under the classes of messages enumerated below shall apply to messages in each of such respective classes in addition
to all foregoing terms.
No employee of the Company is authorized to vary the foregoing.

THE WESTERN UNION TELEGRAPH COMPANY
INCORPORATED

NEWCOMB CARLTON, PRESIDENT

CLASSES OF SERVICE
TELEGRAMS

A full-rate expedited service.
NIGHT MESSAGES

Accepted up to 2.00 A.M. at reduced rates to be sent during the night
and delivered not earlier than the morning of the ensuing business day.
DAY LETTERS

A deferred day service at rates lower than the standard tele-

gram rates as follows: One and one-half times the standard Night
Letter rate for the transmission of 50 words or less and one-fifth of
the initial rates for each additional 10 words or less.
SPECIAL TERMS APPLYING TO DAY LETTERS:
In further consideration of the reduced rate for this special "Day
Letter" service, the following special terms in addition to those enumerated above are hereby agreed to:
Day Letters may be forwarded by the Telegraph Company as a
deferred service and the transmission and delivery of such Day Letters
is,

in all respects, subordinate to the priority of transmission and

Letter shall be delivered on the day of its date absolutely and at all
events; but that the Company's obligation in this respect is subject
to the condition that there shall remain sufficient time for the transmission and delivery of such Day Letter on the day of its date during
regular office hours, subject to the priority of the transmission of regular telegrams under the conditions named above.

No employee of the Company is authorized to vary the foregoing.
NIGHT LETTERS

Accepted up to 2.00 A.M. for delivery on the morning of the ensuing
business day, at rates still lower than standard night message rates, as

follows: The standard telegram rate for 10 words shall be charged for the
transmission of 50 words or less, and one-fifth of such standard telegram
rate for 10 words shall be charged for each additional 10 words or less.

SPECIAL TERMS APPLYING TO NIGHT LETTERS:
In further consideration of the reduced rate for this special "Night
Letter" service, the following special terms in addition to those

delivery of regular telegrams.

enumerated above are hereby agreed to:

is not permissible.
c. This Day Letter may be delivered by the Telegraph Company
by telephoning the same to the addressee, and such delivery shall be a

be deemed to have discharged its obligation in such cases with respect

Day Letters shall be written in plain English. Code language

complete discharge of the obligation of the Telegraph Company to
deliver.

This Day Letter is received subject to the express understanding and agreement that the Company does not undertake that a Day
D.




Night Letters may at the option of the Telegraph Company
be mailed at destination to the addressees, and the Company shall

to delivery by mailing such Night Letters at destination, postage
prepaid.

Night Letters shall be written in plain English. Code language

is not permissible.
No employee of the Company is authorized to vary the foregoing.




December 23, 1921.

4- svilif

My dear Mr. Curtis:
Mr._ Strong has asked me to send you the

enclosed as a little Christmas remembrance for
J- mes F. Curtis, Jr.

With kind greetings
Your

James P
urtis Esq.,
Woolworth Buil ing,
NOT York City.
Enc.

elieve me,

very truly,

a')

Je,nuary 14, 1.122.

Dear Jim:

Todey for the first time I cm taki% a crack at a little
reek or ten dhps, after which

mail, ?reparatory to going awfty for
I expect to be back at the office.

I can't tell yeu how much 1 apprecieted
.A that
received at the hospital from you end Laera, inclwAini< yeur twe lettees, some flowers, end a lovely plant which seemed to have a certain

tenacity of life thht outleetod everything else that I had in thet
line.

They told me a day or SD ago that you had been good enough

to call here Kt the house to see me, - all ef which transpired after
you had left.
The fact ia that I have been shut off entirely from
callers, and, urtil the lest day or two from eny oonversetion, because
the Doctor wanted my tongue to be free of any unnecessery motion. As
he expressed it, I was no more entitled to une my tongue than a man

was jestTfied in walking or.
That was the reason why they

broken leg that was only half knit.

But WS will make
visit with you and
Please ziv e Laura my love and tell

gave you the meseue;e.

it all up on my return, and I hope to have a fine

Laura, and kiss

her I will write
going.

the 'god-son.

her en extra apeciel just as SJA1 S.S Iet my fist

With my best to you both,

Sincerely yours,

J. F. Curtis, 44.,
wooly/North Building,

New York City.

Dictated but not read.



January 30, 19??.
Dear Jim:

This is my first day at business, and among other items and a large
accumulation of mail, I must promptly answer yours of January 12.
I do not know what eomment you have heard Nith rsspact to my views on the

subject of the amendment ef the Federal Reserve Act, recently aassed by the Senate.

I do recall the provisions af the se-canoe Burtun Lill very ctearly, althaugh I
have not it before me nt the moment.

Do yo' remember 7,t, the Plaza Fotel, when I

sat, done up in plaster, my having stated that if a definition of "clacs represeataticn" of the Federal Reserve Board as to be made, it ehauld be sufficiently

comprehensive to be free from the possibility of criticism.

I have no objection

whatever to having a farmer on the Federal heserve Board, end I do not think that

as the leg vill read, with tha Senate amendment passed, that it is open to objection
on that ground alone.

Wy objection relates more to the method of dealing with

the matter, and more specifically to the rumor, which may not be the fact, that
the arrangement for the passage of the amendment as the result of a bargain, or

underetanding, that a farmer mould be appointed.

Let us have the farmer; but

do not let's tie the hands of the appointing polar except under the constitutional
provision as to confirmation.

I

gould rather have no definition in the his, than

to have a bargain of that character made, although I cannot say definitely that
any suoh bargain was made.
or men

Another ground of objection is that no reference is

made to having a manAof banking experience on the Doard.

That strikes me as

unfortunate in the extreme.
You may be surprised to learn that I have a good deal more sympathy

for the so-called Agricultural Bloc than some people appear to have.




That I

January 30, 192.

object to most strenuously is the employment of speoial.cualitions in such a
way that the whole legislative program is held up.

If they could only have

been restrained for a reasonable time, I believe Lhat Gonreseman Anderson's
Commission would have furnished the material to Cengresb for a mere thorough-

going treatment of a11 these questions, thnn is pcesible in a piece-7,ea1 scheme

of legislation.
Of course, I recall that sliding oo1

rovielen in the Burton bill,

which I confees was a fancy idea of my own - one

the bright ones t'Int one

gets after vioriini, until fuur o'clock in the niorning on vhat seems to be a.)
impossible situation.

But fallible 'mortals can change their views.

I not

regard it es a ?eculiarly vicieus 7:repose.,1 although I did not express it that
way .then making thet infernal statement.
The name of the school

hresa, Arieonn. is The Evans. School; hut I am

afraid that -le must write to Bishop Atwood to learn the name of the Head Master,
which has completely gone cut of my head.

I hope that you and Laura and the yc.eingsters are -veil, and that I will

soon be able LI have a visit with you.

Thanks for your letter.
Yours sincerely,

James F. Curtis, Esq.,
loolworth
New York, N. Y.
BS.UN.



December 20, 1922.

Dear Jim:

I am enclosing a little Christmas present for
that godson of mine, the delivery of which I hereby entrust
to you.

With it I am also sending a very Merry Christmas

to all the family.
Yours sincerely,

James F. Curtie, Esq.,
fictrIVOrriTgrak.,
New !,:ork City.
BS.MM

Eno. (i60.01/1YJ




December 22, 1922.

Dear Jim:

Thanks for your rote.

I wish I could run

down

family party that will
for Christmas Day, but I have a bi8
take ut the whole day.
Flea,e give my love tc, Laura ar.d tc the kids,
and a very Merry Christmas to all of you.
Yours sincerely,

Mr. J9mes F. Curtis,

Mewerw..---ettrtts, FOsdick & Be11(11541,
Woo 1 worth 91dg . , New York City.
t3.9.MM




December 20, 1923.

Dear Jim:

The enclosed is a little Christmas remembrance for that

godson of mine, the delivery of which I Lm kindly entrusting to
you.

tith best wishes for a very Merry Christmas, believe

me,

Yours sincerely,

Mr. James F. Curtis,
233 Broadway,
New York, N. Y.




.

)

-

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,)

December 27, 1923.

Dear Jim:

Many thanks for your nice note.
out evening engagements almost entirely.

For a while I am cutting

There are a few that I cannot

absolutely escape, but I think until another month or so is past, that
I must still go slow.

If you ever lunch uptown, we might arrange to

lunch together instead, as I am cultivating the habit of working uptown
in the morning and then loafing in the aJternoon.
Happy New Year to you.

Sincerely,

Mr. James F. Curtis,
233 Broadway,
New York, N. Y.
BS.AM







October 2d,

1..

t2,4.

Dear Jim:

I hope you will understand my delay in ':Anstvering your

letter which reached me at Colordeo

I wee not very well Fihile there &ad did no letter writing,
and unfortunittely our Ci'ommittee wc,.e.,in seesion when you we.me in

yesterday, ,,,nd I could not to for a chat.
I

eln sending Maxie lctter on to P.idciy.

Pleak,c come in ag:,.in when you a,re down in t:ie ne4hborhood.

Sincerely,

.iInes F. Curti.!, Dr:"
tooliorth Building,
trw YdrK, N. Y.

P. 5.

Your reierenct:; to Basil's w.ft&irs is rather dzyptle, and
not sure that I unnerste.nd the reference.




February 18, 1,;425.

Dear Jim:

I nm just bock from the 3outh todmy and am obliged

by the usual accumulation of mil to send this typewritten

regret to your note of the thirteenth.
On the nineteentt the Trust Companies section of
the American Bankers Association is giving its banoist, and.
I am already committed to that.

I am still being careful

about evening engagements but now u,nd agmin feel obliged

to accept invitations to these bank affairs.
in sorry, though, to mit:in meeting General 6ir

Frederick Maurice, and a. chance of so interesting a
gathering.
My best to you!

sincerely,

Mr. James F. Curtis,
233 Br)adway,

Nta

Nk,111 York.




0

0)))),X.4

Hot el Bright on,

Atlantic City, N.J.,
Febtualy 21, 1928.

Dear Jim:

You may not have seen the :7nolosed note from

I count it a fine production from a boy of his
age, with evidences in it that his dad has an eye to
his scholarship, just es he had to "those ones" at the
Federal reserve bank in years gone by.
We might have a little argument about the spelling of "affectionately," and whether Codson can be spelt
zith a small "gee and show proper respect to the Deity.
I am proud of the boy, just as you must be.
Curtis.

Sincerely yours,

Mr. James F. Curtis,
67 lAtst 53rd Street,
New York City.

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FEDEA FySERVE BANK
1EW YORK

3p,M1 9\1

PERSMAL

January 8, 1911.

'7 dear Gov:
I have your two letters of January 3rd.

Before answering then,

permit me to observe that your new stenographer (CC) apparently shares the

erroneous view, somewhat current among others, that I am an employe of, a
member of, or subject to the Federal Reserve Board, as I note that the said
CC addresses me at the Federal Reserve Board,

'ew York City.

It is true

that the Board is very active in the affairs of the bank but they have not
yet moved their office over here, so kindly keep me in my proper place for
a little while longer.

About the weekly reports I have to say that copies of the letters
to you have not been Sent to the Federal Reserve Board for several months.
It was a practice which began, I think at the suggestion of Delano, some
time during the summer, when he found that we sent you a weekly synOpsis
of affairs, as he thought it would save us trouble if we sent a copy to
him.

7y impression was,at that tine that we sent him a copy with the un-

derstanding that it was for his confidential information and not to go on
the files of the Board.

The practice was continued until the end of

September when 7r. Jay decided that in view of some of the matters which
were included in the reports, it would be unwise to continue sending them
to 7r. Delano, and since that date, so far as I know, no copies have gone
to the Board.

About the Bank of England matter and natters in general at Washington, I agree with you that there seems to be nobody who understands the effect that words may have.



With 7r. ilson I feel this is clearly based

FEDERAL RESERVE BANK OF NEW YORK

Benjamin Strong, Esq.

1/8/17.

upon the fact that he does not himself translate words into deeds and, therefore, has lost touch with those wha do.

He also gets wrapped up in the

beauties of his own expressions and fails to make them express his meaning
as clearly as he used to.
"'ith the Board I think the case is somewhat different, although the
I know they are having a very hard

result comes to about the same thing.

time there owing to the variety and strength of the cross-currents, concern-

ing which you are not unaware, but it does seen that every time they open
their mouth, they put their foot in it.
(-7-7i;Tiou and I both eurmised, Davison was not the greatest diplomat

on record, especially when asked haw many of the treasury bills they proposed
to issue.

His reply WAS to the effect that they pronosed to issue them

without any limit and up to any amount that the

banks would purchase, and

when one member of the Board (who was friendly) said, "Do you mean absolutely up to the noint of saturation?" Davison replied, "Yes," and he would give

no figures of any possible limit, excent such vague remarks as possibly half
a billion ar a billion.

Two days later the New York Tribune had a story that the amount
to be issued was up to a billion, which apparently affected the Board.
Commenting on this phase of the situation, Jack norgan told me that they had

not intended to issue, as a natter of fact, more than the amount of gold
held by the British government in Ottawa, which was something over a hundred
A144.404

millions, and his only connent on the igthawa of the Tribune statement was

that it was a new thing in his experience to learn that this administration
took anything the Tribune said as grounds for conduct.

At the conference one of the members of the Board, who wanted to
. traighten things out, asked Davison if he could not nostpone any announce-

ment or action for about a week, thinking that during that time the more



Benjamin Strong, Esq.

FEDERAL RESERVE BANK OF NEW YORK

ZZ
0

1/8/17.

violent members of the Board might be composed into a position of acquiescence.
To this, however, Davison only replied that their arrangements were made and
could not be held back, and that he was only telling these things to the
'

Board as a natter of courtesy and not with the expectation of receiving any
advice.

Of course the Bank of England announcement was made to offset the

treasury bill one, and the combination of the various announcements naturally tends to make everybody wag their heads sagely and say, "I told you so,
political motives are still in control."

However, our committee is going

down to have a conference with them on 7ednesday, and 'I hope may accomplish

In the meanwhile don't you want to draft a letter to the Bank

some good.

of England, putting the final touches on the understanding, so that we can
really get busy?

Perhaps you have already done this without its having

come to my attention, as I have not been at the office for almost a week.
As to resignations, there are so many of them fluttering in the
breeze that I hope nobody sets the example by actually shipping one along.

Delano told me confidentially that it was all they could do to persuade Harding
from resigning when he got a very good offer the other day.

He has been ill

and under much criticism and apparently was about ready to throw up the sponge

but they persuaded him that the fat would surely be in the fire if he did, and
so he is staying on.

I suppose if he did resign, Barney Baruch would be

appointed in his place, in order to prove that the stories about his profits
tt

on the leak are base slanders.

Nevertheless, I have sort of a feeling that

'qarney was short of the market at the correct time, although, like Tom Lawson,
I couldn't prove it.

By the way, permit me to assure you that the "A. Curtis,"

who wrote to Congressman ood, is not yours truly, nor even my distant relative, Allan.

Apparently it was a name selected by a humorous letter writer

because it sounded like somebody real, I suppose.



It is still very amusing

FEDERAL RESERVE BANK OF NEW YORK

4

Benjamin Strong, Esq.

Ca
to a Bostonian to see some people taking Tom Lawson seriously at this late day.

I think Gus Gardner has the right idea of what happened, to the effect that some of the ticker news service people broke the confidence which
apparently Lansing had placed in them.

You don't know Barron as well as I

do, but neither he nor his henchmen would hesitate to turn a little trick
&I,A42144.

44,--1.

4

like that, especially when it was so easy to make a little money.

The reason why this letter is so long and discursive is that I
sit at home with my feet in a chair and have nothing else to do but talk.

Have you seen a copy of the Board's proposed amendments, as shown

sour 64.

in Opus 944?

In case you have not, I am sending you a c"Yr "

im,

4.-et

014-4. t-41-4

f 2 ,n,

I think their suggestionsconcerning the amendments to Section 19

are very good and I believe they have struck upon the right principle, except
that I do not believe in the idea of requiring any amount of till money to
be carried in the member banks' own vaults, as provided at the top of page
3 of Opus 945, in view of the other provisions of the amendment.

The real

effect of the change, with this sentence added, is to leave the reserve rea., al- 14.4"-A-4---r

quirements the sameA(except as to the amount held against time deposits) and
.it 5'1 of the reserves to be carried in deposits with Federal reserve barikepo

gold certificates, silver certificates, greenbacks, Federal reserve notes,

Federal reserve banks notes, national bank notes, or quarters, dimes or nickels
which does not seem to me a very scientific provision.

I would be more in

favor of their original plan of having the only reserves required, a balance
in the reserve bank, and let each member bank decide for itself the amount of
till money which it considered necessary or desirable to have on hand for the
conduct of its business.

for the amendment shown on Opus 906-b, I an strongly opposed to
it, as I believe the only time that the 73oard would exercise the function of

increasing the reserve requirement would be when it was absolutely useless or



446.4

FEDERAL RESERVE SANK OF NEW YORK

Benjamin Strong, Esq.

1/8/17.

when such action would bring on A4 nanic,.vhich it was intended to prevent.

I an also opnosed to Opus 947, as I don't believe in trying to
tease the State banks into the system by. this sort of half-way bait.

In

my opinion it won't work and the Board will be in the position of nublicly
asking for something that the State bankers will publicly refuse.

On the

other hand, if it does work, I think it will antagonize the national bankers,
Tio will stPnd by and see the State bankers obtaining what will appear to be
the only useful thing to be got imm out of the reserve system without paying
the same price for it.

I am in favor of the amendment to Section 17 of the Act, as pro-

posed, and only wish the Board would go a little further still along this
line.

In Opus 950 I think they make a mistake not to correct the sections
there and change No. 4 to 7o. 14 in the third line.
I hope this letter has not overwhelmed you with its length and that
you won't attempt to reply except on the instalment plan.
I am still expecting to go West some time this month, although the
exact date gets farther off the nearer it arproaches.
the holiday season without mishap.
Yours, as ever,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.

JFC/CEP




I trust you survived

3
FEDERAL RESERVE BANK
OF NEW YORK
January 13,

1917.

JAN1 9 :.;11
7y dear Gov:

Referring further to your letter of January 9th, you need not be
disturbed in mind about the action of our board with respect to the Bank
of ?ranee matter.

Neither the board nor 7r. Treman contemplated asking the

2ederal Reserve 73aIrd for permission to negotiate with the Bank of France

and his letter was misleading in this regard.

All that was contemplated

was to send down in the near future an application for permission to appoint the Bank of -2rance correspondent

and agent, which would be made out

in exactly the same form as the formal application with respect to the Bank
of England.

Referring to 7-our letter of December 24th, I want to say that I

think you are under a misapprehension about the foreign paper money that
So far as I am aware, nothing has been handed to

has been given to me.
me by 7r. Reixeotto.

Of course, I have a little box filled with your

paper money but I think it came to me from somebody at your apartment,
although I may be wrong.

I note that in both November and December I deposited

E).20 to

::our credit at the Bankers Trust Company to take care of Piping Rock Club
bills.

Your note of December 7th, however, seems to indicate that the

second one should have been for !8.50, so that I guess I owe you

2.30,

which I will repay if it is the correct amount.

Don't forget to advise me promptly what you want to do about
Hot springs, Ark., as I an really very nearly on the wing now for the West.

Benjamin Strong, Esq.,
4100 Montview Boulevard,

Denver, Colo.
http://fraser.stlouisfed.org/
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Federal Reserve Bank of St. Louis

Sincerely yours,

OSTAL TELEGRAPH.
[FINEST

COMMERCIAL CABLES

TELEGRAM

CRANIA. BUILDING

920 17y9 STREET

DENVER. COLO.

TELEPHONE: MAIN 4500
The

.

CLARENCE H. MACKAY: -PRESIDENT.

RECEIVED AT MAIN OFFICE

DELIVERy No.

73

r,k.,

Telegraph-Cable Company(Incorporated)transmits and delivers this message subject to the terms and conditions printed on the back of th,

150-29915

DESIGN PATENT Ile. 401111

7/i YJ F
TELE,

57 cb jo 29 1019am

M YewYork

WED

Jan 18 17

Benjamin Strong
for

Will

4100 MontView

startAchandler Tanuary 26th.

Blvd.

Denver

Jerome Greene also coming can

you reserve room for him Suggest you join our train near Trinidad

Will telegraph




details later

J F Curtis

POSTAL I

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int,sta -11
Walgrfr

JAPAN

OPERATOR'S b314
TIME SEW

VANGOLIVE

PACIFICCE AN

COIC.K.HAMA

SAN IRAN

MIDWAY

BERMUDA

ATLANTIC
OCEAN
T V.114CFIT

THE GREATEST TELEGRAPH AND CABLE SYSTEM IN THE WORLD.

EXTENDS OVER TWO-THIRDS OF THE WAY AROUND THE EARTH.

THE POSTAL TELEGRAPH-CABLE COMPANY

%COS PORATE.)

TRANSMITS AND DELIVERS THE WITHIN TELEGRAM SUBJECT TO THE FOLLOWING TERMS AND CONDITIONSI

To guard against mistakes or delays, the sender of a telegram should order it REPEATED; that is, telegraphed back to the
Comparison. For this, one-half the unrecorded telegram rate is charged in addition. Unless otherwise indicated on its face, THIS ISoriginating office for
AN UNREPEATED
TELEGRAM AND PAID FOR AS SUCH, in consideration whereof it is agreed between the sender of the telegram and this Company as follows:
1. The Company shall not be liable for mistakes or delays in the transmission
or delivery, or for non-delivery, of any
,mount received for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery,UNREPEATED telegram, beyond the
of any REPEATED telegram, beyond
,Ity times the sum received for sending the same,-UNLBSSSPECIALLY VALUED;
orking of its lines; NOR FOR ERRORS IN CIPHER OR OBSCURE TELEGRAMS. nor in any case for delays arising from unavoidable interruption in the
I. In any event the Company shall not be liable, for damages
for any mistakes or delays in the transmission or delivery, or for the non-delivery of this
legram, whether caused by the negligence of its servants
otherwise, beyond-fifty
REPEATED telegram rate, at
this telegram,
,nt as a REPEATED telegram; la, hereby valued, unless or greater value is stated intimes thehereon at the time the telegramwhich amountthe Company if
a
Is offered to
for
Ansmission, and an additional Burn paid or agreed to be paid based on such valuewritingto one-tenth of one per cent. thereof.
equal
The Company is hereby made the agent of the sender, without liability, to forward this telegram over the lines of any other Company when
reach its destination.
necessary
Messages will be delivered free within the established free delivery limits of the terminal office.
For delivery at a greater distance a special charge will be
,ide to cover the cost of such delivery.
_/_111,
..
No responsibility regarding messages attaches to this Company until the
accepted at one of its transmitting offices: and if any
esiage is sent to Such Office by one of this company's. messengers, he acts as thesame'rre'presented and the
agent of the sender for
purpose of delivering the message and any notice or
structions regarding it to the Company's agent in its said office.'

The Company shall not be liable for damages or statutory penalties in any case where the claim is not presented in writing within Edify dar after ths
legram 14,1,1 with the Company for transmission.
7. The al., ib terms and conditions shall be binding
upon the receiver as well as the sender of this telegram.
I. NO EMPLOYEE OF THIS COMPANY IS AUTHORIZED TO
VARY THE FOREGOING.
C.

siARLES C. ADAMS,
VICE-PRESIDENT.

f

CLARENCE H. MACKAY, PRESIDENT.
EDWARD REYNOLDS, VICE-PREST. AND GENERAL MANAGER.

CHARLES P. BRUCH,
VICE-PRESIDENT.

'HICIASTEST TELEGRAPH SERVICE IN THE WORLD




POSTAL TELEGRAPH

TELEGRAM

RECEIVED AT MAIN OFFICE
CRAMMER .1.111.0ING

O 17TH STREET

D

COMMERCIAL CABLES

CLARENCE H. MACKAY, PRE$1DENT.

.NER, COLO.

TELEPHONE: MAIN 4000

DELIVERY NO.

The Po talTelegraph-Cable Company(Incorporated)transmits and delivers this message subject to the terms and conditions printed on the back ol this Limit.
160-29018

97cbwh

DESIGN NITENT 116, 101110

22

1114a

CB.npwyork,Jan 19,17

vinjamin Strong
4100 Vontview Boulevard
Woodward suggests adding at end
or desirable end quote letter
and Roberts




J. F. Curtis

enver, Colo

Sy--

of letter the rfords

as changed

approval by Kent

POSTAL TELEGRAPH-COMMERCIAL CABLES

THE GREATEST TELEGRAPH AND CABLE SYSTEM IN THE WORLD.

OPERATOR'S NOTATIONS,
TIME SENT, ETC.

EXTENDS OVER TWO-THIRDS OF THE WAY AROUND THE EARTH.

THE POSTAL TELEGRAPH-CABLE-COMPANY

(INCORPORATED)

TRANSMITS AND DELIVERS THE WITHIN TELEGRAM SUBJECT TO THE FOLLOWING TERMS AND CONDITIONSI

To guard against mistakes or delays, the sender of a telegram should order it REPEATED; that is, telegraphed back to the originating office for
comparison. For this, one-half the nnrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED

TELEGRAM AND PAID FOR AS SUCH, in consideration whereof it is agreed between the sender of the telegram and this,Company as follows:
I. The Company shall not be liable for mistakes oretelaye in the transmission.or delivery, or for non-delivery of any UNREPEATED telegram, beyond the
amount received for sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery, of any REPEATED telegram, beyond
tlfty times the Sam received for sending the same, UNLESS SPECIALLY VALUED; nor in any case for delays arising from unavoidable interruption in the
working of its lines; NOR FOR ERRORS IN CIPHER OR OBSCURE TELEGRAMS.
2, in any event the-Company shall not be liable for damages for any mistakes or delays in the transmission or delivery, or for the non-delivery of this
telegram, whether caused by the negligence of its servants or otherwise, beyond fifty times the REPEATED telegram rate, at which amount this telegram, if
sent as a REPEATED telegram, is hereby veined, unless a greater value is stated in writing hereon at the time the telegram is offered to the Company for
tratierthasioS, and

an additional sumpaid 10r Wiled to be paid based on such value equal to one-tenth of one per cent. thereof.
The Company IS hereby tntde the agent ofilth' sender, without liability, to forward this telegram

over the lines of any other Company when necessary
reach its destination.
4. Messages will be delivered free within the established free delivery limits of the terminal office.
For delivery at a greater distance a special charge will be
made to cover the cost of such delivery.
No responsibility regarding messages attaches to this Company until the;s9Tositt presented.aritATaceepted at one of its transmitting offices; and if any
Message IS sent to such office by one of this Company's messengers, he acts as the agent of the sender for the purpose of delivering the ines_sage and any notice_or___
it to the Comps:WS *milt in ibiaeld office.
B.
The
JP.y shall not be liable for damages or statutory penalties in any case where the claim is not presented in.writintwithin sixty /aim after the
Wegrain is filed with the Company for transmission.
$43

.

S.

The above terms and conditions shall be binding upon the receiver as well as the sender of this telegram.
NO EMIAOTEE OF THIS COMPANY IS AUTHORIZED TO VARY THE FOREGOING.
CLARENCE H. MACKAY. PRESIDENT.

CHARL(

. ADAMS,
VICE-PRESIDENT.

EDWARD REYNOLDS, VICE-PREST. AND GENERAL MANAGER.

CHARLES P. BRUCH,
VICE-PRESIDENT.

THE FASTEST TELEGRAPH SERVICE IN THE WORLD




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57 East Fifty-Second Street

Feb. 20th (1917)

Dear Gov:

Many thanks for your letter and also for attending to all the
chores at Phoenix.
straightened out.

I will reimburse you as soon as I get my accounts
In the meanwhile, may I trouble you to send me my cap

and ask Miss Andrews if I left some socks and/or golf stockings behind in
your house?

Jerome Greene is back already.

He says he was sick in San Francisco

with vertigo for a few days but did telegraph us that he couldn't join us.
Apparently he got sort of lonely and so came home ahead of time.
Isn't it sad about Funston.

He was a good man.

I am making

myself unpopular at the Bank by telling everyone they're no good.
Jay was in Washington today to arrange for a confidential! handling
of our French matters and telegraphed that he had met with success.

So we

will send the Pallain cable tomorrow.
Treman tells me that Harding said to Aiken recently that he didn't
think there was any use in having Governors' Conferences more than twice a year,
but I am suggesting holding one in March just the same.
Am drafting a very fierce rejoinder to Harding's "condone" letter of
Feb. 6th, but I doubt if I can persuade the rest to stand for it, though I am
violently opposed to leaving the record stand as though we had been in the
wrongjand the Board maligned angels of forgiveness and light.
Doubtless you have seen that Backus has died of mastoiditis in 15
minutes.

Laura sends her love.

Please give mine to your charming daughter

whom I would like to challenge to another game of Parchesi.
Have spent most of my time at Blackwell's Island and the Night
Court since my return, trying to ameliorate the condition of the downtrodden prostitutes.



It's a fine life!
Yrs,

J. F. C.

(CURTIS)

FEDERAL RESERVE BANK
OF NEW YORK
February 21, 1917.

FEB2 G 1917
My dear Governor:

In your letter of December 21, 1916, to Mr. Treman you suggest
that arrangements be made, if they have not already been undertaken, to

have the data which is now submitted at each meeting of the board of directors in the blue binders assembled in periods corresponding to our financial

year, bound in a permanent leather binding with suitable inscription on the
back and with an index which will make the contents readily accessible.
I find that 7r. Jefferson has recently undertaken the binding of

a large quantity of miscellaneous material.which is received periodically
at the bank, such as the daily treasury statements, our weekly reports to
the Federal Reserve Board, the Comptroller's statements, and all of our miscellaneous data that is in any way worth preserving.

In connection with

this he has also made arrangements to have the matters presented to the
directors bound in accordance with your suggestions.
As yoi . probably are aware, the practice in this regard has been,

since the reports have been submitted in formal shape, for the auditor to
certify to the reports submitted at each meeting and for the secretary to
certify that a copy of such reports was presented to each director at the
meeting.

The certified copy is then handed to the auditor at the end of

the meeting and kept by him under seal.

Consequently, when these are bound

up for each year, the volunes will contain complete and certified copies of
all such reports of condition submitted to the directors.




We are having the sane thing done with respect to the reports from

Benjamin Strong, Esq.

FEDERAL RESERVE RANK OF NEW YORK

2/21/17.

the auditor that are submitted to the board, except that I do not certify to

the fact of their submission but that fact now appears in the minutes of every
board meeting, with a sufficiently accurate description of the auditor's report to identify it.

In the old days the minutes only showed that the auditor

submitted a report or reports, without identifying description, but our practice has improved in this regard.

With respect to your suggestion that the contents be indexed, we are
all of opinion that the index would be larger than the report itself and would
be somewhat superfluous, as of course the data is always arranged in the same
order and will appear in the bound volumes chronologically, so there should
be no difficulty in finding any Particular piece of information required.
course, this would not be true with respect to the names of banks for which
rediscounts were made or for the names of makers or indorsers of acceptances

or warrants, but all of these things can be readily found elsewhere in the
bank.

Very truly yours,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colorado.

J20/CEP




Of

FEDERAL RESERVE BANK
OF NEW YORK
February 23, 1917.

My dear Governor:

FEB2 6 1917

On the 21st we sent a cablegram to M. Pallain in your name as follows:

"Your letter December twenty seventh received
Before sending rerly outlining our final and definite proposals we propose to make application to federal
Reserve Board for its consent to our appointing Bank of
France our agent and corresnondent stop
If consent is
granted announcement thereof without stating proposed
terms would be made promptly in newspapers similar to announcement made of authority to appoint Bank of England
stop
7i1l it be agreeable to you to have such announcement made prior to our arriving at a definite understanding of actual terms stop
Please reply Federal Reserve
Bank New York."
stop

to which we received to-day the following reply:
Nous empressons
"Recevons votre telegramne stop
vous repondre que nous serait agreable vous voir prendre
aussitot que possible dans merles conditions que pour Banque
Angleterre initiative de la communication a faire stop
Vous renercions une fois de plus de vos dispositions ami!es meilleurs compliments personnels."
cales stop
which I have translated as follows:

We hasten to re"Your telegram received stop
ply that we would be pleased to have you set in motion the
communication as soon as possible under the same conditions
7e thank you once again
as for the Bank of England stop
ry best personal complifor your friendly actions stop
ments."
As I think you were advised the other day, Mr. Jay went to Washington and obtained an understanding from the Board that such an application

from us with respect to the Bank of France would be acted upon promptly and
favorably and that anyannouncement concerning it would be made only after
advice to us.




This afternoon Mr. Jay called up Mr. Warburg and told him of the

FEDERAL RESERVE BANK OF NEW YORK

0

24t._

Benjamin StroAg, Esq.

2/23/17.

receipt of the cablegram and read him a draft of application which we propose
to send forward, as follows:

"In accordance with the provisions of Paragraph
E of Section 14 of the Federal Reserve Act, the Federal
Reserve Bank of ITew York hereby respectfully makes application for the consent of the Federal Reserve Board to
open and maintain an account with the Banque de France, an
organization established under the laws of the French Republic, having its principal place of business in Paris,
France, and to appoint the said Banque de France its correspondent and to establish the said Banque de France as
its agent in said French Republic, and to open and maintain
a banking account for the said Banque de France."

Mr. Tarburg suggested that we do not forward this letter till tomorrow as
the Board would not act on it on Saturday and he was going to be away and
he would prefer to be present when the application was received, so this will
be mailed some time during the day to-morrow and I will attempt to return
to you with suggestions for changes the draft of the letter embodying our
final proposals to L. Pallain.

Rhoads was in for a little visit this morning but did not have much
that was new to report.

I tackled him on the committee report on Federal re-

serve exchange, which he said simply represented a compromise and was in his
opinion about the best they could have pulled out of the fire at the time.

His personal view still is that the whole thing is unnecessary and that it
would be better not to do anything at

all.

Very truly yours,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.

JFC/CEP




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February 24, 1917.
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My dear Governor:

The draft of the letter and memorandum to be forwarded to the Bank
of France has been given careful consideration by the officers of the bank,
as well as by Messrs. Kent and. Roberts, and we have the following suggestions
to make:
IN T117 777MORANDUM

Paragranh 6, line 2.
Paragraph 8.

Change the word "commission" to "commissions."

The clause which limits the setting aside and earmark-

ing of gold to a time "when rates of exchange will not allow withdrawals without loss to the creditor institution" meets with three criticism as follows:
It is not entirely clear what the word "withdrawals"
will be Interpreted to mean.
It requires the Bank of France to set aside gold on
the assumption that the Federal Reserve Bank of New
York has determined for itself and from its own data
(which cannot be verified by the Bank of France)
that the situation described in the limitation actually exists.
If there should be an active dealing in exchange, it
would be extremely difficult even for the reserve
bank to know exactly whether or not the whole or any
designated portion of its credit balance could be
withdrawn without loss, as of course the francs represented by the balance would have cost varying
amounts of dollars.
Mr. Kent thinks that this phrase
might easily lead to misunderstandings and to suspicions on one side that the other institution was not
playing quite fair.
I have, therefore, drafted a suggested change, which would leave
the paragraph reading as follows:




"The debtor institution, at the request of the
creditor institution, to set aside and earmark gold on
a bullion basis representing balances due, and upon like
request to ship gold in settlement of balances, all as
set out below:

2/24/17.

Benjamin Strong, Esq.

FEDERAL RESERVE BANK OF NEW YORK

"In the case of gold set aside and earmarked,
the same to be separately packed and stored and clearly
identified as to ownership. It should be understood
that the amount of gold or coin to be set aside or earmarked during a given period is to be arranged for by
the creditor institution with the debtor institution as
far in advance of the request as practicable."
Paragraph 11 (a).

7-)e have not been able to establish with finality

the French mint rate and think this matter should be covered carefully in the
letter.

In the meanwhile I would suggest that 11 (a),

(b) and (c) read as

follows:

The Bank of France to earmark and set aside refined
gold bars, nine-tenths fine, for the Federal Reserve
Bank of New York at the FRENCH MINT rate, which we
understand is francs 3437 per kilogram of pure gold,-or

When refined gold bars are not avlIpble, the Bank
of France to earmark and set asidrpnited States gold
coins for account of the Federal Reserve Bank of New
York at their bullion value at a rate equivalent to
the rate of francs 3437 per kilogram of pure gold,-or
(-11(c)

(i)

The Bank of France to earmark and set asidrench
gold coin at its bullion value at a rate equivalent
to the rate of francs 3437 per kilogram of pure gold."

Paragraph 12 (d).

Mr. Kent thinks it would be wise to delay send-

ing the letter until we can arrange for the abrogation of the remelting charge

and thus eliminate the last two sentences, which he feels may upset the French
equanimity.

As you know, we are working on this but have not yet got a de-

finite agreement from the Treasury Department.

If we succeed in getting one

in the next few days, we will telegraph you.
Paragrarh 14, line 2.

'Insert after the word "undertaken" the words

"by either institution for the other."

This will remove any possible misun-

derstanding through errors in translations, which might lead them to believe
that we were binding ourselves with respect to other arrangements with banks
of other nations.




2/24/17.

Benjamin Strong, Esq.

3.

FEDERAL RESERVE BANK OF NEW YORK

If these changes meet with your approval, will you redraft the let-

ter to suit yourself in final form,and for this purpose I enclose herewith some
of our letter paper.
Very truly yours,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.

JFC/CEP
Encs.




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FEDERAL RESERVE BANK

kOF NEW YORK
February 27, 1917.

wiNs3
My dear Governor:

In the matter of the Bank of France we have received word from the

Federal Reserve Board that they have approved our application for permission
to appoint the Bank of France our correspondent and agent and open accounts

with it, both abroad and at home, and have stated that they will make announcement to this effect in the morning papers of Thursday.

We have accordingly

cabled to H. Pallain as follows:

"Greatly pleased to receive your message twenty
We have received from Federal Reserve Board
second stop.
Their
authority to appoint Bank of France our agent stop.
action covers only formal authority to appoint leaving all
Our
details and terms to be agreed upon between us stop.
views and proposals for such agreement go forward by mail
This bank will make no anliwunca.-probably this week stop.
ment until terms have been agreed upon between us but Re-:
serve Board will announce in newspapers March first that
our application for authority to appoint you as agent has
been approved and will quote paragraph E. Section fourteen
of Federal Reserve Act indicating business permitted to
be done through such agency and will state that other Federal reserve banks may participate through us in agency relationship when established."

which, as you will perceive, is intended to reconvey the notion that "all is
not gold that glitters."
I regret that awing to Woodward's absence, his suggestions have not

been incorporated in the redraft of the letter which I sent you on Saturday
but he is going over it to-night and will let me have his views to-morrow.
There is not much else new in this part of the world.

As Mr.

Wickersham remarked to-day, he is prepared to stand behind the President if
he can be sure that he won't get his toes mashed in the process.

However,

confirm
I suppose these subtleynotions indicating a forward progress still
you in your theory of the depth of his understanding.
Benjapin Strong, Esq.,
4100 Montview Boulevard,

pener,

JFC/CEP


Colo.

Yours as ever,

FEDERAL RESERVE BANK
YORK
laSIPIEW

mAR3

1911

February 28, 1917.

Dear Gov:

I enclose herewith a check for :308.50 composed of the following
items:

Loaned

Piping Rock Club bills
and

7fmi r)pir.
lot;
16.35

for all of which nlease accept my grateful thagla.; "

4 104

IIiVPlitatX

I told Mrs. 7cLaren that I did not understand about the Piping
Rock Club bills as Laura and I abandoned the principle of signing your name

down there some while ago and these things should not cone in to bother you.
If you have the slips on which these charges are based, would you be so kind
as to send them on to me so that I can see if somebody is putting one over
on us.

I kAimore than sorry to learn that you caught cold on the trip back
from Phoenix and hope that you are shaking it off in good shape.

T. B. tells me that we were very foolish not to go on to Globe and
especially to the Magna Company's nine, where they have some very interesting
new operations going on.

I am afraid Mr. Cann's nlace will be hard to fill.

Have you any

suggestions as to a successor, either in his capacity of credit man or of
foreign exchange expert.

vverything is very quiet here and you would not know that we are
on the verge of war.

Perhaps we ain't!

I have just received your letter of the 23rd and note that you have

been led to write McAdoo a long letter containing a few modest suggestions, of



FEDERAL RESERVE BANK OF NEW YORK

Benjamin Strong, Esq.

2

2/28/17.

which you have an extra copy for me but don't dare send it until after you
I don't know what production you are refer-

have first read my nroduction.

ring to in this instance, as I haven't promised to advise anybody of anything,
so far as I know.

Please send me the extra copy, as I should like to see if

my ideas as to how to run the Treasury Department are correct.
I am sending you a copy of Maurice Low's "Blockade and Contraband."
I agree with you that it is not very deep.

I think his weakest point is

attempting to justify the blockade of the Baltic ports of Germany against our
commerce but leaving them open to trade with the Scandinavian nations, where

he and Sir Edward Grey attempt to say that the situation is justifiable because
the passage of commerce to a blockaded area across a land frontier or across
an inland sea has never been held to interfere with the ef'.'ectiveness of the
blockade.

This really does not answer the criticism and seems to me a very

foolish form of assertion, in

the

first place comparing the Baltic to an in-

land sea and in the second, attempting to get away from the real proposition,.

which is the blockading of definite ports on the Baltic.

T?owever,

I think

in the main his pamphlet is correct.

I don't think he fails to touch on the subject of the mails for the
reason that yo" probably think he does.

My idea is that there is no real

question of the authority of Great Britain to censor the mails as she does.
The book on the budget, which I promised you, has not yet been published but you shall have a copy as soon as it comes along.
Sincerely yours,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.




FEDERAL RESERVE BANK
OF NEW YORK
BANK OF FRANCE

March 3, 1917.

My dear Governor:

e have just received a letter from M. Pallain, dated February 13,
1917, of which a rough and ready translation is as follows:
'Pear Mr. Strong:

"The French consular agent at Denver has notified me that my letter of December 27th last, to which
I made allusion in my telegram of the 29th, has been
presented to him and that he has not been able to take
delivery and give a discharge to the postal service.
Perhaps the address on it was not sufficiently precise.
In any event the letter has not been returned to me.
"In case you have never received it, I enclose
herewith a copy and ask you to excuse this entirely involuntary delay.
"M. de Neuflize has told us of your expected
return to New York.
I hope very much that you are now
entirely returned to good health and I am very glad over
it.

"Pleasc accept, dear Mr. Strong, my most cordial
sentiments and regards.
(Signed) G. Pallain."

There was also enclosed a copy of the letter of December 27th.
Very truly yours,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.

JFC/CEP



fu/

FEDERAL RESERVE BANK
OF NEW YORK

aff

mAR 1 51917

March 6, 1917.

My dear Governor:

I have your letter of March 2nd with reference to the Bank of France
and beg to reply as follows:

I enclose herewith a memorandum of changes which I would sug-

gest making in the memorandum and also a menorandum of changes which I would
suggest making in your letter to M. Pallain.
As to the various points you have raised, I will summarize
them as follows:




No. 1 on page 1 of your letter you will perceive has
been adopted.

All the points covered in your letter of February 11th to Mr. Treman have been attended to, as

/To. 2.

follows:

Messrs. Roberts and Kent have advisea with
us.

7e are advised that the Bank of France buys
bar gold at francs 3437 per kilo. of pure
gold, which is equivalent to the legal price
of francs 3444.44 less the coinage charge of
francs 7.44, which equals francs 3437.
If
this were translated into a rate for standard French gold coin, it would be francs
3093.3 for one kilogram, as the French gold
coins are supposed to be 90% fine gold and
However, owing to the
10% copper alloy.
process used for mixing the gold and alloy,
it is impossible to have all the coins uniformly 90% fine gold and because of this the
mint allows a limit of tolerance of one onethousandths with respect to the fineness of
Consequently, I would sugthe gold coins.
gest that 'e leave the rate as it was suggested in my letter of February 24, 1917, i. e.
relating only to pure gold.
Changed, as you have already been advised.

LIEMRATZUTI OF SUGGESTED CHANGES IN 11EMORANDUM RE BANK OF FRANCE.

Change last sentence in No. 12 (e) to read:
"French gold coins which are abraded below the
limit of tolerance of 1/10 of 1% for hundred franc pieces
and fifty franc pieces, 2/10 of 1% for twenty franc pieces
and ten franc pieces, and 3/10 of 1% for five franc pieces,
old or gold coin is availare not to be ship,,ed if
able."

%.

Change No. 11(a) by striking out the words "which we understand is"
and substituting therefor the word "of."

Change paragraph 8 by making a period after the word "ownership"
and a new sentence immediately-following.

Place at the end of the last

sentence a semi-colon with the following:

"And in general the amount of obligation payable in gold, which may be incurred at any one time by
one institution in favor of the other, is to be limited
as stated in paragraph 16 below."

,7




Omit the last sentence of paragraph 21.
Insert 4 new paragraph after 19, as follows:
"Each institution agrees to waive the benefit
of any moratorium or other law now or hereafter existing, which might prevent or delay the carrying out of
any of the obligations of this contract."

at

7EMORAIMU1t OF SUGGESTED CHANGES IN LETTER TO M. PALLAIN.

Page 1, last line.

Change "confirmation" to "confirmations."

End

9f
the sentence with the word "herewith," and add the following sentence,i

"Nattrally we are delighted that we have received
official authorization from the Federal Reserve Board to
proceed with these negotiations to a conclusion."
Page 2.

Page
consent."

Strike out the first line.

3, lines 9 and 10.

Strike ant the words "with the government's

Change the next sentence to read as follows:
"However, should our information be incorrect
and should the exportation of gold require the assent of
your government, I assume that it will be necessary to
obtain the government's assent to our proposed arrangement which contemplates the settlement of the account by
exportations of gold under certain contingencies."

Add at the end of the letter a clause stating that our figures concerning the mint rate for gold bars and gold coins and the French limit of
tolerance are in accordance with advices received in this country and if they
are not cor-ect, they should be changed in the memorandum of agreement.




FEDERAL RESERVE SANK OF NEW YORK

Benjamin Strong, Esq.

3/6/17.

The French limit of tolerance has been investigated and is covered in memorandum and letter.
Same as to French law on gold exports.
77e have confirmed your understanding that
French gold coins are 90% fine gold and 10%
copper alloy.

Covered by suggested changes in letter and
memorandum.
Same as (7).

Mr. Jay submitted the details of the pro'Your No. 5)
posed arrangement with the Bank of France to Mr. Warburg
individually after the Board had approved our application
for permission to appoint the bank our agent, and with
the understanding that the draft of memorandum would not
In fact it was returned
go on the files of the Board.
by Mr. Warburg under date of March 2nd with a letter in
which he said that without submitting the matter formally to his colleagues he had given them an opportunity
individually to look it over, and neither they nor he
had any comment to make, and that the memorandum appeared
He also added, not
satisfactorily to cover the case.
by way of criticism, that he did not quite understand
why broad emphasis -should be laid upon French bills drawn
or indorsed by American firms and vice versa dollar bills
on America drawn by French firms, and I understand Mr.
Jay has given him an explanation of the underlying thoughts
in this connection.
As to whether the Assay Office can be persuaded to waive
the 500 charge for bars, I cannot say, but I think we
should send the letter and memorandum forward even with
You have doubtthis troublesome point left undecided.
less seen Mr. Jay's letter of March 3rd to Secretary
McAdoo, but '1 doubt if we get a reply to it for at least a
couple of weeks.
)

Your other suggestions, covered by your Nos. 8-14 inclusive,
will receive attention in due course.

I trust that this sufficiently covers the situation.
hesitate to fire when ready.
Yours sincerely,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.




If not, do not




POSTAL TELEGRAPH
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CRAMMER BUILDING

17TH STREET

DENVER. COLO.

TELEPHONE: MAIN 4500

COMMERCIAL CABLES

CLARENCE H. MACKAY PRESIDENT.

TELEGRAM

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180-29m8

495-chho

88

OMNI PATENT SA ANWIN

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cb New York

mar

7-17

Benj Strong
4100 Montview Blvd
Denver Colo
Your letter march third and enclosures received we note paragraph eleven
D states abraded coin are not to be earmarked or shipped if other gold
or coin is available whereas paragraph twelve E states abraded coin are
not to be shipped stop Is omission of word earmarked in twelve E
intentional or shall we insert it stop Same divergence appears in our

English letter stop Shall we include a paragraph mutually waiving
benefit of future moratoriums stop We are advised existing moratorium
3 F Curtis,
does not apply please wire answer.

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transmission, and an additional sum paid or agreed to be paid based on such value equal to one-tenth of one per cent. thereof.

S. The Company L3 hereby meide the agetit Of the sender, without lia7blltty, to forward this telegram over the linee of
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4. Messages will be delivered free within the established free delivery limits of the terminal office. For delivery at
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7.

The above terms and conditions shall be binding upon the receiver as well as the sender of this telegram.
& NO EMPLOYEE-OF-THIS COMPANY IS AUTHORIZED TO VARY. THE FOREGOING.
..... ADAMS,
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CLARENCE H. MACKAY, PRESIDENT
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FEDERAL RESERVE BANK
OF NEW YORK
rch 16, 1917.

My dear Governor:

I enclose herewith a draft of a letter Which has been prepared
in the bank, after considerable conversation to-day and yesterday with 7::r.

Warburg, who was here.

It presents a comrosite of his views and those of

Messrs. Trenan, Jay, Peabody and myself.

You will obser

omitted -os. 5 and 6 of your draft, as we were not quite clear what the
scope of the suggestions might be considered to be by the Banco de la Nacion
Argentina, nor exactly what advantages would accrue from including then.

Possibly, if necessary, they could be taken up at a later time in the negotiations, if you think they are important.

We have also added a qualification to your No. 2 in order to make
clear that we do not wish to compete with the commercial banks in ordinary
commercial transactions.

That would you think of omitting Ito. 2 entirely

and merely suggesting the possibility of handling items for collection and
thus open the subject up-for discussion, without making any tentative offer?
As to No. 3 (e), further consideration would seem to indicate that
this ought to be in the nature of a general remark pnd not be a subdision
of No. 3;

also that perhaps we should not offer to take custody of gold for

a consideration, unless we make the offer as a separate suggestion to go
into effect only if the general reciprocal and mutual arrangements are not
entered into.

As to No. 4, T1r. Warburg's thought seems to be that the principal

profitable exchange business for our member bank branches in the Argentine

will consist of arranging credits and getting the commissions, rather than



..ERVE BANK OF NEW YORK

Benjamin Strong, Esq.

in purchasing bills of exchange, and consequently that we could go into the

exchange market and buy long bills there without creating competitive conditions.

In fact, he thinks that the public knowledge that "dollar exchange"

was eligible for purchase by our Federal reserve banks and would be purchased
there by them on occasions, when necessary, would assist our member bank
branches in establishing dollar exchange.

He felt, however, that we would,

of course, use this judiciously and only when fair rates were not readily
obtainable in the Argentine for dollar drafts.

With respect to the mutual indorsement of the bills purchased, we
are wondering what your views are as to whether we would ever be required to
purchase bills here for the Argentine bank, and if so, what kind of bills.
In other words, would this requirement of our indorsement ever place us in an
embarrassing positionl
You will note that we have toned down somewhat the restrictive language of No. 4 by striking out the word "emergency," but to offset this we

have inserted that the transactions in question should only be undertaken
when both institutions are of opinion that the international situation between
the two countries requires some action.

As Mr. rarburg feels a little sensitive over the amount of time
which has elapsed since his first suggestions to us were made, we would like
to get your reactions upon this draft at the earliest possible moment, by
Wednesday next if that is practicable, when we hope to have an executive committee meeting.

Please excuse the somewhat sketchy form in which the draft is sent
you, which is caused by our desire to save time.

We would hope to be in a position to make up final letter after getting your views.

VerY truly yours,
Benjamin Strong, Esq.,
4100 Montview Boulevard,
http://fraser.stlouisfed.org/
717R, COLO.
Federal Reserve Bank of 90pp
St. Louis

Pyle.

FEDERAL RESERVE BANK
OF NEW YORK

Wrir.
CONFIDENTLAI

wip,o t

My dear Governor:

1911

V.7,1:_.!NO1

7?,DErtAt

'DEPT.
411

March 17, 1917.

tittrtAlt D.Og

There are a variety of matters which you probably would like to hear
about which have been lying fallow for some while.
In the first place, on the question of reorganizing the efforts of
the officers of the bank I enclose herewith a memorandum which I have given to Messrs. Treman and Jay with the hope that we may possibly reform ourselves.
I have been very anxious to get at this matter but the opportune time never
seems to arrive, which, as you know, is one of the things which need most to
be reformed.

However, I expect next week, after the governors' committee on

Federal reserve drafts has completed its labors, we can sit down and thrash
this matter out.

Ir. Jay has handed me your letter of March 2nd with reference to the
way in which the gold bar proposition has been neglected, and I am preparing a
report on this matter attempting to distribute praise and blame in an impartial
manner.

So far I have found no praise to be distributed.

I think it is a

case where you would be justified in enjoying a complete loss of td.me and doubtless you have already had that pleasure.
iN

I would like to get your reaction on the board's recent recantation
of its French and English Treasury bill pronunciamento of last November.

It

seems as though they had now reversed their position completely under the guise
of claiming that the public had misunderstood them.

Joe Cotton told me yester-

day, however, very confidentially that he was informed by a very "high" democrat

close


to the administration as positive truth that the President himself had

-2

The system which in practice prevails, although known to be opposed
to the theory of the office, is that the time of the other officers with whom
a given one is conferring is less important than the time of the individual
calling by telephone or in person.

The senior officers do not organize their work so that the routine is disposed of early in the day and by a given time.
The officers have not a proper "Concept of selective values."
In other words, too great a proportion of their time is taken up with matters
of comparative insignificance.

The decisions reached by the senior officers with respect to
the policy to govern detail operations of the bank should be transmitted through
the cashier, with written memoranda, to the other officers interested.

The circulating letterbook, containing copies of letters sent
out the preceding day, should circulate.

The only way in which I see this book, nine times out of ten, is by
sending especially for it.

The remedy suggested is to make the reading of

the book a necessary preliminary to the

 JFC/CEP


day's

work of each officer.

FEDERAL RESERVE BANK OF NEW YORK

Benjamin Strong, Esq.,

2

3/17/17.

written or inspired that utterance of the board's, which, if true, might account
for some of the subsequent squirmings.
source of his information;

Joe says he believes it awing to the

and, of course, there is this point to be consider-

ed - that Davison, I believe, had an interview with the President just before
his interview with the board, so possibly there is something in it.

With respect to the Banco de la Nacion Argentina matter, I am at a
slight loss to understand the sudden turnabout of my associates.

On February

27th our executive committee voted that, in view of existing international situations, it was inadvisable at the present time to take up negotiations with banks
in countries other than England and France.
rectors approved this action.

On February 28th our board of di-

However, the day before yesterday Mr. Warburg

came to the office and was very anxious for negotiations to be begun with the

Argentine and when I arrived at the conference I found everybody agreed that we
must get a letter right off to them, apparently because 1. had felt hurt in his
feelings that we had not taken any speedier action.

I told Mr. Treman to re-

mind him that our application for permission to appoint the Bank of England our
agent had lain at the Federal Reserve Board's office unacted upon from August
29th till December 25th and that, in view of this delay, six weeks Consideration
of the Argentine matter, concerning which you and he were in such disaccord on
one of the principal points, did not seem to me very serious.

However, we now

seem to be engaged in bustling off a letter to the Argentine in spite of my
efforts to have it delayed until it can be well considered, especially by yourself.

We are calling an executive committee meeting for Wednesday to go over

this matter, although I doubt if we can have your reply by that date.
As far as I can make out after talking somewhat fully with 'Ir. Warburg,

your views and his on the Argentine proposals are not quite so divergent as they
appear at first sight.

ris

idea, apparently, is not so much to have the bills

purchased there for our account as a regular thing but to establish the fact

that we


are ready to purchase them at a fair rate and thus, not only assist in

3 _

DERAL RESERVE BANK OF NEW YORK

3/17/17.

Benjamin Strong, Esq.,

establishing a stable market but also in getting away from the situation where
the agencies of our member banks deal in their own acceptances.

If we could

phrase this proposal in such a way as to tie it down to approximately that sug7estion, I think it might be all right.

I urged that we ask the member banks

in question (both the City Bank and the First National of Boston) how they would
feel about it, but Mr. Warburg thinks this would be inadvisable, although he
bases his argument on the statement of what he thinks would be for the advantage
of the member banks.

It seems to me that the easiest way to find out what

their feelings of their advantages are is to ask them, and I hope we shall do
this before the letter actually goes forward.

What do you think of the Russian upheaval?

It looks as thougA it

was a great thing for the Allies and the cause of democracy generally.
The President seems to be reaping, or rather the country is, the results of his surrender of last summer.
Yours sincerely,

Benjamin Strong, Esq.,
4100 Montview Boulevard;
Denver, Colorado.

JFC/PE
IrInc




=torten= OF Direrms IN BM .0jtGATTIM'ION
CONFI1VNTWe

1.

There is a leek of proper distrnution of functions among the

officers.
nth the exoeption of matters similar to applications under the
Clayton Act, the issue of Federal reserve notes and other activities which are
by law placed upon the Federal reserve agent, there is practically no subJect
in connection with the operation of the bank which is not from tine to tine

'handled by all the senior officers.

Take as an exariple the following:

The sale of French gold coin. On this natter work
was being done simultaneously by ressrs. Treman,

Jay, Curtis, 9aller and 7iggins.

Investigation of best method of obtaining gold bars.
ork has been done on this natter simultaneously
by Mesere, Trenun, Jay, Certin and Cann.

(0)

Investigation of method adonted by lank of ?ranee in
nUrchasine gold coins and bars.
done on this rlatter simultaneously by 7essrs. Treman,
Jay, Curtis, If/J.1er, Cann and Crane.

(d) Method for inaugurating Federal reserve bank drafts.

work has been dome on this eimultareOusly by 1.1essrs.
'fireman, 'Jay, Woodward, Curtis and Yendricks.

2.

There is no method or system by which any particular matter

will be automatically referred to any particular officer.
3.

The senior officers de not delegate enough of their work to

the junior officers.
4.

!Then work or powers are delegated, they should be delegated

with finality and the person to whom delegated should be held responsible for

results..
5.

Conferences between the senior officers, as well as conferences

between all officers, are remitted to be interrupted.



(e) By telephone calls,
1. 6,4 °is/ tos2S

FEDERAL RESERVE BANK
OF NEW YORK
March 20, 1917.

My dear Governor:

I have your letter of the 15th with reference to the Bank of France

communication, and note your difficulties in fitting in the language used with
the correspondence apparently at hand.

You show a keen analytical sense and highly developed powers of deduction in the second sentence of your letter, in which you state that apparently the changes mentioned in my letter of the 6th, with the accompanying
memoranda, could not have referred to the signed conies which you mailed to
the bank on the 2nd.

My letter is all very true.
This of the 6th had re-

ference to your draft of letter to M. Pallain and memorandum of agreement
which accompanied your letter to 'Er. Treman of February 11, 1917, forwarded
from Phoenix, Ariz., and consequently all of the references are to those
documents.

This letter Of mine was mailed on March 6th.
of the final letter to M. Pallain and memorandum of agreement, which you say

in yours of the 15th you mailed to the bank on March 2nd, appear to have been
accompanied by a letter from you dated March 3rd, and in any event did not

reach the bank until March 7th, just after my letter of the 6th had gone forward.
As Practically all of the sugc-estions that I made on the 6th had

already been incorporated in your signed redraft, which accomnanied yours of
the 3rd, we adopted your letter and memorandum as it was, with only the
slight changes that I think have already been indicated to you by telegraph

and otherwise.


If you have retained, as I assume you have, a copy of your

FEDERAL RESERVE BANK OF NEW YORK

2.

Benjamin Strong, Esq.

3/20/17.

letter to M. Pallain, dated March 5, 1917, and marked "Registered," you will

find that that is an exact copy of what was forwarded to him on the "Rochambeau"
through the French Embassy pouch and on the "Monterey" by registered mail, except that at the end of the letter, on the bottom of page. 4, the following was
added:

We are advised that the French limit
of tolerance upon abraded French coins is 1/10 of )(7, for
one hundred franc pieces and fifty franc pieces, 2/10
of 1% for twenty franc pieces and ten franc nieces, and
If our advices are
3/10 of 1% for five franc pieces.
incorrect, paragraph 12 (e) should be changed in order
to include a correct statement of what the limit of tolerance is."
"P. S.

If you have preserved a copy of the memorandum marked "Confidential"

and entitled "Memorandum of terms and conditions suggested to apply to proposed relations between the Federal Reserve Bank of New York and the Banque de
France," which accompanied the aforesaid letter addressed to M. Pallain, you

will find it is an exact copy of what went forward to him by the two methods
of communication above set forth, with the following exceptions:

On page 4 of your memorandum, on line 5, the word
"gold" has been inserted between the words "or"
and "coin" making that line read "or shipped if
other gold or gold coin is available."
On page 5, line 6, the words "earmarked or" have
been inserted between the words "be" and "shipped,"
making the line read 'which are abraded below the
French limit of tolerance not to be earmarked or
shipped."
I hope this straightens out all your difficulties.
Very truly yours'

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colorado.

JFC/CEP
Ii




Form 1201

UNION

1- CLASS OF SERVICE SYN ')L
Message

utter

...Mit Message

Nito

AM

N I_
Night Letter
If no
of these three symbols
fter the check number of
appe

symbol a npearing after the check.

Day Message

NEWCOMB CARLTON, PRESIDcNT

Day Letter

Blue

Night Message

Blue

a day message. Otherword
wise ifs character is indicated by the

CLASS OF SERVICE SYMBOL

Rite

NL
If none of these three symbols
Night Letter

appears after the check number of
words)this is a day message. Otherwise its character is indicated by the
symbol appearing atter the cheek.

GEORGE W. E. ATKINS, FIRST VICE,RESIDENT

RECEIVED AT 915-919 SEVENTEENTH ST., DENVER, COLO. ALWAYS

B18 NY CP 118 NL

-

t

NEWYORK MAR 22 1917

BENJAMIN

STROALI3.4.47A/

11.1

410-i) MONTVIEW BOULEVARD DENVtRtOter---

REPLYING YOUR TELEGRAM ON ENGLISH

SIX

IT SEEMS INADVISABLE TO

be.22ii/J

0

MEMO TAKE FOLLOWING SUGGESTIONS CHANGE

OPENING SENTENCE AND PARAGRAPH TWELVE
OF WAR AND SUBSTITUTING A

o.\,

_\_

i3.

BY OMITTING REFERENCE TO CONCLUSION

DATE TO BE MUTUALLY AGREED

UPON STOP PARAGRAPH

HAVE EARMARKING GOLD DONE ONLY

CONVENIENCE OF DEBTOR INSTITUTION INSTEAD

AT

OF A REQUEST OF CREDITOR
SAME

UNDER A GENERAL UNDERSTANDING AS

TO AMOUNTS STOP PARAGRAPH TEN

SUGGESTION AS ABOVE WITH RESPECT

TO WORD VOLUNTARY STOP PARAGRAPH

TWELVE UNLIOUIDATED BALANCES SHOULD BE

SETTLED IN GOLD IN ANY

EVENT

ND NOT QUOTE IF SO AGREED END QUOTE STOP OTHERWISE CHANGES SEEMS
REASONABLE STOP WE WILL USE
CUNLIFFES LETTER AS ADDITIONAL ARGUMENT






Form 1201

- VVESTE
TEL
BOL

Blue

4iNsuN

Nite

UNION

WESTERN UNION

11&" vtifir )1!

NI

throe symbols
heck number of
.

nessage. Other.er ks indicated by the

app

ring after the check.

NEWCOMB CARLTON, PRESIDENT

CLASS OF SERVICE SYMBOL
Day Message
Blue

Night Message

AM

Day Letter

Nite

NL
If none of these three symbols
Night Letter

appears after the check number of

GEORGE W. E. ATKINS. FIRST VICE-PRESIDENT

words) this is a day message. Otherwise its character is indicated by the

symbol appearing after the cheek.

CE

.IVED AT 915-919 SEVENTEENTH ST., DENVER, COLO. =Zs

Ei18 NY, CP SHEET 2

TO OBTAIN WAIVER OF ASSAY

OFFICE CHARGE FROM TREASURY DEPARTMENT

J F CURTIS

Po,
MAR 23 130AM
B;(7/6e_J




FEDERAL RESERVE BANK
OF NEW YORK

APR2

191/

March 28, 1917.

My dear Governor:

I give below copy of a cablegram just received
from Lord Ounliffe, which seems very satisfactory:
"Answering your cable agree
in principle to your three suggestions
as we here understand them and beg you
to mail proposals for consideration.
If you have any suggestions as to phraseology to be used
in the final draft of the proposal, please send them on
without delay.
Very truly yours,

' enjamin Strong, Esq.,
4100 TIontview Boulevard,
Denver, Colo.

JFC/CEP




FEDERAL RESERVE BANK
OF NEW YORK

March 26, 1917.

MAR2 9 1917

My dear Governor:

I meant to write you a long letter to-day also yesterday, and possibly the day before - but haven't
seemed to get around to it.

I enclose herewith a copy of cablegram which is

going forward this afternoon to Lord Cunliffe and hope you
approve.

Yours sincerely,

Benjamin Strong, Esq.,
410n Montview Boulevard,
Denver, Colo.

JFC/CEP
Enc.




FEDERAL RESERVE BANK
OF NEW YORK

-arch 30, 1917.

y dear Governor:

I enclose herewith the changes which we are

proposing to suggest to Lord Cunliffe in the final
draft of the memorandum of agreement.

-ill you please telegraph if this language
meets with your approval.

If it does not, please tele-

graph any additional suggestions.
Very truly yours,

Benjamin Strong; Esq.,
4100 lIontview Boulevard,
Denver, Colo.

J3C/CEP
Fnc.

Change opening paragraph to read as follows:

The following points confidentially and tentatively agreed upon for
submission and ratification by the respective institutions with a view to being put into operation when mutually convenient:/-0(

t

(railw-s
6.

GOLD.

:

Subject to such limitations as may have been agreed

upon under the provisions of clause 10, and as below stated, the debtor institution will, at the request of the creditor institution, set aside and earmark gold on po,,,0 ,bullion basis representing balances due, such gold to be

clearly identified as to ownership.

dac,r,izt / 0

"8

Iree0-7-v-r :

10.

The intention of the arrangement is that all transactions in

gold (other than earmarked gold) between the two institutions shall be upon
exactly equal terms as to each, provided that either party nay limit the amount
of its obligation to earmark and set aside gold,and/or to settle its debit
balances in goldlto definite amounts for definite periods,in advance.

In

the absence of the establishment of any such limitation, all balances shall
be settled in gold, if desired by the creditor institution.
/2.

a_4( vqp-e6r,,x
12.

This arrangement is to be subject to cancelation by either

institution, in whole or in part, except as to transactions in process, on
notice by letter or cable;

it being understood that subject to

tions as may have been agreed upon under the provisions of clause 10, any
unliquidated balance either way will be settled in gold, if desired by the
creditor institution.




FEDERAL RESERVE BANK
OF NEW YORK
4,01

ot,: 191744.

CONFIDPNTIAL

t
6F;Y;11117.

My dear Governor:

I enclose herewith a copy of the programme for the governors'
conference to be held on April 4th in Washington.

If you have any sug-

This programme has been somewhat.

gestions to make, please let me know.
hastily arranged owing to lack of time.

You will note 17o. 15, Foreign Arrangements.

My view is that

the. time has arrived for us to tell the governors the exact status of our

various foreign proposals, giving them copies of the agreements that are
in process of negotiation, with the request that they obtain from their
boards of directors authorization to advise us whether,

and if so for how

much, they desire to go into the proposed transactions.

r!e have got to

make the plans Some time and it seems to me that our arrangements are now
so near completion that we night as well take the others into our.confidence, even though it includes having 144 people know the exact terms of
the proposed contracts.

Of course, it would be done under a stri8t

nledge of secrecy and confidence.

'Till

you let me know whether you think

this is wise and if not, what you would suggest in its place.
I understand that 17r. Trenan has already written you fully about
the 2

ninety-day certificates of indebtedness, which Mr. Mei:do° wished

upon us.

Our board of directors, while desiring to comply with the re-

quest of the Government, felt very strongly that this was not a proper.way
to have the financing done and agreed to so exnress itself in a preamble
and resolution.



I enclose herewith what night technically be called the

...YERAL RESERVE BANK OF NEW YORK

2

Benjamin Stron7, Esq.

3/30/17.

rake's progress, indicating the various forms in Which this resolution evoluted from the somewhat snappy and straight from the shoulder legal form of
7r. Locke through the various stages of diplomacy and smoothness, as shown
by its final rhythmic measure.

I think the point

to make is pretty well set forth in language that will not tend to rile the
Secretary unnecessarily, but I believe it was very necessary to make the
point, especially in view of the fact that the newspapers seem to indicate
that we are to be asked to subscribe to

50,000,000. more in a

I have your letters. of March 15th, 21st and 26th, none of which
have I answered.

In the matter of handling the gold bars, I have completed my labors

and made a report which has been handed to Messrs. Trenan and Jay, and of
46-4vFl-

I:very day we are proposing to get at this

matter, as well as the general reorganization of the office and the functions
of its personnel, but we haven't yet got around to having any definite results
in this regard.

The Bank of

ngland matter seems to be moving very smoothly and by

the end of the week I think we ought to be able to put all counter proposals
in definite form for going forward-

I have been spending a little time running down the contract which
77essrs. A. Iselin & Company have made with the Carranza government for the

purchase of gold and having it coined at the Philadelphia Mint to the extent




of "!'10,000,000. worth, which we were asked to look up by our friends in Wash-

ington owing to the fact that a man named Stallforth was mixed up in the
transaction.

Stallforth is a German who was in with Rantelen on some of

the passport frauds and other German activities over here.

However,

-7rnest Iselin tells me Stallforth has really very little to do with this mat-

ter, their principal outside negotiator being a man named Osterheld.

,..7,DERAL. RESERVE BANK OF NEW YORK




3

Benjamin Strong, Esq.

3/30/17

If you know anything about these men or this proposition, let me know.

have man then down pretty well here and think I know the scope of their activities fairly closely.

As Iselin & Company keep complete control as to the

disposition of the money when minted, I think the

transaction is perfectly

safe.

Sincerely yours

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colorado.

(

4,66.4

(,4-6(1.
()&

JFC/CEP
","ncs.




FEDERAL RESERVE BANK
OF NEW YORK

March

l, 1917.

ceived from J. F. Curtis, Counsel o

the

Federal Reserve Bank of New York, a document purporting
to be the minutes of a meeting of the Executive Committee
of the National Industrial Peace Conference held in the
City of Washington on July 31, 1915, with the signatures
indorsed thereon of H. Robert Fowler, Chairman, and H. B.
Martin, Secretary;

to be returned upon request.




Executive

The luaileg.Ifinciel committee elected at the convention of the

National Industrial Peace Conference held in the City of Washington on
July 31st, 1915, at which were present the representatives and delegates
of the Farmers' National Grange, National Society of E4uity, National
Farmers' Union, including five million organized farmers, and delegates
re-presenting the central labor bodies of the principal cities in the

United States, comprising two and one-half million members, in pursuance
of the instructions contained in the resolution of the National Industri-

al

Peace Conference creating the Committee, and acting under authority

therein conferred, does hereby make the following report and recommendations:

Continuance of the -European war means a most tremendous catastrophe to civilization and humanity.

The best energies and efforts of all should be exerted to stop
it immediately.

The war is being kept alive to-day only by the United

States pouring in on a transcendently great scale all its resources in
and
money, war supplies, food, clothing, transport animals /vessels.

All this is being done at the behest of the overlords of the
great criminal trusts which for years have afflicted the country.

To break the strangle hold of these vultures and bloodsuckers

upon the financial resources of themuntry, and to destroy their malign
influence, now forcing our people day by day along the bloody path of
slaughter and desolution, will require direct action by the people at
large.

PRES= CONDITIONS
The committee has absolutely convincing proof that a group of
men now in control of the great trusts' conspiracies, headed by members ofthefirm

of J. P. Morgan & Company, who are and have been for years past robbing
the people of this country of several millions of dollars a day, are in
possession of contracts for war materials and supplies of various kinds
from the governments of Great Britain, France and Russia, on a scale so
transcendently enormous as to guarantee to the contract mongers a profit
of more than four hundred millions of dollars, and that in return for
these contracts and the profits flowing from them, the masters of the
great trusts' conspiracies have entered into undertakings to obtain loans

of money from the banks of the Federal Reserve System for account of
1-eat Britain and her allies, to the amount of, at least, a billion and




a half dollars.

By various devices and juggles these contract mongers have

already extracted from the banks in the Federal Reserve System more than
five hundred million dollars, and are now making sedulous efforts to

secure immediately, at least, an equal additional amount from the national
banks embraced in the Federal Reserve System.
The Federal Reserve Board, Sei3e#ay-4).4".-414e-ga,eagiapy-a144-Gem-

t,vol;44-4) -411(4-41,1,pPRey not only refuse to put a stop to these transactions, but a.11-4)-f-44em exhibit a willingness to allow the entire money

and credit resources of the banks in the Federal Reserve System to be

used without limit in furnishing money for use in buying munitions and
supplies by which the European war is fed and kept alive.

The Federal Reserve System was designed and organized by Congress for the express purpose of destroying the Morgan money trust power.

Nevertheless, this same sinister power still exercises an effective control over the moneys and credit resources of the people, as embraced in
the Federal Reserve System.

Complete evidence of this may be found in the conditions which
obtain in the Federal Reserve Bank of New York.

The Governor

institution is Benjamin Strong, Jr., who up to the time of his election
as such was President of the Bankers Trust Company-of New York.

This

concern, with resources of '210,000,000. is a citadel of the Morgan
money power, and no man could be its president except he did the absolute
bidding of Morgan and his allies.

Before the Congressional Committee investigating the money

trust H. P. Davison, a member of Morgan & Company, testified that the
Bankers Trust Company was controlled by a voting trust managed by Morgan
& Company.

That the Morgan money trust power completely dominates the
Federal Reserve System to-day is well evidenced by the fact that a man
like Strong got to be governor of a Federal reserve bank holding onehalf of the total moneys of the system.

Since the beginning of the present European war there has been
added to the public debts of the European governments the sum of over
twenty-five billion

4

dollars, and this debt is increasing at the rate

of seventy million dollars each day, a condition that spells but one

-3-

result - bankruptcy of the warring European nations, and, as things

now are, the bankruptcy of the institutions in the Federal Reserve System in the United States, because the proceedings of Morgan and those
acting with him now being carried on with full concurrence of the officers of the Government, will create a condition in the national banks

and the Federal reserve banks resulting in these institutuons having
practically their entire lending resources tied up in loans to agents

of European governments, whose bankruptcy past inevitably occur in the
very near future.

A high principle of international law forbids a neutral coun-

try from furnishing in time of war aid in money to belligerent governments.

Should the present policy of the banks in the Federal Reserve

System be continued such conditions will inevitably subject the United
States to the payment of an enormous indemnity of probably more than a
thousand million dollars.

Certainly should the question of such an in-

demnity be referred to an international court of arbitration the decision
would be adverse to the United States, largely because of the contentions
advanced by our own government in the Alabama case following the Civil
War, which were upheld by the international arbitration court, and, at
the instance of our own government, written into the body of international
law.

The foregoing constitute a truthful statement of conditions as
they are and of what the country may look forward to if the money trust

power is permitted to continue in their foul work of feeding and keeping
alive the European War.

The people of this country, peace loving and animated by an
all-pervading desire to keep this country out of war and see our nation
take the load in bringing peace to the war distracted nations of Europe,

are confronted with the necessity of striking directly at the heart and
eourse of the one great influence and power which aims to defeat these
Purposes.

By direct action of the people alone can the money trust power
exerted over the banks in the Federal Reserve System an4-144'e-41asupaRag
eQw13a144es
be destroyed.




The accomplishment of such a task would be a

Jerk great in fruitful good to humanity and civilization.
The National banks in the Federal Reserve System are using

0

your money deposited in their hands to enable the warring European
governments to purchase in this country munitions of war, which kill
each day many thousands of human beings.

You can stop this at once

and see to it that the moneys of the people deposited in banks are

applied to benign and peaceful purposes for the benefit of the masses
of the people.

The most crying need of the day in this regard is the furnishing and creation in each State of a rural credit system, by which the

farmer may obtain from banks operated under state charters loans upon
reasonable and fair terms, the objedt of such loans being to facilitate
and encourage a healthy increase in farm ownership and production,

thereby cheapening the cost of living and encouraging a very great legitimate interest.

This committee recommends as follows:
TO ALL AMERICANS, REGARDLESS OF SECTION OR PARTY, -WHO
DESIRE TO END THE PRESENT WAR IN EUROPE AND :::,.1,11TAIIT AN HONORABLE PEACE

WITH ALL NATIONS THROUGH THE FIRM AND IMPARTIAL MTFOROMENT OF OUR
EXISTING NEUTRALITY LAWS:
You are advised to immediately take the following action:

Withdraw any personal deposit you may now have in a national
bank, and redeposit same in a bank operating under state charter, whose

officers will pledge themselves to remain free from any affiliation with
war mongers or their undertakings.

Revest the officers of your savings bank to withdraw any savings bank moneys on deposit with a national bank and redeposit same in
some solvent bank operating under state charter, whose officers will
pledge themselves as indicated herein.

Communicate personally or by letter with your City, County, and
State Treasurer, requesting each of these officers to draw out any moneys
now on deposit with a national bank and redeposit same in some solvent
bank operating under state charter, whose officers will give a pledge as
herein indicated.

Resolutions adopted at the National Convention of the Farmers'
Union at Lincoln, Neb., Sept. 9, 1915:

Whereas the Wall Street banking agents of warring European powers
are securing the aid of Federal reserve banks throughout the United States
to .help them finance loans of hundreds of millions of dollars to these






-5-

nearly bankrupt belligerent governments, in gross violation of international law and involving the peril of the most disastrous financial panic
and loss for this country;

and whereas this is a warning to our people

of the gravest danger to the financial safety of the United States and a

gravely added danger of involving our country in the European war, and
whereas the glaring contrast afforded by this Federal Reserve System proposing to loan 500 million dollars to wild war speculation and a poor 30
million dollars to move the billion dollar 'cotton crop of the South, is

so striking that it must be clear to all that this Federal Reserve Bank
System as now organized furnishes no equitable aid-to the farmers.

There-

fore to the end that we may cause the early adoption of a better and more
equitable system;

Resolved that we recommend that the vast body of our people who
favor peace and who need this money here in the United States for handling the legitimate business of Agriculture and Commerce, should transfer their deposits from Federal Reserve System banks to state banks who

will pledge themselves to allow none of the banks' or the depositors'
money to be used in the unlawful and most dangerous business of financing
foreign wars between other nations.
'Resolved that we empower and direct our national officers and

national executive committee to confer and cooperate with the committees
of the Uational Industrial Peace Council, and the various other agricultural, industrial, reform and business organizations of the United States

who favor keeping the United States out of war and bringing the calamitous war in Europe to an early close;

with a view to devising the most

effective means of quickly ending the war and securing a universal permanent peace.

Resolved that we hereby recommend that all friends of peace
oppose the election to the office of President, Vice-President, Senator
or Representative of the United,States any candidate 174ho refuses to vote

and pledge himself for the Government ownership exclusively of all arms

and munitions works and forever put an end to private profit in the makIng of any of the instrumentalities of war within the United States.

.

RF

FEDERAL RESERVE BANK
OF NEW YORK

March 31, 1917.

Dear Gov:

As you are possibly not a subscriber to that estimable
sheet now run by 77r. prank A. NUnsey, I take pleasure in enclosing

herewith copy of an article appearing in to-day's issue, and invite your particular attention to the parentage of the plan for
annointing the Banksof rngland and France representatives of the

deralBeserve System.
In connection with the trial of Messrs. Buchanan, Monett,
Fowler, -artin, et al.. I had a chat with United States Attorney
-71-shal1 the other day, who has asked us to let him have the signed

copy of the minutes of the meeting of the executive cmmlittee of
the National Industrial Committee's conference, which I am accordingly doing.

This trial is set for Anril 16th and I believe ought

to be one of the most important of the trials against the pro-German
sympathizers.
Sincerely yours,

Benjamin Strong, "sq.,
4100 Montview Boulevard,
Denver, Colo.

JPc/c117,







FEDERAL RESERVE BANK
OF NEW YORK

April 3, 1917.

APR9

1917

Dear Governor:

I enclose herewith a copy of the final draft of
letter to the President of the Banco de la :Taejon Argentina,

-hich I understand T7r. Trenan is signing and sending forward to-day, accompanied by a Spanish translation which !Ir.

Warburg has had made.

The latter is

letter to Mr. De Iriondo, which will go forward at the
sane time.

I hone that the restrictions placed about Mo. 4,
on pages 2 and 3, will appeal to you as being sufficient

protection against interfering adversely with our member
banks.

We are off this afternoon to the governors' conference.

Wasn't that a fine message?
Yours sincerely,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.

JFC/CEP
inc.




Form 1201
%SS OF SERVICE

SYMBOL

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NL

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NEWCOMB. CARLTON, PRESIDENT

GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT

SYMBOL

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DO NOT THINK

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OUR wimITING TILL AFTER WASHINGTON CONFERENCES ARE OVER JAY WILL
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Dear jay _

Here we are still at it + not a dish washed, so to speak. Wold would like
of you adrs. Van Z has telegraphed Ramsey to find out what he wants but hasn't
750
heard from him yet.
We spent the whole morning with the Board. McAdoo handed out a crticism
of our resolution on the 2% certificates + elaborated a defense of his actions. He
then outlined in a general way what lay in his mind as to govt. financing which was
discussed to a certain extent. Delano + Attebury have been with us for an hour +
we are still discussing the collection system. I think sentiment is swinging towards
going after the state banks by express, but no conclusions have been reached.
Have not yet reached the topics of Fed. Res bank drafts ot amendments
to the Act.

We are to meet with the Board again at 10:30 tomorrow + I don't see any
chance of an adjournment tomorrow.
McAdoo asked for information as to whether the Reserve Banks would like
to be offered the next $50,000,000 of short time ctftes, but he was called away from
the meetinpl before he got the replies which were unanimously to the effect that they
should be offered through the reserve banks but not to them.
Everybody is here except Wells + Miller.
Warburg struck me as very depressed.
Delano says Strong has gained 29 pounds + seems to be in fine fettle.
Sorry not to be able to report better progress.




Yrs.

JFC[Curtis]

Form 1204
CLASS OF SERVICE

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NEWCOMB CARLTON. PRESIDENT

9D BY 5L 4EX

BENJ STRONG
4100 MONTVIEW DENVER COLO

PRESENT PROSPECT FOR A FOREIGN

'MISS ION BUT APPRECIATE YOUR OFFER

AND WILL KEEP IT IN

OP CONFERECES JUST ENDED

HAVE YOU SOME NEWS

NEWY

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TELEPHONS YORK 2545.

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April

7, 1917

Dear Gov.

It took me 20 hours to get in to see McAdoo, but I finally did and
telegraphed the result last night. He seemed quite confident that everything would
be arranged on this side, but I think he may well be mistaken. He appreciated
your offer and will carry it in mind.

We spent a good part of our time discussing, at his request, the proposed
bond issue which he intimated would be for between 2 and 4 billions. I enclose
herewith a memo which represents the general views of the Governors in this
regard. McAdoo said one thing which I think is very foolish, i.e., that he
was firmly convinced that the price should not be offered flat, but that there
should be tenders for price as well as dmount. I think with an issue of this size
this would be a terrible mistake as either (a) there would result enormous confusion
or (b) which is more probably) nobody would feel like bidding a premium and the
country would be in the rather sorry position of having asked for a premium and
had it turned down.

The other points of infortance were the rate -- McAdoo apparently himself
being in favor of around 3 1/2%, though saying there was a strong sentiment on
the hill for 3%; the convertibility, on which M. was all right, but again he
thought the Congress might balk; the method of handling, ie., making all of
the Reserve Banks as the only direct fiscal agents of the Government, where
he seemed favorable but lukewarm; and the handling of the actual payments on
subscriptions. This the Governors found the hardest nut to crack, as the
amounts will be so large that everything will get thrown out of gear unless'
great care is used. Do you think it would be wise to leave this money on
deposit only with members of the Federal Reserve System?
I am incl
view, though, of course, in the case of non-member banks and trust companies
we would be asking them to work like dogs on a piece of work, the net result of which
would be to draw their deposits out and put them into their nearby rivals. However,
of course, they have the remedy in their own hands by joining the System, and I
believe that this discrimination (which seems to me entirely justifiable on sound
banking principles) would act as an additional lever to the wavering patriotic
impulse of the better State banks and trust companies and bring them into our midst.
What say you?

Please give your best thoughts to these problems, as there will be plenty
of time to do things even after McAdoo makes his recommendations as the House
and Senate will, I think, Want to be enlightened on some of these fiscal matters.

Incidentally, McAdoo told me that he couldn't publicly write the big
bankers and financiers to confer with him, though he is anxious to get their
views, because then the politicians on the hill would howl that the Bankers
had arranged a high rate to suit themselves and get the profit and had taken
McAdoo into camp. He said it was already intimated here that he was the friend of Wall
Street!( I only smiled -- not laughed.)
So I said if he fe
a method of getting the views of the bankers quietly without their coming to Washington, and he replied that he wished I would see some of them and explain the
political situation of which he is afraid and get their views as best we could, which
will begin to do on Monday.

McAdoo said that he did not think there would be immediate action on this matter,
At the
but he was anxious to have the public mind prepared for a good big issue.
of the Governors McAdoo gave a ver
conference yesterday afternoon with about 7
good talk on the seriousness and bigness of the undertaking we are starting on,
the necessity for sacrifices and economy, especially in the matter of waste of food,
etc., and that the people must make up their minds to universal liability of property se
service as well as military and outlined some good stiff increases in the income
taxes as well as lowering of the exemption to $1,500 or 31,000.
It was a very good


-2-

speech and I must say showed insight, imagination, and a high conception
of obligations. Everybody concurred in the necessity for financing a
large part of the war by taxation, though I donft think the rest go quite
so far as you and I do.
It seemed to shock McDougal to hear me suggest taking 50% of incomes
of over $500,000, for example. But I think we will come to it, and probably
the figure will be lower than $500,000.
Now a word on personal matters. First as to yourself. You ought not
to come on as yet. Great calm prevails and there is no present financial
distrubance in sight. We will keep you thoroughly polsted as to events. If
you came on now, you would likely get exhausted before the real problems break on us and
thus do both you and the Bank, not to mention the Government, a great injury,
by being out of commission when you are most needed. So just keep your shirt on
for another seven weeks.
2nd as to myself. As you know, I have a (customarily) vague feeling of
desire to take a more artive and less sedentary part in this conflict. On
the other hand, no one knows better than I do that I'm getting a trifle oldish
fat, and short of breath and that at least for the present it is clearly my
duty to stay and help the Bank get into shape for handling the vast sums that
will pour in through the N.Y. District. But that won't last forever, and I
want to be looking ahead a bit. Let me know what thoughts the clear mountain
air brings you.

Best wishes for a Happy Easter.




Yrs.
J. A. C.

FEDERAL RESERVE BANK
OF NEW YORK

6/9/i
April 9, 1917.

My dear Gov:

I enclose herewith a copy of a letter I an sending
to-day to Secretary McAdoo, which explains itself.

Those

present at the meeting were "essrs. Vanderlip, Davison, Banks,
Farris, "urphy, "itc'nell, Alexander, Jay of the Guaranty Trust
Company, Jay and myself.

7r. Jay has just received your let-

ter on the subject of Government bond issues, and we note that

you concur in most of the ideas contained in thispenorandum
except as to having the bonds tak exempt.

I have also received your letter of recent date, which
I will not attempt to reply to in detail at the present time
owing to the lateness of the hour.

Portions of it have already

been anomered by my handwritten letter from 7ashington of last
Saturday.

I will write you more fully to-morrow.
Yours sincerely,

Benjamin Strong, 7sq.,
4100 Mont view 7ou1evard,
7.enver, Colo.

JFC/CEP
Enc .




FEDERAL RESERVE BANK
OF NEW YORK
7ERSONAL

April 12, 1917.

My dear Gov:

I feel much distressed at having failed to answer the variety of
your letters for the last ten days, but circumstances over which I have but
slight control have interfered.

I have read with much interest the treatise which you forwarded
to the Secretary of the Treasury on the matter of budget making, which is
extremely good.

I hope he has time to read it and act upon it, but I am

afraid budgets and other such-like dry topics will all go whistling down
the wind for some years now.

However, I have requested the Institute for

Government Research to send you as soon as possible the first of the series
of books concerning which I spoke to you, which is entitled "The Financial

Administration of Great Britain," and is prepared by Willoughby, 7i1loughby
Lindsey and published under the auspices of the institute.

Doubtless

you will find all of your views fully sustained in this book, which I hope
you will read with pleasure And profit.

Affairs at the bank move forward with a certain acceleration of
pace but not as much as you would think.
I wrote you concerning our conference on bond issues, the only

result of which so far has been an indignant wail from Mr. Jacob H. Schiff
to Mr. Jay, plaintively and indignantly inquiring why his firm was omitted
when we were having the conference.

7r. Jay spent some three-quarters of

and hour in pacifying the old gentleman yesterday afternoon and exnlaining
to him that it wasn't much of a conference anyway.
tary has not yet been acknowledged.



7y letter to the secre-

FEDERAL RESERVE BANK OF NEW YORK

Benjamin Strong, Esq.

2.

4/12/17.

We are about to try to get conversion 3s added to the list of bonds
which are to be included with the new issues at 3 1/2% or higher if higher
rates are got out during the war, but I don't think we shall have any success
in this regard.

Of course, our plan would include only the conversion 3s

to be subsequently issued, as everybody must concede that bonds that have already been sold have passed under the bridge and should not be considered.

Last night Mr. Vanderlip had a dinner at the Metropolitan Club
for the prrpose of bringing together the directors and officers of this institution with the Clearing House Committee.

All the committee were there

and also all of our directors except Mr. Locke, and also Jack Morgan and
Alexander.

We had a very agreeable dinner and all hands agreed that it

would advisable to have stated meetings between the Clearing House Committee
and the reserve bank directors or executive comnittee for the purpose of
conferring on topics of vital interest to the banking community, and that
these should begin now before any troubled times appear, so that no comment
will be caused by such cooperative meetings being known.
Our new director, Mr. Saunders, made a suggestion that before
-such an arrangement be made it would be advisable to consult with Washington.

Vanderlir said, "That is very interesting.

Why do you feel that?"

to which

Saunders renlied that he felt that his boss was in Washington, which had
rather a startling effect on the rest of the company, and we spent most of
the balance of the evening in trying to dispel that impression, I think with
some success, but the episode was very entertaining.

We did not have time to talk very much about the bond issue.

What

do you think about limiting the depositaries of the money collected to members
of the Federal Reserve System?
bated at the present time.

This is one of the points being chiefly de-

my view is that it is not an unfair discrimina-

tion and is one that should be made, as the Government has no control over



FEDERAL RESERVE BANK OF NEW YORK

Benjamin Strong, Esq.

3..

4/12/17.

state banks and trust companies that are not members, and while it would
perhaps lessen their ardor in disposing of the bonds and getting subscriptions,
still it might be a sufficient inducement to result

best ones over the line into the system,

in

bringing some of the

on the basis of an enlightened self-

interest coupled with patriotism.

Mr. Jay suddenly decided to go to Washington to talk with the Reserve T3oard about amendments and also other matters, including bond issues

and the rractice to be adopted by the bank in discriminating against acceptances bearing German names.

Our present plan is not to purchase any ac-

ceptances that contain any evidence of having been owned by or used for the
benefit of any German institutions or persons.

Of course, this question

only affects very few of the bills we buy, principally the ones from South
America, but I think our practice should continue as above outlined and it
will do so unless there is some objection raised from Washington.

Jay is

going to try to get a copy of the British bladklist from Sir Richard Crawford,
which we can use for our guidance.
I note that your sons are becoming more bloodthirsty than I ever

have been, and I guess you won't either be able or have an inclination to
restrain them.

Dr. Alexid Carrel says that the present generation will

not see the finish

f the war.

He has just returned from France and ought

to know what he is talking about but I hope he doesn't.

It seems to me

the war will finish within a couple of years now, because after the submarine campaign fails, as it seems to be failing, the people of Germany will
gradually wake up to the fact that the odds are too heavy against then.
So far I haven't allowed my war-like spirits to take complete
possession of me.

The most that I have done is to join a college men's

training corps, which is to hold drills and lectures and give instructions
for super-educated, otherwise ineligible, individuals, two or three evenings



FEDERAL RESERVE BANK OF NEW YORK

4..._

Benjamin Strong, Esq.

4/12/17.

I went to the first lecture night before last and there were seven-

a week.

hundred men there, much to my astonishment.

We learned that there were

three sorts of discharges in the Army, not counting:those when a bomb goes
off prematurely.

We also learned a lot of other relevant facts, all of

which I have no doubt are useful.

We have inaugurated a drill at the bank, which seems to work pretty
well.

Then the gong rings, everybody takes his proper station and nobody

gets shot;

the main vault is closed in two minutes after the money counters'

cash is put in, and the auxiliary vault is closed in four and a half minutes
after all the money and securities from up-stairs are put in.

During the course of these four and a half minutes no place could
be more unsafe than the main floor, as there are fifteen men with revolvers
and four with rifles in the mezzanine ready to victimize the unsuspecting
intruder or some of the more unpopular of the officers.

However, in order

to insure greater safety for ourselves, all those who have revolvers and
rifles and don't know how to shoot are being taught at the 71st Armory or
some other safe place.
I an glad to hear you boast a little bit about your golf!.

That not

only means returning strength and vigor for you but a steady incone of dollars
and golf balls for me, and I-welcome it accordingly on both grounds.
Foning you are the same, I remain,
Sincerely yours

Benjamin strong, 7sq.,
4100 T'ontview Boulevard,
Denver, Colo.

JFC/CEP

P. S. --- Since writing the above your two letters of April 9th have come in.




FEDERAL RESERVE BANK OF NEW YORK

5

Benjamin Strong, Esq.

4/12/17.

I see in your long one you cover most of the points about the bond issue.
I am sending it to Aiken, who is going to Washington on Saturday to be there
a week with his wife and children and who is going to take up these matters
again with the Board and the Secretary and keep us advised.




J. F. C.

FEDERAL RESERVE BANK
OF NEW YORK
April 23, 1917.

Dear Gov:

I have your note of April 18th, enclosing communications
to and from Jimmy Logan, who by the way is a major and not a captain.

He seems to have been about as accurate on your title and

occupation as you were on his.

I have also had a letter from Logan concerning various
ones of these French officers who are coming over to teach at Harvard and other places, and will endeavor to get in touch with them.

Major Adzan, however, went right through New York to Boston and
so I have not been able to see them as yet.
I had the good fortune to see the British commissioners
arriving in Washington yesterday afternoon, although I did not
have an opportunity of meeting any of them.

It was a great sight:

We will get in touch with Lord Cunliffe as soon as possible and keep you advised of what their plans are.
Yours sincerely,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.

,JC/CEP




C'

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symbol appearing after the check.

NEWCOM B CARLTON, PRESIDENT

CLASS OF SERVICE

SYMBOL

Day Message

Day Letter

AM

Blue

Night Message

Nits

Night Letter

NL
If none of theea three symbols

appears after the check number of
words)this Is aday message. Otherwise its character is Indicated by the

GEORGE W. E. ATKINS, FIRST VICEPRESIDENT

symbol appearing after the check.

RECEIVED AT
117-41 -

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TVIR351V

1917 APR 23

J-316A ,18

Q NEWYORK NY 123P 23
BENJ STRONG

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4100 MONTVI PI BLVD DENVER COLO,

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IU CALL YOU JiN TELEPHONE AT TO THIRTY THIS AFTERNOON OUR TIME

UNLESS YOU ADVISE TO CONTRARY




J F CURTIS

PM 5 42




FEDERAL RESERVE BANK
OF NEW YORK

April 23, 1917.

ly dear Governor:
Vie have been trying to reach you by telephone

for about four hours but so far have been unsuccessful.
I send you herewith a copy of a letter which
we have to-day forwarded to Lord Cunliffe at Vashington.
7r. Jay has arranged to see him there to-morrow morning,
and both Mr. Jay and Mr. Treman are to meet him at a dinner given by the Secretary of the 7.reasury in Uashington
to-morrow night.
7ery truly yours,

Benjamin Strong, Esq.,
4100 Montview Boulevard,
Denver, Colo.

JFC/CEP
Enc.




FEDERAL RESERVE BANK
OF NEW YORK

April 23, 1917.

ny

dear Governor:

I have your letter of April 37th with respect
to the Bank of England matter.

I agree with your sug-

gestion as to making a good chronological record of the
various steps of this arrangement, and will have this
done forthwith.

Very truly yours,

Benjamin Strong, Esq.,
4100 nontview Boulevard,
Denver, Colo.

JFC/CEP

JF SERVICE SYMBOL

CLASS OF SERVICE SYMBOL
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WESTERN UNION

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.

111.

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appears after the check (number of
words)this Is a day message. Otherwise its character Is indicated by the
symbol appearing atter the check.

cymbal appearing after the check.

RECEIVED AT

C174CHO§fLICAT7- C, 17151272(177D TITI"t$It

Q NEW YORK NY 231P 25

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to

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969

BENJAMIN STRONG

4100 MONTVIEW BOULEVARD DENVER COLO
EMAN AND

AGREE THAT IF YOUR HEALTH PERMITS IT Is ADVISABLE FOR

I

YOU TO JOIN CONFERENCES AT WASHINGTON WHERE EVENTS ARE MOVING RAPIDLY
YOU DECIDE
PLEASE WIRE US YOUR DECISION AND TRAVELING SCHEDULE IF
OME

EAST




J

F CURTIS.

NL

If none of these three symbols

NEWCOMB CARLTON, PRESIDENT

[917 APR

Blue

Message

FEDERAL RESERVE BANK
OF NEW YORK
July 16, 1917.

PERSO7AL

Dear Governor:

I have neglected writing you about affairs at the bank because there
did not seem to be very much to say.
I have tried to move forward the amendment to the trading with the
enemy bill but with very little success.

I sent a copy to Leland Harrison,

who told me by telephone that he felt he could not do anything about it, as
the original bill had been drafted by the Departments of State, Treasury,

Comerce and Justice, and he did not think one department could very well
try to have it amended without the others.

He seemed to think that you

ought to come back and go before the committee.

I pointed out to him that

it seemed somewhat extraordinary that a private citizen should be asked to
travel 2,000 miles for the purpose of coordinating four departments in "Tash-

ington, but I don't think I made much impression or headway.

He also said

he understood Pratt had sent you a telegram asking you to come, to which I
replied that I hoped you mould not pay any attention to it.
I also tried to get an expression of suggestions or criticisms

from David Hunter Miller, who is acting for the State Department in getting
information of gold exports from New York through the United States Attorney's
Office, and he is giving me copies of everything he gets.

Miller, however,

said he felt he could not give me any suggestions, as he was tied up with
the State Department, so I got nothing useful from him.

Finally I sent a copy of my amendment to Senator Fletcher, with a
letter urging that it be adopted, as it appeared that nobody else was going
to take any initiative in the matter.



...,ERYE BANK OF NEW YORK

2

Benjamlu. 3trong, Esq.

I had some talks with Kent on this matter, and he thought the amend-

ment fairly good but suggested getting in touch with Pratt, which I haven't
done as yet but will try to do some time this week.
I notice you have broken into print and have read your article with
great pleasure.

We are having a series of meetings this week on Liberty loan and
war savings plans, which will take up most of our time, I think.
matters are very quiet.

Otherwise

I hope you are forgetting business and getting a

real rest.

Yours, as ever,

Benjamin Strong, Esq.,
128 Gilpin Street,
Denver, Colorado.

a

rd.(

076

CcX-

AP-A 911_444_

11,1---0Pp

P. S. --- I aM enclosing herewith a letter from Lord Cunliffe, which
I am sending on for your attention, as I believe it is your intention to handle
this correspondence yourself.




I have not acknowledged receipt of the letter.

Form 1201
CLASS OF SERVICE SYMBOL

'", Message

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ter
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Clue
Nite

NL
,f these three symbols

Night Letter
If

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app

ter the check number af

words) .,,,s is a day message. Other.
wise its character is indicated by thd

WESTE4,17A1 UNION
111\\V"
AM
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WES'IERN UNION

GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT

symbol appearing after the check.1

CLASS OF SERVICE SYMBOL
Day Message

Day Letter
Night Message
.

Nght)./ etter ,,-Th/1

If none 4f t'pia

152NY OC 36
Q NEWYORK NY 150P JULY 19 1917
BENJ STRONG

GlIW7ST

DENVER COLO

MAJORITY OF GOVERNORS THINK IT ESSENTIAL TO HAVE

A

CONFERENCE

BEFORE NEXT LOAN CAMPAIGN AND HAVE SUGGESTED AUGUST FIFTEENTH AT

WASHINGTON IN ORDER TO BE NEAR TREASURY DEPARTMENT WOULD THIS

BE AGREEABLE TO YOU PLEASE WIRE




J F CURTIS
1211PM

ree sprat.

ftgrPth e dee* number of
word his-Ise daV message. Otherwise scfiaractertAihdicated byahe
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RECEIVED AT 91-519:251
9 EVENTEENTH ST., DENVER, COLO. AI6ZZS

128

Blue

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ESTEOA& UNION

sYMBOL
Blue

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If none of these throe symbols
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words, this is a day message. Otherwise Its character is indicated by the

cARLTON, PRESIDENT

character is indicated by the

symbol appearing after the check.

RECEIVED AT

illirC247CH




Day Letter

TENEkj". AM

,7iS is a day message. Other-

aymbel appearing after the check.

IIIL

Day Message

WESTERN UNION

Nits
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after the check number of
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As.

CLASS OF SERVICE

138 GOVT

WASHINGTON DC 725P 25
4A4)

STRBNG

jR1298

4100 MONTVIEW BOULEVARD DENVER COLO
SHOULD LIKE TO SEE YOU
TWENTY SEVOND MUCH AS.I
-ANIKS YOUR LET1ER
TRH)
FOR YOUR RISKING THE
FEEL THAT THERE IS ANY OCCAS'lON
CANNOT
TODAY DISCUSSUNG GENERAL
BOARD HAD LONG MEETING WITH CUNLIFFE
INTERESTED WAS NOT
NEGOTIATION IN WHICH YOU ARE
CONDITIONS SPECIAL
IS PRACTICALLY
OUCHED UPON IT APPEARS TO ME THAT NEGOTIATION
THINK
WOULD HAVE TO DO NOR DO
COMPLETE AND THERE IS NOTHING WE
YOU AND CUNLIFFE WOULD ADFW7
ANY PERSONAL CONFERENCE BETWEEN
).
I

4

6

FEDERAL RESERVE BANK
OF NEW YORK

"C)

dl

w.

411j.

sOquly 20, 1917.

t
Dear Governor:

I enclose herewith a draft of a report of a

con,,fe/n/ce

held this

week with respect to the next Liberty Loan campaign. /It is proposed to lay
this before Mr. McAdoo early next week, but before/doing so we would like to
/,

obtain your views.

May we impose upon your leisure by asking you to read

it through and telegraph us your suggestion
We also held a meeting on war atixings, which was very successful.
I will send you a copy of the report as" soon as it is ready.

With respect to our inter961 organization for the next campaign,

our executive committee has voted to have a permanent Bond Issue Division
organized under Mr. Sailer's direction, on the understanding that he is to
be relieved of.a large portion of his present duties,

which

are to be dis-

trnuted among the assistant cashiers (obtaining a new assistant cashier for
this purpose, if necessary), and that he select a new assistant cashier to

take immediate charce of the division and that Mr. Gregory will be retained
in an advisory capacity with compensation.

,I hope you approve of this plan.

It is the result of much travail of thought and meets the views of Messrs.
Treman, Jay, Sailer and myself, as well as those of such of the executive
committee as have passed upon it.
I trust the weather you are having is better than ours, which is
getting a little torrid.
Sincerely yours,

19enjamin Strong, Esq.,

128 Gilpin Street,
Denver, Colo.




LIBERTY LOAN CONFERENCE.

Report of a conference held in
at whieh the following




named gentlemen

New York City, Jtzly 17 and 18, 1917,

were presents

A. L. Aiken, Governor, Federal Reserve Bank of Boston.
C. J. Rhoads, Governor, Federal Reserve Bank of Philadelphia,
George J.

Seay,

Governor, federal Reserve Bank of Richmond.

E. R. Fancher, Governor,

Federal Reserve Bank of Cleveland.

J. B. Meougal, Governor, Federal Reserve Bank of Chicago.

Pierre Jay,

Chairman, Federal Reserve Bank of New York.

J. F. Curtis, Secretary, Federal Reserve Bank of New York.
N. P. Hallowell, Lee Higginson & Co., Boston, Vice Chairman of the

Liberty Loan Committee of New England.

J. R. Macomber, President, Harris, Forbes

Co. of Boston, and

member of Executive Committee of Liberty Loan Committee.

Phillip Stockton, President, Old Colony Trust Co.
member of ExecntI7o :),mmittee of

and representative of the Best:on

of Boston, and

Liberty Lean Onelittee,
Clearing House.

Robert R. S. reeks, Harris, Forbes & Co. of Boston, and
Publicity Committee.

member of

John K. Allen, tro)d, Putnam & ood, Executive Manager of Publicity
Committee.

C. S. Millen, Assistant Cashier, Federal Reserve Bank of Boston.
C. E. Perkins, Lee Higgins= & Co. of Boston and

Secretary of

Liberty loan Committee.
D.

Jay,

Vice President, Guaranty Trust Co. of New York, and
member of
ecutive Committee of Liberty Loan Committee.

National City Bank of New York, and
Manager of the Bond Issue Division of the Liberty Loan

G. E. Gregory, Vice President,
Committee

of New York.

Ggy Enerson, Vice President, National Bank of Commerce in New York,

and Secretary of Publicity Committee of Liberty Loan
Committee of New York.

E. Mitchell, President, National City Company of New York, and
member of Distribution
mittee of New York.

Committee of Liberty Loan Com-

E. B. Sweezy, Harris, Forbes & Co. of New York, and member of
Distribution Committee of Liberty Loan Committee of
New York.
J. Ward, Cassatt & Co., Philadelphia, and me7ber Executive
Committee of the Selling Campaign.

W. C. Janney, Montgomery, Clothier & Tyler of Philadelphia, and
General Manager of Selling Campaign.
P. M. Hardt, Cashier, Federal Reserve Bank of Philadelphia.

Lewis H. Parsons, Graham, Parsonn & Co., Philadelphia, and member
of Executive Committee of Sellin C.e4paign.
J. F. Bruton, Director, Federal Reserve Bank of Richmond, and
President of First National Bank of Wilson, N. C.
Charming Rudd, Alexander Brown & Son, Baltimore, and Chairman of
Liberty Loan Committee for Maryland.
L. B. Williams, Hayden, Miller & Co. of Cleveland, and Vice
Chairman of Liberty Loan Committee of District No. 4.
L. W. Manning, 2neretary, Federal Reserve Bank of Cleveland.

Allard Smith, General Manager, Cleveland Telephone Co., and
member of Publicity Committee of Liberty Loan Committee of District NO. 4.
L. Stuart, Halsey, Stuart & Co., Chicago, and member of Publicity Committee ,f Liberty Loan Committee of Chicago
W. M. J. Fisk, William A. Read & Co., Chicago, and Chairman of
Distribution Committee of Liberty Loan Committee of
Chiaagp.
Edward Clifford, retired, Assistant to Chairman, Prblicity Com,
mittee ef Liberty Loan Committee of Chicago.
Lewis B. Franklin, Treasury Department, Washington, D. C.
J. A. Broderick, Chief Examiner for the

Federal

Reserve Board.

The conference organized by appointing Mr. Aiken as chairman and
Mk. Curtis as secretary, and adopted a programme which included a discussion
of the terms of the bonds and certificates and the selling and other organizations relating to the flotation of Liberty Loans.

After the adoption of the programme the
four committees, every member of the conference




conference was

being a

divided into

member of one of such

committees.

rach committee prepared awritten renert covering the

assigned to it, which was

in detail.

submitted to

The following is a

ference after consideration of

topics

the general conference, and discussed

report of

the final action taken

the committee

by

the con-

reports:

...1=j_aIC.ONS OF Nxya ISSUE OF LIBERTY BONDS.
1.

Amount of Issue and Rate of Interest.

Recommendation -

at
Comment

That the .1ext issue of bonds be three billion dollars
three and one-half per cent.*

This reoommendation is based on the assumption that the
present issue of Liberty Loan bonds will be selling approximately at par at the time the new offering is made,
and that the Government will take the necessary steps to
maintain the market price at par for the outstanding issue while the campaign is in progress.
2.

Date of Issue.

Recemmendation -

That the selling campaign begin not earlier than
October 1, 1917.

Reasons

The last payment for the first loan is not due until
gust 2cOth and the various Federal Reserve banks will be
in communioation with the banks in their districts
tive to the first loan well into September.
There should
be a breathing spell of at least a month between the ending of one loan and the beginning of another.




rela-

During September many of the cereal crops are being
moved, which usually means high rates of money.
71oveever,
the farmelis absorbed in moving his crops and would be
hard to approach on the subject of investment. For both
these reasons a selling campaign during this time should

be avoided.

September and August are without question the worst
investment months in the year.

Bank presidents and directors, mill owners, corporation heads, etc., who would be large buyers of these bonds,
are not back from their vacations in September.
Their
absence will decrease their awn subscriptions but also
materially reduce the perchases of their companies.
Three members of the committee of thirteen which considered
successful flotation also depended upon the Federal reserve banks naming a ninety day rediscount rate on nailer secured by these bonds at a rate of three and
one-quarter per cent.)

*(Note:

the selling campaign felt that the

5.
The number of bond salesmen in active business has
been very materially reduced by war activities, miring
the services of those remaining a very necessary factor
in the selling campaign.
Many of these men also will
still be away on vacations and net available before October let.

All in all, September seems a most unfortunate month
in which to begin a drive on the largest loan ever issued
by this country.
Maintenance of Price at Par.

Recomendationh.

That a sinking fund be provided under which bonds will
have the benefit of a fund of say one-eighth of one per
cent. a month for making purchases in any month when the
Issue sells below par.
This sinking fund not to be accumulative.

Comment

The experience of Great Britain with a similar provision
In the terms of the last loan has been very satisfactory.

-

.12.2_1Mi
Recommendation -

Instalments.

That an intitial payment of two per cent. upon application be required and that subscribers be given the option of paying
instalments, provided
that under no circumstances shall they be permitted to
alter or amend the terms of their original subscription,
except that any subscriber who has elected to pay in instalments may pay in fall, without notice, upon any instalment date.

either in full or in

Delivery of Bonds.

Recommendation -

That definitive bonds or interim certificates in small
denominations be prepared and ready for delivery at the
beginning of the selling campaign.

TERMS_AND CONDITIONS OF 'ISSUE OF CERTIFICATES OF INDEBTEDNESS.
Time and Method of Offering.

Recommendation -

That certificates of indebtedness be offered for subscription every fortnight; that payment for them be
made by credit on the books of the subscribing bank,
the certificates being held as security by the Federal
reserve bank;
the banks be not required to pay
interest on such deposits; and if practicable, that a
schedule of withdrawals be agreed upon in advance.

that

Rate of interest.

Recommendation -




That the rate of interest be determined by the market
and other donditions existing at the time of offering.

In the opinion of the conference it is not only advisable
but necessary that Congress should give the Secretary of
the Treasary complete authority to determine the rate of
interest at which short time certificates of indebtedness
shall be issued from time to time.

Comment

3.

Retirement.

Recommendation -

That certificates of indebtedness should be callable at
par and interest, at the discretion of the Secretary of
the Treasury, on ten days

notice.'

TIME SCHEDULE OF SELLING CAMPAIGN.

Alosiofakaooks.
Recommendation -

Corxaent

-

All subscription books to close 27 days after the openOctober 1 to October 27, inclusive.
ing of the campaign.
By "opening of campaign" is meant the date that Government
circulars, application blanks, etc., are distributed by the

various Federal reserve banks.

kar
Recommendation

-

of Closing_gubscrIption Books.

until the close

That the subscription books remaia open
of business or the last day of the campaign, and that the
various subscription agencies be allawed to receive subscriptions up to that hour.

Report
Recommendation -

of Subscriptions to Federal

Reserve Banks.

That the period during which banks and trust companies

must tabulate and report their subsdriptions to Federal
reserve banks on prescribed forms be fixed at 5 days -October,28th to November let inclusive.

Reports by Federal Reserve Banks to Treasury

Recommendation

-

Department.

That

the period during which Federal reserve banks must
subscriptions to the Treasury Depar'eaent be
fixed at 7 days -- November 2nd to November 8th inclusive.

report their

Allotment by Treasury Department.

Recommendation -

That the period within which the Treasury Department will
barke be
fixed at 3 days -- November 9th to 11th inclusive.

mhke allotment tele report to the Federal reserve

Paymeut of First Instalment.

Recommendation -




That the period within which the Federal reserve banks

shall prepare allotment letters to be sent to the subscribing banks, and within which subscribing banks shall
make payment to the Federal reserve banks, shall be fixed
at 15 days -- November 12th to November 26th inclusive.

7.

Other Instalment Payments.

Recommendation -

That the second instalment be made payable December 20th
and the third on January 17th.

EXPENSE OF LOAN CAlglIGN.

Recommendation

That the Treasury Department apportion among the districts,,
at least 30 days before the opening of the campaign, the
funds available to meet the expenses of placing the issue.

Comment

It is the unanimous opinion of the conference that if the
present organization is to be effectively maintained and the
next campaign made a success, additional funds equal to
another 1/10 of one per cent. of the amount of the loan must
be provided to meet the necessary expenses of the campaign;
and the Secretary of the Treasury is earnestly requested to
take steps to provide such funds, even to the extreme of
asking Congress to amend the Act for this purpose.

FRANKING PRIVILEGE.

Recommendation -

That the Secretary of the Treasury be requested to obtain
the most liberal franking privilege possible in behalf of all
Liberty Loan natter put out by Liberty Loan committees and
the Federal reserve banks.

ORGANIZATION OF CSNTaAL LIBERTY LOAN COMMITTEES.

Recommendation -

That each rederal reserve bank exercise its discretion with
respect to the character of its Liberty Loan Committees.

Comment

The conference is of the opinion that conditions in the
several Federal reserve districts are so varying as to call
The committees esfor different forma of organization.
tablished by the various reserve banks were found to be in
the main highly effective, and their experience will enable
them to eliminate the weak spots and increase their efficiency without attempting uniformity of organization.
ORGANIZATION OF FIELD FORCE.

Recommendation




That each rederal reserve bank call for volunteer experienced salesmen for the campaign, the call and reoommendation
for appointment to be subject to the approval of the Liberty
Recommendation for apLoan Committee from each district.
pointment of salesmen to be forwarded by the rederel reserve
banks to the Secretary of the Treasury, by whom all appointments will finally be made. Suitable insignia for salesmen
and others designated by the Federal reserve banks and the
Liberty Loan committees acting together to be furnished by
the Treasury Department.

DISTRIBUTION OF LITERATURE.
To Liberty Loan Committees.

Recommendation -

That the Treasury Department send all of its official eirculars only to eedenal reserve banks, and that the reserve
banks should undertake the distribution of such circulars
to all subordinate Liberty Loan Committees.

To other bRnkinR institutions.

Recommendation

That the Treasury Department send to every bank and t-ust
company and other banking institution in the country its
official circulars relating to the Liberty Loans.

Comment

It was stated to the conference that the Treasury Department had under consideration the preparation of a communication to be addressed to each bank and trust company in
the country requesting to be advised of the number of its
depositors in order to enable the Secretary of the Treasury
to furnish such banks, to be forwarded to each depositor,
circulars explaining the Liberty Loan and appealing to the
depositor to purchase the bonds.
This plan met with the hearty approval of the conference,
and in connection therewith it is suggested that the Treasury
Department advise the various Federal reserve banks of the
names of the banks which furnish this information so that the
matter may be followed up further by the Liberty Loan Committees.

FURTHER CONFERENCES.

Recommendation

That represeltatives of the twelve central Liberty Loan
Committees meet in Washington with representatives of the
Treasury Department prior to the campaign, for the purpose
of discussing and coordinating methods; and that this conference arrange for proper contact with the Treasury Department to facilitate operations during the campaign.

TECHNICAL ADITINISTRATION.

A special committee of technical
serve banks has been

formed to make

represe tatives of the Federal re-

recommendations

of the receipt and payment of subscriptions,
and definitive bonds;

in regard to the details

deliveries

of interim certificates

also, all matters relating to deposits of Government

funds in connection with the sale of Liberty Loan bonds.

The report of this

committee will be submitted to the Secretary of the Treasury as promptly as
possible.



-8APPENDICES.

There are appended hereto reports of the Committee on Selling Organization (Appendix "A") and the Committee on Publicity (Appendix "B") which embody

many suggestions interesting to the Federal reserve banks and Liberty Loan committees, but which do not deal with matters which must necessarily be passed
upon by the Treasury Department.




APPENDIX "A"

SELLING ORGANIZATION.

It is the opinion of the districts represented at this meeting,
namely, Boston, New York, Philadelphia, Richmond, Cleveland and Chicago,
that the most effective programme of selling is the one carried out in the
last campaign, in general, as follows:

Appointment of Central Committees by the Federal reserve bank, and
the appointment of local committees covering all banking centers, which are
to be assisted and directed by experienced bond salesmen.
Each local district should be organized with the greatest possible
detail.

It is the opinion of the committee that this can be beat developed

by the maximum amount of personal contact in every line of endeavor.

For

Instance, in large cities a chairman for each important trade should be appointed from that trade by the Liberty Loan Committees.

This chairman

An

should then form a committee of his own to completely cover this trade.

experienced salesman reporting to the Liberty Loan Committee should be made
sponsor for this committee to help the chairman in every way.

The method

of covering a city by trades committees does not preclude the city being also
covered by salesmen who shall be allotted various districts.

Between the various Liberty Loan campaigns we recommend that each
district maintain a skeleton

organization

at small expense in order to take

care of any details which may come along, such as arranging reports, com-

pleting the files and notifying chairmen of various local committees of any
important decisions bearing on the Lierty Loan bonds, rendered in Washington.
It is recommended that a representative, apneinted by the American
Bankers Association, be added to the distribution committee, or some other
suitable committee, in each Federal reserve district, in order that the

various

Liberty Loan Committees shall receive the benefi# of its valuable work and




organization.

That an effort be made to have all other organizations,

including the women's organization, insurance companies, express companies,

etc., cooperate with the various Liberty Loan Committees through their membership in any given localities.
It is recomnended that in the agricultural territories farmers'
organizations, county fair associations, and State, county and district
school authorities be called Upon to use their influence to disseminate
information and stimulate interest in the sale of bonds.
It is our opinion that bond salesmen should be used to a greater
extent than in the last campaign to organize and supervise local committees
throughout the various districts, rather than to utilize these men for house
to house canvass.

This work can be covered by available persons not neces-

sarily trained to the bond business.
The "movie" campaign should be carried on with reels, slides and
speakers, as heretofore, but with greater definiteness as to authority, especially as pertains to speakers at ,*movie" performances.

It is our belief

that the reels and slides should be furnished from a central bureau, but

that speakers at movie performances should be furnished by the speakers' bureau of each district.

In regard to meetings and speakers, it is our belief that the best

results will be obtained by speakers' bureaus in each district, reporting
to distributing rather than publicity committees.

We recommend that the

active manager of the publicity work should be made a member of the distribution committee.

We believe that very important results come from meetings,

and that these should be exiended beyond those of the past campaign.

We strongly urge the desirability and necessity of simplifying the
methods of subscription.

e recommend that any prospectus or circular that is issued from
Washington be so simple and concise in its language that it will be understood



-3-

by laymen, and that it be printed in bold type, on one side of paper only.

We recommend that

the

whole machinery of the Post Office Department

be used as a means of soliciting and taking subscriptions.
It Is the sense of this committee that the apportionment of the
amounts to be raised by the twelve Federal Reserve Districts, and reapportionment by such districts over towns and cities in their respective territories was a very potent factor in the development of subscriptions during
the past camnaign, but it is also felt that

the basis

on which such appor-

tionments were made among the twelve Federal Reserve Districts should be given
further study, to the end that it nay be as nearly equitable as possible.
We are of the opinion that the apportionment, within

Federal Reserve

Districts,

should be left to the judgment of the Liberty Loan Committees controlling such

districts.
It is recommended that the smaller investors should be reached through
some organization to which they belong, rather than by devoting the services

of bond salesmen to soliciting 050 and 0100 subscriptions.

A special committee

should be appointed to devote itself exclusively to securing subscriptions from

wealthy individuals and corporations, each individual and corporation being
expected to contribute a,certain minimum.




Al2E42.17, "B"

PUBLICITY
Discussion at the conference of publicity representatives has brought
out the feet that the policy adopted in the last campaign as working in existing
organizations is the most satisfactory that can be devised.

The amount of work necessary, however, tn order to obtain the full cooperation of organizations skilled in the highly technical work of advertising,
the supplying of news, etc., requires months of preparation and this Committee
accordingly recommends that facilities be provided by the Federal reserve banks
in each district for the immediate establishment of at least a small Liberty
Loan Publicity headquarters.

This will serve as a rail-ling point for the

scores of people who want to help in the publicity of the next campaign and
who are anxious to lay their lines plenty of time in advance in order to
avoid confusion and unnecessary expense.
Our Committee is unable at this time to attempt to

cover

the expen-

ses and technical points with regard to the distribution of publicity material
and other educational work undertaken by the
last campaign,

Publicity

Committee (luring the

These matters have been made the subject of separate reports

in the districts of Chicago, New York and elsewhere and those particularly concerned will find these reports available.

general

tendency of all students of the

namely that the general publicity
dition and

that

It may be said, hewever, that the

subject is

machinery

toward the same conclusion,

exists in

a highly organized

the chief thing necessary to enable it to function in

campaign to the highest degree of efficiency, is an immediate
headquarters and duly constituted authorities.

which go to make up the American

publicity

con-

the next

establishment of

The hundreds of organizations

machinery will then be informed

definitely as to just what is required of them, thus enabling them to adopt
a policy of preparedness.




The Committee feels that one of the most important points to be con-

sidered involves

coordination

PalicitrCommittee and all other

between the

This applies particularly to

Liberty Loan sub-corraittees and agents.

work of the Publicity Committee and that
tee.

or the Distribution or

the

Selling Commit-

These two bodies are called upon to do work which in many of its features

is identical.

In the district of Yew

tween educational .work;
etc._, and

the

ly go and

Yo7,k, the distinction largely lies be-

such as advertising, news,

moving pictures, posters,

sell the bonds.

personal solicitation on the part of trained men who could actual-

During the last campaign the Speakers' Bureau was under the Distribution Committee in Boston and under the Publicity Committee in New York and
.Chicago.

No rule can be laid down

in

this natter.

It is clear, however,

that a definite understanding should be had at the outset as to a division of

responsibility in all matters connected with bringing the loan to the attention
of the public whether through the written
It

the spoken word.

is our opinion, however, that there is no

any crossing of wires
mittee

or

between the selling and publicity committees.

must know what the other is doing.

one man responsible

fundamental reason for

Each com-

It is largely a question of having

for results in every committee and holding the managers of

the selling and publicity committees

responsible for a complete

coordination

of their respective line of work.
- In this connection it should be said that the responsibility of estab-

lishing committees in the various industries should lie directly with the
General Liberty Loan Committee.

When a committee of railroad men for example

is established, this committee should be tile recognized medium for reaching

railroad men

both

with regard to publicity and with regard to selling.

Such

-a committee should not be called primarily a selling committee any more than
It should be called a publicity committee.

a :Railway Liberty

In our opinion i

Loan Committee and it should then be the

duty

should be called
of the managers

of the Selling and Publicity Committees to-see that the Railway Committee thor


oughly understands the campaign laid out and cooperate in full in selling the
maximum number of bonds in every possible way.
It goes without saying that every oammittee is anxious to

cooperate

in every possible way with such central organizations or steering committees
as may be established in Washington.

During the last campaign there was a

'greeter of Publicity in the Treasury Department who was

able

to cooperate with

the various Liberty Loan Committees in seduring the assistance of the Gorernment
Printing Office and in many other ways.
It is impossible, however, for

any human being, no matter how wide

MP

his experience, to farm a temporary organization in Washington which can enable
or guide in detail the work of the various Liberty Loan Committees with their
varirus local problems and requirements which differ.

It is true, however, that if a director of publicity is to be appointed for the next loan, he should be appointed

the Liberty

imlJediately,

Loan Committees may be able to cooperate with

in order

him from the

that
outset.

It is, however, earnestly recommended that the Publicity Committee

in each

district

be

given an approximate idea

much money it can spend.

early in

the campaign as to how

Obviously $10,000. early in the campaign is of much

more value than many times that amount toward the end of the campaign.

With the view of making certain specific recommendations, the committee offers
1.

the

following concrete suggestions:

ORGANIZATION.

An ideal committee is one responsible to the executive committee of
the district and composed of trained advertising men, a sales manager accustomed to selling merchandise to masses of people, representatives of bend
houses, and an experienced newspaper man possessing the confidence of the city
editors.
(a)

The publicity committee should be in constant and intimate con-

tact with the distribution committee and speakers' bureau, both of which furnish



much material for news publicity;
(b)

The Director of Publicity in the Treasur: Department can assist

the district committees in several ways, but each district should be left to
develop its own methods and not dppend upon anyone else for ideas or material,

with the exception of buttons which shouad be ready in the hands of the secretary of the executive committee of each district before the loan opens.
is important.
(o)

This

The button should be given out when the subscription is made.

Committee organization --

a chairman or executive manager who

The publicity committee should have

should give his entire time to the work

and be responsible for all details.

The inside organization may well bei
The executive manager,
A member responsible for advertising "copy,"
A member to handle the outside organization
such as the Womens' Special Aid, etc.
A member to put through spectacular things
to gain publicity,
A member to. handle the news publicity.
This organization should be permanent until the close of the Government financing for war purposes.

The executive manager can keep a skeleton

organization in interim between campaigns.

During the campaign there is work

for all the members.

In the larger cities in each district there might be local sub-

committees on publicity to post advertising matter and attend to details in
which the central committee may need assistance.
(d)

As news publicity is essential and newspaper advertising and

news are interdependent, it is desirable, if possible, that some paid publicity
should begin with the opening of the
until its close.

campaign and

be continued, if possible,

The cost of such a campaign may be provided for as each

executive committee finds possible.
In addition to daily newspaper advertising all merchants and other

advertisers should cooperate by using references to the bonds in their awn advertising.



All traction companies, steam and electric, should carry advertising
posters in and on their cars.

Posters on billboards, dead walls, hoardings

and in store windows should be profusely used.
Brief eduaational and inspirational

leaflets should be

distributed

to the public with public service and commercial invoices in parcels,

pay

envelopes and other ways to gain entrance to homes.

American citizens speaking other languages than English should be
reached by the foreign language press and by posters and leaflets in foreign
languages.

In conclusion this

committee

desires to say that while it regards

the problem of floating an additional loan in the fall as a most serious and
difficult one, it believes that if
case before

suitable

opportunity is given to put the

the American people in a clear and

intelligent way and if

suitable

offices and other facilities are promptly pravided, the next loan can be car
red through even more successfully than was the last one.




FEDERAL RESERVE BANK
OF NEW YORK
July 21, 1917.

Dear Governor:

I am sending under separate covers about four-hundred letters which
I understand you want to sign personally.

They are addressed to various peo-

ple who have been ennloyed in the various Liberty Loan committees.

The let-

ters are divided into two groups, one representing persons whose employment
has terminated;

the other, those who are still at work.

There is also a

small group of Gregory's immediate assistants, who are addressed personally.
I hope you don't get writer's cramp from attending to them.
The governors' conference has been definitely called for August
15th.

Referring to the amendment to the trading with the enemy bill, I
have finally sent a copy to Harding, Crosby and Charles Warren of the Department of Justice, and urged them to get together with the State Department and
Department of Commerce and get some action.

Thi

from 7arding, saying that he and Warburg have taken the matter up with Crosby
and made a change, placing the authority in the Federal Reserve Board instead
of with the Federal reserve banks, and adding that this was for submission
to Secretary IcAdoo for administrative apnroval.

I am writing him stating

that either way suits me, provided we can get some action, and also saying
that 7essrs. Kent and Rovensky have agreed to go to Washington, if call upon,
to present a statement of the situation and of how it can be remedied.

am also telling him that I am getting some data from Blackett as to the way
it is handled in

ngland.

I think that possibly we may be able to make

some headway now.
Very truly yours,

Penjamin Strong, Esq.,
128 Gilpin Street,

http://fraser.stlouisfed.org/
Denver, Colo.
Federal Reserve Bank of St. Louis

_cW YORK

Benjamin Strong, Esq.

7/21/17.

P. S. --- I enclose a letter from Mr. Ingalls Kimball, which has
not been answered.




J. F. C.

FEDERAL RESERVE BANK
OF NEW YORK

0

July 27, 1917.

Dear Governor:

I have just received your telegram of July 23rd addressed to me
in Washington.

Unfortunately our train was so late that I didn't go to

1718 H Street at all and so missed receiving it.

Kent and I spent the morning trying to be heard by the sub-conmittee
of which Senator Ransdell is chairman, which has the bill in charge, but as

they only sat an hour and a half and adjourned at noon to meet again the folHowever, we did,

lowing day, we had no success.

I think, convince Crosby

of the necessity for getting the billthrough and he is taking an active interest in it and in consultation with Warburg and others has made some changes
in the draft which I prepared, so that it now reads as shown in the enelosed;----,-

memorandum.

We also talked with Messrs. Harding and De1an4 who we'refavorably
inclined towards the plan, but stated that they. could not press

unless requested to by sone.of the Departments.
further from Crosby but am writing:htm

been made.(41.4"

for

the bill

1)w-0:not heard anything

-day as. to whether any progress has

)4

I have just received your two telegrams to Mr. Jay with reference

to the organization of the Liberty Loan committees and agree with both of
then.

He is out of town to-day for the week-end but will doubtless take

the matter up on Monday.
We are having a slight discussion with the Board as to the method

of holding the next conference of governors, and I will let you know the
final developments next week.




DERAL RESERVE BANK OF NEW YORK

7/27/17.

Benjamin Strong, Esq.

"Ye are today forwarding your letter to M. Pallain, together with
your memorandum which Messrs. Treman, Kent and I have gone over.

Mr. Kent

is showing it to M. De 7euf1ize this afternoon.

The war situstion looks pretty bad from this end of the wire.
does it look out there?
Yours sincere 7,

Benjamin strong, Esq.,
128 Gilpin Street,
Denver, Colo.

Enc.




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CLASS OF SERVICE SYMBOL
Day Message

Day Letter

NEWCOMB CARLTON, PRESIDENT

GEORGE W. E. ATKINS. FIRST VICE-PRESIDENT

RECEIVED AT 915-919 SEVENTEENTH STREET, DENVER, COLO.

'.OAT

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symbol appearing after the check.

Tptls

Q NEWYORK NY 540P JULY 31 1917
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128 GILPIN ST DENVER COLO
PROPOSED CONFERENCE OF GOVERNORS POSTPONED LETTER FOLLOWS




J F CURTIS
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appears after the check (number of
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346NY OC 7

BENJAMIN STRONG

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Form 1201

FEDERAL RESERVE BANK
OF NEW YORK

O DE_
s4agUstiAi 1918.

JjERAL RESERVE B.:
Dear Gov:

Since last we met I have been spending ny days in the consultation
rooms of all the doctors in town, with the following result.

Martin says there is nothing the matter with me, so far as he can
find out, but I ought not to attempt to be a soldier.

Cutler says there

is nothing the matter with me, so far as he is concerned, but I
to attempt to be a soldier.

ought

not

He does admit that I have slight astigmatism

of one eye--I have forgotten which--and he has prescribed a pair of spectacles
which now adorn me.

He thinks that this astigmatism has been a contributing

cause to my headaches and tiredness and that the glasses will help to bring
relief.

Hunt (who is a nerve specialist) says there is considerable the mat-

ter with me from his point of view, although he agrees with the other two
from their points of view.

He claims that I am suffering from concussion of

the brain, nervous exhaustion and shock to the nervous system, and he also
says that I would be foolish to be a soldier at the present tine, as in his
opinion I couldn't last very long.

He has prescribed a complete rest for

514,04-x-

a while, no worries, exercise, out-of-door life in a cool climate, and more
to eat.

Three days ago I received practically an opportunity of going over
at once to France with a commission in the new Chemical Warfare Service,

as

Defense Division, which is being hurriedly organized at Pershing's request.
They are taking over a lot of hand-picked civilians, practically all college
men, many of my friends and associates.

Percy Haughton, the foot-ball coach,

is a major and one of the chief cooks in the new service.



I listened to

8/9/18.

Benjamin Strong, Esq.

FEDERAL RESERVE BANK OF NEW YORK

their siren songs for three days, but have finally told them to-day that I
would not join up with them now for various reasons.

However, theyolaim

they can keep a place open for me later on, and as I think it is a great opportunity, I propose to keep in touch with them, but with no intention of
making any final decision or move until after the next Liberty Loan Campaign,
so you need have no cause for worry yourself on my account, and I have to-day
telegraphed you to that effect.

We are moving to the little cottage on my Mother's place at Manchester on Tuesday night.

Hunt says four weeks will be better for re

than three, and that even more than four would be advisable.

I told him

that it was imperative that I be back in time for the next Liberty Loan and
he made no opposition to that.
If you are going, or have gone, to Charley Norton's, stop over and
spend a few days with us at Manchester on your way back.

I will show you what

a real golf course is like; also some groat golf.
"le have had no reply from San Untermyer.

I an leaving this matter

in Mr. Sailer's hands.

I have given some thoughtto obtaining a new assistant secretary for
the Liberty Loan Committee and believe the best man would be Mr. Beyer, if

you feel that you can let Mm spare that amount of time, which, as you know,
is not really very much.

I think this would be a great help in keeping you

absolutely advised of everything and having the whole mechanics right under
our own control.

Since dictating the earlier part of this letter,
with Leffingwell about space in the building.

f have talked

He says he has been holding

up the question of taking a definite attitude with respect to Untermyer and
the other tenants until McAdoo's return, as he has no doubt that McAdoo's
personal influence would have far greater weight than any letter he, Leffingwell,



FEDERAL RESERVE BANK OF' NEW YORK --as

could write.
week.

Benjamin Strong, Esq.

He promises to take the matter up with McAdoo promptly next

I have asked him to communicate direct with Mr. Sailer.
Please give my warm regards to Katherine.
Yours as ever,
10

Benjamin Strong, Esq.,
E. G. Spaulding Cottage,
Woods Hole, Mass.

JEC/CEP




8/9/18.

FEDERAL RESERVE BANK
OF NEW YORK
January 23, 1919.

Dear Governor:
I attended the meeting of the board yesterday, at which the first half
of your letter was read by the chairman.

I said that I was charged with the

duty of seeing that the whole of the letter was read, whereupon the second half
was handed to me to read.

He says he is really very well now and doesn't see

any reason for going away at the present time, but agrees to go at the first
sign of tiredness or trouble.

The reading of the letter naturally precipitat-

ed some little discussion and I think the situation is in perfectly good shape.

We certainly had a fine time at your hostelry and only wished we could
have stayed longer and put away a few more griddle cakes.
I am sorry to be dumb about the only piece of business you asked me

to do, and still sorrier to have to admit dumbness, but I have talked with both
Barrows and Hudson concerning the proposed pamphlet on our practice with respect to Government bonds, and I find that no one of the three of us has clearly in mind what the object Of the pamphlet is to be, i. e. whether to instruct
banks or to instruct individuals, or both, and whether it is to contain copies
of all the regulations or whether it is to be more simple and narrative in form,
or whether it is to combine the two.

I am afraid I didn't listen very closely

while you were talking on this subject, as I can't remember what you said you
wanted, so if you can let me have your views in a few words, pray do so and I

will attend to the rest.




;45.

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FEDERAL RESERVE BANK
OF NEW YORK

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FEDERAL RESERVE BANK
OF NEW YORK
February 24, 1919.

DETT

Dear Gov:

-QA-Yr

\\°

about the Governors Conference and

I have your note of .Bwry.ark,

enclose herewith a copy ofp#1,,,sVtre]NwAl.i.q.,,Iy-ii.wending to all the other governors.
t47,

I am inclined to think this will irritate the Board but if we find that it irritates them too much, of course it can be dropped.
I have handed your check over to Lang Marvin, who is naturally pleased,

but he wants me to say that, as he has repeatedly told me, he does not want you
to feel any obligation in the matter in any way and that he would be very glad
to continue as George's creditor without any subStitution.

He adds that since

I have sent him the check, he presumes that you are anxious to take his place
and he consequently accepts the chE.ck with many thanks.

In this connection I told him that I had not spoken to you about it

after the first time, when you agreed to go in, but that you had several ties
spoken to me about taking up the "white man's burden" and discharging your oral

k)04"

understanding entered into at that tine.

SReferring to your letter of Fe br

y 6th on the subject of real estate

purchases, I am still at work getting a complete roster of all our outstanding
leases.

So far I am not upset over the situation, although there are several

that run beyond May 1, 1920. ' I am still in agreement with the viers of our
real estate brokers that in most of the cases it would be unwise to frighten the
tenant too early in advance with talk about our desire to 'get immediate possession.

You may rest assured that these matters are not being overlooked and

whatever parcels we are getting with outstanding leases on then, we

are getting

with our eyes open and because we feel that the situation is best handled in
that way.



I will send you a little further line about this in a few days.\,-

FED

RESERVE BANK OF NEW YORK

-.,

9ERAL

Benjamin Strong, Esq.

.

2/24/19.

Referring to your letter of Abruary 18th on the su

ofz.rgotecting

IS..,/,

Liberty bond holders again fraud, I may say that we have aApady started cflksiderable investigations along the line you suggest.

44tc

7)

rtois in charge of

4/4*,

this and has some "Baby Bonds" which he hands to some not too well'4*Ie employe to offer for sale in the various offices, concerning which you write.
This individual is accompanied by a secret service man (also not too well dressed)

for the purpose of getting exact information as to what the dealers do and say
with respect to these purchases.
.

Of course, it is very hard to catch them, as they simply make an offer

of a price, generally without saying that it is the market price or anything
else, and naturally there is not much legal pressure that one can bring to bear
upon people who buy things for less than they are worth from a willing, even
though ignorant, seller.

However, the matter is not being neglected.

am expecting a report from Mr. Bogart any day and will let you know what he says
when it comes in.

X
, .

Benjamin Strong, 7sq.,
Cluneden,
Lake George, N. Y.

JFC/CEP




Yours sincerely,




FEDERAL RESERVE BANK
OF NEW YORK

February 27, 1919.

Dear Gov:

The total cost of the dinner at Sherry's in honor
of the Secretary of the Treasury was .;490., of which your
share is

49.

If you will forward me personally a check

for this amount, I will dispose of the matter without its
going on the books of the bank.
Yours sincerely,

Benjamin Strong,'Esq.,
Cluneden,
Lake George, N. Y.




FEDERAL RESERVE BANK
OF NEW YORK

nuNc DA;PT.
February 2, 1919.

111)
BAIIK
FEDERAL RESER'S.TE
Dear Gov:

I have your letter of yeste
r. Beyer is sending you the draft o

by the Feieral Reserve Board for

I understand

programme prepared

e conference on Larch 20th.

This seems to me so all inclusi e and so much rore complete
than I had supposed would be

he case, that there is hardly

any use in my attempting to prepare any supplemental programme,
especially in view of the fact that I haven't received any
suggestions from any of the other governors, so I think that

we may as well consid r that the idea was born to die.
Yours sincerely,

Benjamin Strong, Esq.,
Cluneden,
Lake George, N. Y.

J.XiCEP

,

BRAIVI

../)

APR 1)
BANK
FEDERM, RESERVE

::1191.49.)\.:
fon)

l'eear Governor:
1 have your memorandnm of April 14th on the subject of the chart,
and since the receipt thereof have also obtained a copy of
emended as of April

leith,

the revised

chart

and beg to give you below my comente on the organ-

ization above the line indicated at the reeLing at the Union League Club.
I have no comments to rake with respect to any ratters appearing above the line joining the words "Organization" and "Operation."
'-ith respect to the matters below that line, I recommend -the

following changes:




The elimination of the title of deputy governor from
The purpose of this is
all except one person.
to make a single deputy governor whose functions
shall be to exercise the powers of governor in
Durin4 the presence
the absence or the governor.
of the governor he should keen in touch with the
detail of administration of all the bank so far
es possible, so that he would be the natural conduit through which questions of policy would go
from the other officers to the governor.

I would change the titles of the three principal officers under the heading "Organization" to read as
folows: Comptroller, Counsel, Director of Administration.

I would change the titles of the

principal officers
under the left-hand subdivision under the word
'Operation" to read as follows: "Cashier, Director

of Collections,

Ttirector of foreign exchange,
.2irector of 'nans, Director of Investments.

I would change the titles under the right-hand subdivision under "Operation" to read as follows:
fiscal Agency Director, fiscal Agency nirector.
Mile this repetition of title seers unfortunate,
my inagination is not sufficiently acute to invent
a differentiation of title for the six divisions
under the fiscal Agency Department which 'would.
accurately describe e combination and division
into two parts of the six functions outlined, and

2.

Benj. Strong, Esq.

4/15/19.

LI BRA RY
APR 1 6 15,10
FEDERAL RESERVE BANK

consequently I leave the person in charge of a

half of the work with the sane title as the
other person, believing, as I do, that the supervision of those six divisions would require more
than one man, under a proper organization.

I would have all the titles above described on the
sane line with each other and the individuals
exercise sirilar authority and be of sinilar
rank, although, of course, not necessarily to
receive similar compensation.

3.

I have no conrents to make with respect to the Buffalo Branch

aart of the chart.
Very truly yours,

Ben:anin Strong, 'sq.,

Governor, Pederal Reserve Bank of New York,
New York.

JFC/CEP




0




DENISON AND CURTIS

WOW:NV.0RM BUILDING, NEW YORK CITY

6 October 1919

Mr. Benjamin Strong,
15 Nassau Street,
New fork.
Dear Ben,
Here is 45 rei.-ard for your ability as a golfer.

t Wadsworth wants to join the Piping Rock
Davison and I anaputting him up.
They
tell me that some endorsing letters are required.

Clubr

Will you be so kind as to write one to F. L.
Crocker, Secretary, 5 Nassau Streety
Yours sincerely,




DENISON AND CURTIS

WOOLWORTH BUILDING, NEW YORK CITY

December 11, 1919.

Dear Beh,
Many thanks for your
refererce to Freund.
SOMO

letter of the

10th with

You did speak to me about it

days ago.

7 also have your two letters en the subject

of dOUghnutz.

If I

had as large a staff as you, I

might gather together enough information to put you
doun.

I notice yeu do not quote from any Yew En land

authorities.

Yours very truly,

ji

Benamn Strong,

Fsquire,
Federal Reserve Bank of New York,
15 lassau Street,
Mew York city.

JFC:EM

/49

--7t

cu RT I S, FOSDICK 8( BELKNAP
ATTORNEYS 8c COUNSELORS AT LAW
WOOLWORTH BUILDING

JAMES F. CURTIS
RAYMOND B. FOSDICK
CHAUNCEY BELKNAP




WILLIAM J.CURTIS

COUNSEL

NEW YORK

CABLE ADDRESS, CURTISITE

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CU RTI S, FOSDICK & BELKNAP
ATTORNEYS 8, COUNSELORS AT LAW
WOOLWORTH BUI LD I NG

JAM ES F. CURTIS
RAYMOND B. FOSDICK
CHAUNCEY BELKNAP




NEW YORK

WILLIAM J.CURTIS

COUNSEL

CABLE ADDRESS: CURTISITE

December 28, 1921

Benjamin Strong, Eso.,
St. Vincent's Hospital,
Seventh Avenue & 11th Street,
New York.
Dear Ben,

Many thanks for your present to the boy, which arrived
safely and is much appreciated.
Your wat -dogs give such good reports of your progress
You
come up to see if they will let me in.
that I
certainly have had one hard pull, and I do hope that
your troubles are about over and that best wishes for a
happy New Year do not sound like hollow mockery.

Yours sincerely,

CURTIS, FOS DICK & BELKNAP
ATTORNEYS & COUNSELORS AT LAW
WOOLWORTH BUILDING

JAMES F.CLIRTIS
RAYMOND B.FOSDICK

NEW YORK

CHAUNCEY BELKNAP,'

WILLIAM J.CURTIS

-

COUNSEL

JAN30 1922

as

CABLE ADDRESS: CUR,SITE

January 19, 1922

Benjamin Strong, Esq.,
The Marlborough-Blenheim,
Atlantic City,
N. J.
Dear Ben,

Having heard some comment with respect to the views accredited

to you on the subject of the amendment to the Federal Reserve Act which
has recently passed the Senate of the United States, I take pleasure in
inviting your attention to the language found in Section 8. of a bill
introduced into the Senate December 1, 1913, by Mr. Burton, with the
This

early history of which I understand you are somewhat familiar.

Section provided that the government and control of the Federal Reserve
Bank of the United States should be vested in a. board of 7 directors, to

be known as the Federal Reserve Board, all of whom should be appointed
by the President of the United States by and with the advice and consent

of the Senate, and whose selection should "be made from persons who are
citizens of the United States and are qualified by experience and
training for the proper discharge of ';lie duties imposed upon them by

this Act, and in making such selections due weight shall be given to the
agricultural, comaercial, and industrial interests of the different
sections of the country, and at least three of the members shall be




Governor Strong

2

1/19/22

persons recognized as possessing exceptional banking and financial experience.
This should be compared with the provisions in the present

Federal Reserve Act to the effect that in appointing members of the Federal
Reserve Board "the President shall have due regard to a fair representation
z

of the different comnercial, industrial and geographical divisions of the
country"; and that "of the 5 members thus appointed by the President,

at least 2 shall be persons experienced in banking or finance."
From this it would appear that the wise and distinguished authors
of the Burton bill made a more careful provision to safeguard the agricultural interests of the country than did the authorsof the Federal Reserve
Act.

It certainly is interesting to see this particular chicken come

home to roost./

It seems to me that the agricultural bloc has jockeyed the

situation around so that it is pretty difficult to object to this change

as a matter of principle, e x cept for the unfortunate part of having the
Board composed of 8 instead of 7 members.

The method of bring it about,

however, is certainly far from pleasant.
Hope you are having a good time and rapidly recovering your
health.

For heaven's sake, don't come back too soon.

P"

Yours as ever,

JF0/T

ALL

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CURTI S, FOS DICK 8( BELKNAP
ATTORNEYS St COUNSELORS AT LAW
WOOLWORTH BUILDING

JAMES F.CURTIS
RAYMOND B.FOSDICK
CHAUNCEY BELKNAP




,tov
nr,46/I,LLIAm J.CURTIS

NEW YORK

COUNSEL

CABLE ADDRESS: CURTISITE

Mecanber 21, 1922

Dear Ben,

Many thanks for the Liberty bond,
which I will see is safely delivered
to your godson and which I know will
be deeply appreciated, both by him
and his parents.

We are going to be in Glen Cove on
Christmas day.
Would you care to
come down for any part of it, in case
you haven't other engagements?

Benjamin Strong, Esq.,
Governor, Federal Reserve Bank of New York,
15 Nassau Street,
New York.




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CURTIS, FOS DICK

BELKNAP

ATTORNEYS & COUNSELORS AT LAW
WOOLWORTH BUILDING

JAMES F. CURTIS
RAYMOND B. FOSDICK
CHAUNCEY BELKNAP

WILLIAM J.CURTIS

COUNSEL

NEW YORK

CABLE ADDRESS: CURTISITE

ACKNOwLEFOIV,D
OCT 2 8 1924




October 1st, 1924.

R

Benjamin Strong, Esq.,
c/o Spencer Penrose, Esq.,
Broadmoor,
Colorado Springs, Col.

Dear Ben:I am passing along herewith a letter from
Mac to Wady which we thought would interest you.
Will you please return it to the latter when you
have read it?
I am sorry you got away without my having
got more of a glimpse of ycu this summer, but trust
we will co better on your return.
I have just
had a long visit from our old friend the Bishop .f-rottri
Arizona.
He asked tenderly after you and he seems
to be in his usual good form, especially, as Bill
Woodward would say, in the vocative:
If you should happen to see Miss Page and
CarolyniSwift in Broadmoor, please give them my love.
I have a feeling that they probably are not there,
but am not sure just exactly what their plans are.
,

Drop the a. line how you are.
I do hope your
old enemy is not getting rambunctious again?

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Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102