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Misc. 34 Fl ',AL RESERVE BANK NEW YORK (TO BE MAILED) CONFIRMATION OF TELEGRAM We have today telegraphed you as follows : York, March 1, 1917. Benjqmin Strong, 4100 ::ontview Boulevard, Denver, Colo. Following telegram received from Paris today: Quote. Recevens votre telegramme annoncent decisionYederal Reserve Board. Stop. Semmes bien sises voir realiser projet dent le principe a ete concerne entre i. Strong et moi lore ue son dernier voyage a Paris. Stop. Vous remercions vivement votre emoresEement a nous aviser du succes de nos cothmunesde demerches. Stop. Signed, Georges Pallain." RHTPCM Charge Federal Reserve Bank, Equitable Building. 9-2 R. H. Treman. FEDERAL RESERVE BANK OF NEW YORK March 1st, 1917. Dear Governor Stro*15 1917 Government Bonds. Governor Rhoads expects to be here on Saturday, as well as Governor Aiken and I assume we will discuss the question of purchase of United States 2 bonds. I suppose for the present, until we know more about the proposed issue of new bonds by the Government, that we should do nothing towards the purchase of 2 version. bonds in the open market for con- Undoubtedly, if the new issue is made, we will have an opportunity during the year to pick up 2 % bonds below par. If you have any additional ideas on the subject, kindly advise me. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 1st, 1917. Dear Governor Strong: State Banks and Trust Companies. I have been talking with Jr. Jay about ways and means for securing expressions from state banks which are now members of the Reserve System as to their experience. I think I shall try and enlist the Ithaca Trust Company at home to send out some letters explaining that they have, as is true, considered joining the Reserve System, and they can very properly ask such banks for testimony as to their experiences in the System. I can also enlist George Allen who is now Secretary of the State-Bank Section of the A. B. A., and feel confident that he will write these letters for me also if I desire him to do so. In that way we can secure some testimony which may be of use in our campaign which should be developed later, but on the other hand, the present time is not opportune to push this in my judgement. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 :..icntview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March let, 1917. Dear Governor Strong: Investments. . I am pleased to note in yours of February 21st that you are satisfied with the line of bills we are carrying. Our pol- icy is not to buy any municipal warrantsat the present time. Mr. Cann's leaving will necessitate our securing another man to work with Mr. Kenzel and I feel that they should keep in touch with each other so that in case of illness or otherwise the other would be in a position to carry on the work. I am trying to keep in touch with Kenzel on these purchases and will advise him to keep well informed as to the makers and acceptors of the bills. In this connection, Mr. Jay and I had an hour's visit with Mr. James Brown of Brown Brothers, who made another statement to us and when Rhoads and Aiken are here I hope to arrange to have him make a statement to their banks along similar lines for their information. 6incerely yours, t*AAALLA____ Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCIA FEDERAL RESERVE BANK OF NEW YORK MAR5 191/ March let, 1917. Dear Governor Strong: I have been talking with Mr. Rovensky to-day about securing an expert young man who can handle our foreign exchange' matters, at least temporarily until your return and he has promised to look up such a man. for me. I shall probably talk with Mr. Kent a little about it also, but assume that for the present we do not need a high salaried expert capable of handling the matter without consultation, but rather at present one who has had special training in foreign exchange matters and is familiar with the customs of foreign banks and who could under such advice as we would secure from Mr. Kent or Rovensky on important matters, handle it until your return. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 MontviewBoulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 1st, 1917. MAR5 1911 Dear Governor Strong: Directors Meetirg. All the members were present yesterday except Mr. Palmer. After the usual routine business, there was some discussion as to the National Butchers er. Drovers Bank, to which bank we are loan- ing $300,000 to $400,000. They seem to be jr better condition than they were two or three years ago, but we are having Mr. Cann with two others of our force at the bank going over their matters more in detail, so we will be in a position to judge of their loans. No change was made in rates of discount and Governor Aiken advised me yesterday that they would probably reduce their rate today to conform to ours as they made an advance about two or three weeks ago and since then the Boston bills have been coming to New York to secure rates of 3 to 3* %, instead of the Boston rate of 3* to 3i %. We reported the status of negotiations with the Bank of France up to date. I stated that as there were some discrepancies in my letter to the Reserve Board in re cables to England, that next week I would like to submit a report correcting same to make our files in conformity with the facts. ^to FEDERAL RESERVE BANK OF NEW YORK cNiFi 2 Governor Strong. 2/1/17. I also reported the recommendations of the Committee of Governor Strong and "Judge Curtis" in re emergency preparation and read them my answer as giving the facts which, after being received, they discussed somewhat and there seemed to be a general feeling prevailing that we were giving the situation proper attention. Mr. Cann's resignation was accepted and the Secretary insturcted to prepare a suitable letter expressing appreciation of his work. We are now seeking another credit man and also will look up the question of a foreign exchange official. The Board, on Mr. Locke's motion, suggested keeping up to approximately ,100,000,000 of Federal reserve notes in New York, of which $25,000,000 might be in the Subtreasury. The Federal Reserve Vault will take care of about $92,000,000. Mr. Saunders was made a member of the Executive Committee in place of Mr. Towne. The meeting adjourned for two weeks, subject to call, however, if conditions changed. With best regards, I remain, Sincerely yours, Deputy G-IV-67717O-r. Benjamin Strong, Esq,, 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK 114)4 . MAR'S March 1st, 1917. 1917 Dear Governor Strong: Accumulation of Gold. Regarding the accumulation of gold, would state that we are working constantly on this matter and day before yesterday Mr. Jay had a long talk with Mr. Bovee who asked if we could store some surplus gold in our vaults for the Subtreasury as their space was practically all taken up now. We are going into the matter further but personally I should prefer to purchase additional gold bars even if we accumulated t75,000,000 or more rather than to have our vaults filled up with gold belonging to the Treasury for the care of which we would be responsible. We are constantly at work on the gold situation and if you think it unwise to accumulate as much as t75,000,000, please advise. My best regards. Sincerely yours, fe,g Deputi-Z-4Nli:nor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March let, 1917. Dear Governor Strong: Amendments to the Federal Reserve Act. I understand that they are having much trouble in Washington concerning the passage of the proposed Reserve Act amendments. They have finally lined up the Rules Committee of the House which hassgreed this week to send their consideration, but frankly, at present it seems extremely doubtful that they will get through this session. This may not be an unmixed evil as there are many bankers who feel that it would be well if the Reserve Board did not push so fast in these changes but let them come more gradually And allow those affected to see the wisdom of their enactment. From various sources of information, I am impressed with the strain under which the members of the Federal Reserve Board are now working and am taking the liberty of suggesting to you that in your correspondence with they that for the present you put things mildly and not raise issues unless you think it imperative to do so, as I believe thIA after Congress adjourns and they have time for rest things will receive better consideration as they will be under less irritation and pressure. FEDERAL RESERVE BANK OF NEW YORK To "2 Governor Strong. 3/1/17. I expect that one of the points about which Aiken desires to confer with Rhoads and me on Saturday is the apparent change in policy which has taken place in Washingtpn and after that interview can perhaps give you some light on their view. My very best wishes. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Form 1294 WESTE 'VICE ssage der SYMB° Blue Night Message Nite Night Letter NL UNION TEL If none of these three symbcls appears after the check number of words) th Is Is a day message. Otherwise its character is Indicated by the AM Mann BiiANQH OFFICE. Day Message Day Letter Blue Night Message Nile Night Lotter If none of those three symbol appears after the check (number of words)this Ise day message. Oth erwise its character is indicated by the NEWCOMB CARLTON, PRESIDENT symbol appearing after the check. CLASS OF SERVICE SYMBOL symbol appearing after the check. 230/ %. L'uu YORK 2545. 32D AG 60 BLUE MAKIONS F NEW YORK NY MAR BENJAMIN STRONG `-.3 c./ 1 445 1917 C . ./. 4100 MTVIEW ST DENVER COLO Act Teener, . 4*.v. FOLLOWING TELEGRAM RECD FROM PARIS TODAY QUOTE RECEVENS VOTE k.4.t.t.4Q , P4,0, /30,,,,,) et-t-e4:44-11/4. 144"4141"4 4-4-('1,44447ELEGRAMM ANNOUNCMENT DECISIOU FEDARAL RESERVE BOARD STOP SOMMES 4,(; c ter"p____"4: ,/,',7,c,;_tt:,(Aft.r. ,t. ir, ,h) , l'un ATr,,,r).6i2c rff)\-ce-A h-r, BIEN AISES VOIR REALISER PROJECT DONT LE PRINCIPE A ET E CONCERCE v?t 7 *??\.4.- to it, 4.A.tr 4:41-:) -,t4 iqww, taatt- - t ., c; , ENTRE M STRONG ET MO! LORS DE SON DERNIER VOYAGE A PARAS STOP -7g- VOUS REMERC IONS VIVEMENT DE VOTRE EMPRESSAENT A Irr- ' - 0A-etc-to AVISER DU SUCCES DE S , COMMUNES DEMARCHES STOP NOS GEORGES PALLAIN NOUS 01:01,- R H TREMAN 343PM SIGNED FEDERAL RESERVE BANK OF NEW YORK March 2nd, 1917. Dear Governor Strong: Preparedness. Answering yours of February 23rd, I am glad that you approved of the plans we had already made before we received your special communication. In addition to what I wrote yo a description of the Directors Yeetin , yesterday in giving I want to add that Curtis is looking after the perfecg of police arrangements and equipment through some of th/other officers so I think you can rest assured that thesp matters are all being careful- / ly considered and will be fo lowed up. My very best re rds. Sincer ly yours, Deputy Governor. Benjamin Strong, E q., 4100 Montview Bo levard, Denver, Colora o. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 2nd, 1917. Dear Governor Strong: Regarding our gold accumulation, we have sent all the German coin we have over to the Assay Office for remelt. Yes- terday, we had inquiries from one or two parties about the French coin and made numerous inquiries from different ones as to whethus er our selling French coin would aectAin any way detrimentally and were advised by Mr. Rovensky . James Brown, Mr. Hamilton and others that they see no regtson why we should not sell it as a commercial transaction. Roveneky felt ±It we should hold some English, French and possibly some Germanicoin as a matter of accomodation, from one standpoint, but mo e because of ecomomic waste in remelting, as it will undoubted be needed as soon as peace is declared because so much coii has been withdrawn from circulation and other amounts remelted. We ar,/ receiving bids to-day for four millions plus of French coin and have assigned to Mr. Jay the question of accumu- lating gold b/ars, etc., and he will undoubtedly write you in detail. With kind regards, I remain, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. http://fraser.stlouisfed.org/ Federal Reserve Bank of St.R.111/VCM Louis FEDERAL RESERVE BANK OF NEW YORK Larch 2nd, 1917. Dear Governor Strong: Answering yours of February 21st in re Federal reserve bank drafts would state that I am scuring a num- ber of suggestions from the various Governors and having them tabulated and condensed by Lr. Hendricks in preparation for the meeting of the Governors/Committee to be held on or about March 15th. I have advised Governot Harding that we were contemplating having this Governors Conference about the middle of March. From a letter setyt out by Governor Harding and a talk he had with Mr. Woodwal4 on Sunday he intimated that ow- ing to the unsettled condi ions and the fact that possibly they may change overnight heir posts and that they should not Governors to remain at come on from the West the Board thought it wise for the nd South for a conference at the pres- ent time. Aiken e idently feels that there is quite a change in the attitude ofithe Reserve Board, but I am inclined to think thnt when the Governors need a conference there will be little difficul/ in securing one and I think the argument in regard lo the ,$restern Governors coming East just now a sound one. Sincerely yours, Benjamin Strong, Esq., 4100 Eontview Boulevard, Denver, Colorado. Deputy Governor. FEDERAL RESERVE BANK OF NEW YORK March 2nd, 1917. Dear Governor Strong: I have yours of Febr ments upon Mr. Peples Memora y 26th with com- um in regard to Fed- eral reserve exchange and same will be incorporated in our brief which Mr. me to submit to the endricks will prepare for overnors Committee. incerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 M ntview Boulevard, Deny r, Colorado. RHT VCM FEDERAL RESERVE BANK OF NEW YORK March 3rd, 1917. Dear Governor Strong: I have your favor of February 27th and note that you do not approve of the way in which the st.b.,tement of the bank is furnished to the newspapers. On receipt of your for- mer letter upon this subject, I turned it over to Mr. Jefferson for him to consider and adopt the proposed form suggested by you. till take the matter up again and endeavor to have your suggestions complied with without futther delay and if there is any reason why the office does not agree with you, we will take it up later. Governors Aiken, Rhoads and McDougal are here for a conference to-day and this morning I received a cordial letter from Governor Harding stating that he assumes I will not hesitate to call the Gpvernors Committee together whenever I deem proper to do so and he will send over 1;q Attebery of St. Louis, who has been drafted for temporary use by the Federal Reserve Board from the Federal ReserveBank in St. Louis. We are having regular March weather and are glad that you are away from it. With kind regards, I remain, Very truly yours, Benjamin Strong, Esq., 4100 nnitview Boulevard, Denver, Colorado. FEDERAL RESERVE BANK OF NEW YORK March 6th, 1917. Dear Governor Strong: I had a very nice talk with Mr. Cann tip-day assur- ing him how greatly we would miss him and reiretted his going, but that we could not wish it other ice as he had such a good opportunity offered him. seemed to appreci- ate greatly the letter you had sent to him and the resolution passed by our Board of Director /and the granting him, as Mr. Sailer and I decided to d the balance of the month, which , payment of his salary for e stated was entirely unex- pected. We have several names under consideration for the position of credit man and ho e to report some progress in this matter soon. Sinc ely yours, Deputy Governor. Benjamin Strong, Es 4100 Montview Boulevard, Denver, Colorado. RHT/VCM h,41. FEDERAL RESERVE BANK OF NEW YORK MARI 5 191/ Larch 6th, 1917. Dear Governor Strong: Statements of Condition. I am enclosing herewith a revised form of statement of condition of the Federal Reserve Bank of New York for your consideration and criticism. If any changes occur to you which you think it desirable to make, kindly advise me. Jefferson states that one reason for carrying the statement in the form used last year was that at that time we had not charged off our organization expenses. Now, how- ever, they have been charged off and we have no item of this character except the cost of unissued Federal reserve notes, (which we must necessarily carry as an asset), and he hopes the present form will be more in accordance with your views. If not, please let me know. Sincerely yours, - Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Eric. FEDERAL RESERVE BANK OF NEW YORK March 6th, 1917. DearGovennor Strong: Bank of France: Answering your favor of February2lst in re Bank of France I turned same over to Mr. CWitis who has secured from Monsieur Masson a statement as to the French law per- / tainingtoexportsofgoldandllr4Curtis assures me he has given attention to the othedi matters suggested in this letter. Sincerely/yours, .... "?'EA4AJ4-1- Deputy Governor. Benjamin Strong, Es q, 4100 Montview Boul4vard, Denver, Colorado. RETPCM /// FEDERAL RESERVE BANK OF NEW YORK March 6th, 1917. Dear Governor Strong: I remained in New York on Saturday meeting with Aiken, I assume Curtis has written you McDougal, Rhoads and Curtis. concerning this meeting as I returned to IthaFfi Saturday night and came back again this morning. /I Aiken indicated a desire to talk/#1th you on some mat / ters and thought he would endeavor to mAet you in Chicago soon. I hope you may enjoy each Other and y ur meeting result in good. I note what you say in reged to the sentiment which is attached to the arrangement betweAn the Bank of France and the Federal Reserve Bank of new and insofar as I have sent any Yo/ letters to Monsieur Pallain I/ilave tried to recognize the need i for extreme courtesy and expi.essions of good will. / We will be very glnd to carry out th4 thought hereafter. / Mr. Jay is not dAwn today having had a little upset ,1 from a luncheon yesterday with two Japanese and Kenzel, the Jape being the manager of/he Yokohama Bank here and his successor who is to be here fqr six months while the present manager is in Japan. We expec to have a meeting on Monday, Larch 19th of the Committee on Federal reserve bank drafts and hope that we may EDERAL RESERVE BANK OF NEW YORK -2- To Mr. Strong. 3/6/17. reach a harmonious conclusion and be able to develop a plan which if put into effect will prove sound and workable. hope that yourgain is constant and with our best wishes, I remain, Sincerely yours, ae)(71,(_Th Deputy Governor. 3enjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM POSTAL APH TELEGRAM .ECEIVED AT MAIN OFFICE (NI COMMER CLARENCE H. MACKAY, PRESIDENT. CRANNIER BUILDING ,c0 17TH STREET DENVER, COLO. TELEPHONE: MAIN 4500 The Pdstal Telegraph-Cable Company(Incorporated)transmits and delivers this message subject to the terms and conditions printed on the back of this blank MO-2Q019 98-cbho DESIGN PATENT Na, OUP 42 1138a 1d cb-New York Mar 8-17 Benjamin Strong Ttlgv11-10N Esq .0-g- 4100 Montview Blvd Denver Colo pea.- By Curtis absent today think you misunderstood purpose of Ti: fUe is telegram yesterday stop Question is shall we insert words quote earmarked or end quote before word shipped in last sentence to correspond with similar provisions paragraph twelve E paragraph eleven D please wire. R H Treman 7 POSTAL TELEGRAPH-COMMERCIAL CABLES 1 ) PACIFIC .. VANCOUVIL OCEAN APAN 10 5 (',,,,AYoKOHAIJA ...... Fiir SAM CRAM elFtgovOn DWAse ATLANTIC OCEAN St vJ sceNT 411. THE GREATEST TELEGRAPH ANDCABLE SYSTEM. IN THE WORLD,. . EXTENDS OVER TWO-THIRDS OF THE WAY AROUND. THE EARTH. THE POSTAL TELEGRAPH-CABLE COMPANY (,INC_RPORATED) TRANSMITS AND DELIVERS THE WITHIN TELEGRAM SUBJECT TO THE FOLLOWING TERMS AND CONDITIONS: To guard against mistakes or delays, the sender of a telegram should order it REPEATED; that is, telegraphed back to the originating office for soMparison. For this, one-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNR.EPEATED TELEGRAM AND PAID FOR AS SUCH., in consideration whereof it is agreed between the Sender of the telegram and this Company as follows; of any UNREPEA.TED telegram, beyond the I. The Company shall not be liable formikaltes or deraya in the transmiglion or delivery, or for non-delivery, 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 sum received .f or sending the same, UNLESS SPECIALLY VALUED; nor in any ease for delays arising from unavoidable interruption in the working of its lines; NOR FOR ERRORS IN CIPHER OR OBSCURE TELEGRAMS. 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 telegram, whether caused by the negligence of its servants or otherwise, beyond fifty times the REPEATED telegram rate, at which amount this telegram, if Bent as a REPEATED telegram, IS hereby valued, unless a grater 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 Bach value equal to one-tenth of one per cent. thereof. when necessary S. The Company is hereby made the agent of the sender, without liability, to forward this telegram over the lines of any other Company to reach its destination: charge will be 4. I'dessages will be delivered free within the established free delivery limits of the terminal office. For delivery at a greater distance a special made to cover the cost of such delivery. No responsibility regarding messages attaches to this Company until the same are presented and, accepted at one of its transmitting offices; and if any oleaSage is sent to such office by one of this Company's messengers, he acts as the agent of the sender for the purpose of deliveringthe message and any notice Or Instructions retarding it to the Company's agent in its said °lice. days after the S. The Company shall not be liable for damages or statutory penalties in any case where the claim is not presented in writing within sixty telegram is filed with the Company for transmission. 7. The above terms and conditions shall be binding upon the receiver as well as the sender of this telegram. S. NO EMPLOYEE OF THIS COMPANY IS AUTHORIZED TO VARY, THE FOREGOING. ) CHALES'L.. ADAMS, CLARENCE H. MACKAY, PRESIDENT. EDWARD REYNOLDS, VICE-PREST. AND GENERAL MANAGER. CHARLES P. BRUCH, VICE-pRESIDENT. TVIE FASTEST TELEGRAPH SERVICE IN THE WORLD 1166, OPERATOR'S NOTATIONS. TIME SENT, ETC. Form 1201 OF SERVICE ESTEOANI UNION TEL AM SYMBOL 3 Message Dat Blue Night Message Nite Night Letter NL Day Message WESTERN UNION w. If none of these three symbols appears after the check number of words)this is a day message. Otherwise its character is indicated by the symbol appearing after the check. CLASS OF SERVICE SYMBOL NEWCOMB cARLTON, PRESIDENT GEORGE W. E. ATKINS. FIRST VICE-PRESIDENT RECEIVED AT 915-91 9 SEVENTEENTH ST., DENVER, COLO. Day Letter Blue Night Message Nile 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 after the check. ALWAYS OPEN 221NY AZ 30 BLUE Q NEWYORK NY 330 PM MAR 8 1917 BENJ STRONG 952 4100 MONTVIEW BLVD DENVER COLO 'AM GLAD YOU AND AIKEN WILI MEET IN CHICAGO STOP HAVE EXPRESSED VIEWS FREELY TO AIKEN STOP IF ANY FURTHER SUGGESTIONS CUR TO ME WILL ADVISE YOU AT CHICAGO R H TRE,U 237 PM FEDERAL RESERVE BANK OF NEW YORK March 8th, 1917. Dear Governor Strong: Investments. We are running rather light at the present time in / the matter of purchase of bills because the market is about 1/8 below us. We don't however see any necessity for "reach- ing" for bills, as under present conditions e may have a change any moment which will bring large ,eferings to us. It is our desire, however, to eep a sufficient amount invested to pay our expenses arid our dividends and we may seem otherwise. have this always in mind although Mr. Jay has agreed to tae up with the Reserve Board promptly the question of a move/to induce state banks to come in and I shall confer with hirptto keep the thing in mind. Sincere yours, Deputy Governor. Benjamin Strong, Esq., 4100 rontview Boule7rd, Denver, Colorado. RHT/VCM Misc. 34 P.VRAH Postal FEDERAL RESERVE BANK OF NEW YORK (TO BE MAILED) 1 p.m. CONFIRMATION OF TELEGRAM We have today telegraphed you as follows: Benjamin Strong Esq 4100 Montview Boulevard Denver Col. Curtis absent today Think you misunderstood purpose of his telegram yesterday Stop Question is shall we insert words Quote earmarked or end quote Lefore word shipped in last sentence paragraph twelve E to correspond with similar provisions paragraph eleven D Please wire R. H. Treman Charge Federal Reserve Bank, 120 Broadway Digitized B-2 for FRASER Min. 34 FEDERAL RESERVE BANK OF NEW YORK (TO BE MAILED) CONFIRMATION OF TELEGRAM We have today telegraphed you as_11q11,WSTER RHT/VCM 3 P. Id. March 8, 1917. Benjamin Strong, 4100 i.:0ntview Boulevard, Denver, Colorado. Am glad you and Aiken will meet in Chicago. Stop. Have excressed my views freely to Aiken, Stop. If any further suggestions occur to me will advise you at Chicago. R. H. Treman. Charge Digitized B-2 for FRASER Federfil Reserve Bank, Equitable Building. FEDERAL RESERVE BANK OF NEW YORK March 8th, 1917. Dear Governor Strong: Bank Organization. You asked the about matters pertaining to our organiza- tion and I am glad to give you some information herewith: Manager Credit Department: I have been making some in- quiries up the state and also in the city and a number of names are being investigated at present. Foreign Exchane Clerk: We have one young man under consideration whom we expect to call upon Mr. Sailer this week. He was recommended by Yr. Rovensky. Efficiency: I have had talks at different times with Mr. Sailer about making our organization more efficient. We re- alize that in the rapid development, we hnve taken on more employees to perfect the work than perhaps is necessary under normal conditions and at the present time, under Mr. Jefferson's supervision, there are one or tvo men studying each department in detail and this will be continued throughout the different departments. Bank Examinations: We have already secured information as to banks in this district that need more frequent examinations and are being supplied with information from time to time but as a result of cur talks with Mr. Malburn, we realize that we must be patient until he can secure a better grasp of the situation. FEDERAL RESERVE SANK OF NEW YORK -2 To Emergency Preparation: Mr. Strong. 3/8/17. At our officers' meeting this morning, it was reported that most of the employees are now coming in through the fifth floor entrance; additional police guards are now on duty and will not be changed with out our knowledge and we are having three uniforms for use of the inside force prepared. We are now considering plans for building two additional inner vaults in our large vault down stairs, the two vaults to be equipped for the purpose of storage of gold coin and bullion. Transit Department: The Transit Department is doing good work I think, and we are prepared to handle twice the present volume on four or five days Additional Space: notice. We are to recommend to our Directors at their next meeting the securing of additional space along the discount and note departments so as to have about double the capacity for handling our present volume. Private Bankers' Statements: All private bankers who have already made statements to us have brought them up to date except Messrs. J. P. Morgan & Company and Messrs. Muller, Schall & Company. Mr. Jay has not yet spoken to Mr. Morgan but expects to do so shortly.. No decision has been arrived at regarding the statement furnished by Messrs. Muller, Schell O.: Company last Fall, and they have not been requested to make a statement as of December 31, 1916. 3 ..4ERAL RESERVE BANK OF NEW YORK To Mr. Strong. 3/8/17. Messrs. Sutro Brothers & Company recently filed a statement with 1r. Cann which has not been considered as yet. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Form 1217 CLASS OF SERVICE DESIRED Fast Day Message Day Letter WESTE4aisNA UNION AM TEL WESTERN UNIOW Night Message Night Letter Patrons should mark an X opposite the class of service d sired: OTHERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. Cev Receiver's No. Check Time Filed NEWCOMB CARLTON. PRESIDENT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to New York City, March 8, 1917. 4011 Benjamin Strong, Denver. Curtis absent today. yesterday. Stop. Think you misunderstood purpose of his telegram. Q,uestion is shall we insert words "ear-marked or" end quote before word shipped in last sentence paragraph 12 (e) to correspond with similar provisions paragraph 11 (d). Please wire. R. H. Treman. `-....-., 401 ALL TELEGRAMS TAKEN BY THIS COMPANY A11E 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 .1s, all the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FOR AS isideration 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 :ed 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 :riding 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 :ms. 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 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 :g 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 er cent. thereof. The Company is hereby made the artnnt of the sender, without liability, to fbrward this telegram over the lines of any other Company when necessary to reach its :ation. 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 set 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 e 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 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 -cooing terms. No employee of the Company is authorized to vary the foregoing. THE WESTERN UNION TELEGRAPH COMPANY INCORPORATED NEWCOMB CARLTON, PRESIDENT CLASSES OF SERVICE 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 trans- T DAY MESSAGES ull-rate expedited service. HT MESSAGES cepted up to 2.00 A.M. at reduced rates to be sent during the night elivered not earlier than the morning of the ensuing business day. LETTERS deferred day service at rates lower than the standard day mesrates as follows: One and one-half times the standard Night rate for the transmission of 50 words or less and one-fifth of itial rate for each additional 10 words or less. SPECIAL TERMS APPLYING TO DAY LETTERS: further consideration of the reduced rate for this special "Day r" service, the following special terms in addition to those enued above are hereby agreed to: Day Letters may be forwarded by the Telegraph Company as a ed service and the transmission and delivery of such Day Letters all respects, subordinate to the priority of transmission and ry of regular telegrams. Day Letters shall be written in plain English. Code language permissible. This Day Letter may be delivered by the Telegraph Company ephoning the same to the addressee, and such delivery shall be a ate discharge of the obligation of the Telegraph Company to This Day Letter is received subject to the express understandd agreement that the Company does not undertake that a Day mission 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 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 "Night 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. FEDERAL RESERVE BANK OF NEW YORK March 8th, 1917. Dear Governor Strong: f March 4th in re Mr. McDougal's efforts I have yours and note your comments ith which I agree. Garrah, Chairman of the letter sent out by Mr. Mc I sent to r. Mc- earing House Committee, a copy of the ugal to the state banks recommending that they have printed on teir checks "Payable in New York Exchange at Current Rates" and this morning was advised confidentially that Mr. McDougal was New York yesterday, attended a - conference (I assume of the St te Bank Executive Committee), and that he finally admitted that bably he had been wrong in tak- ing the position he had, so I thi k the matter is moving along in the right direction and will be killed off. This morning we had a disc,ssion at our officers meeting and reached an unanimous conclus on that the time had come to move to collect chagks on all bank in our district and that we would once more write to those stats banks that had declined to remit at par, stating that we were i augurating this plan to collect all checks and ask them to join o the extent of remitting at par for their own checks sent them; t1en to proceed with this plan about the 1st of April, collecting most successfully. 1:4.1 such wny as we can do We also hope to indt4e the Philadelphia and Cleveland banks to inaugurate the same pl n in their districts about April 1st, joining with us in this ovement. _ FEDERAL RESERVE BANK OF NEW YORK -2- To Mr. Strong. It is clearly our duty to go ahead now. 3/8/17. Governor Hard- ing suggested to us the latter part of January that we had better postpone taking any decisive steps until after the Congress had adjourned, but now we should proceed withoUt further delay. agree with you that it is the psychological time. Yr. Wills from Cleveland is to be in New York to-morrow and we hope to see him in reference to this matter. bincerely yours; 0-6V-V=444"Th Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCN FEDERAL RESERVE BANK OF NEW YORK March 8th 1917. My dear Governor: Bank of_Euland Cableee. I note your suvestions if March 4th and will bring your letter to the attenti n of our Board of Diredtors at their meeting next eek. At that meeting, I expect to present a stateme t in writing to correct the error e in facts in my 1 tter to Washington. As to what further action should then be taken, it seems to me the Board must decide aft r a free exchange of views and I shall present your viers to them. With kind re rds, I remain, S' erely yours, ak-gt10/444.--, Deputy Governor. Benjamin Strong,, sq., 4100 Montview Bybulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 8th, 1917. Dear Governor Strong: Bank of France. I have yours of March 3rd in re lettqt to Monsieur Pallain. This letter was considered yeste/day by Curtis and Jay,and Jay has been over their conclusi ns with me to-day and I think we shall get the letters to-morrow morning after receipt of off this afternoon or 6ur advice by wire, for which we are now waiting. Possibly Mr. Curtis ma have written you, but he contemplates sending three co ies, one of which will be forwarded through the French AMipassador, as you suggested. We do not think and are doing our best ou overcautious about these details have them correct, but in any event, I assume they are sublAct to revision in minor details when presented to our Board for fianl approval. ncerely yours, Deputy Benjamin Strong, Esq., 4100 Montvietir Boulevard, Denver, Colorado. RHT/VCM Governor. FEDERAL RESERVE BANK OF NEW YORK March 8th, 1917. ,/ Dear Governor Strong: I ammnding copies of today's letters to Chicago ( though the originals are going to Den- ver for your files), thinking you may want to take up with Governor Aiken some of these matters. Talk with Aiken about the Federal reserve draft matter which will come before the committee on Monday, March 19th. asit Sincerely yours, Deputy Governor. req., Benjamin Strong, 4100 Montview Bo'ulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 8th, 1917. Dear Governor Strong: Foreign Banking Connections. I note from yours of March 3rd that you will prepare a sketch of letter in the Argentina matter. Our Executive Committee discusse our foreign banking relations and decided that for the present, until matters were settled with the Bank of England and the Bank of France, they deemed it unwise to attempt arrangements with other banks during this present period of uncertainty. As to the Philippine Bank matter, I asked Mr. Jay some time since to take charge of this and consult with Dr. Willis when he was in Washington. Dr. Willis is to be in New York tomorrow and I hope that we can reach some definite conclusion with him as to steps that should be taken, although Mr. Woodward, I am confident, feela that for the present it would be wiser to withhold all these matters at present except the Bank of England and Bank of France. If you feel that there are any banks with which we should begin negotiations, please advise me so that we may take same under consideration. There is a feeling on the part of some of our Directors that just at present, it would be more advisable to have FEDERAL RESERVE BANK OF NEW YORK 2 To Mr. Strong. 3/8/17. the foreign banks open negotiations with us rather than our seeking to do so with them. What are your views on this point? Sincerely yours, Deputy Benjamin Strong, Esq., 4100 Yontview Boulevard, Denver, Colorado. RHT/I/CM GoVeT7i. FEDERAL RESERVE BANK OF NEW YORK atfr March 9th, 1917. ofki 5 1917 PERSONAL. My dear Governor: Your letter of March 5th came in this morning in which you stated your own plans were indefinite until you could consult with your doctor. I feel very strongly, as I have indicated to Governor Aiken, that it would be well for you to come to New York in May ...if you can so arrange for the purpose of conferring with the of- ficers here, also, to spend some in Washington in order to pick up the broken threads and to arrange for such organization in New York as you deem best. In case Governor Aiken should decide not to consider that proposition, it has been intimated that a shift of Mr. Jay might be advisable, making him Deputy Governor in my place, but if this should be considered, much thought in my judgement should be given to the question of the appointment of his successor as Federal Reserve Agent. It would seem to me wise to secure a good, well-trained banker of from 35 to 40 years of age who, while not capable at present of doing more than perhaps carrying routine matters successfully, has shown ability to develop and if he could have this training under you and associated with Jay and Curtis, he ought surely to develop quickly, if he has it in him. With such a man To FEDERAL RESERVE BANK OF NEW YORK Mr. strong. 3/9/17. if you should after a few years feel disposed to retire and Aiken was still in Boston he might be called over as head of the bank and this Deputy Governor would be invaluable to him. Think this over as I inferred from my talk with Governor Aiken that he was not disposed to consider the matter favorably now. If you come on in May and spend a month or so between ashington and New York, it would enable you to shape up matters so that then you could be absent for a month or two in the Summer during the heated period and perhaps in August go abroad if conditions at that time were favorable to such a trip. I am strongly of the opinion that you should not consider taking the trip in June or July because of the present disturbed conditions and especially because of your health. Take a little more time to develop surplus strength and it will pay you in the end. Moping you will have a fine visit with Governor Aiken nd with my very best wishes, as always, I am, Sincerely yours, enjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 9th, 1917. My dear Governor: ' Government Bonds. Nothing new has developed 0th r than the newspaper reports that we are to have an issue of e150,000,000 one year, 3 per cent. notes. I h ve felt for some time that they would probably issue o/ year note to cover tem- porary demands, leaving the qu stion of bonds to be brought up later. Sincere yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boule ard, Denver, Coloraao. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 9th, 1917. I/ My dear Governor: Accumulation of"Gold. ;- Answering yours of Mar 5th would state that Mr. Jay is handling our gold q cumulation matter now so I will leave this correspqndence to him and you. Sincerely y urs, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulev r Denver, Colorado. FEDERAL RESERVE BANK OF NEW YORK March 9th, 1917. My dear Governor: I am delighted to hear through your letter of :. arch 5th that your health is coming along all right and I certainly hope that you will let nothing interfere with it. It is largely a mat/ ter of your ownidetermination and creation. I am glad to note that your corresponden e with Washington has been of such a satisfactory and tempered character and hope that youranticipated visit from a member of thitBoard may material- / ize. Mr. Warburg may come over to New York/next week and Governor Harding telephoned Mr. Jay yesterday that on the 19th. Mr. Jay replied that that would meet here on the Federal reserve might be a good thing to have Governo e would probably be here as the day the Governors ank draft matter and it Harding here to hear the dis- cussion. I leve in a few moments Acceptances at which there will b pttend a conference on Trade present those who have taken an important part thus far in an ef ort to educate business interests to the value of their use. WI is of Cleveland and Curtiss of Bos- ton are to be here, also, Raymond B. Cox of the Webster-Atlas National Bank and one or two fro With kind regards, Cincinnati and others. remain, Sinc rely yours, Benjamin Strong, Esq., 4100 Yontview Boulevard, Denver, Golorado. RHT/V0M Deputy Governor. FEDERAL RESERVE BANK OF NEW YORK March 9th, 1917. My dear Governor: I have yours of March 5th and have lready written you concerning our moves to secure /a successor to Mr. Cann. We are also awaiting a call this week from a party whanwe are investigatang as a for- / eign correspondent man. Regarding the Federal rese;ive notes would state that $600,000,000 seems excessive, but it seem- / ed to be the judgement of .a numVer of our Directors so I did not oppose it, as if here was an error it was on the safe side. I have noted also $50,000 to $55,000 per mo ur earnings of about h, but think we must judge results by a six months period and am inclined to think that during the year we/will have but little difficulty in keeping up our earn ngs at good rates. Sin erely yours, )1A-4AA-___ Deputy Governor, Benjamin Strong,* Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 9th, 1917. My dear Governor: Philippine Bank. I beg to acknowledge receip your favor enclosing copy of letters from and/to Dr. Willis in re Philippine matter. I hope to see Dr. Wi lis to-day at the Trade Acceptance Conventiori and will endeavor to have / him come down to the Ban of a conference on this sub- ject. Sin erely yours, Deputy Governor. Benjamin StroW , Esq., 4100 MontvieW Boulevard, Denver, Colorado. RHT/VC 667 )-Y.t- ,.//V CCO-4-AA - A-tat /0( ACy Afy FEDERAL RESERVE BANK OF NEW YORK AVArVarch 13th, 1917. MAR16 1917 My dear Governor: Just received your telegram stating that you would write fully regarding Aiken on your return to Denver. I will try and arrange for your telegrams to be sent via Western Union. It was probably not realized in the of- fice that it made any difference. I hope that you had a satisfactory visit with Aiken and McDougal and we are looking forward to seeing them both on Monday next. I note what you say about an effort to build up our investment account and will bring this up for consideration tomorrow at our Directors Meeting. You have asked whether conditions have permitted me to play a little golf yet and in answer will say that I have had it only in imagination. I derive pleasure, however, from hoping that during the Spring and Summer I can do more than I did last year, but the opportunity has not yet developed. These days you can appreciate we do not have much peace of mind if we are away very far from the bankwhen things are liable to change any day. At present, I am feeling well and hope it continues. Sincerely yours, A2)74,21440-14-------Th Deputy governor. Benjamin Strong, Esq. 4100 Montview Boulevard, Denver, Colorado. FEDERAL RESERVE BANK OF NEW YORK MAR19 1917 March 14th, 1917. My dear Governor: Mr. Jay received word from Mr.Warburg that he would be at the bank tomorrow, Thursday, as he was coming to New York this afternoon. We have heard nothing from Governor Aiken yet, although I wrote him asking him to dvise me of his visit as soon as he reached home. Mr. Palmer told me that he had met you in Chicago and thought you were looking very well, in fact, better than he personally had ever seen you look. We are investigating various credit men to take Cann's place and are following up two or three leads which promise somewhat favorable results and I expect to have a conference this afternoon with Messrs. Jay, Curtis, and Sailer concerning this. The party whom we were looking up for foreign exchange work does not seem to promise well and we are now working along other lines. It seems difficult to secure a good foreign ex- change man unless he is a German. With my very best regards, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK arch 14th, 1917. hdP My dear GoveNWR1 9 1917 Directors Meeting, March 14th. All present except Lessrs. Locke and Woodward, Mr. Locke hnving a cold and Mr. Woodward being in Boston attending P busi- ness meeting. I mm sending herewith a memorandum of the increases and decreases since the last Directors meeting. No change was made in the rate of discount. I read extracts from your letter in regard to our in.vestments but the general feeling among the officers of the bank at present is that the open market, owing to temporarily easy money and the desire of the banks to absorb very liquid and short time maturities, we should keep out of at the present,anticipating that around April let conditions may be more favorable for our repurchases of acceptances. The officers were authorized to subscribe for the renewal of our 3 '7. one year notes in April to the extent of about 0_,500,000 which will mature at that time. I had intended to bring up the question of the Bank of England cables but as Messrs. Woodward and Locke were away, thought it wiser to postpone it until the next meeting. I OF NEW YORK "2" To 3/14/17. Governor Strong. Mr. Jay reported the effort he was making through Secretary McAdoo to remit the Assay Office charges in connection with our accumulation of gold. In this connection, Mr. Gar- dine and another gentleman from the City Bank came over this morning to suggest that the Federal Reserve Bank take the sovereigns and francs which are coming in now, either keeping them or arranging with the Subtreasury to hold them for a period until after the war, thus saving the economic waste caused by their being re-melted and re-coined. We presented the Philippine National Bank matter and reported as to Dr. Willis' visit here last week. Mr. Curtis raised the point that the Philippine National Bank was not a foreign bank and we are straightening out this legal question before we make formal application to appoint it as our agent. We discussed the question of the use of express companies in collecting checks on state banks where we are still unable to make collections at par - (there are about 100 such state banks)and the Board reiterated their authority to the officers to proceed to make these collections through the express companies or otherwise if we deem it best. The Board adjourned for two weeks subject to call if necessary. Sincerely yours, Deputy Governor. Benyamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Enc. FEDERAL RESERVE BANK OF NEW YORK Ailkarch 20th, 1917. MAR2 ?l90 My dear Governor: Governor Harding is looking much better and seemed to be in good spirits yesterday. jay and Curtis took Govern- or Harding Harding and two or three of the other Governors to the theatre last night. To-day we are to give Governor Hard- ing a luncheon at the Bankers Club, having besides Woodward, Curtis and Jay, Messrs. Vanderlip, Alexander and Townsend. Gov- ernor Harding also had a talk with Mr. Morgan yesterday and will meet other bankers to-day. Later. We had our luncheon to-day and think it was quite successful. Governor Harding intimated that the Secretary of the Treasury might put out approximately $100,000,000 of temporary notes, payable about July 1st at the time the income tax returns come in, but he, the Secretary, felt that the Federal Reserve Banks might underwrite these proportionately, which would make perhaps $40,000,000 for us to take in New York; and further, that the Secretary felt that the rate should be 2 %. we took them at 2 %, it would be about right, to which Governors McDougal and Famcher agreed. Jay and I felt that if At the luncheon Mr. Vanderlip felt 7- 4r**t ........" ,.....z, V FEDERAL RESERVE BANK OF NEW YORK -2- To Mr. Strong. 3/20/17. '4( that they might go at 2 %, while Mr. Alexander said not less than to which Mr. Woodward also agreed. At the luncheon, there was an exchange of views regarding amendments, especially the reserve amendments and Governor Harding stated that they would send over to us as soon as they were framed up, the proposed amendments and ask that the New York bankers formulate their views or send some representatives down to Washington to discuss the amendments there. After luncheon, we took lessrs. Alexander and Townsend down to the vaults and up to our collection department, with which they apparently seemed well pleased. We go along from day to day here in suspense, not knowing what will take place the next, but working things out as they arise to the best of our judgement. Sincerely yours, 71./W24444,214.4._Th Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 20th, 1917. My dear Governor: I spent Saturday and Sunday in Atlantic City, returning yesterday morning for the meeting of the Committee of Governors in re Federal reserve exchange. There were present Governors Aiken, Rhoads, Seay, Fancher, McDougal and Governor Harding, as well as Curtis and myself. We took up the report of the Committet as made at the Washington meeting, discussing each paragraph and by consent of the members invited Messrs. Woodward and Jay in to present the views of the Directors of the Federal Reserve Bank of New York as, of course, my position, as well as that ofiliendricks, being that we were com- mitted to the report of the G vernors made in Washington. We discussed the mftter -from about 11:30 A. M. to 5:30 P. L. and reached practica a unanimous conclusion so far as the members of the CoMinitlee were concerned, Aiken siding rather with Woodward and Jay in/their position, but the others feeling that the important thing was to have double advice and then make the checks receivable thus avoiding the responsibility for for- gery, etc., by making them payable. I will son" you a copy of the minutes when they are prepared by Curtis and,/advise that we shall have a Governors' Confer- / ence probably the/early part of April in Washington at which the _RAL RESERVE BANK OF NEW YORK -2 Er. Strong. To 3/20/17. matter will be finally considered and the views of the other six banks can be presented. I hope the results of the conference yesterday will meet with your approval but if not will be glad of any suggestions as to what shall be done at the Governors' Conference later. With best regards, I remain, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 20th, 1917. WW2 71917 My dear Governor: I had a talk with Governor Aiken yesterday in regard to your return and views as to our action in the interim. suggested to him that he have a talk with Governor Harding stating how much improved you were and your intention to return about June 1st and your thought was that matters should remain in statu quo until you could come here and go over matters in detail. Aiken told me he had such a talk with Governor Hard- ing and Harding telephoned Warburg this morning in illy presence to that effect. In this connection, I want to say that the gen- eral impression among your friends here is that it would be unwise for you to go abroad directly on your return; that it would be much wiser for you to return as soon as your doctor deems it advisable, say, the latter part of May and after a short stay here and possibly a visit to Washington, go to the Adirondacks and arrange for your stay there for a period at least, using that as your temporary headquarters, coming to New York for a portion of each week or occasionally for a few days until you become more acclimated. In other words, spend a portion of your time right along in the Adirondacks for a month or two at least. If you could return wisely and safely the latter part of May, we could go over matters here and if then you thought it -EDERAL RESERVE BANK OF NEW YORK -2- Mt. Strong. To 3/20/17. advisable to secure a Deputy Governor, I can in the meantime be looking up some man or leave it entirely in abeyance until you come, as you may think best. As to the suggestion about Mr. Jay, it was first proffered as a suggestion for consideration by Mr. Peabody in case the other matter did not work out satisfactorily. I have not felt at liberty to discuss the matter with Mr. Jay, but will do so if you think it best. I hope to have a talk with Mr. Woodward as soon as mat- ters ease off a little so that we can secure a few minutes time. I am sure that Governor Aiken's talk with Governor Harding and Warburgas well as what they have absorbed here will tend to improve the feeling as to the situation here. Do not let down at all in your observations of the good doctor's instructions, build yourself up all you can and return to us only when it seems safe and advisable for you to do so. There will, however, be a number of people mighty glad to see you. With kind regards, I remain, Sincerely yours, Ale1174Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK March 21At, 1917. My dear Governor: I beg to acknowledge r ceipt of your letter enclosing one from Mr. iontague Norman. We also received a letter fro#4 Lord Cunliffe, copy of which will probably be sl,nt you today. After hr. Aiken, I turned them these letters were read b t over to Mr. Curtis for dc/ailed consideration and after we have had a conflrence on them, will advise you. ' Sine rely yours, 7>"t44-441144L---Th Deputy Governor. ' Benjamin Strong, Es., 4100 Yontview Boulevard, Denver, Colorado. RHT/VC FEDERAL RESERVE BANK OF NEW YORK March 21st, 1917. Ar. MAR2 7 191i My dear Governor: In furthar explanation of the minutes of the Executive Committee as enclosed herewith, would state that I have received from Mr. Warburg a copy of his letter to you which we will take into consideration in framing up our final letter to the Banco de la Nacion Argentina. We thought it advisable to sell our 3 % United States notes due January 1, 1918 on a 2 k % basis and hope that you ap- prove. Regarding acceptances, we have been holding at 3 - 3i but 3 1/8 has been about our minimum rate for me-Jiber acceptances. After discussion, we thought it advisable to not drop below 3 % at the present and at that rate, by giving Kenzel a little more leeway we can pick up a certain amount of good acceptances. Regardirg your own connection with the bank, the unanimous opinion seemed to be that there was no reason for any change in the relations existing, but all hoped that you would be able to return about June 1st. Regarding our discount rates, Governor Harding stated yesterday that the Board felt that a stretch of two points from 2 % to 4 % was somewhat larger than was advisable to maintain AL RESERVE BANK OF NEW YORK To -2- Mr. Strong. 3/21/17. now and that ultimately they hope to have the difference between the maximum and minimum rates probably hot over 1 % in normal times. He then asked if we felt that a difference of 1k % would be satisfactory between maximum and minimum rates at present and we approved. We will proceed to put into operation the authority given for rental of additional space so as to enlarge our dis- count and note tellers' spaces and thus provide for an increased amount of business along these lines. The Liberty riational came in to-day and instructed us to settle their clearing house balances and this makes two banks now, the Corn Exchange and the Liberty, and we hope it will ultimately lead to all the banks doing it. We are still investigating the matter of a credit man but have not reached a conclusion. With kind regards, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Enc. FEDERAL RESERVE BANK OF NEW YORK rch 22nd, 1917. My dear Governor: Bank of En,rland. We have your letter from Mr. Montague Norman, have read same and I return it to you herewith as you requested. I have discussed the matter with Mr. Curtis and we have no suggestions to make concerning this. We forwarded you yesterday copy of Lord Cunliffe's letter and proposed changes and this morning received your telegram that you also had received same. We will give this our consideration to-day and whatever comments we have to make will probably be forwarded tomorrow. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM En c. I. p, EQUIT'NNI:VVEYC7R7DING ;ay dttrA/ Lt-Z-.4 YO-tAA- y6t-4(4- fetL - ilt 0-1-4-1 car g:ILA,c11 y . iLreLAYALA-- ./c,e4, 2 2 _/ y C2A44A A44 /4t, a9ecy ea/4;3-w etwLet °Lei/---/wi fr fr /eV- - Xs/. 1/ trof CaL4A41- /1-04-L yae,y /-64 21-krAic tvv--4A-61 44 t4Ze7F al Cid 04-"1_ 1A141 utt-frf --A_Ji-tett t L4 frirs/ A._ UtA-4 yckA Art4t, Aczt.ctit-occ_ Wait- g7e tief Zio CY 'ktlit /4_Y-e /WA 741C7 #4St 44-14- /1vLe&- 5 CC ye.44 57-et& fr,49 74C 1,4 aLhott27 14/e4141, ntJt./ )111 alArftAtif '-%% 2,0--() itA.t- 74 74/ 2vat ez, Iscyte-ei- "reitz- v(1 ,c-ct4e ,(4 c.Xe. 2(4,1/4-o 741-e- - LL-iti4- t-ct - -44;4<- Cif Mu caecv ti-144ty. ahA.1 1,-et-41',(4"- Gt144.4.. = k 4 , ---)--H-A-e-ei6. tu, riaior4 AZ,V,Ato-e-4/4- diC;t44,1 y e-/ /1-21-0Let- ec.,6-0.17aLed 2-7 >-* EQUITABLE BUILDING .:"'t 4,9 CI 4- a N EW YORK tAAA' 70-tvif e--7 4--- ,--ds 44-,1 t, yo-,9_,e0t-iz "IAA- c/AlAVA-e 1A-A-iA-- ./fir pt-t4. U.Ay S. je A6,-/r---ika-w ccA}L-el . .1-Lir --11,0"44- ditvt4;Ya 1-43 ,fr-I.A/titly Slay 4, it-c, eai ti -c rAy - Ytirt4-4- (9 74-z-4-k-e4 45,0 a_ i _1o4A-f 9 cel-t- a- 611-zsti ?4 , 0.4,0-14, L-tAfftr zuft_ALd (cc 3 &_2:f__E. yee,o-el t), .y,_ ccA.,it 6.44. yo--4A) (-1-a ALAA4C--- i_A,t yei-ci-7.---- 71-44 Wzry 5kptiL1 ,9 ep- - 31-s---- -4" 6 e43L4-- a, 49- zkAa- .57U-Girt xuzi_do YO-4-t, ii'-ac-LA-i -r-c/cc, , til z,-1AA, ./frzt. c&z.Let _et", 1--ry 211146 / i-L,e-. ----- le--11LIACW 2_t_ty S aUtadt- 7v-el 5--71-A-il iilcid- 7-.,1-i lai 7.4Ax._ - mdci--h. A-ezi >i_,A, -6 la-I-Ay )1/641,176,a_ 4 kAL41 y44_ yo!4_ d.. 4ic-tei cc- yt,44- Ateur Afif tw-t.a FEDERAL RESERVE BANK OF NEW YORK March 23rd, 1917. My dear Governor: Answering your two letters of March ,194,/h. We are advised this morning that the t10,877, 500 of government bonds allotted to the FederaYreserve banks for purchase April let, our proportion will e <1,2,479,700. We have been selling some of our 3 % one year notes on a We agree with % basis. , that the bonds should be sold to the extent that the markv4 will take them, and also to sell the one year notes if rat s are favorable. We purchased abo der the additional leeway f:700,000 of bills yesterday un- ven to Mr. Kenzel as to rates of non-member banks and priv te bankers' acceptances. propose for a few days We do not o cut the rate below 3 % but hope to ount of bills from day to day now to pick up a reasonable replace those runnini off. We are rered to purchase warrants from our memher banks as we d from the First National, assuming that they need to sell the to strengthen themselves. Wit/ kindest regards, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Ifiontview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK Mfr MAR3 1 1917 March 27th, 1917. My dear Governor: Your letter of March 22nd enclosing comments on article in the January number of the Journal of the American Bankers Association came this morning. I am sending you herewith copy of the article as it ap- peared in the Journal and have just had an interview with Welton, who is the Editor of the Bankers journal. LI'. A. D. I know him quite well and he had stated to me confidentially that this was written by an English banker whose name he could not use, but who furnished him with this material and he reproduced it. I spoke of some of it being incorrect and asked if he would care to have some points brought out correcting same and if it could be done without any signature in order that he might be informed and use this for publication should he desire to do so. He said he would be very glad to and wish it could he furnished him promptly as they are just now getting material ready for the April number. I leave the matter in your hands to prepare such an article unsigned, as you suggest, and will be glad to carry out any instructions connected therewith, Sincerely yours, Deputy Governor. BenjaminStrong, Esq., 4100 Montview Boulevard, Denver ,Colorado. http://fraser.stlouisfed.org/ RHT/VCM Federal Reserve Bank of St. Louis ;y' 4 a /t rs5 /-- i 7 t i.,t/ / tit. f fr/(,._, ty ayi a ( A ,,., 1E ,,,, ,- 1 iit di' t iye- LA, i, -i 44.1e.411,. //,1 -.-, 1, 1 i totte -,1,-0-01,. 4 et fru ee ed 4.,c Vc, , r, i A' A', , FEDERAL RESERVE BANK OF NEW YORK MAR3 1 1917 March 27th, 1917. My dear Governor: I enclose copy of letter I received from a friend of mine in New Orleans in answer to some inquiry I made about R. S. Hecht, who wrs formerly with the First National of Chicago. I have been investigating hit somewhat on the theory that he might make a good addition to our force in New York possibly, or at least be wcirthy of considering, and pass this information on to you for youto pursue the matter further if you so desire or drop it as you may deem best. I spent Sunday and Monday in Ithaca, having a very busy time with no cessation up to train time lest night. Sorry to have missed Mr. Warburg who was here yesterday and went over with Curtis and Jay the matter of some of the amendments, also, the letter to the Banco de la Nacion Argentina Matters are very quiet here with a deep undercurrent of suspense, awaiting action of Congress. Bills are scarce and we are not buying many, but hope that after the 1st of April we shall be able to secure some. The Governors Conference will be held in Washington April 4th and if there are any matters which you feel should be taken up at that time, will be glad to have suggestions from you. With kind regards, Sincerely yours, Benjamin Strong, Esq., 4100 Yontview Boulevard, Denver, Colorado. C 0 P Y New Orleano, March 22, 1917. My dear Rob: I have your confiddntial inquiry regarding Mr. R. S. Hecht now connected with the Hibernia Bank & Trust Company. I know him. personally pretty well, having had some bond deals with him for my sisters' accounts. He is a strictly business fellow - good address - and gives the impression of solidity and good balance at once. He is of average height and weighs about 165 pounds. He is very thorough in what he does, and is a very conscientious worker. The attorney of the Hibernia Bank, (Mr. Bernard McCloskey) several months ago told me Hecht was far and away the strongest man in the Hibernia Bank, and he considered him the most thorough banker and student of banking in the city. Mr. A. C. Wuerpel, the cashier of the Metropolitan Bank, (my father's bank connection) told me he knew Hecht very well and that he considered him an extremely able banker. He was born in Germany, but is now a citizen of the He is 32 years of age, married, and has one United States. His wife is a member of my Church - Trinity Episcopal. child. His standing in the community is well illustrated by the fact that the Board of Liquidation of the City Debt selected him to arrange its recent bond issue of t9,000,000. His present salary is in the neighborhood of t6,000. A very prominent young lawyer here (Percy S. Benedict) who is very well acquainted with him socially and in a business way, told me he considered Hecht a man of unusual mental attainments and far superior to either J. H. Fulton or Sol Wexler, re(J. H. Fulton is cent New York importations from New Orleans. Vice President of the National City Bank and Sol Wexler is with Both are strong men). Bache & Co. My personal opinion is that he isbeing groomed for the future presidency of the Hibernia Bank, md that he likes his position and prospects here very much. Any further information wanted, I shall try to supply. The matter will, of course, be considered strictly confidential. With kind regards and best wishes, I am, Very sincerely yours, (Signed) Edw. E. Sou14. P 1 4f-1 Mace Correspondence I FE4RAL RESERVE RA (IP NIFAir/ VflPlt g Date To /3 dt-Pte--C-e-17--&-..-- Subject From eLt/17-0.4--tA/13- te-e-CA4/4 474E-X .10 7,fit .4/ 1 f Or2-kr-o v-o _ ited,:d 3o,oitte-r 14004.44 7- A* ye Ad7677-31.11. 4.44.4) (DV 4-.1-70 I I" if ID t 7/ 1 FEDERAL RESERVE BANK OF NEW YORK March 29th, 1917. My dear Governor: APR2 1917 You wrote me about the let of February suggesting that it was desirable to address a letter to Dr. Visserirg of the Bank of the Netherlands. I brought this matter before the Board February 8th and the Directors decided to hold the matter in abeyance. Now that Holland has decided not to allow any American vessels to land at their ports if armed, I am writing to ask whether you see any reason now for our taking up this matter with the Bank of the Netherlands or shall we allow it to remain asleep for a while yet. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCV FEDERAL RESERVE BANK OF NEW YORK March 29th, 1917. My dear Governor: hiLft. After invelifii2ti491 number of men suggested to us for the position of credit manager, we have decided to offer the position to G. E. Chapin who has been with the Westinghouse Electric for 20 years. He has been highly recommended to us by a number of credit men and officers of the Commerce, First National, Chase and others. J. H. Tregoe of the National Association of Credit Men stated to me that he should think we could consider ourselves most fortunate if we could secure him. He is of good address, about 33 to 35 years of age, has been receiving3,000 a yer salary but will probably come to us for about $3600 to $4000. The Directors authorized his employment yester- day after I reported details concerning him. SinCerely yours, )2Y0 Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCT' FEDERAL RESERVE BANK OF NEW YORK ad.P. APR2 March 29th, 1917. 1917 My dear Governor: Our Directors met yesterday and all were present save Mr. Thompson, wi-,o was in Arizona. After routine business and the continuation of the same rates of discount, at least for the present, we discussed a telegram from the Reserve Board in re flotation by the Secretary of the Treasury of $50,000,000 of certificates of indebtedness, 90 days at 2 7/0, and we had a long discussion as to the amount we should take and finally it was thought well to offer to take any amount up to , 5,000,000 which might be necessary to make the loan a success, as the rate of 2 which was fixed by the Secretary was too low to attract investment in them by member banks. We offered them to five or six of the large banks here yesterday and they all felt that if it was a question of patriotism they would take them, but were apparently agreed that the rate was too low, so they did not take any of them. We had indicated to Governor Harding when he vir's here that we felt 21 % was about the right rate and hadlheyput them out at that rate they would have been absorbed quickly. He probably fslt, however, that this w7s a small issue and he would prefer not to disturb the market against a larger flotation later on. I felt strongly and so stated that I thought it was an unfortunate precedent to establish to expect the reserve banks to take as investments government 7. ,ERAL RESERVE BANK OF NEW YORK 2 Mr. Strong. 3/29/17. loans at rates to be determined by the Secretary and after exchange of views this opinion prevailed and a committee of Messrs. Locke, Peabody and Curtis was appointed to draft a suitable resolution, expressing the views of our Board in regard to this not being taken as a precedent. We expect to forward this to the Secretary of the Treasury and the Reserve Board. The Board decided to sell our conversion 3 7. bonds of which we will probably get $3,000,000 or so, possibly more, after April 1st. We expect to take in J. P. $10,000,000 of gold today from Messrs. organ & Company, we now having about $17,000,000 besides. Lord Cunliffe cabled yesterday and Curtis told me he would forward the telegram to you so that our final proposals can be -sent over to them as speedily as possible. The Board approved of the rental of the addition space back of the teller's cages so as to provide more space for the tellers and discount department. Mr. Vanderlip has invited the officers and directors of this bank for a dinner to be held next week at a date mutually convenient. Mr. Peabody reported for the Committee composed of himself and Mr. Woodward that in View of your expected return about June 1st that no change be made in the organization until your return. The session lasted nearly three hours but not much time was wasted as we had considerable business to attend to. With kind regards, I am, Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. Sincerely yours, Deputy Governor. 144.- sa-k FEDERAL RESERVE BANK OF NEW YORK / /March 30th, 1917. / My dear Governor: Your letter of March 26th'received this morning. I note your view of the the United States one yenr notes justified in making the profit offered in view of the fact t' uestion of holding or selling It seemed to us that we were the one year notes at the price t we are soon to have another large lot. I received your st tement of expense in connection with your secretary and same wi 1 have proper attention. Mr. Jay went over to Washington night before last and is expected back this morni I had a very p easant cell from Mr. L. Ward Bannister yesterday who told me hb had seen you a week or 'ten days ago and he reported that you wire apparently in fine condition. also anticipating wit pleasure seeing We arc Delano after his re- turn froth the West. We are now raking plans for a Governors Conference on Wednesday next at Wishington and I assume that the Federal reserve exchange matter wi ReserveBoard. I 11 be finally put in shape and presented to the hink Mr. Jay and Mr. Woodward do not feel quite satisfied that the; drafts were not made"Payable'' instead of _...../....7,ESERVE BANK OF NEW YORK ....... ...2 Mr. Strong. 3/30/17. "Receivable", but having heard both sides of the argument and with a knowledge of what is expected to be done to protect the situation, I personally, see no objection to trying it out, making them receivable and saving the necessity of having the signatures of all the member banks and by making them receivable protect themselves against forgery. With kind regards, I remain, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK ta4.irt. APR2 1917 March 30th, 1917. My dear Governor: Some representatives of the small New York State banks met in Rochester day before yesterday to discuss our proposed action in re collec-tion of checks on all banks in our district, and I enclose herewith copy of resolutions which they passed at that meeting. This committee was in Albany yesterday confer- ring with the Superintendent of Banks and Hendricks talked over the 'phone with Mr. Persons, the Chairman, in answer to a telegram Persons sent us requesting us to suspend putting this matter into operation. Hendricks invited the committee to come down to New Iork and talk the matter over with us, as we would be very glad to give them our viewpoint and have theirs, to do some good by the conference, but as yet we have not whether they will come or not. hoping heard In any event, we have proceed- ed very slowly in this matter, we have the approval of the Reserve Board in our action and I believe we are fully justified now in proceeding to handle these matters. Kenzel tells me that some of the Western and Southern 14.s banks are 7)1anning to offer more of theirlbonds now, apparently believing that they had better sell them and go more liquid. FEDERAL RESERVE BANK OF NEW YORK 2 Mr. Strong. 3/30/17. We are to take t20,000,000 of the certificates of indebtedness issued by the Secretary, as finally allotted. They request us to pay the Subtreasury tomorrow, Saturday morning, taking their receipt for same and await certificates which will be sent from Washington as soon as finished. They will use our money to pay for the Danish purchase in the West Indies. These certificates will be registered, written "with interest at 2 per cent." and in denominations of t250,000. Mr. Jay has just telephoned me that the Secretary of the Treasury did not come forward as he had hoped in regard to waiving Assay Office charges, but I have not yet had the details and will ask Mr. Jay to write you more fully when he comes in. With kind regards, I am, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK 044, PERSONAk. APR6 April 2nd, 1917. 1917 Dear Mr. Strong: I have your favor of 'Zarch 27th this morning and also your "Personal" letter. Answering the latter, would state that "the suggestion as to Mr. Jay" to which you refer is now in cold storage, and as I understand, unless something unusual develops there will be no change in the situation until you return about June 1st. As to Y,r. Palmer, I shall have -leisure in conveying to him your message and say to you that he expressed to me very great pleasure in having met you in Chicago. I appreciate very much your kind words in regard to the' conduct of the bank here. With it all, however, I am not unmin- ful of my own limitations and lack of experience which had they been different might have been conducive of a more satisfactory administration, at least, to you. Please do not feel however, that there is any debit or credit between us. On the other 11,-,rd, I have the desire to contribute in every way to your speedy recovery and quick return. We are entering upon the most eventful week in the history of the country and await each day's opening with the feeling that no one can tell what the day may bring forth. My best regards. Sincerely yours, Benjamin Strong, Esq., 4100 Montview Boulevard, http://fraser.stlouisfed.org/ Denver, Colorado. Federal Reserve Bank of St. Louis APPROXIMATE AMOUNTS OF ACCEPTANCES BASED UPON CREDITS WITH RENEWAL PRIVILEGE HELD BY EACH FEDERAL RESERVE BANK AS PER SCEEDULE1 ON FILE WITH THE FEDERAL RESERVE BOARD March 31, 1917 (In thousands of dollars) Ammints last held Mar. 30 Bought 1917 Boston Date of Amount s hell Matured schedule recqived March 31 1917 300 300 Mar. 28, 1917 Nev York 7,910 7,910 Mar, 29, 1917 Philadelphia 2,142 2,273 Mar. 30, 1917 eleveland 2,475 2,475 Mar. 26, 1917 Richmond 900 900 Mar. 30, 1917 Atlanta 25 25 Mar. 28, 1917 Chicago 2,788 2,788 Mar. 27, 1917 St. Louis 1,942 1,942 Mar. Mg, 1917 Minneapolis 354 354 Mar. 28, 1917 Kansas City 586 586 Mar. 23, 1917 Dallas 220 220 Mar. 23, 1917 San Francisco 912 912 Mar. TOTAL 20,554 131 ' 131 DIVISION OF REPORTS AND STATISTICS, FEDERAL RESERVE BOARD, MARCH 31, 1917. 20,685 ....._321v FEDERAL RESERVE Ice- Correspondence BANK OF NEW YORK - Date_q3r1.1_2.,_ )l7. Subject _ regard to Federal reserve banks and lovernment rom ;he 2ederal re ,rve-banks arc filoal agents of the Government, and it seems appropriate to consider how they might serve in the dintribution to investors of new issuel. ns doubtless the ,physical distributionrof bonds to subscribers =hen issued can be more lalokly and economically accomplished from the 2reasury De- partment direct rather than through banks, it seam that the assistance of iederal reserve banks would better he reserved to (1) aecciving sabscriptionS: Directly;. Throurt moMber and nonmember banks and bankers; (L) Distributing uniform'llterature by the twelve re.. reserve banks to banks anil bankers in their re- spective districts. (3) Conferring with the ;averment regarding pros- pective issues. OILL.0=: As probably all subscriptions le:ist be collected and tabulated in the salary Department as a basis for allotment and 'isvue of bonds, subscription forms and forms for tabulation should be devised to avoid unnecessary duplication of work, and methods of work arranged. ..luiLLL211.L21;2: 1he subsorirtion forms shanld be in quantity at each Federal reserve bunk for distribution over counter to the nublio. They should also be available at the office of every member and non- her bafik and banker in each district. 'ale question of having them also at post offices in placeo where mare no banks should be considered. In any event, the subscriber should be supplied with return envelope-. 37 1101W 3ffice Correspondence 110 FEDERAL RESERVE BANK OF NEW YORK Date epril 2, 1917. Subject:augeestIons for consideration reeard to eSderal reserve banks and Government issue. Kenzel, nmm for forwarding subscription to the Federal reserve bank of the district. "ultable literature for distribution should accompany the subscription forms when forwarded to the local banks, bankers and post offices. This should contain specific Instructions to the public as to preparing and forwarding their labscriptions to eederel reserve banks, and full information regarding the issue, and whatever of a general nature is deeirable. eeparate letters or circulars to local banks might be prepared urging their cooperation in securing sebecriptions from their deeesitors, and suggesting their financing their depositors' purchases with the assistance of federal reserve banks through rediscounts and loann is required. TIOM: The denominations f a new Josue should have careful consideration. le it would seem that el00 wore a small enough bond, I an told by dealers hat the en and ..;50 piecee are popular and that many small investments are e in bonds of those*nominatione. would, therefore, surest that the Oupon bouds.be Issued in denominations of "e'2,3, etiO, el001, U00 and e1,000 each d that the registered forms include all Or eest of those denominations, and also issued in denomieations of ,5,000, ,A0,000 and ;50,0400 each. As the plan o the offering, i.e., whether at par or at a price to bid, and also whether or not a deposit would be required with each subecripe on would determine to a degree the machinery needed, these points should be refully considered. It is generally thought that an offering at par, being a definite °position, brings a larger response, as a laree part of the eenerel public Asap FEDERAL RESERVE BANK OF NEW YORK tfice Correspondence Co. , 1917, Date_ , Subject: __14,43130.6a4.0414_ reeard to Federal r:. r OM banks and noveruneat tune q leek the ability to settle on If that form of aw price. offering is made, possibly no deposit.is desirable on subscriptions of .500 or less, but, if bids are desired, then a deposit should accompany each bid, as the bids would soriptions at par; be feuer and ia larger amounta than eab- and it Is desirable not to have irresponsible bidders. ie interest rate and maturity of issue might determine which form offeril would be preferable. :eould If'a low rate bond were offered in moderato attract one class another if of 'singer maturity. ae investors, if of short maturity, and If a. short lond, bids might be asked, but if a long bond at 10* rate, offerings at par would probably meet with better respoase. If a large issue, one Of an indeterminate meturity and at a higher rate might yield better results as even the possibility of early retirement helps an issue, and a refunding feature is not unattractive. For instance, an issue of 3-30 year bonds, that is, redeemable at or after three gears but payuble In thirty years, if issued at 15 lA would undoubtedly aell well and at e amount offered. low rate. substantial premium for almost any reasonable After three years, -3 Or would probably be either a high or If high, the Government could then retire, the issue by refunding at lower .rate. If lee, the Government would have made a good bargain. luoh an issue selling at a premium would probably affect conversion 5s less unfavorably than a large issue of 3ø Of either' long or short maturity, In any event, careful oonsideration should be given to the effect of new issUe or issues on the money market, and precautions too great a loak-up of funds be made at any one time. taken that not Government deposits in Federal reserve banks are a lockup, es witness the disturbance last July """magi"iirl* Dffice Correspondence FEDERAL RESERVE BANK OF NEW YORK Date Subject: ,7umestiorts for C13idOrL.tim.1 in 0. i.rom April 2, 1017. regard to Federal reserve banks and B. Kenzel. .lovernnent issues. Incident to the deposit of incorle tax receipts in Fnderal reserve banks.. A similar stringency following a Government Issue would be unfortunate and night affect the success of subsequent Issues. Payment of subscriptions in instalments, or providing for aubscrib- ars taking up their allotments 'at intervals, and/or deposits by. the Government of part of the proceeds in national banks, might be considered in this regard. -'1.F1T0RIJ4L: The 3r: bond iinue of 1398 (panish 7:ar loan) was for ;200,000,000; the offering was for public subscription at par; circulars of information with blank forms for subscription were supplied to more than 22,000 money order post offices, to every express company, and to. all the banks. A period of thirty-ono days was allowed for the receipt of subscriptions; 320,226 subscriptions amOunting to more than 41,500-000 wore received. these 11,403 were for amounts of Tess and 20,376 for more than ,4,500 each. Of than ,100, 100,573 were for ,500 eaoh, It should be borne in mind that these bonds carried the circulation privilege and showed a prospective profit to purchasing banks from the moment the issue was announced. The J0,000,000 issue of 50-year 3' Panama Canal Bonds sold In June, 1911, did.not carry the circulation privilege. They were offered for public subscription by bid, eadb bid to be accompanied by certified cheek for of the par value of the bonds desired. I have been unable to find he *Ember of bids submitted, but they aggregated ,212,111085,200,. and the average Aprice realized was 102.5325, thereby producing a premium of ,1,291,274.19, and lade the actual interest rate transaction 2.9019. It Is interesting to note that these bonds which are now within forty-four year of maturity, are Ace Correspondence --'rom FEDERAL RESERVE BANK OF NEW YORK Date_Lprfl 2. 1917 Subject regard Ls othra1 re::erve banks r.tryl Anye.-ntnent tomes. Aan R. Kenzel. 5at present no:TALI:111y (Noted. par bid. (COPY) THE FIDELITY TRUST COMPANY Buffalo April 6, 1917. Dear Treman: I shall not be able to attend next Wednesday. Rand has offered to raise a regiment of 1,000 at his own expense and go with it wherever ordered. cannot bear to think of it, I A Prussian would shoot at him as soon as at anybody else. It brings the war close home and I am hardly able to work in thinking of possible eventualities. Sincerely yours, (Signed) Franklin D. Locke. FEDERAL RESERVE BANK OF NEW YORK April 7th, 1917. h41.k My dear Governor: APR1 0 1917 I regret not having been able to write You fror Washington but from the time we arrived there Tuesday night until we left at 7 o'clock last night, we had a strenuous time, working Wednesday night until 11 P. M. and Aiken, Rhoads and myself working the next night until 11:30 so that they felt, it reminded them of the first meeting when you were the "stern dictator" and drove them to do their full duty, with a little added. Mrs. Curtis having gone down to Washington, Curtis decided to remain over Sunday and will be back Monday morning. I assume Mr. Jay has kept you in touch with what has been going on during the week here. You can imagine that Washing- ton was a most interesting place during the present week and the f,/ climax was reached yesterday, Good Friday, when the President signed the bill finally placing the United States on the side of the Allies. I will give you a hasty account of what took place and Curtis will give you the full report a little later. I had a short talk with Mr. Delqno who gave me a glimpse of what you had in your mind, he reported you as looking in splendid health and I am glad that he visited you. CRveyaNk OF NEW YORK 2 To Mr. Strong. 4/7/17. Easter will undoubtedly be a day of serious thought and meditation, but as Delano expressed it yesterday, God seems to be directing all events towards making real democracies out of the principal nations of the world. My regards to you. Sincerely yours, Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM WILL APPOINT G. I. SKINNER. Deputy to be Made Head of Banking Department. The Now fok Timm pril 6.A large delegation of bankers from many parts of the State A LBA called upon Governor Whitman this afternoon to urge him to appoint George 1. ; Skinner of Chenango County to succeed Eugene Lamb Richards as State Superintendent or Banks, when the letters term expires On July 1. The Governor told the delegation that he had decided to make the appointment and that Mr. Skinner's nomination would be sent to the Senate on Wednesday. At present Mr. Skinner is Deputy Superintendent of Banks. He has been in the 1,.partment for nearly twenty years. FEDERAL RESERVE BANK OF NEW YORK April 7th, 1917. My dear Governor: Our new credit man expects to take up his work about the 15th of April and we heat very good reports concerning him. As to a foreign exchange man, 7:.r. Kent has been away but writes under date of April 6th that he will be glad to help us in any way he can. He says: "It so happens I have similar requests on my hands for four other banks", so I assume that we may have difficulty in securing the right kind of man at once, although we have a number of names now which we are investigating. I have been advised that Mr. Arnold of the First National of Chicao is a good man and am writing McDougal about him to-day. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM MEMORANDUM IN REFERENCE TO CONFERENCE OF GOVERNORS WASHINGTON, April 4, 5 and 6. St. Louis was not represented and Governor Miller who had reached Washington Monday night was called home by a telegram so that he and Mrs. Miller left Monday night. Curtis received a telegram later stating that he could have remained had he understood the basis for the telegram. The Conference elected Aiken, chairman, and after a short preliminary exchange of views we went to the rooms of the Reserve Board where Mr. McAdoo presided. He addressed the Gov- ernors, stating that he wished to make explanation as to the $20,000,000 short loan to the government; that returning home to Washington, he found that the debt for payment of purchase price of the Virgin Islands to Denmark of $.:5,000,000 had been changed to March 31st instead of April 17th; that he did not wish to issue bonds as if war was declared we would be called upon to finance the Allies and might have to raise from three to four billions of revenue, both through very much higher taxes and bond issues; that inasmuch as the resources of the reserve banks were ample,that.the loan he desired by the government was a short time loan of 90 days he thought it a very proper act for him to offer the loan to the reserve banks; that he had placed government deposits without interest in the reserve banks and felt that if they paid 2 % on the loan it was a fair rate under the circumstances. He stated that they would nrobably have to issue another loan, probably of $50,000,000 before the 1st of July; that we were working now in strenuous times; that he has always tried to be reasonable in his requests but that -2- often tnere was not time for consultation, etc, etc. He stated that in view of these facts he waG disappointed to receive a set of resolutions from the New York Bank evidencing some criticism; that so far as he was concerned he felt that there was no obligagation on his part to consult the banks in these matters and he wanted it understood that he did not request the banks to take the loan but had made an offer to them and wanted them to feel free to accept it or not. I thought I would reply to this defending the bank but Aiken, whom I was sitting next to, advised me not to, although I did do so in part the next day, but unfortunately after the Secretary had left the meeting, 'leaving the members of the Reserve Board there. Rhoads stated also to the meeting afterward that the way the telegram was framed, it was more than a tender or offerit was an implied obligation. Curtis read the resolutions of our bank to the Governors later and they seemed to meet with very general support and approval. An a sequel, Governor Harding told me confidentially that the Secretary told him the next morning that he had a c:ld and bad throat thai morning and,he feared that he did not express his views nor outline his position very well. He hoped that I, as represen- tative of the New York bank had no feeling over what he had said and he was extremely nice to me during the days while we were there. He is evidently working under very great pressure and we had another meeting with him yesterday afternoon at his office at which he was very cordial, sad my own views are that the resolutions made an im- pression on him;that he felt called upon to defend himself, in doing which he justified his position but evidently did not wish to convey the impression that he was sore. I think now that the situation is in good shape and we had better drop it, although I wish to report to the Board in a general way as to his statements. The Secretary stated that he would probably issue another offering of 50,000,000 before the rirs-t. of June and de- sired Governor Harding to ascertain whether the banks wanted to handle this as fiscal agents, feeling free to do so or not. There seemed to be a unanimous expression that it was wise for the banks to handle them but that the rate should be made sufficciently attractive to permit the reserve banks to place them with outside investors a s they would be attractive, being issued from 30 to 50 days only in anticipation of taxes. Later Governor Hard- ing told me confidentially that the Secretary had informed him that he would place them through the reserve banks but had not decided whether the rate would be 2, 2-;Lor 21-- per cent. Personally, in view of his explanation andhaving placed ourselves on record against precedents, I should be inclined to feel that we should subscribe liberally if the rate should be attractive and if any should he left on our hands and nOt be placed outside, we could carry them for the short period for which they would be issued. Just here, let me state that I read your suggestion to the Governors about accumultion of gold and they will govern themselves accordingly. (Mr. Treman wished me to state, that the above was dic- tated very hurriedly immediately on his return from Washington this morning. V. C. N.) FEDERAL RESERVE BANK OF NEW YORK April 7th, 1917. My dear Governor: I return herewith the letter of R. H. Malone. I wonder if he is correct in his statement that it was the president of an REIREE bank or does he mean unstate bank? Certainly, there is no basis for the statement that any bank in New York City cannot se'cure currency in plenty at the New York Reserve Bank at any time within a few hours' notice. Regarding the vault reserves, I assume that he refers to the amendment. Should you secure the name of the bankers, I will be glad to pursue the matter further. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Enc. FEDERAL RESERVE BANK OF NEW YORK kVA-% APRI. 0 April) 7th, 1917. 1917 My dear Governor: Regarding our collection system, Mr. Hendricks perhaps while I w,s away may have advised you that the state bank protec- tors have had introduced into the New York State Legislature a bill, No. 1589, amending the law as follows: " To pay in cash or by a draft upon a bank in the City of New,York in which such bank has deposits sufficient for the payment thereof, any check presented for collection by any express company or messenger. This Act shall take effect immediately." Hendricks tells me that he has advised the managers of the express companies to accept no draft on New York unless it is certified; cash, of course, we do receive and have agreed to pay the transportation charges. We are keeping in touch with the situation and hope that the bill will not pass. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK April; 7th, 1917. PR1 0 1917 My dear Governor: Regarding our collection system, Mr. Hendricks perhaps while I ws, away may have advised you that the state bank protec- tors have had introduced into the New York State Legislature a bill, No. 1589, amending the law as follows: " To pay in cash or by a draft upon a bank in the City of New York in which such bank has deposits sufficient for the payment thereof, any check presented for collection by any express company or messenger. This Act shall take effect immediately." Hendricks tells me that he has advised the managers of the express companies to accept no draft on New York unless it is certified; cash, of course, we do receive and have agreed to pay the transportation charges. We are keeping in touch with the situation and hope that the bill will not pass. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK April 10th, 1917. s APR1 6 1917 PERSONAL. My dear Governor: Your letter in regard to Mr. Arnold is at hand and our letters seem to have crossed as you had one from Mr. Mckay which I am returning herewith for your files. I have consulted with two or three parties this morning who know Mr. Arnold and find that he is a man of very good address, was trained as a minister, is a fluent speaker, is used by his bank as a promoter of good relations, attends upon conventions, travels a good deal and in this respect seems to be successful. Parties consulted, however, feel that he has not the real knowledge of the banking business sufficient for the position we have iht mind. I would feel, therefore, that it would be unwise to tax your strength by making a special trip to see him, but when you come East you could easily stop over there perhaps and in a quiet way make such inquiries as to him and others as to you seem desirable. If you wish me to pursue the matter further, kindly advise me. With kind regards, I remain, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. FEDERAL RESERVE BANK OF NEW YORK April 10th, 1917. My dear Governor: I have a letter just received from Mr. Warburg from which I quote as follows, as I know you will use the information which he gives me as confidential. It may be that he will write you himself concerning it. "I have just returned from Chicago, whereou will be glad to learn that my speech was very w,44/7 received, much better than I thought it would reaction, and I believe that two or be./4 got some real ree of the leading State banks and trust companies w)1.1 come in. As a mitt- , ter of fact, the Union Trust Company has definitely promised, and the Merchants' Lo / 0/ and Trust Company has prom- ised with a very small reaervation, which I believe will not prove serious. of Chicago is now ,W I)also believe that the State Bank the verge of coming in. This infor- mation, howevert'is only for you and Mr. Jay.The St. Louis Union Bank was admitted to-day:" Sincerely yours, Ce.W__Ace./1,t4 Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK Taff. April 10th, 1917. APR1 6 1917 My dear Governor: I have your favor in reference to the organization of the bank and your suggestion that we consider putting on additional employees. This matter has not been lost sight of and already we have had added some in one or two departments. In this connection, I asked Mr. Sailer a week or two ago to have a chart prepared which Mr. Jefferson has done making blueprints and detailed information applying to these will be in readiness to submit to-morrow and forward to you. Taking this as a basis, we anticipate formally dis- cussing it in detail at the Board meeting to-morrow, making such changes as seem advisable. I think we can properly add to the Discount Depart- ment some additional employees and train them, although we have a number in other departments prepared to draft into this department when necessary. As you know, we have employed Mr. Chapin as head of the Credit Department and he begins his work next week. Mr. Jay has promised to see Mr. Malburn to-day about having a meeting of state bank examiners at the Federal Reserve Bank in New York so as to be able to get into close touch with them. RAL RESERVE BANK OF NEW YORK -2- To Mr. Strong. 4/10/17. Regarding the foreign exchange man, we are still working on this and I have had a conversation with Mr. Kent this morning as a result of which he asks us to wait a few days as he is giving the matter a good deal of thought, it being his desire that we have a very good man. It will be difficult to secure a high grade man perhaps at once and it may be necessary to put in a younger man who is competent to open books and look after the details in a satisfactory manner, but might not have the experience to justify his being made head of that department. We are always glad to have suggestions from you on these points. We know that in these stirring times how greatly you desire to be back in the thick of the fight, but if the war goes on there will be ample time for you to come in after things are more fully developed. We hear a great deal about the issue of bonds in the mar- ket and business generally is awaiting the determination of this most important movement. On the other hand, we do not yet know whether the reserve banks are to be used in this connection, nor in what capacity, nor to what extent and we cannot do very much in the way of developing a department to handle our share of this until we know wh.A our share is to be. We are, however, investi- gating the matter of additional space and will be securing information as to additional help. If at any time you become uneasy over the matter do not hesitate to wire for information as we will keep you in touch with affairs whenever we feel the situation at all alarming. Sincerely yours, 0 Benjamin Strong, Esq., http://fraser.stlouisfed.org/ 4100 Montview Boulevard. Federal Reserve Bank of St. Louis Deputy Governor. FEDERAL RESERVE BANK OF NEW YORK April 11th, 1917. APR1 6 1917 My dear Governor: Answering yours of April 2nd regarding your suggestion to offer to the Secretary of the Treasury to take charge of the 'physical issue of the short time bills, etc., would state that the Governors last week all indicated to him their desire to have the reserve banks act as fiscal agents in whatever way seemed most desirable, further, that they deemed it most essential for the influence of the reserve banks that insofar as they could, all such transactions of the government pass through the Federal reserve banks. This was impressed upon the Secretary of the Treasury and upon the members of the Reserve Board. advise any further action being taken? Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM 0 Would you FEDERAL RESERVE BANK OF NEW YORK a 41. fre. APR1 ti 1917 April 12, 1917. Dear Governor Strong: I enclose herewith copy of a letter received from Governor McDougal this morning. At different times I have been going over the matter with Mr. Sailer, urging that he secure a foreign exchange man as soon as possible, and we have about concluded that it will be wise to find some young man who has had good training and whom we can employ at a salary of probably from 42,000 to 43,000. Then, after your return when we shall have had more knowledge of how much work will be necessary, we can secure a head for the department if you think that advisable. With kind regards, I remain Sincerely yours, Deputy Governor. Benj. Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. t4A-z/v t,U RHT/HAB Enc. l 1-44-* "f6"444414- I ma-- "9 C&isiit's FEDERAL RESERVE BANK OF NEW YORK April 12th, 1917. PERSONAL. Ny dear Strong: While these are busy times here at the bank we are all thinking of you, knowing how interested you are in developments from day to day and how strongly you are drawn towards New York. On the other hand, things while they are develop- ing rapidly have not yet crystallized and it may be that before the present quiet and suspense changes into activity, the days will pass so that your time for coming will have arrived. It is better for you to keep out of the maelstrom just as long as you can anddo everything possible to build up your surplus strength. Be assured that we will wire or telephone you in case anything unusual develops quickly. Do not think that we are letting matters run along in a haphazard way because we are trying to make preparations in every direction to meet the onslaught. I wish you could be here for one of our alarm drills which -we practice now every few days. We shall keep in touch with the bankers here more closely than ever now and feel confident that any advice we need will be willingly given and we shall have the fullest cooperation. FEDERAL RESERVE BANK OF NEW YORK 9 ..... To Er. Strong. 4/12/17. More than that there are signs developing on every side that some of the larger trust companies and state institutions will be coming in soon. My very best wishes to you as always. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Yontview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK APR1 1917 April 12, 1917. Dear Governor Strong: Last night Mr. Vanderlip entertained at the Metropolitan Club, as his guests for dinner, Mr. J. P. Morgan, the members of the Clearing House Committee, (Messrs. McGarrah, Prosser, Frew, Alexander and Townsend), the directors of our bank with the exception of Er. Locke, and Er. Curtis in addition, a total of sixteen. After dinner Er. Vanderlip stated that he had felt for some time that the clearing house and the Federal reserve bank are not so closely identified as they should be, and that matters had drifted along without anything arising to force closer relationship. He felt that the member banks should really take more interest in the Federal reserve bank than they had thus far evidenced, and Er. Jay suggested that we have an occasional meeting of the clearing house committee and our board. This seemed to meet with general approval and was the best result of the dinner, I thought. There was an exchange of views on the bond issue matter, and the general opinion seemed to be that if the Secretary of the Treasury should issue one billion dollars of bonds now and later should issue another billion as needed, it _CRAL RESERVE BANK OF NEW YORK Benj. Strong, Esq. 2 4/12/17. would be wiser than to attempt to issue two billions at present. Everything is held in suspense at the present time, awaiting developments as to the bond issue. Er. Jay has gone to Washington to-day to confer as to the amendments. He has been in consultation with a number of State bankers and also with trust company men during the past week, and knowing their views will confer with the Federal Reserve Board so that it can reach the house committee before the amendments are finally settled. Governor Aiken called me up and said that he is disturbed over the proposed two .billions of one-year certificates of indebtedness. He thinks there is danger in having this much additional to the five billions of bonds authorized, and says he thinks we could finance the Allies for the next two or three months by the issue of certificates of indebtedness maturing in July or August, to be refunded into the 3e, bonds, and that they would be taken up to five hundred millions by the banks, at once. I shall keep you posted from time to time. Don't worry, as we shall advise you quickly if anything unusual should develop. Sincerely yours, Deputy Governor. Benj. Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/HA.B FEDERAL RESERVE BANK OF NEW YORK April 12th, 1917. APR1 1917 My dear Governor: Our directors met yesterday; all present save Mr. Locke who wrote a very amusing letter, a copy of which I enclose. Rates of discount were reaffirmed; there was considerable discussion of the government bond issue, a statement of what was contemplated having appeared in the morning papers. I made a brief report of what took place at the Governors Conference; explained some of the amusing things which have developed from our collect- ing checks on state banks through the express company, as some of the banks are sending small silver and mutilated currency and in other ways trying to annoy us, but we are taking allthat comes with good grace, believing we will win out in the end. We decided to hold in abeyance the question of our treat- ment of employees who may enlist as some of the directors felt that it was quite a serious question and that no plan should be formulated committing us to hold positions open for so indefinite a time and obligating ourselves to pay salaries without knowing to what extent our men would enlist later, etc. We discussed the question of purchase of acceptances bearing German names, especially originating in South America. We are sending off to-day our final draft of the Bank of England matter. Adjourned to meet in two weeks unless called sooner. RESERVE BANK OF NEW YORK -2- To Mr. Strong. Mr. Curtis tells me he has written you 4/12/17. in longhand the essential matter connected with the Governors Conference in Washington, so I will not repeat, as you will receive the detailed report later. My best wishes to you. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Enc. 0 FEDERAL RESERVE BANK OF NEW YORK APRi 6 1917 April 12, 1917. Dear Governor Strong: I enclose herewith copy of a letter from Mr. James Brown in reference to inquiries made by him in our behalf. The letter explains itself. I also enclose copy of a letter received from Mr. Meredith, president of the Bank of Montreal, with whom Mr. Curtis and I lunched, as a guest of Mr. Jay, about two or three weeks ago. If you have any comments on this kindly advise. With kind regards, I remain Sincerely yours, Deputy Governor. Benj. Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/HAB Enos. (2) . FEDERAL RESERVE BANK OF NEW YORK , al tr. APR1 8 1917 'AP ,, April 13th, 1917. My dear Governor: Your letter of march 31s1 was received and taken to the Governors' Conference at Washington at which the paragraph in reference to the accumulation of gold bars by some of the other reserve banks in case they expected to paztici- pate in the foreign business, was read and absorbed I think. I have$not heard from Mr. Kent yet and will wait a day or two longer before taking up the question of a foreign exchange man with him, but meanwhile we are pursuing investigations along other lines. The financial district gives evidence of preparation for war emergency in that in connection with a number of buildings large window guards are being erected, our building as well as the Hanover and Liberty National being recent additions to this class. I had a long talk yesterday afternoon with Mr. W. W. Orr who with Mr. J. H. Tregoe are the managers of the National Credit Men's Association. Mr. Orr is working on a manual or primer for extensive distribution among business houses of all kinds and quite an extensive campaign has been entered upon to facilitate the consideration of the trade acceptance system more gen. erally. All this in preparation for the time when we will have ,ERAL RESERVE BANK OF NEW YORK Mr. Strong. . 4/13/17. a more contracted credit situation and will need to use every credit which can be availed of. I assume that you will advise as soon as you make any definite plans as to your return so I can govern my own personal plans accordingly. With kind regards, I remain, Sincerely yours, tA4-44k,a4,__ Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCY FEDERAL RESERVE BANK OF NEW YORK Lfr April 13th, 1917. APR 1 8 1917 My dear Governor: I have your two favors of April 10th. M. de Neuflize called on us to-day, he having just returned from Paris on Wednesday of this week, having sailed March 31st. He reports very great encouragement given to the French people by the entrance of the United States into the war; he seems to have a feeling of personal relief that it has happened and that now there will he fewer obstacles placed in the way of financial and other dealings with France. He did not seem to have any inside information as to the duration of the war except that the morale and spirit of the German prisoners seems to be much lower than that evidenced in prisoners who were taken during the first stages of the war. Curtis told me to-day that Mr. Delano informed him that Lord Cunliffe was expected to come over with the commission from England and should this prove to be true, I assume you would want to meet him either in Chicago or in the East. Mr. Jay and I had a long talk with Mr. Alexander today, discussing the bond situation. He and Mr. Woodward both feel, I think, that the money secured from subscriptions should in part be left on deposit with some of the state banks and trust _SERVE BANK OF NEW YORK ....... 7_2-7 To Mr. Strong. 4/13/17. companies either with security or on some basis which can be worked out. The other point of view of course is that the favors, if any,in connection with the bond issue should be diverted toward member banks as they have had rather a hard struggle in competition with the state banks and trust companies for the past few years. Mr. Jay stopped over at Philadelphia on his way back from Washington and came over on the train with Mr. Rue this morning. There is a meeting of the Executive Committee of the Advisory Council to-day and Mr. Morgan invited Mr. Jay to take lunch with them. I will ask him to write you fully to-morrow concerning his Washington trip and the luncheon. There seems to be quite a well-defined impression that on: a good many trust companies and state banks are seriously considering joining the Reserve System soon. I expect to go up to Ithaca to-night to remain until Monday night unless something unusual develops, this giving me three days at home and hope to secure a little rest from it as I have begun to feel somewhat the strain. I hope that you are gaining all the time and that you are able to get in some golf occasionally as that will give you diversion of mind as well as outdoor life. My best wishes to you as always. Sincerely yours, Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Deputy Governor. Misc-37 Office Correspondence To FEDERAL RESERVE BANK OF NEW YORK Bowe April 13, 1917, Subject : Mr. Strong's lt_t_er_oi April 9th- Mr. Treman From E. R. Kenzel. Our present holdings of bills drawn by or bearing indorsement of banks of German name or affiliation in South America are as follows: Banco Aleman Transatlantico, Valparaiso, appear as indorsers on 041,921 bills accepted by Muller, Schell & Co. and also indorsed by the Equitable Trust Co. The drawers, amounts and maturities are: 4 1,925 G, Ehlers Montval & Co. due June 15 due June 6 39,996 This Banco Aleman Transatlantico represents itself to be a native bank and not a German institution. Banco Germanic° de la America del Sud are drawers of 0200,000 dollar exchange finance bills accepted by the Equitable Trust Co. and due April 30th; and indorsers on 0166,865.08 comprising the following bills: Acceptor Nat.Bk of Commerce Irving Nat'l Bank Brawn Bros. & Co. Amount 072,466.40 10,929.56 30,580.32 tt 28,425.72 Guaranty Trust Co. 5,000.00 It It It 4,750.00 Nat'l City Bank 3,000.00 Equitable Trust Co. 3,539.03 Nat.Bk of Commerce 1,471.68 It It tl 3,770.59 It It H H 2,931.74 ttft Maker Maturity Apr. 23 " " " May 23 23 23 Horn & Co. II H It 8 t, 8 It 8 at 22 ft " It It It II Equitable Trust Co. Fritz Schwarzschild It It Vorwerk & Co. Nat.City Bk (Chile branch) Springer & Flugel Oskar Tutzer 3 3 3 It Other Indorser Pt Mr. Neilsen of Brown Bros. & Co. is checking up for me the affiliations of all of the South American banks that have ever appeared on our books. I under- stand that a number of the banks in South America were organized by combinations of nationalities, and that therefore the title of such banks may not be a clear indication as to the nationality of the interests concerned. For instance, one with Belgian, Italian and German interests might have either an Italian, German or French title. Brown Bros. & Co. have very complete files on this matter, and are checking up the identities of these institutions for us. lice Correspondence To Ak. Treman FEDERAL RESERVE BANK OF NEW YORK Date April_l_3_,,_1911. Subjed:Mr. Strong's letter of April_fth._ From E. R. Kenzel. They also have very complete files on the names blacklisted by England. This information they have received from the British Government and have been required to hold in the strictest confidence, but 15±. Neilsen tells me they will try to have it made available to us. I understand that at the outbreak of the war, in England there was legislation which prohibited British banks or merchants from paying their maturing bills if the name of an enemy alien appeared on the bill either as maker or indorser; that all of these bills were later taken over by the Bank of England where some are still carried; but that on practically all of them where it could be proved that cover had been received to provide payment and/or where such bills were owned by Britishers and where no enemy alien interest remained, under suitable guarantees payment was permitted. From what I have learned in these regards, the feeling among banks and bankers in New York is that nothing should be done by this Government to prevent the payment at maturity by American banks and bankers of their maturing obligations, and there is little, if any, fear that such bills will not be met at maturity. ERK/PE FEDERAL RESERVE BANK OF NEW YORK April 13th, 1917. My dear Governor: Mr. Jefferson has practically finished his chart of organization and told me to-day that he had worked out the detail in connection with each important office. I then suggested that he give a blue print chart with detailed plan to each of the officers and we are to meet one night during the coming week if nothing prevents to have a forum for the exchange of views, after which we will make definite decisions as to the points discueed. With kind regards, I remain, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/V0M Enc. FEDERAL RESERVE BANK OF NEW YORK APR1 81917 April 13th, 1917. My dearGovernor: Answering yours of April 9th in regard to bills of German origin or with German names would state that we have had this matter under consideration for a week pr so past and on Wednesday discussed the matter with the Board of Directors who, while not taking action, expressed on the part of one or two, at least, the thought that we ought not to take any bills of this character. I have discussed same with Mr. James Brown to- day as to whether we should adopt so radical a policy or rather adopt the policy of putting each bill offered with German names to the acid test as to credit, names and purpose for which the bills are drawn, etc., and he very much favored the latter one asbeing the only practical policy to work under. I asked Mr. Kenzel to prepare a statement as to our present holdings which I enclose herewith. I learn from Mr. Brown that Lord Cunliffe is probably on the way over here at the present time. I have arranged a meeting between Mr. Jay and Mr. Hard- man Lever to discuss the methods which the English used in floating their bonds and Mr. Brown will come with Mr. Lever to-morrow at 10:30 A. M. Benjamin Strong, Esq., 4100 Montview Boulevard, http://fraser.stlouisfed.org/ Denver, Colorado. Federal Reserve Bank of St. Louis Sincerely yours, Deputy Governor. FEDERAL RESERVE BANK OF NEW YORK UP. April 18th, 1917. APR2 2 1917 My dear Governor: One by one we seem to be making headway in bringing in state banks, having now gained 24 banks, leaving but 90 out of the 1025 in the district on which as yet we are unable to collect at par, except through the express company. We are having a meeting this afternoon with the Clearing House Committee and hope that this may be the beginning of closer relationship with them and they with us. Mr. Woodward unfortunately was called to Boston last night so will be unable to attend. We are picking up nearly every day some acceptances at from 3 to 3-1 % but are running off much faster than we are accumulating. I believe, however, that within a month or so we will have changed conditions so that we will probably be able to secure what we need. The Committee of the New York State Trust Companies is at work securing legislation which will permit them to deposit with the Federal Reserve Bank and have those deposits count as part of their required reserve under the New York State laws. Mr. Merritt stated to-day that they were considering having the restriction removed against counting Federal reserve notes as reserves which restriction wee instituted in the New York State _cRVE BANK OF NEW YORK -2- To Mr. Strong. 4/18/17. law on the recommendaticn of Mr. Hepburn, yourself and others. The Committee is in conference to day with Superintendent Richards and I hope may accomplish the necessary legislation. With my best wishes, I am, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK April 18th, 1917. My dear Governor: Our Committee on bonds, Governors Rhoads, McDougal and I were to have met yesterday to open bids on the offering of about $5,000,000 of the conversion 3s. McDougal could not come and Rhoads came over but we had no offerings and gave a brief statement to the press, copy of which I enclose. The reason as you understand is that the conversion 3s are not included in the list of those convertible into bonds carrying a higher rate and raises the question as to what is to be the status in the future for the plan of retirement of national bank circulation as outlined in the Federal Reserve Act unless the conversion 3s are made convertible into 3i% or 4 % bonds later, to be on the same basis as other bonds. Possibly, you can think out some new and better plan which will insure the reitrement of the national bank circulation and all.the 2 % bonds securing same. We are hoping that you may see your way clear to drop in for a few days during the time Lord Cunliffe is here so that you may visit Washington and New York, not only giving us a glimpse of you but helping in outlining the present important developments. With this goes our best wishes. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. POSTAL TELEGRAPH ' ',II/EC. AT MAIN OFFICE VT & CRAMMER ROILDING .0 17TH 8THEET D.LOIVER, COLO. TELEPHONE: MAIN 4800 COMMERCIAL CABLES CLAFIENCE H MACKAY, PRESIDENT TELEGRAM rDELIVERY "I. 19 "1 /7") TheYo'srarrelegratth-Catfarktimny(hicorporated)transmits and delivers thit-message subject to the terms and conditions printed on the 16D-30616 ck of this blank IGI MEAT 16.106211 b87 ch ja 61 CB 71ewyork apl 19-17 tenjamin qtrong 4100 Ifontview Blvd--nenver. This morning harding telephoned asking us to join with other reserve banks in offering two hundred millions treasury certificate due July first at two and one half percent have been canvassing banks and bankers today and have secured up five thirty about ninety millions it has is that rate too low and to but practically unanimous opinion created rather unfavorable impression. P. Treman...621g p"°''.- POSTAL TELEGRAPH-COMMERCIAL CABLES ALASKA VANCOUVE PACIFIC OCEAN JAPAN SAN FRAN ISCO II CANADA UNITED 4NEWFOUNDLAND VISO. AZORES YOKOHAMA MIDWAY '05/5 17 BERMUDA CUB ATLANTIC MANILA OCEAN AFRICA Sr. VINCENT PA AMA THE GREATEST TELEGRAPH AND CABLE SYSTEM IN THE WORLD. 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 CONDITIONS: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 unrepeated 'telegram rate is charged in addition. UMesstotherwise indicated on its face, THIS IS AN UNREPEA TED 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 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 REPEA TED telegram, fifty times the stun received for sending the same, UNLESS SPECIALLY VALUED; nor in any case for delays arising t:opa unavoidable interruptionbeyond in the working of its lines; NOR FOR ERRORS IN CIPHER OR OBSCURE TELEGRAMS. 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 telegram, whether caused by the negligence of its servants or otherwise, beyond fifty times the REPEATED telegram rate, at which,nount this telegram, if sent as a REPEATED telegram, is hereby valued, unless a greater value is stated in writing hereon at the time the telegram i8 offer.s. In 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 telegram over the lines of any other Company \,,er, necessary to reach its destination. Messages will be delivered free within the established free delivery limits of-the terminal office. For delivery at a greater distance a special chargep made to cover the cost of such delivery. No responsibility regarding messages attaches to this Company until the same are presented and accepted at one a its transmitting offices; and if airs, 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 deliveringthe message and any notice or instructions 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 sixty days after the telegram is filed with the Company for transmission. S. 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 AI-TI/ORIZED TO VARY THE FOREGOING. (") ADAMS, C HA Cs..< VICE-PRESIDENT. CLARENCE H. MACKAY, PRESIDENT. EDWARD REYNOLDS, VICE-PRE. STAND GENERAL MANAGER. CHARLES P. BRUCH, VICE-PRESIDENT. THE FASTEST TELEGRAPH SERVICE IN THE WORLD OPERATOR'S NOTATIONS, TIME SENT, ETC. FEDERAL RESERVE BANK OF NEW YORK April 19th, 1917. My dear Governor: We had a joint meeting of the Clearing House Committee and the Executive Committee of cur bank yesterday. Mr. Vander- lip was unable to be present but Messrs. McGarrah, Prosser, Townsend and Frew came and Messrs. Peabody, Thompson, Saunders, Jay and Treman of our Executive Committee were present, Mr. Woodward being absent. We had an informal discussion as to government bonds, Mr. Peabody expressing quite a decided opinion that the government would issue three billions as its initial offering. We discussed the removal of the exchange charge of 1/40 of 1 7. so that all banks in our district would be practically on the discretionary list, thus removing this charge. While no pos- itive action was taken at the meeting yesterday we were given to understand that this,would probably be done.soon. Mr. McGarrah Made some estimate as to the proportion of bonds which would be taken by the different sections of the country based on each billion of bonds issued and his estimate was as follows: New England t100,000,000 Chicago District 200,000,000 West of the Mississippi 200,000,000 New York and the South 500,000,000 - EDERAL RESERVE BANK OF NEW YORK ____ -2- To Mr. Strong. 4/19/17. Mr. McGarrah stated that this was merly his own estimate based on conversations he had had with bankers from different sections. He suggested that through our statistical department we might make up figures as to the wealth of the different districts and the banking resources and assuming that each section took their proportionate share see how it would work out,and this we are preparing to do. As another method of securing the desired esti- mates I telegraphed and wrote to each of the eleven reserve banks last night asking them to advise us by wire next Tuesday, after making a quiet, confidential inquiry in each district as to the probable amount which would be subscribed on two proposals: first, if the initial offering was one billion; second, if the offering was three billions. This may give us some valuable information, at least, so far as estimates can afford such. Mr. McGarrah stated that the result of the meeting yesterday gave evidence of the value of having these meetings regularly and it was decided to hold them every two weeks at the Reserve Bank. The Executive Committee also discussed our relations with some of the foreign banks and decided as follows: Bank of Naples: tions To do nothing, as in making their sugges- the Bank of Naples had thought that we would be in a position to transact commercial business. Bank of Montreal: The Committee saw no way in which we could have any definite reciprocal relations but thought it tactful to hold the matter in abeyance and talk with Lord Cunliffe. cRAL RESERVE BANK OF NEW YORK -3- To Bank of the Philippines: Mr. Strong. 4/19/17. Hold in abeyance as if the Congress enacts into law the proposed amendments, the Philippine National Bank will become a member of the System and it will be necessary to secure added information from San Francisco and elsewhere before tying up closely with it. The Executive Committee also considered and discussed the securing of additional space for handling government bonds in case the reserve banks are called upon actively to participate. With kind regards, I remain, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM nocOusx FEDERAL RESERVE BANK OF NEW YORK RHT/RitH (TO BE MATTiED) Bostal 5:45 p.m. CONFIRMATION OF TELEGRAM We have today telegraphed you as follows: ...urn 19, 1917. Benjamin Strong Esq 4100 Montview Boulevard Denver Col. This morning Harding telephoned asking us to join with other. Reserve banks in offering two hundred millions Treasury certificates due July first at two and one half percent Have been canvassing banks and bankers today and have secured up thirty about ninetymilliono but practically unanimous opinion is that rate too law and it has created rather unfavorable impression to five R. H. T.Diailaal Chge. Federal Reserve Bank 120 Broadway B-2 FEDERAL RESERVE BANK OF NEW YORK April 19th, 1917. My dear Governor: This morning we received telegram from Governor narding, copy of which is enclosed and Mr. Jay also had a telephone message informing us that the Canadian Pacific R. R. bond issue of $200,000,000 had been withdrawn and that the Secretary of the Treasury was offering to-day $200,000,000 of Treasury certificates at % and interest, maturing July 1st of which he desired $50,000,000 available to-morrow, Friday and the other $150,000,000 next Monday. He intimated that this money would be paid over to J. P. Morgan & Co. presumably for Canadian or British use. We have been spending the day, therefore, ascertaining the views of bankers here and as to their willingness to subscribe for this loan. The practically unan- imous opinion was that the rate was too low and should have been 3 % in which case we could have placed many outside of New York. As it is, we have secured subscriptions up to 5:30 P. M. of $93,000,000. The other districts are not doing proportionately as well. More to-morrow. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Gtk- 41.1.17, 44/1.. t141/- etelik-1 -2(.44404, itte (di eemit gfrirtia )144 lue Ceter-o FEDERAL RESERVE BANK OF NEW YORK 14.k. April 20th, 1917. APR 2 3 1917 My dear Governor: Mr. Jay and I lunched with Messrs. Allen and Thralls of the A. B. A. To-morrow the up-state small'state bankers have a meeting at Rochester, their creed being as per the encloeed memorandum. You will note that they expect to head off our collect- ing through the express companies, but if they succeed in this we will have to devise some other way to collect their check. it is probable that banks in the large cities would not receive these checks, although they might, if marked -Not payable through an express company". We are making headway all the time, and while we had a very pleasant luncheon with the two gentlemen and quite an extended argument with Mr. Thralls, his viewpoint is somewhat different from ours and I assume he will continue to make his fight although he stated positively that he did not favor the Kitchin Bill. This morning the morning papers stated that Senator hardwick of Georgia had introduced a bill permitting the charging of exchange end I have asked Mr. Curtis to send for some copies. With kind regards, I remain, bincerely yours, 4 Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. HHT/VCM Enc. FEDERAL RESERVE BANK OF NEW YORK April 20th, 1917. My dear Governor: Answering yours of April 16th in regard to your suggestione as to preliminary preparaticns which we have made in case we should be called upon for much additional work in connec- tion with the United States Government bond issue and as fiscal Mr. Curtis and Mr. Higgins have been in agents in other ways. consultation with the Equitable Office Corporation and we can secure a large amount of space,about 11,000 feet square,on the same floor adjacent to the space we have recently acquired, should that develop. We have this week leased another room on the Pine Street side of the fifth floor. We have been giving careful consideration to the increase of our employees, training for special work, etc., and are prepared to make reports on these subjects when you come East, as we hope you may for a few days, but expect you to then return to Denver or to the Adirondacks and not remain here longer than necessary just now. Sincerely yours, Deputy GoVernor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK April 20th, 1917. My dear Governor: I have your confiden-A.Pali213-01917 in re foreign exchange man and have read copy of letter you sent to party about whom you had intimate knowledge as to his qualifications, but felt that the matter would have to be handled very carefully. We have had suggested to us and have talked with a Mr. Jones who has been with Lazard Freres for 25 years - a man about 50 years of age or younger, has had very good experience in every branch of the detail but has not bought or sold exchange. He could probably be secured for t2500 and we have thought of him as one whc might come in now and organize the work and be able to do what might develop in the very near future, leaving the higher grade man, (should such a one be found necessary),to be secured later. We also started to-day to look up another man at the At- lantic National Bank who is highly recommended. We have followed up a great many different suggestions but in view of your letter, I am led to believe that it wouldbe wiser to secure all this data and should you come on next week or week after to see Lord Cunliffe, we could very easily go over these matters with you, having the data at hand. Will:follow this course unless you advise to the contrary. Sincerely yours, 031)4,44441144.1 DeptirrGover7 n r. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. FEDERAL RESERVE BANK OF NEW YORK April 20th, 1917. My dear Governor: I have your five letters of April 16th. I note your thought that one officer at the Briarcliff meeting is sufficient. My opin- ion was based on the fact that undoubtedly there will come up at that meeting more or less criticism of the Federal Reserve collection system and its doing away with exchange charges and that we should be able to answer any criticism. Sincerely yours, Deputy Governor. Benjamin Strong; Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK h(1 April 20th, 1917. APR 2 3 1917 My dear Governor: Regarding the treatment of those employees of the bank who may enlist will state that this has been held in suspense until the next meeting of the Board. Mr. Towne has been gathering considerable in- formation on this subject and stated a few days ago that he would present data as to what was being done by others. Governor Aiken is spending the week in Washington at the Hotel Shoreham with his family, I believe. Imagine that things are moving so rapidly down there that he will be unable to take much rest. Sincerely yours, Depefr6;;:rnor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Misc. 34 F ',RAI RESERVE BANK NEW YORK (TO BE MAILED) RHT/VCM 1:15 P. M. CONFIRMATI LornrELEGRAm We have today telegraphed you as follows: April 20, 1917. Benjamin Strong, 4100 Montview Boulevard, Denver, Colorado. Just received following telegram from Washington: Quote. Owing to delay in conference report on war bond bill Treasury certificates cannot be dated or issued before about next Tuesday or Wednesday, while responses from Large: cities have been entirely satisfactory Secretary has decided in order to create wider market and to give country banks opportunity of subscribing to place them at 3 percent interest instead of 2i. You are requested to notify your member banks accordingly and receive subscriptions on this Action very basis. Certificates will mature June thirtieth. End quote. much approved here. Stop. Total subscriptions received by us thuH far about hundred and ten millions. R. H. Treman. B-2 Charge to Federal Reserve Bank, http://fraser.stlouisfed.org/ Equitable Building. Federal Reserve Bank of St. Louis WESTE Nits TEL NL these three symbols .er the check number of .nis is edgy message. Othercharacter is indicated by the appearing after the check. NEWCOM B CARLTON, PRESIDENT UNION AM CLASS OF SERVICE SYM st,,_ Day Message Day Letter Blue Night Message Nita NL If none of these three symbols Night Letter GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT appears after the check number of words)this is a day message. Otherwise its character is indicated by the symbol appearing after the check. EIVED AT ?aV(f.\9\1 C212CH 109 BLUE 1917 APP 20 PM Q. NEW YORK NY 347P 20 PR .BENJAMIN STRONG 7 54 JA66 4100 MONTVIEW BLVD DENVER COLO TO DELAY ,i1JST,RECEINED FOLLOWIV TELEGftAM FROM WASHINGTON QUOTE OWING CERTIFICATES CANNOT IN CONFERENCE REPORT ON WAR:MOND BILL TREASURY - OR WEDNESDAY WHILE ' BE DATED OR ISSUED BEFORE ABOUT NEXT-TUESDAY RESPONSES FROM LkRGER'CITIES1HAVE BEEN ENTIRELY SATISFACTORY SECRETARY HAS DECIDED IN ORDER TOACREATE WIDER MARKET AND TO GIVE COUNTRY .BANKS OPPORTUNITY OF SUBSCRIBING TOtPLACE THEM AT:3-PERCENT 'INTEREST INSTEAD OF SUBSCRIBING TO PLACE THEM AT 3-PERCENT 'INTEREST INSTEAD OF 2 1'-2 YOU ARE REQUESTED TO NOTIFY yoo ,0 CLASS OF SERVICE SYMBOL SERVICE Day Message sage tter , Night Message Blue Blue Day Letter Nile Night Message Nits Night Letter N NL Night Letter none of these three symbols pears after the check (number of If none of these three symbols appears after the check number of words)this is aday message. Otherwise its character is indicated bythe ords)this is a day messagm OtherIse Its character is indicated by the mbol appearing after the check. NEWCOMB CARLTON, PRESIDENT GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT CEIVED AT C212CH SHEET symbol appearing after the check. 1917 APR 20 PM 7 54 TWO MEMBER BANKS ACCORDINGLY OD'RECEIVE(SUBSCRIPTIONS ON THIS BASIS CERTIFICATES WILL MAUTRE JUNE THIRTIETH END QUOTE ACTION MUCH, APPROVED HEREISTOP TOTAL SUBSCRIPTIONS RECEIVED BY US, 'THUS FAR ABOUT ,HUNDRED AND TEN MILLIONS OT VERY ra Form 1204 CLASS OF SERVICE SYMBOL Day Message it Letter I L of these three symbols Blue Plight Message Nite Night Letter NL If none of these tliree symbols after the check (number of appears after the check number of its is a day message. Oth erdiameter is indicated by the words)this is a day message. Other-. wise its character is indicated by the NEWCOMB CARLTON, PRESIDENT wearing after the check. OX" BRAM V 03 AT I1D BY 109 BLUE Day Letter DUP OF FONED MESSAGE symbol appearing after the check. uncl, WZ7 L001, TELAPHONB TORX 254E. Q NEWYORK N Y 347 PM APL 20-21 ffNJAMIAN STRONG 4100 MONTVIEW DENVER COLO WASHINGTON QUOTE OWING TO DELAY UST.RECEIVE FOLLOWING TELEGRO Fr) BOND BILL TREASURY CERTIFICATES CANNOT N CONFERENCE REPORT ON WAR E DATED OR ISSUED BEFORE ABOUT NEXT TUESDAY OR WEDNESDAY HI;,J RESPONSES FROM LARGER CITIES HAVE BEEN ENTIRELY SATISFACTORY :CKETARY HAD DECIDED IN ORDER TO CREATE WIDER MARKET AND TO IVE COUNTRY BANKS OPPORTUNIEY OF SUBSCRIBING TO PLACE THEM AT HREE PERCENT INTEREST INSTEAD OF 21 -2 YOU ARE MEMBERS BANKS ACCORBINGLY AND RECEIVE EQUESTED TO NOTIFY YOUR 'ILL MATURE JUNE THIRTIETH IIBSCRiPTIONS ON THIS BASIS CERTIFICATES QUOTE ACTION VERY MUCH APPROVED HERE STOP TO-TAL SUBSCRIPTIONS EIVED BY US THUS FAR ABOUT HUNDRED AND TEN MILLIONS H HREMAN 1 056 AM FEDERAL RESERVE BANK OF NEW YORK April 25th, 1917. My dear Governor: Reached New York this morning. Subscriptions up to 10 o'clock A. M. amounted to $134,000,000 plus, of which $106,000,000 plus were subscribed at 21- %. Philadelphia reports that they will take $11,000,000. Aiken has just come in the bank and goes with me to Washington for a dinner to be given by Secretary McAdoo to Lord Cunliffe tonight. Rhoads joins us at Philadelphia. Bank tried to reach you yesterday all day but failed. Hope that you can certainly come on to Chicago to meet Lord Cunliffe but think it preferable to come to Washington if ti will not be too great a strain upon you. I have your letter stating that you will certainly return the first week in June. Hope to be back tomorrow morning to attend the Directors meeting here and will write you more at length. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM 4W . 5 OF SERVICE SYMBOL e, Letter M. Night Messes- Mte WESTE Ca, AJ. SNA Message UNION WESTERN UNION TELve AM wa NL Night Letter If none of these three symbols appears after the check number of words )this isaday message. Otherwise its character Is indicated by the symbol appearing after the cheek. NEWCOM 5 CARLTON, PRESIDENT Day Messes Day Letter Blue Night Message Nita Night Letter NL If none of these three symbol, appears after the check number o words this is aday message. Other wise its character is indicated by th, GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT symbol appearing after the check RECEIVED AT .-tzLIUT.111 Ttt 1.917,4 PR ! 26 PM 5 22 NEwYORK NY 1P 26 AmIN 3TRONG 1254 4100 MONTVIEw BLVD ENVER. COLO ,FIED YOUR MOTHER AND ENGAGED ROOM AT HOTEL PLAZE BEGINNING RNING STOP ANTICIPATE YOUR COMING WITH PLEASURE STOP TRYING _RD CUNLIFFE TO AR_ANGE FOR DINNER H Q.LEANii FEDERAL RESERVE BANK OF NEW YORK o May 15th, 1917. '9\1 Dear Governor Strong: Bank England. We received by registered mail this morning a package from the Bank of England containing signature cards, a special code and memorandum of igreement, together with two letters, copies of which I enclose herewith for your information. We will, of course, make formal acknowledgment and if you have any suggestions as to other matters to be taken up in connection with this kindly advise. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHT/VCM Enos. FEDERAL RESERVE BANK OF NEW YORK Or to 00"\ May 15th, 1917. My dear Governor: I earnestly hope that you reached Denver safely and that your strenuous ten or twelve days here did not affect you adversely. Mr. Woodward did not return home yesterday but is expected to-day and I will endeavor to see him before he sees Mr. Perkins. The Government bond Department seems to be assuming shape although there are some conflicts of work and other matters which need to be straightened out. The Federal Reserve Board has postponed the inauguration of the Federal exchange system until June 1st. Yesterday I sent out a communication to each of the Governors asking their opinions on certain questions pertaining to the detail of the plan, after receiving which we will formulate our views as to certain modifications in the plan and forward to the Reserve Board. We only purchased about 350,000 of bills yesterday. Everything seems quiet pending the floating of the Liberty Loan. With kind regards, I remain, Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. http://fraser.stlouisfed.org/ RHT/VCM Federal Reserve Bank of St. Louis FEDERAL RESERVE BANK OF NEW YORK May 16, 1917. MAY 2 0 1917 My dear Governor: We have an adverse balance of $40,000,000. today at the Clearing House, caused largely, we interpret it, by J. P. M. ci Co. placing the ten checks of $5,000,000. each paid them yesterday for the British' Government account in the city banks and instead of their depositing them with us, sending them through the Clearing House. We will withdraw $25,000,000. from the $126,000,000. in the Gold Settlement Fund and strengthen our cash position. We have done nothing about the foreign exchange man, es we interpreted it that you had some plan in your mind as to the proper ones to secure and were expecting to wait until your return to carry out those plans. We hear nothing definite as yet as to the Hardwick amendment settlement, but assume that it will become law with the Owen Bill enactment. We have authorized our representatives, i. e. the express companies and others, to accept New York Exchange from the nonmember banks in payment of their items when presented in case it was not convenient for them to remit in cash. The Newton Bill was made a thirtyday bill at Albany, which will give them time to await developments as to the Hardwick amendment. Matters in the Bond Department are shaping up so that it will be an active organization soon. Mr. Jay, I understand, had a talk with Mr. Woodward yesterday about securing the party to take my place. Benjamin Strorg, Esq. BANK OF NEW YORK 5/16/17. I trust that you are living on the golf links as much of your time as is possible and that you will continue to gain strength and vigor pending your return. I am making my plans to remain until July let, as you suggested, and hope that by that time you will have secured the other party to take my place. With kind regards, I remain, Sincerely yours, Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colo. FEDERAL RESERVE BANK OF kV*? RK MAY2 0 1917 May 16, 1917. Dear Governor: The Executive Committee met to-day, Mr. Vanderlip being absent up-state in connection with the Liberty Loan. Mr. McGarrah brought up the question of the correspondence between himself and you as to settling balances at the Clearing House. This led to some discussion and then Mr. Frew stated that a prominent banker had made suggestions to him which he had incorporated in a paper, copy of which I enclose to you. There was considerable argument as to the advisability of having Federal reserve notes not only as reserves for banks but also as legal tender, and Mr. Frew made a motion that the matter be taken up with the Reserve Board, but at the suggestion of one or two present he withdrew it. I enclose a memorandum which Mr. Gidney prepared, which possibly you Shave not seen. Informal exchange of views was about all that was accomplished to-day, but I think these meetings are really helpful in framing sentiment. Very truly yours, Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colo. RHT/CEP FEDERAL RESERVE BANK OF NEW YORK May 17th, 1917. My dear Governor: We have been notified to-day that we will be expected to pay out on Saturday $50,000,000 to France and we // are notifying the banks in which the $100,000,000 are deposited to make partial payments on Sat'urday. mr. Crosby has // agreed to give us 48 hours advanee notice of these matters. Mr. Jay was advised/by Mr. Crosby to-day that another issue of $100,000,c0o of certificates of indebtedness would be issued, payable hext Thursday, May 24, maturing July 30, 1917. The Liberty/Loan Committee discussed same this morning and recommen'ed that the rate be 3 1/4 per cent. and I understand Mr. Crieby said he would consider same favorably. I learn4 to-day unofficially that there is being a strenuous effort made on the part of business interests to defeat the Hardwick amendment and assume the matter will be determined this week. With kind regards, I remain, Sincerely yours, /e,1)'61-14 Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. RHTPCM FEDERAL RESERVE BANK OF NEW YORK a(1. ter. May 17th, 1917. MAY 2 2 1917 .e,y dear Governor: In the matter of Federal reserve exchange, most of the Governors seem to prefer a uniform form of draft and seem to be agreed on the main points about which I asked their opinions. We are having forms prepared by Mr. Jefferson and they will be ready by to-morrow to submit. I regret that we cannot postpone the inauguration of the plan longer than the first of June to give it more consideration, but perhaps a trial of the system will be the quickest way to bring out whatever defects there are in it and demonstrate whether it will fulfill a need. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 1ontview Boulevard, Denver, Colorado. RHT/VCM FEDERAL RESERVE BANK OF NEW YORK 114k May 18th, 1917. MAY 2 2 1917 My dear Governor: In the matter of Federal reserve exchange, we have pre- pared forms for both the exchange and transfer drafts, samples of which I enclose herewith for your information. We expect to send them to the reserve banks for their consideration and then pass the suggestion on to Washington for their final decision. We are in receipt of a telegram from Assistant Treasurer Crosby announcing an additional issue of300,000,000 of 3 t 5 Treasury certificates and we are issuing a circular letter this afternoon to not only our member banks but state banks, bond houses, etc. We hope the additional quarter percent may assist somewhat in placing them. Mr. Crosby was somewhat averse to making the rate higher than 3 °A but finally decided to do so as it is a com- promise between those who favored 3 and those who favored 3k %. We learned last night that the hardwick amendment is being strongly debated and much opposition to the passage has develed. We assume that a decision will be made to-day or to-morrow. I assume that either Mr. Jay or Mr. Curtis is keeping you posted as to the Liberty bond matter so I am not touching upon this in my letters. Are you keeping in touch with J. H. Perkins or will Mr. Woodward, as Chairman of the Directors Committee, follow that up? 2 ERVE BANK OF NEW YORK I, of course, have Mr. Strong. To not felt that I should be the one to discuss this with him unless he desired it. Sincerely yours, Deputy Governor, Benjamin Strong, Esq., 4100 montview Boulevard, Denver, Colorado. RHT/VCM Enos. May 18, 1917. FIRST NATIONAL BANK No. SYRACUSE, N. Y. 50-36 SYRACUSE, N. Y., P AY 191 TO THE ORDER OF DOLLARS THE FEDERAL RESERVE BANK OF WILL PAY THIS CHECK UPON ADVICE CASHIER FROM AND FOR ACCOUNT OF THE FEDERAL RESERVE BANK OF NEW YORK 1.120 SEND BY FIRST MAIL TO THE FEDERAL RESERVE BANK OF NEW YORK. ,ea OOOOO FIRST NATIONAL BANK No. SYRACUSE, N. Y.._ TO 191 FEDERAL RESERVE BANK OF NEW YORK. THIS SPACE WE HAVE DRAWN CUR FEDERAL RESERVE TRANSFER DRAFT ON YOU PAYABLE AT THE FEDERAL RESERVE BANK OF 191 IS TO BE USED AS THE MEMBER BANK FOR $ DESIRES FAVOR OF _ DOLLARS RGE OUR ACCOUNT. SIGNED CASHIER ILITY AT PAR. CASH/ER SYRACUSE. N 191 ORDER OF cc 0 ow u < SOLD TO (1) (.9 wcr m Z2 AMOUNT_ EXCHANGE _ <w 2a 2 PAYABLE AT FEDERAL RESERVE BANK OF Lt. z0 No. FIRST NATIONAL BANK z SYRACUSE. N. Y. Lv.1 191_ iv r.Z 2 r_F < < W 2 Z :..` 2 z0 z 7 z w U ORDER OF SOLD TO Zw 173 5w AMOUNT $ in I l i, re EXCHANGE $ FEDERAL RESERVE BANK OF NEW YORK May 22nd, 1917. My dear Governor: I cannot tell you how glad I am to have your letter of the 19th in which you state that Dr. Sewall has telephoned you an excellent report of the examination he made after your return. Just keep up the good work, the outdoor life and the rest as much as you can. Mr. Jay being away on Saturday and Sunday for rest, I stayed until Saturday noon and spent Sunday and Monday in Ithaca, returning this morning. We are having an oversubscription of the 34- 7. certificates up to to-night, there being about $80,000,000 subscribed from the eleven districts and we have $92,000,000 firm with pros4.1ww pects of about $40,000,000 additional to-morrow. The Committee in conference over the Owen Bill with the Hardwick amendment is still in session. Much opposition seems to have developed on account of the business interests regarding the passage of the Hardwick amendment, so its future is still unsettled. You will note by the enclosed copy that Governor Whitman has signed the martin Bill but the Newton Bill regarding exchange is still in abeyance and is a 30 day bill. Sincerely yours, Deputy Governor. Benjamin Strong, Esq., 4100 Montview Boulevard, Denver, Colorado. Form 1201 OF SERVICE SYMBOL Blue ge _etter *hese i Mears after the ch.t .... WESTEoap. UNION AM TEL WESTERN UNION Nite NL nbols of words)this is a day messr wise its character is indicated by the symbol appearing after the check. NEWCOMB CARLTON, PRESIDENT GEORGE W. E. ATKINS, FIRST VICE-pRESIDENT RECEIVED AT 915-919 SEVENTEENTH ST., DENVER, COLO. 289NY AZ 27 1 EXTRA CLASS OF SERVICE SYMBOL Day Message they Letter Blue Night Message Rite N'gtit Letter NL If none of these three symbols appears after the check number of words)this is a day message. Otherwise its character is indicated by the symbol appearing atter the check. AL6vp1ris '11 tre.:47 MitCr4 Q NEWYORK NY 356 PM MAY 23 1917 ..NdAm IN STRONG 1:11 ,471t 4100 MONTVIEW BLVD DENVER COLO SUBSCRIPTION OF DISTRICT NUMBER TWO TO CERTIFICATES OF INDEBTEDNESS TO BE ISSUED FRIDAY ONE HUNDRED AND SEVENTY FIVE MILLION FIVE HUNDRED AND EIGHTY ONE THOUSAND DOLLARS TREMAN GOVERNOR 223 PM im Form CLASS OF SERVICE DESIRED ' Day Message WESTE E 04.162N UNION M VSTERN UNION Night Message Night Letter Patrons should mark an X opposite the class of service desired; OTHERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. TEL %VW /11F Receivers N Check Time Filed NEWCOMB CARLTON, PRESIDENT GEORGE W. E. ATKINS, VICE-PRESIDENT BELVIDERE BROOKS, VICE-PRESIDENT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to New York City May 23, 1917. Benj. Strong. Denver. Subscription of district No. 2 to certificates of indebtedness will be issued Friday 4175,581,000. R. H. Treman. _L TELEGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING TER uard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for comm.. .. r this unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPL'ATED TELEGRAM AND PAID FORM. UCH ttion whereof it is agreed between the sender of the telegram and this Company as follows: he Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond the amoun 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, 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 obscur, 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, whethel be 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 on 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 t. thereof. he Company is hereby made the agent of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to reach it: elegrams 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 c, yond 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 tc him for such delivery at a reasonable price. o 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 offict he Company's messengers, he acts for that purpose as the agent of the sender. he 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 le Company for transmission. mcial 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 al. terms. o employee of the Company i8 authorized to vary the foregoing. THE WESTERN UNION TELEGRAPH COMPANY INCORPORATED NEWCOMB CARLTON, PRESIDENT CLASSES OF SERVICE AY MESSAGES ate expedited service. M ESSAGES 3d up to 2.00 A.M. at reduced rates to be sent during the night ered not earlier than the morning of the ensuing business day. TT E: RS rred day service at rates lower than the standard day mess as follows: One and one-half times the standard Night ,te for the transmission of 50 words or less and one-fifth of 1 rate for each additional 10 words or less. SPECIAL TERMS APPLYING TO DAY LETTERS: her consideration of the reduced rate for this special "Day service, the following special terms in addition to those enu- Letter shall be delivered on the day of its date absolutely and -at all events; but that the Company's obligation in this respectig 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 LETTE RS Accepted up to midnight for delivery on the morning of the next 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. 3,bove are hereby agreed to: iy Letters may be forwarded by the Telegraph Company as a service and the transmission and delivery of such Day Letters I respects, subordinate to the priority of transmission and of regular telegrams. ly Letters shall be written in plain English rmissible, Code language us Day Letter may be delivered by the Telegraph Company aoning the same to the addressee, and such delivery shall be a discharge of the obligation of the Telegraph Company to his Day Letter is received subject to the express understandagreement that the Company does not undertake that a Day 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 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 yarn the forenoina. FEDERAL RESERVE BANK OF NEW YORK July 16, 1917. Benjamin Strong, Esq., 128 Gilpin Street, Denver, Colorado. Dear Governor Strong: I spent yesterday in Ithaca, returning this morning and we have had quite an eventful day as will be shown by the report enclosed. I had two talks with Mr. McGarrah who stated that they tried to hold the rate to 6% but there were very heavy maturities to-day, among them .1;',50,000,000 of French credit and in addition there was the after-ef- fect of the payments for New York City bonds, etc. Strong demand for money and very few banks are in a position to loan as they were close to their reserves. Of the ,;r40,000,000 loaned on call about 40,000,000 were at 6%. Expect the governors and a number of others to report to-morrow for a several days, conference as arranged by Mr. Jay. I hope you are taking in all the ozone possible and not giving much thought to banking matters. There will be plenty to do on your re- turn. Best wishes. Sincerely yours, Enc. FEDERAL RESERVE BANK OF NEW YORK July 17, 1917. Dear Governor Strong: Your article on the importance of saving in connection with the next government loan and your suggestions connected therewith received most favorable comffendation,as they deserve to. We have had a very pleasant call to-day from Governor Rains, who is looking in fine shape. He and you, as you look now, would certainly make a good pair of healthy, vigorous men. Mr. Warburg dropped in this morning and goes back to Washington to-night. We had a talk with Mr. McGarrah to-day and impressed upon him the importance of keeping the call money rate down. Mr. McGarrah has talked with a number of other bankers to-day and reports this afternoon that some are reluctant to go into the same arrangement as before but evidently there will be some cooperation in trying to keep the rate down to 6 or less. To-day the renewal rate was 6 and closed at 5. Governors Seay, Rhoads, Aiken, McDougal and Fancher, with a number of associates, in all about 25 or more, are here. They have been working at 50 Wall Street but how much they have accomplished I have not been advised. We all expect to lunch together at Hahns so that they can work again this evening. The enclosed letter will give you the details of to-day's business. Curtis brought over from Washington the reporter who has attended the governors' conferences, he bringing two assistants with him for the work of this conference and Curtis will frame up the results. Only two or three of the other banks are participating with us in investments and I shall take up with them While here their going in with us again ANKOFNEWYORK 2 7/ 17/ 17 as it would help our situation in New York just now and it would seem fair that they should join with us at such times rather than put the burden upon us of carrying the load. Only Chicago, Kansas City and St. Louis are participating at present, I believe. Kind regards. Very truly yours, Benjamin Strong, Esq., 128 Gilpin Street, Denver, Colorado. Enc. FEDERAL RESERVE BANK OF NEW YORK July 18, 1917. Benjamin Strong, Esq., 128 Gilpin Street, Denver, Colorado. - Dear Governor Strong: The five governors and others, twelve in all, dined at the Har- vard Club last night and worked until midnight over the bond selling and other details. To-day Governor Kains cane in and lunched with us at the Bankers Club and we had a discussion on the collection system, especially the proposals of Mr. Delano. proval. Your suggestions were read and met with general ap- No difference of opinion among the governors that the suggestions were not such as to justify their being put into effect. The executive committee met to-day and discussed the organization for the bond department and I think we are gradually coming to see things alike and within a day or two shall be able to begin active development. Mt. Jay will probably advise you in detail. The governors seem to feel that there should be another conference of the governors the middle or latter part of August. Very hot and sultry here. Will try and write more in a day or two when the rush is over. Sincerely yours, RHT/ELS FEDERAL RESERVE BANK OF NEW YORK July 19, 1917. Benjamin Strong, Esq., 128 Gilpin Street, Denver, Colorado. Dear Governor Strong: You are entirely right in keeping your correspondence limited to an extreme. Mr. Kent has had several interviews with the Italian gentlemen and told me that he would write you in detail concerning their position. Briefly, they propose three things: They to earmark in Italy most dollar exchange here. They to make all collections in Italy for the Federal reserve bank. We to enter into an arrangement with the Bank of Italy somewhat similar to that with the Bank of France. They also made some other suggestions regarding the purchase of bills but Mr. Kent evidently has handled them with great care and has shown them much courtesy. I assume that we shall receive an application from them eventually in which they will outline the basis on which we can serve them and they us. I doubt if we can do anything for them other than to make a formal agreement for such reciprocal arrangements as may be subsequently agreed upon and make such arrangement subject to the change at the option of either party. I have arranged to have a copy of the daily statement and of the bills maturing and purchased sent to you each day. Regarding the call money market this week, you already understand the reasons, but the principal one, aside from the unusual congestion on that particular day, is due, it seems to me, to the shifting of bank reserves of the country banks into the Federal reserve bank. We have had a very delicate money market for the past week and expect it will continue until to-morrow or more probably early next -4RAL RESERVE BANK OF NEW YORK z 7/19/17. Benjamin Strong, Esq. week. The Government will transfer to us ' 150,000,000. to-day and to-morrow which we shall put out on order to Great Britain and probably Italy and Russia. On Monday we shall make another payment of :;;,50,000,000. probably to France, making a total of 200,000,000. at this time and the Government will make another transfer of ;;100,000,000. to us on Monday or Tuesday, thus saving us from making any with- drawals for the immediate present from the banks in which the Government funds are deposited. The copy of the daily letter to Mr. Warburg and the statement sent you will give you the details of the business. The executive committee has finally approved of developing an organization for the Bond Issue Division by making Mr. Sailer responsible and directing head, he to secure first-class assistants and make up an immediate organization. Sailer is to be relieved of many of his detail duties, placing most of them on Hendricks who will be practically, if not so called, first assistant cashier. We shall probably have Hendricks take a desk where he will be interrupted less and Higgins or some other assistant cashier will be the one to receive the callers and interruptions, turning over to Sailer the most important. I have suggested to Sailer that he should, in any event, arrange his work to do less detail and to give more study and thought to the perfecting of the 'different departments in our organization, as SDIT4 of them need study. This will promote Hendricks in the responsibility of his of- fice and will entail the securing of probably two assistant cashiers, one being from the country probably, as we talked. I assume Mr. Jay will write you regarding tha details of the Government loan organization as soon as he has a little leisure. Most of the Liberty Loan people, including Governors Rhoads and Aiken returned home last night but Governors NbDougal, Fancher and Seay are here to-day attending Mr. Jay's informal conference on the subject of the "savings" organization. Mr. Sailer having been unable to get a report from the Liberty Loan department finally took up the question of the deposits of Government money and this morning BANK OF NEW YORK ...7 Benjamin Strong, Esq. 7/19/17. showed me a detailed report of the excess and deficient balances which he proposes to immediately readjust and there will probably be about 020,000,000, to be deposited in banks which have qualified but up to the present time have had no redeposits. I am mighty glad to hear of Dr. Sewall's report but shall defer expressing any opinion as to the date of your return until my next letter. Best wishes as always. Sincerely yours, Enc. Dictated but not read. 0/111 1.4 CLASS OF SERVICE SYMBOL y Message ..y Letter Blue Night Message Nile ht Letter NL WESTERN UNION If none of these three symbols appears after the check number of words)this is a day message. Otherwise its character is indicated by the symbol appearing after the check. OrRECEIVED UNION WESTEL, TEL AM Day Message Day Letter Bi a Night Message Nile NL Night Letter If none of these three symbols appears after the check number of words)this is a day message. Otherwise its character is indicated by the GEORGE W. E. ATKINS. FIRST VICE-PRESIDENT NEWCOMB CARLTON, PRESIDENT CUSS OF SERVICE SYMBO, symbol appearing after the check. AT Al3D KG 47 Q NEW YORK NY 1225 P JULY 23 -17 STRONG 128 GILPIN ST DENVER LE JUST RECEIVED READS Nu) ' CUWIld AN1) ENEMY sit4onla STUP HAVE WEEK KOO BILL STOP CALL MONEY OPENED 'FEW BILLS LEAVE IN NORMANDY ALL WELL R IN WASHING-10 UN lAviNG AND RENEWED A THREE OFFERED AND LOANS ONLY IN SMALL AMOUNTS TREMAN 1146AM ' wlim NOW TWO STOP STOP VERY HOT HERE 7 Form 1201 CLASS OF SERVICE SYMBOL WESTEkiSSA UNION sikeL AM , -essage atter Night Message Blue NI+ ,etter NL If none of these :hree symbols appears after the check number of wordslthis is day message. Otherwise its character is indicated by the symbol appearing after the check. RECEIVED AT WESTERN UNION . NEWCOMB CARLTON, PRESIDENT GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT CLASS OF SERVICE SYMBOL I Day Message Day Letter Blue Night Message Nit - NL Night Letter If none ar these three symbols appears after the check number of words)this is a day message. Otherwise its character is indicated by the symbol appearing after the cheek. S. E. CORNER PINE AND MONTGOMERY STS., SAN FRANCISCO A Mil s 281NY OC 47 BLUE Q N EWYOR K NY 1225P AUG 2 1917 1293 BENJAMIN STRONG 128 GILPIN ST DENVER COLO AM fiN ACCORD WITH YOUR SUGGESTION AS TO NOT PURCHASING CERTIFICATES EXCEPT POSSIBLY IN SMALL LOTS TO ROUND OUT STOP WE MAILED CIRCULAR LETTER AND FORMS TO MEMBER BANKS LAST NIGHT STOP ANTICIPATE OVERSUBSCRIPTION THIS ISSUE STILL VERY HOT HERE CURTIS BEGINS VACATION TODAY ALL SEND GREETINGS )- R H TREMAN 414PM POSTAL TELEGRAPH -COMMERCIAL CABLES -..;EIVED AT MAIN OFFICE EfIT CRAMMER BUILDING 920 17y9 STREET DENVER, COLO. T9LILP.H0NE: MAIN 4500 CLARENCE H. MACKAY, PRESIDENT TELEGRAM DELIVERY No. 4_;) ( The Postal Telegraph-Cable Company(Incorporated)transmits and delivers this message subject to the terms and conditions printed on the back r th 16-32352 I blank DESIGN PATENT 14. 40529 II r I224P leit'tEw ,y93PWAG 0A BENJ.MIN Lt('' TRW* 128 GILPIN ST - o1 TFLEPIVI0NE0 . ...... T - DENVER COLO _ BI-- ----- VERY MPORTANT INTERNATIONAL MATTER HAVING ARISEN I THINK IT MO I/TORTANT YOU BE HFRE ON MONDAY OR AT THE LATEST TUESDAY MORNING FOR PI-PORTANT CO1'iRENCE TUESDAY WITH GOVERNOR HARDING AND OTHERS E77P YOUR COMING CONDIDENTIAL. R H TPTTMA1T POSTAL TELEGRAPH-COMMERCIAL CABLES ALASKA ENGLAND VANCOUVER PACIFIC OCEAN 11.1 11JAPAN SAN FRAN ,ISCO YOKOHAMA BERMUDA ATLANTIC OCEAN HONOLULU 4f MANILA ST. V INCEN GUAM THE GREATEST TELEGRAPH AND CABLE SYSTEM IN THE WORLD. EXTENDS OVER TWO-THIRDS OF THE WAY AROUND THE EARTH. THE POSTAL TELEGRAPH-CABLE COMPANY (INCORPORATED) TRANSMITS AND DELIVERS THE WITHIN TELEGRAM SUBJECT Td THE FOLLOWING TERMS AND CONDITIONS: 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 tills, one-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on i 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 delaya in the transmission or delivery, or for non-delivery, of any UNREPEATED ttel gram, beyond the amount received for sending the same; nor for mistakes or delays in the transmission or delivery, or for nomdelivery,,,af any REPEATED telegram, beyond fifty times the sum received for sending the same, UN-LESS SPECIALLY VALUED; nor in any ease for delays arising from unavoidable interruption ID the working of its lines; NOR FOR 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-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 REPENTED telegram, is hereby valued, unless a greater Value is stated In writhig hereon at the time the telegnam 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. 8. The Company is hereby made the agent of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to 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. 6. No responsibility regarding messages attaches to this company until the same are presented and accepted at one of its transmitting offices; and if any message is Bent to such office by one of this Company's messengers, he acts as the agent of the sender for the purpose of delivering the message and any notice or Instructions regarding it to the Company's agent in ifs 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 sixty days after the telegram is filed with the Company for Mansmission. Ti' a e terms and condifirms shall he binding upon the receiver as well as the sender of this telegram. .. EMPLOYEE OF THIS COMPANY IS AUTHORIZED TO VARY THE FOREGOINn.l. ,-- , 2S C. ADAMS, CH III NICE-PRESIDENT. CLARENCE H. MACKAY, PRESIDENT. EDWARD REYNOLDS, VICE-PREST. AND GENERAL MANAGER. CHARLES P, BRUCH, VICE-PRESIDENT. THE FASTEST TELEGRAPH SERVICE IN THE WORLD OPERATOR'S NOTATIONS, TIME SENT, ETC. FEDERAL RESERVE BANK OF NEW YORK November 14, 19 /7 iviy dear Ciovernor: When at Ithaca last ;::>aturday at _,ntling a meeting of the Cornell trustees, I was invite y Dr. Schuman to attend a meeting described in the rolosed letter and at that meeting I heard Professor has recently come from one o avenport, a professor who the 'Western universities to Cornell, propound some of. AlS views as outlined in the enmai" closed letter. took dee Lied issue with him as did two or three f the other of t) u have plenty of leisure and are rested, When I shall be gi trustees and I think we made a "dent." d. to have you give me your views on the pro- esals of tese various economists for my own satisfaction. /With kind regards, I am, -.6incere1y yours,. zenjamin Strong, Lsq., The Homstead, Hot 3prings, Va. #IIT/ELS Enc. FEDERAL RESERVE BANK OF NEW YORK December 1, 1917. Benjamin 3trong, Esq., 0/0 Honorable Paul IL:. r2reasury Building, .,;ashingto-n, D. G. idy dear C)overnor: but found I called you by telephone this afternoon not to disturb you. that you were in a meeting so advised them You will recall talcing a memorandum of recommendations among the officers, from Mr. Sailer in reference to rromotions to me on that etc., and said that you would write a memorandum subject. Tuesday next, I assume that as you will be here on in person or advise me so that our you will present the matter to me should be recommittee can make their report which seems other committee on the ported on next week in order that the officers can be carefully .alaries of those below the junior considered'and submitted to you. Very truly yours, Mai PALS Denver, Colorado, Larch 2, 1917. Dear Mr. Treman: Thank you for repeating Governor Pallain's cable which interested me very much. oposed ar sement by our considerable sentiment attached to th' French friends and they are most pun llious, more so the way, in making courteous acknowle this kind in order to evidene It is most important of course, will send no it may be well to are net %xpected in Loud' Feder New Yor BS/CC remaa, Esq., eserve Bank, I eats and we are by sead) expressions of sfaction. ,:t we don't so I, llain direct from here, but a CI unications to r in ,ind that if cluded, it will be R. ze that there will be I suppose you and the others -5 purposes hen matters are finally con:13 e of felicitations. Such things ut they are much appreciated in Paris. Denver, Colorado, March 3, 1917. Dear Mr. Treman: Yours of the 28th is just received. is certainly moderate, it of renewal credits s the home and York which particularly for headquarters of these awful instrumento I will prepare a sketch of a lett concerni. ago. Dr. Willis is the man o corresnend .Joh I w ry sincerely 11. H. Treman, asq., Federal Reserve Bank, New Yoric City. the Argen e well to d In the meantime don't you think the Philippine Bank arrant; In 44, rs, matter. 31 ethind about ote you sometime Denver, Colorado, Harch 3, 1917. Dear Mr. Treman- Not hearing further about Assay Office charges, I am getting a little uneasy about delay in dispatching the letter to Pa/lain, so have copies and two prenared a new letter and a new memorandum, tvo extra copies in each case, which I am o these now accord with the situation as sing with t assay office cs your own views at the bank, they might as well be sent b letter, and if ges and with be earliest moils. I have written Mr. C be prepared and sent. P1 memorandum and the 1 ter changes which occur to If, on consultatio entrust these packages request that one env knows him wel Mr. C changes made in both the make any necessary further h Whom you are advising. deem it wise to do so, do not hesitate to sserand, the French Ambassador, with a next; by one mail and the other by the n anti event, I would be disposed to use care n steamer direct to France and not via that they ILl s to just how these should England. of Channel mail and avoids the British Censor; if sent by It obviates mail direct an Don't t by Ethbassy Pouch, they should be registered. me over cautious about these details, because many an important matter has gone badly astray through one little slip. Once more, let me cautior you that this is a most important transaction and 1 am keen that nothing be overlooked. ports her Without any of the ex- to discuss the matter, I do not want the Bank to rely too 2/ To - Er. Treman. L1arch 3, 1917. comolete/y on my own language in either letter or memorandum. Best success to this interesting development and than:4s for your Patience in the course of its preparation. Faithfully yours R. H. Traman, Esq., Federal Reserve Bank, New York City. P.S. Enos. I will leave it to cables monied enclose copies of the siour Pallain. Also please malt The one thing I feel from here is the price at shipped. I have no me calculation in connect done. rtain about getting exactly accurate ench gold is to be ear-marked or - the figures or the exchange d must rely on you to have that Denver, Colorado, March 4, 1917. Dear Mr. TA1111; Thank you for yours of the 28th relating to the Bank of England eh were modified ables. My letter to Br. Curtis explains letter by the sorb o after dictating the extent are still more modified as the and to some tar developr iousness of tha ituation unfolds. t the responsibi- On the thole, I am now lders by a ver:; brief letter lity for this matter be sq to the Board thic irritating, but Which will will no not sent to the Bank of explain that the cab England, and that they tion with me, in which I was done right away, I deuce. it and If they want t t of the telephone conversathat unless something of that sort ed with a wilfull violation of confi- with me about it, no harm will come of will'permit the restoration of more friendly relations between and members of the Board, Which I think is a active offic most necessary'tug just now. Very sincerely yours, A. H. Treman, Hsq., Federal Reserve Dank, New York City. ;S/CC Denver, Colorado, March 4, 1917. Dear Ur. Treman: Yours of the 28th, enclosing the McDougal emission, is received. I would not be disturbed by it. He has a the answer to his proposal to mark (she° payable in He' ork exchange at current rates, is to decline to handle Should Mr. McDougal succeed in organizing a Stat --- tion of Banks to handle check4.awn on Wh say onetenth, it would si because it would concert nation Of exchange charges, all of the exc. devise, but I would no e charging banks into one shoot at. I think our best organization and gi plan is just to go right collect checks on all th business and when the time comes, by the best measures that we can masters. ery sincerely yours, R. H. Treman, Bprk, Federal Rese New York City. BS/CC tsisted in charging Denver, Colorado, March 4, 1917. Dear Mr. Treman: I was delighted to have your letter of Feb had no news directly from you for some days. r7 27th as I had You e treated to a fine no serious dnmez combination between McDougal and Fowler to your temper or ear-drums. killing his own goose. To tel the truth, I t If he wil McDougal is nue on his present course with even more violence, he thy in following; that is what befell Congressman Fowler and ect Lyford has also suffered that fate. I do not thin t I agree wi egory about deferring the extension of our Col state bankers are hesitating about putting on a The may pin or two, hey think are going to pinch. tie a after they have had them on a month Ty will forget all about them. lection I believe pass to do us that I do no damage, but The danger point in the Col- It was not in the power of the state banks was our own member banks. I am frank to say ere is a bank of any importance in the Federal Reserve System that would dare retire ender present conditions and be very foolish if we do not put an all the harness conceive of a right now. bank retiring when the country is facing war? WB will Can you This is the psychological moment - possibly the only one we will have - to get right after this /matter and I sincerely hope it is done, not through the post- masters, but just by notifying the state banks that we are going to collect checks on them, even if we have to aopoint agents in every town; they will 2. 'o - Mr. Treman. March 4, 1917. come across all right. This is the beat time also to start a country wide campaign get the State Banks in. If I were governor of the r'ederal Reserve Board I would get together a committee of the Re ;, a plan with ...ernors, them for an active campaign Congress is not going to monkey with t While this war pressure is on to prepare at once. matter of collec and While the Reserve Bo it and urging other amendment On charges s opposing -.14000/ I am glad not to be It would gratify ma day you could find the to write me a sl.cetc on of t4e bank is working and include a statement developments. ness, having to do with new I have in matters as the Clearing House relations, ppointment of foreign correspondents, statements of private other etc. London and do hope you will not ,70giceth ich detail of the really was not It is fine to s burdening yourself with a mass of the does not belong on your shoulders and which e of the legacies that I was obliged to leave behind me. the bank in such strong position. As I have frequently said, don't host ate to run along with about fifty millions invested. present rates, this will take care of our dividends, except such a At part on the old accruals, and give everybody a feeling of satisfaction that we amount to something. We are amply fortified for any reasonable strain and dividends will help grease the wheels with the country banks. Faithfully yours, BS/CC 3. Mr. Tremen. March 4, 1917. DX. Your personal letter, with admonitions as to mci behavior, etc., is a welcome addition to various contributions of this character that have recently been received. I am taking good care of myself and there really is no grounds for corn nlaint on that sc well as I do. R. H. Treman, Esq., Federal Reserve Bank, New Yor,c City. hope you do as Denver, Colorado, March 5, 1917. Dear Mr. Treman: Yours of Larch 1st regarding amendma ived. has gone over the dam and with an exhi on of leek think unmatched in bletory, our Congr has succeeded That water triotiam I disgracing the country. I don't refer simply to amendments to our par ular statute, but to the act of a few mamb S in d lative program and holding n s efforts to protect the ing a Whole legis- country. About my corr pond caption of a couple o. dent jelly I hope to see in Washington, with the ex]anged with Delano, Who eonfi- e this month, they have been mild as milk. In fact, I have bad n e with the Board to speak of for a long time, excent an hange of letters with Warburg of no part consequence. only for a Thank uld like to be able to visit Washington, if frank talk with them.. for that you say about my health; it is coming along .,111 right. Very sincerely yours, R. H. Treman, Federal Reserve Bank, New York City. BS/CC Misc. 34 P3/ RR postal 12:45 a.m, 2F,-1AL RESERVE BANK 1F NEW YORK (TO BE MAILED) CONFIRMATION OF TELEGRAM We have today telegraphed you as follows: March 5, 1917. R. H. TSAUGIA, Esq., Ithaca, New York. erything quiet Acceptance rates softer Secretary announces one hundred and fifty million one year government notes will be sold promptly public subscription Pierre Jay 8-2 Charge Fed. Res. Bank 120 Broadway -,Aniver, Colorado, Aprch 5, 1917. Dear Mr. Trernan: ACCUMULATIONS OF GOLD. -eplying to yours of the let, 1 have written IAr. Jay fully on this subject and won't repeat it now. arrangements are concluded and the ot it if our foreign My well afford to carry even $100,000 00 gold bars, bar share of our own bank alone should not exceed Don't overlook the fac Office as to charges are available by simply surre R. H. Treman, Esq., Federal Reserve Bank, New York City. BS/C in us, we could Reserve Banks ssibly the at the outset. with the Assay efactory, ol rs can be made instantly certificates. Denver, Colorado, March 5, 1917. Dear Mr. Traman 0V NT B1ID3. My best opinion just now is to awai :Aay purchases miess indeed the Board' 7u.ts before making ranouncement L regard to the us t' purchase of $15,000,000 will make it ,,. essary for us chase bonds in anticipation of tenders by member banks; as to that not up-to.-- date. It looks to me as th near future. Very truly yo R. H. Treman, Seq., Federal Reserve Bank, New York City. BS/CC ve som ge issues in the Denver, Colorado, larch 5, 1917. -- Dear Mr. Treman: Quite a budget of mail reaches me from you today, including a general letter of February 28th. Mr. Curtis resignation and I am sorry to be unable me about Mr. Cann's estions, other make any than those sent him, as to a success° We need a good redit man to work along side of Mr. Kenzel and the or officers, we need a man who has a good understandine en though at the outset he hasn't very man and break him in to d ertheless get a good ther work, pond wit, making inquiries partment. The only reliab through friends wh putting candidates thro Of course my own get final word from any and I would no activity in his own device and then, if you please, third degree. ery indefinite and must be until I t will be difficult to get to Europe 1 any matters requiring attention by me at the o or in Washington, had been dealt with to the best of my still h ng against hope that Aiken may be persuaded after ability. I all to join u Under no ideration, according to my view, should we be satis- fied with anything but a man of first quality and experience to take the office of Deputy Governor. There is no occasion to give the matter of change of altitude any consideration in making plans. There is some need need of considering the intense heat of our midsummer months in New York, combined with the humidity, and that was one reason for considering the To - Mr Traman. March 5, 1917. trip to Europe then rather than later when the weather is more favor- able. 1 do want, however, to developments and the give some time to studying our ()an office unfortunate situation regarding the Board in Washing- ton, just as soon as possible. he was an seriously, for I feel Cann's loss very experienced and competent man. Sometimes I think ng trip worth While for you or Mr. Jay to make it might be t here to discuss some of these matters. Yours of :larch 1st is also recel posal to keep ;:i100,000,000 of P I agree wit eserve notes i. ult. wish they could all be carr ew York and only n't you think that inclined to a supply of ci;600,000,000 . Locke's pro- believe it is too much. Our statemen of only ,600,000 a year; velopment of the polio we should bring our so b reasing otr shown earnings at the rate e seriously impaired by further deFederal Reserve notes. Don't you think aunt up to at least S50,000,000 and do of bills? Very sincerely yours, R. H. Treman, q., 3ank, Federal Rose New York City. Denver, Colorado, March 5, 1917. Dear Mr. Treman: OF EUGLAND. The enclosed let It roc:Ares no acknowa R. H. Treman, Federal Reserve Ix Dew York City. Lord Ounliffe. be in the aarik's files. Denver, Colorado, March 5, 1917. Dear Mr. Treman: Referring to my recent letter about the Philippine National Bank, I have just received a note from Dr. of a letter addressed to the Federal R Bank of in Which he tells re a copy has also enclose copy of Dr. Willis' letter and sent to our o f my reply, bee lustrates the desirability of promptly arrangements of a MRD of sufficient oxpor deal of detail that :nclosing a copy erienced character a Bsice Encs. - 2. c I e this il- to take up of course, it will need rest of us of a zood he Senior officers. yours, H. Treman, Esq., ?ederal Reserve Bank, Few York City. Francisco, Denver, Colorado, March 6, 1917. Dear Mr. Treman: ttero%o Thank you for your hand writ I will add my vote to the others as 1 sincerely hope that Mr. Jay and M of heart as to other members believe have been much o I hate to impo 11 A BS/CC organization, 1ong hand lette V Federal Reserve 3 New YorK City. Curtis will ha e, but a charge I verily orked. that this is the last. R. H. Tx...9212au, ESN. o the proposed eh 2nd. incerely on you and trust Denver, Colorado, March 7, 1917. Dear Mr. Traman: Aiken and I have finally arrang to meet in Chic so I am telegraphing you as per enclos d confirmation, may be right up to date in my at the office. Will advis R. H. Truman, Esq., Federal Reserve Bank, New York City. as to oi.ha on Monday order that I s transpired the r salt of our meeting. TE TEL OF SERVICE DESIRED Fast Day Message Day Letter UNItoN WESTERN UNION' Night Message Night Letter Patrons should mark an X opposite the class of service desired; OTHERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. AM NEWCOMB CARLTON, PRESIDfiNT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to ranver, Colorado, _arch 7, 1917. R. H. Treman, Pedoralnboorve Bank, '1 York City. Am leaving Saturday to meet Aiken Chicago on Lionday. any eua;oetione you trave. Benjamin Strong. Chg. Benj. Stron6, 4100 Uontviciv 31v. 7e1ograph 1111rMIMEIP/WINVAT,' EGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO THE FOLLOWING TERMS: A mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for comparison. For this, d telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FOR AS SUCH, eof it is agreed between the sender of the telegram and this Company as follows: .ny shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEAED telegram, beyond the amount 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 unless specially valued; nor in any case f or delays arising from unavoidable interruption in the working of its lines; nor for errors in cipher or obscure ent 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 .genes 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 he time the telegram is offered to the Company for transmission, and an additional sum paid or agreed to ba paid based on such value equal to one-tenth of npany is hereby made the am,t of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to reach its ms 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 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 for such delivery at a reasonable price. sponsibility 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 company's messengers, he acts for that purpose as the. agent of the sender. 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 Company for transmission. ia/ 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 CMS. THE WESTERN UN ION TELEGRAPH COMPANY employee of the Company is authorized to vary the foregoing. INCORPORATED NEWCOMB CARLTON. PRESIDENT CLASSES OF SERVICE Letter shall be delivered on the day of its date absolutely and at all Letter W MESSAGES 11-r ate expedited service. IT MESSAGES ;ept !cl up to 2.00 A.M. at reduced rates to be sent during the night leliv wed not earlier than the inorning of the ensuing business day. LE TTERS defe wed day service at rates lower than the standard day mes- e rate s as follows: One and one-half times the standard Night ,ter ra Le for the transmission of 50 words or less and one-fifth of initial rate for each additional 10 words or less. SPECIAL TERMS APPLYING TO DAY LETTERS: n further consideration of the reduced rate for this special "Day ter" service, the following special terms in addition to those enu- 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 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. -ated above are hereby agreed to: Day Letters may be forwarded by the Telegraph Company as a rred service and the transmission and delivery of such Day Letters in all respects, subordinate to the priority of transmission and SPECIAL TERMS APPLYING TO NIGHT LETTERS: . very of regular telegrams. . Day Letters shall be written in plain English. ot permissible. . Code language This Day Letter may be delivered by the Telegraph Company eleph ming the same to the addressee, and such delivery shall be a plete discharge of the obligation of the Telegraph Company to ver. This Day Letter is received subject to the express understandand agreement that the Company does not undertake that a Day In further consideration of the reduced rate for this special "Night 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. r Denver, Colorado, March 8, 1917. Dear Mr. Treman: Your telegram of today is just receiv ads as follows: "Curtis absent today. Think yo urpose of oundersto telegram yesterday stop. Tuestio s shall we in t words quote "ear-marked or" end quote word shipped in st sentence paragraph 12-(e) to correspond h similar provi ns paragraph 11-(d). Please wire. To this I am replying as I am very sorry to misund.ersto that that telegram eae j ment and, as they hav to enclosed. I was leavi b telephoned out to reply to it withou , whether you are doint tam].so. all. Very sincerely, BS/CC Enc. om the City, I was obliged ther conditions permit you to try a little golf now and t ank, to keep a dentist's aopoint- or and in the interest of your health and .;eneral behavior, I R. H. Trzap, Federal Reserve New York City. The fact is of me; the drinks are on me. We are having bully Bee' wire. it? I eer- Receiver's No. by Letter Check Night Message NigM Patrons should mark an X opposite the class of service desired; OTHERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. Time Filed NEWCOMB CARLTON, PRESIDENT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to Denver, Colorado, March 8, 1917. R. H. Premark, rodoral Loserve Banc, Bow Yort City, P. Y. Would oortainly insov words mentionod in paragraph ,. Stop. Undoubtedly amiAod by oversidht. Benjamin Strong. Chg. Benj. Strong, 41)0 Montview Blv., Denver, Colo. 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 comparisor. For this, ne-half the unrepeated telegram rate is charged in addition.. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID FO% AS SUCH, 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, beyoi.- the amount :ceived f or sending the same; nor for mistakes or delays in the transmission or delivery, or for non-delivery, of any REPEATED telegram, beyond fiftytimes the sum received n. 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 legram s. 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 lused 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 riting 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 ae per cent. thereof. The Company is hereby made the aaont of the sender, without liability, to forward this telegram over the lines of any other Company when necessary to reach its :stination. 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 woo. 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 ntract for him for such delivery at a reasonable price. No responsibility attaches to this Compaxy concerning telegrams until the same are accepted at one of its transmitting offices; and if a telegram is sent to such office 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 :c1 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. S. No employee of the Company is authorized to vary the foregoing. THE WESTERN UNION TELEGRAPH COMPANY INCORPORATED NEWCOMB CARLTON, PRESIDENT CLASSES OF SERVICE ST DAY MESSAGES full-rate expedited service. HT MESSAGES .ccepted up to 2.00 A.m. at reduced rates to be sent during the night delivered not earlier than the morning of the ensuing business day. y LETTERS deferred day service at rates lower than the standard day mesrates as follows: One and one-half times the standard Night er rate for the transmission of 50 words or less and one-fifth of initial rate for each additional 10 words or less. SPECIAL TERMS APPLYING TO DAY LETTERS: further consideration of the reduced rate for this special "Day H." service, the following special terms in addition to those enu- ted above are hereby agreed to: Day Letters may be forwarded by the Telegraph Company as a red service and the transmission and delivery of such Day Letters 1 Letter shall be delivered, on the day of its date absolutely and at-a/1 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 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: all respects, subordinate to the priority of transmission and In further consideration of the reduced rate for this special "Night Letter" service, the following special terms in addition to those Day Letters shall be written in plain English. Night Letters may at the option of the Telegraph Company be mailed at destination to the addressees, and the Company shall zy of regular telegrams Code language permissible. This Day Letter may be delivered by the Telegraph Company ephoning the same to the addressee, arid such delivery shall be a ete discharge of the obligation of the Telegraph Company to This Day Letter is received subject to the express understandd agreement that the Company does not undertake that a Day enumerated above are hereby agreed to: 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. Denver, Colorado, March 8, 1917. Dear Mr. Treman: With this I am enclosing a draft of a letter addressed to the attempt in order Banco de la Radon Argentina, Which is si that you and the others may study it ov of sending it in this or some modifie and decide a the visdem Orlit. This is neculiarly a matter in mh ch we should sem underine and his natural standing with Mr. Warburg bee acquaintance with this vhol e, therefore, addressed a letter to him, of which I copy, and await further ad- vices from you as to h Please have it members of the Reserve Board tha should extend the scope of our operations are disposed to believe in South America over fied and it is exceed/ under tug, that our p ield than I believe is vise or justi, therefore, in order to avoid mis- nary discussions with the Board should cover fully and remove all possible ground for misurder- all of thes standings. Ii wid 2 e se see my letter of January 26th on this subject. Very sincerely yours, R. H. Tremor, a.q., Federal Reserve Bank, New York City. BS/CC Dies. Denver, Colorado, March 9, 1917. Dear Mr. Treman: Some of my telegrams from the office some by Postal. I have made an arrange$ -estern Union and with the v,'ern Union Company here which facilitates prompt delivery if messages and b mand ieve it would be better if all of my wires are sent 'bs that Company. I an leaving tomorrow king foraard to a visit with Aiken and The statement of th bank just recei wonderfully strong p sitio 000 of gold tucked away and $228,000,000 of I fully believe that we certainly exhibits a total of .g70,000,000, and rd to build our investment account no a bit in consequence. The question ing /y arise as to our attitude in buy- ort goVernmen of the bo bills run for more than three months, would certai ment obli s and I have no information as to the terms tio government bil be disposed to buy acceptances rather than these govern- unless there is some real necessity for our taking the or the government's benefit. Very sincerely yours, R. H. Treman, Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, March 15, 1917. Dear Mr. Treman: FOREL GN BANKING CONN TI Replying to yours of the 8th, mi in these matters has been made some we move ahead ut of deference views of the members of the Res a letter from him which reac we ought to at least start inquiri to him explaining Why I wrote 1.1r. Jay in reply to go New York BS/CC explaining why I thow;ht no, will ask you to read my letter tin 0. this subject. ours, R. H. Treman, Esq., Federal Res the apparent Denver, Colorado, March 15, 1917. Dear Mr. Treman: FOREIGN BANKING CONNEZTIONS. Replying to yours of the 8th, my ut of deference in these matters has been made some go, explaining Why I thought a letter from him which reac nd will ask you to read mq letter we ought to at least start inquirl R. H. Treman, Esq., Federal Res New York BS1CC the apparent I wrote Mx. Jay in reply to views of the members of the Res to him explaining Why we move ahead tin this subject. Denver, Colorado, March 15, 1917. Dear Mr. Treman: FEDERAL RESERVE EX I had a talk with Aiken, as well as LieDougal a%iay, on this subject and suggested a cour some assistance. You doubtle get a situtation intelligently n which I hope 11 be of difficult it really is to s complicated as this one after so long an absence This is no ti see the wisdom of ad. 1 hope the Board will ucing new machinery, the working of whic'a will be d ncerely yours, R. H. Fedora New Yo BS/CC zon, Esq.,. °serve &Ink', City. Denver, Colorado, March 15, 1917. Dear Mr. Treman: Bank of England. The enclosed letter has just reached me from Montague Norman and I am not replying to it until you and t to read it and return it to me. It wi have had opportunity xplain the sent somewhat and emphasize what I have a long apprehend probable necessity for a further treat nt of this subj correspondents On the grovala, reading kindly ret as I will not ans situation that is the t of our foreign the letter after comments from you and the others. Referring to the se personally man's letter, I wrote him and priva the Board in ,ashington a nation of the announcement of possible under the a nay, I believe, as parent breach hardl under a his associate was briefly to the of the motives of the pressure and I was so far away, and would look at the matter in effect that it would Board,when Pederal-nierve Bank, New Yor: City. BS/CC Enc. they were I felt sure that he and the same way that I had. Very sincerely yours, R. H. .,2reman, Esq., such sible criticism of the Board for an an of conf fair for me circumstances and in Denver, Colorado, March 15, 1917. Dear Mr. Treman: Yours of the 6th but it contained no regarding statements of conditions is received, enclosure. Separately I received a statement in new orandum in Mrs. form as of the close of business Februar of "Larch McLarents handwriting that it was omit but I seem to have no letter of Iffarch The statement referred to 3d, on that subjec urned herewith make the fol- lowing comments: 1. Please consider able to separate that is held in New York la thinK we could consolidate two actounts LI this 2. Might it not in may gold It is physically available in New York with s the the one item? .441 o show commercial oaper and It wil ising the extent to which member banks discounting w or unea . c sometimes might dive rise to discussion I realize that various ba stirs up pub Inv acceptances these seoarato items are available in and the bulletin, but it is the daily press that comment. ments. I am inclined to think that these are stated in the best form, so long as our ownership of government bonds is so moderate. The question is will the item in as may be the case, we The word this form always be satisfactory, when, get loaded up with "Reserve" which I have governments. marked strikes me as blind and that it will not be understood; in fact, i do not understand it myself. 2. March 15, 1917. To - Mr. Treman. The Words "and lawful money" give the impression that silver certificates and green backs are held behind our note issue, which is not the case. Might this not be omitted entirely or changed in some way so as to indicate that we simply hold There might be some advantage side the items °Profit and Loss" and from the total the item of "Current golds the liabilities ombin rent Earnings ense" on -end deducting roes side, so the roe that we would have but one item among the liabilities somewhat as follows: "Prof Cur . ich would read r'nings (less current ' expense)". 7. In this connect consider in advanc we shall show the two o r. Jefferson be asked to deriez the question of how oks when we commence to buy foreign exchange and 13. , according to my view, imnortant that our statement Should too much information as to our actual opera ions and 1 woul after o have Mr. Jefferson write ma his views s gone into the subject. It will undoubtedly be necessary and desirab lInderstanding with Washington in advance on this point. Very sincerely yours, R. H. Tt2alan, Log., Federal Reserve Bank, New York City. BS/CC C4orado 1.1; 4.4.1.1i4U DEPT. Denver, March ifl OFC PERS MAL. FED.RRAL .14r:=.,7,1161 nANit Dear Mr. Treman: let me thank you This is in renly to yours of the 9 there awaiting for sending me copies of letters to Ca aago, which we my arrival. This is my report about e interview with There are I believe reasons which he believes ar will prevent his coming to N n t I en: compelling that uture. I am not outweigh inducements that definitely satisfied that r me to return, or to take might be apparent, if it up mu work permane e definitely opinion in my own ml etter net to formed the make any final change in the office of in this regard until I have a chance to talk it over with hers. before, possibly it would be feasible my coming to New Yor have a meeting n Chicago. for u Jay leavi a even on Mond en This could be done by you and Mr. on a Yriday and returning say on Sunday or if you could both arrange to be away. I am gr tly disappointed could not urge If this cannot be arranged by that Aiken cannot come to New York, but im in the face of his very definite views. Now in regard to the suggestion about Shifting Mr. Jay, would you mind writing me just what the situation is whom the suggestion was made and in regard to that plan, by whether,r. Jay knows about it and feels that it is either desirable for the batik or in his own interest. I do 2. To - Mr. Treman. March 15, 1917. not want to exoress an opinion about that move without hearing particu- lars. If this delay in a decision is satisfactory to you and the others, it will not be necessary to consider another man of the type you suggest for the present. I am more than satisfied that 1 s important t t i should make that trip to Europe this summer, if i is at all possib to cross the ocean and that, of course, effects my plans. I am wr rig separately on that subject. H. T,.eman, Esq. Federal Reserve Bank New York City, N. Y. R Denver, Colorado, March 16, 1917. Dear Mr. Treman of your recent let- I have not written you in reply to that pt ter written by hand Which related to my expense, ut here, as I wanted to think it over. After doing so, it seems to mi hat it is a matter in New York. Which should be considered by the off a i would be bank is no Such worl: as I an doing out here or not, s connected with the be willing and glad to do any way d of the bank than my own record and I am much more anxious s than I am to excape expense. should be untmoeccable in those and the only other expenses Miss Carlton re one m ssages, for Which the bank has incurred are for t d stationery Which is not worth reimbursed me re discussing. Mi to sa ariton give requently Satu ted to purely oe is d It s been in and the othe 11 day to her work, ays and Sundays, but of course a part of her time nal correspondence of ng aan. ind to write you for sometime, asRing that you der Whether at the proper to again discuss the subject of mg own salary. cerning which I think any suggestion mo. including I am sorry time it may not be necessary These are not matters con- or recommendation should be made by It is much better that the officers of the bank Who are on duty de- cide them and you know without my saying so that any arrangement Which you make will be entirely agreeable and satisfactory to me. The thing that troubles me the most is your own position. I know 2. To - Mr. Treman. March 16, 1917. What a sacrifice it must have meant to you to have your own business and all of your home arrangements so terribly disarranged as has been necessary by your act of devotion in takingti relieve you just as much as possible an work. is no 3f I want to part of the incentive for no to get well quickly. o won't you and sour associates please decide these matters without as ng me to make eerely yours R. H. Tian, Esq., Pederar-Reserve 3 New York City. suggestion? Denver, Colorado, March 17, 1917. Dear Mr. :ppeen: Thanks for yours of the 13th. I found q returning from a bit of mail on Chicago and possibly in my haste o catch up 1 did not write you as fully of my Chicago visit as I sho have done. Aiken and we at once was at the hotel awaiting my arrival went into executive session, disct particularly "-'tter of his coming to New York. He explal he circumstances in detail and while I do not think hi be considered as final as to the future, I ai satisfied that join our staff in th I not be possible for him to am also satisfied that it would be unwise fo a during which he c f the bank This, of course, w summe safe you ar request f while I am there. question if there was no prospect but I fee hat I think th of my r er a period of some months, It 'bothers m ng and t ve now of being able to get back this conclusion stated in my last letter is the only good deal to realize what a great sacrifice this involves your oontinuing to do so at my nths' longer. One consolation that I get out of it, but a thoroughly selfish one, is the knowledge that the bank hands and the further knowledge that at is in good least one of our directors has had opportunity to himself exeerience the many difficulties involved in starting a brand new thing and adjusting all the porsona/ equations to a satisfactory working basis. Even when I get back, when questions of importance arise, you can always count on my looking to you for an 11111.1111 2. To - Mr. Treman. Earch 17, 1917. experienced aopreciation of the "domestic" as well as the "foreign" situation. Sunday evening McDougal joined us for d enjoyable evening. and we had a most Monday morning Aiken and I nt in going over a good mnny matters, concerning which he will make report to you. The principal one was, of course, our re atione w have pointed out to him, and I portunity aho wise to point out to some o have been made and no doubt other knowledge. 40111 and upbuildin and, 1 ording to my vi importance t -4.. :. i develops, there the Board has ever realized cal development of the System in its has been due to the devotion of the Governors, , their loyalty and cooperation all branches of tisfacti made of which I have no dissatisfaction I d' eat extent machin spirit bee unhappiness us. will be a the various Reserve Banks, miler offers If ge Reserve Banks dgo of attractive offers that enior : might be a 74gral to what f the I have personal to se e made like- the Board privately that shaking a big stick over th losing policy. he Reserve Board. :Ind a general the System is of much Greater vain-glorious effort by the Board to demonstrate or establish its authority. Along this line I think you will find Aiken fully posted after our talk. What you say about golf disappoints me. I have just been elected a non-resident member of the Country Club here and wish you could get out and start me off at the game again. moderates, i expect to play When the weather but then no one realizes better than I do that your peace of 3. To - Mr. Treman. March 17, 1917. mind depends on being on hand. My absence has done much to upset my neace of mind during these unsettled times, so I am an anpreciative sufferer. Continuing about the Chicago meting, Aik Reserve Banc in Chicago on Monday and had lunch apd Heath. We had a nice talk and I t by general apoearances, my looks and behavior. to get evidence of health. Aiken an and early Eunddigy friends. R. R. Federa New Yor eman, Esq., °serve Bank., ty. visited the hotel and had a and that evening I by Mr. Palmer, who happened in I th McDougal, Meliay Afterwards Aiken and 1 ret further session together ment and was ove ad to be joined erve Bank after had left. who can measure my improveou an encouraging report as to great pleasure to see him and me in such apparent good most of the evening, with Palmer, ek to Denver with some Denver Denver, Colorado, Larch 19, 1917. Dear Mr. Treman: I have yours of the 14th regarding the Dir, tors' at the same time that one arrives from Warburg, i both of which it o see the bank anpears that I am in a distinct minori t dividends. earning enough at least to pay its esire to keen past has been more consistent dollars in our inv ing dividend and n r re °mails, the Whole system is it was and the tment the bank ent from what it was a year or that our siLuation is materially vastly stronger t' y in the t I think we can all now agree liquid and be neepared for a year and a half ago Meeting of ten or fifteen million h is the difference between earn- account, earning ce them 11 not impair our ability to meet a particle, so I still urge that throug, u.derate purcha millio or thereabouts not well s we get our investment account up to fifty if possible. ount on chickens before they are hatched, but I am very cö4mb,and now believe that Warburg and his associates are also, that when Congress meets the amendment to the note provisions of the Federal Reserve Act will be promptly adopted, which will add over $150,000,000 of gold to our reserve and will make the Federal Reserve Bank of New York the strongest central bank that has ever existed in the history of banking. We will have a gold reserve of at least 90%. If 2. To March 19, 1917. Mr. Treman. the amendment to the reserve provisions is also passed, 1 figure it will add a trifle over $100,000,000 to our go uive the Federal Reserve Bank of New York a tot reserve and will of about175,000,000.: of cash, practically all gold. Without counting to our strength, this huge addition resources upon except, of course, which we may figure slightly in emergency situations, is no excuse whatever for our no I agree with you that a warrants; in fact, as you know, only exception that 1 When they want money R. H. Trer. Federal New Yor BS/CC rve Bank, ity. el that there r full divide norease our holdings of d this for sometime pant, the purchases from member banks Denver, Colorado, March 19, 1917. Dear Mr. Treman: I have just read Mr. Kenzelts memorandum to governments. March 9th in regard The chances are that from now o long period the Reserve banks will hav possibly for a losses on bonds which they buy as a result of tenders by the tory price of -oar. I suppose we and being hung Ar) so to speak suiting. 31s at a loss in order think I would prefer to will take them. H the statu- the choice of notes or selling the retying up too much money. Federa New Y BS/CC n Esq.,. lescrve Bank, City. I id to the extent that the market on this score? cerely yours, R. H. 1 onverting Denver, Colorado, Larch 22, 1917. Dear 1.1r. Treman: =117,1 Montagu Norman has sent me copy of Cunliff 2nd and with a inemoranduLi enclosed ng Which I wrote ther At the same time he sent me the ono Curtis yesterday. an Eaglish publication contain' page from from an artic u Which was recently printed in the jour can Bankers Association. I did not see the article nor do journal out here regularly, but it has resulted in s e comment abroad because it portrays such dense c. and conditions. interest of a bette ese Sditor of t attenti writes of the facts ay that the Ba ho shoul' ;xplain vihat h with our friend the 1 do not recall, and draw his lioa o 00me In the matters, it might be a good ential talk e plan to have a very letter of March regarding British finance. Ghen a man f England is not a Government institution, ans. When he says tnat it has avoided al- e of his facts. And when he says that war liances, he financing has not been done through the Bank of England, he portrays such stupid ignokance that he subjects the Whole banking committey to criticism. Almost every either itself statement in the quoted part of inaccurate or so incomplete as to portray all of inaccuracy, and if we could arrange ing article the article is the faults published in the journal in to have a discreet but illuminat- regard to this matter, it might 2. To - Mr. Treman. March 22, 1917. be a good thing. I would be glad to write it if could be published without my name appearing. Very sincerely yo R. H. Treman, Federal Reserve Bank, Few York Oity. , Denver, Colorado, March 26, 1917. Dear Mx. Tregnn: 1 judge from your letter that you have received a copy of Mx. Irburgis letter of March 19th, addressed to me on the subject of the proposed arrangement with the 3anco de la Nacion Argentina. i am en- closing copy of my reply as the best means of answering the specific statements contained in his letter, which I hope you and the others will consider before finally determining the form of letter to be sent. Unfortunately, Ea:. Warburg and I have never seemed to agree in regard to some features of these foreign accounts. In these matters please bear in mind, however, that the actual business is to be conducted by the Federal Reserve sank of New York, under the supervision of the Federal Reserve Board, and I think we must apply our own convictions to these matters and not be unduly influenced by the views of any one member of the Reserve Board. Yours very truly, - -. H. Treman, Esq., Federal Reserve Bank, New York City. 13s/cc Denver, Colorado Larch 26, 1917, 'if prterf7ILL\i_ , PIIMS3NAL. A. " Dear Mr. Treman: 1 0 14 41? I % rgPrre Yours of the 20th reached me just as Lir. Delano , ';'t as leaving. He will be in New York shortly and will report to you just exactly what Dr. Sewall that it will told him in regard to my prospects and I hope satisfactory. be reassuring and Meantime, I hope it won't be necessary for inc to make too or definite plans about either going to Europe in the Adirondacks -- this can be determined spending a part of the summer better after I return. The suggestion about Mr. jay I think by all means should not be mentioned to him. I have discussed all of these office matters very fully with Mr. Delano and he will explain to you better than I can by mail just What my own views are. My visit with Mr. Delano was we delightful. He arrived Thursday noon and spent Thursday afternoon and evening together in continuous session, as well as Friday morning.. Priday nooa we had luncheon at the University Club with the officers of the Denver National banks. In the afternoon WO saw Dr. Semnil and in the evening Mr. and Mrs. 'Welborn, old friends of his, dined here. That night Delano, .;elborn and I went to Pueblo in Mr. Welborn's private car and Saturday went through the Colorado Fuel & Iron Co's plant there. Welborn is President of that Company. gr. Saturday evening we dined at the Country Club and I saw gr. Delano off for Dallas on t-ie night train. I wish very much that I could have opportunity for a chat with you such as I have had with Delano; I know it would be productive of good. not have it before the first of June, you may be sure we will then. If we can- Faithfully yours, Denver, Colorado, March 26, 1916. Dear Lr. Treman: r copy of the Llany thanKs for yours of Liarc% klst, ancl I am writing you se Executive Conmittee idinutes. Banco de la Nacion Argentina matter, to our °op ra.ely regarding the les straight. - it is not About the sale of the United States one-year n view of our obligation to t that in I have always an important matter one way or the repur t would be better to keep more completely and likewise them, thereby showing our actu ;min to such proportions making the earning. Our reserves t this amounts to) borrowing money at 2- that seems to be an unusual proce have in viev(f factoril our ,strong c su,zestlan about this is no evidence o t Iv opinion holdings of the bills our earnings impaired rather unnecessarily educed too -rap bee made th so that our too it has been In ow the wa:1 I feel. About our acc ition. I am also sorry that Governor Harding ur rate for bills. It has worked very satis- nd changes are really to be deplored when necessity for it. objections to the there change are as follows: First, with a maximum rate of 2;; we have enough latitude so that frequent changes are avoided. When the difference between maxim= and minimum is reduced by curtailed and we are raisin,_, dependent will be forced upon us when the minimum, upon our latitude is necessarily approval of changes of rate, which rates decline. In other words, the Board 2. To - Mr. Treman. in Washington can - March 26, 1917. restrict our activities by declining to reduce the rate. The second objection applies to the mforimum rate which never should have been established. If the maximum The rate should be a minimum rate only. rate is designed to are so bad in quality that they prevent the .purchase of bills that bring more than 4, method is an unsound one because it is exercised not based upon knowledge of the credit of discount, then that a method which is acceptors and endorsers. If it is designed to restrict the quantity of bills purchased, it would operate against all bills good or bad whenever the market advanced sharply and, of course, at just the time when we should be discounting freely and should not have such restrictions imposed upon us. 1 would like to sec this matter held up until my return, if possible. The rate has worked all right for nearly two years and don't see the force of any argument for its change. Th expenses. executive coundttee is very considerate in regard to mg t am enclosing a memo. of one- alf of Miss Carlton's sation since she has been with me, if you and the others satisfied that the bank are compen- thoroughly should pay that proportion. I am glad that the additional space is being taken for the bank. Best regards to you and the others. Very sincerely yours, R. H. Trerna,..., Federal -RiTserve Bank, New York City. BB/CC Eac. Denver, Colorado, March 27, 1917. Dear Mr. Treman: I have yours of the 26th, returning* Monta6u Norman's letter. You will appreciate from reading it the character of the friendly relations which we will have no difficulty in establishing with the Baru( of England and it seems appropriate to say that our action in approaching them as we did a year age, at a time When things looked rather black, was the means of establishing a basis of relationship that could have been developed in no othar way, hence my anxiety to take advantage of it. Very sincerely yours, R. H. rilman, Federal "oserve Bank, New York City. :bS/CC Denver, Colorad.o, March 27, 1917. Dear Mr. Treman: Referring to your report that the Liberty National Bank is now authorized to settle their Clearing House balances, let me draw your attention to one matter you. iu this connection which may not have occurred to There are doubtless other bans in the Clearing House which would be glad to mai:e the same arrangements as the Liberty and the Corn Exchange. If those banks that like the plan are permitted to employ it, the consequences may be: (1) .(2) That the pressure which would be exerted by those members to make the plan universal will be lost. That our balances may awing unduly one way or another, because acting for only a few banks we would not get the benefit of both the credit and the debit balances and, consequently, an average. -!Iis is just a suggestion for your consideration. Very truly yours, R. H. Treman, 2sq., Federal Reserve Bank, New York City. BS/CC 4 Denver, Colorado, March 27, 1917. "T!Pr:4. PERSONAL. ls.4iort Dear Mr. Treman: Your hand-written letter by my other letter of 1,11V1"- argjilitiah zzno. is really fully answered this date. The suggestion as to Mr. Jay to which MI refer would not be in Mr. Jay's interest nor in the interest of the bank. If the matter had developed to the point Where he was aware of any such plan, I would not hesitate to either write him or, preferably, have a talk with him, and believe I could convince him of that fact. Should any one be disposed to press this matter before my return, you are authorized to repeat this as being my opinion, but neither Ir. Jay nor the bank would benefit by such an arrangement. All these matters, of course, make me keen to get back but feel that the status quo if preserved until June is really all that I need. am delighted by the arrangement for Mrs. idcLaren's salary and as to the adjustment of Miss Canton's salary, anything is agreeable to me; in fact it would be entirely agreeable for me to pay it all. Won't you say to Er. Palmer When you see him that I enjoyed having a visit with him tremendously; it was really an unexpected treat. Now, as to your own work feel that you at the bank. have just been there trying. It is all wrong for you to 18 a matter of fact, your ad- ministration has been over the most difficult period possible and under the most trying circumstances and at a great sacrifice to yourself. I will never cease to be grateful and hope some day in some way to be able to show 2. To - Mr. Treman. Larch 27, 1917. my appreciation. Many thanks and very warm thanks for all that you write me and all that you have done. Faithfully yours, R. H. Treman, Esq., New York City. BS/CC vitt r""4.-.4A I, oto* wttC r aiu Copy March 27, 1917. Mr. R. H. Treman, Deputy Governor, ederal Reserve Bank of New York, New York, N. Y. Dear Mr. Treman: On the 23rd instant I acknowledged your letter of March 21, in which you made inquiry concerning Mr. R. S. Hecht, and told you of my intention of inTliring with a view to securing in your behalf such information as I understood you desired. From your letter it was evident that you were under the impression that Mr. Hecht had at one time been with the First National Bank of Chicago. Inuiry here, however, discloses I have learned that Mr. that you were evidently misinformed. R. S. Hecht, now Vice-President of the Hibernian Trust Company of New Orleans, was for a number of years in the employ of the It is quite a number of Comlarcial National Bank of this city. years since Mr. Hecht left Chicago, but officers of the Continental & Commercial National Bank, who were formerly with the Commercial National Bank of Cicago, tell me that Mr. Hecht occupied a clerical position in the Foreign Exchange Department of the bank and that he was 4 young man of good ability. Another banker who knows Mr. Hecht speaks well of his ability, although I am not able to get any up-:lo-date information suChaas I know you must be I regret very much my inability to do so. seeking. Very truly yours, Governor. Denver, Colorado, March 31, 1917. Dear Mr. Treman: Yours of the 27th is just received. 1 have known of Hgeht rather slightly and have had the improsrion that he has been a very active American Bankers Association man. but really do not know enough about him to form a vex.' positive opinion one way or another. It rill not be difficult to get Information from 1;:r. Kent of the Bankers Trust Comnany, who I believe knows him very well. . I wish I could make up my mind that we could afford to promote one of Vie Junior officers, provided of course we definitely accepted the nece:-eity later on of getting the organization, in case I were obliged to give up. toll you very frankly about outside of a permanent Governor Hecht, if you think it ;ienty will undoubtedly desirable to pursue the matter further, and I would like to hear what he says. In connection with the Governors' Conference, the matter of sold I suggest discussing bars as some of the other banks ma 7 want to join with us in accumulating bars. their participation in It will be a natural arrangement on any foreign account of business that we undertake. also be a good plan to remind the Governors that this is a _,00d pursue the policy It might time to energetically of accumulating gold, oven at some sacrifice of earnings. I have no doubt that Congress will pass the amendments to the note provisions of the Act as one of the preparedness immensely strengthening our position and we ought Of course consideration will be given to Seattle failures, measures, thereby to take advantage of it. the situation growing out of the where it seems to me some obvious lessons can be learned 2. To - Mr. Treman. !:iarch 31, 1917. by all narties. After some delightful summer weather, we had a fall of snow last night and today it is cold and disagreeable, Allah puts a stop for the present to my :tlolf. I hone you have a most sucoeseful meeting in Washington. Best regards to you all. VaithfUlly yours, R. H. Treman, Esq., Veo.eral Reserve Banc, New York City, N. Y. BS/CC - Denver, Colorado, March 31, 1917. Dear iir. Treman: Yours of the 27th is just received and I am amazed to learn that the article in the Journal was written by an ing1ish Banker. It is most misleading and inaccurate. 1 will try and prepare a paragraph and send it to you but, of course, care must be exercised that it should not be known es having come from the bank or from me. Thank you for makinb the inquiry and setting Welton straight. ( B. H. T4eugAn, bsq., Federal Reserve Rank, New York City. Very sincerely yours, Form 1 DESIRED .esmgo .cer IN ESTE i/SaNA UNION Message Night Letter strons should mark an X opposite the class of service desired; THE TELEGRAM WILL BE TRANSMITTED AS A , FAST DAY MESSAGE. LOTHERWISE E Receiver's No ViESTERN UNION Check WNW, AV TEL :PI AM NEWCOMB CARLTON, PRESIDENT GEORGE W. E. ATKINS. VICE-PRESIDENT BELVIDERE BROOKS. VICE-PRESIDENT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to Denver, Colo., April - R. H. Treman, Federal rffdrve Bank, New York City. Telegram received. Am delighted at change reported and hope you are successful in placing the whole issue and more. Strong. 41110 Time Filed ..L TELEGRAMS TAKEN BY THIS COMPANY ARE SUBJECT TO ltrIE FOLLOWING TL uard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for comps/. unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID Ft., Ilion whereof it is agreed between the sender of the telegram and this Company as follows: he Company shall not be liable for mistakes or delays in the transmission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond 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 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 o. 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, he 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 i. ,on 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 t. thereof. he Company is hereby made the agent of the sender, without liability, to forward this telegram over the lines of any other Company when necessnry to reach its elegrams will be delivered free within one-half mile of the Company's office in t6wns of 5,000 population or less, and within one mile of such office in other cities or yond 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 him for such delivery at a reasonable price. o 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 he Company's messengers, he acts for that purpose as the agent of the sender. he 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 se Company for transmission. _ mcial 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 r 'o terms. employee of the Company is authorized to vary the foregoing. THE WESTERN UNION TELEGRAPH COMPANY INCORPORATED NEWCOMB CARLTON, PRES:DENT CLASSES OF SERVICE kY MESSAGES ate expedited service. ME.<SAGES up to 2.00 A.M. at reduced rates to be sent during the night red not earlier than the, morning of the ensuing business day. TERS rod day service at rates lower than the standard day mesas follows: One and one-half times the standard Night e for the transmission of 50 words or less and one-fifth of rate for each additional 10 words or less. SPECIAL TERMS APPLYING TO DAY LETTERS: her consideration of the reduced rate for this special "Day ervic,e, the following special terms in addition to those enu- bove are hereby agreed to: 7 Letters may be forwarded by the Telegraph Company as a ervice and the transmission and delivery of such Day Letters respects, subordinate to the priority of transmission and [ regular telegrams. 7 Letters shall be written in plain English. Code language nissible. 3 Day Letter may be delivered by the Telegraph Company ming the same to the addressee, and such delivery shall be a discharge of the obligation of the Telegraph Company to s Day Letter is received subject to the express understandgreement that the Company does not undertake that a Day 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 reg ular telegrams under the conditions named above. No employee of the Company is authorized to vary the foregoing. NIGHT LETTERS Accepted up to midnight for delivery on the morning of -tile next ensuing business day, at rates still lower than standard night -message rates, as follows: The standard day rate for 10 words shall bb eharggd 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.ifords 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.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 ii to delivery by mailing such Night Letters at destination, postage prepaid. Night Letters shall be written M plain English. Code language is not permissible. No employee of the Company is authorized to vary the foregoing. Denver, Colorado, April 2, 1917. Dea r Ur. Tronan: I am just advisiag Colonel Farnsworth of my iaabilitj to attend. the Sprin,-; meetinc; of the Executive Council, INA I hope that some one from the Bank can be there as this year we will need representat- tion without fail. V Very sincerely lours; L-wivur, Colorado, April 2, 1917. Dear Mr. Treman: Lnclosed is a rather hastily dictated article which you justified in turning over to Welton. may feel It is, of course, highly important that the source of the article be carefully preserved in confidence which I am sure you can arrange with him without difficulty. If, for any reason, the article does not strie you as being a wise one, do not hesitate to tone it down. I am so much out of touch with What is going on just now that it is a little difficult to judge what is the best character to give it. Very sincerely yours, R. H. Tan, Lsq., FederarResarve Bank, New York City, N. Y. BS/3C &Lc. The article appearing in our January nudeer, entitled "Eater the Bank of England" has brought a request from some of our readers to amplify the statements it contained, which it is claimed were misleading as to the operations of the Bank of England during war times, owing to the brevity of the article. Inquiry has been made respecting the relations proposed between the Bank of England and the Federal Reserve Bank of Ilea York, as well as the ac- tivities of the Bank of England in war financing, in reply to which there has - been given us from a confidential source the following statements The Federal Reserve At authorizes Federal Reserve Banks, with the consent of the Federal Reserve Board, to establish offices or agencies or appoint correspondents in foreign countries. Aitrough such offices, agencies or correspondents Federal Reserve Banks are permitted by the Federal Reserve Act to deal in gold to open banking accounts in foreign countries and to buy commercial bills Which have not more than 90 days to run, exclusive of days of grace, and Which must bear the obligations of two responsible parties. They have noNpower to deal in investments, to receive deposits (save from the correspondent r-- or agent) nor to open commercial credits. It will be seen that the scope of the activities of a Federal Reserve Bank in the foreign be.nking field is very properly quite restricted, so much so in fact that all transactions which theymay need to engage in can be very well conducted through an agent or correspondent, rather than by means of the more elaborate and expensive machinery of its own office. fore, that the Ban The proposal, there- of England should act as the correspondent in London of the Federal Reserve Banks would appear to suggest a very simple banking arrangement of such a character as any two banking institutions might conclude 2. with each other; it is in fact chiefly notable in that these two institutions, with their immense reserves and with the prestige which always attaches to the business of a central or reserve bank, would doubtless conduct their business with each other along broad lines of National interest, rather than upon the more conventional banks basis of private profit. It is not at all surprising that of such similar character and particularly those which are charged with the custody of the banking reserves of the nation should prefer to do business directly with each other, rather than through intermediaries, as the objects to be served by an alliance of this sort could best be served by a coordinated and friendly policy, rather than by a discordant and antagonistic or competitive policy. Those Who are acquainted with the Bank of Englshd, its management and policy realize that such a relationship is in a measure a departure from a certain isolation Which has characterized that bank's history in the past, just as has been the case with the Bank of Franco. But those two institutions have themselves found it desirable in the past to establish relations of importance with each other to which in fact prominence attaches, whenever an emergency develops the need for coordinating their policy, or for mutual cooperation. It was, no doubt, recognition of the importance and advantage of such cooperation Which brought about the suggestion of the alliances now in contemplation by the Federal Reserve Banks., and the Bank of Englpnfl. The suggestion that British war financing has not been done through the Bank of England is a most misleading comment upon the relations which subsist between the Treasury of the British Government and the Bank of England. highly perfected budget system in England naturally results in considerable economy, far beyond that practiced in this country, in avoiding carrying idle treasury balances. As the revenues of the British Government are collected 3. aora largely at certain periods of the year than others, expenditures and revenues must be balanced from time to time by means of short loans, Which usually in normal times, and particularly now in war times, are conducted by the British Government on a large scale, with or through the Bank of England. In fact, the Bank of England serves as ernment in almost every department of banker for the British Gov- its affairs, it is the agent through which the government floats practically all of its loans and the only departure of importance Which has been made during the period of the war has been in the issue of the so-called "currency mites". are direct obligations Of by the the These are not bank notes but Treasury; they are secured by gold held in trust Bank of England for the Government's account, by interest bearing Goaernment obligations which are purchased by Government Commissioners and deposited with the Bank of England and by Bank of England. cash balances on deposit with the it is an men question Which has been much discussed in England, whether these notes should have been issued by the Government, even with interest bearing obligations and gold and cash balances as security, or whether they should not have been issued as small denomination bank notes by the Bank of England, thereby, of course, considerably weakening the position of the central bank of deposit. When one contemnlates the character and extent of the transactions which the Bank of sgland has conducted for the British Government throughout the entire period of the war, one need not be surprised to discover that that fine old institution has stood as an anchor in the center of the greatest net- work of banking and of the greatest volume of Government financing over developed in the world's history, and has taken the -Shock and strain of the past two and a half years without disturbance to its credit, or to the public's confidence in its stability. The first great financial transaction undertaken 4. by the bank immediately upon the outbreak of the war is net understood or The British appreciated in this country, either in its scope or significance. Government under the terms of the Moratorium undertook to take up so-called "frozen bills". These were purchased by the Bank of England for the Govern- ment's account. The extent of the obligation assumed by the Government and by the Bank of England in this transaction cannot be accurately stated, but it amounted to many hundred millions of dollars and actually resulted in huge purchases of bills for government account by the bank. Thu small remnants Which are still unnaid are now being liquidated by the Bank of England for government account. in the English This transaction restored the circulation of life blood banking system, ahich had been arrested by the war. England's financial heart started to Seat again. Practically all long time, as well as short time, loans of the British Government, negotiated at home have been issued through the Benw of England. It is generally understood that the management of the last loan necessitated the Bankisrsenting a large buildingentire and employing a special staff of nearly 2000 clerks for that purpose only. We in this a)untry who conduct our business so largely under the guidance and restraint's of statute law have not yet realized the benefits and advantages of respect for tradition, for time honored custom and for tions Which have grown naturally instead of arbitrarily. ness institutions of that respect than the "Old Lady character none is entitled to of Threadneedle Street." institu- Among eeiglish busi- greater admiration and Denver, Colorado, April 2, 1917. Dear Mr. Treman: Replying to yours of the 29th ult. regarding that letter to Dr. Vissering. Lluch the sae reason inspired me to make that suggestion as in the case of the Argentine. old personal friend of As ' e.rburg's. matter of fact, Dr. Vissering is an it came to my knowledge that some of the members of the Reserve Board and possibly Warburg felt that we were pressing the English arrangement to the exclusion and that the bank should indicate some desire to develop foreign relations more generally matter rest, of all other proposals than we had yet indleated, 1 au quite but this is a case where at the personal discussion with Warburg might avoid do not correspond with him about these bank any misunderstandings or cross-purposes, If the Putchmen are discriminating future BS/CC misunderstanding. I matters because I want to avoid and will leave it to you against us, for , odness sake Very sincerely yours, New York City. let the first opportunity a little don't lets go courting,them. R. H. Trsga, Esq., Federarneserve Bank, content to Denver, Colorado, April 2, 1917. Dear Mr. Treman: The enclosed letter is just received from a Denver man, who is a director In the Federal :ieserve Bank ofnsas City. He is a very active individual in just such directions as indicated by this letter If I see him, I will try and ascertain what bank it was, but will not make a point of it. Very sincerely yours, R. H. T;amarl, Federal Reserve Bank, New York City. Denver, Colorado, April 2, 1917. !ear Yr. Treman: Yours of March 30th, 2Jv1ng an accieunt of the Rochester meeting of kickers and enclosing their resolutions, etc., is received. Personally, I think the present is the most opportune time to develop our par collection plans and doubt very much if the opposition is going to make such headway. Cengress will not listen with -patience to a long discussion of this subject to the exclusion of important legislation, including the amendments to the Federal Reserve Act. Thank you for keeping me 60 fully posted. Very sincerely yours, e. R. H. Tuain, Esq., Federal Reserve Bank, Neu York City. /7 Denver, Colorado, April ,f7, 1917. Dear Mr. Treman: A It is gratifyina to learn that you found c mafor the Credit nosition. I hone he provos to be a cracking ood one. Very truly yours, R. H TeERg.,11sq., ?edam' Reserve bank, New York City. BS/CC Denver, Colorado, April 2, 1917. Dear Lir. Treman: Now that our Government has adopted the policy of issuing short time bills (which it should have adopted years ago), I believe it would be wise for our bank to offer to the Secretary of the Treasury to take charge of the physical issue, transfer and delivery of these bills, in a service would be of value to the Government in any way. the physical management of Washington, but it does case such Of course the Government's debt has always been conducted in not need to be so and among the other fiscal agency functions to be undertaken in time by the Reserve Banks, we may be able to work up an arrangement to handle the bond issues, payment of coupons, etc. This is just a suggestion to be considered with the idea, of course, of indicating to the Treasury Department in any special matters growing out of 7 7 R. H. Treman, Esq., Federal lieserve Bank, New York City, N. Y. 3s/cc that we stand ready to be of service war developments. Very sincerely yours, Denver, Colorado, April 3, 1917. Dear Ax. Treman: Yours of the 29th, reporting the Directors' received. Meeting, is just I agree entirely with the Board's view about the twenty million loan to the Government. a sound financial program. The rate was too low and it is not I.suppose I would have done just what you all thought bast to do in offering to lend the money and give the Government a little interest in connection with the loan, but I still feel that such patriotic rates are really unwise and that it is an- businesslike. It will certainly be wise to sell the three million 3A conversion bonds if we can. About gold now arriving, it might be well to figure out just what we can do in order to get bars, even though McAdoo will not give us a)ecial facilities. I wish I could be at Vsnderlip's dinner. Very sincerely yours, ,/' R. H. Trsesz Lsq., Federal Reserve Bank, New York City. BS/CO Denver, Colorado, April 4, 19174 PlaBJNAL. Dear lir. Treman: I enclose a letter just received from Mr. McKay. Mr. Arnold I oelieve is a man of considerable ability. If he were open to an offer from the Federal Reserve Bank, he might prove to be the type of man for the position as Deputy Governor, as he is an experienced banker and has occupied an important position in the First National. If that sugestion appeals to you and the others, and you will let.ma know, I would arrange to run on to Chicago and see him myself. It would probably be unwise just now to make inquiry of Mr. Foregan. I will explain the reasons later when I see you, but this Is another case whore Mr. Kent can give you some information and will respect the confidence of course. Veri sincerely yours, R. H. TrQmpul, Leg., Federal Reserve Bank, New York City. Denver, Colorado, April 6, 1917. Dear Ur. Treman: 1 anticipate that our clerical force may be somewhat depleted by enlistment and otherwise. We cannot get at the job of protecting our organization too quickly, particularly as we may have very heavy demands made upon us before very long. May I suggest, therefore, that new clerks be taken on just as rapidly as they can be would not hesitate to employ a goodly proportion :ark as they can perform, because they will located, and I of women for such not be subject to military service, unless they volunteer in some department, and I do not know but what working in the Federal Reserve Bank is just as much a patriotic duty as working in a Red Cross Hospital. I am sure that you and the others have all had this in mind, as well as the necessity for looking into the condition for additional floor space, which we might require at almost any minute. I do not mind confessing that I am hanging on here merely by my eye-lids. The desire to return is almost irresistible, particularly as it would give me opportunity to see my oldest son Who has been mus- tered into the Federal army and may be shot off to some remote point at any time. Very sincerely yours, R. H. Treman, Federa1'ireser7o Bank, New York City. BS/CC Denver, Colorado, A11 9, 1917. Dear Mr. Treman: *attleowieellik I have not written you anything about the possibility of bills of German origin causing sine trouble, realizing that you and the others have undoubtedly given this careful consideration. Now that we are at war with Germany, however, and you have probably looked into the sitnation as to all of the bills of South American banks, would you mind dropping me a line, advising me learned. Is there going to be any trouble between our bankers and the German banking institutions connection with South with Which they have American matters? Very truly yours, R. H Treman, Esq., Federal Reserve Bank, New York City. BS/CC in a few words What you have dealt, particular* in Denver, Colorado, April 10, 1917. Dear /Ir. Treman: Thank you for yours of the 7th, with memorandum of your doings in Washington. It was just as well not to say anything further in reply to AzAdoo's statomont and I am glad you sat tight. The episode was of trif- ling importance comgarod with the seriousness of the whole situation and I feel a good doal of consideration for AcAdoo, who has been under such great pressure. Curtis has written me in some detail about the financial program and I will write him, asking you to read that letter as an anzwer to yours. Best regards to you all. Sincerely yours, R. H. 41pan, Fedoral-Tesorve Bank, New York City. Denver, Colorado, April 10, 1317. -iar Mr. Treman: Yours of the 7th about the proposed amendment to the bankino: law has just reached me in the same mail with a similar letter from Ur. jay, to Which I am replying sugestin6 a possible answer. Very sincerely yours, R. H. Treiea,a, Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, April 16, 1917. Dear Mr. Treman: Replying to yours of the 10th about our organization, let me write a faa frank words on that subject as it appears to me from here. I think the Junior officers, say Mr. Sailer, Mr. Jefferson, Mr. Higgins and others if necessary should be called on to sketch out a plan and make all preliminary preparations possible for handling our share of the pending Government bond issue, even though we are not yet definitely advised that we will do so. This will include temporary help, additional space, addinn machines and all the mechanical arrangements applying to such a transaction, including the handling of Government deposits with member banks made through us, should that plan be adopted. Of course we would need to draw on the services of other banks and I believe that the best man in New York to manage a job of that kind is mr. B. W. Jones of the Bankers Trust Company. before. No doubt he could be borrowed, as he was once 1 r" The Discount Department would eresent a most serious problem if we had men in other departments already trained. Where I fear we will fall down is, as I have written Mr. Jay before, in the work of some of the Senior officers. graph in your letter. This is suggested by one para- I really think it is a mistake for Mr. Jay, simply as an illustration, to give his time to making arrangements with Mr. Malburn of the character mentioned in your letter. Personally, I think Mr. Malburn should be invited to come to the office for a conference. In five minutes 2. To - Mr. Treman. Anril 16, 1917. it could be explained that we were seeking to develop cooperation and then the Whole matter be turned over for arrangement to some man like Jefferson. That is the kind of work that Mr. Jay should delegate. am still standing bitched out here, but with some difficulty. Certainly 1 should return for a few days any way to meat Lord Cunliffe when he arrives, and I await word from 1.1r. Jay on the subject. Best regards. Very sincerely yours, R. H. Treman, Esq., Federal Reserve Bank, New York City. Denver, Colorado, April 16, 1917. Dear Mr. Tremah: I have yours of the 12th, enclosing copy of a letter received by Mr. Jay from Mr. Meredith of the Bank of Montreal. r. Jay had already sent me a copy of this letter and I have written him about it. Very sincerely yours, R. H. T4Rawn, Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, April 16, 1917. Dear Mr. Treman: Thanks for copy of letter received from Ur. James Brown about the exported gold from France. It is most interesting and just about what i expected. There seems to be nothing further we can do here, pending the receipt of Pallain's reply. Very sincerely yours, R. H. Tan, Esq., Federal Reserve Bank, New York City. -0/ Denver, Colorado, April 16, 1917. Dear Mr. Treman: Replying to yours of the 11th, I think it would be a mistake to have more than one officer of the Bank attend the Briarcliff meeting. One of our difficulties has been too much overlapping in some of these matters and I hope it can be arranged to have the ground covered by one man only. Very sincerely yours, R. H. Tremaa, Leg., FederaPTeserve Bank, New York City. BS/CC Denver, Colorado, April 16, 1917. Dear 14r. Treman: Replying to yours of the 12th, reporting What transpired at our Directors meeting. I rather lean to the view that we should continue salaries eipi, if possible, hold places open, subject to course to revoca- tion at any time, in favor of men who enlist. The salary to be paid them Should be gross with deduction of Whatever they received in the service and whatever allowance might be made to their family. At any rate, the English banks are all doing that, although I understand the French are not. Cannot that matter be held in abeyanceuntil banks we know just what the Government proposes to do for the families of those who are going to enlist? sincerely yours, C.--.Very R. H. T.gman, Esq., Federal Reserve Bank, New York City. BS/CC 7 Denver, Colorado, Anril 16, 1917. Dear Mr. Treman: The reason for my suggesting submitting a proposal to MeAdoe that we could handle the distribution of short term obligations, effecting transfers, etc., was because I thought that particular scheme night not occur to him and, consequently, it should be brought specifically to his attention. All the short obligations of the British Government are handled through Bank the of England that way, and it would save an enormous amount of bother, correspondence, ate., for us to issue them right in New York, where so many of them will be taken from time to time. Very sincerely yours, R. H. Tre Federal eserve Bank, New York City. BS/GC COLORADO APRIL 17, 1917. Dear Mx. Treman Replying to your various letters about a Foreign Exchange man. From what you say, Arnold is not the man we want. idea of getting I would not give up the Brady without pursuing it to a funish, as i think he might be just the man. Deans was suggested to me by Kent over a year ago and I did my best to get him but without success. Mr. Kent has written me that he is still working on the matter and will try and make a suggestion shortly. In strict confidence, I have a letter from Mr. J. F. Schmidt, Mr. Kent's second man, who inquires as to the possibility of his getting the position; copy of his letter is enclosed. Of course this must net be disclosed to Mr. Kent. Schmid in my opinion is just the man for the position, but there are one or two difficulties. would not want to let him go. One is that I know the 3ankers Trust Company Another is that he is of German parentage, although born in this country and we would need to look into his views about the war very thoroughly. result. I am writing him and will advise you of the He did a lot of work for me when the war first broke out and at that time demonstrated that he had no end of ability, thorough knowledge of the business and, furthermore, that he was not pro-German, but his views may have changed since then. Very sincerely yours, R. H. Tzemen, Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, April 16, 1917. Dear Treman: Thank you for yours of the 12th with an account of Mr. dinner. Vanderlin's It is all well enough for him to say that the Clearing House and Reserve bank are not suffioiently identified and I understand his doing so, but if he will look over the record, he will find that ever since we organized we have been urging meetings together and all sorts of schemes of cooperation which the Clearing House so far has not seen fit to encourage. There is no point to be made of the matter MOW, but it might be that some of those at the meeting may not have understood our attitude in the past and gathered that we were either too slow or too indifferent. hope you or Mr. Jay made that I clear. Have written Mr. Curtis fully about the bond issue. I agree with Aiken that two billions of one year certificates of indebtedness should not be issued. It would be better for the Government to borrow on shorter obligations Which would be constantly maturing and which could be paid off out of the proceeds of bond sales and tax collections when the amount got large, and then a fresh start made. Sincerely yours, R. H. Tan, Esq., Federal Reserve Hank, New York City. BS/CC Denver, ,,olorado, April 18, 1917. Dear Mr. Treman: Your letter of the 13th and Mr. lienze/Is memorandum indicate a very satisfactory situation as to German bills. Let me suggest, however, that instead of dealing through Mx. Brown, and other third parties, it would be a little better and in a way more dignified for the Federal Reserve Bank to twe this matter up officially with the British and French authorities. This could be done either throw,h Lord Cunliffe when be ar- rives or through the Reserve Board or with Sir Cecil Spring-Rico. Very sincerely yours, R. H. Treman, Esq., Federal Reserve Bank* New York City. BS/CC Denver, Colorado, April 18, 1917. Dear Mr. Treman: Thank you for yours of the 13th. the matter of gold bars. You refer to the discussion of I feel the urgent necessity of making progress in that matter right away because with the credit of this Government behind the allies, there is no doubt in my mind that it will result in an earlier recovery of the exchanges and possibly a turn in the other direction long before it would have developed without our participation in the war. NV suggestion now is that figures be prepared accurately to show just What it would cost us to accumulate aa:y one hundred millions of gold in mint bars, joint account with the other eleven banks. Possibly you will take this up with Mr. Curtis and start something going. It seems to me that you can count definitely an my return by the first week in i expect to have a final discussion of this with Dr. June. Sewall on Friday of this week and even if it proves impossible for me to stay permanently all of this year, I would devote enough time to working -V Out the problem of organization so that your plans could be worked out 'onclusively. I am getting along famously and, barring accidents, think you can count on this program. Very sincerely yours, R. H. T40,5511 Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, April 18, 1917. Dear Liz. Treman: Replying to yours of the 13th, I have written fully expressing some views about state banks and trust companies acting as government depositafies and hope you consider it for what it is worth. It is a close question in m7 mind and yet, now that the bill is passed authorizing such deposits, I suppose they must be made. I have written Jack Morgan, asking an expression of his opinion about the big trust companies and state banks. The Clayton act will still be the obstacle and I woula like to sea steos taken to overcome it, if possible. \ I am playing a bit of (;olf almost everyday now and getting on famously. Very sincerely yours, R. H. lospu.Esq., Federal Reserve Bank, 7 New York City. BS/CC CLASS OF SERVICE COrT Fast Day Message / Letter iv.jItt Messaae Night Letter If no class of service is desig- WESTTEMH UlAMOM TELEEMAIMI% nated the telegram will he transmittad as a fast day message. Denver, Colorado, Anril 209 1917. R. R. T*sman, Federal ilesorvo Bank, Now York City. hile rato seems rather lea believe we should place as such of issue no possible because that yill demonstrate attitude of Dew Yerk banks and if rate is much too laa that fact will be more apparent in Other districts stop. Thiw;. Now York banLizers Should realize that any demonstration of Socrotary's misjudgment of rates should arise from failure of borrowings in other districts than ours. Benjamin 3tron6. Ch. Benj. Strong, 4100 Lontviaa. Denver, Colorado, April 20, 1917. Dear Mr4_,:gamLIP: Your telegram about the 250,000,000 issue of government notes came last night just as I was leaving the house to attend a dinner and patriotic rally at the Denver Club and I was unable to send a reply without keeping ng hosts being so far out in waiting. the country. That is one of the difficulties of I have given a lot of thought to your advice and this morning I au renlying as per enclosed copy. It seems to me that the Secretarv is makint2 a mistake in the method he is pursuing for placing these notes and I hope opportunity will be taken not to criticise the plan but to suggest an improvement on it which will be of aesietance to him. I think that the Government should make arrangements with the Reserve Banks to have short notes on sale constantly, the rate to be fixed from time to time according to the needs of the Avernment for balances and the condition of the money market. Those notes it should be clearly 'understood can be rediscounted at any time at the Reserve Bank, so that member banks will be willi , from time to time, in fact every day that they have surplus balances, to take them up in blocks and if by chance at any time they are short of money, we should stand ready to discount them at market rates. By fixing a rate and the amount to be borrowed, instead of selling an indefinite anount at rates which might vary as frequently as once every few weeks, the Secretary always exposes the levernment to April 20, 1917. To - Jr. Treman. the risk of failure to a loan or to the necessity of placing them on the banks, which is undesirable. It seems to me that the Secretary has overlooked one very important factor in connection with his borrowings and that is the difference in the different sections of the country. By his present in money rates would be pumped out of funds in a rhort time by reason method New York of New York's lower rates, and the rest of the country would be flush with money. Our banking arrangements should enable the Government to borrow with substantially equal facility in any section of the country. The proceeds of the borrowings should be left on deposit in the Reserve banks of the respective districts whore the borrowings are made and those balances, so far as possible, should be disbursed in those dis- tricts. Of course i shs11 Ma40 no direct su,gestions to Secretary McAdoo from here, that opening the door to possible confusion, but 1 do think that you and the other officers should ez,etob up a plan for developing 1 -t;ular syStematic short borrowings by the Government somewhat as above suggested, 11, impress upon him the desirability of pursuing that plan. That has worked elsewhere will work here and 1 suppose you realize that the British Government at one time was borrowing seven hundred million sterling, or thereabouts, bo substantially the plan 1 have su,gested and did so with no disturbance whatever to the ..;nglish money market. So far aa the present rate is conoerned, even though some of the New York bankers might feel it was too law, it is a grand opportunity for Z. April 20, 1917. them to demonstrate that :Jew York always stands ready to help and, of course, the higher rates in the other Reserve districts will be the means shortly of illustrating to Secretary LidAdoo that his plan is not workable. It seems to me you did mighty well in getting ninety millions placed in a few hours. A part of the plan I think should provide that the :ederal Reserve Bank of New York might itself nage the handling of the funds to be left an deposit with member banks that take large blocks of these notes. It would immensely facilitate the work and permit our performin the best service for the Government. Success to your efforts in this and all the other important tters now developing. Faithfully yours, R. R. Treman, egg., 'eederal Reserve Bank, New York City. Denver, Colorado, April 21, 1917. Dear 2r. Treman. I wns delighted to receive your long telegram last night, quoting telegram received from Harding in regard to the issue of Treasury bills. Anparently the vary situation developed that I anticipated and now I am sure you will have no entire issue in difficulty in getting subscriptie7.s to cover the New York, which is most desirable. I still feel that ft program of havinikeertificates constantly on sale at the Reserve banks at rates to be fixed from time to time by the Secretary of the Treasury is by fur the best plan and should be adopted right away. It is mighty good of you to keep me so fully and promptly posted and reconciles me somewhat to being away just now. Very sincerely yours, / Usan, E. H. Yederal Reserve Bank, New York City. c Denver, Colorado, April 22, 1917. Dear Mx. Treman: Thank you for yours of the 18th about the Government bond matter. It gives me a great feeling of satisfaction to have our bank entanglement in a big government bond account, such as is so free of the case In Chicago, Aansas City and elsewhere. I wish we did not hold any, but the anount we do hold is too small to give us any concern as to possible de- preciation. I am relying entirely upon you anii4. Jay to advise me by telegram or telephone of just when should return to meet Lord Cunliffe. I can co ,e bac,c on a flying trip at any time, nor would such a trip interfere with my expected return about June 1st. It really is quite important that I meet him, but at this distance I cannot the best time for me to come back for the puroose, so I rely Mx. Jay to advise nate, Faithfully yours, \\*""----- \ , R. H. tuman, LAN., Federal Reserve Bank, New York City, B/CC judge when is on you and Denver, Colorado, April 22, IVI7. Dear Mr. Treman: Replying to yours of the 18th, I am glad to see the progress that We should not let up for one instant, is being made with the state banks. this being the best opportunity we will ever have to whip them into line. Incidentally, it might be a good plan to get Li.. Hoffman and some of the other newsnaper men who sympathize with our aspirations to write a few articles zine. along the line of Mr. Jay's The public in my opinion does article in the Trust Company's maga- not sympathize with these recalcitrant state banks who are holding out for exchange and some well considered articles in the daily papers will undoubtedly keep this I am interested in what you say about amendments to the It was on my recommendation that Federal reserve to count as cash sentiment notes alive. State laws. were not permitted reserves for member banks and that recommendation was based upon the understanding at that time that the notes would be entirely secured by commercial paper. The character of the note issue groves to be so different from what was anticipated that I now see no reason why state banks should not count them as reserves and I would be glad to see 4 the amendment enacted. Yours very truly, R. H. Txsman, Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, Anril 23, 1917. Dear ar. Treman: Yours of the 20th, enclosing the program of the up-state bankers for their Rochester meeting, is just received. The fight in this matter has really been transferred to Washingtou end I am sorry to gather from rburg's letter that he feels some concern about it. Personally, I cannot share his views for I think the country as a whole is doing to support us in our program and if the country does, Congress will. Certainly the documents you enclose, if published in full in thu daily papers, would not receive a very enthusiastic reception. It has a \Ter,/ narrow sound to me and I think most people would interpret the stateleents in that way. I am glad to learn of progress in preparing for busier times. Very sincerely yours, R. H. Triewan, 11eq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, April 23. 1917. . Dear Mr. Treman: Replying to yours of the 20th about a foreign exchange man, 1 hope you will continue your investigations just as fully as possible, so that we will have all the data and, if possible, the rnn before I return. Of course no man who has 7worked for 25 years, is 50 years of age and leonly earning 42500, can be considered more than a very ordinary clerk and we really need a very much stronger man that he likely is to fill the position, even in a preliminary way. ay leanings are towards Brady if he is in any way available. Ver7) sincerely yours, R. H. Tan, Federal Reserve Bank, New Yort.c. City. lc a Denver, Colorado, May 18, 1917. :,ear 1.1r. Treman: The enclosed letter from Mr. McGarrah explains itself. I will as:: you to refer to my letter, which Mrs. McLaren will locate for you, and after getting in touch with Mr. McGarrah, advise me of the exact status of eul- sutzeations to the Clearing House Committee. Mr. lic- Garrah's letter is a little too blind for me to undcrstand it. Very sincerely yours, R. H. Tuition, Esq., Federal Reserve Badk, No Yoric City. Denver, Colorado, Llay 19, 1917. Dear Mr. Treman: BANii OF ENGLAND. With reference to the enclosures in yours of the 15th, let me suggest that in replying you intimate that we believe it would be desirable for both the Federal Reserve Bank of New York and the Bank of England to make preparations for the drawing of checks respectively on the banks' accounts which we will carry with each other, but explain that our checks will be in round amounts only and drawn only to represent sales of exchange when we are withdrawing balances, that no checks for commercial purposes will be drawn on the account and we presume a like principle will apply to their relations with Us. That most of our transfers, at least under pres- ent conditions, will consist of cable payments under 'lode protection. It might be desirable to prepare a cipher similar to the one employed with other Reserve banks, only varied as to the symbols and, of course, transmitted under the usual protection. Embassy pouch, I suggest that it be sent through the addressed to the A,erican Ambassador in London, with request that he have it delivered to the Bank of England. 1 would also suggest that you advise.the Deputy Governor that the pendency of the loan operations of our respective governments makes it seem inadvisable for us to undertake any extensive operations for the moment, and that we are still without an experienced officer to handle the detail and that it will take some time to obtain the necessary authorizations in detail from the other eleven Reserve banks, all of Which however are under way and as soon as completed full details will be furnished, together with a suggestion of the amount of our possible transactions. 2. To - Mr. Treaan. It might be May 19, 1917. well to advise Mr. Cokayne that we are having duplic ate original copies of our agreement engrossed for exemplification for both institutions, to become apart of our permanent records, which engrossed c opies can be substituted for the typewritten Copies now held. I think of no other points to be covered and therefore am seturning all of the enclosures with your letter, confidential which should be placed in file. Very sincerely R. H. Trajaam, Esq., Federal Reserve Bank, New York City. BS/GC Enos. "-- yours, the special Denver, Colorado, May 19, 1917. Dear Mr. Treman: Thank you for your two letters of the 15th. I reached here in good shane and am now indulging in a good course of golf which is interesting and beneficial. Dr. Sewall has just telephoned me an excellent report from an wiemination that he made on Thursday and one Which satisfies me that no harm resulted from my trip home. I am writing separately about the Bank of England letter. Again many thanks and more for your help and your willingness to continue to help, which is characteristic of your attitude toward the bank and its officers from the beginning. ' I cannot tell you how grateful I am or what a groat help it has been to me in my struggle for health. With warmest regards, Faithfully yours, H. Tamgn, Esq., FederarReserve Bank, New York City. BS/CC' - Denver, Colorado, May 20, 1917. Dear ArL.2444u4an: I have yours of the 16th, with enclosures which are returned herein. I had seen Mr. Gidney's memorandum before leaving New York. My last suggestion to him was to follow the matter up and see that blank certifi- cates were prepared by the Clearing House authorities, if possible, in such a form that they could be put into use on very short notice. Mr. Frew's memorandum is simply a re-statement of views entertained by Ur. George Blumenthal of Lazard-Freres, who explained them to me verbally when 1 was in New York. The only new idea is the thoroughly unsound one of making unlimited use of government securities the basis of unlimited issues of paper money. When we reach that deplorable state of financial degeveration we might as well admit that on a gold basia, the world is no longer including theU.S.A. Every other idea in the memorandum, as you will appreciate, we have been harping on insistently for two years. all of this conversation we can finally got our colleagues in I:ashington, as well as the about it. I do with and hope that after Clearing House committee, to do something and quit talking Just as sure as fate this is one of those eatters that will be postponed and again postponed until the emergency arises and then it will bete° late. Tqe thing balances should to do now is to convince tho Clearing House committee that be settled on our books and that they should take appropriate 4 2. To - Treman. May 20, 1917. action instantly that the amendments pass to affect such settlements as are effected in cash with the state members in Federal Reserve notes. would be advisable for us to agitate again the project Reserve notes count as legal reserve for state banks. It of having Federal With those three things done, ug concern about the imnediate future is reduced to nil. Without having them done, you can bet your last dollar that we are going to have trouble in New York and it is not very far ahead of us. There tender. is no necessity for having Federal Reserve notes legal Neither gold certificates nor silver certificates not National bank notes are legal tender and they form the great bulk of all of our circulating medium. Cannot someone press this matter House committee and try and get something done? with the Clearing Vanderlio is the one :an to help as he i.e thoroughly impressed with the importance of this action. .\\ I am mighty glad to get such full reports from you. Very sincerely yours, R. H. Treman, Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, May 20, 1917. Dear Mr. Treman: Replyin; to your general letter of the 16th1 It seems to me that someone in theoffice must have slipped up in the arrangements aboutthocile chocks aggregating 450,000,000. Morn's people have agreed to the ar- rangements that I proposed to them no objection to it. seeing that these About the Please charge and the metbor banks will certainly make Mr. Sailer with the responsibility for arrangements are carried out. Foreign exchange man, - if we do not get Mr. Perkins. I think we ought to dragoon the City Bank into giving us Mr. Brady, so I have done nothing in the matter, awaiting the outcome My last word with Perkins was an understanding of the Perkins matter. that he would see Woodward immediately upon Woodward's return. I am playing golf every afternoon and feel the benefit of it I. tremendously. Best regards t6 you all. Very sincerely yours, R. H. Treman, Esq., FederarReserve Bank, New York City. BS/CC Denver, Colorado, May 22, 1917. Dear kr. Treman4 mpny thanks for your letters. I hope that Mr. Sailer is carefully working out the arrangements about these big transfers so as to avoid possibility of a money up-set. It can be done with a little care and cooperation and it is exceedingly important. Very sincerely yours, R. H. Trepan, Esq., Federal Reserve Bank, New York City. BS/CC Denver, Colorado, May 22, 1917. Dear Mr. Treman: Thank you for yours of the 18th, enclosing samples of the now forms of drafts and posting me as to doings at the office. I have telegraphed Mr. Perkins and Mr. Woodward and there seems nothing more that I can do from here. The matter now seems to be up to Mr. Perkins, Ur. Vanderlip and Mr. Woodward and I hope to have a favorabl rely. According to the present plan, I will probably see you in /Tow York the middle of next week. Best regards, Faithfully yours, R. H. Twan, :sq., Federal Reserve Bank, New YorK City. Denver, Colorado, 0Al1y 23, 1917. 011114. Dear ilk. Treman: My present lan is to leave here about the 6th, which ,7 York the 8t% or 9th, asad I hoc that will would got me to lino -uith your own plans am! not inconvenience be cult' would havc to return than any way to attend the you at ,eting in 1: hington on the 15r.. and have a few days in New iork first will WT but meantime netio Par1:ei4s department, e °opt go in the zmlary matter, out sA.ary in Hiss i3S Keys. 1 am tment and a few to make a personal mE,.. rivatelL ot1or0, and am writing you se gest that yOU might toil lass Parker hat her salary 7i in abeyance, pandiPg my return. T hope this i2 in accordance with ur OWT1 viel lours very trul R H. Troman, Pederal Reserve Ban row York City. B3/00 held Denver, Colorado, July 23, 1917. Dear Ur. Treman: - I have your lettersof the 16th, 17th, 18th & 19th, and thark you most heartily for keeping me so well posted. , a little courage by our bahking friends About ship in our office is all that is needed to and the le se 10'd rates and I hope you and the other officers can get t ether with LIOGarrah on some plan which will keop 1 very much regret a bad e,dy. We things ic 1 record in look over the copies Would ascertain just how of the last repo 7 much eligible aper each if our flow Yorl City member banks there, I think banks holds. If the info ation is no va rring with Garrah, askwe should prepare a letter, 6 ing each bank in Now York City to g v us the infori, ion, divid- ing it into three classes :lligible commercial p Ankers bills, evernment securities or ment securities. . on govern- Your report on the Italian negotiations is most interesting. I do not understand the first proposal - there is probably a typographical error. If this can be rolled along until my return, well and good, but don't hesitate to deal with it during my absence. I an writing Ur. Jay about the Bond issue diviAon. I hope the readjustment of Government deposits is promptly effected so as to avoid any sore-heads as to the next campai7n. http://fraser.stlouisfed.org/ Sincerely yours, Federal Reserve Bank of St. Louis L,r4 1 Denver, Colo., July 31, 1917. Dear :r. Thank you for your various letters and for keeping inc so well poste branch in Buffalo - I an decidedly opposed to Abell , desire to 11., certainly unless the bankers there express a If they do, we than sheuld give it e a branch. serious eon dem' I wrot Lock about it personally believe he has made inquiry before lacy' sive in Washington. locally so that I feel sur.t our collection charge to IN per item. The suggestion abo How would it do to get Captail has been pctoned by the First iational Dank? He is a very liable man. be well to inquiredt the First 1ationa whether he wo equal to the job. It is essentially the Id of we be done by an older man, or oven by a reliable night d be that could Ian. It is certainly bully of you to consider returning again to the bank after you have had a holiday. You are always - to self-depreciating about year own work there that sometimes it -makes no think that you are keen to get away again. other hand, I do not see wki. you should not accept the expressions of appreciation of your own associates at full value. On the It is a -2To - July 51, 1917. roman. difficult job at boot and -articularly so for any one from out of tom. i don't know vhat we would have done without you, and if you do find it posoiblo to roturn after your vacation, it will of course be a tror-ondons relief to me and probably enable me to ;other short rest before the real active time an is placed. ,got off again i when th, - . Jay and Zailer should certainly tako holidays wo must not all break downs' =ft I am sure ',-hat can be arrang ito very few letters, and that lay a good deal of golf, were you here yol ly approv all ol which Dr. Curt , AthfUlly your R. H. (.2reman, ,sq., 2odoral :osorve Bank, EOW York City. 1157CC WESTEjj- UNION AM TEL CLASS OF SERVICE DESIRED nay Message !ter wksTERNUNION Night Message 111\ Night Letter Patrons should mark an X opposite the class of service desired; OTHERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. NEWCOMB CARLTON. PRESIDENT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to Domor, 1010., July 019 1917. a.trei-am, Foloral riosorvo :170.7 Yar% Cityo Strzor.,t yon ack Kent to shmt you. my tologram of toclou rogardig3 tal iz arratis °Lento. Tlerajardll Stirs AC.) Thg 3on,j. St/Dik-j, 123 Gilpin St. Receiver's No. Time Filed SS OF SERVICE DESIRED Fast larSTE 01,11 J.LVO 47i4N lessage UNION TEL' AM WESTERN UNION Night Message Night Letter Patrons should mark an X opposite the class of s3rvice desired; OTHERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. s Receiver's No. Check Time Filed NEWCOMR CARLTON. PRESMFNT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to Denver, Colorado, August 1, 1917. 21._)144nan4 Federal Reserve iank, Necl-York City, 11 Y. Hope you agree tbat it would be unwise for us to subscribe ourselves for Certificates of Indebtedness about to be issued. Benj amin Strong. Chg. Benj. Strong, 128 Gilpin St. ALL TELEGRAMS TAKEN BY-THIS COMPANY ARE SUBJECT TO THE V., .LOWING TERMS: T To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for coin, )ne-half tse unrepeated telegram rate is charged in addition. Unless otherwise indicated-on its face, THIS IS AN UNREPEATED TELEGRAM AND PAL. n 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, an. 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 receiv., or 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 obseurt 'elegra ms. 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 ;aimed 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 nae 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 when necessary to reach it Iestination. Telegrams will be del red 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 umns. 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 ontract 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 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 iledvith 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 alt., e 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 rAST DAY MESSAGES A full-rate expedited service. 1 I GHT MESSAGES Accepted up to 2.00 A.M. at reduced rates to be sent during the night nd delivered not earlier than the morning of the ensuing business day. )AY LETTERS A defer-ed day service at rates lower than the standard day mesage rates as follows: One and one-half times the standard Night setter rate for the transmission of 50 words or less and one-fifth of he 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 etter" service, the following special terms in addition to those enu- Letter shall be delivered on the day o. its date absolutely and at all events; but that the Company's obligation in this respect is sublect; 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, 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. ierated above are hereby agreed to: Day Letters may be forwarded by the Telegraph Company as a Arred service and the transmission and delivery of such Day Letters , SPECIAL TERMS APPLYING TO NIGHT LETTERS; in all respects, subordinate to the priority of transmission and In further consideration of the reduced rate for this special "Night Letter" service, the following special term.. in ad...Li-lion to those Day Letters shall be written in plain English. Code language Night Letters may at the option of the Telegraph Company' be mailed at destination to the addressees, and the Company shall ;livery of regular telegrams. not permissible. c. This Day Letter may be delivered by the Telegraph Company , telephoning the same to the addressee, and such delivery shall be a mplete discharge of the obligation of the Telegraph Company to liver. This Day Letter is received subject to the express understand., and agreement that the Company does not undertake that a Day D. enumerated above are hereby agreed to: be deemed to have discharged its obligation in such eases with respect to delivery by mailing such Night Letters at destivation, postage,; prepaid. Night Letters shall be written in plain English. Code language is not permissible. No employee of the Company is zuthorized to v.:.-,7c ihe foregoing. ` IV ICE SYMBOL Jay Lobe, Blue Night Message Nite Night Letter NL A'i0E I; ESTE.;AT? WON ITELL If none of these three symbols appears after the check number of words)th is is a day message. Otherwise its character is indicated by the symbol appearing after the check. .474r WESTERN NEWCOMB CARLTON, PRESIDENT RECEIVED AT N2OD CRY OENVER COL.: Form 1201 Uri° AM ,- CLASS OF SERVICE SYMBOL Day Message Day Letter Blue Night Message Nite NL Night Letter If none of these throe symbols GEORGE W. E. ATKINS, FIRST VIC ,PRESIDENT appears after the check number of words)thls is a day message. Otherwise its character is indicated by the symbol appearing after the ch.*. 26 AUG 3 6PM ii R H REMAN -FEDERAL RESERVE BANK 261-'6 NEW YORK FIVE TWENTY FIVE AM ARRIVING ON PENNSYLVANIA TRAIN DUE AT EVENING MONDAY AETERNOON SUGGEST CONFERENCE SOMETIME MONDAY PLEASE NOTIFY ME PLAZA HOTEL OF ARRANGEMENTS YOU MAKE BENJMAIN STRONG Kei707 Form 1206 liVESTE - DESIRED age , 7,5113NA. .-ener UNION WESTERN UNION Night Message TEL Night Letter Patrons should mark an X opposite the class of service desired; OTHERWISE THE TELEGRAM WILL BE TRANSMITTED AS A FAST DAY MESSAGE. NEWCOMB CARLTON. PRESIDENT Send the following telegram, subject to the terms on back hereof, which are hereby agreed to 7.0 Z.z '"ew AM GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT Denver, Colorado imgust 3, 1917 R. K. Traman Yederal Reserve Bank New York City Lin arriving on Pennsylvania train due at five t7enty..five Monday afternoon. Suggest conference .caetime Monday evening. Please notify me Plaza Hotel arrangements you make. Benjamin Strong arge 8 Gilpin Street DAY 12.951.024 ALL TELEGRAMS TAKEN BY THIS COMPANYARE SUBJECT TO THE FOLLOWING To guard against mistakes or delays, the sender of a telegram should order it REPEATED, that is, telegraphed back to the originating office for cc mp,_ one-half the unrepeated telegram rate is charged in addition. Unless otherwise indicated on its face, THIS IS AN UNREPEATED TELEGRAM AND PAID 14,ot 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 trarismission or delivery, or for non-delivery, of any UNREPEATED telegram, beyond the a 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 rem, 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 obsc 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' 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 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 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 when necessary to reach 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 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 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 telegram is sent to such offi 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 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 Ahe foregoing terms. fo THE WESTERN UNION TELEGRAPH No employee of the Company is authorized to vary the foregoing. 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 enu- merated 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 understand'lag 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 a events; but that the Company's obligation in this respect is subjec to the condition that there shall remain sufficient time for the trar. mission and delivery of such Day Letter on the day of its date durin regular office lours, subject to the priority of the transmission of reA 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 ensuiv business day, at rates still lower than standard night message rates, follows: The standard day rate for 10 words shall be charged for thelran 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. 1 SPECIAL TERMS APPLYING TO NIGHT LETTEIV: In further consideration of the reduced rate for this special "N: Letter" service, the following special terms in addition ttf. enumerated above are hereby agreed to: . Night -Letters may at the option of the Telegraph Com} be mailed at destination to the addressees, and the Compa.P be deemed to have discharged its obligation in such cases ,wrfh to delivery by mailing such Night Letters at destination, posta prepaid. Night Letters shall be written in plain English. Code langul is not permissible. No employee of the Company is authorized to vary the foregoing: in111111111Wr NL of these three symbols Letter .e 11111111111r CLASS OF SERVICE SYMBOL 4)44X Day Letter Blue WESTERN UNION Night Message Nite w, N. Night Letter NL Pay Message cr, If none of these three symbols ,,ears after the check number of words)this is a day message. OtherIts character is indicated by the symbol appearing after the check. 'wise NEWCOMB CARLTON FRESIDENT RECEIVED AT GEORGE W. E. ATKINS, FIRST VICE-PRESIDENT appears after the check number of words)this is a day rnessaie. Otherwise its character is indicated by the symbol appearing after the check. 0306.00, 411 way, IV, Y. It17 F,'JG 5 V, 11 26 CHICAGO ILL 5 A H TAEMAN 8718 FEDERAL RESERVE BANK NEWYORKCITY IF THE MATTER MENTIONED IN YOUR IRE RELATES TO FOREIGN LOANS SUGGEST YOU SEND ME AT PLAZA HOTEL COPY OF ACT UNDER WHICH THESE LOANS ARE AUTHOhIZED AND ANY OTHER PAPERS I MAY NEED - BENh STRONG. 1111