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‘i - R w r k t o 3 C3 c a s - u d t r n m v r a ssa m j i i c a lClJD /UM., JXft-T 15, 15-63 ( £ 4 c^ool&jlctJL erdir of tia foUovic^ cstij ejjt lurt V* eccjtertaly ecrrsot, V.* ell ef tis najc* joints t n ------- -4. 1« gscret&ry tdllca c*5£&d tlm cs^tixvg by dtsarlfcin^ tki proposed isare&se in the dl&3cunt r&to vhicb la * or* «j£X*c&ah, t4 rxcistfiry policy# Et tiwa thst i£a teCAz^-cf-pajfccste eltu&tlasi v&a c\u*reatiy drreio^lng to tbe point to %&sn It fcsixkred ca * "roa* ca tb3 dcllzapt AscordLcs to Cspoitssat of CCEsatrce &sfiaitlcca, |ce» llz&mjr/ te£* a&ov a ceecod ^asrtcr deficit la tfea n^l^t^astood of 45 M illon st cssaal rutca. (Xa p?t| thle resalt* ffcea t&e ccnTmr®l£sa of the Xtallftar cca-coavtrUbla borrcvisg to & ecarortlfele t&£l*« Al«d, t&ss* ere otbsr premiers of dafl<laa of the d&flalt tbat D^td to h r*rolT*d*) Aa locreeoe la tbe diocsust r*te end a eacm&at fewdlcr riie in tho fre^rjery felll w t e eculd reejt $500 ■Alllcsa lm chartHom capital cutflcvs. S^iSj iojstiiW witb tbe ctkar *rtl«u vhich t&e Freaidaot vill snasenes lstsr this vsck, vould produce tctal b&lBaeocf-psyscnta taring* of ease |2 fcilllcn* & • Gierstezy ate&ed hit te lU f t h l thi r itt la ehsrt-tora ret*# eoald I t effected vltli bo dgB ft^eat Ixjgaat on lo o ^ c jsi interest rctea or credit avel U tility # , „ ^ \ 1 VnKl *'1 &»~C. f i l KJ ®r S* Chalraea laller itataft rilila i the dleoooet rata* fit M l ***** tfie effect ef tbs laeseeee i l p l not be eooflaed to thi to M tx x aateIf M eoald resell 1b a rtee 1b lantern y it iijf'—* la ^erleed Ihjirtrrrl ef Goess$reo flguree ebcw thsl tbi lacreaee la the leel for cssrtere bee beea lo w tfesa ptlteintry eettimVia ............. ......... \ J U laczvtee t o l a * M ----------- m ^tV J fred . Ul CM. 1 1 »1 ^ * > 1 >e>W i^ r Cbe f m i t e l thee etfkeA Iburtta be i g m l 1rt.H1 Seoret«*y 8 U I m tbe% tbe y ep aeet eet&ea eoeld be tebea edtbool efftpctlag lrmjr^tnfyra rcdeef end levUev II eee yollflgr le w w eai * l U e la Ine§ t e m retae* M o m Untie elatai» •&>•• o Wa Mmmnm be i2cel la ***** H n s t l e y be eedt M l yretlet wltb e n t d r t r theltbe ttfw l ef toe eetlea wfll be loifleei is laMrwWBTfete^ fcittw^jNieril jin«n>e eoaU aeke a o ^er tfftrt to eebleve %**f* f ^ t r fbe fv e d t el eelsed bov ttcU v m II be dene^ eoi Cbelnea Until eleled the! tbe Prfr**1 teeewe r**H etaoestvele ea yayehaeleg latereedlete and laag^teni eeeuarltlee to tbe a d a a exteal |oatfUi| acid tbet tte Creeeosx rtedd eeaeeatnAe lie flaiaelas la tbe c t e r M c a i H M t lecrttiiy jlllea egreed thel tbla eeeld be deoe> CfcrJ.ns23 E U l e r jctntcd cat that thi rito Iti'tha dlacourit reta w o l d call fcrth ritstf.ntial cjpotHlea fxca luxy K^sb&rt cf Consrsea uA thst way a l w t o a Id tba dcc^etl« ccoo&Ty vhlsfe nl&ht o-:c\ir# vhstter it actually tv ault-fcd fro* F-sr.sUjy policy cr act, v n l d fci fclsa'-d ca tba trd t b Fjijnd Eoard* 3* 55io F ratld ^t a&dd vhat tt* altar&*tlir*a v*r* to & rli9 Ia U j discount rat** Chalrc^a. £ jlla r et&tad ths.tiS* b&la&c*~of«p&y&%2ts probl^a vould bo r^ro effectively h&adlad#*& lec* cost to tha dcsasstla ceccccgr# thrcucfc rxdtilstcr&l &3£ctlatlo£a elaad at gottlsg Surops&a caaikiri<5« to hold « largo portion of thslr reitrvsa la dollars* Ika Frasldsst then noted tbs* d ifflcu ltlai la &ettl&$ Ikiropeca countries* asra&saart ca th is, la particuZat vltfc reapact to tbe frsnch* C » CalUd Stetea h&a &o lcnra^t escapt froa actions vfclch veuld ban the U&Ltsd Stats• M vail as £oro?*« fc* Stoe president atbad a&cut tba tiding of fcba propocod toereace la the discount ret*. Chains K&rtla atated that be vastad to acaounca the loer»&»a tkftt aftsruoco Qfesdey, July 1$)# Seven Fadaral f&carvt Ssn£a hava already proposed esa l&crt&sa* &» plaaaod to lim Boston lesd Off Vlth the a2JiC4XW4£S3t* Tbt Pwaid-int, hcvs7*r, stated hit prafferoace for tiding tbs dl*cc*sot rate Increase and hi# ova Gtatcawxt oo balaaca of payseota at do t e toeathar cj» poafcslle. It vaa than tbst the Fid&ral £tcarve acsxsiacaaast vould t« cede Ttsseday aftcmocn, and that the rr»iltoxt,« atateasst vculd be relapsed Tturaday at the lateat* aial l r y ^ fcjy The f*re*lSast rtattd that ca Imroaae In Istarart rat&s vould tba pGX««o& of hi# t&x procrca evsa e&re urecat* Za this ccezjectico ha aot»d that public support of tha tax pre*rsa by Cb&lrssa Kartla vould be especially u^fol. mJm 5* SoAgert director 0ordoe j»lntad csat tba icporU-aca of taking aa a^proprlata aniiourKamazst to accosspeziy tba dlacouzrt rata lacraaaa# Css rtatsenst abould fftraat tha fact that tha tacraaj* vaa al&ad aolaly at shast^tm rataa# tad that tha ofe^aetlvea of Bcottary policy at thla ttom did, aot tacluda a rlaa la lflGg^tam rata*. Chalzmsa K&rtla said It haa orrar baaa fadsral Baaarta policy to wi^i thla kind of emcxsse** ffeat^ «2sd thay vould do*% do to thla tlaa* Bi did atata# howrar, that thslr aaeooacaeaea* vouli olta tha halaaae^-psyaeata al^atloa aa tha aola np^aoa for tha dlaoooat rata lacraaaa* tba ludgat Dtrwtor alao atatad thct a rlaa la tha dlaoouat rata aoooagealad hy aa tacraaaa ia loeg«t*ra rata# of aa llttla aa 1/8 pairaat oould ralaa btids»t axpaaditoras, oa a fall yaar baala, %y a# aa |1 Villict> 3 6. kfr. 03reassa ea£33 vnsxiisx cr tot It vcMld b» posaibla to ixwarporato in tbt Pr*3idast'# talaaot^of-g^yeaati ccss^i A cert explicit fttsteasst of tbs <&j«ctlTas of Bonttary poIicy# vlth particular to tbt desirability of avoldic^ icy tightening of eralit la th$ loos-term ssrfett* It v&s cscftrally tgrcsd that *cc» itatosact to thia tffeat ou£$tt to t* included* “%4 Ch&lreaa Ealler pointed out th« oactsaity of ecmentrating stttrcjtion on total reserve* rafcfcar tbaa fr»i rcservss In t^» proposed operatic®. Bocauat of th» ralaticcshlp bstweaa frti r®«rv9»| tb» discount rata, ead ths Treasury bill rst*# it ia axtwsaly is^ortsat to 0-^6 • - ^ gfl^o r j w that undas ccootntr&tioa oq frea rcserves tes^st^leed to a rtatriotiv* polio/ vitJi r#t£*o% to1total raearvcs. 8. The President 3gain stressed the great impk>rtaa<r% 0€ BMelding the domestic economy from the impact of the discount j*ate incJ^ase in the light of the continuing heavy unemployment and modest pace of economic expansion -- and the importance of maintaining expansion until our economic goals have been reached.
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