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FEDERAL RESERVE BANK
OF NEW YORK

"

Fiscal Agent of the United States
Circular No.
1901
December 9, 1938

Public Notice of Offering of $100,000,000, or thereabouts, of Treasury Bills
Dated December 14, 1938
Maturing March 15, 1939

To all Incorporated Banks and Trust Companies in the
Second Federal Reserve District and Others Concerned:

Following is the text of a notice today made public by the Treasury Department with respect to a new
offering of Treasury bills payable at maturity without interest to be sold on a discount basis to the highest
bidders.

S

The Secretary of the Treasury gives notice that tenders are invited for Treasury bills to the amount of $100,000,000,
or thereabouts. They will be 91-day bills; and will be sold on a discount basis to the highest bidders. Tenders will be
received at the Federal Reserve Banks, or the branches thereof, up to two o'clock p.m., Eastern Standard time, on
Monday, December 12, 1938. Tenders will not be received at the Treasury Department, Washington.
The Treasury bills will be dated December 14, 1938, and will mature on March 15, 1939, and on the maturity
date the face amount will be payable without interest. They will be issued in bearer form only, and in amounts or
denominations of $1,000, $10,000, $100,000, $500,000, and $1,000,000 (maturity value).
It is urged that tenders be made on the printed forms and forwarded in the special envelopes which will be supplied
by the Federal Reserve Banks or branches upon application therefor.
No tender for an amount less than $1,000 will be considered. Each tender must be in multiples of $1,000. The
price offered must be expressed on the basis of 100, with not more than three decimal places, e. g., 99.125. Fractions
must not be used.
Tenders will be accepted without cash deposit from incorporated banks and trust companies and from responsible
and recognized dealers in investment securities. Tenders from others must be accompanied by a deposit of 10 per cent
of the face amount of Treasury bills applied for, unless the tenders are accompanied by an express guaranty of payment
by an incorporated bank or trust company.
Immediately after the closing hour for receipt of tenders on December 12, 1938, all tenders received at the
Federal Reserve Banks or branches thereof up to the closing hour will be opened and public announcement of the
acceptable prices will follow as soon as possible thereafter, probably on the following morning. The Secretary of the
Treasury expressly reserves the right to reject any or all tenders or parts of tenders, and to allot less than the amount
applied for, and his action in any such respect shall be final. Those submitting tenders will be advised of the acceptance
or rejection thereof. Payment at the price offered for Treasury bills allotted must be made at the Federal Reserve Banks
in cash or other immediately available funds on December 14, 1938.
The Treasury bills will be exempt, as to principal and interest, and any gain from the sale or other disposition
thereof will also be exempt, from all taxation, except estate and inheritance taxes. (Attention is invited to Treasury
Decision 4550, ruling that Treasury bills are not exempt from the gift tax.) No loss from the sale or other disposition
of the Treasury bills shall be allowed as a deduction, or otherwise recognized, for the purposes of any tax now or
hereafter imposed by the United States or any of its possessions.
Treasury Department Circular No. 418, as amended, and this notice prescribe the terms of the Treasury bills
and govern the conditions of their issue. Copies of the circular may be obtained from any Federal Reserve Bank or
branch thereof.

In accordance with the above announcement tenders will be received at the Securities Department of
this bank (2nd floor, 33 Liberty Street, New York City) or at the Buffalo Branch of this bank (272 Main
Street, Buffalo, New York) until two o'clock p.m., Eastern Standard time, on Monday, December 12, 1938.
It is requested that tenders be submitted on special form and in special envelope enclosed herewith.
Attention is invited to the fact that payment for the Treasury bills cannot be made by credit through the
War Loan Deposit Account. Payment must be made in cash or other immediately available funds.




GEORGE L. HARRISON,

President.

J

No.
TENDER FOR 91-DAY TREASURY BILLS
Dated December 14,1938.

Maturing March 15,1939.
Dated at

To THE FEDERAL RESERVE BANK OF NEW YORK,

1938

Fiscal Agent of the United States,
New York City, N. Y.
Pursuant to the provisions of Treasury Department Circular No. 418, as amended, and to
the provisions of the public announcement on December 9, 1938, as issued by the Secretary of the
Treasury, the undersigned offers to pay

* for a total amount
(Rate per 100)

of $

(maturity value) of the Treasury bills therein described, or for any less

amount that may be allotted, payment therefor to be made at your bank in cash or other
immediately available funds on the date stated in the public announcement.
The Treasury bills for which tender is hereby made are to be dated December 14, 1938,
and are to mature on March 15, 1939.
This tender will be inserted in special envelope entitled "Tender for Treasury bills.1*
IMPORTANT INSTRUCTIONS:
1. No tender for less than $1,000 will be considered, and each tender must be for an amount in multiples
of $1,000 (maturity value). Also, if more than one price is offered, a separate form must be executed at each
price.
2. If the person making the tender is a corporation, the form should be signed by an officer of the corporation authorized to make the tender, and the signing of the form by an officer of the corporation will be
construed as a representation by him that he has been so authorized. If the tender is made by a partnership, it
should be signed by a member of the firm, who should sign in the form "
,a
copartnership, by
, a member of the firm."
3. Tenders will be accepted without cash deposit from incorporated banks and trust companies _ and from
responsible and recognized dealers in investment securities. Tenders from others must be accompanied by a
deposit of 10 per cent of the face amount of Treasury bills applied for, unless the tenders are accompanied by
an express guaranty of payment by an incorporated bank or trust company.
4. If the language of this form is changed in any respect, which, in the opinion of the Secretary of the
Treasury, is material, the tender may be disregarded.

Payment by credit through War Loan Deposit Account will not be permitted.
Before signing fill in all required spaces.
Bank or Trust Company
Post Office Address.
State
Official signature required.
SPACES BELOW ARE FOR THE USE OF THE FEDERAL RESERVE BANK
Classified

Carded

Examined

Allotment

Received

Figured

Checked

rENTB-441-a




Checked

Ledger

Advised

Recorded

Acknowledged

Method of Payment

Window

Disposition

Amount

Custody

* Price should be expressed on the basis of 100, with not more than
three decimal places, e.g., 99.125. Fractions must not be used.

Date Released

Mail

By

Other Departments

(m4)

FEDERAL RESERVE BANK
OF N E W YORK

December 9, 1938.
NEW J?D DANGEROUS COUNTERFEIT
To Member Banks in the Second Federal
Reserve District and Others Concerned:
In a letter dated December 7, 1938, the Treasury Department, Secret
Service Division, describes a certain new and dangerous counterfeit as follows:
$5 SILVER CERTIFICATE
Series of 1934A; check letter " E M ; face plate No. 621; back plate
No* 810; W. A. Julian, Treasurer of the United States; Henry Morgenthau,Jr«,
Secretary of the Treasury; portrait of Lincoln.
This production is printed on one sheet of good quality paper from
skillfully executed photo-etched plates retouched by hand. A few sparsely
scattered red and blue fibers have been affixed to the paper to simulate
the silk thread in the genuine. In over-all dimension, the counterfeit
is 3/l6th of an inch longer and l/l6th of an inch narrower than the
genuine. The printed front design is about l/8th of an inch longer and
slightly narrower than the genuine. The printed surface on the back is
about 3/l6th of an inch too long.
DEFECTS

(The graphic illustration appearing in the Treasury's letter of
December 7, 1938, is omitted here.)
1. Serial numbers are printed heavily in a distinctive style of type
unlike the genuine and the individual numerals are spaced too widely. The
horizontal lines forming the letter E preceding the serial numbers are
shorter than the genuine, and the perpendicular line is longer. O the
n
letter A imnediately following the serial numbers, the horizontal cross-bar
is too high.
2. The blue Treasury seal is slightly smaller than the genuine and
crudely etched, the lettering and shield design being reproduced raggedly.
The Latin word S P E T is misspelled SEPTENS, Ttie three white stars
ETN
separating the several words outside the shield are irregularly formed as
dots.
3. This counterfeit has appeared with two different serial numbers E75637382A and #56373827A. The highest serial number printed on genuine
notes of this variety and denomination i s #58072000A.




12/9/38

2

(m4)

The Lincoln portrait is well executed. However, the pupil in the
left eye is mere clearly outlined than the right eye, giving the latter
an appearance of weakness. The shaded lines in parallel bordering the
right side of the largo numeral 5 on the loft of the portrait vary in
thickness at the outer edge and show a fino enclosing line which is not
visible in the genuine. On the back, the dark area behind the Memorial
columns has been retouched and the line work inside the oval design
lacks shadow values which distinguish the genuine. The shading above
and below the large white lettering at the bottom of the Memorial has
been retouched by hand.
This is a particularly deceptive counterfeit and you are requested
to notify money handlers to exercise more than ordinary caution in accepting notes of this variety, paying especial attention to the unusual
character of the serial numbers and the misspelled word SEPTMS in the
blue Treasury seal.

The Tteasury Department has requested that any counterfeits which come to
the attention of banks or others be forwarded with all available information to the
office of the United States Secret Service having jurisdiction in their territory.
Offices of the Secret Service are located in .Albany, Buffalo, Syracuse and New York
City, New York, and in Newark, New Jersey.




George L, Harrison,
President.

FEDERAL RESERVE BANK
OF NEW YORK
f
Letter RU.3 T
L December 15,1938 J

Ruling of the Board of Governors of the Federal Reserve System
Regarding Regulation U

To Each Nonmember Bank in the
Second Federal Reserve District:

Further supplementing our letter RU.l dated January 15, 1938,
we quote below the text of a ruling regarding Regulation U of the Board
of Governors of the Federal Reserve System which was published in
the December, 1938, Federal Reserve Bulletin.
(December 1938 Bulletin, p. 1042.)

Maximum Loan Value of Bonds Under Regulation U

Section 1 of Regulation U provides in part that for the purposes
of that regulation the maximum loan value of stocks shall be as specified in the supplement to the regulation and the maximum loan value
of any collateral other than stocks shall be "as determined by the bank
in good faith."
This means, in effect, that for such purposes the maximum loan
value of collateral other than stocks should be the amount which the
bank would customarily lend on such collateral if that were the only
collateral for the loan. Consequently, a bank may not determine that
such other collateral, as for example a bond, has a maximum loan value
equal to its current market value unless the bank would customarily
lend such amount on the collateral without any additional collateral.
It is believed that the regulation is clear on this point, but since it
has developed that there may have been some confusion regarding the
matter, it has seemed desirable to publish the foregoing to remove any
misunderstanding that may have existed in this connection.
Inquiries regarding the regulation should be submitted to this
bank.




GEORGE L. HARRISON,

President.


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102