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THE CAPITAL ISSUES COMMITTEE
OF THE

FEDERAL RESERVE BOARD

By Frederic H. Curtiss
Chairman, Federal Reserve Bank of Boston
and

Chairman of Sub-Committee on Capital ISCL ;S.




Federal Reserve District No. 1.







An address by
Frederic H. Curtiss
before the

City Treasurers and Collectors Association
of Massachusetts
at Boston, March 23, 1918.

OUTLINE OF SPEECH
W H Y THE CAPITAL ISSUES COMMITTEE WAS CREATED.
T H E ENGLISH SYSTEM.
T H E CAPITAL ISSUES COMMITTEE OF THE FEDERAL RESERVE BOARD.

Its organization.
Its function.
The kind of issues it passes upon.
The method of procedure.
Its policy in dealing with securities.
CONCLUSION.




Mr. Toastmaster and Gentlemen:—
I deeply appreciate the opportunity which your President, Mr.
Pike, has given me to address you this afternoon on the subject of
the Capital Issues Committee. It is a great privilege to meet
with you and to have the opportunity of discussing a subject in
which we are all vitally interested at the present time, the conservation of capital and materials.
Why the Capital Issues Committee Was Created
In order to win the war, it is imperative at this time that labor,
materials and credit be placed at the disposal of the Government
in the largest possible measure. Any unnecessary production or
consumption of goods, and any unnecessary use of credit, saps
and weakens the fighting strength of the Nation.
There is no doubt about the willingness of the people of the
United States to meet the Government's requirements generously
and without reserve; but they demand, and are entitled to, guidance
as to which industries and what pursuits are to be considered as
necessary for the best interests of the Country, and, therefore, are
to be stimulated, and which, on the other hand, are to be held as unnecessary, and therefore, to be discouraged under present circumstances.
The problem affects with peculiar force our banking operations,
because credit improperly granted not only wastes savings that
should be made available to the Government, but misdirects at
the same time the use of labor and material which should be devoted
to our National purposes.
To bring about the proper control of credit is, therefore, one of
the foremost endeavors of the nations at war and it is for this
reason that the European belligerent countries have created central
organizations whose duty it is to state authoritatively whether or
not the sale of securities (stocks, bonds or notes) is in the public
interest, and to the end that, either by voluntary agreement or
by act of law, no securities shall be placed on the market except
with the approval of these bodies. It is for this reason that the
Capital Issues Committee of the Federal Reserve Board was created
at the suggestion of Mr. McAdoo, the Secretary of the Treasury.
France, Germany and England have highly organized Committees
similar to the one now sitting in Washington and with much greater
powers. I shall not take your time to describe the French and




5

German Systems, but I think you may be interested in a brief outline of the English system, after which our own has been closely
copied.
The English System
The control of new issues of capital by the English Government
started with the re-opening of the London Stock Exchange, which,
as you know, after being closed from the end of July, 1914, was
re-opened at the beginning of January, 1915, subject to special
conditions and regulations agreed upon between the British Treasury
and the Committee of the London Stock Exchange and later
accepted by the other Stock Exchanges of the United Kingdom.
In accordance with this agreement, the Committee of the London
Exchange bound itself and its members to deal in stocks and shares
subject strictly to the regulations approved by the British Treasury.
These regulations were not statutory, but the penalty of failure
to observe them in any particular was expulsion from the Stock
Exchange of any member found guilty of contravening the regulations.
The particular regulations which dealt with new issues of securities
provided that no dealings should be allowed on the London Stock
Exchange in any securities issued subsequent to the date of these
regulations unless the issuance of such securities had been first
approved by the British Treasury.
A Committee known as "The Capital Issues Committee" was
appointed by the Chancellor of the Exchequer (as the Secretary of
the Treasury is designated in Great Britain) to examine all applications for approval, of new issues and to recommend to the Treasury
whether or not approval should be given to any issue. The original
Committee consisted of Lord St. Aldwyn, who had been Chancellor
of the Exchequer from 1896 to 1902, as chairman; Lord Cunliffe,
Governor of the Bank of England; Sir Thomas Whittaker, M.P.;
Sir Frederick Vanbury, M.P.; Sir George Barnes, Assistant Secretary of the London Board of Trade; and Mr. B. P. Blackett, Secretary who, at the present time, is in Washington as financial
advisor to the British Embassy.
The Committee soon found that applications for permission to
make new issues were being received not merely in regard to
important issues, and issues that might seek a place on the quotation
lists of the Stock Exchange, but also in respect to issues of securities




6

by public and private companies of all sorts, and it decided that
it was desirable as far as possible to prevent any new issue taking
place without Treasury approval, although the penalty of being
unable to obtain dealings on the Stock Exchange was of little or
no consequence in many cases.
There have undoubtedly been a number of new issues put out
by private concerns and small public companies in England, but
owing to the co-operation of the bankers and a large majority of
the brokers and financial houses, generally speaking no new issues
of any importance have been marketed since January 1915, without this Treasury approval and the number of applications dealt
with up to the end of June, 1917, was something like 15,000.
It may be stated broadly, therefore, that after a transition period
covering the year 1915, no new issue of any character, except for
renewal purposes, has been approved by the British Capital Issues
Committee unless for purposes directly connected with the prosecution of the war.
Soon after the Capital Issues Committee was constituted, the
question of Capital expenditures and borrowings by local authorities
in Great Britain came under the consideration of the Committee.
It did not deal in detail with the question of new Capital Expenditures by local authorities, but recommended that the Treasury
take up the question with a view to preventing new capital expenditure as far as possible. The town clerks and treasurers of
most of the large cities were called together at the Treasury, and
it was urged upon them that in order to conserve the capital and
labor of the country for the prosecution of the war, further capital
expenditure by local authorities should be reduced to the minimum.
A circular was drawn up by the British Treasury and issued in
March 1915 informing all local authorities that the sanction of the
Government board would not be given for new capital expenditure
in any cases where such sanction was necessary by law unless the
local authority could prove to the satisfaction of the Treasury that
such expenditure was essential for the prosecution of the war; as
for example:—
1: The extension of electric power plants owned by municipal corporations.
2: Or in the interests of public health.
3: Or the extension of a water supply in cases where there
was a serious danger of shortage.




7

This circular covered capital expenditures by most of the smaller
communities but did not cover capital expenditures on a large scale
by the larger cities, whose authority for such expenditures was
dependent on acts of parliament. In practice, however, pressure
from the Treasury and the local Government board and co-operation
by the Treasurers and town clerks has sufficed, even in respect
t o contracts already let. For instance:—a contract had been
made involving 1,000,000 for the erection of a new County Hall
by the London County Council. Arrangements were made with
the contractors to bring the work to an end for the period of the
war as soon as a stage had been reached where the building could
be left unfinished without wasting the work already done.
As a result, the capital expenditures by local authorities has
ceased except where absolutely necessary for public welfare or for
purposes directly concerned with the conduct of the war, and one
incidental effect has been that considerable sums have accumulated by the local authorities in sinking funds established in
connection with capital expenditure which have become available
for investment in war loans.
Many of you, I recall, have already followed this practice and a
large amount of Liberty Loan Bonds and Treasury Certificates
of Indebtedness are now carried as investments in sinking fund
accounts in this district.
To sum up, the English Committee was a voluntary organization created as a war measure and with no specific law which forced
submission to its regulations; but, as a matter of fact, it acted as
a law because of the splendid co-operation of the Stock Exchanges,
Investment Houses, Bankers and local authorities. This gave the
Committee a very complete control and it has exercised this control
with a strong hand. It worked with the idea that in order to win
the war, it was not only a question of conserving, to the greatest
possible degree, all available credit and the savings of the country,
but also material and labor, and to the end, that all unnecessary
expenditures both private and public, and unnecessary operations
should be restricted.
Let us now follow the development of a committee similar in
character now known as T H E CAPITAL ISSUES COMMITTEE OF THE
FEDERAL RESERVE BOARD.




8

Its Organization
For some months, in the United States, the conviction had been
growing and taking a more definite form that corporate and municipal issues should be controlled in a manner similar to the English
system. Committees formed in several financial centers urged the
Government to take steps along these lines and these became more
insistent as the banks and the public became convinced that there
was no such thing as "unlimited resources" nor was there any such
thing as "business as usual," when, as a matter of fact, business and
financing has been driven into the most unusual channels the world
has ever seen.
Acting upon these urgent pleas, Secretary McAdoo issued a
statement asking all would-be issuers of new securities to communicate with him in order that he might express the point of
view of the Government as to whether or not the issue of such
securities was or was not compatible with the public interest.
This request met with such a hearty and spontaneous response
that he soon found that it was impossible for him fairly and justly
to deal with these cases without creating an effective organization
which could undertake the careful study of each individual case
and judge it upon its own merits.
In a letter dated January 11, 1918, Secretary McAdoo invited
the Federal Reserve Board "as another patriotic service to assume
the responsibility of passing upon such proposals as may be submitted to it with respect to capital expenditure or the issue of new
securities." The Federal Reserve Board acting upon this letter
passed a resolution accepting this charge and appointed three of
its members, the Honorable Paul M. Warburg, Vice-Governor of
the Board, Chairman; Honorable Charles S. Hamlin and the Honorable F. A. Delano, to act as a "Capital Issues Committee" and
authorized this Committee to engage the necessary staff and to
appoint an Executive Advisory Committee to assist it in investigating and passing upon all cases that might come before it.
This new Committee was fortunate in being able to prevail upon
such public spirited and able citizens as Mr. Allen B. Forbes of
New York, a member of the banking firm of Harris, Forbes & Company; Mr. F. H. Goff, President of the Cleveland Trust Company,
and Mr. Henry C. Flower, President of the Fidelity Trust Com-




9

pany of Kansas City, to become members of its Advisory Committee. In addition, it secured the services of Mr. Bradlee W.
Palmer of Boston, an expert on corporation law, to act as its counsel.
The Capital Issues Committee then organized twelve Sub-Committees with head quarters at each of the twelve Federal Reserve
Banks and requested the Chairman of the Board of Directors of
each bank to act as Chairman of the Sub-Committee and the
Governor of the Federal Reserve Bank to act as Vice-Chairman.
Three additional gentlemen representing expert knowledge in
municipal, industrial or public utility financing, constitute, with
the Chairman and Vice-Chairman, the permanent Sub-Committee
in each Federal Reserve District. In addition members were
appointed in each district to serve as alternates to the permanent
committee known as the Auxiliary Sub-Committee.
The permanent New England Committee at present consists of
Frederic H. Curtiss, Chairman of the Federal Reserve Bank, as
Chairman; Charles A. Morss, Governor of the Federal Reserve
Bank, Vice-Chairman; Francis R. Hart, Vice-Chairman of the Old
Colony Trust Company; John E. Oldham of Merrill, Oldham &
Company; Robert Winsor of Kidder, Peabody & Company.
The following gentlemen comprise the Auxiliary Committee:
Charles Francis Adams, Treasurer of Harvard University; Henry
G. Bradlee of Stone & Webster; Philip Cabot of White, Weld &
Co.; Allen Curtis of Curtis & Sanger; Henry B. Day of R. L. Day
& Co.; Allan Forbes, President of the State Street Trust Company;
and James F, Jackson, a prominent attorney at law.
I want to impress upon you that none of these men give advice
or report upon any application in which any of them have a direct
or indirect personal interest, and that they have undertaken their
duties at the request of the Federal Reserve Board as a patriotic
service to the country.
The New England Committee has secured the services of Edward
H. Kittredge as Secretary. Mr. Kittredge was formerly Manager
of the Statistical Department of the Old Colony Trust Company
and is conversant with the character of the information which
the Committee needs for its investigations.
The Central Committee at Washington and the Sub-Committees
have been at work now a little over a month and have received the
hearty co-operation of Corporation Executives, Municipal Officers,




10

Bankers and Brokers, Boards of Trade and Stock Exchange Organizations in all sections of the Country.
Most of you received from me not long ago copies of the resolutions of the League of Kansas Municipalities expressing a hearty
desire to co-operate with the Capital Issues Committee and outlining
several different recommendations which are being carried out by
the Cities and Towns of that State. The American Bankers
Association, The Investment Bankers Association of America,
the New York and Boston Stock Exchanges, the Richmond Real
Estate Exchange, the Chamber of Commerce of Boston, Mayor
Peters of Boston in his recent inaugural address, and countless
others, all acknowledge the importance and necessity of the work
of this Committee and have signified their intention to co-operate
in its work.
The resolution of the New York Stock Exchange reads as follows:
"Resolved^ That the Committee on stock lists will require
as a condition to the listing of such new capital issues the
presentation of the approval of such committee of the Federal
Reserve Board."
That of the Board of Governors of the Investment Bankers
Association of America:
"Resolved: That the Board of Governors of this association
heartily endorses the plan for the supervision of capital issues
in operation and further heartily endorses the general purpose
of the War Finance Corporation Bill as being consistent
with and furthering the mobilization and conservation of
capital for the purpose of winning the war."
"Resolved: That it is the sense of this board that no member
of this Association should buy or sell or offer for sale except
subject to the final approval of the Capital Issues Committee,
any securities which come within the scope of the Capital
Issues Committee regulations unless the issuance of such
securities first shall have been approved by that Committee."
The resolution of the American Bankers Association:
"Whereas, the Federal Reserve Board has named Mr.
Warburg, Mr. Delano and Mr. Hamlin on a Committee to
be known as the Capital Issues Committee, now, therefore,
Be it Resolved, that we, the administrative Committee of
the American Bankers Association, are in full accord with
this movement and give it a hearty and unqualified support
and further, that we r< commend to the members of the American
Bankers Association that they also extend their hearty support
in carrying out the purposes for which the Capital Issues
Committee was appointed."




11

I think you will agree with me that these are strong resolutions
and will have a very far-reaching effect.
As you doubtless know, the Governor of the Commonwealth
addressed a letter to Mr. Endicott, Executive Manager of the
Committee of Public Safety, urging him to get in touch with the
proper authorities in every City and Town to the end that they
impress upon the Towns the necessity of appropriating the smallest
possible amount of money for administration purposes and that
they explain to them the great need of rigid economy and the curtailment of proposed improvements. The town warrants of many
towns reflect the influence of the Governor's suggestion.
The Governor of the State of Vermont, through the Vermont
Committee on Public Safety, addressed letters to the moderators
and selectmen of every town and to the Mayors of all the Cities,
requesting that, in every town where financial meetings were held,
time be taken to consider the important questions involved in the
World War into which this country had been drawn.
In the town meetings held throughout New Hampshire recently,
a proclamation was read, also a message from the New Hampshire
Committee on Public Safety, dealing with the war and the need of
economy and thrift at the present time. In many towns, patriotic
speeches were made and resolutions were drawn up.
The Governor of Maine has informed me that at a meeting of
the selectmen of the towns of Maine, at which more than three
hundred towns were represented, the question of economy in municipal expenditures and the curtailment of unnecessary work was
discussed, and the general disposition among the towns in Maine
was to be conservative in making appropriations for the duration
of the war.
Thus you will see that the co-operation which The Capital Issues
Committee is receiving is not confined to any one group or district
but extends through states, cities, corporations, bankers and business
organizations of every character.
Its Function
Like the Eng ish Committee, the function of the Capital Issues
Committee is to pass upon offerings for sale of stock, bonds and
notes and in so doing, it only examines into two questions:—
1: Whether the offer is timely with respect to the financial
operations to be undertaken by the Government from time
to time, and




12

2: Whether the objects for which the funds are to be raised
by the offer of securities are compatible with the public interest.
The Committee is in no sense interested nor will it pass upon the
intrinsic merit of securities to be offered for sale.
The Kind of Issues It Passes Upon
The issues which should be referred to the Capital Issues Committee may properly be sub-divided into three classes:—
1: State and Municipal Issues.
2: Public Utility Issues.
3: General Industrial Issues.
Mr. McAdoo, as Director General of Railroads, has undertaken
to pass upon all issues covering the financing of railroads and railroad construction.
Because of the vast number of issues which might be presented
to the Committee for its approval, it has been forced to place a
limit on the par value amount of issues upon which it will give an
opinion. The limit placed on Public Utility and Industrial issues
is $500,000 and the Umit on State and Municipal issues is now
$100,000 (having been reduced from $250,000 to $100,000 on
February 23d, last).
The question of reducing the limit on corporation issues is under
discussion at the present time and it is expected that it will be reduced to $100,000 in the near future.1
Another important point and one which is of special interest to
you is the fact that the Capital Issues Committee has ruled that it
will not pass upon bond or note issues which mature in less than
one year. This excludes notes of municipalities issued in anticipation of taxes from the category of issues which this Committee
will pass upon.
The Method of Procedure
I want to say just a word about the manner in which these Committees conduct their work. No doubt you have seen the letter of
instructions2 which the Capital Issues Committee has prepared for
applicants and with respect to proposed issues of bonds, notes and
issues of stock. These instructions should be followed carefully
1. The War Finance Act of April 6, 1918, provides for this reduction.
2. See appendix for copy of this letter of instructions.
13




inasmuch as they outline the character of information which should
accompany each application to the Committee.
The Central Committee at Washington has requested that all
applications should be addressed to it at 718 Metropolitan Bank
Building, Washington, D. C , but that all applications with all the
requested data should be made in duplicate and filed with the
Secretary of the Sub-Committee of each Federal Reserve District;
one copy being retained by the Sub-Committee and the other
being sent to the Capital Issues Committee when completed.
The Central Committee at Washington generally can pass at
once on an application which is accompanied by full details, and
where the character of the expenditure is clearly marked. In
doubtful cases, however, the applications are referred back to the
local Sub-Committee for its recommendation, and the exhibits
are reviewed by that Committee.
In order that the procedure may be carried forward without
unnecessary delay, each member of the Permanent Sub-Committee
is kept informed of all applications forwarded to Washington. In
this way, the Sub-Committee is ready to formulate a recommendation when required and without undo delay.
The Committee appreciates how important prompt action is to
the applicant and I can assure you that the process of getting an
application acted upon is usually a matter of a few days; about
four on the average. On the other hand, I urge upon those of you
who may have occasion to present financial projects for approval,
that you do not wait until the last moment before sending in
your application and the required exhibits, but that you allow
the Committee as much time as possible, because it is asked to
pass upon a vast number of applications coming from all sections
of the country.
Its Policy in Dealing With Securities
The Central Committee at Washington is guided in its deliberation by the thought that only by subordinating local and personal
interests to the public welfare and by enforcing the most rigid
economy in matters of personal and private expenditures, can
the United States hope to bear its part of the financial burden of
the war and to release sufficient labor and material for war purposes
without depletion of our own resources. From this point of view,
the Committee has adopted as its policy that during the period




14

of the war, favorable action should be taken only where state,
county, municipal, corporation or individual financing involve
projects which will contribute to the prosecution of the war or
which are essential to the public health and welfare.
While the Central Committee reserves the right to deal with
each individual case on its own merits, it may be said that the
Committee
will consider favorably applications submitted involving the
refunding of maturing applications;
will consider favorably applications submitted involving
the funding of Capital Expenditure incurred prior to February
1, 1918; provided, however, that the Central Committee may
deviate from this policy if available cash assets reasonably
may be used for the payment of such debts in whole or in
part, or excessive cash distributions to shareholders are contemplated, or in cases where the requirements of the corporation may be met in some manner without undue risk or
hardship.
Do not misunderstand this to mean that funding of banking
indebtedness incurred after February 1, 1918, will not be permitted.
Close investigation may establish cases where such funding may
be proper. What is to be avoided, however, is that those intending
to apply for permission to issue securities should not first run
into debt, conceivably for purposes not compatible with public
interests, and then ask for permission to fund the banking indebtedness already incurred.
As regards the issue of new securities the Committee's policy
will be that the sale ought to be considered favorably where the
purpose of the financing will bring results within the calendar
year of 1918. Exceptions will be granted where, as a matter of
Military or economic protection, work ought to be undertaken
extending over the year 1918, or where so much money has already
been invested that the amount necessary to complete the work
may be considered as insignificant as compared with the money
already hazarded in the undertaking; namely, projects involving
the construction of electric power or other similar projects.
As to the construction of new roads, drainage and irrigation
projects, the view is held that only such construction should be
undertaken at this time as is of great strategic or economic import-




15

ance and especially only such as promise to produce results within
the year 1918.
In dealing with State and Municipal expenditures, the decisive
factor in the deliberations of the Committee has been, whether
or not the expenditure is absolutely necessary for the health and
welfare of the community, and the Committee urges that the
public authorities, both State and Municipal, approve appropriations only where urgently required by the health and welfare of
the people.
As regards building operations, Secretary McAdoo has said,
"Home building is an excellent thing in normal times, but at
present, unless there is a real shortage of houses for war workers,
I strongly advise t h a t materials, valuable labor, and credit be
not utilized for these purposes." The Capit&l Issues Committee
feels that it would be unwise and impracticable to attempt to
restrict entirely the building of homes in communities where the
population is rapidly increasing, but that it is justified in attempting
to restrict building operations in communities where the growth is
normal, even though some inconvenience and discomfort results.
Everyone is asked to practice self-denial and sacrifice to the extent
of deferring building operations which are not essential for public
health or public welfare.
I t is needless to say that the local Committees are exerting
their utmost efforts to spread this gospel in their districts, and
I might add that they have received the heartiest co-operation
on all sides and that many unnecessary building projects, such
as the construction of churches, grade schools, industrial buildings,
etc., have been postponed as the result. I have no doubt that
as we go along and as an understanding of the extent of our National
requirements spreads, we will have no difficulty in securing the
fullest co-operation from all.
Conclusion
In conclusion, let me make it clear that the operations of the
Capital Issues Committee are confined to new issues of securities
offered for public sale, and that in every case the Committee is
most anxious to reach a fair and just conclusion, and that it counts
upon the co-operation of every individual, corporation, and municipality to bring about these results.




16

I want also to make clear the fact that individuals who finance
themselves in the regular course of business without applying
to the investment market by the public sale of securities in amounts
in excess of the limits described, do not come within the purview
of the operations of the Committee.
I trust, too, that I have left with you the conception that this
Committee is working, in a constructive way, to bring about a
proper control of credit and to keep the financial channels clear
for the big task which the Government has undertaken; namely,
to bring this war to a swift and successful conclusion.
Finally, I want to emphasize what, to my mind, is the most
important thing of all. It is unnecessary for me to ask you gentlemen to co-operate with us in reducing municipal expenditures
to the lowest possible volume, for I know that you all can be
counted upon to do that; BUT I DO WANT YOU TO SPREAD
THE GOSPEL OF SAVING AND ECONOMY, and to preach
the doctrine of reducing all capital expenditures, both private
and public, in your different localities.
We desire to eliminate expenditures of every character that can
be postponed until after the war. It makes no difference whether
it is for a new town hall, an unnecessary road, a church, a school,
or a private dwelling. ALL THESE CAN WAIT; BUT OUR
ARMY, AND THE ARMIES OF OUR ALLIES, CANNOT
WAIT. Those who are fighting for us on the battle lines need
food, clothing and ammunition, and our Government needs ships
and vast quantities of supplies and materials, and above all, skilled
and unskilled labor. These needs are vital and delay means disaster. We must not, therefore, compete with the Government
for any of these things, or hinder it from getting whatever it needs.
We must get away from the idea that the war is going to end
this summer, or even next summer. No one knows when it will
end, and I am betraying no confidence when I tell you that Washington is preparing for several years of war. The thought that
we as individuals, or as communities, will be spared making the
large sacrifices which England and the other belligerent countries




17

are cheerfully making, and that peace with a return of normal
activities is but a few months off, is to my mind the most insidious
German propaganda that the country has been forced to deal with.
There can be no doubt that every patriotic citizen is willing to
give his all to help this country in her hour of need, just as our
brave boys are ready to give their lives for the same reason "over
there," but we must come to the realization of how great and
pressing are its .needs at the present moment.




18

APPENDIX

CAPITAL ISSUES COMMITTEE
OF

FEDERAL

THE

RESERVE

BOARD

WASHINGTON

INSTRUCTIONS TO APPLICANTS WITH RESPECT
PROPOSED ISSUES OF BONDS, NOTES,
SHARES OF STOCK, ETC.

TO

February 21, 1918.
Applications should be addressed to the Capital Issues Committee, 718 Metropolitan Bank Building, Washington, D. C.
No prescribed form of application is required, but the applicant
should provide all the information which is appropriate to the
proposed issue, or which would facilitate the speedy decision of the
Committee. For the guidance of applicants the following suggestions are made:—
The purpose of the issue should be fully and accurately
described.
If the purpose is to refund, fund, or pay or extend outstanding bonds, obligations, or indebtedness, describe fully the
nature and character of bonds, etc., to be refunded and state
briefly the time or times and the general purposes for which
unsecured indebtedness was incurred.
If the issue is to be made for war purposes or to raise capital
in connection with war contracts or war supplies, or to provide
equipment, buildings, or facilities of any kind for war work,
full description thereof and amounts needed therefor should
be stated.
If any war purposes are involved, reference should be made
to the proper governmental authorities at Washington and
elsewhere to enable definite information and corroboration to be
obtained directly by the Committee.
If the issue is deemed necessary on account of any governmental requirement, National, State, or municipal, or of any
commission or public authority, describe the same in full.




i

If the issue is deemed necessary for reasons of public health
or welfare, or other public economic necessity, describe the
same in full.
If the issue is made for private financial requirements and
no public interests are involved, a very clear exposition of
necessity will be desired.
In all cases full reasons should be given why the proposed
issues can not be postponed until after the war, or why the
necessity is greater than the paramount need of the National
Government in conserving the financial resources, materials,
and labor of the country for the war.
It will be necessary to identify the issues accurately before a
final opinion is expressed. For that purpose the following information, when appropriate, should be furnished:—
WITH REGARD TO PROPOSED ISSUES OF BONDS, NOTES, CERTIFICATES OF INDEBTEDNESS, AND OTHER SECURITIES
(STATE, COUNTY, MUNICIPAL, OR CORPORATE).

1. Name, amount, date, and dates of maturity, and serial
numbers of the proposed bonds, notes, or other securities.
2. Amount of total authorized issue of which proposed issue
is part.
3. Attested copies of votes, ordinances, or resolutions authorizing proposed issue.
4. Attested copy of mortgage, deed of trust, or similar instrument under which proposed issue is made or by which
it is to be secured.
5. Last balance sheet if a corporation and copy of charter
and by-laws, if in print.
WITH REGARD TO PROPOSED ISSUES OF SHARES OF STOCK

1. Total capitalization of company.
2. Last balance sheet and copy of charter and by-laws, if
in print.
3. Total authorized issue of stock of which proposed issue
is part.
4. Amount of proposed issue, method and dates of issue,
whether by offer to shareholders, sale, or public subscription.
5. Attested copies of votes authorizing proposed issue.




ii

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