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FEDERAL RE SE R V E BANK O F N EW YO RK J"Circular No. 3 8 8 6 T L A ugust 14, 1952 J Fiscal A gent o f the United States Offering of $1,300,000,000 of 91-Day Treasury Bills Dated August 21, 1952 Maturing November 20, 1952 To all Incorporated Banks and Trust Companies, and Others Concerned, in the Second Federal Reserve D istrict: F ollow in g is the text o f a notice published today : F O R R E L E A S E , M O R N IN G N E W S P A P E R S , T h u rsd a y, A u gu st 14, 1952. TREASU RY DEPARTM ENT W ash ington T h e S ecretary o f the Treasury, b y this public notice, invites tenders fo r $1,300,000,000, or thereabouts, o f 91-d a y Treasu ry bills, fo r cash and in exch ange fo r T reasu ry bills m aturing A u gu st 21, 1952, in the am ount o f $1,303,390,000, to be issued on a discou n t basis under com petitive and n on -com p etitive b id d in g as h ereinafter provided . T h e bills o f this series w ill be dated A u gu st 21, 1952, and w ill mature N ovem ber 20, 1952, w hen the face am ount w ill be payable w ith ou t interest. T h ey w ill be issued in bearer form only, and in denom inations o f $1,000, $5,000, $10,000, $100,000, $500,000, and $1,000,000 (m aturity valu e). T en ders w ill be received at F ed eral R eserve Banks and Branches up to the clo s in g hour, tw o o ’c lo ck p.m., Eastern D ayligh t S avin g time, M on day, A u gu st 18, 1952. T en ders w ill n ot be received at the T reasu ry D epartm ent, W a sh in gton . E ach tender must be fo r an even m ultiple o f $1,000, and in the case o f com petitive tenders the price offered m ust be expressed on the basis o f 100, w ith not m ore than three decim als, e.g., 99.925. F raction s m ay not be used. It is urged that tenders be m ade o n the printed form s and forw a rd ed in the special en velopes w hich w ill be supplied by F ed eral R eserve Banks o r Branches on application th erefor. O thers than banking institutions w ill not be perm itted to subm it tenders excep t fo r their ow n account. T en ders w ill be received w ithout deposit from in corporated banks and trust com panies and from responsible and recogn ized dealers in in vestm ent securities. T en ders from others m ust be accom panied by paym ent o f 2 percent o f the fa ce am ount o f T rea su ry bills applied fo r, unless the tenders are accom panied b y an express guaranty o f paym ent by an in corporated bank o r trust com pany. Im m ediately after the clo s in g hour, tenders w ill be opened at the F ed eral R eserve Banks and B ranches, fo llo w in g w hich pu blic announcem ent w ill be m ade by the S ecretary o f the T rea su ry o f the am ou nt and price range o f a ccepted bids. T h ose subm itting tenders w ill be advised o f the acceptance o r rejection th ereof. T h e Secretary o f the T reasu ry exp ressly reserves the right to accep t o r reject any or all tenders, in w h ole or in part, and his action in any such respect shall be final. S ubject to these reservations, non-com p etitive tenders fo r $200,000 o r less w ithout stated price from any one b idd er w ill be accepted in fu ll at the a vera ge price (in three decim a ls) o f accepted com petitive bids. Settlem ent fo r accepted tenders in a ccordance w ith the bids m ust be made or com pleted at the Federal R eserve Bank on A u gust 21, 1952, in cash o r other im m ediately available funds o r in a like face am ount o f T reasu ry bills m aturing A u gust 21, 1952. Cash and exch a n ge tenders w ill receive equal treatment. Cash adjustm ents w ill be made fo r differences between the par value o f m aturing bills a ccepted in exch an ge and the issue price o f the new bills. T h e incom e derived from T reasu ry bills, w hether interest or gain from the sale o r other disp osition o f the bills, shall not have any exem ption, as such, and loss from the sale o r oth er disp osition o f T reasu ry bills shall n ot have any special treatm ent, as such, under the Internal Revenue C ode, o r law s am endatory o r supplem entary thereto. T h e bills shall be subject to estate, inheritance, gift, or oth er e x cis e taxes, w hether Federal or State, but shall be exem pt fro m a ll taxation n ow o r hereafter im posed on the principal or interest th ereof by any State, o r any o f the possessions o f the U nited States, o r b y any loca l ta x in g authority. F o r purposes o f taxation the am ount o f discou nt at w hich T reasu ry bills are origin a lly so ld b y the U nited States shall be con sidered to be interest. U nder S ections 42 and 1 1 7 (a )(1 ) o f the Internal Revenue C ode, as am ended by S ection 115 o f the Revenue A c t o f 1941, the am ount o f discou nt at w hich bills issued h ereunder are s o ld shall n ot be con sidered to accru e until such bills shall be sold, redeem ed o r otherw ise disp osed o f, and such bills are exclu ded from con sideration as capital assets. A cco r d in g ly , the ow ner o f T reasu ry bills (oth er than life insurance co m pan ies) issued hereunder need include in his incom e ta x return on ly the difference betw een the price paid fo r such bills, w hether on o rigin a l issue o r on subsequent purchase, and the am ount actually received either upon sale o r redem ption at m aturity du rin g the taxable year fo r w hich the return is m ade, as ord in a ry gain or loss. T reasu ry D epartm ent C ircu lar N o. 418, as am ended, and this notice, prescribe the terms o f the T reasu ry bills and govern the con ditions o f their issue. Copies o f the circu la r m ay be obtained from any F ed eral R eserve Bank o r Branch. This bank will receive tenders up to 2 p.m., Eastern Daylight Saving time, Monday, August 18, 1952, at the Securities Department o f its Head Office and at its Buffalo Branch. Please use the form on the reverse side o f this circular to submit a tender, and return it in an envelope marked “ Tender fo r Treasury Bills.” Tenders may be submitted by telegraph, subject to written confirmation; they may not be submitted by telephone. Payment for the Treasury bills cannot be made by credit through the Treasury T ax and Loan Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. A l l a n S p r o u l , President. Results of last offering of Treasury bills (91-day bills dated August 14, 1952, maturing N o v e m b e r 13, 1952) T ota l applied f o r .........$2,336,776,000 T o ta l a c c e p t e d ............. $1,500,559,000 (in clu des $215,969,000 entered on a n on-com petitive basis and accepted in full at the a ver age price show n b elow ) A v e ra g e p r ic e ........... 99.519 E quivalent rate o f discou nt app rox. 1.903% per annum R a n ge o f accepted com petitive b id s : H ig h ........................... 99.540 Equivalent rate o f discount approx. 1.820% per annum L o w ............................. 99.514 Equivalent rate o f discount approx. 1.923% per annum Federal Reserve District Total Applied for . $ . $2,336,776,000 N ew Y o rk ................... P h iladelphia ............... Cleveland ..................... R ich m on d ..................... C h ica go ......................... St. L o u i s ....................... M inneapolis ................. K ansas C i t y ................. San F r a n c i s c o ............. 32,634,000 1,618,917,000 41,162,000 53,611,000 31,604,000 30,023,000 251,497,000 43,738,000 18,771,000 63,808,000 52,275,000 98,736,000 (70 percent o f the am ount b id fo r at the low p rice w as accepted) T otal ........................... Total Accepted $ 24,334,000 917,642,000 31,162,000 53,611,000 29,104,000 29,598,000 182,610,000 32,858,000 16,771,000 61,258,000 49,075,000 72,536,000 $1,500,559,000 ( oveb) IMPORTANT— If you desire to bid on a competitive basis, fill in rate per 100 and maturity value in paragraph headed “ Competitive Bid.” If you desire to bid on a non-competitive basis, fill in only the maturity value in paragraph headed “Non-competitive Bid.” DO NOT fill in both paragraphs on one form. A separate tender must be used for each bid, except that banks submitting bids on a competitive basis for their own and their customers’ accounts may submit one tender for the total amount bid at each price, provided a list is attached showing the name of each bidder, the amount bid for his account, and method of payment. Forms for this purpose will be furnished upon request. N o............................ T E N D E R FOR 91-D A Y T R E A S U R Y BILLS Dated August 21, 1952 Maturing November 20, 1952 Dated a t ....................... T o F ed eral R eserve B a n k of N e w Y o r k , Fiscal A gent of the United States. 1952 COMPETITIVE BID NON-COMPETITIVE BID Pursuant to the provisions o f Treasury Department Circular N o. 418, as amended, and to the provisions o f the public notice on August 14, 1952, as issued by the Secretary o f the Treasury, the undersigned offers Pursuant to the provisions o f Treasury De partment Circular No. 418, as amended, and to the provisions o f the public notice on A ugust 14, 1952, as issued by the Secretary o f the Treasury, the undersigned offers a non-com petitive tender ............................................ * fo r a total amount of for a total amount o f $. (Not to exceed $200,000) (Rate per 100) $ ....................................................... (maturity value) o f the Treasury bills therein described, or for any less amount that may be awarded, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated below : (m aturity value) o f the Treasury bills therein described, at the average price (in three deci mals) o f accepted com petitive bids, settlement therefor to be made at your Bank, on the date stated in the public notice, as indicated b e lo w : □ □ By surrender o f maturing Treasury bills By surrender o f maturing Treasury bills amounting t o ................... $----------------------------------- amounting t o ...................$_______________________ □ □ By cash or other immediately available funds By cash or other immediately available funds * Price must be expressed on the basis of 100, with not more than three decimal places, for example, 99.925. The Treasury bills for which tender is hereby made are to be dated August 21, 1952, and are to mature on N ovem ber 20, 1952. This tender will be inserted in special envelope marked " Tender for Treasury Bills." N am e o f B idder By ----- (Please print) (Official signature required) (Title) Street A d d ress ............................................ (City. Town or Village, P. O. No., and State) I f th is te n d e r is su b m itte d b y a b a n k f o r th e a c c o u n t o f a c u s to m e r , in d ic a t e th e c u s t o m e r ’s n a m e o n lin e b e lo w : (Name of Customer) (City, Town or Village, P. O. No., and State) IMPORTANT INSTRUCTIONS: 1. N o tender fo r less $1,000 (m atu rity va lu e). than $1,000 w ill be con sid ered , and each ten der must be fo r an even m ultiple o f 2. I f the person m aking the tender is a corp ora tion , the tender should be sign ed b y an officer o f the corp ora tion authorized to m ake the tender, and the sign in g o f the tender b y an officer o f the corp ora tion w ill be construed as a rep resentation by him that he has been s o authorized. I f the ten der is m ade b y a partnership, it should be signed b y a m em b er o f the firm, w ho should sign in the form “ ............................................................................................................... . a copartn ersh ip, by ....................................................................................................................... a m em ber o f the firm .” 3. T en ders w ill be received w ith ou t deposit from in corpora ted banks and trust com panies and from respon sible and recogn ized dealers in investm ent securities. T en ders from others m ust be accom panied by paym ent o f 2 percent o f the fa ce am ount o f T reasu ry bills applied for, unless the tenders are accom pa n ied by an express guaranty o f paym ent by an in corpora ted bank o r trust com pany. 4. I f the language o f this tender is changed in any respect, w hich, in the opin ion o f the S ecretary o f the T reasu ry, is m aterial, the tender m ay be disregarded. Payment by credit through Treasury Tax and Loan Account will not be permitted. http://fraser.stlouisfed.org/ rB—1155-a Federal Reserve Bank of St. Louis ( ovek)