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Index t o Joint Conference
Record,
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
M
a
r
c
h
1923,
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Federal Reserve Bank of St. Louis
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Federal Reserve Bank of St. Louis
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Federal Reserve Bank of St. Louis
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Federal Reserve Bank of St. Louis
secretary's Minutes
G O V E R N O R S
C O N F E R E N C E
March 2 6 — 29, 1923
Washington, D . C .
CROSS REFERENCE INDEX T C
SECRETARY'S MINUTES A N D STENOGRAPHIC RECORD
MARCH 2 6 - 29, 1923 CONFHRENCE O F GOVERNORS
Program
and
Topic
Absentees f r o m Conference . . .
+. . s s »
Paragraphs i n
Secretary's
Minutes
7
Pages i n
Stenographic
Report
8-9 ;100+101
Accounting - Committee o n Standardization
PONE. e e e e e e e e te
Acting Chairman 4
«+ 6
>
ABVGNE Gocketery m e i . s e
Adjustment o f country member banks reserve
accounts for currency i n transit . . . -
536-541
AGvECe S r 0 . Meturns
181-192
6 .
O N We
e e
e S
Advising payment o r non-payment o n cash o r
OOL L e e s e A w e
a e 6
c a e e e e
173-175
Agricultural Credits Act o f 1923 - Changes
in Regulations o f Federal Reserve Board
Joint :Conf. Rec.
ne¢essitated b y .» . «6 6 «
Agricultural Paper - Limitation o n aggregate
amount w h i c h m a y b e rediscounted b y
Federal Reserve Banks < 6 6 0 6 % 3
Air Service -
Joint Conf. Rec.
e e e w8
481-484
Speeding u p collections v i a . .-
American Bankers Association ~ Telegram r e
Member bank services
6 6 4 .
e e ele
451-453
recent .
570-571
Amendments t o Federal Reserve A c t -
Amendments t o Regulations o f Federal Reserve
Board d u e t o passage o f Agricultural ¢
DVBAEC O AGL. O F DUES e e e S e e e elec e
Automatic Adjustment o f Rates o f Discount . .
Balances required o f nonmember banks using
collection facilities . « 5 5 s + « + >
60
1 7 ,
x3
563
"Borrower" - Interpretation o f i n Section
Call Loan Market (New York) + Importance;
operation « 6 ° .
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Federal Reserve Bank of St. Louis
31-60; 322-325;
Joint Conf. Rec.
30
316-321
20hh
192-195
,6;822
94
15
126-127
Blanket Guaranty covering indorsement o n
direct sendings ..-+-s. -
Joint Conf. Rec.
139-140
1
Paragraphs i n
Secretary's
Minutes
Campbell, Milo D. death of .
Cash letters +
Presentation ©
2,6
hand
. . .
35
Pages i n
Stenographnic
Report
4,7
| 354-361
Checking against “Special Savings" Deposits;
Reserves t o be maintained . . 2.9... ,
Joint C o n f .Rec.
Checks (country) - direct sending . .
346-353
Checks lost i n transit - large volume
311<315
Circulating fitness o f Federal Reserve
Notes Standardization o f . . . . .
Circulation - Tax on; advantage over
Government participation i n profits
Collections
Goupons, a n d other non-cash items
370-377
. .
In Cities where n o par remitting bank
PGP UULeGOtaOne
| 361-367
f i g cee eo pale
t a e
Report o f Standing Committee o n
Via Air service for speed . . .
o s
S o e
Committees
Committee o n Centralized Execution o f
Purchases a n d Sales o f Government
D O C U0LO8I 4 6 k ) S e w k c e e o w e
344-346
177-181
325=+343
151-195
481-484
11-26,
Joint Conf .Rec.
Committee o n Economy a n d Efficiency
Federal Reserve Bank representative o n
548+549,
Bond Commityve@ 4
Joint C o n f .Rec.
4
e e ,
S e
e e
Committee o n Standardization o f Accounting
SOYME e S Bo a e e e e e e e
e e ee e e
533-534
Insurance: Committee. .
os ee e2ie s e
381-451
2 «--
484-511,
512-515
Leased W i r e Committee .
Open Market Investment Com. f o r
F, R. System . .
Joint Conf .Rec.
Pension Committee .
550-570
. . + +--+ s
Standing Committee o n Collections
. .
Standing Committee o n Open Market Conditions a n d Operations . . . .
+ +
151-195
2631
Country Checks ~ direct sending o f . . .
346~353
Goupon Gollections,
344+346
a n d other non-cash items
Credit Statements o f Holding Corporations .
https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis
140-151, 529-532
Pages i n
Paragraphs i n
Steno graphic
Secretary's
Minutes
ao
Currency designs »~ new
Deferred Time Schedules +
Inter-district .
Demand certificates o f deposit -
OF Mame line
e o ga 4
method
175-177
ae e t e e T e ce
Depocit o f till money a t close o f business b y
member banke i n Reserve B a n k Cities - @ * «
36 F-20
34
Direct Sendings o f country checks b y members.
Discounte
' Automatic Adjustment o f Ratec .
ii; caetame
els e o n s
Eligibility for discount o f sign drafts
with B/L a t t a c h e d . . . . 5.
Open Markot Raters ... 0 s e s
16
Les 31,63
12
13
Precent discount rates . . .
Rebatee o f discount . . . .
UME TOP V A C B e S e i w « l a a
ii.
Economy a n d Efficiency ~ Operating repregentative o f Federal Reserve Banke o n
Board Committee
548 --549
Eligibility o f Sight Drafts with Bill o f
Ladine attached) s s 4 v e e 6 8 e e e e
127
542--547
eo
Evening Mecting a t Metropolitan Club. . . .
.«
Examinations o f National Banks - ~ payment for.
Federal Farm Loan Board; meeting with . . - «
Federal Land Banks ~ Reimbursement f o r e x
penses incurred for b y Federal Recorve
Pete
b o et a a
ake
e l 8
Federal Reserve Notes -
O
E
S e
e e
e w e
Recent amendments t o .
Final Fate of chetks; advice of (see advice
of mo feturne) . 2 es e a e e e e e e
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Federal Reserve Bank of St. Louis
4
453458
4:9-10 ;1Q1-102;
232-284
534-535
etandardization o f
circulating fitness o f « s+. e e w e e v e
Federal Reserve A c t -
3 1 - 322-325;
6 0
;
Joint Conf.
Ler
31--60 5322-325
Joint Conf, Rec.
61--100 ;
16218852571
3 1 + 3224385;
6 0
+
Joing Conf. Rec.
175177
Drafte ~ method o f handling ... . . 2. «ss
Employee Insurance . . « «© « © s © 46 6
31,63
346-353
361367
570-571
181-192
Program Paragraphs i n
and
Topic
Secretary's
Minutes
Pages i n
Steno graphic
Report
Pitnees o f circulating Federal Reserve Notes
Stemndardization o f sie v e a 0 2 t e e s «fp L I T A
3€1--367
Franchise T a x ~ Advantage o f substituting
tax or. @ireylation fot... o w s a e 8 esas
370 377
Government Participation i n Profite (franONTEG
F E R S
oi hie.
e e 0
O o
e e ,
bate 8
Se
370 +377
,..
210+215
Tovernment Securities
Checking redeemed securities against
separate registered m a i l advices.
Non-acceptance matured Government s e -
curitiee o n account original issues
Treasury Certificates o f Indebtedness
OF NOLS, “She 6 OW Se. e e s » 8 . 2 .
216-229
«
Purchases and Salee (report of committee).
11--26; Appendix
Joint Conf. Rec.
Guaranty o f Prior Indorsements.
169-173
...
Hand presentation o f Cash letters. .
. . » «
Holding Corporatione ~ Credit statements of,
Indorsements
Blanket guaranty o n direct sendings . . .
Guaranty o f prior indorsements .
. . «=;
Liability i n making unqualified indorsements o n checke received f o r collection.
Uniformity o f o n cash a n d collection items
received f r o m other Federal Reserve Banke
Insurance
Employe@se .
354-361
140-151, 529-532
192-195, 286294
169-173
169-173
295-298
542-547
381-416
+ « «
Report o f Committee
Inter-dietrict deferred t i m e schedules. .
.
Interpretation o f work "Borrower" Section 1 3
Leased W i r e -
Report o f Committee
Legiclation «
e « «© + +
« 6 ¢*#
s e ©
. . . . .
©
+
©
s
299.311
126-127
484+511, 512-515
570-571
Liability Clauses i n Collection Circulars .
151-169
Liability o f Federal Reserve Banks for se~
curities accepted for safekeeping . . . .
127139
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Federal Reserve Bank of St. Louis
Program
Paragraphs i n
and
Secretary's
Minutes
Topic
Pages
in
Stenographic
Report
Liability o f Federal Reserve Banks i n making
unqualified indersements c n checks reeeived for collection « « s s « 6 e 0 2 8 »
169-173
Lostchecks. » in transit 2 s 6 6 s + t e ess
3LieslS
Matured Government Securities -
Undesirabil-
ity of accepting o n account criginal issues Treasury Certificates
o f Indebtedness
24
216-229
Naticmal Banks - Payment for reports o f
POBMEM ALLO O f o w wow e e e e O e e e
4)
453-458
New Curvency Gest ers ss) se ace e e s
Ae
229-231
18
139-140
20
177-181
20
181-192
B
20
344-346
177-181
20
173-175
Nonemember clearing banks ~ balances required
30
316-321
Nenemembership i n System - Causes . . 6 + «
oT
S71
42
458-481
10
26+31
Ov N O C G G
f k ees
a e
O e oS be
A e
e e
wea
New York Call Loan Market - Importance;
ONCE SACS B e a e e R e 0 Se o k ee
Notes and drafts - Collection of in cities
where n o par remitting bank .
- + - « «
Nc Returns - Advice of.
Nonecash collecticns
Coupons,
Stl.
s s
e e 8
e e w s bie 8
In cities where no par remitting bank
Nom-payment,
c r payment -
Officers Salaries -
Advice c f » - . .
-«
Principles w h i c h should
Control: fixing o f s e e sece 6 Foes e e e
Open Market Conditicns a n d Operaticns Report
OF.
C o m m
ttee:
e s a
6 : « t e e
w e e s
Open Market Investment Com. for F.R~ System
62
Open Market Operations. « «© « + « © « ws «es
46
Open Market Rates...
« + 2 « e# e s
11,31 ,63
Jcint Conf -Rec.-
515-520
31-60 ,322-325,
Joint Conf .Rec
32
325-343
Payment o r non-payment - idvice of.
20 ¢
173-175
Pension Plan. «
hs,
5950-570
Par
C o l l e c t i c n s
i
a
« +»
Prior Indcorsements -
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Federal Reserve Bank of St. Louis
a o e a e o e Seek S O Sake u e
Guaranty of. . «
169-173
Program
and
Topic
tresentation b y hand o f cash letters.
Paragraphs i n
Secretary's
Minutes
. . .-
Pages i n
Stenorraphic
Report
354-361
Purchases a n d Sales o f G c vernment Se-~
11-26 ,Appendix,
curities = Report o f Committee. - ». .« « +
Joint Conf eRec»s
175-177
Railroad drafts, etc. - method o f handling.
Rates
Automatic Adjustment. « « «
Qpen Market « + «© « e e « «
Present discount rates. «
Uniform
Retpetes o f GCiscount s s .
6
11,3163
«
«6 6
6.8%
Redeemed Securities = checking against
registered mail advices «+. «+ + «+ 6 »
31260 ,322-325,
Joint C o n f . R e ¢ «
12
61-100,
23
102-120 ,151
23
210-215
Rediscounts
Limitation o n aggregate amount o f
agricultural
p a p e r .
e o = e ©
©
©
©
@
@
Repurchase agreements i n connection with.
Joint Conf .Rece —
120-126
Regulaticns (new) of Federal Reserve Board.
Reimbursement o f expenses
Account Federal Land Bank transactions.
Acecunt W a r Finance Corporation
" *$
534-535
534
Reports submitted;
Committee o n Central Execution o f Pure
chases a n d Sales o f Government SecuritieSe«
» «»
11-26 ,Appendix,
Joint Cenf.Rec.
«
Accounte
Committee o n Standardization o f
ing
F o r m s
. «
« e +
« + e ©
Insurante Committee .
*-¢
e s &
.
@ #
533-534
381~416
.
484-511 ,512-515
Leased Wire Committee «
Pension Committee -
©
w e : @
o8
550-563
Standing Committee o n Open Market
‘ditions and Operations. . . . .
Standing Committee o n Collecticns
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Federal Reserve Bank of St. Louis
26-31
151-195
Program
and
Topic
Paragraphs i n
Pagee i n
Stenographic
Secretary's
Minutes
Report
Reports o f Examination o f National Banke -
Payment for (Report of Oct. 1922 Governore
Conference Committee) . . « 6 s s
mepurchare Agreomonts..\'s.
453-458
& 8
e+ os es <8
Requirement o f credit statements o f subsidiary companies o f holding corporations
120-126
140-151;
529-532
Reserve Accounts o f country member banks -
Adjustment f o r currency i n transit . .. .
Reserves against "Special Savings" Deposits.
536-541
Joint C o n f ,
Re.
Safekeeping o f Securities - Liability o f
Federal Reserve Banks where knowledge
exists that securities are not property o f
Mepeci ting: Member. 0
eu
e e ele H e
e s
127-139
Salaries o f Junior Officers ~ Principles
whieh should control fixine o f g o s s i s a .
458-481
Securities
Checking redeemed securities against re~ gistered mail advices . 2 . . . 8 s h i a
Noneacceptance o f matured Government s e curities o n account original issues o f
Treasury Certificates o f Indebtedness
Of WICCe 6) e s i s C e g a 3 Eee Oe e s
216-229
Safekeeping; Liability of Federal Reserve
Banke w h e n n o t property o f depositing
MONDE.
G o
e A
a
e a
Services t o member banks
Telegram from American Bankers Associa-tion voluntarily rendered b y Federal
HORST V
G
: Banke: a -5 d e e e e e e p e e S
127-139
4514453
515-529
Sight Drafts with Bills o f Lading A t tached - Desirability o f making eligible
for CiShOiNt. 6°. 8 e e e e W e e e es
e e
"Special Savings" Deposits - Reserves
BRAAEG.. 6
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Federal Reserve Bank of St. Louis
i Sele e
e e Boe e s O58
Joint C o n f . Rec,
ProgramjParagraphs in} P a g e s i n
and S e c r e t a r y ' s |Stenographic
Topic |
ie|
Standardization o f Accounting Forms -
Re-
port o f Committee and new personnel. .
f
;
R e p o r t
Minutes
e
I A
4
9
5 3 3 - 5 3 4
State B a n k a n d Trust Company membership
Li S Y SCG i g o i e w a k e Sele, wee o e ee 2
Statements of Holding Corporations . .
e r
1
S
4
0
7
-
1
1
5
1
,
529-532
Subsidiary companies ~ Credit statements ;
1
4
0
-
1
5
1
,
529-532
Tax on Circulation - Advantage over franchise tax
Till Money » Deposits b y members i n Reserve
Bank: Cities a t Gloee o f tusinete: 6 s e s .
3
s e eed
7
3
0 377
6
7 --370
Time certificates o f deposit -~ method o f
Neate 6
ee t a c bos O i a
a s e oe e e
1
7
5
Time echedules - ~ Interedistrict deferred f
-
2
LTOaeUury “Leeien CSiONe < a 5. es @ e e ‘
9
9
1
"
1
7
-
7
3
1
9
:
1
6205,,
2
0 6+210
Uniform Indorsements b y Federal Reserve Banks
on cash a n d collection items received f r o m
moanbere o f other dietricte .
Uniform Ratee o f Discount...
o s 6 6 ée fe 6
2
<<.
7
I
2 9 5 - 2 9 8
i 3igeo
3 1 - 6 0 ,
322-325
Joint Conf,
Rec.
Unqualified Indorsements -
Liability o f Federal
Reserve Banks i n making , 2. 2. 6 6 e s 2 + 6 o s
1
6
5
foluntary servicee performed f o r member banke . .
9
1
5
1
-
5
7
3
2
9
j
War Finance Corporation .
HKeimbursement f o r
expensee incurred b y Federal Reserve Banke
5
. .
3
4
(Credit
Wire (Fate
(Payment o r von-payment
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Federal Reserve Bank of St. Louis
))
definition o f
terms
1
8
4
-
.
1
8
6
PROGRAM
4i
8G )
26,
NG
NF
ee
73
TOPICS SUGGESTED B Y FEDERAL RESERVE BOARD
(1) RESERVES AGAINST SO-CALLED "SPECIAL SAVINGS" DEPOSITS O N WHICH
A LIMITED AMOUNT O F CHECKING I S ALLOWED.
This i s a question which has been very much discussed
with the San Francisco Reserve bank with reference t o the
special savings accounts o f California state banks. Similiar
savings accounts h a v e been found i n other districts o n which
some checking i s allowed.
(2) N E W REGULATIONS.
Due to the amendments t o the Federal Reserve Act con~
tained i n the Agricultural Credits Act of 1923, recently
signed by the President, i t appears that it will be necessary
for the Board t o revise its Regulations s o as to be consistent
with the amended provisions o f the Act, a n d possibly t o issue
a new regulation with reference t o the redisecount o f agrieultural paper. T h e Board will attempt t o have a t least a
tentative draft o f proposed n e w Regulations r e a d y b e f ore the
Governors’ conference s o that i t may serve a s a basis for
diseussion.
&
( 3 ) LIMITATION ON AGGREGATE AMOUNT OF AGRICULTURAL PAPER WHICH MAY
BE REDISCOUNTED B Y FEDERAL RESERVE BANKS.
Section 13 (a) of the Federal Reserve Act as amended by
the Agricultural Credits Act makes certain classes o f nine
months' agricultural paper eligible for rediscount a n d provides that -
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Federal Reserve Bank of St. Louis
“The Federal Reserve Board may, b y regulation,
limit t a a percentage o f the assets o f a
Federal reserve bank the amount o f notes,
drafts, acceptances, o r bills having 4
maturity in excess of three months, but
not exceeding six months, exclusive of days
ofgrace, which may be discounted by such
bank, a n d the amount o f notes, drafts, bills,
or acceptances having a maturity i n excess
of six months, b u t not exceeding nine months,
which may b e discounted b y such bank."
So far a s six months paper i s concerned the Board long
ago fixed the limit o f 9 9 per cent. which i s i n effect not
a limit a t all and it would seem advisable for the Governors’
conference t o discuss the question whether a n y change i n
this limit a s to six months paper i s advisable, a n d also
whether i t i s advisable t o fix a limit with regard t o nine
months paper. I t may b e noted i n this connection that
Governor Wellborn o n December 27, 1922, formally requested
the Federal Reserve Board t o fix the amount o f agricultural
rediscounts which the Federal Reserve Bank o f Atlanta might
grant a t a certain percentage o f its assets.
T h e r e ap-
peared, however, t o be no particular eccasion for changing
the limit a t that time.
TOPICS SUGGESTHD B Y FEDERAL RESERVE BANKS
s
I
. C R E D I T TRANSACTIONS A N D POLICIES
A. R e p o r t o f Committee o n Centralized Execution o f
Purchases a n d Sales o f Government Securities
for account o f Federal Reserve Banks.
Governor Strong, N e w York, Chairman,
Report o f Standing Committee o n Open Market
Conditions a n d Operations.
Governor Fancher, Cleveland, Chairman.
Rates o f Discount.
1. Automatic Adjustment o f Is it possible o r expedient?
2. Uniform rates.
(
d
i
3. O p e n Market rates,
(
d
Rebates of Discount.
(
( d i s c u s s i o n ) Boston
s
i
a
c
s
u
c
c
s
u
t
s
s
i
s
i
o
i
o
o
n
) Atlanta
n
) Atlanta
n ) Richmond
Recommended:
That the policy o f granting rebates should b e
uniform among Federal Reserve Banks; that i t
should not b e the regular practice o f Federal
Reserve Banks t o grant rebates; t h a t i f a n d
when rebates a r e granted, t h e r e should b e some
good reason f o r s u c h action a n d the benefits
should accrue t o the customer o f the member
bank; t h a t rebates s h o u l d n o t b e made o n member
bank obligations (extept o n obligations secured
by Government b o n d s when t h e bonds a r e s o l d
prior t o maturity o f the obligations); that
rebates o n rediscounted paper should b e granted
only i n cases where such paper i s anticipated
by member bank customers, necessitating repay~
ment o f the paper i n advance o f maturity b y
member banks, a n d where the member banks make
rebates t o such customers; that when Federal
Reserve Banks grant rebates i n such cases, t h e
rebates should b e at the rate a t which the
paper was rediscounted, provided that rate
was not higher than the rate prevailing a t the
time the paper i s paid, i n which case rebates
should b e made at. the rate then prevailing.
BE. R e p u r c h a s e Agreements
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Federal Reserve Bank of St. Louis
counted paper,
i n Connection w i t h Redis-~
(
a
c
t
i
o
Recommended:
That Federal Reserve Banks should not take bills
receivable i n bulk f r o m member banks, g i v i n g a
fictitious maturity for the purpose o f making
short-time advances t o member banks;
o r take a
n
) Richmond
collateral agreement t o repurchase p a p e r s e
offered upon a fixed date; o r a standing
agreement t o repay sums loaned o r advanced
in such manner o n or against such paper
from time t o time.
Interpretation o f word "Borrower" i n Section 1 3
of the Federal Reserve Act. « Discussion o f
Board's opinion (if rendered) based on interpretations submitted b y each bank following
October, 1922, Governors Conference. ( d i s c u s s i o n ) S a n Francisco
Desirability o f making eligible f o r discount
sight drafts with bills o f lading attached.
(Committee appointed at October, 1922, Joint
Conference reported t o Federal Reserve Board)
Liability o f Federal Reserve Banks f o r securi-
ties accepted for safekeeping where knowledge
exists that they are property o f someone
other than member bank from whom accepted. ( d i s c u s s i o n ) Dallas
Importance o f New York call loan market.
Its operation.
(
d
i
s
c
u
s
s
i
o
n
) New York
Credit statements o f holding corporations»
Should statements o f subsidiary companies
be reguired b y Federal Reserve Banks? ( d i s c u s s i o n ) Richmond
COLLECTIONS AND CLEARINGS
A. R e p o r t o f Standing Committee o n Collections.
Mre Strater, Cleveland, Chairman.
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Federal Reserve Bank of St. Louis
Special consideration of “advice o f no returns"
{see pages 14, 15 and 16 collection committee
report)
‘
a
c
t
i
o
n -
Dallas
scommendeds
That an advice describing the item should
be forwarded by a Federal Reserve Bank or
branch to the sending bank, specifically
advising final fate o f a check, covering
which.an advice o f “no returns" h a s pre«-
viously been forwarded, deposited b y
another Federal Reserve Bank, branch o r
direct sending member bank.
Uniform indorsement b y Federal Reserve Banks o n
cash a n d collection items received f r o m mem-
ber banks and other Federal Reserve Bankse (discussion) Kansas City
Inter-district deferred t i m e schedules. {
discussion) Richmond
Large volume o f thecks lost i n transit after
deposit i n Federal Reserve Bank o r by direct
sending « {
action)
N e w York
Recommended;
That t h e conference consider this
question i n a broad way; assemble data
showing the amount involved i n 1922;
and then take t h e matter u p with t h e
Postmaster General with a view to
bringing about a reduction i n the
number o f lost items.
Par Collections,
Establishment o f uniform policy t o b e pursued
when final decigion i n Atlanta case i s
handed dow,
(
d
i
s
c
u
s
s
i
o
n
)
Desirability o f uniform policy i n matter o f
balances required o f nonmember banks making
( d i e c u s s i o n )
use of collection facilities,
Policy with respect t o handling coupon col- ( d i e c u s s i o n
p r i o r to
lections a n d other nonecash collections.
reference t o
committee }) N e w York
Direct sendinge o f country checke b y member ( d i s c u s s i o n
banks i n 6ne district t o points i n other p r i o r t o
r
e
f
e
r
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n
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e to
districts,
committee )
N e w York
COIN, CURRENCY AND CIRCULATION
A, Standardization o f circulating fitness o f
Federal Reserve Notes.
(
a
c
t
i
o
Recommended $
That the Treasury Department b e re~
n
S
)
a
n Francisco
;
' quested to lodge with each Federal
Reserve Bank packages o f Federal
Reserve Notes representing two o r
more standards o f fitness which the
Federal Reserve Banks may use a s a
guide for the sorting o f circulated
currency.
B. Deposit o f till money a t close o f business b y
Richmond
member banke i n Reserve Bank Cities, ( d i e c u s e i o n )
C. Advantages t o Federal Reserve Banks o f subeti-
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Federal Reserve Bank of St. Louis
tuting tax on circulation for Government
participation i n profits.
‘s
( d i s c u s s i o n ) Philadelphia
Pogesibility of legislation.
Figures requested Franchise tax last year.
Tax i f 2 % on outstanding currency
not covered b y gold,
Poesible reduction o f tax below
actual franchise payment b y more
close allocation o f gold; keeping
larger amount i n Agent's hands, etc.
we 4
w
e
OPERATION
4. Report o f Insurance CommitteeMr. Cramer, Chicago, Chairman.
(Now resigned; new appointment)
.
Employees! Insurance Is each bank justified i n carrying
its own insurance risk. (
discussion) Chicago
Figures requested Amount o f premiums paid.
Amount o f death losses settled.»
Report o f Pension Committee.
Mr. Kenzel, N e w York, Chairman.
Report o f Leased j/ire Committees
Governor McDougal, Chicago, Chairman.
Committee o n Economy and Efficiency.
Desirability o f having operating repre-
sentative o n Federal Reserve Board's
discussion). San Francisco
Committee. {
Payment f o r Reports o f Examination o f
national b a n k s s
Report filed b y committee appointed a t
October, 1922, Conference.
Principles which should control fixing
of salaries o f junior officers i n ;
Federal Reserve Bankse (
:
discussion) Philadelphia
FISCAL AGENCY OPERATIONS
A. Desirability o f checking shipments o f ree#
deemed securities against advices o f
shipments forwarded b y separate registered mail. (
discussion) Cleveland
Bs U n d e s i r a b i l i t y o f accepting matured
Government securities o n account o f
allotments o f original issues o f
Treasury certificates o f indebtedness
or Treasury notes»
( d i s c u s s i o n ) Cléveland
VI.» ACCOUNTING A N D AUDITING
A» Committees o n Standardization o f Accounting
o f . =
Forms «
Mr. Vogt, Chicago, Acting Chairman.
Is continuance desirable, and, i f so,
two vacancies t o be filled.
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Federal Reserve Bank of St. Louis
B. Reimbursenent f o r expens
War
F j
Kansas
Should r e s e a c c o u n t s o f country member
banks e i v e adjustment f o r currency i n
transit.
(
d
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c
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s
s
i
f"
o
4
n
H S
N a w %
m i e
) N e w York
LEGISLATION .
en Renee erences
sent A m e n d m e n t s
t o Federal Reserve Act.
Senate Resolution 4
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Federal Reserve Bank of St. Louis
eauses f o r nonmem=-
-
bership 9 : 3 8 a n k s and trust companies. ( d i s c u s s i o n )
Q
s
h
o
u
l d Federal Reserve
of bill.
G O V E R N O R S
C O N F E R E N C E
March 2 6 « 29, 1923.
First Day's Session, Monday, March 2 6
(Morning )
The meeting w a s called t o order a t 10:15 o'clock a . m.
Present;
Honorables D. R. Crissinger a n d C. S. Hamlin,
Members of the Federal Reserve Board;
Governors Harding, Norris, Fancher, Seay,
McDougal, Biggs, Young, Bailey, McKinney,
and Calkins;
Deputy Governors C a s e a n d Adelson.
Appointment o f Acting Chairman. G o v e r n o r McDougal opened the
session b y explaining t h a t t h e Board desired t o have t h e conference proceed
with consideration o f its owm program until Wednesday o r Thursday before
having its meeting with the Federal Reserve Board.
H e explained the absence
of the Chairman, Governor Strong, a n d stated that h e was calling the meeting
to order a t Governor Strong's request.
T h e r e u p o n , u p o n motion o f Governor
Fancher, i t was
VOTED t o make Governor McDougal chairman o f this conference.
The Chairman requested Comptroller Crissinger t o address the conference o m behalf o f the Federal Reserve Board.
T h i s h e did, referring
particularly t o the following matters -
Death o f Honorable Milo D. Campbell, Recently appointed
member o f the Federal Reserve Board.
Mr. Crissinger explained that because o f t h e death o f Mr. M i l o D .
Campbell the Board would have n o formal meeting o n Monday, b u t stated that
the Board felt that the Governors should not b e kept from a consideration o f
their program.
H e also stated that t h e Board would want t o have i t s meeting
with the Governors o n Wednesday o r Thursday after Mr. Platt'’s return from
Mr. Campbell's funeral.
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Federal Reserve Bank of St. Louis
( s e e paragraph 6 )
Joint meeting with Federal Farm Loan Board.
M r . Crissinger laid
before the conference the reauest o f Judge Lobdell, o f the Farm Loan Board,
for a meeting o f his board with the Governors, suggesting Tuesday morning a s
anappropriate time. ( s e e paragraphs 8, 26)
Evening meeting a t Metropolitan Club.
T h e Comptroller invited t h e
Governors t o a dinner meeting Monday night a t the Metropolitan Club.
The Comptroller a n d Mr. Hamlin left t h e conference a t this point a n d
the conference proceeded a s follows =
Appointment o f Acting Secretary.
sence, t h r o u g h iliness,
T h e Chairman explained t h e a b -
o f Mr. Harrison, Secretary o f t h e Conference, a n d ,
upon motion o f Governor Fancher, i t was
VOTED t h a t Mr. D. H. Barrows o f the Federal Reserve Bank o f New
York b e made secretary o f this meeting.
Death of Honorable Milo D. Campbell.
( s e e paragraph 2 )
The Chairman suggested that appropriate action concerning Mr.
Campbell's death b e taken b y the conference; whereupon, o n motion o f
Governor Fancher i t was
VOTED unanimously t o adopt a resolution expressing the sense o f
loss o f the conference a t Mr. Campbell's death; t o wire i t to Mr. Campbell’s
family; t o hand a copy t o the Federal Reserve Board; and, after that, t o send
a copy t o the press.
Aosent members.
T h e Chairman suggested that appropriate action
be taken w i t h respect t o t h e absent members o f t h e conference.
Whereupon o n
motions o f Governor Calkins, i t was
VOTED t h a t telegrams b e sent b y t h e Chairman t o Governor Strong a n d
Mr, Harrison expressing t h e regret o f the conference a t their absence.
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Federal Reserve Bank of St. Louis
Joint meeting w i t h Farm Loan Board,
{ s e e paragraph 3 )
The Chairman appointed Governor Y o u n g t o wait u p o n t h e Farm Loan
Board a n d make arrangements f o r a
meeting (10:00 a . m.) Tuesday morning.
(see paragraph 26)
Topic 1. A. R e p o r t o f Committee o n Centralized Execution o f Purchases a n d Sales o f Government
Securities f o r account o f F . R . Banks.
Considerable discussion w a s h a d o f t h e report (printed i n appendix
to stenographic record) a n d of the bearing upon its adoption o f a memorandum
(pages 16-20 stenographic record) prepared b y Mr. Miller o f the Federal Reserve
Board relating t o the subject o f Federal Reserve Bank investments and to the
Governors Committee i n particular.
U p o n motion o f Governor Seay, i t was
VOTED t h a t t h e report o f t h e Committee o n Centralized Execution o f
Purchases a n d Sales o f Government Securities b e received a n d filed; t h e
understanding being that further discussion o f this matter would be had at the
joint session with the Federal Reserve Board. ( s e e paragraph 62)
Topic 1. B. R e p o r t o f Standing Committee o n Open
Market Conditions a n d Operations.
After a reading of the report (printed pages 27~31 stenographic
record) a Governor Fancher, and upon his motion, i t was
VOTED t h a t t h e report o f the Committee o n Open Market Conditions
and Operations b e received and filed; i t being the sense o f the conference
that t h e discussion a n d action taken i n connection w i t h topic I . A. also
applied t o this matter.
Topic I. C. R a t e s o f Discount
1. Automatic Adjustment of,
Is i t possible o r expedient
2. U n i f o r m Rates
3. O p e n Market Rates.
Governors Harding, S e a y a n d Norris, a n d Deputy Governor C a s e out-
lined a t some length their o m views, a s well a s the discussims h a d with
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Federal Reserve Bank of St. Louis
-
4 A «=
Professor Bullock o f the Harvard Committee o n Economic Research i n connection
with t h e possibility o f establishing s o m e sort o f automatic adjustment o f discount rates ( w h i c h topic Governor Harding explained h a d been placed o n the
program a s a result o f his discussions w i t h Professor Bullock).
T h e opinion
seemed t o b e that what economists i n general are interested i n is education
of the public i n the matter o f rate adjustments, rather than i n the establishment o f a n automatic r a t e adjustment.
A f t e r further discussion o f matters
relating t o t h e System's r a t e policies a n d the interest o f t h e public i n that
subject, i t was, upon motion o f Governor Harding
VOTED t h a t a
committee o f three b e appointed b y t h e chairman t o
draft a memorandum covering everything included under Topic 1, C., for consideration b y t h e conference.
The chairman appointed Governors Seay and Calkins and Deputy
Governor Case t o act as such a committee.
Further general discussion o f the other two matters covered b y this
action, namely Uniform Rates and Open Market Rates, w a s had, but i t was
to rest t h e whole matter w i t h t h e committee appointed.
{ s e e para-
31, 63).
Present discount rate.
on the subject o f discount rates.
T h e chairman opened a general discussion
B a c h o f the Governors present was re-
quested t o express his opinion o n prevailing conditions i n s o far a s they may
be i n a n y w a y related t o t h e rate question.
T h e discussion i s reported o n
pages 61-100 o f t h e stenographic record,
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Federal Reserve Bank of St. Louis
At 1:05 o'clock the conference adjourned t o reconvene a t 2:30
First D a y ' s Session, Monday, M a r c h 2 6
(Afternoon )
The meeting was called t o order a t 2:45 o'clock p. m.
Present:
Governors Harding, Norris, Fancher, Seay,
McDougal, Biggs, Young, Bailey,
McKinney a n d Calkins;
Deputy Governors C a s e a n d Adelson;
Mr. Barrows, Acting Secretary.
TOD8e 2 5 D e R e b a t e s o f Discount
The practice o f granting rebates (and the rate a t which the rebate
is meade) i n the several districts w a s discussed generally,
i t being under-
stood that the policy o f the Federal Reserve Banks i n this regard should b e
to permit rebates when there i s good reason for doing so, but that member
banks should not b e permitted t o abuse the privilege.
U p o n motion o f
Governor Seay, i t was
VOTED t h a t w h e n Federal Reserve Banks grant rebates t h e rebate
should b e at the rate a t which the paper was rediscounted, provided that rate
was not higher than the rate prevailing a t the time the paper was paid, i n
which c a s e t h e rebate should b e made a t the rate t h e n prevailing.
.E. R e p u r c h a s e Agreements i n Connection
with Rediscounted Paper.
General discussion of the practices of the several banks in (1)
taking bills receivable i n bulk from member banks and giving a fictitious
maturity f o r t h e purpose o f making short-time advances t o member banks;
(2) taking collateral agreements to repurchase paper s o offered upon a fixed
date, a n d (3) i n entering into a standing agreement t o repay sums loaned o r
advanced i n such manner o n o r against such paper from time t o time,was had.
On motion o f Governor Fancher, i t was
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Federal Reserve Bank of St. Louis
owgia
VOTED t h a t i t i s the sense o f t h e conference t h a t s u c h advances
and agreements extend a facility t o which member banks are entitled and which
they should not b e preciuded from using.
Topic 1. F. Interpretation o f word “Borrower"
in Section 1 3 o f Federal Reserve Act.
At the October 1922 Conference o f Governors i t was recommended that
the counsel o f the several Federal Reserve Banks file with the Federal Reserve
Board their opinions relative t o the interpretation o f the word “borrower” i n
Section 1 3 of the Federal Reserve Act, a n d the Federal Reserve Board was then
requested t o postpone a ruling o n this subject until these opinions were received.
I n a s m u c h a s n o ruling h a s a s yet been promulgated,
i t was, u p o n
motion o f Governor Calkins,
VOTED t h a t t h e Federal Reserve Board b e requested t o make a
ruling
on this question.
Topic I. G. Desirability o f making eligible for discount sight drafts with bills o f lading
attached.
This topic was passed a s being covered b y a recent act o f Congress.
Topic: 1 a M s L i a b i l i t y o f F. R. B s for securities
accepted f o r safekeeping where knowledge
exists that t h e y a r e property o f someone
other than member bank from whom accepted.
The liability o f Reserve Banks for securities accepted for saf e=
keeping, w h e r e there i s knowledge t h a t t h e y belong t o someone other t h a n
the depositing member was discussed, a n d each Governor indicated the practice
of his bank i n accepting securities for safekeeping.
N o action was re~
quested o r taken.
Topic 1. (i) Importance o f New York Call Loan Market.
Mr. C a s e discussed briefly t h e N e w York Call Loan Market a n d referred t o t h e importance o f a
sympathetic understanding o f i t s relation t o the
financial centers o f the country.
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Federal Reserve Bank of St. Louis
(17)
TODEG L P s
C r e d i t Statements o f Holding Corporations.
After a general discussion o f the difficulties o f ascertaining the
acceptability o f paper o f f e r e d for rediscount either b y a
parent o r a n allied
company without adequate information i n the shape o f credit statements, i t
was, u p o n motion o f Governor Norris,
VOTED t h a t a committee b e appointed t o formulate some definite
recommendation regarding this topic for adoption b y the conference.
The Chairman appointed Messrs. Norris, Calkins a n d Fancher t o
serve a s such a
committee.
( s e e paragraph 4 8 )
Topie 11. A. R e p o r t o f Standing Committee o n Collections.
(For text s e e stenographic r e c o r d pages
152-160; 170-173; 173-175; 175-177;
177-181; 181-186)
The conference dealt with the report topic b y topic and concluded
<
t
o receive a n d adopt the report a s submitted, with such qualifications a s are
noted below =
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Federal Reserve Bank of St. Louis
Uniform Liability Clauses -
Governor Young, because
of the conditions peculiar t o his district, stated that
it would be impossible for him now t o agree t o the clauses
proposed b y the committee without a n addition which h e had
suggested. U p o n motion o f Mr. Case, i t was
Voted t h a t t h e matter b e referred b a c k t o the com-
mittee with instructions t o take the matter u p with counsel
of the Minneapolis bank i n order t o see if i t might not b e
possible t o have him agree to the uniform clauses which
have been approved b y the other eleven banks.
Liability o f Federal Reserve Banks i n making unqualified
indorsements
o n checks received for collection.
U p o n motion
ofGovernor Norris, i t was ;
Voted t h a t t h e conference unanimously agree u p o n t h e
form of uniform indorsement (including guarantee o f prior
indorsements) recommended b y the committee a n d that this
action b e communicated t o the Federal Reserve Board i n order
that the Board may make any changes that i t might consider
necessary i n regulation J .
Advising payment o r non-payment b y wire o n cash o r col-
lection items. U p o n motion of Governor Calkins, i t was
Voted t o adopt t h e recommendation o f t h e committee
that s u c h advice h y wire should n o t include charges incurred
in the telegram.
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Federal Reserve Bank of St. Louis
Uniform method o f handing demand and time certificates o f deposit, drafts with pass books attached, a n d
drafts o n Railroad Companies.
U p o n motion o f the Chair-
man, i t was
Agreed
t o concur i n the suggestion o f t h e committee
that uniformity i s practically impossible inasmuch a s
custom a n d practice i n the various districts s h o u l d govern.
Should a F. R. Bank collect notes and drafts i n cities
or towns where there i s not a par remitting bank.
motion o f Governor Seay, i t was
U p o n
Voted t o acquiesce i n the conclusions o f the committee
that f o r t h e protection o f t h e sending Federal Reserve Bank
each bank should undertake t o collect a n y non-cash items
payable i n its district.
Advice o f N o Returns.
U p o n motion o f Governor Seay,
it was
Voted t o receive and adopt the committee's recommenda-~
tions (1) that the use of the form "Advice of No Returns"
be restricted a s much a s possible a n d that w h e n u s e d care
should b e exercised t o give only such information a s is
valuable t o t h e bank t o whom sent. ( d e t a i l s o f recommenda-
tion pages 182-183 o f stenographic record) a n d (2) that
each Federal Reserve Bank incorporate i n its time schedule
the notation -
"Checks dravm o n banks not located i n a
Federal Reserve c i t y b u t bearing u p o n their f a c e
a notation t h a t t h e y a r e payable a t o r receivable
for immediate availability i n a Federal Reserve
city will b e accepted o n the same basis a s checks
drawn o n banks located i n that city."
Governors Bailey, McKinney a n d Calkins asked to b e recorded a s voting i n the negative.
Definition o f the Terms "Wire Fate," Wire Payment o r
Non-Payment" a n d "Wire Credit." U p o n motion o f Governor
Seay, i t was
Voted t h a t the recommendations o f the committee relative t o the u s e o f t h e above terms b e adopted.
The committee's recommendations are printed on pages
184-186 o f t h e stenographic record.
Blanket Guaranty covering indorsement b y F. R. B s
on all items forwarded direct for collection b y member
banks. T h e recommendation o f the committee that all reserve banks give this letter o f guaranty was read to the
conf er ence. T h e committee explained that each reserve
bank with the exception o f Minneapolis has already complied
with its recommendation.
Governor Young referred t o the reasons which have prompted
the Minneapolis bank not t o give a blanket guaranty o n all
items forwarded direct for collection b y its member banks.
No action was taken, the discussion having been interrupted
for a conference with Mr. Gilbert.
It was later (pages 286-294 o f stenographic record)
Understood t h a t Governor Young would again discuss
the matter w i t h his Executive Committee i n view o f certain
conditions c a l l e d t o Governor Young's attention a n d advise
the other Federal Reserve Banks whether h i s bank will issue
a blanket guaranty.
Treasury Transactions.
U n d e r Secretary Gilbert joined the con-
ference and discussed certain matters relating t o tax payments and Govern-
ment financing. ( s e e paragraph 22)
At 6:20 o'clock p . m. t h e conference adjourned t o reconvene a t
10:00 a . m. Tuesday, M a r c h 27.
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Federal Reserve Bank of St. Louis
Second Day's Session, Tuesday, M a r c h 27.
(Morning )
The conference w a s calleo t o order a t 10:08 o'clock a , m ,
Present;
Governors Harding, Norris, Fancher, Seay,
McDougal, Biggs, Young, Bailey, McKinney
and Calkins;
Deputy Governors Case and Adelson;
Mr. Barrows, Acting Secretary.
Treasury Transactions.
( s e e paragraph 21)
Under Secretary Gilbert j o i n e d t h e conference t o complete discus-
sion of matters considered a t the last session, a n d also t o discuss those
topics o n the reguler p r o g r a m relating t o fiscal agency operations.
Topic V.<A. D e s i r a b i l i t y o f checking shipments o f
redeemed securities against advices o f
shipments forwarded b y separate regis~
tered mail.
Governor Fancher stated that this topic had been placed upon the
program a s a result o f certain difficulties experienced b y t h e Federal R e ~
serve Bank o f Cleveland.
M r . Gilbert explained that a
committee h a s been
appointed t o consider the system of receiving shipments o f redeemed securities and t o make any improvement that may b e necessary t o obviate present adifficulties.
N o action was asked o r taken.
Topic ¥.° 3. Undesirability o f accepting matured Government securities
o n account o f allotments o f
original issues of Treas. C/l or Treas. notes.
In discussing t h i s subject, Mr. Gilbert indicated that h e appres
ciated the difficulties related b y some o f the Governors, b u t stated that
in his opinion the difficulties were outweighed b y the advantages, which
were referred t o i n some detail.
New Currency Designs.
N o action was requested o r takwn.
M r . Gilbert reported that the committee
which h a s been considering t h e n e w designs f o r currency h a d submitted i t s
report a n d that the forms are now i n the hands o f the Federal Reserve Board
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Federal Reserve Bank of St. Louis
(25)
ee) eee
and available for examination b y the Governors.
Joint meeting w i t h Farm Loan Board.
( s e e paragraphs 3 , 8 )
The members o f the Farm Loan Board went into session with the conference a s previously arranged.
J u d g e Lobdell, C h a i r m a n o f that Board, r e »
ferred t o the recent Act of Congress authorizing the incorporation o f twelve
Federal Intermediate Credit Banks t o b e operated under the jurisdiction o f the
Farm Loan Board.
H e asked individual members o f the conference for a n ex-
pression o f their opinion o n the following matters - (1) the extent t o which
there will b e any demand i n their districts for the type o f credit which will
be available through Federal Intermediate Credit Banks and the nature o f the
security that will b e offered; (2) the attitude o f the Federal Reserve Banks
toward the purchase of debentures which might be issued by the Federal Inter~
mediate Credit banks; a n d (3) the rates o f discount charged b y the Federal
Intermediate Credit Banks a n d rates o f interest o n the debentures issued b y
them.
The conference adjourned a t 1:10 o'clock t o reconvene a t 3:00
o‘clock pe. M s
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Federal Reserve Bank of St. Louis
Second Day's Session, Tuesday, M a r c h 2 8
(Afternoon }
)
The conference w a s called t o order a t 3:00 o'clock p . m.
Present:
Governors Harding, Norris, Fancher, Seay,
McDougal, Biggs, Young, Bailey,
McKinney, a n d Calkins;
Deputy Governors C a s e a n d Adelson;
Mr. Barrows, A c t i n g Secretary.
The Chairman r e a d t o t h e conference a
telegram f r o m Governor
strong i n response t o that s e n t t o h i m b y the Governors (see paragraph 7 )
POMkC: L i a D
U n i f o r m indorsement b y Federal Keserve
Banks o n cash a n d collection items r e ceived f r o m member banks a n d other Federal Reserve Banks.
Governor Bailey pointed out the lack of uniformity i n guarantecing
prior indorsement o n non-cash collection items.
T h e conference having al-
ready agreed t o t h e r e c o m m e n d a t i o n o f t h e Collection Committee that Keserve
Banks should guarantee prior indorsements o n cash items, (paragraph 20d), i t
was, upon motion o f Governor Calkins,
VOPED t h a t each bank refer t o its o w counsel the question o f
whether there i s any reason why such a n indorsement should not b e made o n
non-cash items,
Tovie L i e :
Inter-district deferred time schedules.
Governor Seay stated that the occasion for bringing u p this matter
was t h e change i n the Philadelphia t i m e schedule recently m a d e a n d the effect
this had on banks i n the Richmond district.
a f t e r discussion, i t was
AGREED t o let the matter rest pending the next conference, with
the understanding that meantime the officers o f the Boston, N e w York,
Philadelphia, Cleveland and Richmond Reserve Banks discuss the matter among
themselves with a view to working out the problem.
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Federal Reserve Bank of St. Louis
Tonle Tie. Dp.
after aeposit i n FF. R. 5B,
sending.
Mr. G a s e reported receipts o f complaints f r o m various member banks
on this subject, presenting t o t h e conference a
tabulation o f t h e cash letters
Lost i n the mails b y all Reserve Banks during the year 1922. T h e r e was discussion o f the losses i n various o f the districts, and, upon motion o f
Governor Seay, i t was
VOTED t h a t the New York bank b e requested, i n behalf o f the conference, t o present this record t o the Federal Reserve Board with the request
that t h e matter b e taken u p b y t h e Board with t h e Postmaster General.
Topic II. F. Desirability o f uniform policy i n matter
ofbalances required o f nonmember banks
making u s e o f collection facilities.
The practice of the several banks i n the matter o f requiring
balances o f nonmember banks making use of collection facilities were outlined.
Governor Biggs (who stated that h e had proposed the topic merely t o learn o f
the practices o f the other banks) asked for n o action.
Topic I. C. R a t e s of Discount. ( s e e paragraph 11)
1. Automatic Adjustment
2. Uniform Rates
3. O p e n Market Rates
Governor Seay stated that the committee was prepared t o submit t o
the conference its report o n the topics under "Rates of Discount" referred to
it b y the conference.
A f t e r discussion,
i t was, u p o n motion o f Governor
Norris,
VOTED
t o adopt t h e report submitted b y t h e committee.
The report i n substance provided (1) that a n automatic adjustment
of discount rates i s not possible; ( 2 ) that while a t present a uniform rate
may be justifiable and expedient, Federal Reserve Bank discount rates cannot
be expected t o b e uniform under a l l conditions d n d circumstances; ( 3 ) that o p e n
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Federal Reserve Bank of St. Louis
- 14.=
market rates should n o t b e arbitrarily determined;
ask t h e Federal Reserve B o a r d t o refer,
a n d (4) that t h e conference
i n the form suggested, f o r a
number o f
weeks i n making its weekly statement o f the condition o f the Reserve Banks, t o
the question o f g o l d imports i n its relation t o reserve rates.
( s e e para-
graph 63).
Topic T i e E s
P a r Collections.
The status o f pending par clearance actions was reported b y the
several Governors i n whose districts cases are pending . A f t e r considerable
. discussion o f these cases and of the general policy, present and future, o f
the Reserve Banks w i t h respect t o par clearance, t h e topic w a s passed with-
out action.
Topic II. G. P o l i c y with respect t o handling coupon collections a n d other non-cash collections.
Mr. Case suggested the advisability o f referring this matter t o the
Standing Committee o n Collections for report t o the next conference a n d this
was voted,
( B u t see paragraph 4 7 where the matter was reconsidered i n the
light of the Federal Reserve Board's memorandum X-3676).
Topic 11. H e D i r e c t sendings o f country checks b y member
banks i n one district t o points i n other
districts. .
The Chairman appointed representatives o f t h e Federal Reserve Banks
ofBoston, N e w York and Richmond t o act a s a committee t o study the matter,
and, i f necessary, report their conclusions t o the Federal Reserve Board,
It w a s understood that t h e representative o f the N e w York b a n k should a c t
aS a i i wel of the committee.
Presentation b y h a n d o f C a s h Letters.
Governor McKinney submitted a
letter i n which t h e Comptroller o f
the Currency inquired about the practice o f Federal Reserve Banks i n sending
messengers f r o m théir offices t o make personal presentation o f c a s h letters
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Federal Reserve Bank of St. Louis
e215
for collection. G e n e r a l discussion o f this topic showed that while a
majority o f t h e Federal Reserve Banks h a v e f r o m time t o time collected items
in this manner, nevertheless they have always exercised extreme caution i n
selecting their agents and i n instructing them what caution i s necessary i n
making presentations o f this character.
U p o n motion o f Governor Seay, i t was
VOTED t o b e the sense o f the conference that i t is sometimes
necessary t o send a representative t o present checks a t banks upon which
drawn, a n d that this i s a necessity which cannot always b e avoided.
Topic Jil. A. Standardization o f circulating fitness
of Federal Reserve Notes.
After explaining the desirability o f having two o r more standards
of fitness for use as a guide i n sorting circulated currency, i t was, upon
motion o f Governor Calkins
VOTED t h a t the Treasury Department b e requested t o lodge with
each Federal Reserve Bank a n d Branch sample packajes o f Federal Reserve Notes
which may b e used a s a guide for the sorting o f circulated currency.
Topic III. B. D e p o s i t o f till money a t close o f business
by member b a n k s i n Reserve B a n k cities.
Governor S e a y pointed o u t the amount o f work p u t upon Federal R e «
serve Banks b y the disposition o f certain banks a t the close o f business t o
deposit their till money for credit and then apply for new money the next
morning.
D i s c u s s i o n developed t h e fact t h a t t h e tendency d o e s not s e e m t o
be general, a n d that i t i s a matter that can b e handled effectively b y each
Reserve Bank if occasion arises, T h e topic was passed without action.
Topic Jil. C. A d v a n t a g e s t o Federal Reserve Banks o f
substituting t a x o n circulation f o r
Government participation i n profits.
Governor Norris r e a d a
memorandum relative t o this topic, w h i c h
pointed out the disadvantages o f giving t o the Government a partnership interest i n the earnings o f the Federal Reserve Banks, a n d which mentioned the
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Federal Reserve Bank of St. Louis
« 16's
@
oossibility o f a n amendment t o the law providing that each bank shall pay a
fixed rate o f interest o n the uncovered portion o f Federal reserve notes outstanding i n lieu o f the existing provision f o r the payment o f a franchise tax.
Statistics were given showing the amount that would have been paid to the Government during 1922 a s a n interest charge upon a hypothetical interest rate o f 2 %
on all uncovered notes outstanding.
The members o f the conference expressed sympathy w i t h t h e views con-
tained i n the memorandum, and, upon motion o f Mr. Case, i t was
VOTED t h a t the Chairman appoint a committee o f two t o discuss the
question with the Under Secretary o f the Treasury t o ascertain whether the
Treasury Department would interpose any objection t o the consideration o f such
@ plan.
The chairman thereupon appointed Governor Norris a n d Deputy Governor
Case t o act a s such a committee.
It was understood that Governor Norris would send to each Governor a
uniform blank o r questionnaire t o b e filled o u t b y each bank giving pertinent
statistics for the years 1919-20-21-22.
At 5:45 o'clock p. m. the conference adjourned t o reconvene a t 10:00
o'clock. o n Wednesday morning, March 28.
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Federal Reserve Bank of St. Louis
a
Third Day's Session, March 2 8 t h
(Morning)
The conference w a s called t o order a t 10:00 o'clock a . m e
Present:
Governors Harding, Norris, Fancher, Seay,
McDougal, Biggs, Young, Bailey,
McKinney a n d Calkins;
Deputy Governors C a s e a n d Adelson;
Mre Barrows, Acting Secretary,
Topic IV. A. R e p o r t o f Insurance Committee
After discussion, a n d upon motion o f Governor Calkins, i t was:
VOTED
t o submit t h e report o f t h e Insurance Committee a n d t h e proposed
plan (pages 381-416 stenographic record) t o the Federal Reserve Board for consideration with the request that the Board advise the several reserve banks o f its
conclusions.
It was understood that i f approved b y the Board, and subsequently b y
the directors o f the several Reserve Banks, t h e recommendations o f the report
will t h e n b e put into effect witheut further action b y the conference.
Later, u p o n motion o f Governor Fancher,
VOTED
i t was
t o authorize t h e Chairman t o fill t h e vacancy o n the committee
caused b y the resignation o f Mr. Cramer.
Telegram from National Bank Division of American (
40°
Bankers Association ~- Free services t o member banks.
. Governor Calkins referred t o the conference a telegram from the manager
of the National Bank division o f the American Bankers Association deplering certain
practices o f the Reserve Banks i n rendering f r e e services t o member banks a n d sug-
gesting that the matters referred t o ehould b e considered b y the Governors :
Conferences U p o n motion o f Governor Harding, i t was
_VOTED t o refer the telegram t o the Federal Reserve Board for
consideration.
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Federal Reserve Bank of St. Louis
Topic IV. FF. P a y m e n t f o r Reports o f Examination
of national banks.
The written report o f the sub-committee o f Governors a n d Federal
«IB.
Reserve Agents made subsequent t o the October 1922 canference concerning com-
pensation f o r reports o f examination o f national banks furnished b y the
Comptroller o f the Currency was incorporated i n the record.
After discussion, i t was
UNDERSTOOD t h a t the arrangement referred t o i n this report and now
in effect will continue unless and until amended.
Topic IV. G-e P r i n c i p l e s w h i c h should control f i x i n g
of salaries o f junior officers i n F-R.Bs.-
There was general discussion o f the principles governing the salary
policy o f the various banks, i n s e far as it relates t o junior officers. ‘ I t was
generally felt that the value o f the particular man t o the reserve bank should
control, a n d that there should b e n o arbitrary o r fixed salary range throughout
the system for such officers.
Speeding u p Collections b y means of Air Service (
The Chairman submitted a
43)
letter w h i c h the Aviation Syndicate Inc.,
New York, h a d addressed under date o f March 28, 1923 t o Mr.
Hamlin o f the Federal
Reserve Board i n regard t o facilitating collections b y air service.
I t appeared
to the conference t o be purely a commercial proposition, possibly worthy
o f consideration b y the Post Office Department.
U p o n motion o f Governor Harding, i t was
VOTED t o lay the matter o n the table.
Topic IV. D. R e p o r t o f Leased Wire Committee (
Upon motion o f Mr. Case, i t was
WTED
t o adopt the report o f the Leased Wire Committee ( printed
pages
484-487 stenographic record) .
Governor Harding did not vote and Governor Young wished
t o be recorded
as voting i n the negative.
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Federal Reserve Bank of St. Louis
At 1:17 o'clock. the conference adjourned t o
reconvene a t 2:30 o'clock
44)
ay, March 28th
called
t o order
a t 2:35
Governors Norris, Fancher, Seay, McDougal,
Biges, Young, Bailey, McKinney, :
Calkins, a n d Harding;
Deputy Governors C a s e a n d
Mr. Barrows, Acting Secretary.
Va D s
c e p o r t o f Leased Wire Committee
eee
eSparagraph 44)
¢
The Chairman called attention t o that portion o f the report o f the
Lea eased
Wire Committee relating t o test words o n Telegraphic transfers f o r t h e
Treasury.
M r . Higgins o f the Federal Reserve Bank o f New York joined the
conference a n d reported having interviewed the Treasurer o f the United States
who agreed t o t h e recommendation o f the committee relative t o t h e u s e o f test
words i n the manner outlined b y Mr. Higgins.
J
I
t
was
UNDERSTOOD t h a t the plan, which contemplates furnishing the Treasurer's
office with a:copy o f the code book, a n d a separate o r different key, would b e
approved.
Open Market Operations.
eration o f the conference a
The C h a i r m a n s u b m i t t e d f o r t h e c o n s i d -
memorandum prepared b y t h e Federal Reserve Board
KX-3675 - (printed pages 517-520 stenopraphic record) concerning open market
Operations, which was considered at some length, off the record. T h e matter
was informally discussed w i t h some o f the members o f t h e Board a n d also w i t h
Mr. Gilbert.
N o action w a s
Voluntary Services Assumed b y F.R.Bs. f o r their members.
The Tentative suggestion o f the Federal Reserve Board - X3676 { printed
pages 516-517 stenographic record) t h a t certain voluntary services performed f o r
member banks should b e discontinued w a s considered, a n d , u p o n motion
o f Governor
Seay, i t was
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Federal Reserve Bank of St. Louis
WTED
t o b e t h e sense o f t h e conference t h a t none o f the services
enumerated i n the Board's memorandum
should b e discontinued a t this time, but
r
t
s o e m
——
that the whole subject o f non-cash collections should v e referred t o a special
committee o f Governors t o b e selected b y the Wederai Reserve Board f o r consideration a n d report.
It was understood that this action b y the conference superseded
the earlier action (paragraph 3 3 ) o f the conference i n referring t h e matter
of coupon collections and non-cash collections o
t the Standing Committee o n
Collections.
Topic I. J. C r e d i t Statements o f Holding Corvorations
(see paragraph 19)
The sub-committee appointed b y the conference t o consider the topic
"Credit Statements o f Holding Corporations" filed its report with the conference.
Upon motion o f Governor Seay, i t was
VOTED t o adopt the report o f the sub-committee, a s follows:
It i s the opinion o f the conference t h a t where paper o f 2 corporation
which has allied, associated o r subsidiary companies i s offered for discount a t
a Federal Reserve Bank, the bank should require statements o f such allied, associated o r subsidiary companies a s of the same date, unless the statement o f the
company whose paper i s offered clearly indicates the eligibility and acceptability o f the paper; this procedure t o be adopted b y the Federal Reserve Banks
as promptly a s i s practicable.
Topic VI. A.» C o m m i t t e e o n Standardization o f
Accounting F o r m s .
The Chairman brought t o the attention o f the conference the vacancies
existing i n this committee.
A f t e r a short discussion, a n d upon motion o f
Governor Norris, i t was
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Federal Reserve Bank of St. Louis
WTED t h a t the committee b e discontinued,
Topic V i . B e R e i m b u r s e m e n t f o r e x e n s e s incurred
a/e W a r F i n a n c e C o r p o r a t i o n t r a n s a c t i o n s .
Governor Bailey r e a d a
memorandum showing t h e large volume o f business
mao e e
his bank i s handling for the War Finance Corporation a n d Stated that h e
felt reimbursement f o r overhead w a s desirable.
A f t e r discussion, however,
he said that h e desired n o action.
Topic Vi«-Gs R e i m b u r s e m e n t f o r Federal L a n d Bank
transactions +
Governor Bailey stated that his feelings were similar i n this
connection t o those expressed i n connection w i t h t h e foregoing topic, a n d
that his only object was t o obtain a n expression o f views.
Topic VI. FE. S h o u l d Reserve Accounts of Country
(
5
2
member banks receive adjustment f o r
currency i n transit.
Mr. Case asked n o action i n this connection, b u t stated t h a t h e
desired t o stress t h e desirability o f uniformity.
F e l l o w i n g discussion,
upon motion o f Governor Harding, i t was
VOTED t h a t i n the opinion o f the conference there i s no warrant
in the Federal Reserve Act or i n the Regulations o f the Board t o justify
the practice o f making adjustments i n the reserve accounts o f country member
banks f o r currency i n transit.
Topic: TVs B. E m p l o y e e s ’ Insurance.
There was a discussion o f the expense involved t o the various
banks o n account o f Employee Insurance, a n d the action taken b y the Boards
of Directors o f some o f the banks i n raising the maximum under the group
insurance plan to $5,000+« U p o n motion of Mr-e Case, i t was
VOTED t h a t t h e group insurance p l a n b e continued a n d that t h e
Federal Reserve Soard b e asked t o approve raising the maximum t e $5,000.
Topic IV. E.« D e s i r a b i l i t y o f having operating repre: s e n t a t i v e o n Federal Reserve Board's
Committee o n Economy a n d Efficiency.
Governor Calkins moved, and i t was
WTED t h a t the conference suggest t o the Board's committee o n
Economy and Efficiency that i t designate a n operating representative t o clear
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Federal Reserve Bank of St. Louis
)
o 92.6
information f o r the Keserve 3anks.
Tepic IV. C .
{ S e e paragraph 58).
R e p o r t o f Pension Committee
Upon motion o f Mr- Case, i t was
WTED t h a t the report (printed pages 550-563 stenopraphic record)
of the Pension Committee b e received a n d the recommendations contained therein approved w i t h t h e understanding t h a t t h e Pension Committee should commu-
nicate the action o f the conference t o the Federal Reserve Board, citing for
them all the steps that had been taken i n developing the pension plan, and
expressing t h e conviction o f t h e conference t h a t nothing could b e more benefi-+-
cial t o the operation o f the Federal Reserve System than the adeption o f some
such plan a s proposed.
Topic. Vij.A.
R e c e n t Amendments t o Federal Reserve ACt.
Go vernor Harding stated that h e had had a draft made o f all amendments t o the Federal Reserve Att within the last six months, o f which h e would
have copies distributed f o r discussien later.
T h e topic w a s temporarily passed.
Topic VIT.B. C a u s e s for nonmembership of state banks
(
5
7
and trust companies.
It was understood that n o action would b e taken o n this subject.
Before adjourning the Chairman called attention t o the topics suggested b y the Federal Reserve Board, a n d i t was understood t h a t these m a t t e r s
would not b e discussed until the jéint conference with the Federal Reserve Board.
At 6:00 o'clock p e me the conference adjourned t o reconvene a t 10:00
&- me i n joint session with the Federal Reserve Board o n Thursday, March 29th.
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Federal Reserve Bank of St. Louis
)
23 =
Fourth Day's Session, Thursday, March 2 9
Joint Session with Federal Reserve Board
(All Day)
The conference convened a t 10:00 o*clock a . m.
Present:
Honorables D. R. Crissinger, Edmund Platt,
C. S. Hamlin,and A. C. Miller, Members o f
the Federal Reserve Board;
Governors Harding, Norris, Fancher, Seay,
McDougal, Bigys, Young, Bailey,
McKinney a n d Calkins;
Deputy Governors Case and Adelson;
Mr. Barrows, A c t i n g Secretary.
In addition t o various matters of general policy (of which it is the
practice t o keep n o Secretary's minutes) a n d other topics which were
generally
discussed without conclusions being reached, t h e following matters which had
either been specifically referred t o the Governors b y the Board o r held over
for discussion with the Board were considered Popke
J V
D e s i r a b i l i t y o f having operating representative
on Federal Reserve Board's Committee o n Economy
and Efficiency.
( s e e paragraph 54)
The suggestion o f t h e Governors Conference t h a t t h e Board’s com-
mittee designate a n operating representative t o clear information for the
Reserve 5anks was referred t o by Governor McDougal i n reviewing the proceedings o f the conference.
I t was understood, a s suggested b y Mr. Miller, that
the Board would issue the monthly and quarterly reports o n the basis o f
Schedule E ("Report o f Expenses”) i n such reasonable numbers a s the banks may
severally request for the use o f their different departments.
The conference, after considering the following three Board topics
in separate session, took the following actions i n regard thereto, which i t
discussed w i t h t h e Board i n joint session.
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Federal Reserve Bank of St. Louis
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2 4
-
Board (1). R e s e r v e s against so-called "Special Savings". deposits
on which a
( 5 9 )
limited amount o f c h e c k i n g i s allowed,
Upon motion o f Mr. Gase, i t was
VOTED t h a t i t i s the sense o f t h e conference that n o change b e made
in the existing regulations.
Board (2). N e w Regulations.
Upon motion o f Mr. Case, i t was
VOTED t h a t a s the Governors feel that they have not had sufficient
opportunity t o thoroughly s t u d y a n d digest t h e tentative draft o f t h e N e w Regue
lations, they suggest that they b e permitted t o take the proposed regulations
home with them, with the understanding that after careful study e a c h Governor
will report his views direct t o the Board i n writing.
board (3). Limitation o n Aggrexate amount o f Agricultura: Paper
( 6 2 )
which m a y b e rediscounted b y Federal neserve sanks.
Upon motion o f Governor Calkins, i t was
VOTED t h a t n o change b e made i n the Board's limit o f 99% cf assets
for agricultural paper a n d that the limit o n nine months paper b e fixed a t 10%
ofassets.
TOpie 1. A< R e p o r t o f Committee o n Centralized Execution o f
Purchases a n d Sales o f Government Securities f o r
Account of Federal Reserve 3anks. ( s e e para. 9)
The Governors expressed themselves a s being i n favor o f the plan set
up i n the Board's memorandum X-3675, a n d with t h e establishment o f t h e Qpen
Market Investment Committee for the Federal Reserve System t o supersede o n and
after April 1, 1923, the present Governors Committee o n Centralized Execution
of Purchases a n d Sales o f Government Securities f o r Account o f Federal Reserve
Banks.
The Federal Reserve Board, u p o n t h e suggestion o f t h e Governors, a p =
pointed the members o f the old committee t o serve a s members o f the new com-
mittee. ( s e e X-3689 of April 7, 1923).
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Federal Reserve Bank of St. Louis
It was generally f e l t b y the Governors t h a t t h e Board's resolution
should b e construed s o that t h e banks should have some latitude i n making r e ~
tail intraxdistrict purchases o f acceptances.
Topic I. C. Rates of Discount. ( s e e paragraphs 11 and 31)
The report o f the committee o f Governors
o n "Rates o f Discount,”
dated March 28, 1923, adopted b y the conference was considered.
stood that t h e Federal Reserve Board would issue a
I t was under~
press statement a t the close
of the conference substantially i n the language o f the first paragraph o f the
statement which the committee i n its report recommended b e sent to the Federal
Reserve Soard,
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Federal Reserve Bank of St. Louis
At 6:30 o'clock p . m. t h e conference adjourned sine die.
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@FedFRASER