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307 -A. meeting of the Federal Reserve Board was held in the office of the Pederal Reserve Board on Wednesday, April 11, 1928, at 12:20 p.m. P1E3ENT: The Governor Young 1.1r. Platt Yr. Hamlin Mr. Miller Mr. James McIntosh Mr. Noell, Assistant Secretary Governor stated that Governor McDougal had called him on the tele- 13411e this morning from Chicago and advised that banks in Chicago have in°,2c1, their over-the-counter rate about 1/4 of 1/0 the minimum rate being Oil commercial paper to customers, and also that the rate to bond dealer tele and others had gone up to 4 3/4. He also stated that he had a vuone conversation with Deputy Governor Case of the Federal aeserve Bank Of New York, who advised him that a meeting of some of the directors of the 13141111:h ed been held on Monday and a meeting of officers this morning, at which thePresent situation was discussed. Mr. Case, he stated, advised him that the ''ePort this week will show a reduction of approximately .„15,000,000 in the Peri market Investment Account and that during the next week they have lii selling approximately ,20,000,000 to .25,000,000 of Government securities , 41.01m the Account for the reason that while the banks now owe „;240,000,000, there would be a further return of holiday currency which would relieve the aituat, 'n in New York to a certain extent and they wanted to keep a grip on the Present situation. He stated that he had advised Mr. Case that there wo414 4 be no objection to the sale of securities as contemplated. ' he Governor further stated he had inquired of Yr. Case whether there 414 be n e- any discussion of discount rate at the meeting and was advised that °tie or the directors talked about it at the last meeting and it would be 308 Via/28 Seus Bed very thoroughly at the meeting to be held tomorrow, although Mr. Casa thought it perfectly safe to assure him that there would be no request fOr a rate increase tomorrow although there might be later. During the discussion which followed, Mr. McIntosh left the meeting. /14r. Miller then offered the following resolution, which at his request Was laid upon the table for future consideration: "That it be the sense of the Board that a separate rate be established for advances, said advances being defined as funds Obtained from the Federal Reserve banks on bills payable or on securities negotiated under repurchase agreement, and that such rate be 1,0 in excess of the discount rate; and Counsel is instructed to prepare drafts of amendment of existing regulations Of the Federal Reserve Board in order to give effect to this change s' , Purther discussion then ensued, during Which Governor Young was requested to "'Ivey to Governor Harding of the Federal Reserve Bank of Boston, and Mr. Csee 'Deputy Governor of the Federal Reserve Bank of New York, advice of the resoi ution offered by Mr. Miller and to convey to the Board their reaction thereto. The meeting adjourned at 1:00 p.m. Assistant Secretary. Al)proveci: Governor.
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