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A meeting of the Federal Reserve Board with the Open Market Policy Conference was held in the office of the Federal Reserve Board on TUesday, April 12, 1932, at 10:00 a. in. PRESENT: Governor Meyer Mr. Hamlin Mr. Miller Mr. Tames Mr. Magee Mr. McClelland, Assistant Secretary Mr. Harrison, Assistant to the Governor Mr. Goldenweiser, Director, Division of Research and Statistics Mr. Smead, Chief, Division of Bank Operations PRESENT ALSO: Messrs. Young, Harrison, Norris, Fancier, Seay, McDougal, Martin, Geery, Hamilton, McKinney and Calkins, members of the Open Market Policy Conference. Mr. Burgess, Secretary of the Conference. A discussion ensued during Which the general credit and business situation and the open market policy of the Federal Reserve System were reviewed in detail. The Secretary of the Treasury joined the meeting While the discussion was in progress and at its conclusion the members of the Board and its staff withdrew from the roam and a separate meeting of the Open Market Policy Conference was held. At 2:45 p. in. the meeting of the Board reconvened, in the office of the Governor. The Secretary of the Treasury, Governor Meyer and Messrs. Hamlin, Miller, Tames, Magee and Pole, members of the Board, Yr. McClelland, Assistant Secretary and Mr. Harrison, Assistant to the Governor, were present. The Governor presented a report which had been handed to him by the Secretary of the Open Market Policy Conference, reading as follows: • 306 4/12/32 -2"The Conference voted that, subject to the approval of the Federal Reserve Board, the executive committee be authorized to purchase up to ::)500,000,000 of Government securities in addition to the unexpired authority granted at the meeting of the Open Market Policy Conference on February 24, and that these purchases, at least in the initial weeks, should be at a rate as rapid as may be practicable and if possible should amount to 100,000,000 in the current statement week." After some discussion, upon motion, it was voted to approve the action of the Conference, as recited in the above report. The members of the Board then adjourned to the Board room for a further meeting with the Open Market Policy Conference. Messrs. Harrison, Goldenweiser, Smead and McClelland of the Board's staff were also present. The discussion centered on the question of the free gold position of the Federal reserve banks and whether any action should be taken by the Federal Reserve Board at this time, in connection with the open market program Which has been decided upon, to authorize the Federal reserve banks, under the provisions of Section 16 of the Federal Reserve Act, as amended by the Act of February 27, 1932, to pledge Government securities with the Federal Reserve Agents as collateral for Federal reserve notes. AB the discussion Progressed it developed as the consensus that the additional purchases of securities to be made during the current statement week under the program Which has been adopted could, if necessary, be absorbed by the Federal Reserve Bank of New York, which has a substantial amount of free gold, and that, subject to the approval of their Boards of Directors, next week's purchases should be participated in by all Federal reserve banks to whatever extent may be Practicable in view of their respective free gold positions and beginning With the third or fourth week of the program each Federal reserve bank should take its pro rata share of the securities purchased, it being understood that 4/12/32 as the necessity therefor develops the Federal Reserve Board will act Promptly upon requests from the banks for authority to pledge Government aeaurities with the Federal Reserve Agents as collateral for Federal reserve Thereupon the meeting of the Board adjourned. t1 Assistant Secretary. APproved:
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