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538 A meeting of the Board of Governors of the Federal Reserve System with the Presidents of the Federal Reserve Banks was held in Washington on Monday, April 17, 1939, at 11:00 a.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman Szymczak McKee Davis Draper Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman Thurston, Special Assistant to the Chairman Mr. Wyatt, General Counsel Mr. Paulger, Chief of the Division of Examinations Mr. Smead, Chief of the Division of Bank Operations Mr. Goldenweiser, Director of the Division of Research and Statistics Mr. Parry, Chief of the Division of Security Loans Mr. Dreibelbis, Assistant General Counsel Mr. Vest, Assistant General Counsel Mr. Wingfield, Assistant General Counsel Mr. Leonard, Assistant Chief of the Division of Examinations Mr. Cagle, Assistant Chief of the Division of Examinations Mr. Van iossen, Assistant Chief of the Division of Bank Operations Mr. Thomas, Assistant Director of the Division of Research and Statistics Mr. Bradley, Assistant Chief of the Division of Security Loans Mr. Williams, Assistant Counsel Mr. Roland Robinson, Senior Economist in the Division of Research and Statistics Mr. Mr. Mr. Mr. 4/17/39 -2Messrs. Young, Harrison, Sinclair, Fleming, Leach, Parker, Schaller, Martin, Peyton, Hamilton, Gilbert and Day, Presidents of the Federal Reserve Banks of Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas and San Francisco, respectively Mr. Kimball, Secretary of the Presidents' Conference Chairman Eccles stated that the Presidents had been requested to came to Washington for the purpose of considering with the Board Problems presented by the recent introduction in the Senate of the Brown Bill (S. 2045), as well as actions that might be taken by the Federal Reserve System in the event of the outbreak of war in Europe. He then called upon Mr. Ransom to lead the discussion with respect to the problems presented by the Brown Bill. Mr. Ransom reviewed the circumstances under which the Brown Bill was introduced and stated briefly the reasons for his feeling that the bill was of unusual significance to the Federal Reserve SysHe outlined the problems which the bill presents and stated that the Board had received a request for a report on the bill from the Chairman of the Senate Banking and Currency Committee. He said that the Board and its staff had given considerable study to changes that might be made in the statutes relating to Federal banking supervision and, as the Presidents knew, had recoaimended to Congress that 4/17/39 a committee be appointed to study the whole banking and monetary field, but that the Board had not reached any decision with respect to a Program that might be suggested for consideration in response to a request from a Congressional committee if appointed. Mr. Ransom pointed out some of the conditions which would have to be taken into consideration in reaching any conclusions with respect to desirable changes in Federal banking laws and in that connection called attention to the chart contained in the Board's annual report depicting the confused Federal bank supervisory relationships and to a second chart showing the changes which would be effected in these relationships by the enactment of the Brown Bill. He called Upon the Presidents to discuss the questions (1) whether the Board's suggestion that a committee be appointed to study the banking and credit field was a desirable one, and (2) what should be the position Of the Board and the Presidents with respect to the solution of the Problems presented by the Brown Bill. In accordance with Mr. Ransom's request statements were made by Messrs. Harrison, Young, Day, Martin, Schaller and Peyton and their comments, together with comments made bYtir. Ransom and other members of the Board, were discussed. At 1:15 p.m. the meeting recessed and reconvened at 2:30 p.m. With the same attendance as at the morning session except that Messrs. Williams and Robinson were not present. Statements were then made by Messrs. Sinclair, Hamilton, 4/17/39 -4- Parker, Fleming and Leach. A majority of the Presidents, in the state- ments made by them at the morning and afternoon sessions, agreed with the suggestion that a Congressional committee should be appointed and expressed the opinion that action by Congress should be deferred until the entire field of money and banking could be surveyed by such a committee. During the ensuing discussion Mr. Ransom suggested that a procedure that might be adopted to determine upon the course of action to be followed by the System to meet the existing situation would be for the Presidents to request the legislative committee of the Presidents' Conference to study the matter and to confer with the Board with a view to working out a program that could be approved by the Board and the Presidents. He then requested the members of the Board to make such cwiments as they wished regarding the whole subject and statements were made by Messrs. Szymczak, Davis, McKee, Draper and Eccles. At the conclusion of the discussion which followed, Chairman Eccles suggested that the Presidents meet with the members of the Board again tomorrow morning at which time Mr. Goldenweiser would submit for consideration in the form of broad questions some of the More important problems in the banking and monetary field with a view to the determination by the Board and the Presidents upon a procedure M2 4/17/39 that might be followed by the Systn in preparing itself to make constructive suggestions at the proper time as to possible solutions. Chairman Eccles suggestion having been agreed to, the meeting adjourned with the understanding that it would reconvene tomorrow at 10-00 a.m. Assistant Secretary. APProve
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