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Minutes of actions taken by the Board of Governors of the Federal Reserve System on Wednesday, August 22, 1951. PRESENT: Mr. Martin, Chairman Mr. Evans Mr. Vardaman Mr. Carpenter, Secretary Mr. Kenyon, Assistant Secretary Memorandum dated August 20, 1951, from Mr. Carpenter, Secretary Of the Board, recommending the appointment of Miss Elizabeth Anne Shadwe11 as a File Clerk in the Office of the Secretary, on a tempola/ indefinite basis, with basic salary at the rate of $2,730 per annum, effective as of the date upon which she enters upon the performance of her duties after having passed the usual physical examination and subject to the completion of a satisfactory employment investigation. Approved unanimously. Memorandum dated August 16, 1951, from Mr. Young, Director, -.Lon of Research and Statistics, recommending that Frank R. Garfield, Advis er on Economic Research, be authorized to sign during the absence (I't the Director or during periods when the Assistant Directors of that 13i1Tisicrl are not available to perform their usual responsibilities all tePortel vouchers, and memoranda normally requiring the signature of the head of that Division. Approved unanimously. Letter to Mr. Wiltse, Vice President of the Federal Reserve 844k or New York, reading as follows: 8/22/51 -2- "In accordance with the request contained in your letter of August 16, 19510 the Board approves the appointment of J. Edward Messer as an assistant examiner for the Federal Reserve Bank of New York. Please advise us of the date upon which the appointment becomes effective." Approved unanimously. Letter to Mr. Earhart, President of the Federal Reserve Bank of San Francisco, reading as follows: "Thank you for your letter of July 19 containing a more detailed program for the Central Banking Seminar in September. Our plans have also become somewhat more definite and it now looks as if Mr. Woodlief Thomas, Mr. Merritt Sherman, and Mr. Kenneth B. Williams will be able to represent the Board at the conference. If nothing interferes with this arrangement, Mr. Sherman will discuss 'Organization of the Board of Governors--Methods of Operation' and ' Publications, Teaching Aids.' Mr. Thomas will be prepared to discuss monetary and fiscal policy matters and also to lead a general discussion of the Consumer Finances Survey. Mr. Williams will be prepared to discuss the business situation, including the use of data from the money flows project. "The dates set for the participation of the Board's Staff in the general outline appear to be quite satisfactor!. You will probably want Mr. Thomas to participate in the dlacussion of foreign operations with special reference to the relation of the System to the International Monetary Fund, the International Bank for Reconstruction and Development, and the National Advisory Council." Approved unanimously. Letter to Mr. Guy, Assistant Secretary of the Federal Reserve Bank of New York, reading as follows: . "This will acknowledge your letter of August 14, 1951, dvl ng that the executive committee of the board of direct ors has granted a leave of absence with pay, for a Period of two weeks beginning August 13, to Mr. Alfred Von !si I 8/22/51 -3- "Klemperer in order that he may assist the Exchange Restrictions Department of the International Monetary Fund ln a staff study. "The Board of Governors will interpose no objection to the arrangements indicated in your letter." Approved unanimously. Letter to Mr. Everson, Assistant Vice President of the Federal Reserve Bank of San Francisco, reading as follows: "This refers to your letter of July 25, 1951, regarding the status under Regulation W of a television rental plan outlined in the letter from Video Meter, Inc., San Francisco, Which you enclosed. "The conditions proposed for rentals of television sets as outlined would not in the Board's opinion qualify the transactions generally for exemption under Regulation W. "As you know, the question whether articles are listed or not under the regulation is not answered by the use to which the articles are put but by their design. Hence, television set rentals would not be exempt merely because the sets were rented for 'commercial! use. "The Board on occasion in the past has taken the posia-cn that certain articles would not be subject to the regution if they were designed exclusively for commercial use and not readily adaptable to household use, but few television receiving sets would quAlify for exception on this basis and aPpears in any event that the sets in question are not designed for commercial use. "Since as we understand the proposed procedure, Video Mister, Inc. would be the lessor, the transactions apparently ( Ic/111(1 not qualify for exemption as credit to finance a lessor retailer) under section 7 (c). "Such rental transactions would be exempt, of course, guere the value involved exceeded $2,500." r Approved unanimously. Memorandum dated August 21, 19510 from Mr. Townsend, Solicitor, 'tatt. AT that the Federal Reserve Bank of San Francisco had reported 4141041.0 U8 apparent violations of Regulation WI Consumer Credit, by Allan 8/22/51 -14- Gordon and Eli Temkin, partners, doing business as The National Stores, with offices at 3332 W. Olympic Boulevard, Los Angeles, California, 14505 Delano Street, Van Nuys, California, and 71 South State Street, Salt Lake City, Utah; and recommending that in accordance with the reco mmendation of the Reserve Bank, the Board adopt an order for investigation as follows: "UNITED STATES OF AMERICA BEFORE THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM At a meeting of the Board of Governors of the Federal Reserve System held at its offices in the City of Washington, D. C. on the 22d day of August, A. D., 1951. --.1-" r—iratter of it Tlel I,T;LLAN GORDON and ELI TEMKIN, ORDER DIRECTING INVESTIGATION fartners doing business as AND DESIGNATING OFFICERS TO TAKE TESTIMONY. Me Na-onalStores. Members of the staff of the Federal Reserve Bank of San Franc. have reported information to that Bank, which that Bank 4443 transmitted to the Board, which tends to show that: Allan Gordon and Eli Temkin, partners doing business as The National Stores, with offices at 3332 W. Olympic Blvd., Los Angeles, California, 14505 Delano St., Van Nuys, California, and 71 South State St., Salt Lake City, Utah, have made instalment sales of new and rebuilt sewing machines subject to Regulation W, consumer credit: 1. Without obtaining the down payment required by Regulation W; 2. Without maintaining and preserving such books of account, records and other papers as are relevant to establishing whether or not credit extended by them is in conformity with the requirements of said Regulation. II The Board having considered the aforesaid report by members Ulethe staff of the Federal Reserve Bank of San Francisco and for lia_Purpose of (1) determining whether Allan Gordon and Eli Temkin " violated the provisions of Regulation W and (2) aiding in the 4 V22/51 -5- "enforcement of said Regulation, deems it necessary and appropriate , /lat an investigation be made to determine whether Allan Gordon and 411 Temkin have engaged in the acts and practices set forth in paragraph I hereof, or any acts and practices of similar purport or object. III IT IS ORDERED, pursuant to Section 604 of the Defense Production Act of 1950 that an investigation be made to determine the matters set forth in paragraph II hereof. IT IS FURTHER ORDERED, pursuant to the provisions of Section 6°4 of the Defense Production Act of 1950 that for the purpose of Tich investigation John A. Mane and K. F. Scott, and each of them, hereby designated an officer of the Board and empowered to ad1.ylister oaths and affirmations, subpoena witnesses, compel their attendance, take evidence, and require the production of any books, papers, correspondence, memoranda, or other records deemed relevant material to the inquiry, and to perform all other duties in conn ction therewith as authorized by law. By the Board. (signed) S. R. Carpenter, Secretary." Approved unanimously, with the understanding that if circumstances should warrant taking other action, a further recommendation would be presented to the Board.
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