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1538 A meeting of the Board of Governors of the Federal Reserve 8Ystein was held in Washington on Monday, August 3, 1942, at 2:15 p.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman Szymczak McKee Draper Evans Mr. Morrill, Secretary Mr. Bethea, Assistant Secretary Mr. Carpenter, Assistant Secretary The action stated with respect to each of the matters herein"ter referred to was taken by the Board: The minutes of the meeting of the Board of Governors of the 8-1 Reserve System held on August 1, 1942, were approved unanimously. 1Pe(1 " Telegram to Mr. Ashley, Assistant Federal Reserve Agent at the Fedn-111. Reserve Bank of Dallas, reading as follows: "Board approves appointment of George William Stover !e Federal Reserve Agent's Representative at the El Paso branch, at his present salary of $2,400 per annum, to succeed Grover C. Page, effective upon Mr. Page's resignation, alld in accordance with the terms of your letter of July 29, 1942.11 Approved unanimously. Letter to Mr. Baker, Manager of the Consumer Credit Department, Peas— . j Re serve Bank of Minneapolis, reading as follows: "In your letter of July 23, 1942, you stated that 7 211 have advised a Registrant that, by virtue of the ‘JemPtion in section 8(a) of Regulation W, such Regis1 ,411t may make a loan, secured by bona fide first lien 0, imProved real estate duly recorded, to refinance an t-eneion of credit originally made by another RegisOn terms violating the Regulation. 1539 8/3/42 -2- "The Board agrees with the view that a loan covered by the exemption of section 8(a) is not affected by the restrictions and reouirements of the Regulation; and use Of the Proceeds as indicated above would not constitute an exception to such view. "While receipt of payment by the Registrant making the original extension of credit, which you indicate was it violation of the Regulation, night very well be prohibited by section 3(a)(2), it is the Board's view that, unless the Registrant making the loan to refinance such Original extension of credit participated in the violation relating thereto, his conduct in making funds available for payment of the original extension of credit should not be deemed a participation in the violation that may result from the receipt of payment by the original Registrant." Approved unanimously. Letter to Mr. R. J. Tobin, President of the Tilo Roofing Company, ille*) Stratford, Connecticut, reading as follows: "This will acknowledge and thank you for your letter 1111Y 21, 1942, enclosing a report of your Engineering "ePartment concerning the reduction of heat loss which Would be expected to result, under specified conditions, from the application of your siding and roofing products rer present walls and roofs of existing structures. This -Lnformation was given careful consideration in the studies which led up to the adoption of Amendment No. 6 to RegulatiOfl W, a copy of which is enclosed. "The special exemption provided by Amendment No. 6, "YOU will note, applies in general only to materials which are used wholly or mainly as insulation rather than as structural parts. In deciding not to include such materials as .ding and roofing, after giving due weight to their value 471 reducing heat loss, the Board was influenced by counterlrElilinq considerations, including the undesirability of ;?lexins the restrictions of Regulation 17 over a wider ,:keld than necessary for the immediate purpose. There seemed, on the whole, to be good technical grounds for ' awine; the line at the point where it is dram by AmendThl ment No. 6. V "As the President stated in his message to Congress April 27, the curtailment of consumer credit is one of the necessary steps to be taken as a part of the program 1_540 8/3/42 -3- "to neutralize the forces working toward the advance of Prices. The regulation of such credit can be relaxed only When circumstances, such as the acute shortage of transPortation facilities for fuel, develop an urgent necessity for special treatment of some particular class of credit and then relaxed only to the extent required to meet the Particular situation that has developed. "'Tour comments on this subject, as well as those received from other interested parties and from a number of interested Government agencies, have been most helpful. lye should like you to feel that the question in which you are interested, and which has been decided for the present at least, is one that the Board has taken seriously and has tried to decide as best it can in the light of all the relevant considerations." Approved unanimously, with the understanding that a copy of the above letter would be sent to the Presidents of all the Federal Reserve Banks. Thereupon the meeting adjourned. _eaa,15Elb APProiTed.: Chairman. Secre ary.
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