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20P Minutes of actions taken by the Board of Governors of the The Board Federal Reserve System on Wednesday, December 9, 1953. met in the Board Room at 9:30 a.m. PRESENT: Mr. Martin, Chairman Mr. Szymczak Mr. Evans Mr. Vardaman Mr. Mills Mr. Robertson Mr. Carpenter, Secretary Mr. Sherman, Assistant Secretary Mr. Kenyon, Assistant Secretary Mr. Thurston, Assistant to the Board Mr. Thomas, Economic Adviser to the Board ch Mr. Young, Director, Division of Resear and Statistics Mr. Johnson, Controller on Mr. Sprecher„ Assistant Director, Divisi on of Personnel Administrati on of Mr. Noyes, Assistant Director, Divisi Research and Statistics December 3) 1353, from There was presented a memorandum dated on, recommending, Mr. Allen, Director, Division of Personnel Administrati for reasons stated, that the Board authorize the Division of Personnel each employee in the Board's Administration to make arrangements for annually, the examination cafeteria to be given a physical examination on to the regular physical to include a chest x-ray and blood test in additi check-up. of such a program would be The memorandum stated that the cost 410Proximately $100 annually. Approved unanimously. circulated among the members Prior to this meeting there had been Thomas to Mr. Bryan, Of the Board a draft of letter for the signature of Mr. 202 12/9/53 -2- President of the Federal Reserve Bank of Atlanta, reading as follows: With regard to the 1954 Meeting of Technicians of Central Banks of the American Continent, decision has to be made as to the representation of the Federal Reserve Banks. While it would be fine to have representa ngs, tives from all of the Reserve Banks at all the meeti of this would probably not be advisable, partly in view avoid space limitations but more importantly in order to having the Conference over-weighted with representatives from this country. It has occurred to us that the decision could best by be made by the Conference of Presidents rather than fore, in the Board and the New York Reserve Bank. There ComStaff my capacity as Chairman of the Federal Reserve the with mittee of Technicians which has been entrusted writing to working out of plans for the meeting, I am Presidents suggest that the Research Committee of the this matter. in sal propo the Conference undertake to make until spring, made be to have A definite decision does not but some plan should be worked out before then. in case One suggestion that has been made is that, of half d, atten to want a number of the Reserve Banks ngton and those represented attend the meeting in Washi York. New in the other half attend the meeting here In this connection, I may say that the group the for a agend the and in New York who are laying out Charlie Taylor's Meeting are all very favorably impressed by be among the banks suggestion and we hope that Atlanta will elements of souththe on represented. We feel that a paper suggestion would ern economic growth along the lines of his should like for We fore be of considerable interest. There ring such a paper prepa for you people to go ahead with plans and for presenting it at the Meeting° will be March 12 The final date for submitting papers ing Central cipat parti 1954, as We are informing the other papers subthe of h lengt Banks. There is no limit to the of not ry summa a by ded mitted, but each should be prece . more than two single-spaced pages Spanish translation It will be necessary to provide a . However, if paper the as well as the English version of 20. t") 12/9/53 it is inconvenient for your Bank to arrange for the translation into Spanish, Ae c;?ri have that done here. Approved unanimously. In accordance with the understanding resulting from a discussion of the proposed Board budget for 1954 which had been held in executive session, with the Controller present, and in the light of the suggestion made by Chairman Martin when he met with the heads of the respective divisions last week, the divisions had reviewed their proposed budgets with a view to eliminating or deferring everything not essential for the effective discharge of the Board's current responsibilities. At this meeting there was a discussion of an alternative 1954 budget for the Division of Research and Statistics, the proposed changes being set forth in a statement prepared by that Division, copies of which were distributed to the members of the Board. During this discussion it was agreed unanimously: (1) That the two interim surveys of consumer finances which were approved by the Board at the meeting on October 26, 1953, should not be conducted in 1954, and that the $75,000 provided for the interim surveys should be eliminated from the 1954 budget of the Division of Research and Statistics. (2) That publication of the "all-bank" balance sheet statistics covering the period 1896-1950 should be postponed and that the $35,000 provided to cover the cost of publication should be eliminated from the 1954 budget of the Division of Bank Operations. 209; -- 12/9/53 r (3) That the Associated Press ticke the 1954 and service should be discontinued budget provisions for this service eliminated. That Mr. Young should be relieved of the assignment given to him at the meeting on June 9, 1952, to study the problems which would be involved in having the surveys of consumer finances conducted by the Federal Reserve System. (4) ditures which There was discussion of other contemplated expen Johnson made a statement might be eliminated or deferred during which Mr. al divisions in reducing regarding the progress being made by the sever total budget of the Board their originally proposed budgets so that the as the 1953 budget. for 1954 might be of approximately the same size divisions had submitted It was understood that after all of the analyzed them, the Contheir revised proposals and the Controller had the Board for further controller would present the revised budget to sideration. and Messrs. Leonard, Mr. Noyes then withdrew from the meeting Budget and Expense Section; and Director; Farrell, Chief, Reserve Bank Bank Operations, entered the Massey, Technical Assistant, Division of Assistants to Mr. Thurston. room along with Messrs. Fauver and Molony, meeting on December 4, 1953, Pursuant to the understanding at the proposed Federal Reserve Bank there was a further discussion of the regard to expenditures chargeable budgets for 1954, particularly with to bank and public relations activities. 12/9/53 General In the course of the discussion, during which Mr. Vest, was made to the responsi— Counsel, was called into the meeting, reference respective Federal Reserve bility of the directors and officers of the ive dis— Banks to keep expenses to a minimum consistent with the effect to carrying out the charge of functions which are proper and essential ity and extent of re— duties of the Federal Reserve System, the author to Federal Reserve sponsibility of the Board of Governors with respect it was felt that Bank budgets and expenditures, and methods by which might be achieved Objectives common to the Board and the Reserve Banks System as presently consti— Within the framework of the Federal Reserve tuted. should be taken by Consideration also was given to what action Bank budgets. Several the Board concerning the proposed 1954 Reserve letters which might be sent suggestions were made as to the content of or Evans and to the Reserve Banks, and it was understood that Govern discussion at this meet— Mr. Leonard would prepare, in the light of the the meeting on December 14, ing, a draft of letter for consideration at given to salaries proposed 1953, at which time attention also would be January 1, 1954, including for Federal Reserve Bank officers, effective first vice presidents. salaries proposed for the presidents and The meeting then adjourned. During the day the following addi— with all of the members present: tional actions were taken by the Board 2095 -6- 12/9/53 Minutes of actions taken by the Board of Governors of the Federal Reserve System on December 8, 1953, were approved unanimously. Telegram to Mr. Lester V. Chandler, Gordon S. Rentschler Pro, prefessor of Economics, Princeton University, Princeton, New Jersey er 1, 1953, and pared pursuant to action taken at the meeting on Decemb reading as follows: has Board of Governors of the Federal Reserve System Bank e appointed you a Class C director of Federal Reserv January 1, of Philadelphia for three-year term beginning col1954, and will be pleased to have your acceptance by statelect telegram. The Board will issue later a press l Reserve ment on appointments of directors at all Federa announcement Banks and Branches. It will be appreciated if e of Board's releas until ed of your appointment could be deferr statement. Approved unanimously. l Reserve Bank of Letter to Mr. Diercks, Vice President, Federa Chicago, reading as follows: er 1, 1953, Reference is made to your letter of Decemb t, Detroi Bank, t advising of the proposal of The Detroi , Office Road Mile ven Michigan, to remove its Livernois-Se t, Detroi e, Avenu presently located at 19100 Livernois is within one Michigan, to 18900 Livernois Avenue, which and Seven Avenue block of the intersection of Livernois Mile Road. tutes We concur in your view that this proposal consti ate the in immedi a mere relocation of an existing branch nature of its business neighborhood without affecting the the approval of the or customers served, and, therefore, Board of Governors is not necessary. Approved unanimously. -7- 12/9/53 Letter to Mr. J. E. Reeve, Assistant Chief, Commerce and g Finance Division, Bureau of the Budget, Washington, D. C., readin as follows: This refers to your memorandum of December 72 1.953, ing a in which you request the views of the Board regard set as tentative proposal of the Treasury Department, 1, forth in your attached copy of a letter of December to Folsom 1953 from Acting Secretary of the Treasury Mr. Dodge, that the tax exemption of interest from future issues of local public housing authority bonds be discon tinued. of The Board had occasion to consider the question y 4, Januar of the tax exemption of such bonds in its letter that In . Budget 1949 to Mr. Staats of the Bureau of the matter: letter the Board stated with respect to this general the "...The Board would like to raise ties securi question whether such use of tax-exempt ated. stimul should not be discouraged rather than pro"Federal credit, contributions, and grants (this for vide an appreciable part of the security however, type of obligation)...in the past decade, been has income from Federal obligations generally l Federa and made taxable by the Federal Government, Under tax rates have been increased substantially. to enthe circumstances, it would seem undesirable the to courage through this bill further additions supply of tax-exempt issues." t to the The Board is still of that opinion with respec ingly, is intax exemption of such obligations, and, accord Treasury in this clined to agree with the suggestion of the regard. Approved unanimously. a Secretary
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