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A meeting of the Federal Reserve Board was held in the Office of the Federal Reserve Board on Monday February 11, 1929, at 12:00 o'clock noon. PRESENT: Governor Young Mr. Platt Mr. Hamlin Mr. Miller Mr. Cunningham Mr. Eddy, Secretary !.r. McClelland, Assistant Secretary. The resAing of the minutes of the meeting of the Federal Reserve Board held on February 8th was dispensed with. The Governor presented letters dated February 8th from the Chairman cit the Federal Reserve Bank of Atlanta; February 8th from the Chairman of the l'eaeral Reserve Bank of Chicago and February 6th from the Governor of the Reserve Bank of St. Louis, replying to Board's letter of February 2/101 to the boards of directors of all Federal reserve banks on the subject Of the by ImProper use of the credit facilities of the Federal reserve banks member banks. After discussion, during which the Governor called attention to Particular statements contained in the above letters, they were ordered circulated among the members of the Board. During the discussion Mr. Platt expressed the opinion that the Federal Reserve System, in attempting to control the volume of credit being used for speculative purposes, should operate through discount rates, and stated further that in his opinion, if the Board is not willing to approve at once the five per cent rate fixed by the board of directors of the Federal Reserve Bank of Dallas, it should ask the directors whether they have given any consideration to a five and one half per cent rate. He moved -het the Secretary of the Board be instructed to telegraph the rederal Reserve Bank of Dallas and inquire whether the directors of the bank gave any consideration to an increase in rate to 5 1/2 %. Mr. Platt's motion, being put by the Chair, was lost, mr. Platt voting "aye". 2/11/29 -2- The Governor then submitted, with his approval, a report of the Committee on District No. 4 with respect to a proposal of the directors of the Federal Reserve Bank of Cleveland to purchase property now owned by the B°arli of Education in the City of Pittsburgh (150 feet front on Grant Street 4111i 132 feet on Strawberry Way) at a price of $1,188,000; the Committee Pqnting out that, even if the bank realized approximately $1,125,200, 411 it expects, from the sale of its present branch quarters and a portion of tlie new site, its total investment in land and proposed new building at Pittsburgh would still amount to approximately $2,328,800 as compared with Iltil)r°xialatelY $1,800,000 which will be spent at Los Angeles, and $1,766,599 " $1,817,327 spent at Detroit and Baltimore, respectively. The Committee INg:ested that the matter be again referred to the directors of the Cleveland t Batik with the recommendation that tney reconsider the proposal and try, in /MY, to work out a plan which will more netIrly approximate the expenditure in other comparable cities. After discussion, upon motion, the report of the Committee was adopted. Report of Committee on Salaries and. Expenditures on letter dated ?ebrIl arY 9th from the Chairman of the Federal Reserve Bank of Chicago, requesttoe a PProval of the action of the Executive Committee of that bank in voting to e 1"enci for a period of six weeks, or until April 1, with half pay, leave Of ab ee on account of illness granted Mr. Frank M. Huston, Manager of the Divisi (34 of Research and Statistics; the Board's Committee also recommending 4PProyal. Approved. Memoramium from Counsel dated. February 8th with respect to applications 2/11/29 -3- reT cancellation of stock in the Federal Reserve Bank of Chicago standing in tlle name of the First State Bank and The Carroll County State Bank, Mt. 19 Illinois, which have consolidated under the provisions of a " 4 atatute of Illinois, which under a ruling of the Supreme Court of that State, terminates the corporate existence of the consolidated banks; Counsel stating that in his opinion the two institutions may properly be considered to have it in substantial compliance with the provisions of the Federal Iteeerve Act, and, accordingly, the applications for the cancellation of Pederal reserve bank stock may properly be approved by the Board. Upon motion, it was voted to approve cancellation of 75 shares of stock in the Federal Reserve Bank of Chicago standing in the name of the First State Bank of Mt. Carroll, Illinois, and 90 shares standing in the name of the Carroll County State Bank of Mt. Carroll, Illinois. Memorndum from Counsel dated February 4th with respect to application tc3r the cancellation of stock in the Federal Reserve Bank of Minneapolis "anling in the name of the State Savings Bank of Laurium, Michigan, the alleets of which have been purchased by the Merchants and Miners Bank of net, Michigan; Counsel stating that advice has been received from the Comm; 'sstoner of Banking of the State of Michigan that the State Savings 13,thit 'as surrendered its charter and can no longer engage in the banking nese, and that in his opinion there is no legal reason why the cancellation or it 2 Federal reserve bank stock may not be approved. Upon motion, it was voted to approve cancellation of 135 Shares of stock in the Federal Reserve Bank of Minneapolis standing in the name of the State Savings Bank of Laurium, Michigan. Letter dated February 9th from the Federal Reserve Agent at Chicago, 'fit4 reference to membersnip in that bank by the State Bank of Ellsworth, Which has inquired whether, upon filing notice of intention to with- 2/11/29 -4- cll'el/ from the Federal reserve system, it could be permitted to transfer its 8 rve balance to a correspondent bank, wnicn at tne same time would take clrer its rediscounts at the Federal reserve bank; the Agent stating that lie has advised the member bank that under the law its reserve balance must be maintained until tne expiration of the six months' notice of intention to withdraw from tne system, the only way in waicn witndrawal can be eZIldited being for the Federal Reserve Agent to recommend to the Federal 've Board tnat appropriate action be taken to cancel such membership. Upon motion, the Secretary was instructed to request tne Federal Reserve Agent at Chicago to make a firm recommendation Oh the matter, advising tnat the Board will consider same promptly. ` --.. ( --)RT LSESTANDING COMMITTEES: Dated., February 11th, Recommending changes in stock at Federal Reserve Banks, as set forth in tne Auxiliary Minute Book of this date Recommendations approved. Dated, February Recommending approval of the application of Mr. 8th, Clarence M. Cornwell for permission to serve at the same time as officer of tne Valley National Bank, Des Moines, Iowa, and as officer and director of the First National Bank, Valley Junction, Iowa. Approved. Dated, February 9th, Recommending approval of tne application of Mr. H. S. Darby for permission to serve at the same time as officer and director of tne United National Bank, Troy, New York, and as officer and director of the Troy Trust Co., Troy, New York. Approved. 4ted, February approval of tne Recommending plication of Mr. Henry 9tn' ve at the same time as S. Ludlow for permission to director of tne United Natio Bank, Troy, New York, st Company, Troy, N. Y. as director of the Troy Approved. meeting adjourned a 41) Ved: Governo
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