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2,3r, A meeting of the Board of Governors of the Federal Reserve SYStem was held in Washington on Friday, February 17, 1939, at 10:30 • in. PRESENT: Mr. Mr. Mr. Mr. Mr. Eccles, Chailman Ransom, Vi ce Chairman Szymczak McKee Draper Mr. Morrill, Secretary Mr. Bethea, Assistant Secretary Mr. Clayton, Assistant to the Chairman Mr. Wyatt, General Counsel Mr. Goldenweiser, Director of the Di-vision of Research and Statistics Mr. Dreibelbis, Assistant General Counsel Mr. Wingfield, Assistant General Counsel There were presented telegrams to Mr. Young, President of the --I- Reserve Bank of Boston, Messrs. Kimball, Post and Hays, Secretallee of the Federal Reserve Banks of New York, Philadelphia and Cielrelands respectively, Mr. McLarin, Vice President of the Federal Rase,. 4.ve Bank of Atlanta, Mr. Caldwell, Chairman of the Federal Reserve c't Kansas City and Mr. Hale, Secretary of the Federal Reserve Bank Or sa, Francisco, stating that the Board approves the establishment Tiritil°4t change by the Federal Reserve Bank of San Francisco on February 14 '15Y* the Federal Reserve Banks of New York, Cleveland, Kansas City San Francisco on February 16, 1939, and by the Federal Reserve 13"k8 of Boston, Philadelphia and Atlanta today, of the rates of dise°1111t ' elld Purchase in their existing schedules. Approved unanimously. 2/17/3g -2Mr. Ransom stated that Chairman Wagner of the Senate Banking 414 Currency Committee, in a letter dated February 15, 1939, had req4ested an expression of the Board's opinion on the merits of the 138 'ItleY bill (S. 477 - Trust Indentures) and that he had asked Mr. kratt to prepare a tentative draft of a report on the bill for disc4ssion at this meeting. In this connection, Mr. Ransom said that, sillee the Board had now been requested to submit a report expressing itsviews on the substance of the proposed legislation, he felt that he informal arrsngement under which he and the Board's Counsel had 11°Iited with representatives of the Securities and Exchange Cammission 'With regard to the technical provisions of the bill should be regarded es t erminated and that he would advise Chairman Douglas accordingly. The other members agreed with DA', . Ransom. In the course of the discussion which followed, Mr. McKee ellegested that, in view of the existing understanding that reports "e not to be made on pending bills except in certain circumstances, Ir°te be taken to determine whether the members of the Board were in Etereenent on the question of compliance with the request of the Senate teive4 --'ng and Currency Committee. Upon motion duly made it was thereupon decided by unanimous vote that the Board should prepare and submit to the Committee in response to its request a formal report on the merits of the proposed legislation. 298 2/17/39 -3After further discussion Mr. Wyatt, at Mr. Ransom's request, read the tentative draft of report which he had prepared. Several members of the Board suggested changes which they felt should be made and it was unanimously agreed that the matter should be listed on the docket for consideration at a meeting of the Board on Tuesday, February 28, 1939, it being understood that in the meantime the preliminary draft of report would be revised in the light of suggestions received from mambers of the Board and its staff. It was also understood that Senator Wagner would be advised informally that the Board had decided to submit a report with respect to the proposed legislation, that the Board's staff is engaged in preparing such a report, and that it is expected that the report will be ready for submission to the Committee within the next ten days or two weeks. There was then presented a statement prepared by Messrs. Wyatt Goldenweiser under date of February 13, 1939, containing comments Ox bills to stabilize prices. The matter had been placed on the docket r" discussion at the request of Mr. Ransom and a copy of the statehad been furnished to each member of the Board before this meet- Chairman Eccles stated that, since it was his understanding tliat a number of changes in the text had been suggested, he thought eclIel ' ideration of the matter should be postponed until a subsequent rileeting• He then suggested that another draft be prepared and that tilllatter be taken up by the Board at the meeting to be held Illesday, February 28, 1939. The other members of the Board agreed unanimously to this disposition of the matter. 011 2:r 2/17/39 -4At this point Messrs. Wyatt, Goldenweiser, Dreibelbis and Wiflfiid left the meeting and the action stated with respect to each the matters hereinafter referred to was then taken by the Board: The minutes of the meeting of the Board of Governors of the Fecie ral Reserve System held on kebruary 16, 1939, were approved unani- Mously. Letter to the Attorney General of the United States, reading as follows: "Pursuant to the request contained in your letter °f February 11, 1939, there is enclosed herewith a certified copy of the report of condition received by the Board of Governors of the Federal Reserve System from the Citizens Commercial Trust and Savings Bank of Pasadena, Pasadena, California, as of Tune 30, 1936." Approved unanimously. Letter to Mr. V. C. Kunz, Assistant Cashier, The Chase Bank, New New York, reading as follows: "This refers to your letter of February 10, 1939, stating that, in connection with the issue and sale of travelers' checks under the authority contained in the 80ard's letter of September 23, 1938, your bank finds it desirable also to issue and sell letters of credit pay"le solely in blocked currencies of foreign countries. "It is understood that the issue and sale of letters eredit payable in blocked currencies of foreign coun'ries will be handled in a manner similar to the issue and sale of travelers' checks by your bank in accordance vlitn the Board's letter of September 23, 1958. It is 50 Understood that the issue and sale of letters of credit by your bank in the United States will be inci-Ft-tal to, or for the purpose of, carrying out transaclons in foreign countries or dependencies of the United n I 240 "States where The Chase Bank has established agencies branches, or correspondents. "On this basis, you are advised that the Board of Governors approves the request contained in your letter to issue and sell letters of credit." Approved unanimously. Thereupon the meeting adjourned.
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