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Th At a joint meeting of the Feceral Reserve 13oard held ih the •Federal Aavisor;, Council on Monday, Feb- ruary is., at 10/30 PRESENT:. Mr. Harding, presiding,: Mr. Hamlin, Mr. Warburg„ Yr. Willis, Secrotary. Mr. Miller, Present also: Mr. Forgan, Mr. Morgan, Mr. Record., Mr. V;utts, Ur. Fleishhacker, Mr. Swinney, Yr. Ro;;(3,,k!r. Rue,, Mr. Wing„ Mr. Mitahell,.kr. Lyerly, Mr. Norwood.. President Forgan offered brief introductory remarks, and was folloaed by Governor Harding who sketched the various topics on which the Board desired the udvice of the Council. Fe referred particularly to the question of dividinE the membership of the Council into three classes, each class to retire at different dates, in order to 1,,uvent tne membership from changin too eudaenly. He tnen considered the pending House and Seni.to bills providint, for amendment to the Federal r.eserve Act, und indicated the chief points of difference between them. In answer to quetions from members of the Council with reference to the 9 Board's foreign agency policy, he stated what had actually been done by the 7oard thus far; referred briefly to the difficulties in the L;ranish exchange situation, and outlined the probable scope of agency relations. Governor Harding then referred to the aibtreasury question and the policy that should be pursued in the operation of Subtreasuries in their relation to the reserve banks, as a matter on which the advice of the 2ouncil was desired. "Je then referred particularly to the vestion of the discount policy of the reserve banks, and the future plan to be worked out in that connection, asking for the council's suggestion. lovernor Harding further requested the views of the Jouncil on the best policy to be pursued in connection dith the issue of Government bonds. He next referred to the domestic exchange question, and told of the Board's decision to engage a clearing expert xith the view of est4Llishing of a special exchange bureau in the Board. ''his matter was also brought bet'ore the Jouncil for such suggestion as it might choose to offer. General discussion ensued with reference to the Board's policy on the foreign a2:ency and branch tuestion, 7r. Rue of •1,-,t50 Philadelphia particularly asking the Board's probable plans in connection with the development of purchases of tills of exchange abroad. Tie feared that such opera- tions might be engaged in too largely, and called attention to the fact that the whole market for acceptances was practically in the hands of the Federal reserve banks, and that funds should not be withdrawn too suddenly or too largely therefrom. He called attention to the fact that thus far no market for acceptances has been developed among country banks, existing acceptances being too large. ir, Warburg noted that this was largely the fdalt of member banks themselves, which ought to put the paper into satisfactory denominations, and ought also to abandon the practice of discounting their own acceptances. By building up the country bank market for acceptances, a greater stability and breadth will be given to the market. At 11.10 a.m. the joint session adjourned. _iP)VLD Socretary.
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