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Go9
9/61
Minutes for February
To:
Members of the Board
From:
Office of the Secretary
9, 1962
Attached is a copy of the minutes of the
Board of Governors of the Federal Reserve System on
the above date.
It is not proposed to include a statement
with respect to any of the entries in this set of
minutes in the record of policy actions required to
be maintained pursuant to section 10 of the Federal
Reserve Act.
Should you have any question with regard to
the minutes, it will be appreciated if you will advise
the Secretary's Office. Otherwise, please initial
below. If you were present at the meeting, your
initials will indicate approval of the minutes. If
you were not present, your initials will indicate
only that you have seen the minutes.
Chm. Martin
Gov. Mills
Gov. Robertson
Gov. Balderston
Gov. Shepardson
Gov. King
Gov. Mitchell
Minutes of the Board of Governors of the Federal Reserve
System on Friday, February 9, 1962.
The Board met in the Board
Room at 10:00 a.m.
PRESENT:
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Mr.
Martin, Chairman
Balderston, Vice Chairman
Mills
Robertson
Shepardson
King
Mitchell
Mr. Sherman, Secretary
Mr. Kenyon, Assistant Secretary
Mr. Young, Adviser to the Board and Director,
Division of International Finance
Mr. Molony, Assistant to the Board
Mr. Fauver, Assistant to the Board
Mr. Chardon, Legislative Counsel
Mr. Noyes, Director, Division of Research
and Statistics
Adviser, Division of Research
Holland,
Mr.
and Statistics
Mr. Koch, Adviser, Division of Research and
Statistics
Mr. Spencer, General Assistant, Office of
the Secretary
Mr. Eckert, Chief, Banking Section, Division
of Research and Statistics
Mr. Yager, Chief, Government Finance Section,
Division of Research and Statistics
Money market review.
Mr. Yager commented on recent develop-
Illents in the money market, after which Mr. Eckert presented a report
on bank credit, the money supply, and related matters.
Following these reports, Messrs. Holland, Koch, Eckert, and
l'ager withdrew from the meeting and the following entered the room:
Mr. Hackley, General Counsel
Mr. Solomon, Director, Division of
Examinations
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2/9/62
Mr. Furth, Adviser, Division of International
Finance
Mr. Sammons, Adviser, Division of International
Finance
Mr. Goodman, Assistant Director, Division of
Examinations
Mr. Leavitt, Assistant Director, Division of
Examinations
Mr. Sprecher, Assistant Director, Division of
Personnel Administration
Discount rates.
The establishment without change by the Federal
Reserve Banks of New York, Cleveland, Richmond, St. Louis, Minneapolis,
Kansas City, and Dallas on February
8, 1962, of the rates on discounts
and advances in their existing schedules was approved unanimously, with
the understanding that appropriate advice would be sent to those Banks.
Circulated or distributed items. The following items, which
had been circulated or distributed to the members of the Board and
Copies of which are attached to these minutes under the respective
item numbers indicated, were approved unanimously:
Item No.
Letters to Manufacturers Hanover Trust Company,
New York, New York, transmitting preliminary
Permits to organize (1) Manufacturers Hanover
International Banking Corporation and (2)
Manufacturers Hanover International Finance
Co
rporation.
1-2
Letter to United California Bank, Los Angeles,
California, approving the establishment of a
seasonal branch on the grounds of the National
°Ils.nge Shaw, adjacent to the City of San Bernardino.
3
-3-
2/9/62
Item No.
4
Letter to Wyandotte Savings Bank, Wyandotte,
Michigan, approving the establishment of a
branch at 21005 Goddard Road, Taylor Township.
Prior to approval of Item No.
4, Mr. Leavitt reviewed infor-
mation contained in a memorandum dated January 30) 1962, from the
Division of Examinations concerning a protest filed by Security
Bank, Lincoln Park, Michigan, with regard to the proposed establishment of the branch by Wyandotte Savings Bank.
Mission to British Guiana (Item No. 5).
Pursuant to the
lecommendation contained in a memorandum dated February 8) 1962, from
'
Mr. Young, Adviser to the Board and Director, Division of International Finance, the Board authorized participation by Reed Irvine,
Chief, Latin America, Asia, and Africa Section, Division of International
Finance, in a survey mission to British Guiana for a period of eight
eeks beginning approximately February 150 1962, as requested by the
A€encY for International Development, on a reimbursable basis.
A
Copy of the letter sent to the Agency in that connection is attached
as Item No. 5.
Messrs. Sammons, Goodman, and Sprecher withdrew from the
meeting
at this point.
Report concerning consumer interests (Item No.
1184 been distributed under date of February
6). There
8, 1962, a draft of
letter Prepared
by the Division of Research and Statistics in reply
2/9/62
-4-
to a memorandum of February
6, 1962, from the Bureau of the Budget
and the Council of Economic Advisers, requesting the Board's views
and suggestions with respect to a possible Presidential message
concerning consumer interests.
Mr. Noyes reviewed the background of the request, following
which there was a general discussion resulting in agreement being
expressed with suggestions for certain editorial changes in the
clraft letter.
The letter was then approved unanimously in the form
attached as Item No.
6.
Messrs. Leavitt and Spencer then withdrew from the meeting.
System foreign currency operations.
During the discussion at
Yesterday's meeting concerning proposed System operations in foreign
eurTencies, reference had been made to the possibility of making such
°Perations subject to supervision by the Board of Governors rather
than by the Federal Open Market Committee. Pursuant to that discussion,
there had been distributed a memorandum from Mr. Hackley dated February
81 1962, in which Mr. Hackley reviewed the legal basis for such an
approach.
In his memorandum Mr. Hackley noted that the proposed operations
aPParently would be accomplished through the opening and maintenance
°I% accounts with foreign banks and the acquisition, holding, and
red4ction of credits with such banks payable in foreign currencies.
Such credits with foreign banks would be established, maintained,
Or reduced
through the establishment of reciprocal accounts, purchases
•
2/9/62
-5-
and sales of gold, or transfers of credit by means of cable transfers.
It might persuasively be argued, he suggested, that such operations
would not involve open market operations in the usual sense of the
term, since the prime objective would be the acquisition of foreign
currencies. Technically, only the purchase and sale of cable transfers
and of foreign bills of exchange (if any should be purchased) could be
regarded as "open market operations" authorized by section 14 of the
Federal Reserve Act. The opening of accounts with foreign banks, the
establishment of reciprocal balances, and purchases and sales of
gold would all appear to be transactions under section 14 that would
be subject to the jurisdiction of the Board of Governors rather than
the Open Market Committee. In any event, all such transactions,
including dealings in cable transfers or bills of exchange, might be
regarded as only incidental to the opening, maintenance, and reduction
of foreign accounts through which holdings of foreign currencies would
be made possible. From statements made by the House Banking and
Currency Committee relative to section 14 of the original Federal
Reserve Act, it might reasonably be assumed that it was contemplated
et
that time that any foreign exchange operations would be conducted
by the
Federal Reserve Banks not as open market transactions but
as transactions through accounts with foreign banks.
The memorandum noted that the alternative approach under
consideration would be more consistent with the requirement of the law
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2/9/62
that all foreign relationships of the Federal Reserve Banks shall be
sUbject to supervision and regulation by the Board of Governors.
When section 14(g) was first added to the Federal Reserve Act in
1933, section 12A was added at the same time in language that
authorized the Board to regulate not only open market operations but
also the relations of the Federal Reserve System with foreign central
or other foreign banks.
When section 12A was amended in 1935 to vest
authority over open market operations in the Open Market Committee,
the previous provision regarding foreign relations was eliminated.
From this legislative history, it might be argued that it was the
intent of Congress to preserve in the Board complete and overriding
authority with respect to all foreign relationships, including those
that might involve open market operations, despite the authority
vested in the Open Market Committee to regulate and direct open
Market operations generally. The suggested alternative approach
'would avoid any question as to whether the Board could properly
"delegate" to the Open Market Committee any portion of its responsibilities under section 14(g) with respect to the foreign relationships
of the Federal Reserve Banks.
While it might not be essential to make any amendment to
Regulation NI Relations with Foreign Banks and Bankers, it might
be desirable to amend the Regulation to set forth provisions relating
to the opening of accounts with foreign banks and state, in substance,
464
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2/9/62
that such accounts were to be opened with the approval of the Board
and that transactions therein would be subject to such instructions
and guidelines as the Board might prescribe.
The Board could then
issue instructions and guidelines under which the New York Reserve
Bank would open and maintain such foreign accounts.
Transactions by
the New York Reserve Bank in foreign currencies could be executed for
an account that might be called the "System Foreign Currency Account",
and the Board's instruction or guidelines might require that transactions
be carried on by an officer of the New York Bank satisfactory to the
Board, who might have the title "Manager of the System Foreign Currency
Account".
Under this approach the Federal Open Market Committee could
issue a directive to the New York Bank that would in effect authorize
it to execute for the account of the System Foreign Currency Account,
rather than the System Open Market Account, any open market transactions
that might be incident to the opening, maintenance, or reduction of
accounts with foreign banks payable in foreign currencies, in accordance
with such instructions as might be issued from time to time by the
Board.
In summary, it was Mr. Hackley's view, as stated in the
Memorandum, that an approach under which foreign currency operations
Vould be conducted under the supervision and regulation of the Board
vould be at least as defensible from a legal point of view as the
2/9/62
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conduct of such operations under the approach heretofore contemplated.
In addition, the alternative approach would probably have certain
Practical and operating advantages.
In commenting on the matter at the request of the Board,
Mr. Hack1ey said that the distributed memorandum had been rather
hastily prepared, its purpose being to afford some basis for review
and discussion by the Board.
The alternative approach would not
remove the basic legal question regarding the Federal Reserve System's
authority to engage in foreign currency operations.
Assuming, however,
that the Federal Reserve was authorized to open accounts with foreign
banks for the purposes here contemplated, rather than the purchase
ahd sale of bills abroad as such, the alternative approach would
appear to be at least as legally defensible as a program under which
foreign currency operations would be regarded as open market operations
subject to the jurisdiction of the Open Market Committee.
As indicated
in the memorandum, the alternative approach would seem to be in accord
with the intent of the original Federal Reserve Act; the House Banking
alld Currency Committee apparently regarded the provisions of section
14 regarding the opening of accounts abroad as a means by which Federal
Reserve Banks could enter into transactions in foreign exchange.
Plarther, the alternative approach would eliminate any question as
to the propriety of a "delegation" by the Board of its responsibilities
Iltder section 14(g) regarding the supervision over foreign relations
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2/9/62
of any kind by the Federal Reserve Banks.
There was some legislative
history that might be taken as evidence of intent of Congress that
the Open Market Committee would have control over open market
Operations but the Board would have overriding authority over foreign
relationships, even though the latter might incidentally involve what
might be regarded as open market operations.
In concluding his comments, Mr. Hackley noted that there
might be complications in the alternative approach that he had not
Yet had time to explore fully.
The ensuing discussion at this meeting touched upon some of
those possible complications.
One of them had to do with the role
Of the directors of the Federal Reserve Bank of New York under the
alternative approach, it being noted that the directors of the Bank
had been active in passing upon matters such as gold collateral loans
to foreign central banks and the opening of accounts by foreign
central banks with the Federal Reserve Bank of New York.
A related
question had to do with participation by other Reserve Banks in
transactions in foreign currencies conducted by the New York Reserve
Bank under the alternative proposal.
In this connection, Mr. Hackley
Pointed out that there was no specific provision of the Federal Reserve
Act under which the Board could compel participation by other Federal
Reserve Banks.
Section 14(e) of the Act required only that the Board's
consent be obtained by any Federal Reserve Bank before it opened an
account with a foreign bank and that other Reserve Banks might participate
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2/9/62
under regulations of the Board.
Thus, the only basis for compelling
other Federal Reserve Banks to participate would appear to be the
Board's general power of supervision over the Federal Reserve Banks.
The tentative view expressed by some of the members of the Board
was that this would not appear to be an objection of particular
consequence; that in fact there might be certain advantages to a
Procedure under which the New York Reserve Bank would conduct operations
in foreign currencies for its own account under the direction of
the Board.
From further discussion, it developed to be the feeling
Of some of the members of the Board) including Governors Mills,
Robertson, King, and Mitchell) that if, as appeared from Mr. Hackley's
memorandum, the alternative procedure would be as soundly based
from a legal standpoint -- or perhaps more so -- there were certain
Practical advantages of an operational nature that would suggest
following such an approach.
At the same time, it was regarded as
Unfortunate that this alternative possibility had not been developed
for consideration previously.
Until now, the whole discussion over
4 period of several months had been based on an assumption that
SYstem foreign currency operations, if conducted, would be conducted
Under the supervision of the Open Market Committee insofar as open
Market operations were concerned.
At its meeting on January 23, 1962,
the open Market Committee had approved in principle a program of System
foreign currency operations on the assumption that such operations
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2/9/62
would be conducted within the procedural pattern contemplated
up to this time.
Aside from the foregoing consideration, some concern was
expressed about the effect from the System standpoint of following
the alternative approach.
Governor Balderston expressed the hope
that the System would not become divided over this matter.
While
he liked the alternative suggestion from the standpoint of what
would appear to be the better manageability of day-to-day operations,
he felt it should be made clear, at least, that participations
would be offered by New York to the other Federal Reserve Banks.
Pursuing this line of thought, he commented that the Board had no
funds of its own; only the Reserve Banks had funds.
Therefore,
the implementation of any policy that the Board wished to follow
required the use of funds of at least one Reserve Bank, and if the
Board wanted to hold the System together as a unit, that would
indicate participation by all of the Reserve Banks.
Against the
Possibility of differences of view at some date in the future
between the Board and the Treasury, or between the Board and the
New York Bank, it behooved those concerned to be as sure as possible
that the procedural arrangements for conducting foreign currency
oPerations were fundamentally sound.
Chairman Martin expressed agreement.
He went on to say
that everyone would have to continue to work on this problem in order
-12-
2/9/62
to try to devise the best possible modus operandi for foreign
currency operations within a difficult framework that involved
the Board, the Treasury, and the Federal Reserve Banks. It was
his suggestion that Mr. Hackley's memorandum be made available
to the Presidents of the Federal Reserve Banks with a view to
full discussion at the meeting of the Open Market Committee next
Tuesday, February 13. Pending such discussion, he thought it
desirable not to take an inflexible position.
There was agreement with the procedural suggestion of
Chairman Martin. In addition, the staff was requested to recast
the several action documents that had been drafted on the basis
Of the original approach so that they would be available for review
aM consideration.
The discussion then turned to the draft of proposed action
(authorization) regarding open market transactions in foreign
currencies dated February 6, 19620 and the review of the provisions
thereof that had been in process at the adjournment of yesterday's
Board meeting was resumed.
With reference to the section on administrative procedures,
''herein the Open Market Committee would authorize the Chairman
aad the Vice Chairman of the Committee and the Vice Chairman of the
Board of Governors, or their alternates, to take certain actions
'within guidelines issued by the Committee, Governor Balderston expressed
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2/9/62
the view that if the result of further discussion should be to
Proceed along the lines originally contemplated (whereby open
market operations in foreign currencies would be conducted under
the direction of the Open Market Committee), he felt that the
establishment of a smaller group, as provided in the draft authorization, would be desirable in case the Special Manager of the Open
Market Account for foreign currency operations found it necessary
to take emergency action.
In such circumstances, the Special
Manager could get in touch with this smaller group and obtain permission
to proceed.
Except in emergency circumstances, his thinking would
be to follow a procedure similar to that followed in respect to
Open market operations in Government securities.
For example, there
'would be a telephone conference call each morning, and any member of
the Board would be free to sit in on that call.
Likewise, any of
the members of the Open Market Committee should feel free to call the
Special Manager, in the same manner that they were free to call the
Account Manager, even though in practice such calls might be rare.
The special Manager would attend Open Market Committee meetings and
vould report fully on actions taken during the period since the preceding
Meeting.
At that time the Open Market Committee could give him such
guidance as it desired.
After further discussion of this section of the draft authorization, the suggestion was made that there be eliminated the statements
2/9/62
In the draft as to various specified actions that the smaller group
would be authorized to take, and that there be substituted an
authorization for such group to give instructions to the Special
Manager, within the guidelines issued by the Open Market Committee,
in cases when it was necessary to reach a decision on operations
before the Committee could be consulted. There was general agreement
that such a revision would be appropriate.
Certain additional minor amendments to the draft action
(authorization) were also agreed upon, and it was understood that
the draft would be revised for distribution in a form reflecting these
and other suggestions that had been agreed upon at the meetings of
the Board yesterday and today.
It was understood that there would be additional discussion
c/f the proposed program of System foreign currency operations at a
feeting of the Board to be held next Monday afternoon, February 12.
The meeting then adjourned.
Secretary's Note: Governor Shepardson today
approved on behalf of the Board the following items:
Letter to the Federal Reserve Bank of New York (attached Item
No.
approving the appointment of Victor Chang and Edward J. Ozog
as a
ssistant examiners.
Memoranda from appropriate individuals concerned recommending
alowing actions relating to the Board's staff:
thef
2/9/62
-15-
Continuance of employment on half-time basis
Employment of Daviette
(Data Processing), Division of
°n a half-time basis, with the
would be reviewed again at the
H. Stansbury, Research Assistant
Research and Statistics, continued
understanding that this arrangement
end of calendar year 1962.
'±'22pPtance of resignation
L. Marie Phipps, Statistical Typist, Division of Bank
Operations, effective at the close of business February 160 1962.
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 1
2/9/62
WASHINGTON 25, 0. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
February 9, 1962
Mr. Andrew L. Gomory, Executive Vice President,
Manufacturers Hanover Trust Company,
55 Broad Street,
New York 15, New York.
Dear Mr. Gomory:
The Board of Governors has approved the Articles of
Association and Organization Certificate, dated January 16,
1962, of Manufacturers Hanover International Banking Corporation, and there is enclosed a preliminary permit authorizing
that Corporation to exercise such of the powers conferred by
Section 25(a) of the Federal Reserve Act as are incidental and '
Preliminary to its organization. The Corporation may not
exercise any of the other powers conferred by Section 25(a)
until it has received a final permit from the Board of Governors
authorizing it generally to commence business. The steps which
Must be taken prior to issuance of a final permit are enumerated
in Section 211.3(c) of the Board's Regulation K.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
tnclosure
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
WASHINGTON
February 9, 1962
Preliminary Permit
IT IS HEREBY CERTIFIED that the Board of Governor.)
cf the Federal Reserve System, pursuant to authority vested
in it by Section 25(a) cif the Federal Reserve Act, as amended,
has this day approved the Articles of Association and Organization Certificate, dated January 16, 1962, of MANUFACTURERS
RANOVER INTERNATIONAL BANKIDG CORPORATION duly filed with said
Board of Governors, and that MANUFACTURERS HANOUR INTERNATIONAL
I3ANKI1G CORPORATION is authorized to exercise such of the powers
conferred upon it by said Section 25(a) as are incidental and
to its orgaiazation pending the issuance by the Board
Of Governors of the Federal Reserve System of a final permit
elle ally to commence business in accordance with the provisions
c'f said Section 25(a) and the rules and regulations of the Board
Of Governors of the Federal Reserve System issued pursuant thereto.
BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM
By
(Signed) Elizabeth L. Carmichael
Assistant Secretary
4.('S
• .1,6,
BOARD OF GOVERNORS
OF THE
Item No. 2
2/9/62
FEDERAL RESERVE SYSTEM
WASHINGTON 25, D. C.
ADDRESS OFFICIAL CORRESPONDENCE
TO THE BOARD
February
9, 1962
1,1,r. Andrew L. Gomory, Executive Vice President,
4anu1'acturers Hanover Trust Company,
55 Broad Street,
New York 15) New York.
Dear Mr, Gomory:
The Board of Governors has approved the Articles of
A
,sso
ciation
' and Organization Certificate, dated January 16,
t962, of
Manufacturers Hanover International Finance Corpora, and there is enclosed a preliminary permit authorizing
at Co
rporation to exercise such of the powers conferred by
ection 25(a) of the Federal Reserve Act as are incidental and
Pre • .
limlnary to its organization. The Corporation may not
exercise any of the other powers conferred by Section 25(a)
it has received a final permit from the Board of Governors
:
1,11til
1
thorizi it generally to commence business. The steps which
inst be taken prior to issuance of a final permit are enumerated
Section 211.3(c) of the Board's Regulation K.
v
zng
Very truly yours,
(Signed) Elizabeth L. Carmichael
ELizabeth L. Carmichael,
Assistant Secretary.
°sure
BOARD OF GOVERNORS
OF THE.
FEDERAL RESERVE SYSTEM
WAS
February
9, 1962
Preliminary Permit
IT IS IEREBY CERTIFIED that the Board of Governors
Of the Federal Reserve System, pursuant to authority vested
in it by Section 25(a) of the Federal Reserve Act, as amended,
has this day approved the Articles of Association and Organization Certificate, dated January 16, 1962, of MANUFACTURERS
HANavER INTERNATIONAL FINANCE CORPORATION duly filed with said
ard of Governors, and that MANUFACTURERS HANOVER INTERNATIONAL
FINANCE CORPORATION is authorized to exercise such of the powers
onterred upon it by said Section 25(a) as are incidental and
Preliminary to
its organization pending the issuance by the Board
Of
Governors of the Federal Reserve System of a final permit
generally to, commence business in accordance with the provisions
4:)t Said Section 25(a) and the rules and regulations of the Board
Of Governors of the Federal Rsove System issued pursuant thereto.
BOARD OF GOVERNORS OF THE
FEDERAL RESERVE SYSTEM
By
(Signed) Elizabeth L. Carmichael
Assistant Secretary
BOARD OF GOVERNORS
400.'atttr 4.4
OF THE
44 OW CapP,10
FEDERAL RESERVE SYSTEM
WASHINGTON 25. D. C.
4444
,
Item No. 3
2/9/62
ADDRESS OFFICIAL CORRESPONDENCE
4A)
TO THE BOARD
raTot
ti tL***
February 9, 1962
Board of Directors,
United California Bank,
Los Angeles, California.
Gentlemen:
The Board of Governors of the Federal Reserve System approves
the establishment of a branch on the grounds of the National Orange
in the vicinity of the intersection of South E Street and Mill
..treet, adjacent to the city of San Bernardino, San Bernardino County,
California, to be operated during the period March 14 through March 27,
1962
It is understood that the bank wishes to operate an office
this location each succeeding year in which the National Orange
61101.7 is open to the public. Consequently, the Board of Governors
1P?PProves the establishment and operation of a new branch at this
-1ocation for the period of one day antedating the opening of the Show
and extending
two days beyond the formal closing date of the Show each
ceeding year that the National Orange Show is open to the public.
t 's approval for each succeeding year is subject to cancellation by
Board of Governors upon reasonable notice to the bank prior to
wle beginning of such period of any year.
Very truly yours)
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
4'08
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 4
2/9/62
WASHINGTON 25. O. C.
NEIP arnMAL. OditagOIRO,4911
TO THIt INOR*0
February 9, 1962
Board of Directors,
IqYandotte Savings Bank,
Wyandotte, Michigan.
Gentlemen:
Pursuant to your request submitted through
the Federal Reserve Bank of Chicago, the Board of
Governors of the Federal Reserve System approves the
establishment of a branch at 21005 Godrinrd Road,
Taylor Township, Wayne County, Michigan, by Wyandotte
Savings Bank, provided the branch is established within
one year from the date of this letter.
Very truly you
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary..
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 5
2/9/62
WASHINGTON 25. D. C.
NCE
ADDRESS OFFICIAL CORRESPONDE
TO THE BOARD
)4,4'
0
444444-
'February 9, 1962.
Mx. Teodoro Moscoso,
Assistant Administrator,
Bureau for Latin America,
Agency for International Development,
Department of State,
Washington 25, D. C.
Dear Mr. Moscoso:
This is in reply to your letter of February 6, 1962,
to Mr. Sammons requesting that the Board of Governors make
available the services of Mr. Reed Irvine for a period of
aPProximately eight weeks beginning on or about February 15,
oft a reimbursable detail basis, in connection with a survey
Mission in British Guiana.
The Board of Governors has approved this proposal.
It i
understood that the detailed arrangements will be worked
""bY the personnel offices of our two agencies.
Sincerely yours,
(Signed) Merritt Sherman
Merritt Sherman,
Secretary.
BOARD OF GOVERNORS
Item No. 6
OF THE
FEDERAL RESERVE SYSTEM ,
2/9/62
WAS
OFFICE OF THE CHAIRMAN
February 9, 1962
Mr. Robert C. Turner, ABsistant Director,
Bureau of the Budget, and
Mr. Kermit Gordon, Member,
Council of Economic Advisers,
Executive Office of the President,
Washington 25, D. C.
tear Mr. Turner and Mr. Gordon:
This is in response to your memorandum of February 6,
1962, requesting the Board's views with respect to a possible
Presidential message concerning consumer interests.
We have reviewed with interest your outline of such a
Tessage. We are wholeheartedly in favor of increased efforts to
tc)cus goverhmental attention on the consumer. On most of the items
rted in your outline, however, we are not closely enough informed
14) be in a position to offer comments useful to you.
In connection with your outline item relating to proposed
legislation to require adequate disclosure of "true interest rate,"
°11 consumer loans, the Board has taken the position that it is in
.
'it cord with the objective of requiring adequate disclosure of
itnance charges. Nhile the Board is in sympathy with this objective,
regs this problem as one of regulation of trade practices of
lenders and vendors and thus foreign to the Federal Reserve's
P imarY responsibility. For this reason, the Board believes that,
:
as Your
outline notes, the Federal Trade Commission would be an
PPropriate agency to administer such a law.
Sincerely yours,
dt4
lepZe,(7,
NM. McC. Martin, Jr.
BOARD OF GOVERNORS
OF THE
FEDERAL RESERVE SYSTEM
Item No. 7
2/9/62
WASHINGTON 25, ID. C.
ADDRESS OFFICIAL CORRESPONDENCE
ttal
0444**
TO THE SOAR°
February 9, 1962
Mr. Howard D. Crosse, Vice President,
Federal Reserve Bank of New York,
New York 45, New York.
Dear Mr. Crosse:
In accordance with the request contained
in your letter of February 5, 1962, the Board approves
the appointment of Victor Chang and Edward J. Ozog as
assistant examiners for the Federal Reserve Bank of
New York. Please advise the effective dates of the
appointments.
Very truly yours,
(Signed) Elizabeth L. Carmichael
Elizabeth L. Carmichael,
Assistant Secretary.
@FedFRASER