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141 A meeting of the Board of Governors of the Federal Reserve ,7stem was held in Washington on Friday, January 28, 1944, at 11:00 PRESENT: Mr. Mr. Mr. Mr. Mr. Er. Eccles, Chairman Ransom, Vice Chairman Szymczak McKee Draper Evans Mr. Mr. Mr. Mr. Morrill, Secretary Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman The action stated with respect to each of the matters hereinafter referred to was taken by the Board: The minutes of the meeting of the Board of Governors of the l'ecleral Reserve System held on January 26, 1944, were approved unani111(311sly. Telegrams to Messrs. Treiber and Clouse, Secretaries of the Fede_ 1'8.1 Reserve Banks of New York and Cleveland, respectively, Mr. Leach , President of the Federal Reserve Bank of Richmond, Messrs. Dille , ru and Stewart, Secretaries of the Federal Reserve Banks of Chice.o. and St. Louis, respectively, Mr. Powell, First Vice President °I' the Federal Reserve Bank of Minneapolis, Mr. Caldwell, Chairman °f the Federal Reserve Bank of Kansas City, and Mr. Gilbert, President of the Federal Reserve Bank of Dallas, stating that the Board 11313r'°11es the establishment INithout change by the Federal Reserve Bank 142 1/28/44 -2- of St. Louis on January 26 and by the Federal Reserve Banks of New York, Cleveland, Richmond, Chicago, Minneapolis, Kansas City, and Dallas on January 27, 1944, of the rates of discount and purchase in their existing schedules. Approved unanimously. Bonds each in the amount of $10,000, executed on January 21, 1944, by Walter L. Eddy as Assistant Federal Reserve Agent and Jasper A. Lane and Clifford E. Morrissey as Alternate Assistant Federal Reserve Agents at the Federal Reserve Bank of Boston. Approved unanimously. Memorandum dated January 18, 1944, from Mr. Goldenweiser, Diliector of the Division of Research and Statistics, recommending that the basic salary of Miss Mary Jane Harrington, an economic assistant ill that Division, be increased from $2,000 to $2,200 per annum, effec- tive February 1, 1944. Approved unanimously. Letter to Mr. P. 0. Davis, Director of the Extension Service of the Alabama Polytechnic Institute, Auburn, Alabama, reading as follows: "Mr. Evans has brought your letter of January 18 to the attention of the Board. As he advised you last month, the appointment as director of the Birmingham Branch of the Federal Reserve Bank of Atlanta was tendered under the impression that you were a resident of the 143 —3— "territory served by the Branch and upon learning that such was not the case, but that it would be if the expansion of the Branch territory which Mr. Norton reported was under consideration took place, the appointment was considered as being held in abeyance pending developments. . "The regulations specifically provide that a branch director must reside within the territory served by the branch and since it now appears that the contemplated transfer of territory will not materialize, the appointment must regretfully be withdrawn. "The Board appreciates the attitude that you have Shown during the discussions regarding the appointment and your understanding of the fact that the only reason for the withdrawal is the requirement as to residence. "The members of the Board trust that if you have occasion to come to tashington, you will call at the Board's offices for a visit." Approved unanimously. Letter to the board of directors of the "Farmers State Bank of Middl eville, Michigan", Middleville, Mi chigan, stating that, subject to ecIlditions of membership numbered 1 to 3 contained in the Board's Regulati°11 H) the Board approves the bank's application for membership in the Federal Reserve System and for the appropriate amount of stock in the t, .cederal Reserve Bank of Chicago. Approved unanimously, for transmission through the Federal Reserve Bank of Chicago. Letter dated January 271 1944, to Mr. Woolley, Vice President 4" Cashier of the Federal Reserve Bank of Kansas City, reading as fol- lows: Luis refers to your letter of January 21, 1944 ;elating to reserve deficiencies of Westport Bank, ansas City, Missouri, during the semi-monthly periods 144 1/28/44 -4— "ended November 30, December 15, and December 31, 1943, all of which resulted from the same error on the part of the bank in making a double deduction for War Loan deposits. "This bank became a member of the Federal Reserve System on September 22, 1943, and, as mentioned in your letter, your Bank may under existing instructions waive the first penalty of $48.67 for the period ended November 30. In the circumstances, the Board will interpose no objection to your waiving the penalties on reserve deficiencies for the two subsequent periods also, which amount to $105.30." Approved unanimously. Letter to MT. Bond Geddes, Secretary of the Radio Manufacturers 48sociation, Washington, D. C., reading as follows: "With further reference to your letter of January 17 which was acknowledged by me on January 19, the members of the Board of Governors have noted with interest the resolution passed by the Board of Directors of your Association at its meeting in Chicago on January 13, as quoted in your letter. I am asked to advise you that the Board has already given consideration to the problem with which the resolution is concerned and Chairman Eccles has made certain recommendations, concurred in by the Board, ;,c) Mr. Bernard Baruch, Director of the Advisory Unit for . z'ar.and Post War Adjustment Policies, Office of War Mobil), Aatl°n. In this connection, in case you have not already 'Lone so it would seem appropriate that the resolution of Your Board of Directors be transmitted to Mr. Baruch." Approved, Mr. McKee voting "no". Letter to Mr. G. E. Steffensen, Manager of the Installment Loan 13e1341"tment, The Continental National Bank and Trust Company, Salt Lake eitY1 Utah, reading as follows: "Reference is made to your letter of January 19 re_ng to the Board's Regulation Viin its application to 4.0 tir . for the maintenance and repair of residential proper- 1.45 1/28/44 -5- "This regulation, as you know, is a part of the Government's wartime program to combat inflation. It restricts extensions of consumer credit because these add credit dollars to the already excessive spending power of the consuming public. It has limited repair and modernization loans of the usual type to a 12-month maturity ever since May 6, 1942, unless the work comes within the exception provided or 'defense housing' -- as defined by the National Housing Agency -- and the new NHA order to which your letter refers has the effect of withdrawing from the scope of this exemption a great many jobs which do not contribute Particularly to helping solve the war-housing problem. It would tend to defeat the purpose of the regulation to am .end it, as your letter appears to suggest, so as to permit 'the average individual' to take as long a time to repay the loan as was permissible in peacetime when the count-iv had no inflation problem to combat." f Approved unanimously. Letter to Mr. McCreedy, Assistant Vice President of the Federal Reserve Bank of Philadelphia, reading as follows: "This is to advise you that the Board on January 28, 1944, approved the bond which was executed on January 26, 1944, by Mr. Thomas B. McCabe and the American Surety :Company of New York, New York, New York, covering Mr. mcCabe as Federal Reserve Agent. "Our Legal Division is of the opinion that surety bonds are effective as of the date of their execution, and therefore it was not possible to comply with your request that the Board approve the new bonds so as to make them effective February 15, 1944. It is hoped that satisfactory premium arrangements can be arrived at between Your Bank and the bonding company. "In accordance with the advice contained in your letter of January 26, 1944, the Board today is notifying the !°11.ding company that it is under no obligation on the bond Which was executed by it on January 26, 1940, covering Mr. d in the capacity above described, for any acts cornette him subsequent to January 28, 1944, the date 1_113.0n which the new bond was approved by the Board. A e°pY of the letter addressed to the bonding company is enclosed for your records." Z 146 1/28/44 -6Approved unanimously, together with a similar letter to Mr. McCreedy advising of approval by the Board on January 28 of a bond executed on January 26, 1944, by J. Frank Rehfuss as Alternate Assistant Federal Reserve Agent at the Philadelphia Bank. Thereupon the meeting adjourned. avt):y Sec APPI'oved: Chairman. tary. .
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