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"a(IS Minutes of actions taken by the Board of Governors of the Federal Reserve System on Monday, January 29, 1951. PRESENT: Mr. Mr. Mr. Mr. Mr. McCabe, Chairman Szymczak Evans Vardaman Powell Mr. Carpenter, Secretary Mr. Sherman, Assistant Secretary Mr. Kenyon, Assistant Secretary Minutes of actions taken by the Board of Governors of the Isderal Reserve System on January 26, 19510 were approved unanimousl y. Letter to Honorable Frederick J. Lawton, Director, Bureau °I' the Budget, Washington 25, D. C., reading as follows: "Since the date of the Board's letter to you of January 10, 1971, submitting a proposed amendMont to the Assignment of Claims Act of 1940, this matter has been the subject of considerable discussion between members of your staff and of the Board's staff and other interested Government agencies, Particularly with respect to the language of the proPosed amendment. "In the course of these discussions, it has been learned that question has been raised in some cparters as to the extent of the need for this legIslation in order to remove an impediment to the current V-loan program for the financing of defense ontractom As a means of demonstrating this need, there is enclosed a memorandum, prepared on the 'asis of information received from the Federal Re"rye Banks, regarding the unwillingness of banks to . 311..!ticipate in the financing of defense contractors c̀trss the Assignment of Claims Act Is amended to arifY the rights of banks taking assignments under that Act," Approved unanimously. 44k Telegram to Mr. Sproul, President of the Federal Reserve York, reading as follows: 1/29/71 -2- "Mr. John Allison, Director of Finance, GIN-SCAP, and Mr. William i. Diehl, Financial Attache, United States Political Advisor, GHQSOAP, have been conferring with members of the Board's staff as to the possibility of the Government of Japan opening an account with your Bank. The account might be operated by the Government of Japan as agent for SCAP. These gentlemen wish tc explore the matter thoroughly from the viewpoint of both the Government of Japan and SCAP. They expect to be in New York soon to go into the matter with your Bank and since this may fall within the purview of Regulation NI your Bank is authorized to conduct such negotiations With these gentlemen as may seem to be appropriate in the circumstances. It will be appreciated, however, if you will keep the Board advised of such negotiations as provided in Regulation N." Approved unanimously. Letter prepared for the signature of Chairman McCabe to SProull President of the Federal Reserve Bank ofNew York, reading se follows: "The Board can readily realize the hope exPressed in your letter of January 17 that it would not be necessary to extend beyord the middle of February the leave of absence granted to Mr. Phelan so that he might serve as Acting Director of the !!oard's Division of Selective Credit Regulation. .uhs Board is very grateful for the assistance he is giving us. BAs experience in the field of Regulations V and W and in staff organization has been extremely helpful. "Much of his time has been taken during the two 11111°11ths he has been here in work on the multiple ueing amendments to Regulation X. Since a fur2" 1 amendment to apply the regulation to commercial ' onstruction is now under study, a considerable !Taunt of his time will be required in that connecn in the period immediately ahead. As you will realize, the organization of a staft for an operation of this kind does require time ezd because of the importance from the standpoint of j : 1/29/51 -3- "the whole System of having a smoothly working division we trust that you will not insist that Mr. Phelan return until that has been accomplished. We shall do everything we can to expedite his work. However, if, as it now appears, some additional time beyond the middle of February may be required, we trust that your 13Fmk will be willing to extend his leave of absence for that period." Approved unanimously. /,/ 44:CZ dp. /SecretarY
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