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A meeting of the Federal aeserve Board was held in the office of the Governor on Thursday, January 3, 1929 at 4:20 p.m. P,IESENT: Governor Young Mr. Platt Yr. Miller Mr. James Mr. Cunningham Mr. Pole Mr. Eddy, Secretary Mr. McClelland, Asst. Secretary The Governor presented telegram dated January 3rd from the Federal Aeserve Bank of New York, advising that beginning tomorrow, January 4th, their effective minimum buying rates will be as follows: Bankers' acceptances: 1 to 30 days 31 to 90 days 91 to 120 days 121 to 180 days Repurchase Trade acceptances _ _ - 4 1/2% 4 3/4% 4 7/8:4 5% 4 3/410 5; oneHe called attention to the fact that the above schedule increases 120 days quarter of one percent the existing rates for maturities from 31 to his opinand for purchases under resale agreement, and further stated that in ion the new rates should not be made effective until approved by the Board. open market He stated that he had understood the advisability of an increase in Market Investrates was to be discussed at the Board's meeting with the Open ment Committee on Monday. desirability of A general discussion ensued both with respect to the of the proposed increases and the procedure which has grown up In the matter whereby, after the establishment of buying rates at the Federal Reserve banks, effective rates are estabapproval by the Board of a minimum rate, currently 1/429 -2- lished by the bank without prior reference to the Board. It was the consensus review and Of opinion that such rates should be established, subject to the of discount and that determination of the Board, in the same manner as rates the present procedure should be revised. However, during the discussion it g buying rates was decided that the matter of revising the procedure for handlin te action should be reshould be given further .consideration and that immedia York directors. stricted to the schedule of rates proposed by the New At the conclusion of the discussion, upon motion, it was voted that the following telegram be addressed to the Chairman of the Board of Directors of the New York bank: "Your telegram of this date showing important changes in revised schedule of buying rates on acceptances raises of some questions of policy which it is the understanding the with nce the Board were to be considered at the confere January Monday, Open Market Investment Committee called for 7th. Board prefers to postpone its action until after this meeting unless there are considerations of special urgency requiring earlier action by the Board, in which case you changed will please advise the Board of your reasons for the efrates schedule in detail and not make new schedule of Board." fective until you have been further advised On this motion, Mr. Platt reciuested t voting "no". recorded as The meeting adjourned at 5:45 p.m. Secretary Approved:
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