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280 A- special meeting of the Federal Reserve Board was held in the office er the Federal Reserve Board on Saturday, March 31, 1928 at 11:00 a.m. PRESENT: Governor Young Er. Platt Mr. Hamlin Mr. Miller Yr. James Er. Eddy, Secretary Mr. McClelland, Asst. Secretary the request of the Governor the Secretary read to the Board the rcllowin --g letter dated March 30th from Deputy Governor Harrison of the Pederal -L ieserve Bank of New York: thi : TIlis letter will serve to confirm our telephone conversation of °morning concerning Rumania. boez,4 ' 8 You know, Dr. Hist and Mr. ,uesnay of the Bank of France have visiting us for the past two weeks. During the course of their . cotIr -!sations they have advised us: izatirhat the liumanian Government has decided to effect lefral stabilPres-°11 0f the leu, which has in fact been stabilized at about its unt value for about 16 months; of thThat the Rumanian Government, in collaboration with representatives !Bank Of France, as well as its private bankers, has prepared a Propr lott 9011 of stabilization which contemplates the issue of a government equivalent of 70,000,000 in New York and other internat1011a1711Xceet 411101 That the program which deals with the various monetary, fiscal tormeconomic aspects of Rumanian problems is now substantially in a 4014,!at isfactory to the Bank of France, though they think it may need ' cla ification in detail before final agreement; ,z114att_That the Bank of France has been requested by the National Bank of the V4 to commence the necessary steps to procure the cooperation of to faallks Of issue in behalf of the National Bank of R - umania in order the government's features of eilitate Drogram; monetary its the out carrying and ci:°-hat the Bank of France has accepted the responsibility of organizv138n1 Of issue arrangement in favor of the National Bank of Humania. to 134' have now received from the Bank of France a formal invitation total-"11:e1Pate in this arrangement which they believe should be for a ' e 020,0o0,000 or .„125,000,000. At the meeting of our directors Yeste„ ',the officers were authorized, subject to the approval of the P(iaer lieserve Board, to accept this invitation and to agree to purchase 110t '10,000,000 of prime commercial bills 1 exceed the equivalent of 0 ue41.1; -g at least two names and endorsed or guaranteed by the National 281 3/31/28 13411k theirof , wania. Our directors have taken this action not alone because of lexPressed desire to aid in the general return to a gold standard abroad ht '80 because of their belief in the importance of a continued cooperation ea the of issue. They think this will best be facilitated by our 1.;:;7tance of the invitation of the Bank of France to participate in the arment now being organized under their leadership. tiola While, as I explained to you over the telephone, it is the intentioi" the Bank of France to invite a number of other banks of issue to parin the proposed arrangement with the National Bank of Rumania, we do lot pate! 1, 0/ how many of these banks will accept, and our arrangement to particinot been conditioned upon the acceptance of any other particular -4 '13r banks, It is so difficult adequately to cover a question of this character !Ilthe 11aNret m' 001)e of a letter that if you or the Federal Reserve Board care to to g,0"48 do so before taking action in the matter, I shall of course be glad to Washington at any time that you will be good enough to advise me." bet4; The Governor stated that following receipt of the letter he called 41'147 GI3lier1201, Harrison over the telephone as to the duration of the proit and was informed that the directors of the New York bank would O evellt enter into an arrangement for a longer period than one year. He 1114 flIrther advised, he stated, that although the directors of the New York bkar -halre authorized the officers, subject to the approval of the Board, to 11*(41 t° Parchase not to exceed the equivalent of 40,000,000 of prime comkereial bilis bearing at least two names and endorsed or guaranteed by the 114ti°1141 Bank of .,tumania, it is not believed that the New York bank will be 4111e(1.11Pon in the final plan to agree to purchase in excess of .5,000,000 of : 41 4 bills, He also stated that he inquired of the Secretary of the Treasury -11t° the probable attitude of the State Department and was advised that in the Secretary's opinion the Department would favor cooperation in a plan t°1' Cr stabilization in Rumania. During the discussion of the above matter, Yr. McIntosh joined the et It was the consensus of opinion that the Rumanian stabilization 282 -3- 1414T4n1 is not as far advanced as were arrangements for currency stabilization 14 other European countries at the time the Federal Reserve banks agreed to Ilartioipate in the central bank credits involved in those programs. It was alse felt that the Board is not in possession of sufficient detailed information , °Is to the prospects for success of the Rumanian program and as to the ulonal significance of the program. Or At the request of the Board the 441or left the room and communicated over the telephone with the Secretary State regarding the latter aspect of the matter and upon his return ad- '18ect the Board that the Secretary of State would like to have the matter katitted to him. The Governor stated that he would, therefore, transmit to the Se cretary of State a copy of the letter received from the Deputy etWert °r of the Federal Reserve Bank of New York. After further discussion, upon motion, it was voted to request Deputy Governor Harrison to come to Washington early next week for the purpose of furnishing the Board with further information regarding the details of the l umanian program. We of the meeting of the Federal Reserve Board held on March 30th then read and approved. Telegrams dated March 30th from the Chairmen of the Federal Reserve Banks (It Chicago and St. Louis, advising of the establishment on that date of the tollow.rig 1 schedule of rates for purchases of bankers acceptances: 1 to 30 days 31 to 90 days 91 to 120 days 121 to 180 days 31/2% 3 5/8/; 3 3/4/0 4% 7iithout objection, noted with approval. Tel6r4m dated March 30th from the Chairman of the Federal Reserve Bank 283 3/31/28 .4- "'Richmond, advising of the establishment on that date of the following echeaUle of rates for parchases of bankers acceptances: 3 5/8% 3 3/470 37/8?; 1 to 30 days 31 to 90 days 91 to 120 days 121 to 180 days Without objection, noted with approval. Te1egr4m dated March 30th from the Chairman of the Federal Reserve Bank of 1114118apolis, advising of the establishment on that date of the following sehedule of purchase rates: Bankers acceptances: 1 to 30 days 31 to 90 days 91 to 120 days 121 to 180 days Repurchase Trade acceptances ONO Without objection, noted with approval. v. Letter dated March 29th from the Federal Reserve Agent at St. Louis, ad— t that the Liberty Insurance Bank, Louisville, Ky., has just advised of he °stab]. ishment on November 26, 1927 of a branch at 2609 Vest Broadway, 14"1"ille. Noted. 0 , STANDING ClOrMITTTES: 1)Ett „ 6-1 xareb. 30th, Recommending changes in stock at federal Reserve Banks as Book of this date. set forth in the Auxiliary Yinu Recommendations approved. The meeting adjourned at 12 Approved.: Secreta Goverriorc
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