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5a9 AA a special meeting of the Federal Reserve 3oard held in the office of the Board on 7uesd4y, May 22, at 11 a.m., :r. ,rburg, presiding, . Hamlin, Mr. Delano, Mr. illis, ecretary. The minutes of the meeting of the Board held on May 21 were read and, on motion, approved. Mr. H. ,... ,'heeler of ChicJ.go was, by previous appointment, given a hearing before the Board, and on being admitted, stated that he had come for the purpose of considering with the Board the case of Lr. Hale Holden, now a director of the Union Trust company and the Merchants Loan & Trust Company of Chicaco. It was the desire of :;:r. aheeler that 1.1r. be permitted to continue as a director of both companies irrespective of the iuestion whether one of them might become a member of the Federal reserve system. Mr. Wheeler stated briefly to the Board that the facts in the case were already fully before it and that he considered the decision to be a matter resting largely upon broad general considerations of policy. 51:3 after finishing the discussion of Kr. Holden's case, 1.r. ,theeler inialred whether the decision which had previously been rendered by the Board with reference to a director of the Union Trust Company who was also a director of the 1,:ercantile Trust & avings Bunk of Chicago, would hold good in the case of directors similarly situarburg expressed the opinion that what held ted. good or one would likewise hold good for others, the question at issue being that of the relations of the institutions. Lir..theeler then expressed to the Board his opposition to the proposed tax on bank checks. Having concluded his argument, birheeler there- upon withdrew from the room. The question of a 90 day rate on member bank customers' notes secured by 7,iberty bonds, was then presented to the Board, and telegrams from the ?ederal deserve Bank of Dallas and 3n Francisco, and a letter from the Federal serve Bank of New York were read. Thereupon lir. itarbarg presented to the Board a draft of a general letter addressed to all Aderal reserve banks, and expressing the Board's policy on the whole question. The 5414 letter was discussed and minor modifications introduced into it. Mr. Hamlin then moved to send out the letter in substance as representing the sentiment of the Board on the Nhole Taertion of special rates of rediscount. Mr. Miller thereupon moved to amend Mr. Hamlin's motion by striking out from the proposed draft the last paragraph in which reference was made to the rediscounting of paper of non-member banks, member b nks acting as their agents. On being pat to a vote the amendment was lost. moved to amend Mr. Hamlin's motion by 7 Er. :111er changing the second paragraph on the second page of the proposed draft in such a way as to state that rates of discount to be established by 7ederal reserve banks for notes secured by bonds should be - s low as, but no lower than, the rates est:ibliched on paper of similar maturity otherwise protected. .,,fter discussion Mr. Miller withdrew his cmendment. 1,1r. Miller then moved to amend Er. Hamlin's motion by revising the third page of the draft in such a 5415 way as to eliminate all reference to a special or prefferential rate on paper coll , terAed by Government obli,gation. On being put to a vote the amendment was defeated. Er. Hamlin's orizinal motion then recurring, was declared carried, 1.7r. iller being recorded in the nega- tive. The question of the actual e:.,tablishmf-nt of rates at Federal reserve banks was then taken up, and it was, on motion, voted to establish a rate of 37.-4J on customer's paper secured by Treasury certificates or bonds, such paper having a maturity of not over 90 days. On motion, it was voted to telegraph to all Federal reserve banks that this general rate had been established for their use if desired, and that a letter outlining the Board's eneral policy would be transmitted today. The question of a special rate at the Federal deserve Bank of New York of 2, for periods of one day, such rate to be used at the discretion of the officers, was presented but not acted upon, the matter being referred to the 1,..zeoutive Committee. z. memorandum prep.lred by Delano and Lr. darburg with reference to the question of publishing the reports of ty-16 the Comptroller of the Juxrency giving the combined statements of the clearing houses of the country, was presented. ,fter discussion, the Comptroller stated that he thought it would be best to refrain from publishing any such statements under existing conditions,but that he would supply them to the Board for its information. 4. report of the Committee on ,taff recommending an increase in the salary of Examiner Charles R. Burrell from 43300 to .;0600 per annum, effective June 1, -as, on motion, approved. The ecretary of the Board read a letter from Aci- erL1 Reserve Agent Heath re4uesting that printing orders for notes be placed in sufficient amount to bring the supply held for the Chicago Bank up to :)150,000,000 or thereabouts, the denominations to be subst.ntially as at present. On mo- tion, it was voted that such an order be placed. The 'Secretary read a memom,ndum from hief Lxaminer Broderick ;ith reference to a change in the lording of the Board's Regulation 0 (paragraph 10) with reference to reserve deficiencies. The matter was referred to the Execu- tive Jommittee for report. Lr. Hamlin asked for,special report from the Board's ii 547 Chief.Examiner with reference to the.shortage recently diccovered in the Federal deserve. Bank of Cleveland. It was agreed that Mr. Hamlin, as chairman of the Committee on Operation of the Cleveland Bank, should make the reuest. „ On motion at 12.50 p.m. the Board adjourned to meet on Thursday, Yay 24, at eleven'a.m. APPa0VLD: Chairman. Secretary.
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