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1_837 Minutes of actions taken by the Board of Governors of the Federal Reserve System on Monday, November 1, 1948. PRESENT: Mr. Mr. Mr. Mr. McCabe, Chairman Szymczak Draper Evans Mr. Mr. Mr. Mr. Carpenter, Secretary Sherman, Assistant Secretary Morrill, Special Adviser Thurston, Assistant to the Board Minutes of actions taken by the Board of Governors of the Federal Re serve System on October 28, 1948, were approved unanimously. Minu tes of actions taken by the Board of Governors of the erel Reaerve System on October 29, 1948, were approved and the actions recorded therein were ratified unanimously. Let+. -er to Mr, Peterson, Vice President of the Federal Reserve k4k °f st, Louie, reading as follows: Ns "Reference is made to your letter of October 26, bY Tmitting a certified copy of a resolution adopted e -card of Directors of The North Side Bank, EvansIndiana, signifying its intention to withdraw tr°111e' quesrtTenership in the Federal Reserve System and retequi n- Imiver of the six months notice that may be red. Boa z 111 : 4.. view of your favorable recommendation, the ziotic24 G overnors waives the requirement of six months' the F72 as r equested. Accordingly, upon surrender o lakqk '',4ieral Reserve Bank stock issued to The North Side '2tAC1s a or4rpiezlth ville, Indiana, the Federal Reserve Bank is to cancel such stock and make appropriate -41,thereon. to a;: c,t is noted that the bank has applied or intends ani )11,ieFe: p. for continuation of its deposit insurance „ 1-1e$ it will have four months from the date of of &tameMberetr eAe within which to accomplish termination o_ -FP (FRLS #3548). 1 1838 11/148 -2- 4,2 "Please advise the Board of Governors when cancella,'.1411 is effected and refund is made. The Certificate of membership issued should also be obtained, if possible, : 141c1 forwarded to the Board. The State banking authoriLrom should be advised of the bank's proposed withdrawal membership and when it has been effected." Approved unanimously. 13Etrik or Letter to Mr. Phelan, Vice President of the Federal Reserve New York, reading as follows: E. 14 "Reference is made to the letter to you from Mr. Aeg-* Ingram, President, National Electrical Wholesalers 1.- th us at New York City, a copy of which you left • the time of the Regulation W Conference early cab°"°ber) and which raises a question as to the appli th of the regulation to certain transactions for ( 4 r sale of various quantities, to er: of refrigerators, in apartment houses. is Mr. Ingram's letter states, in substance, that contract it Practice to use a conditional sales othe e financing • medium for such a transaction. Among itv r things, such a contract provides for deferred deovereries a ccording to the buyer's request, sometimes chats,: f'irlY extended period of time, and permits price clussZ2 !TY the seller for refrigerators yet to be re,end cancellation of the contract by either party. seller a ditio' nticipates the requirements of such a conSales contract by placing orders with his supthat deliveries the apartment house owners are • Eillbs1!°T Mr. Ingram's letter it appears further that treLet—otn-Lial number of such conditional sales contors 82 PUrSUant to which deliveries of some refrigergol,t, e Yet to be requested or made, were entered into Septsl ; faith in various parts of the country prior to 14hethZer20) 1948. Hence, the question arises as to eepeci'isuch contracts are subject to the regulation, Septeza b-tlY in the light of S-1043, concerning pre2O arrangements. aqi011-4--Le the circumstances of each particular trans hativt. °f the type in question necessarily are determ IIID131;2 the t ransactions, as generally described by Mr. 2 '4°111d appear to involve arrangements for future v.r2t4 .ALLJtRk, 11/144 "extensions of credit depending for final consummation 211 whether :Uch being refrigerators are requested and delivered. the case, the transactions are to be consid...red as divisible and treated accordingly under the ' egulation, deliveries prior to September 20 involving Tcterisions of credit before that date, and subsequent iveries involving extensions of credit after that en!and, therefore, subject to the regulation. Of where delivery following a given request by an si-Ilment house owner is the only detail of an extenXidit remaining to be completed after Septem" °f be1: ,20 the delayed delivery involves a situation BoaLa 811c ts that covered in the third paragraph of the e press th statement of September 29, 1948 (S-1043c) rea extension of credit resulting from that particular regra.ttifc: refrigerators would not be subject to the V "In letter the next to the last paragraph of Mr. Ingram's quem.2 he states that transactions of the kind here in illei were permitted by the Board under the old regto ‘; 4 ,°" r We feel that he may have in mind our letter Curtis R. Bowman, of December 3, 1946, which sinaciierned the applicability of the old regulation to erst"financing arrangements for the sale of refrig, apartment house owners where the total anticL et° thea,--'ed credit, as a rule, exceeded $2,000, the rllar limit of the regulation. 8isti2isre the question is not the status under a subcipet re gulation of a combined total amount of antiexte :i.crsdit, but rather the time at which certain of t111,4--ns of credit occur. The recent intervention lee ea;r411.„el'T regulation operates to cover only deliverSepte ; 'he resulting extensions of credit on or after tXr 20, as above indicated, unless after comple'7eriee— :11 anticipated or previously requested deli, ‘ 1.n all 2 ;1'!1,!. instalment credit arising therefrom, if °f $5,000 or less, becomes subject to the tee,, through a renewal or revision after that 144:k or Approved unanimously. Te le s gram to Mr. Slade, Vice President of the Federal Reserve 841 Francisco, reading as follows: 1840 11/148 -4stood"Reurtel October 19 re Regulation W. It is underYou refer to a loan for the purpose of paying a sPecial tax or assessment levied against real property ,T!Ifically to cover improvements such as paving, water , 1 7418, or the like, for that property. How such improrTents wou A be 'in connection with existing structures' not appliedentirely clear to us because if the improvement 2 12,lied uniformly to both highly improved properties vacant lots in the area as, for example, water : 11a would do, and the assessment were levied as is tatI llallY the case on some uniform basis, such as the front °f feet in the lot without regard to whethe, the.--t or not the lot contains structures, it would seem the 1 the improvement is essentially an improvement of 4-atrld rather than 'in connection with existing structt1es prov However, the loan would be exempt if the imconn:Lell :t in question was in fact exclusively 'in with sever or pipe existing structures', as, for example, e.e leading from a common water main or clouhtiNt:.? a particular structure, but it would seem eover" . 41- whether the cost of such a project would be althou edubY a tax or assessment in the ordinary sense, pr8e. c)" "we recognize that governmental or municipal to „lees t4' t v-Laceof hroughout the country do vary from place Approved unanimously. Meztorandum dated November 1, 1948, from Mt. Carpenter recomrliert4/1g, for the reasons stated in the memorandum, that increases 1 the aillounts stated below be made in the following classifica111°118 ta the 19,0 40 non-personal budget for the Secretary's Office: aiidIon Telephone -faegraph Stationery and Supplies Misce llaneous Increase $300 150 "300 " Approved unanim 120 Aor.fditAti Secretary.
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