The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
1962 Minutes of actions taken by the Board of Governors of the Federal Reserve System on Wednesday, November 19, 1952. The Board /net in the Board Room at 10:00 a.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Mr. Martin, Chairman Szymczak Evans Vardaman Mills Robertson Carpenter, Secretary Sherman, Assistant Secretary Kenyon, Assistant Secretary Thurston, Assistant to the Board Riefler, Assistant to the Chairman Vest, General Counsel Leonard, Director, Division of Bank Operations Young, Director, Division of Research and Statistics Mr. Allen, Director, Division of Personnel Administration Mr. Myrick, Assistant Director, Division of Bank Operations Mr. Noyes, Assistant Director, Division of Research and Statistics Mr. Farrell, Chief, Reserve Bank Budget and Expense Section, Division of Bank Operations Mr. Massey, Technical Assistant, Division of Bank Operations Mr. Mr. Mr. Mr. Mr. Mr. Mr. There was presented a memorandum dated November 11'1'. A11 6, 1952, from recommending that the Division of Personnel Administration be allthori zed to make arrangements with the American Cancer Society to show a rain t0 the all women employees of the Board during regular working hours, required for the showing of the film and an accompanying lecture 1) 11/19/52 by —2— a representative of the Society being about 45 minutes. The memo- randum also recommended that an invitation to attend a showing of the flambe extended to wives of members of the Board's staff. Approved unanimously. Further consideration was given to the budgets of the Federal Resev,__ In Banks for the year 1953. During the discussion, reference was 'flade by Federal members of the Board to an item of 14,000 in the budget of the Reserve Bank of Chicago covering expenses in connection with the ceremonies incident to the formal opening of the new Detroit Branch 1lUi1ding and to an item of 6,700 in the budget Bank of Cleveland for directors' expenses other a/1d traveling expenses. In connection with his 8.04 suggested that the Federal Reserve Banks be of the Federal Reserve than fees, subsistence, comment, Governor Robertinformed that the Board aPProved the budgets as operating guides, that this approval should not be construed to indicate approval of specific expenditures, that the Fed'141 Reserve Banks should curtail expenses to the fullest extent possible, 41/4 that the Board had instructed its examiners to call attention to any eci°enditlize that appeared to be unreasonable. With regard to the item relating to the opening of the Detroit Bralich building, Mr. Leonard reported a recent conversation with Mr. Harris, -ee President of the Chicago Reserve Bank, at which time Ir. Harris decribed the program being planned in that connection. M. Leonard said 1964 W19/52 _3_ that he thought the figure of $14,000 probably represented a preliminary estimate which wculd be adjusted as the plans became more definite. He suggested, however, that the Board might wish to raise a question with regard to this item in a letter to the Reserve Bank and suggest that an aPPropriate program might be arranged at a lower cost. Following discussion, it was agreed that the attention of the Reserve Bank should be drawn to the size of the item. With regard to the item in the budget of the Federal Reserve Bank c)f Cleveland relating to directors' expenses, Mr. Leonard said he assumed itIlras intended to cover such things as entertainment at joint meetings °f the head office and branch directors and expenses of outside speakers. He thought that the Board might wish to express to the Chairmen and PresiCt8 of the Reserve Banks at the time of their conferences its concern 413°11:t exPenditures of this type and urge that careful consideration be "4 to them. Governor Robertson then referred to an item of $2,1419 in the l''''dget of the Federal Reserve Bank of New York for meetings, conferences, Jersey State etc" including $7,000 for dinners for the New York and New barikerst as sociations, and stated that this raised in his mind the question Whether such expenditures were justifiable from the standpoint of the bellefits derived by the Reserve Bank and the System. 11/19/52 -4- There followed a general discussion of expenditures for the bank and public relations programs at the Reserve Banks and the objectives which should be established for such programs. During the discussion, Governor Mills inquired as to what guides were followed in allocating exPenees between the research and statistical function and the bank and Pilblio relations function, and Mr. Leonard replied that in general the e8e laren function was charged with expenses involved in the development of -Lormation while the bank and public relations function was charged vith e xPenses involved in making such information available, but that it Ivas very difficult to establish precise definitions which would be uni- . fo 11714 i nterpreted by the Reserve Banks. Governor Mills then suggested that advices to the Federal Reserve Banks regarding action by the Board on the 1953 budgets be deferred until lfter the f orthcoming Chairmen's Conference, with the thought that at the Co nference there could be a discussion with the Chairmen of the proced4lres followed in the handling of the budgets at the Reserve Banks and the B0 ard and of the principles which snould be kept in mind by the Reserve Bah et, dire- -°rs in approving the budgets of their respective Banks. It was also suggested that, in a discussion at the Chairmen's Con- teretice reference could be made, without referring to any Reserve Bank ePeelfic • allY, to such items as the proposed expenditures for dinners and 19fiG 1349/52 -5- entertainment at the New York Bank, that it could be brought out that it was difficult for the Board to judge the extent to which such expendi- tures were worth-while, and that it might be stated that the total 1953 budget for the times bank and public relations function was more than five a8 large as the that it expenditures for that function in 1941 and re8P°118ibilitY WAS the of of the Reserve Bank directors, in approving the budgets their Banks, to determine whether such expenditures were justified. At the conclusion of the discussion, there was agreement with Chairman Martin's suggestion that the budgets be approved, that letters to the Federal Reserve Banks along the lines suggested at this meeting be prepared, and that the matter be discussed at the Chairmen's Conference before the transmission of the letters. It was also unanimously agreed that in accordance with the understanding at the meeting on November 17, 1952, a program would be worked out which would provide for periodical review of the operations and expenses of the Federal Reserve Banks at meetings of the Board. concerning Chairman Martin then referred to the draft of report liederal Reserve been submitted Bank budgets and expenditures which had bY the the special committee headed by Mr. Coleman, Deputy Chairman of Pecleral Reserve referred to Bank of Chicago, and suggested that it be Governor Mills with the request that he review the report and make a l'ec°nullendation to the Board as to what action should be taken with resPect to it. Approved unanimously. 196'7 11/19/52 -6- Chairman Martin also referred to the suggestion that the budgets f the Board and the Reserve Banks might be submitted to the Congress, either by inclusion in the Board's Annual Report or in some other way. Re suggested that the matter be referred to Mr. Thurston with the request that he consider and submit a recommendation on whether the subof the budgets would be desirable and, if so, the method by which that might be done. Approved unanimously. At this point all of the members of the staff except Messrs. Car— Periter, Sherman, and Kenyon withdrew and the following additional actions were taken by the Board; Minutes of the meeting of the Board of Governors of the Federal Reserve System with the Federal Advisory Council held on November 18, 1952, were approved unanimously. Minutes of actions taken by the Board of Governors of the Federal --erve System on November 18, 1952, were approved unanimously. Letter to the Presidents of all Federal Reserve Banks, reading 48 follows: "At the Joint Meeting of the Presidents and the Board September 26 it was stated that 'The Presidents were not rladY to support the introduction at this time of legislat „?n to permit a Federal Reserve Bank to pay out notes of -"ler Federal Reserve Banks.' "The Board would like to have an expression of the tiviews of the Presidents as to the reasons why such legisla°n would not be desirable. The Board would also appreciate on 1968 1 19152 -7- any suggestions the Presidents may have to offer as to how any difficulties they foresee in such a program might be overcome. "It is hoped that the Presidents will be prepared to ciaouss this matter with the Board at the time of the Conference of Presidents to be held next month." Approved unanimously.
@FedFRASER