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1723 A meeting of the Board of Governors of the Federal Reserve 8Ystem was held in Washington on Tuesday, November 21, 1944, at 10:30 a.m. PRE6ENT: Mr. Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman Szymczak McKee Draper Mr. Morrill, Secretary Mr. Carpenter, Assistant Secretary Mr. Hammond, Assistant Secretary Mr. Clayton, Assistant to the Chairman Mr. Goldenweiser, Director of the Division of Research and Statistics Mr. Smead, Director of the Division of Bank Operations Mr. Leonard, Director of the Division of Personnel Administration Mr. Vest, Assistant General Attorney Mr. Wyatt, General Counsel Mr. Gardner, Chief, International Section, Division of Research and Statistics Reference was made to the consideration given at the Board's keet41.1 gs °11. April 14 and 21 and May 17, 1944, to action looking toward the renewal bond December 31, 1944, of the authority contained in the -ec°11c1 War Powers Act under which the Federal Reserve Banks might pur— obligatio_ s n of the United States directly from the United States l'e4811rY, and Mr. McKee inquired as to the present status of the matter. Ur. Vest said that on Saturday, November 18, Assistant Solicitor Qeherea. Cox of the Department of Justice called on the telephone to say that there would be a hearing before the House Judiciary Committee on 14°Iretber 20 on the question of the extension of the Second War Powers 4 t at which the Department of Justice would make a statement and any 1724 11/21/44 olt,her 0 agency that desired could also be heard. Mr. Vest also said that after conferring with Mr. Szymczak it was agreed that he (Mr. Vest) w°11-1c1 advise Mr. Cox that it did not appear necessary for a representa— ti: "of the Board to testify at this time but that a representative w°111c1 attend the hearings so that if anything arose during the hear— ing8 in which the Board was interested it could, if thought desirable, hate a re presentative testify. Mr. Vest added that Mr. Cherry of the Legal on DSi attended the hearings yesterday when the Second War Powers Act was reviewed section by section and that no objection was N.sled with respect to the renewal of the section of the Act which pro— v:14e8 for direct purchases of Government securities by the Federal Re— serve Banks. Later in the meeting Mr. Vest received a report that the jIldiciarY Committee of the House had not yet passed on the bill but that it would meet tomorrow to consider the matter further. yMcKee suggested that consideration should be given to the of some action being taken by the Board in support of the 411ellal of the authority to make direct purchases, and there was a dis— N18414 of what might be done and whether the authority in its present fora, would be adequate. At the conclusion of the discussion, it was agreed that Chairman Eccles should talk informally with Mr. Bell, Under Secre— tary of the Treasury, for the purpose of ascertaining whether the Treasury was satis— fied to have the authority extended in its present form or whether it felt that it should be expanded to meet any situation I ';i2F-, 11/21/44 -3that might arise in the future in the event of widespread sales or redemptions of Government securities. Before this meeting there was circulated among the members of the B oard a memorandum dated November 11, 1944, from Mr. Gardner in which it - was stated that Treasury attorneys were working on a draft the necessa-iy legislation to implement the Bretton Woods agreements Lithe . united States, that the State Department was also considering the 'flatter With the main emphasis upon informing Congress of the scope or the entire international economic program of which the Bretton Woods agreern ents would be a part, and that there were certain problems in connection . wlth the enabling legislation which were of immediate concern to the p ederal Reserve System including the management of the Internatioriaa. 4' t°netary Fund and the Bank for Reconstruction and Development, the 43411/er in which the contribution of the United States to the Intertlati onal 14°netary Fund would be made, steps to be taken to prevent adverse effect from the accumulation of dollar balances by foreign govand central banks in this country, and the question whether the the:wers of the Federal Reserve System were sufficient to deal With or stwar credit situation as it might be affected by heavy imports A ' ent gold reserves from abroad and of gold from the Internatiolla,1 -11 Stab ilization Fund. 1111'' Szymczak stated that the matter was being presented for 'eration by the Board at this time for the reason that it was Imi(314 er.;"*.) 11/4/44 —4— felt that if the Board was to take a position on the questions referred to above 4 4. J-L, should do so before the enabling legislation was too far ad— and before it was presented to Congress for consideration. He als° said there was a question whether the Board should make a public statement in the Federal Reserve Milletin or otherwise with respect to its no ., elLion on the Bretton Woods agreements. The whole matter was considered in the light of previous discus— °f the Plans leading up to the Bretton Woods agreements and the 5 1313int to be covered in the enabling legislation. ei°118 Following a reading of Mr. Gardner's memorandum and the consideration of the Points to be covered in the enabling legis— lation with respect to the management of the Fund and the Bank, Mr. Ransom moved that Messrs. Eccles and Szymczak be ap— pointed a special committee of the Board to prepare a written recommendation as to the actions that should be taken by the Board with respect to all of the matters referred to during the discussion. This motion was put by the chair and carried, Mr. McKee not voting. At this point Messrs. Goldenweiser, Smead, Leonard, Vest, Wyatt, 4—qier withdrew from the meeting. The after action stated with respect to each of the matters herein— referred to was taken by the Board: The minutes of the meeting of the Board of Governors of the Fe, %teraa. Res erve System held on November 20, 1944, were approved unani— 14°1181Y. 11/21/44 —5— Memorandum dated November 21, 1944, from Mr. Paulger, Director of thelb: • i. vsion of Examinations, submitting the resignation of Charles Eaton as an Assistant Federal Reserve Examiner in that Division, to be— come effective as of the close of business on January 11, 1945, or on an 413ProPriate earlier date if annual leave is used prior to his leaving the service of the Board, and recommending that the resignation be ac— celd as of that date. The resignation was accepted as rec— ommended. Letter to aerve Mr. Koppang, First Vice President of the Federal Re— 'ank of Kansas City, reading as follows: In accordance with the request contained in your letter of November 16, 1944, the Board of Governors ap— proveso the continuation of the payment of salary to Mr. 4.7!e Pairbairn at the rate of 2,620 per annum, which 3!320 in excess of the maximum provided in the person— thA classification plan of the Oklahoma City Branch for „.:-.Position of General Clerk, Accounting Department, the vosition to which he is currently assigned." g Approved unanimously. Letter to the board of directors of "The Merchants and Farmers ate t k of Weatherford", Weatherford, Texas, stating that, subject to conditi cns of membership numbered 1 to 3 contained in the Board's Re tOfl 41, the Board approves the bank's application for membership the p -ecleral Reserve System and for the appropriate amount of stock &lithe Federal Reserve Bank of Dallas. k.ye-)C2 I. 4.0L, 11/21/44 -6— Approved unanimously, for transmission through the Federal Reserve Bank of Dallas. Letter to the "Levelland State Bank", Levelland, Texas, reading 48 follows: "The Board is glad to learn that you have completed all arrangements for the admission of your bank to the Federal Reserve System and takes pleasure in transmitting herewith a formal certificate of your membership. c . "It will be appreciated if you will acknowledge receipt of this certificate." Approved unanimously. Letter to Mr. Wellman, Deputy Chairman of the Federal Reserve tank of San Francisco, reading as follows: 10, "Receipt is acknowledged of your letter of November Ban,_1944, and enclosures relating to the demand of the th of America National Trust and Savings Association ' a the name of their nominee, Mr. H. C. McGinn, be included as a candidate on the ballot to be utilized in the ecton of a Class B director now being held. her "The Board sees no reason to alter the instructions to et°fore given Mr. Grady in the Board's communication him of October 27, 1944." Approved unanimously. Thereupon the meeting adjourned. Chairman.
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