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740




At a regular meeting of the Federal Reserve
Board held in the office of the Board on Wednesday,
September 15, at 11.00 a. m.
PRE3ENT:
Mr. McAdoo, presiding,

Mr. Harding

Mr. Hamlin

Mr. Warburg

Mr. Williams

Ur. Willis, Secretary.

The question of rates of discount at Federal reserve banks coming up for consideration, it was on motion
voted that the following rates be approved:
For the Federal Reserve Bank of Richmond, 3% on
Commodity Paper for maturities up to 90 days; 3N on Trade
Acceptances up to '60 days, and 4;; from 60 to 90 days.
On motion the Board voted to approve the following
rates for the Federal Reserve Bank of Minneapolis:
Commercial Paper

60 to 90 days

4YA

On motion the Board voted to approve the following
rates for the Federal Reserve Bank of St. Louis:
Commercial Paper, maturities up to 90 days, 4%;
Trade Acceptances up to 90 days, 5.
The Secretary of the Board presented a communication
from the Federal Reserve Bank of San Francisco, naming rates am
follows:

741

COMIODITY

PAPER

30 to
60
over

30 days
60
90
90

The Secretary of the Board presented a telegram
from Mr. A. C. Miller, member of the Board, explaining the
action of the Board of directors of the Federal Reserve
Bank of San Francisco.
thus named ensued.

General discussion of the rates

It was finally agreed to suspend action

on the rates named by San Franoisc9, pending the arrival of
a statement of reasons for their action, prepared by the
board of directors of the San Francisco bank, to which
reference was made in the telegram announcing the action
taken.
It was the sense of the Board expressed without
. prejudice to the action of Mr. Miller in this particular
instance, that, in general, it was inadvisable that members
of the Board should meet with boards of directors of Federal
reserve banks on occasions when action taken by the Federal
Reserve Board or recommended by it, was under consideration,
without the express authority of the Board.
The Secretary of the Board having read letters from
the Federal Reserve Banks of Minneapolis, Cleveland, Boston,




742




Chicago and Kansas City relative to the question of
Commodity Rates, all either deferring action or disapproving it, it was agreed that all the Federal reserve
banks which have not taken action on the question of
rates for Commodity Paper, should be asked to send a
full statement expressing more completely the reasons
for their attitude.
A memorandum prepared by Mr. Warburg with
reference to the suspension of the issue of small gold
certificates having been discussed, Mr. McAdoo undertook
to secure consideration of the matter in conjunction with
Assistant Secretary Malburn, and report back to the Board.
On motion it was voted that a Comparative Digest,
prepared by Er. Hamlin for the use of the Board, contrasting the provisions of the Aldrich Bill and the Federal Reserve Act, should be mimeographed.
The Secretary of the Board having presented a file
of papers relating to the purchase of a bank building at
Dallas, Texas, the whole subject was referred to Mr. Warburg
and Er. Harding as a special committee, with request that
they report back to the Board at an early date.
The Secretary of the Board presented a letter from
the Secretary of the Advisory Council informing the Board

743

that the Executive Committee of the Council would meet
in New York on the 20th instant, and the Council itself
in Washington on the 21st.
The reports of Chief of Division Broderick on
the condition of Federal reserve banks, and on the accounts of Federal reserve agents, were referred to the
Committee on Audit and Examination, to pass first through
the hands of the members to whom these banks have been
specially assigned.
On motion an application of the Federal Reserve.
Bank of Philadelphia for an issue of Federal reserve notes
aggregating 4800,000, duly recommended by the Committee on
Issue and Redemption, was approved as follows:
•

420

denomination

4800,000

On motion the application of the Jefferson National
Bank of Charlottesville, Virginia, for power to exercise the
functions of trustee, executor, administrator and registrar,
duly recommended by Er. Harding and Mr. Williams, was approved.
The Secretary of the Board having presented a letter
from Hon. J. H. Lewis with reference to the reported proposal
to obain a loan on behalf of certain European belligerents
from American banking interests, it was voted that the Governor send a suitable reply to Mr. Lewis.




744




The Secretary of the Board having presented
letters from Federal Reserve Agent Jay and Governor Lc
Dougal of the Federal Reserve

Bank

of Chicago, relative

to proposed postponment of the meeting of the Clearing
Committee 6f Federal Reserve Agents, it was voted that
he transmit copies of these letters to Federal Reserve
Agent Curtiss with request for an expression of his
opinion regarding the proposal.
The Secretary of the Board read a letter from
Federal Reserve Agent Jay regarding the form in which the
credit reports concerning member banks are to be made by
Chief Examiners and Federal Reserve Banks.

The subject

was discussed and Mr. Jay's letter ordered placed on
file.
The application of the Federal Reserve Bank of
Cleveland for power to buy the whole of an issue of j350,000
of municipal warrants to be issued by the City of Toledo was
discussed and on motion it was voted that the Bank of Cleveland be authorized to purchase not to exceed one-half of the
issue.
A letter from Deputy Federal Reserve Agent ECCaleb
as to the attitude of the Federal Reserve Board respecting
the rediscount of paper for members, with State Bank endorse-

745

ment, was referred to Mr. Harding for consideration and
report.
The Secretary of the Board presented a letter
from Federal Reserve Agent Curtiss inquiring the policy
of the Board in calling for statements from State member
banks, and also an opinion of counsel to the effect that
such members must report to the Comptroller.

Ho was

directed to say to Er. Curtiss that the Board's view is
that where the State and National reports fall on the
same day, the State member banks may simply mail a duplicate copy of their regular report duly sworn to, to the
Comptroller, but where they fall on separate days, the
law will require that a'special report to the Comptroller
shall be made.
Correspondence relating to the establishment of
the New Orleans branch of the Federal Reserve Bank of
Atlanta, including the proposed pay-roll for same and the
minutes of the first meeting of the Board of Directors,
were referred to Mr. Harding for report.
On motion an additional printing of six million
dollars of Federal reserve notes for the Federal Reserve
Bank of Atlanta as follows:







45 denominations
10
20

e
4 '2,800,000
1,600,000
1,600,000

was authorized by the Board, subject to the approval Of
the Committee on Issue and Redemption.
The Secretary of the Board read a resolution
relating to the establishment of accounts for Federal Reserve Agents under the Gold Settlement Fund, and on motion
the same was referred to Counsel.
The Secretary of the Board presented a new form
of requisition for notes for delivery to branch Federal Reserve Banks and on motion the same was referred to counsel
and Comptroller of the Currency for their approval.
The Governor of the Board suggested the advisability
of including in the weekly report of operations, detailed
figures regarding the amount of United States notes, silver
and other forms of money held by Reserve Banks.

The Secretary

of the Board was directed to investigate the matter in conjunction with Chief of Division Broderick and report back.
Upon recommendation from Chief of Division Broderick
regarding the funds held by the Treasurer of the United States
for the Banks of Cleveland and Chicago, the matter was referred
to Mr. Elliott.

747

On motion at 1,25 p. in. the Board adjourned
to meet Thursday, September 16th at 3.00 p. in.

Secretary.

APPROVED;




Chairman.


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102