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1477 A meeting of the Board of Governors of the Federal Reserve System was held in Washington on Saturday, September 23, 1944, at 10:30 a.m. PRESENT: Mr. Mr. Mr. Mr. Ransom, Vice Chairman McKee Draper Evans Mr. Morrill, Secretary Mr. Carpenter, Assistant Secretary The action stated with respect to each of the matters hereinafter referred to was taken by the Board: The minutes of the meeting of the Board of Governors of the Federal Reserve System held on September 22, 1944, were approved unanipiously. The minutes of the meeting of the Board of Governors of the Federal Reserve System with the Presidents of the Federal Reserve Banks held on September 22, 1944, were approved unanimously. Memorandum dated September 20, 1944, from Mr. Morrill recommending that Mrs. Marylou Arason, who has been absent on maternity leave, be reemployed as a stenographer in the Secretary's Office, with no change in her present basic salary at the rate of $1,800 per annum, effective October 1, 1944. Approved unanimously. -2- 9/23/44 Letter to the board of directors of the "Van Horn State Bank of Van Horn, Texas", Van Horn, Texas, stating that, subject to conditions of membership numbered 1 to 3 contained in the Board's Regulation II/ the Board approves the bank's application for membership in the Federal Reserve System and for the appropriate amount of stock in the Federal Reserve Bank of Dallas. Approved unanimously, for transmission through the Federal Reserve Bank of Dallas. Under date of September 14, 1944, the Board received a letter from Mr. Rouse, Vice President of the Federal Reserve Bank of New York, which transmitted an application of The National City Bank of New York, New York, New York, for permission to establish branches at Cairo and Alexandria, Egypt, and a recommendation of the Federal Reserve Bank that the application be approved. Accordingly, the following order was adopted by the Board: "ORDER OF THE BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM September 23, 1944 "WHEREAS The National City Bank of New York has the Fedmade application to the Board of Governors of of secns eral Reserve System, pursuant to the provisio on to permissi tion 25 of the Federal Reserve Act, for of Kingdom ia, Alexandr establish branches at Cairo and Egypt; and 1479 9/23/44 -3- "WHEREAS it appears that the said bank may properly be authorized to establish branches at Cairo and Alexandria, Kingdom of Egypt; "NOW, THEREFORE, IT IS ORDERED that The National City be and it hereby is authorized to estabBank of New lish branches at Cairo and Alexandria, Kingdom of Egypt, Upon the condition that unless the branches hereby authorized are actually established and opened for business on or before October 1, 1945, and the Board of Governors of the Federal Reserve System advised in writing that the ss, branches have been so established and opened for busine be s shall branche such to as all rights hereby granted deemed to have been abandoned and the authority hereby granted as to them shall automatically terminate; but, if the branches sh.11 have been established and opened for business on or before said date and the Board of Governors of the Federal Reserve System sha31 have been so advised in writing, the said bank may operate and maintain the same subject to the provisions of section 25 of the Federal Reserve Act." In connection with the above matter, the following letter to Mr. Rouse was approved unanimously: 14, "Reference is made to your letter of September City al Nation The of tion applica 1944, transmitting the Bank of New York, New York, for permission to establish Egypt. branches at Cairo and Alexandria, Kingdom of of the 25 section of ons provisi "Pursuant to the the Fedof ors Govern of Board Federal Reserve Act, the al City Bank Nation The zed authori eral Reserve System has dria, and Alexan Cairo at s branche of New York to establish es the branch that on conditi Kingdom of Egypt, upon the be actually established and opened for business on or before October 1, 1945 and the Board advised in writing that the branches have been so established and opened for business. the "There is enclosed herewith a certified copy of t ishmen the establ zing authori Board the order adopted by the bank. of the branches which you will please deliver to your files. for order the of copy a d enclose also There is 1.480 -4- 9/23/44 "It will be appreciated if you will advise the Board of the date the branches are actually established and Opened for business." A letter to the Comptroller of the Currency in the following form was also unanimously approved: "There is enclosed herewith for your information and files a copy of an order of the Board of Governors of the Federal Reserve System authorizing The National City Bank of New York to establish branches at Cairo and Alexandria, Kingdom of Egypt." Telegram to Mr. Brainard, Chairman of the Federal Reserve Bank of Cleveland, reading as follows: "Re tel September 20 regarding question whether al Bank Peoples-Pittsburgh Trust Company and First Nation pate may partici at Pittsburgh, Pittsburgh, Pennsylvania, B class direcin nomination and election of class A and tors your bank. In view of last paragraph of section by 2(c) of Banking Act of 1933 and the determination sPeople that Board in its letter of November 22, 1935 y affilcompan Pittsburgh Trust Company is not a holding 23A iate for any purposes other than those of section that Board of of the Federal Reserve Act, it is opinion A and class both member banks may vote in election of This decision class B directors of Federal Reserve Bank. been no mahas is based on the understanding that there since banks terial change in the situation between such November 22, 1935." Approved unanimously. Company, Birmingham, Letter to Mr. E. H. Sherry, Home Improvement Alabama, reading as follows: "This is with further reference to your recent letter V, of certain relative to the exemption from Regulation on to cases attenti call You fuel conservation credits. exemption this of ons provisi in which you believe the bring inconsistent results. 9/23/44 -1- wile know, as you do, that there are differences of opinion as to the merits of the various forms of insulation and the best ways of applying them. We know, too, that the properties of some materials are more structural than insulating in character. You will appreciate our the difficulty in developing a rule that would assist in much too ere interf fuel conservation program and yet not with our general objective of keeping credit from feeding the fires of inflation. We decided to draw the line at the wall of the house and we have found that all but a very few of the people interested in this matter agree that we have a rule that is easy to apply and that lets in most of the things that ought to be in and keeps out most that should not. ed by every"Naturally such a rule will not be regard which about cases one as perfect. There are borderline be well might It e. equally competent people will disagre id non-rig with tion questioned whether side-wall insula would be suffimaterial under the conditions you describe on from exempti an by ciently desirable to be encouraged nts in argume strong heard Regulation W, although we have has all it that deny behalf of this process by people who has been which point the handicaps you suggest. But the t is that subjec the of s influential in our several review and do not found ntly freque these borderline cases are not d extende credit of greatly affect either the total amount or the general competitive picture. "You have also suggested that insulation board is just as expensive whether put on the inside or outside, and with this we are in general agreement. But if insulation board is put on the outside, it can't be left as the exterior like asbestos surface. An additional layer of something and here is where shingles or asphalt siding must be applied the additional expense comes in. of an early "While we cannot give you any indication relate to they as ion revision in the terms of the regulat d from reviewe is matter this field, we assure you that the ions." condit g time to time in the light of changin Approved unanimously. Ransom to Honorable Letter prepared for the signature of Mr. 1482 9/23/44 -6- Howard W. Smith, Chairman, Special Committee to Investigate Executive Agencies, House of Representatives, reading as follows: "In reply to your letter of September 8, I am transmitting the following information regarding attorneys, economists and analysts employed by the Board of Governors of the Federal Reserve System. "As of September 15, 1944, the Board had on its staff Total Basic Annual Salaries Number $ 67,600 8 Attorneys 272,600 61 Economists ts who serve consultan three were there addition, "In paid are only for and basis y day-to-da a on intermittently the days actually worked. "The Board has no attorneys, economists or analysts regularly assigned to (1) drafting legislation to be submitted to Congress, and (2) analyzing bills, measures and Proposals pending before the committees of Congress. "The Board's Legal Division does try generally to follow the legislative calendar in order to be able to advise the Board with respect to any pending measure in Which the Board, because of its functions, would have an interest. The Legal Division also works on reports on Pending measures requested by various committees of Congress. The attorney whose other assignments best fit him for that task generally does such work as is required in connection With a particular measure. On various occasions, the Division drafts language designed to accompany proposals which the Board has under consideration or wishes to recommend to the available Congress. In such cases the work is done by the particular with familiar most member of the Division of other atives represent of advice subject and with the ilities lie responsib whose staff, divisions of the Board's tion. considera In the field under "Our General Attorney advises me that the amount of work involved in such drafting and analysis is so negligible in comparison to the whole work of the Legal Division that he would be at a loss to allocate it in terms of salaries. "A similar situation prevails with respect to the economists in the Board's Division of Research and Statisthe task tics, none of whom is specificR11 y assigned to 1483 9/23/44 -7- "of drafting legislation or analyzing bills and proposals pending before Congress. "The Division of Research and Statistics has several sections, each of which is expected to follow developments in its particular field. At times this involves analysis from the economic point of view of proposals before Congress. Such work, however, is but a minor part of the duties of the economists and is merely incidental to the broader phases of keeping abreast of economic development. I am advised that the work is so minor and incidental it is not prac— s to ticable to allocate any definite proportion of salarie it. "I trust this furnishes the information which you de— sire." Approved unanimously. Thereupon the meeting adjourned. ,42 7 Uo-Al InITAAL( _k'QeA3 ecretary. APProve • Vice Chairman.
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