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1304 A meeting of the Board of Governors of the Federal Reserve SYetem was held in Washington on Thursday, September 25, 1941, at 11:30 a.m. PRESENT: Mr. Mr. Mr. Mr. Mr. Eccles, Chairman Ransom, Vice Chairman Szymczak McKee Draper Mr. Mr. Mr. Mr. Morrill, Secretary Bethea, Assistant Secretary Carpenter, Assistant Secretary Clayton, Assistant to the Chairman 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 Fecleral Reserve System held on September 24, 1941, were approved unaniMously. Memorandum dated September 20, 1941, from Mr. Nelson, Assistant Secretary recommending (1) that the resignations submitted by lieo„ u r. Herbert and James F. Latham, elevator operators, be accepted Of the close of business on September 22 and 27, 1941, respectively; a (2) that Harry L. Edwards and George B. Newell be appointed on a " ar7 ter1113c3r basis for an indefinite period as elevator operators in the 414414g Operations and Maintenance Section of the Secretary's Office, 1 / eachviith salary at the rate of $1,200 per annum, effective as of the Nape etive dates upon which they enter upon the performance of their ties after having passed satisfactorily the usual physical exami- Approved unanimously. nO5 9/25/41 Memorandum dated September 22, 1941, from Mr. Nelson, Assist— ant Secretary, recommending that, in view of the pending resignation of lass Lois W. Jones as nurse in charge of the Emergency Room, Miss IlarY Callie Wickline, substitute nurse, be appointed to the position °f nlarse with salary at the rate of 1,800 per annum, effective as °f the date upon which she enters upon the performance of her duties aft'er having passed satisfactorily the usual physical examination. Approved unanimously. Letter to Yr. Leach, President of the Federal Reserve Bank of clutiond, reading as follows: "In connection with my letter of August 29 to Mr. Robert L. Mehornay in regard to his invitation to Mr. 111 1ford to join the Defense Contract Service, a copy of ach I sent to you, I am now in receipt of a letter from Yehornay reading as follows: 'Feeling that the matter of my letter to You of August 28th and your reply of August 29th relative to Mr. Yilford had better be in Your hands exclusively, I am taking the liberty of sending to you all copies of my letter of August 28th and the original of your letter to me of August 29th. 'The above in no way detracts from my sin— cere appreciation of this and the many other courtesies extended me by the Federal Reserve System., T 'In n view of this communication and of the replace— of the Defense Contract Service by the Division of ar7act Distribution, it is assumed that the proposed uni ngement with Mr. Milford is automatically at an end and until there should be a new request for Mr. 4-lord's services." n Approved unanimously. 9/25/41 -3Telegram to the Presidents of all of the Federal Reserve Banks reading as follows: "Reg. W-82. The classification 'new household fur. niture' includes a prefabricated fireplace, sold as a complete unit, that is decorative only and not usable for heating purposes." Approved unanimously. Letter to Mr. Hult, Assistant Cashier of the Federal Reserve 4lik of Boston, reading as follows: "Reference is made to your letter of September 17, 1941, regarding the question whether the 18 months' ma'Irity limitation provided by section 5(b) of Regulation " applies to instalment loans of less than P1,000 which are made for the purpose of purchasing or carrying homes Or for the purpose of building small low-cost homes. , "The Board agrees with your conclusion that both cdle.loans of this type referred to in your letter are !ubject to the limitations of section 5(b). However, Lhe general subject of such real estate loans is under t consideration with the thought that certain amendments vs° the regulation might be desirable, and the Board would glad to have any suggestions you might care to make ln this connection." Approved unanimously. Letter to Mr. Swanson, Vice President of the Federal Reserve tank _ Qz M inneapolis, reading as follows: ,, "Reference is made to your letter of September 10, -) 041) in which you quoted a letter from The First Bancredit 'Poration regarding Regulation W. The inquiry involves e 'Class 2 loan' under Title 811°1 the National Housing Act, and it is understood that 'Class 2' credits relate only to new structures. 1 - .e the credit is called a loan for the purposes of 9/25/a -4- "that Act, it is understood that the present question relates to a credit which is extended by a builder or materialman in connection with the sale of the product. Hence the credit would be sale credit rather than loan credit for the purposes of Regulation W. It is understood further that the credit does not involve any article in Groups A, B, C or D of the Supplement. "Since Group E, the only other classification of sale credit into which the transaction might fall, applies only to materials and services in connection with existing structures, the credit in question would not be subject to the requirements of the Regulation." Approved unanimously. Letter to MT. Joseph R. Bryson, House of Representatives, reading as follows: "Further reference is made to your memorandum of Sep19, receipt of which was acknowledged on September 22 by Governor Ransom, in which you referred to us a letter addressed to you on September 16 by the Ramseur Roofing C°mPanY, Greenville, South Carolina, with regard to the regulation of instalment credit. "The Ramseur Roofing Company telegraphed the Board Governors on September 11, asking how the 'new FHA .Jr-Itle I regulation affects the yearly payment contracts r farmers on repairs and roofing materials' and whether wueY might be 'curtailed over a three-year period'. It _a8 not altogether clear from this telegram what was meant, the Board telegraphed the Federal Reserve Bank of Richtod send the Company a copy of Regulation W and to „ 1 817er any questions it might have after referring to the ' togulation. The Board also telegraphed an acknowledgment co the Ramseur Roofing Company's telegram and advised the r4PanY that it was referring the matter to the Richmond ,_eserve Bank. credif"Regulation W provides that extensions of instalment arlsing out of the sale of materials and services 0connecti0n with repairs, alterations, or improvements urban, suburban, or rural real property in connection with existing structures, shall be repaid within 18 months, j : 4 1308 9/25/41 -5- "provided the 'deferred balance' (defined in the regulation) does not exceed $1,000. Thus the regulation does not by any means prohibit the making of home modernization loans, although it does limit the maturities of certain types of such loans to 18 months. There are, furthermore, a number of exceptions made by the regulation which relate to home modernization loans, among them being those appearing in sections 6(a), 6(b), and 6(e) of the regulation, a coPY of which is enclosed for your information. "Tie feel sure that the Federal Reserve Bank of Richmond is both desirous and able to answer any questions of the Ramseur Roofing Company regarding the meaning of any of the provisions of Regulation 17, or, if not, will obtain the answers promptly by referring the questions to the Board. "Two points regarding Regulation VI are presented by the Ramseur Roofing Company. The first has to do with the amounts and intervals of payments to be made in case the ?xtension of instalment credit has been made to farmers. number of complaints similar to that of the Ramseur '°?fing Company have been received by the Board, and the ,16aff is preparing for the Board's consideration an amendment that will meet the needs of farmers in these re8Pect3. "The other point made by the Ramseur Roofing Company is that asphalt roofing is particularly deserving of ex! InPtion from the provisions of Regulation IV; i.e., that rctensions of instalment credit for the purpose of enabl4 3 1g people to obtain re-roofing should not be restricted. Board is in receipt of numerous representations of a character, and these also have been referred to '"e staff for attention. "You may be sure that in studying the effects of lation W, with a view to possible changes, the Board give careful consideration to all of the complaints it co nas received, including that of the Ramseur Roofing wiTeanY. The letter from this Company is, in accordance " Your request, returned to you herewith." ;.r,17 11_ Approved unanimously. Thereupon the meeting adjourned.
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