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Reproduced from the Unclassified I Declassified Holdings of the National Archives ,— _______ _______ d e c l a s s if ie d Authority E .6 . IBSfe C O P Y FEDERAL RESERVE BOARD WASHINGTON August 16, 1928* Dear Mr* H arrison: The Board has reviewed c a r e fu lly the rep ort o f the Open Market Investment Committee and i t s recommendations o f August 13, and has also considered the verbal d iscu ssion which took place during the meeting, and i t is in agreement with the Committee that the seasonal requirements o f c r e d it w ill probably develop a s tra in upon the future c r e d it situ a tio n which may rea ct unfavorably upon commerce and industry, and that i f such a situ a t io n should develop, the System should take some action to r e lie v e the strain* The Board would not care to agree to the purchase o f Government s e c u r it ie s , except as a la s t r e s o r t. We understand from the d iscu ssion had with your committee that you favor eas ing through the b i l l market, i f p o s s ib le , and through the Govern ment se cu rity market on ly i f unavoidable. With t h is understanding, the Board approves the purchase o f Government s e c u r itie s by the committee but lim its the amount to 0100,000,000. I f a situ a tio n should develop which w il l require re co n sid e ra tio n , the Board w ill be glad to meet the committee at any time fo r that purpose. Very tr u ly yours, (Signed) R. A. Young, Governor* Mr. George L, H arrison, Acting Chairman, Open Market Investment Committee, c /o Federal Reserve Bank, Hew York, N„ Y#
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