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*i m\ Reproduced from the Unclassified I Declassified Holdings of the National Archives . ip d e c l a s s if ie d Authority E .6 . 1 L P'P'G! MINUTES CF IKE MEETING CF THE CPEN MARKET INVESTMENT CJ FOft THE FEDERAL RESERITB SYSTEM, HELD AS1 THE IHIERA -------- -------(F. CBICAgQ,_ ............................ OFFICE O F THIS GrO ViiljbtMOB Aufy fo PRESENT: Governors Strong, McDougal, Fancher and Harding Mr* William H. Hutt, Deputy Governor, Federal Reserve Bank of Philadelphia, representing Governor Norris to** W. B* Matteson, Secretary of the Committee Itoere were also present Honorable D* R. Crissinger, Governor of the Federal Reserve Board Mr* William A* Heath, Chairman, Federal Reserve Bank of Chicago Mr. C. R. McKay, Deputy Governor, Federal Reserve Bank of Chicago Mr. Walter W* Stewart, Director, Division of Research and Statistics, Federal Reserve Board Mr. W. R* Burgess, Assistant Federal Reserve Agent, Federal Reserve Bank of New York The meeting was called to order at 10:45 a* a* by Governor Strong, Chairman, On motion, duly seconded, the minutes of the la st isieeting of the Coo* mittee held on July 16, 1924, were formally approved without reading* A report was submitted by the Secretary reviewing the work of the Open Market Investment Committee, with accompanying statement* and data. There was also submitted a report on foreign accounts which the Federal Reserve Bank of New York had just transmitted to the banks participating in these accounts* The Chairman commented b rie fly on the work of the. Ceesaittee since the la st meeting and the changes in the credit situation* He also discussed . the recommendation of the Advisory Council for the purchase of sterlin g b i lls . The chairman expressed the opinion that any program of extensive buying of these b i l l s was not wise at this time because i t would put additional funds into the money market, was d iffic u lt because of the limited market in futures, and would be fu tile taless undertaken in connection with a larger program for bringing sterlin g to par t 'f 'j x y (~ JU jl. 3 3 3 ,- ^ 'L o TT Reproduced from the Unclassified I Declassified Holdings of the National Archives 11 W 'J ' d eclassified Authority E .6 . IBSfe - 2 A resolution was passed authorizing the Chairman to continue the usual arrangements, i f necessary and desirable, for the temporary sales of Government securities from the Special Account during the December 1924 tax period in the same manner as sales were made during the two previous tax periods* A discussion followed with regard to further purchases and sales of ii Government securities for the Special Account, and a resolution was passed recommending that the Chairman should be given authority to buy or s e ll, after conferring with the other members of the Committee, up to $100,000,000 of Government securities in order to meet any situation in the money market which might develop," There followed a discussion with regard to the replacement of the $65,000, 0Q0 of Government securities maturing December 15, 1924, held in the Special Account, I t was the consensus of opinion that this was a matter that could well be postponed until a later meeting of the Committee. The Chairman brought to the attention of the members of the Committee a statement showing that purchases of acceptances by various reserve banks had resulted in some of the banks securing b i l l holdings in excess of their res pective quotas based on earning requirements. He explained that the Secretary of the Committee in prorating future purchases would take into consideration these overages. - -- The Chairman brought before the meeting a request from the Dallas bank for special consideration in securing additional investments to enable them to somewhat increase their earnings. I t was the consensus of opinion that no special allotments could be made in fairness to other reserve banks whose earnings are also deficient. At 12:30 p. m. the Committee adjourned to meet with the Directors of the Federal Reserve Bank of Chicago. A ll nine members of that Board were present and, at their request, the Chairman of the Committee reviewed at some length the objects of the Committee, ufoat i t had accomplished, and the policy which is being pursued. Reproduced from the Unclassified / Declassified Holdings of the National Archives d e c l a s s if ie d Authority E .6 . U3Sfe - 3 There followed a general discussion which was continued at luncheon at miiich Mr* John J. Mitchell, President of the I llin o is Merchants Trust Company, Chicago, Illin o is , was also present. Adjournment was at 3:00 p* m* (Signed) W. B. MATTESGN, Secretary.
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