Full text of Minutes and Recommendations of the Federal Advisory Council : Meeting documents, February 18-19, 1963, Box 6, Volume 1961-1965

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M IN UTES OF MEETINGS

of the
FE D E R A L A D V ISO RY COUNCIL

1963




M INUTES OF MEETINGS
of the
FED ER A L ADVISORY COUNCIL

February 1849, 1963
May 2021, 1963
September 16T7, 1963
November 1849, 1963

OFFICERS AN D M E M B E R S OF THE F E D E R A L ADVISORY COUNCIL
F o r th e Y e a r 1963

O F F IC E R S :

E X E C U T IV E C O M M IT T E E :

President, George A. Murphy
Vice President, Robert B. Hobbs
Director, Howard C. Petersen
Director, J . Finley McRae
Director, Kenneth V. Zw iener
Secretary, Herbert V. Prochnow
A ssistant Secretary, W illiam J . Korsvik

George A. Murphy
Robert B. Hobbs
Howard C. Petersen
J . F inley McRae
Kenneth V. Zwiener

MEM BERS:

Lawrence H. Martin

D istrict No.
D istrict No.
D istrict No.
D istric t No.
D istrict No.
D istrict No.
D istrict No.
D istrict No.
D istrict No.
D istrict No.
D istrict No.
D istrict No.

George A. Murphy
Howard C. Petersen
L. A. Stoner
Robert B. Hobbs
J . Finley McRae
Kenneth V. Zwiener
Sidney Maestre
John A. Moorhead
Maurice L . Breidenthal
James W. Aston
E llio tt M cA llister




1

1
2
3
4
5
6
7
8
9
10
11
12

B Y -L AW S O F T H E F E D E R A L A D V I S O R Y C O U N C I L
ARTICLE I. OFFICERS
The

O ffic e rs

of

th is

tors, an d a S e c re tary ,
tiv e C o m m itte e .

C o u n c il

s h a ll

be

a

a ll o f w h o m , e x c e p t the

P re s id e n t,
S ecretary,

V ic e

P re s id e n t,

s h a ll

a ls o

th re e

D ire c ­

s e r v e a s the E x e c u ­

ARTICLE II. PRESIDENT AND VICE PRESIDENT
The

d u tie s

of

a b s e n c e th e V ic e

the

P r e s id e n t

s h a ll

be

such

as

u s u a lly

p e r ta in

to

th e

o ffic e ;

in h i s

P re s id e n t s h a ll se rv e .

ARTICLE III. SECRETARY
T he S ecretary
tio n

s h a ll be a s a la r ie d

s h a ll be fix e d by the E x e c u tiv e

ARTICLE
The

E x e c u tiv e

C o m m itte e ,

th e P r e s id e n t, V ic e

o ffic e r o f th e C o u n c il a n d h is

as

and com pensa­

EXECUTIVE COMMITTEE

IV .

in d ic a te d

P re s id e n t, an d

d u tie s

C o m m itte e .

in

th e th ree

A r tic le

I o f th e

b y - l a w s , s h a l l c o n s i s t of

D ir e c to r s .

ARTICLE V. DUTIES OF THE EXECUTIVE COMMITTEE
It
B oard

s h a ll
of

be

th e

m u lg a tio n s , and
to the C o u n c il,

re g u la r a n d
The

fo r th e

of

from

th e

E x e c u tiv e

Federal
th e

sam e

C o m m itte e

s h a ll

s p e c ia l m e e tin g s a n d

E x e c u tiv e

C o m m itte e

of a ll

m e e tin g s

A

m a jo rity

o f th e

E x e c u tiv e

s h a ll be by m a jo rity

th e

keep

in

w ith

its

power

fu ll

of th e

c lo s e

to u ch

w i t h th e

re g u la tio n s

a n d pro­

C o u n c il,

a n d to su g g e s t

of c o n s id e ra tio n .
to

fix

o f g iv in g
pow er,

th e

n o tic e
as

tim e

and

p la c e

of h o ld in g

th ere of.

o ffic e rs

o f th e

C o u n c il , to act

C o u n c il.

E x e c u tiv e

C o m m itte e

fo rw ard ed

C o m m itte e

of th o s e

to
and

m em bers

m atte rs

have

or d ig e s t th e r e o f s h a l l be im m e d ia t e ly

C o m m itte e

th e

m e th o d s

of th e

o f th e

S y ste m

to

have

s h a ll

m e e tin g s

C o m m itte e

Reserve

tim e to t im e , s p e c i a l

C o u n c il b etw e en

M in u te s

of

th e

to c o m m u n ic a te

T he E x e c u tiv e
its

d u ty

G overnors

to e a c h

s h a ll

s h a ll be

c o n s titu te

present at any

kept and

s u c h m in ute s

m e m b e r o f th e C o u n c il.
a quorum ,

and

a c tio n

o f the

m e e tin g .

ARTICLE VI. MEETINGS
R e g u la r

m e e tin g s

W a s h in g to n on the

of

ber of e ach y e ar, u n le s s
A
retary

p r e lim in a ry
in

Federal

S p e c ia l m e e tin g s

o f th e

A d v is o ry
m o n th s

o th e r w is e d ir e c te d

m e e tin g

accordance

w ith
m ay

tiv e C o m m itte e , an d s h a ll
m em bers o f th e C o u n c il.




th e

th ird T u e s d a y

o f th e

Federal

in s tr u c tio n s
be c a lle d
be

c a lle d

by

by th e

be
tim e

th e

and

by

p la c e

th e

h e ld

in

th e

C ity

of

C o m m itte e .
s h a ll

be

c a lle d

P re s id e n t

by th e

upon

be

M a y , S e p te m b e r, and N ovem ­

C o u n c il

g iv e n

P re s id e n t

2

s h a ll

E x e c u tiv e

A d v is o ry

to

at any

C o u n c il

of F ebruary,

of

by the S e c ­
the

C o u n c il.

P r e s id e n t or th e E x e c u ­

w r itte n

request

of any

three

A R T IC L E VII. A LT ERN A T ES
In

the

absence

of

th e

reg u lar

r e p re s e n ta tiv e

of any

Federal

Reserve

D i s t r i c t , the

Board of D ir e c t o r s o f th e F e d e r a l R e s e r v e B a n k o f th a t D is t r ic t m ay a p p o in t an a lte rn a te .
The a lte r n a te
C o u n c il

fo r

so ap p o in te d

w h ic h

he

has

s h a ll have
been

t h e r i g h t t o b e p r e s e n t a t a l l t h e m e e t i n g s o f th e

a p p o in te d .

He

s h a ll

have

th e

rig h t

to

take

p a r t in a l l

d i s c u s s i o n s o f th e C o u n c i l b u t s h a l l n o t be e n t i t le d to v o te .

A R T IC L E V III. AMENDMENTS
These

b y - la w s

may

be c h a n g e d

or a m e n d e d

at any

r e g u l a r or s p e c i a l m e e t i n g b y a

vote o f a m a j o r i t y o f th e m e m b e r s o f th e F e d e r a l A d v is o r y C o u n c i l .

F e b ru a r y 18, 1963




3

R E P O R T OF T H E S E C R E T A R Y
OF T H E
F E D E R A L A D V IS O R Y

C O U N C IL

FO R THE Y E A R E N D E D D E C E M B E R 31, 1962

B a l a n c e on h a n d ,

S a l a r i e s .................................................. $

D e c e m b e r 3 1 , 1 9 6 L ...................$

5 ,0 0 0 .0 0

8 ,7 1 2 .5 2
P r i n t i n g & S t a t i o n e r y ................

6 1 9 .6 0

A ssessm e nts 12 F e d e r a l R e s e r v e

B a la n c e

B a n k s .........................................

5 ,4 0 0 .0 0

on h a n d ,

D e c e m b e r 31, 1962

. . . .

$ 1 4 ,1 1 2 .5 2

8 ,4 9 2 .9 2
$ 1 4 ,1 1 2 .5 2

C h ic a g o , Illin o is
February

1, 1 9 6 3

T o the F e d e r a l A d v is o r y C o u n c i l :

I have

a u d ite d

the

books,

vouchers,

and

accounts

o f the

Secretary

of

th e

Federal

A d v i s o r y C o u n c i l fo r t h e y e a r e n d e d D e c e m b e r 3 1 , 1 9 6 2 , a n d c e r t i f y t h a t t h e a b o v e s t a t e ­
m ent ag rees th e re w ith .




R e sp e c tfu lly ,
T H E F IR S T N A T IO N A L

BANK

O F C H IC A G O

(S ig n e d ) J . C a r l S om m er, A u d ito r

4

MINUTES OF THE MEETING OF THE F E D E R A L ADVISORY COUNCIL
F e b r u a r y 18 , 1963

The

first

1963 w a s

and

o rg a n iza tio n a l

convened

in

Room

932

m e e tin g
o f the

o f th e

Federal

M a y flo w e r H o te l,

A d v is o ry

C o u n c il

W a sh in g to n ,

for th e y e a r

D. C .,

on F e b r u ­

ary 18, 1 9 6 3 , a t 9 : 3 0 A . M .
P re sen t:
L a w r e n c e H . M a r tin

D is tric t No.

1

G eorge A . M urphy

D is tric t N o.

2

H ow ard C . P e te r s e n

D is tric t N o.

3

L . A . S toner

D is tric t No.

4

Robert B. H o b b s

D is tric t N o.

5

J . F in le y M c R a e

D is tric t N o.

6
7

K enneth V. Z w ie n e r

D is tr ic t N o.

S id n e y M a e s tre

D is tr ic t No.

8

Joh n A. M oorhead

D is tric t No.

9

M a u ric e L . B r e i d e n t h a l

D i s t r i c t N o . 10

J a m e s W. A s t o n

D i s t r i c t N o . 11

E llio tt M c A llis te r

D i s t r i c t N o . 12

H erbert V. P r o c h n o w

Secretary

W illia m J . K o r s v ik

Mr. G e o r g e A .

A s s is t a n t Secretary

M urphy w a s e le c te d

C h airm a n

pro t e m a n d

Mr. W i l l i a m

J . K o rsv ik w as

electe d S ec re tary p ro tem .

The Secretary pro tem s ta te d
Federal R e se rve

banks,

th at c o m m u n ic a t io n s

c e rtify in g

to th e

e le c tio n

had

been

re c e iv e d

of th eir re s p e c tiv e

fr o m t h e t w e l v e

r e p r e s e n t a t i v e s on

the C o u n c i l fo r t h e y e a r 1 9 6 3 .

The fo llo w in g o ffic e rs w ere n o m in a te d an d u n a n im o u s ly e le c te d :
G eorge A . M urphy, P r e s id e n t
Robert B . H o b b s , V ic e P re s id e n t
H ow ard C . P e te r s e n , D ire c to r
J . F in le y M c R a e , D ir e c to r
K e n n e th V . Z w ie n e r , D ire c to r
Herbert V . P r o c h n o w , S ecretary
W illia m J . K o r s v ik , A s s is t a n t S e cre tary

On m o tion d u ly

made and

seconded,

the s a la r y

of th e S e cre tary w a s

a n n u a lly , and th a t of th e A s s is t a n t S ec retary at $ 2 ,0 0 0 a n n u a lly .




5

fix e d at $ 3 ,0 0 0

The
a u d ite d

Secretary
by

report w a s

Mr. J .

p resented
Carl

approved

h is

Som m er,

and

fin a n c ia l

report

A u d ito r

of

The

p lace d

on

file .

ordered

for

the

F irs t
A

year

1962,

N a tio n a l

copy

Bank

o f the

had

been

of C h ic a g o .

w h ic h

The

report

is

a ttac h e d and

m ade a part o f th e s e m i n u t e s .
On
C o u n c il

m o tion ,
he ld

on

d uly

made

February

and

seconded,

19 - 2 0,

1962,

the

A p ril

p rin te d
3- 4,

m in u te s

1962,

A p ril

for

ber 17-18, 1 9 6 2 , N o v e m b e r 1 9 - 2 0 , 1 9 6 2 , a n d t h e m i m e o g r a p h e d n o t e s
N o v e m b e r 19-20, 1 9 6 2 , c o p i e s

of w h ic h

had

been

th e

30-M ay

se n t p r e v io u s ly

m e e tin g s
1,

1962,

o f th e

S ep tem ­

of th e m e e tin g h e ld

to th e

m em bers

o f the

C o u n c il, w ere a p p r o v e d .

On m o tio n , d u ly
retary

to a s k

each

made and s e co n de d ,
Federal

and in c id e n ta l e x p e n s e s

Reserve

o f th e

bank

Federal

a r e s o lu tio n
to

was

c o n trib u te

A d v is o ry

a d op te d

$ 4 5 0 .0 0

C o u n c il

a u th o riz in g

tow ard

for th e y e a r

th e

th e S e c ­

se c re ta ria l

1963 and

to d ra w

u p o n t h e m fo r t h a t p u r p o s e .

A c o m p le te

l i s t o f th e

th e C o u n c i l are to be f o u n d

ite m s
in

on

th e a g e n d a

for th e

m e e tin g

th e C o n f i d e n t i a l M e m o r a n d u m

t he F e d e r a l A d v i s o r y C o u n c i l , w h i c h f o l l o w s o n p a g e s

and

th e

c o n c lu s io n s

of

to t h e B o a r d o f G o v e r n o r s from

9 , 10 a n d

11.

T he m e e tin g a d jo u r n e d at 12 :3 5 P .M .




HERBERT

V. P R O C H N O W
S ecretary

W IL L IA M

J. K O R S V IK
A s s is ta n t Secretary

,y

6

MINUTES OF T H E MEETING OF T H E F E D E R A L ADVISORY COUNCIL
F e b r u a r y 18, 1963

At

2:30

P .M .,

the

Federal

A d v is o ry

C o u n c il

convened

in

th e

B oard

Room

o f th e

Federal R e se rv e B u ild in g , W a s h in g to n , D . C .

P re sent:
P etersen, L .
M aestre,

Mr. G e o r g e A . M u r p h y , P r e s i d e n t ; M e s s r s . L a w r e n c e H . M a r tin , H o w a r d C .
A . S tone r, R o b e rt B . H o b b s , J .

John

A.

M oorhead,

M a u ric e

L.

F in le y

M c R a e , K e n n e t h V . Z w i e n e r , S id n e y

B r e id e n th a l,

J a m e s W.

A ston,

and E llio tt

M c A llis te r.

M e m b e rs o f th e B o a r d ' s D i v i s i o n o f R e s e a r c h a n d S t a t is t ic s p a r t ic ip a t e d in an a u d io ­
v isu al p r e s e n ta tio n on th e c u r re n t e c o n o m ic s it u a t io n .




HERBERT

V. PROCHN OW
Secretary

W IL L IA M J . K O R S V IK
A s s is t a n t Secretary

7

MINUTES OF T H E M E E T I N G O F T H E F E D E R A L A D V I S O R Y C O U N C I L
F e b r u a r y 1 8 , 1983

A t 9 :4 0 P .M . , the F e d e r a l A d v i s o r y C o u n c i l r e c o n v e n e d in

Room

9 3 2 o f th e M a y flo w e r

H o te l, W a s h in g to n , D . C .

P re sent:

Mr. G e o r g e A . M u r p h y , P r e s i d e n t ;

P etersen , L . A . S ton e r, R o b e r t B . H o b b s , J .
M ae stre , J o h n A . M o o r h e a d , M a u r ic e L .

The C o u n c il re v ie w e d
th e

o ffic e

of

th e

its

c o n c lu s io n s

S ecretary

of

the

F in le y

B r ie d e n th a l,

H erbert V. P r o c h n o w , S e c r e t a r y , a n d W i l l ia m

to

M essrs.

J.

M cRae,
Jam es

of

the

K enneth

V . Z w i e n e r , S id ne y

W. A s t o n , E l l i o t t M c A llis te r ,

ite m s

G overnors

w h ic h f o llo w s on p a g e s 9, 10 a n d

11, l i s t i n g th e a g e n d a it e m s

by t h e C o u n c i l .

w a s d e liv e re d

The Memorandum

H . M a r tin , H ow ard C .

K o r s v ik , A s s is t a n t S ecretary.

r e g a rd in g

B oard

Law rence

to th e

on

the

agenda,

a n d sent

the

C o n f i d e n t i a l Memorandum

and

th e c o n c l u s i o n s reached

Federal

Reserve

B u i l d i n g a t 1 1 :4 5

H ERB ER T

V. PRO CH N O W

P .M . on F e b ru a r y 18, 1 9 6 3 .

T he m e e tin g a d jo u r n e d a t 1 0 :5 0 P .M .




Secretary

W IL L IA M

J . K O R S V IK

A s s i s t a n t Secretary

8

CONFIDENTIAL

MEMORANDUM

TO THE B O A R D
FROM

FEDERAL
R E L A T IV E

THE

A D V IS O R Y C O U N C IL

TO T H E A G E N D A

FOR

ON F E B R U A R Y

1.

W hat are
n o m ic

the o b s e r v a t io n s

d e v e lo p m e n ts ,

and

Board

has

in

th e

T H E JO IN T M E E T IN G

1 9 , 1963

C o u n c il

re g a rd in g (a) recent d o m e s tic

b u s in e s s

o u tlo o k

for t h e

first

eco­

h a l f o f 19 63

( c ) D o th e m e m b e r s o f th e C o u n c i l b e l i e v e th a t the

b u s in e s s

stre n g th e n e d

o f the
(b)

a n d th e y e a r a s a w h o l e ?
im p ro v e m e n ts

OF GOVERNORS

p sy c h o lo g y

further

reported

s in c e

at the N o v e m b e r m e e tin g w ith

th a t tim e ,

re m ain e d

a b o u t t h e s a m e , or

receded?

a)

Recent

d o m e stic

e c o n o m ic

m ixed tre nd s

th at h a v e

p r e v a ile d

the

past

d e v e lo p m e n ts
several

of c o n s u m e r s , a s e v i d e n c e d by r e t a i l s a l e s

a n d in

in d ic a te

m o nth s.

a c o n tin u a tio n

W h ile

o f th e

th e s p e n d i n g b e h a v io r

p a r t i c u l a r by th e v o lu m e o f new m o d e l

a u t o m o b i l e s s o l d , h a s b e e n e n c o u r a g i n g , t h e d e c l i n e i n n e w o r d e r s fo r d u r a b l e g o o d s , th e
fa ilu re o f in d u s t r i a l

p ro d u c tio n

sage,

the

together

w ith

to r i s e ,

d is c u s s io n

of

and
a

the

u n c e rta in ty

p o s s ib le

tax

cre ate d

cu t,

have

by th e

clo u d e d

Budget Mes­

the im m e d ia te

o u tlo o k .

b)

D e s p ite

th e se

im p o n d e r a b le s ,

how ever,

th e

C o u n c il

a n tic ip a te s

that

b u s in e s s in th e firs t h a l f o f 1963 w i l l c o n t i n u e to s h o w th e m o d e r a te im p r o v e m e n t th a t c h a r a c ­
te r iz e d the l a s t s ix m o n t h s o f 1 9 6 2 .

c)
p o r te d

at th e

The

in E u r o p e , C a n a d a
paym ents,

C o u n c il

Novem ber

budget

and

T h e o u t l o o k fo r t h e l a s t h a l f o f 1 9 6 3 i s l e s s c e r t a i n .

b e lie v e s

m e e tin g

has

th at

the

receded

im prov em en t
som ew hat

C u b a , t o g e t h e r w it h th e

d e fic its ,

and

e s p e c ia lly

th e

in

s in c e

b u s in e s s
th at

p ro b le m s

a s s o c ia te d

proposed

tax

tim e .

ps y c h o lo g y

re­

D e v e lo p m e n ts

w ith the b a la n c e o f

le g isla tio n ,

have

le s s e n e d

th e f a v o r a b l e s e n t i m e n t i n t h e b u s i n e s s c o m m u n i t y .
2.

In

th e

o p in io n

of

th e

C o u n c il,

w hat

facto rs

s u g g e s t th e m o s t s t r e n g t h or e n c o u r a g e m e n t ?

in

th e

current

e c o n o m ic

picture

C o n v e r s e ly , w hat facto rs app e ar

to be o f g r e a t e s t c o n c e r n ?
In th e o p i n i o n
m ajor

source

absence

of

o f th e C o u n c i l , th e p e r s i s t e n t s tr e n g th o f c o n s u m e r b u y in g is a

encouragem ent

of g ro w th

in

in v e n to rie s

in

th e

current

suggest

th at

e c o n o m ic
new

orders

p ic tu re .
and

T h is

p ro d u c tio n

facto r
w ill

and

the

pro bab ly

r is e , r e s u l t i n g in s o m e i m p r o v e m e n t in e m p l o y m e n t , i n c o m e , a n d o v e r - a ll e c o n o m i c a c t i v i ­
ty .

A b u ild - u p o f in v e n t o r ie s




by

ste el

users

9

in

a n tic ip a tio n

of a s tr ik e c o u ld a l s o con-

trib u te to a r is e in b u s i n e s s in the m o n t h s i m m e d i a t e l y a h e a d .
E x c e s s p ro d u c tiv e c a p a c it y , the la c k o f v ig o r in c a p i t a l e x p e n d i t u r e s , th e r e la t iv e ly
high

le v e l of u n e m p lo y m e n t, a n d r e c e n t d e v e l o p m e n t s

newspaper

s trik e s

and

th e

d ep arture

from

the

in

la b o r n e g o tia t io n s ,

g u id e lin e s

in

the

dock

such

s trik e

as

the

s e ttle m e n t,

a re c u r r e n t l y m a t t e r s o f e c o n o m i c c o n c e r n .

3.

What

are

th e

prospects

for

lo a n

m onths, in c lu d in g d em and in
b a n k in g s y ste m

co n sid e re d

dem and

v a r io u s

a m p le

lo a n

at

banks

d u rin g

c a te g o rie s ?

to a c c o m m o d a t e

th e

next

several

I s t h e l i q u i d i t y o f th e

th e

present and

fo rs e e a b le

v o lu m e o f c r e d it d e m a n d s ?

The

m em bers

o f th e

C o u n c il

d u r in g th e n e x t s e v e r a l m o n t h s .
goods sector, e s p e c ia lly
re o p e n in g
liq u id ity

of

the

of th e

ste el

if ste el users
lab o r

b a n k in g

a n tic ip a te

Som e in c r e a s e in
add

co ntract.

syste m

is

a

m od erate

lo an s

is

in c re a s e

lik e ly

to th e ir in v e n t o r i e s

The

ad eq uate

m em bers

of

because

the

to a c c o m m o d a t e

in

lo a n

to o c c u r in

C o u n c il

th e

dem and

th e d u ra b le

o f th e

p o s s ib le

b e lie v e

t h a t th e

present

and

fo rs e e a b le

le n d in g

sta n d a rd s,

v o lu m e o f c r e d it d e m a n d s .

4.

D o e s the C o u n c il d e t e c t a n y

sy m p to m s

o f d e te rio ra tio n

in

p a r t i c u la r ly in th e f i e l d o f r e a l e s t a t e c r e d i t ?

The
la r ly in th e

C o u n c il

fie ld

the m a t u r it ie s

has

observed

of real e sta te

of term

lo an s .

som e

c re d it.

d e te r io ra tio n

There

H ow ever,

has

le n d in g

a ls o

in

le n d in g

been

som e

standards

standard s,
pressure

g e n e ra lly

are

p a rticu ­

to le n g th e n

c o n s i s t e n t w ith

sou nd b a n k in g p ra c tic e s .

5.

(a)
the

The

Board

w o u ld

area o f tim e

and

a p p re c ia te

s a v in g s

the c o s t b u rd e n o f h ig h e r in t e r e s t
banks

of funds

rep re sen te d

c o m m e n ts

d e p o s its ,

by

rate

such

w ith

respect

in c lu d in g
le v e ls ,

d e p o s its

the

and

to d e v e lo p m e n ts

trend

of such

w h e t h e r th e

have

been

in

d e p o s its ,

uses

c o n s iste n t

made
w ith

by
ac­

c e pte d s ta n d a rd s o f b a n k liq u id ity a n d a s s e t q u a lit y .
(b)

Does

the

C o u n c il

b e lie v e

from th e r a p id l y e x p a n d i n g u s e
or t h a t
d e p o sits

unsound

b a n k in g

of th is

ty p e ?

th at

c o n d itio n s
How

c o m p e titiv e

of n e g o tia b le
m ig h t

w o u ld

the

per c e n t in th e m a x im u m p e r m i s s i b l e

abuses

corporate

a ris e

from

C o u n c il

lik e ly

w id e s p re a d

regard

in te r e s t rate

are

c e rtific a te s

an

to

arise

of d e p o sit
re lia n c e

in c r e a s e

on

to 3 - 1 / 2

p a y a b le un d er R e g u la tio n

Q

on tim e d e p o s its h a v in g a m a tu r ity o f l e s s th a n s ix m o n t h s ?

(a)

A lth o u g h

cre ase has s lo w e d c o n s id e ra b ly
th erm o re ,

because

of

s h ifts

in

tim e

and is
th e

and

d is tr ib u tio n

y e a r , th e s q u e e z e on b a n k p r o f it s c u r r e n t ly i s
th e p r e s s u r e to e x p a n d
w hat.

As

ards,

but

m a tu ritie s and

g e n e ral,

th e

le n d in g

and

of

le ss

bank

has

been

in v e s tm e n t

10

c o n tin u e

th an

it w a s

a sse ts

th at

th a n it w a s

som e

p o lic ie s

accep te d s tan dard s of b a nk liq u id ity and a s s e t q u a lity .




d e p o s its
le s s

to b u y h ig h e r y i e l d i n g

th e C o u n c i l h a s o b s e r v e d , t h e r e
in

s a v in g s

s u b s ta n tia lly

to e x p a n d , th e rate o f in ­

a year ago.
w ere

a year ago.

asse ts

has

lib e ra liz a tio n
have

been

Fur­

e ffe cted

la s t

A c c o r d in g ly ,

le sse n e d
in

som e­

c r e d it stan -

c o n s is te n t

w ith

b)
arisen

from

that

unsound

th is

ty pe .

su lte d
use

ra p id ly

b a n k in g

H ow ever,

in

of

The

the

im p o rta n t

th ese

C o u n c il

e x p a n d in g

use

c o n d itio n s
th e

does

have

g ro w th

not

a ris e n

s h ifts

in

th e

of

d ep o sit

ty pes

to

re lian c e

c e rtific a te s

a sse ts.

te nd

s ig n ific a n t co m p e titiv e

w ide sp read

corporate

of bank

w ill

th at

corporate c e rtific a te s

fr o m

of n e g o tia b le

c e rtific a te s

b e lie v e

of n e g o tia b le

on

d ep osits

the

of

o f d e p o s i t h a s re ­

A c o n tin u in g e x p a n sio n

le sse n

ab uses have

o f d e p o s i t or

liq u id ity

of

th e

in t h e

b a n k in g

s y s te m b e c a u s e o f th e p r e s s u r e to u s e t h e s e f u n d s p r o f i t a b l y .
The C o u n c il
c r e a s e to 3 - 1 / 2

b e lie v e s

th a t b a n k e r s g e n e r a lly w o u ld not p re se n tly favor an i n ­

per c e n t in the m a x im u m

p e r m is s a b le in t e r e s t rate p o s s ib le u n d er R e g u ­

latio n Q on tim e d e p o s i t s h a v i n g a m a t u r ity of le s s th an s ix m o n th s .
6.

Has

the

C o u n c il

noted

part o f th e b u s i n e s s
paym ents

any

and

te n d e n c y

tow ard

th e

h e igh te ne d

concern

on the

f i n a n c i a l c o m m u n i t y w ith r e s p e c t to U .S . b a la n c e of

d e v e lo p m e n ts ?

Are

th e

d iffic u lt

n e g o tia tio n s

g o in g

on

w ith in

th e

E u r o p e a n E c o n o m i c C o m m u n it y a fa c to r to be ta k e n in t o a c c o u n t a n d a s u b je c t
o f c o n c e rn to b a n k c u s t o m e r s .
The

C o u n c il h a s

n o tic e d

in c r e a s in g

f in a n c ia l c o m m u n ity w ith r e s p e c t to th e U .S .
in te r n a tio n a l in v e s tm e n t
b a la n c e

of

paym ents

and/or

trade

d e v e lo p m e n ts ,

concern

b a la n c e

in te r e s ts
but

are

a ls o

on

th e p a r t o f th e b u s i n e s s an d

of paym ents.

p a rtic u la rly

w ith

th e

C usto m ers who have

concerned

d iffic u lt

not o nly

n e g o tia tio n s

w ith

g oing

on

w ith in the E u r o p e a n E c o n o m i c C o m m u n i t y .

7.

T he B oard w o u ld a p p r e c ia te

th e C o u n c i l 's

c o m m e n t s on e f f e c t s o b s e rv e d th us

fa r from t h e d e p r e c i a t i o n a n d t a x c r e d i t p r o v i s i o n s a d o p t e d i n 1 9 6 2 .

W ith th e e x c e p t i o n o f c e r t a i n i n d u s t r i e s , th e C o u n c i l h a s o b s e r v e d few e f fe c t s
th at

it

w o uld

8.

a ttrib u te

What

are

the

to

th e

d e p re c ia tio n

C o u n c il’ s

v ie w s

and

tax

re g a rd in g

c re d it

the

p r o v is io n s

im p a c t

ad op te d

of

m o ne tary

c re d it

p o lic y

in

and

1962.

c re d it

p o lic y under current c o n d it io n s ?

The

C o u n c il

gene rally fa v o r a b le

b e lie v e s

th at

im p a c t on the

current

econom y.

m o ne tary

T h is

p o lic y

and
has

been

has

had

a

a c o n s tr u c tiv e factor

in t h e d o m e s t i c e c o n o m y a n d a t t h e s a m e t i m e h a s b e e n h e l p f u l t o t h e b a l a n c e o f p a y m e n t s .

* :|; *
The
purposes

of

P.

C o u n c il
L.

fo r e i g n c o u n t r i e s . **

favo rs

87-588,

the

“ To

:|: :|:

r e v is io n

im p r o v e

of

the

R e g u la tio n
u s e fu ln e s s

M in te n d e d
of

n a tio n a l

carry

out the

branches

in

In c o n s i d e r i n g th e B o a r d ' s p r o p o s e d r e v i s io n , m e m b e rs of the C o u n c il

have r e v ie w e d th e c o m m e n t s o f c e r t a i n

n a tio n a l b a n k s w ith b ran ch e s abro ad.

c il b e lie v e s th a t t h e ir s u g g e s t i o n s m e r it c o n s i d e r a t i o n by th e B o a r d .




to

bank

11

The C o u n ­

MINUTES OF JOINT C O N F E R E N C E OF T H E F E D E R A L ADVISORY COUNCIL
A N D T H E B O A R D OF G O V E R N O R S OF T H E F E D E R A L R E S E R V E SYSTEM

F e b r u a r y 1 9 , 1963

At

10 :3 0

A .M .,

a

of G o v e r n o r s o f the

jo in t

confe rence

Federal Reserve

of

the

S y stem

Federal

was

A d v is o ry

he ld

in

th e

C o u n c il

B oard

and

Room

the B o ard

of the F e d e r a l

R e se rv e B u ild in g , W a s h in g to n , D . C .

P re sen t:

M e m b e rs o f th e B o a rd o f G o v e r n o r s o f th e F e d e r a l R e s e r v e S y s te m :

C h airm a n
J.

L.

Wm.

R o be rtso n

M cC.

and

M a rtin ,

Chas

N.

Jr.;

V ic e

C h a irm a n

Shepardson;

a ls o

C.

Mr.

Canby

M e rritt

B a ld e rs to n ;

Sherm an,

G overnors

S ecretary,

and

Mr. K e n n e t h A . K e n y o n , A s s i s t a n t S e c r e t a r y o f th e B o a r d o f G o v e r n o r s .

P re sen t:

M em bers of the F e d e r a l A d v is o r y C o u n c il:

M r. G e o r g e A . M u r p h y , P r e s i d e n t ; M e s s r s . L a w r e n c e
L.

A.

S to n e r,

Robert

B.

Hobbs,

J.

F in le y

M cRae,

H . M a rtin , H o w a rd C . P e te rs e n ,

K enneth

V.

Z w ie n e r ,

S id n e y

M aestre,

J o h n A . M o o r h e a d , M a u r ic e L . B r e i d e n t h a l, J a m e s W. A s t o n , E l l i o t t M c A l l i s t e r , H e rb e rt V.
P ro c h n o w , S ecretary, and W illia m

P re s id e n t
C o u n c il

as

M urphy

read

expressed

in

the

the

J . K o rs v ik , A s s is ta n t S ecretary.

firs t

ite m

Confidential

on

the

Agenda

Memorandum

to

F e d e r a l A d v i s o r y C o u n c i l , a s p r in t e d o n p a g e s 9 , 10 a n d
d is c u s s io n

on

the

b u s in e s s

o u tlo o k

lin e d d e v e lo p m e n ts a n d c o n d it io n s

fo llo w e d

in

and

the

the

Board

11 o f t h e s e

w h ic h

th e

c o n c lu s io n s

of Governors
m in u te s .

m em bers

in th e ir p a r t ic u la r d is t r ic t s .

of

An extended

the

T h e ir w as

o f the

from the

C o u n c il out­

general a g re e ­

m e n t th a t b u s in e s s in th e fir s t h a l f o f 19 6 3 w o u ld c o n t in u e to im p r o v e m o d e r a te ly .
m e m b e rs o f th e C o u n c il s a id

Several

t h a t t h e r e j e c t i o n o f t h e B r i t i s h b id for e n t r y i n t o th e C o m m o n

M arket h ad h ad an u n s e ttlin g e ffe c t on th e p s y c h o lo g y o f th e b u s in e s s c o m m u n ity .

The

P re s id e n t

b rie f d is c u s s io n

P re s id e n t
m arks
fo r

th en

M urphy

th a t fo llo w e d

n e g o tia b le

read

the

second

ite m

and

th e

c o n c lu s io n s

of

th e

C o u n c il.

A

fo llo w e d .

read

the

in c lu d e d

c e rtific a te s

th ird

ite m

and

a d is c u s s io n

of

d e p o s it.

th e

c o n c lu s io n s

r e g a rd in g

Several

th e

o f the

sta tu s

m em bers

C o u n c il.

of the

su g g e ste d

T h e re­

secondary

th at

th e

m arket

secondary

m a r k e t for c e r t i f i c a t e s h a d im p r o v e d .

The

P re s id e n t

th e n

read

th e

fo u rth

ite m

on

the

c u s s io n th at fo llo w e d , som e m em bers a c k n o w le d g e d
ards

had

a tio n
fo r

occurred.

over

an

e a rn in g s

c o n trib u te d

They

extended
to

to

p ro v id e
th is




s u g g e ste d

p e rio d
for

of

a

in te re s t

d e v e lo p m e n t.

th at

the

r e la tiv e ly
pay m ents

O th er

in te n s e
easy
on

m em bers

12

Agenda.

D u rin g

th at a d e te rio ra tio n

a
of

c o m p e titio n
m o n e tary
larg e r
the

for

v o lu m e

of

general d is ­

lo a n s ,

p o lic y ,

C o u n c il

th e

of le n d in g sta n d ­

and
tim e

w ere

th e c o n t in u ­

the

n e c e s s ity

d e p o s its ,

le s s

d is p o s e d

had
to

u se th e

w ord

p r a c tic e s .

d e te rio ra tio n

and

argued

th at

there

had

been, in s te a d , c h a n g e s

in l e n d i n g

In m a n y i n s t a n c e s , t h e s e m e t c o m m u n i t y n e e d s a n d r e f l e c t e d f a v o r a b l y o n t h e

b a n k in g s y s te m .
S e v e r a l m e m b e r s s a i d t h e y w e re d i s t u r b e d by r e p o r ts o f a u t o l o a n s r u n n in g 42 m o n th s
to m a t u r i t y .
P re s id e n t
C o u n c il.

M urphy

He added

th e d e s i r a b i l i t y

of an

on t i m e d e p o s i t s
lik e

to

see

the

read

th e

th a t th ere

fifth

was

in c r e a s e

item

to 3 - 1 / 2

the

Agenda

e lim in a te d

and

of o p in io n

per c e n t in

h a v in g a m aturity of le s s
r e g u la tio n

on

so m e d iffe r e n c e

the m a x im u m

th a n s ix m o n th s .

e n tire ly ,

the

the

m ajo rity

c o n c lu s io n s

w ithin

of

the

t h e C o u n c i l a s to

in te r e s t rate p a y a b le

W h ile s o m e m e m b e rs w o u ld
of b a n k e r s

w o u ld

fa v o r the

rete n tio n o f R e g u l a t i o n Q a n d th e p r e s e n t m a x im u m p e r m is s ib le r a t e s .
C h airm a n

M a rtin ,

in

r e p ly

to

an

in q u ir y

from

a m e m ber of th e

C o u n c il,

there w a s no g re a t p r e s s u r e a t th e m o m e n t to c h a n g e th e r e g u la t i o n .
p la c e d

on

creases

in

th e

Agenda

for th e

R e g u la tio n

Q

purpose

m a x im u m

of d is c u s s io n .

rates

w ere

p a y m e n t s a n d to th e m o v e m e n t o f sh o rt- te rm f u n d s .
look w ith fa v o r on th e s e p a r a t i o n o f d o m e s t ic

He

rela te d

to

sug ge ste d,
the

s ta te d th at

T he item had been
how ever,

d e fic it

in

th e

that in ­

b a la n c e

of

T h e C h a ir m a n a d d e d th a t he d id not

a n d fo re ig n tim e d e p o s its w hen d is c u s s in g

in te re s t rate l im i t a t i o n s .
P r e s i d e n t M u rp h y r e a d th e s ix t h it e m a n d the c o n c l u s i o n s of th e C o u n c i l .

C h a ir m a n M a rtin
a

furth er e a s i n g

q u e s tio n e d

of

money.

w h e th e r the d o m e s tic

A

re la te d

q u e s tio n ,

he

economy

s h o u ld

c o n tin u e d ,

b e s t i m u l a t e d by

in v o lv e d

w h ic h the b a l a n c e o f p a y m e n t s w a s a f f e c t e d b y i n t e r e s t rate d i f f e r e n c e s .
added th at it w a s h is
rated.

vie w

th at d o m e s tic

and

the

e x t e p t to

The C h airm an

in te r n a tio n a l p ro ble m s c o u ld

n o t be s e p a ­

T he C o u n c il m e m b e rs rep orte d th a t th e y had no e v id e n c e th at le g itim a te d e m a nd s

for c r e d i t w e r e u n s a t i s f i e d .

C h airm a n

M a rtin n o te d th a t a lth o u g h

lo an dem and

had been

good d u r i n g th e p a s t y e a r , th e c o n v e n t i o n a l l y - d e f i n e d m o n e y s u p p l y h a d b e g u n to c o n t r a c t
a g ain re c e n tly .

As

a r e s u lt, there w ere th o s e

w ho m a in ta in e d

had fo llo w e d a to o r e s t r ic t iv e m o n e ta ry p o lic y .

The

m em bers

a

s u b s ta n tia l

th a t th e F e d e r a l R e s e r v e
o f th e

C o u n c il

in d ic a te d

they d id n o t a g r e e .
C h airm a n

M a rtin

in d ic a te d

tim e a n d s a v i n g s d e p o s i t s

that

he

b e lie v e d

p o r tio n

o f th e

grow th

of

o v e r th e p a s t y e a r m i g h t be r e g a rd e d a s v i r t u a ll y th e e q u i v a ­

lent of d e m a n d d e p o s i t s .
G o v e rn o r B a l d e r s t o n s t a t e d t h a t p rio r to th e c h a n g e in R e g u l a t io n Q , tim e a n d s a v in g s
d e p o s i t s h a d b e e n g r o w i n g a t a n a n n u a l r a t e o f a b o u t 12 per c e n t .

S u b s e q u e n tly they had

g ro w n a t a n a n n u a l r a t e o f 18 p e r c e n t .
The

P r e s id e n t th en

o f th e C o u n c i l .

read

th e

7th a n d

A very b rie f d i s c u s s i o n

8th ite m s

fo llo w e d .

The meeting adjourned at 1:00 P.M.




13

on th e

Agenda

and

th e c o n c l u s i o n s

NOTE:
T h i s t r a n s c r i p t o f t h e S e c r e t a r y 1 s n o t e s is n o t to b e
regarded, as c o m p l e t e o r n e c e s s a r i l y e n t i r e l y a c c u r a t e .
The
t r a n s c r i p t is f o r t h e s o l e u s e o f t h e m e m b e r s of t h e F e d e r a l
Advisory Councils
T h e c o n c i s e o f f i c i a l m i n u t e s f o r the
entire y e a r are p r i n t e d a n d d i s t r i b u t e d l a t e r 0
H 0V 0P 0
WoJ*K0
The S e c r e t a r y ?s n o t e s o f t h e m e e t i n g o f t h e F e d e r a l A d v i s o r y
C o u n c i l o n F e b r u a r y 1 8 , 1 9 6 3 , a t 9 s 3 0 A * M es, i n R o o m 9 3 2 of
the M a y f l o w e r H o t e l , W a s h i n g t o n , D® C 0 A l l m e m b e r s of the
F e d e r a l A d v i s o r y C o u n c i l w e r e present,,
The S e c r e t a r y p r o v i d e d e a c h m e m b e r w i t h a l i s t o f a l l the m e m b e r s
the C o u n c i l f o r t h e y e a r 1 9 6 3 , o f f i c i a l l y e l e c t e d i n a c c o r d a n c e w i t h
:orjiuni cat i o n s r e c e i v e d f r o m t h e F e d e r a l R e s e r v e b a n k s 0
Mr. G e o r g e A* M u r p h y w a s e l e c t e d C h a i r m a n p r o
Icrsvik w a s e l e c t e d S e c r e t a r y p r o t e m P
The f o l l o w i n g

officers

were

nominated

t e m a n d Mr,

W i l l i a m J<

a n d u n a n i m o u s l y elected?

G e o r g e A. M u r p h y 9 P r e s i d e n t
Robert B 0 Hobbs, Vice President
Howard C 0 Petersen, Director
J. F i n l e y M c R a e , D i r e c t o r
Kenneth V 0 Zwiener? Director
Herbert V Q Prochnow, Secretary
W illiam J c Korsvik, Assistant Secretary
On m o t i o n , d u l y m a d e
---7-ec. at $ 3 , 0 0 0 a n n u a l l y ,
dually.

a n d s e c o n d e d , t h e s a l a r y of t h e S e c r e t a r y w a s
a n d t h a t o f t h e A s s i s t a n t S e c r e t a r y at $ 2 * 0 0 0

^ The S e c r e t a r y p r e s e n t e d t h e f i n a n c i a l r e p o r t f o r t h e y e a r 1 9 6 2 P
%"?ri
k e e n a u d i t e d b y M r 0 J 0 C a r l S o m m e r , A u d i t o r of The First
i^'ional B a n k o f Chicago,,
T h e r e p o r t w a s a p p r o v e d a n d p l a c e d on file,
'fill be p r i n t e d a n d i n c l u d e d i n t h e f o r m a l p r i n t e d m i n u t e s 0
, ^ A m o t i o n w a s a d o p t e d a u t h o r i z i n g t h e S e c r e t a r y to d r a w d r a f t s f o r
upon e a c h F e d e r a l R e s e r v e B a n k f o r t h e s e c r e t a r i a l a n d i n c i d e n t a l
'irises of t h e F e d e r a l A d v i s o r y C o u n c i l f o r t h e y e a r 1 9 6 3 o
^ The b y - l a w s w e r e
r',;e3 for t h e m e e t i n g
A\ t h e 1 9 6 2 m e e t i n g s
^ o u s l y to m e m b e r s




approved,.
T h e C o u n c i l a p p r o v e d t h e S e c r e t a r y !s
of N o v e m b e r 1 9 ~ 2 0 , 1 9 6 2 D T h e p r i n t e d m i n u t e s for
o f t h e C o u n c i l , c o p i e s of w h i c h h a d b e e n sent
o f t h e C o u n c i l , a l s o w e r e approved,,

ITEM I
tfgAT A R E T H E O B S E R V A T I O N S O P T H E C O U N C I L R E G A R D I N G - (a) R E C E N T
DOMESTIC E C O N O M I C D E V E L O P M E N T S , A N D (b) T H E B U S I N E S S O U T L O O K F O R
FIRST H A L F OF 19 6 3 A N D T H E Y E A R AS A WHOL E ?
(c)
DO THE MEMBERS
THE C O U N C I L B E L I E V E T H A T T H E I M P R O V E M E N T I N B U S I N E S S P S Y C H O L O G Y
^PORTED AT THE NOVEMBER MEETING WITH THE BOARD HAS STRENGTHENED FUR­
THER S I N C E T H A T T I M E , R E M A I N E D A B O U T T H E S A M E , O R R E C E D E D ? _______________

j

Murphy w e l c o m e d t h e n e w m e m b e r s
invited e a c h m e m b e r t o c o m m e n t .

to t h e

Council.

He

then read Item I

A general d i s c u s s i o n on r e c e n t economic developments follo w e d w h i c h
suggested a c o n t i n u a t i o n o f t h e m i x e d t r e n d s t h a t h a d p r e v a i l e d i n t h e
devious s e v e r a l m o n t h s .
A n u m b e r of m e m b e r s l i s t e d as e n c o u r a g i n g t h e
lending b e h a v i o r o f c o n s u m e r s as e v i d e n c e d b y r e t a i l s a l e s a n d i n p a r t i ­
cular by the v o l u m e o f n e w a u t o m o b i l e s s o l d .
The d e c l i n e in n e w orders
durable g o o d s , t h e f a i l u r e o f i n d u s t r i a l p r o d u c t i o n t o r i s e , a n d t h e
•-certainty c r e a t e d b y t h e B u d g e t M e s s a g e , t o g e t h e r w i t h t h e d i s c u s s i o n
0f a p o s s i b l e t a x c u t , h a v e c l o u d e d t h e i m m e d i a t e o u t l o o k .
Despite t h e s e d e v e l o p m e n t s , t h e m e m b e r s a n t i c i p a t e t h a t b u s i n e s s in
::_e first h a l f o f 1 9 6 3
w i l l c o n t i n u e to s h o w t h e m o d e r a t e i m p r o v e m e n t
-hat c h a r a c t e r i z e d t h e l a s t s i x m o n t h s o f 1 9 6 2 *
The o u t l o o k for the last
half of 1 9 6 & is l e s s c e r t a i n .
There w a s f a i r l y w i d e a g r e e m e n t t h a t t h e i m p r o v e m e n t i n b u s i n e s s
rsjchology r e p o r t e d a t t h e N o v e m b e r m e e t i n g h a d r e c e d e d s o m e w h a t s i n c e
:'nat time.
S e v e r a l m e m b e r s c i t e d as a d v e r s e f a c t o r s r e c e n t e v e n t s i n
I^ope, C a n a d a , a n d C u b a , t h e p r o b l e m s a s s o c i a t e d w i t h t h e b a l a n c e o f
regents a n d b u d g e t d e f i c i t s , a n d t h e p r o p o s e d t a x l e g i s l a t i o n .
I n the
opinion of m o s t o f t h e m e m b e r s o f t h e C o u n c i l , t h e s e d e v e l o p m e n t s h a v e
lessened t h e f a v o r a b l e s e n t i m e n t i n t h e b u s i n e s s c o m m u n i t y *
I T E M II
IT T H E O P I N I O N O F T E E C O U N C I L , ..WE A T . . . F A C T O R S I N THE. C U R R E N T E C O N O M I C
PICTURE..SUGGEST! THE. M0.S.T S T R E N G T H O R E N C O U R A G E M E N T ?
CONVERSELY,
:I5AT. J?A.CTORS__ A P P E A R T O B E O F G R E A T E S T C O N C E R N ?
.‘
foppky r e a d I t e m I I a n d o b s e r v e d t h a t m a n y f a c t o r s b e a r i n g o n t h i s
^ e c t had b e e n c o n s i d e r e d in the p r e c e d i n g d i s cussion.
A c c o r d i n g l y * the
^-".ents t h a t f o l l o w e d w e r e r a t h e r b r i e f .
It w a s g e n e r a l l y a g r e e d t h a t t h e p e r s i s t e n t s t r e n g t h of c o n s u m e r
is t h e
m a j o r s o u r c e of e n c o u r a g e m e n t in t h e c u r r e n t e c o n o m i c pic* A n u m b e r of m e m b e r s n o t e d t h a t the a b s e n c e of g r o w t h in inventories
^■??ssted t h a t n e w o r d e r s a n d p r o d u c t i o n w i l l p r o b a b l y r i s e , r e s u l t i n g i n
•^ i m p r o v e m e n t i n e m p l o y m e n t , incojne a n d o v e r - a l l e c o n o m i c a c t i v i t y .
' Possible b u i l d - u p o f i n v e n t o r i e s b y s t e e l u s e r s i n a n t i c i p a t i o n of a
e could also c o n t r i b u t e to a r i g e in b u s i n e s s in the m o n t h s i m m e diately
Mart*•
^xcess p r o d u c t i v e c a p a c i t y , t h e l a c k o f v i g o r i n c a p i t a l s p e n d i n g , t h e
,'^tively h i g h l e v e l o f u n e m p l o y m e n t , r e c e n t d e v e l o p m e n t s i n l a b o r
.^Jtiations, s u c h as t h e n e w s p a p e r s t r i k e s , a n d t h e d e p a r t u r e f r o m the
-alines
a r e c u r r e n t l y m a t t e r s of e con omi c
 i n t h e d o c k s t r i k e s e t t l e m e n t ,

ncern*



IT E M III
tfHAtt A R E T H E P R O S P E C T S F O R L O A N D E M A N D A T B A N K S D U R I N G T H E N E X T S E V E R A L
MONTHS', I N C L U D I N G D E M A N D I N V A R I O U S L O A N C A T E G O R I E S ?
IS T H E L I Q U I D I T Y
QT? THE B A N K I N G S Y S T E M C O N S I D E R E D A M P L E T O A C C O M M O D A T E T H E P R E S E N T A N D
FO R E S E E A B L E V O L U M E O F C R E D I T D E M A N D S ? ___________________________________________ _
Murphy r e a d I t e m III a n d i n v i t e d c o m m e n t f r o m m e m b e r s .
The ensuing
j^scussion d i s c l o s e d t h a t t h e m e m b e r s of t h e C o u n c i l a n t i c i p a t e a m o d e r a t e
■-crease i n l o a n d e m a n d d u r i n g t h e n e x t s e v e r a l m o n t h s .
A n i n c r e a s e i n the
Arable g o o d s s e c t o r is l i k e l y i f s t e e l u s e r s a d d to t h e i r i n v e n t o r i e s b e ­
muse of the p o s s i b l e r e o p e n i n g o f t h e s t e e l l a b o r c o n t r a c t *
The m e m b e r s
o f t h e C o u n c i l b e l i e v e t h a t t h e l i q u i d i t y of the b a n k i n g
--stem is a d e q u a t e t o a c c o m m o d a t e t h e p r e s e n t a n d f o r e s e e a b l e v o l u m e of
:*edit d e m a n d s .
S e v e r a l m e m b e r s o b s e r v e d , however, that a vigorous e x ­
pansion in t h e e c o n o m y c o u l d q u i c k l y t i g h t e n b a n k c r e d i t .
ITEM IV
HOES T H E .CLQUNCIL l D E T E C T A H Y $ 1 * M P T 0 M S OP D E T E R I O R A T I O N I N L E N D I N G
S T1A—N DARDS, P~fl~RTTHT J L A R L Y —T N— .................1
T H E “ frTELD
O F ■ R E A L E S T A T* .............
E .C .............■■■■■■
R E D I■—T ?- ... — . - ■■ - ■■■
y ...................... ............
.Murphy r e a d I t e m I V .
T h e C o u n c i l c o n c l u d e d t h a t t h e r e w a s some
deterioration i n l e n d i n g s t a n d a r d s , p a r t i c u l a r l y i n t h e f i e l d o f r e a l
estate c r e d i t .
S e v e r a l m e m b e r s r e p o r t e d p r e s s u r e o n t h e p a r t of
borrowers f o r l o n g e r m a t u r i t i e s o f t e r m l o a n s .
Despite these develop­
ments, h o w e v e r , t h e C o u n c i l b e l i e v e s t h a t l e n d i n g s t a n d a r d s g e n e r a l l y are
consistent w i t h s o u n d b a n k i n g p r a c t i c e s *
ITEM V
'a) T H E B O A R D W O U L D A P P R E C I A T E .COMMENTS W I T H R E S P E C T TO D E V E L O P M E N T S
::: t h e a r e a o f t i m e a n d s a v i n g s d e p o s i t s , i n c l u d i n g t h e t r e n d o p s u c h
:e p o s i t s _, t h e c o s _t b u r d e n o e h i g h e r i n t e r e s t r a t e l e v e l s , a n d w h e t h e r
THE U S E S M A D E BY. BANKS.. Q E F U N D S R E P R E S E N T E D B Y S U C H D E P O S I T S H A V E
BEEN C O N S I S T E N T W I T H A C C E P T E D . S T A N D A R D S O F B A N K L I Q U I D I T Y A N D A S S E T
-7A L T T Y .
(b)
D O E S T H E C O U N C I L BELIEVE. THAT C O M P E T I T I V E AB U S E S ARE
L I K E L Y TO A R I S E F R O M THE. R A P I D L Y . E X P A N D I N G U S E O F N E G O T I A B L E C O R P O R A T E
CERTIFICATES, O E D E P O S I T O R T H A T U N S O U N D B A N K I N G C O N D I T I O N S M I G H T A R I S E
PROM W I D E S P R E A D R E L I A N C E O N D E P O S I T S Q E T H I S T Y P E ?
H OW W OULD THE
OOTHCIL R E G A R D A N I N C R E A S E T O 3 - 1 / 2 P E R C E N T I N T H E M A X I M U M P E R M I S S I B L E
INTEREST.. R A T E P A Y A B L E U N D E R R E G U L A T I O N Q O N T I M E D E P O S I T S H A V I N G A
g M l B I T Y O E L E S S T H A N S I X M O N T H S ? ___________________________________________________
M u r p h y r e a d I t e m V*
I n t h e d i s c u s s i o n w h i c h f o l l o w e d , the m e m b e r s
■"he C o u n c i l a g r e e d t h a t w h i l e t i m e a n d s a v i n g s d e p o s i t s c o n t i n u e to
'Vana, the r a t e o f i n c r e a s e h a s s l o w e d c o n s i d e r a b l y a n d t h a t it is s u b _^ n t i a l l y l e s s t h a n i t w a s a y e a r a g o .
M o s t m e m b e r s b e l i e v e t h a t the
p e e z e o n b a n k p r o f i t s c u r r e n t l y is l e s s t h a n it w a s a y e a r a g o b e c a u s e
the s h i f t s i n t h e d i s t r i b u t i o n o f b a n k a s s e t s t h a t w e r e e f f e c t e d l ast
In t h e s e c i r c u m s t a n c e s , t h e p r e s s u r e to e x t e n d m a t u r i t i e s a n d to b u y
--per y i e l d i n g a s s e t s h a s l e s s e n e d s o m e w h a t .
W h i l e the members acknowthe l i b e r a l i z a t i o n i n c r e d i t s t a n d a r d s , th<^re w a s f a i r l y w i d e
jjfj^ement t h a t t h e l e n d i n g a n d i n v e s t m e n t p o l i c i e s h a v e b e e n c o n s i s t e n t
^ accepted s t a n d a r d s of b a n k l i q u i d i t y and asset quality*



The C o u n c i l d o e s n o t b e l i e v e t h a t s i g n i f i c a n t c o m p e t i t i v e a b u s e s
iiave a r i s e n f r o m t h e r a p i d l y e x p a n d i n g u s e of n e g o t i a b l e c o r p o r a t e
’
ertificates o f d e p o s i t o r t h a t u n s o u n d b a n k i n g c o n d i t i o n s h a v e a r i s e n
the w i d e s p r e a d r e l i a n c e o n d e p o s i t s of thi s t y p e .
A n u m b e r of m e m ters o b s e r v e d , h o w e v e r , t h a t a c o n t i n u i n g e x p a n s i o n of the u s e of t h e s e
Certificates o f d e p o s i t , w o u l d t e n d to l e s s e n t h e l i q u i d i t y of the b a n k i n g
system b e c a u s e o f t h e p r e s s u r e t o u s e t h e s e f u n d s p r o f i t a b l y .
In the d i s c u s s i o n o n t h e p o s s i b l e i n c r e a s e to 3 - 1 / 2 p e r c e n t i n the
maximum p e r m i s s i b l e r a t e
p a y a b l e u n d e r R e g u l a t i o n Q. o n t i m e d e p o s i t s
having a m a t u r i t y o f l e s s t h a n s i x m o n t h s , it w a s o b s e r v e d t h a t b a n k e r s
generally w o u l d n o t f a v o r a n i n c r e a s e ,
A n u m b e r of m e m b e r s of the
jouncil a d d e d t h a t t h e y p e r s o n a l l y w o u l d f a v o r g r e a t e r f l e x i b i l i t y i n t h e
rates w h i c h b a n k s m a y p a y .
I T E M VI
HAS THE. C0UNC.IL. N O T E D A N Y T E N D E N C Y T O W A R D H E I G H T E N E D C O N C E R N ON T H E
PART 0 E T HE. B U S I N E S S A N D FINANCIAL.. C O M M U N I T Y W I T H R E S P E C T TO U. S.
B A L ANCE O F P A Y M E N T S D E V E L O P M E N T S ?
A R E THE. D I F F I C U L T N E G O T I A T I O N S
GOING. O N W I T H I N T H E E U R O P E A N E C O N O M I C C O M M U N I T Y A F A C T O R T O B E T A K E N
INTO A C C O U N T A N D A S U B J E C T O F C O N C E R N T O B A N K C U S T O M E R S ?
Murphy r e a d I t e m VI,
T h e m e m b e r s r e p o r t e d i n c r e a s i n g c o n c e r n o n the
part of the b u s i n e s s a n d f i n a n c i a l c o m m u n i t y w i t h r e s p e c t to t h e U. S 0
balance of p a y m e n t s .
T h i s Is p a r t i c u l a r l y t r u e o f c u s t o m e r s w i t h i n t e r ­
national i n v e s t m e n t a n d / o r t r a d e i n t e r e s t s .
The difficult negotiations
going on w i t h i n t h e E u r o p e a n E c o n o m i c C o m m u n i t y a l s o a r e b e i n g c l o s e l y
followed,
ITEM VII
THE B O A R D W O U L D A P P R E C I A T E T H E C O U N C I L TS C O M M E N T S O N E F F E C T S O B S E R V E D
THUS F A R F R O M T H E D E P R E C I A T I O N A N D T A X C R E D I T P R O V I S I O N S A D O P T E D IN
1962

,

____________

Murphy r e a d I t e m VII.
W i t h t h e e x c e p t i o n of c e r t a i n i n d u s t r i e s P
of which r a i l r o a d s a r e a n o u t s t a n d i n g e x a m p l e * t h e m e m b e r s of t h e C o u n c i l
W e o b s e r v e d f e w e f f e c t s t h a t t h e y w o u l d a t t r i b u t e to t h e d e p r e c i a t i o n
snd tax c r e d i t p r o v i s i o n s a d o p t e d i n 1 9 6 2 .
ITEM VIII
>/HAT A R E T H E C O U N C I L S V I E W S R E G A R D I N G T H E I M P A C T O F M O N E T A R Y A N D
CREDIT. P O L I C Y U N D E R C U R R E N T C O N D I T I O N S ?
______
Murphy r e a d I t e m V T T T a n d a d d e d that the C o u n c i l * s c u stomary reply
this q u e s t i o n w a s p r o b a b l y a p p r o p r i a t e .
T h i s w a s a g r e e d w i t h the
2uS g e s t i o n t h a t t h e C o u n c i l a l s o s h o u l d n o t e t h a t t h e p o l i c y h a s b e e n a
i n s t r u c t i v e f a c t o r i n t h e d o m e s t i c e c o n o m y a n d at t h e s a m e t i m e h a s
Je®n h e l p f u l to t h e b a l a n c e o f p a y m e n t s .




There w a s a b r i e f d i s c u s s i o n of t h e B o a r d ’s p r o p o s e d r e v i s i o n of
,,tulation M, c o p i e s o f w h i c h h a d b e e n p r e v i o u s l y f o r w a r d e d to the
'fibers of t h e C o u n c i l .
T h e C o u n c i l d e c i d e d to i n d i c a t e its a p p r o v a l
r e v i s i o n o f t h e R e g u l a t i o n w i t h t h e s u g g e s t i o n t h a t the c o m m e n t s
^ r t a i n n a t i o n a l b a n k s w i t h b r a n c h e s a b r o a d s h o u l d b e c a r e f u l l y con-*
;;^red b e f o r e t h e r e v i s i o n is f i n a l l y p u b l i s h e d .

The m e e t i n g

adjourned

at 1 2 : 3 5 P . M .

/%

/v

/v

4\

4\

/v’

"/v*

"/C

sr
- /C

THE C O U N C I L C O N V E N E D I N T H E B O A R D R O O M OP T H E F E D E R A L RESERVE
B U I L D I N G , W A S H I N G T O N , D . C. , A T 2 : 3 0 P . M . ON F E B R U A R Y 1 8 , 1963 *
Members of t h e B o a r d * s D i v i s i o n of R e s e a r c h and S t a t i s t i c s partici
rated in a n a u d i o - v i s u a l p r e s e n t a t i o n o n t h e c u r r e n t e c o n o m i c s i t u a t i o n
Copies o f t h e p r e s e n t a t i o n a r e t o b e m a d e
of the C o u n c i l b y t h e B o a r d ’s s t a f f .

a v a i l a b l e to t h e m e m b e r s

THE. C O U N C I L R E C O N V E N E D A T 9:l]-0 P . M . O N F E B R U A R Y l 8 , 1 9 6 3 * IN
R O O M 9 3 2 O F T H E M A Y F L O W E R HOTEL..
A L L M E M B E R S OF THE COUNCIL
WERE PRESENT.
The C o u n c i l p r e p a r e d a n d a p p r o v e d t h e a t t a c h e d C o n f i d e n t i a l M e m o r ­
andum to b e s e n t t o t h e B o a r d o f G o v e r n o r s r e l a t i v e to the A g e n d a f o r
‘
-"e joint m e e t i n g o f t h e C o u n c i l a n d t h e B o a r d o n F e b r u a r y 19, 1 9 6 3 o
:~e M e m o r a n d u m w a s d e l i v e r e d t o t h e F e d e r a l R e s e r v e B u i l d i n g at
—
P.M. o n F e b r u a r y 1 8 .

The m e e t i n g a d j o u r n e d at 1 0 : ^ 0 P . M *




CONFIDENTIAL
MEMORANDUM TO THE BOARD OF GOVERNORS
FROM THE
FEDERAL ADVISORY COUNCIL
RELATIVE TO THE AGENDA FOR THE JOINT MEETING
ON FEBRUARY 19, 1963

1.

What are the o b s e rv a tio n s o f the C ouncil regarding (a) r e ­
cent do m estic economic developm ents, and (b) the business
o u tlo o k fo r the f i r s t h a l f o f 1963 and the year as a
whole?
(c ) Do the members o f the C ouncil b e lie v e th a t the
improvements i n b u sin e ss psychology reported a t the
November m ee ting w ith the Board has strengthened fu rth e r
sin ce t h a t tim e , remained about the same, or receded?

a)
Recent do m estic economic developments in d ic a te a co n tin u a ­
tion of the mixed tre n d s t h a t have p r e v a ile d the p ast several months.
W hile the spending b e h a v io r o f consumers, as evidenced by r e t a i l sales
and in p a r t i c u la r by the volume o f new model autom obiles s o l d , has been
encouraging, the d e c lin e in new orders fo r durable g o o d s , the f a ilu r e of
in d u s tr ia l p r o d u c tio n to r i s e , and the u n c e r ta in ty created by the Budget
Message, to g e th e r w ith the d is c u s s io n o f a p o s s ib le tax c u t, have clouded
the immediate o u tlo o k .
b)
D e s p ite these im p ond erables, however, the C ouncil a n tic ip a te s
that business i n the f i r s t h a l f o f 1963 w i l l co ntinue to show the moderate
improvement t h a t c h a r a c te r iz e d the l a s t s ix months o f 1962. The outlook
for the la s t h a l f o f 1963 is le s s c e r t a in .
c) The C o u n c il b e lie v e s th a t the improvement in business
psychology re p o rte d a t the November m eeting has receded somewhat since
that tim e.
Developments i n E u ro p e5 Canada and Cuba, together w ith the
problems a s s o c ia te d w ith the b a la n c e o f payments, budget d e f ic i t s , and
e sp ecially the proposed ta x l e g i s l a t i o n , have lessened the favorable
sentiment in the b u s in e s s community.
2.

In the o p in io n o f the C o u n c il, what fa c to r s in the c u r­
r e n t economic p ic t u r e suggest the most s tre n g th or
encouragement?
C o n v e rse ly , what fa c to r s appear to be o f
g r e a te s t co n c e rn 7

In the o p in io n o f the C o u n c il, the p e r s is te n t stre n g th o f con­
sumer buying is a m ajo r source o f encouragement in the c u rre n t economic
p ictu re . T his f a c t o r and the absence o f growth in in v e n to r ie s suggest
that new orders and p r o d u c tio n w i l l p ro b ab ly r i s e , r e s u lt in g in some
improvement in employment, income, and o v e r - a ll economic a c t i v i t y . A
build-up o f in v e n t o r ie s by s t e e l use rs in a n t i c ip a t i o n o f a s tr ik e could
also c o n tr ib u te to a r i s e in b u sin e ss in the months im m ediately ahead.
Excess p r o d u c tiv e c a p a c it y , the la c k o f v ig o r in c a p it a l expendi­
tures, the r e l a t i v e l y h ig h le v e l o f unemployment, and recent developments




in labor n e g o t i a t i o n s , such as the newspaper strikes and the departure
from the g u i d e l i n e s in the doc k strike settlement, are currently matters
of economic concern.
3.

What are the p ro sp ects fo r lo an demand a t banks du ring
the next se v e ra l months,
in c lu d in g demand in v arious
lo an c a te g o rie s ?
Is the l i q u i d i t y o f the banking
system co n sid e re d ample to accommodate the present and
fo re se e a b le volume o f c r e d it demands?

The members o f the C o u n c il a n t ic ip a t e a moderate increase in
loan demand d u r in g the next se v e ral months.
Some increase in loans is
lik e ly to occur in the d u ra b le goods s e c to r, e s p e c ia lly i f ste e l users
add to t h e ir in v e n to r ie s because o f the p o s s ib le reopening o f the ste e l
labor c o n tr a c t.
The members o f the C oun cil b e lie v e th a t the l i q u i d i t y
of the banking system i s adequate to accommodate the present and fo re ­
seeable volume o f c r e d i t demands.
4.

Does the C o u n c il d e te c t any symptoms o f d e te r io r a tio n
in le n d in g s ta n d a r d s , p a r t i c u l a r l y in the f i e ld o f
r e a l e s ta te c r e d it?

The C o u n c il has observed some d e t e r io r a t io n in le n d in g standards,
p a r t ic u la r ly in the f i e l d o f r e a l e s ta te c r e d it . There has a ls o been some
pressure to le n g th e n the m a t u r it ie s o f term lo a n s . However, le n d in g
standards g e n e r a lly are c o n s is t e n t w ith sound banking p r a c tic e s .
5.

(a ) The Board w ould a p p r e c ia te comments w ith respect
to developm ents i n the area o f time and savings
d e p o s it s , in c lu d in g the tre nd o f such d e p o s its , the
c o s t burden o f h ig h e r in t e r e s t ra te le v e ls , and
w hether the uses made by banks o f funds represented
by such d e p o s its have been c o n s is te n t w ith accepted
stan d a rd s o f bank l i q u i d i t y and asse t q u a lit y .
(b)
Does the C o u n c il b e lie v e th a t c o m p e titiv e abuses
are l i k e l y to a r is e from the r a p id ly expanding use o f
n e g o tia b le c o rp o ra te c e r t i f i c a t e s o f d e p o s it or th a t
unsound b a n k in g c o n d it io n s m ight a r is e from widespread
r e lia n c e on d e p o s its o f t h is type? How would the
C o u n c il re g a rd an in c re a s e to 3-1/2 per cent in the
maximum p e r m is s ib le in t e r e s t r a te payable under
R e g u la tio n Q on tim e d e p o s its h av in g a m a tu r ity o f
le s s th an s ix months?

a)
A lth o u g h tim e and sav ings d e p o s its co n tin ue to expand, the
r a t e o f in c re a se has slowed c o n s id e r a b ly a n d is s u b s t a n t ia lly le ss
than
i t was a year ago.
F u rth e rm o re , because o f s h i f t s in the d is t r ib u t io n of
bank assets t h a t were e ffe c te d l a s t y e ar, the squeeze on bank p r o f it s
cu rre ntly is le s s th an i t was a year ago. A c c o rd in g ly , the pressure to
e x te nd m a t u r it ie s and to buy h ig h e r y ie ld in g asse ts has lessened somewhat.




-3As the Council has observed, there has been some liberalization in credit
standards, but in general, the lending and investment policies ha~/e been
consistent w i t h a c c e p t e d standards of bank liquidity and asset quality.
b)
The C o u n c il does not b e lie v e th a t s ig n if ic a n t com petitive
abuses have a r is e n from the r a p id ly expanding use o f n e g o tia b le corporate
c e r t if ic a t e s o f d e p o s it or th a t unsound banking c o n d itio n s have a ris e n
from w idespread r e lia n c e on d e p o s its o f t h is type. However, the growth
of n e g o tia b le c o rp o ra te c e r t i f i c a t e s o f d e p o s it has re s u lte d in
im portant s h i f t s in the types o f bank a s s e ts . A c o n tin u in g expansion in
the use o f these c e r t i f i c a t e s o f d e p o s it w i l l tend to lessen the l i q u i d i t y
of the banking system because o f the pressure to use these funds
p r o f it a b ly .
The C o u n c il b e lie v e s th a t bankers g e n e ra lly would not presently
favor an in c re a se to 3-1/2 per cent in the maximum p e rm issib le in te r e s t
rate p o s s ib le under R e g u la tio n Q on time d e p o sits having a m a tu rity of
less than s ix m onths.
6.

Has the C o u n c il noted any tendency toward heightened con­
cern on the p a r t o f the business and f in a n c ia l community
w ith re s p e c t to U. S. balance o f payments developments?
Are the d i f f i c u l t n e g o tia tio n s going on w ith in the
European Economic Community a fa c to r to be taken in to
ac co un t and a s u b je c t o f concern to bank customers.

The C o u n c il has n o tic e d in c r e a s in g concern on the p a r t o f the
business and f i n a n c i a l community w ith respect to the U. S. balance o f
payments.
Customers who have in t e r n a t io n a l investm ent and/or trade
in te r e s ts are p a r t i c u l a r l y concerned no t only w ith balance o f payments
developments, b u t a ls o w ith the d i f f i c u l t n e g o tia tio n s going on w ith in
the European Economic Community.
7.

The Board would a p p r e c ia te the C o u n c il’ s comments on
e f f e c t s observed thus fa r from the d e p r e c ia tio n and tax
c r e d it p r o v is io n s adopted in 1962,

W ith the e x c e p tio n o f c e r t a in in d u s t r ie s , the C ouncil has
observed few e f f e c t s t h a t i t would a t t r i b u t e to the d e p r e c ia tio n and tax
c r e d it p r o v is io n s adopted in 1962.
8.

What are the C o u n c il's views re g a rd in g the impact o f
m onetary and c r e d it p o lic y under c u rre n t c o n d itio n s ?

The C o u n c il b e lie v e s th a t c u rre n t monetary and c r e d it p o lic y
has had a g e n e r a lly fa v o ra b le im pact on the economy. This p o lic y has been
a c o n s tr u c tiv e f a c t o r i n the dom estic economy and a t the same time has
been h e lp f u l to the b a la n c e o f payments.

★

vt

The C o u n c il fa v o rs the r e v is io n o f R e g u la tio n M intended to carry
out the purposes o f P. L. 87-588, "To improve the u se fu ln e ss o f n a tio n a l
bank branches in fo r e ig n c o u n t r ie s ."
In c o n s id e rin g the B oard's proposed
r e v is io n , members o f the C o u n c il have reviewed the comments o f c e r ta in
n a tio n a l banks w ith branches ab ro a d . The C o un cil b e lie v e s th a t th e ir sug­
gestions m e r it c o n s id e r a tio n by the Board.



6

ON F E B R U A R Y 1 9 , 1 9 6 3 , A T 1 0 : 3 0 A . M . , T H E F E D E R A L A D V I S O R Y C O U N C I L
H E L D A J O I N T M E E T I N G W I T H T H E B O A R D O P G O V E R N O R S OP T H E F E D E R A L
R E S E R V E S Y S T E M I N T H E F E D E R A L R E S E R V E B U I L D I N G , W A S H I N G T O N , D.C.
ALL M E M B E R S OP T H E C O U N C I L W E R E PRESENT.
THE F O L L O W I N G M E M B E R S OP T H E B O A R D OP G O V E R N O R S W E R E PRESENT:
CHAIRMAN MARTIN, V I C E CHAIRMAN BALDERSTON, GOVERNORS ROBERTSON
AND SHEPAR D S O N .
M R . S H E R M A N , S E C R E T A R Y , AND. M R . K E N Y O N , A S S I S T A N T
SECRETARY, OP T H E B O A R D OF G O V E R N O R S A LSO W E R E P R E S E N T 0
The m i n u t e s o f t h e j o i n t m e e t i n g a r e b e i n g p r e p a r e d i n t h e o f f i c e
0f the S e c r e t a r y o f t h e B o a r d of G o v e r n o r s of t h e F e d e r a l R e s e r v e S y s t e m *
fheir c o n t e n t w i l l b e c o m p a r e d w i t h t h e n o t e s of t h e S e c r e t a r y of the
Council* A s s u m i n g t h e y a r e i n s u b s t a n t i a l a g r e e m e n t * t h e y w i l l be r e ­
produced a n d d i s t r i b u t e d to t h e m e m b e r s of t h e C o u n c i l *
The m e e t i n g

a d j o u r n e d at 1 : 0 0 P « M „

The n e x t m e e t i n g of t h e C o u n c i l w i l l b e h e l d o n M a y 20 *=*21, 1963