Full text of Press Releases of the United States Department of the Treasury : Volume 113

View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

i^L—lrc#%<AH£:Jb^pj%

LIBRARY
PWM 5030

JUN 141972
TREASURY DEPARTMENT

I
RELEASE A. VS. MEWSFAFBRS,
Tw.»d«y, April 1, lffd.

'/^mm^mmmjj <A_

Tfea Treagury BepartMitt a a m u a a d last evening that tha tanHera tor

$l97m9m090Q0

or tbaraabouti, of nnflajr tvaaaavx bills to ba datad April 1 aad to mmtnrm m>y 3* lff§;
whieh Mere offered on mrok f?, M M opomi at the Federal flMam Bank® on March » .
Tb* detail® #£ ihla 1 M M ar» m

JallaMt

Total applied tor - |t # IOb«m»<K>0
total Maapta*
- l f 7QM9T»0QQ (tMlwiM M63»9SS#IXX» asland mm a
mmmpmtltlm
bm$* and *mmm*t*M in
ftU ®t iha « M » f a priaa shown bel©»}
tanga of accepted ecespttitiira bid©;
ifi#

Low

- 99*72$ U*iimlant rata of dUMowst appraat. 3 . « 0 M % per anissai
«
. «
»
«
m. f f ^ t W ©
•
1,203* "
•

Average

** ft.110

•

l.lM*' •

(1 percent #f tfe® amaanfc b0 Iter at the low prim* wan accepted)

totmx

federal teaerve
Biatrisst

fatal.
4cee|?t©d

Applied tow

Boston

1
31*537*000
l,ft8,666,Q0O
tt§,605,OO0
$Stf7ft3f00O
13,^15,000

^e*» iwr**

Philadelphia
Cleveland
Atlanta
Chieago
St. hmtm
MiiMMpeli*
ICaisaa® City
Bellas
San Trmmimo

ftfWa9ooo

13,f?S,O®0
27»72b9Q0Q
2Q$9SOI9QOQ
29971990Q0

a?,ftii,ooo
2i(Sf5&,ooo
t« f n9 9 ooo
Uifsoi»ooo
55?,727,TO
T0TA1

a 9 5*7,ooo

X,0Ml t 2M f 000
e*9<0*f000

i^,5ci,ooo
Sa9?2?,0OO
26992ii9€00

S699?2f*O0O
11®»173,00O

—»>AT3f0qD

&,2Qa 9 797 9 QO0

& 9 7OO 9 297 9 O0O

fc^er*
/y

\KA

/f<r^^

/./3<p

TREASURY DEPARTMENT
WASHINGTON, D.C.
tELEASE A. M. NEWSPAPERS,
hxesday, April 1, 1958.

A-202

The Treasury Department announced last evening that the tenders for #1,700,000,00

>r thereabouts, of 91-day Treasury bills to be dated April 3 and to mature July 3

rhich were offered on March 27, were opened at the Federal Reserve Banks on March
The details of this issue are as follows;
Total applied for - $2,201*, 797,000
Total accepted
- 1,700,297,000

(includes $263,955,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bids?
High
Low

- 99.725 Equivalent rate of discount approx. 1.088# per annum
-99.696
«
w
11
w
u
1^203$ «
m

Average

- 99.710

1.1W*

(1 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

I
21,537,000
l,09l*,l68,000
1*8,605,000
51*, 7^3,000
13,975,000
27,72l*,000
205,501,000
29,719,000

31,537,000
1,51*8,668,000
1*8,605,000
51i,7l*3,000
13,975,000
27,72l*,000

21*5,501,000
29,719,000
il*,5oi,ooo

TOTAL

il*,5oi,ooo
52,727,000

52,727,000
26,92l*,000
110,173,000

26,92l*,000
110,173,000

$2,20^,797,000

$1,700,297,000

A -a o
RELEASE A.M. OTSPAPEESo
Tuesday, April 1, 1958 ^

^
^

. ... . - „ .
-Ifereh-^-^^lf

"BRAFT PRESS RELEASEUndersecretary of the Treasury Julian B. Baird and Ambassador
Mariano Puga of Chile teday signed a one-year extension of an exchange agreement between the Treasury and Chile.
V\as
The International Monetary Fund also announced renewal of its
stand-by agreement with Chile, and the Treasury is informed that o_
Tgf&mVpnsk private laerican banks have renewed their outstanding credit
lines with that country. The Treasury exchange agreement supplements
these other arrangements.
Chile is continuing its efforts to achieve economic stability
and freedom in its trade and exchange system. Under the exchange
agreement, Chile may request the United States Exchange Stabilization fund to purchase Chilean pesos up t© an amount of $10 million,
should the occasion for such purchases arise. Any pesos acquired
by the Treasury would subsequently be repurchased by Chile for
dollars.

•7

•7717

•

d ^

m*-^
TUtL

TREASURY DEPARTMENT
WASHINGTON, D.C.
RELEASE A.M. NEWSPAPERS,
Tuesday, April 1, 1958.

A-203

Under Secretary of the Treasury Julian B. Baird
and Ambassador Mariano Puga of Chile have signed
a one-year extension of an exchange agreement between
the Treasury and Chile.
The International Monetary Fund has also
announced renewal of its stand-by agreement with
Chile, and the Treasury is informed that a group of
private American banks have renewed their outstanding
credit lines with that country.

The Treasury

exchange agreement supplements these other arrangements.
Chile is continuing its efforts to achieve
economic stability and freedom in its trade and
exchange system.

Under the exchange agreement, Chile

may request the United States Exchange Stabilization
Fund to purchase Chilean pesos up to an amount of
$10 million, should the occasion for such purchases
arise.

Any pesos acquired by the Treasury would

subsequently be repurchased by Chile for dollars.

oOo

- 14 We have become a great exporting nation in capital goods.
The continuation and growth of this industry is directly
related to the availability of development financing.
To return to the keynote topic of this meeting
"Todays Challenge in Trade and Aid" there is no doubt
that the economic growth of the free world offers a great
and exciting challenge. We in the United States have been
working hard to meet it for the last decade and are
constantly evolving new techniques and approaches to
improve upon our effectiveness. Our country has accepted
the challenge and we will meet it.

- 13 No large country has ever been able, to the best of my
knowledge, to obtain more than a rather small fraction of
its financing requirements from foreign savers. There is
not enough to spare in any one country to meet the capital
needs of the world. A very large part of the expenditures
required for development are for labor and supplies that are
produced within the country using them.

One of the major

needs in all less-developed countries will be to continue to
develop their internal financial systems and to create
conditions of financial stability which will bring forth
more savings for local investment. While we can provide
assistance and some of the impetus. the final responsibility
rests with the countries concerned.

Results will depend in

a large measure on their desire and ability to conduct their
affairs on a sound basis.
The second closing point applies to us. The use of our
savings by foreign countries is not just a one-way street.
We benefit also in no small measure because a very large part
of these funds which we make available are spent on U, S.
exports, either on agricultural commodities or on capital goods.
The several billion dollars a year in public and private savings
which will be used for financing economic development in this
current year will represent a very significant factor in sustainin
income and employment in agriculture and industry in the
United States.

7
i

- 12 While these grants can also provide for some development
financing, they have been largely utilized in recent
years to meet some of the economic impact of large
military establishments that are being maintained by many
of the free world countries in the interest of the common
defense.
I should, however, say a few words about my fourth
point, sale of surplus agricultural commodities under what
is usually called the Public Law 480 program.

Since its

inception in 1955 agreements amounting to about $2.6 billion
have been reached with foreign countries for the sale of
agricultural commodities. The statute provides a number
of uses which may be made of the resulting local currencies*
More than half of them are being devoted to loans, broadly
similar in terms of repayment to those which we are now using
in the Development Loan Fund.

The program does not provide

capital goods from abroad but does result in a fund of local
^gwvi-rtg4 which can be used to further development.
Now I would like to draw your attention to two very
important considerations that are common to all four types
of financing arrangements I have mentioned.

The first applies

to the less-developed countries. They must rely on local
savings for the major part of their requirements.

- 11 -

The Congress of the United States has recognized this need
by establishing the Development Loan Fund, which will lend
for projects that may be quite significant in terms of
country needs but cannot be financed by the other institutions.
A large portion of the Development Loan Fund loans will be
repaid in the currency of the borrowing country —

not in

foreign exchange. In this way, help can be given to countries
whose immediate economic prospects are not as favorable as
others. The Development Loan Fund is making loans which we
frankly recognize are "soft" loans. The terms of repayment
will impose a light burden on the economies of the countries.
They represent a contribution which we are making toward
development projects that could not otherwise be financed.
The DLF has been in operation only a few weeks and has already
committed in excess of $100,000,000 in loans of the type just
mentioned to under-developed countries. The Fund is currently
operating with a capital of $300,000,000 appropriated by
Congress for Fiscal Year 1958. It is hoped that the Congress
will include $625,000,000 additional in the budget for
Fiscal Year 1959.
In this discussion, I have not tried to cover the grants
of economic assistance which we have made and which we will
continue to make in some areas.

- 10 With the funds provided by both banks the Indian program
can go forward in the acquisition of capital goods from
/
/

7£^57aoT/ail

/2mt,rsaid ^/^

abroad to be financed over dr i>&£te&z&&=^^

jf * " "'*z*i*

India will have the, use of savings which have been mobilized
by a U*-S". Government institution and by an international
institution, and this substantially relieves the current
strain on their foreign exchange earnings and resources.
I should now like to turn to loans repayable in local
currencies which constitute the third of my four classifications
of international operations. This is the newest technique.
It is particularly designed to meet the special problem of
accelerating development in areas and in types of investment
that are beyond the margin that can attract financing from
private investment or from the lending agencies which make

case of the International Bank, to some extent, in other
relatively hard currencies. The less-developed countries,
however, are not always in a position to service such loans.
They need projects, such as waterworks, highways, irrigation
and drainage projects, that will eventually do much to improve
their economic conditions,but which do not immediately yield
or save foreign exchange to enable them to pay off hard currency
loans.

_ 9 —

--*-w

The United States Government also took the lead in the
establishment of the World B a n k / g ^ ^ ^ f c & has subscribed
/TS
about one-third of ^*re capital. The activities of the two
banks have supplemented each other to an Important degree.
The World Bank, as an international organization, finances
projects in any of its member countries, and suppliers in
any of its member countries can bid on the contracts. The
Export-Import Bank, on the other hand, lends only for
exports from the United States. Since 1934, the Export-Import
Bank has made loans of more than $7-1/2 billion, most of
which have been important in economic development overseas.
It now has $3 billion of loans outstanding.

The World Bank,

since 1946, has loaned a total of $3.4 billion, and now
jt *** a
has outstanding about $%%^fl billion In loans.
India is a good example of a country with a large
development program which has benefited from the operations
of these two banks. Recently, the Export-Import Bank has
authorized a loan of $150 million to India to provide U. S.
goods needed in Irrigation and reclamation, power, mining,
transport, and industry. The World Bank has TTrrrfe^^

,q,f

more than $100 million for the expansion of a large steel
enterprise in India with a guarantee of the Indian Government.
In previous years it has also extended loans for steel plants,
for the construction of power facilities, the clearing of
land, and for the improvement of the railway system.

—

"** -i.

The recent discussions engendered by the President's
proposal to Congress for extension of the Reciprocal
Trade Agreements Act have again focused attention on
the vital necessity of beneficial trade among the nations
of the world.

International trade stimulates increasing

private investment abroad, giving powerful assistance to
the development of the economies of our friends while
at the same time being beneficial to the American businessman,
farmer and worker. The Reciprocal Trade Agreements Act
must be extended if our trade and investment are to
continue to increase and prosper.
Second in my tabulation of the four types of financing
efforts, and second also in historical evolution, are the
so-called bankable or hard currency loans made by lending
agencies.
As World War II was drawing to a close, the United
States Government realized that there would be a great
demand for financing economic development abroad in the
period of peace which we hoped would follow. To this end,
the Congress expanded the lending activities of the Export-Import
Bank of Washington, the United States Government foreign
lending agency which had been created to assist in financing
exports from this country.

- 7-

For example, we have recently estimated that in Latin
America in 1955 the operations of/American-owned private
enterprises employed about 625,000 people. They paid over
$1 billion to Latin American governments in various forms
of taxation. The operations of these companies provided
very large amounts of precious foreign exchange to the
Latin American countries, amounting to nearly $1 billion.
Much of this foreign exchange was available to the
countries to purchase economic development Imports.
I do not need to emphasize the advantages of private
investments. Technical and managerial skill of an advanced
type generally accompanies direct investment abroad.

Private

investment, of course, moves to countries where there is
a congenial climate, where the investor feels that his
investment is safe and where financial conditions permit
him to remit his earnings ancyrefpatriate his capital. There
is also some tendency for the private investor to move to
familiar places, and those with which he and his associates
have important trade relations.
While I am concentrating my remarks chiefly on investment,
we must not forget the other part of your topic —
International trade.

13
-6Third:

Loans repayable In local currencies, such
as those extended by the new Development
Loan Fund.

Fourth:

Agricultural sales against local currencies,
such as those made by the Commodity Credit
Corporation under Public Law 480.

Each program has its uses and each is making its contribution
both to recipient countries and to our own economy.

Taken

together they provide much of the light of hope which is
reaching the great populations of the free world.
If we look simply at aggregate dollar figures, the
annual flow of private capital into foreign investment is
larger than the total of the other three types that I have
mentioned. For example, we estimate that/U^ST investors
added to the value of their investments abroad about $4
billion in 1957 and about $13.5 billion in the five years
just passed. The value of private investments abroad
reached a total estimated at roughly $37 billion at the end
of last year, and it is quite likely that this amount
substantially underestimates the valuation at which these
assets might now be appraised.

T3^3S»B«Siii«# Enterprises/associated with JfcSr.^>-r^/ £?%
c o r p o r a t i o n s / ^ S i ^ ^ ^ ^ ^ ^ ^ g ) participate in the most direct
and effective way in development, production, and the employment
of labor in the^ar^ar^rssttbete they are situated.

- 5A basic way in which we can help is to lend some of
our savings. fe^o doing/we can provide a stimulus to
development and supply some of the otherwise unobtainable
capital goods that the less-developed areas need.

In so

utilizing part of our savings, we at the same time keep
our own people employed in producing goods for export.
We derive the double benefit of strengthening the ties
with the free world and sustaining our own industry.
I am always conscious that we are using our savings,
and what we use in this way is therefore not available for
other uses. We have to balance the pressing demands from
abroad with the capacity of our people to provide savings
to finance both domestic and foreign investment.
I ask that you think of four broad ways of using
savings for foreign investment:
First:

Private investments, such as those made
by the oil companies, automobile
manufacturers and hundreds of other well
known American firms as well as purchases
of foreign securities by American investors
and loans by American commercial banks.

Second: Loans repayable in dollars, extended
governmental and Inter-governmental
institutions such as the Export-Import
Bank and the World Bank.

- 4Also we have had a high level of per capita income coupled
with a very large market. Conditions are quite different
in one or more of these aspects in nearly all underdeveloped
areas. Economics is a stubborn and demanding art. It
will not let one gloss over or pass over any of these
important factors. To meet this great challenge before
us, organization, capital, hard and devoted work are all
needed.

Seldom in history has any country even under the

most favorable circumstances, been able to see a sustained
rise in its per capita income in real terms amounting to
more than a few percentage points in a given year. It
would be a mistake to encourage exaggerated expectations
that could only lead to disappointment.
On the other hand, development is essential to
great areas which have so much of the population of the
free world. Even more necessary than economic accomplishment
in itself is the symbol of hope for the future. Without
hope, life is colorless, drab, and fearful. But with the
magic ingredient of hope comes the spirit, the strength and
the will to meet difficulties and to surmount them, both as
individuals and as nations. We recognize this, and we are
placing great emphasis on helping other nations gain this
hope through visible progress in their economic development.

I k
«L y

- 3It is particularly difficult when we realize that the
only way that we can have development anywhere in the world,
at home or abroad, is to save something out of someone's
current income and use these savings to invest in capital
goods that will increase production in the future. We
may not always remember this but it is a fact and there
are no substitutes. I use the term "savings" in the broad
sense as meaning that part of the receipts of private
citizens or private institutions or the government which
•re not spent for current consumption •

Consequently I

am going to discuss this problem of economic development
in terms of the use of savings for the best good of our
own country and the free world.
I should like to say at the outset that the challenge
we face in the free world is a very decided one, both for
ourselves and for the, countriesrof Asia9 Afrtca• and-fcartrin
AmeKfc^a. In many ways the problem of directing savings
effectively In these areas Is proving more serious and
more difficult than under the very favorable circumstances
which have existed in the United States. Here we have had
enormous natural resources relative to our population, a
high degree of political stability, freedom from foreign
aggression, and a vigorous and competitive system of private
enterprise and initiative.

- 2 -

1 ?

It has acquired a new and special significance in recent
years.

There has always been economic development in the

sense of new investment of capital, new application of
technology and the whole complex and fascinating panorama
of economic growth. No country has had a more dramatic
experience with development than the United States, and no
part of our nation is more familiar with this or takes more
pride in our accomplishment than the Far West and the State
of California in particular.
Today the concept of economic development in the
less-developed areas has an additional meaning.

It implies

that there is a need for especially concentrated efforts of
government and private business to try to speed up normal
economic processes. Two world wars have caused people
throughout the free world to recognize their mutual
dependence both economically and politically.

The inhabitants

of the less advanced countries have been comparing their
economic life with that of the more prosperous nations and
they are determined to improve their living conditions by
sharing in the benefits of modern productive methods. They
look to the more advanced countries to help in supplying
the equipment and know-how to bring this about.
How do we meet this desire and where does the money
come from?

It is not easy.

18
REMARKS BY ASSISTANT SECRETARY TOM B. COUGHRAN
AT A LUNCHEON MEETING OF THE LEAGUE OF WOMEN
VOTERS OF SAN FRANCISCO, HOTEL MARK HOPKINS,
SAN FRANCISCO, CALIFORNIA, FOR DELIVERY AT
1:00 P.M., P.S.T., THURSDAY, APRIL 3, 1958
Financing Economic Development Overseas

"Today's Challenge in Trade and Aid", the general
subject under which you have billed me, Is certainly most
timely and is commanding much attention in our country.
It Is extremely broad however and because I know my own
limitations I asked Mrs. Otsea if I could speak to you on
one very important aspect of the/ b&om&»-mm3m**mtjand she
very kindly consented.
/ W

will be "Financing Economic Development Overseas".

This is the field to which my daily duties in Washington
as well as my previous experience here in San Francisco most
directly relate. It is a part of the broad challenge which
is very close to the center of the stage and shares, if I
may say so, top place in Washington with our trade policy*
Both are inter-related and both are of vital concern to all
of us as citizens.
We have all heard a great deal about the phrase
"economic development". In government and business circles,
in international conferences, and in groups of public-spirited
citizens such as our meeting today the term is frequently
heard.

19
TREASURY DEPARTMENT
Washington
REMARKS BY ASSISTANT SECRETARY TOM B. COUGHRAN
AT A LUNCHEON MEETING OF THE LEAGUE OF WOMEN
VOTERS OF SAN FRANCISCO, HOTEL MARK HOPKINS,
SAN FRANCISCO, CALIFORNIA, FOR DELIVERY AT
1:00 P.M., P.S.T., THURSDAY, APRIL 3, 1958.
Financing Economic Development Overseas

"Today's Challenge in Trade and Aid", the general
subject under which you have billed me, is certainly most
tixaely and is commanding much attention in our country.
It is extremely broad however and because I know my own
limitations I asked Mrs. Otsea if I could speak to you on
one very important aspect of the topic and she very kindly
consented.
My subject will be "Financing Economic Development Overseas"
This is the field to which my daily duties in Washington as
well as my previous experience here in San Francisco most
directly relate. It is a part of the broad challenge which
is very close to the center of the stage and shares, if I may
say so, top place in Washington with our trade policy. Both
are Inter-related and both are of vital concern to all of us
as citizens.
We have all heard a great deal about the phrase
"economic development". In government and business circles,
in international conferences, and in groups of public-spirited
citizens such as our meeting today the term is frequently
heard. It has acquired a new and special significance in
recent years. There has always been economic development in
the sense of new Investment of capital, new application of
technology and the whole complex and fascinating panorama
of economic growth. No country has had a more dramatic
experience with development than the United States, and no
part of our nation is more familiar with this or takes more
pride in our accomplishment than the Far West and the State
of California in particular.
Today the concept of economic development in the
less-developed areas has an additional meaning. It implies
that there is a need for especially concentrated efforts of
government and private business to try to speed up normal
A-204
economic
processes. Two world wars have caused people
throughout the free world to recognize their mutual dependence

- 2-

both economically and politically. The inhabitants of the
less advanced countries have been comparing their economic
life with that of the more prosperous nations and they are
determined to improve their living conditions by sharing in
the benefits of modern productive methods. They look to the
more advanced countries to help In supplying the equipment
and know-how to bring this about.
How do we meet this desire and where does the money come
from? It is not easy. It is particularly difficult when we
realize that the only way that we can have development anywhere in the world, at home or abroad, is to save something
out of someone's current income and use these savings to
invest in capital goods that will increase production In the
future. We may not always remember this but it is a fact and
there are no substitutes. I use the term "savings" in the
broad sense as meaning that part of the receipts of private
citizens or private institutions or the government which
is not spent for current consumption. Consequently I am
going to discuss this problem of economic development in
terms of the use of savings for the best good of our own
country and the free world.
I should like to say at the outset that the challenge
we face In the free world is a very decided one, both for
ourselves and for the less developed countries. In many ways
the problem of directing savings effectively in these areas
is proving more serious and more difficult than under the
very favorable circumstances which have existed in the
United States. Here we have had enormous natural resources
relative to our population, a high degree of political
stability, freedom from foreign aggression, and a vigorous
and competitive system of private enterprise and initiative.
Also we have had a high level of per capita income coupled
with a very large market. Conditions are quite different
in one or more of these aspects in nearly all underdeveloped
areas. Economics is a stubborn and demanding art. It
will not let one gloss over or pass over any of these
Important factors. To meet this great challenge before us,
organization, capital, hard and devoted work are all needed.
Seldom In history has any country even under the most
favorable circumstances, been able to see a sustained
rise in its per capita income in real terms amounting to
more than a few percentage points in a given year. It
would be a mistake to encourage exaggerated expectations
that could only lead to disappointment.
On the other hand, development is essential to great
areas
which
have
so much
of
the
population
of
free
world.
Even
is the
colorless,
more
symbol
necessary
drab,
of hope
than
and
for
fearful.
economic
the
future.
But
accomplishment
with
Without
thethe
magic
hope,
In
itself
life
ingredient

"3 "

of hope comes the spirit, the strength and the will to meet
difficulties and to surmount them, both as individuals and
as nations. We recognize this, and we are placing great
emphasis on helping other nations gain this hope through
visible progress in their economic development.
A basJc "way in which we can help is to lend some of our
savings.
By doing this we can provide a stimulus to
development and supply some of the otherwise unobtainable
capital goods that the less-developed areas need. In so
utilizing part of our savings, we at the same time keep
our own people employed in producing goods for export. We
derive the double benefit of strengthening the ties with
the free world and sustaining our own industry.
I am always conscious that we are using our savings,
and what we use in this way is therefore not available for
other uses. We have to balance the pressing demands from
abroad with the capacity of our people to provide savings
to finance both domestic and foreign investment.
I ask that you think of four broad ways of using savings
for foreign investment:
First: Private investments, such as those made
by the oil companies, automobile
manufacturers and hundreds of other well
known American firms as well as purchases
of foreign securities by American investors
and loans by American commercial banks.
Second: Loans repayable in dollars, extended by
governmental and inter-governmental
institutions such as the Export-Import
Bank and the World Bank.
Third: Loans repayable in local currencies, such
as those extended by the new Development
Loan Fund.
Fourth: Agricultural sales against local currencies,
such as those made by the Commodity Credit
Corporation under Public Law 480.
Each program has its uses and each Is making its contribution
both to recipient countries and to our own economy. Taken
together they provide much of the light of hope which is
reaching the great populations of the free world.
If we look simply at aggregate dollar figures, the
annual flow of private capital into foreign investment is
larger than the total of the other three types that I have
mentioned. For example, we estimate that United States

22
- 4investors added to the value of their investments abroad
about $4 billion in 1957 and about $13.5 billion in the five
years just passed. The value of private investments abroad
reached a total estimated at roughly $37 billion at the end
of last year, and it is quite likely that this amount
substantially underestimates the valuation at which these
assets might now be appraised.
Enterprises abroad associated with United States
corporations participate in the most direct and effective
way in development, production, and the employment of labor
in the foreign countries where they are situated. For
example, we have recently estimated that in Latin America
in 1955 the operations of major American-owned private
enterprises employed about 625,000 people. They paid over
$1 billion to Latin American governments in various forms
of taxation. The operations of these companies provided
very large amounts of precious foreign exchange to the
Latin American countries, amounting to nearly $1 billion.
Much of this foreign exchange was available to the countries
to purchase economic development imports.
I do not need to emphasize the advantages of private
investments. Technical and managerial skill of an advanced
type generally accompanies direct investment abroad. Private
investment, of course, moves to countries where there is
a congenial climate, where the investor feels that his investment is safe and where financial conditions permit him to
remit his earnings and If he so desires, to repatriate his
capital. There is also some tendency for the private
investor to move to familiar places, and those with which he
and his associates have important trade relations.
While I am concentrating my remarks chiefly on investment,
we must not forget the other part of your topic — international
trade. The recent discussions engendered by the President's
proposal to Congress for extension of the Reciprocal Trade
Agreements Act have again focused attention on the vital
necessity of beneficial trade among the nations of the world.
International trade stimulates increasing private investment
abroad, giving powerful assistance to the development of the
economies of our friends while at the same time being
beneficial to the American businessman, farmer and worker.
The Reciprocal Trade Agreements Act must be extended if our
trade and investment are to continue to increase and prosper.
Second in my tabulation of the four types of financing
efforts, and second also in historical evolution, are the
so-called bankable or hard currency loans made by lending
agencies.

23
- 5As World War II was drawing to a close, the United States
Government realized that there would be a great demand for
financing economic development abroad in the period of peace
which we hoped would follow. To this end, the Congress
expanded the lending activities of the Export-Import Bank
of Washington, the United States Government foreign lending
agency which had been created to assist in financing exports
from this country. The United States Government also took
the lead in the establishment of the World Bank and has
subscribed about one-third of its capital. The activities
of the two banks have supplemented each other to an
important degree. The World Bank, as an international
organization, finances projects in any of its member countries,
and suppliers in any of its member countries can bid on the
contracts. The Exports-Import Bank, on the other hand, lends
only for exports from the United States. Since 1934, the
Export-Import Bank has made loans of more than $7-1/2 billion,
most of which have been important in economic development
overseas. It now has $3 billion of loans outstanding. The
World Bank, since 1946, has loaned a total of $3.4 billion,
and now has outstanding about $2.2 billion in loans.
India is a good example of a country with a large
development program which has benefited from the operations
of these two banks. Recently, the Export-Import Bank has
authorized a loan of $150 million to India to provide
United States goods needed in irrigation and reclamation,
power, mining, transport, and industry. The World Bank has
loaned more than $100 million for the expansion of a large
steel enterprise in India with a guarantee of the Indian
Government. In previous years it has also extended loans
for steel plants, for the construction of power facilities,
the clearing of land, and for the improvement of the railway
system. With the funds provided by both banks the Indian
program can go forward in the acquisition of capital goods
from abroad to be financed over a substantial period of years.
India will have the use of savings which have been mobilized
by a United States Government institution and by an international institution, and this substantially relieves the
current strain on their foreign exchange earnings and resources,
I should now like to turn to loans repayable in local
currencies which constitute the third of my four classifications
of international financing operations. This is the nexvest
technique. It is particularly designed to meet the special
problem of accelerating development in areas and in types of
investment that are beyond the margin that can attract
financing
investment
or from the lending agencies
which
makefrom
hardprivate
currency
loans.

24
- 6 The two banks which I have just discussed must make loans
repayable in dollars, or, in the case of the International
Bank, to some extent, in other relatively hard currencies.
The less-developed countries, however, are not always in a
position to service such loans. They need projects, such as
waterworks, highways, irrigation and drainage projects, that
will eventually do much to improve their economic conditions,
but which do not immediately yield or save foreign exchange
to enable them to pay off hard currency loans. The Congress
of the United States has recognized this need by
establishing the Development Loan Fund, which will lend
for projects that may be quite significant in terms of
country needs but cannot be financed by the other institutions.
A large portion of the Development Loan Fund loans will be
repaid in the currency of the borrowing country — not in
foreign exchange. In this way, help can be given to countries
whose immediate economic prospects are not as favorable as
others. The Development Loan Fund is making loans which we
frankly recognize are "soft" loans. The terms of repayment
will impose a light burden on the economies of the countries.
They represent a contribution which we are making toward
development projects that could not otherwise be financed.
The DLF has been in operation only a few weeks and has already
committed in excess of $100,000,000 in loans of the type just
mentioned to under-developed countries. The Fund is currently
operating with a capital of $300,000,000 appropriated by
Congress for Fiscal Year 1958. It is hoped that the Congress
will include $625,000,000 additional in the budget for
Fiscal Year 1959.
In this discussion, I have not tried to cover the grants
of economic assistance which we have made and which we will
continue to make in some areas. While these grants can also
provide for some development financing, they have been largely
utilized in recent years to meet so>me of the economic impact of
large military establishments that are being maintained by many
of the free world countries in the interest of the common
defense.
I should, however, say a few words about my fourth
point, sale of surplus agricultural commodities under what
is usually called the Public Law 480 program. Since its
inception in 1955 agreements amounting to about $2,6 billion
have been reached with foreign countries for the sale of
agricultural commodities. The statute provides a number
of uses which may be made of the resulting local currencies.
More than half of them are being devoted to loans, broadly
similar
in
terms
ofbe
repayment
to
those
which
we
are provide
now
using
capital
currency
in the Development
goods
which
from
can
Loan
abroad
used
Fund.
but
to does
further
The
program
result
development.
in
does
a fund
not
of local

25
- 7Now I would like to draw your attention to two very
important considerations that are common to all four types
of financing arrangements I have mentioned. The first applies
to the less-developed countries. They must rely on local
savings for the major part of their requirements. No
large country has ever been able, to the best of my
knowledge, to obtain more than a rather small fraction of
its financing requirements from foreign savers. There is
not enough to spare in any one country to meet the capital
needs of the world. A very large part of the expenditures
required for development are for labor and supplies that are
produced within the country using them. One of the major
needs in all less-developed countries will be to continue to
develop their internal financial systems and to create
conditions of financial stability which will bring forth
more savings for local investment. While we can provide
assistance and some of the impetus, the final responsibility
rests with the countries concerned. Results will depend in
a large measure on their desire and ability to conduct their
affairs on a sound basis.
The second closing point applies to us. The use of our
savings by foreign countries is not just a one-xvay street.
We benefit also in no small measure because a very large part
of these funds which we make available are spent on United
States exports, either on agricultural commodities or on
capital goods. The several billion dollars a year in public
and private savings which will be used for financing economic
development In this current year will represent a very
significant factor in sustaining income and employment in
agriculture and industry in the United States. We have become
a great exporting nation in capital goods. The continuation
and growth of this industry is directly related to the
availability of development financing.
To return to the keynote topic of this meeting,
"Today's Challenge in Trade and Aid,u there is no doubt
that the economic gx°owth of the free world offers a great
and exciting challenge. We in the United States have been
working hard to meet it for the last decade and are constantly
evolving new techniques and approaches to improve upon our
effectiveness. Our country has
0O0accepted the challenge and
we will meet it.

- 3XgKHK

or by any local taxing authority. For purposes of taxation the amount of disc
at which Treasury bills are originally sold by the United States is considered
be interest. Under Sections h$k (b) and 1221 {$) of the Internal Revenue Code
1954 the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed <
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereun<
need include in his income tax return only the difference between the price paix
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 4l8, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copic
of the circular may be obtained from any Federal Reserve Bank or Branch,

-2-

mWmlt

2 percent of the face amount of Treasury bills applied for, unless the tender

accompanied by an express guaranty of payment by an incorporated bank or trus
company,
Immediately after the closing hour, tenders will be opened at the Federal J

serve Banks and Branches, following which public announcement will be made by

Treasury Department of the amount and price range of accepted bids. Those sub
mitting tenders will be advised of the acceptance or rejection thereof. The

Secretary of the Treasury expressly reserves the right to accept or reject an

all tenders, in whole or in part, and his action in any such respect shall be
final. Subject to these reservations, noncompetitive tenders for $200,000 or

without stated price from any one bidder will be accepted in full at the aver

price (in three decimals) of accepted competitive bids. Settlement for accept
tenders in accordance with the bids must be made or completed at the Federal
serve Bank on April 10, 1958 , in cash or other immediately available fund
or in a like face amount of Treasury bills maturing April 10, 1958 Cash

and exchange tenders will receive equal treatment. Cash adjustments will be m
for differences between the par value of maturing bills accepted in exchange
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

sale or other disposition of the bills, does not have any exemption, as such,
loss from the sale or other disposition of Treasury bills does not have any

special treatment, as such, under the Internal Revenue Code of 1954. The bill

are subject to estate, inheritance, gift or other excise taxes, whether Feder

or State, but are exempt from all taxation now or hereafter imposed on the pr

or interest thereof by any State, or any of the possessions of the United Sta

ASSUSA

-jZ^xs

TREASURY DEPARTMENT
Washington
A. M.
X8K RELEASE/XKWCDK NEWSPAPERS,
Thursday, April 5, 1958
• #

amount will be payable without interest. They will be issued in bearer form on

and in denominations of $1,000, #5,000, $10,000, $100,000, $500,000 and $1,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
closing hour,/tone o*clock p.m., Eastern Standard time, Monday, April 7, 1958

Tenders will not be received at the Treasury Department, Washington. Each tend

must be for an even multiple of $1,000, and in the case of competitive tenders

the price offered must be expressed on the basis of 100, with not more than th
decimals, e. g., 99.925. Fractions may not be used. It is urged that tenders

be made on the printed forms and forwarded in the special envelopes which will
supplied by Federal Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit tenders
except for their own account. Tenders will be received without deposit from

incorporated banks and trust companies and from responsible and recognized dea

in investment securities. Tenders from others must be accompanied by payment o

TREASURY DEPARTMENT
WASHINGTON, D.C.

RELEASE A'.M. NEWSPAPERS,
Thursday, April 3, 1958.

A-205

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing April 10, 1958,
in the amount of $1,699,903,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated April 10, 1958,
and will mature July 10, 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,00Q, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Standard time
Monday, April 7, 1958.
Tenders will not be received at the
Treasury Department, Washington. Each tender must be for an even
multiple of $1,000, and in the case of competitive tenders the price
offered must be expressed on the basis of 100, with not more than
three decimals, e. g., 99.925. Fractions may not be used. It is
urged that tenders be made on the printed forms and forwarded in the
special envelopes which will be supplied by Federal Reserve Banks or
Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from Incorporated banks and trust companies and from
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
In whole or in part, and his action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
.$200,000
or full
less without
stated price from
any one
bidder will
be
accepted in
at the average
(in three
decimals)
of accepted

- 2 competitive bids. Settlement for accepted tenders in accordance
with the bids must be made or completed at the Federal Reserve Bank
on April 10, 1958,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing April 10, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter Imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on
original Issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.
0O0

- 2

XKMGDIA1B ML1ASE,
Wednesday, April Z. 1958.

The Treasury Department announced today that on Monday, April 79
it will offer-, for eaeh subscription $5*1/8 billion, or thereabout**
of g~5/8 percent 4*year 10-month Treasury•• notes, The subscription
books will be open only on April 7 for this offering. In addition
up to $100 million of the notes may be allotted to Government Invest*
Kent Amounts.
sa3
The new notes will be dated April IS, 1®B89 and' will mature
February 15, 19m. Interest will be payable on "a ©emiamual basis
on August IS, 1958, and thereafter on February 15 and AvguBt,15 in
each year.
Subscriptlone trm commercial bank®, whiih for th&c purpose
are defined a® banks accepting deaand deposits*, for their own account, will be received without deposit, but will be restricted to
m amount not ejtwiting 7S percent of the combined capital, mm- .v
plus a M undivided profit* ©f the subscribing bank. A payment of »nal
10 percent of the amount of notes subscribed for mustfoemade on sued
all other subscriptions. The nm securities my be paid for by '.Is
credit in Treasury tax m€ loan accounts.
Commercial bank® and other lenders are requested to refrain
from making unsecured loann, or loans collateralized in whole or
in part by the notes subscribed for, to cover the deposits re*
quired to be paid when subscriptions are entered.
Any fttftwe-riptie* addressed to a Federal leserve Bank or Branch,
or to the Treasurer of the felted State®, and placed in the mail
before midnight, April 1, will be considered as timelv.

TREASURY DEPARTMENT
WASHINGTON, D.C.
IMMEDIATE RELEASE,
Wednesday, April Z. 1958.

A-206

The Treasury Department announced today that on Monday, April 7,
it will offer for cash subscription $3-1/2 billion, or thereabouts,
of 2-5/8 percent 4-year 10-month Treasury notes. The subscription
books will be open only on April 7 for this offering. In addition
up to $100 million of the notes may be allotted to Government Investment Accounts.
The new notes will be dated April 15, 1958, and will mature
February 15, 1963. Interest will be payable on a semiannual basis
on August 15, 1958, and thereafter on February 15 and August 15 in
each year.
Subscriptions from commercial banks, which for this purpose
are defined as banks accepting demand deposits, for their own account, will be received without deposit, but will be restricted to
an amount not exceeding 75 percent of the combined capital, surplus and undivided profits of the subscribing bank. A payment of
10 percent of the amount of notes subscribed for must be made on
all other subscriptions. The new securities may be paid for by
credit in Treasury tax and loan accounts.
Commercial banks and other lenders are requested to refrain
from making unsecured loans, or loans collateralized in whole or
in part by the notes subscribed for, to cover the deposits required to be paid when subscriptions are entered.
Any subscription addressed to a Federal Reserve Bank or Branch,
or to the Treasurer of the United States, and placed in the mail
before midnight, April 7, will be considered as timely.

• 1•

32
Consistent wits %%* general treatment ®f educational
^ ymmm mi *1X taxpayers, tit® wmmlmtimm provide tiis*
educational expenses are not deductible if the education is
required of the taxpayer 4a ® f t o to »®#t tfe# mAmAmm
wmmAm*
mmtm Mm* m^mAAMication «r frtsfeUttamt isfeisiat*s*M i***t*
or business, or th^ education Is undertaken primnrily tm%f
tAim purpose ®g obtaining a mm position ®w substantial advancement is ysoitiM* mm priiisjrilr Iff mm purpose mi fulfilling
the general
education
aspirations
mi the taxpayer.
m believe
tlmt mm
$issl ragnlmticais
»**t mmm mi tfes
objections directed against the proposed regulations. You
« & U mmtm tfcst itap mm soosistsst wit* tfcs sltjMtivw
you expressed is your letter.
With kind

Secretary of t%m treasury

Monoa»able Marion B. Folsoa
Secretary of Health, Education and mmUtmrn
mm. w. %*•

My Sear Mr. Secretary:
Ibis is is reply to year latter of Xareh 14, its*, ess*
eersiss the deductibility of assesses isesrred by ttt^tft
for educatioa.
ma saw regulatiooa as buslaees espessss, iacludiag
assesses Incurrad by teachers for educatioa, have bass fives
final approval by tale Department. The saw rasa la t lass fiva
sjteh sera liberal tss trsstaest far such espeaaes. fbs
regsistiess (a copy enclosed) are being f Had sits tss Federal
itegister today.
/^The saw regulations result fnm propoaad regalatioaa as
business expenses which have been asdsr review for seas tiae
by this Bepartsent. tSa proposed regsistiess invoked stress
objectloa by various groups, iaciodiag represeatatives at
teachers, which vara voiced at public hearlegs bald oa
September 11, 1956, asd submitted is writ tea protests* m e
sresest approved regulattoas were tba result ef study of the
objectless asd s re-esasiaatioa of court deciaioas as tba subject*
MRs* f iaal regslstiess are sore liberal tbss tss prcpaaad
is that tba assesses Iseurred by a teacher for edssstlos say
be deducted eves though auab essessss are iacurred velttstarily
asd awas though tba courses taken carry academic credit ear
result is as iseresss is salary j^jpajsailas.:~"tlflUl» is effect,
reaoves the dlst last lea previously draws hetssss seii-espleyed
persons asd esployeas such as tessaars^ 4^ #<£& f
Under tba regulatioss, expeaditures far edsssties ass
deductible if undertakes "primarily far tba purpose" of <1)
salstststsg or tsprswisg skills required by a taxpayer is bis
espieyaest or other trade or assises*, or <3) eeetisg tba
******* regsireseats si tbe taxpayer'a esalsysr (or applicable
law) iaposed as a eeaditiss to tba ratestlos by tba taxpayer
of bis salary, status mm eesloyseat. ifee resistless also
provide tbat if it is custoamry for other established sambsrs
ef tba taxpayer's trade or business to sadertaxe educatioa of
tbe type referred to is <1> above, tbe taxpayer will erdiaarily
be considered to have uadertakas this edssstlss far tss required purposes. Ibis sill, of course, be of sssistssse to
teachers.

DEPARTMENT OF

HEALTH. EDUCATION, AND WELFARE
WASHINGTON

MAR I 4 1958
Dear Mi. Secretary:
A3 you will recall, we discussed some time ago tv: ieslre'Mlity of some appropriate step which would mar** af*Njat*vly
recognise the special situation of teacners In conne.'T.lot. vir,h
the deduction, under the Incase tax law, of expenses ino irr*M
by them for further education.
I understand that the interpretation of the extstlrvg lav
as it applies to the deductibility ol **a^cation c7Cpena.^r of
professional people, both self-sap icy*^ ir.*\ ea$>Ljyees, 1.
covered by proposed regulation- which ar* nd* be in/; revi^t-a.
on the ba*lt» of objections file-i by various jyroaps, inci -it'*;
representatives of teachers. Represent^ ti vet* of thit "'\'«rtw:*
have engaged In discussions with your »t*ff on t^*? sub>*•-• of
tn« proposed regulation and the pro*-»st* f^or teacher "-^im:.
I am writing, therefore, simply to •*- ^>.>u5lz>.* *.ne it;; i••**• :,
fratt, ar educational point af view, at *• pror.pt rtso.. ivi sr ai *-^i
problex either by sodificmt.ion of th«* or-jposed regulations, if
appropriate, or by legislation, if ne :*< -ary#
The developments of recent ^vmll-, have thrown int *»!»arv
focus the need for isprufement in our *KIUC <.t local standard?, T-Administration has responded, as you •OVTV, by requesting a v?n-f'»i Increase in appropriations for program ^ai^irtered *>y ..^ v r.; jr^i
cience Foundation designed to laprow the subject-oaf-?r ^novle^of mathematics and science teachers. The Adaini^tratlo . i^a
also recommended prograns, to be adad'iistered by tni.-. i*!p*rrment, which would adapt essentially the same type of i* -service
training institutes to improve the knowledge and skill of
language teachers and of personnel engaged in educational
counseling and guidance* This recognition of the import* u;_t:
to the national security of encouraging teachers to employ their
suxaaer^ and their leaves of absence in acquiring greater mastery
of their professional responsibilities leads also, I believe, to
the conclusion that the criteria whicL ao« govern the U-iuctl-rt ity
of expenseb of teaeaers for furtner edu.-ation should N liberalized.

The Secretary of the Treasury transmitted to the Congress
suggestions for a permanent policy for the taxation of life insuran<
companies.

Up to now taxation has been on a basis of "stopgap"

legislation while study groups under the Treasury Department and the
Congressional committees have been working toward a permanent
solution.
Secretary Anderson said, "A fair and more lasting method of
taxing life insurance companies to replace the series of temporary
formulas will fulfill a long standing need in our tax structure."
Secretary Anderson's letter presents two alternative approaches
toward modifying existing law. The present method of taxation does
not recognize sources of net income to the life Insurance companies
other than investment income, and the suggestions are calculated to
bring the companies taxable income concept into closer conformity
with that of other corporate businesses.
The Treasury's suggestion for "first consideration" is that the
starting point for measuring the net earnings of a company should
be the fIgureJfor "Net Gain Prom Operating After Dividends to
Policyholders" which appears in each company's annual statement to
State insurance departments.
The second suggestion made by the Treasury consists of possible
modification more in line with the present method of taxation of
life insurance companies.
The Secretary also said that whatever tax formula is applied
to the ordinary income of life insurance companies, their capital
gains and losses should not longer be disregarded for tax purposes.

/*v.

jm+

M***~ (2^^<3f

NeWj^mo.jEus aAJaaaiftg income tax regulations relating-to
deductibility ofteaflirieoobxpon&e&-3 -fefte^acLLog expenses incurred
by-m&mmmWmwm for education/we re made public today by the Treasury
Department.

~ „ ^

J5JUDUL

TJL

(*£iv*<-

Treasury Secretary Robert B. Anderson^ said the new regulatior
stem from / ^oposea regulations which have been.under review for
some time by the Department. x\-The p reposed lu^ulabi^cwere the
subject of objections on the part gf"yarp)us groups, ^ e l u d i n g
iteachers.

A study of the objections,,together wi>h a/re-

examination of cxmpt decJrs'ions on the ^ubjec^f resulted in the
present new regulationsjtf^wrllfai^rr^"

„

Secretary Anderson mudo those- comment^in a letter to
Marion B. Polsom, Secretary of Health, Education and Welfare,
who had earlier expressed his interest in the tax treatment of
teachers' expenses for further educ-ation^

<**N-

, *\ .

"The new regulations give Much more lib^xal^ia^iJirg-at^nt
for such expenses^PrTSSc^^ry AnclersonssSajy-^rta^ng that "they
are consistent with the objectives which you expressed in your
letter."
Secretary Polsom had written on March Ik of the desirability
more adequately recognizing the special situation of teachers in
connection with the deduction of expenses incurred for further
education.
"The developments of recent months have thrown into sharp
focus the need for improvement in our educational standards,"
Secretary Polsom said.
Attached are copies of the letters between Secretary Andersor
and Secretary Polsom^ <8twh~e4^&fefce^

TREASURY DEPARTMENT

WASHINGTON, D.C.
RELEASE A.M. NEWSPAPERS,
Friday, April k. 1958.

A-207

New income tax regulations relating to deductibility of
expenses incurred for education were made public today by the
Treasury Department.
Treasury Secretary Robert B. Anderson said the new
regulations stem from earlier proposed regulations which have
been under review for some time by the Department.
"The final regulations are more liberal than the proposed
in that the expenses incurred by a teacher for education may
be deducted even though such expenses are incurred voluntarily
and even though the courses taken carry academic credit or
result In an increase in salary or promotion. This, in effect,
removes the distinction previously drawn between self-employed
persons and employees such as teachers," he said.
Secretary Anderson commented on the new regulations in
a letter to Marion B. Polsom, Secretary of Health, Education
and Welfare, who had earlier expressed his Interest in the tax
treatment of teachers' expenses for further education.
"The new regulations give much more liberal tax treatment
for such expenses," (teachers' expenses for further education)
Secretary Anderson wrote Secretary Polsom. He added that
"they are consistent with the objectives which you expressed
in your letter."
Secretary Polsom had written on March Ik of the desirability of
more adequately recognizing the special situation of teachers in
connection with the deduction of expenses incurred for further
education.
,!
The developments of recent months have thrown into sharp
focus the need for improvement in our educational standards,"
Secretary Polsom said.
The earlier proposed regulations were the subject of
objections on the part of various groups, including teachers.
A study ot the objections by the Treasury Department together
with a re-examination of court decisions on the subject
resulted in the present new regulations.
Attached are copies of the letters between Secretary
Anderson and Secretary Polsom.

_2 -

39
April 3, 1958

My dear Mr. Secretary:
This is in reply to your letter of March lk. 1958, concerning the deductibility of expenses incurred by teachers
for education.
The -new regulations on business expenses, including
expenses incurred by teachers for education, have been given
final approval by this Department. The new regulations give
much more liberal tax treatment for such expenses. The
regulations (a copy enclosed) are being filed with the Federal
Register today.
The new regulations result from proposed regulations on
business expenses which have been under review for some time
by this Department. The proposed regulations invoked strong
objection by various groups, including representatives of
teachers, which were voiced at public hearings held on
September 11, 1956, and submitted In written protests. The
present approved regulations were the result of study of the
objections and a re-examination of court decisions on the
subject.
The final regulations are more liberal than the proposed
in that the expenses incurred by a teacher for education may *
be deducted even though such expenses are Incurred voluntarily
and even though the courses taken carry academic credit or
result in an increase in salary or promotion. This, in
effect, removes the distinction previously drawn between
self-employed persons and employees such as teachers.
Under the regulations, expenditures for education are
deductible if undertaken "primarily for the purpose" of
(l) maintaining or improving skills required by a taxpayer in
his employment or other trade or business, or (2) meeting the
express requirements of the taxpayer's employer (or
applicable law) imposed as a condition to the retention by
the taxpayer of his salary, status or employment. The
regulations also provide that if it is customary for other
established members of the taxpayer's trade or business to
undertake education of the type referred to in (l) above,
the taxpayer will ordinarily be considered to have undertaken
this education for the required purposes. This will, of
course, be of assistance to teachers.
Consistent with the general treatment of educational
expenses of all taxpayers, the regulations provide that
educational expenses are not deductible if the education is
required of the taxpayer in order to meet the minimum
requirements for qualification or establishment in his
primarily
intended trade
for the
or purpose
business,
ofor
obtaining
the education
a new position
is undertaken
or

substantial advancement in position, or primarily for the
purpose of fulfilling the general education aspirations
of the taxpayer.
We believe that the final regulations meet many of the
objections directed against the proposed regulations. You
will note that they are consistent with the objectives
which you expressed in your letter.
With kind regards,
Sincerely yours,
/s/Robert B, Anderson
Secretary of the Treasury

Honorable Marlon B. Polsom
Secretary of Health, Education and Welfare
Washington 25, D. C.

- k DEPARTMENT OF
HEALTH, EDUCATION, AND WELFARE
WASHINGTON
March 14, 1958
Dear Mr. Secretary:

As you will recall, we discussed some time ago the
desirability of some appropriate step which would more
adequately recognize the special situation of teachers in
connection with the deduction, under the income tax law, of
expenses incurred by them for further education.
I understand that the interpretation of the existing law
as it applies to the deductibility of education expenses of
professional people, both self-employed and employees, is
covered by proposed regulations which are now being reviewed
on the basis of objections filed by various groups, including
representatives of teachers. Representatives of this
Department have engaged in discussions with your staff on the
subject of the proposed regulations and the protests from
teacher groups. I am writing, therefore, simply to
emphasize the importance, from an educational point of view,
of a prompt resolution of this problem either by modification
of the proposed regulations, if appropriate, or by legislation, if necessary.
The developments of recent months have thrown into sharp
focus the need for improvement in our educational standards.
The Administration has responded, as you know, by requesting
a ten-fold increase in appropriations for programs
administered by the National Science Foundation designed to
improve the subject-matter knowledge of mathematics and
science teachers. The Administration has also recommended
programs, to be administered by this Department, which would
adapt essentially the same type of in-service training
institutes to improve the knowledge and skill of Language
teachers and of personnel engaged in educational conseling and
guidance. This recognition of the importance to the national
security of encouraging teachers to employ their summers
and their leaves of absence in acquiring greater mastery
of their professional responsibilities leads also, I
believe, to the conclusion that the criteria which now govern
the deductibility of expenses of teachers for further education
should be liberalized.
In all professional fields refresher courses, attendance
of
the
at developments
institutes,
maintenance seminars,
and
in one-chosen
improvement
and other
field
of professional
ways
are of keeping
course
competence.
helpful
abreastto

42
- 5For teachers, however, further education plays and especially
significant and indeed indispensable role. In the day-to-day
practice of their profession they develop and improve
teaching skills, but for bringing up to date and expanding
their knowledge of the subject matter In the field In which
they teach, as well as for learning new or improved teaching
methods and acquiring such other knowledge as will make them
better teachers, it is often necessary that they look to other
sources. Every teacher ivho genuinely desires to become more
effective in communicating knowledge, inspiring curiosity and
imagination, and encouraging the student to use and develop
his capacity to think — in short, every good teacher —
seeks from time to time to further these aims by enrolling
in some formally organized course of instruction.
Where such a course is undertaken by a teacher for the
purpose of acquiring greater effectiveness in carrying out
the responsibilities of his calling, it should not be
essential to the deductibility of the expenses incurred that
the teacher be required to take the course in order to retain
his job, all the more so because pressures short of the
sanction of dismissal are often involved.
So long as the purpose of his taking the course is that
of rendering greater service in the capacity in which he is
qualified to serve, an established teacher should be
entitled to deduct the expenses of further education. Any
other rule would tend to discourage the in-service, extramural,
training which is necessary if the teaching profession is to
respond to the challenge of these critical times.
Whether modification of the proposed regulations, or the
course of new legislation, is the appropriate one to follow
is naturally a matter for your decision. Speaking for a
Department broadly concerned with the needs^ of education,
I wish only to urge your early and sympathetic consideration
of the problem.
With kindest regards,
Sincerely yours,
/s/ Marion 3. Folsom
Secretary
Honorable Robert B. Anderson
Secretary of the Treasury
Washington 25, D. C,

- 2-

43
"With Mrs, Neal he -will fly on April 11 from New York to Lisbon and visit
Madrid, Nice, Some, Naples, Florence, Venice, Lucerne, Interlaken, Paris,
Brussels. London

<4< »»v*ute *ul

y9 returning May 2$.

'^y^

6WH+**y^.m*jLmmm-%

In Washington today, Mr. Neal was conferring with officials of the Treasury,
Defense and State Departments for mutual briefing

on his bond mission, which

would include speaking appearances and conferences

Savings Bonds Bivistoa
APPROVAL
<--<y
Edmund JjVO&nehan "" Dater"""
-', - -#.
r

Bate

¥tj^m.L:j2m4jk±*
Seetioxs Chief "

^ate

TREASURE DEPARTMENT
SAVINS eONDS ^P/lSlON
•\'---t/^y\

XST

°/" '• » - ^- d/

Washington,1B.~C^^

^pv^fTjjereN^-D; C^r5pd^l4. — Secretary of the Treasury Anderson today
announced the appointment of William E. Neal, Winston-Salem, N* C , banker,
as

special representative of the Treasury and "roving ambassador1* for the

A
United States Savings Bonds program during a European tour in the next two months

4*} fe> \A*M J^ n^.^JU^^tM*U VKsm*~ ^ffu^c*^ /
, Mr; Neal will consult with heads of U. S. military and civilian agencies and

i
establishments in the NATO nations to assist them in the bond campaigns starting
this spring with the object of expanding payroll savings participation .
In his letter of appointment Secretary Anderson noted that volunteer forces
are conducting Share in America savings bond campaigns in 233 key cities of the
United States and thefcthe interdepartmental savings bonds committee is joining
in this on a worldwide basis wherever

Americans are stationed abroad*

themejpf the campaign is building Peace Power by helping to strengthen

The
the

economic basis of military , scientific and industrial phases of defense against
the communist threat.
The senior vice president of the Wachovia Bank and Trust Company of
WinstonQSalem,

Mr* Neal for a dozen years after 191*2 was chairman of the

volunteer war savings and savings bonds committees for North Carolina*
In January, 19i>2, he was one of 1$ state chairmen condeated on a tour of
NATO installations in Europe by the Department of Defense to report on
progress of measures to check the spread of communism* In 19$y-$6 he was
national chairman of the savings bonds committee of the American Bankers
Association. In October , 195k, he received the Treasury1 s
Service Award,

the highest honor for volunteers.

Distinguished

TREASURY DEPARTMENT
WASHINGTON, D.C.

IMMEDIATE RELEASE,
Friday, April 4, 1958.

A-208

Secretary of the Treasury Anderson today announced the
appointment of William H. Neal, Winston-Salem, N.C., banker, as
special representative of the Treasury and volunteer "roving
ambassador" for the United States Savings Bonds program during a
European tour in the next two months. His trip will be made at
his own expense. Mr. Neal will consult with heads of U.S.
military and civilian agencies and establishments in the NATO
nations to assist them in the bond campaigns starting this
spring with the object of expanding payroll savings participation.
In his letter of appointment Secretary Anderson noted that
volunteer forces are conducting Share in America savings bond
campaigns in 233 key cities of the United States and that the
interdepartmental savings bonds committee is joining in this on
a worldwide basis wherever Americans are stationed abroad. The
theme of the campaign is building Peace Power by helping to
strengthen the economic basis of military, scientific and
industrial phases of defense against the communist threat.
The senior vice president of the Wachovia Bank and Trust
Company of Winston-Salem, Mr. Neal for a dozen years after 1942
was chairman of the volunteer war savings and savings bonds
committee for North Carolina. In January, 1952, he was one
of 15 state chairmen conducted on a tour of NATO installations
in Europe by the Department of Defense to report on progress of
measures to check the spread of communism. In 1953-56 he was
national chairman of the savings bonds committee"of the American
Bankers Association. In October, 1954, he received the Treasury's
Distinguished Service Award, the highest honor for volunteers.
With Mrs. Neal he will fly on April 11 from New York to
Lisbon and visit Madrid, Nice, Rome, Naples, Florence, Venice,
Lucerne, Interlaken, West Germany, Paris, Brussels and
London, returning May 25.
In Washington today, Mr. Neal was conferring with officials
of the Treasury, Defense and State Departments for mutual
briefing on his bond mission, which would include speaking .
appearances and conferences abroad.

oOo

46
TREASURY DEPARTMENT
Washington
FOR RELEASE P.M. NEWSPAPERS,
Monday, April J} 1958.

Remarks by Secretary of the Treasury
Robert B. Anderson at "Share in America"
Savings Bonds Campaign Luncheon,
Waldorf-Astoria Hotel, New York City,
12:30 P.M., April 7, 1958
I am happy to be here with you today at this kick-off
luncheon for the "Share in America" savings bonds campaign in
the New York metropolitan area. The savings bonds program is
an activity of top importance not only to sound Government
financing and a healthy debt structure, but also to the health
of our free economy. Moreover, it is a program of direct
meaning and purpose to every individual American in helping him
to systematically save out of current income and build
financial reserves for the important goals in his personal life.
As you are aware, we are conducting campaigns this spring
in 233 large cities and metropolitan areas throughout the
country to enlarge payroll participation and bring new savers
into the savings bonds program. New York being our largest area,
much of our success will depend upon the vigor and enthusiasm
which you people here today will be putting into your personal
campaign to sign up new payroll savers in your businesses and
industries.
I understand that there are over 3-1/2 million persons
employed by companies represented in this room. Virtually all
have the payroll savings plan in effect. About 30 percent of
the employees are now on payroll savings, leaving a potential
of over 2-1/2 million employees who can start their Savings
Bond program during New York'sMShare-in-America"campaign.
By way of dollars and cents, this is what it would mean to
the Treasury to obtain these 2-1/2 million new savers -- over
$625 million a year in Savings Bond sales, for the average
month's savings now set aside by payroll savers is $20.00.
I have no doubt that you will produce telling results.
Nevertheless, in my time here today, I want to take up with
all of you, as I have with the Chairmen of these campaigns
throughout the country who met earlier with me in Washington,
the reasons why we believe that savings bonds purchases are
A-209
particularly
important at this moment in world affairs to the
financial and economic strength of America.

47
- 2 The first thing to be recognized in evaluating our financial
strength and responsibilities Is, of course, the immensely
increased threat to our security resulting from the Soviet
scientific advances. Our Government must now maintain defense
programs of a magnitude unprecedented in our peacetime history.
We must keep in the lead of scientific progress. We must
devise and have in readiness the most modern instruments of
warfare and defense against any possible aggression.
These programs are costly. They will remain costly for a
long time to come.
Every American knows that the necessary funds will be
provided. But it is equally important to make sure that our
financing operations contribute In the highest degree possible
to maintaining the strength and stability of the economy. Our
enemies would like nothing better than to see us adopt hastily
conceived measures which would eventually weaken our
productive power.
This is where savings bonds enter the picture. The
Treasury is pushing sales as vigorously as possible at the
present time because of the major contribution which the
savings bonds program makes to the financial health of the
economy.
The first way in which this comes about is through the
leadership of the savings bonds program in encouraging thrift
in all forms — a goal which has been stressed by the Treasury
ever since the inception of the program. Savings bonds have
never been promoted at the expense of other types of savings.
On the contrary, the program has served a unique purpose in
encouraging people to save in many different ways". We have no
way of estimating how much the savings bonds program has
contributed to the total of well over $300 billion which
individuals have saved in this country during the past two
decades. But we do know that the contribution has been tremendous,
and we are extremely proud of the part which the payroll savings
plan in particular has played in helping millions of American
families to establish regular habits of thrift.
Now, it may be asked how saving part of one's income helps
the country as well as the individual saver. But a moment's
reflection will make the point clear.
The surest way to maintain our Nation's strength in these
critical times is to provide our economy with the necessary
capital to explore new areas of science, to buy the plant and
equipment needed for efficient use of our working force,
and to maintain sufficient flexibility to move quickly in
response
to up-to-date.
changing
conditions.
Our
and
economy
to keep
requires
tremendous
amounts
ofhigh-s^eed
capital toAmerican
keep going --

48
- 3 But real capital must be saved. It cannot be created by any
form of monetary magic. Thus, when individual citizens save
part of their incomes they are helping the economy grow by
providing needed capital. Their regular purchase of savings
bonds through the payroll savings plan helps to do this.
The money coming into the Treasury from savings bonds
sales means that the Government will need to borrow just that
much less from financial institutions, such as banks and
insurance companies. Thus, more of the funds of these
institutions are made available for private financing uses -a function never more important than now.
Another way that the purchaser of savings bonds contributes
to the financial soundness of the country is through assisting
the Treasury in its task of sound debt management.
Our Government debt is large, amounting to about $275
billion at the present time. While this is a heavy burden,
good debt management can keep our debt inheritance from
hampering sound economic growth. Go.od debt management, however,
depends on selling as many Government securities as possible
to people who are buying bonds out of their earnings. When the
Treasury sells securities to these people, it is able to avoid
too much reliance on the commercial banking system as a source
of funds. This reduces the long-term danger of inflation and
helps safeguard the value of the dollar.
We are striving in our debt management activities in the
Treasury to work toward a better structure of the public debt.
Our present debt is too short. We have more than $75 billion
of marketable securities which fall due during the calendar
year 1958. Some part of this debt is coming due each month
so that at all times the Treasury is faced with substantial
refunding problems.
A sound objective of fiscal policy is to extend the
maturity of new issues whenever opportunities are available.
To the extent that we are able to reduce the times the Treasury
has to borrow money each year, we will be contributing to
a smoother flow of corporate and municipal financing in the
capital markets. We will also be contributing to the amount of
free time which the Federal Reserve has to take effective
monetary action without always having to be concerned with a
new Treasury financing which is coming up, or an issue of new
securities which is still in the process of being lodged with
the eventual holders of the securities. This means taking
advantage of opportunities whenever they present themselves
to sell Treasury bonds — which mature in* 5 years or more -rather than Treasury short-term bills, certificates, and notes.

49
- 4We have had such opportunities in the last six months when
the Treasury sold more than $8 billion of bonds running
5 years or more to maturity. In addition, since last summer,
we have sold more than $9 billion (including our new $3-1/2
billion issue which we announced last Wednesday) of Treasury
notes in the 4 to 5 year area. We feel that this has helped us
materially in getting a better balance In our debt structure.
But better balance in debt structure is not just confined
to marketable debt. Over $100 billion of our debt is not
marketable — savings bonds, special issues to trust funds, etc.
These issues to the trust funds, like Social Security,
Veterans' Life Insurance, etc., are firmly placed in that they
represent the long-term savings of individuals being held in
trust by the Government. The nonmarketable debt also includes
U« S. Savings Bonds. They also represent long-term savings.
Individuals hold on to their E Bonds something like 7 years on
the average.
So, for many reasons, savings bonds purchases represent
a good deal more than a wise choice of a personal investment.
In buying bonds our people are also contributing to the sound
conduct of the Government's finances and to the financial
strength of the Nation.
Some people may ask you, however, as they have asked me •—
"Why is the Government promoting savings bonds sales at this
particular time? In view of the current business decline,
wouldn't it perhaps be better to encourage our people to go out
and buy things rather than adding to their financial reserves?"
The question is not a new one. I understand that during every
business decline in the postwar period similar questions have
been put to the Treasury.
In any concentration on current business indexes and
trends, it is often easy, of course, to temporarily lose sight
of the long-term sustaining forces that have made our country
great. Ranking very high among these forces is the habit of
thrift, which is fundamentally responsible for the sound
financing of our Nation's industrial might as well as a
backlog of savings for millions of our people.
The habit of thrift is not something to be encouraged at
one time and discouraged at another. It is much too basic.
As a matter of fact, the present economic downturn is the
aftermath of an Inflationary boom which would have been much
milder had Americans saved more than they did during recent
years.
The Government, as you know, has already taken a number
of significant steps in the fiscal and monetary areas which
are having important and helpful economic effects across the
Nation. It is important that consumption by individuals be

- 5maintained at a high rate. Yet it is equally important that
we continue to build regular savings programs which mean so
much to our future strength and prosperity. In a sense this
is the sort of period when the value of regular savings in
building adequate financial reserves is brought home to the
average worker more than at any other time.
Neither individuals nor businesses can operate soundly
without reserves; and these reserves can be built only through
the regular setting aside of a portion of Income. It is a
patient, gradual process — a habit that must be built over
a period of time.
The current "Share In America" savings bonds campaign is
an essential part of a long-term program of encouraging more
Americans to save for specific purposes, and to save regularly,
even if it is only a few dollars a week. There are hundreds of
thousands of new workers each year in this country. There
are millions of others who would like to save but "just never
get around to it." It is these groups we are particularly
interested in adding to the rolls of payroll savers.
In an economy such as ours where consumers spend between
$20 and $25 billion per month, a national savings bonds sales
goal averaging less than $1/2 billion per month is obviously
a modest one. Moreover, it must be remembered that the money
that goes into savings does not disappear forever from the
spending stream. In fact, regular saving over the years
produces big spending -- for down payments on new homes, for
college educations for our children, for supplementary income
in retirement years. Yesterday's savings are being spent for
today's needs and luxuries; today's savings will be stimulating
tomorrow's economy through helping to keep business throughout
the Nation at a reasonably high and stable level despite
temporary fluctuations in our free enterprise economy.
Also, in this connection it should be kept in mind that when
people buy bonds they are simply temporarily transferring their
purchasing power to the Government. In the meantime, however,
they are keeping the earning power -- interest which will later
add to the amount of purchasing power that comes back to them
when their bonds mature or are cashed.
While I have talked with you primarily today about Savings
Bonds and debt management, all of us have an awareness of the
constant attention that is being given to our whole economic
posture. While there is not time to go into detail on our
current economic problems, it is most important that we keep
our thinking in due perspective.
We are dealing with a complex and varied mechanism that is
generating about
430 billions of dollars of gross national
product
per
year.
We
generating
in the neighborhood of
$340 billions per yearare
in personal
income.

51
- 6What is the source of this activity? What makes the wheels
turn in this tremendous outpouring of goods and services every
12 months? While the answer can be simply stated, Its
significance for- our present situation is often overlooked.
In our free enterprise system, the source of our economic
power lies in the freedom of both producers and consumers to
make their own decisions -- decisions on markets, decisions
on new products, decisions on purchases, decisions on spending
versus saving, decisions on what the course of the economy
may be in the future. It is these decisions -- the millions
of them which are made every day -- which determine whether
the wheels of our economy will turn at a faster or slower rate.
While we constantly work to achieve a maximum of
productive employment, we must be mindful of the fact that in
a competitive economy we can never guarantee the absence of
fluctuations. The whole march of technological advance,
the shifts in strategy and the defense needs of our country,
the movements of industry, and countless other factors will
always result in change and will require us to make economic
adjustments. While government action can be helpful in providin
an economic climate in which competitive enterprise can
flourish, we must nonetheless recognize that government plays
a secondary role in our kind of an economic system.
In our free enterprise economy, constantly responsive to th
decisions of millions of people In every walk of life, there Is
seldom an occasion when we can cut through the solution of an
economic problem with one short-sharp stroke. Finding the right
answers depends on a long and painful process of studying the
data, comparing judgments, and arriving finally at the best of a
number of possible solutions.
What is required of all of us is that we bring our clearest
thoughts to bear on the issues at hand, and that we do our
utmost to undertake and support whatever actions seem to be in
the best interest of the whole United States now and over the
long-run.
Whatever additional actions on the part of the Government
which may be judged as helpful in assisting an early resumption
of sustainable growth in the economy will be taken.But any actic
which we take must be gauged in the light not only of where we
are today and of the possible effects of any of our activities
in the future.
We must try to do those things which reasonable and prudent
government would do and which would result in confidence. We
must try to avoid those things which reasonable and prudent
government would not do and which would create doubts.

52
-7Above ail else, we must assure that the best and most
competent thought is brought to bear on these problems. It
is this kind of a philosophy which lies at the root of the
understanding,which has been established that decisions
as to what may or may not be done in the field of taxation will
be taken only after bipartisan consultation with Congressional
leaders. Such a course should reasonably avoid competitive
or hasty proposals and should bring to bear on this important
problem the most competent judgment and prudent thought —
in the best interests of all of the American people.
All of us in and out of government must make our separate
contributions to the continuity of confidence in those basic
fundamentals and forces which have brought us to high levels
of production and which can assure a sustainable rate of
growth in the years ahead.
We have a growing, vigorous population. We have a highly
competitive, productive economy. Rapid technological
advances have created new products and processes. Long range
and careful planning is becoming more predominant. All of
these forces are generating new demands and new needs. In
order to satisfy these and like requirements, we must look to
our natural resources, our expanded industrial capacity, our
growing skills, our managerial capacity, and other like
contributors to our productive machinery. When we view our
long-term situation in perspective, therefore, it Is clear
that we have on the one side the expanding needs and wants
of our growing population and on the other side the capacity
and skill for meeting these wants and needs with an expanding
volume of output.
Moreover, we have the two further essentials of continued
high level activity in a free enterprise economy — a
relatively stable currency and an efficient financial system.
What then should be our attitude? I believe that it should
be an attitude of steady-as-we-go, with a tough-minded
confidence in the future. The job that lies ahead for us in
strengthening the sinews of our Nation to meet whatever
challenges the future may bring Is a job for all America —
business, labor, Government, and individuals alike.
As a part of that job, every American who buys a savings
bond, or who puts time and effort into selling savings bonds
to others, can truly say: "I am helping to provide for my
own future. I am adding to the strength of my country, both
military and economic. I am putting real meaning into the
slogan, 'Share in America'."
0O0

y-iM

mmist A. H. raspAiw,
Tuesday. April 8, 1958.

the treasury Department announced last evenly that the tenders fer #1,700,000,01
©r thereabouts* of 91-day treasury bills t® be dated AprU

10 and to mature ^uly 10, :

vhlefe were offered on April 3, were epenei at the Federal Reserve Banks on April ?.
The details of this issue are as fellewsi
fetal applied tor - #2,272,035,000
fetal accepted
- 1,700,195,000

(deludes #293,109,000 entered en a
noncompetitive basis and accepted in
full at the average price shown below)

Bang© ©f accepted competitive bMmt
Blga
Low

- 99*lkQ Equivalent rate ef diseouiit approx. 1.029$ per annua
- 99*720
»
*
•
»
«
1.10$* «
*

Average

- 99*729

•

'1.07JW «

(3li percent of th@ amount bit for at the lew price was accepted)
Vederal leserve
District

fetal
Allied tor

fetal
Accepted

Iteston
lew fork ,
Philadelphia
Cleveland
liehtuond
Atlanta
Chicago
St. Louis
Minneapolis

1
36,081,000
1,572,719,000
3^,880,000
£1*,213,000
lti,li5l,000
39,61*1,000
2?it,706,000
30,003,000
26,295,000
62,873,000
3^,800,000
91,366,000

#
26,001,000
1,066,769,000
23,560,000
50,913,000
!M5l,0G0
39,61*0,000 v
21*9,706,000
30,003,000
f|,985,000
60,233,000
31,1*10,000

#2,272,035,000

11,700,195,000

mmm City
Dalla©
San Frsnelsee
TOTAL

^tl^OO

TREASURY DEPARTMENT
W A S H I N G T O N D.C
ELEiLSE A. M. NEWSPAPERS,
uesday, April 8, 1958.

A-210

The Treasury Department announced last evening that the tenders for $1,700,000,000,
r thereabouts, of 91-day Treasury bills to be dated April 10 and to mature July 10, 1958
hich were offered on April 3, were opened at the Federal Reserve Banks on April 7.
The details of this issue are as follows?
Total applied for - 12,272,035,000
Total accepted
- 1,700,195,000

(includes $293,109,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bidst
High
Low

- 99.1kO Equivalent rate of discount approx. X.029% per annum
w
- 99.720
«
n
w
it
1.108# w
»
- 99*729 » « * n • 1.07W

M M

percent of the amount bid for at the low price was accepted)
Federal Reserve
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

Total
Applied for

Total
Accepted

$ 36,081,000
1,572,719,000
3u,880,000
.. $k, 213,000
il*,l*5i,ooo
39,61*8,000
2?1*,706,000
30,003,000
26,295,000
62,873,000
3l*,800,000
91,366,000

$
26,081,000
1,066,769,000
23,560,000
50,913,000
il*, 1*51, ooo
39,61*8,000
21*9,706,000
30,003,000
25,985,000
60,233,000
31,1*80,000
81,366,000

TOTAL $2,272,035,000

$1,700,195,000

STATUTORY DEBT LIMITATION
AS 0 F

MarchM214oiJ?58

Apr. 8 * 1958
Washington, ...l

<••'

Section 21 of Second Liberty Bond Act, as amended, provides that the face a mount of ^ {f«5*^ ^"f i^jjl iScVgw
of that Act? and thfface amount^ obligations guaranteed as ' 0 « t ^ ^ ^
anteed obligations as may be held by the Secretary of the Treasury), shal not exceed^n theaggregate^ ^
c

(Act of June 26, 1946; U.S.C., title 31, sec. 757b), outstanding at.any one t i m e . . T o r J ^ P " e ^ J ^ J , option of the holder
demotion value 'of any' obligation issued on a aiacount b . « j W h * c h « « f t " " ^ J » $ ^ C o n ^ r e s s provides that during the
shafi be considered as its fe« • » « £ . » jThe Act ^ ^ 9 5 ^ ^ a b o v e 1 mitation («275,00ofo00,000) shall be temporarily
period beginning on February 26, 1958 and ending June }u, LSJS,
increased by $5,000,000,000.
„u:«l. <.<.« of ill be issued under
The following table shows the face amount of obligations outstanding and the face amount which can still be issued
this limitation: $280,000,000,000
Total face amount that may be outstanding at any one time
OutstandingObligations issued under Second Liberty Bond Act, as amended
Interest-bearing:
Treasury bill,
Certificates of indebtedness.
Treasury note

123.022'321.000
31,478,321,000
„.„,..-, „ „
« > . < » > . S W . 0 0 0 I 75,185,151.000

^Iry 87.662,9*2,750
• Savings (current redemp. value)
Depositary.....
Investment series
Special FundsCertificates of indebtedness
Treasury notes.

$2.5*»091»250
148.495.500
9.836,909>000

149,902,438,500

29,616,219,000
12,731,764,000

T«

r - ^.*».«» -i:llli5:S

Total interest-bearing
Bearing no
interest:
Matured,
interest-ceased
United States Savings Stamps
Excess profits tax refund bonds
Special notes of the United States:
Internat'l Monetary Fund series
Total

49,882,951
895,07**

^72 289 4 3 1
3(&*--V7f
J

669.000.000 719.778.025
272,190,139,956

Guaranteed obligations (not held by Treasury):
Interest-bearing:
103.233,200
Debentures: F.H.A
726,375
Matured, interest-ceased
Grand total outstanding
Balance face amount of obligations issuable under above authority,

103,959,575
?7?.t294.099.531
7,705,900,469

M a r c h 3 1 * 19*58
Reconcilement with Statement of the Public Debt.....t.^.„"..^±?....M.'f.^:.

(Date)
(Daily Statement of the United States Treasury, !?a.?S,!?...2i.F....i251?. )
(Date)
OutstandingTotal gross public debt
Guaranteed obligations not owned by the Treasury.
Total gross public debt and guaranteed obligations.
Deduct - other outstanding public debt obligations not subject to debt limitation

A-211

272,624,225.527
103.959,575.
272,728,185,102
434.085.571
272,294,099,531

STATUTORY DEBT LIMITATION

AS OF.. ^ch--2;U .1?58

easea ay };,yuu,wu,wui

The following table shows tbe face amount of obligations outstanding and the face amount which can still be issued under
this limitation:
$280,000,000,000
Total face amount that may be outstanding at any one time
OutstandingObligations issued under Second Liberty Bond Act, as amended
Interest-bearing:
Treasury bills
Certificates of indebtedness
Treasury notes
BondsTreasury
* Savings (current redemp. value)
Depositary.....
Investment series
Special FundsCertificates of indebtedness
Treasury notes
Treasury bonds
Total interest-bearing
Matured, interest-ceased
Bearing no interest:
United States Savings Stamps
Excess profits tax refund bonds
Special notes of the United States:
Internat'l Monetary Fund series
Total

S 23,022,321,000
31.^78,321,000
20.684.509.000 $ 75,185,151,000
87,662,9^2,750
52,25^,091.250
148,495.500
9,836,909,000
29.616,219,000
12,731.764,000
3.462.500.000

149.902,438,500

k,,810 t 4 8 ? t 0 0 0
270,898,072,500
5/2,2o9,*r^X

49,882,951
895.074
669.000.00Q

719.778.025
272,190,139.956

Guaranteed obligations (not held by Treasury):
Interest-bearing:
103,233.200
Debentures: F.H.A
726.375
Matured, interesl-ceased
Grand total outstanding ,.
Balance face amount of obligations issuable under above authority,

103.959.575

Reconcilement with Statement of the Public Debt

?72.294.099.531
7,705.900,469

^™i..2i.?...i2§5
(Date)

(Dally Statement of the United States Treasury,

?!*£!?.!?..,r&.?.,A???.?.
{Date)

OutstandingTotal groNS public debt
Guaranteed obligations not owned by the Treasury.
Total gross public debt and guaranteed obligations.
Drduct - other outstanding public debt obligations not subject to Hebt limitation

A-211

)

272,624,225.527
103.959.575
272,728,185.102
434.085.571
272,294,099.531

- 3 XSSSK
or by any local taxing authority. For purposes of taxation the amount of discoi
at which Treasury bills are originally sold by the United States is considered i
be interest. Under Sections li5ii (b) and 1221 (5) of the Internal Revenue Code c
195h the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed c
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereund
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 1*18, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copie
of the circular may be obtained from any Federal Reserve Bank or Branch*

2 -

2 percent of the face amount of Treasury bills applied for, unless the tenders a:

accompanied by an express guaranty of payment by an incorporated bank or trus
company.
Immediately after the closing hour, tenders will be opened at the Federal R<

serve Banks and Branches, following which public announcement will be made by

Treasury Department of the amount and price range of accepted bids. Those sub
mitting tenders will be advised of the acceptance or rejection thereof. The

Secretary of the Treasury expressly reserves the right to accept or reject an

all tenders, in whole or in part, and his action in any such respect shall be
final. Subject to these reservations, noncompetitive tenders for $200,000 or

without stated price from any one bidder will be accepted in full at the aver

price (in three decimals) of accepted competitive bids. Settlement for accept
tenders in accordance with the bids must be made or completed at the Federal
serve Bank on April 17. 1958 , in cash or other immediately available funds
or in a like face amount of Treasury bills maturing April 17, 1958 Cash

sale or other disposition of the bills, does not have any exemption, as such,
loss from the sale or other disposition of Treasury bills does not have any

special treatment, as such, under the Internal Revenue Code of 1954. The bill

are subject to estate, inheritance, gift or other excise taxes, whether Feder

or State, but are exempt from all taxation now or hereafter imposed on the pr

or interest thereof by any State, or any of the possessions of the United Sta

XKKHX
TREASURY DEPARTMENT
Washington

\
,~\
y\ ^ r

A. M.
RHK RELEASE/ HBHKXKK NEWSPAPERS,
Thursday, April 10, 1958

55
The Treasury Department, by this public notice, invites tenders for
$ 1,700,000,000 , or thereabouts, of
in exchange for Treasury bills maturing

-day Treasury bills, for cash and

April 17, 1958

, in the amount oJ

$ 1,700,648,000 , to be issued on a discount basis under competitive and non-

m—
competitive bidding as hereinafter provided.
dated April 17, 1958
, and will mature

The bills of this series will be
July 17, 1958
w hen the face

—:—m

amount will be payable without interest. They will be issued in bearer form onlj
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $l,OO0,0C
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
closing hour,/6tooo o'clock p.m., Eastern Standard time, Monday, April 14, 1958
Tenders will not be received at the Treasury Department, Washington. Each tendei
must be for an even multiple of $1,000, and in the case of competitive tenders
the price offered must be expressed on the basis of 100, with not more than three
decimals, e. g.9 99.925. Fractions may not be used.

It is urged that tenders

Tenders will be received without deposit from

incorporated banks and trust companies and from responsible and recognized dealei
in investment securities. Tenders from others must be accompanied by payment of

RELEASE A.M. NEWSPAPERS,
Thursday, April 10, 1958.

A-212

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91 -day Treasury bills, for
cash and in exchange for Treasury bills maturing April 17, 1958
in the amount of $1,700,648,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated April 17, 1958,
and will mature July 17, 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Standard time,
Monday, April 14, 1958.
Tenders will not be received at the
Treasury Department, Washington. Each tender must be for an even
multiple of $1,000, and in the case of competitive tenders the price
offered must be expressed on the basis of 100, with not more than
three decimals, e. g., 99.925. Fractions may not be used. It is
urged that tenders be made on the printed forms and forwarded in the
special envelopes which will be supplied by Federal Reserve Banks or
Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from Incorporated banks and trust companies and from
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or in part, and his action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
$200,000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders in accordance
v;ith tbe bids must be made or completed at the Federal Reserve Bank
on April 17, IS58,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing April 17, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments villi be made for differences between the par value of
riaturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 195^* The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
cr State, but are exempt from all taxation now or hereafter imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 195^ the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
omer of Treasury bills (other than life insurance ccnpanies)
issued hereunder need include in his incone tax return only the
difference between the price paid for such bills, whether on
original issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

oOo

• 5-

m m m&rttfatartorn*mmmMltm ifcMi jrw maximm *m
Am- A%* *n*Ummm\ mi m® 0m.. *0OTtt*0gr# you my viah
tm ®mMm? m «&*mftttv»^mmmAm Mm yMkto*mmmmt mmtom^ mt
UmUm mt Hi* immmmm mmm-Am \M®b will
& tki* m m * , nn Mfp«fc torn J**» ^ s m M f r ; ^lficdtion of
41* pp©s«st £** * M « & ^111 lnmm&® mm portion mi iov*etss©ai
subject te U x to mm®® mm tMrnmAf vith the pr*v»Xliiig
of if^s&t&snt lii$&$e &IKJVJ& r&qvdurmi- ifit@r*#4 f<
4-dch a u g t a Is m ^ ^ 1 3§ p«mtft for mm
tion for intent gpNiia inU. clc^r Hoc vdth the <mrr«it *itttstioa,
but ^ICIUM also b# iwMit«i9& to future mttw^m Am
tiom tmm ymr to y ^ r . Oi*ddtfwfcIa* asfemiia m given 4© »
4te& m^msttt i^l* u$f ffgy8Hg,lfli1i.

A wmmm m®m$£$mtm$m mi m* p w « $ & temm&& -mtbA&b
%m fidgfet 3o.&sl*t@r i® im» ^ i # i wsuki fugmgr*! • mm
m timm zmptmim with relatival/ a m l l «^m«t© of

Ammm m& mmtmtiml mr&A&g® irm A**mmmm or m$mmmimm$
mwm*9 mm mtimly mm^t §mm U^tis^n. If Is g ^ ^ M %M%
%\%U ^it b® m*M *m®mm bf K M mt a ^Mmm *m provision,
^hieh n@nM t^uir* t^t 4ti@ %m mbmM m% h* Am* mm the lisM U $ r c<sspy t&d m% m>mmA* m*i$mm%® Its mfom mm m mmitAm4 pro' mi mm mm p im*Amf
n r: ra»3jfrf%|ii
^ m****M*mm
«!«&*•*••
ffltilUftmMm
§g|^ 1 #t&llcy
# H & § fflffitM
HH

I 4fcl» nm agm Xmmm mmm mttoisgUt* imwmmm %m**
mmi&Amm mm mrim mi tmgmmy f«w34ia mi fulfill *

Bmmftmvy of mm
^oy>rm..± mmm
®f BmprmmUtte'm
A3$ H. Cm

DTSmith/BALindsayimlo

V9/5a

. -ilia

-4-

& ear sU&imo mm
able by mm life iasara^ * » » w , f
poeelfele idjuutawcta la f»U*y w w r r m e H rel»t*d 14*** ffer ten
purpoe**. S » objective of m*b •gJtafeMefcft neal* be to 4*k*
off or la soaa ^ M 4S neutralise, 4fe* mttmmt mi different
of reserve •*&*&*&» v*r?lag reserve lfttareet iiamifjtlftM, s**4
^ bmMmm that tlier* Is «»i*tej&tial aerlt ia «a «3jwfeeeet f w
with reserves &***£ on * p
ation. 3*sch «s *iju»ts£At mmM ********** tor mm fact 4fc*4 la
to reserves on mm bwAmm im the firet pciiagr yeer 1*
for m ommmwL? v&i& mm
mUsm is eat %fcicb ? m M Uko ^oimt of 4*fleiefigf reserve* la
estates** on tfrs «ffeetiv* del* of U * so&sst ad plea*
isewlsfest terete, *** is 4ii* li^fat ta*ir
lftto Ktrplnm msM

,
** f^lT saere thet problem mlmt with rseses* to
tiwi pUc ju£t il*e***e£* It tgin, of eesy**, lasree** 4a* mm p*M
im
\f^Tm.^m^m9
* m ** 1f4JU" ******* ©4e*r*t reealttaf im
sstft* ia bmmmm m* eeeperei with tea tffeseat *tota*mz> mthod v**«
A* l^viUclfe ^ a sfet*** fres a *** ***** m
mTSm*mm**mm
^.Vf*
5 5 ^ * 2 * • *55*_?1 *aOHAej4 earns!**, A*.
-fela* i i ^ t ^ c *W*»4«s aetfcaj a*r rseali i T *
4© pel i^r reeetvee in order 4*
jt

63
- 3Mm suggest that the starting point for measuring the net earn*
lag® should be the figure for *Het Gain Fro* ©Derations After
Dividends to Policyholders* which appears in each company*s annual
statement to the State insurance departments and whieh summarizes
the operating results for the year* this figure is based on ear**
fully developed life insurance accounting practices which have
general acceptance in the industry. Adjustments, such as those
for tax-exempt interest, federal income taxes paid, and depreciation
on the insurance business property account, would conform it with
general rules for computing taxable income.
fhe resulting tax base would include the margin of investment
income above amounts needed on policy reserves, gain from better
than assumed mortality experience, and profit arising from the difference between the expense "loading" portion of premiums and actual
expenses* Deductions would be allowed for all dividends paid to
policyholders and amounts added to policy reserves*
Under this suggested method, life insurance companies would
be entitled to net operating loss carryovers* To assure the best
possible long-range measurement of life insurance company earnings
and to preclude taxing annual amounts whieh are not true net earnings because of uneven experience, a longer loss carryback provision should be provided for life insurance companies than for other
corporations, ranging up to 10 or 20 years*
Consideration may also need to be given to some kind of special
allowance or relief feature for small and new companies. Such a
provision might be designed to recognise the special problems of the
growing company* For example, a deduction might be allowed of 50
percent, or some other fraction, of amounts up to some specified
amount retained by a company as contingency reserves for the protection of policyholders.
Provision should be made for a gradual transition to the new
method over a three to five-year period. During this transition,
the tax would be computed as a weighted average of the tax under the
new method and the tax under the present stopgap method, with gradually increasing weight to the new method*
The taxation of life insurance companies inevitably raises the
question of its possible impact on policyholder savings, benefits,
and insurance costs* The tax base discussed above would exclude all
amounts paid to, or set aside irrevocably for the benefit of any
policyholder or group of policyholders* It would exempt additions
to policy reserves including interest thereon; all cash insurance
benefits made available to policyholders or their beneficiaries;
and all policy dividends or similar rebates paid or refunded to
policyholders.

-a-

I*t# in 1954 ertmwive stud to
by
* M^a*a£tiss
of Vmlaw*
my% and
adoption
of the present
$s£s pr^videe1 a reserve sad other
policy M * M M % s^isatlaa af t # p i ^ m m* first #1 ai&*
lion afM®*t********
iavaa^aaat
sad %m
49 *mm*m
aat la********
m isaaas
mMMmm.
$m 1*Mm mtm
%wmmm*:
t*Ja strustuml improvements, l ^ « i a g a la^aylima^^
m\mwm9*tvmmft&*%m .iSfcttOOBwl S M P i ^

^ M 8 S ^mfmm^rmi^tmNmS.. w »

Wwm*»mm".

*m*''(MPVItfa W * *

™

a^e aas*i*te treatment of the health
Ufa
Hi* 1955 foraaO* na* ori^iaal V «*#* applicable 4a 1955
<*0y, subj act to the provision
4s* \*m imm&m* mmM
• that>m*%mf
Am mm /ear if taars mm not *a evasion.
W
for^i* -^0 subsequently « x U w M to lfg$ ami mm m**
t0
aaatlf 1OT
mimmMm

mmmm^mtm m^mXmmi Am mm
wdL4l& t h s ^f*jftftiP|*<ii^Biaal tair

staffs, mm* torn a coxtedder^le period is 3 M I a m 1956 in
tfetioo with * group af distiagulshetl aetaeriee %tmm
mm anOetta by 4®* life iaswaaaa Ie*a*r **> *&*
uhlle taa %t^mlitml asalataaa* of these aatatrlaa Mm bmm tsvalim the poliey suggestion* %Mmb fcstve bmm d*v*iep*4 fras it*
On 4a* bftsis of our reviev m*t sU*Iy , it ***** ^ld«at that
tr* •attsia iaai**j«*i*a in the present method *i
life
it atUi*** *a averaging * p H a % n^peir flat
a life immmm
mmmrny %* mmmmd by
stasia*! af iatarast aeOttetions. mt %w torn
mt mm individual etsga,
tsmtiaa 4* whi*U it 1* *agg*st*i the ®®aa£tts* ftv* first
sratta \m*iU provide * i*a§*§*g£sj* uusis af Wx&tioa tor life
tdta that of ataa*
^^^P*^*pftSw- w w eNns*PM*pHpliPi*- %a>* w^p^pwapaNp

tHe f a n sat *afftlafs mt life Sam**** cc^e/ii«e. It
available 4a g^li^flyfl^fif*.

%y dear Hr. ChairmanJ
In oar letter t© yau af January 10 concerning temporary
legislation for the taxation of life insurance companies, the
Treasury indicated that 14 would propose a method far aar* p*mm~
a*at legislation la this field, la accordaae* vita this and subs
quest statements made in the public hearings of the House my* a*
Means Cemaitt** an various tax legislative aatters Janaary 16, as
before mm Senate Finance Committee oa the 'stopgap* extension
legislation M a m a 5, tsar* are submitted far your consideration
suggested approaches to the taxation of life insurance companies.
In developing thee© recommendations far * more permanent basis
of taxation, w* have approached the task with full recognition of
the difficulties in this ccaplieated area, which stem in part from
the complex nature *t the AAt* insurance business a* conducted as
the level premium basis. t& are also aware of the fast that wa are
dealing with institutions which are the custodians of the life insurance protection and savings of millions of American families.
Tbe problem mt developing a satisfactory long-range basis of
taxation for the life insurance industry 1* mat a new one. The
problem ha* resisted golntlfm since 1947 when the then applicable
formula, adopted in XW*9 resulted in no tax whatsoever oa the life
insurance business, sad was replaced by * saris* of stopgap formulas.
lou are familiar vith the resulting extensive legislative history la
this area and the long stagy which has boon given 4a the question by
your Committee sad tbe Congress ovar tea** year*.
A Subcommittee of the Ways sad mmm Caaaitt** oa the Taxation
of U f e Insurance Companies waa established in 1949 which conducted
studies sad recommended stopgap legislation, deferring * permanent
solution of the problem to * later date* the temporary legislation
subsequently adopted, termed the 1950 formula, was applied only 4*
1949 sad 1950 income.
la 1951 further stopgap legislation was asacted, converting 4a*
reserve sad other policy liability deduction under the 1990 formula
Into * reduced rat* of tax on net investment income without deduction
for required interest, fbe 1951 method waa extended from year to
year through 1954.

TREASURY DEPARTMENT

WASHINGTON, D.C.
IMMEDIATE RELEASE,
-Friday,-January 10, 1958.

3/~?
'mwm**

A-

Treasury Secretary Anderson today sent the following letter to
Senator Harry F. Byrd, Chairman of the Senate Finance Committee, and
Representative Wilbur D. Mills, Chairman of the Kouse Ways and Means
Committee:
January"n^7~T956^
My dear Mr. Chairman;

TREASURY DEPARTMENT
WASHINGTON, D.C.
IMMEDIATE RELEASE, _ A-213
Friday, April 11, 1
Trsasury Secretary Anderson today sent the following letter to
Senator Harry F. Byrd, Chairman of the Senate Finance Committee, and
Representative Wilbur D. Mills, Chairman of the House Ways and
Means Committee:
April 10, 1958
My dear Mr. Chairman:
In our letter to you of January 10 concerning temporary
legislation for the taxation of life insurance companies, the
Treasury indicated that it would propose a method for more
permanent legislation in this field. In accordance with
this and subsequent statements made in the public hearings
of the House Ways and Means Committee on various tax
legislative matters January 16, and before the Senate
Finance Committee on the "stopgap" extension legislation
March 5, there are submitted for your consideration
suggested approaches to the taxation of life insurance
companies.
In developing these recommendations for a more
permanent basis of taxation, we have approached the task
with full recognition of the difficulties in this
complicated area, which stem in part from the complex
nature of the life insurance business as conducted on
the level premium basis. We are also aware of the fact
that we are dealing with institutions which are the
custodians of the life insurance protection and savings
of millions of American families.
The problem of developing a satisfactory long-range
basis of taxation for the life insurance industry is not
a new one. The problem has resisted solution since 19^7
when the then applicable formula, adopted in 1942,
resulted in no tax whatsoever on the life insurance
business, and was replaced by a series of stopgap
formulas. You are familiar with the resulting extensive
legislative history in this area and the long study which
has been given to the question by your Committee and the
Congress over these years.
A Subcommittee of the Ways and Means Committee on the
Taxation of Life Insurance Companies was established in
19^9 which conducted studies and recommended stopgap

68
- 2 ~
legislation, deferring a permanent solution of the problem
to a later date. The temporary legislation subsequently
adopted, termed the 1950 formula, was applied only to
1949 and 1950 income.
In 1951 further stopgap legislation was enacted,
converting the reserve and other policy liability
deduction under the 1950 formula into a reduced rate of
tax on net investment income without deduction for
required interest. The 1951 method was extended from
year to year through 1954.
Late in 1954 extensive studies and hearings were conducted
by a Subcommittee of the Ways and Means Committee, leading to
the adoption of the present law. This provided a reserve
and other policy liability deduction of 87-I/2 percent on
the first $1 million of net investment income and 85 percent
on net investment income in excess of $1 million. The 1955
law also provided certain structural improvements, including
a broadening of the net investment income base, the
correction of certain abuses, and a more adequate treatment
of the health and accident business of life insurance
companies.
The 1955 formula was originally made applicable to
1955 income only, subject to the provision that the 1942
formula would reapply automatically in any year if there
were not an extension. The 1955 formula was subsequently
extended to 1956 and more recently to 1957 income.
The Treasury has reviewed carefully the facts, issues
and alternative approaches developed in the course of these
past deliberations. You are cognizant of the staff work
which the Department has conducted cooperatively with the
Congressional tax staffs, and for a considerable period in
1955 and 1956 in consultation with a group of distinguished
actuaries whose services were made available by the life
insurance industry to the Treasury. While the technical
assistance of these actuaries has been invaluable to our
work, they do not, of course, have any responsibility for
the policy suggestions which have been developed from it.
On the basis of our review and study, it seems evident
that there are certain inadequacies in the present method
of taxing life insurance companies. The present method
does not recognize sources of net income other than
investment income. Furthermore, it utilizes an averaging
system, whereby the net taxable income of a life insurance
company is measured by reference to an arbitrary or
industry-wide standard of interest deductions, not by the
actual
company.
experience and requirements of the individual

- 3Two possible solutions are presented herewith. The
method of taxation to which it is suggested the
Committee give first consideration would provide a longrange basis of taxation for life insurance companies
bringing their taxable income concept into closer
conformity with that of other corporate business. Such
a concept should be designed to reflect, to the fullest
extent practicable, the full net earnings of life
insurance companies. It should at the same time provide
comprehensive deductions for all expenses, interest, and
reserve requirements, and all amounts paid or made
available to policyholders.
We suggest that the starting point for measuring the
net earnings should be the figure for "Net Gain From
Operations After Dividends to Policyholders" which
appears in each company's annual statement to the State
insurance departments and which summarizes the operating
results for the year. This figure is based on carefully
developed life insurance accounting practices which have
general acceptance in the industry. Adjustments, such
as those for tax-exempt interest, Federal income taxes
paid, and depreciation on the insurance business property
account, would conform it with general rules for computing
taxable income.
The resulting tax base would include the margin of
investment income above amounts needed on policy
reserves, gain from better than assumed mortality
experience, and profit arising from the difference
between the expense "loading" portion of premiums and
actual expenses. Deductions would be allowed for all
dividends paid to policyholders and amounts added to
policy reserves.
Under this suggested method, life insurance companies
would be entitled to net operating loss carryovers. To
assure the best possible long-range measurement of life
insurance company earnings and to preclude taxing annual
amounts which are not true net earnings because of uneven
experience, a longer loss carryback provision should be
provided for life insurance companies than for other
corporations, ranging up to 10 or 20 years.
Consideration may also need to be given to some kind
of special allowance or relief feature for small and new
companies. Such a provision might be designed to
recognize the special problems of the growing company.
For example, a deduction might be allowed of 50 percent,
or some
other fraction,
of amounts
up to some
specified
amount
the
protection
retained
of
bypolicyholders*
a company
as contingency
reserves
for

- 4-

7 M

Provision should be made for a gradual transition to
the new method over a three to five-year period. During
this transition, the tax would be computed as a weighted
average of the tax under the new method and the tax
under the present stopgap method, with gradually increasing weight to the new method.
The taxation of life insurance companies inevitably
raises the question of its possible impact on policyholder
savings, benefits, and insurance costs; The tax base
discussed above would exclude all amounts paid to, or
set aside irrevocably for the benefit of any policyholder
or group of policyholders. It would exempt additions
to policy reserves including interest thereon; all cash
insurance benefits made available tp policyholders or
their beneficiaries; and all policy dividends or similar
rebates paid or refunded to policyholders.
In our studies and discussions with the consultants
made available by the life insurance industry, we have
given attention to possible adjustments in policy
reserves and related items for tax purposes. The
objective of such adjustments would be to take account
of, or in some cases to neutralize, the effect of
different methods of reserve valuation, varying reserve
interest assumptions, past and future reserve strengthening
operations, and certain other factors.
We believe that there is substantial merit in an
adjustment for companies with reserves based on a
preliminary term method of valuation. Such an adjustment
would compensate for the fact that in the case of a
company using a preliminary term method the addition
to reserves on new business in the first policy year is
substantially smaller than for a company which uses the
net level premium valuation method.
Another adjustment which appears to deserve favorable
consideration is one which would take account of deficiency
reserves in existence on the effective date of the
suggested plan. These particular reserves may be considered equivalent to an allocation of previously
accumulated surplus, and in this light their recovery back
into surplus would not constitute current earnings which
should be subject to tax.
At this time we have no recommendations for or against
other specific reserve adjustments. We recognize, however,
that other possible refinements and modifications, including
contingency reserves, adjustments for reserve strengthening,
and special allowances for some segment of surplus, merit

-5-

. ^ 1

further review in the light of the expert views and comments
of members of the life insurance industry which will be
made available in the course of your future deliberations.
However, every departure from the allowance for policy
reserves used in determining the net gain from operations
reported in the annual statement to the State insurance
departments would represent a complication which could
be justified only by persuasive equity and technical
considerations.
The Treasury is fully aware that problems exist with
respect to the plan just discussed. It will, of course,
increase the tax paid by some companies, just as it will
relieve others, resulting in shifts in burden as compared
with the present stopgap method. This is inevitable in
a change from a tax based on $.n industry-wide formula to
a tax based on the income of individual companies.
Another problem is that the suggested method may result
in a changed approach to policy reserves in order to
reduce or eliminate tax.
We do not minimize the difficulties which your
Committee may encounter in its evaluation of the plan.
Accordingly, you may wish to consider an alternative more
in line with the present method of taxation of life
insurance companies which will nevertheless make tangible
improvements.
In this event, we suggest that you consider
modification of the present law which will increase the
portion of investment income subject to tax to accord
more closely with the prevailing margin of investment
income above required interest for policyholders, which
margin is now about 30 percent for the industry as a whole.
Such a revised formula should not only bring the deduction
for interest needs into closer line with the current
situation, but should also be responsive to future changes
in industry conditions from year to year. Consideration
should be given to a further refinement of the present
type of special interest deduction for companies with
substantially less than the average margin of investment
income,
A second modification of the present formula which
the Committee might consider is one which would assure a
more reasonable tax on those companies with relatively
small amounts of investment income and substantial
earnings from insurance or underwriting sources, now
entirely exempt from taxation. It is suggested that
this might be made effective by means of a minimum tax
provision, which would require that the tax should not

{ mm.

- 6be less than the liability computed at regular corporate
tax rates on a specified proportion of the net gain
from operations after policy dividends.
Whatever tax formula is applied to the ordinary
income of life insurance companies, their capital gains
and losses should no longer be disregarded for tax
purposes,
A fair and more lasting method of taxing life
insurance companies to replace the series of temporary
formulas will fulfill a long-standing need in our tax
structure.
Sincerely yours,
/ s / Robert B, Anderson
Secretary of the Treasury

oOo

f] -XI ^
mW*MDlimmm RELEASE,
Wednesday, April 9, 1 9 3 .
The Treasury today announced a 24 percent allotment oa subscriptions in excess of $85,000 tor the current cash offering ©f $5-1/2
billion of 2-5/8 percent treasury Botes of Series A-1963. Subscriptions
tor $35,000 or less vill be allotted in full. Subscriptions far iaore
than $25,000 will be allotted not less than $£5,000•
In addition to the amount allotted to the public, $100 ailliaa of
these notes will be allotted to Government Investment Accounts.
Reports received thus far from the Federal Reserve Banks show that
subscriptions total about $15,750 Million,

details by federal Reserve

i&etriets as to subscriptions and allotments will be announced when
final reports are received from the Federal Reserve Banks.

TREASURY DEPARTMENT
WASHINGTON, D.C. N ^ V ^
IMMEDIATE RELEASE,
Wednesday, April 9, 1958.

A-214

The Treasury today announced a 24 percent allotment on subscriptions in excess of $25,000 for the current cash offering of $3-1/2
billion of 2-5/8 percent Treasury Notes of Series A-1963. Subscriptions
for $25,000 or less will be allotted in'full. Subscriptions for more
than $25,000 will be allotted not less than $25,000.
In addition to the amount allotted to the public, $100 million of
these notes will be allotted to Government Investment Accounts.
Reports received thus far from the Federal Reserve Banks show that
subscriptions total about $15,730 million. Details by Federal Reserve
Districts as to subscriptions and allotments will be announced when
final reports are received from the Federal Reserve Banks.

mQf

COTTON WASTES
(In pounds)
CC

wT2SB.C^S3SSS ma<le from Cotton havln«"* staple of less than 1-3/16 inches in length, COMBER
?™XU^
> *SLIVER W A S T E > AND R 0 V I N G W A S T E > WHETHER OR NOT MANUFACTURED OR OTHERWISE
ADVANCED W VALUE* Provided, however, that not more than 33-1/3 percent of the quotas shall
be filled by cotton wastes other than comber wastes made from cottons of 1-3/16 inches or more
q ^ + ™ i ! " *enif5 ^ t h t ° a s e of the f o l l ™ i n $ countries: United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany, and Italys
'
Established
Total Imports
Established g
Imports
Country of Origin
TOTAL QUOTA
Sept. 20, 1957, to
33-l/3# of : Sept. 20, 19 57,
April 8>;1QS8
Total Quota ; to April 8. 1Q58
United Kingdom . . . . . 4,323,457
1,441,152
875,113
875,113
Canada
....
239,690
239,690
75,807
France . . . . . . . . ..
227,420
^7,319
British India . . . . . .
69,627
22,747
Netherlands . . . . . . .
68,240
14,796
Switzerland . . . . . . . .
44,388
12,853
Belgium
38,559
^pan
.
341,535
China . . . . . . . . . .
17,322
E
6TPt
8,135
11,134
25,443
11,134
Cuba . . . . • » • • • .
6,544
6,?ig
-..7.088,,
6»91?
Germany
76,329
5,482,509
1,180,171
1,599,886
893,162
Italy
.
21.263

1/ Included in total imports, column 2,
Prepared in the Bureau of Customs.

TREASURY DEPARTMENT
Washington
IMMEDIATE RELEASE,
•Thursday. ^r r i l 1 Q ' 1 9 5 '

"215

Preliminary data on imports for consumption of cotton and cotton waste chargeable' to the quotas
established by the Presidents Proclamation of September 5, 1939, as amended

--4

COTTON (other than linters) (in pounds)
Cotton under 1-1/8 inches other than rough or harsh under 3/4"
Imports Sept. 20, 1957, to April 8, 1958
Country of Origin, Established Quota Imports Country of Origin Established Quota
Egypt and the Anglo- Honduras ..... . 752
Egyptian Sudan . . *
783,816
Peru
247,952
British India . . . . .
2,003,483
China
1,370,791
Mexico . . . . . . . .
8,883,259
Brazil . . . . . . . .
618,723
Union of Soviet
Socialist Republics •
475,124
Argentina
5,203
Haiti
237
Ecuador
9,333

7,296
8,883,259
600,000
-.
-

Paraguay . . . . . . . .
Colombia . . . . . . .
Iraq . . . . . . . . .
British East Africa . .
Netherlands E. Indies.
Barbados
l/Other British W. Indies
Nigeria
.
2/0ther British W. Africa
^Other French Africa . .
Algeria and Tunisia .

Imports
871
124
195
2,240
71,388
21,321
5 377
16*004
689

1/ Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
2/ Other than Gold Coast and Nigeria.
,2/ Other than Algeria, Tunisia, and Madagascar.
-"•^fiifa 3Fi^ftSP^—-&*~- -' J - Cotton 1-1/8" or more . .
—.£*5<KBte^4u-^L***^-__ _~fcJ

Imports August l, 1057. to Dec. 31. 1957. incl.

TIIIll^^a^BBaggA^. y - flU—ii Established Quota (Global) Imports
45,656,420 45,656,420

IMMEDIATE RELEASE,
Thursdayr April 10. 195o.

TREASURY DEPARTMENT
Washington
A-215

Preliminary data on imports for consumption of cotton and cotton waste chargeable to the quotas
established by the President'^- Proclamation of September 5, 1939, as amended
COTTON (other than linters) (in pounds)
Cotton under 1-1/8 inches other than rough or harsh under 3/4"
Imports Sept. 20. 1957, to April 8, 1958
Country of Origin
Established Quota
Imports
Country of Origin
Egypt and the AngloEgyptian Sudan . .
Peru
........
British India . . . .
China
.
Mexico . . . . . . .
Brazil . . . . . . .
Union of Soviet
Socialist Republics
Argentina
Haiti
Ecuador • .
. . . .

783,816
247,952
2,003,483
1,370,791
8,883,259
618,723
475^124
\5,203
237
9,333

Honduras 9 * . .
Paraguay . ......
Colombia

7,296

+rsq . . . . . . . .

8,883,259
600,000

British East Africa . .
Netherlands E. Indies.
Barbados
.
l/0ther British W. Indies
Nigeria . . . . . .
2/0ther British W. Africa
J/Other French Africa . .
Algeria and Tunisia .

Established Quota
752
871
124
195
2,240
71,388
21,321
5,377
16,004
689

1/ Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
2/ Other than Gold Coast and Nigeria.
,2/ Other than Algeria, Tunisia, and Madagascar.
Cotton 1-1/8" or more
Imports August X. 1<&? to Dec. 31. 1957. incl.
Established Quota (Global) Imports
^5,656,420

^5,656,420

COTTON WASTES
(In pounds)
COTTON CARD STRIPS made-from cotton having a. staple-of less than 1-3/16 inches in length, COMBER
WASTE, LAP WASTE, SLIVER WASTE, AND ROVING 7JAS3E, WHETHER OR NOT MANUFACTURED OR OTHERWISE
ADVANCED IN VALUE. Provided, however, that not more than -33-1/3 percent of the quotas shall
be filled by cotton wastes other than comber wastes made from cottons of 1-3/16 inches or more
"in staple length in the- case- of the- following-countriess United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany, and Italys

Country of Origin

Established.
TOTAL QUOTA

Total.Imports
Sept. 20, 1957, to
_Mzil 3, 1958

Established
33-1/35* of
Total Quota
1,441,152

Imports
Sept. 20, 19 57,
to April 8. 1958
875,113

United Kingdom . •
4,323,457
. 9
Canada .
239,690
•
e » o «. *
France . * e o o « • . o
227,420
British India. . . . a e .
69>627
Netherlands . . . . ..- . .
68,240
Switzerland . . . . ...
44,388
Belgium • • • • • • ...
38,559
Japan . . . . . .. ....
3 a , 535
China . . . . . . . ...
17,322
...
Egypt . . ,
8,135
Cuba o . .
6,544
Germany . .
76,329
Italy . . .
21,263

875,H3
239,690

11,13^
6,915

25,443
7.088

11,134

5,482,509

1,180,171

1,599,886

893,162

if Included in total imports, column 2.
Prepared in the Bureau of Customs.

75,807

^7,319
22,747
14,796
12,853

6,9i5

TREASURY DEPARTMENT
Washington

IMMEDIATE RELEASE,
Thursday. April 1011958,

A-216

The Bureau of Customs announced today the following preliminary
figures showing the imports for consumption from January 1, 1958, to
March 29, 1958, inclusive, of commodities for which quotas were
established pursuant to the Philippine Trade Agreement Revision Act
of 1955:

Commodity

: Established Annual
:
Quota Quantity

Buttons

807,500

Unit of : Imports as of
Quantity: Mar. 29, 1958
Gross

148,111

Cigars 190,000,000

Number

Coconut oil 425,600,000

Pound

45,420,186

Cordage 6,000,000

Pound

937,239

(Refined
Sugars
(Unrefined ....
Tobacco 6,175,000

1,102,940

3,694,860
1,904,000,000

Pound
380,747,439
Pound

835,095

7Q
TREASURY DEPARTMENT
Washington

IMMEDIATE RELEASE,
Thursday, April 10V 195.9•

A-216

The Bureau of Customs announced today the following preliminary
figures shoving the imports for consumption from January 1, 1958, to
March 29, 1958, inclusive, of commodities for which quotas were
established pursuant to the Philippine Trade Agreement Revision Act
of 1955:

Commodity

Established Annual : Unit of
Quota Quantity
: Quantity:

Buttons

807,500

Gross

Imports as of
Mar. 29, 1958
148,111

Cigars 190,000,000

Number

Coconut oil 425,600,000

Pound

45,420,186

Cordage 6,000,000

Pound

937,239

(Refined
Sugars
(Unrefined ....
Tobacco 6,175,000

1,102,940

3,694,860
1,904,000,000

Pound
380,747,439
Pound

835,095

- 2C v/

Unit :
of
: Imports as o
Quantity: Mar. 29, 195

Commodity

Absolute Quotas:
Peanuts, shelled, unshelled,
blanched, salted, prepared, or
preserved (incl. roasted pea- 12 mos. from
nuts but not peanut butter)... Aug. 1, 1957

1,709,000

Pound

Quota Fillet

182,280,000
3,720,000

Pound
Pound

Quota Fillet

1,200,000

Pound

1,199,952

Feb. 1 - Oct. 31, 1958
Argentina
18,475,901
Paraguay
2,437,128
Other Countries
739,366

Pound
Pound
Pound

1,099,152*
Quota Filled
Quota Filled

Rye, rye flour, and rye meal ..
12 mos. from
July 1, 1957
Canada
Other countries
Butter substitutes, including
butter oil, containing 45$
or more butterfat
Tung oil .

Imports as of April 8, 1958.

Calendar Year

IMMEDIATE RELEASE,
Thursday. April 10.

TREASURY DEPARTMENT
Washington
A-217

The Bureau of Customs announced today preliminary figures showing the imports
for consumption of the commodities listed below within quota limitations from the
beginning of the quota periods to March 29, 1958, inclusive, as follows:

Unit :
of
: Imports as <
Quantity: Mar. 29, 19;

Commodity
Tariff-Rate Quotas:
Cream, fresh or sour Calendar Year 1,500,000

Gallon

Whole milk, fresh or sour Calendar Year 3,000,000

Gallon 35

Cattle, less than 200 lbs. each 12 mos. from 200,000
April 1, 1957

Head 19,390

Cattle, 700 lbs. or more each Jan. 1, 1958 (other than dairy cows)
Mar. 31, 1958

120,000

Head

111,389

Fish, fresh or frozen, filleted,
etc., cod, haddock, hake,
pollock, cusk, and rosefish .. Calendar Year

35,892,221

Tuna fish •• Calendar Year

44,693,87** Pound 8,352,090

White or Irish potatoes:
Certified seed
Other

Pound

Quota Filled

114,000,000
36,000,000

Pound
Pound

Quota Filled
103,918,406

Walnuts Calendar Year

5,000,000

Pound

1,190,155

Almonds, shelled, blanched,
roasted, or otherwise prepared Oct. 23, 1957 or preserved
Sept. 30, 1958

5,000,000

Pound

4,861,35k

Alsike clover seed 12 mos. from
July 1, 1957

3,000,000

Pound

233,^57

80,000,000

Pound

496,035

• 12 mos. from
Sept. 15, 1957

Peanut oil • 12 mos. from
July 1, 1957
Woolen fabrics Calendar Year 14,200,000

Pound 7,091,633

(l) Imports for consumption at the quota rate are limited to 8,973,055 lbs. during
the first three months of the calendar year.

(Continued)

TREASURY DEPARTMENT
Washington

IMMEDIATE RELEASE,
Thursday, April 10, 1958,

P9
\mt Cm

A-217

"The Bureau of Customs announced today preliminary figures showing the imports
for consumption of the commodities listed below within quota limitations from the
beginning of the quota periods to March 29, 1958, inclusive, as follows:

Commodity

Period and Quantity

: Unit :
:
of
: Imports as of
:Quantity: Mar. 29, 1958

Tariff-Rate Quotas:
Cream, fresh or sour Calendar Year

1,500,000

Gallon

Whole milk, fresh or sour ..... Calendar Year 3,000,000 Gallon 3 5
Cattle, less than 200 lbs. each 12 mos. from
April 1, 1957
Cattle, 700 lbs. or more each Jan. 1, 1958 (other than dairy cows)
Mar. 31, 1958

200,000 Head 19,390

120,000

Head

111,389

Fish, fresh or frozen, filleted,
etc., cod, haddock, hake,
pollock, cusk, and rosefish .. Calendar Year

35,892,221

Pound

Tuna fish Calendar Year

44,693,87k

Pound

114,000,000
36,000,000

Pound
Pound

Quota Filled
103,918,406

Walnuts Calendar Year

5,000,000

Pound

1,190,155

Almonds, shelled, blanched,
roasted, or otherwise prepared Oct. 23, 1957 or preserved
Sept. 30, 1958

5,000,000

Pound

4,861,354

Alsike clover seed 12 mos. from
July 1, 1957

3,000,000

Pound

233,^57

80,000,000

Pound

^96,035

14,200,000

Pound

7,091,633

White or Irish potatoes:
Certified seed
Other

12 mos. from
Sept. 15, 1957

Quota Filled
8,352,090

Peanut oil 12 mos. from
July 1, 1957
Woolen fabrics Calendar Year

(l) Imports for consumption at the quota rate are limited to 8,973,055 lbs. during
the first three months of the calendar year.

(Continued)

- 2 -

Unit :
of
: Imports as of
Quantity: Mar. 29, 1958

Commodity
Absolute Quotas:
Peanuts, shelled, unshelled,
blanched, salted, prepared, or
preserved (incl. roasted pea- 12 mos. from
nuts but not peanut butter)... Aug. 1, 1957

1,709,000

Pound

Quota Filled

182,280,000
3,720,000

Pound
Pound

Quota Filled

1,200,000

Pound

1,199,952

Feb. 1 - Oct. 31, 1958
Argentina
18,475,901
Paraguay
2,437,128
Other Countries
739,366

Pound
Pound
Pound

1,099,152*
Quota Filled
Quota Filled

Rye, rye flour, and rye meal ..
12 mos. from
July 1, 1957
Canada
Other countries
Butter substitutes, including
butter oil, containing 45$
or more butterfat
Tung oil

Imports as of April 8, 1958.

Calendar Year

w y

A - ?-i i
RELEASE A. F. NEWSPAPERS,
Tuesday, April 1$, 1958.
The Treasury Department announced last evening that the tenders for 11,700,000,
or thereabouts, of 91-day Treasury bills to be dated April 17 end to mature July 17,
1958, whieh were offered on April 10, were opmnmA at the Federal Reserve Banks on
April 14.
The details of this issue are as follows:
Total applied for - §2,727,389,000
Total accepted
- 1,701,155,000

(ineludes 1330,347,000 entered on
a noncompetitive basis and accepted in
full at the average pries shown below)

Range of accepted competitive bids: (Excepting 2 tenders totaling $1,550,000)
High
Low

- 99*729 Equivalent rate of discount approx. 1.072$ per ann
- 99Mb
«
n « n
i ^ x*t$& •
"

Average

- 99*690

•

1.225$ »

(5 percent of the awount bid for at the low price was accepted)

Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
HiehiBond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

1
43,540,000
1,874,652,000
33,737,000
77,822,000
19,687,000
73,553,00©
255,761,000
41,170,000
28,022,000
45,509,000
3b,ofalt,ooo
199,892,000

$
42,040,000
1,036,892,00©
16,059,000
71,822,000
18,687,000
64,778,000
166,661,000
36,359,000
23,587,000
42,559,000
26,044,000
155,667,000

2,727,389,000

H,70i,i55,ooo

TOTAL

•

TREASURY DEPARTMENT

O A

WASHINGTON, D.C.
RELEASE A. M. NEWSPAPERS,
Mesday, April 15> 1958.

N ^ ^ X

A-218

The Treasury Department announced last evening that the tenders for 11,700,000,00
or thereabouts, of 91-day Treasury bills to be dated April 17 and to mature July

1958, which were offered on April 10, were opened at the Federal Reserve Banks on
Upril 14.
The details of this issue are as follows *. °
Total applied for - $2,727,389,000
Total accepted
- 1,701,155,000

(includes $330,3^7,000 entered on
a noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bids: (Excepting 2 tenders totaling #1,550,000)
Hi h

S - 99.729 Equivalent rate of discount approx. 1.072$ per annua
Low
- 99.688
»
«
n
n
H
1.234$
Average

- 99.690

1.225$ «

(5 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

$
43,5140,000
1,874,652,000
33,737,000
77,822,000
19,687,000
73,553,000
255,761,000
41,170,000
28,022,000
45,509,000
34,044,000
199,892,000

$
42,040,000
1,036,892,000
16,059,000
71,822,000
18,687,000
64,778,000
166,661,000
36,359,000
23,587,000
02,559,000
26,044,000
155,667,000

$2,727,389,000

$1,701,155,000

TOTAL

n
»

A
85
B&4SDIAT! RSLEASE?
Itolay, April 14, 1956.
Tbm fre&sury Befarteent Urn? m®mmm&

tat subscription m t

•IXotmat fiinr#® with respect to the current cash offering of
|S,500 Billion, or thereabouts, of 1*6/8 fcvmot Trmmwty notes of
Series A*1M3.

fnese notes will be dated April 15, 1056, s M w i H

mature f$eb«i«y IS, 1963.
Subscriptions and allotments were divided aaxmg the several
federal Reservei Districts and tiie Treasury as follows:
federal Beeerv*i
pistriet

fetal §s*b#erip-

fotal iabaerip*
tions Allotted

Boston
lew To**
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
freej&iiry
Oovt. Brv.Aect®.

$ ais,ae$,oo0

z$om,mt$9mm

199,136,000
1,555,641,000
137,924,000
339,304,000
151,815,000
1§8,544,000
501,525,000
120,858,000
70,709,000
154,998,000
173,095,000
409,449,000
120,000
100,000,000

$15,741,461,000

$3,970,990,000

6,5§4,42S,O0O

s$ijm,om
mz,4m9mo

617,437,000
«47,*yt,000
4@f,t4?,0O0
305,886,000
58t,9*5,000
©S9,095,000
1,097,489,000
600,000

380*1,

TREASURY DEPARTMENT

WASHINGTON, D.C

IMMEDIATE RELEASE,
Monday, April 14, 1958.

A-219

The Treasury Department today announced the subscription and
allotment figures with respect to the current cash offering of
$3,500 million, or thereabouts, of 2-5/8 percent Treasury Notes of
Series A-1963. These notes will be dated April 15, 1958, and will
mature February 15, 1963.
Subscriptions and allotments were divided among the several
Federal Reserve Districts and the Treasury as follows:
Federal Reserve Total Subscrip- Total SubscripDistrict
[
tions Received
tions Allotted
Boston $ 816,263,000 $ 199,136,000
New York
6,384,426,000
Philadelphia
567,758,000
Cleveland
972,405,000
Richmond
617,437,000
Atlanta
647,472,000
Chicago
2,036,303,000 •
St. Louis
469,947,000
Minneapolis
305,886,000
OOD,VJUU,WWW
Kansas City
536,545,000
noiinn
C Q Q r\a"z r\f\r\
Dallas
689,093,000
San Francisco
1,697,426,000
Treasury
500,000
Govt.Inv.Accts.
TOTAL

$15,741,461,000

1,555,641,000
137,924,000
238,304,000
152,565,000
168,344,000
501,523,000
120,852,000
n>« « ^ ™n
78,709,000
134,998,000
173,095,000
409,449,000
120,000
100,000,000
$3,970,660,000

April 2, 1958

87
fhe ft»U#tl&g transaction® were mmm la direct and guaranteed eeeurities
of the Oovemment for Treasury investments and other aceomnte Airing the -month
of larch, 19S$s
Purchases 172,260,100.00
Sales 61,669.000.00
$10,591,100.00

(%d) Charles 2. Braonan

TREASURY DEPARTMENT

WASHINGTON, D.C.

IMMEDIATE RELEASE,
Friday, -Mar^h 1*1 j IpgQ.
C^U^^<^/

^42^Uy

A
A-192-

/yf/ /<?f£*

During fe^*sEEfy-1958, market transactions
in direct and guaranteed securities of the
government for Treasury investment and other
accounts resulted in net^S5sl=2s by the Treasury
Department of $0§5,833,560-.

0O0

TREASURY DEPARTMENT
WASHINGTON, D.C.

IMMEDIATE RELEASE,
Tuesday, April 15, 1958.

A-220

During March 1958, market transactions
in direct and guaranteed securities of the
government for Treasury investment and other
accounts resulted in net purchases by the
Treasury Department of $10,591*100.00.

oOo

- 3-

or by any local taxing authority. For purposes of taxation the amount of discouni
at which Treasury bills are originally sold by the United States is considered to
be interest. Under Sections h$k (b) and 1221 {$) of the Internal Revenue Code of
195a the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed ofj
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. itl8, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch.

- 2 -

2 percent of the face amount of Treasury bills applied for, unless the tenders are

accompanied by an express guaranty of payment by an incorporated bank or trust
company.
Immediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by

Treasury Department of the amount and price range of accepted bids. Those submitting tenders will be advised of the acceptance or rejection thereof. The

Secretary of the Treasury expressly reserves the right to accept or reject any
all tenders, in whole or in part, and his action in any such respect shall be

final. Subject to these reservations, noncompetitive tenders for $200,000 or l

without stated price from any one bidder will be accepted in full at the avera

price (in three decimals) of accepted competitive bids. Settlement for accepte

tenders in accordance with the bids must be made or completed at the Federal R
serve Bank on April 24, 1958 , in cash or other immediately available funds

toa
or in a like face amount of Treasury bills maturing

April 24, 1958

. Cash

and exchange tenders will receive equal treatment. Cash adjustments will be ma

for differences between the par value of maturing bills accepted in exchange a
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the
sale or other disposition of the bills, does not have any exemption, as such,
loss from the sale or other disposition of Treasury bills does not have any

special treatment, as such, under the Internal Revenue Code of 1951*. The bill

are subject to estate, inheritance, gift or other excise taxes, whether Federa

or State, but are exempt from all taxation now or hereafter imposed on the pri

or interest thereof by any State, or any of the possessions of the United Stat

TREASURY DEPARTMENT
Washington
A. n.

ZBE RELEASE/XKESfflBB NEWSPAPERS,
Thursday, April 17, 1958
The Treasury Department, by this public notice, invites tenders for
$ 1,700,000,000 , or thereabouts, of 91 -day Treasury bills, for cash and
in exchange for Treasury bills maturing

April 24, 1958

, in the amount of

$ 1,701,606,000 , to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided.
dated

The bills of this series will be

April 24, 1958 and will mature July 24, 1958 , when the face

—

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
closing hour,/tt» ofclock p.m., Eastern Standard time, Monday, April 21, 1958

$8gi
Tenders will not be received at the Treasury Department, Washington. Each tender

must be for an even multiple of $1,000, and in the case of competitive tenders

the price offered must be expressed on the basis of 100, with not more than th
decimals, e. g., 99.925. Fractions may not be used. It is urged that tenders

incorporated banks and trust companies and from responsible and recognized de

in investment securities. Tenders from others must be accompanied by payment o

RELEASE A'.M. NEWSPAPERS,
Thursday, April 17, 1958.

A-221

The Treasury Department, by this public notice, invites tenders
f o r ^ 1 ' ? 0 0 ' 0 0 0 * 0 0 0 ' or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing April 24, 1958,
In the amount of $1*701,606,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated April 24, 1958,
and will mature July 24,1956,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o^lock p.m., Eastern Standard time,
Monday, April 21, 1958.
Tenders will not be received at the
Treasury Department, Washington. Each tender must be for an even
multiple of $1,000., and in the case of competitive tenders the price
offered must be expressed on the basis of 100, with not more than
three decimals, e. g., 99.925. Fractions may not be used. It is
urged that tenders be made on the printed forms and forwarded in the
special envelopes which will be supplied by Federal Reserve Banks or
Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or in part, and his action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
$200,000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders in acoordance
with the bids must be made or completed at the Federal Reserve Banl
on April 24, 1958,
m cash or other immediately available funds
or in a like face amount of Treasury bills maturing April 24, 1958
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other dispositior
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority,
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder need Include in his income tax return only the
difference between the price paid for such bills, whether on
original issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.
0O0

- 9-

If this is our faith, let us take stock of the good and
the bad, but act as Americans responding to a challenge and
an opportunity.
Businessmen should realize that while this may well be
the most competitive year since the end of World War II, there
is a lot of business for those who go out for it. Spendable
funds are high; personal income in America from the last report
was only 1.7 percent lower than the all-time peak. Savings
are high. Credit is available. The American people are alert
to new and better ways of meeting their wants. They are ready
to welcome the almost-forgotten satisfactions of dealing in
a buyers1 market.
A well-stocked household can "afford to wait" — but it
can also be sold. New technological developments are making
yesterday*s products obsolete at the same time that they are
creating new products, new services and new employment
opportunities. Our present situation calls for courage and
foresight, for a considered evaluation of all practical
measures for encouraging renewed growth. At the same time
it calls for understanding and the cooperative efforts of
business, labor, government and individuals alike, to assure
sound growth and to resist expedients which could set in
motion a new round of such inflationary pressures as to leave
in Its wake even greater problems in the months and years ahead.
I have every confidence that the American people will be
wise enough and perceptive enough to support the right kind of
actions for promoting growth in our competitive economy. We
have overcome challenges in the past; we are equal to the
present challenge.

oOo

v> y

- 8 We all look forward to some relief from the present high
burden of taxation. Whatever action should be judged as proper
in this field will continue to receive our daily consideration.
Modification of taxes in an economy as complex as ours,
however, must be based on a very careful review of what in
fact can be accomplished — and not on the theory that a
single dramatic action will automatically be all that is
required to assure business recovery. The very fact that
the present downturn in business developed at a time when
personal income was at the highest level in history would
seem to indicate many other considerations are involved.
We must, I believe, take into our account in making any
decision in this area:
(l) Our present and our future fiscal position, for
not only does debt, but the very management of it, weigh
heavily in our economy;
(2) We must see ahead sufficiently clearly to have a
reasoned plan and judgment as to how we pay for what we spend.
The Government is the biggest single buyer of goods and services
in this country. Despite any fluctuations which have occurred,
one of the reasons for increasing cost is that the things we
buy are costing more. In judging our ability to pay for what
we buy this fact must always be weighed in the balance.
(3) We must reasonably identify the results of our efforts
in terms of the resumption of a sustained and a sustainable
growth in terms of equitable distribution, in terms of what
creates and maintains new job opportunities, new expansion,
new incentives, real and justified continuation of confidence.
These considerations do not always coincide with the most
popular. They have, however, motivated the understanding that
any action in this field would be preceded by bipartisan
consultation with the leaders in Congress. The welfare of
the people and not any party must first be served. This country
is indebted to the leaders on both sides of the aisle for an
attitude of statesmanship.
Most of us, I think, have faith in our country's future.
We believe tomorrow will be all right, but how about today?
Above all else we must apply reasoned judgment. We are not
seeking a stimulant that brings quick change and a new crisis,
but a firm posture of plans, attitudes, and actions that
underlie a soundly enduring prosperity with lasting jobs and
lasting growth.

- 7These figures as to deficits give us concern. They
underline the fact that the Federal Government's over-all
fiscal situation is something that all of us must keep in
mind as we consider changes in either the spending or
revenue programs of the Federal Government.
They do not warrant pessimism. We confidently believe
that our present recession will not be of long duration and
that sustainable growth in our economy will soon be realized.
We believe that the American people want national decisions
to be made in the light of careful thought with the best
objective judgments as to the long-run interest of the
nation.
Already our public debt amounts to a third of all our
public and private debt combined. It is equal to $1,600
for each man, woman and child in this country. We must ask
ourselves how much more spending we want to concentrate in
the hands of Government — and how much more our Federal
debt can be increased without long-term adverse effects on
the economic health of the Nation.
And now, let us turn for a moment to the other side of
the fiscal picture — the situation with respect to possible
changes in our tax laws which are. being suggested at the
present time.
This problem deserves the considered judgment and thinking
of us all. It is not something to be done competitively. We
must weigh the advantage and the consequences. In some respects
we are dealing in imponderables. We will be trying to assess
not only the results of taking less money in taxes, but the
attitudes of people. What will they do with the money?
I am sure many people are thinking that during the years
of high economic activity and high employment, in the absence
of substantial surpluses, tax reductions are regarded as
inflationary. When receipts are down from slackening economic
activity and expenditures remain high, tax reductions are
regarded as too costly. So the taxpayer asks when can the
burden be lessened?
^=2fe^^^fa^TOF®i«^tsk#«wfe#i^fecan th&J3tua24»a«^e«^i®#®«ii®d ?

When one adds direct military cost, the atomic energy
cost related to preparedness, the cost ofc^|bt that largely
results from war, the cost of hospH^li^zatioWi retirement
and'benefits to those who have and continue to fiefend us, we
are taking about 83 cents^mt of each dollar collected in
federal g Q V W t e . — E mfflahFpeople In this country want these
funds materially reduced? Yet all this means th|jg::will be *
increased spending from the Federal Treasury. I^aTsb means
we have some choices to make.

- 6As for spending, the Government, out of our ^e-a™%>
now spends $1,500,000,000 from Monday morning through Friday
night each week, (in addition, $1,600,000,000 a month is
being paid out for social benefits of various kinds by
states, by municipalities, and by the Federal Government.;
When one looks at these rates of expenditure within the
context of a $400 billion plus economy, who is wise enough
to predict with accuracy how mucin the economy would be
stimulated if the Federal Government should spend another
$20 million a week? And yet the cost to the Government of
$20 million a week is $1 billion a year.
Federal spending is now higher than a year ago and it is
rising steadily. Recent actions will accelerate expenditures
in Federal programs such as highway, water resources and
military construction. The Department of Defense in the first
six months of 1958 will place contracts with private industry
totaling $5-1/2 billion more than were placed in the last six
months of 1957. Whatever the cost we will defend this country,
The cost will likely be more rather than less. This is not a
short-run effort. It will go on until the tensions end,
until the Russian rulers seek real peace^nd not a propaganda
advantage.
When one adds direct military cost, mutual security,the
atomic energy cost related to preparedness, the cost of debt
that largely results from war, the cost of hospitalization,
retirement and benefits to those who have and continue to
defend us, we are taking about 83 cents out. of each
dollar collected in Federal revenue. This emphasizes the
necessity to do all&e can to assure economical operationsin
all
for byinjr sta&dard
course
is ayear
costly
$, areas
The expenditures
for the our,
current
fiscal
1958one.***Yet
all this
mpis 30,
therWlfill.
increased
,%&e
indicate,
hyaline
a level be
well
over $73spending
billion.f rom.
While
Federal
It difficult
also meanstoweforecast
have some
choice£-•
to make ^
revenue Tre^sUicy.
receipts are
because
of the
irregular pattern in payments, they will likely be, for 1958,
in the order of magnitude of $70 billion. The sum of all
programs now in being for all purposes will probably result
in a rate of Federal spending for the fiscal year 1959 in
the order of magnitude of $78 billion, as the Director of
the Budget has said.
On the revenue side for fiscal 1959 it is even more difficult
to estimate for more than a year in advance. But while we do
expect early resumption of economic growth, we must be aware
of the likelihood that we will fall short of our January estimate.

%j y

We must concern ourselves not only with needs and
demands at home but needs and demands of the peoples of
the free world. America has long passed the age of isolation.
In any examination of our productive capacity we must take
into account the requirements of all who belong to the
future. What we should actually fear is standing still.
But we in the United States will need all the skilled
manpower, all the modernized capacity, and all the managerial
talents we can muster for the expanding volume of goods and
services which will surely be demanded by this growing
population — not in 1970, but in the very near future.
Now is the time when Americans should be striving to
improve efficiency, to achieve more production per dollar
of cost, to avoid inflation of cost and thus of prices. In
the final analysis real prosperity can come only from the
production of goods and services at prices people are willing
and able to pay. All elements of our economic life must come
to this realization. Your own role as editors in observing
and analyzing these developments is a crucial one — and
never more vital than now.
Continual growth in the demand for the products of
American industry is inevitable, as inevitable as the march
of time. Our realists are the ones who recognize this truth.
Let us look at the role of Government in our economy by
examining three areas of governmental policy—monetary, spending
and revenue.
The aim of monetary policy is to foster balanced and
orderly economic growth by discouraging the excessive use of
credit during boom times and encouraging its use for productive
purposes during recessionary periods such as the present.
Anti-inflationary policies and anti-deflationary policies
are inseparably linked. Most importantly the Federal Reserve
System has demonstrated a flexible willingness to utilize its
powers and since October 1957 through yesterday has taken a
number of steps whieh have resulted in substantially Increasing
the volume of money and credit. The changes in the interest
rate structure which have occurred during the past 6 months
have been the most dramatic in the history of this country.
The price of the credit was among the last to go up and the
rrn1 r».lr£»R"h f:r> f . n m p

rinurn

QQ
*y '^J

- 4While the Government can be helpful in providing an
economic climate encouraging to competitive enterprise, we
must nevertheless recognize that Government action necessarily
plays a secondary role in our kind of economic system. We
must understand that there necessarily will be some fluctuations
in economic activity from time to time. Despite heavy Government
spending, the Federal Government only accounts for one-eighth
of the total spending for goods and services in the country;
the rest is determined by private enterprise and decision.
Limitations on the power of the Government to stimulate
action are well illustrated in the credit field. The Government
and the Federal Reserve can make credit more readily available —
and they have done so. But over-all measures to relax credit
cannot change the fact that the initial decision to ask for a
loan — to make use of available credit — is a personal or
individual business matter. It depends on the judgment of the
borrower with respect to a number of factors in his own situation
and in the economic outlook. Only then does the lender come
into the picture. This shows how the psychological element
plays such an important role in our individualistic, private
enterprise system.
As justification for confidence, let's look at some of
the growth factors that shape our economic future.
Our population has doubled in 50 years. It is expanding
at a rate of 3 million persons per year. The number of American
workers is increasing at a rate of nearly 1 million per year.
Family income after taxes was at an all-time high in 1957 and
continues high. With our production more than doubling every
20 years millions of new workers will be needed to make, sell
and distribute our goods. There is around $300 billion of
savings held by individuals alone. The billions of dollars
being spent annually for research in industry will mean more
products, more jobs and better living. During the last 12
years we have spent $300 billion for new business plant and
equipment needs, a figure which may easily be dwarfed by our
expansion over the next 12 years.
Looking at even broader figures, it took the world something
like 5,000 years of recorded history to have the first billion
people alive on this earth at one time. This occurred in 1830.
It took us only a little over 100 years to have the second
billion people alive at one time on this globe. By 1970 the
world will have three billion inhabitants — and those three
billion are the people whose wants and demands will make the
economy of our country and the economy of the world.

- 3We have in our country an economic system that gives
the widest possible play to creative genius and technology.
These forces bring about constant change and growth in our
society. From the earliest days of our history, Americans
have eagerly grasped the opportunities presented them for
managing their own affairs. Individual responsibility —
facing problems and getting things done — has kept Americans
working, striving and above all improving and adding to the
store of ideas and accomplishments.
These personal drives are present, as strong as ever.
Keeping'pace with them are the incalculable new opportunities
for creative ingenuity which are being opened up constantly
by modern science.
Under these conditions, it would be shortsighted indeed
to sell our American economy short for any protracted period.
We have what we need to keep our productive engine
operating at a high level — the man-power, the skills, the
managerial ability, the inventive genius.
We are a people with a strong belief in the future.
We have a willingness on the part of our people and their
Government to use such mechanisms as are at our command in a
way which will help assure a reasonable rate of sustainable
growth in our economy.
Each time that we examine a proposal, however, let us ask
ourselves: Will a specific proposal increase business incentives?
Will it add significantly to purchasing power? Will it foster
the sort of confidence that encourages private expenditures?
Will it do these things without seriously weakening the fiscal
position of the Government? Is it the sort of activity a
prudent government would engage in? These are questions of
the greatest national significance.
We must take a hard look at the particular kind of
economic mechanism we have built in this country. It is an
economy that last year turned out more than $430 billion of
gross national product.
This accomplishment results primarily from the freedom of
both producers and consumers to make their own decisions —
decisions on markets, decisions on new products, decisions on
purchases, decisions on spending versus saving, decisions on
what the course of the economy may be in the future. It is
these decisions — the millions of them which are made every
day — which determine whether the wheels of our economy will
turn at a faster or slower rate.

Every effort to control the process of sustainable
growth by a formula or a set of rules ignores
the constant change that is a part of our development and minimizes judgment.
9. So long as we are free to make our own decisions
the most important single factor in our economic
system is the continuity of confidence.
10. My faith is strong — I have confidence in the
determination of our people to work and plan
and accomplish. We are not headed for a ganoott
depression, but for new horizons of progress.
******

A number of elements In the current economic situation are
causing concern. Human problems are involved; waste of our
resources is involved. This loss of productive ability must
not continue for a protracted length of time.
But at the same time we must avoid taking improvident
steps whieh might undermine our future growth and prosperity
potentials.
In a democracy, decisions of national consequence stem
from the people. To do the right things as a Nation, and avoid
doing the wrong things, our citizens must understand the problems
involved as well as the practical means for solving them. In
this, you as editors have a great responsibility.
No economic period has ever been so fully reported,
analyzed, and interpreted by the media of this country as
the present one. The distribution of this reporting to the
American people has been speeded up immeasurably by the
technological changes in the newspaper and broadcasting
fields. This Intensive coverage of our economy is right
and proper and as it should be. The American people must
be honestly and completely informed about everything that
is going on whieh affects them.
With this in mind, I am sure we all recognize the
importance of continuing to keep the presentation of happenings
in our economy in perspective. Enlightened citizens,
objectively informed, can be depended on to exercise sound
judgment. Keeping our citizens so informed is a great
responsibility.

TREASURY DEPARTMENT
Washington

i no
mC mj C

FOR RELEASE P. M. NEWSPAPERS
Friday, April 18, 1958.
Remarks by Secretary of the Treasury
Robert B. Anderson before the American
Society of Newspaper Editors, at a
Luncheon, Hotel Statler, Friday,
12:00 noon, April 18, 1958
There are some postulates which I hold are basic to
thinking about economic affairs in this great country of
ours.
1. There is every reason to believe in the economic
future of the United States.
2. A dynamic economy should encourage competition
but should seek to minimize fluctuations and
dislocations.
3. During periods of adjustment, such as the
present one, we should remember that no one
has all the blame but no one is blameless.
4. The continued operation of a free society presupposes a growing sense of responsibility on
the part of all who participate commensurate
with the growing complexity in our economic
system.
5. The employment act Is a challenge and demand
for our best effort but cannot be regarded as
a government guarantee of no fluctuations or
of no unemployment in the absence of rigid
controls.
6. Equally as important as jobs is the continuity
of the job and the dollars earned in terms of
real goods.
7. There is no single doctrine or economic theory
that is the sine qua non of growth and development
in this country.

A-222

TREASURY DEPARTMENT
Washington

1m
A.\~> y

FOR RELEASE P. M. NEWSPAPERS
Friday, April 18, 1958.
Remarks by Secretary of the Treasury
Robert B. Anderson before the American
Society of Newspaper Editors, at a
Luncheon, Hotel Statler, Friday,
12:00 noon, April 18, 1958
There are some postulates which I hold are basic to
thinking about economic affairs in this great country of
ours.
1. There is every reason to believe in the economic
future of the United States.
2. A dynamic economy should encourage competition
but should seek to minimize fluctuations and
dislocations.
3. During periods of adjustment, such as the
present one, we should remember that no one
has all the blame but no one is blameless.
4. The continued operation of a free society presupposes a growing sense of responsibility on
the part of all who participate commensurate
with the growing complexity in our economic
system.
5. The employment act is a challenge and demand
for our best effort but cannot be regarded as
a government guarantee of no fluctuations or
of no unemployment in the absence of rigid
controls.
6. Equally as important as jobs is the continuity
of the job and the dollars earned in terms of
real goods.
7. There is no single doctrine or economic theory
that is the sine qua non of growth and development
In this country.

A-222

- 2-

104

8. Every effort to control the process of sustainable
growth by a formula or a set of rules ignores
the constant change that is a part of our development and minimizes judgment.
So long
9. as we are free to make our own decisions
the most important single factor in our economic
system is the continuity of confidence.
10. is strong — I have confidence in the
My faith
determination of our people to work and plan
and accomplish. We are not headed for a
depression, but for new horizons of progress.
******

A number of elements in the current economic situation are
causing concern. Human problems are involved; waste of our
resources is involved. This loss of productive ability must
not continue for a protracted length of time.
But at the same time we must avoid taking improvident
steps which might undermine our future growth and prosperity
potentials.
In a democracy, decisions of national consequence stem
from the people. To do the right things as a Nation, and avoid
doing the wrong things, our citizens must understand the problems
involved as well as the practical means for solving them. In
this, you as editors have a great responsibility.
No economic period has ever been so fully reported,
analyzed, and interpreted by the media of this country as
the present one. The distribution of this reporting to the
American people has been speeded up immeasurably by the
technological changes In the newspaper and broadcasting
fields. This intensive coverage of our economy is right
and proper and as It should be. The American people must
be honestly and completely informed about everything that
is going on which affects them.
With this in mind, I am sure we all recognize the
importance of continuing to keep the presentation of happenings
in our economy in perspective. Enlightened citizens,
objectively informed, can be depended on to exercise sound
judgment. Keeping our citizens so Informed is a great
responsibility.

105
- 3 We have in our country an economic system that gives
the widest possible play to creative genius and technology.
These forces bring about constant change and growth in our
society. From the earliest days of our history, Americans
have eagerly grasped the opportunities presented them for
managing their own affairs. Individual responsibility —
facing problems and getting things done — has kept Americans
working, striving and above all improving and adding to the
store of ideas and accomplishments.
These personal drives are present, as strong as ever.
Keeping pace with them are the incalculable new opportunities
for creative ingenuity which are being opened up constantly
by modern science.
Under these conditions, it would be shortsighted indeed
to sell our American economy short for any protracted period.
We have what we need to keep our productive engine
operating at a high level — the man-power, the skills, the
managerial ability, the inventive genius.
We are a people with a strong belief in the future.
We have a willingness on the part of our people and their
Government to use such mechanisms as are at our command in a
way which will help assure a reasonable rate of sustainable
growth in our economy.
Each time that we examine a proposal, however, let us ask
ourselves: Will a specific proposal increase business incentives?
Will it add significantly to purchasing power? Will it foster
the sort of confidence that encourages private expenditures?
Will It do these things without seriously weakening the fiscal
position of the Government? Is it the sort of activity a
prudent government would engage in? These are questions of
the greatest national significance.
We must take a hard look at the particular kind of
economic mechanism we have built in this country. It is an
economy that last year turned out more than $430 billion of
gross national product.
This accomplishment results primarily from the freedom of
both producers and consumers to make their own decisions —
decisions on markets, decisions on new products, decisions on
purchases, decisions on spending versus saving, decisions on
what the course of the economy may be in the future. It is
these decisions — the millions of them which are made every
day — which determine whether the wheels of our economy will
turn at a faster or slower rate.

IOS
- 4While the Government can be helpful in providing an
economic climate encouraging to competitive enterprise, we
must nevertheless recognize that Government action necessarily
plays a secondary role in our kind of economic system. We
must understand that there necessarily will be some fluctuations
in economic activity from time to time. Despite heavy Government
spending, the Federal Government only accounts for one-eighth
of the total spending for goods and services in the country;
the rest is determined by private enterprise and decision.
Limitations on the power of the Government to stimulate
action are well illustrated in the credit field. The Government
and the Federal Reserve can make credit more readily available —
and they have done so. But over-all measures to relax credit
cannot change the fact that the initial decision to ask for a
loan — to make use of available credit — is a personal or
individual business matter. It depends on the judgment of the
borrower with respect to a number of factors in his own situation
and in the economic outlook. Only then does the lender come
Into the picture. This shows how the psychological element
plays such an important role in our individualistic, private
enterprise system.
As justification for confidence, let's look at some of
the growth factors that shape our economic future.
Our population has doubled In 50 years. It is expanding
at a rate of 3 million persons per year. The number of American
workers is increasing at a rate of nearly 1 million per year.
Family income after taxes was at an all-time high in 1957 and
continues high. With our production more than doubling every
20 years millions of new workers will be needed to make, sell
and distribute our goods. There is around $300 billion of
savings held by individuals alone. The billions of dollars
being spent annually for research in industry will mean more
products, more jobs and better living. During the last 12
years we have spent $300 billion for new business plant and
equipment needs, a figure which may easily be dwarfed by our
expansion over the next 12 years.
Looking at even broader figures, it took the world something
like 5,000 years of recorded history to have the first billion
people alive on this earth at one time. This occurred in 1830.
It took us only a little over 100 years to have the second
billion people alive at one time on this globe. By 1970 the
world will have three billion inhabitants — and those three
billion are the people whose wants and demands will make the
economy of our country and the economy of the world.

- 5-

107

We must concern ourselves not only with needs and
demands at home but needs and demands of the peoples of
the free world. America has long passed the age of isolation.
In any examination of our productive capacity we must take
into account the requirements of all who belong to the
future. What we should actually fear is standing still.
But we in the United States will need all the skilled
manpower, all the modernized capacity, and all the managerial
talents we can muster for the expanding volume of goods and
services which will surely be demanded by this growing
population — not in 1970, but in the very near future.
Now is the time when Americans should be striving to
improve efficiency, to achieve more production per dollar
of cost, to avoid inflation of cost and thus of prices. In
the final analysis real prosperity can come only from the
production of goods and services at prices people are willing
and able to pay. All elements of our economic life must come
to this realization. Your own role as editors in observing
and analyzing these developments is a crucial one — and
never more vital than now.
Continual growth in the demand for the products of
American industry is inevitable, as inevitable as the march
of time. Our realists are the ones who recognize this truth.
Let us look at the role of Government in our economy by
examining three areas of governmental policy—monetary, spending
and revenue.
The aim of monetary policy is to foster balanced and
orderly economic growth by discouraging the excessive use of
credit during boom times and encouraging its use for productive
purposes during recessionary periods such as the present.
Anti-inflationary policies and anti-deflationary policies
are Inseparably linked. Most importantly the Federal Reserve
System has demonstrated a flexible willingness to utilize its
powers and since October 1957 through yesterday has taken a
number of steps which have resulted in substantially increasing
the volume of money and credit. The changes in the Interest
rate structure which have occurred during the past 6 months
have been the most dramatic in the history of this country.
The price of the credit was among the last to go up and the
quickest to come down.

- 6-

108

As for spending, the Government, out of our Treasury,
now spends $1,500,000,000 from Monday morning through Friday
night each week, (in addition, $1,600,000,000 a month is
being paid out for social benefits of various kinds by
states, by municipalities, and by the Federal Government.)
When one looks at these rates of expenditure within the
context of a $400 billion plus economy, who is wise enough
to predict with accuracy how much the economy would be
stimulated if the Federal Government should spend another
$20 million a week? And yet the cost to the Government of
$20 million a week is $1 billion a year.
Federal spending is now higher than a year ago and it is
rising steadily. Recent actions will accelerate expenditures
in Federal programs such as highway, water resources and
military construction. The Department of Defense in the first
six months of 1958 will place contracts with private industry
totaling $5-1/2 billion more than were placed in the last six
months of 1957. Whatever the cost we will defend this country.
The cost will likely be more rather than less. This is not a
short-run effort. It will go on until the tensions end,
until the Russian rulers seek real peace and not a propaganda
advantage.
When one adds direct military cost, mutual security,the
atomic energy cost related to preparedness, the cost of debt
that largely results from war, the cost of hospitalization,
retirement and benefits to those who have and continue to
defend us, we are taking about 83 cents out of each
dollar collected in Federal revenue. This emphasizes the
necessity to do all we can to assure economical operations in
all areas for by any standard our course is a costly one.
Yet all this means there will be increased spending from the
Federal Treasury. It also means we have some choices to make.
The expenditures for the current fiscal year 1958
indicate, by June 30, a level well over $73 billion. While
revenue receipts are difficult to forecast because of the
irregular pattern in payments, they will likely be, for 1958,
in the order of magnitude of $70 billion. The sum of all
programs now in being for all purposes will probably result
in a rate of Federal spending for the fiscal year 1959 in
the order of magnitude of $78 billion, as the Director of
the Budget has said.
On the revenue side for fiscal 1959 it is even more difficult
to estimate for more than a year in advance. But while we do
expect early resumption of economic growth, we must be aware
of the likelihood that we will fall short of our January estimate.

- 7-

109

These figures as to deficits give us concern. They
underline the fact that the Federal Government's over-all
fiscal situation is something that all of us must keep in
mind as we consider changes in either the spending or
revenue programs of the Federal Government.
They do not warrant pessimism. We confidently believe
that our present recession will not be of long duration and
that sustainable growth in our economy will soon be realized.
We believe that the American people want national decisions
to be made in the light of careful thought with the best
objective judgments as to the long-run interest of the
nation.
Already our public debt amounts to a third of all our
public and private debt combined. It is equal to $1,600
for each man, woman and child in this country. We must ask
ourselves how much more spending we want to concentrate in
the hands of Government — and how much more our Federal
debt can be increased without long-term adverse effects on
the economic health of the Nation.
And now, let us turn for a moment to the other side of
the fiscal picture — the situation with respect to possible
changes in our tax laws which are being suggested at the
present time.
This problem deserves the considered judgment and thinking
of us all. It is not something to be done competitively. We
must weigh the advantage and the consequences. In some respects
we are dealing in imponderables. We will be trying to assess
not only the results of taking less money in taxes, but the
attitudes of people. What will they do with the money?
I am sure many people are thinking that during the years
of high economic activity and high employment, in the absence
of substantial surpluses, tax reductions are regarded as
inflationary. When receipts are down from slackening economic
activity and expenditures remain high, tax reductions are
regarded as too costly. So the taxpayer asks when can the
burden be lessened?

We all look forward to some relief from the present high
burden of taxation. Whatever action should be judged as proper
in this field will continue to receive our daily consideration.
Modification of taxes in an economy as complex as ours,
however, must be based on a very careful review of what in
fact can be accomplished — and not on the theory that a
single dramatic action will automatically be all that is
required to assure business recovery. The very fact that
the present downturn in business developed at a time when
personal income was at the highest level in history would
seem to Indicate many other considerations are involved.
We must, I believe, take into our account in making any
decision in this area:
(1) Our present and our future fiscal position, for
not only does debt, but the very management of it, weigh
heavily in our economy;
(2) We must see ahead sufficiently clearly to have a
reasoned plan and judgment as to how we pay for what we spend.
The Government is the biggest single buyer of goods and services
in this country. Despite any fluctuations which have occurred,
one of the reasons for increasing cost is that the things we
buy are costing more. In judging our ability to pay for what
we buy this fact must always be weighed in the balance.
(3) We must reasonably identify the results of our efforts
in terms of the resumption of a sustained and a sustainable
growth in terms of equitable distribution, in terms of what
creates and maintains new job opportunities, new expansion,
new Incentives, real and justified continuation of confidence.
These considerations do not always coincide with the most
popular. They have, however, motivated the understanding that
any action in this field would be preceded by bipartisan
consultation with the leaders in Congress. The welfare of
the people and not any party must first be served. This country
is indebted to the leaders on both sides of the aisle for an
attitude of statesmanship.
Most of us, I think, have faith in our country's future.
We believe tomorrow will be all right, but how about today?
Above all else we must apply reasoned judgment. We are not
seeking a stimulant that brings quick change and a new crisis,
but a firm posture of plans, attitudes, and actions that
underlie a soundly enduring prosperity with lasting jobs and
lasting growth.

If this is our faith, let us take stock of the good and
the bad, but' act as Americans responding to a challenge and
an opportunity.
Businessmen should realize that while this may well be
the most competitive year since the end of World War II, there
Is a lot of business for those who go out for it. Spendable
funds are high; personal income in America from the last report
was only 1.7 percent lower than the all-time peak. Savings
are high. Credit is available. The American people are alert
to new and better ways of meeting their wants. They are ready
to welcome the almost-forgotten satisfactions of dealing in
a buyers' market.
A well-stocked household can "afford to wait" — but it
can also be sold. New technological developments are making
yesterday's products obsolete at the same time that they are
creating new products, new services and new employment
opportunities. Our present situation calls for courage and
foresight, for a considered evaluation of all practical
measures for encouraging renewed growth. At the same time
it calls for understanding and the cooperative efforts of
business, labor, government and individuals alike, to assure
sound growth and to resist expedients which could set in
motion a new round of such Inflationary pressures as to leave
In Its wake even greater problems in the months and years ahead.
I have every confidence that the American people will be
wise enough and perceptive enough to support the right kind of
actions for promoting growth in our competitive economy. We
have overcome challenges in the past; we are equal to the
present challenge.

0O0

112
RELKASE A. i. M^SPAPERS,
Tuesday, April 22. 1958.
The treasury Department announced last evening that the tenders? for §1,700,000
©r thereabouts, of £l«4ay treasury Mile to be dated April tk sad to mature July 2k{
1®SB, whieh were offered on April 17, were opened at the federal Mmmmrm Banks on
April 21

the details of tills issue are as follow* i
total applied for - tt,S*MQOf00O
total accepted
- X910Q9k$$9QOO

(includes #308,105*000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Hang® of accepted competitive older (Excepting one tender of $300,000}
High
Low

- 9f*1kh l«pivaleat rate of diaoount approx. 1.013$ per anm
m ee.72f
«
• e
a
a
l#0?tjf • «

Average

- 99*733

•

•»

1.05536 •

(15 percent of the amount bid for at the low price waa accepted)
Federal teeerve
Biatriot

total
Applied for

Boston
Hew" fork

# fct,03*,QOO
1,150,050,000

total
Accepted

Mt,229,000
277,76Jt,000
31,361,000
35,000,000
56,2$*,00O
2k9M90OO
120,1430,000

1
1*2,039,000
1,056,1.65,000
2«,33ii,000
51,611,000
13,692,000
li3,?2f,000
2i3,?U*,000
31,361,000
3i*,?00,0O0
lik,19ltf000
2ii,Wi6,000
11^580,000

$2,5^,600,000

il,70G,£s65,OO0

%,$%9®m

Philadelphia
Cleveland
Bielffiond
Atlanta
Cbicago
St. Louis'
Minneapolis
Kansas City
Dallas
San Franoiaco

56,661,000

x}9m9om

TOTAL

Qf#Wm**M <&**

ft+,Lf

/> otff

if*

TREASURY DEPARTMENT
wmmammmmmmmmmm^mmmmmmmmmmmmmmmmmmKmmmmmmmm^mm^mmmm.

WASHINGTON, D.C.
BLEASE A. M. NEWSPAPERS,
nesday, April 22. 1958.

A-223

The Treasury Department announced last evening that the tenders for $1,700,000,000,

p thereabouts, of 91-day treasury bills to be dated April 2k and to mature July 2
?58, which were offered on April 17, were opened at the Federal Reserve Banks on
pril 21.
The details of this issue are as follows%
Total applied for - $2,$9k9600,000
Total accepted
- 1,700,1*65,000

(includes #308,1*95,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bidss (Excepting one tender of #300,000)
High
Low

- 99*lkh Equivalent rate of discount approx. 1.013$ per annum
- 99*729
"
a
s
a
«
l.Q12% »
»

Average

- 99*133

X.0$$% «

(15 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

$
1*2,039,000
1,850,050,000
3l*,53l*,000
56,661,000
13,692,000
1*1*,229,000
277,76U,000
31,361,000
35,000,000
56,29U,000
2l*,5i*6,000
128,1*30,000

#
1*2,039,000
1,056,665,000
29,33u,000
51,611,000
13,692,000
1*3,929,000
213,7ll*,000
31,361,000
3J*,900,000
U*,19l*,000
2U,l*li6,OO0
llU.580,000

#2,59l*,600,000

#1,700,1*65,000

TOTAL

- 3XXESAX

or by any local taxing authority. For purposes of taxation the amount of discou
at which Treasury bills are originally sold by the United States is considered t
be interest. Under Sections h$h (b) and 1221 ($) of the Internal Revenue Code o
1951* the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed 0
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereundi
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 1»1&, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch.

- 2 -

2 percent of the face amount of Treasury bills applied for, unless the tenders ar

accompanied by an express guaranty of payment by an incorporated bank or trus
company.
Immediately after the closing hour, tenders will be opened at the Federal Re

serve Banks and Branches, following which public announcement will be made by

Treasury Department of the amount and price range of accepted bids. Those sub
mitting tenders will be advised of the acceptance or rejection thereof. The

Secretary of the Treasury expressly reserves the right to accept or reject an

all tenders, in whole or in part, and his action in any such respect shall be
final. Subject to these reservations, noncompetitive tenders for $200,000 or

without stated price from any one bidder will be accepted in full at the aver

price (in three decimals) of accepted competitive bids. Settlement for accept
tenders in accordance with the bids must be made or completed at the Federal
serve Bank on May 1. 1958 , in cash or other immediately available funds
or in a like face amount of Treasury bills maturing May 1. 1958 • Cash

sale or other disposition of the bills, does not have any exemption, as such,
loss from the sale or other disposition of Treasury bills does not have any

special treatment, as such, under the Internal Revenue Code of 1951*. The bil

are subject to estate, inheritance, gift or other excise taxes, whether Feder

or State, but are exempt from all taxation now or hereafter imposed on the pr

or interest thereof by any State, or any of the possessions of the United Sta

XXxTEtKXXXX

TREASURY DEPARTMENT
Washington
,

A. M.

If-,

JLm^- ^

XBK RELEASE/ KEKKXM NEWSPAPERS,
Thursday, April 24, 1958
.

The Treasury Department, by this public notice, invites tenders for
#1,700,000,000 , or thereabouts, of 91 -day Treasury bills, for cash and
in exchange for Treasury bills maturing May 1,1958 _, in the amount of
#1,700,563,000 , to be issued on a discount basis under competitive and non-

—w—
competitive bidding as hereinafter provided. The bills of this series will be
dated May 1, 1958 , and will mature July 31, 1958 , when the face
m

^-!

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000
(maturity value).
. Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
closing hour/ txss. o'clock p.m., Eastern/ffifcaxikiHnd time, Monday, April 28, 1958
Tenders will not be received at the Treasury Department, Washington.

Each tender

must be for an even multiple of $1,000, and in the case of competitive tenders
the price offered must be expressed on the basis of 100, with not more than three
decimals, e. g., 99.925. Fractions may not be used. It is urged that tenders
be made on the printed forms and forwarded in the special envelopes which will be
supplied by Federal Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit tenders
except for their own account. Tenders will be received without deposit from
incorporated banks and trust companies and from responsible and recognized dealers
in investment securities. Tenders from others must be accompanied by payment of

TREASURY DEPARTMENT
»L.".L

-i 7
1 J- '

'm,''"lll'l'ima\?>\.V2^i£ZJ!.J3!~zz^i!^^

WASHINGTON, D.
RELEASE A'.M. NEWSPAPERS,
Thursday, April 2k. 1958.

A-224

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing May 1, 1958,
in the amount of $1,700,563,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated May 1, 1958,
and will mature July 31* 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, April 28, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from Incorporated banks and trust companies and from
responsible and recognized dealers In investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or in part, and his action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
$200,000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders In accordance
with the bids must be made or completed at the Federal Reserve Bank
on May 1, 1958,
In cash or other Immediately available funds
or In a like face amount of Treasury bills maturing May 1, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted In exchange and the issue price of the new
bills.
The Income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter imposed
on the principal or Interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States Is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder need Include in his Income tax return only the
difference between the price paid for such bills, whether on
original Issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

oOo

- 10 -

should be such a requirement and that any investment association shou

be permitted to invest more than $250, 000 in any one small business inter -

prise. W e also believe that in order to diversify the risk, no investment

association should be permitted to invest more than 20% of its capital and

surplus in any single business concern.

Most, if not all, of the principles which I have endeavored to express

are incorporated in S. 3643.

Mr. Dan Throop Smith will submit a separate statement on the tax

provisions of the various bills.

previously indicated, w e believe that Government funds should be used

exclusively for loans and not for the purchase of equities.

S o m e of the bills provide for loans to small business concerns running

as long as 30 years with an additional 10 years for orderly liquidation. W e

believe that a 10 year loan to a small business is a long-term loan. In

setting up a 10 year loan the fixed repayment schedule need not always re-

quire evenly distributed amortization nor necessarily complete amortiza-

tion during the 10 year period because it m a y be expected that contingent

payments from earnings or payments from other sources will supplement

the fixed payments and retire the balance within 10 years, or reduce it to an

amount which can be refinanced privately. If an additional 10 years is allowed.

if necessary for orderly liquidation, w e feel that any legitimate needs of a

small business concern would be provided for.

It is not clear in some of the bills that the proposed financial assistance

shall be available only to small business concerns. W e believe that there

•;1 g
- 8 -

J-*-^

Rico. It has an organization of 1, 343 people, including financial specialis

engineers, appraisers, management consultants and supervisors. It has

well established national and regional advisory boards. We believe it would

be very much in the interest of the Government and of small business from

every standpoint, economy of operation, experience, clear definition of

responsibilities and service to small business to sh&e^this organization rat

than to set up a new one.

S.2160 would use Federal Reserve funds for the purchase of equity

capital in national investment companies and would permit national invest-

ment companies to purchase equity capital in small business concerns. ->

C^ S. 3191 would use Federal Reserve funds to provide equity capital in

capital banks and would authorize the capital banks to invest in equities of

small business investment associations.
•-s
S. 3651 would authorize the Small Business investment Administration

to supply equity capital for small business investment companies. As

- 7-

its own regional offices paralleling and, in m a n y respects, duplicating the

Smajl Business Administration. We feel that there are several objections

to such a plan. It would pose a difficult question of definition and division

of responsibility, between the new agency and SBA, not only with respect

to financial assistance but also in such areas as management counseling,

assistance in procurement and other things outside the strictly financial

field. It would almost certainly result in some overlapping, duplication

and competition between the two agencies. It would be costly to the Govern-

ment and, in addition to everything else, it would take so long to recruit

and build a competent organization that the benefits of the program would

not be available to small business in any substantial degree for a very con-

siderable length of time. We would strongly urge that any program which

may be decided upon be placed in the hands of an existing agency which

could get the show on the road without delay. The Small Business Admin-

istration has been in existence for four and one half years. It has 52 region

and field offices in the Continental United States, Alaska, Hawaii and Puerto

-6 -

would favor permission to incorporate with capital as small as $100,000
there \Qfr

provided thatJ& mustJsa^e at least ten stockholders and that no one stock-

holder could hold a dominant interest. We would favor allowing such

companies to be organized wherever a group of individuals would supply

the capital subject only to the approval of the government agency that
/
would administer the program.

S. 3191 would establish what would be tantamount to a new banking

system, paralleling the Federal Reserve System, with large capital and

high overhead. We believe that this would be an unnecessarily elaborate

and extravagant program, extremely costly to the Government and far

greater in scope than would be necessary to take care of any need that is

now indicated. Moreover it would permit the capital banks to make direct

loans in competition with the Small Business Administration and for longer

periods of time.

S.3651. This bill has some very good features but we think its most

serious defect is that it would create a new and independent agency with

~ 5

mtmLmmm.

business is to encourage by every reasonable means the use of private

capital without subsidies.

The bills before your committee all have in general the same objec-

tive, which is to make long-term loans and equity capital more readily

available to meritorious small business concerns. They differ only in

the methods proposed. We are in accord with the objective, and with

many of the features of the different bills. With some we do not agree.

Rather than to discuss the provisionSof each bill in detail, I think

it will save the time of the committee if I simply make some general

comments in the light of the principles which I have mentioned previously.

S. 2160 would create national investment companies with minimum

capital of $5 million to be provided by the Federal Reserve Banks to the

extent necessary and would permit only one such company to be established

in each state. Our feeling is that it would be uiuwfc more desirable, to pe

mit investment companies to be organized with much smaller capital, sub-

scribed for by private sources and without geographical limitation. We

- 4 would own equities in small business concerns should, in our opinion, be

rigidly restricted to loans without any purchase of stock.

Third, w e believe that Government funds should be used only where

private capital is not available so that the Government will not be in the posi-

tion of either competing directly, or subsidizing competition, with established

private business.

Fourth, we believe that federal funds should not be used in such a way

as to (gajfeGera^affiBtesaa?) assist business concerns to m o v e from one area to

another. Competition between states and between industrial areas is a desir-

able factor in our free economy, but the Federal Government should not

assist one area at the expense of another*

It should be remembered also that every small business which receives

financial assistance from the Government is in competition with some other

small business which has financed itself privately and has developed under

sound and prudent management without calling on the Government for heljp.

The best contribution the Government can m a k e to the welfare of small

- 3 -

;?4

of just what its elements are, w e feel that any program that is adopted should

be as simple as possible, but flexible enough to permit modifications?, cnaneres

or expansion when the results of actual experience can be appraised. We be-

lieve that it would be a mistake to create a new governmental agency with its

own overhead, personnel and administrative costs. Any new governmental

activity in this field should be undertaken by an existing agency in order to

avoid a confusion of responsibility and functions and an unnecessary burden

on the federal budget, and also to get quicker results.

The second principle which w e consider important is that the Govern-

ment should not put itself in the position of owning directly, or indirectly, an

equity in private business. The dangers inherent in such equity ownership

seem too obvious to discuss at length. Stock holdings would involve questions

of division of profits, participation in and perhaps domination of management,

government competition with private business, and in general an invasion into

the field of private enterprise. Any advance of federal funds to small business

concerns, groups of small business concerns, or investment companies which

- 2-

to small business by the Government be deferred until the findings of a study

then contemplated by the Federal Reserve Board, would be available. The

reports on those parts of the study which have been completed have been sub-

mitted to the Committee and, although m u c h m o r e is to be learned from the

still unfinished part, it is now possible to draw at least some tentative con-

clusions which help to place the problem in proper perspective.

The first of these conclusions is that there is no apparent shortage in

the availability of short-term or even intermediate-term credit to small busi

ness. If there is a gap anywhere in the availability of small business financing

it would appear to be in the area of long-term loans and equity capital. The

general acceptance of that conclusion is evidenced by the bills now under con

sideration.

In trying to find the best way to fill that gap, w e believe that there are

several basic principles which should govern any assistance or participation

on the part of the Government.

The first is that since there is no way at the

present time to measure the magnitude of the problem, nor even to be certain

.26
STATEMENT OF LAURENCE B. ROBBINS, ASSISTANT
S E C R E T A R Y O F T H E T R E A S U R Y , B E F O R E T H E SUBC O M M I T T E E O N S M A L L BUSINESS O F T H E S E N A T E
C O M M I T T E E O N BANKING A N D C U R R E N C Y
APRIL 24, 1958
.„
_>

( : " " - " " i
MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:

I welcome this opportunity to appear before your Subcommittee to

submit the comments of the Treasury Department on the financing of small

business in connection with the several bills which are before your Com-

mittee for consideration. The Treasury is keenly aware that the smaller

businesses of our nation have been, and are, a dynamic force in our free

competitive economy. Each small enterprise makes its contribution to the

development of new ideas, new processes and the maintenance of a continuing

broad base of competition. W e feel that it is highly important for the Govern-

ment to try to determine as clearly as possible what the financial and other

needs of small business are and, to the extent that it can properly do so, to

see that those needs are met.

In our testimony before this Committee last June we urged that any

decision as to the method by which further financial assistance should be given

TREASURY DEPARTMENT
Washington
STATEMENT OF
SECRETARY OF
SUBCOMIDITTES
COMMITTEE ON

LAURENCE B. ROBBIUS, ASSISTANT
THE TREASURY, BEFORE THE
ON SMALL BUSINESS OF THE SENATE
BANKING AND CURRENCY
APRIL 24, 1953

MR. CHAIRMAN AND MEMBERS OF THE SUBCOMMITTEE:
I welcome this opportunity to appear before your Subcommittee
to submit the comments of the Treasury Department on the financing
of small business in connection with the several bills which are
before your Committee for consideration. The Treasury is keenly
aware that the smaller businesses of our nation have been, and are,
a dynamic force in our free competitive economy. Each small
enterprise makes its contribution to the development of new ideas,
new processes and the maintenance of a continuing broad base of
competition. \Je feel that it is highly important for the
Government to try to determine as clearly as possible what the
financial and other needs of small business are and, to the extend
that it can properly do so, to see that those needs are met.
In our testimony before this Committee last June we urged that
any decision as to the method by which further financial assistance
should be given to small business by the Government be deferred
until the findings of a study, then contemplated by the Federal
Reserve Board, would be available. The reports on those parts of
the study which have been completed have been submitted to the
Committee and, although much more is to be learned from the still
unfinished part, it is now possible to draw at least some tentative
conclusions which help to place the problem in proper perspective.
The first of these conclusions is that there is no apparent
shortage in the availability of short-term or even intermediateterm credit to small business. If there is a gap anywhere in
the availability of small business financing, it*would apnear to
be in the area of long-term loans and equity caoital. The
general acceptance of that conclusion is evidenced by the bills
now under consideration.
In trying to find the best way to fill that gap, we believe
that there are several basic principles which should govern any
assistance or participation on the part of the Government. The
first is that since there is no way at the present time to
measure the magnitude of the problem, nor even to be certain of
A-225
just what its elements are, we feel that any program that is
adopted should be as simple as possible, but flexible enough to

permit modifications, changes or expansion when the results of
actual experience can be appraised. We believe that it would be
a mistake' to create a new governmental agency with its own overhead, personnel and administrative costs. Any new governmental
activity in this field should be undertaken by an existing agency
in order to avoid a confusion of responsibility and functions and
an unnecessary burden on the federal budget, and also to get
quicker results.
The second principle which we consider important is that the
Government should not put itself in the position of owning directly,
or indirectly, an equity in private business. The dangers
inherent in such equity ownership seem too obvious to discuss at
length. Stock holdings would Involve questions of division of
profits, participation in and perhaps domination of management,
government competition with private business, and in general an
Invasion into the field of private enterprise. Any advance of
federal funds to small business concerns, groups of small
business concerns, or investment companies which would own equities
in small business concerns should, in our opinion, be rigidly
restricted to loans without any purchase of stock.
Third, we believe that Government funds should be used only
where private capital is not available so that the Government will
not be In the position of either competing directly, or subsidizing competition, with established private business.
Fotirth, we believe that federal funds should not be used in
such a way as to assist business concerns to move from one area
to another. Competition between states and between Industrial
areas is a desirable factor in our free economy, but the Federal
Government should not assist one area at the expense of another.
It should be remembered also that every small business whieh
receives financial assistance from the Government is in
competition with some other small business which has financed itself
privately and has developed under sound and prudent management
without calling on the Government for help. The best contribution
the Government can make to the welfare of small business is to
encourage by every reasonable means the use of private capital
without subsidies.
The bills before your committee all have In general the same
objective, which is to make long-term loans and equity capital more
readily available to meritorious small business concerns. They
differ only in the methods proposed. We are In accord with the
objective, and with many of the features of the different bills.
With some we do not agree.
Rather than to discuss the provisions of each bill in detail,
I think it will save the time of the committee if I simply make
some general comments in the light of the principles which I have
mentioned previously.

m 3 S. 2l6o would create national Investment companies with
minimum capital of $5 million each to be provided by the
Federal Reserve Banks to the extent necessary and would permit
only one such company to be established in each state. Our
feeling is that it would be more desirable to permit investment
companies to be organized with much smaller caoital, subscribed
for by private sources and without geographical limitation. We
would favor permission to incorporate with capital as small as
$100,000 provided that there must be at least ten stockholders
and that no one stockholder could hold a dominant interest. We
would favor allowing such companies to be organized wherever
a group of Individuals would supply the capital,subject only to
the approval of the government agency that would administer the
program.
S. 3191 would establish what would be tantamount to a new
banking system, paralleling the Federal Reserve System, with
large capital and high overhead. We believe that this would be
an unnecessarily elaborate and extravagant program, extremely
costly to the Government and far greater in scope than would be
necessary to take carecf any need that is now indicated. Moreover
it would permit the capital banks to make direct loans in
competition with the Small Business Administration and for longer
periods of time.
S. 3651. This bill has some very good features but we think
its most serious defect is that it would create a new and
independent agency with its own regional offices paralleling and,
in many respects, duplicating the Small Business Administration,
We feel that there are several objections to such a plan. It
would pose a difficult question of definition and division of
responsibility and functions between the new agency and SBA, not
only with respect to financial assistance but also in such areas
as management counseling, assistance in procurement and other
things outside the strictly financial field. It would almost
certainly result in some overlapping, duplication and competition
between the two agencies. It would be costly to the Government
and, in addition to everything else, it would take so long to
recruit and build a competent organisation that the benefits of
the program would not be available to small business in any
substantial degree for a very considerable length of time. We
would strongly urge that any program which may be decided upon be
placed in the hands of an existing agency which could get the
show on the road without delay. The Small Business Administration
has been in existence for four and one half years. It has 52
regional and field offices in the Continental United States,
Alaska, Hawaii and Puerto Rico. It has an organization of 1,3^3
people,
including
financial
specialists,
engineers,
appraisers,
utilize
definition
from
management
national
very
much
every
this
and
in
of
consultants
standpoint,
organization
the
regional
responsibilities
interest
advisory
economy-of
andof
rather
supervisors.
the
boards.
and
Government
than
operation,
service
toWe
It
set
believe
to
has
and
up
experience,
small
well
of
a new
it
small
business
established
would
one.
business
clear
be
to

- k-

-LdU

S. 2160 would use Federal Reserve funds for the purchase of
equity capital in national investment companies and would permit
national investment companies to purchase equity capital in
small business concerns. S. 3191 would use Federal Reserve
funds to provide equity capital in capital banks and would
authorize the capital banks to invest In equities of small
business investment associations. S. 3^51 would authorize the
Small Business Investment Administration to supply equity capital
for small business investment companies. As previously indicated,
we believe that Government funds should be used exclusively for
loans and not for the purchase of equities.
Some of the bills provide for loans to small business concerns
running as long as 30 years with an additional 10 years for
orderly liquidation. We believe that a 10 year loan to a small
business Is a long-term loan. In setting up a 10 year loan the
fixed repayment schedule need not always require evenly
distributed amortization nor necessarily complete amortization
during the 10 year period because it may be expected that
contingent payments from earnings or payments from other sources
will supplement the fixed payments and retire the balance within
10 years, or reduce it to an amount which can be refinanced
privately. If an additional 10 years is allowed, if necessary
for orderly liquidation, we feel that any legitimate needs of a
small business concern would be provided for.
It is not clear in some of the bills that the proposed
financial assistance shall be available only to small business
concerns. We believe that there should be such a requirement and
that any investment association should not be permitted to
invest more than $250,000 in any one small business enterprise.
We also believe that in order to diversify the risk, no investment
association should be permitted to invest more than 20$ of its
capital and surplus in any single business concern.
Most, If not all, of the principles which I have endeavored
to express are Incorporated in S. 3643.
Mr. Dan Throop Smith will submit a separate statement on the
tax provisions of the various bills.
0O0

- 7 '

1 1"\
mL <J mC

(3) That the taxpayer be given the option of
paying the estate tax over a period of up to ten
years in cases where the estate consists largely of investment^ in closely held business, c nni?ni^frn
(k) That original investors in small business be
given the right to deduct from their incomes, up to
some specified maximum, a loss, if any, realized on a
stock investment in such business. At the present
time the deduction of such losses from income is subject
to the general limitation on net capital losses of $1,000.
As Secretary Anderson indicated to the House Ways and Means Committee
earlier this year, we have been glad to recommend this tax relief for
small business because of the importance of the new and small businesses
in our economy. Specific legislation to carry out these Administration
recommendations for small business tax relief hfifi jurt hrrn introduced
up,v_? 2 fa—
f by the Chairman and the Ranking Minority Member of the Ways and Means
Committee. We believe that the specific proposals for tax changes will j
give important relief to small businesses for the revenue loss involved.

-6 the tax laws in 1954 were of special importance to small business. These
include, for example, the liberalized depreciation methods, improved loss
carryovers, and clarification of the tax on surplus accumulations.
In 1956 President Eisenhower appointed a Cabinet Committee on Small
Business whose members were instructed to investigate the whole range
of small business problems, including taxation, and to formulate a constructive program to increase opportunities for small businesses to
prosper and grow. A Progress Report of the Cabinet Committee reviewed
the problems and existing Federal policies and programs in this area,
and submitted recommendations in various fields. Some of these recommenda
tions have already been carried out by administrative policies. Legislative proposals with respect to other recommendations are now before
the Congress.
On July 15, 1957, the President sent a letter to the Chairman of
the House Ways and Means Committee which discussed in part the tax
recommendations of the Cabinet Committee on Small Business, as well as
additional suggestions. Specifically those recommendations were:
(1) That businesses be given the right to utilize,
for purchases of used property not exceeding $50,000 in
any one year, the formulas of accelerated depreciation
that were made available to purchasers of new property
by the Internal Revenue Code of 195^.
(2) ihat corporations with, say, ten or fewer ,
^A**X °^

stockholders be given the option of being taxed atTTf
'bhu^-JiiiB© partnerships^

*Vv-4fcA^v,y^v

-5 1.

A. y y

The proposed investment companies would be allowed an

ordinary loss deduction, rather than a capital loss
deduction, on losses realized on convertible debentures,
including stock received pursuant to the conversion
privilege. acquired in connection with the provision of
equity capital for small business concerns. The loss
deduction would include losses due to worthlessness
as well as those arising from sale or exchange of the
security.
2. Taxpayers investing in the stock of the proposed investment companies would be allowed an ordinary loss deduction rather than a capital loss allowance on losses
arising from worthlessness or sale of such stock.
3. The proposed investment companies would be allowed a
deduction of 100 percent of dividends received from a
taxable domestic corporation rather than the 85 percent
deduction allowed corporate taxpayers generally.
These tax provisions contained both in S. 3651 and in S. 36^3,
are consistent with MMPgeimHfc-^^gi recommendations which the Adminis
tration has made in connection with its small business tax proposals
W

if ft

and elsewhere. We endorse this tax approach. Z-w^--Jf'^' *
In developing its general tax program, the Treasury Department
under this Administration has been very much aware of the financial and

competitive problems which confront small business owners and investors.

Many of the reforms adopted in connection with the general revision of
^
\.f€.
\ <% A "V""'^ ,/»%,*

.1 v* >* V W * - j

~ - y. '

jj * V '4

'\,'"*f {^t@^^v^^M0<*y*

££}«#

„«J? L^kvyJGL 7<y^ J&v*y

SL^V-^""

""J.

Vi^yi** -~H*A

- k-

with respect to earnings arising from loan operations conducted through
such an investment company or association afe an intermediary than on
similar loan operations conducted directly.
The proposed special tax treatme/t is based on a complex extension
treatment
under the
investand liberalization
of regulated
the "conduit%

ment company provisions. However, since the proposed investment companies

or associations would be exempt not only on their distributions to shareholders but also on amounts of retained earnings put into a tax-exempt
reserve, they would be substantially tax-exempt^.

they

not

^MHBBttiBai
incomMMPSTshareholders. This would be
in fact

Crhd^if-Jty. **€*$€>
inconsistent with the
provisions are based.

on which

the regulated investment company

There have been many proposals for special tax-

free reserves which the Treasury Department has consistently opposed.

The adoption of the proposed tax-free reserve treatment for these invest-

ment companies or associations would constitute an undesirable precedent
for similar treatment elsewhere.
The proposed legislation under S. 3651 follows a different approach

from S. 2160 and S. 3191 iu its method of providing special tax treatment

for the investment companies which it would sponsor and investors in such
companies. >Tax features similar to those contained in S. 3651 are also
embodied in S. 36*4-3.
on the Dating

ects o£,,the"

tive measures. The follow-/

;s are limited

e tax provisi

nich are thelsame; under
* ,-\y

J^^jneirtearcr^^
wiyLnclude three specific provisions:

*?%e *%y%tf/' +mm****fL

"J 1 £

Xy^

- 3 conditions would permit the offset of capital losses against ordinary
income in the absence of offsetting capital gains. Corporations generally
including regulated investment companies, are not permitted to deduct
capital losses from income other than their capital gains, but are allowed
a five-year carryforward of capital losses against capital gains. The
proposed loss treatment for the investment companies or associations is
tied in with the operation of specified charges and additions to the
special tax reserve and involves various complex adjustments.
The usual tests for qualifying for regulated investment company
treatment are also liberalized in the case of the proposed investment
companies or associations. The general requirement that 90 percent of

the gross income consist of specific types of investment income (dividends,
interest, and gains from sale of securities) is reduced to 75 percent for
the proposed companies or associations. This would permit these organizations to receive substantial amounts from service fees and charges and

other non-investment sources, and yet qualify for the special tax treatmerf
Provision is also made for waiving, in the case of the proposed investment
companies or associations, the usual requirements applicable to regulated
investment companies relating to diversification and liquidity of investments, subject to the approval of the banking authorities having jurisdiction under the respective bills.
These tax provisions would probably relieve the proposed investment
companies and associations from Federal income taxes for a considerable
if not indefinite period, without actually conferring tax-exempt status
on them. ]tf^ould also have the effect of extending to participating
commercial banks and other lending institutions more favorable treatment

DRAFT

R.E.Slitor

V22/5^

"» '1~7
mL. y

Statement by Dan Throop Smith, Deputy to the Secretary of the Treasu^r
before the Subcommittee on Small Business of the Senate Committee on Bank^-j£-**W**+*
ing and Currency
UsL-&7-&&br&r~i^^
A
for
makfe .,eautty.jB«atti^

small-

h\m\§^^^Sm^om^mwB^^vil 2y> 1958, 0f° accompany statement by Assistant
Secretary Laurence B. Robbins)
Mr. Chairman and Members of the Committee:
The Treasury Department appreciates having this opportunity to comment on the tax provisions of legislative proposals now under consideration by this Committee to provide additional facilities for the financing
of small businesses.

Si*m.;h

OA~>
S. 2160 and S. 3191 both provide.special tax treatment for the

A
investment companies or associations to be established under these bills.
In general, this would permit these organizations to be treated as regulated investment companies. As such, they would be exempt from tax on the
portion of their income or capital gains distributed to shareholders.
However, the treatment accorded the proposed companies or associations
would be more liberal in significant respects than the usual regulated
investment company provisions.
In addition to being exempt on their distributed earnings, these
companies or associations would be allowed to retain and accumulate free
of tax a substantial fund of earnings in a special tax reserve. The
operation and tax treatment of this reserve, termed "national investment
company reserve" under S. 2160 and "small business investment association
reserve" under S. 3191, would be the same under either bill. The
companies or associations would be allowed a tax deduction for certain

TREASURY DEPARTMENT
Washington

-; 7Q
±yy

STATEMENT BY
SECR3TARY OF
SUBCOMMITTEE
COMMITTEE ON

DAN THROOP SMITH, DEPUTY TO THE
THE TREASURY, BEFORE THE
ON SMALL BUSINESS OF THE SENATE
BANKING AND CURRENCY
APRIL 24, 1958
(To accompany statement by Assistant Secretary Laurence B. Robbins)

MR. CHAIRMAN AND MEMBERS OF THE COMMITTEE:
The Treasury Department appreciates having this opportunity to
comment on the tax provisions of legislative oroposals now under
consideration by this Committee to provide additional facilities
for the financing of small businesses.
S. 2160 and S. 3191 both provide similar special tax treatment
for the investment companies or associations to be established under
these bills. In general, this would permit these organizations to
be treated as regulated Investment companies. As such, they would
be exempt from tax on the portion of their income or capital gains
distributed to shareholders. However, the treatment accorded the
proposed companies or associations would be more liberal in
significant respects than the usual regulated investment company
provisions.
In addition to being exempt on their distributed earnings, these
companies or associations xtfould be allowed to retain and accumulate
free of tax a substantial fund of earnings in a special tax reserve.
The operation and tax treatment of this^reserve, termed "national
investment company reserve" under S. 2160 and "small business
investment association reserve" under S. 3191, would be the same
under either bill. The companies or associations would be allowed
a tax deduction for certain additions to the reserve and would be
allowed a dividends-received deduction on their dividend income
which was used to make further additions to the reserve fund.
Regulated investment companies under present law are not entitled
to the dividends-received deduction and are fully subject to
tax on their retained earnings.
The proposed special tax reserve Is not to exceed 50 percent of
the invested capital of the company or association. It is also
provided that the reserve shall" not exceed the actual amount of the
accumulated earnings and profits of the company or association.
Additions to the reserve up to 20 percent of the Invested capital
are allowed as a tax deduction without regard to the source of
A-226
such income. Further additions to the reserve up to the over-all
maximum of 50 percent of the invested capital qualify for the

1 ?Q

- 2-

A. y y

85 percent intercorporate dividends-received deduction, provided the
company or association has a corresponding amount of dividend Income
from domestic corporations. These provisions would have the effect
of relieving the proposed investment companies or associations of
the requirement of distributing 90 percent of their income to
shareholders with respect to the amounts of dividend as well as
other income deposited In the reserve. Regulated investment
companies generally are required to distribute 90 percent of all
of their ordinary Income in order to qualify for the special
method of tax treatment.
Both S. 2160 and S. 3191 also provide that the proposed investment companies or associations, unlike regulated investment
companies, would be entitled to the equivalent of net operating
loss carryovers, which would be more liberal than those available
to corporations generally. In addition, they provide a special
treatment of capital losses which under certain conditions would
permit the offset of capital losses against ordinary income in the
absence of offsetting capital gains. Corporations generally,
including regulated investment companies, are not permitted to
deduct capital losses from income other than their capital gains,
but are allowed a five-year carryforward of capital losses against
capital gains. The proposed loss treatment for the investment
companies or associations is tied in with the operation of specified
charges and additions to the special tax reserve and involves
various complex adjustments.
The usual tests for qualifying for regulated Investment company
treatment are also liberalized in the case of the proposed investment
companies or associations. The general requirement that 90 percent
of the gross income consist of specific types of investment income
(dividends, interest, and gains from sale of securities) is reduced
to 75 percent for the proposed companies or associations. This
would permit these organisations to receive substantial amounts
from service fees and charges and other non-investment sources, and
yet qualify for the special tax treatment. Provision is also made
for waiving, in the case of the proposed investment companies or
associations, the usual requirements applicable to regulated
investment companies relating to diversification and liquidity of
investments, subject to the approval of the banking authorities
having jurisdiction under the respective bills.
These tax provisions would probably relieve the proposed
investment companies and associations from Federal income taxes for
a considerable if not Indefinite period, without actually conferring
tax-exempt status on them. They would also have the effect of
extending to participating commercial banks and other lending
institutions more favorable treatment with respect to earnings
arising from loan operations conducted through such an investment
operations
company or conducted
association
directly.
as an intermediary than on similar loan

140
- 3The proposed special tax treatment Is based on a complex
extension and liberalization of the "conduit" or "pass-through"
treatment under the regulated Investment company provisions.
However, sinee the proposed investment companies or associations
would be exempt not only on their distributions to shareholders
but also on amounts of retained earnings put Into a tax-exempt
reserve, they would be substantially tax-exempt even where they
did not In fact pass their income on to shareholders. This would
be inconsistent with the conduit principle on which the regulated
investment company provisions are based. There have been many
proposals for special tax-free reserves which the Treasury
Department has consistently opposed. The adoption of the proposed
tax-free reserve treatment for these investment companies or
associations would constitute an undesirable precedent for similar
treatment elsewhere.
The proposed legislation under S, 3651 follows a different
approach from S. 21o0 and S. 3191 in its method of providing
special tax treatment for the investment companies which it would
sponsor and investors in such companies. Tax features similar to
those contained in S. 3651 are also embodied in S. 3643. These
tax features include three specific provisions:
1. The proposed investment companies would be alloiTed an
ordinary loss deduction, rather than a capital loss
deduction, on losses realized on convertible debentures,
including stock received pursuant to the conversion
privilege, acquired in connection with the provision of
equity-type capital for small business concerns. The
loss deduction would Include losses due to itforthiessness
as well as those arising from sale or exchange of the
security.
2. Taxpayers Investing in the stock of the proposed
investment companies would be allowed an ordinary loss
deduction rather than a capital loss allowance on
losses arising from worthlessness or sale of such stock.
3. The proposed investment companies would be allowed a
deduction of 100 percent of dividends received from a
taxable domestic corporation rather than the 85 percent
deduction allowed corporate taxpayers generally.
These tax provisions contained both in S. 3651 and in S. 3643,
are consistent with recommendations which the Administration has
made in connection with its small business tax proposals and
elsewhere. We endorse this tax approach. The provisions should
be helpful in increasing the amount of funds available to the
proposed Investment companies and they are consistent with
other tax recommendations and the general corporate tax law.

-4-

•i A •*

In developing its general tax program, the Treasury Department
under this Administration has been very much aware of the
financial and competitive problems which confront small business
owners and investors. Many of the reforms adopted in connection
with the general revision of the tax laws in 1954- were of
special Importance to small business. These include, for example,
the liberalized depreciation methods, improved loss carryovers,
and clarification of the tax on surplus accumulations.
In 1956 President Eisenhower appointed a Cabinet Committee on
Small Business whose members were instructed to investigate the
whole range of small business problems, including taxation, and
to formulate a constructive program to increase opportunities
for small businesses to prosper and grow. A Progress Report of
the Cabinet Committee reviex^ed the problems and existing Federal
policies and programs in this area, and submitted recommendations
in various fields. Some of these recommendations have already
been carried out by administrative policies. Legislative proposalswith respect to other recommendations are now before the Congress.
On July 15, 1957, the President sent a letter to the Chairman
of the House Ways and Means Committee which discussed in part the
tax recommendations of the Cabinet Committee on Small Business,
as well as additional suggestions. Specifically those
recommendations were:
1. That businesses be given the right to utilize, for
purchases of used property not exceeding $50,000 in
any one year, the formulas of accelerated depreciation
that were made available to purchasers of new property
by the Internal Revenue Code of 1954.
2, That corporations with, say, ten or fewer stockholders
be given the option of being taxed In a manner similar
to partnerships.
3. That the taxpayer be given the option of paying the
estate tax over a period of up to ten years in cases
where the estate consists largely of investment in
closely held business.
4. That original investors in small business be given the
right to deduct from their incomes, up to some
specified maximum, a loss, if any, realised on a stock
investment In such business. At the present time the
deduction of such losses from income is subject to the
general limitation on net capital losses of $1,000.
As Secretary Anderson Indicated to the House Ways and Means
Committee earlier this year, we have been glad to recommend this tax
relief for small business because of the importance of the new and
small businesses in our economy. Specific legislation to carry, out
these Administration recommendations for small business tax relief
was introduced on April 22 by the Chairman and the Ranking Minority
Member of the Ways and Means Committee. We believe that the specific
proposals for
businesses
fortax
thechanges
revenuewill
lossgive
involved.
oOn important relief to small

142
TREASURY DEPARTMENT
Washington
FOR RELEASE P. M. NEWSPAPERS
Friday, April 25. 1958
Remarks by Treasury Secretary Robert B.
Anderson on Law Day, University of Texas,
Austin, Texas, 9:30 a. m., Friday,
April 25, 1958.
A free people protects both its political freedom at
the ballot box and its economic freedom at the market place.
A free society requires not only the right but the duty of
individual participation. Our political participation is
through political parties; our economic participation is
through the opportunity to work at jobs of our own choosing;
through the widespread distribution of the fruits of the
economy; through a high standard of living; and through
ownership of the means of production.
As individuals we participate in ownership in a variety
of ways. Approximately 9 millions of our people own shares
in the country's corporations. There are 3 million farmers
who own their own farms. There are more than k million
business enterprises owned by individuals or small groups.
There are more than 30 million families who have bank checking
accounts, and almost that many families have savings accounts.
There are over 100 million people who own life insurance.
There are 30 million families who own their own homes, almost
40 million families owning automobiles, and innumerable other
millions of owners of washers, refrigerators, radios, TV sets
and other equipment quite apart from capital goods which in
themselves generate further production.
While each segment of the economy seeks to benefit
through profit and wages, there must be a general acceptance
of the belief that despite self-interest the operations of all
groups in our economy must be conducted in the interest of the
public good.
Our social institutions we insure through a government
by the rule of law. We recognize that behind that law are
certain immutable truths. Our laws are framed with a goal
of translating these truths Into rules that are applicable
A-227
to everyday living.

- 2-

143

It has always been necessary to seek to find a balance
between absolute freedom and absolute control. This balance
cannot be a static one; it must constantly be adjusted as
times change and as society becomes more complex. Also, our
changing relationships with other nations must frequently be
modified and expressed in terms of new formal international
cooperation.
In the economic world we have something of the same
problem. There was a time when men of necessity tried very
hard to be self-sufficient. As society grew, it was felt that
certain "economic laws" had validity, and that one of the most
important of these was a reliance on self-interest as the best
guarantee of the general welfare. It was generally thought
that if each man pursued his own interest this "natural" law
would work automatically to accomplish equity between the
workers and their employers and to bring the greatest good to
society as a whole. Relations between nations likewise
proceeded pretty much on the same principle — that self-interest
generally provided the best guide to policy and action.
As the industrial revolution spread through more and more
areas of economic activity, it came to be recognized that
complete "laissez faire" was an unrealistic concept — that
in few instances was economic power expressed in terms of
individuals acting in isolation from others. The very fact
that people are coming to express themselves through groups,
however, emphasizes rather than minimizes the importance and
the responsibility of the individual. Because group action
is essential, the role the individual must play in the group,
if he is to avoid surrendering his rights as a member of a
free society, becomes increasingly vital.
In the International field it took much longer for a
policy of national isolation to be seen for what it was —
both unrealistic and outmoded. But the coming of the air
age finally drove this fact home; in both our Internal and
external relations it is now pretty generally recognized that
we have moved well into a period in which both people and
nations must try to meet their responsibilities working with
other people and other nations.
The aim of the economic machinery, the ownership of
which is so diversely spread, is to supply the goods and
services that our people require, at prices that not only
make possible effective demand but leave room for experimentation
and Innovation, for the process of change, for the creation of

- 3those new wants and new decisions to buy which are essential
to progress. Despite the widespread ownership in this country,
we have an increased characteristic of grouping.
Most American production, for example,•is achieved
through corporations where individuals contribute their funds
but entrust the production and distribution processes to
managerial efforts. Labor expresses its desires and exercises
its powers through unions. Farmers organize into associations
or join cooperative marketing organizations. Businessmen,
both as individuals and as companies, work together through
associations to promote their particular Interests. Geographical
communities express themselves through Chambers of Commerce
or Boards of Trade.
All through the spectrum of business, this grouping
continues; and in recent years it has pushed increasingly
across national borders. Certain of the European countries
are trying to join their efforts in the European common market
and others are seeking to develop a free trade area. The
nations of the free world are entering into trade agreements
and working out international understandings with respect to
the distribution of goods among themselves and in and out of
the iron curtain bloc.
This coming together of group activity develops certain
tendencies. In the first place, the wide diffusion of ownership
puts increasing emphasis on managerial control. And entrusting
decisions to management has a tendency to lessen a consciousness
of individual participation and to promote the feeling that the
Government in trying to maintain a balance between economic
groups can cure all economic ills.
Yet, If we are to have an economic system that is to
succeed, the American people must accept economic as well as
political duties, economic as well as political responsibilities.
And this sense of responsibility must be keen enough and well
enough understood so that it becomes an effective influence
in determining the use of power by larger groups. Since we
act as groups, we must have, In addition to laws and regulations
which govern their action, a basic adherence to a principle of
economic ethics that transcends the advantages to the group
membership. We must recognize correlated duties to other
groups and the public as a whole. The economic control
relinquished by the individual in our complex American economy
has not passed automatically to "the Government". It is
finally In the hands of people.

145
- 4While as a matter of public policy we try to maintain
a balance between the desires and powers of different elements
of the economic system, we must be sure that we give maximum
play to freedom of choice, liberty of action, the initiative
of the individual, and the dynamic compulsion that stems from
Incentives. In a free,competitive society we should recognize
that Government has an important role but that it has, also,
its limitations. Government, for example, may open up and
make available certain economic potentialities. This we do
through the building of roads, the development of waterways,
the stimulation of means of transportation, and the performance
of like functions. At the same time, we have taken steps to
protect employment, to insure the bargaining rights of individuals,
to avoid monopolies, to require certain minimum standards of
safety, to mitigate the hardships of unemployment and old age
in an industrial society, and generally to insure the equality
of opportunity. Here again, we are walking the narrow road
between the proper functions of government which means some
surrender of individualism to the economic good and the
maintenance of individual freedom and incentives.
Whatever the changed distribution may be in the achievement
of the balance, I think we might all agree that it should be
accomplished through the Government operating by rule of law
rather than by fiat or decree.
In the words of John Locke, our goal should be "not to
abolish or restrain, but to preserve and enlarge freedom".
How much have we abolished, and how much have we preserved?
Even more fundamental is the question of how much must be
abolished in order to "preserve and enlarge" the scope of
freedom in an ever-changing society? Strictly speaking, we
do not operate under a free enterprise system — freedom for
every man "to do what he lists," to quote Locke once more.
Certain individual rights had to be curtailed in the interests
of the larger group. We have a competitive price system; but
in order to preserve its competitive aspects we found that
we had to take away some part of the freedom of individuals
to practice unrestrained competition.
Since the first experiments in democracy, in fact, we
have been made to realize in many different ways that our
liberties carry with them certain ethical responsibilities
for not abusing these liberties in order to promote selfish
interests.

lib
- 5 For example, it is taken for granted that we may invest
our savings in any way we choose. The corporation whose
shares we may have bought, on the other hand, is not at liberty
to conduct its business in any way it wants. We have set up
many kinds of rules to assure fair competition, to protect
the small investor and stockholder.
All these things are serious limitations on individual
liberty and on economic power. Because this is true, each
one has had to battle for acceptance. But, however fumbling
we may have been in going about it, our goal has always been
the one expressed by John Locke of submitting to certain
restrictions in order to preserve and enlarge the environment
in which society as a whole could function effectively. The
difficulties in every age of deciding which limitations will
promote freedom and which will limit it unduly are enormous.
But these are just the decisions which we must make as
responsible members of a democratic society.
We must recognize too that the issues involved never remain
quite the same. Technology and innovation may move with
lightning speed to change the terms of our problem, almost
overnight. In the words of Mr. Justice Cardozo, "Hardly is
the ink dry upon our formula before the call of an unsuspected
equity — the urge of a new group of facts, a new combination
of events — bids us blur and blot and qualify and even, it
may be, erase".
We have some particular situations with which we must
concern ourselves:
The first is that we live In a world of tensions. There
is a disturbing and very real competition between nations on
a physical basis. The drive for world domination on the part
of an aggressor nation is not a new development in history, but
it comes armed in our own time with a new potential for
destruction. There is another new development — or rather
a development which is taking new forms: the competition among
nations now extends into the economic structure. And at the
root of both our physical and economic tensions is a wide
divergence in ideology — political, social, and economic.
We must be relentless in seeking the ways of peace. The
world must be spared, if possible, the holocaust of atomic war.

- 6-

147

Secondly, our national life is not likely to become
more simple, either politically or economically. It is
very much more likely to become increasingly complicated.
We must learn to live and to work within these complications
in order to satisfy both our national needs and the reciprocal
requirements of membership in the community of free nations.
Finally, we must accomplish both of these responsibilities
within the framework of a free competitive system through
voluntary cooperative efforts, or we will gradually be brought
to submit more and more to regimentation imposed by a central
authority.
In our day the problem is made more difficult because for
a long time we may well be engaged in a cold war. If we were
engaged in an active war, all of the normal rules both of
economics and of society would be ignored and we would temporarily
submit to the kind of regimentation that would bring all of our
forces into play in order to win. If we were wholly at peace
there would be a change of emphasis and in our efforts to help
promote sustainable growth, we would be directing more of our
economic activity to the making of things to be used and
enjoyed by man in increasingly better living.
In a cold war we are somewhat in between. We want to
produce the goods and services for maintaining a higher standard
of living. We want to win in both the ideological and the
economic battle for uncommitted countries. We want to avoid
dislocations and maladjustments in our economic system without
surrendering more than the necessary minimum of freedoms. At
the same time, we willingly submit to the fact that a large
part of our national effort goes into the making of things
which are essential for governments for waging war, but which
are of no use whatever in providing for the things that man
wears and eats and requires for shelter. And so, Imposed
upon the complications of an already complicated world, we
have the necessity for contributing a larger share of our
total national production to something that is inherent waste
and whose best use would be to never use it at all.
As a part of the cold war we will be concerned not only
with our defense in a physical sense but with the competition
which will exist between the Western world and the Soviet bloc
countries in an economic sense. This subject is much too
broad to yield to a full discussion here. I should like to
point out two areas — one to their advantage and one to
our advantage — that should weigh In our thinking.

148
-7The Soviet Union as a monolithic state with the ownership of
all of the means of production concentrated in the central government, may be able to deal with other countries advantageously both
on a system of barter and in making ruble loans. For example, It
can afford to take foodstuffs of other countries in barter arrangements because of its need to supplement its own production of food
while in the United States we are confronted with problems of agricultural surplus. In making ruble loans to other countries, the
Soviets can appear to be generous because they realize that when
the ruble is spent for capital goods, it must in the first transaction be spent either in Russia or one of the Soviet bloc countries.
There is the barest kind of international trade in the ruble as such.
On the other hand, If the United States should make a dollar
loan to other countries, unless it is accompanied by conditions
requiring its expenditures in the United States, the dollars loaned
will be competed for by all of the other countries of the free
world which produce capital goods.
As a general proposition, therefore, in transactions as between governments and other countries the Soviets would have an
advantage. On the other hand, with no means of production owned
by the citizens of Russia, they would be hardpressed to go into
other countries and purchase capital equity even in participation
with the citizens of other countries. It is hardly conceivable
that either the neutral or free countries would tolerate substantial
investments of capital and equity ownership by the Soviet government
itself.
On the other hand, the private citizens of this and other
free countries wishing to invest their own capital find a warm
welcome in other countries as equity investors if they follow
the rules of good citizenship of the other nations. In this way,
great opportunities are opened to the individual citizens of the
less developed countries to play an important role in the betterment
of their countryfs economy and its people. On the basis, therefore,
of dealing between private individuals, the United States and other
free countries may have a net advantage over the Soviet.
If one believes, as I do, that real and lasting peace in our
world must have an economic as well as political foundation and
that this foundation must be planted most firmly in the consciousness
of men concerned with their own betterment and with rising standards
of living, we may very well have at our disposal — in these dealings
between private individuals — the best means of securing both
economic betterment and a just and lasting peace.

As the economic machinery of other countries around the
world is developed or goes through processes of evolution
and change, we must make it possible for them to adopt those
portions of the American and free world system of capital as
are consistent with their own traditions and their own
capabilities. We are leaders in a tremendous cause — the
struggle of men everywhere to live without crushing want and
to live in freedom. No tyranny in history has been able to
crush this hope in the hearts of men. But it is unrealistic
as well as dangerously shortsighted to assume that others
will want to take over our entire way of life just as it has
developed in this country, regardless of how well it may fit
their particular needs at this particular period of their
development. We must try to be advocates of our system, with
emphasis on the benefits which flow to people — recognizing
that the particular techniques which helped us achieve those
benefits may have to be modified for use elsewhere.
When we look at our country in perspective, we are
impressed with the fact that during the last seventy-five
years we have built the most productive system in the world.
When one analyzes why this is so, a great deal of attention
must be paid to the process of growth and change resulting
from the dynamic demand of people for more goods and for
better ways to produce them. These demands are expressed
in terms of research, technology, and incentives on the one
hand, and In higher standards of living on the other. In
the whole process of change and development, the constant
conflict between liberty and controls continues.
The forces which have been responsible for the evolution
and development of our economic system and its tremendous
productive power are as vital today as ever before and beckon
us to new horizons of accomplishment. There will always be
problems with which we have to cope. A competitive economy
with dependence upon myriad decisions and judgments will
always incur the hazards of recession and inflation. We
have learned a great deal about how to cope with them. We
must always be endeavoring to learn more. This requires
flexibility and a willingness to utilize our maximum
competence and instrumentalities both as a people and as
a Government to see that neither inflation or deflation
should run a ruinous course.

-9We will always have the problem of providing the incentives for
the formation of adequate capital and the education which will secure
an adequate supply of skilled people. We will always be concerned with
the complexities of cost and price and the consequent responsibilities
that are attendant upon labor and management in order that we maintain
a sound relationship in the public interest. We will eternally have with
us the problem of maintaining our freedoms and avoiding regimentation.
Our faith in this country and our economic system is strong. We
have become the greatest productive nation in the world. Our distributive capacity has run somewhat behind and we must be sure that our
ability to distribute both nationally and internationally matches stride
with our productive ability.
**

We doubled our national output once every twenty-four years before
World War II and once in eighteen years since that time. The benefits
of our growth are being shared on a widening basis. Individual and
family income is on the rise. More than one-third of the American
families earn in excess of $5,000 per year. And, the Committee for
Economic Development, in a recent report estimated that by 1975 the
average family income after payment of taxes will amount to $7100 a
year (in terms of dollars of 1956 purchasing power) and that by 1975
our gross national product may well exceed $725 billion.
Today there Is a new challenge and a new opportunity.
Our national population has doubled in 50 years. It is expanding
at a rate of 3 million persons per year. The number of American workers
is increasing at a rate of nearly 1 million per year. Millions of new
workers will be needed to make, sell, and distribute our goods.
Looking at even broader figures, it took the world something like
5,000 years of recorded history to have the first billion people alive
on this earth at one time. This occurred in 1830. It took us only a
little over 100 years to have the second billion people alive at one
time on this globe. By 1970 the world will have three billion inhabitants — and those three billion are the people whose wants and demands
will make the economy of our country and the economy of the world.
These factors of growth bring us to the realization of the new
demands that will be impressed upon our technology and our science;
new obligations for educational opportunities and a higher quality
of education. They emphasize the necessity for improving the
national health; for utilizing all our ingenuity as Individuals,
business and government to minimize fluctuations in our economy;
to provide, in addition to material things, new cultural
opportunities for people who have time to enjoy them.
The vistas of the future are as limitless as the capacity of our
0O0
people. It belongs to the dynamic,
to the Imaginative, to those who
are willing to work and compete.

151

A -) 1$

RELEASE A. K. HESJSPAPIRS,
Tuesday, April 29. 19g8«

The Treasury Department announced last evening that the tenders for H , 700,000,000
or thereabouts, of 91-day Treasury bills to be dated May 1 and to mature July 31, 1958,
which were offered on April 2k9 were opened at the Federal leserve lank* on April 28.
The details of this immm are as follows?
Total applied for - 12,801,565,000
Total accepted
- 1,701,815,000 (include® $29®90$k9QOO entered on a
HonoonpetitiT® be*it and aeeepted in
full at the average price shown below)
Mange ©f accepted competitive bids* (Excepting two tenders totaling #1*00,000)

l^fW

• 99.671 Equivalent rate ©f discount approx. 1.302^ per annua
- 99.652
*
• »
•
«
1.377$ «
*

Average

- 99*655

High

1*361%

(51 percent of the amount bid for at the low price was accepted)
Federal teeerve
District

total
Applied for

Total
Accepted

Boston
Ifew York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

1
31*822,000
i,99S,t*r?*000
39,1§§,0O0
56,21*3,000
22,167,000
37,636,000
313,772,000
30,971,000
20,156,000
56,738,000
21,7Oli,0O0
175,7ia,O0O

I
31,372,000
1,112,070,000
19,876,000
1*1,11*3,000
20,862,000
33,309,000
21*5,970,000
2l*,336,O00
18,362,000
15,303,000
21,701^,000
87,508,000

#2,801,565,000

^.,701,815,000

TOTAL

TREASURY DEPARTMENT
WASHINGTON, D.C
[ELEASE A. M. NEWSPAPERS, A opg
Tuesday, April 29, 1958.

*-**v

The Treasury Department announced last evening that the tenders for $1,700,000,000
>r thereabouts, of 91-day Treasury bills to be dated May 1 and to mature July 31, 1958,
rhich were offered on April 21*, were opened at the Federal Reserve Banks on April 28.
The details of this issue are as follows?
Total applied for - 12,801,565,000
Total accepted
- 1,701,815,000 (includes $29Q,051*,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Range of accepted competitive bidst (Excepting two tenders totaling f!*00,000)
High - 99*671 Equivalent rate of discount approx. 1*302$ per annum
Low
- 99.652
»
» it
»
n

1.377$ "

Average »,99.655 n M w " w 1.367$ w w
(51 percent of the amount bid for at the low price was accepted)
Federal Reserve
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

TOTAL

Total
Applied for

Total
Accepted

% 31,822,000
1,995,1*27,000
39,188,000
56,21*3,000
22,167,000
37,636,000
313,772,000
30,971,000
20,156,000
56,738,000
21,70i*,000
175,71*1,000

$ 31,372,000
1,112,070,000
19,876,000
1*1,11*3,000
20,862,000
33,309,000
21*5,970,000
2l*,336,000
18,362,000
1*5,303,000
21,70l*,O00
87,508,000

$2,801,565,000

$1,701,815,000

- 3-

or by any local taxing authority. For purposes of taxation the amount of disco

at which Treasury bills are originally sold by the United States is considered
be interest. Under Sections h$k (b) and 1221 (5) of the Internal Revenue Code
195U the amount of discount at which bills issued hereunder are sold is not

considered to accrue until such bills are sold, redeemed or otherwise disposed

and such bills are excluded from consideration as capital assets. Accordingly,

the owner of Treasury bills (other than life insurance companies) issued hereu

need include in his income tax return only the difference between the price pa
for such bills, whether on original issue or on subsequent purchase, and the

amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 1*18, Revised, and this notice, prescribe

the terms of the Treasury bills and govern the conditions of their issue. Copi
of the circular may be obtained from any Federal Reserve Bank or Branch,

- 2 -

2 percent of the face amount of Treasury bills applied for, unless the tenders
accompanied by an express guaranty of payment by an incorporated bank or trust
company.
Immediately after the closing hour, tenders will be opened at the Federal Re-

serve Banks and Branches, following which public announcement will be made by t
Treasury Department of the amount and price range of accepted bids. Those submitting tenders will be advised of the acceptance or rejection thereof. The
Secretary of the Treasury expressly reserves the right to accept or reject any
all tenders, in whole or in part, and his action in any such respect shall be

final. Subject to these reservations, noncompetitive tenders for $200,000 or le

without stated price from any one bidder will be accepted in full at the averag

price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Re
serve Bank on May 8, 1958 , in cash or other immediately available funds

or in a like face amount of Treasury bills maturing
May 8. 1958
• Cash
and exchange tenders will receive equal treatment. Cash adjustments will be mad

for differences between the par value of maturing bills accepted in exchange an
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

sale or other disposition of the bills, does not have any exemption, as such, a
loss from the sale or other disposition of Treasury bills does not have any

special treatment, as such, under the Internal Revenue Code of 1951*. The bills

are subject to estate, inheritance, gift or other excise taxes, whether Federal

or State, but are exempt from all taxation now or hereafter imposed on the prin

or interest thereof by any State, or any of the possessions of the United State

KXKXKOKX
TREASURY DEPARTMENT
Washington

Jf _

'1 ^

/r
^'

A. A.
RSR RELEASE/ KBKKXBS NEWSPAPERS,
Thursday, May 1, 1958
_.

w—*
The Treasury Department, by this public notice, invites tenders for
$ 1,700,000,000 , or thereabouts, of 91 -day Treasury bills, for cash and
in exchange for Treasury bills maturing May 8, 1958 , in the amount of
$ 1,699,718,000 , to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. The bills of this series will be
dated May 8, 1958 , and will mature August 7, 1958 , when the face

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
closing hour,/&bHXo*clock p.m., Eastern/xhn»mUwfc time, Monday, May 5, 1958

95
Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1,000, and in the case of competitive tenders

the price offered must be expressed on the basis of 100, with not more than thr
decimals, e. g., 99.92$. Fractions may not be used. It is urged that tenders
be made on the printed forms and forwarded in the special envelopes which will
supplied by Federal Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit tenders
except for their own account. Tenders will be received without deposit from

incorporated banks and trust companies and from responsible and recognized dea

in investment securities. Tenders from others must be accompanied by payment of

TREASURY DEPARTMENT
WASHINGTON, D.C.
RELEASE A.M. NEWSPAPERS,
Thursday, May 1, 1958.

A-229

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing May 8, 1958,
in the amount of $1,699,718,000 to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated May 8, 1958,
and will mature August 7, 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5>000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o*clock p.m., Eastern Daylight
Saving time, Monday, May 5, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price' offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or In part, and his action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
$200,000 or less without stated price from any one bidder will be
accepted In full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders in accordance
with the bids must be made or completed at the Federal Reserve Bank
on May 8, 1958,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing May 8, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The Income derived from Treasury bills, whether Interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject
to estate, Inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder need Include in his income tax return only the
difference between the price paid for such bills, whether on
original Issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury*Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

0O0

Acting under advices of the State Department, the Treasury
Department announced today that it Has revoked the Egyptian Assets
Control Regal at ions, which had placed under licensing procedure
certain assets la this country of the Sues Canal Company and the
Sgyptian Government, the Regal at ions were issued pending clarification of the situation with regard to these assets, which has
now been brought shout by the agreement recently concluded
between the Government of the united Arab Republic and the Canal
Ceoapsny. xne revocation MXXXxfcg e r ike r C*A ul a I it>as wi 11
be effective May. 1, 1958.

SArnoldiVJt
4-29-58

TREASURY DEPARTMENT
WASHINGTON, D.C.

IMMEDIATE RELEASE,
Wednesday, April 30* 1958.

A-230

Acting under advices of the State
Department, the Treasury Department announced
today that it has revoked the Egyptian Assets
Control Regulations, which had placed under
licensing procedure certain assets in this
country of the Sues Canal Company and the
Egyptian Government, The Regulations were
issued pending clarification of the situation
with regard to these assets, which has now
been brought about by the agreement recently
concluded betiveen the Government of the
United Arab Republic and the Canal Company.
The revocation will be effective May 1, 1958.

oOo

FOR IMMEDIATE RELEASE:

1 59

^ 1»

STATEMENT BY THE TREASURY DEPARTMENT
Refunds to taxpayers who have over-paid on their 1957 income
taxes totaled $2,452,000,000 from January 1 to April 24, this
year, an increase of 35 percent over the dollar amount of tax
refunds made in the same period in 1957.
Nearly 4| mil3Jon more refund checks — an increase of 2k% —
have been mailed than during the same period last year.
Secretary Anderson said:
"The Internal Revenue Service, in particular, and the Bureau
of Accounts are to be congratulated for their fine performance in
this speeding up of the handling of refund cheeks."
The Internal Revenue Service has been making extraordinary
efforts this year to speed up refunds by temporarily reassigning
personnel and taking other steps in nearly all offices throughout
the nation to help the refund processing get done as promptly as
possible.

The Bureau of Accounts also aided by employing some

temporary: help.
If the current rate continues all refund checks, which are
based on vouchers sent by the Internal Revenue Service to the
Bureau of Accounts, may be issued by mid-May.
Reports from the Internal Revenue Service and Bureau of
Accounts show that the $2,452,000,000 refunds issued through
April 24 of this year compares with a total of $1,820,000,000
issued during the same period a year ago.

Actual number of refund

checks issued by the Bureau of Accounts up to April 24 were
22,697,695 compared to 18,258,091 last year.
A-231
oOo

TREASURY DEPARTMENT
WASHINGTON. D . C
FOR IMMEDIATE RELEASE:

May 1, 1958

STATEMENT BY THE TREASURY DEPARTMENT
Refunds to taxpayers who have over-paid on their 1957 income
taxes totaled $2,452,000,000 from January 1 to April 24, this
year, an increase of 35 percent over the dollar amount of tax
refunds made in the same period in 1957.
Nearly 4i million more refund checks — an increase of 24$ —
have been mailed than during the same period last year.
Secretary Anderson said:
"The Internal Revenue Service, In particular, and the Bureau
of Accounts are to be congratulated for their fine performance in
this speeding up of the handling of refund checks."
The Internal Revenue Service has been making extraordinary
efforts this year to speed up refunds by temporarily reassigning
personnel and taking other steps In nearly all offices throughout
the nation to help the refund processing get done as promptly as
possible.

The Bureau of Accounts also aided by employing some

temporary help.
If the current rate continues all refund checks, which are
based on vouchers sent by the Internal Revenue Service to the
Bureau of Accounts, may be issued by mid-May.
Reports from the Internal Revenue Service and Bureau of
Accounts show that the $2,452,000,000 refunds issued through
April 24 of this year compares with a total of $1,820,000,000
Issued during the same period a year ago,

Actual number of refund

checks issued by the Bureau of Accounts up to April 24 were
22,697,695 compared to 18,258,091 last year.

i6i

RELEASE A . M . UMSPAPERS,
/ \
•Tuesday, May 6, 1958.
•
The Treasury Department announced last evening that the tenders for $1,700,000,000
or thereabouts, of 91-day Treasury bills to be dated May 8 and to mature August 7, 1958
which were offered on Hay 1, were opened at the Federal Reserve Banks on May $.
The details of this issue are as follows:
Total apolied for - f-2,653,445,000
Total accepted
- 1,700,504,000 (includes $290,854,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Range of accepted competitive bids: (Excepting one tender of $100,000)
High - 99.703 Equivalent rate of discount approx. 1.175$ per annua
Low
- 99.699
'
H
w
*»
«

1.191£ «

Average - 99.700 " « « « v l.lg?* * »
(93 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
Mew York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

1
45,369,000
1,733,299,000
43,273,000
63,780,000
16,319,000
42,557,000
333,520,000
39,635,000
36,010,000
62,334,000
52,544,000
184*805.000

^2,653,1*45,000

$1,700,504,000

TOTAL

42,711,000
1,007,526,000
23,690,000
52,569,000
13,051,000
33,183,000
269,914,000
23,499,000
35,510,000
36,724,000
19,439,000
142,688.000

•

TREASURY DEPARTMENT

162

WASHINGTON, D.C
RELEASER. M. NEWSPAPERS,
Tiieaday, May 6, 1958.

A-232

The Treasury Department announced last evening that the tenders for $1,700,000,000,
or thereabouts, *of 91-day Treasury bills to be dated May 8 and to mature August 79 1958,
uhich were offered on May 1, were opened at the Federal Reserve Banks on May $.
The details of this issue are as followsj
•Total applied for - $2,653,445,000
Total accepted
- 1,700,504,000 (includes $290,854,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Range of accepted competitive bids: (Excepting one tender of $100,000)
High
Low

- 99.703 Equivalent rate of discount approx. X.X7$% per annum
w
- 99.699
w
n
*
w
l.l9ijg *
»

Average

- 99.700

X.X&1%

(93 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

$
45,369,000
1,733,299,000
43,273,000
63,780,000
16,319,000
42,557,000
333,520,000
39,635,000
36,010,000
62,334,000
52,544,000
184,805,000

$
42,711,000
1,007,526,000
23,690,000
52,569,000
13,051,000
33,183,000
269,914,000
23,499,000
35,510,000
36,724,000
19,439,000
142,688,000

$2,653,445,000

$1,700,504,000

TOTAL

- 31 P 3
M M
or by any local taxing authority. For purposes of taxation the amount of discount
at which Treasury bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal Revenue Code of
195U the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed of,
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 4l8, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch.

- 2-

remx

serve Banks and Branches, following which public announcement will be made by th
Treasury Department of the amount and price range of accepted bids. Those submitting tenders will be advised of the acceptance or rejection thereof. The

Secretary of the Treasury expressly reserves the right to accept or reject any o
all tenders, in whole or in part, and his action in any such respect shall be

final. Subject to these reservations, noncompetitive tenders for $200,000 or les

without stated price from any one bidder will be accepted in full at the average
price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on May 15, 1958 , in cash or other immediately available funds
or in a like face amount of Treasury bills maturing May 15, 1958 . Cash

and exchange tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in exchange and
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

sale or other disposition of the bills, does not have any exemption, as such, an
loss from the sale or other disposition of Treasury bills does not have any
special treatment, as such, under the Internal Revenue Code of 1954. The bills
are subject to estate, inheritance, gift or other excise taxes, whether Federal

or State, but are exempt from all taxation now or hereafter imposed on the princ

or interest thereof by any State, or any of the possessions of the United States

TREASURY DEPARTMENT
Washington
A. M.
B8K RELEASE^ BBKSXHS NEWSPAPERS,
Thursday, May 8, 1958
.

y
T

~ %.

The Treasury Department, by this public notice, invites tenders for
$1,700,000,000

, or thereabouts, of

-day Treasury bills, for cash and

. ^o

in exchange for Treasury bills maturing
May 15, 1958
, in the amount of
$1,709,489,000 , to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided.
dated

May 15, 1958

, and will mature

The bills of this series will be
August 14, 1958

, when the face

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
^o
closing hour, tant/o'clock p.m., Eastern gfrSKMsya time, Monday, May 12, 1958

SB
Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1,000, and in the case of competitive tenders
the price offered must be expressed on the basis of 100, with not more than three
decimals, e. g., 99*92$. Fractions may not be used.

It is urged that tenders

be made on the printed forms and forwarded in the special envelopes which will be
supplied by Federal Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit tenders
except for their own account. Tenders will be received without deposit from
incorporated banks and trust companies and from responsible and recognized dealers
in investment securities. Tenders from others must be accompanied by payment of

RELEASE A.M. NEWSPAPERS,
Thursday, May 8, 1958.

A-233

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing May 15, 1958,
in the amount of $1,709,489,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated May 15, 1958,
and will mature August 14,1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, May 12, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price' offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It Is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or in part, and hi3 action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
$200,000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders in accordance
with the bids must be made or completed at the Federal Reserve Bank
on May 15, 1958,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing May 15, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether Interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
Issued hereunder need Include In his Income tax return only the
difference between the price paid for such bills, whether on
original issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their Issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

oOo

S T A T U T O R Y D E B T LIMITATION

It)i

AS 0F.Jteti3L.29*J«58
ion 21 of Second Liberty Bond Act, as amended, provides that the face amount of obligations issued under authority
Section
of that Act, and the face amount of obligations guaranteed as to principal and interest by the United States (ewett «ucBgu«|.
anteed obligations as may be held by the Secretary of the Treasury), "shall not exceed m the aggregate f 275,UOO,OOU,UOU
(Act of June 26, 1946; U.S.C., title 31, sec. 757b), outstanding at any one time. For purposes of this section the current redemption value of any obligation issued on a discount basis which is redeemable prior to maturity at the option of the holder
shaft be considered as its lace amount." The Act of February 26, 1958, (P.L. 85-336 85th Congress) provides that during the
period beginning on February 26, 1958 and ending June 30, 1959, the above limitation ($275,000,000,000) shall be temporarily
increased by $5,000,000,000.
The following table shows the face amount of obligations outstanding and the face amount which can still be issued under
this limitation:
Total face amount that may be outstanding at any one time
$>2oO,OO0,00Q,000
OutstandingObligations issued under Second Liberty Bond Act, as amended
Interest-bearing:
Treasury bills
Certificates of indebtedness
Treasury notes
BondsTreasury
* Savings (current redemp. value)
Depositary.....
Investment series
Special FundsCertificates of indebtedness
Treasury notes
Treasury bonds
Total interest-bearing
Matured, interest-ceased
»
Bearing no interest:
United States Savings Stamps
Excess profits tax refund bonds ....
Special notes of the United States:
Internat'l Monetary Fund series
Total

$22, 4 l 4 , 5 6 3 , 0 0 0
31,121,687*000
24,732,109,000
87,655,360,750
52,164,371,475
156,344,000
9,710,128,000
29,339,549,000
12,640,584,000
3,462,500,000

5d,293,391
893,624
665,000,000

Guaranteed obligations (not held by Treasury):
Interest-bearing:
Debentures: F.H.A
93,220,650
Matured, interest-ceased
658,950
Grand total outstanding ,.
Balance face amount of obligations issuable under above authority,
» • -i
uc
t.u D M - r, u
Reconcilement with Statement of the Public Debt

73,268,359,000

l49,686,204,22$

45,442,633,000
273,397,196,225
5-LO, 7 0 6 , 1 6 4

716,187,015
274,624,089,404

93,879,600

274,717,969,001*
5,282,030,9^

April 3 0 , 1958
.f.
7.......

...„

(Date)

(Daily Statement of the United States Treasury,.,. . A p r i l 30., 1 2 5 ^
_

(Da't'e)

OutstandingTotal gross public debt
„.,.
„
Guaranteed obligations not o w n e d by the Treasury,
Total gross public debt and guaranteed obligations.
,
,
„„.,
D e d u c t - other outstanding public debt obligations not subject to Bebt limitation.,,

)

275,057,407,508
93,879,600
21$,l$l,m,W
433,3l8,lQj*

2lk,U1,WM
A-234

S T A T U T O R Y D E B T LIMITATION

I C Q
JL yy ^

Washington SOli J2S&
Section 21 of Second Liberty Bond Act, as amended, provides that the face amount of obligations Issued under authority
f that Act, and the face amount of obligations guaranteed as to principal and interest by the United States (except »uchguat»
iteed obligations as may be held by the Secretary of the Treasury), "shall not exceed in the aggregate $275,000,000,000
Ut of June 26, 1946; U.S.C., title 31, sec. 757b), outstanding at any one time. For purposes of this section the current re•mption value of any obligation issued on a discount basis wnich is redeemable prior to maturity at the option of the holder
ball be considered as its face amount." The Act of February 26, 1958, (P.L. 85-336 85th Congress) provides that during the
•riod beginning on February 26, 1958 and ending June 30, 1959, the above limitation ($275,000,000,000) shall be temporarily
icreased by $5,000,000,000.
The following table shows the face amount of obligations outstanding and the face amount which can still be issued under
lis limitation:
otal face amount that may be outstanding at any one time
$280,000,000,000
OutstandingObligations issued under Second Liberty Bond Act, as amended
Interest-bearing;
Treasury bills
Certificates of indebtedness
Treasury notes
BondsTreasury
* Savings (current redemp. value)
Depositary.....
Investment series
Special FundsCertificates of indebtedness
Treasury notes
Treasury bonds
Total interest-bearing
„
Matured, interest-ceased
»
Bearing no interest:
United States Savings Stamps
Excess profits tax refund bonds ....
Special notes of the United States:
Internat'l Monetary Fund series ,
Total

$22,4l4,563,000
31,121,687,000
24,732,109,000
87,655, 360, 750
52,164,371,475
156,344,000
9,710,128,000
29,339,549,000
12,640,584,000
3,462,500,000

73,268,359,000

l49,686,204,225

45,442,633,000
273,397,196,225
5l0, 706,164

50,293,391
893,624
665,000,000

716,187,015
274,624,089,404

Guaranteed obligations (not held by Treasury):
Interest-bearing:
Debentures: F.H.A
93,220,650
Matured, interest-ceased
_____
658,950
Grand total outstanding ._
balance face amount of obligations issuable under above authority,
Reconcilement with Statement of the Public Debt,
(Daily Statement of the United States Treasury,

274,717,969,004
5,282,030,996

April 30, 1958
(Date")
Aj>jJ^ 3.Q*...1!?.58
(Date)

({standingTotal gross public debt
.
Guaranteed obligations not owned by the Treasury,
,
Total gross public debt and guaranteed obligations.
duct - other outstanding public debt obligations not subject to (lebt limitation

A-234

93,879,600

„
.„,.

275,057,407,508
93,379,600
S75,151,28f^IoH
433,318,104
274,717,969,004

W 1 Mm

MMq&lateft ftotUm # U t to£aj, I Imp* I

fern mmmwrni the ii#& that ths problems we f M ® mm not
#&ij @f solution, I m m prmaise y w ^ « t thm Adndnistratloa
will tosfcla* to face up to thssa In tbe lm*g-raiige test
In Uresis if tb# people of Mepiefe.

- 900 -

• 19 •

17M
I i v

Tka fNistlw It not a at* mm*

I aaSarataal that, AUP»

iag anwjrfetiiaaaaiaallaa St tha fmimw

pari at, similar

qpaatloaa haaa taaa pit to tha Trtaattrr*
If oat concentrate oa ottrraat haalaaaa laaataa aa!
traala, it la oftaa aaar* *£ aaaraa, to toaqmartty l^ia
si#ht or tha loaf-taw aaatalai*g foraaa that teta mm&m mr
ornate ttaat* lauklug * w y M # among thaaa foraaa la tha
hafcit of thrift, mfoa fsMah iap^to tha aoaal f laaaaU* of
aar flktloa'a lalaatrlal » i # t aa mil as praaiftfag a P o k ing of aavfcqpi fa* aHlloaa of oar faofla^
Tkm hahtt of thrift la not something to fca nnoonragai
at mm tSaa aai aiaaoaaqgai at aaothar. It is much too
kaaio. la a aattar of f aat, tha praaaat aaoaoaio tawrtam
la tka aftaeaatk of an laflatiatti? haosi wltioh aouU kaaa
haaa much a&liar hal Aaarlaaaa aaaai aora thaa thay ill
luring vaaaot fmm-

mm® m aaaaanga tha .habit of thrift*

aa ara atra^fthaaiaf fka f cwriatloaa of prlaata atrtarpriaa
*M lafaataqr * i a h haaa mim oar aooooap tha aaat ftatoatlaa
la tha aorli*
I a® sura jroa will aoathna to flirt yoar aappart to tka
GownaMfft'a pragfaa of akarlag la taarlaa tkta^k tka
prahaaa of ihltai Stataa Saviaga Boaaa.

7 1

* 18 •
Tha Sailva Band fropwft O T O M not hum adblataa Ita
graat auaaaaa without tha aappart of tha m a t najorlty af
tha haaklv laatitatloaa of thia aaarikf?* Tha Payroll
SaYlaga pin* ahldh la tl* witaatay of tka Stvhg* Boaa
program as It aalata to«ayf ftoas a Job that tha savings
laatltatlaaa aaaaat la aa affaattaaly* V«fjr far anployara
m a t to pit oa aa aatlaa aalaa aaapalga la thair raapaatlaa
ttqpalaatloaa to sail aaftapi aaaanta for a ^ aiagla
prlaata lattltatlaa* H&ay a n %® m la goai aoaaalaaaa with
TJhltaa Stataa Saritaga Boala, Utatally •llllna of
laarlaaaa h a m aaaaaalataa thair flrat aaaUg* throng
payroll aaaaatloaat aaitettaffn n aopdrai tilt hahlt of
thrifty thay haaaao tha aaataaava of othar typaa of aavtaga
laatitatloat aho offar a »or# aarlaB aaniaa* fhaaa savara
accumulate nest aggs that have ponittaa aoaapayaaafta m
ootmtlaaa hoaaa ahlak yoa haaa iiwmmmM aa& oa all aorta
of Isarahlt gaata nisiah oouM sot otharalaa hata h a n
aavdra8«
Hoa aoaa paofla a»y aak yoa* as thay hawa aakai aa —
•Wflr It tha (knwaaaat proaotlag Sarlata Boa9 salas at thia
partiaitlar tla*? In rlaw of tha aorraat haaiitaaa iaoliaa,
aaaMa't It parhapa ha hattar to aaaoaraga oar oitiaaaa to
*V

thln s

^ ***k« than al&iag to thair finaaalal raaaraaaf •

• 0^7^

- 1? dasaand insofar aa that aaa ha dona consistent with tha other
ohjaati*aa whieh m hava to kaap la aiai. fo aia m in
thia* wa liataa iateatly to aiggaatioaa aso i&mmm fro* grmf*
anah aa yosra« % hopa that a n y <* J»» —

iaaiwMaaUy, aa

a l l aa through yomr Cosalttaa oa Soaanaaat Saaaritiaa as£
tha Pahlia Daht -~ will omm ia aai talk oTar with m

thoughts yoti «ay hata which aight half us to do our joh
hattar.
Is
And finally I woall lika to mmg a ward ahost TMtai
States Savings Boala*
la our jsdgiseat, tha Savii^a Bona progrn has hmmm of
laaatlaaUa haip aot only to tha Govataaaat tmA tha 40 allUai
people who hold tha horia but also to tha ahala thrift and
aaaiaga lalaataqr« fo mmm tf yo® tha Sawiaga Boat p r o g m
say appaar to b« only another for© of competition aa§ ,
parhapa, aaaarrastal aoafatltioa*

Ia ay jaifaeat — aai I

hava been a banker all ay business U f a — tela has alaaya
aaaaaa to mm a shortsighted point of viaw.
I am aot to aalwa aa to believe that, if soaaoaa walks
lata 03a of your institutions to aaka a iapoait* yoa ara
going to suggest that tha paraoa hny a Sawiaga Bona instead,
Oa tha othar haad, I aoa*t think it's good public relation
to £o tha ravaraa*

ft ahaakl alao hm mmmUt^-9
apart frsa tha aala of Im^mm
a * U n aonMaaakla mmm-m

®t aoaraa, that, ^ita
koala* tha ffaaaaqr a n

ia iakt laagthnteg W

mlllm

iataraaaiata~tai'a aaaarltlm to anaaratal hanka ia a parl«a
mmk aa thia* For asaapla* tha Tranatf %m&* mora p r a g m a
ia laht laagthnliig luring IWm f h n la mtw o%\m aalaalar
yaar since loria iar II, yat m laanaa vaniag mora t h n W
years ta mturity wara pat oat luring that yaar.
% f n tka aaat taportaat part of Traaata^r a m wmm$
Inamrfag aariag * laaNaniaaaay parioi U mmfy

^om

through tha anaarilal hnfca* aal m tmm m m a n to
hallow that m%* asfartaaaa la thia raaaari.n will ha n y
ttffataat, la I tew a«waat*l# hoaatar* ia tha paaaan ®f
anaaatoatlag n bai* tawinbig* wa shottM «@t tmnaiiataiy
aaana tbat it a l U all ka ahart~tam harrowing or that
aoaaiiaratioii af noabatsk mmvm*

of fnaSa ehoaM hm

aaglaatal aatiraly*
Thaaa mm

*f th a thoaghta afcHk I want to lea^a

with jm ta tha hopa thay will atlnlata y n la glwiag m
tha kaaaflt of yoar own thlridag oa than iaportaat aattaf*«
Tha A a « u r » as you ara wall amra, a a n aat work la n
i*ary toaar. It Is w

joh to pai»ta*Aagly flift oat liiat

thaaafffeat anta aail attan* to talln laaon to w**M that

174
•* IS *
*M anlalpal nlaater# n i tha apaatal aaaaa of mrioaa
trpaa af iaantamt m& t h n atHa tha ilfftaalt iaaiaioa
aa to what m m

«f aattn mm jalga will n k a tha graataat

anfcrfhatln to tha iahli© iaftaaaat — mot oaly la tha
waaka ianiiataly ahaai hit w

tha laagar rmg*.

$mm imU aatanln a n f af w a r m * ha aaanfll*rf
uniiraly ?utai«a tha a m af aoapatitioii far- a n thai a hy
waking it attnattwa for iaantora aaah M ntaal aa^^fa
hanks, lnwraan *c»Bpnim» p a n i nfttait,#ta*» to laagtlm
thair mm partfalloa ky i*q>lnlag ana of thair atart- « ^
lit amaiata«tana with loagar~ta*aa» Tha ahart- or
latarnilata-»tan aaaaritlaa ffritfc than nrlaga typa of
laatltatlan n i l n«ia 9 for tha nat part* ha nfairaa ly
tha aonanial haaka* Tha a m a g a t a n to maturity of
Ganiaaaat aanaitin kaM hy aateal aa^iaga haafe§f f n
anafla* ia about § yana to f Irat a a U lata, aa against
a h m t 14 yaan la lf«* fhara way ha a o n aarit la
aaaanaglag *•** la^gthaarbg witkla partfalln wfm at
tina whaa tka n t a n t rf mm mmxmf aniktUa far lavaat*
n a t ia Fa&anl aaaurltin ia anil* without running tha
rlak af napatUg anaaaaaarll? far fnaia tmm&mM to nppari
rmmei

axpnain*

Furtharmars, it nomll n t ha la thm Traaattiy'a* and
h a a n tha t®atpayerfaf iataraat to pat oat an inordinate
amount of long-term Aaht at tha relatively high interest
m t a a that pnwall ia a prloa of f i n araiit restraint*
Cnai&aratioaa of thia sort womli mmm to indicate that
— aoatrary to classical theory — tha fraaatary ah^sM aot
rttla out consideration if tha aala of lang-Urm securities
a b n monetary pollap la QW* of credit ease, fat wa wmt aot
ha aaadaafatl ^f what that aomraa iarolrea* l^riag period*
a i m the Fedaral Eeaarve ia easing credit to stiaulate business activity, tha Treasury must walgk its debt i s a ^ n t
objectives ia tha U«ht of hath thm ahart- and laog-nm
nelfara of tha eecmssry n i the inirahiiity of beiag af
assistance by not abaorbiag funds which nsight hattar serta
tha aaoao^f if used far prlmta parpaan*
faring tha iaal m p n a i h i l l t y of haarlag ia mind tha
goa! of a hattar mturity attribution of tha iaht and
equally eoasiieriag tha walfara of tha eaoaoay, wa ia Treasury doubt the wisdom of strict adherence to precise £ omnia s
to g^lia our aetiaas* fa wiah daht aaaagaaaai mm
simple-

that

It a#@n to us that, la a&ah instance, wa a n t try

to weigh all tha £a*tan t mmh as tha technical position af
the nxtett tha amilahlllty af araiit to tha corporate,
aaalalpal9 ami mortgage aarketa* tha impending corporate

- 13 atieh f^aads ara mmnBmmi

1 7C

excessive. Likewise, tha theory

holda thai tha Traasmy should c tsaentrate oa sell lag shortt a n s#ata*itln a h n fee *metary paliey ia one of ease,
thus strengthening the factor* ia the anaoay mkiog for
gmmtmw Ufalllty eat readier aval lability and use f credit.
But ia actual feet, t> ere ara seri^ua difficulties ia
tha m y of ratting these f i n priniplaa iato effect. T
mm

that y o n o n investment experience will eoafira tha

fact that debt m a a g a m t in mm d* tha meny araaa w h e n
classical eaoania theory can be a aonafcat unreliable p U «
to rami life aa we fial it. tie sast eell oar securities to
specific bttyers ia a raal asrket, aot la a hypothetical
nrlat mhimM ia perfeatly fluid an3 perfectly r m p a n i n to
enirahle ehmngmm la policy, n the Trnsaiy trin ta fern
loag-tera securities oa investors aarlag a Period when
lataraat rat a are high and funds ara belag aagarly aoaght
for prlaate wrpommm* tha raaatt'-'ag aarkat ileordar wight
actually interfere w i & the effectiveness of Federal laserve
policy rathar t k n aoatrifcata ta it. If the mrkst
threatened to t m o n ao diaarlarly that the Federal "serve
had to stop la to any algaiflant extent, thia alfht t^«ira
the Feaaral tasarra ta haak mp teswrarily oa peliaiea
ahlah wmm leant nsaatlel to the good health of tha ecoaoay
at that tiae*

. !2pasaage of t i n .

177

Ia tha last f i n yearaf tha Treasury tea

managed to I m p tha laagth of tha marketable debt at about
five ysaraf average iaratiofu
effort,

This has takea namittlag

a hare iaanad $6 hillloa of 20-ynr aai o v w koala

m& IBS hillioa of S* ta 20~yaar hm&m to 4o thia* Biff iattlt
as it m y be at times ta pursue our goal of debt-lengthening,
we can never lose sight of OUT objective. Ia addition ta
all tha other considerations of nontary policy mi

prudent

a n a g s n a t af the public's funds, mm must lean sufficient
laeway la the short-tena area at all tiaes ao that a sizable
mlmm

of ahcrt*ta» loans mwM

ha successfully placed

should special circumstances require it. It mmli h* unwise
ia tha extreme to fully employ this a ource of funds under
lass urgent conditions.
For all of t h a n reasons, therefore, improvement ia the
debt structure through lengthening debt nturities whan
possible ia aa important goal of Traasasy debt management.
But when mm such actions possible and desirable0 A l a ia
the wfo of tha question.
-\ l n t according ta classical theory, the Treasury should
go at tha problem by selling long-tera securities when
monetary policy ia restrictive, thereby helping to withdrew
funds from tha private capital markets when demands for

nfoiranota. Tha Tawnaif eoapatn m%m mmmj la ti#**
It aoapatn afcn moaay is any*

% a gaaatln iaa't afcatkar i

ao«fata or aotf it ia, nthar* *** f « « « * aoapatiag takn
With reapawt ta tha anfear of tiaaa tha Xnaaaqr •"*
aatar tha nUcwt 4arUg a giram pariod, tha Faaanl Raaarn
mi tha fraasaay hath raaapdn that a n j n Treasury offerlag is n tapxrtaat aant in tha fismlaJL wnlif;tha s^rlat
n a t pr«pan f n It ahead «f t l n f aril it m a t h a n a aaff 1*
aiaat pnlol aftwnnaa far thorough ahniftin of tha a m
lean. Thia aaananlly Iftalta tha farioi iitritg afeiah tha
federal Wmmwm

mm mm a a n l n f faliay with g*NintA!...

affaatianna*

ft is a n aim to wtrk tawni atittlag tha

aaahn'af trips ta tha aaifeat* la kalian tha haat aoatha
far w

fatan aatarltln» aaaapt for aaasnaal bofraaiaK*

ara probably February, A y , lagnt, mi ffovaafear. »at#var
our lataatlan* it will hm n a y y«ara kaf ara the Traaamy
can hope to attaia than goals.
lhll* a distance to a^aataiy policy la a m j a r
responsibility af a bt naaganat* lengthening the debt
la also an laptitnt long-run polity goal f n tha staai*
poittt af tha Treaani^ alone. Firat ef alj* it ia necessary
to work continually at lengthening tha- debt in order to
y

feeap tha total fr<a shortening aa a rastilt af tha mere

• 10*

179

la haaKUag aabt aaaagaaaafc* aa§ aa allaaaan f n aaafcla*
gantita ahldk aAgjkt w i n *

lay mm n v l n nnat iaaarporata

tha tan aontlantian aa well aa tha pnapaat af inaraaaea
lafiaita*
la will antlnt § w afforts la tha fmmmmf to iaprova
mm a t m t a n of tha pblia labt« It ia n tapariaat goal
aal m UUmm

that It la aa naaatlai ad Junet to noaatary

polity m n i l aa being aaaal final polity ia itself..
Qooi iaht management n s t contribute to the financial soundness af tha aaanar* •**

^ mamas that it tank aaiaavar

to correlate w i & monetary policy to the greatest extent
praatia&bla* rather than setting up cross currents ^ihich
mmU

mm anftniy ta ^paapplata aation ia that flaia*
laht n n g t n a t mm warn this parpoaa best ia two

mays ** flnt* tjr fw&mim %km valne of raffling operation*
and, aaaatf* hy reinaiag the aaabm of times ahieh the
Tfeaaaaap ant go to the nrkat, Traaaaty fiaaitaiai opa»~
v?

tlan* aa yaa kan # n t mtf anpatw for fw^tt* with
corporate and mmicipal fiaaniag» bat thay reduce the
prioi of tin tmriag rtlab tha Felanl K a a a m baa relative
freedom to op«nta» Wkm a single borrower accounts for
aaa*thlra af tea aatin iaht af tha aontif — aa tha
fedaral O w a m n r t imm tolay — it ia aa obtlna faat that
such a borrower m a t aoapeta If ha la to mm$ hla borrowing

airanaiaiioas, n woaia b® hmmk la a lafiait a l t n t l n
aiailar to tha o n whiah hal b a n aofreatad earlier.
fha lanllag ia h a a i n n h n aaaarvaa. lal it h n haaa
anaapaalaa by a maw aamlapanfc* tha immmmmmi thraat to
o*ir aeaarity nlaal by lariat mtaaftlf la a i v a n n — with
thair mm military potentials. These maw factors la tha
iataantlaaal allatitm* p i n the apna««y af aeaial ionaiie
prog«$n t are a&peatai to nrry federal ionwnafc a*paall<»
tures back to at le&at tfB billion ia thm mxt fiscal year#
with a mtbatamtialljr larger iaf lait t h m the prospective
$1 billlm iafisit for flam! 1SB8*
Oar setting ia tha aaaagaamt of tha public debt, therefore, is afea^lag abruptly. Budget s^rrluses w*M* it
poaalbla ta reduce the labt fton tltl billlm la l>mmmwfemt*
1966 to 4 S » billioa at tha p^^aat tin*

Tha iebt will

now begin to iaaraan agala m oar budget deficits mount ia
tha aaaetha aheai* Thia will regain a a m rariaw mi debt
limit retiilraaaata before tha adjournal at of C ochres a.
Tha labt limit at the present time stands at 1380 bilH O B , tat mmm that will go bsck to I2TS b i U i n oa $mm SO,
I960, naasitig to the -resent I n *
m*m

fhea tha Secretary

the S a | n tow %m increase ia tha debt limit last

winter he did so m tha Mala of tha need for mmm adequate
aaah halaaan to mmmw TSnaawqr operations, wore flexibility

One of the thiags that n a n trying to Mm with m p n t
to both revenues and erpaadituraa is to keep war program
ia p a m p a k t m — to toy to i n k at budget i^olicy la tarn
af its objective* thrmgh gaal art bad than alike. Budget
policy ia made is the praasat* bat It a n t * of necessity,
look far ahaaa — months and even y n n ahead.
niftly wmZm

mmm®®.

Ta our

it la unlikely that a n a tha beat

predictions will coincide proiaely with events aa thay
aafaM*

The very success i£ the nsenhoi**r ^dainistratioa

la eattisg f a n n m a t awpaalttama* for example, toa led
n a t paople to forget that the budget as the present Hai»istntloa f mad it — the planned program for the fiscal
yaar 1354 ~ contemplated expenditures f ifS bllllm. The
p a n t Mainistretion s acceederl la citing eipenditura
bacv tolm So billion, thua paswittlag a t n reduction
emountlap; to a $7*1/2 billion cut la 1954 and irking
toward m budget be, la nee which mm achieved ia bath tha
fiaml yean im

and 195?.

Iwt at ahowt the t i n that budget htOAmmm ocaurred, both
expaniitom aai revenues b*m$m to riaa again. It a s an
uneasy balance. It m a apparaat, while wa were still ia a
boom situation, that if any lenliag af business occurred,
the anticipated haigat aarplm would not be large nnmgh to
cushion the probable decline la revenues.

Wm?

these

• f m
mm

182

almat m wall niatoiataa — l » n thm I paraaat balm

tha m a r * Umt

af tha thirl fnrtor af IW?. - tint

qpartar aspaalltana fat aanhla gm&m* mm tha othar lasaa,
ware IE panaaft balaw thair psak of a y a w aga#
€laarly, tha inrabla gaaha ana *t tha aaaaoay tea toaa
the hntaat hit* taakaa at naltatiaally *~ a w M tha t n
propanlt aaat aweaaly n®aata§ Mm

a atlnlatlag affaat

whan aiah aa affaat la aaat aaaiaie la tha iwabla ga*aa
am

The mwf fnt that the praaaat imatura fa bnalaam

lanlaprf at a t i n w h n faraaml i n o n a n at tha Mghast
Iwnl la MafeaJqf'vnU wmm to luilaata that angr aoasHam*
tlom other t k n th* ralan of apnlahla fiats a n iawlw*a.
Ia one mm*9

mm ailaan i n

aat- of 'am high ataaaari

af llwtag* *hi* faapla a n ao far ahwn a nitoiataam laral
that a nfeataatttl pnportiaa af thair aapaaaitmn a n
poatpambla^ Tha pstblia bus a aap of ahlfttag ita demnds
fm warfan ifpm af goo*a m*M aavtlma* la n

amiaty*

lt la difficult to prediet whether, % changing tax policy, m
mm ^smirably mhaaaal the bayiag Hmnntis of the pahlia.
The question of a tax cut, ?mi. m y be m§*mm&§ la under
aaafelaaan atofy by the jUHLalatmtim*

Tha iiaialatoatin

has atataB, hamasr* that it will rec^end set ion m S y *h*a
It Ummmmm

clmrly evident what dmiaim la la the best

interests mi the latloa, and Itaa oily aftor prior aonalto*
tioa with %m I m a a n af both partiaa ia C o w a n *

affmtiag mrmxy sntor nf the moaoay and tha fiaoal position
of the {jonmmat for years to e o n , aast be arrived at oaly
after tha a n t careful examination of all tha factora
involved.

Tax revision can take m a y forms aad can have

^sany different effects. It m a t ba considered ia the context
of tha aeasures which have already been adopted or a n la tha
process of baing adopted to cushion tha current decline and
to pronto well-fast if led public aonfIdann.

It must ba

examined ia t a r n of tha fisnl pnltioa of the Go v e m w a t ,
aad ia tarn of the attitudes

of people. Wa deal with a

world w h e n psychology plays a part as wall as statistical
fautitlm*

Wa m a t ask what would people im with tha

fuada released If there were a cut in taxes9
To answer thia question, wa need to take a fairly alon
look at tha speaifia character1sties of consumer incomes and
consumer spending during recent months.
I Q n wa

do this, tha first faat whiah stands oat ia

that aggregate spendable fuada ia the hands of consumers
have regained high; persoaal income in tha

nited States,

accord lag to tha last report, was oaly 1*7 paraaat lawar
than tha all-time peak. % x t 9 wa find that consumer expenditures for servlns wara at a record high duriag tha flnt
quarter of thia year* and expenditures for nondurable goads

.5-

184

aatiwtty* Th«r inhrta such thtam aa suUltlanl mpahlitani
on water n a n m a ymjaato, paat aff lan t a w program to
ail anil business aal to balp meat tha fiaanial problem
af tha rallrona*
Tha Itelalatntim ia plniag aafhmia oa leainble
mpaaaitana that a m ha n i a mmw tha abort raag a mw& tha
aaoelaratloa of aalatlag program aa6 aat oa the type mi
public works that will take many months or yean to gat. \mi*m
way mi will oaly gat lata high gear at a t i n whaa they will
aaafate with tha ataia of tha prlwato noangr*
Tkros^feoat tha ptanaft ranaa laaaqr parloi; there has
bean strong praaaan n tha Malalatntlm aal oa tha
C a p a s , aa yaa kam» for providing farthm atlnlaa to n r
eaoaoay through tax naaatlm*

This ia a prapnal whiah

must have tha aoniinad jaagnat aai thiakiag of all of us.
It is not aaaathlag whiah ahmll ba loae haatily or with waf
other motives than tha lutloaal interest. We must nigh the
aanatagn aai the aoanqpaaan — aal than ara m a y
imponderables.
fax rawaatioa looks to mm* paopla lika a siapla
imaatla n t l m whlih a w Jnaiiataly put us back oa tha nai
to axpamioa* Fnf&aatly, thorn who avga it pay littia
attention to the fact that a major change in tax rates,

-*-

185

Tha Qovarnnat has stepped up greatly tha rate of
defaim contract placements, with ^5-1/2 billion more
contracts to to let la Janmry*June 1953 than in JulyBeaaahar 1957. Of course, than la a lag between contractletting and budget-spending, bat tha stimulus to tha
contractors is already being fait*
la addltim* tha military ia doing everything possible
to mm that mora procurement is placed through small business aal through firms ia a r m s w h a n t h a n ia aa adequate
supply of available labor*
Civil works projects ara beijg accelerated ana m a y
programs ia tha January budget —

such aa urban renewal

projects aal highway program ~ ara a m expanding significantly. A total of a bout $S»1/S billioa aora ia to ba
spent oa highways la 1958 and 1959 under present plan
than would have b a n spent at tha 1957 rate.
ill ot these program ara aativa Fadaral program right
now* Furthermore, the Adaialstntioa has pit forward other
proposals to help counter recessionary tendencies. These
include extended unemployment benefit payamta — bat oaly
oa a sound baa is. There ara alao other needed programs
being argal whiah will, aa a secondary result, help stimulate

* M h tha Falaral SaaaMaat haa alnafy" tatoa taring «*•
pasaat r a n n i m ' t o laiy gat tha mmmmitw haak oa aa
a|gn&a*
Bnttaatial aaaatfmtloa-9 aa yoa tarn* is a m btiag
attmUtoa If a m ^ p A ^ i o n llbarallaiig a#wapyn»to
m i othar f m t a n a if' W& aal TOSaam* Ihla ahomli bagla
to show up ia'iaaraaaaa a m hmaixg atarta lator m thia
aprlxg*

Ih adaitim* a w a faato Mm

barn ralaaaai far

military honing aal «thm b^iliiag aalar Federallysponsored programs, and f » purchase authority oa low cost
homes has h e m significantly enlarged.
1 favttar amimfagiai faatar afftaatiag aat oaly ptvato
construction bat also the tremendous volume of sorely
naiai Stato aaaiaatf'whlttlhg rvajaata *~ m h m l s t higbmys*
hnpitalaf pblla halttUga» utility a a m i a n , ata# —

beam tha dramatic increase la the availability of credit
&aaoat|&aiaa mif aa aafaFwaa^aaftaa l u f ia iatoiNaat rataa§
paftiaalml?'' oa aaafeat aaaaritfm* Federal l a a a m m m t m y
aatlaai aariag this laat § aaaftha has been vary affaatlm ta
aai'lag'W tha'&**&&'of amllahla amait, fhna a n ianlapaaaata with whlih I kaow fm mm thaatfqjhl? fmlliar*

I *kmU

U h a to aaawrln tha kma* tmmtmmm of that

pN&gnst ia jaat a a m m k .

laaaaar* m w i t a m

l # n sight

af tha f aat that tha fatamaaaaft la a m pmnifc bnalaam
aaatlttam .aa6 tha fnwialn of Jaha w a r tka lmg

w i s t

f n a aemfttgr ara piaarily tha imfmalhllitp af Imrlaaa
kaalaam — «f ataplayan aal aaplaima — wmkiaf tagafthn*
with eoafidence, to oroduee the gnda aai nil tha products
aMah the imriaaa people aal tha people la the rest of tha
world went mA at a prim they aaa aa* will pay. Washington
oaa half ia thia Jab*, hat it oamat ia tha Jab hy itaalf *•*
The task will oaly h* completed when all Americans, taking
a aula reading of the economic signs, a w n forward with
confidence a m strength to tha n a economic achievements
ahiah all of us have reason to expect la tha months aal
gjr mmtwimi-w' a a wi6 , *^ip r aa | MW' m*

whila tha m j a r taaiaion lading to renewed growth
n a i with individuals and groups ia our type of economic
system, the 8 m a n m a A t a® ou kaew* has hmmm entrusted
vdth iaportaat responsibilities for assisting la the
maintenance of employment activity at high levels. Thm
fiaptoymnt lat of 1946 reinforces these rnponlbllitlm*
Lat m anmriaa for y m soma af tha aipilf iaaa* atop

~~/jfmS

f^-£*£**4m.--9%K

^^^y^4,.-fyt^*<y

REMARKS BY UNDER SECRETARY OF THE TREASURY JULIAN B. BAIRD
AT 38TH ANNUAL CONFERENCE OF TH? NATIONAL ASSOCIATION OF
MUTUAL SAVINGS BANKS, IN BALLROOM, HOTEL STATLER HILTON.
BOSTON, MASSACHUSETTS, FRIDAY, MAY 9, 1958, 2s3Q P¥ (IDT)
«

•IIIIIIM » A —

i 111

, . « • » — . H I 111

• 111 r i i i.

•

»<

. .

iimmi

T.I.II

mil.

«'

FINANCING YOUR FEDERAL GOVERNMENT
As one of the newer members of the Treasury team, I am
indeed happy to have this opportunity to discuss with this
group of leaders in your industry some of the problems that
we currently face in financing your Government.
At present many areas of the eeonoiqy are exparieaeing
a downturn* But the factors making for a long-term growth
trend in the economy are as strong as ever. There is every
reason to believe in the economic future of the United
States, provided, of course, that we handle our fiscal and
monetary affairs wisely.
Meanwhile, we are naturally concerned about that downturn. It represents a waste of resources, both human and
material * It means disappointment and misery for many of
our fellow Americans.
The Government is not standing idly by.

It has under-

takes a positive program for encouraging employment and
renewed expansion throughout American industry, keeping
in mind

A. ',

short-term needs as well as long-term goals.

TREASURY DEPARTMENT
Washington

189

FOR RELEASE ON DELIVERY

Remarks by Under Secretary of the Treasury
Julian B. Baird at 38th Annual Conference
of the National Association of Mutual Savings
Banks, in Ballroom, Hotel Statler Hilton,
Boston, Massachusetts, Friday, May 9, 1958,
2:30 P.M. (EDT).
FINANCING YOUR FEDERAL GOVERNMENT

As one of the newer members of the Treasury team, I am
indeed happy to have this opportunity to discuss with this
group of leaders in your industry some of the problems that
we currently face in financing your Government.
At present many areas of the economy are experiencing
a downturn. But the factors making for a long-term growth
trend in the economy are as strong as ever. There is every
reason to believe in the economic future of the United States,
provided, of course, that we handle our fiscal and monetary
affairs wisely.
Meanwhile, we are naturally concerned about that downturn. It represents a waste of resources, both human and
material. It means disappointment and misery for many of our
fellow Americans.
The Government is not standing idly by. It has undertaken
a positive program for encouraging employment and renewed
expansion throughout American industry, keeping in mind
short-term needs as well as long-term goals.
I should like to summarize the broad features of that
program in just a moment. However, we must never lose sight
of the fact that the improvement In our present business
conditions and the provision of jobs over the long run in a
free country are primarily the responsibility of American
business — of employers and employees — working together,
with confidence, to produce the goods and sell the products
which the American people and the people in the rest of the
world want and at a price they can and will pay. Washington can
A-235

'^': i
<y \y

- 2 help do this job, but it cannot do the job by itself. The
task will only be completed when all Americans, taking a
calm reading of the economic signs, move forward with
confidence and strength to thb new economic achievements which
all of us have reason to expect In the months and years ahead.
While the major decisions leading to renewed growth
rest with individuals and groups In our type of economic
system, the Government, as you know, has been entrusted with
important responsibilities for assisting in the maintenance
of employment activity at high levels. The Employment Act
of 19^6 reinforces these responsibilities. Let me summarize
for you some of the significant steps which the Federal
Government has already taken during the present recession to
help get the economy back on an upgrade.
Residential construction, as you know, is now being
stimulated by new regulations liberalizing downpayments
and other features of FHA and VA loans. This should begin
to show up in increased new housing starts later on this
spring. In addition, more funds have been released for
military housing and other building under Federally-sponsored
programs, and FNMA purchase authority on low cost homes has
been significantly enlarged.
A further encouraging factor affecting not only private
construction but also the tremendous volume of sorely
needed State and local building projects — schools, highways,
hospitals, public buildings, utility services, etc. -- has
been the dramatic increase in the availability of credit
accompanied by an unprecedented drop in interest rates,
particularly on market securities. Federal Reserve monetary
action during this last 6 months has been very effective in
adding to the supply of available credit. These are developments
with which I know you are thoroughly familiar.
The Government has stepped up greatly the rate of
defense contract placements, with" $5-1/2 billion more contracts
to be let in January-June 1958 than in July-December 1957.
Of course, there is a lag between contract-letting and
budget-spending, but the stimulus to the contractors is
already being felt.
In addition, the military is doing everything possible
to see that more procurement is placed through small business
and through firms in areas where there is an adequate supply
of available labor.
Civil works projects ar>e being accelerated and many
programs in the January budget -- such as urban renewal
projects and highway programs -- are now expanding significantly.

1 y1

- 3A total of about $2-1/2 billion more is to be spent on highways in 1958 and 1959 under present plans than would have been
spent at the 1957 rate.
All of these programs are active Federal programs right
now. Furthermore, the Administration has put forward other
proposals to help counter recessionary tendencies. These
include extended unemployment benefit payments — but only
on a sound basis. There are also other needed programs being
urged which will, as a secondary result, help stimulate
activity. They include such things as additional expenditures
on water resources projects, post offices, new programs to
aid small business and to help meet the financial problems of
the railroads.
The Administration Is placing emphasis on desirable
expenditures that can be made over the short range and the
acceleration of existing programs and not on the type of
public works that will take many months or years to get under
way and will only get into high gear at a time when they will
compete with the needs of the private economy.
Throughout the present recessionary period there has
been strong pressure on the Administration and on the Congress,
as you know, for providing further stimulus to our economy
through tax reduction. This is a proposal which must have the
considered judgment and thinking of all of us. It is not
something which should be done hastily or with any other
motives than the National interest. We must weigh the
advantages and the consequences — and there are many
imponderables.
Tax reduction looks to some people like a simple dramatic
action which can immediately put us back on the road to
expansion. Frequently, those who urge it pay little attention
to the fact that a major change in tax rates, affecting
every sector of the economy and the fiscal position of the
Government for years to come, must be arrived at only after
the most careful examination of all the factors involved. Tax
revision can take many forms and can have many different
effects. It must be considered in the context of the measures
which have already been adopted or are in the process of being
adopted to cushion the current decline and to promote we 11justified public confidence. It must be examined in terms
of the fiscal position of the Government, and in terms of the
attitudes of people. We deal with a world where psychology
plays a part as well as statistical quantities. We must ask
what would people do with the funds released if there were a
cut answer
in
To
consumer
look
attaxes?
the
spending
this
specific
question,
during
characteristics
recent
we need
months.
tooftake
consumer
a fairly
incomes
close
and

192
- k When we do this, the first fact which stands out is
that aggregate spendable funds in the hands of consumers have
remained high; personal income in the United States, according
to the last report, was only 1.7 percent lower than the
all-time peak. Next, we find that consumer expenditures for
services were at a record high during the first quarter of
this year, and expenditures for nondurable goods were almost
as well maintained — less than 1 percent below the record level
of the third quarter of 1957. First quarter expenditures
for durable goods, on the other hand, were 12 percent below
their peak of a year ago.
Clearly, the durable goods area of the economy has been
the hardest hit. Looked at realistically -- would the tax
proposals most commonly suggested have a stimulating effect
where such an effect is most needed, in the durable goods
area? The very fact that the present downturn in business
developed at a time when personal income was at the highest
level in history would seem to indicate that many considerations
other than the volume of spendable funds are involved.
In one sense, our dilemma grows out of our high standard
of living. Our people are so far above a subsistence level
that a substantial proportion of their expenditures are
postponable. The public has a way of shifting its demands
for various types of goods and services. In our free society,
it is difficult to predict whether, by changing tax policy, we
can measurably rechannel the buying demands of the public.
The question of a tax cut, you may be assured, is under
continuous study by the Administration. The Administration
has stated, however, that it will recommend action only when
it has become clearly evident what decision is in the best
interests of the Nation, and only after prior consultation
with the leaders of both parties in Congress.
One of the things that we are trying to do with respect
to both revenues and expenditures is to keep our programs
in perspective — to try to look at budget policy in terms
of its objectives through good and bad times alike. Budget
policy is made in the present, but it must, of necessity,
look far ahead — months and even years ahead. In our
swiftly moving economy, it is unlikely that even the best
predictions will coincide precisely with events as they unfold.
The very success of the Eisenhower Administration in cutting
Government expenditures, for example, has led most people to
forget that the budget as the present Administration found it —
the planned program for the fiscal year 1954 — contemplated
expenditures of $78 billion. The present Administration
succeeded in cutting expenditures back below $65 billion, thus
permitting
in both
1954 the
and aworking
fiscal
tax reduction
years
toward1956
a
amounting
budget
and 1957.
balance
to a $7-1/2
whichbillion
was achieved
cut

193
- 5 But at about the time that budget balance occurred, both
expenditures and revenues began to rise again. It was an
uneasy balance, It was apparent, while we were still in a
boom situation,that if any leveling of business occurred,
the anticipated budget surplus would not be large enough to
cushion the probable decline in revenues. Under these
circumstances, we would be back In a deficit situation similar
to the one which had been corrected earlier.
The leveling in business has occurred. And it has been
accompanied by a new development, the increased threat to
our security raised by Soviet scientific advances — with
their new military potentials. These new factors in the
international situation, plus the speed-up of needed domestic
programs, are expected to carry Federal Government expenditures
back to at least $73 billion in the next fiscal year, with a
substantially larger deficit than the prospective $3 billion
deficit for fiscal 1958.
Our setting in the management of the public debt, therefore, is changing abruptly. Budget surpluses made it
possible to reduce the debt from $28l billion in December
1955 to $275 billion at the present time. The debt will
now begin to increase again as our budget deficits mount in
the months ahead. This will require a new review of debt
limit requirements before the adjournment of Congress.
The debt limit at the present time stands at $280 billion,
but even that will go back to $275 billion on June 30, 1959*
according to the present law. hhen the Secretary asked
the Congress for an Increase in the debt limit last winter
he did so on the basis of the need for more adequate cash
balances to cover Treasury operations, more flexibility in
handling debt management, and an allowance for contingencies
which might arise. Any new review must incorporate the same
considerations as well as the prospect of increased deficits.
We will continue our efforts in the Treasury to improve
the structure of the public debt. It is an important goal
and we believe that it is an essential adjunct to monetary
policy as well as being sound fiscal policy in itself.
Good debt management must contribute to the financial soundness of the economy, and this means that it must endeavor
to correlate with monetary policy to the greatest extent
practicable, rather than setting up cross currents which would
run contrary to appropriate actions in that field..
Debt management can serve this purpose best in two
ways -- first, by reducing the volume of refunding operations,
and, second, by reducing the number of times which the Treasury
must go to the market. Treasury financing operations, as you

1^4
know, not only compete for funds with corporate and municipal
financing, but they reduce the period of time during which
the Federal Reserve has relative freedom to operate. When a
single borrower accounts for one-third of the entire debt
of the country — as the Federal Government does today —
it is an obvious fact that such a borrower must compete if he
is to meet his borrowing requirements. The Treasury competes
when money is tight. It competes when money is easy. The
question isn't whether we compete or not; it is, rather,
what form our competing takes.
With respect to the number of times the Treasury must
enter the market during a given period, the Federal Reserve
and the Treasury both recognize that a major Treasury offering is an important event in the financial world; the market
must prepare for It ahead of time, and it must have a sufficient
period afterwards for thorough absorption of the new issue.
This necessarily limits the period during which the Federal
Reserve can use monetary policy with greatest effectiveness.
It is our aim to work toward cutting the number of trips to
the market. We believe the best months for our future
maturities, except for seasonal borrowing, are probably
February, May, August, and November, Whatever our intentions,
it will be many years before the Treasury can hope to attain
these goals.
While assistance to monetary policy is a major
responsibility of debt management, lengthening the debt
is also an important long-run policy goal from the standpoint
of the Treasury alone. First of all, it is necessary to work
continually at lengthening the debt In order to keep the total
from shortening as a result of the mere passage of time.
In the last five years, the Treasury has managed to keep the
length of the marketable debt at about five years1 average
duration. This has taken unremitting effort. We have issued
$6 billion of 20-year and over bonds and $33 billion of
5- to 20-year bonds to do this. Difficult as it may be at
times to pursue our goal of debt-lengthening, we can never
lose sight of our objective. In addition to all the other
considerations of monetary policy and prudent management of
the public's funds, we must leave sufficient leeway in the
short-term area at all times so that a sizable volume of
short-term loans could be successfully placed should special
circumstances require It. It would be unwise in the extreme
to fully employ this source of funds under less urgent conditions.
For all of these reasons, therefore, improvement in the
debt structure through lengthening debt maturities when
possible is an important goal of Treasury debt management.
But
the when
nub of
are
thesuch
question.
actions possible and desirable? This is

- 7-

195

Now, according to classical theory, the Treasury should
go at the problem by selling long-term securities when
monetary policy is restrictive, thereby helping to withdraw
funds from the private capital markets when demands for
such funds are considered excessive. Likewise, the theory
holds that the Treasury should concentrate on selling shortterm securities when the monetary policy is one of ease,
thus strengthening the factors in the economy making for
greater liquidity and readier availability and use of credit.
But in actual fact, there are serious difficulties in
the way of putting these fine principles into effect. I am
sure that your own Investment experience will confirm the
fact that debt management is one of the many areas where
classical economic theory can be a somewhat unreliable guide
to real life as we find it. We must sell our securities to
specific buyers in a real market, not in a hypothetical
market which is perfectly fluid and perfectly responsive to
desirable changes in policy. If the Treasury tries to force
long-term securities on investors during a period when
interest rates are high and funds are being eagerly sought
for private purposes, the resulting market disorder might
actually interfere with the effectiveness of Federal Reserve
policy rather than contribute to it. If the market threatened
to become so disorderly that the Federal Reserve had to step
in to any significant extent, this might require the
Federal Reserve to back up temporarily on policies which were
deemed essential to the good health of the economy at that time.
Furthermore, it would not be in the Treasury's, and
hence the taxpayer's, interest to put out an inordinate
amount of long-term debt at the relatively high Interest
rates that prevail in a period of firm credit restraint.
Considerations of this sort would seem to indicate that —
contrary to classical theory — the Treasury should not
rule out consideration of the sale of long-term securities
when monetary policy is one of credit ease. Yet we must not
be unmindful of what that course involves. During periods
when the Federal Reserve is easing credit to stimulate
business activity, the Treasury must weigh its debt management
objectives in the light of both the short- and long-run
welfare of the economy and the desirability of being of
assistance by not absorbing funds which might better serve
the economy if used for private purposes.
Having the dual responsibility of bearing in mind the
goal of a better maturity distribution of the debt and
equally considering the welfare of the economy, we in Treasury
doubt the wisdom of strict adherence to precise formulas
to
simply.
guide our
It seems
actions.
to usWo
that,
wishin
debt
each
management
instance,were
we must
thattry

196
- 8to weigh all the factors, such as the technical position of
the market, the availability of credit to the corporate,
municipal, and mortgage markets, the impending corporate
and municipal calendar, and the special needs of various
types of investors, and then make the difficult decision as
to what course of action we judge will make the greatest
contribution to the public interest — not only in the
weeks immediately ahead but over the longer range.
Some debt extension can, of course, be accomplished
entirely outside the area of competition for new funds by
making it attractive for investors such as mutual savings
banks, insurance companies, pension funds, etc., to lengthen
their own portfolios by replacing some of their short- and
intermediate-terms with longer-terms. The short- or Intermediate
term securities which these savings type of institutions sell
would, for the most part, be acquired by the commercial banks.
The average term to maturity of Government securities held by
mutual savings banks, for example, is about 8 years to first
call date, as against almost 14 years in 1946. There may be
some merit in encouraging debt lengthening within portfolios
even at times when the net amount of new money available for
investment in Federal securities Is small, without running the
risk of competing unnecessarily for funds needed to support
renewed expansion.
It should also be remembered, of course, that, quite
apart from the sale of long-term bonds, the Treasury can
achieve considerable success in debt lengthening by selling
intermediate-term securities to commercial banks in a period
such as this. For example, the Treasury made more progress
in debt lengthening during 1954 than in any other calendar
year since World War II, yet no issues running more than 10
years to maturity were put out during that year.
By far the most important part of Treasury new money
borrowing during a recessionary period is properly done
through the commercial banks, and we have no reason to
believe that our experience in this recession will be any
different. As I have suggested, however, in the process of
concentrating on bank borrowing, we should not immediately
assume that it will all be short-term borrowing or that
consideration of nonbank sources of funds should be neglected
entirely.
These are some of the thoughts which I want to leave
with you in the hope they will stimulate you in giving us
the benefit of your own thinking on these important matters.
Tha Treasury, as you are well aware, does not work in an
ivory
tower.
It
is
our
jobbe
to
painstakingly
out
demand
the
market
insofar
wants
asand
that
attempt
can
to
done
tailor
consistent
issuesfind
with
to meet
thewhat
that
other
*

- 9-

1 Q7
-L y i

objectives which we have to keep in mind. To aid us in
this, we listen intently to suggestions and ideas from groups
such as yours. We hope that many of you — individually, as
well as through your Committee on Government Securities and
the Public Debt -- will come in and talk over with us any
thoughts you may have which might help us to do our job better.
And finally I would like to say a word about United States
Savings Bonds.
In our judgment, the Savings Bond program has been of
inestimable help not only to the Government and the 40 million
people who hold the bonds but also to the whole thrift and
savings industry. To some of you the Savings Bond program
may appear to be only another form of competition and,
perhaps, unwarranted competition. In my judgment — and I
have been a banker all my business life — this has always
seemed to me a shortsighted point of view.
I am not so naive as to believe that, if someone walks
into one of your Institutions to make a deposit, you are
going to suggest that the person buy a Savings Bond instead.
On the other hand, I don't think it's good public relations
to do the reverse.
The Savings Bond program could not have achieved Its
great success without the support of the vast majority of
the banking institutions of this country. The Payroll
Savings plan, which Is the mainstay of the Savings Bond
program as It exists today, does a job that the savings
institutions cannot do as effectively. Very few employers
want to put on an active sales campaign In their respective
organisations to sell savings accounts for any single private
institution. They can do so in good conscience with United
States Savings Bonds. Literally millions of Amorleans have
accumulated their first savings through payroll deductions,
and having once acquired the habit of thrift, they become the
customers of other types of savings institutions who offer a
more varied service. These savers accumulate nest eggs that
have permitted downpayments on countless homes which you have
financed and on all sorts of durable goods which could not
otherwise have been acquired.
Now some people may ask you, as they have asked me -"Why is the Government promoting Savings Bond sales at this
particular time? In view of the current business decline,
wouldn't it perhaps be better to encourage our citizens to
buy things rather than adding to their financial reserves?"
The question is not a new one. I understand that.
during every business decline in the postwar period, similar
questions have been put to the Treasury.

- 10 -

If one concentrates on current business indexes and
trends, it is often easy, of course, to temporarily lose
sight of the long-term sustaining forces that have made our
country great. Ranking very high among these forces is the
habit of thrift, upon which depends the sound financing of
our Nation's industrial might as well as providing a backlog
of savings for millions of our people.
The habit of thrift Is not something to be encouraged
at one time and discouraged at another. It is much too
basic. As a matter of fact, the present economic downturn
is the aftermath of an inflationary boom which would have
been much milder had Americans saved more than they did
during recent years. When we encourage the habit of thrift,
we are strengthening the foundations of private enterprise
and industry which have made our economy the most productive
in the world.
I am sure you will continue to give your support to the
Government's program of sharing in America through the
purchase of United States Savings Bonds.
If I have accomplished nothing else today, I hope I
have conveyed the Idea that the problems we face are not easy
of solution. I can promise you that the Administration will
continue to face up to them in the long-range best interests
of the people of America.

0O0

19'

f\ -^

mm-sn A.m. wmsmmm,
Tuesday, my

13, 1956*

The Treasury ®mpmrtmnt mmmwm*4

lest evening that the tenders for #1,?00,000,OC

or thereabouts, of fl-day Treasury bills t® ba dated lay 15 and to mature August Ik,

1958, whieh were offered on Hay 8, were opened at the Federal fteeerf* Banks on May 12
Tha details of this issue are as followsi
Total applied for *• $2,63$,0kk9Q0Q
Total aeeepted
* 1,700,687,000 (includes |2§8,6©6,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
lange of accepted competitive bids:
High

* 99*130 Equivalent rate of discount approx. 1.068$ omr
- 99*71$
«
n »
«
«
x,\n%
•

Average

~ **.71*

l.llt* "

(5l nereent of the asount bid for at the low priee was accepted) '
Federal leserve
District

Total
Applied for

Total
Accepted

Boston
lew York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. louis
fflnneapolia
Saneee'City
Bellas
San franeieee

#'. 36,935,000
1,875,281$ ,000
kl,685,000
If,21*0,000
15,811,000
la,175,000
266,610,000
21,810,000
18,701,000
55,972,000
29,611,000
176,210,000
#2,635,01*14,000

# 26,935,000
1,052,32ii,000
W, 685,000
kf9 210,000
15,811,000
37,7^0,00©
201*,1140,000
21,010,000
18,701,000
50,360,000
611,000
220,000
11,700,627,000
160

TOTAL

TREASURY DEPARTMENT
WASHINGTON, D.C.
EELEA.SE A . M . NEWSPAPERS,
Tuesday, May 13, 1958.

A-236

The Treasury Department announced last evening that the tenders for $1,700,000,000,

or thereabouts, of 91-day Treasury bills to be dated May 15 and to mature August X

1958, which were offered on May 8, were opened at the Federal Reserve Banks on May
The details of this issue are as follows s
Total applied for - #2,635,0l*l*,OOO
Total accepted
- 1,700,627,000 (includes #288,696,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Range of accepted competitive bidss
High
Low

- 99.730 Equivalent rate of discount approx. 1.068$ per annum
- 99*11$
»
M a n
n
1.127* «
m

Average

- 99.719

£#il2# w

(5l percent of the amount bid for at the low price was accepted)
Federal Reserve
District
Boston
New Tork
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

Total
Applied for
% 36,935,000
l,875,28ii,000
1*7,685,000
1*9,21*0,000
15,811,000

ia,i75,ooo
266,610,000
21,810,000
18,701,000
55,972,000
29,611,000
176,210,000
TOTAL $2,635,0l*li,000

Total

%
26,935,000
l,052,32l*,000
39,685,000
1*9,21*0,000
15,811,000
37,790,000
20U,ll40,000
21,810,000
18,701,000
50,360,000
23,611,000
160,220,000
$1,700,627,000

RELEASE A. U.
WmiWAmS,
Wednesday, May 14, 1958.

A- X2T)

The treasury Department toiar issued the offteial aotiaaa of call for redei^tloa
on September 15, 1SS8, of the 2-1/4 peroent fraasury Bonds of 2 M M 9 , ^ated February
1944, due Sepfceafcer 15, 1959, and the E-3/S paaeart treasury Bond® of 1957*59, dated
March 1, 1952, due Harch is, 3J5S. fhere are now outstanding. $3,018,075,000 of the a*
percent bonds and $a&6,811,000 of the 2-3/8 percent bonds.
®ie teats of the ftosael notioes of ©all $m m follows*

To Holders of 2-1/4 percent treasury Bonds of 1958-59, and Others Qonoemedf
l. fubHc notice is hereby given that mil outstanding 2-1/4 percent Emgury Bon
of 1956-59, dated February 1, 1944, due ief^e^er 15, 1959, are hereby called for rede
tlon on September 15, 2*88, on ifeieh date interest oa mmb bonds will
2. tmUmrm of these bonds say, in adaraace of the radiation date, he offered tfas
privilege of exchanging all or my part of their called bonds tor other lnia3?agt*%stf|
obligations of the Halted States, in whioh event publio notice will hereafter he givm
and an official circular governing the exchange offering will be issued.
3. full information regarding the presentation and surrender of the bonds for m
redemption under this call will be found in Bep&rtmant Circular Bo. 300, Bevised, dale!
April 50, 1955.
Bobert B* t^mm^m*™,,

mormtmry of the treasury.

TREASURY immmm,
Washington, my 14, 1958.

T®Q A I D TaB^LmhrnmLim gfficair

Bflg ^ S —

"*•*•

tmwnrntommgpuro
To Holders of 2-3/8 percent treasury Bonds of lS57*aa, and Others Concerned:
1. Public notloe is heraby giaaa that all outstanding 2-3/8 percent Treasury %%wi
of 1957-59, datad itaeh 1, 1952, due mmb 15, last, are hereby mXlmH tor vadsasiiaai
September IS, 1958, on which date interest on auah bonds will
2. Bolters of these bonds may, in advanee of the zatagftiaft data, be offered «l»
privilege of ^hanging all or any part of thair aalXad bonds tor other int@rest*hearli
obligations ot the United itates, ia iaaafe mmt $mUo aatiaa will hereaffcer be glwa
and an official circular governing the exchange offering will ba Issued.
5. Full information regarding mm presentation and surrender of the bonds for m
redaoption under this call will be found in INgpejrtaaant Circular Wo* 300, Bevised, mm
April SO, 1955.
Bobert B» Anderson,
Secretary of the treasury*
TSEASUBX DSPABSMBK,
Washington, May 14, 1958.

TREASURY DEPARTMENT
ft

RELEASE A. M. NEWSPAPERS,
Wednesday, May 14, 1958.

W A S H I N G T O N , D.C.
A-237

The Treasury Department today issued the official notices of call for redemption
on September 15, 1958, of the 2-1/4 percent Treasury Bonds of 1956-59, dated February
1944, due September 15, 1959, and the 2-3/8 percent Treasury Bonds of 1957-59, dated
March 1, 1952, due March 15, 1959. There are now outstanding $3,818,075,000 of the
2-1/4 percent bonds and $926,811,000 of the 2-3/8 percent bonds.
The texts of the formal notices of call are as follows?
TWO MP ONE-QUARTER PERCENT TREASURY BONDS OF 1956-59

"iWmFFwtjAKf i, leur*"™^ ~~
NOTICE OF CA3X TOR REDEMPTION
To Holders of 2-1/4 percent Treasury Bonds of 1956-59, and others Concerned;
1. Public notice is hereby given that all outstanding 2-1/4 percent Treasury Bonds
of 1956*59, dated February 1, 1944, due September 15, 1959, are hereby called for redemption on September 15, 1958, on which date interest on such bonds will cease.
R2. Holders of these bonds may, in advance of the redemption date, be offered the
rivilege of exchanging all or any part of their called bonds for other interest-bearing
obligations of the United States, in which event public notice will hereafter be given i
and an official circular governing the exchange offering will be issued,
3. Full information regarding the presentation and surrender of the bonds for cash
redemption under this call will be found in Department Circular No. 300, Revised, dated
April 30, 1955.
Robert B. Anderson,
Secretary of the Treasury,
TREASURY DEPARTMENT,
Washington, May 14, 1958.
TWO AND THREE-EIGHTHS' PERCENT TREASURY BONDS OF 1957-59

~ ~ ~ ~ ^ ^ " ~ H n ^ ^ m MRClTl, ' 19520"-"
NOTICE OF CALL FOR REDEMPTION
to" Holders of 2-3/8 percent Treasury Bonds of 1957-59, and Others Concerned:
1. Public notice is hereby given that all outstanding 2-3/8 percent Treasury Bonds
Of 1957-59, dated March 1, 1952, due March 15, 1959, are hereby called for redemption on
^ptember 15. 1958, on which date interest on such bonds will cease.
It•
2. Holders of these bonds may, in advance of the redemption date, be offered the
Privilege of exchanging all or any part of their called bonds for other interest-bearing
obligations of the United States, in which event public notice will hereafter be given
and an official circular governing the exchange offering will be issued.
3. Full information regarding the presentation and surrender of the bonds for cash
Ademption under this call will be found in Department Circular No. 300, Revised, dated
*"•

1955

' Robert B. Anderson,
Secretary of the Treasury.

TREASURY

0 rrtJ

: Tr,

™ ^' ' rt ™

-3•"JQmK f~\ ,~\ r\
•L. *J y

or by any local taxing authority. For purposes of taxation the amount of discount
at which Treasury bills are originally sold by the United States is considered to
be interest. Under Sections h$\x (b) and 1221 {$) of the Internal Revenue Code of
195U the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed of,
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 1*18, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch.

- 2 -

*3HB&

^'-

2 percent of the face amount of Treasury bills applied for, unless the tenders a
accompanied by an express guaranty of payment by an incorporated bank or trust
company.
Immediately after the closing hour, tenders will be opened at the Federal Reserve Banks and Branches, following which public announcement will be made by the
Treasury Department of the amount and price range of accepted bids.

Those sub-

mitting tenders will be advised of the acceptance or rejection thereof. The
Secretary of the Treasury expressly reserves the right to accept or reject any or
all tenders, in whole or in part, and his action in any such respect shall be
final. Subject to these reservations, noncompetitive tenders for $200,000 or less
without stated price from any one bidder will be accepted in full at the average
price (in three decimals) of accepted competitive bids.

Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on

May 22, 1958

, in cash or other immediately available funds

or in a like face amount of Treasury bills maturing

May 22, 1958

• Cash

as
and exchange tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in exchange and
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the
sale or other disposition of the bills, does not have any exemption, as such, and
loss from the sale or other disposition of Treasury bills does not have any
special treatment, as such, under the Internal Revenue Code of 1951*. The bills
are subject to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter imposed on the principal
or interest thereof by any State, or any of the possessions of the United States,

83&X&3&X3C
TREASURY DEPARTMENT A\r- — ^ —'

Washington

A. M.
SSffit RELEASE/ MBSBQBJK NEWSPAPERS,
Thursday, May 15, 1958
.
The Treasury Department, by this public notice, invites tenders for
$ 1,800,000,000 , or thereabouts, of 91 -day Treasury bills, for cash and
in exchange for Treasury bills maturing May 22, 1958 _, in the amount of
$ 1,800,701,000 , to be issued on a discount basis under competitive and non-

w* —
competitive bidding as hereinafter provided. The bills of this series will be
dated May 22, 1958 , and will mature August 21, 1958 , when the face
_

^ _

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
closing hour,/tone o'clock p.m., Eastern/SJumdajeA time, Monday, May 19, 1958
Tenders will not be received at the Treasury Department, Washington.

,«

Each tender

TREASURY DEPARTMENT

TI^

WASHINGTON, D
RELEASE A.M. NEWSPAPERS,
Thursday, May 15, 1958.

A-238

The Treasury Department, by this public notice, Invites tenders
for $1,800,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing May 22, 1958,
in the amount of $1,800,701,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated May 22, 1958,
and will mature August 21, 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, May 19, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e.g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from Incorporated banks and trust companies and from
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by.an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
^ a c c e p t a n c e or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or in part, and his action in any such respect shall be
inT
Sublectto these reservations, non-competitive tenders for
4200 000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2 competitive bids* Settlement for accepted tenders In accordance
with the bids must be made or completed at the Federal Reserve Bank
on May 22, 1958,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing May 22, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any speeial treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter imposed
on the principal or Interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be Interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
Issued hereunder need include in his Income tax return only the
difference between the price paid for such bills, whether on
original Issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their Issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch*

oOo'

COTTON WASTES
(In pounds)
COTTON CARD STRIPS made-from cotton having a staple of less than 1-3/16 inches in length, COMBER
WASTE, LAP WASTE, SLIVER WASTE, AND ROVING 7»fASTE, 'WHETHER OR NOT MANUFACTURED OR OTHERWISE
ADVANCED IN VALUEi Provided, however, that not more than 33-1/3 percent of the quotas shall
be filled by cotton wastes other than comber wastes made from cottons of 1-3/16 inches or more
in staple- length in the- case- of the following countriest United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany, and Italys

Country of Origin
United Kingdom .
Canada
France . . . . . .
British India . ,
Netherlands
Switzerland
Belgium . .
Japan • • .
China . . .
Egypt . . .
Cuba . . . .
Germany . .
Italy . . .

Established
TOTAL QUOTA

Total Imports
Sept. 20, 1957, to
Mav l y i g q a

4,323,457
239,690
227,420
69,627
68,240
44,388
38,559
341,535
17,322
8,135
6,544
76,329
21,263

910,807
239,690

5,482,509

1,234,811

if Included in total imports, column 2.
Prepared in the Bureau of Customs.

Established
33-1/3$ of
Total Quota
1,441,152

Imports
Sept. 20, 1957,
to Mav 13. 1958
910,807

75,807
66,265
22,747
14,796
12,853

11,134
St?!1?

25,443
7,088
1,599,886

11,134

6,915
928,856

TREASURY DEPARTMENT
Washington
IMMEDIATE RELEASE,
Thursday, May 15, 1958.

A-239

O
Preliminary data on imports for consumption of cotton and cotton waste chargeable to the quotas
established by the President»-s Proclamation of September 5, 1939, as amended

cx:

COTTON (other than linters) (in pounds)
Cotton under 1-1/8 inches other than rough or harsh under 3/4"
Imports Sept. 20, 1957. to May 13. 1958
,
Country of Origin,
Egypt and the AngloEgyptian Sudan . . .
Peru . .
. . • . • . a
....
British India
* . • . • - •
China .
Mexico • • • • » • « •
Brazil • .r. v • . . •
Union of Soviet
Socialist Republics •
Argentina
••
Haiti . . . . . . . . .
•
• 9
Ecuador . . . .

Established Quota
783,816
247,952
2,003,483
1,370,791
8,883,259
618,723
475,124
5,203
237
9,333

Country of Origin

Imports

7,296

8,883,259
600,000

Honduras ..*»<» *
Paraguay
.......
Colombia . . . . . . .
Iraq . o . . . . . . «
British East Africa . .
Netherlands E. Indies.
Barbados
l/0ther British W. Indies
Nigeria
• .
2/0ther British W. Africa
j/Other French Africa . .
Algeria and Tunisia .

Established Quota

Imports

752
871
124
195
2,240
71,388
21,321
5,377
16,004
689

if Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
/ Other than Gold Coast and Nigeria.
/ Other than Algeria, Tunisia, and Madagascar.
Cotton 1-1/8" or more
•
Imports Augusft 1, 195Y to fca. 31, IQ57f incl,
Established Quota (Global) Imports
45,656,420 45,656,420

TREASURY DEPARTMENT
Washington
IMMEDIATE RELEASE,
Thursday, May 15, 1958.

A-239

Preliminary data on imports for consumption of cotton, and.cotton waste jchargeable to the quotas
established by.the President*^ Proclamation of September 5, 1939, as amended
COTTON (other than linters) (in pounds)
Cotton under 1-1/8 inches other i;han rough or harsh under 3/4tt
Imports Sept. 20, 1957. to May 13. 1958
Country of Origin, Established Quota Imports * Country of Origin Established Quota Imports
Egypt and the Anglo- Honduras •••••• . 752
Egyptian Sudan . . .
783,816
Peru • • . . . . . . .
247,952
British India . . . . .
2,003,483
China
1,370,791
Mexico
8,883,259
Brazil . . . v . . . .
618,723
Onion of Soviet
Socialist Republics .
475,124
Argentina
5,203
Haiti
237
Ecuador . . . . . . . .
9,333

7,296
8,883,259
600,000
=

Paraguay . . . . . . .
Colombia . . . . . . .
Iraq
British East Africa . .
Netherlands E. Indies.
Barbados
l/Other British W. Indies
Nigeria . . . . . .
.
2/0ther British W. Africa
,2/Other French Africa . .
Algeria and Tunisia •

871
124
195
2,240
71,388
21,321
5,377
16,004
689

if Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
2/ Other than Gold Coast and Nigeria.
2/ Other than Algeria, Tunisia9 and Madagascar.
Cotton 1-1/8" or more
Imports AuguitJ.,,, 195Y, to p ^ . n , 1057T im»i.
Established Quota (Global) Imports
45,656,420

45,656,420

-aGOTTON WASTES
(In pounds)
COTTON CARD STRIPS'made from cotton having a staple of less than 1-3/16 inches m length, COMBER
WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE, WHETHER OR NOT MANUFACTURED OR OTKuJlvYISiJ,
ADVANCED IN VALUEs Provided, however, that not more than 33-1/3 percent of the quotas shall
be filled by cotton wastes other than comber wastes made from cottons of 1-3/16 inches or more
in staple length in the case of the following countriess United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany, and Italy.

Country of Origin

: Established
s TOTAL QUOTA
i

United Kingdom . . . . .
Canada . . . . . . . . .
France . . . . . . .
..
British India.-. . . . . .
Netherlands . . . . . . .
Switzerland . . . . . . .
Belgium .
Japan . . • « . • • . . .

4,323,457
239,690
227,420
69,627
68,240
44,388
38,559
341,535

C h i n a ...........
Egypt . '. . . . • « . . .

1 /, y*-mo,i^p

Cuba . . . . . . . . . .
Germany
Italy . . . .
......

6,544
76,329
21.263

Total Imports
% Established .
Imports
.
- * •
i Sept. 20, 1957. to : 33-3/3* of s Sept. 20, 1957,
% Mav 13. 1958
i Total Quota s to Mav 13. 1958
910,807
239,690
66^265
-

5,482,509 1,234,811 1,599,886 ' 928,856
1/ Included in total imports, column 2.
Prepared in the Bureau of Customs.

°~
""

11,134
6,915

1,441,152
75,807
- .
22,747
14,796
12,853
_ —""
""

—
25,443
7,088

910,807

*•
•"

11,134
6,915

- 2-

Commodity

Cmm.^

Period and Quantity

Unit
:
of
: Imports as of
Quantity: May 3, 1958

Absolute Quotas;
Peanuts, shelled, unshelled,
blanched, salted, prepared, or
preserved (incl. roasted pea- 12 mos. from
nuts but not peanut butter)... Aug. 1, 1957

Pound

Quota Filled

Rye, rye flour, and rye meal 12
.. mos. from
July 1, 1957
Canada
182,280,000
Other Countries
3,720,000

Pound
Pound

Quota Filled

Butter substitutes, including
butter oil, containing 45$
or more butterfat

1,200,000

Pound

1,199,952

Feb. 1 - Oct. 31, 1958
Argentina
18,475,901
Paraguay
2,437,128
Other Countries
739,366

Pound
Pound
Pound

1,699,244*
Quota Filled
Quota Filled

Tung oil

* Imports as of May 13, 1958.

Calendar Year

1,709,000

TREASURY DEPARTMENT
Washington

IMMEDIATE RELEASE,
Thursday, May 15, 1958.

211
lt 2 40

Unit \
of : Imports as of
Quantity: May 3. 1958

Commodity

Tariff-Rate Quotas:
Cream, fresh or sour Calendar Year

1,500,000

Gallon

Whole milk, fresh or sour .... Calendar Year

3,000,000

Gallon

Cattle, less than 200 lbs. each 12 mos. from
April 1, 1958

200,000

Head

4,729

120,000

Head

22,347

Cattle, 700 lbs. or more each Apr. 1, 1958 (other than dairy cows)
June 30, 1958
Fish, fresh or frozen, filleted,
etc., cod, haddock, hake,
pollock, cusk, and rosefish .. Calendar Year

35,892,221

Tuna fish Calendar Year

44,693,874 Pound

White or Irish potatoes:
Certified seed
Other

12 mos. from
Sept. 15, 1957

Pound

Ll4,000,000 Pound
36,000,000 Pound

Quota Filled
12,490,011
Quota Filled
Quota Filled

Walnuts Calendar Year

5,000,000 Pound

1,717,585

Almonds, shelled, blanched,, .,
roasted, or otherwise prepared Oct. 23, 1957 or preserved
Sept. 30, 1958

5,000,000 Pound

4,887,005

Alsike clover seed 12 mos. from
July 1, 1957

3,000,000 Pound

233,457

Peanut oil 12 mos. from
July 1, 1957
Woolen fabrics Calendar Year

80,000,000

Pound

518,081

14,200,000

Pound

9,638,649

(l) Imports for consumption at the quota rate are limited to 17,946,110 lbs. during
the first six months of the calendar year.

(continued)

TREASURY DEPARTMENT
212
Washington

MMEDIATE RELEASE,
Thursday, May 15. 1958.

A-240

The Bureau of Customs announced today preliminary figures showing the imports
for consumption of the commodities listed below within quota limitations from the
"beginning of the quota periods to May 3, 1958, inclusive, as follows:

Unit :
of : Imports as of
Quantity: May 3, 1958

Commodity

Tariff-Rate Quotas:
Cream, fresh or sour Calendar Year

1,500,000

Gallon

Whole milk, fresh or sour •••• Calendar Year 3,000,000 Gallon

Cattle, less than 200 lbs. each 12 mos. from 200,000
April 1, 1958

Head

4,729

Head

22,347

Cattle, 700 lbs. or more each Apr. 1, 1958 (other than dairy cows)
June 30, 1958

120,000

Fish, fresh or frozen, filleted,
etc., cod, haddock, hake,
pollock, cusk, and rosefish .. Calendar Year

35,892,221

Tuna fish • Calendar Year

44,693,874 Pound

White or Irish potatoes:
Certified seed
Other

114,000,000
12 mos. from
36,000,000
Sept. 15, 1957

Pound

Pound
Pound

Quota Filled^1
12,490,011

Quota Filled
Quota Filled

Walnuts „ Calendar Year

5,000,000 Pound

1,717,585

Almonds, shelled, blanched,. .,
roasted, or otherwise prepared Oct. 23, 1957 or preserved
Sept. 30, 1958

5,000,000 Pound

4,887,005

Alsike clover seed 12 mos. from
July 1, 1957

3,000,000 Pound

233,457

80,000,000

Pound

518,081

14,200,000

Pound

9,638,649

Peanut oil. 12 mos, from
July 1, 1957
Woolen fabrics Calendar Year

(l) Imports for consumption at the quota rate are limited to 17,946,110 lbs. during
the first six months of the calendar year.

(continued)

- 2-

Commodity

Period and Quantity

Unit
: " ~
" '
of
: Imports as of
Quantity: May 3, 1958

Absolute Quotas:
Peanuts, shelled, unshelled,
blanched, salted, prepared, or
preserved (incl. roasted pea- 12 mos. from
nuts but not peanut butter)... Aug. 1, 1957

1,709,000

Pound

Quota Filled

Pound
Pound

Quota Filled

1,200.,000

Pound

1,199,952

Feb. 1 - Oct* 31, 1958
Argentina
18,475,901
Paraguay
2,437,128
Other Countries
739,366

Pound
Pound
Pound

1>699,244*
Quota Filled
Quota Filled

12 mos. from
ye, *ye flour, and rye meal ••
July 1, 1957
Canada
182,280,000
Other Countries
3,720,000

Butter substitutes, including
butter oil, containing 45$
or more butterf at •...'....•..
Tung oil ............. •«<

f Imports as of May 13, 1958

Calendar Year

TREASURY DEPARTMENT
Washington

y > *>

A-241

IMMEDIATE RELEASE,
Thursday, May 15, 1958.

The Bureau of Customs announced today the following preliminary
figures showing the imports for consumption from January 1, 1958, to
May 3, 1958, inclusive, of commodities for which quotas were established pursuant to the Philippine Trade Agreement Revision Act of
1955:

Commodity
Buttons

Established Annual
Quota Quantity
807,500

Unit of : Imports as of
Quantity: May 3, 1958
Gross

175,346

Cigars 190,000,000 Number 1,279,188
Coconut oil 425,600,000 Pound 60,853,805
Cordage 6,000,000 Pound 1,465,610
(Refined 6,967,560
Sugars
(Unrefined ...

1,904,000,000

Tobacco 6,175,000 Pound 1,079,422

Pound
656,963,826

214
TREASURY DEPARTMENT
Washington
IMMEDIATE RELEASE,
Thursday, May 15, 1958.

A-241

Commodity

Quota Quantity

•
*

Imports as of
: Unit of s May 3, 1958
: Quantity:
•

Buttons

Coconut oil ......

(Refined
Sugars
(Unrefined ...
Tobacco ..........

807,500

•

Gross

175,346
1,279,188

190,000,000

Number

425,600,000

Pound

60,853,805

6,000,000

Pound

1,465,610

1,904,000,000

Pound

6,967,560
656,963,826
6,175,000

Pound

1,079,422

Hay 1* W t

mm^>nM'
torn following tmrnmUom were mad® In 4I*«* and guarantied """A*"
of ite e m n M B t AM- Treasury i a n i W t o « 4 other M O M S * during tha »«tt
of April, 195«*
gala* $21,773,^.00
Purchase .^Wt««
| 2,104,600.00

(Sgd) Charles 3f. Brannen
Chief, litvesteiantt Branch
Mvision of ©©posits & Xmttaasti

TREASURY DEPARTMENT

21&

WASHINGTON, D.C.

I
IMMEDIATE RELEASE,
Tuesday, April 15, 195

During Maron 195<3, market transactions
in direct and guaranteed securities of the
government for Treasury investment and other
s m /ev
accounts resulted in net ptt3ae4a&£££ by the
Treasury Department of $lQ,5tj)l.>i-0fr.00.

oOo

TREASURY DEPARTMENT
WASHINGTON, D.C.

IMMEDIATE RELEASE,
Thursday, May 15, 1958»

A-242

During April 1958, market transactions
in direct and guaranteed securities of the
government for Treasury investment and other
accounts resulted in net sales by the
Treasury Department of $2,104,600.

oOo

218
RELEASE A. K. NEWSPAPERS,
Tuesday, May 20, 1958.

*"*

i
/

The Treasury Bepartaent announced last evening that the tenders for |1,800,000,0C
or thereabouts, of 91-day Treasury bills to be dated Hay 22 and to mature August

which were offered on May 15, were opened at the Federal Beserve Banks on Kay 19.
The details of this issue are aa follows!
Total applied for - 12,503,958,000
Total accepted
- 1,800,311,000

(includes 1244,403,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bids-.
ligh - 99.110 Equivalent rate of discount approx. 0.910$ per annua
Low
- 99.161
•
n u n
n
o.945$ "

Average • 99.16$ « * » * • 0.931$ " "
(31 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

1
34,266,000
1,783,654,000
46,695,000
47,160,000
12,827,000
35,049,000
259,544,000
24,548,ooo
27,347,000
46,684,000
30,983,000
155,201,000

1
18,209,000
1,235,885,000
20,148,000
41,427,000
12,827,000
31,969,000
197,444,000
19,548,000
27,347,000
36,068,000
18,688,000

12,503,958,000

#1,800,311,000

TOTAL

NnTm

i4o,75i,ooo

TREASURY DEPARTMENT
WASHINGTON, D.C

SLEASE A. M. NEWSPAPERS,
tesday, May 20, 1958*

A-243

The Treasury Department announced last evening that the tenders for fl,800,000,000,

p thereabouts, of 91-day Treasury bills to be dated May 22 and to mature August 21
lich were offered on May 15, were opened at the Federal Reserve Banks on May 19.
The details of this issue are as follows?
Total applied for - $2,503,958,000
Total accepted
- 1,800,311,000

(includes $2kk9403,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bids?
High
Low

• 99.770 Equivalent rate of discount approx. 0*910$ per annum
B
w
- 99.761
«
«
«
n
0.945$ n

Average

- 99.765

0.931$

(31 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

$
34,266,000
1,783,654,000
46,695,000
47,160,000
12,827,000
35,049,000
259,544,000
24,548,000
27,347,000
1*6,684,000
30,983,000

i55,2oi,ooo

$
18,209,000
1,235,885,000
2O,lJ48,00O
41,427,000
12,827,000
31,969,000
197,44*1,000
19,548,000
27,347,000
36,068,000
18,688,000
140,751,000

$2,503,958,000

$1,800,311,000

TOTAL

-3-

or by any local taxing authority. For purposes of taxation the amount of discount
at which Treasury bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal Revenue Code of
1954 the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed of,
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 4l8, Revised, and this notice, prescribe
the tenns of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch,

- 2 -

2 percent of the face amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank or trust
company.
Immediately after the closing hour, tenders will be opened at the Federal Re-

final. Subject to these reservations, noncompetitive tenders for $200,000 or le

without stated price from any one bidder will be accepted in full at the averag

price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Re
serve Bank on May 29, 1958 , in cash or other immediately available funds

aBB"
or in a like face amount of Treasury bills maturing

May 29. 1958

• Cash

and exchange tenders will receive equal treatment. Cash adjustments will be mad

for differences between the par value of maturing bills accepted in exchange an
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

sale or other disposition of the bills, does not have any exemption, as such, a
loss from the sale or other disposition of Treasury bills does not have any
special treatment, as such, under the Internal Revenue Code of 1954. The bills

are subject to estate, inheritance, gift or other excise taxes, whether Federal

or State, but are exempt from all taxation now or hereafter imposed on the prin

or interest thereof by any State, or any of the possessions of the United State

;oo

jji^ L > Amm

E3J&XKXKX3C
TREASURY DEPARTMENT
Washington

.. / \
jL*Jj*

A.M.
R3K RELEASE/ MKKXK& NEWSPAPERS,
Thursday, May 22, 1958
•

cfcf

The Treasury Department, by this public notice, invites tenders for
$1,800,000,000 , or thereabouts, of 91 -day Treasury bills, for cash and

—W

in exchange for Treasury bills maturing
May 29, 1958
, in the amount of
$ 1,802,235,000 , to be issued on a discount basis under competitive and non-

-W—competitive bidding as hereinafter provided. The bills of this series will be
dated May 29, 1958 , and will mature August 28, 1958 , when the face

—

jgf

^ ~

—

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,0
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
closing hour,/ta® o'clock p.m., Eastern/Sfcunlaast time, Monday, May 26, 1958

Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1,000, and in the case of competitive tenders

the price offered must be expressed on the basis of 100, with not more than thre
decimals, e. g., 99*92$. Fractions may not be used. It is urged that tenders

be made on the printed forms and forwarded in the special envelopes which will b
supplied by Federal Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit tenders
except for their own account. Tenders will be received without deposit from

incorporated banks and trust companies and from responsible and recognized deal
in investment securities. Tenders from others must be accompanied by payment of

TREASURY DEPARTMENT

223

asi^a.'.'Kgaiweua^jsagajwsKgg'x?:

WASHINGTON, D.<
RELEASE A.M. NEWSPAPERS,
Thursday, May 22, 1958.

A-244

The Treasury Department, by this public notice, invites tenders
for $1,800,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing May 29, 1958,
in the amount of $l,80g,235,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated May 29, 1958,
and will mature August 28, 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, May 26, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
responsible and recognized dealers In investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
Those submitting tenders will be advised of
M n 0 . P 0 f accented bids.
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
In whole or in part, and his action in any such respect shall be
f?n«i
Sublect to these reservations, non-competitive tenders for
4?nn 000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders in accordance
with the bids must be made or completed at the Federal Reserve Bank
on May 29, 1958,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing May 29, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted In exchange and the issue price of the new
bills.
The Income derived from Treasury bills, whether Interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 195^-• ®ie bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter Imposed
on the principal or Interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be Interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder need Include in his Income tax return only the
difference between the price paid for such bills, whether on
original Issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their Issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.
0O0

RELEASE A. M. SWSPAPIRS,
Tuesday, May 27, 1958.
The Treasury Department announced last evening that the tenders for $1,000,000,001
w
n
m
y*x
z
Ca
or thereabouts, of 91-day Treasury bills %m be dated »ay 29 &nd to mature August 2®, l\
•'••*»v
i •"- of :'"
w
which were offered on May 22, were opened at the Federal Reserve Banks on May 26.
The details of this issue are as follows;
Total applied for - #2,383,446,000
Total accepted
- 1,800,025,000

(Includes $iyo,iau,uuu enterea on a
noncompetitive basis and accepted in
full at the average prise shown below) i

Range of accepted competitive bldst
High ~ 99.852 Equivalent rate of discount approx. Q.$M$% per annum
Low
-99.830
•
e n s
• „ . Q^l%%
• ?) of the
w
Average
-99.840
«
•
»
h • y -0.63531

«
»
?nal.
n
i&& »

(43 percent of the amount bid for at the low price was accepted)
,^ s i n g l y , the
Federal Reserve
District

Total
Applied for

Total £
Aeeepted

Boston
Hew fork
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

$
27,967,000
1,724,097,000
25,325,000
35,839,000
1,365,000
26,1*53,000
250,740,000
21,703,000
14,520,000
43,399,000
25,275,000
179,763,000

k ac u $1,208,677,000
17,967,000
10,325,000
30,839,000
* 8,365,000
»26,282,000
224,7^,000
16,703,000
lii, 420,000
37,669,000
24,275,000
179.763,000

12,383,446,000

$1,800,025,000

TOTAL

^4
*§mf

t/HtJ' :;

TREASURY DEPARTMENT

225

WASHINGTON, D.C.
BBLEaSE A. M. NEWSPAPERS,
Tuesday, May 27, 1958.

A-245

The Treasury Department announced last evening that the tenders for $1,800,000,000,

or thereabouts, of 91-day Treasury bills to be dated May 29 and to mature A

which were offered on May 22, vere opened at the Federal Reserve Banks on Ma
The details of this issue are as follows:
Total applied for - $2,383,446,000
Total accepted
- 1,800,025,000 (includes $190,410,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Range of accepted competitive bids;
High
Low

- 99.852 Equivalent rate of discount approx. 0.585$ per annum
H
- 99.830
"
«
M
«
«
0*673$ "

Average

-99.840

•

0.635$ "

•

(43 percent of the amount bid for at the low price was accepted)
Federal Reserve
District
Boston
New Tork
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

Total
Applied for
$ 27,967,000
1,724,097,000
25,325,000
35,839,000
8,365,000
26,453,000
250,740,000
21,703,000
14,520,000
43,399,000
25,275,000
179,763,000
TOTAL $2,383,446,000

Total
Accepted
$ 17,967,000
1,208 ,677,000
10,325,000
30,839,000
8,365,000
26,282,000
224,740,000
16,703,000
14,420,000
37,669,000
24,275,000
179 ,763,000
$1,800,025,000

-3-

or by any local taxing authority. For purposes of taxation the amount of discount
at which Treasury bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal Revenue Code of
1954 the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed of,
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 418, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch.

- 2 -

final. Subject to these reservations, noncompetitive tenders for $200,000 or le

without stated price from any one bidder will be accepted in full at the averag

price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Re
serve Bank on June 5, 1958 , in cash or other immediately available funds
or in a like face amount of Treasury bills maturing June 5. 1956 • Cash

ISBt

and exchange tenders will receive equal treatment. Cash adjustments will be made
for differences between the par value of maturing bills accepted in exchange an
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

are subject to estate, inheritance, gift or other excise taxes, whether Federal

or State, but are exempt from all taxation now or hereafter imposed on the prin

or interest thereof by any State, or any of the possessions of the United State

TREASURY DEPARTMENT
Washington

J
/JL
*s^r '

A. M.
X8R RELEASE/ XBXKXK& NEWSPAPERS,
Wednesday. May 281 1958
.

/ ^ [jjO
L
y

The Treasury Department, by this public notice, invites tenders for
$1,800,000,000

, or thereabouts, of

—W—

-day Treasury bills, for cash and

in exchange for Treasury bills maturing
Ttmg s 1958
, i n ^he amount of
$1,800,147,000 , to be issued on a discount basis funder competitive and non-

—w—
competitive bidding as hereinafter provided. The bills of this series will be
dated
June 5. 1958
, and will mature
September 4. 1958 , when the face
amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
closing hour, y^ooco*clock p.m., Eastern/§aSB3EQ0t time, Monday, June 2, 1958
—

—

Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1,000, and in the case of competitive tenders
the price offered must be expressed on the basis of 100, with not more than three
decimals, e. g., 99.925. Fractions may not be used.

It is urged that tenders

TREASURY DEPART

:jitj»ii^svi^.%imi<ai!A^atSMaawey

WASHINGTON, D
RELEASE A.M. NEWSPAPERS,
Wednesday, May 28, 1958.

A-246

The Treasury Department, by this public notice, Invites tenders
for $1,800,000,000, or thereabouts, of 91-day Treasury bills, for
cash and In exchange for Treasury bills maturing June 5, 1958,
In the amount of $1,800,147,000, to be Issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated June 5, 1958,
and will mature September 4, 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, .$5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, June 2, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e.g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from Incorporated banks and trust companies and from
responsible and recognized dealers In investment securities
Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied, for, unless the ^nders are
accompanied by an express guaranty of payment by an incorporated bank
"or trust company.
Immediately after the closing hour, tenders will £ |f ^uSL?"
Federal Reserve Banks and Branches, following which public announce
ment will be made by the Treasury Department of the amount and prlce
!!!L «f a^pcted bids
Those submitting tenders will be advised oi
g
th2 «o£Ltance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
. expressj.y
? * Q~+ anrj hi <* action in anv such respect shall be
^ " f ^ J e c ^ f i h e s e reservations? noncompetitive tenders for
ion% noo or less without stated price from any one bidder will be
fccep?ed in full at the average price (in three decimal,) 01 accepted

- 2 competitive bids. Settlement for accepted tenders In accordance
with the bids must be made or completed at the Federal Reserve Bank
on June 5, 1958,
In cash or other Immediately available funds
or In a like face amount of Treasury bills maturing June 5, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether Interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 195^» The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter Imposed
on the principal or Interest thereof by any State, or any of the
possessions of the United States, or hy any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
Issued hereunder need Include in his Income tax return only the
difference between the price paid for such bills, whether on
original issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No0 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

oOo

TREASURY DEPARTMENT
WASHINGTON, D.C.
IMMEDIATE RELEASE,
Thursday, May 29, 1958.

A-247

The Treasury Department announced today that on Wednesday, June 4, the subscription books will be opened for three days for the refunding of the three issues due
for payment on June 15. The new securities offered will be a 1-1/4$ 11-month certificate of indebtedness and a 2-5/8$ 6-year 8-month Treasury bond due February 15,
1965, both to be dated June 15, 1958.
The securities eligible for exchange are:
2-7/8$ Treasury notes, in the amount of $4,392 million
2-3/4$ Treasury bonds, in the amount of $919 million
2-3/8$ Treasury bonds, in the amount of $4,245 million
All exchanges will be made par for par. Any exchange subscription for either issue
addressed to a Federal Reserve Bank or Branch, or to the Treasurer of the United
States, and placed in the mail before midnight June 6, will be considered as timely.
In addition, on Tuesday, June 3, it will offer for cash subscription at a price
of 100-1/2 an issue of $1 billion, or thereabouts, of 3-1/4$ 26-year 11-month Treasury Bonds, to be dated June 3, 1958, and to mature May 15, 1985. In addition, up
to $100 million of the bonds may be allotted to Government Investment Accounts. The
subscription books will be open only on June 3 for this offering. Any cash subscription addressed to a Federal Reserve Bank or Branch, or to the Treasurer of the United
States, and placed in the mail before midnight June 3, will be considered as timely.
Subscriptions for the cash offering of bonds from commercial banks, which for
this purpose are defined as banks accepting demand deposits, for their own account
will be restricted in each case to an amount not exceeding 2$ of the combined amount
of time certificates of deposit (but only those issued in the names of individuals,
and of corporations, associations, and other organizations not operated for profit),
and of savings deposits, or 5$ of the combined capital, surplus and undivided profits,
whichever is greater, of the subscribing bank. A payment of 20$ of the amount of
bonds subscribed for must be made on all subscriptions, including those from commercial
banks for their own account, and this payment must be forwarded with the subscriptions
in Immediately available funds, or by credit in the Treasury Tax and Loan Account of
the bank through which the subscription is entered, to the Federal Reserve Bank or
Branch, or to the Office of the Treasurer of the United States. Following allotment,
any portion of the 20$ payment in excess of the amount of bonds allotted will be
returned to the subscribers. The remaining
bonds allotted must be paid
for on June 18, the delivery date, together with accrued interest at the rate of
$0,089 per day per $1,000 from June 3, which is the date from which the new bonds
will bear interest, to June 18, the payment date. The bonds may be paid for by
credit in Treasury Tax and-Loan Accounts.
Commercial banks and other lenders are requested to refrain from making unsecured
loans and loans collateralized in whole or in part by the bonds * subscribed for, to
cover the 20$ deposits .required to be paid when subscriptions are entered.
The Treasury announced that cash subscriptions will be subject to the usual
reservation of the right to make different percentage allotments to various classes
of subscribers.

RELEASE A. «, HEWSPAPESS,
Tuesday, June 3, 1958.
The Treasury Department announced last evening that the tenders for 11,800,000,000,
or thereabouts, of ?l-day treasury bills to be dated June $ mod to mature September k9
1958, which were offered on May 28, were opened at the Federal Reserve Banks on June 2.
The details of this issue are a® followst
Total applied for - I2,kl5,3i*2,©00
total accepted
- 1,800,597,000

(include® f&67,283,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

lange of accepted competitive bidss
Hi# - 99.81*0 Equivalent rate of discount approx. 0.633$ per annum
Low
- 99.810
*
n
*
*
«

0.752$ "

Average - 99.817 » « » « * 0.723$ * *
(33 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
Hew York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

1
35,509,000
1,81*7,852,000
2lif311,000
3l*,665,000
7,612,000
26,073,000
217,057,000
21,1*70,000
lli,l8ij,000
¥*,350,000
21,936,000
120,323*000

t
25,509,000
1,311,002,000
9,311,000
30,615,000
7,612,000
26,073,000
180,387,000
21,1*70,000
li*,l8i*,000
39,680,000
21,936,000
112.788,000

f2,ia5#3k2,0OO

11,800,597,000

TOTAL

TREASURY DEPARTMENT 222.
WASHINGTON, D.C.
RELEASE A. M. NEWSPAPERS,
Tuesday, June 3, 1958*

A-2U8

The Treasury Department announced last evening that the tenders for $1,800,000,000,

or thereabouts, of 91-day Treasury bills to be dated June $ and to mature Septembe

1958, which were offered on May 28, were opened at the Federal Reserve Banks on Ju
The details of this issue are as follows s
Total applied for - $2,kXS931*2,000
Total accepted
- 1,800,597,000

(includes $167,283,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bidss
High
Low

- 99.81*0 Equivalent rate of discount approx. 0.633$ per annum
w
- 99.810
»
n
n
M
«
0.752$ w

Average

- 99.817

0-723$

(33 percent of the amount bid for at the low price was accepted)

Federal Reserve
District
_^

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

4
35,509,000
1,8&7,852,00Q
2l*,311,000
3u,665,0Q0
7,612,000
26,073,000
217,057,000
21,1*70,000
ll*,l81*,000
1*1*,350,000
21,936,000
120,323,000

•
25,509,000
1,311,002,000
9,311,000
30,61*5,000
7,612,000
26,073,000
180,387,000
21,1*70,000
H*,l81*,000
39,680,000
21,936,000
112,788,000

12,1*15,31*2,000

H,80O,597,00O

TOTAL

IMMEDIATE RELEASE,
Tuesday June 3, 195®»

/.... y

The Bureau of Customs announced today that the quotas
on Canadian wheat and wheat flour prescribed in the President's
Proclamation of May 28, 19^1, as modified, were filled at the
opening moment of the quota year, 12:00 noon, e.s.t., on
May 29, 1958.

TREASURY DEPARTMENT 234
WASHINGTON, D.C.

IMMEDIATE RELEASE,
Tuesday, June 3, 1958.

A-249

The Bureau of Customs announced today
that the quotas on Canadian wheat and wheat
flour prescribed in the President's
Proclamation of May 28, 19^1, as modified,
were filled at the opening moment of the
quota year, 12:00 noon, e.s.t., on May 29,
1958.

oOo

-39. T TUT fl

,-/

or by any local taxing authority. For purposes of taxation the amount of discount
at which Treasury bills are originally sold by the United States is considered to
be interest. Under Sections h$k (b) and 1221 (5) of the Internal Revenue Code of
195b the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed of,
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 1*18, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch«

final. Subject to these reservations, noncompetitive tenders for $200,000 or le

without stated price from any one bidder will be accepted in full at the averag

price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Re
serve Bank on June 12, 1958 , in cash or other immediately available funds
or in a like face amount of Treasury bills maturing June 12, 1958 . Cash

and exchange tenders will receive equal treatment. Cash adjustments will be mad

for differences between the par value of maturing bills accepted in exchange an
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

sale or other disposition of the bills, does not have any exemption, as such, a
loss from the sale or other disposition of Treasury bills does not have any

special treatment, as such, under the Internal Revenue Code of 1951*. The bills

are subject to estate, inheritance, gift or other excise taxes, whether Federal

or State, but are exempt from all taxation now or hereafter imposed on the prin

or interest thereof by any State, or any of the possessions of the United State

TREASURY DEPARTMENT
Washington
A. M.
ECB RELEASEj/S^^g^ NEWSPAPERS,
Thursday> June 5, 1958

\
j_ \
/ >

The Treasury Department, by this public notice, invites tenders for
$1,700,000,000 % or thereabouts, of 91 -day Treasury bills, for cash and

— W

iak

in exchange for Treasury bills maturing

June 12, 1958

, in the amount of

WE
$ 1,699,839,000 , to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. The bills of this series will be
dated June 12, 1958 , and will mature September 11. 1958 , when the face

amount will be payable without interest. They will be issued in bearer form onl

and in denominations of $1,000, $5,000, |10,000, $100,000, $500,000 and $1,000,0
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Bayligbt Saving
closing hour, f&SG~ o'clock p.m., Eastern Sbaarabaric time, Monday. June 9, 1958

Tenders will not be received at the Treasury Department, Washington. Each tende
must be for an even multiple of $1,000, and in the case of competitive tenders

incorporated banks and trust companies and from responsible and recognized dea

in investment securities. Tenders from others must be accompanied by payment of

TREASURY DEPARTMENT
WASHINGTON, D.C.
RELEASE A.M. NEWSPAPERS,
Thursday, June 5, 1958.

A-250

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing June 12, 1958,
in the amount of $1,699,839,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated June 12, 1958,
and will mature September 11, 1958, when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, June 9, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from Incorporated banks and trust companies and from
responsible and recognized dealers In investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or In part, and his action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
$200 000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2
competitive bids. Settlement for accepted tenders in accordance
with the bids must be made or completed at the Federal Reserve Banli
on June 12, 1958,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing June 12, 1958,
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954. The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter Imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections k$k (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills Issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder need Include In his Income tax return only the
difference between the price paid for such bills, whether on
original Issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the.
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

oOo

< 3s /I -.} *. I

mi?:yjzc, tm*mm9
*Ebe fmi»*rr toiar w m @ i * ho

^mmmm «U*lM«fc +* m^m*m*%ym investor

*br1*»ir o n « M H M * I anH a > J " pr.

a l i ^ ^ x to #11 otte,artmrt^;,4tor tht mrm^m*h

hmtim

'm* #1 bSUHsii,

or.tterotfbcnita, of 3*1/ft 9a*rt»fc fernou? 3 « # of IMS. M w v l i f t J m < * * § / * *
or U M 'win t» kliiitii'li' ifwx. '-i&MvtioiM;' « w *w» «fci«' $j£®f£ will j»
*n®l*«s€ not 3 M O tba» ijfjpgg. in i g ^ t a to ifeo o@ra^ «U*tt«*-*o tlw 2N&U®*
4
£ « ioc have
HOD MtUUtt «f ttimftonftintSXA b# &3Uotfco& t® Ommmmmm l^vostiwat M m » U . on

mfee.,3Wo«*'*U«fc»

...

„

<•

mm m mximmt

•

«•

mlkmmX -mmXmm mmmk*t mviags'^d 'imm tmm^i*Mimmi

and iota ootoeiatfottfti ««i»i^ivo taskii oriftlt uataM*

teifim

„

bmMm

<M*piaJ«»

profit slmrin- ant wtiwswwt ftadf - *t«to out loeal, «o*^emtj ffcofeuml bmmtit
mmmim&imm

art Uter V B I O U fbr flpMr l a a m M a ftaittil^aaiM* t a t *

tmA»9am&A

ofrtKeaftlooal,®lite@«»ry lastitutlo.ns and otter n«m-profit

te9« b o m gfrraa a i>^fer^ti^l al&ofeMMrt &i « M p f « i vitli
otter ©lease® of TObseribors, ^fcter ttaaa aavlaat^jya ltmatari/1 tomur "of W i i « t
that <«olMlftxtotSea* t i l * w i m M
restricts to a lot? ^mmmm

b«8t® aould mi&sit for tlt&lr @ n ,-ee^unt' w r e

mt Wmir mwinm

d^osite or m&ttmi .f\nto. whereas

... of
ffcr ftoBB tfeft
*****& «^«^* '?i£Z£ ailiion, of A M i $ $ f o i t t U w w r o awoivod from aufeacribofi
ia tte mviagii-t^® isvwtor ^ o ^ , $ ^ 3 o ailliesa from oowioBsioa. banks fbr ttoir
o m «©eo*i»t, mm $,/>><0 aS31i«i froo o U otbor«* XMbojLU lv IWnrol Bo»«r*o JE»*
trieto as to •tiNNnriyfcfcNft oai a30olMaio w i U bo a t m n ^ i I « M B f » M l npovlMi *r«
received from tlse f^deml

TREASURY DEPARTMENT
WASHINGTON, D.C.
IMMEDIATE REIxSASE,
Thursday, June 5, 1958.

A-251

The Treasury today announced a 60 percent allotment to savings
type investors, a 40 percent allotment to commercial banks for
their own account, and a 25 percent allotment to all other
subscribers for the current cash offering of $1 billion, or thereabouts, of 3-1/4 percent Treasury Bonds of 1985. Subscriptions
for $5?000 or less will be allotted in full. Subscriptions for
more than $5,000 will be allotted not less than $5,000. In
addition to the amount allotted to the public, $100 million of
these bonds will be allotted to Government Investment Accounts.
The savings-type investors whose subscriptions are given a
60 percent allotment are as follows: mutual savings banks;
savings and loan associations; building and loan associations;
cooperative banks; credit unions; Insurance companies; pension,
profit sharing and retirement funds - state and local, corporate;
fraternal benefit associations and labor unions for their insurance
funds; common trust funds, and endowment funds of educational,
eleemosynary institutions and other non-profit organizations.
Commercial banks have been given a preferential allotment as
compared with other classes of subscribers, other than savingstype investors, In view of the fact that subscriptions which
commercial banks could submit for their own account were restricted
to a low percentage of their savings deposits or capital funds,
whereas no limitation was placed on other classes of subscribers.
Reports received thus far from the Federal Reserve Banks show
that subscriptions total about $2,570 million, of which $860
million were received from subscribers in the savings-type investor
groups, $530 million from commercial banks for their own account,
and $1,180 million from all others. Details by Federal Reserve
Districts as to subscriptions and allotments will be announced
when final reports are received from the Federal Reserve Banks.

oOo

<:4l

f\
\*s

RELEASE A. M. MEWSPAPIIS,
Tuesday, June 10, I9$8.

The Treasury Department announced last evening that the tenders for 11,700,000,000
or thereabouts, of 91-day Treasury bill® to be dated June 12 and to mature September 11
1958, which were offered on June 5, were opened at the Federal Reserve Banks on June 9.
The details of this issue are as follows:
Total applied for * 12,1149,916,000
Total accepted
- 1,700,172,000

(includes $237,109,000 entered on a
noncompetitive basis and accepted in
f u H at the average price shown below)
Hange of accepted competitive bids? (^accepting 3 tenders totaling #4,390,000)
Higfr - 99.803 Iijuivalent rate of discount approx. 0.7791 per anus
low
- 99.782
"
t« • «
«
H

Q.862£

Average - 99.787 fi w ,} *;" n O.LSla.% " «
(92 percent of the amount bid for at the low price was accepted)
Federal leserve
District

Total
Applied for

Total
Accepted

Boston
Mew York
Philadelphia
Cleveland
Biehwosd
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Ballas
San Francisco

11,601,000
1*6,738,000
226,939,000
20,581,000
12,11*0,000
61*,600,000
21,169,000
129,57*1*000

1 3*1,500,000
1,1314,2814,000
26,216,000
li5,67li,000
11,601,000
l$6,7ll*,000
178,859,000
20,581,000
12,11*0,000
514,360,000
21,169,000
lll4,07l*,000

I2,iili9,9l6,000

$1,700,172,000

1^,500,000

i»79S,i@l*,ooo
31,216,000

U5,67U,ooo

TOTAL

TREASURY DEPARTMENT

1'42

WASHINGTON, D.C.
RELEASE A. M. NEWSPAPERS,
ruesday, June 10, 1958.

A-252

The Treasury Department announced last evening that the tenders for $1,700,000,000,

or thereabouts, of 91-day Treasury bills to be dated June 12 and to nature Septembe

1958, which were offered on June 5, were opened at the Federal Reserve Banks on Jun
. The details of this issue are as follows:
Total applied for - $2,l*U9,9l6,000
Total accepted
- 1,700,172,000

(includes $237,109,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bids; (Excepting 3 tenders totaling $U,390,000)
High - 99.803 Equivalent rate of discount approx. 0.779$ per annum
- 99.782
«
m o m
»
0.862$ «
L ow
Average - 99.787

w tt H

«l * °*8^

n tt

(92 percent of the amount bid for at the low price was accepted)

Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

1,795,18U,000
31,216,000
l*5,67lt,000
11,601,000
1*6,738,000
226,939,000
20,581,000
12,11*0,000
61*,600,00O
21,169,000
129,57*1,000

$
3U,500,000
1,131*,281*,000
26,216,000
l*5,67l+,000
11,601,000
l*6,?ll*,00Q
178,859,000
20,581,000
12,11*0,000
51*, 360,000
21,169,000
lll*,07i4,0OO

$2,1*1*9,916,000

$1,700,172,000

TOTAL

l*i*,5oo,ooo

TREASURY
?r

c.K

DEPARTMENT

W A S H INGTQM. OJC«

^s>-*

»88<InJL<U o*sa& ^ipa&aeiJf
BftflBDXASE R m & S i ,
i^e^^-^^^o fto4^1M ^ 0 t C ^ .tinxC* &®*lt nods «ru*tt xwsOt&%£mW
%£X>XHim

®B&%*4 mA$*W*m*
iv&riuo arid nX bmlmzl
mmml
%mX&*^tm
Preliminary figures ALOW tfc*i *Uait . . ""$ mxt
~. s^ *'* .*&iods o&toloMl mws&ioM
.mmmX w#c ©wt mM rsdt im^mtiom *xsw3 mml
issues involved in UMI en
^ftoilng, »^r*§*t1-^ <- >
r,i^^
&oa ^aodwoJbtldhxootoxa-xi*i\l-f Mteo®*IX won && voft aolH-Cis S8YtX$
have been easebaa^ed for *.fc*» tuo at* l*Wtf*
s?»-.^m§M i-u.e^-t &r*v.~
••Jbootf t ^ « « « ^ tl^ofOf *\e-8 rftaN** ,"o#snc«a 00* *ft isoliXtJS oeStTl
$1,785 million for th* m?** Xl-r^^- l-i./4 p*;\j**« > ^--..ifieoto*, aud
dm® tdk aJkosm mmmmk m&&@*$m#®o *W" to oo&UJta OSdf toocU
$7,250 millios for tfao 6*yeor, Q^mryjx S-5/8
2*
po*wet Sroor^y 1 *****
*8X ®asrL iso ooitf
About ;'. '". ml II ion ©f tho outstanding Issues reseda tor casb r®d«|i«
<xe&£ booauuoojcES Otf ILrr S^SBIIOXS « & satitaasst?ftouqtlftJjmiM
tlon ©n June IS*
,atoS sprx^ail Jtaofto? orf* wnft hmriomi m* ®frtoqm XoaJft
F t a a figure* regardl&g tho me&mm
viiJL so t^^r.-xrM *ft*r
final reports ar© received ?ro» too J*d**tX T^#r««< ^.j*.*.

24J A f ?3' ^
BMEDIM1!- RELEASE,
Itaesday, June 10, 1S5S.
Preliminary figures snow that about $9,035 million of the three
issues involved in too current refunding, aggregating $9,555 million,
have been exchanged for the tm new issues. Exchanges include about
#1,7$S million for the new U^saoata 1-1/4 percent certificates, and
|7,ES0 million for the ®*year, 8»montb 2-5/8 pereeat Trmmmmry bonds.
About $520 million of the outstanding issue* remain for cash redemption on June IS.
Final figures regarding the exchange will be announced after
final reports are received from the Federal Reserve Book*.

TREASURY DEPARTMENT

f/1

—

WASHINGTO!*.!}^.
N^T
IMMEDIATE RELEASE,
Tuesday, June 10, 1958.
A-253
Preliminary figures show that about $9,035* million of the three
issues involved in the current refunding, aggregating $9,555 million,
have been exchanged for the two new issues. Exchanges include about
$1,785 million for the new 11-month 1-1/4 percent certificates, and
$7,250 million for the 6-year, 8-month 2-5/8 percent Treasury bonds.
About $520 million of the outstanding issues remain for cash redemption on June 16.
Final figures regarding the exchange will be announced after
final reports are received from the Federal Reserve Banks.

245

BfcffiDJJTE RELEASE,
Tuesday, June 10, 1958.

The Treasury Department today announced the subscription and allotment figures with
respect to the cash offering of $1 billion, or thereabouts, of 3-1/4 percent Treasury
-loads of 1985, dated to® 3, 1958, and maturing my IS, 1985. Subscriptions from saving
type investors were allotted SO percent, subscriptions from commercial banks for their oi
account were allotted 40 percent, and all other subscriptions were allotted 25 percent.
Subscriptions for $5,000 or less were allotted ia full. Subscriptions for more than $5,1
were allotted not less than $5,000. la addition, $100 million were allotted to Governor
Investment Accounts*
Subscriptions and allotments were divided among the several federal Reserve Distrid
and the Treasury as follows i
Total
Subscriptions
Subscriptions
from coml* banks Subscription®
Subscriptions
Federal Reserve
from savingsReceived
from all others
type investors
for own account
District
Boston
Hew Tork
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Hinneapolis
Kansas City
Dallas
San Francisco
Treasury
fetal

$103,990,500
328,201,500
17,868,500
48,285,500
60,884,000
19,276,000
85,774,000
13,628,500
28,182,000
13,304,000
31,283,000
108,417,000
633,000

$ 18,587,000
191,487,500
25,916,500
18,270,000
14,085,500
23,315,000
99,190,000
18,787,000
12,300,000
14,395,000
23,530,500
74,700,500

$859,867,500

$532,124,500

22,672,000
785,955,000
13,533,000
35,086,000
23,803,50)
38,952,500
104,040,000
28,030,000
7,327,000
8,702,500
68,422,500
41,444,000
40*500

$1,177,808,500

Federal Reserve
District

Total
Allotments

Boston
lew York
Hiiladeli^*A
Cleveland
Richmond
Atlanta
Chicago
8t. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Treasury
Govt. Dav. Acets.

Total

75,088,000
474,392,000
24,703,500
44,396,000
48,422,500
31,840,000
118,440,500
23,905,000
23,772,500
16,280,500
45,608,500
105,673,000
406,500
100,000,000

$1,152,908,500

$ 143,249,500
1,305,624,000
87,318,000,
101,S21,5W
98,553,000
81,543,500
289,004,000
60,425,500
47,809,000
36,201,801
123,016,000
224,561,500
673,500
$2,569,600,500

TREASURY DEPARTMENT
WASHINGTON, D.C.
^MEDIATE RELEASE,
lesday, June 10, 1958.

A-254

The Treasury Department today announced the subscription and allotment figures with
espect to the cash offering of $1 billion, or thereabouts, of 3-1/4 percent Treasury
Dnds of 1985, dated June 3, 1958, and maturing May 15, 1985. Subscriptions from savingsype investors were allotted 60 percent, subscriptions from commercial banks for their own
ccount were allotted 40 percent, and all other subscriptions were allotted 25 percent.
inscriptions for $5,000 or less were allotted in full. Subscriptions for more than $5,00C
ere allotted not less than $5,000. In addition, $100 million were allotted to Government
nvestment Accounts.

Subscriptions and allotments were divided among the several Federal Reserve Distric
ad the Treasury as follows:
'

ederal Reserve
istrict
oston
ev York
oiladelphia
leveland
Ichmond
tlanta
hicago
t. Louis
inneapolis
ansas City
alia3
an Francisco
reasury
Total

Subscriptions
from savingstype investors

Subscriptions
from coml. banks
for own account

$103,990,500
328,201,500
17,868,500
48,265,500
60,864,000
19,276,000
85,774,000
13,628,500
28,182,000
13,304,000
31,263,000
108,417,000
633,000

$ 16,587,000
191,467,500
25,916,500
18,270,000
14,085,500
23,315,000
99,190,000
18,767,000
12,300,000
14,195,000
23,330,500
74,700,500

$859,667,500

$532,124,500

„

Subscriptions
from all others
22,672,000
785,955,000
13,533,000
35,086,000
23,603,500
38,952,500
104,040,000
28,030,000
7,327,000
8,702,500
68,422,500
41,444,000
40,500

$ 143,249,500
1,305,624,000
57,318,000
101,621,500
98,553,000
81,543,500
289,004,000
60,425,500
47,809,000
36,201,500
123,016,000
224,561,500
673,500

$1,177,808,500

$2,569,600,500

Federal Reserve
District

Total
Allotments

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Treasury
Govt. Ihv. Accts.

Total

Total
Subscriptions
Received

75,068,000
474,392,000
24,703,500
44,396,000
48,422,500
31,840,000
118,440,500
23,905,000
23,772,500
18,280,500
45,608,500
105,673,000
406,500
100,000,000

$1,132,908,500

- 3 -

or by any local taxing authority.

For purposes of taxation the amount of discount

at which Treasury bills are originally sold by the United States is considered to
be interest. Under Sections \\$k (b) and 1221 (5) of the Internal Revenue Code of
1951 the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed of,
and such bills are excluded from consideration as capital assets. Accordingly,
the owner of Treasury bills (other than life insurance companies) issued hereunder
need include in his income tax return only the difference between the price paid
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 1*18, Revised, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue. Copies
of the circular may be obtained from any Federal Reserve Bank or Branch.

- 2 -

final. Subject to these reservations, noncompetitive tenders for $200,000 or le

without stated price from any one bidder will be accepted in full at the averag

price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Re
serve Bank on June 19, 1958 , in cash or other immediately available funds
or in a like face amount of Treasury bills maturing June 19, 1958 . Cash

and exchange tenders will receive equal treatment. Cash adjustments will be mad

for differences between the par value of maturing bills accepted in exchange an
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

sale or other disposition of the bills, does not have any exemption, as such, an
loss from the sale or other disposition of Treasury bills does not have any
special treatment, as such, under the Internal Revenue Code of 195u. The bills
are subject to estate, inheritance, gift or other excise taxes, whether Federal

or State, but are exempt from all taxation now or hereafter imposed on the prin

or interest thereof by any State, or any of the possessions of the United States

<- A O

WffifflMIX
TREASURY DEPARTMENT
Washington
A. M.
Mm
RELEASE/ MBKHXi® NEWSPAPERS,
Thursday, June 12, 1958
.

The Treasury Department, by this public notice, invites tenders for
$ 1,700,000,000 , or thereabouts, of

-day Treasury bills, for cash and

""135

in exchange for Treasury bills maturing

June 19, 1958

, in the amount of

SET
$ 1,699,678,000 , to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. The bills of this series will be
dated

June 19, 1958

, and will mature

September 18, 1958

, when the face

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,000
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
closing hour, tea/o'clock p.m., Eastern SfcXHttSl/'time,
Monday, June 16, 1958
Tenders will not be received at the Treasury Department, Washington.

Each tender

must be for an even multiple of $1,000, and in the case of competitive tenders
the price offered must be expressed on the basis of 100, with not more than three
decimals, e. g., 99*92$.

Fractions may not be used.

It is urged that tenders

Tenders will be received without deposit from

incorporated banks and trust companies and from responsible and recognized dealers
in investment securities.

Tenders from others must be accompanied by payment of

TREASURY DEPARTMENT

°U

SEE'iaWfcSCU* SRiiiiSEiJK W S O T X v 3 ^

WASHINGTON, D.C
RELEASE A.M. NEWSPAPERS,
Thursday, June 12, 1958.
A^SA^SSS1^

A-255

Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing June 19, 1958,
in the amount of $1,699,678,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated June 19, 1958,
and will mature September 18, 1958, when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, June 16, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from Incorporated banks and trust companies and from
responsible and recognized dealers In investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
range of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
expressly reserves the right to accept or reject any or all tenders
in whole or In part, and his action in any such respect shall be
final. Subject to these reservations, non-competitive tenders for
$200 000 or less without stated price from any one bidder will be
accepted in full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders in accordance
with the bids must be made or completed at the Federal Reserve Bank
on June 19, 1958,
in cash or other immediately available funds
or in a like face amount of Treasury bills maturing June 19, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether Interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954* The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter Imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder.need Include In his income tax return only the
difference between the price paid for such bills, whether on
original issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their Issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

oOo

251
UNITED STATES MMETKRY GQUHrMNSAmOlS'lffTH FOREIGN'eCftftnicrES''
January l, 1958 - mrch 3h 'ISM
<*» ^Hlign£jl^fetl»rs at $)$ per fine mmml , , i,,
Negative figures represent net sales by the/
Uftfted States; postfive fibres, net W r c h i m
First Quarter
&****<!{

,„

-,., _

-_>»*, - - ^

tank for- International Settlements * .„ .*.»...<•*•«. - U S . I

tetgW
Iran

-14.2

...

*.3
-.3

Netherlands . . . . . . . . . . . . . . . . . .
Switzerland . . . .

-M.f»§.Q

Tunisia ............ mtk
Halted Kingdom .#..*.. * . .• *'
Other

. . . . *.*,-. . . .'"'» . . . . . . .

Tata!

-300.0
".2

*!**•£

H rU-UmUjt'*/\

The Treasury &epert*i»ent today made public a
report''bf monetary gold transactions with foreign
governments, central banks and International fnstftw
ttons for the first quarter of 1958. The net outflow
of Monetary gold from the UmHmd States In this period
amounted to $3??.4 million.
A table showing net transactions, by country,
for the first q«arter of 195B Is attached.

TREASURY D E P A R T M E N T

253

WASHINGTON, D.C.

RELEASE A.M. NEWSPAPERS,
Thursday, June 12, 1958.

A-25o

The Treasury Department today made public a
report of monetary gold transactions with foreign
governments, central banks and international institutions for the first quarter of iy58. The net outflow
of monetary gold from the United States in this period
amounted to $377.4 mi 11 ion.
A table showing net transactions, by country,
for the first quarter of 1958 is attached.

UNITED STATES MONETARY GOLD TRANSACTIONS WITH FOREIGN COUNTRIES
January 1, 1953 - March 31, 1958
(in millions of dollars at $35 per fine ounce)
Negative figures represent net sales by the
United States; positive figures, net purcbases__
Country

__„

_™___™„__,„_

First Quarter
L25IL-™---,

Bank for International Settlements ... -$15.1
Belgium .. -14.2
Iran -.3

Japan -.3
Netherlands -41.9
Switzerland -5.0

Tunisia -.4
United Kingdom ., -300.0
Other -.2

Total

-$377.4

- 2•y

Unit
:
of
: Imports as of
Quantity: May 31, 1958

Commodity

Absolute Quotas:
Peanuts, shelled, unshelled,
blanched, salted, prepared, or
preserved (incl. roasted pea- u 12 mos. from
nuts but not peanut butter) ... Aug^ 1, 1957
Rye, rye flour, and rye meal

Butter substitutes, including
butter oil, containing 45^
or more butterf at
,
Tung oil

1,709,000

Pound

Quota filled

12 mos. from
July 1, 1957
Canada
182,280,000
Other Countries 3,720,000

Pound
Pound

Quota filled

Calendar Year

1,200,000

Pound

1,199,952

Feb. 1 - Oct. 31, I958
Argentina
18,475,901
Paraguay
2,437,128
Other Countries
739,366

Pound
Pound
Pound

Quota filled
Quota filled
Quota filled

TREASURY DEPARTMENT
Washington

IMMEDIATE RELEASE
Thursday, June 12. 1Q58.

y w

A-

Unit :
of
: Imports as of
Quantity: May31,. 1958

Commodity

Tariff-Rate Quotas:

1,500,000

Gallon

Calendar Year 3,000,000
Whole milk, fresh or sour ......

Gallon

Cattle, less than 200 lbs. each
12 mos. from
April 1, 1958

200,000

Head

9,456

Cattle, 700 lbs. or more each
(other than dairy cows)

120,000

Head

34,098

Cream, fresh or sour •

Calendar Year

April 1, 1958 June 30, 1958

Fish, fresh or frozen,TFilleted,
etc., cod, haddock, hake,
pollock, cusk, and rosefish ... Calendar Year

35,^92,221

Pound

Quota Filled'1)

Tuna fish Calendar Year 44,693,874

Pound 16,035,^01

White or Irish potatoes:
Certified seed
Other

Pound
Pound

12 mos. from 114,000,000
Sept. 15, 1957 36,000,000

Quota Filled
Quota Filled

Walnuts I Calendar Year 5,000,000

Pound 1,971,356

Almonds, shelled, blanced,
roasted, or otherwise prepared Oct. 23, 1957 or preserved
.. Sept.1 30, 1958 5,000,000

Pound

Alsike clover seed 12 mos. from
July 1, 1957

Pound 233,697

3,000,000

4,900,217

Peanut oil • 12 mos. from
July 1, 1957
Woolen fabrics Calendar Year 14,200,000

80,000,000

Pound 2,050,459
Pound 11,562,902

(l) Imports for consumption at the quota rate are limited to 17,946,110 lbs. during
the first six months of the calendar year.
(continued)

TREASURY DEPARTMENT
Washington

IMMEDIATE RELEASE

Thursday, June IP. 795ft

n r-

£2

The Bureau of Customs announced today preliminary figures showing the impor
for consumption of the commodities listed below within quota limitations from the
beginning of the quota periods to May 31, 1958, inclusive, as follows:
Unit :
of
: Imports as of
Quantity: May 31, 1958

Commodity
Tariff-Rate Quotas:
Cream, fresh or sour ,

Calendar Year

1,500,000

Gallon

Whole milk, fresh or sour , Calendar Year

3,000,000

Gallon

Cattle, les^s than 200 lbs. 12
each
mos. from
Cattle, 700 lbs. or more each
(other than dairy cows)

April 1, 1958

200,000

Head

9,456

April 1, 1958 June 30, 1958

120,000

Head

34,098

Fish, fresh or frozen,,Filleted,
etc., cod, haddock, hake,
pollock, cusk, and rosefish ... Calendar Year 35,892,221

Pound

Quota Filled^1)

Tuna fish

Calendar Year 44,693,874

Pound 16,035,401

White or Irish potatoes:
Certified seed
Other .

12 mos. from 114,000,000
Sept. 15, 1957 36,000,000

Pound
Pound

Walnuts *

Calendar Year

Pound 1,971,356

5,000,000

Almonds, shelled, blanced,
roasted, or otherwise prepared Oct. 23, 1957 or preserved
•< Sept. 30, 1958 5,000,000
Alsike clover seed
Peanut oil .
Woolen fabrics

Quota Filled
Quota Filled

Pound

4,900,217

12 mos. from
July 1, 1957

3,000,000

Pound

233,697

12 mos. from
July 1, 1957

80,000,000

Pound

2,050,459

Calendar Year 14,200,000

Pound 11,5^2,902

(l) Imports for consumption at the quota rate are limited to 17,946,110 lbs. during
the first six months of the calendar year.
(continued)

- 2 -

Unit
:
of
: Imports as of
Quantity: May 31, 1958

Commodity

Absolute Quotas:
Peanuts, shelled, unshelled,
blanched, salted, prepared, or
preserved (incl. roasted pea12, mos. from
nuts but not peanut butter) ... Aug. 1, 1957
Eye, rye flour, and rye meal

Butter substitutes, including
butter oil, containing 45$
or more butterfat
Tung oil ..

1,709,000

Pound

Quota filled

12 mos. from
July 1, 1957
Canada
182,280,000
Other Countries 3,720,000

Pound
Pound

Quota filled

Calendar Year

1,200,000

Pound

1,199,952

Feb. 1 - Oct. 31, 1958
Argentina
18,475,901
Paraguay
2,437,128
Other Countries
739,366

Pound
Pound
Pound

Quota filled
Quota filled
Quota filled

TREASURY DEPARTMENT
Washington

... y

IMMEDIATE RELEASE,
Thursday. June 12. 1958.

A-258

The Bureau of Customs announced today the following preliminary
figures showing the imports for consumption from January 1, 1958, to
May 31, 1958, inclusive, of commodities for which quotas were established pursuant to the Philippine Trade Agreement Revision Act of
1955:

Commodity

Buttons

Established Annual
Quota Quantity
807,500

Unit of : Imports as of
Quantity: May 31, 1958

Gross

216,863

Cigars 190,000,000

Number

1,592,615

Coconut oil ...... 425,600,000

Pound

70,630,561

Cordage 6,000,000

Pound

1,809,528

(Refined .....
Sugars
(Unrefined ...

10,972,560
1,904,000,000

Tobacco .......... 6,175,000

Pound
875,019,696
Pound

1,292,873

TREASURY DEPARTMENT
Washington

259

IMMEDIATE RELEASE,

Thursday. June 12, 1958.

A-258

The Bureau of Customs announced today the following preliminary
figures showing the imports for consumption from January 1, 1958, to
May 31, I958, inclusive, of commodities for which quotas were established pursuant to the Philippine Trade Agreement Revision Act of
1955:

Commodity

Established Annual : Unit of
Quota Quantity
: Quantity:

Buttons

807,500

Gross

Imports as of
May 31, 1958

216,863

Cigars . 190,000,000

Number

1,592,615

Coconut oil ...... 425,600,000

Pound

70,630,561

Cordage 6,000,000

Pound

1,809,528

(Refined
Sugars
(Unrefined ...

10,972,560
1,904,000,000

Tobacco .......... 6,175,000

Pound
Pound

875,019,696
1,292,873

TREASURY DEPARTMENT
Washington
IMEDIATE RELEASE,

Cm mj V»

Thursday, June 12. Iftg8.

A-£59

The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and wheat flour authorized to be entered, or withdrawn
from warehouse, for consumption under the import quotas established in the
President's proclamation of May 28, l°4l, as modified hy the president«s
proclamation of April 13, 19h2s for the 12 months commencing May 29, 1958,
as follows?

TJheat
Country
of
Origin

Established :
Imports
to
Quota
ills? 29* 1958*
:May 31, 1958
(Bushels)
(Bushels)

795,000
Canada
China
Hungary
Hong'Kong
Japan
United Kingdom
100
Australia
Germany
100
Syria
100
New Zealand
Chile
Netherlands
100
Argentina
2,000
Italy
100
Cuba'
~
France
1,000
Greece
Mexico
100
Panama
Uruguay
Poland and Danzig
Sweden
Yugoslavia
Norway
Canary Islands
Rumania
1,000
Guatemala
100
Brazil
100
Union of Soviet
Socialist Republics
100
Belgium
100

795,000

Hheat flour, semolina,
crushed or cracked
wheat, and similar
wheat products
Jstablished
Quota
(Pounds)
3,815,000
24,000
13,000
13,000
8,000
75,000
1,000
5,000
5,000
1,000
1,000
1,000
14,000
2,000
12,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000

Imports
May 29, 1958*
to May 31. lffi
(Pounds)
3,815,000

261

TREASURY DEPARTMENT
Washington
M E D I A T E RELEASE,

Thursday, June 12r lereft

A-259

The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and -wheat flour authorized to be entered, cr withdrawn
from warehouse, for consumption under the import quotas established in the
President's proclamation of May 23, 194l, as modified by the president's
proclamation of April 13, 1942, for the 12 months commencing May 29, 1958,
as follows?
i

1
\
:
1

Wheat
Country
' Of
Origin

!
' Established *
sMay
•
Quota
sMay
(Bushels)

Canada
China
Hungary
Hong'Kong
Japan
United Kingdom
Australia
Germany
Syria
New Zealand
Chile
Netherlands
Argentina
Italy
Cuba,
France
Greece
Mexico
Panama
Uruguay
Poland and Danzig
Sweden
Yugoslavia
Norway
Canary Islands
Rumania
Guatemala
Brazil
Union of Soviet
Socialist RepublicJS
Belgium

795,000
mm

100
-

100
100
.-

100
2,000

100
mm

1,000
—

100
mm

—
—
—
mm.

1,000

100
100
100

100

Hheat flour., semolina,
crushed or cracked
wheat, and similar
wheat products

1 Established s
Imports
Imports
Quota
: May 29, 1958?
29, 1958, to 1
31, 1958
• to May 31,_195.8
j
(Pounds)
(Pounds)
(Bushels)
795, 000
_
_
m.
m.
m.

„

_
"
"
"
~

3,815,000
24,000
13,000
13,000
8,000
75,000
1,000
5,000
5,000
1,000
1,000
1,000
14,000
2,000
12,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
—
~->
•"*
—
"

3,815,000
_
-

TREASURY DEPARTMENT
Washington

9^0
C.yi Cm

MEDIATE RELEASE,

Thursday. June lfr im&.

A-260

The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and wheat flour authorized to be entered, or withdrawn
from warehouse, for consumption under the import quotas established in the
President's proclamation of May 28, l°4l, as modified by the president's
proclamation of April 13, 1942, for the 12 months commencing May 29, 1957,
as follows?

Wheat
Country
of
Origin

Established :
Imports
Quota
tMay 29, 19 575 to
.'May 28. 1958
(Bushels)
(Bushels)

Canada
795,000
China
Hungary
Hong! Kong
Japan
100
United Kingdom
Australia
100
Germany
100
Syria
New Zealand
Chile
100
Netherlands
2,000
Argentina
100
Italy
Cuba'
1,000
France
Greece
100
Mexico
Panama
Uruguay
Poland and Danzig
Sweden
Yugoslavia
Norway
1,000
Canary Islands
100
Rumania
100
Guatemala
Brazil
100
Union of Soviet
100
Socialist Republics
Belgium

795,000

Wheat flour, semolina,
crushed or cracked
wheat, and similar
wheat products
: Established
?
Quota
(Pounds)
3,815,000
2U,000
13,000
13,000
8,000
75,000
1,000
5,000
5,000
1,000
1,000
1,000
14,000
2,000
12,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000

Imports
May 29, 1957,
to May 28, 1QS£
(Pounds)
3,815,000

276

TREASURY DEPARTMENT
Washington

263

IMMEDIATE RELEASE,

Thursday, June 12, 1958

A-260

The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and wheat flour authorized to be entered, or withdrawn
from warehouse, for consumption under the import quotas established in the
President's proclamation of May 28, 194l, as modified by the president's
proclamation of April 13, 1942, for the 12 months commencing May 29, 1957,
as follows;

Wheat
Country
'of
Origin

Established s
imports
Quota ftMay 29, 19 57, to
„
:May 28, 1958
(Bushels)
(Bushels)

Canada
China
Hungary
Hong Kong
Japan
United Kingdom
Australia
Germany
Syria
New Zealand
Chile
Netherlands
Argentina
Italy
Cuba,
France
Greece
Mexico
Panama
Uruguay
Poland and Danzig
Sweden
Yugoslavia
Norway
Canary Islands
Rumania
Guatemala
Brazil
Union of Soviet
Socialist Republics
Belgium

795,000
—
—
—

100
-

100
100
-

100
2,000

100
mm

1,000
—

100
"—
"—
*—
—
—
—'
—

1,000

100
100
100
100

795,000

Wheat flour, semolina,
crushed or cracked
wheat, and similar
wheat products
: Established
*
Quota
(Pounds)
3,815,000
2U,000
13,000
13,000
8,000
75,000
1,000
5,000
5,000
1,000
1,000
1,000
14,000
2,000
12,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000
1,000

Imports
May 29, 1957»
to May 28t 1958
(Pounds)
3,815,000

276

-g_
COTTON WASTES
(In pounds)
COTTON CARD STRIPS made from cotton having-a staple of less than 1-3/16 inches in length, COMBER
WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE, WHETHER OR NOT MANUFACTURED OR OTHERWISE
ADVANCED IN VALUEi Provided, however, that not more than 33-1/3 percent of the quotas shall
be filled by cotton wastes other than comber wastes made from cottons of 1-3/16 inches or more
in staple length in the case of the following countries? United Kingdom^ France, Netherlands,
Switzerland* Belgium, Germany, and Italy.
Established
TOTAL QUOTA

Country of Origin
United Kingdom .
Canada
France « . . „ .
British India .
Netherlands • .
Switzerland . .
Belgium . . . .
Japan • • • • •
China • . • • •
Egypt . • • • • ,
Cuba . . . .
Germany . . . . ,
JL.ta.Ly . . . . .

•

9 »

a .

9 •

• .
.
o 0
9 .
. . •

. 9

Total Imports
Sept. 20, 1957, to
June 10, 1958

Established
33-1/3% of
Total Quota
1,441,152

Imports
Sept. 20, 1957
to June 10, 1958
954^54

4,323,457
239,690
227,420
69,627
68,240
44,388
38,559
341,535
17,322
8,135.
6,544
76,329
21,263

954,054
239,690

11,134
6,915

25,443
7,088

11,134
6,t9l5

5,482,509

1,278,058

1,599,886

972,103

1/ Included in total imports, column 2.
Prepared in the Bureau of Customs.

75,807
66,265
22,747
14,796
12,853

TREASURY DEPARTMENT
Washington

en
IMMEDIATE RELEASE

A-261

Thursday, June 12, 1958.

Preliminary data on imports for consumption ofcotton and cotton waste .chargeable to the quotas
established by the President'-s Proclamation of Septembers, 1939, as amended
COTTON (other than linters) (in pounds)
Cotton under 1-1/8 inches other than rough or harsh under 3/4u
Imports Sept. 20, 1957. to June 10, 1958
Country of Origin,
Egypt and the Anglo
Egyptian Sudan .
Jreru . . . . .- . «
British India • • .
Vshina

. . . . .. .* .. . - .

Mexico • .
. » . . »
Brazil . . . : . • .
Union of Soviet
Socialist Republics
Argentina .
. . . .
Haiti . . .
Ecuador . •

Established Quota
783,816
247,952
2,003,483
1,370,791
8,883,259
618,723
475,124
5,203
237
9,333

Country of Origin

Imports

7,296

8*883,259
600,000
3>649

Honduras . . . . . .»
Paraguay . . . . . . .
Colombia . . . » . . .
JLraq . . . . . . o . •
British East Africa . .
Netherlands E. Indies.
Barbados . . . . . . .
l/Other British W. Indies
Nigeria
• .
2/0ther British W. Africa
^Other French Africa . .
Algeria and Tunisia •

Established Quota
752
871
124
195
2,240
71,388
21,321
5,377
16,004
689

1/ Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
2/ dther than Gold Coast and Nigeria.
\f Other, than Algeria, Tunisia, and Madagascar.
Cotton 1-1/8" or more
Imports August lt 1957. to Dec. 31* 1957* indi
rit ?i-i\it

EwaMJag^jfti **Wfc^(lmtM

Established Quota (Global)
45,656,420

Imports
45,656,420

TREASURY DEPARTMENT
Washington

IMMEDIATE RELEASE

Thursday, June 12, lftj58.

A-261

Preliminary data on imports for consumption of cotton and cotton waste chargeable to the quotas
established by .the Presideat'^. Proclamation of September 5, 1939, as amended
/
COTTON (other than linters) (in pounds)
Cotton under 1-1/8 inches other i;han rough or harah under 3/4»
Imports Sept. 20. 1957. to June 10. 1958
^L*
Country of Origin
Egypt and the Anglo—
Egyptian Sudan . .
Peru . . . . . . . .
British India . . . .
China . . . . . . . .
Mexico . . . . . . .
Brazil . . . . . , . ,
Union of Soviet
Socialist Republics
Argentina .
tiaiui

. . . . . . . .

Ecuador . .

. *. . . .

Estabiished Quota
763,816
247,952
2,003,483
1,370,791
8,883,259
618,723

Imports

7,296
«.
-

Established Quota

Honduras
Paraguay

752

„

British East Africa . .
Netherlands E. Indies.

8,883,259
600,000
m.

475,124
2,203
.. 237
9,333

Country of Origin

l/0ther British W. Indies

3,649
=•

2/0ther British W. Africa
pother French Africa . .
Algeria and Tunisia .

871
124
195
2,240
71,388
21,321 I
5,377
16,004
689

1/Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
2/ Other than Gold Coast and Nigeria.
y Other than Algeria, Tunisia, and Madagascar.
Cotton l-l/8n or more
Imports Augusft l. 1Q57 to Dec. 31, 1957. incl.
Established Quota (Global'

Imports

45,656,420

Imports

-2COTTON PASTES
{In pounds)
COTTON CARD STRIPS made from cotton having-a staple of less than 1-3/16 inches in length, COMBER
WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE, WHETHER OR NOT MANUFACTURED OR OTHERWISE
ADVANCED IN VALUEt Provided, however, that not more than 33-1/3 percent of the quotas shall
be filled by cotton wastes other .than comber wastes made from cottons of 1-3/16 inches or more
in staple length in the case of the following countries? United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany, and Italy*

Country of Origin

Established
TOTAL QUOTA
.

United Kingdom . . . . .
4,323,457
Canada . . . . . . . . .
239,690
France . . . . . . .
. «
227>420
British India . . . . . .
69,627
Netherlands . . . . . . .
68,240
Switzerland • • • • • • •
44,388
Belgium. .........
38,559
Japan . ... . . -.. . . . .
341,535

*
Total.Imports "1 Established s I m p o r t s T J
• Sept. 20, 1957, to s 33-l/3# of s Sept. 20, 1957
; June 10, 1958
g Total Quota t to June 10, 1958
954,054
239,690

1,441,152

954,054

75,807
66,265
22,747
14,796
12,853

C h i n a ~. . . . . . . . . .

•*- • > y&m<L

Egypt • • • • • . • . . .
Cuba • « . . • • • • • •
Germany *•
Italy • • • •
..... .

8,135
6,544
76,329
219263

11,134
6,915

25,443
7.088

11,134
6,915

5,482,509

1,278,058

1,599,886

972,103

1/ Included in total imports, column 2,
Prepared in the Bureau of Customs.

STATUTORY DEBT LIMITATION
AS 0F.MOl*...l$&8,

TREASURY DEPARTMENT
Fiscal 8ervlo«

June 12A958

Washington, .........
*..««...
DI
Section 21 of Second Liberty Bond Act, as amended, provides that the face amount
a mount.of
.
^
J
p
.
^
J
j
f
.
J
f
l
S
J
S
i
«
b
l
«*
01 ° » " W " " J ^ 7 ~ : K .ucbguif
of that Act, and the face aimount
r ~ — of
-' obligations
-»-ia—»x— guaranteed
„.,-,-„,.>..4 as
«,«, to
nnnrmal and
and interest
interest by
bv the
the United^States
United S»teo lexcej*
< e * c " P ^ 0 J6
(n principal
ons as may
may be
be held
held by
by the
the Secretary
Secretary of
of the
the Treasury),
Treasury;, <s
snau
.nteed obligation^*
al nnuio «t« .;c e ^u ..j. .-».
i
W-6*»r£"p J S ^ ;-.
f nn
f lhef current
f , , .re(Act of June 26, 1946; U.S.C., title 31, sec. 757b), outstanding at any one time. Forpurposes of ths s * ™ ^ X h d d i
demotion value of any obligation issued on a discount basis Which is redeemable p u « ^^g^^V^SlJSi
that during the
shaft be considered as its face amount." The Act of February 26, 1958, (P.L. 85 -336 85th ^ ^ " ' ^ " J £ temporarily
period beginning on February 26, 1958 and ending June 30, 1959, the above limitation ($275,000,000,000) shall be temporarily
increased by $5,000,000,000.
.
, .
The following table shows the face amount of obligations outstanding and the face amount which can still be issued under
$280,000,000,000
this limitation:
Total face amount that may be outstanding at any one time
OutstandingObligations issued under Second Liberty Bond Act, as amended
Interest-bearing:
Treasury bills
Certificates of indebtedness.
Treasury notes
BondsTreasury
* Savings (current redemp. value)
Depositary.....
Investment series
Special FundsCertificates of indebtedness
Treasury notes.
Treasury bonds
Total interest-bearing
Matured, interest-ceased
Bearing no interest:
United States Savings Stamps
Excess profits tax refund bonds
Special notes of the United States:
Internat'l Monetary Fund series
Total

I 22.404,988,000
311121,687,000
24.764.816.000 , ?8,291,491,000
8? , 647 ,189 , 550
5 2 ,085, 992,***^

163,349,000
9.677.162.000 149,573,692,994
30*002,702,000
12,649,917,000
3.462,500.000

53,024,114
892,514
690.000.000

Guaranteed obligations (not held by Treasury):
Interest-bearing:
96,100,550
Debentures: F.H.A
Matured, interest-ceased
_
655.725
Grand total outstanding ._
Balance face amount of obligations issuable under above authority,

743.916.628
275,220,617,121

96.756.275
275.317.373.396
4,682,626,604

Reconcilement with Statement of the Public Debt......}^...d„.*...^.?>„.
(Date)
(Daily Statement of the United States Treasury,
.*?*?..?.?» . 1 9 5 8
(Date)

,.
OutstandingTotal gross public debt
.,,,„
,
Guaranteed obligations not owned by the Treasury.
,..
,
Total gross public debt and guaranteed obligations,
,
Deduct - other outstanding public debt obligations not subject to Hebt limitation..,

A-262

275,652,540,684
96,756,275
275,749,296,959
431.923.563
275,317,373,396

268
STATUTORY DEBT LIMITATION

_ .. , June 12J.953

AS o,J!HL»_J!2».

Washington, „..„......»«*
*• ••
uthorlty
luchguat*
000,000
current rethe holder
tt during the
temporarily
The following table shows the face amount of obligations outstanding and the face amount which can still be issued under
this limitation:
Total face amount that may be outstanding at any one time
$280,000,000,000
OutstandingObligations issued under Second Liberty Bond Act, as amended
Interest-bearing:
Treasury bills
$ 22,404,988,000
Certificates of indebtedness,
«
31,121,687,000
Treasury notes
24.764.816.000 $ 7 8 , 2 9 1 , 4 9 1 , 0 0 0
BondsTreasury
87,647,189,550
M
* Savings (current redemp. value)
52,085,992» i W'
Depositary.
163 ,349 ,000
Investment series
9.677.162.000
149,573.692.994
Special FundsCertificates of indebtedness
30,002,702,000
Treasury notes.
12,649,917,000
Treasury bonds
3.462.500.000
46.115.119.000
Total interest-bearing
i
273,980,302,994
496,397,499
Matured, interest-ceased
Bearing no interest:
United States Savings Stamps
Excess profits tax refund bonds
Special notes of the United States:
Internat'l Monetary Fund series.......
Total

53,024,114
892,514
690.000.00Q

743.916.628
275,220,617.121

Guaranteed obligations (not held by Treasury):
Interest-bearing:
96.100,550
Debentures: F.H.A
»
656.725
Matured, interest-ceased
_
Grand total outstanding
,
Balance face amount of obligations issuable under above authority

96.756.275

Reconcilement with Statement of the Public Debt

275.317.373.396
4,682,626,604
»£.««.

(Daily Statement of the United States Treasury,... .^...?9/L.ip J
OutstandingTotal gross public debt
Guaranteed obligations not owned by the Treasury.
Total gross public debt and guaranteed obligations....
Deduct - other outstanding public debt obligations not subject to Bebt lunii.iioo.

A-262

275.652,540.634
96.756,275
275.749.296,959
431,923,563
275.317.373.396

-, ( f t
B9TOIA3?! 2HL8I8B#
?rtday, Juan 13^. 1959.

9fao SrwuRixy mm^mt
w m m M d tomy ttetfitatltmlmlmMim of mbmrip*»
tioxw for tb» rvetat oacebasig© offering abonta $1,815 ttllUon iter ttso &«*r >i/4
1p@ro«t ©ertifi^tesftn>May IS, 1959, an* $?*3§4 allUon for tl» S-9/il p®^©at
boafe of 1065tofttferuftx?13* 1993*
AMI following tables #iow %bt mount* otttftttsftiag of the tterm immim
mXSBjtiaiX* for mebsagft &&& th* extmt to ifele*. tbmy mm being ®%chmm®& tor tbo
aow iiiuiS; and o^baerlptloiui by luteal B*mr** Mstriets.
(Da millions of iollftra)
Sliglbl*

A-OSSS

mm***.**.. $&,%m

m r o m g o m&scripkiom

$X,OIB

$s,i95

tor Mm

Z&mmm

#4,10?

$194

Bonds of 1968«e3... 919 91 80^ S®5 35
m»nm ®t mm****** A,zm 710 3,399 4*099 MS
tbtol..... #,555 |X*§1§ $7,394 $9,900 $S5«
«M»»~«»M»«M»

W H M •Mi»ii,.«»»ip.i»itMi).)i.wwm»TOI»*^

mmul, .aMMIW»lu.ilM«l»l^»wiM.i(«^

FNLemI toenr© l«i/4^ Ctfo. 9~§/®$ Boa&s
Bittrtet
jorfof B»19a9
Barton
Mm lork
milauLUlpkim
OXmolm^
Hieteoat
Atlanta
Cbicngo
St* Louis
mmmmoliB
mnmB City
mUmm
Bm WrmoUto
Tr**mvxy
fot&l

«""' ' niiri.iHu

of 3J99

$
49#999,000
1,016,421,000
31,799,000
79,757,000
54,511,000
44,898,000
989,948,000
4O,4S9,0O0
37,199,000
§5,409,000
44,449,000
87,702,000
8,991,000

998,596,500
4,040,950,500
148,991,900
979,191,000
136,447,S00
216,993,000
1,059,099,000
242,903,000
107,810,000
245,449,000
174,377,000
439,215*500
19,381,000

$1,815,891,000

$7,384,371,500

[iilim.

27u

TREASURY DEPARTMENT
WASHINGTON. D.C.
IMMEDIATE RELEASE,
Friday, June 13, 1958*

A-263

The Treasury Department announced today that final tabulation of subscriptions for the recent exchange offering showed $1,815 million for the new 1-1/4
percent certificates due May 15, 1959, and $7,384 million for the 2-5/8 percent
bonds of 1965 due February 15, 1965.
The following tables show the amounts outstanding of the three issues
eligible for exchange and the extent to which they are being exchanged for the
new issues, and subscriptions by Federal Reserve Districts.
(In millions of dollars)
Eligible
for
Exchange
A-1958 Notes

$4,392

Bonds of 1958-63.,, 919
Bonds of 1958......

4,245
$9,555

Total

Exchange Subscriptions for New Issues
1-1/4$
2-5/8$
rZ+Ti
Unexchanged
Total
Ctf s *
Bonds
$1,015

$3,193

$4,207

802

893

710

3,389

4,099

$1,815

$7,384

$9,200

SUBSCRIPTIONS BY FEDERAL RESERVE DISTRICTS
Federal Reserve
District

1-1/4$ Ctfs.
Series B-1959

2-5/8$ Bonds
of 1965

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco
Treasury

$ 42,669,000
1,018,421,000
31,785,000
79,757,000
34,311,000
44,262,000
256,242,000
40,462,000
37,135,000
95,409,000
44,445,000
87,702,000
2,661,000

t 228,586,500
4,040,850,500
142 ,681,500
278,121,000
136 ,447,500
216 ,983,000
1,059 ,628,000
242,893,000
167 ,819,000
245 ,448,000
174,377,000
432 ,215,500
18 ,321,000

$1,815,261,000

$7,384,371,500

Total

$9 X9fM

Cll

^mm^LMx^xmh,M^
3 m Hallowing 1v*jt*a«Ue&w w%tm m m in 4£t*et *M gaftffwJKtmt **m*Htims
mi m* Gowtmmfe for Tr^aomy InvMtmnt* tat othmt mmmmmmmterlag%t%*

mwm of an?^ ifsii
mimrn tm*m*»50o.oo

^Cwl33oIo5

(8&d) Charles X« Sraeasta

^i£#£, Xamttmnt* aewmfe
Blvlnlon of Dopooit*. & ZnwwHmnrt*

TREASURY DEPARTMENT

979

WASHINGTON, D.C

IMMEDIATE RELEASE,
Thus.- su ayr--Ma5F-4r^-rt-^93^

During ^pa*JA 1958, market transactions
in direct and guaranteed securities of the
government for Treasury investment and other
accounts resulted in net^sales by the
Snh0
hmmijt
Treasury Department

ot.

0O0

TREASURY DEPARTMENT
WASHINGTON, D.C.

IMMEDIATE REDS ASS,
Monday, June 16, 1953.

A-264

During May 1953, market transactions
in direct and guaranteed securities of the
government for Treasury investment and other
accounts resulted in net sales by the
Treasury Department of $86,297*500.

oOo

274

BSKASi A, M* mU3BUPI9S f
ftaoodny, feao 17, X9$o**

fho Treasury Departmerrfc osmott&ood Xaet evening that tho tenders for 11,700,000,000
or tmrmbovt*, .of fl**®*y Tmi«7 bill* to bo 4*ta* im* It and to mtur* Soptoiiber II,
Xf$B, wkLob wore offorod on 4mm IM, nor© mtmd st tho f*mmt*X aooowo loisks on
<ta© 16.
Tm detail® of this immm mm mm follow* i
total «mli«d tott ~ •t»lt71«6'96,000
total aocofted
- l,700,W t 0QQ (inoli^o® 1161,078,000 ontorod on *
noncompetitive basis and accepted in
fiO! Hi the average price shown below)
m®g® *t *m*mptmA omgmtitim blm*

~ 99.850 Sqpimlm* rato of iiooomt mppmx. Q.$93% pmr oimm
- ff.|0
*
« »
»
*
0«ftf* •
»

Ammm

- ftoJ*

•

«•

•

Q.9$3% *

(16 mm of m mom* b&# for at im low mim mm mmptmi)
foderol Boaorm

Total
Appllod for .

Mmtrimt
Boston
low lork
Cl0Y®lMm&

Atlanta
CMoOgO
st« i^nio
Mlxuaomollo
\%m*m City,

HmUm
Son ffc&noisoo

f $99m»®m
x*7xi9m,om
m9m9ooo
6$9m9om
79M*o®o
k39nk*ooo
299,601,000
38,536,000
1£,H0,OOO
A # bt7f0oo
22*8*9,000
WKAIi #2,1*71,696,000

f©ta
Accepted
i
3?,i$i3,ooo
l*07t*89f*OOO
3fc*305*000
52,288,000
?,S6l,000
J7*h»*000
8tf*&T»000
38*536,000
19,11*3*000
l*0,Wf,000
22,8*9,000
90,21*0,000
#1,700,932,000

RELEASE A. M. NEWSPAPERS,
Tuesday, June 17, 1958. "

A-265

The Treasury Department announced last evening that the tenders for $1,700,000,000,
or thereabouts, of 91-day Treasury bills to be dated June 19 and to mature September 18,
1958, which were offered on June 12, were opened at the Federal Reserve Banks on
June 16.
The details of this issue are as follows 5
Total applied for - $2,1*71,696,000
Total accepted
- 1,700,932,000 (includes $261,078,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)
Range of accepted competitive bids?
High - 99.850 Equivalent rate of discount approx. 0.$93% per annum
Low

- 99*1$$

0.969$ «

Average - 99*1$9 n " " " n 0.953$ n »
(16 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

$ 39,^413,000
1,717,692,000
1*2,1*52,000
63,168,000
7,91*5,000
1*3,781*,000
299,607,000
38,536,000
19,11*3,000
51i,»427,000
22,869,000
122,660,000

$ 39,1*13,000
1,072,892,000
314,305,000
52,288,000
7,861,000
37,1*31,000
2145,527,000
38,536,000
19,11*3,000
1*0,1*27,000
22,869,000
90,21*0,000

$2,1*71,696,000

$1,700,932,000

TOTAL

- 3 -

?7C

or by any local taxing authority. For purposes of taxation the amount of discou
at which Treasury bills are originally sold by the United States is considered

be interest. Under Sections h$k (b) and 1221 (5) of the Internal Revenue Code o
1951* the amount of discount at which bills issued hereunder are sold is not
considered to accrue until such bills are sold, redeemed or otherwise disposed
and such bills are excluded from consideration as capital assets. Accordingly,

the owner of Treasury bills (other than life insurance companies) issued hereun

need include in his income tax return only the difference between the price pai
for such bills, whether on original issue or on subsequent purchase, and the
amount actually received either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or loss.
Treasury Department Circular No. 1*18, Revised, and this notice, prescribe

the terms of the Treasury bills and govern the conditions of their issue* Copie
of the circular may be obtained from any Federal Reserve Bank or Branch*

- 2 -

??>

xxxxx
2 percent of the face amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank or trust
company.
Immediately after the closing hour, tenders will be opened at the Federal Re-

Secretary of the Treasury expressly reserves the right to accept or reject any o
all tenders, in whole or in part, and his action in any such respect shall be

final. Subject to these reservations, noncompetitive tenders for $200,000 or les

without stated price from any one bidder will be accepted in full at the average
price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on June 26. 1958 ,, in cash or other immediately available funds
or in a like face amount of Treasury bills maturing June 26. 1958 . Cash

and exchange tenders will receive equal treatment. Cash adjustments will be made

for differences between the par value of maturing bills accepted in exchange and
the issue price of the new bills.
The income derived from Treasury bills, whether interest or gain from the

sale or other disposition of the bills, does not have any exemption, as such, an
loss from the sale or other disposition of Treasury bills does not have any
special treatment, as such, under the Internal Revenue Code of 1951*. The bills
are subject to estate, inheritance, gift or other excise taxes, whether Federal

or State, but are exempt from all taxation now or hereafter imposed on the princ

or interest thereof by any State, or any of the possessions of the United States

?7M
r *y

BOQDBHCXX
iWmlmtt

TREASURY DEPARTMENT

Washington ./~y &* U?

A. M.
KXK RELEASE/ ® W 3 » NEWSPAPERS,
Thursday, June 19, 1958
The Treasury Department, by this public notice, invites tenders for
$1,700,000,000 , or thereabouts, of 91 -day Treasury bills, for cash and

liar

in exchange for Treasury bills maturing
June 26. 1958
$ i n the amount of
$1.700,801^000 , to be issued on a discount basis under competitive and noncompetitive bidding as hereinafter provided. The bills of this series will be
dated Jane 26, 1958 _, and will mature September 25, 1958 , when the face

amount will be payable without interest. They will be issued in bearer form only

and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,0
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
one-thirty
Daylight Saving
closing hour,/jfejflB o'clock p.m., Eastern/fitaoacteBfl time, Monday, June 25, 1958
Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1,000, and in the case of competitive tenders

the price offered must be expressed on the basis of 100, with not more than thre
decimals, e. g., 99*92$. Fractions may not be used. It is urged that tenders

incorporated banks and trust companies and from responsible and recognized deal
in investment securities. Tenders from others must be accompanied by payment of

27s
TREASURY DEPARTMENT

fVj&g.

^jtx^J^^a^^^»?^^^cua!',^iJ^:^JP•:\,•^sp^x•;x;g7

WASHINGTON, D.C.
RELEASE A.M. NEWSPAPERS,
Thursday, June 19, 1958.

A-266

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing June 26, 1958,
in the amount of $1,700,801,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated June 26, 1958,
and will mature September 25, 1958, when the face amount will be
payable without interest. They will be^issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.nu, Eastern Daylight
Saving time, Monday, June 23* 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deoosit from incorporated banks and trust companies and from
responsive and recognizeddealers in investment securities
Tenders
from others must be fccompanied by Payment of 2 Pejoen o
he face
omrtl,nf n? fY>e>*sur>v bills applied for, unless the tenders are
^ c S a n l e ^ b y ^ egress guaranty of payment by an incorporated bank
or trust company.
Tnrn^ifll-olv after the closing hour, tenders will be opened at the
„ , ^-Tttitlll T^nll and Branches, following which public announceFederal Reserve Banks and aranc
^
tmenfc o f t h e a m o u n t and price
ment will be made by the Treasury JMP
tenders w i U be advised of
range of accepted oias. ,f" thereof
The Secretary of the Treasury
the acceptance or rejection thereof
The
J
^ ^
^ ^
expressly reserv« the right to
p
such respeot s h a U „
in whole or in part and nis a
non-competitive tenders for
final. S u b * ? c * ^ t h o u t stated price from any one bidder will be
icceoted In full at'thfaverage £rice (in three decimals) of accepted

- 2 m

competitive bids. Settlement for accepted tenders in accordance
with the bids must be made or completed at the Federal Reserve Bank
on June 26, 1958,
in cash or other Immediately available funds
or in a like face amount of Treasury bills maturing June 26, 1958.
Cash and exchange tenders will receive equal treatment. Cash
adjustments will be made for differences between the par value of
maturing bills accepted in exchange and the issue price of the new
bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition ©f the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as such,
under the Internal Revenue Code of 1954• The bills are subject
to estate, inheritance, gift or other excise taxes, whether Federal
or State, but are exempt from all taxation now or hereafter imposed
on the principal or interest thereof by any State, or any of the
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount-of discount at which Treasury
bills are originally sold by the United States is considered to
be Interest. Under Sections kl5k (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life Insurance companies)
issued hereunder need Include in his income tax return only the
difference between the price paid for such bills, whether ©n
original issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular N©0 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their Issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Branch.

oOo

3o0
RELEASE A. K. MMSPAPKES,
Tuesday, June 24, 1958*
the treasury Department announced last owtiug that the tenders for 11,700,000,000,
or thereabout®, of 91-day treasury bills t© b® dated *hm 26 and to mature sopto®0er 25,
1958, which were offered on taje 19* were opened at the Federal leserve Bonks on «June 23
The details of this issue are as follows:
Total applied for - #2,1*70,831,000
Total aeeepted
- 1,700,23*1,000

(includes |26?,45l,GOO entered on a
~ noncompetitive basis and accepted In
full at the average price shown below)

tango of accepted competitive bliss
High
Low

- 99.759 louivalent rate of discount approx* 0.9531 per annum
w
B
- 99.74$
« w
. •"
1.017* "
•

Average

-99.746

1.006* "

(87 percent of the amount bid for at tho low price was accepted)
Federal Reserve
District

Total
Applied for .

Total
Aeeepted

Boston
Wew fork
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

40,194,000
1,783,261,0)0
44,906,000
53,040,000
20,623,000
37,336,000
266,573,000
22,872,000
28,086,000
43,162,000
19,732,000
111,039,000

I
37,252,000
1,132,001,000
31,386,000
53^01^,000
20,623,000
36,1*08,000
2O2,3lS,0OO
22,872,000
28,086,000
32,772,000
19,632,000
83,81*4,000

12,470,831,000

11,700,234,000

TOTAL

TREASURY DEPARTMENT
WASHINGTON, D.C.
RELEASE Ac M. NEWSPAPERS,
Tuesday, June 24» 1958.

A _26?

The Treasury Department announced last evening that the tenders for #1,700,000,000

or thereabouts, of 91-day Treasury bills to be dated June 26 and to mature September 25

1958, which were offered on June 19, were opened at the Federal Reserve Banks on June 2
The details of this issue are as followss
Total applied for - $2,470,831,000
Total accepted
- 1,700,234,000

(includes $267,451,000 entered on a
noncompetitive basis and accepted in
full at the average price shown below)

Range of accepted competitive bidss
- 99*1$9 Equivalent rate of discount approx. 0.9$3% per annum
- 99.743
•»
« st
«
n
- 99.746

www « 1.006*

i # oi7*

(87 percent of the amount bid for at the low price was accepted)
Federal Reserve
District

Total
Applied for

Total
Accepted

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St, Louis
Minneapolis
Kansas City
Dallas
San Francisco

$
37,252,000
1,132,001,000
31,386,000
53,01*0,000
20,623,000
36,408,000
202,318,000
22,872,000
28,086,000
32,772,000
19,632,OCX)
83,81*4,000

4o*x94,ooo

1*783,261,000
kk,906,000
53,01*0,000
20,623,000
37,338,000
266,578,000
22,872,000
28s086,000
43,162,000
19,732,000
111,039,000

TOTAL

$2,1*70,831,000

$1,700,234,000

- 3 -

or by any local taxing authority. For purposes of taxation the amount of disco

at which Treasury bills are originally sold by the United States is considered
be interest. Under Sections \6h (b) and 1221 (5) of the Internal Revenue Code
195U the amount of discount at which bills issued hereunder are sold is not

considered to accrue until such bills are sold, redeemed or otherwise disposed
and such bills are excluded from consideration as capital assets. Accordingly*

the owner of Treasury bills (other than life insurance companies) issued hereu

need include in his income tax return only the difference between the price pa
for such bills, whether on original issue or on subsequent purchase, and the

the terms of the Treasury bills and govern the conditions of their issue. Copie
of the circular may be obtained from any Federal Reserve Bank or Branch.

. 2.

383

Secretary of the Treasury expressly reserves the right to accept or reject any o
all tenders, in whole or in part, and his action in any such respect shall be

final. Subject to these reservations, noncompetitive tenders for $200,000 or les

without stated price from any one bidder will be accepted in full at the average
price (in three decimals) of accepted competitive bids. Settlement for accepted

tenders in accordance with the bids must be made or completed at the Federal Reserve Bank on July 5, 1958 j in cash or other immediately available funds
TSXX

or in a like face amount of Treasury bills maturing

July 5, 1958

. Cash

7=0*5

or State, but are exempt from all taxation now or hereafter imposed on the princ

or interest thereof by any State, or any of the possessions of the United States

?P4
SGEKXKXXXX

TREASURY DEPARTMENT , ^
Washington

A
ri

A. M.
WA RELEASE/ KBKKXHS NEWSPAPERS,
Thursday, June 26, 1958

//
<* ^y

—m—
competitive bidding as hereinafter provided. The bills of this series will be
dated July 3, 1958 , and will mature October 2, 1958 , when the face

amount will be payable without interest. They will be issued in bearer form only,
and in denominations of $1,000, $5,000, $10,000, $100,000, $500,000 and $1,000,0
(maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
©ne-thirty
Dayligit Saving
closing hour,/tK» o'clock p.m., EasternyfebEandSDOi time, Monday, June 30, 1958

Tenders will not be received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1,000, and in the case of competitive tenders

the price offered must be expressed on the basis of 100, with not more than thre
decimals, e. g., 99.925. Fractions may not be used. It is urged that tenders

incorporated banks and trust companies and from responsible and recognized deal
in investment securities. Tenders from others must be accompanied by payment of

TREASURY DEPARTMENT
!^fltj^j^MRa^ss?tau^j.,'a^.'T,ugj'.,J!ga,."-7-33sr^:

WASHINGTON, D.C.
RELEASE A.M. NEWSPAPERS,
Thursday, June 26, 1958.

A-268

The Treasury Department, by this public notice, invites tenders
for $1,700,000,000, or thereabouts, of 91-day Treasury bills, for
cash and in exchange for Treasury bills maturing July 3, 1958,
in the amount of $1,700,087,000, to be issued on a discount basis
under competitive and non-competitive bidding as hereinafter
provided. The bills of this series will be dated July 3, 1958,
and will mature October 2, 1958,
when the face amount will be
payable without interest. They will be issued in bearer form only,
and in denomination of $1,000, $5,000, $10,000, $100,000,
$500,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches
up to the closing hour, one-thirty o'clock p.m., Eastern Daylight
Saving time, Monday, June 30, 1958.
Tenders will not be
received at the Treasury Department, Washington. Each tender must
be for an even multiple of $1,000, and in the case of competitive
tenders the price offered must be expressed on the basis of 100,
with not more than three decimals, e. g., 99.925. Fractions may not
be used. It is urged that tenders be made'on the printed forms and
forwarded in the special envelopes which will be supplied by Federal
Reserve Banks or Branches on application therefor.
Others than banking institutions will not be permitted to submit
tenders except for their own account. Tenders will be received
without deposit from incorporated banks and trust companies and from
responsible and recognized dealers in investment securities. Tenders
from others must be accompanied by payment of 2 percent of the face
amount of Treasury bills applied for, unless the tenders are
accompanied by an express guaranty of payment by an incorporated bank
or trust company.
Immediately after the closing hour, tenders will be opened at the
Federal Reserve Banks and Branches, following which public announcement will be made by the Treasury Department of the amount and price
5»nc!p of accepted bids. Those submitting tenders will be advised of
the acceptance or rejection thereof. The Secretary of the Treasury
Tvn^qslv reserves the right to accept or reject any or all tenders
in whole or in part, and his action In any such respect shall be
in wxiux S u b , e c t t o these reservations, non-competitive tenders for
lonn 000 or less without stated price from any one bidder will be
cepted in full at the average price (in three decimals) of accepted

- 2 competitive bids. Settlement for accepted tenders innag£2!£S2c2«nk
with the bids must be made or completed at the Federal Reserve Ban*
on July 3, 1958,
In cash or other immediately available funds
or in a like face amount of Treasury bills maturing July 3, • w ° Cash and exchange tenders will receive equal treatment. g a ^ n
adjustments will be made for differences between the par value oi
maturing bills accepted in exchange and the issue price oi vne new
bills.
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, does not have
any exemption, as such, and loss from the sale or other disposition
of Treasury bills does not have any special treatment, as sucn,
under the Internal Revenue Code of 195*. ^ © b i l l s ^
*™ J 2 c ;L. o l
to estate, inheritance, gift or other excise taxes, whether federal
or State, but are exempt from all taxation now or hereafter imposed
on the principal or interest thereof by any State, or any or tne
possessions of the United States, or by any local taxing authority.
For purposes of taxation the amount of discount at which Treasury
bills are originally sold by the United States is considered to
be Interest. Under Sections 454 (b) and 1221 (5) of the Internal
Revenue Code of 1954 the amount of discount at which bills issued
hereunder are sold is not considered to accrue until such bills
are sold, redeemed or otherwise disposed of, and such bills are
excluded from consideration as capital assets. Accordingly, the
owner of Treasury bills (other than life insurance companies)
issued hereunder need include in his income tax return only the
difference between the price paid for such bills, whether on
original Issue or on subsequent purchase, and the amount actuallyreceived either upon sale or redemption at maturity during the
taxable year for which the return is made, as ordinary gain or
loss.
Treasury Department Circular No. 4l8, Revised, and this
notice, prescribe the terms of the Treasury bills and govern the
conditions of their issue. Copies of the circular may be obtained
from any Federal Reserve Bank or Braneh.

oOo

Treas.
HJ
10 '
•A13P4
v.113
Treas.
HJ
10
.A13P4

u.S TV~
Treasury Dept.
Press Releases

U.S. Treasury Dept.
Press Releases

v.113
DATE
LOANED

BORROWER'S NAME

PHONE
NUMBER

U.S. TREASURY LIBRARY

Full text of Press Releases of the United States Department of the Treasury : Volume 113

FRASER