Full text of Press Releases of the United States Department of the Treasury : Volume 72

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4,7 6
- 15 -

of rigid controls of our economy#

Even with such controls, sound fiscal

policy mma M dictate that any deficits be financed through mobilizing the
savings of the country, and particularly of individuals, insofar as that is
possible.

If resort must be had to the banks, the borrowing should beTl^t^.

short term, low yield obligations, such as bills and certificates, which
would be appropriate both from the standpoint of the cost to the Government
and their place in bank portfolios.
The task ahead in the administration of a sound and effective fiscal
policy is not an easy one.

To meet the^new situations that may develop,

we shall need skill and wisdom.

More than that, we shall need restraint on

the part of the business and banking community, on the part of labor, on
the part of Government, and on the part of the consuming public.

And all

of us will need»Divine guidance.
In our efforts to provide economic stability at home and abroad and
to utilize our resources for the high purposes of promoting world peace
and world prosperity, a common sacrifice lies ahead to protect this Nation
from any weakening of its economy and to guarantee that our great strength,
which is the hope of mankind, shall be preserved.

( ¿ lb
- 14 -

It should be fairly recognized^ lini'ffwuj% that if selling pressures
by 1

iholders of long term bonds are offset by no substantial

demand except that provided. by the Federal Reserve System and the Treasury,
the maintenance of the

long term rate will provide no flexibility for

the use of long term rates as an important factor in credit control.

This ,

brings us back to the big constant in the equation, the size of the public
debt, the cost of carrying it, its widespread ownership among millions of
individual owners, and its preponderant proportion in the assets of commercial
banks,

JfW

In the short term interest field, there is some greater latitude.

In

that area, financial and economic considerations permit a reasonable ad­
justment of that rate up or down as the needs develop.

It is a delicate

mechanism with vast potentials and should be used with great prudence and
keen understanding of the effect of every move.
Jn conclusion, I revert to the fbwmm consideration} of fiscal policy
as fft relate» to receipts and expenditures*
should have first place*

Broad economic considerations

It is inconceivable that we would take the risk

of placing on top of the inflationary pressures growing out of the financing
of the war new inflationary pressures that will grow out of deficit financing.
The dangers are too great.

The alternatives are, clear.

We must either make

up any differenceAthrough further taxation or resort to the straight-jacket

0

b

- 13 It has been argued that long term interest rates should be allowed
to seek their »natural»» level.

What is sometimes meant by the- natural level

is the determination made by the investment and money markets#

But this use

of the term »»natural»» adds little to the discussion* as the determinations
made by the money market are, for the most part, merely reflections of the
underlying credit policies of the monetary authorities.
However, Monetary authorities are not omnipotent#

In the long run,^

there is a real natural rate of interest, and a departure from this rate
will collect its own toll.

The natural rate of interest in this sense is

that rate which is high enough to hold down the amount of capital formation
to the currently accruing savings of the economy* yet low enough to permit
the savings made at a high level of employment to be fully invested.
A too-low rate of interest will, in the long run, encourage more capital
formation than can be financed by the current savings of the community.

The

difference will then be made up by an expansion of bank credit with a conse­
quent upward pressure on prices sufficient to compress consumption enough to
release the necessary resources.
On the other hand, a too-high interest rate will not permit as much
capital formation as the real savings of the community would make possible.
As a consequence, the community will not secure the benefits of all the
investments which it could otherwise have, and the labor and capital which
would have gone into creating these investments will be unemployed.
It is necessaiy, therefore, that the monetary authorities recognize the
long run economic limitations upon their powers.

JP M

E 1jliii

i,v$raeef natty
fthe/maj^r conf^P-lirt reason^Spr maintaining thgfpresent rite, ,At shout* \\
U |

*

*
*
\
ft; g
I /
;If **
a convincing l|il]L#f particulars bef|^;any consideration is giv^i

cMimng it.

jip
-

12

-

These bonds are payable upon presentation and demand,

A rise in interest rates

would be a wholesale invitation for cashing these bonds and would undermine the
confidence of the owners in their original investment.
The interest cost to Government on the public debt is $5*2 billion per
year, or $100 million per week.
for the fiscal year 1948,

This item represents 1U% of the Federal budget

Unless there is a substantial reduction in the debt,

the total interest cost will continue to rise.
One involves savings bonds.
maturity, is

2.9

There are two reasons for this.

The interest rate on E Savings Bonds, if held to

percent, but the interest charge on these bonds is carried in

the budget on the basis of the actual accrual each year.
accrual are graduated and they run up to 4*76 percent.

The bracket rates for
This top rate will be

reached on the largest blocks of savings bonds outstanding during the next two
or three fiscal years.

Second, the continued accumulation of trust funds is

invested, under statutory requirements, at an interest cost to the Government
up to 4$.

To the extent that these funds are used to retire short term, low

rate securities, the interest cost on the total debt will rise.

It is of

considerable importance to the taxpayer that the interest cost of the debt be
held to a minimum.
W ith interest rates on the Government debt the dominant factor in in­
fluencing all interest rates, any rise in long term rates on Government securities
would disturb private business in its long terra planning.
No one can predict today what the financing needs of Government may be in
the years ahead.

To destroy the integrity of the long term rate with which

World War Two was financed would multiply the difficulties in any large scale
financing that might be needed in the years ahead.
fact that, with the present debt, more than
year.

$50

Nor should we overlook the

billion must be refunded each

-

11

C o ') 6

-

There are several considerations that argue for the maintenance of the
long term 2-|% rate on Government securities.
Whether this rate is the correct one in terms of long-range worth of
long term money or not, it was the rate used in financing the war.

That rate,

and the market for securities based on that rate, and the liability of in­
stitutions that have acquired those assets based on that rate, have been
integrated into the financial structure of both public and
tutions throughout the nation.

private insti­

Commercial bank holdings of Government

securities are about seven tines their capital funds 5 the holdings of
Government securities by mutual savings banks are about six times their
reserves.

The holdings of Government securities by life insurance companies

pH f'Viequal noftgfty five times their capital funds.

.
The average maturity or

Government securities held by commercial banks is four years, by mutual
savings banks is thirteen years, and by life insurance companies, fifteen
years.

Any rise in interest rates of Government securities, with a conse­

quent decline in market value, would create a book loss against capital funds
of these institutions, multiplied by the raiio of Government bonds to capital
assets.

Ajfi.se to*
A.

term

1'

government secur-

ities would result in a market decline of all long term sepupitiqs that would
.JL*-*-*v
t / L1
create a book loss on assets held by U
total of their capital and capital reserves.

While such book losses

not be actually sustained, the existence of such.ieeee* in large proportions
might threaten the stability of many institutions.
An aggregate of
iduals.

billion savings bonds are held by millions of indiv-

These securities bear an interest rate to maturity from 2§$ to 2.9$.

-

10

Lol &

-

In the field of interest rates, there is but a limited area in which
debt management policy can operate.

Present rates on long term Government

bonds are practically at the coupon level of 2 ^ .

During the months of

March, April and May, 1947, there was an incipient boom in the bond market
with heavy pressures on the long term rate.

It was recognized, in the

interest of our national economy, that it was undesirable for long\term
money to become worth less and lesis.

There was a demand for the issuance

of new Government securities to meet investment demand.

In order to meet

this situation, the Treasury Department, over a period of six months, sold
long term bonds from some of its investment accounts to a net amount of
$$.^J^Dillion.

In September, 194-7, the Treasury Department offered a non-

market G-type bond to institutional investors under a limited formula,
resulting in sales of approximately $1 billion.

The effect of these oper­

ations was to take the pressure off the market and create the conditions
under which prices declined and interest rates moved up.

Thus was averted

the boom market in long term securities.
Following this period, the market pressures reversed themselves and
there developed instead an increasing downward pressure on prices and up-

of marketable Government bonds with a final maturity date of ten years or

/

more presently outstanding is only $64- billion out of the total debt of more
than

$250

billion.

(p

- 9 -

Revenue estimates for the fiscal year 1949 are based on personal
incomes of $200 billion for that period.

This is $3 billion more than the

total for the calendar year 1947 and is $11 billion less than the rate at
which such income payments .ran in the mopth of January, 1948.

I am fully

convinced that the base^ap*# is as realistic and as uncolored by desires
or objectives as reasonable men, using all available material and the
most scientific technique, can
On the expenditure side, costs that are products of war and defense
constitute 79$ of the Presidents budget.

There are few areas in this

group where expenditures may be reduced, but, on the other hand, there
appear to be potentials in which substantial increases may become the price
of self preservation.

In the other areas of the cost of Government, the

American people have shown little disposition to deny themselves services
that multiply the cost of Government.

There are some areas in which econ­

omies may be, and are being, effected, but, so long as the American people
demand of the Federal government vast operations and services, subsidies
and guarantees, substantial reductions in the cost of Government cannot be
had.
It has been suggested that, in order to improve the budget picture
for fiscal 1949, the sum of $3 billion for the foreign recovery program be
earmarked and charged against the
get.

1948

budget and credited to the

1949

bud­

The result is merely a bookkeeping transaction that would not affect

the time of receipt by the Government of a dollar of income nor the time of
payment of a dollar of expenditure.
there would be no effect at all.

From the standpoint of debt management,

111
Recognizing the strategic value of the sale
duals as a twnwnigfiiAWf-r4 against inflation that
spending stream and, at the same time, provide fu
retiring bank reserves and deposits of commercial
ment is instituting a new and accelerated Securit
beginning April 15th.

Enthusiastic support for t

tailers, insurance companies, laboi,r'"errgwjWMfttiaftg
industry, and.*others, assures an all-out effort.
I have used the President’s budget estimates
figures I have given.

Here and there, questions

whether these estimates, in some cases, may be tc
answer is that all estimates of the future are ne
cannot be proven facts.

They are as scientifica]

by as competent group of technicians as can be as
all known facts and the judgment of those in the
sound judgment in the financial field, in the bus
ment.

What the national income will be, what the

nation will total, what the national gross produc, --- ¡ M L ---1948, and June 30th, 1949, is not a slide rule determination on January 1st,
■
T
*
1948. Yet a determination mmk be made at that time of fat base on which to

r?~v

. ,.

it £

estimate Government revenues for the period\sixito eighteen months in advance.
With a Government budget equal to about 20% of total personal incomes and
with the Government revenues determined largely by the total of such incomes,
any variation in the base necessarily affects the actual revenue receipts.
With many new factors continuously arising that affect the base, the surprise
is not in how much the difference is between actual receipts and estimates
but how little.

■

6 ? ^

the Congress which, if it becomes law, will reduce the total rejenues^pf
the Federal government by more than 10 percent,

a (He-venues

during the fiscal

year ending June 30, 194-8, will be reduced by only about $600 mi 111 on j but
revenues for the fiscal year ending June 30, 1949, wi
$5 billion.

i

Adding to this $500 million, which will

t w additional tax refunds, the proposed tax reduction, based on present
budget estimates, would convert the expected surplus of $4.8 billion into a
deficit of $700 million.
Even on the earlier budget estimates, without consideration of reduced
receipts that will result from the proposed tax reduction and without any
consideration of increased expenditures beyond original*budget estimates for
military and economic preparedness, there wNak**»* no further budget surplus^
between April 1st and December 31st, 1948.
surplus ^

The next period of .possible»

in the first quarter of calendar 1949*

- 6 - *

4

ft/»

; Xt,
W

A
raw

u

¿PL

»gsofefc in commercial banks

approximate®^ $2 billion.

together -with cash receipts from the sale of savings bonds and net receipts
from trust funds, -will be available for debt management purposes and m i l be
used to continue the pressure on the money markets*
Throughout the current fiscal year, recognition has been given to the
wartime artificiality of the low rates on short term Government securities.

The task was to remove the rigidities of these artifical wartime rates with­
out serious disturbance to the money markets.

Through the cooperation of

the Treasury and the Federal Reserve System, the rates on 90-day bills were
permitted to move up, beginning with the issue of July 10, 1947.

Through

the issue of 7/8th percent certificates on August 1st, 1947, for an eleven
month maturity, an adjustment of the certificate rate was begun.

These

adjustments have continued until the 90-day bill rate is now approximately

1% and the one-year certificate rate is 1-l/Sths percent.

The effect of

these adjustments in rates has been consistent with the overall debt manage­
ment policy of the past year.
I have indicated that the budget surplus has been the most potent
weapon in debt management for the anti-inflationary objective.

This leads

to a brief discussion of the outlook for the fiscal year ending June 30th,
1949.

We start with the President’s budget estimate of a surplus for fiscal

’49 of |4.8 billion.

In view of world conditions, we would be unrealistic

if we failed to recognize the possibility that this surplus may be considerably
reduced through increased expenditures.

Furthermore, a tax bill has passed

of the excess of the cash operating surplus over the budget surplus.

The

inflationary pressures had increased during this period and, therefore,
the economic objective of an anti-inflationary debt management policy was
paramount.
For the fiscal year ending June 30th, 194S, there is an indicated
budget surplus of $7*5 billion.
for debt retirement.

This surplus has been, and is being, used

The Treasury also will receive about $lj billion from

the net sales of savings bonds and from other sources, making a total of
approximately $9 billion which will be available for the retirement of the
marketable debt.
high.

During thia perio^ inflationary pressures have continued

Therefore, in the d

o

f

stabilizing the economy, the use of

these funds (have)been directed toward a reduction of bank held debt, with
particular emphasis on the retirement of debt held by the Federal Reserve
banks•
Offsetting the impact of this program to a considerable extent has been
the non-bank selling of Government securities to the Federal Reserve banks
and the inflow of gold.

These factors have diminished the full anti-

inflationary effect of the debt management policy this year.

However, this

policy has,been of substantial effect on the credit structure, particularly
on long term interest rates of private and municipal credits, and in encourag­
ing a greater degree of caution in the lending field.
The present budgetary surplus s
surplus indicated on June 30th next.

t is greater than the net
However, an excess of expenditures in

the fourth quarter of the current fiscal year above
this amount to the $7,5 billion indicated in the bndw

/
0 , 1

»

- 4 -

In'February, 1946, at the highest point, the total Federal debt, direct
and guaranteed, -was $280 billions*
to $26 billions.

Cash balances of the Treasuiy amounted

The wartime interest pattern of the debt ranged from 3/8ths

of one percent on 90-day Treasury bills to

on long term Treasury bonds.

The distribution of the debt was $117 billions held by the commercial bank­
ing system, $65 billion held by individuals, $28 billion held in Government
trust accounts, and $70 billion held by other investors.

For the remaining

months of that fiscal year, to June 30th, 1946, there was a further deficit
in the Federal budget of over $l| billion.

There was a growing inflationary

pressure in our economy.
With these factors, the correct policy of debt management was clear.
It was to utilize the excess cash balance beyond budget needs for the retire­
ment of the debt.
banking field.

The proper place for such retirement was in the commercial

This policy was followed, with the result that by the end

of December, 1946, when cash balances had been brought down to a peacetime
working level, the total debt had been reduced by over $20 billion, of which
$19 billion were taken out of the commercial banking system.
We then moved into the second phase of postwar debt management.

From

January 1, 1947, through June 30, 1947, there was a budget surplus of approxi­
mately $3/4 billion. This represented the reduction of the public debt
I
which it was possible to achieve during this six-month period from an excess
of receipts over expenditures.

However, during this same period, it was

possible to reduce the holdings of the commercial banking system by $6
billion through the application of this surplus, through the use of the
proceeds from the sale of Savings Bonds to the public, and through the use

7 6

- 3 percent of total assets*

In the 1920's, the rate of interest on the public

debt was largely influenced by current financial and business conditions
and the rate on private debt; whereas today, the size and the proportion
of the Federal debt to the total of all debt makes it the dominating factor
in determining interest rates on private debt and the return on investments*
In the 1920!s, the public debt was only about 3/8ths of a year’js gross
national product; whereas, £n
^national product f^rraa.

-

the public debt cosooe&od the^gross
V

.m A

These figures and conparisons are unmistakable evidence of the impor­
tance of public debt management and of the compelling necessity for such
management to be directed not merely to the financial considerations of
Government itself, as important as they may be, but to the effect of such
management on our entire economy*

No matter how jealous we may be of the

»

freedoms of private enterprise, nor how abhorrent to our concept of such
freedom that control and management by central government may be, the hard
facts are that the management of our large public debt is such a dominant
factor in the financial and economic life of the Nation that it is imperative
that firm control of debt management be exercised by the Federal government.
This must continue as long as the public debt continues at its present
relative size and proportions. ^JJînahcial and business leadership should nerir*'
¡resi
4§y«few?8*

beconsîantîy aTert|èi» see*4*#,

that the exercise of that power is, at all times, directed toward the broad
objective of the national welfare*

y
percent of total assets* In the

193Q*b * the rate of interest on the public

debt erne lâfgaly influenced by current financial and business conditions
and the rate on private debtj whereas today, the S l w and the proportion
of the Federal debt to the total of all debt m k e s it the dominating factor

y

“

*

~

-

In the 1920*8, the public debt m n only about 3/8ths of a year1« gross
/ „
^
y
f
p M M j in 1947, the public debt exceeded the gross
national product for the year#*

i
these figures and cos^arison® are unmistakable evidence of the is^por-

tance of public debt eenegetemt and of the ecægmlling necessity for such
management to be directed not merely to the financial considerations of
Government itself, as is$ortant as they may be, but to the effect of such
management cm our entire eeonosy#

So matter tor jealous

m may be of the

freedoms of private enterprise, nor tor abhorrent to oar concept of each
freedom that control and management fey central government may be, the hard
facts are that the management of our large public debt la such a dominant
factor In the financial and economic life of the Ration that it is isperative
that firm control of debt management be exercised by the Federal government#
Ibis must continue as long as the public debt continues at its present
relative sise end proportions#

Financial and business leadership should not

resign Itself to accept any policy of debt managaiaent that Government night
desire to impose but, on the other hand, should be constantly alert to see
that the exercise of that power Is, at all tlaes, directed toward the broad
abjective of the national welfare*

i *1B
-

2

-

The condition of the American economy since VJ-Day indicated a fiscal
policy of seeking to keep expenditures as low as compatible with the dis­
charge of our domestic and international obligations and of seeking to keep
receipts as high as is consistent with a vigorously functioning private
enterprise economy and a reasonable untaxed minimum standard of living for
persons in the lower income brackets.

These objectives continue to call

for the maintenance of the present aggregate level of Federal tax revenues.
We would be blind to the stern realities of the hour if we failed to
recognize that rapidly changing world events are generating new variables
and new problems which will have a profound effect on our entire national
>K/jf

economy and on fiscal policy,

However, the limits of^time do not permit a

discussion of tax policy nor questions of expenditures as basic elements in
the determination of fiscal policies,

I shall limit my discussion to the

area of public debt management.
The number one constant in the equation of debt management is a present
federal debt in excess of $250 billionf.

The importance of this debt is

not merely its size but its proportion to the total of all debt, the impact
of its management on all interest rates, the cost of servicing the debt,
and proper provision for its retirement.
In the 1920*s, the public debt, both Federal and State and local,
amounted to a little over $30 billion and was less than 20$ of the total
public and private debt.

Today, the total public debt, Federal and local,

is about $270 billion and constitutes some 60 percent of the total of all
debt.

In the 1920*s, Government securities constituted about 12 percent

of the total assets of member banks; while today they constitute about 50

yty discussion tonight "will be devoted primarily to debt management as
a part of fiscal policy.

Overall fiscal policy is concerned -with the

desirable amount and sources of Government revenue and the amount and
uses of expenditures of the" Federal Government, nwfcip'iprtifc baset$ not only
o ^ financial but o £ economic considerations as well.
actual practice, the amount of receipts is often determined as much
by a consideration of what it is feasible to collect as it is by a broad
consideration oi^consumer and business incomes and the amount of goods
available for purchase.

The total amount of the Federal government’s

expenditures is often determined by other than economic considerations*
Our huge war expenditures were made in order to win the war and not because
the economy needed them$ and this is also true of the proposed expenditures
for the European Recovery Program*
It was not deemed feasible nor desirable for total receipts during
the war years to equal total expenditures.

On the other hand, when national

income and production are high, employment full, and inflationary pressures
strong, economic considerations should control, so as to produce a budget
surplus that may be applied toward economic stability and debt reduction.
The determination of the total amounts and the balance of receipts
and expenditures of the Federal government that is most conducive to a
healthy domestic economy should be the basic consideration of fiscal policy
in peacetime.

TREASURY DEPARTMENT
W ashington

^Address by A. L. M. Wiggins, U n d e r Secretary
of the Treasury, before the Acad e m y of
Political Science at the Hotel Astor, N e w
Y o r k City, April 1, 19^8^)

FOR RELEASE, MORNING NEWSPAPERS,
Friday, April 2, 19^8.___________

Press Servicá
No. S -676

TREASURY DEPARTMENT
Washington

(Address by A. L. M. Wiggins, Under Secretary
of the Treasury, before the -academy of Political
Science at the Hotel -astor, New York City,
April 1, 1948.)

FOR RELEASE, MORNING NEl’
/SPAPERS,
Friday, April 2, 1948.

Press Service

No. S-676

FISC vL POLICY- .ND DEBT MANAGEMENT
Ify discussion tonight will be devoted .primarily to debt management
as a part of fiscal policy. Overall fiscal policy is concerned with the
desirable amount and sources of Government revenue and the amount and
uses of expenditures of the Federal Government, on the basis not only of
financial but of economic considerations as well.
However, in actual practice, the amount of receipts is often determined
as much by a consideration of what it is feasible to collect as it is by
a broad consideration of consumer and business incomes and the amount of
goods available for purchase. The total amount of the Federal government’s
expenditures is often determined by other than economic considerations.
Our huge war expenditures were made in order to win the war and not because
the economy needed them; and this is also true of the proposed expenditures
for the E u r o p e ^ Recovery Program.
It was not deemed feasible nor desirable for total receipts during
the war years to equal total expenditures. On the other hand, when national
income and production are high, employment full, and inflationary pressures
strong, economic considerations should control, so as to produce a budget
surplus that may be applied toward economic stability and debt reduction.
The determination of the total amounts and the balance of receipts
and expenditures of the Federal government that is most conducive to a
healthy domestic oconomy should be the basic consideration of fiscal policy
in peacetime.
- . Tho condition of the American economy since VJ-Day indicated a fiscal
policy of seeking to keep expenditures as low as compatible with the dis­
charge of our domestic and international obligations and of seeking to
keep receipts as high as is consistent with a vigorously functioning
private enterprise oconomy and a reasonable unboxed minimum standard of
living for persons in the lower income brackets. These objectives continue
to call for the maintenance ot the present aggregate level of Federal tax
revenues.
Wo would be blind to the stern realities of the hour If we failed to
recognize that rapidly changing world events are generating now variables
and now problems which will have a profound effect on our entire national
economy and on fiscal policy. However, the limits of my time do not
permit a discussion of tax policy nor questions of expenditures as basic

- 2
elements in the detexmination of fiscal policies#
cussion to the area of public debt management*

I shall limit my dis­

The number one constant in the equation of debt management is a
present federal debt in excess of $250 billion.
The importance of this
debt is not merely its size but its proportion to the total of all debt*
the impact of its management on all interest rates, the post of servicing
the debt, and proper provision for its retirement*
In the 1920‘s, the public debt, both Federal and State and local,
amounted to a little over $30 billion and was less than 20# of the total
public and private debt. Today, the total public debt, Federal and local,
is about $270 billion and constitutes some 60 percent of the total of all
debt# In the 1920*s, Government securities constituted about 12 percent
of the total assets of member banks; while today they constitute about $0
percent of total assets#
In the 1920*s, the rate of interest on the public
debt was largely influenced by current financial and business conditions
and the rate on private debt; whereas today, the size and the proportion of
the Federal debt to the total of all debt makes it the dominating factor in
determining interest rates on private debt and the return on investments*
In the 1920*s, the public debt was only about 3/Sths of a yearfs gross
national product; whereas, in 1947, the public 'debt ‘oxcfcodbd the gross,
national product for the y..;ar**
These figures and comparisons are unmistakable evidence of the impor­
tance of public debt management and of the compelling necessity for such
management to be directed not merely to the financial considerations of
Government itself, as important as they may be, but to the effect of such
management on our entire economy. No matter how jealous we may be of the
freedoms of private enterprise, nor how abhorrent to our concept qf such
freedom that control and management by central government may be, the hard
facts are that the management of our large public debt is such a dominant
factor in the financial and economic life of the Nation that it is impera­
tive that firm control of debt management be exercised by the Federal
government* This must continue as long as the public debt continues at its
present relative size and proportions# However, financial and business
leadership should be constantly alert and fully cooperative in seeing that
the exercise of that power is, at all times, directed toward the broad
objective of the national welfare*
In February, 1946, at the highest point, the total Federal debt, direct
and guaranteed, was $280 billions. Cash balances of the Treasury amounted
to $26 billions.
The wartime interest pattern of the debt ranged from
3/8ths of one percent on 90-day Treasury bills to 2§# on long term Treasury
bonds* The distribution of the debt was $117 billions held by the
commercial banking system, $ 6$ billion held by individuals, $28 billion
held in Government trust accounts, and $70 billion held by other investors*
For the remaining months of that fiscal year, to June 30th, 1946, there was
a further deficit in the Federal budget of over $lj billion. There was a
growing inflationary pressure in our economy#
With these factors, the correct policy of debt management was clear*
It was to utilize the excess cash balance beyond budget needs for the

- 3 retirement of the debt* The pboper place for such retirement was in the
commercial banking field* Thi&. policy was followed, with the result that
by the end of December, 1946, when ca£h balances had been brought down to
a peacetime working level, the total debt had been reduced by over $ 2 0 .
billion, of which $19 billion were taken out of the commercial banking
system»
We then moved into the second phase of postwar debt management» From
January 1, 1947, through June 30, 1947, there was a budget surplus of
approximately $3/4 billion. This represented the reduction of the public
debt which it was possible to achieve during this six-month period from an
excess of receipts over expenditures» However, during this same period, it
was possible to reduce the holdings of the commercial banking system by $6
billion through the application of this surplus, through the use of the
proceeds from the sale of Savings Bonds to the public, and through the use
of the excess of the cash operating surplus over the budget surplus. The
inflationary pressures had increased during this period and, therefore,
the economic objective of an anti-inflationary debt management policy was
paramount.
For the fiscal year ending June 30th, 1948, there is an indicated
budget surplus of $7.5 billion. This surplus has been, and is being, used
for debt retirement. The Treasury also will receive about $1§ billion
from the net sales of savings bonds and from other sources, making a total
of approximately $9 billion which will be available for the retirement of
the marketable debt. During this period, inflationary pressures have con­
tinued high. Therefore, in the interest of stabilizing the economy, the
use of these funds has been directed toward a reduction of bank held debt,
with particular emphasis on the retirement of debt held by the Federal
Reserve banks»
Offsetting the impact of this program to a considerable extent has
been the non-bank selling of Government securities to the Federal Reserve
banks and the inflow of gold. These factors have diminished the full
anti-inflationary effect of the debt management policy this year» However,
this policy has been of substantial effect on the credit structure,
particularly on long term interest rates of private and municipal credits,
and in encouraging a greater degree of caution in the lending field.
The present budgetary surplus as of the end of March is greater than
the net surplus indicated on June 30th next. However, an excess of
expenditures in the fourth quarter of the current fiscal year above
receipts will reduce this amount to the $ 7»5 billion indicated in the
budget estimates. The deficit for this three-month period can be more
than offset*, however, with withdrawals from the Governments war loan
deposits in commercial banks now approximating $2 billion. These with­
drawals, together with cash receipts from the sale of savings bonds and net
receipts from trust funds y will be available for debt management purposes
and will be used to continue the pressure on the money markets.
Throughout the current fiscal year, recognition has been given to the
wartime artificiality of the low rates on short term Government securities.
The task was to remove the rigidities of these artificial wartime rates

— 4 rr
without serious disturbance to the money markets* Through the cooperation
of the Treasury and the Federal Reserve System, the rates on 90-day bills
were permitted to move up, beginning with the issue of July 10, 1947*
Through the issue of 7/8th percent certificates on August 1st, 1947, for
an eleven month maturity, an adjustment of the certificate rate was begun*
These adjustments have continued until the 90-day bill rate is now
approximately 1% and the one-year certificate rate is l-l/ 8ths percent#
The effect of these adjustments in rates has been consistent with the
overall debt management policy of the past year#.
X have indicated that the budget surplus has been the most potent
weapon in debt management for the anti-inflationary objective# This leads
to a brief discussion of the outlook for the fiscal year ending June 30th,
1949* We start with the President’s'budget estimate of a surplus for
fiscal *49 of $4*8 billion#
In view of world conditions, we would be un~
•realistic if we failed to recognize the possibility that this surplus may
be Considerably reduced through increased expenditures*
Furthermore, a
tax bill has passed the Congress which, if it becomes law, will reduce the
total revenues of the Federal government by more than 10 percent# Under
this legislation, revenues during the fiscal year ending June 30, 1948,
will be reduced by only about $600 million; but revenues for the fiscal year
ending June 30, 1949, will be reduced by about $5 billion* Adding to this
$500 million, which will be paid out in additional tax refunds, the proposed
tax reduction, based on present budget estimates, would convert the expected
surplus of $4 #8 billion into a deficit of $700 million.
Even on the earlier budget estimates, without consideration of reduced
receipts that will result from the proposed tax reduction and without any
consideration of increased expenditures beyond original budget estimates for
military and economic preparedness, there is indicated no further budget
surplus between April 1st and December 31st, 1948# The next period of sub­
stantial surplus will be in the first quarter of calendar 1949*.
For the full fiscal year 1949, with the currently proposed tax reduc­
tion and without any net increase in expenditures, there will be a rise in
the public debt of $700 million, and the only funds available for debt
management will be the cash receipts from trust funds and the receipts from
sales ef Savings Bonds in excess of the budget deficit*
If, therefore,
inflationary pressures continue through fiscal 1949, and if debt management
policy is to be continued with an anti-inflationary objective, the ammuni­
tion will be severely limited*
It is, therefore, highly important in the
year ahead that a maximum effort should be devoted to the sale of Savings
Bonds to non-bank holders, so as to provide the greatest possible amount of
funds to be used in maintaining reasonable pressure on the credit situation*
Recognizing the strategic value of the sale of Savings Bonds to indivi­
duals as a dual purpose weapon against inflation that will divert cash
from the spending stream and, at the same time, provide funds which may be
used in retiring bank reserves and deposits of•commercial banks, the
Treasury Department is instituting a new and accelerated Security Savings
Bond Campaign, beginning April 1 5th* Enthusiastic support for the program
by industrial concerns, labor organizations, bankers, retailers, insurance
companies, the entire advertising industry, and many others, assures an
all—out effort#

- 5 I have used the Presidents budget estimates as the basis of all the
figures I have given. Here and there, questions have been raised as to
whether these estimates, in some c&ses, may be too low or too high. The
answer is that all estimates of the future are necessarily estimates ; they
cannot be proven facts. They are as scientifically prepared as is possible,
by as competent group of technicians as can be assembled, and are based
upon all known facts and the judgment of those in the best position to form
a sound judgment in the financial field, in the business field, and in
Government. 'What the national income will be, what the personal incomes
for the nation will total, what the national gross product will be between
July 1st, 1948, and June 30th, 1949, is not a slide rule determination on
January 1st, 1948. let a determination had to be made at that time of a
base on which to estimate Government revenues for the period six to
eighteen months in advance. With a Government budget equal to about 20$
of total personal incomes and with the Government revenues determined
largely by the total of such incomes, any variation in the base necessarily
affects the actual revenue receipts* With many new factors continuously
arising that affect the base, the surprise is not in how much the difference
is between actual receipts and estimates but how little.
Revenue estimates for the fiscal year 1949 are based on personal
incomes of $200 billion for that period. This is $3 billion more than the
total for the calendar year 1947 and is $11 billion less than the rate at
which such income payments ran in the month of January, 1948.
I am fully
convinced that the base of $200 billion is as realistic and as uncolored
by desires or objectives as reasonable men, using all available material
and the most scientific technique, can determine.
On the expenditure side, costs that are products of war and defense
constitute 79$ of the President’s budget* There are few areas in this
group where expenditures may be reduced, but, on the other hand, there
appear to be potentials in vhich.substantial increases may become the
price of self preservation*
In the other areas of th? cost of Government,
the American people have shown little disposition to deny themselves
services that multiply the cost of Government* There are some areas in
which economies may be, and are being, effected, but, so long as the
American people demand of the Federal government vast operations and
services, subsidies, and guarantees, substantial reductions in the cost of
Government cannot be had. .
It has been suggested that, in order to improve the budget picture
for fiscal 1949, the sum of $3 billion for the foreign recovery program
be earmarked and charged against the 1948 budget and credited to the 1949
budget. The result is merely a bookkeeping transaction that would not
affect the time of receipt by the Government of a dollar income nor the
time of payment of a dollar of expenditure*
From the standpoint of debt
management, there would be no effect at all*
In the field of interest rates, there is but a limited area in which
debt management policy can operate. Present rates on long term Government
bonds are practically at the coupon level of 2§$. During the months of .
March, April and May, 1947, there was an incipient boom in the bond
market with heavy pressures on the long term rate.
It was recognized, in
the interest of our national economy, that it was undesirable for long

- 6 term money to become worth less and less. There was' a demand for the
issuance of new Government securities to meet investment demand.
In order
to meet this situation, the Treasury Department, over a period of six
months, sold long term bonds from some of its investment accounts to a net
amount of $1,5 billion*
In September, 194-7, the Treasury Department
offered a non-market G-type bond to institutional investors under a limited
formula, resulting in sales of approximately $1 billion. The effect of
these operations was to take the pressure off the market and create the
conditions under which prices declined and interest rates moved up. Thus
m s averted the boom market in long term securities#
Following this period, the market pressures reversed themselves and
there developed instead an increasing downward pressure on prices and
upward pressure on rates. The 2Jjg long term rate was then stabilized
through purchases in the market by the Treasury and the Federal Reserve
banks. At present, there appears to be a relative equilibrium in the long
term market.
It should be well recognized that there is no question of the finan­
cial adequacy of the Federal Reserve System and the Treasury to maintain
the market and the rate and to buy all of the securities that may be re­
quired for that purpose.
The total amount of marketable Government bonds
with a final maturity date of ten years or more presently outstanding is
only $64 billion out of the total debt of more than $250 billion.
There are several considerations that argue for the maintenance of the
long term
rate on Government securities*
Whether this rate is the correct one in terms of long-range worth of
long term money or not, it was the rate used in financing the war. That
rate, and the market for securities based on that rate, and the liability
of institutions that have acquired those assets based on that rate, have
been integrated into the financial structure of both public and private
institutions throughout the nation. Commercial bank holdings of Government
securities are about seven times their capital funds; the holdings of
Government securities by mutual savings banks are about six times their
reserves. The holdings of Government securities by life insurance companies
equal more than five times their capital funds. The average maturity of
Government securities held by commercial banks is four years, by mutual
savings banks is thirteen years, and by life insurance companies, fifteen
years. Any rise in interest rates of Government securities, with a conse­
quent decline in market value, would create a book loss against capital
funds of these institutions, multiplied by the ratio of Government bonds
to capital assets. A small rise in the interest rate of long term
government securities would result in a market decline of all long term
securities that would create a book losé on assets held by many such
institutions equal to the total of their capital and capital reserves.
While such book losses would not be actually sustained, the existence of
such market valuation shrinkage in large proportions might threaten the
stability of many institutions.
An aggregate o f ‘$46 billion savings bonds are held by millions of
individuals. These securities bear an interest rate to maturity from
to 2.9$. These bonds are payable upon presentation and demand, A

- 7 ris© in interest rates would be a wholesale invitation for caching these
bonds and would undermine the confidence of the owners in their original
investment*
The interest cost to Government on the public debt is $5.2 billion
per year, or $100 million per week* This item represents 1U% of the^
Federal budget for the fiscal year 194-8* Unless there is a substantial
reduction in the debt* the total interest cost will continue to rise*
There are two reasons for this# One involves savings bonds*
The interest
rate on E Savings Bonds, if held to maturity, is 2,9 percent, but the
interest charge on these bonds is carried in the budget on the basis of the
actual accrual each year.
The bracket rates for accrual are graduated and
they run up to 4*76 percent.
This top rate will be reached on the largest
blocks of savings bonds outstanding during the next two or three fiscal
years* Second, the continued accumulation of trust funds is invested,
under statutory requirements, at an interest cost to the Government up to
¿S* To the extent that these funds are used to retire short term, low
rate securities, the interest cost on the total debt will rise.
It is of
considerable importance to the taxpayer that the interest cost of the debt
be held to a minimum*
With interest rates on the Government debt the dominant factor in in-^
fluencing all interest rates, any rise in long term rates on Government
securities would disturb private business in its long term planning*
No one can predict today what the financing needs of Government may
be in the years ahead. To destroy the integrity of the long term rate
with which World War Two was financed would multiply the difficulties in
any large scale financing that might be needed in the years ahead* Nor
should we overlook the fact that, with the present debt, more than $50
billion must be refunded each year.
It has been argued that long term interest rates should be allowed
to seek their “natural 11 level* What is sometimes meant by the natural
level is the determination made by the investment and money markets*
But
this use of the term “natural“ adds little to the discussion, as the
determinations made by the money market are, for the most part, merely
reflections of the underlying credit policies of the monetary authorities*
However, monetary authorities are not omnipotent.
In the long run,
there is a real natural rate of interest, and a departure from this rate
will collect its own toll. The natural rate of interest in this sense is
that rate which is high enough to hold down the amount of capital forma­
tion to the currently accruing savings of the economy, yet low enough to
permit the savings made at a high level of employment to be fully invested.
A too-low rate of interest will, in the long run, encourage more
capital formation than can be financed by the current savings of the
community.
The difference will then be made up by an expansion of bank
credit with a consequent upward pressure on prices sufficient to compress
consumption enough to release the necessary resources*
On the other hand, a too-high interest rate will not permit as much
capital formation as the real savings of the community would make

-

8

-

possible* As a consequence, the community will not secure the benefits
of all the investments •which it could otherwise have, and the labor and
capital which would have gone into creating these investments will be
unemployed#
It is necessary, therefore, that the monetary authorities recognize
the long run economic limitations upon their powers*
It should be fairly recognized that if selling pressures by holders
of long term bonds are offset by no substantial demand except that pro­
vided by the Federal Reserve Syste m a n d the Treasury, the maintenance of
the 2^$ long term rate will provide no flexibility for the use of long
term rates as an important factor in credit control. This brings us
back to the big constant in the equation, the size of the public debt,
the cost of carrying it, its widespread ownership among millions of
individual owners, and its preponderant proportion in the assets of
commercial banks, savings banks, trust funds, insurance companies, and
other institutions*
These considerations must continue to control the
determinations of public debt management policy*
In the short term interest field, there is some greater
In that area, financial and economic considerations permit a
adjustment of that rate up or down as the needs develop#
It
mechanism with vast potentials and should be used with great
keen understanding of the effect of every move#

latitude#
reasonable
is a delicate
prudence and

In conclusion, I revert to basic considerations of fiscal policy as
they relate to receipts and expenditures,
Broad economic considerations
should have first place.
It is inconceivable that we would take the risk
of placing on top of the inflationary pressures growing out of the financing
of the war new inflationary pressures that will grow out of deficit financ­
ing. The dangers are too great.
The alternatives are clear* We must
either make up any difference between receipts and expenditures through
further taxation or resort to the straight-jacket of rigid controls of our
economy. Even with such controls, sound fiscal policy dictates that any
deficits be financed through mobilizing the savings of the country, and
particularly of individuals, insofar as that is possible*
If resort must
be had to the/banks, the borrowing should be through short term, low yield
obligations, such as bills and certificates, which would be appropriate
both from the standpoint of the cost to the Government and their place in
bank portfolios*
The task ahead in the administration of a sound and effective fiscal
policy is not an easy one* To meet the current and the new situations that
may develop, we shall need skill and wisdom* More than that, we shall
need restraint on the part of the business and banking community, on the
part of labor, on the part of Government, and on the part of the consuming
public. And all of us will need and should seek Divine guidance.
In our efforts to provide economic stability at home and abroad and *
to utilize our resources for the high purposes of promoting world peace
and world prosperity, a common sacrifice lies ahead to protect this Nation
from any weakening of its economy and to guarantee that our great strength,
which is the hope of mankind, shall be preserved#

The/ri4>gram for the remainder of the week follows:
WEDNESDAY:

»Purchase Methods & Procedures*» Discussion led by
F. Carl Anderson, Director of Purchases, Commonwelath
Pennsylvania*
»Purchase Contracts«» By Nelson Rosenbaum, Counselorat-Law, New York City«

THURSDAY :

»Inspection«»

Led by Captain R«M« Watt, Jr« USN»

’Warehousing#» 'Led by Albert Pleydell, General Manager,
/ I Health Insurance Plan of Greater New York

\ ¥y
FRIDAY :

»Accounting & Paying«» Discussion by Miner B« Phillips,
Executive Director, Municipal Finance
Officers Association of The U«S« & Canada

SATURDAY:

»Standards»

Discussion by Col« B«L* Neis, USA, and
Willis S. MacCleod, Deputy Director,
Standards Branch, Bureau of Federal Supply,

»General Purchasing«»

Discussion led by W«Z® Betts

-r •

-

2-

67?

Mr* Mack emphasized that while the Bureau of Federal Supply is
sponsoring the new organization, and is making its facilities available
to it, the National Academy for Public Purchasing "is not a government
agency and does nob belong to the Federal Government."

He said the

new organization "belongs to the men who compose it, but Federal
sponsorship was deemed" advisable since the Government has so tremendous
a stake in the efficient conduct of public purchasing."
An Advisory Committee, composed of eight outstanding figures in
government, industry aid educational institutions was named last month
to advise on policy.

It is hoped that regular sessions can be held

at intervals during the year, in which an even greater number of pur­
chasing men across the country can attend.

Certificates of participation

are to be awarded t o those attending the major sessions.
After Secretary Snyder has opened the session, the Monday meeting
will be conducted by Joseph W. Nicholson, Purchasing Agent for the
City of Milwaukee.

Mr. Nicholson will discuss the "Organization for

Purchasing, Stores and Distribution in a G o v e m m e n t ^ t a b l i s h m e n t . "
Tuesday sessions will include a discussion of "Determination of
Requirements", led by Louis J. Cook, Superintendent of School Supplies
for New York City.

Read Admiral M.L.Ring, USN, will discuss "Estab­

lishing Sources of Supply.”
Among those consulted and who assisted in laying plans for the
seminar were Mr. George J. Cronin, Commisioner and Purchasing Agent
for the Commonwealth of Massachusetts; Mr. Franklyn A. Adams, State
Purchasing Agent of Rhode Island, and Mr. Betts of North Carolina.

TR EA SU R Y DEPARTMENT
BUREAU OF FEDERAL SUPPLY
Washington 25
O F F IC E O F T H E D IR E C T O R

<;

-

(

FOR RELEASE TO SUNDAY PAPERS, APRIL h* 194$

Approximately fifty outstanding purchasing specialists representing
cities, States and the Federal Government will convene in Wash'

Purchasing#
The Academy, originated by a suggestion from W#Z# Betts, Director
of Purchases for the State of North Carolina, is sponsored by the Bureau
of Federal Supply#

The first meetings will consist of a week-long seminar

on various technical phases of public purchasing#

For the first time there

will be established an organization devoted exclusively to the exchange
of information and techniques on the subject of purchasing for government
at every level#
Secretary Snyder will welcome the Academy members in a short speech
at twelve-thirty at the Bureau of Federal Supply offices, where the seminar
is to be held*
According to interim chairman Clifton E. Mack, Director of the Bureau
of Federal Supply, the six day sessions will include studies of "every
major facet of the supply operation.

Outstanding public purchasing men

will lead the discussions with the result that all of us, whether repre­
sentatives of cities, States or the Federal Government will have the benefit
of the best experience in the exceedingly responsible job of spending

ref'
s money for supplies and, equipment used in Government *’1
taxpay
ers

Mardh 31

Mr, Shaeffer:

Attached release has been approved by Mr. H.M.
Kurth, Assistant Director. We request it be put out for use
Sunday, and we would like 40 copies as soon as duplicated.
There is a possibility the trade press will want
more info; inquiries should be directed to Mr. Kurth, Extension
601. Also, if inquiries cone to you, the trade press is cordially
invited to any o r all of the sessions*

Murray

TREASURY DEPARTMENT
Bureau of Federal Supply
Washington
FOR RELEASE SUNDAY NEWSPAPERS,
April 4, 1948________________

Press Service
No. S-677

Approximately fifty outstanding purchasing specialists
representing cities, States and the Federal Government will
convene in Washington tomorrow for the opening sessions of the
National Academy for Public Purchasing.
The Academy, originated by a suggestion from W. Z. Betts,
Director of Purchases for the State of North Carolina, is
sponsored by the Bureau of Federal Supply. The first meetings
will consist of a week-long seminar on various technical phases
of public purchasing. For the first time there will be established
an organization devoted exclusively to the exchange of informa*
tion and techniques on the subject of purchasing for government
at every level.
Secretary Snyder will welcome the Academy members in a
short speech at twelve-thirty at the Bureau of Federal Supply
offices, where the seminar is to be held.
According to interim chairman Clifton E . Mack, Director of
the Bureau of Federal Supply, the six day sessions will include
studies of "every major .facet of the supply operation. Out­
standing public purchasing men will lead the discussions with
the ^result that all of us, whether representatives of cities,
States or the Federal Government will have the benefit of the
best experience in the exceedingly responsible job of spending
taxpayers' money for supplies and equipment used in Government."
Mr. Mack emphasized that while the Bureau of Federal Supply
is sponsoring the new organization, and is making its facilities
available to it, the National Academy for Public Purchasing
"is not a government agency and does not belong to the Federal
Government. ' He said the new organization "belongs to the men
who compose it, but Federal sponsorship was deemed advisable
since the Government has so tremendous a stake in the efficient
conduct of public purchasing."
An Advisory Committee, composed of eight outstanding
figures in government, industry and educational institutions was
named last month to advise on policy. It is hoped that regular
sessions can be held at intervals during the year, in which
an even greater number of purchasing men across the country can
attend. Certificates of participation are to be awarded to
those attending the major sessions.

2
After Secretary Snyder has opened the session, the Monday
meeting ■will he conducted by Joseph ¥, Nicholson, Purchasing
Agent for the City of Milwaukee. Mr. Nicholson will discuss
the■"Organization for Purchasing, Stores and Distribution in
a Government Establishment.’' Tuesday sessions will include a
discussion of "Determination of Requirements", led by Louis J.
Cook, Superintendent of School Supplies for New York City.
Rear Admiral M. X* Ring, USN, will discuss "Establishing Sources
of Supply."
Among those consulted and who assisted in laying plans for
the seminar were Mr. George J. Cronin, Commissioner and Purchas­
ing Agent for the Commonwealth of Massachusetts; Mr. Pranklyn A.
Adams, State Purchasing Agent of Rhode Island, and Mr. Betts of
North Carolina.
The program for the remainder of the week follows:
WEDNESDAY:

"Purchase Methods & Procedures." Discussion
led by P. Carl Anderson, Director of Purchases,
Commonwealth of Pennsylvania.
"Purchase Contracts." By Nelson Rosenbaum,
Counselor-at-law, New York City.

THURSDAY:

"Inspection."
USN.

Led by Captain R. M. Watt, Jr.

"Warehousing," Led by Albert Pleydell, General
Manager, Health Insurance Plan of Greater
New York.
FRIDAY:

"Accounting & Paying." Discussion by Miner B.
Phillips, Executive Director, Municipal Pinance
Officers Association of the U.S. & Canada.

SATURDAY:

"Standards.” Discussion by Col. B. L. Neis, USA,
and Willis S. MacCleod, Deputy Director, Standards
Branch, Bureau of Federal Supply.
"General Purchasing."
0O0

Discussion led by W.Z. Bettr

- 1* 6
♦
•
•
»

Recoveries:
On securities....................... .
On loans*.............................

1947

•
i

?

^

1946

î Change since
:
1946

25,571
**3.629
29.991
99.191
61.421

104,139
110.518

29.010

- 8,245
+ 2,316
+
981
- 4,94s
-**9.097

. SECURITIES SOLD OR REDEEMED......
Losses and charge-offs:
On securities............ ............
On loans................. ......... . ••
All o
t
h
e
r
^
TOTAL LOSSES AND CHARGrE-OFBS......
PROPITS BEFORE IHCOME TAXES..............
Taxes on net income:
Federal...............................
State.................... ........ .
TOTAL TAXES OH HET IHCOME.........
NET PROFITS BEFORE DIVIDENDS.............
Dividends declared:
On preferred stock................ .
On common stock:
Cash dividends.............. ......
Stock dividends................... .
TOTAL DIVIDENDS DECIAEED.........

160,612

214,657

-54,045

74,620
36.569
155,709
680,890

- 4,835
+29,022
-10.930
+13,257
-45,150

452.933

174,454
11.538
185,992
494,898

- 1,840
- 1,395
- 3,235
-41,915

1,372

2,427

- 1,055

182,147
23,**90

167,702

206,969

2S.165
198,29**

+14,445
- 4,715
+ 8,675

Number of hanks If..... ..................

5,011

5,013

2

TOTAL RECOVERIES.................
Profits on securities sold or redeemed.....

33,816
**1.313

t o t a l r e co v e r i es a n d p r o f i t s o h

Rate
To
Rate
To

of net profits:
capital fonds If....................
of cash dividends:
capital funds 1)....................

l/ At end of period«

69,785
73,542
25.639
168,966
635,7*»
172,614
10.143
182,757

Percent

44,520

_

Percent

Percent

8.36

9.61

-

1.25

3.39

3.30

+

.09

SOWINGS, EXPENSES, AND DIVIDENDS 0? NATIONAL BANKS POR TSARS
ENDED DECEMBER 31, 1947 and 1946
(Amounts in thousands of dollars)

;
:

1947

?
î

Capital stock, -par value: 1/
Preferred............ 7 ..................
$27,4*10
Common..*................................. 1.752.*109
TOTAL CAPITAL STOCK......... ......... 1.779.849
Capital funds 1/............................. 5,421,324
Earnings from current operations:
Interest and dividends:
On U# S, Government obligations......
On other securities.................
Interest and discount on loans.........
Service charges on deposit accounts....
Other service charges, commissions, fees
and collection and exchange charges...
Trust department.................... ..
. Other current earnings................
TOTAL EARNINGS PROM CURRENT
OPERATIONS......................

Current operating expenses;
Salaries and wages:
Officers............................
Baployees other than officers.......
Pees paid to directors and members of
executive, discount, and advisory
committees..... ......... ...........
Interest on time deposits (including
savings deposits)............. .....
Taxes other than on net income..........
Recurring depreciation on banking house,
furniture and fixtures..............
Other current operating expenses........
TOTAL CURRENT OPERATING EXPENSES___
NET EARNINGS PROM CURRENT OPERATIONS

1946

: Change since
:
19I16

$4lJ89
1,714.982
1.75b1771
5.1*9.799

- 14,349
4» 37.427
4» 257Ô7S
+271,525

701,612
102,bl4
907,212
69,387

- 81,081
+ 2,90b
*199,107
+ 13,955

52,766
50,399
89.52*1

+
500
+ 4,664
+ 11.669

i , 7 2 M 3 “+ 1 .5 7 3 ,5 1 *

+151,320

620,531
105,120
706,319
« 3,3*2
53.266
55,063
101.193 .

178.35*
333.1*3

158,789
284,834

9,182

8,206

163,286
59,071

1*4,514
5*.319

2*,1*6
313.558
1,080.740
644,094

23,265
277.6*5
951.572
621,942

+ 19.565
+ *8,309
+

976

+ 18.772
+ *,752
+
881
.. * 35,913 __
+129.168
+ 22,152

-

2

-

of
19^6.

Taxes on net income, Federal and State, in the year 19^7» totaling

$183,000,000, were $3*000,000 less than the amount of such taxes paid in

19**6 .

Cash dividends declared on common and preferred stock in 19^7 totaled
$18^,000,000, in comparison with $170,000,000 in 19^6«
dividends was 3*39 percent of capital funds.

The annual rate of cash

The cash dividends to stockholders

in 19^7 were *10.51 percent of the net profits available for the year.
maining

The re­

59,^9 percent of net profits, or $ 269,000,000, was retained by the banks

J

in their capital funds.
On December
to

31» 19^7 there were 3,011 national banks in operation as compared ]

5,013 at the end of 19^6#

1

TREASURY DEPARTMENT
Comptroller of the Currency
Washington
Pre8f “I— ¡T

No.

Controller of the Currency Preston Delano announced today that the national
hanks in the United States and possessions reported net profits after income taxes

of $**53,000,000, a decrease of nearly $**2,000,000 in the amount reported for I9U6,
Net operating earnings before income taxes were $6****,000,000, an increase of
$22,000,000 in the year.

Adding to the net operating earnings, profits on securi­

ties sold of $62,000,000 and recoveries, etc., previously charged off of
$99,000,000,and deducting therefrom losses and chargeoffs of $169,000,000 and taxes
on net income of $183,000,000,the net profits before dividends for the year

19**7

amounted to the $^53,000,000 mentioned above, which at an annual rate amounts to

8.36 percent of capital funds.
The principal items of operating earnings for

19**7 were $621,000,000 from

interest on United States Government obligations and $105,000,000 interest and divi­
dends on other securities, a total of $726,000,000, which was a decrease of
$78,000,000 in the figures reported for

19U6; and interest and discount on loans

of $706,000,000, an increase of $199,000,000.

The principal operating expenses

were $521,000,000 for salaries and wages of officers and employees and fees paid
to directors, an increase of $69,000,000 over

19**6, and $163,000,000 expended in

the form of interest on time and savings deposits, an increase of $19,000,000. Gross
earnings from current operations in
$151,000,000 over the previous year.
against $952,000,000 in

19**7 were $1 ,725,000,000, an increase of
Operating expenses were $1,081,000,000 as

19H6.

Profits on securities sold in 19**7 amounting to $62,000,000, or $**9,000,000
less than in the preceding year, and losses and depreciation on securities in
totaling $70,000,000 were nearly $5,000,000 less than in the year before.

19**7

Losses

charged off on loans and discounts of $7**,000,000 were $29,000,000 more than in

TREASURY DEPARTMENT
Comptroller of the Currency
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Saturday, April 3, 1948.

Press Service
No. S - 6 7 8

Comptroller of the Currency Preston Delano announced today
that the national banks in the United States and possessions
reported net profits after income taxes of $453,000,000, a de­
crease of nearly $42,000,000 in the amount reported for 1946,
Net operating earnings before income taxes were $644,000,000,
an increase of $22,000,000 in the year. Adding to the net
operating earnings, profits on securities sold of $6 2 ,0 0 0 ,0 0 0
and recoveries, etc,, previously charged off of $9 9 ,0 0 0 ,0 0 0 and
deducting therefrom losses and chargeoffs of $ 1 6 9 ,0 0 0 ,0 0 0 and
taxes on net income of $ 1 8 3 ,0 0 0 ,0 0 0 , the net profits before
dividends for the year 1 9 4 7 amounted to $453,000,000 mentioned
above, which at an annual rate amounts to 8 .3 6 percent of
capital funds.
/ The principal items of operating earnings for 1947 were
$621,000,000 from interest on Uhited States Government obligations
and $1 0 5 ,0 0 0 ,0 0 0 interest and dividends on other securities, a
total of $ 7 2 6 ,0 0 0 ,0 0 0 , which was a decrease of $7 8 ,0 0 0 ,0 0 0 in
the figures reported for 1946; and interest and discount on loans
of $706,000,000, an increase of $199,000,000. The principal
operating expenses were $ 5 2 1 ,0 0 0 ,0 0 0 for salaries and wages cf
officers and employees and fees paid to directors, an increase of
$6 9 ,0 0 0 ,0 0 0 over 1946, and $ 1 6 3 ,0 0 0 ,0 0 0 expended in the form of
interest on time and savings deposits, an Increase of $19,000,000.
Gross earnings from current operations in 1947 were $1,725,000,000,
an increase of $151,000,000 over the previous year. Operating
expenses were $ 1 ,0 8 1 ,0 0 0 ,0 0 0 as against $9 5 2 ,0 0 0 ,0 0 0 in 1 9 4 6 .
Profits on securities sold in 1947 amounting to $62,000,000,
or $49,000,000 less than In the preceding year, and losses and
depreciation on securities in 1947 totaling $7 0 ,0 0 0 ,0 0 0 were nearly
$5,000,000 less than in the year before. Losses charged off on
discounts of $74,000,000 were $29,000,000 more than In
1946. Taxes on net income, Federal and State, in the year 1947,
totaling $183,000,000, were $ 3 ,0 0 0 ,0 0 0 less than the amount of
such taxes paid in 1946,
Cash dividends declared on common and preferred stock In
1947 totaled $184,000,000, In comparison with $ 1 7 0 ,0 0 0 ,0 0 0 in
194b. The annual rate of cash dividends was 3 * 3 9 percent of
pitaifunds. The cash dividends to stockholders in 1947 were 40.51 percent of the net profits available for the year. The re­
maining 5 9 4 9 percent of net profits, or $2 6 9 ,0 0 0 ,0 0 0 , was retained
by the banks in their capital funds.
On December 31, 1947 there were 5,011 national banks in
operation as compared to 5,013 at the end of 1946.

-2

-

EARNINGS, EXPENSES, AND DIVIDENDS OF NATIONAL BANKS FOR YEARS
ENDED DECEMBER 31, 1947 and 1946
(Amounts in thousands of dollars)

:
:

Capital stock, par value: i/
Preferred nooooooooooooooeoooooooooooooooooooe
Commono o o q o o o o o o o o o o o o o o q o o o o o o o o o o o o q '
o oooooo
TOTAL CAPITAL STOCK©oooooooooooooooooo
Capital funds

Earnings from current operations:
Interest and dividends:
On Uo S» Government Ofcligationsoooooooo o o
On

O ther

oo

S 6 C U n .t2 .e S o p o o o o o o o oooooo ooooo o o o o

1947

t 27,440
1.752.409
1.779.849
5,421,324

620,531
105,120
706,319
83,342

:
:

1946

$ 41,789
14,349
1.714.982 A 37.427
1.756.771 A . 23.078
5,149,799 / 2 7 1,5 2 5

701,612
102,614
507,212
69,387

Interest and discount on loans0oooooooooo o o o
Service charges on deposit accounts0oo©oo 0 0 0 9
Other service charges, commissions, fees
and collection and exchange charges0ooo o o o o
53,266
52,766
Trust departmentooooooooooooooooooooooooo oooo
55,063
50,399
Other current earningsooooooooooooooooooo OOOo
101.193 ..39,524
TOTAL EARNINGS FROM CURRENT
OPERATIONS ooooooooooooooooooooooooo
1,724,834 1,573,514
0

Current operating expenses:
Salaries and wages:
OffXCerSOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO
Employees other than officersCooooooooooooo
Fees paid to directors and members of
executive, discount, and advisory
committees ooooooooooooooooooooooooooooooooo
Interest on time deposits (including
deposits )oooooooooooooooooooooooooo
Taxes other than on net income0oooooooooo©©oo
Recurring depreciation on banking house,
furniture and fixtureso©ooooooooooooooooooo
Other current operating expenses0ooooo©oooooo

: Change since
:
1946

81,081
2,506
/
/ 199,107
/ 13,955
•M

/
/
/

500
4 ,664
11.669

/ 151,320

178,354
333,143

158,789
284,834

/
/

19,565
48,309

9,182

8,206

/

976

163,286
59,071

3.44, 514
54,319

f
/

18,772
4,752

2 4 ,14 6

23,265

313,558

277,645

/
/

881
35,913

TOTAL CURRENT OPERATING EXPBNSESooooooooo 1.080.740
NET EARNINGS FROM CURRENT OPERATIONSoooooooooooo
644.094

951.572 /: 12 9 .16 8
621.942 A . 22.152

- 3 -

:

1947

:

1946

:Change since
: '•
1946

Recoveries:
25,571
43,629
¿§'991

33,316
41, 313
29,010

99,191
&L, 421

104,139
110,518

- 8,245
/ 2,316
/
981
- 4,948
-49,097

160,612

214,657

-54,045

#,785
'73,542
¡25,639

74,620
44,520
36,569

- 4,835
/29,022
-10,930

$68,966
¿35,740

155,709
680,890

A 3 ,2 5 7
-4 5 ,15 0

172,614
10,143
TOTAL TAXES ON NET INCOME......... . 182,757
NET PROFITS BEFORE DIVIDENDS.............. . 452,983
Dividends declared:
Oh preferred stock.....................
1,372
On common stock:
Cash dividends........... ........... . 182,147
Stock dividends...................... .
23,450

174,454
11,538
185,992
494,898

- 1,8 4 0
- 1,395
- 3,235
-41,915

2,427

- 1,055

167,702
28,165

On securities........... .............. ..
Qn "1nans............................... .
All other........ .......... *.......... .
TOTAL RECOVERIES................. ..
Profits on securities sold or redeemed•... ..
TOTAL RECOVERIES AND PROFITS CN
SECURITIES SOLD OR REDEEMED..... .
Losses and charge-offs:
On securities........................... .
On loans............................... .
All other............................... .
TOTAL LOSSES AND CHARGE-OFFS...... .
PROFITS BEFORE INCOME TAXES............... .
Taxes on net income:
Federal................................. .
State...... ............................

TOTAL DIVIDENDS DECLARED.......... .
Number of banks l/........................

Rate
To
Rate
To

of net profits:
capital funds' 1/............ '......... .
of cash dividends:
capital funds l/...................... .

1/ At end of period

206,969

198,294

/14,445
- 4,715
/ 8,675

5,011

5,013

2

Percent
8.36

Percent
9.61

3.39

3.30

Percent
- 1 .2 5
/ .09

m m z

-3 of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections 1*2 and

117 (a) (1) of the Internal Revenue Code* as amended by Section 115> of the Reve­
nue Act of 19U1, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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. Ul8, as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

7

I M

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 Secretary of the Treasury 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-competitiye 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 Yrith the bids must be made or completed at the /
Federal Reserve Bank on

April 8, 1948

in cash or other immediately avail

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders will receive equal treatment.

April 8, 1948

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, shall not have any exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, whether Federal or State, but shall be 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 ary local taxing authority.

For purposes

Baehagbit 1

TREASURY DEPARTMENT
Washington

(e V ?
FOR RELEASE, MORNING NEWSPAPERS
Friday , April 2. 1948.________ _

The Secretary of the Treasury, by this public notice, invites tenders for
$ i onn nnn non s or thereabouts, of

91 -day Treasury bills, for cash and

in exchange for Treasury bills maturing

April 8, 1948

j to be issued on

a discount basis under competitive and non-competitive bidding as hereinafter
provided.
will mature
interest.

The bills of this series will be dated
o

iqi.q

and
April 8, 194B_____ , and

when the face amount will be payable without

They will be issued in bearer form only, and in denominations of

Tenders will be received at Federal Reserve Banks and Branches up to the
closing hour, two o Tclock p.m., Eastern Standard time,

Monday, April

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

1948
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.
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

TREASURY DEPARTMENT
Washington
for rel e a s e , morning newspap ers,
Friday, A p r i l 2, 1948. _______ _

Press Service
No. S -6 7 9

The S e c r e t a r y of the Treasury, by this p u b l i c notice, i n ­
vites t e n ders for $ 1 ,2 0 0 , 0 0 0 ,0 0 0 , dr t h e r e abouts, of 9 1 - day
T r e a s u r y bills, for c ash an d in e x c h a n g e f or T r e a s u r y b i lls
m a t u r i n g A p r i l 8 , 1948, to be i s s u e d on a d i s c o u n t b a s i s u n d e r
comp e t i t i v e and n o n - c o m p e t i t i v e b i d d i n g as h e r e i n a f t e r p r o vided.
The b i lls of this series w i l l be d a t e d A p r i l 8 , 1948, an d w i l l
m a t u r e J u l y 8 , 1 9 4 8 , w h e n the face a m ount w i l l be p a y a b l e w i t h ­
out interest.
T h e y w i l l be i s s u e d in b e a r e r f o r m only, and in
d e n o m i n a t i o n s of $ 1 , 0 0 0 , $ 5 *0 0 0 , $ 1 0 ,0 0 0 , $ 1 0 0 , 0 0 0 , $ 5 0 0 , 0 0 0 ,
and $ 1 , 0 0 0 ,0 0 0 ( m a t u r i t y v a l u e ) .
T e n ders w i l l be r e c e i v e d at F e d e r a l R e s e r v e B a n k s and
B r a n c h e s up to the cl o s i n g hour, two o ' c l o c k p.m., E a s t e r n
St a n d a r d time, Monday, A p r i l 5* 1948.
T e n d e r s w i l l not be r e ­
ceived at the T r e a s u r y D e p a r t m e n t , W a s h i n g t o n ;
Each tender
mus t be for an e v e n m u l t i p l e of $ 1 ,0 0 0 , and in the case of
c o m p etitive tenders the p r i c e -offered m u s t be e x p r e s s e d on the
basis of 1 0 0 , w i t h not m o r e t h a n three decimals, e. g., 99*925*
F r a c t i o n s m a y not be used.
It is.'urged that tenders be m a d e
on the p r i n t e d forms and f o r w a r d e d in the special env e l o p e s
w h i c h w i l l be s u p p l i e d by F e d e r a l R e s e r v e B a n k s or B r a n c h e s on
a p p l i c a t i o n therefor.
■ Te n d e r s w i l l b e .r e c e i v e d w i t h o u t d e p o s i t f r o m i n c o r p o r a t e d
banks and trust companies a n d f rom r e s p o n s i b l e and r e c o g n i z e d
dealers in i n v e s t m e n t s e c u r i t i e s . T e n d e r s f r o m others m u s t be
a c c o m p a n i e d b y p a y m e n t of 2 p e r c e n t of the face amou n t of
T r e a s u r y bills a p p l i e d for, unless the tenders are a c c o m p a n i e d
b y an express g u a r a n t y of p a y m e n t by an i n c o r p o r a t e d b a n k or
trust company.
I m m e d i a t e l y a f t e r the c l o s i n g hour, t e n ders w i l l be opened
at the F e d e r a l R e s e r v e B a n k s a nd B r a n c h e s , f o l l o w i n g w h i c h
p u b l i c a n n o u n c e m e n t w i l l be m a d e by the S e c r e t a r y of the T r e a s u r y
of the amount and p r ice range of a c c e p t e d bids.
T h ose s u b m i t ­
ting tenders w i l l be a d v i s e d of the a c c e p t a n c e or r e j e c t i o n
thereof.
The S e c r e t a r y of the T r e a s u r y e x p r e s s l y r e s e r v e s the
right to accept or reje c t a ny or all tenders, in w h o l e or in
part, and h is a c t i o n in any such r e s pect shall be final.
Subject
to these reservations, n o n - c o m p e t i t i v e tenders for $ 2 0 0 ,0 0 0 or
less w i t h o u t stated p r i c e f r o m a ny one bidder, w i l l be a c c e p t e d
in full at the average p r ice (in three dec i m a l s ) of a c c e p t e d
c ompetitive bids.
S e t t l e m e n t for a c c e p t e d tenders in a c c o r d a n c e
w i t h the bids m u s t be m a d e or c o m p l e t e d at the F e d e r a l R e s e r v e
B a n k on A p r i l 8 , 1948, in cash or o t her i m m e d i a t e l y a v a i l a b l e

2
funds or in a like face a m o u n t of T r e a s u r y b i lls m a t u r i n g
A p r i l 8, 19^8.
C a s h and e x c h a n g e .tenders w i l l .receive e q ual
t r e a tment.
C a s h a d j u s t m e n t s w i l l be m a d e f or d i f f e r e n c e s ' b e t w e e n
the p a r v a l u e of m a t u r i n g b i lls a c c e p t e d in e x c h a n g e and the
i s sue p r i c e of the n e w bills.'
The income d e r i v e d f r o m T r e a s u r y bills, w h e t h e r i n t e r e s t or
g a i n f r o m the sale or o t her d i s p o s i t i o n of the bills, shall not
h a v e a n y exemption, as such, and loss f r o m the sale or o t h e r
d i s p o s i t i o n of T r e a s u r y b i l l s shall not h a v e a ny sp e c i a l treatment,
as such, u n d e r the I n t e r n a l R e v e n u e Code, or laws a m e n d a t o r y or
s u p p l e m e n t a r y thereto.
The b i lls shall "be subject to estate,
inheritance, gift or o t her excise taxes, w h e t h e r F e d e r a l or State,
but shall be exempt f r o m all t a x a t i o n n o w or h e r e a f t e r imposed, on
the p r i n c i p a l or interest t h e r e o f b y a ny State, or a ny of the
p o s s e s s i o n s of the U n i t e d States, or b y a ny l o cal t a x i n g authority.
F o r p u r p o s e s of t a x a t i o n the amount of d i s c o u n t at w h i c h Tre a s u r y
b i l l s are o r i g i n a l l y sold b y the U n i t e d States shall be considered
to be interest.
U n d e r Sections
a nd 117 (a) (1) of the Internal
R e v e n u e Code, as a m e n d e d b y S e c t i o n 115 o f the R e v e n u e A c t of
19^1, the amount of d i s c o u n t at w h i c h bills i s s u e d h e r e u n d e r are
sold shall n ot be c o n s i d e r e d to accrue u n t i l such bills shall be
sold, r e d e e m e d or o t h e r w i s e d i s p o s e d of, and such b i l l s are
e x c l u d e d fro m c o n s i d e r a t i o n as c a p ital assets-.
A c c o r d i n g l y , the
o w n e r of T r e a s u r y b i l l s (other t h a n life in s u r a n c e companies)
i s s u e d h e r e u n d e r n e e d include in his income tax r e t u r n only the
d i f f e r e n c e b e t w e e n the p r i c e p a i d f or such bills, w h e t h e r on
o r i g i n a l issue or on s u b s equent purchase, and the a m ount actually
r e c e i v e d e i t h e r u p o n sale or r e d e m p t i o n at m a t u r i t y d u r i n g the
taxable y e a r for w h i c h the r e t u r n is made, as o r d i n a r y g d i n or
loss.
T r e a s u r y Depa-rtment C i r c u l a r ho. ^18, as amended, and this
notice, p r e s c r i b e the terms of the T r e a s u r y b i lls and g o v e r n the
c o n d itions of t h eir issue. .Copies of the c i r c u l a r m a y be
o b t a i n e d f r o m a ny F e d e r a l R e s e r v e B a n k or Branch.

0 O0

iy

7aJJŸ
r
4

— 6 —

!#•'

Another recommendation vrould clarif3r tHe law on the treatment of employee
stock options, A fourth would abolish the three percent rule in the taxing
of annuities in' favor of a system allowing a tax-free recovery of cost
pro—rated over the expected period of the annuity, A fifth would create a
civil penalty for an employees failure to account for withholding taxes
collected from employees,. .
These proposals can be adopted without a substantial loss of revenue,
and would serve to eliminate many teclinical frictions in administering the
tax laws.
There are many other tax problems , however, which fall in an entirely
different category, either because their complexity requires more extended
study, or because their present adjustment would necessarily entail an
untimely reduction of government revenues ,
Outstanding among these problons is the need to return excise taxes to
their proper place in a peacetime tax system. Some of our excise taxes,
such as that on the transportation of freight, enter into the production .
costs of many commodities, and disturb normal competitive relationships.
This added to the restraining nature of excise taxes generally, calls for
their reexamination in all phases,

Tîegration of

During the past year the Treasury has completed and published 16 thorough
studies of such nroblems, and it is now oringing 1$ more near to completion.
The exbent and scope of these studies are in themselves strongly indicative
of the injustices prevailing in ouj* present tax structure

d * -------------

ï have many time

A
_
if‘o íit i"

ii-r^

action which has been taken in lowering pur present revenue level before
we have determined what our total outlay of expenditures is to be for the
fiscal year 1949 and before consideration Tías given to the révision of the
inequities in our tax structure.
In my on in ion, it was most inadvisable to have reached conclusions on
tax reduction before meeting the prerequisite obligations of foreign aid^
within a balanced budget, adequate provision for debt reduction, and equitable
tax revision,
Our overall fiscal policies must be courageously predicated on the permar*
went national interest and not on immediate advantages or individual profit.
We all know the gravity of the struggle in which we are now engaged -p
a struggle which has put in issue the very essence of our m o d e m civilization.
Every policy we adopt, every course we follow, must be considered in
the light of its affect upon our strength at home and our position before
the world,
o 0 o
3-680

Fanners, bankers, business and professional men and

women, labor and industrial leaders, newspapers and

radio stations, m0*-the motion picture industry, and

hundreds of volunteer workers cooperated enthusiastically«

Recognizing the importance of the Security Loan

Drive, I feel sure that the citizens of Louisiana will

more than match their achievements in previous campaigns

On Thursday, April 15, the Treasury Department will

launch the Security Loan Drive*

During the war and the postwar years, one of the

Treasury*s main objectives has been to sell as many U* S«

Government securities as possible to non-bank investors,

particularly individuals, in order to restrain inflationary

pressures*

In past bond campaigns, the Citizens of the City of

Shreveport and of the State of Louisiana have made a

sü^eatrle contribution to their security as individuals

and to the future stability of the American economy by

their purchases of U. S. Savings Bonds.

The success of

previous campaigns directly resulted from the efforts of

your citizens in all fields of activity

n
,/{

Every policy we adopt, every
course we follow, must be considered
in the light of its affect upon our
strength at home and our position
before the world.

iwiH

mm

IH •

Wtk.

aid within a balanced

I am entirely opposed to the recent
action which has been taken in lowering
our present revenue level before we
have determined what our totaI outlay
of expenditures is to be for the fiscal
year 1349 and before considerati on was
given to the revision of the inequities
in our tax structure.
in my opinion,

it was most

inadvisable to have reached conclusions
on tax reduction before meeting the
prerequisite obligations of foreign

thorough studies of such
15 «lore near

these studies are in themselves
strongly indicative of the injustices
in our
structur e .
i have many times stated, and
still firmly Delieve, that hasty and
poIi ticaI Iy expedient tax reduction
will prove a definite deterrent to our
'/'
fiscal so Ivency and economic secur ity.

normal competitive re Iationships.
This, added to the restraining
nature of excise taxes generally,
cells for their reexemination in all
phases.
Another such problem is the need
for strengthening of the role of the
estate and gift taxes, and the
achievement of a better integration
of these taxes with the income tax.

3 3

¡ P

their complexity requires more extended
study, or because their present
adjustment «ou id necessarily entail
an untimely reduction of government
revenues.
Outstanding among these problems
is the need to return excise taxes to
their proper place in a peacetime tax
system.

Some of our excise taxes,

such as that on the transportâtion of
/

freight, enter into the production
costs of many commooi ties, and disturb

-

b fd

32

collected from employees.
These proposals can be adopted
without a substantial

loss of

revenue, and would serve to eliminate
many technical frictions in
admin ister ing the tax laws.
There are many other tax problems,
|

however, which fall

;

in an entirely

different category, either because

businesses, this would be of great
benefit to them.

The provision for a
over of losses,
to a new firm.

s inee
cou Ia

used as an offset

have also recommended an
-ation of

tax rate structure
ith incomes under

$50,Uüû, to see whether a more
desirable arrangement of rates can be

Bps

(o

•■
' :: •
'
I

29

-

îù

-

recommendations will be forthcoming.
The submitted proposals relate
to a variety of both substantive and
a d m in istrative matters.

One, for

instance, would change the present
net operating loss deduction carry-back
from two years to one and the
I
Afe

¿

JL

fit
JQl W

carry-over from two years to five.
thus materially assisting new business,
as well as old.
In view of the recognized greater
instability of earnings of small

i J ù

,

It

is

position of the

that

MÈÊ*

M

#

In I

show Id

to minimize existing.
1

I

unneces

fr ict ions.

1
i

In February, the Treasury submitted!
House

and

C o m m ittee

containing recommendations for
Ad technical changes

in the

laws, each of which,

if made, would in

our estimation eradicate an existing
inequity or other
■ if

listi ngs

These

not completed and further

Trie Treasury is continually
engaged in examining the areas of
X

impact between all of our tax laws and
the daily lives ana fortunes of our
people.

Although the tax burden

cannot be reduced at one point at the
cost of an inequitable increase at

concerns, many of which were made in
cooperation with banks.
The Government is also deeply
concerned with the taxation problems
of small businessmen.

Federal tax

provisions wnich are detrimental

in

tneir effect are tne subject of active
and thorough study by the Treasury
Department.

The present system of

graduated income taxes, of course,
is advantageous to small business.

procurement of Government contracts
for smaI I manufacturers,

in matters

relating, to trade practices, and
similar useful services.
Small business concerns may obtain
assistance in their financing and credit
problems through the Reconstruction
Finance Corporation under conditions
specified by the Congress.

In fact,

during the entire period of its
existence, about 30 percent of
RFC loans have been extended to such

!7‘-7Tk'.

Ræfjil

(o

f0

24
IjSMl

An important funct.lon of the

JfÉl

W &’-l

f Ieg of $ma i i Business is to provide
competent assistance in meeting

bC-itJ
jiil&l
H
p r

operating problems by offering counsel

M ê
ÊÉiM

and advice on inventory control,
pricing, marketing, the establishment

I.V-#

of new businesses, and other technical
and practical matters.

¡g É
„»
■»fei»'*

RK|%1
E'.y-’f"-- Jj

ig g l
I

'

A second major function is to
Nw.

represent the interests of small

lâfl

i 111

business before other Government

:i |

¡8111

agencies.

Thus it is concerned in

R l
IfA

Wièÿm
nil

MfilP

the disposal of war surplus,

in the

fc

PIP,

>ttl : :,;j : s Œ ÏS S i »«W i

6

aid to smaIi business is largely
handled by the Department of Commerce,
through its Office of Small Business
and by the figeonstruction Finance
Corporation.

Veterans have feeen

given special aia in starting their
own enterprises under the GI Bill of
lights

substantial part of the

postwar increase in new businesses
nas been due to the veterans' aid
program, sponsored by the Veterans'
Admin istruì ion.

fi
I .

business, have
the ir

»n

the Government
of
i Ii business, and has

oIrecteo

ial efforts to this
the Government dia

job in channelling war contracts

firms ana in aiding their conversion
w o r k

Government

|«ÌÌ

and development.
Too often, the satf i firm lacks
syfficient equity capital, since If
must rely largely on local funds.
Particularly In the case of net firms
difficulty may be encountered In
getting short-term backing. Further,
a serious financial problem faced by
many small businesses Is the lack of
alternative methods of financing.

This

danger may be acute for those «ho,
V

relying on the expectation of continued

management * skilled employees, and
most of all, adequate capital.

"

The small business firm is
usually handicapped in assembling a 11
of these qualities in a single
management and therefore, finds it
a difficult undertaking in many
instances to compete with big business
In those instances, however, when we
find the combination of these
requirements in i| small business, we
can definitely look forward to expans•

substantial proportion of our retaiI
stores, repair shops, filling stations,
amusement enterprises, and other
businesses supplying an important
element of personal service.
The Department of Commerce has
estimated that small business accounts
for 45 percent of the workers employed
in the Unitea States and 34 percent
of the total dollar

volume of business.

in any business, the first
requisites for success are sound

of us know that business
units with less than 50 employees
make up 98 percent of all national
business.

There are today 3,800,000

small businesses in this country
and the larger proportion of these
consist of very small units -- a
single proprietor, or a proprietor
with one to four paid employees.
In 1947, for example, over 80 percent of
the small business units had less than |
four employees.
These units represent a

projects for the Mississippi Valley
following tne great flood of 1927.
Harvey Couch had this advice to young
bus inessmen:

“D o n ’t wait for some

gigantic industry.

Start a little

one and watch it grow.M
These are random examples among
thousands where initiative and vision,
promoted small scale ventures into
organizations of considerable magnitude.
There are countless others who, starting
in a small way, developed a product or
service into a big business enterprise.

extended a one-man venture into the
world's largest chocolate company.
And we can well pay tribute here
to a great industriaIist from this
area -- Harvey Couch of Arkansas,
who developed a one-line telephone
service into a four state enterprise,
and sold it for substantially more
than a million dollars;

who

organized a great railroad system;
and who promoted nation-wide
interest in permanent flood control

leading inaustriaI ists received their
start in these practical schools.
I need not recount the stories
of such outstanding men as Henry Ford,
starting his business career with a
bicycle repair shop; or Thomas Edison,
with his raiIroad newspaper business;
or Harvey Firestone, who once sold
buggies and patent medicines, and
whose Firestone Tire and Rubber Company
had only 17 employees when organized in
1900.

M i Iton Hershey of Fennsy Ivan ia ,

1

- I5A -

6?

if obligations should be placed
upon it to convert to defense
product ion.
Furthermore, the thousands of
smaller businesses have afforded
continued opportunity for the
development of private initiative.
And it is from such small beginnings
that our large corporations have mainly
developed.

Likewise, many of our

suppliers for larger companies and
helping to make possible the
spectacular output of the large war
plants.

And similarly today, the

small business group is a very
important factor in our present levels
of production.
I fee I equally certain that as
our present plans for strengthening
our national defenses develop that
small business will be in the van

m

|4

*■*

a close business relationship exists
between the proprietor and the
customer, or where the customer’s
requirements are not susceptible
to a certain degree of standardization.
Prosperous small business is absolutely
necessary to a strong and well-balanced
national economy.
Small firms proved their value
during the war, not only through their
own production, but by serving as

D

- id
factories, grocery s
such
cn
.

communi

In
firms ©stab!

since V-J

Prosperous small business is the
core of American free enterprise.

The

small businessman pI ays a vital part in
all community affairs and,

in many

instances, serves those needs m a t coo Ml
most large
t Im s

arly true

country, the return of peacetime

I

business and industry nas opened up an
.

abundance of new opportuni ties in such
.
fields as construct ion, manufactur ing,

I

distribution of durable goods, and
various service industries.

By the

end of last year, the number of business
units in the United States reached a
I
total of nearly 4 million -- or
470,UuG more than the IS4I prewar high.
Nearly ail of these new ventures
were in modest proportions -- small

mm

'

'- ’

ïiî

- lu -

important part of the national

\

1

waterway system, will greatly augment
business possibilities in this part of
the country.
Such a system would facilitate
transportâtson for the petroleum
industry -- which occupies such an
important position in this area -- for
fertilizers, chemicals,

iron and steel,

and other of your products so
significant to the national economy.
Ihe completion of this waterway will

us.

Consequent Iy, governments I

outlay in the public works programs
has been confined almost entirely to
projects already under way.

However,

in view of their strategic value,

it

is certain that the next few years wi
allow further major advancements in
these important operations.
A removal of the recurring
flood threats in the Red River
area, and future extension of
navigation to make it an increasingly

8
Control Flan.
. r, ;■■

It is extremely regrettable that
vital budgetary considerations have
made it inadvisable to authorize
larger appropriations at this time to
speed further the progress of flood
control and otner public works projects
throughout tne nation.
know,

As you well

it is important now for us to

minimize Government competition for
scarce labor and materials as long as
inflationary pressures are still with

- 7 projects, ail of which you have
supported.

But more important, the

president recommended over $4 million
for IS49 work oh the Texarkana
Reservoir on the Sulphur River.

As

you know, two-thirds of this money
K

would actually go toward initial
construction work on the dam.

The

President*s program also provides for
an expansion of planning activity in
134S on four of trie other reservoirs
cont-empIated in the Interim Flood

5
world,

is an outstanding example

of the improvements you have fostered.
It has contributed considerable and
permanent benefits in flood control
and in providing means to generate
substantial amounts of hydroeIectric
power.
The completion of the Wallace
Lake Reservoir, designed to protect
lives ana property from disastrous
and recurring floods,

is likewise

an achievement in which you have

- 4 -

|| §f||

accomplished when combined efforts
are directed towara the objective of
over-all economic health.

The aims

and purposes of your group are not
confined to a single county or parish,
nor even to the four states which you
represent.

The benefits ana profits

of your undertakings accrue to the
entire country.

Your achievements

are impressive.
Tne completion of Denison Dam,
one of tne largest earthen dams in the

of communist aggression.
Time and again, we have proved
beyond doubt the benefit which the
individual derives when he gives
his time, his thought, and his
constructive action not only to his
own gain, but to the problems of
his community and his nation as a
whole.

This fact has been more than

evidenced in every section and segment
of our national

life.

Your own organization is an
outstanding example of what can be

in thè struggle of democratic society
against the creeping paralysis of
brutal unrestrained dictatorship.
He have, as free men,

the weapons

to confront the danger with our
tremendous physical resources and
the natural aptitude and special
abilities which spark our
ever-increasing economic development
and well-being.

'With such powerful

weapons, and with a common will, we
can meet and repel the advance

Political, social, and economic
unrest in the worId today maKes it
imperative that this couutry be
strongly united -in every field of
national effort.

The dangerous

inroads a l r e a d y made by subversive
forces which would undermine the
democratic order can be defeated
only by common endeavor and complete
unity of purpose.
The United States has never, and
will not now, shun its proper leadership

TREASURY DEPARTMENT
Washington

:

îê II II

(The following address by Secretary Snyder before
the Annual Luncheon of the Red River Valley
Association at the Washington-Youree Hotel,
Shreveport, Louisiana, is scheduled for delivery
at 12:00 noon^April 7, 1948, C.S.T., and is for
release at thaS, time.)

TREASURY DEPARTMENT
Washington

(The following address by Secretary Snyder before
the Annual Luncheon of the Red River Valley
Association at the Washington-Youree Hotel,
Shreveport, Louisiana, is scheduled for delivery
about 1 »00 PM, CIS.T», April 7, 1948, and is for
release at that time»)

Political, social, and economic unrest in the world today makes it
imperative that this country be strongly united in every field of national
effort«» The dangerous inroads already made by subversive forces which would
undermine the democratic order can be defeated only by common endeavor and
complete unity of purpose.
The United States has never, and will not now, shun its proper leader­
ship in the struggle of democratic society against the creeping paralysis
of brutal unrestrained dictatorship. We have, as free men, the weapons to
confront the danger with our tremendous physical resources and the natural
aptitude and special abilities which spark our ever-increasing economic
development and well-being* With such powerful weapons,, and with a common
will', we can meet and repel the advance of' communist aggression.
Time and again, we have proved beyond doubt the benefit which the indi­
vidual derives when he gives his time, his thought, and his constructive
action not only to his own gain, but to the problems of his community and
his nation as a whole. This fact has been more than evidenced in every
section and segment of our national life,,
.E
Your own organization is an outstanding example of wrhat can be accom­
plished when combined efforts are directed toward the objective of over-all
economic health® The'-- aims and purposes of your group are not confined to
a single county or parish, nor even to the four states which you represent.
The benefits and profits of your-undertakings accrue to the "entire country.
Your achievements are impressive.
The completion of Denison Dam, one of the largest earthen dams in the
world, is an outstanding example of the improvements you have fostered. It
has contributed considerable and permanent benefits in flood control an d i n
providing means to generate substantial amounts of hydroelectric power.
The completion of the Wallace Lake Reservoir, designed to protect
lives and property from disastrous and recurring floods, is likewise an
achievement in which you have played an important part*,.

£-680

- 2 -

The Congressional authorization of both the Interim Flood Control Plan
and the Overton—Red River TTaterway^ represent further tangible steps in
your broad program for the economic development of this Valle,. .
The President included in his 1949 Budget a request for funds which
would enable the completion of the Bayou Bodcau Reservoir and the AlohaRigolette and Shreveport levee projects, all of which you have supported.
But more important^ the President recommended over $4 million for -1949 work
on the Texarkana Reservoir on the Sulphur River. As you know, two-thirds
of this money would actually go toward initial construction ?iork on the dam.
The Presidents program also provides for an expansion of planning activity
in 1949 on four of the other reservoirs contemplated in the Interim Flood
Control Plan.
It is extremely regrettable that vital budgetary considerations have
made it inadvisable to authorize larger appropriations at this time to speed
further the progress of flood control and other public works projects
throughout the nation* As you well know, it is important now for us to
minimize Government competition for scarce labor and materials as long as
inflationary pressures are still with us. Consequently, governmental outlay
in the public works programs has been confined almost entirely to projects
already under way. However, in view of their strategic value, it is certain
that the next few years will allow further major advancements in these
important operations.
A removal of the recurring flood threats in the Rod River area, and
future extension of navigation to make it an increasingly important part
of the national waterway system, will greatly augment business possibilities
in this part of the country.
Such a system-would facilitate transportation for the petroleum industry
which occupies such an important position in this area — for fertilizers,
chemicals, iron and steel, and other of your products so significant to the
national economy. The completion of this waterway m i l add new. impetus to
the. greatly expanding business activity of the entire area.
At this particular time, I believe that the Red River Valley Association
could appropriately assist in giving a sound and strong base to this expan­
sion by promoting and encouraging small business undertakings as one of the
majo r cb je ctive s in its Ion g—ran go pro gram.
Here, and throughout the entire country, the return of peacetime business
and industry has- opened up an abundance of now opportunities in such fields
as construction;, manufacturing, distribution of durable goods, and various
service industries. By the end of last year, the number of business units
in the United States- reached a total of nearly 4 million — or 470,000 more
than the 1941 prewar high.

S-680

»>

W#]

3 -

Nearly all of these new ventures were in modest proportions — small
factories, grocery stores, building projects, repair shops, and other such
undertakings which met community demands. In fact, more than 95 percent of
the new firms established since V—J Day have had less than eight employees.
Prosperous small business is thé core of American free enterprise. The
small businessman plays a vital part in all community affairs and, in many
instances, serves those needs that could not adequately be met by most large
firms. This is particularly true where a close business relationship exists
between the proprietor and the customer, or where the customer’s requirements
are hot susceptible to a certain degree of standardization. Prosperous small
business is absolutely necessary to' a strong and well-balanced national
economy.
Small firras proved their value during the war, not only through their
own production, but by serving as suppliers for larger companies and helping
to make possible the spectacular output of the large war plants. And
similarly today, the small business group is a very important factor in our
present levels of production.
I feel equally certain that as our present plans for strengthening
our national defenses develop that .small business will be in the van if
obligations should be placed upon it to convert to defense production.
Furthermore, the thousands of smaller businesses have afforded continued
opportunity for the development of private initiative. And it is from such
small beginnings that our large corporations have mainly developed. likewise,
many of our leading industrialists received their start in these practical
schools.
*
I need not recount the stories of such outstanding men as Henry Ford,
starting his business career with a bicycle repair shop; or Thomas Edison,
with his railroad newspaper business; or Harvey Firestone, who once sold
buggies and patent medicines, and whose Firestone Tire and Rubber Company
had only 17 employees v/hon organized in 1900. Milton Hershey of Pennsylvania,
extended a one-man venture into the world’s largest chocolate company.
And we can well pay tribute here to a great industrialist from this
area — Harvey Couch of Arkansas, who developed a one-line telephone service
into a four state enterprise, and sold it for substantially more than a
million dollars; who organized a great railroad system; and who promoted
nation-wide interest in permanent flood control projects for the Mississippi
Vallqy- following the great flood of 1927* Harvey Couch had this advice to
young businessmen5 ’’Don’t wait for some gigantic industry. Start a little
one and watch it grow.”
These are random examples among thousands where initiative and vision,
promoted small scale ventures into organizations of considerable magnitude.

S-680

There are countless others 'who,'b.tartih|^ifi'*a %mall way, developed a product
or service into a big business''enterprise';'“
.
Few of us know that business units with' less than 50 employees make up
98 percent of all national business.. There are today 3,800,000 small
businesses in this country and the larger proportion of these consist of very
small units — a single proprietor, or a proprietor with one to four paid
employees.. In 1947, for example, over 80 percent of -the small business units
had less than four employees.
,
These units represent a substantial proportion of our retail stores
repair shops, filling stations, amusement enterprises, and other businesses
supplying an important element of. personal service.
The Department of Commerce has estimated that small business accounts
for 45 percent of the workers employed in the United States and 34 percent
of the total dollar volume of business.
In any business, the first requisites for success are sound management,
skilled employees, and most of all, adequate capital.
The small business firm*
Handicapped in assembling all of
these qualities in a single
therefore, finds it a difficult
undertaking in many Instances to compete with big business. In those instances,
however, •when- we find the combination of these requirements in a small business'"
we can definitely look forward to expansion and development.
Too often, the small firm lacks sufficient equity capital, since it must
rely largely on local funds,. Particularly in the case of new firms difficulty
may be encountered in getting short-term backing. Further, a serious finan­
cial problem faced by many small businesses is the lack of alternative methods
of financing. This danger may be acute for those who, relying on the expecta­
tion of continued good business, have tied up part of their short-term funds
in capital expansion.
For many years the Government has recognized the importance of helping
small business, and has directed special efforts to this end. During the
war, the Government did a good job in channelling war contracts wherever
possible toward the smaller firms and in aiding their conversion to war
work. Currently, Government aid to small business is largely handled by
the Department of Commerce, through its Office of Small 'Business,- and by
the Reconstruction Finance Corporation. Veterans have been given special
aid in starting their own enterprises under the GI Bill of Rights. - A sub­
stantial part of the postwar increase in new businesses has been due to the
veterans’ aid program, sponsored by the Veterans’>Administration.
An important function of the Office, of Small Business is to provide
competent assistance in mooting operating problems by offering counsel and

S-680

- 5 -

advice on inventory control, pricing, marketing, the establishment of new
businesses, and other technical and .practical matters*
A second major function is to- represent the interests of small business
before other Government agencies* Thus it is concerned in the disposal of
■war surplus, in the; procurement of Government contracts for small manufacturers,
in matters relating to trade practices, and similar useful services*
Small business concerns may obtain assistance in their financing and
credit problems through the Reconstruction Finance Corporation under condi­
tions specified by the Congress* In fact, during the entire period of its
existence, about 90 percent of RFC loans have been extended to such concerns,
many of which were made in cooperation ivith banks*
The Government is .also deeply concerned with the taxation problems of
small businessmen* Federal tax provisions which are detrimental in their
effect are the subject of active and thorough study by the Treasury Department*
The present system of graduated income taxes, of course, is advantageous to
small business*
The Treasury is continually engaged in examining the areas of impact
between all of' our tax laws and the daily lives-and fortunes of our people.
Although the tax burden cannot be reduced at one point at the cost of an
inequitable increase at another, it is the- position of the Treasury that
steps should definitely be>taken to minimize existing, unnecessary frictions.
In February, the Treasury submitted to the House hays and Means Committee
a statement, containing recommendations for 49 technical changes in the Federal
tax laws, each of which, if made, would in our estimation eradicate an
existing inequity or other defect* These listings are not completed and fur­
ther recommendations will be forth coming*
The submitted proposals relate to a variety of both substantive and
administrative matters. One, for instance, would change the present net
operating loss deduction carry-back from two years to one and the carry-over
from two years to five, thus materially assisting new business, as well as
old*
In view of the recognized greater instability of earnings of small
businesses, this would be of great benefit to them* The provision for. a
five-year carry-over of losses, would be especially valuable to a pew firm,
since losses in the early years of operation could be used as an offset to
later profits*
We have also recommended an exploration of the tax rate structure for
corporations with incomes under $50 *000, to see whether a more desirable
arrangement of rates can be made as a substitute for the present so-called
’’notch rate” on corporate income in the bracket between $25,000 and $ 50 ,000 *

S-680

-* 6 **

Another recommendation would clarify the law on the treatment of employee,
stock options, A fourth would abolish the three percent rule in the taxing
of annuities in favor of a system allowing a tax-free recovery of cost pro-rated
over the expected period of the annuity* A fifth would create a civil penalty
for an employees failure to account for withholding taxes collected from
employees,..'
These proposals can be adopted without a substantial loss of revenue,
and would serve to eliminate many technical frictions in administering the
tax laws.
There are many other tax problems, however, which fall in an entirely '
different category, either because their complexity requires more extended
study, or because their present adjustment would necessarily entail ah'
untimely reduction of government revenues.
Outstanding among these problems is the need to return excise taxes to
their proper place in a peacetime tax system. Some of our excise taxes,
such as that on the transportation of freight, enter into the production
costs of many commodities, and disturb normal competitive relationships, *
This, added to the restraining nature of excise taxes generally, calls for
their reexamination in all phases.
During the past year the Treasury has completed and published 16 thorough
studies of such problems, and it is now bringing 15 more near to completion.
The extent and scope of these studies are in themselves strongly indicative
of the injustices prevailing in our present tax structure.
As Secretary of the Treasury, I was opposed to the recent action which
has been taken in lowering our present revenue level before we have determined
what our total outlay of expenditures is to be for the fiscal year 194-9 and
before consideration was given to the revision of the inequities in our tax
structure,
In my opinion, it was most inadvisable to have reached conclusions on
tax reduction before meeting the prerequisite obligations of foreign aid
within a balanced budget, adequate provision for debt reduction, and equitable
tax revision.
Our overall fiscal policies.must be courageously predicated on the perma­
nent national interest and not on immediate advantages or individual profit,
We all know; the gravity of the struggle in w;hich we are now; engaged —
a struggle which has put in issue the very essence of our m o d e m civilization.
Every policy w;e adopt, every course w;e follow;, must be considered in the
light of. its affect upon our strength at home and our position before the world,

o 0 o
S-6S0

FOR IMMEDIATE HELEASE
torll 5. 1&
>—

•

j
The Bureau, of Oust one announced today that the amount
of fish* fresh or fro sen (whether or not packed in ice)*
filleted* skinned* honed, sliced* or divided into portions*
not specially provided for:
cusk*

cod* haddock* hake* pollock,

rosefish imported for consumption daring the period

January 1 to March 27* lS^g, inclusive* was approximately
11/43^*851 pounds.

TREASURY DEPARTMENT
Washington
POR IMMEDIATE RELEASE
Monday,: April 5, 1948

'

Press Service
No. S~681

The Bureau of Customs announced today that the amount of fish,
fresh or frozen (Aether or not packed in ice), filleted, skinned, .
boned, sliced, or divided into portions, not specially provided for:
cod, haddock, hake, pollock, cusk, and rosefiSh imported for consump­
tion during the period January 1 to March 27, 1948, inclusive, was
approximately 11,434*851 pounds.

oOo

toward the balanced growth and
stability of internat ionaI economic
re la t ions.
Ae intend to demonstrate that
the Good Neighbor policy of voluntary,
strong economic cooperation can be
a potent instrument in defeating
totalitarian intimidation, aggression

li

-

■

6$
-

54

to remove those obstacI es and
restrictions to mutually advantageous
commercial relations.
The agreement reached by fifty
nations on the Charter for an
Internati onaI Trade Organization
is a constructive and worthwhile
frame*or k for efficient economi fs
I

cooperation.

Ae have good reason

to hope that the inter-Amer ican
conference at Bogota will further
develop effective agreements

through equitable tax provisions
which will permit the greatest
possible incentives to business
growth.

He must have a free and

ample flow of private capital,
unoer conditions which afford such
capital and initiative proper
safeguards.
For these reasons, common to
us al I, the United States and other
independent nations are today
seriously engaged in negotiations

problem involved in the promotion
and development of internet i-ona I
trade.

Further,

internationaI

trade is only one consideration of
our internal economy.
h e must so shape our

internaI

affairs that the United States *¡11
continue to be strong.
To attain this end, we must
maxe sensible use of our natural
resources,

through an effective

system of private enterprise, and

-

31

-

which might serve to furnish
additions i incentives to inter-Amer¡can
trade.
The problem of taxing Americans
doing business abroad involves
various and important cons iderat ions,
chief among which is the desire to
encourage the proper flow of private
American investment funds into
foreign marKets.
Tax considerations, however,
are only one phase of the entire

genera I, taxed on their entire
income whether derived from domesti
or from foreign sources.

There are

in the tax laws, however, a few
provisions of limited scope which
were specially designed for the

interoretations of present Ia.s

Another phase of the Treasury's
attack on inis same problem is a
systematic réexaminâtion of our own
tax treatment of American citizens
and corporations doing business
abroad.
The general policy of the tax
laws at the present time is to make
no special concessions to taxpayers
engaged in business activity outside
the United States.

American citizens

and American corporations are,

in

I

convention program to date has
itself been the greatest inducement
tor its further extension.
Discussions have already been held
ftith the Benelux countries and
DenmarK, with New Zealand, and with
Mexico and other Latin-Amer ican
countries.

He earnestly hope t

these discussions will ripen into
agreements similar to those to
which 1 have just referred.

Common to most of them is the aim
to minimize the double taxation of
income and estates; to simplify
the administration of the tax laws,
where the taxpayer is subject to
the tax jurisdiction of both
governments; to insure against
changes in the tax laws of one
country as they affect citizens
of the other; and to facilitate
the collection of taxes, where
tax jurisdiction is divided.

Moreover, treaties with France and
the Union of South Africa, covering
both income and estate tax problems,
are now pending before the Senate.
No two of these instruments
are identical.

Some of their

provisions are for the benefit of
the contracting governments, others
are for the benefit of the citizens
or residents of each country, who
have income or property subject to
the jurisdiction of the other.

4

-

25

-

Another% recommends11 on to
reduce the friction between the
collection of Federal revenues
and our foreign economic program
is in the extension of bilateral
tax conventions with foreign
countries.

Today we have actually

in effect comprehens ive income
tax conventions with Canada, the
United Kingdom, France and Sweden,
and estate tax conventions with
Canada and the United Kingdom.

V|J

abroad will rise to more than a
billion dollars.

if this anticipation

4

should be realized,

it would help

to alleviate tne world-wide dollar
shortage.
The current $100 duty-exemption
on goods brought into the United States
by returning tourists is generally
considered to be too low.

A

pending bill in the Congress,

if

enacted into law, would increase tnis
exemption to $600.

the period between the two World Wars,
American tourists spent abroad
annua ii y between 50U and 600 million
dollars.

These expenditures représentée

more than 10 per cent of American
imports, and thus supplied foreign
countries with more than 10 per cent of
their dollar exchange.
national

Today our

income is far above that of

the highest of pre-war years, and it
is sate to anticipate that with
proper encouragement the annual
expenditures of American tourists

f air distr ibut ion of the tax burden.
In my opinion, one way in which
a revision of the tax laws can
properly contribute to our foreign
economic program is exemplified by
a bill now pending in the Congress
which would increase the duty-exemption
on goods brought into the United States
by returning American tourists.
American tourist-traveI abroad
long constituted

has

important source

dollars to foreign countries.

During

of

if

21
ire western hem ¡sphere
Concurrently with our growing
interest in internationa I trade,
attention must be given to the
impingement of our Federal tax laws
upon our internationaI trade programs
The Treasury has constantly under
stuciy, provisions to lessen the
friction of Federal taxes in every
way consistent with the financial
integrity of the government, the
stability of our economy, and the

British petroleum interests, and the
agreements on revoIuti onary and
agrarian claims are evidence of
Mexico’s intention to give fair
treatment to foreign capital.

In

view of these and other developments,
there has been an appreciable flow
of private capital to Mexico.

It is

hoped that the situation will continue
to improve, and that U. S. enterprises
can h e l pr

in Mexico's economic g r o w t h ,

as well as in the growth of the

be properly provided by internationaI
trade.

In particular, the Mexican

economy needs United States capital
ana United States technology.

The

Mexican Government is fully aware of
these needs, and in recent years has
taken constructive steps to encourage
foreign capital
Definitely,

investments.

its settlement of the

defaults on the external public debt
ana the external railway debt,

its

agreements with the United States and

Æjèi

6*
18
Our
a

Trade

Governments have recent Iy
to discuss revision of the 1942
t to iron out inequities

which have developed since its adoption.
1 am confident that reasonable
modifications can be made which wi I
protect the essential

interests of

both couhtries and provide a
framework for further expansion of
the volume of trade between them.
Mexican economic requirements
are, of course, far beyond what can

pc

can be maintained.
Commercial relations between
modern governments are never simple
and easy, and those of the United
States with Mexico are no exception.
It is not an exaggeration to say,
however, that the reciprocal trade
agreement signed in 1942 by our two
governments has helped to steady these
difficult relations and to establish
tariff rates along lines beneficial to
the general

interests of both countries

Mexico's steel, petroleum and electrical
industries,

its highways and railways,

its sugar mills, meat canneries and
other activities representing a
cross section of the business of the
country.
The United States-Mexican
Stabi Iization Agreement, signed in
19 4 1 and renewed in 1947, has
contributed much to create an
&

tmosphere of confidence and stability

in which steady economic progress

operations to

Because of its close proximity to
i.s area,

i wilt again use Mexico as a:

ample in citing certain of the mutual
benefits of economic cooperation.
Export-Import Bank credits already
mentioned have aided the development of

expanding flow of goods.
The Export-Import Bank of
Wash ington has helped materially in the
financing of Latin American economic
development.

Total credits of over $1

billion have been authorized for
Latin America since the inception of the
Bank, witn about $90U million of that
total coming in the period after
July I, I940.

The Admin istrati on is no«

proposing that the Congress increase
the lending power of the Export-Import

P

commerce and industry.

A series of

¡¡If • great irrigation projects are being
charted to transform some of Mexico's
desert or semi-arid regions into highly
productive agricultural

lands.

The Mexican Government is also
taking steps to develop and utilize more
of its petroleum resources, both for the
growing export demand and the expanding
Mexican domestic requirements.

Further,

it is planning additional railway
and port facilities to handle the

0

0

- 12 plans for more fully utilizing their
vast resources, stimulating production,
and increasing tourist trade, the plans
of Mexico are perhaps most familiar
to you.

As you know, the Mexican

government is vigorously promoting a
program for continued expansion of
highways, thus encouraging tourist
travel and trade.

it is actively

promoting the expansion of Electric
power production necessary to
keep pace with the growing needs of
/

►IWSNiWSlSiSi-i.1
:,-fc •-

Vf

I remain a memorial to the accomplishments
l

of peaceful joint consuI tat Ions among
the twenty-one American Republics.
It is expected that at the present
conference, agreements reached to make
effective economic cooperation will,
as one result, make possible a future
Intensified growth of production,
employment and technical
developments in Latin America.
While nearly all of the Latin
Mmerican countries have ambitious

and closer inter-American cooperation,
are today receiving serious
consideration at the assembly of
nations now gathered at Bogota,
Colombia.

This Ninth InternationaI

Conference of American States is
carrying forward the notable series
of Han American meetings which began
in 1830.

From these periodic

conferences, a system of internationaI
re Iationsnips has evolved which is
unique in the world, and wnich will

Latin America have also been
accentuating their own efforts toward
economic diversification and increased
productivity.

In spite of very serious

obstacles, such as shortages of
machinery and capital, and the need
for establishing new patterns of
there has
recently been a substantial
advancement in the Latin American
repub lies.
Programs for greater development.

x

a;..

■

■

¿b ^

m
-

8

n

-

the 1839 figures of $10.4 million.
Added to the benefits derived
from commodity exports is your special
community interest in the tourist trade.
The facilitation of tourist travel
will be aiI

important in the patronage

of the thousands of Americans who pass

%F

through your states and counties on
the way south.
While United States business and
banking, interests have been making
notable progress, governments in

I

genera I advancement of any country
with whom we trade resultf in better
markets for United States goods, and
greatly contribute! toward our own
productivity.
An examination of United States
foreign trade statistics shows that the
Southwest has a large share of our
foreign business. Exports passing
through the customs d istricts of £1 Has
and Arizona were $74 million in 1947,
an increase of about 600 percent over

a
6 you are particularly concerned witn
ways

means of fostering an

ever-increasing

mentation of

American industry and trade.

You are

fully aware of the importance of a
constructive trade development program
to our continued business prosperity.
The sound growth of the
Latin American Nations will

increasing!)

enlarge our own volume of trade and
economic activity.

Past experience

shows that the inoustria Iization and

,L

- I postwar business.

In part, they have

resulted from money expended for
reclaiming and replenishing of the
soil.

The great dams that have been

built to store up and distribute water
over this vast area have made possible
a more prosperous agriculture and nave
attracted a greater variety of
industry.
As bankers and as active
participants in this impressive
business expansion of the Southwest,

- 4 $60 million.

fj

Today they are at a

peak of $300 million.
These are more than just coId
figures.

They mirror a decade of the

phenomenal growth which has taken
place in the Southwest -- a growth
which has not even begun to exhaust
the potentialities of this territory.
These figures represent production in
industry and agriculture that
contributed directly and effectively
to victory in war, ana to expansion in

i

3 have unm istakabIy profited by it.
Ten years ago,

in the States ‘of

Arizona, New Mexico, and the western
part of Texas, there were 102 banking
offices.
127.

At the present time, there are

Ten years ago, the total

resources of' these banks were

$200 million.

Today they are $362

I hm

million -- an expansion of nearly five
hundred percent.

Ten years ago,

loans

extended by banks in the area
represented by this group, aggregated

resulted in a better balanced and
more resilient economy.
The economic importance of the
Southwest is enhanced by its position
so near to the center of our security
zone.

The vast extent of this area,

ano the opportunity which it affords
for industrial deployment, make it
a priceless national asset.
You bankers have materially
contributed to the growth of this
territory, have shared in it, and

I

:

b'fr

■

Geographic decentraIÎzation of
American industry has conspicuously
marked the progress of economic
stabilization in the United States
within the last ten years.

The

Southwest has particularly benefited

by

t n is d iversification.
This trend is strongly evidenced
in banking, population, and production
f igures.
The coming of age of this part
of the country has been a healthy
development for the Nation.

It has

2r

(O * ^

The citizens of this great area of the United States

made a creditable showing in past bond campaigns.

On the

basis of this past record, I know that they will do their

full share to make the Security Loan Drive a real success.

0 Q 6

April 15 marks the opening of the Security Loan Drive*
■%

Money saved by buying and holding U. S. Savings Bonds is

money that will not compete in the ever-increasing demand far

goods^a^^m^JkBeFefteiiigs^m^es*

U. S. Savings Bonds which

individuals buy and hold will enable the Treasury to retire

more Government Securities held by the banking system and thus

help to curb inflationary crédit expansion*

U. S* Savings Bonds

which individuals buy and hold not only increase their personal

security but also help to b r i g g 'afrpwfr lower prices and thus

contribute to the economic stability of our country*

One week from today, labor and industrial leaders,

professional men and women, bankers, newspapers, radio stations,

and thousands of other volunteer workers will commence their

house to house campaign

(The f o llo w in g a d d re ss by S e c r e t a r y Snyder kedboKaxnx a t th e
R e g io n a l f e t i n g o f S o u th w e ste rn B a n k e r s , t o be h e ld a t th e
H o tel P a s Q ^ j^ lB L d e jL J ^ 't © » E l P a s o , T e x a s , i s sc h e d u le d , f o r
d e l i v e r y a t^ lli^ A .M« ^tST^ a x A p r i l 9 , 1 9 4 8 , ana i s r o r r e l e a s e
a t t h a t time*

©6

T7~t I

11 AM, C.SlTf

7

1

TREASURY DEPARTMENT
Washington
(The following address by Secretary Snyder at the
Regional Meeting of Southwestern Bankers, to be
held at the Hotel Paso del Norte, El Paso, Texas,
is scheduled for delivery at 11:00 M t
April 9, 1948, and is for release at that time,)

"ECONOMIC COOPERATION —

A DEFENSE TO AGGRESSION"

Geographic decentralization of American industry has conspicuously
marked the progress of economic stabilization in the United States
within the last ten years* The Southwest has particularly benefited by
this diversification.
This trend is strongly evidenced in banking, population, and produc­
tion figures.
The coming of age of this part of the country has been a healthy
development for'the Nation. It has resulted in a better balanced and
more resilient economy.
The economic importance of the Southwest is enhanced by its position
so near to the center of our security zone. The vast extent of this area,
and the opportunity which it affords for industrial deployment, make it
a priceless national asset.
You bankers have materially contributed to the growth of this
territory, have shared in it, and have unmistakably profited by it,
Ten years ago, in the States of Arizona, New Mexico, and the western
part of Texas, there were 102 banking offices. At the present time, there
are 127. Ten years ago, the total resources of these banks were $200
million. Today they are $962 million — an expansion of nearly five
hundred percent. Ten years ago, loans extended by banks in the area
represented by this group, aggregated $60 million. Today they are at a
peak of $300 million.
These $re more than just cold figures. They mirror a decade of the
phenomenal growth which has taken place in the Southwest — a growth
which has not even begun to exhaust the potentialities bf this territory*
These figures represent production in industry and agriculture that
contributed directly and effectively, to victory in war, and to expansion
in postwar business. In part, they have resulted from money expended for
reclaiming and replenishing of the soil. The. great dams that have been
built to store up and distribute -water over this vast area have made
possible a more prosperous agriculture and have attracted a greater
variety of industry.
As bankers and as active participants in this impressive business
expansion of the Southwest, you are particularly concerned with ways and
means of fostering an ever—increasing augmentation of American industry
and trade. You are fully aware of the importance of a constructive trade
development program to our continued business prosperity,
S-682

~ z —
The sound growth of the Latin American Nations m i l increasingly
enlarge.our own volume of trade and economic activity. Past experience
shows that the industrialization and general' advancement of any country
with whom we trade result in better markets for United States goods,
and greatly contribute toward our own productivity.
An examination of United States foreign trade statistics shows that
the Southwest has a large share of our foreign business. Exports passing
through the customs districts of El Paso and Arizona were $74 million in'
1947, an increase of about 600 percent over the 1939 figures of $10.4
million.
Added to the benefits derived from commodity exports is your special
community interest in the tourist trade. The facilitation of tourist
travel will be all important in the patronage of the thousands of
Americans who pass through your states and counties on the way south.
While United States business and banking interests have been making
notable progress, governments in Latin America have also been accentuating
their own efforts toward economic diversification and increased produc­
tivity. In spite of very serious obstacles, such as shortages of machinery
and capital, and the need for establishing new patterns of development,
there has recently been a substantial advancement in the Latin American
republics.
Programs for greater development, and closer inter—American coopera­
tion, are today receiving serious consideration at the assembly of nations
now gathered at Bogota, Colombia, . This Ninth International Conference of
American States is carrying forward the notable series of Pan American
meetings which began in 1890. Prom these periodic conferences, a system
of international relationships has evolved which is unique in the world,
and which will remain a memorial to the accomplishments of peaceful joint
consultations among the twenty-one American Republics, It is expected
that at the present conference, agreements reached to make effective
economic cooperation will, as one result, make possible a future intensified
growth of production, employment and technical developments in Latin America.
While nearly all of the Latin American countries have ambitious plans
for more fully utilizing their vast resources, stimulating production, and
increasing tourist trade, the plans of Mexico are perhaps most familiar to
you* As you know, the Mexican government is vigorously promoting a program
for continued expansion of highways, thus encouraging tourist travel and
trade. It is actively promoting the expansion of electric power production
necessary to keep pace viith the growing needs of commerce and industry. A
series of great irrigation projects are being charted to transform some of
Mexico's desert or semi-arid regions into highly productive agricultural
lands.
The Mexican Government is also taking steps to develop and utilize
more of its petroleum resources, both for the growing export demand and
the ^expanding Mexican domestic requirements. Further, it is planning
additional railway and port facilities to handle the expanding flow ofgoods.
S-682

~ 3 The Export— Import Bank of Washington has helped materially in the
financing of Latin American economic development* Total credits of
over $1 billion have been authorized for Latin America since the
inception of the Bank* with about $j900 million of that total coming in
the period after July 1, 1940» The Administration is now proposing
that the Congress increase the lending power of the Export-Import Bank
by |500 million, to make possible the continuance of credits to Central
and South America«
The International Bank for Reconstruction and Development is also
extending its loan operations to Latin America«
Because of its close proximity to this area, I will again use
Mexico as an example in citing certain of the mutual benefits of economic
cooperation« Export-*-Import Bank credits already mentioned have aided the
development of Mexico's steel, petroleum and electrical industries, its
highways and railways, its sugar mills, meat canneries and other activ­
ities representing a good cross section of the business of the country.
The United States-Mexican Stabilization Agreement, signed in 1941
and renewed in 1947, has contributed much to ¿reate an atmosphere of con­
fidence and stability in which steady economic progress can be maintained«
Commercial relations between modern governments are never simple
and easy, and those of the United States with Mexico are no exception«
It is not an exaggeration to say, however, that the reciprocal trade
agreement signed in 1942 by our two governments has helped to steady these
difficult relations and to establish tariff rates along lines beneficial
to the general interests of both countries« Our two Governments have
recently agreed to discuss revision of the 1942 Trade Agreement to iron
out inequities which have developed since its adoption. I am confident
that reasonable modifications can be made which.will protect the essential
interests of both countries and provide a framework for further expansion
of the volume of trade between them*
Mexican economic requirements are, of course, far beyond what can be
properly provided by international trade* In particular, the Mexican
economy needs United States capital and United States technology. The
Mexican Government is fully aware of these needs, and in recent years has
ia «?n .cons^ruc^^ve s^ePs
encourage foreign capital investments«
Definitely, its settlement of the defaults on the external public debt
and the external railway debt, its agreements with the United States and
British petroleum interests, and the agreements on revolutionary and
agrarian claims are evidence of Mexico's intention to give fair treatment
to foreign capital. In view of these and other developments, there has
been an appreciable flow of private capital to Mexico. It is hoped that
the situation will continue to improve, and that U. S. enterprises can
e p n Mexico's economic growth, as well as in the growth of the entire
western hemisphere.
Concurrently with our growing interest in international trade,
attention must be given to the impingement of our Federal tax laws upon
our international trade programs. The Treasury has constantly^ under
S-682

- 4 study, provisions to lessen the friction of Federal taxes in every
•way consistent With the financial integrity of the government, the
stability of our economy, and the fair distribution of the tax burden*
In my opinion, one way in •which a revision of the tax laws can
properly contribute to our foreign economic program is exemplified by a
bill now pending in the Congress which would increase the duty-exemption
on goods brought into the United States by returning American tourists#
American tourist-travel abroad has long constituted an important
source of dollars to foreign countries. During the period between the
two World Wars, American tourists spent abroad annually between 309 and
600 million dollars. These expenditures represented more than 10 per
cent of American imports, and thus supplied foreign countries with more
than 10 per cent of their dollar exchange. Today our national income is
far above that of the highest of pre-war years, and it is safe to antici­
pate that with proper encouragement the annual expenditures of American
tourists abroad will rise to more than a billion dollars. If this
anticipation should be realized, it would help to alleviate the world­
wide dollar shortage#
The current $0.00 duty-exemption on goods brought into the United
States by returning tourists is generally considered to be too low. A
pending bill in the Congress, if enacted into law, would increase this
exemption to $500»
Another recommendation to reduce the friction between the collection
of Federal revenues and our foreign economic program is in the extension
of bilateral tax conventions with foreign countries. Today we have
actually in effect comprehensive income tax conventions with Canada, the
United Kingdom, France and Sweden, and estate tax conventions with Canada
and the United Kingdom# Moreover, treaties with France and the Union of
South Africa, covering both income and estate tax problems, are now
pending before the Senate#
No two of thede instruments are identical# ' Some of their provisions
are for the beriefit of the contracting governments, others are for the
benefit of the citizens or residents of each country, who have income
or property subject to the jurisdiction of the other# Common to most of
them is the aim to minimize the double taxation of income and estates;
to simplify the administration of the tax laws, where the taxpayer is
subject to the tax jurisdiction of both governments; to insure against
phanges in the tax laws of one country as they affect citizens of the
other; and to facilitate the collection of taxes, where tax jurisdiction
is divided*
The success of this tax convention program to date has itself been
the greatest inducement for its further extension, Discussions have already
been held with the Benelux countries and Denmark, with New Zealand, and
with Mexico and other Latin-American countries. We earnestly hope that
these discussions will ripen into agreements similar to those to which I
have just referred. "
S-682

- 5 ~ '
Another phase of the Treasury’s attack on this same problem is a
systematic reexamination of our own tax treatment of American citizens
and corporations doing business abroad.
The general policy of the tax laws at the present time is to make
no special concessions to taxpayers engaged in business activity outside
the United States. American citizens and American corporations are, in
general, taxed on their entire income whether derived from domestic or
from foreign sources. There are. in the tax laws, however, a few
provisions of limited scope which were‘ specially designed for the benefit
of such taxpayers*
Of interest in connection with the Bogota Conference, is the fact
that the Treasury-has under consideration a number of modifications and
interpretations of present laws which might serve to furnish additional
incentives to inter—Araericah trade*
The problem of taxing Americans doing business abroad involves
various and important considerations, chief among which is the desire to
encourage the proper flow of private American investment funds into
foreign markets.
Tax considerations, however, are only one phase of the entire problem
involved in the promotion and development of international trade. Further,
international trade is only one consideration of our internal economy*
We must so shape our internal affairs that the United States will
continue to be strong*
To attain this end, we must make sensible use of our natural
resources, through an effective system of private enterprise,' and through
equitable tax provisions which will permit the greatest possible incentives
to business growth# We must have a free and ample flow of private capital,
under conditions which afford such capital and initiative proper safeguards*
For these reasons, common to us all, the United States and other
independent nations are today seriously engaged in negotiations to remove
those obstacles and restrictions to mutually advantageous commercial
relations0
The agreement reached by fifty nations on the Charter for an
International Trade Organization is a constructive and worthwhile frame­
work for efficient economic cooperation* We have good reason to hope
that the inter—American conference at Bogota will further develop
effective agreements toward the balanced growth and stability of inter­
national economic relations.
We intend to demonstrate that the Good Ne ighbor policy of voluntary,
strong economic cooperation can be a potent instrument in defeating
totalitarian intimidation, aggression and domination.

0O 0
S-682

• m m m mmrmrn
Washington
tot sslsasb, w m x m immväpms,
Tuesday, April 6, 1048«_______

Press Servio«

6f_3

The secretary of tii« Treasury announced last evening that thm tenders for

JSTi?^1V* i>;.:;fe:’■'’;.,*u \ v : v;;v

'

#1,200,000*000» or there&bouta, of 91-day Treasury till* to be dated April 8 and to
»aturo July 8» 1948, «blob «oro offered April 2* 1948» miro opened at ti» Federal Re­
serve Banke on April 9«
The detail» of this Issue are a» folio»»:
Total applied for
Total aeeepted
Average prie#

#1,793,395,000
1,205,442,000 (include» #39,045,0007entered on a non­
competitive basis and accepted In full at
7
the average price atoen below) /
99«748 Equivalent rate of discount approx. 0.997$ per annum

tange of aeeepted seopetitivs bid*!
Sigb

• 99.756 Equivalent rate of diaconat approx:« 0.965$ par annum

low

- 99«7477

*

*

»

»

»

1,001$7 •

*

(94 percent of the amount bid for at ti» low price was accepted)

Federal Reserve
District

Total
Applied for

fetal
Accepted

Boston
Hew Text
Philadelphia
Cleveland
Blehaond
Atlanta
Chicago
St. Ionia
Minneapolis
Sanaa» City
Dalla»
Ban Francisco

$ »,978,000
1,533,369,000
53,680,000
13,140,000
8,889,000
6,590,000
103,116,000
3,099,000
4,459,000
15,986,000
8,795,000
68t574|000

#

forai

#1,793,535,000

17,748,000
999,949,000
16,415,000
15,140,000
5,699,000
9,650,000
71,900,000
2,897,000
3,443,000
14,816,000
8,657,000
48.794.000

#1,205,445,000

TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Tuesday, April 6, 1948,________

Press Service
No . 'S-,6 8 3

The Secretary of the Treasury announced last evening that
the tenders for $1,200,000,000, or thereabouts, of çi^ct&y
Treasury bills to be dated April 8 and to mature July 8, 1948,
which were offered April 2, 1948, were opened at the Federal
Reserve Banks on April 5.
The details of this issue are as follows:
Total applied for ~ $1,793,333,000
Total accepted
- 1,205,442,000 (includes $39,0^5,000 entered
on a non-competitive oasis and accepted in
fullI at the average price shown below)
Average price - 99*748 Equivalent rate of discount approx. 0.997$
per annum
Range of accepted competitive bids:
High - 99*756 Equiv. rate of discount approx . 0 .9 6 5 $ per annum
ft
f!
ft
Low - 99.747
M
"
1 .0 0 1 #
"
"
(54 percent of the amount bid for at the low price was accepted)
Federal Reserve
District
Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
S t , Louis
Minneapolis
Kansas City
Dallas
San Francisco

Total
Applied for

Total
Accepted

1 7 ,9 7 5 ,0 0 0
1 ,5 2 3 ,3 6 9 ,0 0 0
2 3 ,680 ,-00 0
1 5 ,1 ^ 0 ,0 0 0

$

2,659,000
6 ,5 5 0 ,0 0 0
1 0 3 ,1 1 6 ,0 0 0
3,035,000
4,455,000
1 5 ,9 8 5 ,0 0 0
8 ,7 9 5 ,0 0 0
68,574,000

1 7 ,7 ^ 5 ,0 0 0
999,949,000
16,412,000
15,140,000
2 ,6 5 9 ,0 0 0
3 ,6 3 0 ,0 0 0
7 1 ,3 0 0 ,0 0 0
2 ,8 9 7 ,0 0 0
3 , ^ 3 ,0 0 0
1 4 ,8 1 6 ,0 0 0
8 ,6 5 7 ,0 0 0
48,794,000

$1,793,333,000

$1,205,442,000

$

TOTAL

0O0

STATUTORY DEBT LIMITATION
AS OF MARCH 31, 1948

E U c a l Service n
Wachingbgg, AprilJJ^ ,'1943

Section 21 of the Second liberty Bond Act, as amended, provides that the face amount
of obligations issued under authority of that Act, and the face amount of obligations
guaranteed as to principal and interest by the United States (except such guaranteed
obligations as may be held by the Secretary of the Treasury), «shall not exceed in the
aggregate $275>000,000,000 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 shall be considered as its
face amount.“
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 out standing at any one time
Outstanding
Obligations issued under Second Liberty Bond Act, as amended
Interest-bearing
Treasury bills................ . $ 13r945,345,000
Certificates of indebtedness....
20 ,330*747*000
16.474.766.900 $ 50,750,858,900
Treasury notes.... ..........
Bonds
. Treasury.....................
115,523,947,500
Savings (current redemp.value)
52,988,095,101
Depositary...................
316,852,000
Armed Forces Leave...........
648,389,425
Investment Series.............
969,920,000 17 0 ,^+7 ,20^,026
Special Funds
Certificates of indebtedness..
14,850,350,000
Treasury notes....... .......
143 421,309.000
Total interest-bearing.............. .
Matured, interest-ceased
Bearing no interest
War savings stamps.... .
60,237,196
Excess profits tax refund bonds.
10,375,850
Special notes of the United.States:
Internat* 1 Bank for Reconst,
and Development series......
115 ,785,000
Internat*1 Monetary Fund series
1,184,000,000
Total..*............ .......•••.••..7
Guaranteed obligations (not held by Treasury)
Int erest-bearing
Debentures: F.H.A. .............
27,925,636
Demand obligations: C.C.C. .....
45,171,663
Matured, interest-ceased.•••••••••••••*•••••••*.•••

^275,000,000,000

, 29,271,659,000
250,469,721,926
312,545,183

1,370,398,046
252,152,665,155

73,097,299
5,057,025
78,154,324

Grand total outstanding«
Balance face amount of obligations issuable under above authority........

. .

2 5 2 2 3 0 819,479

22 ,769 r180 ,521

Reconcilement with Statement of the Public Debt - March 31, 1948
(Daily Statement of the United States Treasury, April 1 , 1948)
Outstanding Total gross public debt........................... ....... .
Guaranteed obligations not owned by the Treasury..................
Total gross public debt and guaranted obligations...... ..............
Deduct - other outstanding public debt obligations
not subject to debt ^ m i t ation..... ......................... .

252 ,989,915,421
78.,154j324

253,068,069,745
..... 837 .2 ^0*266
$252,230,819^7?

STATUTORY DMBT LIMITATION
AS OF MARCH 31, 1948

April 7, 1948

Section 21 of the Second Liberty Bond Act, as amended, provides that the face
amount of obligations issued under authority of that Act, and the face Amount of ob­
ligations guaranteed as to principal and interest by the United States (except such
guaranteed obligations as may be held by the Secretary of the Treasury), 11 shall not
exceed in the aggregate $>275>000,000,000 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 shall be con­
sidered as its face amount.”
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
$275,000,000,000
Outstanding
Obligations issued under Second Liberty Bond Act, as amended
Interest-bearing
Treasury bills.*..,....... $> 13,945,345,000
Certificates of indebtedness
20,330,747,000
Treasury notes........ .
16,474.766,900 $ 50,750,858,900

Bonds
Treasury...................... . . . , .
Savings (current redemp. v alu e)
D e p o sitary .••••••••••••«
Armed Forces L e a Y e ,... . •
Investment S e r i e s . . . . . . .

1 1 5 ,5 2 3 ,9 4 7 ,5 0 0
5 2 ,9 8 8 ,0 9 5 ,1 0 1
316,8 5 2 ,0 0 0
648,389,425
9 6 9 ,9 2 0 ,0 0 0

Special Funds
Certificates cf indebtedness
14,850,350,000
Treasury n
o
t
e
s
14,421,309,000
Total i n t e r e s t - b e a r i n g ....
Matured, i n t e r e s t - c e a s e d ..... .
Bearing no interest
War savings s
t
a
m
p
s
60,237,196
Lxcess profits tax refund bonds
1 0 ,375,8 50
Special notes of the United States:
Internat1! Bank for neconst.
and Development series
115,785,000
InternatT1 MonetaryFund Series
1,184.000,000
Total ......................
Guaranteed obligations (not held by Treasury)
Interest-bearing
Debentures: F. H, A......
27,925,636
Demand obligations: C.C.C.
45,171,663
Matured, interest-cea-sed,,,..,.,.
.
.

170,447,204,026

29,271,659,000
250,469,721,926
312,545,183

1,370,398,046
252,152,665,155

.

73,097,299
5,057,025
78,154,324

252,230,819,479
Grand total outstanding.
,....^........
Balance face amount of obligations issuable under above authority».. 22,769,180,521
Reconcilement with Statement of the Public Debt — March 31, 1948
(Daily Statement of the United States Treasury, April 1, 1948)

Outstanding Total gross public debt.
252,989,915,421
Guaranteed obligations not owned by the Treasury#,,.,• .4.V., • f>".V____ 78,154,324
Total gross public debt and guaranteed obligations...,.,'.......... 253,068,069,745
Deduct — other outstanding public debt obligations
not subject to debt limitation..,...»»......................
837,250,266
‘ ^252.230,819,479

S-684

TREASURY DEPARTMENT
Bureau of Internal Revenue

For Releasei
April , 1948

Frees Servios
2

»o*

- LB

George J. Schoeneman, Commissioner of Internal Revenue, announced today
the appointment of William 0« Thompson as a member of the gxeess Profits fax
Connell, effective immediately«
Mr. Thompson, who is a practicing attorney, has had a side variety of
experience.
iB 1

Me Is 50 years old and a native of Chicago«
A

e Mavy throughout World War X X ^ Since then he has been

practicing law In Doncaster, Pennsylvania.
he held seret

He served in the Army

Among the many prior positions shich

Professor of law at Temple Univereity, 1933-1941* Tax Division,

United State« Department of Justice, 1930-1933| Private practice, Philadelphia,
1928-19301 and secretary to the late Justice Alex Simpson Jr. of the Pennsylvania
Supreme Court, 1924-1927«

He was graduated from Pennsylvania State College with

the degree of Bachelor of Science ^ - 4 9 2 # a n d received hie law degree^from Temple
University in 1927«

TREÂ5ÜKÏ DÈPARTMENT
Bureau of Internal Revenue
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Friday, April 9, 1948,

Press Service
No. S - 6 8 5

George J . Schoeneman, Commissioner of Internal Revenue,
announced today the appointment of William C. Thompson as a
member of the Excess Profits Tax Council, effective immediately*
Mr* Thompson, who is a practicing attorned, has had a
wide variety of experience.

He is 50 years old and a native

of Chicago * He served in the Army in World War I as a second
lieutenant and in the Navy throughout World War II, attaining
the rank of captain*

Since then he has been practicing law

in Lancaster, Pennsylvania. \
Among the many prior positions which he held were:
Professor of law at Temple University, 1933-19.41; Tax: Division,
United States Department of Justice, 1930-1933; Private prac­
tice, Philadelphia, 1928-1930; and secretary to the late
Justice Alex Simpson, Jr. of the Pennsylvania Supreme Court,
192^-1927.

He was graduated from Pennsylvania State College

with the degree of Bachelor of Science as a member of the class
of 1 9 1 9 and received his law degree with high honors from
Temple University in 1 9 2 7 .

0O0

of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be -considered to be interest.

Under Sections l\2 and

117 (a) (1) of the Internal Revenue Code, as amended by Section ll£ of the Reve­
nue Act of 19hX, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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. I4.I8 , as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

'M i f&kr

Ti.afcii

-

2

-

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 Secretary of the Treasury 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 ary one bidder will be accepted in full at the
average price (in three decimals) of accepted competitive bids.

Settlement for

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

April If?, 19U8_____, in cash or other immediately avail-

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders will receive equal treatment.

April 1
19U6
" d ® 2------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, shall not have ary exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, whether Federal or State, but shall, be exempt from all taxation now or
hereafter imposed on the principal or interest thereof by any State, or ary of the
possessions of the United States, or by any local taxing authority.

For purposes

WMX
TREASURY DEPARTMENT
Washington

Ù,

FOR RELEASE, MORNING NEWSPAPERS
Friday, April 9, 19U8.

of the Treasury, by this public notice, invites tenders for
or thereabouts, of

91 -day Treasury bills, for cash and

in exchange for Treasury bills maturing
April 15>, I9I4.8
, to be issued on
x .
T O
a discount basis under competitive and non-competitive bidding as hereinafter
provided.

The bills of this series will be dated

8hh|IraHKBi

. I¡¡I
-r

will mature July l£, 19U8
interest.

¡tf |

April 1

'I ~i /1

19k8

____ , and

M

\^\

, when the face amount will be payable withoi
without

They will be issued in bearer form only, and in denominations of

Tenders will be received at Federal Reserve Banks and Branches up to the
closing hour, two o Tclock p.m., Eastern Standard time,

Monday, Aoril 12, 19k8

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.
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

TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Friday, April 9, 1948 ______ N o . S- 6 8 6

Press Service

The Secretary of the Treasury, by this public notice, in­
vites tenders for $1 ,0 0 0 ,0 0 0 ,0 0 0 ,tor "thereabouts, ^0 fr.9 1 -day
Treasury bills, for cash and in exchange for Treasury bills
maturing April 15, 19^6, 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 15, 19^8, and will
mature July 15, 19^8, when the face amount will be payable
without interest. They will be issued in bearer form only,
and in denominations of $1 ,0 0 0 , $ 5 ,0 0 0 , $1 0 ,0 0 0 , $1 0 0 ,0 0 0 ,
$5 0 0 ,0 0 0 , and $1 ,0 0 0 ,0 0 0 (maturity value).
Tenders will be received at Federal-Reserve Banks and
Branches up to the closing hour, two o ’clock p.m., Eastern
Standard time, Monday, April 12, 19^8. Tenders will not be
received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1 ,0 0 0 , and in the case.of
competitive tenders the price offered must be expressed on
the basis of 1 0 0 , 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.
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 Secretary of the Treasury
of the amount and price range of accepted bids. Those submit­
ting 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. Sub­
ject to these reservations, non-competitive tenders for $ 2 0 0 ,0 0 0
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

2
Bank on April 15, 1948, in cash or other immediately available
funds or in a like face amount of Treasury bills maturing.
April 15, .19^8, Cash and exchange tenders -will receive equal
treatment. Cash adjustments will be made for.differences
between t&e 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, shhll
not have any exemption, as such, and loss from the sale or other
disposition of Treasury bills shall not have any special treat­
ment, as such, under the Internal Revenue Code, or laws aniendatory or supplementary thereto. The bills shall be subject to
estate, inheritance, gift or other excise taxes, whether Federal
or State, but shall be exempt.from all taxation now or here­
after 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 shall b e .considered to be interest. Under Sections
42 and 117 (a) (l) of the Internal Revenue Code, as amended
by Section ii5 of the Revenue -Act of 194-1, the amount of discount
at which bills issued hereunder are sold shall not be considered
to .accrue until such bills shall be -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/ as amended, 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

TREASBK? DEPARTMEMT
lu ld fig to x t

K m nLiâsi, m m xm m m m m m ,

Frees Service

Tuesday, April 13* 1 9 4 8 , ______

The S M ü U x j r of the Treasury announced last evening that the tenders for
#1,000,000,000, or thereabouts, of 91-day Treasury hills to he dated April Id and to
nature July 15, 1948, which were offered April 9, 1948, were opened at the Federal Re­
serve Basics on April IB*
The detalle of this Issus are as follows;
Total applied for - *1,474»054,000
Total accepted
* 1,004,487,000 (includes *57,718,000 entered on a non*
competitive hasis and accepted In full
at the average price shown below)
Average pries
- 99*748 Equivalent rate of discount approx. 0.99851 per annua
Range of accepted competitive bids;
- 99.754 Equivalent rate of discount approx* 0.975$ per asna»
«
- 99*747
*
«
«
»
*
1.001$ m

High
low

(70 percent of the aaownt hid for at the low price was accepted)

federal Reserve
District

«fetal
Applied for

Total
Accepted

Boston
Hew York
Philadelphia
Cleveland
1lehnend
Atlanta
Chicago
St* Louis
Minneapolis
Kansas City
Dallas
San francisco

1

*

TOTAL

7,889,000
1,254,£53,000
28,850,000
15,850,000
5,420,000
5,075,000
51,529,000
2,110,000
4,255,000
39,758,000
5,440,000
55*745.000

11,474,094,000

8,319,000
857,415,000
16,900,000
19,880,000
• 9,870,000
4,479,000
94,684,000
8,080,000
3,970,000
96,001,000
5,570,000
41.1«.000

#1,006,487,000

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
T u e s d a y , April 13, 1948._______

Press Service
N o . S- 6 8 7

The Secretary of the Treasury announced last evening that
the tenders for $ 1 ,0 0 0 ,0 0 0 ,0 0 0 , or thereabouts., of 9 1 -day
Treasury bills to be dated April 15 and to mature July 15 ,
1948, which were offered April 9> 19^8* were opened at the
Federal Reserve Banks on April 12 .
The details of this issue are as follows;
Total*applied for - $1,474,034,000
Total accepted
- 1,006,487,000 (includes $37,715,000 entered
on a non-competitive basis and accepted
in full at the average price shown below)
Average price - 99*748 Equivalent rate of discount approx. 0.998$
per.annum
Range of accepted competitive bids:
High - 99.754 Equiv. rate of discount approx. 0.973$ per annum
M
Low - 99.747
"
1.001$
ft

11

rt

It

it

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

Total
Applied for

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

$

TOTAL

7 ,5 2 9 ,0 0 0
1 ,2 5 6 ,2 5 3 ,0 0 0

Total
Accepted

28,850,000
1 5 ,8 5 0 ,0 0 0
3,420,000
5,075,000
51,529,000
2 ,1 1 0 ,0 0 0
4 ,2 5 5 ,0 0 0
3 9 ,7 5 8 ,0 0 0
5 ,6 6 0 ,0 0 0
5 3 ,7 4 5 ,0 0 0

5,319,000
837,413,000
1 6 ,9 0 0 ,0 0 0
1 5 ,8 2 0 ,0 0 0
3 ,2 7 0 ,0 0 0
4,475,000
34,584,000
2 ,0 2 0 ,0 0 0
3 ,9 7 0 ,0 0 0
3 6 ,0 0 1 ,0 0 0
5,570,000
41,145,000

$1,474,0 3 4 ,000

$ 1 ,006,487,000

oOo

$

G\

Secretary Snyder issued the following statement today;

”On behalf of theftTreasury, I want to express sincere
appreciation to the nation*s newspapers, magazines, radio
and television stations, the motion picture industry, and
like media for the splendid-support and cooperation which
they have rendered in the launching of the Security Loan
Drive,
WI have read a great many of the editorials and newsstories that appeared in our newspapers in support of the
Drive, and have found them to be exceptionally fine
presentations,

I am quite impressed, also, not only with

the amount of space which magazines have donated, but with
the quality of their offerings,
"Radio and television stations throughout the country
are enthusiastically and conscientiously bringing the Drive
to the attention of every American citizen.

And, of course,

the accomplishments of the motion picture industry and theatres
in bringing the Security Loan message to their patrons
has been invaluable m

xx

this accelerated drive of the Treasury*s

U. S. Savings Bond program,”

TREASURY DEPARTMENT
Washington

FOR IMMEDIATE RELEASE
Friday, April 16. i q a b

Press Service
No. S-688

Secretary Snyder issued the following statement today:
”0n behalf of the president and the Treasury, I want to'express
sincere appreciation to the nation’s newspapers, magazines, radio
and television stations, the motion picture industry, and like media
for the splendid support and cooperation which they have rendered
in the launching of the Security Loan Drive*
nI have read a great many of the editorials and news stories
that appeared in our newspapers in support of the Drive, and have l
found them to be exceptionally fine presentations.
I am.quite
impressed, also, not only with the amount of space which magazines
have donated, but with the quality of their offerings.
nRadio and television stations throughout the country are
enthusiastically and conscientiously bringing the Drive to the atten­
tion of every American citizen. And, of course, the accomplishments
of jhe motion picture industry and theatres in bringing the Security
Loan message to their patrons has been invaluable in this accelerated
drive of the Treasury’s U* S. Savings Bond program.”

0O 0

n

'Ä,(i
T m m m m&Ásmm
IhaMljlCB

901 s e ñ e * , m m x m n^sFAmm,
Taesday, April 20, 1948*

Freiis Service
5--6 * 7

The seeretary of the Treasury an&onaeed last eveniag that the tender» for
#1,000,000,000, or thereaboute, of 91-day Treaauxy bilis to be dated April 22 and to
» t u r » July 82, 1948, whieh aere offered April 14, 1948, were opened at tha Federal Peserv© Banks on Aprll 19.
fbe detalla of Ibis lasos ara as follona:
total applied for - #1,691,144,000
total accapted
- 1,001,226,000 {ineludes #42,814,000 «atorad oa a aon-cciapstltii
basls and aocepted la full at tbo average
prisa abona balear)
Average prlss
~ 99*948 Equivalen! rata of dlseount approx. 0*999$ por »nm*»
Bango of aoeoptod cospetitlve blds:
Eigb
Lo*

* 99.954 Equivalen! rota of dlseount approx. 0*992# por sanan
- 99*949
*
•
*
*
*
1*001$ *
*

(98 parosnt of tbo amouat bld for at tbo loo prloo oas aeooptod)

fodoral Reserve
District

Total
Applied for

Total
Accepted

Boston
lew Tork
Philadelphia
Cleveland
Riehoond
Atlanta
Obleago
St. Loáis
Minneapolis
Bbnses City
Dallas
San Francisco

i

•

•1,3*1,148,000

#1,001,226,000

10,780,000
1,495,455,000
55,985,000
51,950,000
5,495,000
3,815,000
38,8*0,000
2,004,000
2,895,000
10,855,000
3,810,000
91.544*000

TOTAL

«r:

10,780,000
838,745,000
14,589,000
26,422,000
5,599,000
5,215,000
56,964,000
1,860,000
2,151,000
10,599,000
5,810,000
44.944.000

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS
Tuesday, April 20, 19*1-8«_______

Press Service
No. S - 6 8 9

The Secretary of the Treasury annouhced last evening that
the tenders for $ 1 ,0 0 0 ,0 0 0 ,0 0 0 , or thereabouts, of 9 1 -day
Treasury bills to be dated April 22 and to mature July 22, 1948,
which were offered April 16, 1948, were opened at the Federal
Reserve Banks on April 1 9 .
The details of this issue are as follows:
Total applied for - $1,691,144,000
Total accepted
- 1,001,226,000.(includes $42,816,000 entered
on a non-competitive basis and accepted in
full at the average price shown below)
Average price - 99*748 Equivalent rate of discount approx. 0,997$
per annum
Range of accepted competitive bids:
High - 99*754 Equiv. rate of discount approx. 0.973$ per annum
Low - 99.747 "
"
"
"
"
11001$ M
M
(52 percent of the amount bid for at the low price was accepted)

Federal Reserve
District_______

Total
Applied for

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

$

1 0 .7 5 0 ,0 0 0
1,453,633,000
35.725.000
31.750.000

5.475.000
3.215.000
58,290,000

2.004.000

TOTAL

Total
Accepted
$

1 0 ,7 5 0 ,0 0 0
838,745,000
14.589.000
26.422.000
5.379.000
3.215.000

36.764.000
1 ,8 6 0 ,0 0 0

2 .2 9 5 .0 0 0

2,151,000

10,853,000
5 ,8 1 0 ,0 0 0
71,344,000

10.597.000
5 ,8 1 0 ,0 0 0
44.944.000

$1,691,144,000

$ 1 ,0 0 1 ,2 2 6 ,9 0 0

0O0

TREASURY DEPARTMENT
Washington

FOR REIiASE, MORNING NEWSPAPERS
ErMay. April 16, 19Z.8_________

Press Service
No. S -690

The Treasury Department announced today the revocation of
General License No* 49 which authorized certain transactions
prohibited under the freezing regulations if such transactions
were by, or on behalf of, Sweden or any national thereof. This
action, taken in consultation with the Government of Sweden, was
provided for in the defrosting arrangement which led to the
inclusion of Sweden in General Licenses Nos. 94 and 95.

TREASURY DEPARTMENT
Washington

EOR RELEASE, CORNING NEWSPAPERS
Friday3 April 16, 1948______ ______

Press Service
No, S-690

The Treasury Department announced today the revocation of
General License No, 49 which authorized certain transactions
prohibited under the freezing regulations if such transactions were
by, or on behalf of, Sweden or any national thereof.

This action, -

taken in consultation with the Government of Sweden, was provided for
in the defrosting arrangement which led to the inclusion of Sweden in
General Licenses Nos. 94 and 95*

oOo

ftr

COTTON WASTES
( In pounds)
COTTON CARD STRIPS made from c o tt o n h av in g a s t a p l e of l e s s th an 1 - 3 / 1 6 in c h e s
in l e n g t h , COMBER WASTE, LAP WASTE, SLIVER WASTE, AND ROVING WASTE, WHETHER
OR NOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUEi Provided, h o w rv er, th a t
n o t more th a n 3 3 - 1 / 3 p e r c e n t of th e q u o ta s s h a l l "be f i l l e d by c o t t o n w a ste s
o th e r th a n comber w a s te s made from c o t t o n s o f 1 - 3 / 1 6 in c h e s o r more in s ta p le
le n g th in th e c a s e o f th e f o llo w in g c o u n tr i e s *
U n ite d Kingdom, F r a n c e ,
N e th e r la n d s , S w itz e r la n d , B elg iu m , Germany, and I t a l y *
•
ft

Established
Country of Origin : TOTAL QUOTA
§

United Kingdom....
Canada.............
France.............
British India.....
Netherlands...t*...
Switzerland.......
Belgium............
J apan..... ........
China..............
Egypt..............
Cuba....... .......
Germany............
Italy..............
Totals

j

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

Total imports
fEstablishedt
Imports
Sept. 20, 1947,j 33-1/3$ ofjSept. 20, 1947,
to. April 3,19U8iTotal Quotas to Apr. 3,
1/
191,81,441,152
19,703
19,703
—
101«,967
—
'
— :
75,807
—
69,627
22,747
14,796
12,853
j
n

\
1
j

25,443
7,088

5,482,509

191«,297

i f Included in total imports, column 2.

-oO o-

1,599,886

I

J

i

t
19,703 j

AljSph

FOR IMMEDIATE RELEASE
April 1 A H - 9 U 6

- 1 -

•I. «rfflt*-'

it

s

The Bureau of Customs announced today that preliminary data on imports of
cotton and cotton waste chargeable to the quotas established by the President’s
proclamation of September 5, 1939» as amended, for the period September 20,
1947, to April 3
1948 , %re ase follows:
COTTON (other than linters)
(In pounds)

Country of
Origin

Under 1-1/8" other
t han r ough or har sh
under 3/4n
Established Imports Sept.
Quota
20, 1947, to
Apr. 3. 1948

Egypt and the
Anglo-Bgyptian “
Sudan
783; 816
P e r u . . . . •247^952
British'India.
2 j003,483
C h i n a . ; 1,370,791
M e x i c o . 8,883,259
Brazil...........
618,723
Union of Soviet
Socialist Repub-'
iics..;.v;:;;.::.
475,124
Argentina.;..;;;;
5,203
H
a
i
t
i
;
237
Ecuador..........
9,333
H o n d u r a s ..;
752
Paraguay..;;...;.
871
Colombia.
124
Iraq............
195
British East
*
' '
Africa.V.........
2,240
Netherlands *East
Indies..
I T . '.
71,388
Barbados.........
Other British...
West Indies l/...
21,321
Nigeria.........
5,377
Other British
West Africa 2/...
16,004
Other French
Africa 3/........
689
Algeria and Tunisia
-

14 ,516,882
1/
2/
3/
4/
5/

247,95>2
19,832

1-1/8” or more
but less than

1- 11/ 16” U
Imports Sept.
20, 1947, to
Apr. 3, 1948

Less than 3/4M
harsh or rough 5/
Imports Sept. 20,
1947 , to Apr. 3,
1948

43,374,472
1,903,999
30,317,038

8,883,239
618,723

249,068

177,949

10,018,834

43,636,420

Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
Other than Gold Coast and Nigeria.
Other than Algeria, Tunisia, and Madagascar.
Established Quota - 45,656,420.
Established Quota - 70,000,000.

30,317,038

TREASURY- DEPARTMENT
Tiashin gton

FOR ME3XATE RELEASE
Thursday. A pril 3,5. 1948

Press Service
No • S—691

The Bureau .of Customs announced today th a t prelim inary data on imports of
cotton and cotton waste chargeable to the quotas esta b lish ed by the. P r e s id e n ts
proclamation o f September 5, 1939, &s amended, fo r the period Septemoer 2 0 , 1947,
to A pril 3 , 1943 in c lu s iv e , are as follo w s*
COTTON (oth er than l i n t e r s )
(in pounds)
* Under 1-1/8» oth er
t l - l / S n or more 1 Less than 374”
: than rough or harsh : but le s s than
; harsh or rough
Country of
;
under 3 / 4 " _______ : l - l l / l 6 ,f 4 /_____ _____________________
Origin
SEstablishedrlm ports Sept.: Imports S e p t, 2 0 , : Imports S e p t. 20,
s
Quota
:2 0 , 1947, t o 5
1947, to
*
1947, to
_______________ *___________ tApr. 3 . 1948s A p ril 3 . 1948
? A pril 3. 1948
Egypt and the
Anglo-Egyptian
783,816
S u d a n ....................
24.7 ,9 5 2
Peru
B rit ish Ind ia . . . . 2 ,0 0 3 ,4 8 3
China
1 ,3 7 0 ,7 9 1
Mexico
8 ,8 8 3 ,2 5 9
B r a z il......... ..
618,723
Union o f Soviet
S o c ia lis t Repub­
lic s .
.
475,124
Argentina ................ •
5,203
Hai bi
.«««.««
237
Ecuador.. .............. ..
9,333
Honduras......... T t. .
752
Paraguay,, . ...........
871
Colombia. . . . . . . . .
124
I r a q «. . . •••
195
B ritish East
A frica
2,240
Netherlands East
71,338
I n d ie s .,..................
Barbados. . . . . . . . .
Other B r itis h
Nest Ind ies l / , . .
21,321
N ig e ria .,...,,.,.
5,377
Other B r itis h
Yfest A frica 2 / , . ,
1 6,004
Other French
Africa 3 / ................
.689
Algeria and T unisia

<r*

2 47,952
19 ,8 5 2

43 , 574,472
1 , 903,999

%

3 0 ,5 1 7 ,0 3 8

. :p

8 , 883,259

618,723
249.068
-

*S'

177,949
-

_
1/
2/
3/
4/

.
1 4 ,5 1 6 ,8 8 2
1 0 ,0 1 8 ,8 5 4
4 5 ,6 5 6 ,4 2 0
Other than Barbados, Bermuda, Jam aica, Trinidad, and Tobago*
Other than Gold Coast and N ig eria.
Other than A lg eria, T u n isia, and Madagascar,
Established Quota — 4 5 ,6 5 6 ,4 2 0 .

5/

Established Quota - 70,000,000.

3 0 ,5 1 7 ,0 3 8

- 2 COTTON WASTES
(In pounds)

COTTON CARD CTRL PS made from cotton having a staple of less than l*-3/l6 inches in
in length, CQ/iBER WASTE, LAP WASTE, SILVER WASTE, AND ROVING WASTE, WHETHER OR
UOT MANUFACTURED OR OTHERWISE ADVANCED IN VALUE s Provided, however, that not
more than 33—1/3 percent of the quotas shall be filled by cotton wastes other
than comber vjastes made from cottons of 1— 3/16 inches or more in staple length
in the case of the follovmng countriest United Kingdom, France, Netherlands,
Switzerland, Belgium, Germany, and Italy5

4'
Established *
Country of Origin :
TOTAL QUOTA *
«
United Kingdom,...f
Canada,,,
France
British India,,
Netherlands.,,,,,,,.
Switzerland
Belgium., , , . , , . ,
Japan
China ^
,
Egypt ,#,«o**«**
Cuba
German,.,,..,...,,
Italy
,,
Totals

Imports
5 Established t
Total Imports
Sept, 20, 1947,
: 33-1/3$ of 5, Sept. 20, 1947
to April 3. 1948 3f Total Quota sto Apr.3.1943l/

4,323,457
239,690
227,420
69,627
68,240
44*338
33,559
341*535
17,322
3,135
6,544
76,329
21,263

19,703
104,967

5,482,509

194,297

1 ,4 4 1,15 2

19,703

75,807
69,627
22,747
14,796
12,853

25,443
7,088

1/ Included in total imports, column 2.

-oOo—

1,599,886

19,703

^

v .■

;

tQ

:.v;.;./:

vX

t fc jU

c^

‘

i C 'r!" ' l

'

POR IMMEDIATE RELEASE,
Q"-^<VW-ApriX

lft-19U8
¿0

The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and wheat flour entered, or withdrawn from warehouse,
consumption under the import quotas established in the President’s proclaim
of May 28, 1941, as modified by the President’s proclamations of April 13,
and Apfil 29, 1943, for. the 12 months commencing May 29, 1947, as follows

Wheat
Country
of
Origin

Established
Quota
(Bushels)

Canada
795,000
China
—
Hungary
— :.
Hong Kong
—
Japan
United Kingdom
100
Australia
—
Germany
100
Syria
100
. —
Hew Zealand
—
Chile
Netherlands
100
Argentina
2,000
Italy
100
Cuba
Prance
1,000
Greece
Mexico
100
..
Panama
«.
Uruguay
Poland and -Danzig
Sw ed en
Yugoslavia
Norway
Canary Islands
Rumania
1,000
Guat emala
100
Brazil
100
Union of Soviet
Socialist Republics
100
Belgium
100

Imports
:May 29 , 1947, -to
•
•April
19l±8
(Bushels)
a?
—
- ■
—

■—
-

.- —
—
-

wm

—

mm

—

—

—

mm

-

mm

~

800,000,

—

;•
•
-• '
J Wheat flour, semolina,
i
crushed or cracked
:
wheat, and similar
*
wheat uroducts
lEstablished V
Imports
i
Quota
i May 29, 1947,
i to April 3. 15
(Pounds)
(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

1,388,155

5,600
■1,760
;■■ —
f¡If*
-7
/

/ :

f

-

—

A

—

mm

—

—

-

-

—

*■ *

**•

617
~oOo~

4,000,000

'

■*

*'
,

-

1,3 9 5 ,5 15

TREASURY DEPARTMENT
Washington

FOR IMMEDIATE RELEASE
Thursday« April 15. 1948

Press Service
No0 S-692

The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and wheat flour entered, or withdrawn from warehouse, for
consumption under the import quotas established in the President’s proclamation
of May 28, 1941, as modified by the President’s proclamations of April 13, 1942,
and April 29, 1943* for the 12 months commencing May 29, 1947, as follows:

Wheat
Country
of
Origin

Established
Quota
(Bushels)

:
Imports
: May 29, 1947, to
s April 3. 1948
(Bushels)

795,000
Canada
—
China
Hungary
—
Hong Kong
Japan
100
United Kingdom
—
Australia
100
Germany
100
Syria
New Zealand
—
—
Chile
100
Netherlands
2,000
Argentina
Italy
100
—
Cuba
France
1,000
—
Greece
Mexic o
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

617

800,000

617

Wheat flour, semolina,
crushed or cracked
wheat, and similar
wheat products
Established :
Imports
Quota
: May 29, 1947
to April 3. 1948
(Pounds)
(Pounds)
1,388,155
5,600

—

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

—

—

—

—

—

—

—

—

—

—

4,000,000

1,395<515

-

—
—

—
—
*-*

—
—
—
—

%
•—
—
—•

— oOo—

—

1,760
—
—
—
—

, .—
—
—
—
—

—
—

—
—
—
—

—
—
—

FOR IMMEDIATE RELEASE
April »,19l*8

(o f -3

The Bureau of Customs announced today preliminary figure's showing
the imports for consumption of commodities on which quotas were prescribed
b y the Philippine Trade Act of 19U6, from January 1, 19U8, to April 3,
I 9I48, inclusive, as follows?

Products of
?
Philippine Islands?

Buttons

Established Quota
Quantity

850,000

? Unit of ?
? Quantity ?

Gross

Cigars

200,000,000

Number

Coconut Oil

1^8,000,000

Pound

Cordage

6,000,000

n

Rice

1,01*0,000

ft

l,90i*,000,000

it

Sugars, refined )
unrefined)
Tobacco

Imports as of
April 3, 19U8

60,561
3 10 ,9 7 5
25,176,780
199,521*
—

W , 296,Oil;
6 ,500,000

tt

183,335

TREASURY DEPARTMENT
Washington

FOR IMMEDIATE RELEASE
Thursday, April 15, 1948

Press Service
No. S-693

The Bureau of Customs announced today preliminary figures showing
the imports for consumption of commodities on which quotas were
prescribed by the Philippine Trade Act of 1946, from January 1, 1948,
to April 3, 1948, inclusive, as follows:

Products of
s
Philippine Islands:

Buttons

Established Quota
Quantity

850,000

:
Unit of *
: Quantity :

Gross

Cigars

200,000,000

Number

Coconut Oil

448,000,000

Pound

Cordage

6,000,000

n

Rice

1,040,000

n

Sugars, refined )
unrefined)
Tob acco

1,904,000,000

Imports as ©f
April 3, 1948

60,561
310,975
25,176,780
199,524
—

tt

102,296,014
6,500,000

tt

183,335

/»

'**

■~5 -

POE IMMSDIATE RELEASE

& T ty

April lU. 19^8
She Bureau of Customs announced today preliminary figures shoving
the imports for consumption of commodities within quota limitations
provided for under the General Agreement on tariffs and Srade9 from tho
beginning of tho quota periods to April 3 , 19^8, inclusive, as follows:

Commodity

t
:
:

I Unit ?Imports as of
:
of
sipril 3 ,
Period and Quantity t Quantity : 19^g

Whole milk, fresh
or sour

Calendar year

3 ,000,000

Callon

2,190

Cream, fresh or sour

Calendar year

1 ,500,000

Gallon

HlO

Butter

Jan,
Mar.

30,000,000

Pound

(1 )
2^,930,188

Pound

1 through
3 1 , 19kS

Fish, fresh or frosea,
filleted, etc», cod,
haddock, hake, pollock,1
cask, and rosofish
Calendar year
White or Irish
potatoes:
Certified seed
Other

months from
s«pt. 1 5 , 19**7

12

150 ,000,000

Pound
60,000,000 Pound

37,800

533.560 (2)

132 ,659,827

51,221,1*09

(1) She proviso to Item 717 (b) limits the
imports for consumption at tho quota
rate to 12 ,^65 ,09^ pounds during tho
first 6 months of the calendar year»
(2 ) For the period ipril 1 to 3 inclusive»
Due to a provision of the President's proclamation No* 2769 of
January 30* 19 *$* in which the entry of a specified quantity of Cuban
filler tobacco, unstemmed or stemmed (other than cigarette loaf tobacco)
and scrap tobacco affects the rate of duty on such tobacco from countries
other than Cuba, a record Is maintained of imports from Cuba» 6,012,933
pounds of such Cuban tobacco were imported for consumption during the
period January 1 to April 3, 19^8, inclusive»

TREASURY DFPkRlMMT
Washington

PCR B/IMLDIATL R i L M S E
Thursday, April 1$, 1948

Prass Service
No, S-694

-

The Bureau of Customs announced today preliminary figures showing
the imports for consumption of commodities within quota limitations
provided for under the General Agreement on Tariffs and Trade, from the
beginning of the quota periods to April 3, 1948, inclusive, as follows:

Commodity

;

Period and Quantity

:
:
:

Unit
:Imports as of
of
;April 3,
Quantity : 1943

Whole milk, fresh
or sour

Calendar year

3,000,000 Gallon

2,190

Cream, fresh or sour

Calendar year

1,500,000 Gallon

410

Butter

Jan, 1 through
Mar. 31, 1948

Fish, fresh or frozen,
filleted, etc*, cod,
haddock, hake, pollock,
cusk, and rosefish
Calendar year
White or Irish
potatoes;
Certified seed
Other

12 months from
Sept. 15, 1947

30,000,000 Pound

37,800

(l)
24,930,188 Pound

333,560 (2)

150,000,000 Pound
60,000,000 Pound

132,659,827
51,821,409

(1)

The proviso to Item 717 (b) limits the
imports for consumption at the quota
rate to 12,465,094 pounds during the
first 6 months of the calendar year.

(2)

For the period April 1 to 3 inclusive.

Due to a provision of the President's proclamation No. 2769 of
January 30, 1948, in which the entry of a specified quantity of Cuban
filler tobacco, unstemmed or stemmed (other than cigarette leaf tobacco)
and scrap tobacco affects the rate of duty on such tobacco from countries
other than Cuba, a record is maintained of imports from Cuba. 6,012,933
pounds of such Cuban tobacco were imported for consumption during the
period January 1 to April 3, 1948, inclusiye.

Apra 6, 19k&

fo mu BM&m t
Îfee following maitet transactions «are mads during the
month of March, 15&0, to direct end guaranteed securities of
the Cinrersaaent for TTessuxy inventaient and other accounts}
Saúles «•*•*•*•*#«*••***««•••••

Purchases «••••*•««*••••••••«••
Set Purchases«* 1106,?6b, 600

(Sgd* ) Ex 0* Barnes;

Chief, Division of Investments

TREASURY DEPARTMENT
Washington

K)R IMMEDIATE RELEASE
Thursday, April 15, 1948

PPess Service
No. S-*695

During the month of March, 1948, market transactions in direct
and guaranteed securities of the Government for Treasury investment
and other accounts resulted in net purchases of $106,764,000,
Secretary Snyder announced today.

oOo

- 3 of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections 1*2 and

11? (a) (1) of the Internal Revenue Code* as amended by Section 11$ of the Reve­
nue Act of 191*1, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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, as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

- 2 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 Ranks and Branches, following which public announcement will be made by
the Secretary of the Treasury 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 v/ithout stated price from ary 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

April 22, 1?U8

, in cash or other immediately avail-

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders%ill receive equal treatment.

22. I?k8

»

Cash adjustments/will be

made for differences between the par value of maturing bills accepted in exchange
and the issue price of the hew bills.
The income derived from Treasury bills, whether interest or gain from the sale
or other disposition of the bills, shall not have any exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment* as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, Y\rhether Federal or State, but shall be exempt from all taxation now or
hereafter imposed on the principal or interest thereof by any State, or ary of the
possessions of the United States, or by ary local taxing authority.

For purposes

Exhibit -1
Afe»
TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Friday, April 16, 19U8*

The Secretary of the Treasury, by this public notice, invites tenders for
$ 1,000,000,000 , or thereabouts, of
91 -day Treasury bills, for cash and
—1
¿tit
in exchange for Treasury bills maturing April 22, 19k8
, to be issued on
a discount basis under competitive and non-competitive bidding as hereinafter
provided.

- —
interest.

The bills of this series will be dated

■-

Aoril 22. 19k3

, and

- -

They will be issued in bearer form only, and in denominations of

$1,000, $£,000, $10,000, $100,000, $£00,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
closing hour, two o 1clock p.m., Eastern Standard time, Monday, April 19, 19U8
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•
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

TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Friday, April 16, 1948«

'
'

Press Service
No. S-696

The Secretary of the Treasury, by this public notice, invites
tenders for $1,000,000,000, or thereabouts, of 91-day Treasury bills,
for cash and in exchange, for Treasury bills maturing April 22, 1948, to
be issued on a discount basis under competitive and non-competitive
bidding as hereinafter provided. The bills of this series vd.ll be dated
April 22, 194$* and will mature July 22, 194$* 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, two o ’clock p,m,, Eastern Standard Time, Monday,
April 19, 1948. Tenders will not be recéived 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.
Tenders will be received without deposit from incorporated banks
and trust companies and from responsible and recognized dealers in invest­
ment, 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 Secretary of the Treasury 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 competitive bids. Settlement for accepted
tenders in accordance with the bids must be made or completed at the
Federal Reserve Bank on April 22, 1948, in cash or other immediately avail­
able funds or in a like face amount of Treasury bills maturing April 22,
1948, 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, shall not have any
exemption, as such, and loss from thé sale or other disposition of
Treasury bills shall not have any spacial treatment, as such, under the
Internal Revenue Code, or laws amendatory or supplementary thereto.
The

bills shall be subject to estate, inheritance, gift or..other excise taxes,
whether Federal or.State, but shall be exempt from af1 taxation now or
hereafter imposed on the principal or interest thereof by any State,* orany of the possessions of the United States, or by any local taxing
authority# ' For purpose«- of taxation the amount of discount..at which
Treasury-bills- are originally s.çld by the United States shall be considered
to be interest. .Under Sections 42 and 117 (a) (1) Of the.. Internal Revenue
Code, as amended by Section 115 of the Revenue Act of 1^41, the amount of
discount at ;.#iich bills issued hereunder are sold shall not he ..considered
to accrue' until suchbills shall be sold, redeemed nr otherwise disposed
of, and such bills are. excluded from consideration as capital’,assets#
Accordingly, the. owner" Of Treasury bills (other than l.ife' insurance
companies) issued hereunder need include in his :mcome; 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
retum' is made, as ordinary gain; or loss.
. ,:
y ;
Treasury Department Circular N;o# 418, as amended, and this’notice,
prescribe the terms, of the Treasury bill's and govern th® conditions of ;•
their issue. Copies of: the circular may be obtained, from any
Federal Reserve Bank or Branch#

ï

TREASURY DEPARTMENT
Washington

FOR IMMEDIATE RELEASE
Thursday^ April 15, 1 9 ^

Press Service
Ho.

Secretary Snyder announced today that the new Benjamin
Franklin-Liberty Bell half dollars are now being struck at
the Philadelphia and Denver Mints, and will be supplied to
Federal Reserve Banks and branches for distribution to
commercial banks and the public beginning April 30«
The new coin bears the pot?fca&it of Fraklin on the wbbsssssbs.
obverse and a reproduction of the Liberty Bell on the reverse.
All production of half dollars at the U.S. Mints hereafter
will be of this new design. However,
mnàfIm i
the Liberty half dollars now on hand and outstanding will
continue to circulate.
S e c r e t a r y Snyder said the Treasury Department had received
many communications from individuals, banks, societies and
publications throughout the Nation expressing interest

- o -

TREASURY DEPARTMENT
Washington

FOR IMMEDIATE RELEASE
Thursday» April 15, 194-8

Press Service
No* S-697

Secretary Snyder announced today that
Franklin-Liberty Bell half dollars are now
Philadelphia and Denver Mints» and will be
Banks and branches for distribution to the
banks beginnine April 30,

the new Benjamin
being struck at the
supplied to Federal Reserve
public through 'commercial

The new coin 'hears the portrait of FYanklin on the obverse arid a
reproduction of the Liberty Bell on the reverse. All production of
half dollars at the U* S, Mints hereafter will be of this new design,;
However» the Liberty half dollars now on hand and outstanding will
continue to circulate,
Secretàry Snyder said the Treasury Department had received many
communications from individuals» banks» societies and publications
throughout the Nation expressing interest in the new coin;

oOo

insert

In Philadelphia, retail stores devoted 15 minutes to
employee bond rallies this morning, with 7 , 5 0 0 employees
attending.
Governor Youngdahl of Minnesota visited his bank and enrolled
in the Bond-A-Month Plan.
Des Moines retailers offered three all-expense trips to
Washington as top prizes in a bond-selling contest for their
clerks.
Squadrons of planes dropped Security Loan leaflets over
Shreveport, Baton Rouge and New Orleans.

The city of Vallejo, California, oversubscribed its sales
goal in a few hours and proceeded to stage a big celebration.
The Mayor of Cincinnati read a Security Loan proclamation
in Cincinnati^ Fountain Square.
Rural mail carriers of Nebraska began delivering Security
Loan pamphlets to all farm homes in the State.
The Musicians1 Union of Massachusetts bought $ 2 0 0 ,0 0 0
worth of Savings Bonds.
New York City had a Security L0an premiere at the famous
Winter Garden Theater.
The greatest bond rally in the city*s history was booked
for downtown Newark, N.J., with two principal streets renamed
»Bond Street” and »Security Lane” for the duration of the
drive.
Said Secretary Snyder:

wTo say that the Treasury is gratified
puts it mildly.

I should like to express

sincere appreciation to the many citizens
who helped so effectively in launching the
Security Loan Drive.

2

The city of Vallejo, California, oversubscribed its sales
goal in a few hours and proceeded to stage a big celebration.
The Mayor of Cincinnati read a Security Loan proclamation
in Cincinnati*s Fountain Square.
Rural mail carriers of Nebraska began delivering Security
Loan pamphlets to all farm homes in the State.
The Musicians* Union of Massachusetts bought $ 2 0 0 ,0 0 0
worth of Savings Bonds.
New York City had a Security Loan premiere at the famous
Winter Garden Theater.
The greatest bond rally in the city*s history was booked
for downtown Newark, N.J., with two principal streets renamed
"Bond Street” and HSecurity Lane” for the duration of the
drive,
Said Secretary Snyder:
«To

mildly,

the.

Washington

<

^

The Nation has proved itself decidedly security-conscious
by swinging energetically and enthusiastically into the
Security Loan Drive, Secretary Snyder said today .as first
reports on the.opening of the drive reached his desk.
Praising the public spirit reflected in bond-selling
enterprises which were launched this morning all over
promised
the country, the Secretary said the^response to the Security Loan call had a peacetime significance

rivaling that of the

response to the War Loans of 19^2-^5.

The drive is to run

through June
under the direction of the Treasury1 s. U.S. Savings
Bonds Division.
Twenty million school children lined ut> with Withrl mrr
A

today to help, make the drive a success. The school children
are taking U.S. Savings Bonds pamphlets home, to their parents
and urging that they be read carefully. The pamphlets emphasize
the Security Loan theme, "America’s Security is Your Security. 11
In other first-day events governors and mayors issued
vi ^

networks and independent stations everywhere, cabs and buses
and trolleys flew streamers, and

regiments of canvassers

and house-to-house solicitors went diligently to work.
Sandusky, Ohio, announced that its sales goal already was
oversubscribe d.

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS
Friday, April 16., 1943 \

J

.

'

Press Service
No. S-69S

The Nation has'Jf>roved itself decidedly security-conscious by
s?dnging energetically and enthusiastically into the Security Loan
Drive, Secretary Snyder said today as first reports on the opening of the
drive reached his desk.
Praising the public spirit reflected in bond—selling enterprises
which were launched this morning all over the country, the Secretary
said the promised response to the Security Loan call' had a peacetime
significance rivaling that of the response to the War .Loans of 194.2-45*
The drive is to run through June 30, under the direction of the Treasury’s
U. S. Savings.Bonds Division.
Twenty million school children lined up with adults today to help
make the drive a success. The school children are taking U.S. Savings
Bonds pamphlets home to their parents and urging that they be read
carefully. The pamphlets emphasize the Security Loan theme, ’'America's
Security is Your Security.”
In other first-day events governors and mayors issued proclamations,
many rallies were held, broadcasts went out from networks and independent
stations everywhere, cabs and buses and trolleys flew* streamers, and
regiments of canvassers and house-to-house solicitors went, diligently to'
work.
Sandusky, Ohio, announced that its sales goal already was oversub­
scribed.
The city of Vallejo, California, oversubscribed its sales goal in a
few hours and proceeded to stage a big celebration.
, The Mayor of Cincinnati read a Security Loan proclamation in
Cincinnati’s Fountain Square,
Rural mail carriers of Nebraska began delivering Security Loan
pamphlets to all farm homes in the State,
The Musicians’ Union of Massachusetts bought $200,000 worth of
Savings Bonds.
New York City had a Security Loan premiere at the famous Winter
Garden Theater.
In Philadelphia, retail stores devoted 15 minutes to employee bond
rallies this morning, with 7,500 employees attending.
Governor Youngdahl of Minnesota visited his bank and enrolled in
the Bond-A-Month plan.

-

2

-

Des Moines retailers offered three all-expense trips to Washington
as top prizes in a bond-selling contest for their clerks*
Squadrons of planes dropped Security Loan leaflets over Shreveport,
Baton Rouge and New Orleans*
The greatest bond rally in the city’s history was booked for
downtown Newark, N.J., with two principal streets renamed »'Bond Street»
and »Security Lane» for the duration of the drive*
Said Secretary Snyder:
»To say that the Treasury;' is gratified puts it mildly.
I should
like to express sincere appreciation to the many citizens who helped
so effectively in launching the Security Loan Drive.»

0O 0

(j>

I want iaiM^ to express my sincere appreciation to all
advertising media and to the retail and industrial advertisers
of the nation for their support in opening the important
Security Loan bond-selling drive*
Vs This is the kind of team-work between magazines, news­
papers, radio networks and stations and outdooi^p
companies and their public-spirited advertisers that will
put this campaign over with little cost to the
t
\ We „believe that upwards of $12,500,000 in measurable
advertising will be sponsored and contributed during the
drive, and this figure does not include the cost of the
promotional work by the motion picture industry, television,

9

TREASURY DEPARTMENT
Washington

FOR IMMEDIATE RELEASE
Tuesday, April 20, 1 9 W

Press Service
No. S -

Reports to the Treasury Department indicate that a huge
amount of advertising will he contributed to the Security Loan
drive,

Secretary Snyder announced today. SKSK The Secretary said

TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE
Tuesday, April 20à 1948

Press Service
No. S*699

Reports to the Treasury Department indicate that a huge
amount of advertising ■will be contributed to the Security
Loan drive, Secretary Snyder announced today. The Secre­
tary said:
"I Want to express my sincere appreci­
ation to all advertising media and to the retail
and industrial advertisers of the nation for their
support In opening the important Security Loan
bond-selling drive.
"This is the kind of team-work between
magazines, newspapers, radio networks and stations
and outdoor advertising companies and their publicspirited advertisers that will put this campaign
over With little cost to the Government
"We believe that upwards of $12,500,000 in
measurable advertising will be sponsored and con­
tributed during the drive, and this figure does
not include the cost of the promotional work by
the motion picture industry, television, and other
media *"
*
OOo

2

7

"I thank you for your help in the Security
Loan, and I hope that you and your classmates
"will buy Savings Stamps regularly, and encourage
the grown-ups to invest in Savings Bonds to
benefit their country and themselves.n

PROPOSED PRESS RELEASE
For release

PM Newspapers

Susan Beesten, a ten year old Cincinnati school girl wrote
Secretary Snyder the other day asking him whether she was
/working for the Governmentwhen she distributed pamphlets
about the Security Loan Drive.
The Secretary promptly replied to Susan's letter, telling
her that, as one of the twenty million school children who are
volunteer workers, she is helping the Treasury Department to
carry its message of thrift and savings to every American family.
Susan’s letter to the Secretary follows:
"My name is Susan Beesten. I am ten years old.
I am in the fifth grade. I was passing out pam­
phlets about how you get Savings Bonds. The U. S.
Government sent them to school. And while I was
passing them out I told the older children that
I was doing work for the government, and I would
like to know if I was doing work for the government
by telling people to save money.M
Here is Secretary Snyder’s reply:
"I was very glad to have your letter asking if you
were »doing work for the Government* by giving out
Savings Bond folders.
""When you passed out Security Loan folders to your
classmates to take home, you were a volunteer
worker helping the Treasury to carry its message
of thrift and saving to your family and friends.
Twenty million school students, like yourself, are
now helping the Treasury distribute Security Loan
folders.
ffYou see, although a few of us work here in Washington,
our Government is really made up of $11 the people,
as Abraham Lincoln once said. So wheli you and other
school students, or anyone, helps an agency of the
Government in Washington to carry on its activities,
you are indeed volunteers serving your country.

TREASURY DEPARTMENT
Washington
FOR RELEASE, AFTERNOON NEWSPAPERS
Thursday, April 22, 1948.

Press Service
No. S-700

Susan Beesten, a ten year old Cincinnati school girl, wrote
Secretary Snyder the other day asking him whether she was work­
ing for the Government when she distributed pamphlets about the
Security Loan Drive.
The Secretary promptly replied to Susan's letter, telling
her that, as one of the twenty million school children who are
volunteer workers, she is helping the Treasury Department to
carry its message of thrift and savings to every American family.
Susan's letter to the Secretary follows:
"My name is Susan Beesten. I am ten years old. I
am in the fifth grade. I was passing out pamphlets,
about how you get Savings Bonds. The U. S. Government
sent them to school. And while X was passing them out
I told the older children that 1 was doing work for the
government, and I would like to know if I was doing ”
work for the government by telling people to save money."
Here is Secretary Snyder's reply:
"I was very glad to have your letter asking if you
were doing work for the Government by giving out Savings
Bond folders.
’When you passed out Security Loan folders to your
classmates to take home, you were a volunteer worker
helping the Treasury to carry its message of thrift and
saving to your family and friends. Twenty million
school students, like yourself, are now helping the
Treasury distribute Security Loan folders.
b"You see, although a few of us work here in
Washington, our Government is really made up of all the
people, as Abraham Lincoln once said. So when j o v T and
other school students, or anyone, helps an agency of
the Government in Washington to carry on its activities,
you are indeed volunteers serving your country.
"I thank you for your help in the Security Loan,
and I hope that you and your classmates will buy Savings
stamps regularly, and encourage the grown-ups to invest
m Savings Bonds to benefit their country and them­
selves ."
-q O q -

They do indicate, however, that If prices do not increase above
current levels and if our credit structure does not become
weakened, prices are not likely to suffer the precipitous drop
that occurred between lay, 1920, and «Tune, X923U
Another important factor that was only slightly present in
192»,

but m m has assumed large proportions, is t o substantial

control of industrial «ages by organised industrial labor* We
say reasonably expect a strong resistance to any serious decline
in sage levels*
1

do not mean to say that s© cannot expect price adjustments

in t o years ahead and t o likelihood of price reductions in many
lines* As production and demand come into better balance, price
adjustments are inevitable* At t o m m n t , the task is to hold
the Una on the inflation front and to prevent further rises that
might eventually result in too costly readjustsenis*
I

believe it is possible to attain that objective, provided

there is proper restraint on t o part of business, of finance, of
labor, and of Government* fo pursue any other course may endanger
not only our private enterprise system but democratic government
in this country as «ell*

gi^ss will be conducted in the interest

of the stability of

our economy*
Fiseal policies of the Federal Government, budgetary manage**

mn% and changes in our tax structure are^iaportant elemnts in
our national economy.

yw*y

They constitute a large field of discussion,

whichAtiise does not peraait*
A factor of tremendous irport&nee in- our economy is the total
of liquid assets held by individuals aggregating apprcodjrately

200 billion dollars at the present tine. Of this aacrant, nearly
150 billion dollars has been accumulated daring the past eight
years*

Of this total amount, 67 billion dollars represents

individual holdings of United States Governisaent securities#
When we suasaarisse all of the facts and factors of our present
economic situation as cohered with

1920, we discover:

(X) Fhat there are basic elements of financial and economic
strength^today that proportionately can sustain a higher price
level and a higher production than could be sustained in

1920*

In addition, there are fewer weaknesses in our price structure and
in the credit structure than in the

forms period# These facts

do not necessarily p#owe that both priced and production say not decline*

m

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both period®*

Different indices of building cost®, for exar^ple,

vary widely among themselvesj and perhaps all f a i l to reflect
the actual results realised on the site*

«evertie less, it if

interesting to note that the Indices of building and construction
costs compiled by the Engjraeerin g Bewg~Becord. by the American
Appraisal Company, and by the Associated General Contractors, all
show a s m H e r increase since 1939 than occurred between
m

1914 and

7
According to the best estimates which we have been able to

obtain, total urban mortgage debt increased about

50 percent in

the eight year® ended with 194?, a® compared with an increase of
i&j | ^

■
'

✓

about 40 percent in the four years ended with

1920.

<^3
On© o f t&see ccnsa derate prince- npBirij nirrmr afiitoi>./NtIn1 long
a m o f Gov®mif»nt.

I t has been reaching out into the field of

guaranteeing mortgages, with the possibility that the Treasury may

^ be rapped on the knuckles* But such an outcome, however unfortunate
would, in any ©vent, ameliorate the situation from the standpoint

of individual mortgagees and, to a lesser extent, individual
mortgagors.

1 1 1

13
evaluation of current earnings*
It may reasonably be concluded, then, that the stock
market was not a focal point of weakness in the economy at the

of the 1920~21 recession, and that it is not now« In both

time

cases, stock prices have failed to reflect the full current
level of corporate profits/. This is quite the reverse of the
situation in 1929, when the market was reflecting an expected
sharp rise in profits* so that even a leveling off of profits
wceild have likely precipitated a stock market crash*
I come now to the field of urban real estate*
I have had the distinct Impression that this is one field
more vulnerable at the present time than it was in 1920*

We

knew, in the light of the outcome, that the urban real estate
market was one of the meet vulnerable elements in the 1920 situation.
It is extremely disconcerting to read

such statements concerning

the present situation as that in the March Federal Reserve Bulletin
that,

n* * • The increase In mortgage indebtedness
on 1** to 4~faaily residences, for example, has been
estimated at 5.5 billion dollars for 194?, almost
a billion more than the 1946 growth and 5 billion
more than that for 1945* Mortgage indebtedness on
this type of housing has increased during the past
two years by an amount greater than new construction
expenditures on such housing. , . .* ^
It is difficult to compare the urban real estate situation
, y.r.
now and in 1920 because of the lack of reliable data covering

Ill
» It «

ositos textil© industry ha# had »ore than Its share of bfHVi «»y*
bust— profits Si* cotton good* luusifacturing fail by about 87 p « ^
i ^ 1 »*L f t ■
„
J
J
botwNm 1919 and 1921— and it «ay well bo * propor timo b o o
for cotton manufacturers to consider pricing policio# moro in
l i m «iti* the permanent

4o you
^ato

preservation of their aarket#.

1mm, tbo stock market rioni the current earning

in the cotton tortilo industry with « good ¿ M l Of

skepticism.

The stock# of sono of the boot oenpenies in tbo

^#^***tf

8®* filing at unify too or throe tino#-

Such skepticism runs through the entire aarketf Alteragli

ii^«

less extreme degree«

The price# of common stack», a#

3 /<T
by Standard and Fo o t «# coepröhansive index, are up only J€T
forcent

trm their 1939 average, despite the groat increase %m

corporate profit# and in the replacement m i n » of the underlying
The 50 industrial stocks included in Standard and Poor*#
daily Index are selling, m

the average, at only about S"tinea

their 194? earning#«
The increase in stock price# in the World War I period
na# atea le##« Stock price# then reached their high for the
....
.
/
entire ear period in 1916 before the United States entered the
aar*

The average for 1919— the highest postear year— «a# cefy

a h m t 4 percent above that for i m i i cad the average for 192Ö
«a# about ? pensent b e W l 9 1 4 .

Wineteea Madred and twenty stock

prie»»#, 113» those of the present tine, represented a conservative

7

v

11 *
j
was 8*2 cents for every dollar of product*

The aj&azlng sinilarity In the proportion of the national
product represented by corporate profits in these two good
J

'

/ I ’'

years— 28 years apart— is a fact to be conjured with* It is
equally sobering to those who say that corporate profits haws
run off the track in their excessiveness, and to those who say
that the “good old days1* have gone forever*

ccsspl

■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■

1

I,

Its are one

of the most flexible elements in our economy, and must be expected
to be high in good years and low in poor ones, both in absolute
amount and as a proportion of the total product*
Corporate profits arc, of course, much higher in some
lines than in others* £. tabulation published by The Hational
>/’

}'

s/r

*

7*'

/.

V*

City Bank of New fork, in its April review of Economic Conditions,
shows that 3 ,102 ^leading corporations in all lines of activity

separate cc®pilations, the highest return on net worth was in
the cotton goods industry, where this return was 36*1

✓

I have said that corporate profits are one of the most
flexible elements in the economy, and profits in the cotton
textile industry are more flexible than mostj but there are seme
who think this is carrying flexibility a little too far* The

1°
10

deposits in the liabilities of the Federal Reserve Banks-— to
25 percent— irrespective of these proportione— in June 1945,
when the war was still going on and it seemed that the c&d ratio
might be violated*
Kext to the change in the international situation* this
changed attitude with respect to the role of Govexment 1 st oar
economy is probably the greatest change between 1920 and now.
The country now expects the Cknremment to sit on the high side
of the boat; and Government now undertakes to keep the boat
steady— with varying success*
The next point on our tour is corporate profits*
the Treasury Department has estimated* in its testimony
^
:• ‘
.S'
before Congressional committees, that in the calendar year 1947
pa
y
”' , Vy
;’y
y
corporate profits after taxes amounted to about 19 billion dollars.
y .y
This is an increase over 1939 of a little over 200 percent*
-%. '1 '

In 1919— the best profit year in the period immediately
it m il ' *

>/

;#

following World War 1— «corporate ’
profits after taxes amounted to

about © billion dollars* an Increase as compared with 1914 of only
about é0 percent*
The economy has so grown during the intervening period that
a comparison of dollar profits now and then i® almost meaningless*
But there is one pair of figures that sticks in ay mind. In 1919/
^
/
corporate profits after taxes amounted to 8 *1 cents for every dollar
of the gross national product\ la 1947* the corresponding proportion

'JO

I

m

In

1920, United State# Securities accounted fee* only about

1 1 percent of the total loans and investments of all member

hanks* while today they account for marly 60 percent. This
means that the money mipply~**&nd the whole eeonoay— is much
less vulnerable today to the type of loan contraction which swept
the country in 1920 and 1921 than at that time.
The discussion of money supply brings a# back again to one
of our central themes in the comparison between now and 1920—
the changed role of Government*
,
."/• JiL ife/4
$,
■ " »
ifc, 1
S
In ^une, 1920, the Federal Reserve gettf ratio was about 41
percent, and the Federal Reserve authorities took it for granted
that this required a drastic deflation in member bank borrowings—
'*.v'
y
which then amounted to between 2»l/2 and 3 billion dollars.
r^>
475
Today the Federal Reserve^ratio is about .So percent* and member

much more important, m r whole attitude toward the significance
of tèm figures ofw i wt v ^ w fcis1
« has changed.
It is no longer considered proper or necessary to liquidate
the economy because of a low or declining Federal Reserve ratio*
If the economy were otherwise sound, a change in the reserve
requirements of the Federal Reserve Banks by statute would be con»
sidered a more appropriate remedy. These requirements actually
;

SM
)

'•Jr

were reduced from a figure of between 35 and 40 percent— depending
Upon the relative amounts of currency and member bank reserve

7

d

Businessmen and consumers alike want to play their cards closer

\K/j>
to the cheat than they did a generation ago«

They like to have

mom » m a y in the bank and more money in the till before they go
ahead now than w * did then*

Whether or not thia increase in the

conservatism of the American people has been great enough to
absorb the entire increase in the money supply, only time will
tell.

But it can be said with reasonable certainty that today* s

money supply goes much farther toward supporting and sustaining
today’s prices than the 1920 money supply went toward supporting
1920 prices.
of the money supply

Sc much for the difference in the amount
now and in 1920.

It is also very different in kind.

In both wars the Increase in money supply was brought
about partly as a result of financing the Government deficit
and partly as a result of financing an Industrial expansion.
But there is a big difference in the proportions.

The expansion

of the war industries in World War I was largely financed by
the issuance of their own securities and by their own borrowing;
whereas in World War XX, It was financed principally by the
Government.

■

As a consequence, a much larger proportion of the

v

7'.,

'°}S

money supply in 1920 was backed by the private loans and invest*
manic of banks than is the case today.

I

■ /

.

J

In 1920, private debt constituted eighty percent of all

m

v ”'

debt, whereas/ today private debt is only forty percent of all debt«

| 1 1

7
¡ Ü «bont 1 U bllliaa dallare nid total liaMlitiee of «bout
y
/
Í billle» dollars* ïher© ara no eorresponding figures availeble
for the 1920 period, but «s do knos that fars mortgag© âebt has
beau eut In half duriag the last 25 years*
Beturaing to the general cubjeet of eostæodîty priées» o m
of the priœary causes of the ris# ln prie«» «rkteh eharaeteriseâ
boih war période sas the great increase in the noney sapply*
fhe laoney supply» defined as curreney entolde of hanks
plus adjpsted âmmw g deposite» inoreased ahont m&pereenfc
during the period fro© 1914. to 1920, and about 230^percent
y
in the period fro© 1959 to 194B* Basad on the lacrease in

memey suppîy alone, iherefore» on© would hâve expeeted a
greater relative rise in coœraodity prises in the second s r
pericsd than in tiw» first*

But» as 1 hâve already poisted ont»

the reverse is aetually the ease~~the inorease in both whole**
sale and oonsuaer priées froa 1939 te the présent tise heing
les® than that freo 1914 t© June» 1920*
The différence in the noney supply situation nos and in
1920 is worth locking Info further.
în the first place» ve'hsve more sioney relative to oor
volume of business nos than va did than*

în 1920» we had about

J
2? cents in moaey supply for eaeh dollar of the gros® preduetf

n m t m hâve about 46 cents of aoney for each dollar of product.

, '

.. II "

1

'

III

tb&t the downturn in farm prices was om of the first
./
the 1920 break* We had our meaozy Jogged on this point last
:^

.

/

-v'

February• But* here again* the role of Government enters in the
fora of support prices for agricultural products* nineteen hundred
and twenty can hardly be axpeeied to repeat itself here*
In yet another respect, .far removed fro« Government intervene
tion, the agricultural situation is now vastly different than it
was in 1920, While the prices of farm real estate hare advanced
even «ore rapidly daring the past few years than daring and after
World War I~-byj9iT percent from 1939 to 2947* as compared with 7$
percent from 1912 to 1920— this rise is very different in two
particulars# First* the World War X rise- came [on top of a pro­
tracted rise in the previous decade* The World War IX rise* on the
other hand* has been largely a recovery from the depressed market
of the 1930*s* Second* and perhaps more isgjortant, the World War
I rime was accompanied by an increase ©f about 160 percent in farm
mortgage debt* while the World War II rise has been accompanied by
a decrease of about 30 percent in such debt*
Based on the same principles which a banker would use in read*»
ing the balance sheet of an industrial concern, agriculture is in
a sound position today* The consolidated balance sheet of »it
agricultural enterprises in the 1 Sited States as of J&no&zy 1 , 1947*
as estiaated by the Department of Agriculture* shows total assets

|jii
- 5 ~

_
^

_ :___j

tli© high 194? figure is, of course, the unsettled international

situation; hut a great many large Geverniwm-b ecspenditures are hear©
to stay, irrespective of events abroad*
this expansion in the role of Government i s an iaçortant
factor in oar eeonoay today that existed only to a minor degree
•/
. :
in 1920* A farther expansion could sake our system less productive,
more rigid, and less adaptable to nee ©ante*

But, looking ahead

over the next few years, it is apparent that the greater role of
Government in the ©conoay today— and the stable, and even anticyclical, character of Government operations— is evidence cm the
side of expecting a more stable level of business activity in the
years ahead than was the case in the years which followed 1920*
This greater role of Government weighs heavily cm our interpre­
tation of many other economic series*

fh© Bureau o f Labor Statistics*

index of consumer prices has advanced about 68 percent from its 1939^

y

,

-•

average, as compared with an advance of about 108 percent from the
1914 average to June, 1920*

The Bureau*« index of wholesale prices

has advanced about lOS percent from its 1939 average, as c o ^ a r e d
with an advance of about 145 percent from 1914 to June, 1920*
Prices of industrial products have advanced much less than in World

I

!i>o^

' -V'

\ W a r Jÿ

^ i c e s much more —

JUST percent for the present

period as cospared with l ^ p e r c e n t in the former*

We well reseaber

SI §|
4-

they are based solely upon the insatiable desire of the Soviet
Government far world domination.
The drive behind this desire Is the great unknown in the
domestic business situation. If this drive for world domination
is so strong as to put and to keep the Suited States on a quasi*
war basis, all comparisons with the post-World War I sequence
of eeonastic events are pointless.
It is under the shadow of this great doubt that we proceed
with a comparison of the economic situatiae now and in 1920 , and
an analysis of the present-day significance of the post«$orld War
1 pattern.

that I find it worth-while to proceed with this analysis
at all, and that— I hope— you find it worth-while to follow me
in It, are tributes to our faith that ordinary everyday eomaou
sense will triumph, even over the intricate dogmas of communism;
and that the men in the seats of authority in kussla will ultimately
find it wore wrth-while to build up their own system than to try
to tear down ours.
And so we proceed with our economic >£our. Back in our own
heme waters, the first scone which it seoas worth-while to survey
is the role of Government in our ©comcoy. In the gflewdar year
■/
1920, the total expenditures of the Federal Government were equal
to only 6 percent of the national product. For the calendar year
1947, the corresponding percentage was IS. Part of the explanation

political situation, pointing out some respects is which the
current situation resembles that of 1919*1920 and in what
respects it differs fro® it.

I have selected the period after

World War I that most nearly compares with the present.
Let us start with the international political situation.
1 do this, not because I have any new contribution to sake in
this field) but because, in ay opinion, events in the inter*
national field will, more than any others, determine what happens
to domestic business.
The communists have for years preached the economic inter*
pretation of history.

They have told us for generations that

economic events determine political events.
say.

That is what they

But, in the course of two or three years of concentrated

action, they have done an extremely effective j©0 of teaching
us just the reverse.

h* far as today’s march of events is concerned, world
politics determine world economics, and not the reverse.
There is no economic reason why the world should not be at
peace.

There is no economic reason why we

should have

to spend

fifteen billion, or ten billion, or even a billion dollars a
year for national defense.

There Is no econcsmip reason why Russia

should spend a far larger share of her national product than we
do for this same purpose.

The reasons are entirely political)

wartime controls were dropped too quickly in the light of price
rises that promptly developed«
there were and there continued to be two schools of thought«
One believed that the post war pattern of oar economy after World
War n

would follow the pattern after World War 1«

They generally

predicted that the country would suffer a serious recession*
commencing in the spring of 1947«

Even when this did not happen*

they became more certain after the break in the commodity markets
in February, 1943«
Another school of thought believed that World War II had been
so different fro® any of its predecessors that it was likely to
be foil owed by an entirely different sequence of ec anemic events
than had followed World War I*

They point to such disturbing world

events as the recent eommurdst coup in Czechoslovakia and the
militant drive of Communism throughout the world«
both among economists and praeti

Thought today*

businessmen* is still oscillat­

ing between these two points of view«

I believe that—

as is so

often the case in the real world— the truth lies somewhere between
the two extremes«

Just where this mean may be is a question of

utmost significance for practical businessmen«
I do not pretend that I have the answer to this question which
is so much in every businessman* s mind«

But, in order go give you

the benefits of ay own thoughts on the subject, I would like to take
you on a short tour of the economic situation and of the international

(Address by A. L. M. figgine, tradir Seeretary
of thè Treaemyy m% thè mmmi meeting of thè
Aaeriean Cotto» Sanafactorera Associatien» Me*

O rleans, L ou isian a, A p r ii 23rd, X94&»)
FOE RELBASE UPOH DELIVEEX

presa Service

tare bave always had a severe impact
Fra» thè

0«

thè econony of thè

far io World ter IX and

all that caste betwean» dvaring m i following every one; there was
a dem&nd far geode in txetss of production aitò a resultant rise

Im prie« lavala and a resultant adjustnent la thè econosy,
Siiwm oar entry lata World War H

and particularly since

Bay in August, 1945# hoelaessaeii» fi » m e l a i non» and aecoonists
bava tmdertaken to analyse ani to forecaat thè pròbable adjustaent»
that night he expeeted»
The batting average of these opinione haa net heen good.
Following F-J Bay» it was expeeted that onr ecoiiossy would take
a deep piange during thè readjustsent fron war production to pcaeetino production.

In arder to facilitata thè tranciti«»# easy

wartise Controls «»re qntekly dropped, t&xes «ero redueed and
preparations made far cariane unenployiaent,

gomever» thè adjast*»

ments were Bade coro quickly and acro easily than thè noci optinietto
believed poseible and tmessplcyment failed te develop,

Bona of thè

TREASURY DEPARTMENT

Washington

(The following address, by A.L.M. Wiggins, Under
Secfatary of the Treasury, at the annual meeting .
of,the American Cotton Manufacturers. Association,
Roosevelt Hotel;, New' Orleans, Louisiana,, is
scheduled for delivery at 11:00 A,M„, C.S.T.,
Friday, April '¿3, 194 o, and is for release’ at that
time..)
'
SOME PRESENT.ECONOMIC CONSIDERATIONS
Wars have always had a severe impact on the 'economy of the
participants. From the Revolutionary War to World War II and
all that cane between, during and following every one, there
was a demand for goods in excess of production with a resultant
rise in price levels and a resultant adjustment in the economy.
Since our.entry into World War II and particularly since
V-J Day\in August, 1 9 4 5 , businessmen, financial men, and econ­
omists have undertaken.to analyze and to forecast the probable
adjustments that might bo expected.
The batting average' of these opinions has not been good..
Following V-J Day, it was expected that our economy would
take a deep plunge during, the readjustment from war production
to peacetime production.1 In order to facilitate the transition,
many wartime controls wore quickly dropped, taxes were reduced
and preparations made for serious unemployment. However, the
adjustments were made more quickly and more' easily than the most
optimistic believed possible and unemployment failed to'develop.
Some of the wartime controls were dropped too quickly in the
light of price rises that promptly developed.
There were and there continued to be two schools of thought.
One believed, that the. post war pattern of our economy after
World War II would follow the pattern•after World War I. They
generally predicted that the country would suffer a serio-us reces
sion, commencing in the spring of 1947. Even when this did not
happen, they became more certain after the break In the commodity
markets in FeEruany, 1948.
Another school of. thought believed’ that World War II had
been so different from any- of its predecessors that it was likely
to be -followed by an entirely different sequence of economic events than had followed World War I. They point to such dis­
turbing world events as the recent communist coup in
Czechoslovakia and the; militant drive of Communism throughout the
world, Thought today, both among'economists and practical
S-701

businessmen,, is still-oscillating between those two points of
view.- J believe that--as is so often' the case in the real
world--the truth lie s .somewhere- between the. two extremes, Just
whore this mean may be. is a question of utmost significance for
practical businessmen.
I do not pretend that I have the answer to this question
which is so much in every businessman’ s' mind. But, in order to
give you the benefits of my own thoughts on the subject, I would
like to take you on'a short tour of the economic situation and
of the international political situation, pointing out some
respects In which the current situation resembles that"of I 9 1 9 1920 and in what respects it differs from i t . I have selected
the period after World.War I that most nearly compares with the
present.
Let us start with the international political situation.
I do this, not.because 1 have any new contribution to make in
this field; but because, in my opinion, events in the interna­
tional field w ill, more than any others, determinewhat happens
to domestic business.
-The communists have for years preached the economic inter­
pretation of history. They have told.us for generations that
economic events determine political events, • That is what they
say. But, in the course of two or three years of concentrated
action, they have done an extremely effective job of teaching
us just,#the reverse.
As far as today's march of events is concerned, world
politics determine world economics, end not the reverse.
There is no economic reason why the world should hot be at
peace. There is no economic reason why we ‘-should have to spend
fifteen billion, or ten billion, or even a billion dollars a
year^ for national defense. There is no economic reason why
Russia should spend a far larger share of her national product
than We do for this same purpose. The. reasons are entirely
political; they are based solely upon the insatiable' desire of
the Soviet Government for world domination.
The drive behind this desire is the great unknown in the
domestic business situation. Jf- this drive-: for world d.omino,tion
is so strong as to put and. to l ?ep the United States on a quasiwar basis/ all comparisons with the post-World War I seauence
of economic events are pointless. '
It is under the shadow of this great doubt that we proceed
with a comparison of the economic situation now and in 1 9 2 0 , and
an analysis of the present-day significance of the post-World
War I pattern.

- 3 That I find-It worth-while" to proceed with this analysis
at all, and that--I hope~-you find it worth-while to follow me
in 'it, are •tributes, to our faith, that ordinary everyday common
sense will .trihmph, even over the intricate dogmas of communism;
and^that the men in .the seats of authority in Russia will
ultimately find it more Worth-while to. build up their own system
than to try to tear down ours.
And so we proceed with our economic tour. Back in our own
home waters, the first scene which it seems worth-while to survey
is the role of ...Government in .our economy. In the calendar year
1920, the total expenditures of.the Federal Government were equal
to only 6 percent of the national product. For the calendar year'
1 9 4 7 , the corresponding percentage was 18.
Part of the exp1 ana*
tion of the high 1947 figure i s , of course, the unsettled inter­
national situation; but a great many large Government expenditures
are here to stay, irrespective ' of events ^abroadf
This expansion in the role of Government Is an important
factor in our economy today that existed only to a minor degree
in 1920. , A further expansion could make our system less .produc­
tive, more rigid, and less adaptable to new wants. But, looking
ahead over the next few years, it is apparent that the1 greater
role-of Government in the economy today--and the stable, and"even
anti-cyclical, character of Government operati ons--is evidence
on the side of expecting a more .stable level of■ business activity
I920 he y<3arS ahead than vai3 tlie case in the years which followed
This, greater role of Government weighs heavily on our inter­
pretation of many other economic series . The "Bureau of LaborStatistics' index- of consumer prices has advanced about 68 percent from its 1939. average,, as compared with an advance of about
10 « percent from the 1914 average to June, 1920. The Bureau's
index of wholesale prices has advanced about 1 0 8 percent from
its 1939 average,, as compared with an advance of about 145 percent
irom 1914 to June, 1920. Prices, of Industrial products have :
advanced much less than in World War I, but farm prices much
more -- 1 8 0 percent for the present period as compared with 1 3 5
percent in the former. We well remember that the downturn In
xarnn prices was one of the first signals of the 1 9 2 0 break.: We
nave our memory jogged on this point last February. But, here
again, the role of Government enters In the form of support- ■
prices for agricultural products. Nineteen hundred and twenty,
can hardly be expected to repeat itself here.
aii°ther respect, far removed from Government interx-ii ioh, the agricultural situation Is now vastly different
n-¡aa ,vas i-n 1 9 2 0 . While ,the prices of farm real estate have
nnri
more tepidly during the past few years than during
¥ar
-hy .102 percent from-1939 to 1948, as
compared with 75 percent from 1 9 1 2 to 1920--this rise is very
nièrent in two particulars. First, the World War I rise came'

4
on top of a protracted rise in the previous decade. The World
War II rise, on the other hand, has been largely a recovery
from the depressed market of the 1930»s . Second, and perhaps
more important, ‘the World War I rise "was accompanied hy an
increase of about 160 percent in farm mortgage debt, while the
World War II rise has been accompanied by a decrease, of. about
30 percent in such debt*
•Based on the same principles which a banker Would use in
reading the balance, sheet; of an industrial concern, agriculture'
is in a sound position today. -The consolidated balance sheet
of all agricultural enterprises in the United States as of
January 1, 1 9 4 7 , as estimated by the Department of Agriculture
shows;total assets of about 111 billion dollars and total
liabilities of about^ 8 billion dollars. There*are no correspond
ing figures available for the 1920 period, but we do know that
farm mortgage debt has been cut in half during the last 2 5 years
Returning to the general subject of commodity prices, one
of the primary causes of the rise in prices which characterized
both war periods was the great Increase in the money supply.
The money supply,, defined as currency outside of banks
plus adjusted demand deposits, increased about 104 percent
during the period from 1914 to 1 9 2 0 , and about 2 3 0 percent in
the period from 1939 to 1948. Based on the increase in money
supply alone, therefore, one would have expected a greater
relative rise in commodity prices in the second war period than
in the f ir s t . But, as I have.already pointed out, the reverse
is actually the case--the Increase In both wholesale and consumer prices from 1939 to the present time being less than that
from 1914 to June, 1 9 2 0 .
1920

The dtff’euence in .-the money supply situation now and in
is worth looking into further.

first place, -we have more money relative to our
volume .of ^business now than we did then. In 1 9 2 0 , we had about
2 , cents in money supply for each dollar of the gross product»
now, we have about 46 cents of money for each dollar of product
?^si ? e s s ? e n , a? 5 c o n s rs alike want to play their cards closer
to the chest than they did a generation ago. We like to have
more money m the bank and more money in the t i l l before we go
ahead now than we did then. Whether or not this increase in th
conservatism .of the American people has been great enough' to
II.

Increase- in the money supply/ only time will
But it can be said.with reasonable certainty that today’:
S° ^ rnuch further toward supporting and sustaining

iapn
r n^cPf
*-1/ u 7 p
G siCeS
«

than tixo

1920

Elone^ supply went toward supporting

5

So much for the difference in the amount of the money supply
now and in 1920. It is also very different in kind.
In both wars the increase in money supply was brought about
as a result of financing the Government deficit and
partly as a result of financing an industrial expansion.. But
there is a big difference' in the proportions. The expansion of
the war industries in World War I was largely financed by the
issuance of their own securities and by their own borrowing;
whereas in World War II/ it was financed principally by the
Government. As a consequence,- a much larger proportion of the money supply in 1 9 2 0 was backed by the private loans and invest­
ments of banks than is the case today*
partly

In 1920, private debt constituted eighty percent of all
debt, whereas today private debt is only forty percent of all
debt.
/
:
In 1920, United States securities accounted for only about .
percent of the total loans and investments' of all member
banks; while today they account for nearly 60 percent. This
means that the money supply--and the whole economy--is much
less vulnerable today to the type of loan contraction which
swept the country in 1 9 2 0 and 1 9 2 1 than at that time.
11

The discussion of money supply brings us back again to one
of our central themes in^the comparison between now and I 9 2 O-the changed role of Government.
In June, 1920, the Federal Reserve ratio was.about 4l per­
cent, and the Federal Reserve authorities, took it for granted
that this required a drastic deflection in member bank borrowings-which then amounted to between 2-1/2 and 3 billion dollars
Today the Federal Reserve gold ratio is about 5 1 percent, ¿nd
member bank borrowings are only sixty-eight million dollars, But, much more important, our whole attitude toward the signi­
ficance of figures of this type has changed.
It is np longer considered proper or necessary to liquidate
the economy because of a low or declining Federal Reserve ratio.
If the economy.were otherwise sound, a change in the reserve
requirements of the Federal Reserve Banks by 'statute would be
considered a more appropriate remedy. These requirements actually
were reduced from a figure of between 35 and 40" percent—depending upon the relative amounts of currency and member bank reserve
deposits in-the liabilities of the Federal Reserve Banks—to
J?
irrespective' of these proportions —in June, 1 9 4 5 ,
var vas s t ill going on and it seemed that the old ratio
might be violated.
•'

Next to the change in the international .situation, this
changed attitude with respect to the role of government in our
economy is probably the greatest change between 1 9 2 0 and now.
The country how expects the Government to sit on the high side
of the -boat* and-Government now undertakes to keep the boat '
steady-- with varying success.
The next point on our tour is corporate profits.
The Treasury Department has estimated, in-its testimony
before Congressional committees, that in the., calendar year:. 194 7
corporate profits after taxes amounted to about 19 billion
dollars. This is an increase over'1939 of a little over 200
percent.
In 1919-~the best profit .year in the;period immediately /
following World War I--corpcrate profits after taxes amounted to
about 6 billion dollars, an increase as compared with 1914 of
only about 60 percent.
The‘ economy has so gnown .during the intervening period that
a comparison of dollar profits now and then is almost meaningless
But there, is' one- pair of figures that sticks in my mind, In
1 9 1 9 * corporate profits after taxes amounted to 8 , 1 cents for
every dollar of the gross national product; in 194-7* the
corresponding proportion was 8 ,2 . cents for every dollar of
product.
The amusing similarity in the proportion of the national
product represented by corporate profits in these two. good
years--28 years apart--is a fact to be conjured with. It is .
equally sobering to those who say that corporate profits have
run off the track in their excessiveness, and to those who say'
that the ’’good old days” have gone forever.
However, in 1921, net corporate profits disappeared,
completely. The fact Is, of course, that'..corporate profits are
one of the most flexible elements in our economy, and must be
expected to be high in good years and low in .poor ones, both- in
absolute amount and as a proportion of the total product, .
• 'Corporate profits are, of course, much higher in some
lines than in-others. A tabulation published by The National
City Bank of New. York, In its April review of Economic Conditions
shovs that 3 * 1 0 2 leading corporations in a ll lines of activity
earned an average return of 1 2 . 2 percent on their net worth"in
19}1 ?. Of the .70 lines of activity for. which the Banlc made
separate compilations,, the highest roturrhon net .worth was in'
the cotton goods industry, where this return was 3 6 , 1 percent.

PftSi

- 7
I have said that corporate profits are one of the most
flexible elements in the economy, and profits in the cotton
textile industry are, more flexible than most; but there are some
who think this is carrying flexibility a little too far* The
cotton textile industry has had more than its share of boom
and bust—profits' in ✓ cotton goods manufacturing fell by about
87 percent between 1 9 1 9 'and 1 9 2 1 —and it may well be a proper
time now for cotton manufacturers to consider pricing-policies
more in line with the permanent preservation of their markets *
As you know, the stock market views the current earning
rate in^the cotton textile industry with a good deal of
skepticism. The stocks of some of the best companies in the industry are now selling at only two or three times 1 9 4 7 earn­
ings. Such skepticism runs- through the entire market, although
in less extreme degree. The prices of common stocks, as measured
by Standard and Poor's comprehensive -index-, are up only 31
percent from their 1939 average, despite the great increase in
corporate' profits and in the replacement value of the underlying
plants. The 50 industrial stocks included in Standard and
Poor's daily index are selling, on the average, at only about
o times their 1 9 4 7 earnings.
The increase in stock prices in the World War X period
was even less. Stock prices then reached their high for the
entire war period in 1 9 1 6 before the United States entered the
war. The average for I 9 1 9 —the highest postwar year—was only '
about 4 percent above that for 1914; and the average for 1 9 2 0 ■
was about 7 percent below 1914. Nineteen hundred and twenty •
stock prices, like those of the present time, represented a ..
conservative evaluation of current earnings-.
It may reasonably be -concluded, then, that the stock
market was not a-focal point of weakness in the economy at the
time of the 1920-21 recession, and that it is not now-, In both
cases, stock prices have failed to reflect, the full current •
level of corporate profits. This is quite the reverse of the
situation in I 9 2 9 , when the market was reflecting an expected
snarp rise in ..profits; so that even a leveling off of profits
would have.likely precipitated a stock market crash,
I come now to the field of urban real estate,
I have had the distinct impression that this is one field
r°rG vulnerable at the present time than it was in 1920k We
tho u Sht
the outcome, that the urban real estate
uaricet was one of the least' vulnerable elements in the 1 9 2 0 -/
rnp^ a't3'oru
is extremely-disconcerting to read such stateconcerning the present situation as that in the March
£C£oral Reserve Bulletin that,

5 8 -

. . ».Thé increase in mortgage indebtedness
on 1- to 4-fami'ly residences;, "for example, has been
estimated at 5.5 billion dollars for 1 9 4 7 / almost,
a billion more.than the 1946 growth and 5 billion
more than that .for 1945. Mortgage indebtedness on '
this type of housing has increased during the past .
two.years by an amount greater than new construction
expenditures on such housing. , . . "
_

ft

It is difficult,,to compare-the urban real estate situation
now and in 1920 because of the lack of reliable data Covering
both periods. Different indices of building costs, fo r'example,
vary widely among-' thornsel ve s ; and perhaps all fa il'to reflect
the actual results realized on the site. Nevertheless, it i s '
■ interesting to noté, that, the indices of building and construction
costs compiled-by the Engineering Nows-Becord, by the American ,
Appraisal Company.,, and by thé Assoc'i'ated tréneral Contractors, all
show a smaller increase since 1 9 3 9 than occurred between 1914 and
1920 .

'

According to the best estimates which we have been able to
obtain, total urban mortgage debt increased about 50 percent in
the eight years ended with 1947, as compared with an increase of
about 40 percent in the four years ended with 1 9 2 0 f
One of the considerations of present urban mortgage debt
is the long arm of, Government. It has been re caching out into
the field of guaranteeing mortgages, .with the possibility that
the Treasury may eventually be rapped, on the knuckleé. ' But such
an outcome, however unfortunate, would-, in any event, ameliorate
the situation from the standpoint of individual mortgagees andj’
to a lesser extent, individual mortgagors,
Among the favorable factors, it may be argued that monthly
payments, low Interest rates, and long amortization periods on
most existing mortgages will make'them easier to bear,
But I do not find that any of these considerations are able
to erase from my mind .the impression given by such statistics
as those on the relationship between the increase in mortgage
debt and new construction which I cited earlier from the Federal
Reserve Bulletin. Taken all in a ll, it appears to me that the
current urban real estate situation is perhaps one ,of the weakest
elements in todayrs economic picture.
,:
There ar.e several other important-economic5 fields that we
should examine in our analysis. However, the limitation of time
permits only.a.brief.mention.of some of them.

9
The gross public debt of the Federal Government is more
than ten times: as great as in 1920, This. is., more -than the
national gross product in 19*7*. It constitutes about sixty
percent of the total of all debt, public, and private,’ in the
United States, The,management of this debt imposes, upon the
Government the necessity of controlling interest.rates, not
only in the interest of the Government itself but in the interest
of our national economy * Every change in interest rate has
its impact on the financial and credit structure, It is reasonable
to expect that the management of this debt and the control of
interest rates which such management gives will be conducted in
the interest of the stability of our economy*
Fiscal policies of the Federal Government, budgetary
management and changes m our tax structure are also important
elements in our national economy. They constitute a large field
of discussion, which my time does not permit.
A factor of tremendous importance in our economy is the total of liquid assets held, by individuals aggregating approx­
imately 200 billion dollars at the present time. Of this
amount, nearly 1 5 0 billion dollars has, been accumulated during
the past eight years. Of this total amount, 6 7 billion dollars
represents individual holdings of United States Government
securities.
When we summarize all of the facts and factors of our present
economic situation as compared with 1 9 2 0 , we discover:
C-T) That there are basic elements of financial and economic
strength in^our economy today that proportionately can sustain,
a higher price level and a higher production than could be sus­
pired in 1 9 2 0 . In addition, there are fewer weaknesses in our
price structure and In the credit structure than in the former
period. These facts do not necessarily mean that both prices
and production may not decline. They do indicate, however, that
11 prices do not increase above current levels and if our credit
structure does not become weakened, prices are not,likely t o '
suffer the precipitous drop that occurred between May 1920 and
June, 1 9 2 1 .
.
'
mon ^:9°£ker Important, factor that was only slightly present In
but now has assumed large proportions, is the substantial
control of industrial wages by organized industrial labor. We
.c^ reasonably expect.a strong resistance to any serious decline
m wage levels,
,, T do not mean to say that we cannot expect price adjustments'*
the years ahead and the likelihood of price reductions in
Tines. As production and demand come into better balance
" are inevitable. At the moment, the task is"
v>-Tc
I-6 Tine on the inflation front and to prevent further
Pises that might eventually result in too costly readjustments.

- 3.0

X believe it is possible, to attain that objective, provided
there i s ' proper restraint on the, part of business, of. finance ’
of labor,; and of' Governmenti, To :pursue any. other course mayb" '
endanger not only our private- enterprise- system hut-democratic
government in this country as well.
\ -h'* .*

0O0 .

r s m m m vBPmmmt

Washington
m M M $mmim
M m M
AprU 23 ■
for

mmspapms

Press Service
Ko. S-

the Secretary of the Treasury announced today that
proposal« are being invited for furnishing distinctive
paper required for printing currency and public debt se­
curities of the United States for the fiscal year 1949» for
which bids will be opened at the Treasury Department on
Usy M , m

The estimated quantity of paper required for currency
is 116,300,000 sheets, or about 1404 tons, and for public
debt securities 10,173»000 sheets, or about 190 tons*

TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS
Friday, April 23, 19^8.______ _

Press Service
No. S-702

The Secretary of the Treasury announced today that
proposals are being invited for furnishing distinctive
paper required for printing currency and public debt
securities of the United States for the fiscal year 1949,
for which bids will be opened at the Treasury Department
on May 14, 1948.
The estimated quantity of paper required for currency
is 1 1 6 ,3 0 0 ,0 0 0 sheets, or about 1404 tons, and for public
debt securities 1 0 ,1 7 5 * 0 0 0 sheets, or about 1 9 0 tons,-

0O0

r

'V X >

7^3
- 3 of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections i±2 and

117 (a) (1) of the Internal Revenue Code* as amended by Section 115>, of the Reve­
nue Act of 19Ul, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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. I4.I8 , as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch,

Copies

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 Secretary of the Treasury 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 ary 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

April 00

19U8____ , in cash or other immediately avail­

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders will receive equal treatment.

Apr^T 29§ 19U8

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 tjie sale
or other disposition of the bills, shall not have any exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, whether Federal or State, but shall be exempt from all taxation now or
hereafter imposed on the principal or interest thereof by any State, or ary of the
possessions of the United States, or by any local taxing authority.

For purposes

Exhibit^!

mm
TREASURY DEPARTANT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Friday, April 23, 19US.

The Secretary of the Treasury, by this public notice, invites tenders for
$ 1,000,000,000

, or thereabouts, of

91

in exchange for Treasury bills maturing

-day Treasury bills, for cash and
April 29, 19U8

, to be issued on

a discount basis under competitive and non-competitive bidding as hereinafter
provided.
will mature
interest.

April 29, I 9I4.8
, and
---------July 29. 19k8____ when the face amount will be payable without

The bills of this series will be dated

They will be issued in bearer form only, and in denominations of

$ 1 ,000 , $ 5 ,000 , $ 1 0 ,000 , $ 10 0 ,000 , $ 500 ,000 , and $ 1 ,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
closing hour, two o*clock p.m., Eastern Standard time, Monday, April 26, I9I48
Tenders will not be received at the Treasury Department, V/ashington,

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 10 0 , 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. .
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

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS
Friday, April 23/-1948,
.

Press Service
No . S-703’

The Secretary of the Treasury, by this public notice,
invites tenders for $1,000,000,000, or thereabouts, of 9 1 -day
Treasury bills,.-..for cash and in exchange-for Treasury bills
maturing April 2 9 , 1948, 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 29;
1948, and will mature July 2 9 , 1948, when the face amount will
be payable without interest. They will be issued in bearer ■
form only, and in denominations of $1 ,0 0 0 , $5 ,0 0 0 , $ 1 0 ,0 0 0 ,
$1 0 0 ,000 .,- $'5 0 0 ,0 0 0 , and $ 1 ,00.
0 ,0 0 0 (maturity value).
Tenders will be received at Federal Reserve Banks and 1
Branches' up to the closing hour, two 0 'clock p.m./..Eastern- .
Standard time, -Monday, April 26, 1948.- Tenders will not be
received at the.’Treasury Department, Washington. Each tender:',
must be for ah even multiple of $ 1 ,0 0 0 , and in the case of - ...
competitive tenders the price offered must be expressed on-the
basis of 1 0 0 , 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 ®n
application therefor.
.

..

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 Secretary of the Treasury
of the amount and price range of accepted bids. Those submitting
tenders will be advised of the acceptance or rejection there#f.
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 $2 0 0 ,0 0 0 or less
without stated price from any one bidder will be accepted in
full at the average price (in three decimals); ^f accepted compe­
titive b i d s S e t t l e m e n t for accepted tenders in accordance with
the bids must be made or completed at the Federal Reserve Bank
on April 29, 1948, in cash or other Immediately available funds
or in a like face amount of Treasury bills'maturing April 2 9 , 1948.

- 2 "-

Cash and exchange^ tenders will receive equal treatment. Cash
adjustments will fee made for differences between the par value
of maturing bills accepted in exchange arid the issue price of
'the new b ills.
The income derived from Treasury b ills, whether interest
or gain from the sale or other disposition of the b ills, shall
not have any., exemption, as such, and loss from the sale or
other disposition o:f Treasury bills shall hot have any special
treatment, as such> under the Internal Revenue Code, or laws
•amendatory or supplementary thereto. The.bills shall be subject
to estate, inheritance, gift or other excise taxes, whether
Federal or State, but shall be exempt from all taxation now or
hereafter'imposed on the principal or interest thereof by any
State, or any of the possessions of tho 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 shall be considered to be interest. Under
Sections 42 and 117 (a) (l) of the Internal Revenue Code, as
amended by Section 115 of . the Revenue Act of 1941, the amount of
discount at which bills issued hereunder are sold shall not be
considered to accrue until such bills shall be sold, redeemed or
otherwise disposed of, and such bills are excluded from considera
tion 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, as amended, and this
:notice, prescribe the terms of the Treasury bills and.govern
the conditions of the.ir issue. Copies of. the circular may be
obtained from any Federal Reserve Bank or Branch.
0O0

The S e c re ta ry o f the Treasury and the Attorney General a lso announced
the conclusion o f d iscu ssion s between rep re sen ta tiv e s o f th e ir two depart­
ments, the Department o f S ta te and a D elegation o f the Swiss Government*
These d iscu ssio n s concerned the extension to Sw itzerland o f the three month
period in which to process a p p lica tio n s f ile d by June 1 , and various
problems o f in t e r e s t to the Swiss in connection w ith the term ination of
the c e r t i f i c a t i o n procedure*

/}

£**y\*P I

issUA,

xSASUHI DEPARTMENT
Washihgton
g,

MOHNIHG NEWSPAPERS,
. A p r i l 2 7 , 1948__________________

.-

Press Service
No. S' JO^

3!tie S e cre ta ry o f the Treasury and the Attorney General today announced
th a t a f t e r June 1 , 1948 no a p p lica tio n f o r c e r t i f i c a t i o n under General License
No* 95 may be accepted by the c e r tify in g agencies of the cou n tries included
w ithin the p riv ile g e s o f General License No* 95* However, these countries
w ill have u n til September 1 , 1948 to complete a ctio n on a p p lica tio n s fo r
c e r t if ic a t io n under General License No, 95 which are on f i l e with the c e r t i­
fy in g agencies of^such co u n tries on o r b efore June 1 , 1948. In th is connec­
tio n , i-hey emphasized th a t when a re sid e n t o f one blocked country holds assets
through another such country, he must apply by June 1 , 1948 to the certify in g
agency o f h is country o f residence fo r the necessary supplemental c e r t i f i c a ­
tio n in order to perm it the c e r tify in g agency o f the country through which he
holds h is a s s e ts to process b is a p p lica tio n during the extension period.
In commenting on the period which i s being .given to allow fo r the pro­
cessin g ox a p p licatio n s on f i l e on June 1 , 1948, the S e c re ta iy o f the Treasury
and the Attorney General sta ted th a t th is government i s receiv in g the commit­
ments o f the governments o f cou n tries admitted to the p r iv ile g e s o f General
License No. 95 th a t the c e r tify in g agencies o f such governments w ill not
c e r t i f y tne a s s e ts o f blocked n a tio n a ls who are not c itiz e n s or long-time
resid en ts o f such countiu.es* ^ The United Dtates w i ll follow the same licensing
p o lic y in handling unblocking a p p lica tio n s o f persons who have ©migrated into
the United S ta te s and the gen erally licen se d trade a rea . This a c tio n i s
d irected toward preventing resid en ts o f r e c ip ie n t cou n tries from taking
advantage o f b r ie f residence in o th er cou n tries to ob tain the unblocking of
th e ir a sse ts in tne bnited S ta te s w ithout the knowledge o f the cou n tries which
th is government i s a s s is tin g under the European Recovery Program.
The S e cre ta ry o f the Treasury and the Attorney General added th a t in
executing th is government's program fo r term inating the freez in g co n tro ls,
as s e t out in the ]g t t e r o f February 2 , 1948 to Senator Vandenberg, the
Treasury Department w ill fo r ad m in istrative convenience r e ta in ju r is d ic tio n
oyer blocked funds u n til September 1 , 1948. Thus the Treasury Department
w ill during the period irom June 1 to September 1 , 1948 take the f i r s t , steps
in executing the program c a lle d f o r in the l e t t e r to Senator Vandenberg. I t
w ill take the census o f property blocked as o f June 1 , 1948 and w i ll in it ia t e
the transm ission to the r e c ip ie n t cou n tries o f the in foim ation obtained from
bhe census w ith re sp e ct to the blocked property In the United S ta te s o f
n a tio n a ls o f such c o u n trie s.

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS,
Tuesday, April 27, 19^8 _____

Press Service
No. S-?04

The Secretary of the Treasury and the Attorney General today
announced that after June 1, 1948 no application .for certification
under General License No. 95may be accepted by the certifying
agencies of the countries included within the privileges of General
License No. 95* However, thèse countries will have until
September 1, 1948 to complete action on applications for certifi­
cation under General License. No, 95 which are on file with the
certifying agencies of such countries on or before June 1, 1948.
In this connection, they emphasized that when a resident of one
blocked country holds assets through another such country, he must
apply by June 1, 1948 to the certifying agency of his country of
residence for the necessary supplemental certification,in order to
permit the certifying agency of the country through which he holds
his assets to process his application during the extension period.
In commenting on the period which is being given to allow
for the processing of applications on file on June 1, 1948, the
Secretary of the Treasury and the Attorney General stated that this
government is receiving the commitments of the governments of
countries admitted to the privileges of General License No. 95
that the certifying'agencies of such governments will not certify
the assets df blocked nationals who are not citizens or long-time
residents of such countries. The United States will follow the
same licensing policy in handling unblocking applications of
persons who have emigrated into the United States and the generally
licensed trade area. This action is directed toward preventing
residents of recipient countries from taking advantage of brief
residence in other countries to obtain the unblocking of their
assets in the United States without the knowledge of the countries
which this government is assisting under the European Recovery
Program,.
The Secretary of the Treasury and the Attorney General added
that in executing this government's program for terminating the
freezing controls, as set out in the letter of February 2, 1948
to Senator Vandenberg, the Treasury Department will for administra­
tive convenience retain jurisdiction over blocked funds until
September 1, 1948. Thus the Treasury Department will during
the period from June 1 to September 1, 1948, take the first steps
in executing the program called for in the letter to Senator
Vandenberg. It will take the census of property blocked as of
June l, 1 9 4 8 and will Initiate the transmission to the recipient
countries of the information obtained from the census with respect
to the blocked property In the United States of nationals of such
countries.
The Secretary of the Treasury and the Attorney General also
announced the conclusion of discussions between representatives of
their two departments, the Department of State and a Delegation'of
the Swiss Government.- These discussions concerned the extension to
Switzerland of the three month period in which to process applica­
tions filed by June 1, and various problems of interest to the Swis
m connection with the termination of the certification procedure.
oOo.

r m m m rnmmmt
te¿i&|loa

The ¿eeretary of the Treasury announced last evening that the tenders for
11,000,000,300, o* thereabouts, of 91-day Treasury bills to te dated April 29 and to
■atare July E t* 1948, which «ere offered April 03, 1048, «ere opened et the Federal Ft*
aeree Banks on April id*
The details of this lesee axe as follows:
total applied for - #1,635,442,000
total aeoopted
* 1,008,440,000 (lusiade* #40,408,000 esterad on a wm~
cotapetitlve baste and accepted to fell at
the average price sismi below)
Average prise
« 00*048 Äquivalent rate of diseomt approx* 3.990$ per oa&ua
lange of accepted cosipetltive bide:
High
Low

- 00.052 Equivalent rate of discount approx. 0«9&1$ per annua
m
m m
«*
w
- 00.040
1.001$ •
»

(48 percent of the amount bid for at the low pries was accepted)

Federal Reserve
District

total
Applied for

Total
Accepted

Boston
lew York
Philadelphia
Cleveland
Mahnend
Atlanta
Chisago
Bt. Leals
Minneapolis
Mensas Oily
Balias
isa Francisco

1
18,058,000
1,305,540,000
85,030,000
30,008,000
3,480,000
8,444,000
•5,848,000
2,215,000
2,105,000
10,350,000
0,040,000
76.792.000

•

11,688,442,000

11,006,649,000

tom

14,785,000
858,980,000
5,008,000
23,054,000
5,687,000
2,444,000
42,042,000
2,069,000
1,857,000
17,1»,000
8,891,000
48.198,000

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS
Tuesday, April 27, 19^8.

Press Service
No. S-705

The Secretary, of the Treasury announced last evening that
the tenders for $ 1 , 0 00 , 0 0 0 , 0 00 , or thereabouts, of 9 1 -day
Treasury bills to be dated April 29 and to mature July 2 9 , 1948,„
which were offered April 23., 19^8, were opened at the Federal
Reserve Banks on April 26.
The details of this issue are as follows:
Total applied for = $1,655,^42,000
Total accepted
- 1,005,649,000 (includes $40,422,000 entered on
a non-competitive basis and accepted in full
at the average price shown below)
Average price - 99*748 Equivalent rate of discount approx. 0.997$
per annum
Range of accepted competitive bids;
High = 99.752 Equiv. rate of discount approx. 0 . 9 8 1 $ per annum
Low - 99.747
"
M M
"
M 1.001$ "
"
(48 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

à

$

$

1

1 8 , 055,000
395.560.000
2 5 , 0 3 0 ,0 0 0
37.908.000

3 ,687,000

TOTAL

$1

14,755,000

8 3 2 ,980,000

5.798.000

2 5 . 056.000
3 ; 687,000

2.444.000

2.444.000
6 5 .2 4 2 .0 0 0
2 .215.0 0 0
2 .105.000
1 7 .357.000
9.047.000
7 6 .792.0 0 0

48.192.000

6 5 5 .442.000

$1,005,649,000

0O0

4 2 .962.000
2 . 059.000
1 .6 3 7 .0 0 0
1 7 . 188.000
8 .891.000

ill
- 2 ~
Club1*'''
University/ Country Club, Albuquerque, university and Army and

Navy,Clubs

Washington, D*C., and Harvard Club, New York City*
FoHuwin£~

if e H a m

IhTlnaBlt

mmmsfesm

i i n iJ s i i iiMdbiu

two children.

Sheila and Lon Mcl&llen Rodey,

H

»

M

M

^ 3'gi"1he ^

K> •

M

w

Wednesday, April j
For release XiiestisgcpdqBxjdbdtit

New

Mexico! feae-4

alohaJERfliydcr,/as state chai:

TO:

Mr. Dillon

The attached release for your
approval. Please return 250
copies to this office after it has
been mimeographed. Thanks.
3 copies attached for press assns.

ia.

on

7

thfr TTPaeupy pe[wi1minil diiimiu

Jake Mogelever

He succeeds Nolan P* 1
Albuquerque* Secretary SnydeJ
ing his patriotic services*
In accepting the chaii
of this appointment* I also t
the Savings Bonds program in <
Louis Carow

imperative in view of world cc

•ng

record as a public-spirited citizen. As an attorney he represents the First
with many leading business institutions*
iipwas born in thnt ^j^y^ovember 8, 1889* He graduated from Mercersbur
Academy in 1907 with an A.B., Harvard, 1912,

LLB,

Pa*,

and began practice in ATbnqnerque/
"

1...

In 1925-26,
Mr* Rodey was attorney for thB Middle Riof Grande Conservancy
✓
District; associate counsel for the N. M. Rio Grande^Sornpa^ counsel for N*M.
conference of Upper Basin States for division of waters of the Colorado River;
state representative to national conference on Uniform Aeronautic Regulatory laws
■ 1^30; and delegate to Comparative law Conference, The Hague, 1937^ Republican
nominee for Congress 1938*1 ¡lie is vice president and director of the Occidental/
life Insurance Co*, Raleigh, N. C*, director, Peninsular Life Insurance Co*,
Jacksonville, Florida,; Chancellor, Episcopal Diocese and a It,, U* S* Naval Reserv#*
j He is a member of the American Bar Association, New Mexico State Bar and

Albuquerque lawyers Club,

American

Legion, Sigma Chi, a Shriner, member of Kiwanis,

Wednesday, A p r il 28th
For release leeadagcpd^nddbdtit P.M. Newspapers
%

’earce C. ^odey, a lead in g atto rn ey in.
New MexicqJ hag been appointed'by ’SECretary* of uhe Trfeaghfry
frj/ e
_
n
d
-.Tohn W^ar flw^^n-rj /as state chairman of the Uni bwA vtatlb Savings Bonds Division/

'^¿*jT A «*y G / &&

>C

' v

_

thn TTTinamj Tlrii'ni lurrurt flnnminrii l f mir l lnRliinflnn today.

He succeeds Nolan p. Walter, President of the New Mexico State Bank at
Albuquerque.

Secretary Snyder paid high tribute to the retiring chairman, laud­

ing his patriotic services«
In accepting the chairmanship, Mr. Rodey said*
of this appointment.

«1 appreciate the honor

I also realize the responsibilities because the success of

the Savings Bonds program in every community in every state of the land is

Im perative in view o f world c o n d itio n s. n
long

record as a p u b lic -s p ir ite d c it iz e n .

As an a tto rn e y he rep resen ts the F ir s t

N ational Bank i n Albuquerque, togeth er w ith many lead in g business in s tit u t io n s .
lov ember 8, 1889.

He graduated from Mercers bur f t p P a .,

Academy in 1907 w ith an A. B ., Harvard , 1912, LLB, and began p r a c tic e in Albuquerque,
in 1915* f In 1925-26, Mr. Rodey was a tto rn e y f o r the Middle Rio Grande Conservancy
D is t r i c t ; a s s o c ia te counsel f o r the N. M. Rio Grande^Sonpact ^ counsel f o r N.M.
conference o f Upper Basin S ta te s f o r d iv is io n o f w aters o f the Colorado R iver;
s ta te re p re se n ta tiv e to n a tio n a l conference on Uniform Aeronautic Regulatory laws
in 1930; and delegate to Comparative Law Conference, The Hague, 19371 Republican

%

nominee f o r Congress 1938$ Me i s v ic e p resid en t and d ir e c to r o f the
L ife Insurance Co*, R a le ig h , N. C ., d ir e c to r , Peninsular L ife Insurance Co.,
J a ck so n v ille , F lo r id a ,; C hancellor, Sp iscop al D iocese and a L t ., U. S. Naval Reserve
Me i s a member o f the American Bar A sso cia tio n , New Mexico S ta te Bar and
Albuquerque lawyers Club, American Legion, Sigma Chi, a Shriner, member of Kiwanis,

TREASURY DEPARTMENT
Washington

FOR RELEASE, AFTERNOON NEWSPAPERS,
Wednesday, April 28, 19^8.________

Press Service
Wo. S-706

Secretary Snyder today named Pearce C. Rodey, a leading
attorney of Albuquerque, New Mexico, as state chairman of ,the
Treasury Department's Savings Bonds Division.for New Mexico.
He succeeds Nolan P. Walter, President of the New Mexico
State Bank at Albuquerque. Secretary Snyder paid high tribute
to the retiring chairman, lauding his patriotic services .
In excepting the chairmanship, Mr.- Rodey said: "I
appreciate the honor of this appointment. I also realize
the responsibilities because the success of the Savings Bonds
program in every community in every state of the land is
imperative in view of /world conditions."
Mr. Rodey was born in Albuquerque on November

8 , 18 8 9 .

He graduated from Mercersburg', Pennsylvania Academy in 1907
with an A.B., Harvard, 1912, LLB, and began practice in
Albuquerque in 1915. He has a long record as a public-spirited
citizen. As an attorney he represents the First National
Bank in Albuquerque, together with many leading business
institutions. In 1 9 2 5 -2 6 , Mr. Rodey was attorney for the
Middle Rio Grande Conservancy District; associate counsel for
the N.M. Rio Grande Compact, counsel for N.M. conference of
Upper Basin States for division of waters of the'Colorado
River; state representative- to national conference on Uniform
Aeronautic Regulatory Laws in 1930; and delegate to Compara­
tive Law Conference, The Hague, 1937/ and Republican nominee
for Congress, 1938. He is vice president and director of
the Occidental Life Insurance Co., Raleigh, North Carolina,
director, Peninsular Life Insurance Co., Jacksonville, Florida;
Chancellor, Episcopal Diocese and a L t ., U. S'. Naval Reserve,

Mr. Rodey is a member of the American Bar Association,
New Mexico State Bar and Albuquerque Lawyers Club, American
Legion, Sigma Chi, a Shriner, member of Kiwanis, University
Club, Gountry Club, Albuquerque, University, and Army and
Navy Clubs, Washington, D. C., and Harvard Club, New'York.City.
y

Mr. Rodey is married and has two children, Sheila and
Lon McMillen Rodey,

2

-

2*

Form W-<•4 (revised April

-

1948)^

M

mbssépb

the exemption certificate

which an employee gives his employer to obtain the personal and family
exemptions to which he is entitled for withholding purposes.

before the end of the year*

This form was

Other employees do not need to change their

exemption certificates, and, as an economy measure, employers are urged to
use up their stocks of old Forms W-4 for such employees*

The new forms will

be furnished in reasonable quantities to employers, on request, and employees
needing the new form should ask their employers for them.

3*

Form 1040-ES (

1

9

4

8

)

Twenty miilribge?r^p!r

the form and instructions for estimating

revised so as to Tes^asaàmm on the back page the^ table
rates and computation under the new law*

Taxpayers who estimated on the basis

ituLv /#*****♦
of the old law may re-estimat^and reduce any remaining installments according­
ly.

^ r i li 1ifilllin inwmifilium pf1tll1T~Tn'nrWT^nT^'^i8^'i

Brown ink was used to

distinguish the new form from the old*
The new withholding rates apply to all wages and salaries paid on and
after Saturday, May 1, regardless of when they were earned.
holding was

Although with­

at the old rates between January 1 and May 1, no refunds

can be paid until final income tax returns are filed after January 1, 1949*

TREASURY DEPARTMENT
Bureau of Internal Revenue
Washington, 25, D. C.
Press Service:

For Releases
\

George J. Schoeneman, Commissioner of Internal Revenue, announced
today that the reduced rates of income tax withholding from salaries and
wages will go into effect Saturday, May 1, as provided by the Revenue
Act of 1948«
The Commissioner said all necessary withholding tables and other
instructions needed by employers to put the new rates into effect have been
printed and distributed.

If any employer has failed, through inadvertence,

to receive them, he should request them immediately from the Collector

of

Internal Revenue in his district*
Revised instructions and forms for taxpayers desiring to amend
Declarations of Estimated Tax also have been printed.

Copies will be mailed

late in May to taxpayers who owe a June 15 installment on a previously-filed
Declaration for 1948, and other taxpayers may get them on request from the
nearest collectors office.
Prompt issuance of these forms and instructions was made possible by
drafting the material and having all of it set in type, ready for printing,
before the passage of the new law.
The revised forms include:
1.

Circular WT-Revised 1 9 4 8 ^ SteftBWll a pamphlet which contains all the

necessary instructions, tables, rates, and other information for an employer
in connection with the withholding of income tax from wages and salaries*

TREASURY DEPARTMENT
Bureau of Internal Revenue
Washington

FÖR IMMEDIATE RELEASE
Wednesday,, April 28, 1948.

Press Service
No. S - 7 0 7

George J. Schoeneman, Commissioner of Internal Revenue,
announced today that the reduced rates of income tax with­
holding /from salaries and wages will go into effect Saturday,
May 1, as provided by the Revenue Act of 19^8.
The Commissi6 ner said all necessary withholding tables
and other instructions needed by employers to put the new rates
into effect have been printed and distributed, if any em­
ployer has failed, through inadvertence, to receive them, he
should request them immediately from the Collector of Internal
Revenue in his district.
Revised instructions and forms for taxpayers desiring to
amend Declarations of Estimated Tax also have been printed.
Copies will be mailed late in May to taxpayers who owe a June
15 installment on a previously-filed Declaration for 1 9 4 $, and
other taxpayers may get them on request from the nearest
collector’s office.
Prompt issuance of these forms and instructions was made
possible by drafting the material and having all of it set in
type, ready for printing, before the passage of the new law.
The revised forms include:
1. Circular WT-Revised 19^8, a pamphlet which contains
all the necessary instructions, tables, rates, and other infor­
mation for an employer in connection with the withholding of
income tax from wages and salaries.
f
Form W-4 (revised April 19^-8), the exemption certiUcate which an employee gives his employer to obtain the
and
exemptions to which he is entitled for ithholding purposes. This form was revised to cover the ad­
ditional exemptions provided by the 19^8 Act for employed
persons and their wives or husbands who are blind or who will
de 05 or older before the end of the year. Other employees
0 not need to change their exemption certificates, and, as an
n?Sn2 my measure* employers are urged to use up their stocks of
ni >,FSrinS
for such employees. The new forms will be furp™ v *
reasonable quantities to employers, on request, and
unpioyees needing the new form should ask their employers for

Bpj
- 2

3 , Form 1.0^0-ES (19^8), the form and instructions for
estimating tax for 1 9 ^8 , revised so as to include on the back
page the tax table, rates and conputation under the new law.
Taxpayers who estimated on the basis of the old law may reestimate on these forms and reduce any remaining installments
accordingly. Brown ink was used to distinguish the new form
from the old.

The new withholding rates apply to all wages and salaries
paid on and after Saturday, May 1, regardless of when they
were earned. Although withholding was at the old rates between
January 1 and May 1, no refunds can be paid until final income
tax returns are filed after January 1, 19^9*

0O0

the i c e b e r g m e n a c e ends in e a r l y July,
a l t e r n a t e in m a i n t a i n i n g
In November,

the two cutters will

cont i n u o u s patrol' of the area.

1 9 1 3 ^ a yea r a f ter the W h i t e

Star liner

TITANIC

struck an ic e b e r g a n d sank w i t h over 1,500 persons

aboard,

the I n t e r n a t i o n a l C o n f e r e n c e on the S a f e t y of Life

at Sea e s t a b l i s h e d the Ice P a trol a nd n a m e d the U n i t e d States
Coast G u a r d as the r e s p o n s i b l e a g e n c y for its m aintenance.
The p a trol was d i s c o n t i n u e d in 1942,
into W o r l d W a r II,

f o l l o w i n g A m e r i c a n entry

and was r e i n s t i t u t e d in the spring of

1 9 ^6 , w h e n the aerial r e c o n n a i s s a n c e p l a n e s were first used.
U n d e r the terms of the S a f e t y of Lif e at Sea Conference,
fourteen nations

i n t e r e s t e d in t r a n s a t l a n t i c commerce

tribute to the ex p e n s e

of m a i n t a i n i n g

the p a t r o l .

con­

Ptfior

to W o r l d W a r II, G r e a t B r i t a i n and N o r t h e r n I r e l a n d contributed
41 p e r c e n t

of the cost,

b y the U n i t e d States.

as a g a i n s t an l8 p e r c e n t

contribution

Suggested Press Release

Morning Newspapers,
Thursday, April 29, 19^8»

The International Ice Patrol, maintained by the United
States Coast Guard since 1914, began its annual surface
search for icebergs along the steamer lanes of the North
Atlantic yesterday, with the arrival of the Cutter MENDOTA
in the Grand Banks area off the coast of Newfoundland.
An announcement by Secretary Snyder reveals that since
early February, converted Coast Guard "flying fortresses”
have flown more than fifty survey missions out of Argentia.
These planes literally "ride herd” on the mammoth ice masses,
which are calved from Western Greenland glaciers, as they
approach the transoceanic lanes of commerce.
Around May 1, persistent fogs blanket the Grand Banks
vicinity, making further aerial reconnaissance undependable.
Then the cutters, aided by radar and other electronic gear,

move in to patrol the danger area, which is considerably
larger than the State of Pennsylvania.

These ships locate

bergs reported by the survey planes, chart their position/^
and drift, and summarize the information in dispatches broad­
cast twice daily to all shipping on the Great Circle route to
European ports.

^

'

Three weeks hence the MENDOTA will be relieved by the
MOCOMA, which sailed today from Miami.

Thereafter, until

TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Thursday, April 29, 1948.

Press Service
No. S-708

The International Ice Patrol, maintained by the United States
Coast Guard since 1914, began its annual surface search for ice­
bergs along the steamer lanes of the North Atlantic yesterday,
with the arrival of the Cutter MENDOTA in the Grand Banks area
off the coast of Newfoundland.
An announcement by Secretary Snyder reveals that since early
February, converted Coast Guard "flying fortresses" have flown
more than fifty survey missions out of Argentia. These planes
literally "ride herd" on the mammoth ice masses, which are calved
from Western Greenland glaciers, as they approach the transoceanic
lanes of commerce.
Around May 1, persistent fogs blanket the Grand Banks
vicinity, making further aerial reconnaissance undependable.
Then the cutters, aided by radar and other electronic gear, move
in to patrol the danger area, which is considerably larger than
the State of Pennsylvania. These ships locate bergs reported by
the survey planes, chart their position and drift, and summarize
the information In dispatches broadcast twice daily to all ship­
ping on the Great Circle route to European ports .
Three weeks hence the MENDOTA will be relieved by the MOCOMA,
which sailed today from Miami. Thereafter, until the iceberg
menace ends in early July, the two cutters will alternate in
maintaining continuous patrol of the area.
In November, 1913* a year after the White Star liner TITANIC
struck an iceberg and sank with over 1 , 5 0 0 persons aboard, the
International Conference on the Safety of Life at Sea established
the Ice Patrol and named the United States Coast Guard as the responsible-agency for Its maintenance, The patrol was discon­
tinued in 1942, following American entry into World War II, and
was reinstituted in the spring of 1946, when the aerial
reconnaissance planes were first used.
Under the terms of the Safety of Life at Sea Conference,
fourteen nations interested in transatlantic commerce contribute
to the expense of maintaining the patrol* Prior to World War II,
Great Britain and Northern Ireland contributed 4l percent of the
2°st, as against an 18 percent contribution by the United
States.

,'.**7

•

» 3‘ «

• rH ff/

7 2? "7

My dear Mr. Secretary:

^

| itTjae National Safety Council has watched with interest the prepress of the current
War Trophy Drive, which you launched last year with the assistance •£ the Army, Navy,
and National Eif le Association.
)MA11 of those concerned in the effort are to he commended for this splendid public
service. We concur with the President's opinion that the failure to meet such an
emergency after past wars ^has cost thousands of lives anu millions of cellars.
2«That your work has already demonstrated its value is reflected in the comparatively
low casualty rate in this field for the year 1947. Experts estimated that it would
climb shanoly due to the number of dangerous souvenirs brought into the country.
That has not been the case, and we feel sure your timely action has been responsiole.
This information should be gratifying to you and your co-workers.
"Please extend to them our sincere good wishes and please accept our offer of all
the assistance our facilities afford."

Sincerely
(Signed) Bed H. Dearborn
led E. Dearborn
President"

i

TREASURY DEPARTMENT
Washington 25, D*C.

/ 'V/p<y/V£
Press Service
No. 5 *7Ù

Secretary Snyder, in behalf of the National War Trophy Safety Committee,
made public today a letter received from the National Safety Council, crediting the
safety drive -with materially reducing civilian casualties from the handling of dan­
gerous war souvenirs*
Ned H. Dearborn, the C o u n c i l s President, declared that the experts had
predicted a sharp rise in accidental death due to the influx of millions of explosive
•war trophies, but that the casualty rate from this cause was low, due, says Dearborn,
to the timely action of the Committee.
The War Trophy Safety Committee was created in May of last year— a voluntary
group representing the Army, Navy, Treasury Department, and The National Rifle
Association.

The Air Force, which has since been established as a coordinate Depart­

ment of the National Military Establishment, has been invited to participate in this
public service.
That the Committee’s work has been effective is evidenced b y the statistics
showing that the local Trophy Groups, as of March 31st, 1948, have examined
approximately 200,000 pieces of ordnance; they have advised some 50,000 persons on
the safe handling of rifles and pistols retained as sporting arms; and have deactivated
about 25,000 highly explosive souvenir shells, grenades, bombs, booby-traps, etc*
It is interesting to note that many of the trophies deactivated were of World War I,
Spanish-American War, and Civil War vintage 1
Authorities declare that although 200,000 pieces of death-dealing ordnance have
already been screened, that figure represents but a small proportion of the deadly
materiel in circulation.
Mr. Dearborn’s letter follows:
’’The Hon, John W, Snyder
Secretary of the Treasury
Washington, D. C.

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS
Friday, April 30* 19^-8._____ ___

Press -Service
Nev S - 7 0 9

Secretary Snyder, in hehalf of the National War Trophy
Safety Committee, made public today a letter received from the
National Safety Council, crediting the Committee’s safety drive
with materially reducing civilian casualties from the handling
of dangerous ^ar souvenirs.
Ned H, Dearborn, the Council’s President, declared that
the experts had predicted a sharp rise In accidental death due
to the influx of millions of explosive war trophies, but that
the casualty rate from this cause was low, due, says Dearbornj
to the timely action of the Committee.
-The War Trophy Safety Committee was created in May of last
year— a voluntary, group representing the Army, Navy, Treasury
Department, and The National Rifle Association. The Air Force,
which has since been established as a coordinate Department ofthe National Military Establishment, has been Invited to parti­
cipate in this public service^
That the,Contmittee ’s work has been effective is evidenced
by the statistics showing that the local Trophy Groups, as of
March 31st, 1048, have examined approximatelyf 2 0 0 ,000 pieces
of ordnance; they have advised some 5 0 * 0 0 0 persons oh the safe
handling of rifles and pistols retained as sporting arms; and
have deactivated about 2 5 ,0 0 0 highly explosive souvenir shells,
grenades, bombs, booby-traps, etc. It Is Interesting to note
that many of the trophies deactivated were of World War 1,
Spanlsh-American War, and Civil War vintage.
Authorities declare that although 200,000 pieces of death­
dealing ordnahce have already been screened, that figure
represents but a small proportion of the deadly materiel In
circulation.
Mr. Dearborn’s letter follows:
"The Hon. John W, Snyder
Secretary of the Treasury
Washington, D. C.
ffly dear Mr. Secretary:
"The National Safety Council has watched with
interest the progress of the current War Trophy
Drive, which you launched last year with the
assistance of the Army, Navy, and National Rifle
Association.

2
"All of those .1 concerned in the effort are to
be commended for this splendid public service/ We
concur with the president's opinion that the failure
to meet such an emergency after past wars 'has cost
thousands of lives and millions of dollars'.'
'’That your wofk has already demonstrated its
value is reflected in the comparatively low casualty
rate in this field for the year 19^7# Experts
estimated that it would climb sharply due to the
number of dangerous souvenirs brought into the
country. That has not been the case, and we feel
sure your timely action has been responsible. This
information should be gratifying to you and your
co-workers.
"Please extend to them our sincere good wishes
and please accept our 'offer of all the assistance
our facilities afford.
Sincerely,
(Singed)

oOo

Ned H. Dearborn
Ned H. Dearborn
President"

IXRYLK

-3 of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections U2 and

117 (a) (1) of the Internal Revenue Code, as amended by Section 115> of the Reve­
nue Act of 19hl, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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. Ul 8 , as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

n

7'/>
-

2

-

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 Secretary of the Treasury 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 competitive bids,

Sett3.ement for

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

May 6 , I 9I48

, in cash or other immediately avail­

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders will receive equal treatment.

May 6 , 19U8

Cash adjustments will be

made for differences between the par value of maturing bi3.1s 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, shall not have any exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, whether Federal or State, but shall be 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

Exhifeifcxì
J&EM
TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Friday, Aoril 30, 191*8.
—
--------------------

The Secretary of the Treasury, by this public notice, invites tenders for
$ 900,000,000

i or thereabouts, of

91 -day Treasury bills, for cash and

May 6 , 19lt8
, to be issued on
------ --------------a discount basis under competitive and non-competitive bidding as hereinafter
in exchange for Treasury bills maturing

provided.

Mi

will mature August £, 19 U 8
interest,

May 6 , 19h8
, and
w '
______, when the face amount will b e payable without

The bills of this series will be dated

They will be issued in bearer form only, and in denominations of

$ 1 ,000 , $£,000, $ 1 0 ,000 , $ 10 0 ,000 , $£00 ,000 , and $ 1 ,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
daylight saving
closing hour, two o Tclock p.m., Eastern/SfcacHtasd: time, Monday, May 3, 191*8_____ •
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 10 0 , 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.
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

TREASURY DEPARTMENT
Washington
FOR RELEASE, MORNING NEWSPAPERS, '
Friday,: April 30, 1948.
'

\

Press. Service
No. S-710

The Secretary o f .the Treasury, by this public notice,
invites tenders for $9 0 0 ,0 0 0 ,0 0 0 , or thereabouts, of 9 1 -day
Treasury bills, for cash and in exchange for Treasury bills
maturing May 6 , 1948, to be issued on a discount basis under
competitive and:non-competitive bidding has hereinafter- provided.
The bills-of this series vili be dated May 6 , 1948*. and will
mature August 5*.1948, when the face amount will be payable with­
out interest. They will be issued in bearer form.only,.and i n :
denominations of $ 1 ,0 0 0 , $ 5 ,0 0 0 , $1 0 ,0 0 0 , $1 0 0 ,0 0 0 $ 5 0 0 ,0 0 0 , and
$1 ,0 0 0 ,0 0 0 (maturity value). 1
Tenders will be received at Federal Reserve Banks and .
Branches up to the closing hour, two o ’clock p.m., Eastern day­
light saving time,- Monday, May 3, 1948. Tenders will not be
received at the Treasury Department, Washington. Each tender
must be for an even multiple of $1 ,0 0 0 , and in the case of compe­
titive tenders the price offered must be expressed on the basis
of 1 0 0 , with not more than three decimals, e . g ., 99 .9 2 5 .
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 applicaidh therefor.’
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 Secretary of the Treasury 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 $2 0 0 ,0 0 0 or.less with­
out stated price from any one bidder will be accepted in full
at the average price (in three decimals) of accepted competitive
s * Settlement for accepted tenders in "accordance with the
o-Ms must be made or completed at the Federal Reserve Bank on
o, 1948, in cash or other immediately available funds or In

- 2 -

a' like face, amount of Treasury bills maturing. May 6', 1948-, Cash
and exchange tenders will receive equai treatment, Cash adjust­
ments' will be made for differences between the par value, of
maturing bills accepted in exchange and the issue price, of the
new b i l l s I
■
The income derived from Treasury, b ills, whether interest or
gain from the. safe or other disposition of the bills, shall not
have any. exemption, as such, and loss from the sale or other disposition of Treasury bills shall not have any special treat­
ment, as such, under the Internal Revenue Code, or-laws
amendatory or supplementary thereto. The bills shall be subject
to estate, inheritance, gift or other excise taxes, whether
Federal or State, but shall be 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. byany
local taxing authority, For purposes of taxation the amount of
discount at which Treasury bills are originally"sold by the
United States shall be considered interest, Under Sections 42•
and 117 (a) (1) of the.Internal Revenue Code, .as amended by
Section 1 1 5 of the Revenue Act of 194-1,. the. amount cf discount. .
at which bills issued hereunder are sold shall not be considered
to accrue until such bills shall bo 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 b ills, 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 Wo. 4l8, as mended,; 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.

-

The

2

-

Secretary said the banks had given

a "cheering response" to President Truman1s
appeal for restraint of inflationary credit.
Secretary Snyder said that, "In view of
the continuing inflationary pressures, it is
important that the banks keep up their splendid
work."

Press Statement by Secretary Snyder
April 2 9 , 19US
For Immediate Release

Secretary Snyder today expressed his
appreciation of voluntary action by the Nation1s
private banks in restraining inflationary business
credits.

/

The Secretary called attention to a Federal
Reserve Board report showing that commercial,
industrial amid agricultural loans by Federal
Reserve member banks in leading cities have
declined more than $500,000,000 in the la,st three
months.
11This attests the real success and; sincerity
of the program put forth last January by the
American Bankers Association for Voluntary action
on the part of the 15,000 banks to avoid excessive
or inflationary increases in the use of bank
credit,1M he said.

TREASURY DEPARTMENT
Washington
FOR IMMEDIATE RELEASE
Thursday, April 29* 1948.

Press Service
No. S-711

Secretary Snyder today expressed his appreication of
voluntary action by the Nation’s private banks in restraining
inflationary business credits.
The Secretary called attention to a Federal Reserve Board
report shoving that commercial, industrial and agricultural
loans by Federal Reserve member banks in leading cities have
declined more than $ 5 0 0 *0 0 0 ,0 0 0 in the last three months.
"This attests the real success and sincerity of thQ.program
put forth last January by the American Bankers Association for
'voluntary action on the part of the 15,000 banks to avoid
excessive or inflationary increases in the use of bank credit,'”
he said.
The Secretary said the banks had given a "cheering response”
to President Truman’s appeal for restraint of inflationary
credit,
Secretary Snyder said that, "In view of the continuing
inflationary pressures, it is important that the banks keep up
their splendid work.”
oOo

-

40

-

and insidious threat not alone to the
European nations, but to our whole
democratic concept.

However,

l believe

that wide recognition of this fact and
the determination to use our knowledge
and ability to work together for peace
and security will prove our greatest
safeguard.

There is no force of

sufficient strength to deter an

America

united in its goal of world peace and
economic stability.

?/

39

V-

WË

strong lever In the promotion of our
foreign policy objectives.
President Truman*s foreign policy
V

has been dedicated,

11

first and foremost,

to the establishment and preservation of
..e

1 •

a

\

,

",

,

IS? ^V-fS »■

pfi

V

the peace.

‘
V

I

This Adm ini strat ion is

exerting every influence and devoting
■Ü \K !1 i

fsmm
mSMm

every possible means to minimize those
underlying causes *h ich continue to
'‘

•¿fv‘.; ,*”
if

1 ; 1 r:-è- Ss:: :

; .

'■if

breed «orId dissension and strife.
For the ever aggressive power of
totalitarian force has become a vicious

^

_________•________ ■

^

; ,v - r ; u,, _________

obligations that confront them.

What

they are seeKing now is time to
accomplish these taSKS, for they cannot
be accomplished overnight.
We have in these last months
ISSSS

witnessed a growing degree of
cooperation between the free peoples
of the Western European countries and
of the Western Hemisphere.

The

European Recovery BiI I has been an
effective instrument in furthering this
cooperation, and wiI I continue to be a

37 -

| ( ¡¡I

secure the recovery and stability we all
see«.

The European part ic Ipat ing

countries face a prodigious tasK and
sooner or later, must stand on their
own feet.

These countries themselves

must produce most of the goods which
they consume.

They must achieve a

level of production where, by their
own efforts, they can pay for what they
import by exporting goods and services.
— -The European countries are fully
aware of the tremendous tasxs and

-

3 6

-

7 / ^

the Ir programs of internal recovery,
they have fully cooperated with the
United States-Government and amongst
themselves in improving and clarifying
the original Paris program.

The

continuing organization of the
European countries was put Into
effective operation in Paris two weens
after the recovery bill was enacted.
Let me remind you, however, that
vital as American aid Is to the recovery
•\ of Europe, this aid alone will not

35 -

*?/ V

of cooperative endeavor for the common

he signed the Recovery Bill.
— ■The s ixteen part ic ipat ing
European countries have already
demonstrated their firm determ¡nation
to do their full share of the
formidable job that has tp be done.
This determination is reflected in the

34
reputations of Mr. Hoffman and
Mr. HarrIman as business men and as
American citizens command the respect
and confidence of us all, and with the
cooperation and bacKing of the
American people, we can be certain
of a top notch performance in the
carrying out of these grave
responslbiIi ties*
This, then, in broad outline, is
the great venture in constructive
statesmanship, the outstanding example

~ 33 *■
existing level of rations.
further possible to reduce unempIoyment
and to increase production.
^ — ' You have seen the positive results
in Italy.

Steps have been taxen to put

the internal finances of that country
in better shape.

A rigorous control

of credit has been introduced.

And,

in France, too, considerable progress
has been made toward internal stability.
The adroinistrat ion of the Recovery
Program is in excellent hands.

>

■&$ *

. 31 7 / :V"
Similar discussions are taxing place
among the Scan#inevian countries.
ne should not, of course, attempt
to judge the' European Recovery Program
by the results of the first month of its
operations.

But there are some

recent developments which are of
exceptional

import.

you will recall

that before the Recovery Act became
law. Congress provided funds
Interim aid to ’-ranee,
Austria.

Italy and

This emergency assistance

was needed because of the desperate

countries comprise a great trading and
industrial area.

By uniting the steel

glass, cement and other industries of
Belgium and Luxembourg with the dairy
products, horticulture and colonial
processing of the Netherlands, more
efficient utilization of manpower and
'

- V

.

t

" : ' r

material resources is being obtained.
—

Italy and France are also

intensively examining the necessary
adjustments which must be made prior
to establishment of a customs union.

4r-- In this latter endeavor, the most
advanced effort is that of Belgium, the
Netherlands and Luxembourg, Known as the
Benelux union.

As a result of severe

post-war maladjustments, free flow of
goods within this area is not yet

I

possible.

I

But it is hoped that free

interchange of goods can be accomplished!
within a year or so, thus completing a
long-range project which began in
London during the war years.
Economically speaxing, the Benelux

|

|f ■ '

?/"^
«• 2g -

have moved to shift unemployed labor
across national boundaries to
those countries in need of additional
manpower.

They are acting to make

better use of such resources as
metallurgical coke, mining equipment,
steel and internal transportâtion.
And, they have been further exploring
the possibilities of regional customs
u n ions.

*

Jgj
- 27 ^ —

Tne record made since the Paris

meetings of last summer by the 16
participating countries has been one of
definite progress in mutual cooperation.
These countries have been endeavoring
to work together to promote a more
effective utilization of European

—

• * *

i

‘

European clearing organ izat ion,
designed to avoid unnecessary
transfers of

o r

Iars.

They

European Recovery Program off-shore
procurement authority »ill facilitate
the maintenance of these relationships.
it has been emphasized that the
European Recovery Program is a two-way
program.

The Un itea States provides

assistance, but,

in the words of the

Act, ^continuity of assistance provided
by the United States should, at all
times, be dependent upon continuity
of cooperation among countries
parti c ipat ing in the program...

s i **®*"®*9

■

*

' ^

«* 25 **

V

V

other* Western Hemispheric countries.
Canada and Latin America are heavily
dependent upon the import of certain
types of goods from the United States,
and on our part, we are equally
dependent upon imports from Canada and
the other Western Hemisphere countries
from the long-run viewpoint,

* i

•

it is

clear that these trading relationships
in the Western Hemisphere must be
sustained and encouraged.
— -And it should be noted that the

V

24

V"

oils, meat and other agricultural
products can be procured only in other
countries of the Western Hemisphere.
We can make it possible through these
off-shore purchases for these countries
to supply larger amounts of foods and
materials to Europe and at the same time
maintain necessary imports from the
United States.
For it is of the hi

importance

that we avoid disturbing the flow of

■ ■ ■

essential exports from this country

S i ' tj" v
i

j ' M\iM m $ "

23 -

§

||PfJPll I
s

7

«

M m i,

I^

/^

all the materia Is needed for the Recover
Program in the United States, nor would
it be desirable to attempt to do so.
Some commodities are in short supply
here, and purchasing abroad will
alleviate hardship for our population
and will

in many instances reouce the

net cost of the Program.
For instance, the needed amounts of
food cannot all be obtained in the
United States.

A large percentage of

the requirements of grains, fats and

There are several other financial
aspects of the ERF which should be of
special

interest to you.

One is the

authority given to the Administrator to
expend funds for the procurement of
supplies outside of the United States.
This is the so-called off-shore
procurement authority.

Its primary

purpose is to relieve pressure upon
goods and services in short supply
in the United States.
it will not be possible to obtain

basic criteria for determining the
extent to «filch any country should be
aided on a grant, as opposed to a
credit basis.

First is the character

ana purpose of the assistance.

Second

is the anticipated capacity of the
recipient country to repay.

The

Administrator. in consultation with the
National Advisory Council, will make the
determination of the proportion of
loans ana grants applicable to each
country.

7 / v"

of tne countries, h o w e v e r , will receive
aid partly on a grant basis and partly
on a loan basis.
.....^ —

In uetermining tne division of

aid between grants and loans, we roust
continually bear in roind that the
objective of the Aid Program is to
establish economic stability in Europe.
An important factor that must be
considered is the ability of the
recipient countries to repay.
The Congress has established two

participating countries.
Let me turn now f r o m details of
organization to certain aspects of
basic financial policy.

The aid to

Europe under the Economic Cooperation
Act will be partly in the form of
outright grants and partly in the form
of credits.

Some countries are in a

sound enough position to receive
all of the assistance on a credit
basis.

Other countries will receive

all aid on a grant basis.

• j jpm ÊK 1

- 18 -

the United States Specie I Representative
in Europe,

it will prepare over-all

production,

import, and export programs

on the basis of estimates submitted by

Lj

the member governments.

[

It wi Ii/study

the best use of the labor and productive
capacity of the member countries, and
will promote consultation on such
matters as trade, internationaI payments]
and the movement of labor,

it will also

prepare studies and reports for the
information of the U n ited States and the!

policies.

These nations are acting

individually and jointly to accomplish
internal

improvements.

Their

Organization for Economic Cooperation in
Paris is charged with responsibiIity
for determining matters of policy,
formulating programs of cooperative
action and carrying out additional
functions sucn as the collection of
information and the preparation of
joint programs.

This Organization will

provide information and assistance to

additional members,
appointed by the President

members of the Board are to be
selected from among United States
citizens who nave had broad and varied
experience in matters affecting the

include the adoption of sound

7

their own

/

i II

ion of supplies wnich

make

avai labi e, and will

ill a
ic Advisory Board, which will
required to meet at least once
month

advise and consult with the

Admimstrator on matters of general
policy.

This
♦ #
in

is to consist
%

as cha irman,

“

7/ V"'

14

special iniss Ion attached to each of
our embassies and legations in the
participating countries.

These special

missions will report to the Administrate
“731

in Washington,

and also to the head of

our diplomatic mission in each country
concerned.

In this way there should be

efficient coordination both with our
over-all foreign policy and with the
recovery program as a whole.
— The special missions will study the
measures which the participating

of ail the American activities of this
program in Europe.

This7Spec iaI

Representat ive is Mr. Avereli Harriman,
who will have the rank of Ambassador.
He is responsible for coordinating
the work of the American Administration
witn the work of the continuing
Organization for European Economic
Cooperation which the partic5pating
countries have established in Paris.
"V"—

Ambassador Harriman and his staff

in Paris will have at their service a

12

of tne commodity.
of government

-

Conspicuous
ing wi I I

^ocurement of

ftn n

r

ses

in
a s

i.

«nere aovisaofe, certain

©rials

il De purchased Dy the partie ipati
governments outside the United States
ano,

in these cases, fuñas wi I I be
atea for the purpose
recovery act further provi
lu»

ishment of

an

American

organization in Europe, under
direction of a United
u p e r v is ion

V

•V"

I -

r

suppliers will deal directly with
foreign Buyers.

Some goods will be

bought, however, through government
agencies, although these purchases
probably will be of lesser extent over
tne next year or so than they have been
in the past.

This Government purchasing

will be principally in the case of goods I
wnich are extremely scarce and subject
to export allocations, or where
competitive independent buying might
have serious effects on the market price

i; K- ' -'I-',-

% * Ì;V . - : ' v i ^ . : . V

mini

or,

primarily charged with allocating
funds for the purposes of the program,
and with arranging the procurement of
suppIies.
^ —

Procurement will, so far as is
carri ed

normal channels of private business,
and United States manufacturers and

- 9 a period of months.
The Admin istrator, under the direct
authority of the President,

is

responsible for reviewing and appraising
the requirements of participating
countries, for developing programs of
assistance to meet these requ irements,
and for directing their efficient
execut Jon.
--- The headquarters of the Economic
Cooperation Admini stration is in
Washington, and consists of the offices

jpg
-

a

-

Adm In istrator Hoffman is confronted with
an enormous task In establishing the
machinery to carry out the provisions
of the recovery bill.

However, he

established a skeleton organization at
once in order to get the program
promptly into action.

Ships sailed for

Europe almost immediately with supplies
authorized under the new act.

This

quick action was made possible by the
advance work which had been done by the
executive branch of the Government over I

-rAid program.

f

The assistance that is

being provided is recognized as crucial
to the economic recovery of Western
Europe and to world economic stability.
I believe that we cannot over-emphasize
the importance of that recovery to the
United States.
We have moved speedily.
— Mr. Paul Hoffman was nominated by
the President and confirmed by the
Senate as the Recovery Administrator
within hours after the bill became law.

7
-

6

-

supplies in the Western Hemisphere
By this screening process the
Executive Branch reduced the Paris

I V

estimates to $6.8 billion for the
*>:

Ib-month/period ending June 30,

1849.

The $5.3 billion which Congress approved
for the twelve-month period ending
March 30,

1949, corresponds to this
18

estimate.

AI though the Recovery Act also
authorizes assistance to China,

i wish

to confine my remarks today to the
Western European phases of the

V-"

5 -

if

seesap Ii shed.
The Foreign Assistance Act of 1948
authorizes $5.3 billion for recovery for
the tweIve-montn period ending next
April.

This particular figure was

determined after consideration of
the minimum recovery needs which
were estimated by the 18 Western Europeai
countries at their meeting in Paris last
summer.

Our Government carefully

examined tnis appraisal of European
needs in the light of available

The recovery btii

itself clearly

describes the issue in these wordsî
"The existing situation in Europe
endangers the establishment of a
lasting peace, the general weI fare and
fpf- .

national

interest of the United States,

ana the attainment of the objectives of
the United Nations."
I think it is essential to
understand clearly the actual working
administration of the program and some
results which are expected to be

JI

1

3
passed this legislation is a vigorous
■

■

demonstration of the operation of
§ L ^ Amer ican bipartisan foreign policy.
You are well aware of the
world-wide conditions which necessitated
the recovery program.

They have been

described in great detail
newspapers,

in the

in the magazines, on the

radio and in Congress 1onaI debate.

Few

matters of state nave been the subject
of such widespread public discussion
among our citizens.

i

7i
i

a

i

economic reconstruct ion, and toward
preserving tne peace.

Especially is

the European Recovery Program an
outstanding example of united ana
practical effort for tne common good.
The support which the foreign aid
legislation received from the great
majority of the American people is
singular evidence of our ability and
capacity to meet a critical situation
with effective action.

Certainly,

the promptness with wnicn the Congress

* «

5

2 1

' O i| ’

. V'*- -

✓

tC O

S t a t e s

through U s foreign aid policy, has
instituted a program unparalleled in
in an effort to

wor Id

confidence, courage, and security,
lT-r:

fie

•

have taken a positive and unprecedented
step in constructive
which should be most reassuring to
people of war-devastated and
threatened countries
initiated s

have

measur es

establishment of cooperation in

MISSOURI BANKERS ASSOCIATION
May 4, 1948

•OUR FOREIGN AID POLICY IN OPERATION*

TREASURY DEPARTMENT
Washington
(The f o l l o w i n g address by S e c r e t a r y S n y d e r b e fore the
19^ 8 C o n v e n t i o n of the M i s s o u r i B a n k e r s A s s o c i a t i o n ,
at the J e f f e r s o n Hotel, St. Louis, M i s s ouri, is
s c h e d u l e d f or d e l i v e r y at 11:15 a,m. Central D a y l i g h t
S a v i n g T i m e , T u e s d a y , M a y 4, 1948., 'and is" ’for release
aH ' t h a t tinieTT------------ --------- --------------

’’OUR F O R E I G N A I D P O L I C Y IN O P E R A T I O N "
T he U n i t e d States Government, t h r o u g h its f o r e i g n aid
policy, h as i n s t i t u t e d a p r o g r a m u n p a r a l l e l e d in h i s t o r y in an
effort to rec r e a t e w o r l d confidence, c o u r a g e | and security.
We h a v e t a k e n a p o s i t i v e and u n p r e c e d e n t e d step in c o n s t r u c t i v e
s t a t e s m a n s h i p w h i c h should be m o s t r e a s s u r i n g to p e o p l e of ward e v a s t a t e d and w a r - t h r e a t e n e d c o u n t r i e s , Wei h a v e i n i t i a t e d
s t r o n g m e a s u r e s toward the e s t a b l i s h m e n t of /coopérâti o n in
e c o n o m i c reconstruction., and toward p r e s e r v i n g the peace.
E s p e c i a l l y is the E u r o p e a n R e c o v e r y Program* a n o u t s t a n d i n g
example of U n i t e d and p r a c t i c a l effort for the c o m m o n good.
The support w h i c h the f o r e i g n aid l e g i s l a t i o n r e c e i v e d
f r o m the great m a j o r i t y of the A m e r i c a n p e o p l e is s i n g u l a r e v i ­
dence of our a b i l i t y and cap a c i t y to m e e t a c r i t i c a l s i t u a t i o n
w i t h e f f e c t i v e action.
Certainly, the p r o m p t n e s s w i t h w h i c h
the Con g r e s s p a s s e d this l e g i s l a t i o n is a v i g o r o u s d e m o n s t r a t i o n
of the o p e r a t i o n of A m e r i c a n b i p a r t i s a n f o r e i g n policy.
Y o u are w e l l aware of the w o r l d - w i d e con d i t i o n s w h i c h
n e c e s s i t a t e d the r e c o v e r y program.
They have been described
in great d e t a i l in the newspapers, in the m a g a z i n e s , on the
radio a nd in C o n g r e s s i o n a l debate.
F e w m a t t e r s of state h ave
been the subject of suc h w i d e s p r e a d p u b l i c d i s c u s s i o n a m o n g our
citizens.
The r e c o v e r y bil l I t self c l e arly d e s c r i b e s the issue
In these words:
"The e x i s t i n g s i t u a t i o n in E u r o p e endangers
the e s t a b l i s h m e n t of a l a s t i n g peace, the g e n e r a l w e l f a r e and
n a t i o n a l in t e r e s t of the U n i t e d States, and the a t t a i n m e n t of
the o b j e c t i v e s of the U n i t e d N a t i o n s , "
Ï t h i n k it is- e s s e n t i a l to u n d e r s t a n d c l e a r l y the a c tual
w o r k i n g a d m i n i s t r a t i o n of the p r o g r a m and some results w h i c h
are e x p e c t e d to be accom p l i s h e d .
Th e F o r e i g n A s s i s t a n c e A c t of 1948 a u t h o r i z e s $ 5 , 3 b i l l i o n
for r e c o v e r y for the t w e l v e - m o n t h p e r i o d e n d i n g n e x t April,
This p a r t i c u l a r figure was d e t e r m i n e d a f t e r c o n s i d e r a t i o n of
the m i n i m u m r e c o v e r y needs w h i c h wer e e s t i m a t e d by the 1 6
W e s t e r n E u r o p e a n countries at t h e i r m e e t i n g in Paris last s u m ­
mer,
O u r G o v e r n m e n t c a r e f u l l y e x a m i n e d this a p p r a i s a l of
E u r o p e a n n e eds in the light of a v a i l a b l e supplies in the W e s t e r n
Hemisphere.
B y this s c r e e n i n g p r o cess the E x e c u t i v e B r a n c h
E d u c e d the Paris e s t imates to $ 6 , 8 b i l l i o n for thé 1 5 - m o n t h
S-712

2
p e r i o d e n d i n g J u n e 30* 19^9*
The $ 5 * 3 "billion 'Which Congress
a p p r o v e d for the t w e l v e - m o n t h p e r i o d e n d i n g M a r c h 30, 19^9,
corresponds to this estimate.
A l t h o u g h the R e c o v e r y A c t also a u t h o r i z e s a s s i s t a n c e to
China, I w i s h to confine m y re r m r k s t o d a y to the W e s t e r n
E u r o p e a n phases of the A i d p r o gram.
The a s s i s t a n c e that is
"being p r o v i d e d is r e c o g n i z e d as crucial to the eco n o m i c r e c o v e r y
of W e s t e r n E u r o p e and to w o r l d e c o n o m i c stability.
I believe
that we cannot o v e r - e m p h a s i z e the i m p o r t a n c e of that r e c o v e r y
to the U n i t e d States.
W e h a v e m o v e d speedily,
Mr. P aul Hoffmann w a s n o m i n a t e d - b y
the P r e s i d e n t and c o n f irmed by the S e nate as the R e c o v e r y A d ­
m i n i s t r a t o r w i t h i n h o u r s a f ter the bill b e c a m e law, A d m i n i s t r a t o r
H o f f m a n is c o n f r o n t e d w i t h an enormous t a s k in e s t a b l i s h i n g the
m a c h i n e r y to c a rry out the p r o v i s i o n s of the r e c o v e r y bill.
However, h e e s t a b l i s h e d a s k e l e t o n o r g a n i z a t i o n at once in o r d e r
to get the p r o g r a m p r o m p t l y into action.
Ships s a iled for
Europe almo s t i m m e d i a t e l y w i t h supplies a u t h o r i s e d u n d e r the n e w
a c t . This q u i c k a c t i o n was m a d e p o s s i b l e b y the a d v a n c e w o r k
w h i c h h a d b e e n done by the e x e c u t i v e b r a n c h of the G o v e r n m e n t
over a p e r i o d of m o n t h s .
The A d m i n i s t r a t o r , u n d e r the d i r e c t a u t h o r i t y of the
President, is r e s p o n s i b l e f or r e v i e w i n g and a p p r a i s i n g the
requi r e m e n t s of p a r t i c i p a t i n g countries, fo r d e v e l o p i n g p r o g r a m s
of a s s i s t a n c e to m e e t these r e q u i r e m e n t s ■
> and f or d i r e c t i n g
their e f f i c i e n t e x e c ution.
The h e a d q u a r t e r s of the E c o n o m i c
C o o p e r a t i o n A d m i n i s t r a t i o n is in W a s h i n g t o n , and co n s i s t s of the
offices vof the A d m i n i s t r a t o r , the D e p u t y A d m i n i s t r a t o r , and the
n e c e s s a r y o p e r a t i n g staff.
This h e a d q u a r t e r s w i l l be p r i m a r i l y
charged w i t h a l l o c a t i n g funds f o r the p u r p o s e s of the program,
and w i t h a r r a n g i n g the p r o c u r e m e n t of supplies.
Procurement
will, so far as is p r a c t icable, be carried out t h r o u g h n o r m a l
channels of p r i v a t e business, and U n i t e d States m a n u f a c t u r e r s
and suppliers w i l l d eal d i r e c t l y w i t h f o r e i g n buyers,
Some goods
will be bought, however, t h r o u g h g o v e r n m e n t agencies, a l t h o u g h
these p u r c h a s e s p r o b a b l y w i l l be of l e s s e r extent ove r the n e x t
year or so t h a n the y h a v e b e e n in the past.
This g o v e r n m e n t
p u r c h a s i n g w i l l be p r i n c i p a l l y in.the case of goods w h i c h are
extremely scarce and subject to export a llocations, or where:
competitive i n d e p e n d e n t b u y i n g m i g h t h a v e serious effects on the
market p r i c e of the commodity,
C o n s p i c u o u s cases of gov e r n m e n t
buying w i l l be in the p r o c u r e m e n t of w h e a t and coal,
Where
~
advisable, c e r t a i n m a t e r i a l s w i l l be p u r c h a s e d by the p a r t i c i ­
p a ting g o v e r n m e n t s o u t side the U n i t e d States and, in these cases,
funds w i l l be a l l o c a t e d for the purpose*
The r e c o v e r y act f u r t h e r p r o v i d e s for the e s t a b l i s h m e n t of
an A m e r i c a n o r g a n i z a t i o n in Europe, u n d e r the d i r e c t i o n of q,
Unit e d States Sp e c i a l R e p r e s e n t a t i v e , fo r the s u p e r v i s i o n of
all the A m e r i c a n a c t i v i t i e s of this p r o g r a m in E u r o p e .
This

- 3 S p e c i a l R e p r e s e n t a t i v e is Mr, A v e r e l l H a r r i m a n , w ho w i l l hav e
the r a n k of A m b a s s a d o r .
He is r e s p o n s i b l e for c o o r d i n a t i n g
the w o r k of the A m e r i c a n A d m i n i s t r a t i o n w i t h the w o r k of the^
c o n t i n u i n g O r g a n i z a t i o n for E u r o p e a n E c o n o m i c C o o p e r a t i o n w h i c h
the p a r t i c i p a t i n g countries h a v e e s t a b l i s h e d in Paris,
A m b a s s a d o r H a r r i m a n and his staff in P a ris w i l l h a v e at their
service a special m i s s i o n a t t a c h e d to eac h of our e m b a ssies
and l e g ations in the p a r t i c i p a t i n g c o u n t r i e s , T h ese special
m i s s i o n s w i l l report to the A d m i n i s t r a t o r in W a s h i n g t o n , and
also to the h e a d of our d i p l o m a t i c m i s s i o n in e a c h c o u n t r y c o n ­
cerned,
In this w a y there should be e f f i c i e n t c o o r d i n a t i o n
b o t h w i t h our o v e r-all f o r e i g n p o l i c y and w i t h the r e c o v e r y
p r o g r a m as a whole.
The special m i s s i o n s w i l l s t udy the m e a s u r e s
w h i c h the p a r t i c i p a t i n g countries are t a k i n g to b r i n g about
t h e i r ow n recovery, w i l l observe the d i s t r i b u t i o n of supplies
w h i c h we mak e available, and w i l l report in d e t a i l on the p r o g r e s s
of the program.
The R e c o v e r y B i l l also creates a P u blic A d v i s o r y Board, r
w h i c h w i l l be r e q u i r e d to m e e t at least once e a c h m o n t h to adv i s e and consult w i t h the A d m i n i s t r a t o r on m a t t e r s o f g e n eral
policy.
This B o a r d Is to consist of the A d m i n i s t r a t o r , as
chairman, and twelve a d d i t i o n a l members, who w i l l be a p p o i n t e d
b y the P r e sident w i t h the app r o v a l of the Senate,
The twelve
m e m b e r s of the B o a r d are to be s e l ected f r o m a m o n g U n i t e d States
citizens w h o h a v e h a d broad and v a ried e x p e r i e n c e in m a t t e r s
a f f e c t i n g the p u b l i c i n t e r e s t ,
The sel f - h e l p m e a s u r e s of the p a r t i c i p a t i n g countries w h i c h
are a s t i p u l a t i o n of the f o r e i g n aid program, include the
a d o p t i o n of sound d o m e s t i c pol i c i e s .
These n a t i o n s are a c t i n g
i n d i v i d u a l l y and jointly to a c c o m p l i s h i n t ernal i m p r o vements.
T h e i r O r g a n i z a t i o n for E c o n o m i c C o o p e r a t i o n in Paris is c h arged
w i t h r e s p o n s i b i l i t y for d e t e r m i n i n g m a t t e r s of policy, f o r m u l a ­
ting p r o g r a m s of coop e r a t i v e a c t i o n and c a r r y i n g out a d d i t i o n a l
functions such as the c o l l e c t i o n of i n f o r m a t i o n and the p r e p a r a ­
t i o n of joint p r o g rams.
This O r g a n i s a t i o n w i l l p r o v i d e
i n f o r m a t i o n and a s s i s t a n c e to the U n i t e d S t ates S p e c i a l R e p r e ­
s e n t a t i v e in E u r o p e .
It w i l l p r e p a r e o v e r - a l l p r o d uction,
import, and export p r o grams on the basis of e s t i m a t e s s u b m itted
b y the m e m b e r g o v e r n m e n t s . It w i l l study the bes t use of the
labor a nd p r o d u c t i v e cap a c i t y of the m e m b e r countries, and w i l l
p r o m o t e c o n s u l t a t i o n on such m a t t e r s as trade, i n t e r n a t i o n a l
payments, a nd the m o v e m e n t of labor,.
It w i l l also p r e p a r e
studies and reports for the i n f o r m a t i o n of the U n i t e d States
and the p a r t i c i p a t i n g c o u n t r i e s .
L et me t u r n n o w f r o m details of o r g a n i z a t i o n to c e r t a i n
aspects of b a sic fin a n c i a l policy.
The aid to E u r o p e u n d e r the
E c o n o m i c C o o p e r a t i o n A c t w i l l be p a r t l y in the f o r m of o u t right
grants and p a r t l y In the f o r m of credits.
Some c o u n tries are
in a sound e n o u g h p o s i t i o n to r e ceive all of the a s s i s t a n c e on
a credit basis.
O t her countries w i l l r e c e i v e all aid on a
g r a n t b a s i s . : M o s t of the c o u n t r i e s h o w e v e r , w i l l r e ceive aid
p a r t l y on a grant basis and p a r t l y ' o n a l o a n basis.
In

A

•

- b - .
d e t e r m i n i n g the d i v i s i o n of aid b e t w e e n grants and loans, we
m u s t c o n t i n u a l l y b e a r in m i n d that the o b j e c t i v e of tile A i d
P r o g r a m is to e s t a b l i s h econo m i c s t a b i l i t y in E u r o p e . A n
im p o r t a n t f a c t o r that m u s t be c o n s i d e r e d is the a b i l i t y of
the r e c i p i e n t countries to repay.
The C o n gress h as e s t a b l i s h e d
two b a sic c r i t e r i a for d e t e r m i n i n g the e x t e n t to w h i c h a ny
c o u n t r y s h o u l d be a i ded o n a grant, as o p p o s e d to a credit
basis,
F i r s t is the c h a r a c t e r and p u r p o s e of the a s s i s t a n c e .
S e c o n d is the a n t i c i p a t e d c a p a c i t y of the r e c i p i e n t c o u n t r y to
rebay.
The A d m i n i s t r a t o r , in c o n s u l t a t i o n w i t h the National.
A d v i s o r y Council, w i l l m a k e the d e t e r m i n a t i o n of the p r o p o r t i o n
of loans and grants a p p l i c a b l e to e a c h c o u n t r y .
T h e r e are several o t h e r f i n a n c i a l as p e c t s of the E R P w h i c h
should be of s p ecial inter e s t to you.
One is the a u t h o r i t y
g i v e n to the A d m i n i s t r a t o r to e x p e n d f u nds for the p r o c u r e m e n t
of supplies outside of the U n i t e d States,; This is the s o - c a l l e d
o f f - s h o r e p r o c u r e m e n t a u t h ority.
Its p r i m a r y p u r p o s e is to
r e l ieve p r e s s u r e u p o n goods and services in short s u p p l y in
the U n i t e d States.
It w i l l not be p o s s i b l e to o b t a i n all. the
m a t e r i a l s n e e d e d for the R e c o v e r y P r o g r a m I n the U n i t e d States,
n o r w o u l d It be d e s i r a b l e to a t t empt to do so.
Some c o m m odities
are in short supply here, and p u r c h a s i n g a b r o a d w i l l a l l e v i a t e
h a r d s h i p for our p o p u l a t i o n and w i l l in m a n y i n s tances reduce
the n e t cost of the P r o g r a m .
F o r instance, the n e e d e d amounts
of food cannot a l l be o b t a i n e d In the U n i t e d States,
A large
p e r c e n t a g e of the r e q u i r e m e n t s of grains, fats and oils, m e a t
and o t her a g r i c u l t u r a l pr o d u c t s can be p r o c u r e d onl y in o t her
countries of the W e s t e r n Hemisphere... W e can m a k e it p o s s i b l e
t h r o u g h these o f f - s h o r e p u r c h a s e s for these c o u n tries to s u pply
l a rger amounts of foods and m a t e r i a l s to E u r o p e an d at the same
time m a i n t a i n n e c e s s a r y imports f r o m the U n i t e d S t a t e s , F o r it
i s of the h i g h e s t i m p o rtance that we a v o i d d i s t u r b i n g the f l o w
of e s s e n t i a l e x p o r t s * f r o m this c o u n t r y to o t her W e s t e r n
H e m i s p h e r i c countries.
C a nada and L a t i n A m e r i c a are h e a v i l y
d e p e n d e n t u p o n the Import of c e r t a i n types of goods f r o m the
U n i t e d States, a n d . o n our part, we are e q u a l l y ' d e p e n d e n t u p o n
imports f r o m C a n a d a and the other W e s t e r n H e m i s p h e r e c o u n t r i e s «
F r o m the l o n g - r u n viewpoint, It Is clear that these t r a d i n g
r e l a t i o n s h i p s In the W e s t e r n H e m i s p h e r e m u s t be s u s t a i n e d and
e n c o u r a g e d , A n d it should be n o t e d that the
European Recovery
P r o g r a m o f f - s h o r e p r o c u r e m e n t a u t h o r i t y w i l l f a c i l i t a t e the
m a i n t e n a n c e of these r e l a t i o n s h i p s .
It h a s b e e n e m p h a s i z e d that the E u r o p e a n R e c o v e r y P r o g r a m
is a t w o - w a y p r o g r a m .
The U n i t e d Stat e s p r o v i d e s assistance,
but, in the w o r d s of the Act, '’c o n t i n u i t y of a s s i s t a n c e p r o ­
v i d e d b y the U n i t e d States should,, at all times, be d e p e n d e n t
u p o n c o n t i n u i t y of c o o p e r a t i o n a m o n g countries p a r t i c i p a t i n g
in the p r o g r a m . . . ” . The r e c o r d m a d e since the Paris m e e t i n g s
of last summer b y the 1 6 p a r t i c i p a t i n g countries h as b e e n one
of d e f i n i t e p r o g r e s s in m u t u a l c o o p e r a t i o n .
T h e s e countries
h a v e b e e n e n d e a v o r i n g to w o r k t o g e t h e r to p r o m o t e a m o r e
e f f e ctive u t i l i z a t i o n of E u r o p e a n r e s o u r c e s .
T h e y h a v e set up

5
a E u r o p e a n c l e a r i n g organization, d e s i g n e d to a v o i d u n n e c e s s a r y
transfers of gold or dollars.
T h e y h a v e m o v e d to shift
u n e m p l o y e d l a b o r across n a t i o n a l b o u n d a r i e s to those countries
in n e e d of a d d i t i o n a l manpower.. T h e y are a c t i n g to m a k e
b e t t e r use of such r e s ources as m e t a l l u r g i c a l coke, m i n i n g
equipment, steel and i n t ernal t r a n s p o r t a t i o n .
And, t h e y h a v e
b e e n f u r t h e r e x p l o r i n g the p o s s i b i l i t i e s of r e g i o n a l customs
unions.
In this l a tter endeavor,, the m o s t a d v a n c e d .e f fort is
that of Belgi u m , the N e t h e r l a n d s and L u x e m b o u r g , k n o w n as the
Benelux union.
A s a r e sult of s e vere p o s t - w a r m a l a d j u s t m e n t s ,
free f l o w o f goods w i t h i n this a r e a is no t y e t p o s s i b l e .
But
It Is h o p e d that free i n t e r c h a n g e of goods ca n be a c c o m p l i s h e d
w i t h i n a y e a r or so, thus c o m p l e t i n g a l o n g - r a n g e p r o j e c t
w h i c h b e g a n In L o n d o n d u r i n g the w a r years.
Economically
speaking,- the B e n e l u x countries c o m prise a great t r a d i n g and
i n d u s t r i a l area.
B y u n i t i n g the steel, glass, cement an d other
i n d u s t r i e s of B e l g i u m and L u x e m b o u r g w i t h the d a i r y products,
h o r t i c u l t u r e and colonial p r o c e s s i n g of the N e t h e r l a n d s , m ore
e f f i c i e n t u t i l i z a t i o n of m a n p o w e r and m a t e r i a l r e s o u r c e s is
b e i n g obtained,
Italy and F r a n c e are also i n t e n s i v e l y e x a m i n i n g
the n e c e s s a r y a d j u s t m e n t s w h i c h m u s t be m a d e p r i o r to e s t a b l i s h ­
m e n t of a customs unio n .
S i m i l a r d i s c u s s i o n s are t a k i n g p l ace
a m o n g the S c a n d i n a v i a n c o u n t r i e s .
W e should not, of course, at t e m p t to judge the E u r o p e a n
R e c o v e r y P r o g r a m by the results of the first m o n t h of Its
oper a t i o n s .
B u t there are some r e cent d e v e l o p m e n t s w h i c h are
of e x c e p t i o n a l import.
Y o u w i l l r e call that b e f o r e the R e c o v e r y
A c t b e c a m e laV, Congr e s s p r o v i d e d funds for i n t e r i m a id to.
France, I t a l y and Aus t r i a .
This e m e r g e n c y a s s i s t a n c e was n e e d e d
b e c ause of the d e s p e r a t e s i t u a t i o n of these c o u n t r i e s , W e h a v e
b e e n able to f u r n i s h e s s e n t i a l supplies to t h e s e countries, and
we can n o w b e g i n to see the effects.
W i t h o u t the e m e r g e n c y
supplies of ra w m a t e r i a l s and foo d s t u f f s w i t h w h i c h t h e y w ere
provided, these countries w o u l d h a v e a p p r o a c h e d a state of
compl e t e collapse d u r i n g the w i n t e r .
The supplies e n a b l e d the m
to kee p t h e i r I n d u s t r i a l m a c h i n e going, and h a v e p e r m i t t e d the
c o n t i n u a n c e of a p p r o x i m a t e l y the e x i s t i n g level of rations.
It has b e e n f u r ther p o s s i b l e to r e d u c e u n e m p l o y m e n t and t©
Incre a s e p r o d u c t i o n .
Y o u h a v e s e e n the p o s i t i v e results in
I t aly,
Steps h a v e b e e n t a k e n to p ut the I n t e r n a l finan c e s of
that c o u n t r y In b e t t e r s h a p e . A rigorous c o n trol o f credit has
b e e n i ntroduced.
And, In France, too, c o n s i d e r a b l e p r o g r e s s
has b e e n m a d e t o ward i n t e r n a l s t a b i l i t y .
The a d m i n i s t r a t i o n of the R e c o v e r y P r o g r a m is I n e x c e l l e n t
hands . The r e p u tations of M r , H o f f m a n and M r . H a r r i m a n as
b u s i n e s s m e n a nd as A m e r i c a n citizens c o m m a n d the r e s pect and
c onfidence of us all, and w i t h the c o o p e r a t i o n a nd b a c k i n g of
the A m e r i c a n people, we can be c e r t a i n of a top n o t c h p e r f o r m ­
ance in the c a r r y i n g out of these grave r e s p o n s i b i l i t i e s .

This, then, in b r o a d outline, is the great ve n t u r e in
c o n s t r u c t i v e statesmanship, the o u t s t a n d i n g e x a m p l e of c o o p e r a ­
tive e n d e a v o r for the c o mmon good, of w h i c h the P r e s i d e n t
spoke w h e n he signed the R e c o v e r y Bill,
The s i x t e e n p a r t i ­
c i p a t i n g E u r o p e a n countries h a v e a l r e a d y d e m o n s t r a t e d t h eir
f i r m d e t e r m i n a t i o n to d o ‘t h e i r full share of the f o r m i d a b l e
job that h as to be done.
This d e t e r m i n a t i o n is r e f l e c t e d in
the p r o m p t n e s s w i t h w h i c h they t o o k a c t i o n at the Paris C o n f e r ­
ence of last summer.
A n d since then, w h i l e p r o c e e d i n g w i t h
their p r o g r a m s of in t e r n a l recovery, they h a v e f u l l y c o o p e r a t e d
w i t h the U n i t e d States G o v e r n m e n t and a m o n g s t t h e m selves in
i m p r o v i n g and c l a r i f y i n g the o r i g i n a l Paris pro g r a m .
The c o n ­
t i n u i n g o r g a n i z a t i o n of the E u r o p e a n c o u n tries was put into
eff e c t i v e o p e r a t i o n in Paris two w e e k s a f t e r t h e r e c o v e r y bil l
was enacted,
Let me r e m i n d you, however, that v i tal as A m e r i c a n aid is
to the r e c o v e r y of Europe, this aid alone w i l l n ot secure the
r e c o v e r y and s t a b i l i t y we all seek.
The European, participating,
countries face a p r o d i g i o u s t a s k (and s o oner or later, m u s t
stand on their own feet.
T h ese countries t h e m s e l v e s m u s t p r o ­
duce m o s t of the goods w h i c h they consume.
T hey m u s t ac h i e v e
a level of p r o d u c t i o n where, by their o wn efforts, they c an p a y
for w h a t they import by e x p o r t i n g goods and services.
The
E u r o p e a n countries are f u l l y aware of the t r e m e n d o u s tasks and
o b l i g a t i o n s that confront them.
W h a t they are s e e k i n g n o w is
time to a c c o m p l i s h these tasks, for t hey cannot be a c c o m p l i s h e d
overnight.
We h a v e in these last mont h s w i t n e s s e d a g r o w i n g degr e e
of c o o p e r a t i o n b e t w e e n the free p e o ples of the W e s t e r n E u r o p e a n
c o u ntries and of the W e s t e r n H e m i s p h e r e . The E u r o p e a n R e c o v e r y
B i l l has b e e n a n eff e c t i v e instrument in f u r t h e r i n g this
cooperation, and w i l l continue to be a s t rong l e v e r in the
p r o m o t i o n of our f o r e i g n p o l i c y o bjectives.
P r e s i d e n t T r u man's f o r e i g n p o l i c y has b e e n dedicated, first
and foremost, to the e s t a b l i s h m e n t and p r e s e r v a t i o n of the
peace . This A d m i n i s t r a t i o n is e x e r t i n g e v e r y i n f l u e n c e and
d e v o t i n g e v ery p o s s i b l e m e ans to m i n i m i z e those u n d e r l y i n g
causes w h i c h continue to b r e e d w o r l d d i s s e n s i o n and strife.
F o r the ever a g g r e s s i v e p o w e r of t o t a l i t a r i a n force h as b e come
a v i c i o u s and insidious threat not alone to the E u r o p e a n nations,
but to o ur w h o l e d e m o c r a t i c concept.
Ho w e v e r , X b e l i e v e that
wid e r e c o g n i t i o n of this fact and the d e t e r m i n a t i o n to use our
.knowledge, and a b i l i t y to w o r k t o g e t h e r for p e a c e and s e c u r i t y
w i l l p r o v e our greatest safeguard.
T h e r e is no f o r c e . o f
s u f f i c i e n t s t r e n g t h to d e t e r Ian A m e r i c a u n i t e d in its goal of
w o r l d p e a c e and e c o nomic stability.

ERP procurement will be handled through the following offices:
AUSTRIA

The Minister of Austria (Dr.
Legation of Austria
1706 Twenty-first Street
Washington, D. C.

Ludwig Kleinwaechter)

BELGIUM-LUXEMBQURG
and Belgian
Dependencies

H* E. The Belgian Ambassador
Belgian Embassy
1715 Twenty—second Street
Washington, D. C.

(Baron Silvercruys)

DENMARK

H. E. The Ambassador of Denmark (Henrik de Kauffmann)
Embassy of Denmark
2374 Massachusetts Avenue
Washington, D. C*

FRANCE
and French
Dependencies

H. E. The French Ambassador (Henri Sonnet)
Embassy of the French Republic
2535 Belmont Road
Washington, D, C*

GREECE

H. E* The Ambassador of Greece (Vassili C# Dendramis)
Embassy ©f Greece
2221 Mass achusetts Avenue
Washington, D. C*

ICELAND

-

The Minister of Iceland
Legation of Iceland
909 Sixteenth Street
Washington, D. C.

(Mr. Thor Thors)

IRELAND

The Minister of Ireland
Legation of Ireland
2310 Tracy Place
Washington, D* C»

'(Mr. Sean Hunan)

ITALI

H-. E. The Italian Ambassador (Signor Alberto
Italian Embassy
Tarchiani)
1601 Fuller Street
Washington, D* C.

- 8 netheriah ds

and Netherlands
Dependencies

K. E. The Ambassador of the Netherlands
(Mr# E* N. van Kieffens)
Embassy of the Netherlands
1470 Euclid Street
Washington, D *.C #

NORWAY

H # E The Norwegian Ambassador
Embassy of Norway
3401 Massachusetts Avenue .
Washington^ D, C*

POWn/GAL

H. E* The Portuguese Ambassador
Embassy of Portugal
2125 Kalorama Road
Washington, D* C.

and Portuguese
Dependencies

(Mr* ”ilhelm Muntne
de Morgenstierne)

(Senhor Pedro
Theotonio Pereira)

SIEDEN .

H* E* The Swedish Ambassador
Embassy of Sweden
1900 Twenty-fourth Street
Washington, D* C 0

•(Mr* Herman Eriksson)

SWITZERLAND

The Minister of Switzerland
legation of Switzerland
2900 Cathedral Avenue
Washington, D* C#

(Mr, Charles Bruggmann)

TÜRKEI

H* E* The Turkish Ambassador
(Mr.* Huseyin Ragip Baydur)
Embassy of the Turkish Republic
1606 Twenty— third Street
Washington, D, C #

UNITED KINGDOM

H* E* The British Ambassador
British Embassy
3100 Massachusetts' Avenue
Washington, D* C*

and United
Kingdom
Dependencies

NESTERN GERMAN!

(Lord Inverchapel)

Civil Affairs Division
•Special Staff, United States Army
Pentagon Building
Washington, D, C,

TREASURY DEPARTMENT
WASHINGTON, D .C .

Information Service

Release
TC-1

THE

T R E A S U R Y

C A L E N D A R

Scheduled Departmental Activities
WEEK
M Y »■3-8, 1948
.„I IOF ,

OFFICE OF THE SECRETARY
Monday, May 3 , St. Louis, Me*,
8:50 P.M* 'Secretary Snyder
addressed civic banquet marking
the centennial of the
Chris tian.Bro the rs *.y ..
9:30, P.M., Secretary
interviewed on progress of
the Security Loan Drive,
Station KSD-TV.
Tuesday, May 4, St. Louis, Mo*,
9:30 A.M. Press Conference at
the Jefferson Hotel ... 10:45,
address by Canadian Finance Min­
ister Douglas Abbott, followed b?
Secretary Snyder’s address on
u0ur Foreign Policy in
Operations”, at annual conven­
tion of the Missouri Bankers
Association, Jefferson Hotel,,.
2:30 P.M», Secretary delivered
"off-the-cuff” remarks at mock
political convention conducted
by the students of Washington
University.
Wednesday, May 5, 11 A*M.
Regular weekly press conference
in office of the Secretary.
Thursday, May 6 , 10 A»M.
(Tentative) Secretary appears
before the Senate Appropria­
tions Committee on European
Recovery Program.,.2;30 P*M»,
National Advisory Council
Meeting, Treasury Conference
Room* •

OFFICE OF THE FISCAL ASSISTANT
SECRETARY
Monday through Friday, May 3-7.
Fiscal Agency Conference,
New Ocean House, Swampscott,
Massachusetts ¿- Attending from
the*Treasury: Fiscal Assistant
Secretary E. F, Bartelt,
Commissioner of the Debt
E. L. Kilby, Edward F* Batchelder,
Gilbert Li Cake, M. E. Slindee
and others;

COMPTROLLER OF THE CURRENCY

Thursday, May 6 , Speech by
J, L. Robertson, Deputy Comptroller
of the Currency, before the
Eleventh Mid-Continent Regional
Conference, National Association
of Bank Auditors and Comptrollers,
Baker Hotel, Dallas, Texas.
Subject: ’’Banking Practices.”

BUREAU OF FEDERAL SUPPLY
BUREAU OF THE MINT

Wednesday-Thursday, May 5-6.
Meeting of Member Bodies and
Standards Council,

American Standards Association*
Hotel Commodore, New York City,
Willis S, MacLeod, Deputy
Director of the Standards Branch,
Bureau of Federal Supply,
attending. Will deliver report
for the Committee on Procedures,

Thursday, May 6. Nellie Tayloe
Ross, Director, in Albany,
New York, to serve as judge of
national oratorical contest on
"Ben Franklin, Patriot and
Statesmen", sponsored by Hearst
newspapers.

Saturday, May 8 . Speech by
Clifton E. Mack, Director,
before Annual Convention of the
National Association of
Educational Buyers, Deshler-,
Wallick Hotel, Columbus, Ohio,
Subject: "The Philosophy of
Public Purchasing." (Copies
of speech available Wednesday
Noon, in Room 7312, Bureau of
Federal Supply.)

Saturday, May 8 , 12 Noon* Talk
by Dr, F, Leland Howard, Assistant
Director, before the Joint
Regional Meeting of the National
Automatic Merchandising
Association, Mayflower Hotel,
Washington, D. C.

BUREAU OF NARCOTICS

May 3 to May 14. Commissioner
Harry J. Anslinger, U.S. repre­
sentative, attending Annual
Meeting, Commission on Narcotic
Drugs, United Nations,
Lake Success, New York.

* *

WEEK OF MAY 10-1$, 1948

COMPTROLLER OF THE CURRENCY

Monday, May 10. L. A. Jennings,
Assistant Chief National Bank
Examiner, enroute to
American Samoa and Guam to
perform work in connection with
banking facilities in the
islands. Absent four to five
weeks•
Friday, May 14. Speech by
J. L. Robertson, Deputy
Comptroller, Annual Conven­
tion of the New Jersey Bankers
Association,Traymore Hotel,
Atlantic City, New Jersey, Subv
I
ject: "Some Things To Thank About." *

BUREAU OF CUSTOMS

Monday, May 10« Chief Counsel
Robert Chambers appears before sub­
committee of the Ways and Means
Committee with reference to HR
6159-6160, which would expand the
scale of activities permitted to be
carried on in Foreign Trade Zones,

Thursday, May 13* Burke H. Flinn,
Chief of Entry and Appraisement,
leaves by air for Geneva, Switzer­
land, to attend a divisional meet­
ing of the International Civil
Aviation Organization. Will return
June 5.

- 3r
BUREAU OF NARCOTICS

OFFICE OF TAX LEGISLATIVE
COUNSEL

Thursday, May 15, Speech by
Alfred L, Tennis on, head of the
Bureau’s legal section, before
the New York Academy of Science,
Subject: "Regulatory Problems
of New Analgesics Under the
Narcotics Law,"

Wednesday, May 12, 7 P,M> Speech
by Adrian W* DéWind, Tax Legis­
lative Counsel, before Second
Annual Meeting of the
Pennsylvania State College
Institute on Taxation, State
College, Pennsylvania, Subject;
aproposals Before Congress for
Changes in Tax Laws.n

U. S, COAST GUARD

Monday, May 10, Admiral
Joseph F, Farley, Commandant,
in London, England, attending
International Conference on
Safety of Life at Sea, He heads
U. S, delegation to conference,
and will be absent from Washington
for several weeks.

U. S. SAVINGS BONES DIVISION

Friday, May 14» Leon J. Markham,
Director of the Division’s
Payroll Savings Unit, in
Des koines- to confer with
leading industrialists of Iowa
in connection with Security
Loan Drive,
|
\

t
BUREAU OF INTERNAL REVENUE

Monday, May 10, Speech by
Carroll E. Mealey,
Deputy Commissioner in charge
of the Alcohol Tax Unit,
before the National Confer­
ence of State Liquor Adminis­
trators, Roosevelt Hotel,
New York City, Subject:
"Uniformity of Federal and State
Labeling Standards,"

NOTE - Items for the Treasury Calendar
may be sent to the Information Service,
Room 4416« Treasury Building, or phoned
directly over extensions 204.0-2041-266S,
Deadline, Tuesday noon

TREASURY DEPARTMENT
Information Service

WASHINGTON, D .C .

TREASURY DEPARTMENT
Washington

FOR IMMEDIATE RELEASE
Friday, A p r i l 30, 194-q

P r e s s Service
Ho. 3 - f / J

N e l l i e T a y l o e Ross, D i r e c t o r of th e Hint, w as swo n in
t o day for h e r f o u r t h ter m in that office, The o a t h was
4c
Ae
rt B e
, n n e t t Ohamp C l a r k of
administered. b y AÄ srts o c i a«+■
t e/N JTil
u s«+•
ti
the
Court of A p p e a l s for the D i s t r i c t o f Columbia, in the
p r e s e n c e of a g a t h e r i n g at the T r e a s u r y of f r i ends of
Mrs. Ross, p u blic officials, a n d T r e a s u r y associates.
Mrs. Ross first t o o k o f f i c e as Min t D i r e c t o r
on M a y 3, 1933« She was r e a p p o i n t e d b y P r e s i d e n t F r a n k l i n
D. R o o s e v e l t at the e x p i r a t i o n of her first a n d second
f i v e - y e a r terms, and b y P r e s i d e n t T r u m a n at the e x p i r a t i o n
of h e r t h ird term. H e r most recent r e a p p o i n t m e n t was
c o n f i r m e d b y the Senate A p r i l -vP •
She wi .s the first w o m a n ever n a m e d Min t Director.
On N o v e m b e r 4-, 1924-, she h a d b e c o m e the first w o m a n ever
elected
G o v e r n o r of a State, the State in h e r cs.se bei;
Wyoming.
She'
is r e s p o n s i b l e for gen er 8.1 direction"" of the
B u r e a u of tlie lint in W a s h i n g t o n and
of
Hints,
two A s s a y O f f i c e s and two B u l l i o n D e p o s i t o r i e s w h i c h
c o n s t i t u t e the B u r e a u * s f i e l d service. This r e s p o n s i b i l i t y
e x t e n d s to the s a f e k e e p i n g of the G o v e r n m e n t *s g o l d a n d s i lver
stocks, a m o u n t i n g to b i l l i o n s of dollars.
The U n i t e d S t a t e s B u l l i o n D e p o s i t o r y for g o l d at
Fort Knox, Kentucky, the B u l l i o n D e p o s i t o r y for s i l v e r at
W est Point, N e w York, A M a n e w M i n t b u i l d i n g at
San F r a n c i s c o a n d an a d d i t i o n to the M i n t b u i l d i n g at
D e n v e r all h ave been c o n s t r u c t e d
d u r i n g h e r service as
M int Director. C o i nage at the M i n t s d u r i n g h e f tenure
has t o t a l e d I

TREASURY DEPARTMENT
Washington

Press Service
No. S-713

FOR IMMEDIATE RELEASE,
Friday, April 30* 19^8«

Nellie Tayloe Ross, Director of the Mint, was sworn
in today for her fourth term in that office. The oath
was administered by Associate Justice Bennett Champ Clark
of the Court of Appeals for the District of Columbia, in
the presence of a gathering at the Treasury of friends of
Mrs. Ross, public officials;, and Treasury associates,
Mrs, Ross first took office'as Mint Director on
May 3, 1933. She was reappointed by President Franklin
D. Roosevelt at the expiration of her first and second
five-year terms, and by President Truman at the expiration
of her third term. Her most recent reappointment was
confirmed by the Senate April 20.
She was the first woman ever named Mint Director. On
November 4, 1924, she had become the first woman ever elected
Governor of a State, the State in her case being Wyoming.
She is responsible for general direction of the Bureau
of the Mint in Washington and of the three Mints, two
Assay Offices and two Bullion Depositories which constitute
the Bureau’s field service. This responsibility extends to
the safekeeping of the Government’s gold and silver stocks,
amounting to billions of dollars.
The United States Bullion Depository for gold at
Fort Knox, Kentucky, the Bullion Depository for silver at
West Point, New York, a new Mint building at San Francisco
and an addition to the Mint building at Denver all have
been constructed during her service as Mint Director, Coin­
age at the Mints during her tenure has totaled $970,000,000
face value; with the number of coins approximating
18,200,000,000. These figures exclude the large amount of
coinage done for foreign governments.'
0 O0

THlAstznr MPâjmiOT
for

sarnss, flmow

***•• s#rn<*

Tueeday, May 4, 1948.__ _______
Tiw» seeretary

JJ - ? /T

tha fr«u\txjr announced i ü l aveniag that

tenderà Tô t

$900,000,000, or thereabouts, of 91~day Traasury U l l l to ba dated May $ and to nature
Auguat 5, 1948, sfeleh were offered Aprii 30, 1948, were opened at tha Radami Réserve
Banks on May 3.
The datali« of tfci© issu© ara aa folle»»«:
Total applled for - $1,491,349,000
Total acceptai
903,450,000

Arare«« prie«

(include» $44,438,000 anterad cm a noncompetitive beala and aeoeptad la fall et
tha average prie« e bona below)
- 99*748 Equivalent rata of discount approx. 0.99# par annua
_|; igjp *r?

|8HI ■ Y :"v ’" 1v ;

V

Range of aeoapted competitive bide:
High
¡Lo»

» 99.752 Equivalent rate of dleoount approx. 0.98# por annua
- 99.747
•
*
*
»
»
1 .00# •
*

(57 percent of tba amount bld for at tba lo» prie© w s aeoapted}

rodarci Reserre
District

Total
Applied for

Total
Acceptai

Boston
Ha» Tarie
Philadelphie
Cleveland
Richmond
Atlanta
Chicago
St. louis
Minneapolis
gansas City
liailaa
San Francisco

#

9,190,000
1,199,356,000
43,300,000
48,458,000
3,330,000
7,392,000
82,462,C W
3,275,000
1,673,000
24,127,000
6,130,000
62.824.000

i

8,975,000
681,781,000
86,848,000
34,105,000
3,880,000
7,848,000
*4,660,000
3,146,000
1,460,000
19,072,000
6,130,000
89.174.000

fl.491,849,000

i

906,480,000

TOTAL

TREASURY DEPARTMENT
Washington

FOR RELEASE, M O W I N G N E W S P A P E R S
Tuesday, M a y 4, 1.948»

Press-Service
No. S-714

The S e c r e t a r y of the T r e a s u r y a n n o u n c e d last e v e n i n g that
the tenders for $900,000,000, or "thereabouts, of 9 1 - d a y T r e a s u r y
pills to be d a t e d M a y 6 and to m a t u r e A u g u s t 5* 1948, w h i c h w e r e
offered A p r i l 30, 1948, wer e opened at the F e d e r a l R e s e r v e B a n k s
on M a y 3.'
The d e tails

of this issue are as follows:

Total a p p l i e d for - $ 1 , 4 9 1 , 5 4 9 , 0 0 0
Total a c c e p t e d
9 0 5 * 4 5 0 , 0 0 0 (includes $ 4 4 , 4 3 8 , 0 0 0 en t e r e d
on a n o n - c o m p e t i t i v e b a sis and a c c e p t e d in
full at the a v e rage p r i c e s h o w n below)
Average p r i c e

- 9 9 * 7 4 8 E q u i v a l e n t rate of d i s c o u n t approx,. 0 . 9 9 8 ^
per annum

Range of a c c e p t e d c o m p e t i t i v e bids:
High = 9 9 * 7 5 2 Equiv. rate
Low
- 9 9 .747
. " v
"

of d i s c o u n t a p p r o x . 0 .9 8 1 $ p e r a n n u m
M
tf
1!
1 .0 0 1 #
"
"

( 5 7 p e r c e n t of the amount b id for at the low p r i c e was accepted)
Federal R e s e r v e
District

Total
A p p l i e d for

Boston
New Y o r k
P hiladelphi a
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San F r a n c i s c o

$

TOTAL

9 *1 9 0 * 0 0 0
1 ,1 9 9 ,3 6 6 , 0 0 0
4 3 ,3 0 0 , 0 0 0

Total
Accepted
$

8 ,9 7 5 , 0 0 0
6 8 1 ,7 8 1 , 0 0 0

48,458,000
3*350,000
7*392,000
82,462,000
3 *2 7 5 * 0 0 0
1 ,6 7 5 * 0 0 0
2 4 ,1 2 7 , 0 0 0
6 ,1 3 0 , 0 0 0
6 2 ,8 2 4 , 0 0 0

36,248,000
34,105,000
3*350,000
7 ,3 4 9 , 0 0 0
64,660,000
3,146,000
1,460,000
1 9 ,0 7 2 , 0 0 0
6 ,1 3 0 , 0 0 0
3 9 ,1 7 4 , 0 0 0

$ 1 ,4 9 1 ,5 4 9 , 0 0 0

$ 905*450,000

oOo

TR E A S U R E

FOR RELEASE, M
Thursday, M a y

M o r e than
e x p l o s i o n in N
d e v a s t a t i o n it
a n other d i s t r i b u t i o n of pay m e n t s to aw a r d e e s of the old M i x e d
Claims Commission, U n i t e d States and Germany.
The current d i stribution, a c c o r d i n g to a n n o u n c e m e n t m a d e .
today by S e c r e t a r y Snyder, w i l l total $ 6 , 3 7 1 * 0 8 2 . 7 3 , and checks
a g g r e g a t i n g $ 6 , 2 6 8 , 6 3 1 . 1 2 h a v e a l r e a d y b e e n m a i l e d to awardees.
One h u n d r e d and e i g h t y - f o u r indi v i d u a l s and c o r p o r a t i o n s h ave
re c e i v e d or w i l l receive c h e c k s . M a n y of the awards are b a s e d on
acts of sabotage c o m m itted by G e r m a n agents p r i o r to W o r l d W a r I,
the m o s t n o t o r i o u s of w h i c h w e r e the B l a c k T o m and K i n g s l a n d e x ­
plosions w h i c h occ u r r e d in 1 9 1 6 and 1 9 1 7 .

After twenty-odd years of litigation, the New Jersey munition
blasts were determined to have been acts of sabotage committed
by German agents. This decision was reached by the Mixed Claims
Commission, with the late Associate Supreme Court Justice Owen
Roberts serving as umpire, in 1939, validating claims against
the German Government growing out of the two disasters. German
representatives on the Mixed Claims Commission denied to the end
that their country was responsible.
Awards totaling $139,6 6 3 ,440.8 9 , bearing five percent
interest, were made in favor of American nationals by the Mixed
Claims Commission, and it was provided that interest accrued to
January 1 , 1 9 2 8 , would be added to the principal of awards. A
method of payment was provided in the Settlement of War Claims
Act of 1 9 2 8 , under which there was established in the Treasury
Department a "German Special Deposit Account."
Prom time to time, as funds became available to the German
Special Deposit Account, payments on awards have been made by
the Treasury, The last distribution, prior to the one now in
progress, was in 1941. Funds credited to the special account
Were derived for the most part from enemy holdings seized by the
United States Government during World War I, which included ships,
patents, and other properties. Receipts of $53,000,000 from the
German Government on account of its indebtedness to the United
States growing out of World War I were also received,
Following the 1941 distribution,
Account was practically out of funds,
awards was possible until the passage
August, 1947. This law provided that

the German Special Deposit
and no further payment of
of Public Law No, 375, in
the Office of Alien

TREASURY DEPARTMENT
Information Service

WASHINGTON, D .C .

FOR RELEASE, M O R N I N G N EWSPAPERS,
Thursday, M a y 6, 19^8<____________

Press S e r v i c e
Wo. S-715

M o r e t h a n t h i r t y - t w o years a f t e r the B l a c k T o m m u n i t i o n s
e x p l o s i o n in N e w Jersey, and two w o r l d w a r s r e m o v e d f r o m the
d e v a s t a t i o n it wrought, the T r e a s u r y D e p a r t m e n t is c o m p l e t i n g
a n other d i s t r i b u t i o n of payments to award e e s of the old M i x e d
Claims Commission, U n i t e d States and Germany.
The current distribution, a c c o r d i n g to a n n o u n c e m e n t m a d e
today by S e c r e t a r y Snyder, w i l l total $ 6 , 3 7 1 , 0 8 2 . 7 3 , and checks
a g g r e g a t i n g $ 6 , 2 6 8 , 6 3 1 . 1 2 h a v e a l r e a d y b e e n m a i l e d to awardees.
One h u n d r e d and e i g h t y - f o u r i n d i viduals and c o r p o r a t i o n s hav e
re c e i v e d or w i l l receive c h e c k s . M a n y of the awards are b a s e d on
acts of sabotage committed by G e r m a n agents p r i o r to W o r l d W a r I,
the m o s t n o t o r i o u s of w h i c h w e r e the B l a c k T o m and K i n g s l a n d e x ­
plosions w h i c h oc c u r r e d in 1 9 1 6 and 1 9 1 7 *
A f t e r t w e n t y - o d d y e ars of litigation, the N e w J e r s e y m u n i t i o n
blasts wer e d e t e r m i n e d to h a v e b e e n acts of sabotage com m i t t e d
by G e r m a n agents.
This d e c i s i o n was r e a c h e d by the M i x e d Claims
Commission, w i t h the late A s s o c i a t e Supreme Court J u s t i c e O w e n
Roberts s e r v i n g as umpire, in 1939> v a l i d a t i n g claims a g a i n s t
the G e r m a n G o v e r n m e n t g r o w i n g out of the two d i s a s t e r s .
German
re p r e s e n t a t i v e s on the M i x e d Claims C o m m i s s i o n d e n i e d to the end
that t h eir c o u ntry was resp o n s i b l e .
A w a r d s t o t a l i n g $ 1 3 9 ,6 6 3 , ^ 0 .8 9 , b e a r i n g five p e r c e n t
interest, w ere m a d e in f a vor of A m e r i c a n n a t i o n a l s by the M i x e d
Claims Commission, and it was p r o v i d e d that i n t erest a c c r u e d to
January 1, 1928, w o u l d be added to the p r i n c i p a l of awards.
A
meth o d of p a y m e n t was p r o v i d e d in the S e t t l e m e n t of W a r Claims
Act of 1928, u n d e r w h i c h there was e s t a b l i s h e d in the T r e a s u r y
D e p a rtment
a ’’G e r m a n Sp e c i a l D e p o s i t A c c o u n t , ”
P r o m time to time, as funds b e c a m e a v a i l a b l e to the G e r m a n
Special D e p o s i t Account, p a y m e n t s on awards h a v e b e e n m a d e by
the Treasury,
The last d i stribution, p r i o r to the one n o w in
progress, was in 19^-1.
Funds credited to the s p ecial account
Were d e r i v e d for the m o s t p a r t f r o m e n e m y h o l d i n g s seized by the
United States G o v e r n m e n t d u r i n g W o r l d W a r I, w h i c h i n c l u d e d ships,
patents, and o t her p r o p e r t i e s .
Re c e i p t s of $ 5 3 , 0 0 0 , 0 0 0 f r o m the
German G o v e r n m e n t on a c c ount of its i n d e b t e d n e s s to the U n i t e d
States g r o w i n g out of W o r l d W a r I w e r e also re c e i v e d ,
F o l l o w i n g the 19^1 d i s t r i bution,
Account was p r a c t i c a l l y out of funds,

the G e r m a n S p e c i a l D e p o s i t
and no f u r t h e r p a y m e n t of

2
P r o p e r t y of the D e p a r t m e n t of j u s t i c e w o u l d m a k e a v a i l a b l e to
the G e r m a n S p e cial D e p o s i t A c c o u n t the r e m a i n i n g funds d e r i v e d
f r o m the p r o p e r t i e s of Germans s e i z e d d u r i n g W o r l d W a r I, for
m a k i n g p a y m e n t on a c c r u e d interest on awards of A m e r i c a n n a t i o n a l s ,
To date, the a m o u n t r e c e i v e d has b e e n s u f f icient to cover a
d i s t r i b u t i o n of lOfo of interest a c c r u e d on awards in excess of
$ 1 0 0 , 0 0 0 to J a n u a r y 1, 19^7*
A f t e r the p r e s e n t d i s t r i b u t i o n ha s b e e n completed, i n d i c a ­
tions are that there w i l l be one m o r e d i s t r i bution, a g g r e g a t i n g
b e t w e e n $ 1 ,5 0 0 , 0 0 0 and $ 2 , 0 0 0 , 0 0 0 ,.f r o m funds p l a c e d in the
Special D e p o s i t A c c o u n t by the O f f i c e of A l i e n Property.
This
a n t i c i p a t e d d i s t r i b u t i o n w o u l d be the last on a c c o u n t of awards
of the M i x e d Claims Commission, in the a b s e n c e of n e w l e g i s l a t i o n
w h i c h w o u l d enable the p a y m e n t of considerable' b a l a n c e s w h i c h
will remain.
Since e s t a b l i s h m e n t of the G e r m a n S p e c i a l D e p o s i t A c c o u n t
in 1928
the T r e a s u r y has m ade p a y m e n t s on awards of the M i x e d
Claims C o m m i s s i o n t o t a l i n g $ 1 6 9 ,8 9 6 , 0 0 9 .3 2 . A w a r d s of the M i x e d
Claims C o m m i s s i o n for p e r s o n a l injury, and awards less tha n
$1 0 0 , 0 0 0 for p r o p e r t y damage, h a v e b e e n p a i d in full.
Interest
and p r i n c i p a l still due total a p p r o x i m a t e l y $ 1 0 0 , 0 0 0 ,0 0 0 .

0O0

"7?o S-?/é
i
“O' ^ L- ->e

} < =r~~~

/
»

In reply to inquiries, Secretary of the Treasui

John W. Snyder stated flatly ^that he has no' plans to

leave his Treasury post and that -when, as, and if

he does leave the Government service, his intention

is to return to the Middlerarest.

The Secretary added

that he has made no agreements as to his activities

after leaving the Government.

May 6, 1948

TREASURY DEPARTMENT
WASHINGTON, D .C .

Information Service

Wo. S- 7 1 6

FOR IMMEDIATE RELEASE,
Thursday, May 6 , 19^8.

In reply to Inquiries, Secretary of the Treasury
John W. Snyder stated flatly that he has no plans to
leave his Treasury post and that when, as, and if he
does leave the Government service, his intention is to
return to the Middle West,

The Secretary added that

he has made no agreements as to his activities after
leaving the Government,

-0 O0 -

7/7
- 3 of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections 1*2 and

117 (a) (1) of the Internal Revenue Code* as amended by Section 113 of the Reve­
nue Act of 19UT, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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. Ul8, as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

Tt&m*
. n.. r
-

2

-

amount ox 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 Secretary of the Treasury 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 Yihole 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 ary one bidder

y

o

. 1 1

be accepted in full at the

average price (in three decimals) of accepted competitive bids.

Settlement for

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

May 13, 19U8____ s in cash or other immediately avail-

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders will receive equal treatment.

May 13, 19H8___ .

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, shall not have any exemption, as-such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, Y/hether Federal or State, but shall be exempt from all taxation now or
hereafter imposed on the principal or interest thereof by any State, or ary of the
possessions of the United States, or by ary local taxing authority.

For purposes

ExhiM&fl
suras:
TREASURY DEPARTIRENT
Washington

£-7/7
FOR RELEASE, MORNING NEWSPAPERS,
Friday. May 7* 19U8._____

The Secretary of the Treasury, by this public notice, invites tenders for
„000,000,000

, or thereabouts, of

91

-day Treasury bills, for cash and

May 13» 19U8
, to be issued ©n
—
— fer—
“ 7
a discount basis under competitive and non-competitive bidding as hereinafter
in exchange for Treasury bills maturing

provided.
will mature
interest.

The bills of this series will be dated
August 1 2 , 19 U 8

May 13. 19lt8 •_____ > and

, when the face amount will be payable without

They will be issued in bearer form only, and in denominations of

$ 1 ,000 , $ 5 ,000 , $ 1 0 ,000 , $ 10 0 ,000 , $ 500 ,000 , and $ 1 ,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the
daylight saving
closing hour, two o ’clock p.m., Eastern/StliiSS^it time, Monday. May 10. 19li8
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 10 0 , 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•
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

TREASURY DEPARTMENT
Information Service

FOB RELEASE, MORNING NEWSPAPERS
Friday,, May 7, 1948»;_____ •

Wa s h i n g t o n , d .c .

;

' No.S-717

' The Secretary,., of ¡the Treasury, by this public notice, in­
vites tenders for $1,000,000,000, or thereabouts, of 9 1 -day
Treasury bills, for cash and in exchange for Treasury bills■ <
maturing May 13, 1948, 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 13, 1948, and will
mature August 12, 1948, 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, $5 0 0 ,0 0 0 ,
and ’$1,000,.000 (maturity value).
Tenders will be received at Federal Reserve Banks and
Branches: up to the closing hour, two o'clock p*m., Eastern day­
light saving time, Monday, May 10, 1948. 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 compe­
titive tenders the price offered must be expressed on the basis
of 100, with not more than three decimals, e..g., 9 9 .9 2 5 .
Fractions may not., be used . It is urged that tenders be made, on
the printed forms and forwarded in the special envelopes which L
will be supplied by Federal Reserve Banks or Branches on applica­
tion therefor.
"
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 Secretary of the Treasury 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

2

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 13, 1948^
in cash or other immediately available funds or in a like face
amount of Treasury bills maturing May 13, 1948. 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 .thevnew. bill's ; \
The income derived from Treasury bills, whether interest or
gain from the sale or other disposition of the bills, shall not
have any exemption, as such, and loss from the sale or other
disposition of Treasury bills shall not have any special treatment,
as such, under* the Internal Revenue Code, or laws amendatory or
supplementary thereto. The bills shall be subject to estate,
inheritance, gift or other excise taxes, whether Federal or State,
but shall be 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 shall be considered
to be interest. Under Sections 42 and 117 (a) (l); of the Internal
Revenue Code, as amended by Section 115 of the Revenue Act of
1941, the amount of discount at which bills issued hereunder are
sold shall not be considered to accrue until such bills shall be
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 Circulât N o . 4l8, as amended, 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

TREASURY DEPARTMENT
WASHINGTON. D .C.

Information Service

TC - 2

THE

T R E A S U R Y

C A L E N D A R

Scheduled Departmental Activities
WEEK OF MAY 10 - 15, 19^8

OFFICE OF THE SECRETARY

Tuesday, May 11« Secretary Snyder spent
the day with the Association of Reserve
City Bankers, holding their annual meet­
ing at the Hotel del Coronado, Coronado
Beach, California,
Thursday, May 13, 11:30 A.M, Weekly
press conference in the office of the
Secretary.

BUREAU OF THE MINT
Friday. May 14 (Noon). Director Nellie
Tayloe Ross will be honored guest and
speaker at a luncheon given by the
Washington Women*s Bond-a-Month League,
Sapphire Room, Mayflower Hotel. Subject
of speech: **The Importance to the In­
dividual of Savings Bond Purchases.**

BUREAU OF FEDERAL SUPPLY
OFFICE OF THE UNDER SECRETARY
Tuesday and Wednesday, May 11 and 12»
Under Secretary Wiggins appeared before
the Senate Appropriations Committee pn
the Treasury Appropriation Bill for
1949.

Friday, May 14, 10 A.M. Director
Clifton E. Mack and Stephen J. Spingam,
Assistant General Counsel, will appear
before the House Expenditures Committee
in connection with the proposed legis­
lation to transfer Whr Assets Adminis­
tration and possibly the Bureau of Fed­
eral Supply to Federal Works Agency*

OFFICE OF THE GENERAL COUNSEL
UNITED STATES COAST GUARD
Wednesday, May 12, Acting General Coun­
sel Lynch appeared before the Sub­
committee of the Senate Appropriations
Committee on S-2598 , permitting the in­
vestment of funds of insurance com­
panies organized in the District of
Columbia in obligations of the Interna­
tional Bank.

Friday, May 14. Lieutenant Commanders
J. D. McCubbin, G. E. Howarth and D. F.
Engel in Paris, France, as members of
the U. S. delegation to the European Mediterranean - North Atlantic Regional
Air Navigation Meetings. Will return to
Washington about the first of June.

Friday, May 14 (Noon), Speèch by
Thomas J., Lynch, Acting General Counsel,
before a luncheon meeting of the Ohio
State Bar Association, Commodore Perry
Hotel, Toledo, Ohio.

Friday and Saturday, May 14 and 13.
Congressional ¿oard of Visitors will be
at the Coast Guard Academy, New London.
Officers from Coast Guard Headquarters
accompanying the Congressional body are

UNITED STATES COAST GUARD
(Continued)

Rear Admiral Merlin O ’Neill, Rear Ad­
miral Ellis Reed-Hill, Commodore R. T.
McElligott, Captain A. C. Richmond, and
Commander S. F. Gray.

DIVISION OF SAVINGS BONDS
Friday, May 14, 7:30 P.M. Speech by
Leon J. Markham, director of Sales, at

Cedar Rapids, Iowa, before a dinner
meeting of Iowa industrialists. Sub­
ject: ’’The Importance of Payroll Sav­
ings to Your Corporation.”

COMPTROLLER OF THE CURRENCY
Friday, May 14. Speech by J. L.
Robertson, Deputy Comptroller, Annual
Convention of the New Jersey Bankers As­
sociation, Traymore Hotel, Atlantic City,
New Jersey. Subject: ”Some Things to
Think About.”

WEEK CP MAY 17 - 22, 19^8
OFFICE OF THE SECRETARY
May 20. Secretary Snyder will go to
Philadelphia as a member of the official
group accompanying President Truman, who
will deliver an address at Girard College

September 22. Speech before the an­
nual meeting of the National Associa­
tion of Supervisors of State Banks,
Louisville, Kentucky.

Statements By the Secretary
lay 21. 10 A.M. (Tentative). Press con­
ference in the Secretary’s ,suite at the
Columbus Hotel, Miami, Florida.
jfey 21. 1 P.M. Speech before the Second
Annual Foreign Trade Forum, Roof Garden,
Columbus Hotel, Miami. Subj ect: ”An
Expanding World Trade - the Primary Ob­
jective of United States Foreign Economic
Policy.”

Statement on National Maritime Day
Release Sunday, May 16. Available
to the press Friday, May 14.*
Statement on World Trade Week. Re­
lease Wednesday, May 19. Available
to the press Monday, May 17*.

OFFICE OF THE UNDER SECRETARY
Other Scheduled Speeches
Monday, May 24. Speech by the Secre­
tary before the Annual Conference of
the National Association of Mutual
Savings Banks, American Room, Hotel
Traymore, Atlantic City, New Jersey,
Subject: ’’Mutual Savings Banks and
the Public Debt.’*

Saturday, May 22, 8 P.M. Under Secretary
Wiggins will dèiiver an unprepared afterdinner speech before a group of Eastern
corporation executives at Skytop,
Pennsylvania. Subject of speech not yet
announced.

BUREAU OF NARCOTICS

office of the general counsel

Monday, May 17, 9 A.M. (Tentative).
Hearings before the Senate Judiciary
Committee on HR-5040, to cut off claims
under Section 17 of the Contract Set­
tlement Act of 1944. - Philip Nichols,
Chief Counsel, Bureau of Federal Supply,
will present the Treasury’s views.

Monday. Jfetv 17. 10:30 A.M. Alfred L.
Tennyson, head of the Legal Section,
represents the Bureau at a meeting of
the Committee on Drug Addiction and Nar­
cotics, National Research Council, 2101
Constitution Avenue, Washington, D. C.

DIVISION OF SAVINGS BONDS
TOTTED STATES COAST GUARD
Friday, May 21, 8 P.M. Speech by Captain
Roy L. Raney, USCG, Assistant Chief, Of­
fice of Merchant Marine Safety, before
Propeller Club of Savannah, Georgia, in
connection with the celebration of Na­
tional Maritime Week.

Tuesday. May 18. National Director
Vernon Clarke ^will address a meeting of
sixty Middle West corporation presidents
on the Security Loan Drive at Davenport,
Iowa.

COMPTROLLER OF THE CURRENCY
Admiral Joseph F. Farley, Commandant, in
London, England, for remainder of month
attending International Conference on
Safety of Life at Sea. To return about
the middle of June.

NOTE:

Wednesday. Thursday. Friday, May 19, 2ÇL
21. J. L. Robertson, Deputy Comptroller
in attendance at the annual meeting of
the Pennsylvania Bankers Association,
Traymore Hotel, Atlantic City, N. J.

Items for the Treasury Calendar may be phoned to the Information

Service over extensions 2040-204-1-2^68; Internal Revenue extensions 650651; Bureau of Federal Supply extension 457.

Deadline, Tuesday Noon.

.STATUTORY DEBT LIMITATION
AS OF "APRIL 30* 194^
Washington, May-^r 1948
Section 21 of the Second Liberty Bond Act, as amended, provides that the face amount of
obligations issued under authority of that Act, and the face amount of obligations guaranteed
as to principal and interest by the United States (except such guaranteed obligations as may
be held by the Secretary of the Treasury), »‘shall not exceed in the aggregate #275,000,000,01
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 shall be considered as its face amount.*'
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
Outstanding
Obligations issued under Second Liberty Bond Act, as amended:
Int erest-bearing:
Treasury bills................ . $ 13,748,052,000
Certificates of indebtedness....'
20,064,699,000
Treasury notes...... ..........
16,261,048,000 # 50,073,799,000
Bonds Treasury...................... 115,523,945,500
Savings (current redempt.value) 53,065,125,219
Depositary.............. .
316,505,000
Armed Forces Leave........
6 13 ,464,250
Investment Series............
961,450,000
170,480,489,969
Special Funds Certificates of indebtedness..
14,764,350,000
Treasury notes...............
14,436,786,000
Total interest-bearing...................
Matured, interest-ceased..................

29,201,136,000
249,755,424,969
288,966,775

Bearing no interest:
War savings stamps...........
59,484,132
Excess profits tax refund bonds
9,861,396
Special notes of the United States:
Internat'l Bank for Reconst.
and Development series....
1 1 5 ,785,000
Internat'l Monetary Fund series 1,178,000,000
Total........ .....................................

1 ,363 ,130,528
2 5 1 ,407 ,522,272

Guaranteed obligations (not held by Treasury):
Int ere st-bearing:
Debentures: F.H.A..............
27,849,186
Demand obligations: C.C.C.......
42,625,566
Matured, interest-ceased........... .......

#275,000,000,000

70,474,752
4,943,725
75,418,477

Grand total outstanding.... ...............................
Balance face amount of obligations issuable under above authority........

251,482,940,749
23,517,059,251

Reconcilement with Statement of the Public Debt - April 30, 1948
(Daily Statement of the United States Treasury, (May 3, 1948)
Outstanding Total gross public debt....................... ........................
Guaranteed obligations not owned by the Treasury.......................
Total gross public debt and guaranted o b l i g a t i o n s ...... .
Deduct - other outstanding public debt obligations*»,
not subject to debt limitation.................... .

252,239,912,658
______75,418,477
252,315,331,135
..... 8 32 ,390,386
251,482,940,749

STATUTORY DEBT LIMITATION AS' OF. iiPKIL 30. 19AS
Yiashington, May 10, 1943
Section 21 o f the Second lib e r t y Bond A ct, as amended, provides th a t the face
amount of o b lig a tio n s issued under au th o rity of th a t A ct, and th e fa ce amount of
obligations guaranteed as to p rin c ip a l and in te r e s t oy the United S ta te s (except such
guaranteed o b lig a tio n s as may be held b j the S e cre ta ry o f the T reasu ry), Ms h a ll not
exceed in the aggregate (.2 7 5 .1000, 000,000 outstanding a t any one-tim e. For purposes o f
th is se ctio n the current redemption value o f any o b lig a tio n issued on a discount b a sis
which i s redeemable p rio r to m aturity a t the option of the holder s h a ll bo considered
as i t s fa ce amount,u
The folio-wing ta b le shows the face, amount of o b lig a tio n s outstanding and the race
amount which can s t i l l be issued under t h is lim ita tio n :
()275,000,000,000
Total face amount that may be outstanding at any one time
Outstanding

O bligations issued under Second L ib erty Bond A ct, as amended:

Intcrost-bearing:

Treasury b i l l s « , ................
0 1 3 ,7 4 3 ,0 5 2 ,0 0 0
C e r tific a te s o f indebtedness 20,064 *6 9 9 ,0 0 0
Treasury n o t e s . , ....................
1 6 .2 6 1 .0 4 0 .0 0 0 i> 5 0 ,0 7 3 ,7 9 9 ,0 0 0
Bonds -

Treasury.. . . . . . . . . .. . . . .

115*523*945*500

Savings ( current redempt #uOue) $3 , 065 ,125 *219
316,505*000
D epositary......... ..
613*464*250
Armed Forces Leave
961 .4 5 0 .0 0 0
Investraent S e rie s . . . . .

Special Funds —
Certificates of indobtedness 1 4 ,7 6 4 .3 5 0 ,0 0 0
14*436*786,000
Treasury n o t e s ......
. Total interost-bearing........ .
Matured, interest-ceased................. .

1 7 0 ,4 0 0 ,4 8 9 ,9 6 9

20 j 2 0 1 T136.000

249*755,424,969
288,966,775

Bea.ring no interest :

Tar savings stamps. . . . . .
$9,484,932
Excess p r o fits ta x refund bonds n
9 ,8rsem
6 1 ,300
9 6A
S p ecia l notes o f the United S t a t e s :
In t e r n a t 11 Bank fo r R cccn st.
and Development s e r ie s
115,785,000
lj3 6 3 .1 3 0 .5 2 8
In t e rn a t11 McnefcaryHand Séria s 1 ,1 7 8 ,0 0 0 ,0 0 0
T o ta l* .................. ............................................................ * . * 2 5 1 ,4 0 7 ,5 2 2 ,2 7 2
Guaranteed o b lig atio n s (not hold by Treasury) :
In te re s t-b e a rin g :
Debentures: F.H.A. . . . . . . . .
2 7 ,8 4 9 .1 8 6
4 2.625.566
7 0 ,4 7 4 ,7 5 2
Demand o b lig atio n s ; C, G,,Ç,
Matured, in t e r e s t- c e a s e d ,. . . . .
4 ,9 4 3 .7 2 5
7 5 ,4 1 8 ,4 7 7
Grand t o t a l o u tstan d in g ,.. , ............................. . ....................................... | ___^ .
- j ■ 2 ..9 4 0 .7
. 49
»5lj48
Balance face amount o f o b lig atio n s issu a b le under above a u th o r ity .,
2 3 ,5 1 7 .0 5 9 .2 5 1
Reconcilement with Statement of the P u blic Debt - A p ril 30, 1948
(D aily Statement of th e United S ta te s Treasury, (May 3 , 1948)
Outstanding

Total gross public d e b t , * , . , , , , , , , , , , , , ........................ ...................
Guaranteed obligations not owned by the T re a su ry ,......... ..................... ..
Total gross p u blic debt and guaranteed o b lig a tio n s ........... '.................
Deduct — other outstanding pu blic debt o b lig a tio n s
not subject to debt limitation

3-718

2 5 2 ,2 3 9 ,9 1 2 ,6 5 8
........... 75,41 8 ,4 7 7
2 5 2 ,3 1 5 ,3 3 1 ,1 3 5
832.390,386
^ 2 5 1 .4 8 2 ,9 4 0 ,7 4 9

Press Service

ttBJOSS , W B B D B NESSPA PIERS,
Tussdty f May XX , 1948 «
_____

TOH

5 - 7 /?

Tli Secretary of thè Treasury announced Xast eveaing that thè tenderà for
#1*000,000,000, or thereabouts, of 91-day Treasury bills to he dated May 13 and to sature
August U , 1948, which «ere offered May ?» 1948» «ere opened et thè Federai Reserre Banks
oa May 10.
The detalls of this iseue are as follo«»:
fatai applied for ~ #1,474,845,009
Total accepted
* 1,005,625,000

Avere*» prie»

{Includes #45,526 »€90 entered on e non*»
competitive basi» and accepted In fall et
thè eveaege price show* belo«}
* 69,748 Bquivalent rete of dieeonat approx. 0.998$ per enxn»

Bang» of aeeepted competitive MA»:
High
Low

- 99.752 Squivalent rat# of dlseooat approx. 0.981$ per anno*
- 99.747
*
•
*
*
*
1.001$ *
*
{64 pereeat of th» aaocnt bid for et thè lo« price «ae aeeepted}

federai Reserve
Distriot

Total
Applied for

fatai
Aeeepted

Boston
Re« York
Philadelphia
Cleveland
Richmond
Atlanta
Ohieago
St. Ionie
Minneapolis
Shasas City
Balla»
Saii fraaeiseo

|

|

TOTAL

16,820,000
1,696,800,000
4,895,900
22,685,000
5,910,000
2,645,000
68,247,000
3,784,000
3,580,000
20,387,000
7,135,000
8>.9S8¥QOO

#1,474,243,000

16,698,000
814,080,000
4,504,000
18,997,909
3,910,000
8,648,000
89,407,000
3,682,000
3,546,000
16,817,000
7,027,000
SO.410,000

#1,008,688,000

F O R RELEASEj C O R N I N G N E W S P A P E R S
Tuesday, M a y 11, 1948._________ _

R e l e a s e No,

7 19

The S e c r e t a r y of the T r e a s u r y a n n o u n c e d last e v e n i n g that
the tenders for $ 1 , 0 0 0 , 0 0 0 ,0 0 0 , or thereabouts, of 9 1 -day
T r e a s u r y bills to be d a t e d M a y 1 3 and to m a t u r e A u g u s t 12, 1948,
w h i c h w e r e of f e r e d M a y 7 , 1948, w e r e o p e n e d at the F e d e r a l
R e s e r v e B a n k s o n M a y 10.
The d e tails

of this

issue are as follows*

Total a p p l i e d for - $ 1 , 4 7 4 , 2 4 3 , 0 0 0
Total a c c e p t e d
1 , 0 0 5 , 6 2 5 * 0 0 0 (includes $ 4 5 , 5 2 6 , 0 0 0 en t e r e d
on a n o n - c o m p e t i t i v e basis and a c c e p t e d in
full at the a v e rage p r i c e s h o w n below)
Average price

- 9 9 * 7 4 8 E q u i v a l e n t rate of d i s c o u n t approx.
per annum

0 .998 $

R a nge of a c c e p t e d c o m p e t i t i v e bids;
H i g h - 9 9 * 7 5 2 Equiv.
Low
- 99*747
"

rate of d i s c o u n t approx.
M
"
"
M

0 .9 8 1 $ p e r a n n u m
1.001$
”
"

(66 p e r c e n t of the a m ount b i d for'at the lo w p r ice was accepted)
Federal Reserve
District

Total
A p p l i e d for

Total
Accepted

Boston
New Y o r k
Philadelphia
C l e v eland
Ri c h m o n d
Atlanta
Chicago
S t , Louis
Minneapolis
Kansas City
Dallas
San F r a n c i s c o

$

$

16,820,000
1 ,2 3 6 ,2 0 0 ,0 0 0
4.895.000

2 2 ,6 8 5 ,0 0 0
3 910.000

.

2.645.000
68.247.000
3.784.000

.

3 580.000

TOTAL

1 6 ,6 5 0 ,0 0 0
814,030,000
4.504.000
18.997.000
3 .9 1 0 .0 0 0
2.645.000
53.407.000
3 .6 8 2 .0 0 0
3.546.000

.

2 0 .3 8 7 .0 0 0
7 ,1 3 5 , 0 0 0

16 817.000

83.955.000

6o,4lO,OOp

$1,474,243,000

$1 ,005,625,000

0O0 '

7 .0 2 7 .0 0 0

FOR IMMEDIATE RELEASE
MAI bfr*, 19*48

The Bureau of Customs announced today preliminary figures shoving
the imports for consumption of commodities vithin quota limitations
provided for under the General Agreement on Tariffs and Trade, from the
Beginning of the quota periods to May 1, 19*48, inclusive, as follows:

*
•

Commodity

$Import8 as
Unit
:of Kay 1,
of
19*48
:Quantity :

:

Period and Quantity

:
e
e

:

Whole milk, fresh
or sour

Calendar year

3 ,000,000

Gallon

3,003

Cream, fresh or sour

Calendar year

1 ,500,000

Gallon

*480

Butter

Quota ineffective for the period
April through October

Pish, fresh or frozen,
filleted, etc., cod,
haddock, hake, pollock,
Calendar year
cusk, and rosefish
White or Irish
potatoes:
Certified seed
Other

12 months from
Sept.

15,19*7

(l)

(1 )
2*.930,188

Pound

u . 037,336

150 ,000,000 Found 1 *6 ,568,609
60,000,000 Pound 52,505,962

The proviso to Item JlfW limits the
imports for consumption at the quota
rate to 12,*165,09*4 pounds during the
first 6 months of the calendar year»

Due to a provision of the President’s proclamation Ho« 2769 of
January 30» 19*4-8, in which the entry of a specified quantity of Cuban
filler tobacco, unstemmed or stemmed (other than cigarette leaf tobacco)
scrap tobacco affects the rate of duty on such tobacco from countries
other than Cuba, a record is maintained of imports from Cuba. 7**4*47»7l6
pounds of such Cuban tobacco were Imported for consumption during the
period January 1 to May 1, 19*4-8, inclusive«

TREASURY DEPARTMENT
Information Service

WASHINGTON, D .C .

PQft B E D H A T E REIEASE
Wednesday. Hay 1 2 . 1948

No , S-720

The Bureau of Customs announced today preliminary figures showing
the imports for consumption of commodities within quota limitations
provided for under the General Agreement on Tariffs and Trade , from the
beginning of the quota periods to May 1, 1948, inclusive, as follows:

Commodity

:

Period and Quantity

:Imports as
: Unit
:of May 1,
:
of
:Quantity :
1948

Tlhole milk, fresh
or sour

Calendar year

3 ,000,000

Gallon

3,003

Cream, fresh or sour

Calendar year

1 ,500,000

Gallon

480

Butter

Quota ineffect Lvc for the period
April through October

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

a)
24,9 30 ,18 8

TJhito or Irish
potatoes:
Certified seed
Other

60,000,000

3

1 2 months from 15 0 ,000,000
Sept, ?l5, 1947

(1)

Pound

11,037,336

Pound
Pound

146,568,609
52,505,962

The proviso to Item 717(b) limits the
imports for consumption at the quota
rate to 1 2 ,4-6 5 ,094- pounds during the
first 6 months of the calendar year.

Due to a provision of the President’s proclamation No, 2769 of
January 30, 194-8, in which the entry of a specified quantity of Cuban
filler tobacco, unstemmed or stemmed (other than cigarette leaf tobacco)
and scrap tobacco affects the rate of duty on such tobacco from countries
other than Cuba, a record is maintained of imports from Cuba. 7,44-7,716
pounds of such Cuban tobacco were imported for consumption during the
period January 1 to Hay 1, 1948, inclusive,.

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 VALUE; Provided, howfver, that
not more than 33 -1 / 3 percent of the quotas shall "be filled by cotton wastes
other than coiaher 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:

Total imports

^Established!

Imports

Established
Country of Origin ! »TOTAL QUOTA \ Sept. 20, 1947, j 33-1/3# of) Sept. 20, 194=7 .
i
i to May 1? 19l;81Total Quota!to May 1$
V
U n ite d Kingdom . , . . ,
C anada.......................... . .
F r a n c e ........... ...
B ritish I n d i a ......
N e t h e r l a n d s ..................
S w i t z e r l a n d ........... ...
B e lg iu m ........................... ...
J s p a n . .................................
C h in a .................... ...
E g y p t ............ .....................................
Cuba ......................................................
Germany.............................
I t a l y ..................................................
T o ta ls

4 ,3 2 3 ,4 5 7
2 3 9 ,6 9 0
2 2 7 ,4 2 0 1
6 9 ,6 2 7 j
6 8 ,2 4 0
4 4 ,3 8 8 1
3 8 ,5 5 9
3 4 1 ,5 3 5
1 7 ,3 2 2 j
8 ,1 3 5
6 ,5 4 4
7 6 ,3 2 9
2 1 ,2 6 3

19,703
111;,580

5 ,4 8 2 ,5 0 9

203,910

j

69,627
“

1 ,4 4 1 ,1 5 2

19,703

-

—

7 5 ,8 0 7

—
«•»

2 2 ,7 4 7
1 4 ,7 9 6
1 2 ,8 5 3

j

***

;

—
I
- ■

—

—

j
i

—
-

1 / Included in total imports, column 2.

-0O0-

2 5 ,4 4 3
7 ,0 8 8
1 ,5 9 9 ,8 8 6

— ■
—

19,703

j

FOR IMMEDIATE RELEASE
May 11, 1948____ ____

- 1 -

The Bureau of Customs announced today that preliminary data on imports of
cotton and cotton waste chargeable to the quotas established by the President’s
proclamation of September 5,
as amended, for the period September 20,
1947, to May 1, 1948,inclusive /\ as follows:
COTTON (other than linters)
(In pounds)

Country of
Origin

Under 1-1/8” other
than rough or harsh
under 3/4n
Established; Imports Sept.
20, 1947, to
Quota Mav 1, 1948

Egypt and the
Anglo-Egyptian
783,816
Sudan*.... ^
... •
•
247,952
Peru............•
British India.... 2 ,003,483
China....... *.••. 1,370,791
8,883,259
Mexico..........
618,723
Brazil...........
Union of Soviet
Socialist Repub­
475,124
lics. ............
5,203
Argentina........
•237
Haiti.... .
♦.. •
9,333
Ecuador..........
752
Honduras.........
871
Paraguay.........
124
Colombia.........
195
Iraq.............
British East
2,24 0
Africa...........
Netherlands East
71,380
I n d i e s . <
Barbados.........
Other British
21^321
West Indies 1/..
5,377
Nigeria.........
Other British
16,004
West Africa 2/..
Other French
689
Africa 3 /.......
Algeria and Tunisia
-

14,516,882
-l-/

W

---------

7

--------- -----

mm
21+7,952
19,852
—
8,883,259
618,723

1-1/8” or more
but less than
1-11/16” L/
Imports Sept.
20, 1947, to
M a y -1, 1948

1*3,571+,1+72
1,903,999
—

177,91+9
—
—
-

35,786,714

-

— .
—
—
—
—
-

«M.

-

-

—

—
-

-

•—

«ÉÉ

—

_

-

—

10,21,910

U5,656,1+20

"

7j Other than Gold Coast and Nigeria.
3 / Other than Algeria, Tunisia, and Madagascar.
Z/ Established Quota - 45,656,420.
5/ Established Quota - 70,000,000.

Imports Sept. 20,
1947, to May 1,
1948

-

1+75,121+
-

^

Less than 3/4"
harsh or rough 5/

35,786,774

TREASURY DEPARTMENT
Washington
No, S-721

FOR IMMEDIATE RELEASE
Wednesday. May 12 . 1948

The Bureau of Customs announced today that preliminary data on imports
of cotton and cotton waste chargeable to the quotas established by the
President*s proclamation of September 5, 1939, as amended, for the period
September ¿0, 194-7, to May 1, 1948, inclusive, are as follows i
COTTON (other than linters)
(In pounds)

Country7" of
Origin

Under 1-1/8” other
than rough or harsh
under 3/4”
^Established Imports Sept,
Quota
20, 1947, to
Hay 1. 1948

Egypt and the
An gl o-E gyptian
Sudan
783,8X6
Peru,.... .... .
247,952
British India,.,
2,003,483
China,.........,
1,370,791
Mexico...... „..
8,883,259
Brazil.,,..,...,
618,723
Union of Soviet
Socialist Ropublies .......... ,
4 7 5 ,12 4
Argentina ..... .
5,203
Haiti . . . . . . . . . . 4
237
Ecuador.........
9,333
Honduras...... ,
752
Paraguay,,......
871
Colombia..... .
124
Iraq...........
195
British East
Africa,....... .
2,240
Netherlands East
71,388
Indies.........
Barbados........
Other British
West Indies 1/,.
21,321
Nigeria....... .
5,377
Other British
West Africa 2/.,
<16,004
Other French
Africa 3 / ......
689
Algeria and Tunisia
-

14,516,882

mm

1-1/8” or more
but less than
1 -1 1 /1 6 " y
Imports Sept,
20, 1947, to
May 1. 1948

less than 3/4”
harsh or rough ¿/
Imports Sept, 20,
1947, to Hay 1,
1948

43 ,574,472

—

247,952
19,852
—
8,883,259
618,723

1,903,999
-

35,786,771
-

4 7 5 ,12 4

17 7 ,9 4 9

—
—
-

*
-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

10,244,910

45 ,656,420

35,786,771

y Other than Barbados, Bermuda, Jamaica, Trinidad, and Tobago.
2/ Other than Gold Coast and Nigeria,
3/ Other than Algeria, Tunisia, and Madagascar,
y Established Quota - 45^656^420,
y Established Quota - 70,000,000,

- 2 COTTON WASTES
(In pounds)
COTTON CARD STRIPS made from cotton having a staple of less than 1-3/16 inches
in length, GOOBER WASTE, U P WASTE, SLIVER WASTE, AND ROVING WASTE, 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 vjastes
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 inrocrts ^Established* Imports
s TOTAL QUOTA * Sept, 20* 1947, *33-1/3$ of sSopt.20, 1947
%
* to May 1. 1948 ¡Total Quotatto Ka^l.1948 — ■

United Kingdom*.....
Canada
Franco ..... .........
British India...... s.
Netherlands t.........
Switzerland..........
Belgium............
Japan ...,.......... .
China. ........ ......
Egypt...............
Cuba t............ .
Germany ..............

19,703
114,530
69,627
—
'—
— .
. 203,910

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
5,482,509

1/ Included in total imports, column 2.

oOo

1,441,152
75,807
22,747
14,796
12,853
—
—
f—
25,443
7.088
1,599,886

19,703
A
-*■'
—
19,703

✓ /

FOR IMMEDIATE RELEASE,
May 1J., 19k8________

If

The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and wheat flour entered, or withdrawn from warehouse, for
consumption under the import quotas established in the. President1s proclamation
of May 28, 1941, as modified by the President!s proclamations of Ap'ril 13, 1942,
and April 29,. 1943, for the 12 months commencing May 29, 194.?, as follows:

Wheat
Country
of
Origin

Established
Quota
(Bushels)

Canada
795,000
China
—
Hungary
Hong Kong
Is?
Japan ►
100
United Kingdom
—
Australia
100
Germany
100
Syria
Jew Zealand
—
)hile
100
Jether lands
Argentina
2,000
100
*t,aly
—
Juba
1,000
’ranee :■—
tveece
100
texico
—
'anama
II
ruguay
eland and Danzig
~
—
Sweden
ugoslavia
orway
Canary Islands
;
1,000
Rumania
100
ruat emala
100
>razil
Jnion of Soviet
Socialist Republics
100
100
Belgium

:
Imports
:May 29, 1 % ,
IMay 1 # 19k8
" (Bushels)
620
—
—
-

to

;

v

'

- .
. —
¿'r
-

■
-

Wheat flour, semolina,
crushed or cracked
wheat, and similar
wheat nroducts
Imports
Established :
Quota
: May 29, 1947,
•
• to May l f 19k8
(Pounds)
(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
—
—
—
• mm
—
4,000,000

800,000

- 0O0-

lM8,h$8
5,600
—
1,600
""
—
#■.
»
::'v—-*
—
—
*•
—
—
—
,•*
**■

mm

mm
**
y
5**
'
■ v/:.1,1^,656

treasury department

Tíashingt on
FOR IMMEDIATE RELEASE
Wednesday. May 12. 1948

No. S-722

^The Bureau of Customs announced today preliminary figures showing the
quantities of wheat and v/heat flour entered, or vd.thdravn from warehouse,
for consumption under the import quotas established in the Presidents
proclamation of May 28, 1941, as modified by the Presidents proclamations
of April 13, 1942, and April 29, 194-3, for the 12 months commencing
May 29, 1947, as follows:

Country
of
Origin

Canada
China
Hungary
Hong Kong
Japan
United Kingdom
Australia
Germany
Syria
New Zealand
Chile
Netherlands
Argentina
Italy
Cuba
France
Gree ce
Mexico
Panama
Uruguay
Poland and Danzig
Sweden
Yugoslavia
Norway
Canary Islands
Rumania
Guatemala
Brazil
Union of Soviet
Socialist Republics
Belgium

s Wheat flour, semolina,
s
crushed or era deed
Wheat
*
wheat, and similar
:
wheat products
Established : Imports
tEstablished : Imports
Quota
:May 29, 1947: Quota
¿May 29, 1947
__ stoMay 1.1948:
sto liav
1Q/3
TBushels;
(Bushels)
(Pounds)
(Pounds)

795.000

620

w

3 815,000
24-,000
13,000

'i¿

13.000

8,000

mm

100

1 ,448,458
5.600
1.6 0 0

75.000
1,000

100
100

5,000
5,000
1,000

M»

.

1,000
1,000

100
2,000
100

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
1,000

100
mm
mm
mm

-

mm
mm
—
—

1,000
100
100
100
100

620

800,000
0O0

4 ,000,000

1 ,455,658

FOR IMMEDIATE RELEASE
May 11, 19^8

The Bureau of Customs announced today preliminary figures
showing the imports for consumption of commodities on which quotas
were prescribed by the Philippine Trade Act of 19^6, from January 1
I 9I48, to May 1, I9I4 inclusive, as follows:

Products of
:
Philippine Islands:

Established Quota :
Quantity
:

8$0,000

Buttons

Unit of s
Quantity :

Gross

Cigars

200 ,000,000

Number

Coconut Oil

Iji48,000,000

Pound

Cordage

v

Rice
Sugars, refined )
unrefined)
Tobacco

6,000,000

it

1,01*0,000

H

Imports as 1
May 1, I 9I48

93,287
313,7ljO
32,575,209
623,386

l,90li,000,000

6,$00,000

II

113,672,378

11

183,335

FOR IMMEDIATE RELEASE
AcdnesdaVj May 12, 1948

No. S-723

The Bureau of Customs announced today preliminary figures
shoi.ing the imports for consumption of commodities on vjhich quotas
to re prescribed by the Philippine Trade Act of 194-6, from January 1,
1948, to May 1, 1948, inclusive, as fcllor/s:

Products of

t

Philippine Islands:

Buttons

E stab lish ed Quota, s
Unit of
x Quantity
Quantity

850,000

Gross

Cigars

200,000,000

Number

Coconut Oil

448,000,000

Pound

Cordage

6,000,000

n

Rice

1,040,000

tt

Sugars, refined )
unrefined)
Tobacco

:

Imports as of

: May 1, 1948

93,287
313,740
32,575,209
623,386
—

1,904,000,000

6 ,500,000

oOo

it

1X3,672,378

tt

183,335

YREA&UliT WEtàXSlOMf
Bmrera of Internai infimi
Waahington 25, 0« 0*
For Ir)|I««ì
George *« Sohoeneiaan, Costai««ioner ef Internai Bevenue, today reainded
taxpayera of thè ternination, effectlra ¿un» 15, of thè «ertine previsione «bteb
allorad gerirei poatponement of leeone tax return« of perenna «ho «»in «et of
tbe country.
Die generai poetponeoeat previsione nera of partlealar benefit te radere
of tbe rane* forane, but «rat of theee ara rad «enea bete long eiaee retarne*
bene ani bara file* «heterar rateine nera neeeeeesy* F0bile lev 384, enaeted en
Àugust 8, 1947, acoordingly terninated thè «ertine poetponeneate ee ef
Beceaber 31, 1947# but authorlsed tbe Coaaiesioner te nebe otber previsione te
trai* hardahipe* Cader thle authority, Coasdesloasr Schoeasaaa eet thè teralnetlen
dote et Ira 15# 1940# fra persone etili ebree* et thè beglnniag ef tbe yeer, en*
fine* elightly earlier detee fer persone ohe enee bade trailer*
Further extensione nlll be alloned only «bea neeeeeary te erra* hmrdehlp In
Indlvide*! ossee* in individuai aeedlng additional tlne ehould irrite e lottar
te tbe office ef tbe Oolleoter ef Interael bracane fra tbe dietriot «bere be
nelateine bis legai residence or «here he normally file« bis retarne*
Dm Ira 15 desoline le prinarlly fra tbe filine ef rataras fer tbeee yeare
fron 1941 te 1947, laclueive, during «hich tbe individuali lesene «ne suffletent
te require e return* In tbe esse of thè trae* S e rv ic e s , tbe Ineen» ef efflcere
«Si ueually euffieient to requlre 0 retura, bnt eallete* inani ective eervice pey
«ae compiately exempt. * tvelve-quarterly inetallnent pian fra payln* tbe tra le
eveileble te eerrleraea*
^osmlravlUane «ho bara bora working abroad alno ara effooto* by tho doadllno*
Ceralssioner Bchoenemaa elio znainded fralllee of doooeaod eervleeara that

P
fm

"1

*v

'f

•t♦

****** » , 194», w lU ba «ha deadllna far m in « alala» far tba ra ta * af 19U19*4 tM H pai» by aaa «ho «la» «hlla la aetlv» servi oa la «ha ama» fa m a ,
naia» far later jraare «ajr ba aa»a eithln thraa yaars aitar tba raturn aaa fila » ,
ar taa yaara aftar «ha tax aaa paid, whichever la latar. Clalaa ehould ba fila »
M fora 841 altb tba Colleotor of Internai Im a m te aba» tba tax aaa pai», «ha
ceUeotora» affla»» a O l ba «la» «e halp next-of-kin relative, prepara thaaa
«Ili«»

a» Q

mm

FOR Ii.lIEDIATE RELEASE
Thursday. hay 13, 1948

No, S-724

George J. Schoeneman, Commissioner of Internal Revenue, today reminded
taxpayers of the termination, effective June .15, of the wartime provisions
which allowed general postponement of income tax returns of persons who
were out of the country.
The general postponement provisions were of particular benefit to
members of the armed forces, but most of these men and women have long
sfnce returned home and have filed whatever returns were necessary.
Public Law 38A, enacted on August 8, 1947, accordingly terminated the
wartime postponements as of December 31, 1947, but authorized the
Commissioner to make other provisions to avoid hardships. Under this
authority, Commissioner Schoeneman set the termination date at June 15, 1948,
for persons still abroad at the beginning of the year, and fixed slightly
earlier dates for persons r/ho came back earlier.
Further extensions will be allowed only when necessary to avoid hardship
in individual cases. An individual needing additional time should write a
letter to the office of the Collector of Internal Revenue for the district
where he maintains his legal residence or where he normally files his
returns ,
The Juno 15 deadline is primarily for the filing of returns for those '
years from 1941 to 1947, inclusive, during which the individual’s income
was sufficient to require a return. In the case of the armed services,
the income of officers was usually sufficient to require a return, but
enlisted men’s active service pay was completely exempt, A twelve-quarterly
installment plan for paying the tax is available to servicemen.
Civilians who have been working abroad also are affected by the dead­
line.
Commissioner Schoeneman also reminded families of' deceased servicemen
that December 31, 1948, will be the deadline for filing claims for the
refund of 1941-1944 taxes paid by men who died while in active service in
the armed forces between December 7, 1941, and December 31, 1947, inclusive.
Claims for later years may be made within three years after the return was
filed, or two years after the tax was paid, whichever is later. Claims
should be filed on Form 843 with the Collector of Internal Revenue to
whom the tax was paid. The collectors’ offices rail be glad to help
next-of-kin relatives prepare these claims.

oOo

am, of Fairbury, Nebraska, former retail
appatZflLtti> National Director of Sales of
„„a United States Savings Bonds Division, effective May 17, 19ii8.
He will assume full

responsibility for the

coordination of promotional and sales activities^ of the^Washington
staff and bm field organization throughout the country.
A

He wa.ll

serve under the immediate direction of Vernon L. Clark, National
Director of the Savings Bonds Division.

FOR IMMEDIATE SEDEASE
Thursday. Hay 13. 19AS

No #.S*725

The Treasury Department today announced the appointment of
Leon J, Markham, of Fairbury, Nebraska, former retail chain executive,
as National Director of Sales of the United States Savings Bonds
Division, effective Hay Í?, 1948
He will assume full responsibility for the coordination of
promotional and sales activities of the division*s Washington staff and
its field organization throughout the c o u n t r y H e will serve under the
immediate direction of Vernon L, Clark, National Director of the
Savings Bonds Division*
Mr, Markham advanced step by step to his new post from the ranks
of the Volunteer bond salesmen who responded to the call of -the nation
when Japan forced America into the war tilth the attack on Pearl Harbor^<
Then manager of a Midwestern chain of department stores, ;he
immediately took on the Job of organizing war bond sales in his home
county. His work was so outstanding that he was designated state
administrator for the State of Nebraska War,Savings Staff,
Throughout the war he directed the Nebraska war loan drives*.. With
the end of the war he continued his service as state head of the
United Stages Sayings Bonds Division, t In January, 1947, he came to
Washington to become National Director.of the Payroll Savings Division*,,.

oOo

m

2

\
and of prospective passenger travel,
sense as a matter of sound

than common

economics.

is but common
It is more

sense - it is vitally essential as a matter

of preserving our defenses at the least cost.
f

t>

National Maritime Day commemorates the first
transatlantic crossing by steamer.
But this y e a r ’s observance of National Maritime Day^
as proclaimed by the President, has much more than
historical import.

It should be a forceful reminder of

the merchant marine policy which we declared almost a
dozen years ago.
Briefly,

that policy is to maintain a merchant fleet

adequate to our peacetime commercial needs and capable of
being transformed into a military and naval auxiliary in
a national emergency.

That policy calls, obviously, for

continuing provision for such additions and replacements
as are necessary to keep the merchant fleet up to requirement!
Our declared policy grew out of sad experience.
Lack of foresight thrust terrific ship-building problems
on us when serious defense emergencies developed.

We

learned the ’’hard w a y ” that emergency programs of ship
construction are far costlier than would be the measured
support of a continuing program such as was laid down by
the Merchant Marine Act of 1936.
Equipping ourselves amply for water-borne transport
of the goods we buy and sell in both domestic and world-trade,

This year's observance of National Maritime Day, May 22,
should remind the Nation forcefully of its merchant marine
needs, Secretary Snyder w K today in a statement taking 210te
A
of the event. His statement follows:
1

TREASURY DEPARTMENT
Information Service

WASHINGTON, D .C .

FOR RELEASE HORNING NEWSPAPERS
Sunday,
-_______

No. S-726

This year’s observance of National Maritime Day, May 22, should
remind the Nation forcefully of its merchant marine needs,
Secretary Snyder pointed out today in a statement taking note of the
event,. His statement follows.:
National Maritime Day commemorates the first trans­
atlantic crossing by steamer.
Bat this year’s observance of National Maritime Day,
as proclaimed by the President, has much more than historical
import,. It should be a forceful reminder of the merchant
marine policy which we declared almost a dozen years ago.
Briefly, that policy is to maintain a merchant fleet
adequate to our peacetime commercial needs and capable of,
being transformed into a military and naval auxiliary in a
national emergency. That policy calls, obviously, for con­
tinuing provision for such additions and replacements as are
necessary to keep the merchant fleet up to requirements,'
Our declared policy grew out of sad experience. Lack
of foresight thrust terrific ship-building problems on us
when serious defense emergencies developed.
We learned the
’’hard way” that emergency programs of ship construction are
far costlier than would be the measured support of a con­
tinuing program such as was laid down by the Merchant Marine
Act of 1936.
Equipping ourselves amply for water-borne transport of
the goods we buy and sell in both domestic and world-trade,
and of prospective passenger travel, is but common sense as
a matter of sound economics,- It is more than common sense —
it is vitally essential as a matter of preserving our defenses
at the least cost.

oOo

TREASURY
Information Servii

FOR IMMEDIATE R
Thursday, May 1

The Treasury has announced an offering of one-year one
and one-eighth percent Treasury Certificates of Indebtedness
in exchange for the Certificates of Indebtedness of Series
E-19^8 maturing June 1, 1948, in the amount of $1,777,142.,000,
and the Treasury Bonds of 1948 maturing June 15, 1948, in
the amount of $3 ,0 6 1 ,8 5 1 ,5 0 0 .
In making known the terms of the issue to be made avail­
able to holders of the June maturities, Secretary Snyder
stated that he intends to offer holders of the three series
of certificates which will mature on July 1 a one-year one
and one-eighth percent certificate of indebtedness.

0O0

TREASURY DEPARTMENT
Information Service

WASHINGTON, D .C .

FOR IMMEDIATE RELEASE
Thursday, May 13, 1948

No. S - 7 2 7

The Treasury has announced an offering of one-year one
and one-eighth percent Treasury Certificates of Indebtedness
in exchange for the Certificates of Indebtedness of Series
E-1948 maturing June 1, 1948, in the amount of $1,777,142,000,
and the Treasury Bonds of 1948 maturing June 1 5 , 1948, in
the amount of $3 ,0 6 1 ,8 5 1 ,5 0 0 .
In making known the terms of the issue to be made avail­
able to holders of the June maturities, Secretary Snyder
stated that he intends to offer holders of the three series
of certificates which will mature on July 1 a one-year one
and one-eighth percent certificate of indebtedness.

0 O0

Exhibits
Aim
TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,
Friday» May 1U, 19U8.

The Secretary of the Treasury, by this public notice, invites tenders for
$ 1,000»000»-OOP ) or thereabouts, of

91

-day Treasury bills, for cash and

to be issued on
1
•a discount basis under competitive and non-competitive bidding as hereinafter
in exçhange for Treasury bills maturing

May 20, 19L8

—

May 20. 19ii8
, and
—
—
--------------” -i.-i.-U lmature
u a UU l C
x v U .^ U .w u 19,
JLyy JLj
4 ^ _____}, V
VU CU uthe
liv ? JLface
dvC
damount
iJ iU t i l l O vvJL«i-«L
C/ j payable
J d j r CbUJLw VVa.O.
will
August
I9¿I48
when
will Ube
without
**
,
'1
interest* They will be issued in bearer form only, and in denominations of
provided.

The bills of this series will be dated

/
Tenders will be received at Federal Reserve Banks and Branches up to the
,V
daylight saving
closing hour, two o ’clock p.m., Eastern/Stanetadctime, Monday, May 1?, I 9I48

s—

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
theref or *
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 Secretary of the Treasury 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 competitive bids.

Settlement for

accepted tenders in accordance with the bids must be made or completed at the
May 20, I9I4.8
, in cash or other immediately availW * -----able funds or in a like face amount of Treasury bills maturing may 20, 19U8

Federal Reserve Bank on

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, shall not have any exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, whether Federal or State, but shall be exempt from all taxation now or
hereafter imposed on the principal or interest thereof by any State, or ary of the
possessions of the United States, or by any local taxing authority.

For purposes

. ..... {

x

,

V

0

MSgEL
- 3 of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections U2 and

117 (a) (1) of the Internal Revenue Code, as amended by Section 11$ of the Reve­
nue Act of 19U1, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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. I4I 8 , as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

TREASURY DEPARTMENT
Information Servir»»

.«T v d WASHINGTON, D .Ç .
t

Wo. 3-728.

,0. ''r^'Ud.V'

*1

.

•The Backetary of the Treasury, by this public notice, in.yit es-tenders for $1,000,000,000, or,, thereabouts,. of 91-day
Treasury bills, for cash .and in exchange-for*Treasury bills
maturing ,$ay .20, 1 9 ^8 , to be: is sued; on .a .discount, basis under
‘Competitive ‘and-ijton-,Competitive bidding.- as.^hereinafter provided.
The 'bills of. this *’se ries’ will?be dàt^d May <20, 194&, and -will
mature August- 1 9 ,v1-9^8, when the faqe-ampunt.-vill be payable
without interest,.':'They ;will/be-issued in 'bearer.form- only, and
in- dénominations of $1;00.0, $5.000, $10-,0p.0v' $i00r()00>:$‘5 0 0 ,0 0 0 ,
and $l;d00,O00.-maturity,value)'. '
^
■ /••/Tenders wiil bè received* *at Federal tReserve,' Banks' and
Branches up to-the-'»closing hour, two o'.clock-p'.ni., Eastern day*"light saving; .time/,.-Mb|ii^Ly, May 17, 19^8> Tenders, will hot be
received
the Treasury Department, Washington. ‘Each *tender
must.be for a h .even^iultiple.-*of'•'$!,0 0 0 ,. and in*:tHe case of compe
titive tenders the 'price offered must 'be expressed oh the- basis..of '.1 0 0 , •with .not more than three decimals> :e..'/g. , 9 9 ^ 9 2 5 !* v'Epac‘tions may-iiot ,b©...usedIt. is*, urged that* teiiders'be made .oil
the printed forms and"’forwarded ’iii the'special' envelopes .which
will be -supplied by 'iFed^pal Reserve Bank's, pr Bfanche.s' ^phrapplication the re far.-*
Kti 7 .*
•' ;; ... .»•.,•■-.-V-

at

'

♦

f

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r

•

-.T,

li’

‘

t *•'

.

. ‘' 4

- • ./?■ ■ >

.

/

>

.

•

1-

4

'

„

s *“

•

1

■ /* //'/ / v.

f.n •/

., * .■

ft,.»

• •> ;

Tenders .will be received, without deposit frbm .incorporated
banks and'trust companiesV.ahd from hesponsibleohhd'.rpjQognized
dealers in investment‘'securities . Tenders, frdm "others" must be
.accompanied by, payment of 2 percent pf' the face amount,-pf Treasury
bills applied' for, unless the tenders ^are? accompah!fe§'’i>y
express guaranty of payment by an incorporated '"Mhl^dr /trust '
company
Immediately after the closing hour, tenders will be opened
at fthe Federal-Reserve Banks and Branches, following which
public announcement will be made by the Secretary of'the Treasury
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 $2 0 0 ,0 0 0 or less without

2
stated price from any one bidder vili be accepted in; fluii at
the average price (in three decimals) of accepted competitive
b i d s . Settlement for accepted tenders in accordance vith the
bids must be made or completed at the Fè$è»a3.’- R è s a /o h / "
.*
May 20, 1948,. iri.cash or other immediately available ."funds ;or‘
in a like face amount of Treasury b i l l S ^ m a b ® î n g ’M ay ‘‘¿o^~Ì9Ì8.
Cash and Exchange tenders vili receive equal t r e a t m e n t . * Cash
adjustments v i l i , be -mad%,for..
•dîif-£e£eBçes/hètveèïi the/pUr'value
of maturing 'bilis accepted: i n exchange and ..the issue p rice of; •
the nev bills . .-\/ / V fé — .;
‘,v‘"
T h e >dîiçôme derived .from, Trea/sury- bills, v h e t h e r interest..*
or gaih r,rpîa/the sale or other, ’
d isposItiòn of the; bills, shall,
not have any e x e m p t i o n ,i as; such., and. loss from thè Sale or, other
dispositipn of.. Treasury bills shall- not have, -any special treats "
ment, as such.,•under the Internal-,Revenue Code,, or lavs amendatory
or supplementary thereto*
The bills shall be subject to estate., ;
inheritance, gift or other excise taxes, vhether Federal or
State, but shall pe qxempt from a l l taxation -nov-. or •h e r e a f t e r .’
imposed o n the' principal"or interest thereof by any State, or
any of the. possessions^ of the United States, or by rapy localr
taxing a u t h o r i t y .. F o r ’purposes .pf t a x a t i o n .t h e .amount o f ’discount
at vhi c h Treasury bills are .originally sold ¡by the United. States f
shall be considered tp.be i n t e r e s t U n d e r Sections 42:and 117
(a ) (1 ) :o f - the Internal. Revenue .Code, as ramended by- Section 115
of the Revenuè Act' of 1941,.. the amount -of .discount at v h i c h hills
Issued hereunder are..sold shall not be consideredr-to accrue;
•
until such bills s h a l l .be sold, redeemed or :otherwise disposed
of, and such bills are excluded from consideration as capital'
assets.
Accordingly, the ovner of Treasury bills (other than
life insurance companies ) issued h e r e u n d e r nbed-, include" -ih his
income tax,return only the difference; betveen thei-price paid for : such bills, vhether. on o r iginal•:1 ssue or on' -subsequent purchase, '
and th,e .amount actually received either upon sale ;or redemption'■
’;'/:
at maturity during the taxable year for vhich the..return is made,
as ordinary .gain .or loss *. .
‘v
?'v -'
Treasury Department Circular Ho. 4l8, as amended, and this
notice, prescribe the,,term¡%\.of th.e-;Treasury' b i l l s ;ahd g o v e r n/ -'- the conditions, ci*, their-issue,... /Copies of thé 'circular^ may ;'heJ- 1’
*• obtained, from a n y Federal Reserve -Bank or B r a n c h , f,u r.*#

;-

.

t ■ v --« -- *
>J; . - --• y
•• -r'*- * OGo -•

*7
-

2

-

000 ; 1945 , $2^,097 ,000 ,000 ;
000.

V'

000

;

/
■

/

the Victory Loan, last of the
1 oi/E Bonds outstanding was $30,938,000,000.

\ 7

of the

FOR IMMEDIATE RELEASE
Thursday, May 13, 1948

Press
No. S-

7¥)

Secretary Snyder announced today that an all-time record had been
reached April 30 in the total of Series E Savings Bonds outstanding.
A new record was scored also on the outstanding total of Savings
Bonds of all series, A through G* and the outstanding total of Series E, F
and G Bonds combined.
The figures for April 30, as announced by the Secretary, are:
All series, A to G inclusive, outstanding - $53*065,000,000.
Series E outstanding - $31*500,000,000

/
Series E-F-G inclusive outstanding - $50,467*000,000
Secretary Snyder announced the record-breaking totals in discussing the
progress of the Security Loan Drive.
“The Treasury is very gratified over the success of the drive so far,“
he said.

“The entire program is going very well.

“More than 2,000 business and industrial concerns have either rein­
stated the Payroll Savings Plan, or stepped up the activity of existing plan£.^ J
Volunteer bond-selling is at its peak since the end of the war.

Community V

campaigns are reporting favorable results.
“The news from all of the Security Loan Drive fronts is encour
E Bonds o

.standi

for

m m u m

ttot

release

Thursday, ifey 13, 194®*

S e c r e t a r y S n y d e r announced to d a y t h a t a n a l l - t i m e r e c o r d , had
been re a ch e d A p r il 3 0 in th e t o t a l o f S e r i e s E S a v in g s Bonds o u t­
s ta n d in g .
A new r e c o r d was s c o r e d a l s o on th e o u ts ta n d in g t o t a l o f S a v in g s
Bonds o f a l l s e r i e s , . A th ro u g h G, and th e - o u ts ta n d in g t o t a l o f
S e r i e s E , F' and- 0 Bonds com bined.
The f i g u r e s f o r A p r il 3 0 , a s announced by th e S e c r e t a r y , a r e ;.
AH s e rie s ,

A

t o G i n c l u s i v e , o u ts ta n d in g - $ 5 3 * 0 6 $ ,0 0 0 ,0 0 0

S e r i e s B o u ts ta n d in g - $ 3 1 * 5 0 0 ,0 0 0 ,0 0 0

Series E-F-G inclusive outstanding - $50,,4-67,000,000
S e c r e t a r y S n y d e r announced th e r e c o r d -b r e a k in g t o t a l s in d i s ­
c u s s in g th e p r o g r e s s o f th e S e c u r i t y Loan D r iv e .
"The T re a s u ry i s v e r y g r a t i f i e d o v e r - t h e s u c c e s s o f th e d r iv e
so f a r , * he s a id .,
HThe e n t i r e program i s g o in g v e r y w e l l .
"More th a n 2 ,.0 0 0 b u s in e s s and i n d u s t r i a l c o n c e rn s have e i t h e r
r e i n s t a t e d - t h e P a y r o l l S a v in g s P la n , o r ste p p e d up th e a c t i v i t y . o f
e x is tin g ’ p la n s .
V o lu n te e r b o n d * s e llin g i s a t i t s peak s i n c e th e end.
o f th e war*. Community cam paigns a r e r e p o r t i n g f a v o r a b l e r e s u l ts * wThe news from a l l o f th e S e c u r i t y Loan D riv e f r o n t s i s en­
co u ra g in g ..*1

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TO m * BAETFLTt
tìm following market tranaaetiena «are made dariBg th»
e£ Aprii# Ifèi# i» direct and goaranteed »«cariti«» of th« Ocrcram»nt for Treasary inroetment and other accouatai

Sai«« #*###*»#*♦**###♦•♦*♦#♦*<►* Ì2J#1|3O#O0O
Parchi««« ♦*♦#.#*#*.*#****•♦♦»*♦* 11^000^000
S v’"'■

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Nei SalM ....... 112,100,000

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(Sgd*.) Sa Pa Gerardi

Chief# Strialo« o>f Inreataenta

TREASURY DEPARTMENT
Information Service

WASHINGTON, D.

FOR RELEASE, MORNING PAPERS
Saturday-, May 15, 1948.____

No. S-730

During the month of April, 1948, market transactions
in direct and guaranteed securities of the Government for
Treasury investment and other accounts resulted in net
sales of $12,100,000, Secretary Snyder announced today.

oOo

- 9 to repeal a similar prohibition has recently passed both the House
and the Senate in the Commonwealth of Massachusetts and is now in
the hands of the conferees of the two chambers.

However, State taxes

are still widespread and repeal of the Federal taxes would make
jiuyflOTl contribution to intergovernmental tax integration by removing
one of the all too many instances of overlapping Federal and State taxes.
Conclusion
In summary it is the Treasury Department* s view that there is no

if1""

^

£

longer need for the use of revenue lavs tp regulate^the manufacture
and distribution of oleomargarine and that the Bhrean of Internal Revenue
might well be freed of this responsibility.

The oleomargarine taxes

unnecessarily burden consumers far in excess of the amount paid in taxes
and interfere with the optimum utilization of national resources.
Revenue considerations are not involved.
State-imposed taxes and prohibitions are so far-reaching that
even in the absence of Federal taxes oleomargarine would continue to
be unavailable to consumers in many parts of the country.

Nonetheless,

it is the Treasury* s view that the Federal taxes should be repealed.
Such action would eliminate one instance of overlapping Federal and
State taxation and would directly benefit consumers in the majority
of the States.

In the event, however, that the Congress deems it to be

necessary to continue the use of the tax instrument for regulating the
production and distribution of oleomargarine, this end would be fully
served if the present punitive tax rates were replaced by token tax
requirements.

- g -

State regulation
In addition to the federal taxes, large segments of American
consumers hear also the burden of State regulation.
of colored oleomargarine is prohibited in 22 States.

Today the sale
Three additional

States impose a tax of 10 cents a pound on the colored product.

In

23 States, the sale of colored oleomargarine is unfettered by excises
or State prohibitions.
Uncolored margarine is available without tax in all but 19
States.

Seven of the 19 States impose taxes ranging from

15 cents per pound.

5

cents to

In the other 12, the exemption of oleomargarine

made of domestic oils and fats or with a specific minimum of animal
fats renders the tax ineffective.

As a result of this factor and

the overlapping between States isihich tax colored and uncolored oleo­
margarine, approximately one-half of the States impose effective
restrictions on the sale of oleomargarine.
License fees for the manufacture or sale of margarine are required
in Ik States.

Annual fees for manufacturers and wholesalers vary from

$1 to $1,000, and for retailers from
page

Ji

50

cents to $H00.

(Table

\

uL ;
State taxes have been more onerous in the past than they are

now and the trend toward less State regulation of oleomargarine
continues both b y legislative and ¿Judicial action.

Less than a month

ago the State of Hew Jersey repealed its law \diich prohibited the
manufacture and sale of colored oleomargarine in that State.

A bill

/

- 7-

cents, the indirect “burden was substantially less than it is
today.

Unhappily this is also a period of high living costs.

While the imposition of these burdens through/fcaxatlon^is always
undesirable, it is especially objectionable at times when high
prices threaten the living standards of large groups in the
population.
Effect on use of resources
I would like to emphasize that the views of the Treasury
Department are concerned only with the tax aspects of the legisla­
tion before you.

It may be appropriate nonetheless to observe that

the oleomargarine taxes may interfere with the optimum utilization
of our resources.

It has been forcefully argued before this and

other Qommittees of Congress, for instance, that the national diet
would be improved if more milk were consumed in fluid form and
if the table fat requirement s of the Hat ion were obtained to a greater
degree from oleomargarine.

The Treasury is not in a position to

appraise the validity of this argument but I mention it only because
it illustrates the dangers involved in utilizing the taxing power
as a punitive instrument in channeling consumption in the direction
of some products and away from others.

It suggests that we should

exercise great restraint in the use of the tax system for such
purposes, except where the objective is clearly in the public
interest and cannot otherwise be secured.

the fact that the public is deterred from exercising its
preferences.

Many consumers are in effect prevented from pur­

chasing less expensive oleomargarine and are obliged to buy more
expensive butter or to forego, table fats altogether.
prefers yellow table
product.

The public

and has an aversion to the uncolored

The improved coloring facilities supplied by manufacturers

of uncolored margarine has not overcome consumers* resistance to
uncolored table fats.

The weight of the indirect burden resulting

from the oleomargarine taxes cannot be calculated but might be
illustrated.

The reluctance of distributors to become involved

with the machinery of oleomargarine tax enforcement, together with
the impediments imposed by many State laws, frequently preclude
consumers from effectively exercising a choice between competing
products.

Where consumers with equal preference for the two

products are unable to purchase HO-cent oleomargarine and are
obliged to pay

90

cents for butter, the indirect burden of these

taxes approximates the

50

cents difference between the selling price

of these items.
It should be noted that the indirect burdens imposed by these
taxes on consumers have substantially increased with the widening
of the differential between the price of oleomargarine and butter
in recent years.

During the prewar period when the price differen­

tial between yellow oleomargarine and butter was not more than

10

margarine in the postwar years» the share of the colored product in
total collections has risen to about Ho percent. (Table

2,

page * 2 .)«

Tax burden
.jar-» ■'»»«eaNft»» jLhe oleomargarine taxes belong to that category
of punitive consumption levies the burden of which increases as tax
collections decrease.

The tax may be said to impose a maximum

burden when it yields no revenue at all because in such cases it
Iprohibits consumption and diverts demand to substitute
products.

The Federal oleomargarine taxes» in combination with

State legislation» which I will describe later, approach this result.
The combined effect of th&se taxes is to place a burden on consumers
which falls with particular weight upon low^income groups.
For the majority of the population, the direct tax burden
represented by the oleomargarine taxes is small because they consume
only the uncolored product which is subject to the nominal one-*quarter
cent per pound.

Ninety percent of margarine consumption falls in this

!%
category.

(Table 3, page *30.

Those individuals who consume colored

margarine bear a serious tax burden in paying a
but their number is small.

10— cent

per pound tax,

The direct effect of the occupational

taxes on consumers is also small.

In 19^7 combined tax collections

from Federal excise and occupational taxes equaled about 1 cent per
pound of margarine sold.
The direct tax burden, however, is the lesser part of the cost
of these taxes to consumers.

The more important cost results from

- U -

However, if the Congress considers that there continues to he need
for the use of the Government 1s tax collecting agency for the regula­
tion of the marketing of oleomargarine, this objective could he served
hy the retention of only a nominal tax at the rate of, say, one-tenth
or one-fourth of one cent per pound, and correspondingly reduced
occupational taxes.
I should like to emphasize, however, that it is the Treasury 1s
view that as a general rule, excise taxes should he used only for
revenue purposes.

As revenue taxes, careful consideration should

he given to the rates and the tax hase to make sure that the pro­
ducers affected are not being placed at an undue competitive dis­
advantage or that the tax does not unduly burden low income consumers.
In a few cases, it may he desirable to use excises to prevent fraud or
the use of deleterious products.

In such cases, however, we should he

sure that there is a real need for such regulation and should he alert
to changing conditions which might not only remove the need for regula­
tion hut might make regulation undesirable.
Tax collections
•evenue produced hy the taxes on oleomargarine is
Collections in the current fieoel y ear and 4m the next
fiscal year are estimated at

$7

million each.

Throughout the thirties,

fl.-mrnai collections ranged between $l-l /2 and not quite $ 2- 1/2 million.
In fiscal year
$5 million.

19U 7

they were less than

$6

million and in

19U 6

about

Until recently, virtually all of the revenue was accounted

for hy uncolored oleomargarine.

With the increased use of colored

- 3substantially

developed and improved*

With special reference to

safeguarding the public health where affected hy interstate commerce,
the Congress has created the Pure “Food and Drug Administration*

This

organization is daily engaged in the task of ensuring the maintenance
of high food and médicinal standards and in safeguarding the consumer
against fraudulent representation of commodities marketed in interstate

Y
commerce*

Mpreovei|f^|>he development of the Government's administrative

agencies has been paralleled by a decline in the need for regulation
as standards of business conduct and self-imposed business standards
have improved*
This conclusion is borne out by the recent experience of the
Bureau of Internal Revenue with this tax*

In 19^7» almost 2"J^9000

taxpayers paid the special taxes ^ M a n u f a c t u r e r s of and dealers in
oleomargarine (Table 1, page M j .

A search of the Bureau* s records

indicates that during the decade since

1938,

jy

it found it necessary to

refer only four cases to the Department of Justice for prosecution for
violations of the labeling, marking and handling provisions of the
oleomargarine tax laws*

This does not include a number of violations

of a technical character which did not involve fraud or misrepresentation.
The effective development of public agencies charged specifically
with regulatory duties suggests that there is no longer any need
for the Bureau of Internal Revenue continuing in the field of oleo­
margarine regulation*

Its facilities could be more usefully devoted

to the discharge of its basic responsibilities in tax collection*

past century there was apparently need for using the Governments
..
ng power as a regulatory measure.

The taxing powlr was/use$

in connection with the regulation of the production or distri­
bution of a number of other commodities, such as narcotics and fire­
arms.

The imposition of a tar on the production, sale or importation

of a commodity, the distribution of which the Government finds it
necessary to regulate, enables the Government to establish rules,
regulations and reporting requirements with which manufacturers or
distributors must comply,

failure to conform to such regulations

constitutes a violation of the revenue laws and provides a vehicle
for regulatory purposes.
The use of a taxing power for this purpose is Justified in the
public interest when the regulatory ends cannot be achieved effectively
in other ways.

Howeve^^these ends require only the imposition of a

token tax, sufficient to establish liability for reporting and for a
tax obligation under the revenue laws, but nothing more.

Originally

the rate was 2 cents per pound on all domestic oleomargarine.

In

1902 the rate^ wo»o reduced to 1/4 cent per pound on uncolored and
raised to 10 cents on colored oleomargarine.

Prom the viewpoint of

regulating the sale of oleomargarine, this schedule of tax rates goes
far beyond such requirements* rimrt ‘flEiul »Vnhe weaidily
A further consideration is the fact that there appears to^yfce
little, if any, need lee* for the use of these taxes for regulatory
purposes.

Since their enactment^ the effectiveness of the Govern­

m e n t s administrative agencies as regulatory bodies has been

May 12, 1948

Statement on Oleomargarine Taxes

I am very glad to appear "before your Committee
tiliffi

to present the Treasury Departments

views on the tax aspects of the pending proposals which would modify
or repeal the excise taxes and occupational taxes on the manufacture
and distribution of oleomargarine.
Legislative history
At present oleomargarine is subject to a tax of 10 cents per
pound if it is yellow in color and to a rate of l/^ cent per pound if
it is uncolored.

Xnqoorted oleomargarine, whatever its color, is taxed

at a rate of 15 cents per pound.

In addition, annual occupational

taxes are imposed on the manufacturers and distributors of oleomargarine.
The manufacturers 1 occupational tax is $600 a year.

Viholesalers are

subject to a tax of $U80 if they distribute colored oleomargarine and
$200 if they handle only the uncolored product.
the occupational tax is
nnfl

$6

$^8

At the retail level,

for the distribution of yellow oleomargarine

for the distribution of uncolored oleomargarine.
of tax rates has “been in effect since

the origin of the taxes goes back to

1886,.when

1902,

"hut.

f1r»& imposed.

Regulatory aspects
The legislative history of these taxes and the considerations
advanced in their defense during their long history indicate that

itsL
their origin was associated with an effort to prevenly widespread^ and
fraudulent sale of oleomargarine as butter.

Toward the close of the

■v

For R e l e a s e on D e l i v e r y
TREASURY DEPARTMENT
Washington

S t a tement of U n d e r S e c r e t a r y W i g g i n s before
the Senate Committee on F i n a n c e

1 0 :00 A. M.,' M o n d a y , M a y 17,

1948

( O L E O MARGARINE TAXES)

I a m v e r y glad to a p pear before y o u r C o m m i t t e e to p r e s e n t
the T r e a s u r y D e p a r t m e n t ' s views on the tax aspects of the
p e n d i n g p r o p o s a l s w h i c h w o u l d m o d i f y or r e peal the excise
taxes and o c c u p a t i o n a l taxes on the m a n u f a c t u r e and d i s t r i b u ­
tion of o l e o m a r g a r i n e .
Legislative history
At pr e s e n t oleom a r g a r i n e is subject to a tax of 10 cents
per p o u n d if it is y e l l o w in color and to a rate of 1/4 cent
per p o u n d if it is uncolored.
I m p orted o l eomargarine, w h a t e v e r
its color, is taxed at a rate of 15 cents p e r pound.
In
addition, a n n u a l occu p a t i o n a l taxes are i m p osed on the m a n u f a c ­
turers a nd d i s t r i b u t o r s of o l eomargarine.
The m a n u f a c t u r e r s '
o c c u p a t i o n a l tax is $60 0 a year.
W h o l e s a l e r s are subject to
a tax of $ 4 8 0 if they d i s t r i b u t e colored o l e o m a r g a r i n e and
$200 if the y h a n d l e only the u n c o l o r e d product.
A t the reta i l
level, the o c c u p a t i o n a l tax is $ 4 8 for the d i s t r i b u t i o n of
y e l l o w o l e o m a r g a r i n e and $ 6 for the d i s t r i b u t i o n of u n c o l o r e d
oleomargarine.
A l t h o u g h this schedule of tax rates has b e e n in effect
since 1 9 0 2 , the o r i g i n of the taxes goes b a c k to 1 8 8 6 .
R e g u l a t o r y aspects
T h e ' l e g i s l a t i v e h i s t o r y of these taxes and the c o n s i d e r a ­
tions a d v a n c e d in t h eir de f e n s e d u r i n g t h e i r long h i s t o r y i n ­
dicate that t h e i r orig i n was a s s o c i a t e d w i t h an e f f o r t to
prevent the widespread, fra u d u l e n t sale of o l e m a r g a r i n e as
butter.
T o w a r d the close of the past c e n tury there was a p p a r ­
ently n e e d for u s i n g the G o v e r n m e n t ’s t a x i n g p o w e r as a
r e g u lator y me a s u r e .
The t a x i n g p o w e r was also b r o u g h t into use
in c o n n e c t i o n w i t h the r e g u l a t i o n of the p r o d u c t i o n or d i s t r i ­
b u tion of a n u m b e r of o t h e r commodities, such as n a r c o t i c s and

S-7 3 1

2
firearms.
The i m p o s i t i o n of a tax on the p r o d u c t i o n , sale or
impo r t a t i o n of a commodity, the d i s t r i b u t i o n of w h i c h the
Government finds it n e c e s s a r y to regulate, e n a bles the G o v e r n ­
ment to e s t a b l i s h rules, regu l a t i o n s and r e p o r t i n g r e q u i r e m e n t s
with w h i c h m a n u f a c t u r e r s or d i s t r i b u t o r s m u s t comply.
Failure
to c o n f o r m to such regu l a t i o n s c onstitutes a v i o l a t i o n of the
revenue laws and p r o v i d e s a v e h i c l e for r e g u l a t o r y pu r p o s e s .
The use of a t a x i n g p o w e r for this p u r p o s e is j u s t ified
in the p u b l i c interest w h e n the r e g u l a t o r y ends cannot be
achieved e f f e c t i v e l y in other w a ys.
H o w e v e r , these ends r e q uire
only the i m p o s i t i o n of a t o k e n tax. s u f f i c i e n t to e s t a b l i s h
liability for r e p o r t i n g and for a tax o b l i g a t i o n u n d e r the
revenue laws, but n o t h i n g more.
O r i g i n a l l y the rate was 2 cents
per p o u n d on all d o m e s t i c o l e o m a r g a r i n e , In 1902 the rate was
reduced to 1/4 cent p e r p o u n d on u n c o l o r e d and r a i s e d to 10
cents on c o l o r e d oleomargarine.
F r o m the v i e w p o i n t of r e g u l a t i n g
the sale of oleomargarine, this schedule of tax rates goes far
beyond such r e q u i r e m e n t s .
A f u r t h e r c o n s i d e r a t i o n is the fact that there a p p ears to
remain little, if any
n e e d for the use of these taxes for
r egulatory purposes.
Since t h e i r enactment, the e f f e c t i v e n e s s
of the G o v e r n m e n t ’s a d m i n i s t r a t i v e agenc i e s as r e g u l a t o r y bodi e s
has b e e n s u b s t a n t i a l l y d e v e l o p e d and improved.
W i t h sp e c i a l
reference to s a f e g u a r d i n g the p u b l i c h e a l t h w h e r e a f f e c t e d by
interstate commerce, the Con gress has c r e a t e d the Pure F o o d
and D r u g A d m i n i s t r a t i o n .
This o r g a n i z a t i o n is d a i l y e n g a g e d in
the tas k of e n s u r i n g the m a i n t e n a n c e of h i g h food and m e d i c i n a l
standards and in s a f e g u a r d i n g the c o n s u m e r a g a i n s t f r a u d u l e n t
r e p r e s e n t a t i o n of commodities m a r k e t e d in i n t e r s t a t e commerce.
Moreover, the d e v e l o p m e n t of the G o v e r n m e n t ' s a d m i n i s t r a t i v e
agencies h as b e e n p a r a l l e l e d by a d e c l i n e in the n e e d for r e g u ­
lation as standards of b u s i n e s s conduct a nd s e l f - i m p o s e d
business standards h a v e improved.
This c o n c l u s i o n is borne out by the r e c e n t e x p e r i e n c e of
the B u r e a u of Internal R e v e n u e w i t h this tax.
In 1947/ a l m o s t
2 7 5 ,0 0 0 t a x payers p a i d the special taxes on m a n u f a c t u r e r s of
and dealers in ol e o m a r g a r i n e (Table 1, page 8 .). A s e a r c h of
the B u r e a u ’s records indicat es that d u r i n g the d e cade since
1938, it found it n e c e s s a r y to r e f e r only four cases to the
D e p a rtment of J u s tice for p r o s e c u t i o n for v i o l a t i o n s of the
labeling, m a r k i n g and h a n d l i n g p r o v i s i o n s of the o l e o m a r g a r i n e
tax laws , This does not include a n u m b e r of v i o l a t i o n s of a
technical c h a r a c t e r w h i c h d id not involve fraud or m i s r e p r e s e n ­
tation.
The e f f e ctive d e v e l o p m e n t of p u b l i c ag e n c i e s ch a r g e d
specifically w i t h r e g u l a t o r y duties suggests that there is no
longer a ny n e e d for the B u r e a u of I n t e r n a l R e v e n u e c o n t i n u i n g
in the field of o l e o m a r g a r i n e r egulation.
Its faci l i t i e s could

J

*

- 3 be m o r e u s e f u l l y d e v o t e d to the d i s c h a r g e of its basic
resp o n s i b i l i t i e s in t a x collection.
However, if the Congress
considers that t h e r e , c o n t i n u e s to be n e e d f or the use of the
G o v e r nment's tax c o l l e c t i n g a g e n c y for the r e g u l a t i o n of the
m a r k e t i n g of oleomargarine, this obj e c t i v e could be s e rved b y
the r e t e n t i o n of only a n o m i n a l tax at the rate of, say, onetenth or o n e - f o u r t h of one cent p e r pound, and c o r r e s p o n d i n g l y
reduced o c c u p a t i o n a l t a x e s .
X should like to emphasize, however, that it is the.
Treasury's v i e w that as a g e neral rule, excise taxes should be
used o nly for revenue purposes.
As revenue taxes, careful c o n ­
sideration should be g i v e n to the rates and the tax base to
make sure that the p r o d u c e r s a f f e c t e d are not b e i n g p l a c e d at
an u n due c o m p etitive d i s a d v a n t a g e or that the tax does not
unduly b u r d e n low income consumers.
In a f e w cases, it m a y be
desirable to use excises to p r e v e n t fraud or the use of d e l e t e r ­
ious p r o d u c t s .
In such cases, however, we should be sure that
there is a real n e e d for such r e g u l a t i o n a n d should b e . a l e r t to
changing conditions w h i c h m i g h t not only remove the n e e d for
r e g u lation b u t m i g h t m a k e r e g u l a t i o n u n d e s i r a b l e .
Tax coll e c t i o n s
The r e v enue p r o d u c e d b y the taxes on o l e o m a r g a r i n e is
relatively little.
Collections in the c u r rent a nd the n e x t
fiscal y e a r are e s t i m a t e d at $7 m i l l i o n each. - T h r o u g h o u t the^
thirties, a n n u a l c ollections r a nged b e t w e e n $1-1 / 2 a nd not quite
$2-1/2 mil l i o n .
In f i s c a l y e a r 19^7 they wer e less t h a n $6
million and in 1946 about $5 m i l l i o n .
U n t i l recently, v i r t u a l l y
all of the r e v e n u e was a c c o u n t e d for by u n c o l o r e d o l e o m a r g a r i n e .
With the i n c r e a s e d use of colored m a r g a r i n e in the p o s t w a r
y e a r s , the share of the colored p r o d u c t in total c o l l e c t i o n s has
risen to about 40 p e r cent.
(Table 2, pag e 9 )»
Tax b u r d e n
The o l e o m a r g a r i n e taxes b e l o n g to that c a t e g o r y of p u n i t i v e
consumption levies the b u r d e n of w h i c h i n c r eases as t ax c o l l e c ­
tions decrease.
The tax m a y be said to impose a m a x i m u m b u r d e n
when it y i e l d s no r e venue at all b e cause in such cases it
effectively p r o h i b i t s c o n s u m p t i o n and di v e r t s d e m a n d to s u b s t i ­
tute products.
The F e d e r a l o l e o m a r g a r i n e taxes, in c o m b i n a t i o n
with State legislation, w h i c h I w i l l d e s c r i b e later, a p p r o a c h
this r e s u l t . The combined effect of these taxes is to p l a c e a
burden on consumers w h i c h falls w i t h p a r t i c u l a r w e i g h t u p o n
low-income g r o u p s .
F o r the m a j o r i t y of the population, the d i r e c t tax b u r d e n
represented b y the o l e o m a r g a r i n e taxes is small b e c a u s e they
consume o n l y the u n c o l o r e d p r o d u c t w h i c h is subject to the
nominal o n e - q u a r t e r cent p e r pound,
N i n e t y p e r c e n t of m a r g a r i n e
consumption falls in this category.
(Table 3, p age 10).
Those

- 4 individuals who consume colored m a r g a r i n e b e a r a serious tax
burd e n in p a y i n g a 1 0 - cent p e r p o u n d tax, but t h eir n u m b e r Is
small.
The d i r e c t effect of the o c c u p a t i o n a l taxes on consumers
is also small * In 1947 combined tax c o l l ections f r o m F e d e r a l
excise and o c c u p a t i o n a l taxes e q u aled about 1 cent p e r p o u n d of
mar g a r i n e sold.
The d i r e c t tax burden, however, is the l e s s e r p art of the
cost of these taxes to consumers,- The m o r e i m p o r t a n t cost results
from the fact that the p u b l i c is d e t e r r e d from e x e r c i s i n g its
normal p r e f e r e n c e s .
M a n y consumers are in effect p r e v e n t e d f r o m
p u r c h a s i n g less exp e n s i v e o l e o m a r g a r i n e and are o b l i g e d to b u y
more e x p e n s i v e b u t t e r or to forego table fats alto g e t h e r .
The
public p r e f e r s y e l l o w table spreads and has a n a v e r s i o n to the
u n c o lored pr o d u c t .
The i m p rov ed c o l o r i n g f a c i l i t i e s su p p l i e d by
manuf a c t u r e r s of u n c o l o r e d m a r g a r i n e has n ot overcome c o n sumers 1
resistance to u n c o l o r e d table f a t s , The w e i g h t of the i n d irect
burden r e s u l t i n g f r o m the o l e o m a r g a r i n e taxes c a nnot be c a l c u ­
lated but m i g h t be illustrated.
The r e l u c t a n c e of d i s t r i b u t o r s
to become i n v olved w i t h the m a c h i n e r y of o l e o m a r g a r i n e tax
enforcement, t o g e t h e r w i t h the impediments i m p o s e d b y m a n y State
laws, f r e q u e n t l y p r e c l u d e consumers f r o m e f f e c t i v e l y e x e r c i s i n g
a choice b e t w e e n
c o m p e t i n g p r o d u c t s , W h e r e consumers w i t h
equal p r e f e r e n c e for the two p r o ducts are u n a b l e to p u r c h a s e
40-cent o l e o m a r g a r i n e and are o b l iged to p ay 90 cents for butter,
the i n d irect b u r d e n of these taxes a p p r o x i m a t e s the 5 0 cents
difference b e t w e e n the s e l l i n g p r ice of thhse i t e m s .
It should be n o t e d that the indirect b u r d e n s im p o s e d b y
these t a xes on consumers h a v e s u b s t a n t i a l l y i n c r e a s e d w i t h the
widening of the d i f f e r e n t i a l b e t w e e n the p r i c e of o l e o m a r g a r i n e
and b u t t e r in recent y e a r s . D u r i n g the p r e w a r p e r i o d w h e n the
price d i f f e r e n t i a l b e t w e e n y e l l o w o l e o m a r g a r i n e and b u t t e r was
not m o r e t h a n 10 cents, t he indirect b u r d e n was s u b s t a n t i a l l y
less t h a n it is today.
U n h a p p i l y this is also a p e r i o d of h i g h
living c o s t s . W h i l e the i m p o s i t i o n of these b u r d e n s through t a x ­
ation Is always undesirable, it is e s p e c i a l l y o b j e c t i o n a b l e at
times w h e n h i g h p r ices t h r e a t e n the l i v i n g standards of large
groups in the popu l a t i o n .
Effect on use of r e s o urces
I w o u l d like to emp h a s i z e that the v i e w s of the T r e a s u r y
Department are c o n c erned only w i t h the tax a s p e c t s of the l e g i s ­
lation b e f o r e you.
It m a y be a p p r o p r i a t e n o n e t h e l e s s to observe
that the o l e o m a r g a r i n e taxes n a y ...i n t erfere w i t h the o p t i m u m
utilization of our resources.
It h as b e e n f o r c e f u l l y a r g u e d
before this and o t h e r C o m m ittees of Congress, for instance, that
the n a t i o n a l diet w o u l d be imp r o v e d if m o r e m i l k w e r e co n s u m e d
In fluid f o r m and if the table fat r e q u i r e m e n t s of the N a t i o n
were o b t a i n e d to a gr e a t e r degree f r o m o l e o m a r g a r i n e . The
Treasury is not in a p o s i t i o n to appraise the v a l i d i t y of this
argument but I m e n t i o n it only b e c a u s e it i l l u s t r a t e s the d a ngers

■ - 5 i n v olved in u t i l i z i n g the t a x i n g p o w e r as a p u n i t i v e ins t r u m e n t
in c h a n n e l i n g c o n s u m p t i o n in the d i r e c t i o n of some p r o d u c t s
and a way fro m o t h e r s , It suggests that we shou l d ex e r c i s e great
restraint in the use of the tax s y s t e m for such purposes,
except w h e r e the objective Is. c l e arly in the p u b l i c i n t erest
and cannot o t h e rwise be secured.
State r e g u l a t i o n
In a d d i t i o n to the F e d e r a l taxes, large segments of A m e r i c a n
consumers b e a r also the b u r d e n of State r e g u l ation.
T o d a y the
sale of colored ol e o m a r g a r i n e is p r o h i b i t e d in 22 S t a t e s . Three
a d d i t i o n a l States impose a t ax of 10 cents a p o u n d on the co l o r e d
product.
In 23 States, the sale of colored o l e o m a r g a r i n e is
u n f e t t e r e d by excises or State p r o h i b i t i o n s ,
U n c o l o r e d m a r g a r i n e is av a i l a b l e w i t h o u t tax in all bu t 19
States.
S e v e n of the 19 States impose taxes r a n g i n g f r o m 5 cents
to 15 cents p e r pound.
In the o t her 12, the e x e m p t i o n - o f o l e o ­
m a r g a r i n e m a d e of d o m e s t i c oils and fats or w i t h a specific
m i n i m u m of a n imal fats renders the t a x i neffective.
As a result
of this f a c t o r and the o v e r l a p p i n g b e t w e e n States w h i c h tax
colored and u n c o l o r e d oleomargarine, a p p r o x i m a t e l y o n e - h a l f of
the States impose eff e c t i v e r e s t r i c t i o n s on the sale of o l e o ­
margarine .

License fees for the manufacture or sale of margarine are ~
required in 14 States. Annual fees for manufacturers and whole­
salers vary from $1 to $1,000, and for retailers from 50 cents
to $400. (Table 4, page ll).
State taxes h a v e b e e n m o r e onerous i n the p a s t t h a n the y
are now, and the trend toward less State r e g u l a t i o n of o l e o ­
m a r g arine continues b o t h by l e g i s l a t i v e and judicial action.
Less t h a n a m o n t h ago the State of N e w J e r s e y r e p e a l e d its law
w h i c h p r o h i b i t e d the m a n u f a c t u r e and sale of c o l o r e d o l e o m a r ­
garine in that State.
A bil l to repeal a s i m i l a r p r o h i b i t i o n
has r e c e n t l y p a s s e d b o t h the H o u s e and the S e nate i n the
C o m m o n w e a l t h of M a s s a c h u s e t t s and is n o w in the h a n d s of the
conferees of the two chambers.
Ho w e v e r , State taxes are still
w i d e s p r e a d and r e p e a l of the F e d e r a l taxes w o u l d m a k e some
c o n t r i b u t i o n to i n t e r g o v e r n m e n t a l tax i n t e g r a t i o n by r e m o v i n g
one of the all too m a n y instances of o v e r l a p p i n g F e d e r a l and
State t a x e s .
Conc l u s i o n
In summary, it is the T r e a s u r y D e p a r t m e n t ' s v i e w that there
is no l o n g e r n e e d for the use of revenue laws to r e g u l a t e the
m a n u f a c t u r e and d i s t r i b u t i o n of o l e o m a r g a r i n e and that the
B u r e a u of In t e r n a l Revenue m i g h t w e l l be f r e e d of this r e s p o n s i ­
bility.
The o l e o m a r g a r i n e taxes u n n e c e s s a r i l y b u r d e n consumers
far in excess of the amount p a i d in taxes and I n t e r f e r e w i t h the
optimum u t i l i z a t i o n of n a t i o n a l r e s o u r c e s , R e v e n u e c o n s i d e r a ­
tions are n ot Involved*

-

6

-

S t a t e - i m p o s e d taxes and p r o h i b i t i o n s are so f a r - r e a c h i n g
that e v e n in the a b s ence of F e d e r a l taxes o l e o m a r g a r i n e •would
continue to be u n a v a i l a b l e to consumers i n m a n y p a rts of the
country.
N o n e t h e l e s s , it is the T r e a s u r y ' s v i e w that the
Federal taxes should be repealed.
Such action would eliminate
one i n s tance of o v e r l a p p i n g F e d e r a l and State t a x a t i o n and
would d i r e c t l y benefit consumers in the m a j o r i t y of the States.
In the event, however, that the C o n gress deems it to be n e c e s ­
sary to c o n tinue the use of the tax i n s t r u m e n t f o r r e g u l a t i n g
the p r o d u c t i o n a nd d i s t r i b u t i o n of o l eomargarine, this end
would be f u lly served if the p r e s e n t p u n i t i v e tax rates w e r e
replaced by t o k e n tax r e q u i r e m e n t s ,

- 7 -

Tables

Page No.
Table 1

Table 2

Table 3

Table 4

Number of taxpayers of special taxes on
manufacturers of and dealers in oleomargarine* fiscal years 1934-1947 ..............

8

Collections from oleomargarine taxes *
fiscal years 1934-1949 ........................

9

Production and withdrawals of colored and
uncolored oleomargarine* fiscal years
1934-1947 and first eight months of fiscal
year 1948 ............ .................

10

State oleomargarine excises and license
fees* May 1$, 1948 ...... ................ .

11

- 8 ~

T&ble 1
Number of taxpayers of special taxes on manufacturers of
and dealers in oleomargarine, fiscal years 1934-1947

Fiscal
year

Retail dealers
:
Manu: Wholesale dealers :
: Uncolored,
: facturprs,: Colored,: Uncolored,: Colored,
$6
$480 ;
$48
:
:
$600
:
$200
:

1934

47

4

2,407

79

104,852

1935

45

4

1,275

160

155,415

1936

42

4

1,340 ,

73

160,565

1937

41

4

1,471

57

174,591

1938

38

2

1,665

64

184,214

1939

40

3

1,636

38

173,727

1940

42

10

1,507

26

162,720

1941

42

2

1,486

37

162,038

1942

45

2

1,422

34

163,791

1943

72

14

1,731

133

182,643

1944

44

47

1,962

1,132

200,048

1945

47

121

1,973

3,842

218,889

1946

45

125

1,893

3,981

243,295

1947

47

176

2,204

5,102

265,984

Treasury Department, Division of Tax Research
Source:

Annual Reports of the Commissioner of Internal Revenue.

Table 2
Collections from oleomargarine taxes, fiscal years 193^-19^9
(Thousands of dollars)
:Colored, 1 Uncolored,
Fiscal jlO^ per | ifkfi per
year
pound
' pound

193*4

$

us

85
56
68
65

1935

1936
1937
19 3 s
1939

39

19*40
19*41
19*42
19*43

31
50
87
238
1,081
2,219
1,8*42

19*4*4

19 U 5
19*46
19 H7

2 ,1 3 2

19*48(est.)

19U9(estv)

If

1/

$

603
898
916
968
1,033

822
759

851
889
1,088

1 ,1 9 0

Manu• facturers,
$600
$ 28

î

bnecial taxes
Wholesale dealers
♦
Colored, : Uncolored, :
$200
$*480
$ I98

10
8

209

5
5

2*49

2

272
3 16
302
283

3
*4
2

28*4

268
287

3

2
*4
5
2

26

1

28
32
29 '

33

1/

1/
1/

*4

26
&

Treasury Department, Division of Tax Research

Retail dealers
Uncolored,
Colored,
?6
$*48

$ 10

27
25
27
25
28
25

1,35 6
1,191
1,1-4*41

V

:
;

$

1

$ ,^
1 76

81*4
9*48
1,007

2,0*49
2,20*4

1,0 2 1

2, *466

1,01*4

2 ,2 10 .

2 ,31+s

3

2

969

2,2*4*4

7

357

7^

36*4

131
16*4
22*4

1/
1/

If
1/

If

5S7

2,01*4

*412

i

Total

:
•

909
905

20
*49
5*4

386

$

1.

2,.12 2

965

2 ,6 2 1

1,317
1,330

*4,08*4

1,2 9 8

U ,932

1,60*4

5.S7U

1/

If

r
vO

5,303

7,000 2 /
7,000 2 /

t

/
Source*

if
Zf

Annual Reports of the Commissioner of Internal Revenue and The Budget of the United States Government,
fiscal year 19*49•

Hot available.
includes collections from taxes on adulterated butter*

Table 3
Production and withdrawals of colored and uncolored oleomargarine,
fiscal years 1 9 3 *+-19*+7 and first eight months of fiscal year 19*+3
(Thousands of pounds)

Piseal
year

193*+
1935

19 3 6
I 9 37
19 3 8

Uncolored
•
Colored
:Tax-free withdrawals
Tax-free withdrawals :
; Tax-paid
Tax-paid
; For
; For use of
For
use
of
1
For
:
Produced
Produced:
‘withdrawals
withdrawals*
:
exportrUnited
States
*
• export :United States:
»

2 ,6 8 9

*+63

2,905
2,773

303

1,59*+
l,*+09

527

1^ 7 1

1 ,9 6 7

673

53*+

1 ,6^9

62 *+

200
15 6

333
363

6*+9

396
2 ,0 7 6

1,381
1,360

1939
19*+0

19*+1

*+,*+89

19 ^ 2

l*+,828
116,970
135,003

19*+3
1 9 *+*+
19 U5

632
631
731
7*+l

355

302
U 27
667
2 ,1 0 *+

7 2 ,6 3 6

10,393
2 1 ,2*+3

19*+6
1 9*+7

6 6 ,*+l0
6 5 ,9 6 0

17,913
2 l,Ì 26

19*+7 (3 mos. )
I 9 Ï+S (0 mo s . )

*+7 ,6 2 6
*+3 ,3 9 3

13,37*
27,965

1 ,8 6 5
2,939

10,955

1,5 5 8
326

110 ,3 0 2
1 2 5 ,9 0 2
*+3 ,*+*+0

2,023
3,222
3,030

2/
2/

*+1,396

3 6 ,7 5 8

4

2/

2 *+0 ,*+9 S
350,916
3 6 3 ,96 *+
337,297
H13.755
331*592
3 Ò 1 ,353

2*+0,*+10
3 5 0 ,1 1 U
3 6 8 ,9 2 7
3 8 6 ,7 7 6

if
1/

-

1/
-*

*+13,561

-

3 3 1 ,7 0 2

If
2
1

339 ,*+*+6

301,599
3 H O ,5 5 0

353,977
*+3 1 ,*+98
*+7*+,023

353,6U8
*+29 ,*+69
i+73,*^2

5^ 0 , 3 1 3

5 3 3 ,7 ^

7.171»

*+8*+,792
5 7 6 ,*+*+6

*+81 ,*+93
571,083

3,285
573

393,737
533,6*+2

395,727
523,300

-

2/
2/

Annual Reports of the Commissioner of Internal Revenue and Internal Revenue Builetin.

i f Dess than 500 pounds.
2 / Not available.

- x 1
3
-

8
-

10

Treasury Department, Division of Tax Research
Sourcei

—

27

1 1 *+
i, 6*+5
700
5*+7

2/
2/

Table 4
State oleomargarine excises and license fees,
May 15, 1948

:
:
State

California
Colorado
Connecticut
Delaware
Florida
Georgia
Idaho
Illinois
Iowa
Kansas
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Montana
Nebraska
New Hampshire
New York
North Carolina
North Dakota
Ohio
Oregon
Pennsylvania
South Carolina
South Dakota
Tennessee
Texas
Utah

Excise.tax
:
:Containing

:Colored!
T reig?
;
:colored .-materials
:...
:
:
1/
. ( Cents per pound’)

Annual license fees
Manu­
facturers

YiTholesalers

] Public
Retailers] eating
] places

(In dollars)

-X '

|>100
25
100

100
-x-X-

450
25
50

46

200

50

42

10
10
100
•X-X-

U

fp 1

50
5
10
12
10

*
•>'c

-X•x*

0*50
1

10 3/

0

-X100

1
1,000
25

1
400
1

0

10
10

10

10 4/

-X-

75
5 4/

2 4/

2

2

2

300

75

5

10
10
10

10

Vermont
Washington
Wisconsin
MVnrrn r.

10 £/
10
5

25
15
15

1,000

ITreasury Department, Division of Tax Research
Footnotes on next page*

500

2 - 100
25

3

~

12

-

Table 4 — Concluded

State oleomargarine excises and license fees
May 15, 1948

Footnotes

-x1/

2/
3/

4/
5/

Manufacture or sale of colored margarine prohibited.
Tax applies to oleomargarine (colored or uncolored) not made from
oils and fats (specifically named by the statute) that are largely
derived.from domestic materials.
Idaho also prohibits the manufacture or sale of colored margarine.
Minnesota’s tax applies to oleomargarine not containing a minimum
percentage (65$) of animal fats, as well as that made of foreign
materials. Wyoming’s tax applies only to vegetable oleomargarine
(containing 20$ or less of animal fats).
The license is for 2 years.
Tennessee’s tax applies to all colored margarine, regardless of
ingredients. Uncolored margarine is exempt if made from domestic
oils and fats.

/

0

essential dignity and freedom of man.
And we must be sufficiently practical
to subordinate any immediate
differences to the preservation of
these be Ii efs.
i am convinced that the
cooperation which has conspicuously
marked our InternationaI relations
will prove to the world how sensibIe
and how profitable it is for nations
to live in an atmosphere of friendsni
and interdepenaent well-being.

"7 ^

whether direct or indirect
In all these efforts, we know
tnat we are acting in concert with
those nations which are making a
willing and common contribution to
the development, strength, and
protection of free countries
everywhere.
The patterns of growth of these
nations must necessarily vary greatly
But the democratic principles
basically guide that growth remain
same.

firmly believe in the

1

33 -

of

the

United States to help

deserving countries.

But we must

emphasize that our resources have a
definite limitation.

Moreover, we

have incurred an enormous debt in
helping to prosecute the recent war.
We have exhausted a substantial part
of some of our natural resources in
the defeat of forces of domination
and destruction.

We are continuing

to assume huge obligations in order
to promote world economic recovery
and to put a stop to aggression,

maximum productive efficiency in manyj
lines of activity in the United
States, with high levels of
employment and income.

The abi lity

to obtain from other countries goods
and services which they can produce
at relatively low costs or which can
supplement goods and services
unavailable in the United States will
enhance the productive efficiency of
our industries and will

improve the

standards of living of us all.
It has been, and is, the desine

- 37 -

V

some of the m o r e significant problems
confronting world trade today, and

p

we have considered some of the steps
necessary to surmount those problems.
The conclusion is clear cut.

It

is vital to the United States and to
the world that internat ionaI trade
/
be maintained at the highest possible
level.

It is essential to the

economic and political welfare of
e v e r y country

prevalence of

export

markets make it possible to achieve

7/ ^
agreed at Bogota that no American
State will deprive foreign enterprises
or capita! of legally acquired rights
or property for reasons, or under
conditions different from those which
the constitutions and laws of the
respective States provide for the
expropriation of n a t ionaI Iy-owned
enterprises or capital.

Furthermore,

any expropriation must be accompanied
by payments to the owners in a prompt,
adequate, and effective form.
Thus, briefly, we have summarized

whatever reasonable and practical
measures are within our power in
order to promote economic development
and rising standards of living in
that area,

te only ask that they,

for their part, also do what is
reasonable and practical for the same
objecti ve.
I should like to mention one
further agreement reached at Bogota,
namely that pertaining to the
expropriation of foreign-owned
investments.

It was generally

7 ^

34

the flow of internet IonaI investment
capitai.

The Treasury continues to

look with favor toward the
negotiation of bilateral tax treaties
to reduce international double
taxation of incomes.

Our Government

is prepared to discuss such treaties
witn other governments and is hopeful
that much progress can be made in
such negotiations.
Our Latin American neighbors
may be confident that we are
sincerely determined to take

of nttiona Iity.
The American States agreed
further that they would individually
see«, within the framework of their
respective constitutions, to
liberalize their tax laws as they
apply to income from foreign sources
and to avoid discriminatory or
unduly burdensome taxation.
. In this connection, the United
States Government is prepared to
consider various possible revisions
in its tax laws in order to f a c i l i t â t

V"

- 32 -

they have supplied.

7^

They agreed

that they would impose no
unjustifiable restrictions upon the
withdrawal of the earnings on
foreign investments or the
repatriation of those investments.
They agreed to provide just and
equitable treatment for all
personnel, national and foreign,
employed in foreign-owned enterprises
and to permit the employment of a
reasonable number of technicians and
administrative personnel, regardless

31

which should be a useful stimulus to
private foreign investment in Latin
Ameri ca.
The American States agreed' for
example, that foreign capital shall
receive equitable treatment.

They

agreed that they would not take
unjustified, unreasonable or
discr¡minatory measures which would
injure the legally acquired rights
or interests of nationals of other
countries in the enterprises, skills,
capital, arts or technology which

the same basis as those domesticallyowned.

At the same time, assurance

of fair treatment is essential before
any foreign private capital will
invest in a particular country.
It is highly significant to
note the constructive accomplishments
of the Ninth Internationa I Conference
of American States recently concluded
at Bogota, Colombia.

The Basic

Agreement of inter-American Economic
Cooperation which was signed at that
Conference contains many provisions

1 ^

the United States of a high
of imports ana exports will tend,
however, to eliminate the unbalanced
conditions of international payments
which in turn

r

ive rise to

burdensome exchange restrictions*
^ —

Every country has the right

and the obligation, of course, to
take such

ic measures as it

deems necessary for the
its own nationals.

of

It must, for

example, insist that foreignenterprises adhere to its laws on

-

28

-

^

discouraged by three special risks;
the risk of burdensome restrictions
imposed on fore ign-owned enterprise;
the risk of confiscation;

and the

risk that foreign-exchange
restrictions may prevent him from
freely converting the currency he
earns on nis investment.

Any

country which hopes to attract
foreign capital can easily remove
the first two of these risks.

To

deal with the third is admittedly
more difficult.

The maintenance by

reason for the lack of interest on
the part of private investme-n^s-.

In

many cases there has also been the
feeling that outside capital

is not

wanted.
The flow of foreign private
capital

into a country is governed

almost entirely by the investors'
estimate of the prospect for a
reasonable return.

The average

investor is prepared to take normal
business risks.

But when he turns

to the foreign field he is easily

American countries.
I

^ —

This unfortunate condition, the

lack of capital for development,

is

in part due to the financial status
of many Latin American countries
which in the 1930's were compelled
to reduce, and in some cases stop
entirely, the service of their
external funded debt.

Of course,

this situation today is considerably
improved.

However, this financial

status of some of the South
American countries is not the only

I

- 25 -

7^

For example, some of the Latin
American countries have huge

Mm

H SÈ

petroleum reserves, some of which
resources have been untapped because
the capital necessary to develop them
has not been avai table.

The same

situation is true with other mineral
m
J

I *’"■'.

resources.

EeiRSi

Furthermore, capital

is needed

for establishing and expanding a

miès

Igpœ

great many basic industries, for
transportât ion and for agricultural
developments in certain of the Latin

WSmk

abroad for investment opportunities.
For example, when foreign investments
in the United States reached almost
$7 billion in 1914, our assets in
foreign countries amounted to
$3.5 billion.

Other countries go

through this same experience of
exporting venture capital at the very
time when their capital market must
still seek strong outside aid.
Turning to the Western Hemispher
the need for foreign capital
investment is particularly apparent.

capital can give vastly important

,r

w i

assistance in the economic
development of a nation.

There is an interesting angle to ,a

lose sight.

During their early

Ccci

foreign investment of which we often

development, countries are consi deredlJc
to be importers rather than exporters
of capital.

The truth is, however,

that at the very time when the inflow
of foreign capital

is at its peak,

an outflow of capital starts as
vigorous enterprises begin look ing

search of gold, silver, copper,

iron,

petroleum, coal, and so forth.
This foreign capital also found its
way into the steel mills, refineries,
textile mills,

insurance companies,

mortgages, all types of manufacturing
companies, and an almost endless list
of other investments.
No wonder,

in view of its role

in our own economic expansion, we
in this country very naturally have
a healthy respect for the speed and
efficiency with which private foreign

21
remind you that from the standpoint
of the economy of our country before
World War 1, this was a very
substantial figure.
The diversity of the fields into
which this foreign capital went
reads like a roster of our leading
industries.

in agriculture there

were numbers of land and cattle
companies, and cotton plantations.

In mining there were investments in
well established companies, and
scores of ventures were financed in

The capita! markets of Europe —
particularly of Great Britain, France,
Switzerland, and the Netherlands -made heavy and continuous investment
in the industr ia Ii zati on of the
United States, and by 189?, there
were more than $3 billion of foreignowned assets.

A decade later, the

total had increased to $6 billion
and on the eve of florid flar I the
figure stood at almost $7 billion.
In the terms of today, $7 billion
does not seem very large, but let me

-

19

miles in 13 10;

-

1 3

^

steel production

increased in the same period from a
few thousand tons to 26 million
tons;

coal production increased

from 7 million tons to 502 million
tons;

manufactures increased in

value from $ I billion to $20
billion;

and the value of farm land

and buildings increased from $3.3
billion to $34.8 billion.
Concurrently with this expansion,
might be noted, our population
increased fourfold, to 92 million.

it

-

1 8 -

T

'v '^

sorely needed technical skills of
the highest order are brought into
the country.
Tne participation of foreign
capital

in the economic development

of the United States is a dramatic
cnapter in our history.
— -The last half of the nineteenth
century and the early years of the
twentieth were decades of tremendous
economic expansion in the United
States.

Railroad mileage increased

from 9,021 miles in I860 to 240,831

that private investment participate
in this economic development to
the maximum extent possible.
We in the United States
consider private foreign investment
as a highly desirable medium to
promote the economic development of
any country.

Foreign capital serves

the particular purpose of enabling
the country into which it flows to
obtain more essential

imports than

it could otherwise buy.

And it also

provides a channel through which

primarily to facilitate expansion of
the productive capacity of European
nations ravaged by the war.

The

InternationaI Bank for Reconstruct ion
and Development was established as an
internationaI

instrument to promote

the reconstruction and economic
development of the world.
0 11 is not enough, however, to
rely upon governmental or quasigovernmentaI

loans to expand the

productive and export capacity of
other countries.

it is essential

other countries to produce and to
export those goods and services for
wnich triey are best suited by reason
of tneir particular natural and
productive resources.
The Export-Import Bank of
Washington has long been a successful
instrument through which this
Government has helped finance
worthwhile development projects in
other countries.

The financial

assistance provideo under the
European Recovery Program is designed

practices.

We recently signed an

agreement in Havana for the
establishment of an InternationaI
Trade Organization designed to
promote equitable and nondiscriminatory treatment in
internationaI trade practices.

All

of these measures are highly
important and deserve our whole­
hearted support.
^ -----In addition to the foregoing,
it is necessary that measures be
taken to expand the capacity of

- 13 -

p!!f

suppI y.
A third important condition
is that we and other, nations work
toward the ei imination of artificial
barriers to world trade.

Since

1934, we have made great strides in
this direction through our program
of reciprocal trade agreements.

The

InternationaI Monetary Fund has been
established as a means of promoting
internationa I cooperation aimed
toward the removal of restrictive
and d iscr im inatory foreign exchange

internaliona I trade be brought into
a better balance at a high level of
trade.

How, then, are we to attain

this goal?
The first requirement is that
we maintain our present high levels
of economic activity.
<L—

Second, it is important that

we preserve essential natural
resources as far as possible and
that we also import adequate amounts
to supplement those stockpile
materials in which we are in short

i I

made it essential that the United
States Government extend loans and,
where necessary, grants to Europe,
thus aiding that continent to become
once more seIf-sustai n ing.

However,

it is neither possible nor desirable
for this Government to continue
indefinitely to finance the world’s
balance of payments deficit with
the United States.
— • Without any question,

it is

in the interests of the United States
and of every other country that our

10

III

currencies for much of its trade
surplus.

As a consequence, a very

large part of the Latin American
deficit with the United States has
had to be financed by heavy drawings
on the gold and dollar holdings

■

accumulated by Latin America during
the war.
It is clear that the pattern of
current world trade just summarized,
should not, and can not,
continued.

long be

Prevailing c ircumstances,

resulting largely from the war, have

3

13 g

|

America has experienced a substantial
trade deficit with the United
States, that deficit amounting to
$1.7 billion in 1947.
In part, Latin America's
postwar deficit with the United
States has been financed by dollars
received in payment for its surplus
with other countries.

In view of

the very limited dollar
availabilities of those countries,
however, Latin America has found
it necessary to accept inconvertible

-

8

-

composition of Latin
trade.

The United States acquired

32 per cent of Latin America’s
exports in
I

, as against 42 per

cent in 1947, while Latin America
obtained 32

cent of its imports

in 1938 from the United States, as
compared with over 75 per cent in
1947.
Before

war, the United

States normally imported more from
tin America than it exported to
that area.

Since the war, Latin

position of the Latin American
Republics appears to be much more
favorable than that of Western
Europe.

in 1938, Latin America had

a trade surplus with the world of
$229 million.

in 1946, that surplus

had grown to $1 billion.

Latin

America did not experience a trade
deficit even in 1947, a year during
which its imports were greatly
expanded.
However,

it is important to

look more carefully into the

-

6

-

n

1^

.

countries, shipping receipts, tourist
expenditures, and other invisible
exports.

But as a consequence of

the war, these sources of money
declined or shrank and the resulting
greater European trade deficit has
had to be financed in the post-war
period by liquidation of capital
assets and by various loans and
grants from countries in the
Western Hemisphere, and by the
expending of gold and dollar reserves
At first glance, the trade

- 5 -

7

^

these countries obtained 57 per cent
of the world's imports in 1938, they
obtained only 44 per cent in the
first half of 1947.

Significantly

therefore, the Western European
nations had a trade deficit of
approximately $8 billion for 1947
with the world, as compared to
$3.5 billion in 1938.
Before the war, the trade
deficit of Europe was financed
primarily by money received from
European investments in other

surplus of the United States with
all other countries was 20 times
that of 1938.■:.

'

The shifts in the trade
positions of other areas, such as
continental Europe and Latin America,
have been equally dramatic.
The nations taking part in the
European Recovery Program accounted
for 41 per cent of the world's
exports in 1938.

But, by the first

half of 1947, this figure dropped
to 27 per cent.

And, whereas

5
For example,

g I jg

in 1938, only

14 per cent of the world's exports
were from the United States.

But

by 1947, our exports had r isen to
almost 35 per cent of the world's
total figure.

It is important to

realize, however, that imports into
the United States did not increase
at anything like the rate of exports.
As a matter of fact, during this
same period, our share of world
imports increased only 3 per cent.
Thus, by 1947, the annual trade

2
have this opportunity to discuss
before your Forum some of the
problems of maintaining and expanding
the present levels of internationaI
trade.

#

Let me examine first the world
trade picture as it exists today.
Of necessity,

I shall have to use

some figures, but I shall try to
keep them to a minimum.
—

There have been highly

significant shifts in the sources
and flow of the world's exports.

Internat Iona I trade Is mankind's
most ancient and most effective way
to use the human and the natural
resources of the world for the
benefit of all nations.

The manner

in which we develop, employ, and
distribute the abundant resources
of the earth is the measure of the
security we may attain in our lives
and civi Iization.
— > I am accordingly delighted to

"AN EXPANDING WORLD TRADE the Primary Objective of
United States Foreign Economic Policy.
ADDRESS BY SECRETARY SNYDER
BEFORE
SECOND ANNUAL FOREIGN TRADE FORU
MIAMI. FLORIDA
MAY «>, 1948
27.

it

tm â S IJia r pÉPARTiraTT
E ash in g to n , E# G*

Mlo,Tâng
the
JPddress by S e cre ta ry , $nyder bafore/Seco :1 Annual: Foreign
ihac.e ¿‘priuù, oolur.ibus Hotel,^SLaitii, Florida, is scheduled ior
f /#!
. S ta n d a rd ;

'

„- a s t e r r.

Ti ne.

F rid ay , Lay 2 1 .

¡L2A.£ i an ¿_ir io r delivery- a t th a t tim o .)

• SKPAÎDII'IG T&E&D TRAES - THE PRIMARE" OBJECTIVE OF IRTI TRO STATES
FOREIGN 3C0NCMIC POLI 01»

TREASURY DEPARTMENT
Washington
(The following address by Secretary Snyder before the
Second Annual Foreign Trade Forum, Columbus Hotel, Miami,
Florida, is scheduled for delivery at 1 P« M» Eastern Standard
Timey Friday. Hay 21. 1948T and is for delivery at that time.)

«AN EXPANDING TJORLD TRADE ~ THE PRIMARY OBJECTIVE OF
UNITED STATES FOREIGN ECONOMIC POLICY«
International trade is mankind’s most ancient and most effective
•way to use the human and the natural resources of the world for the
benefit of all nations* The manner in which we develop, employ, and
distribute the abundant resources of the earth is the measure of the
security we may attain in our lives and civilization *
I am accordingly delighted to have this opportunity to discuss
before your Forum some of the problems of maintaining and expanding the
present levels of international trade.
Let me examine first the world trade picture as it exists today.
Of necessity, I shall have to use some figures, but I shall try to keep
them to a minimum.
There have been highly significant shifts in the sources and flow;
of the world’s exports, For example, in 1938, only 14 per cent of the
world’s exports were from tho United States. But by 1947, our exports
had risen to almost 35 per cent of the world’s total figure. It is
Important to realize, however, that imports into the United States did
not increase at anything like the rate of exports. As a matter of fact,
during this same period, our share of world imports increased only
3 per cent. Thus, by 1947, the annual trade surplus of the United States
with all other countries was 20 times that of 1938.
The shifts in the trade positions of other areas, such as continental
Europe and Latin America, have been equally dramatic,
The nations taking part in the European Recovery •Program accounted
for 41 per cent of the world’s exports in 1938. But, by the first half
of 1947, this figure dropped to 27 per cent, Arid, whereas these countries
obtained 57 per cent of the world’s imports in 1938, they obtained only
44 per cent in the first half of 1947, Significantly therefore, tho
Western European nations had a trade deficit of approximately
billion
for 1947 with the world, as compared to 03,5 billion in 1938,
Before the war, the trade deficit of Europe was financed primarily
by money received from European investments in other countries, shipping
receipts, tourist expenditures, and other invisible exports, But as a
consequence ef the war, these sources of monqy doclinqd or shrank and
the resulting greater European trade deficit has had to be financed in the
post-war period by liquidation of capital assets and by various loans and
grants from countries in tho Lest c m Hemisphere, and by the expending of
gold and dollar reserves,
S-732

-

2

-

At first glance, the trade position of the Latin American Republics
appears to bo much more favorable than that of Western Europe*. In 1938,
Latin America had a trade surplus vdth the world of £229 million* In
194^, that surplus had g r o w to £>1 billion* Latin America did not
experience a trade deficit even in 1947, a year during which its imports
were greatly expanded.
However, it is Important to look more carefully into the composition
of Latin America's trade. The United States acquired 32 per cent of
Latin America's exports in 1938, as against 42 per cent in 1947, vhile
Latin America obtained 32 per cent of its imports in 1938 from the
United States, as compared with over 75 per cent in 1947,
Before the war, the United States normally imported more from
Latin America than it exported to that area. Since the war, Latin America
has experienced a substantial trade deficit with the United States, that
deficit amounting to 01*7 billion in 1947,
In part, Latin America's postwar deficit with the United States has
been financed ty dollars received in payment for its surplus vdth other
countries* In view of the very limited dollar availabilities of those
countries, however, Latin America has found it necessary to accept
inconvertible currencies for much of its tra.de surplus. As a consequence,
a very largo part of the Latin American deficit with the United States
has had to bo financed by heavy drawings on the gold and dollar holdings
accumulated by Latin America during the war.
It is clear that the pattern of current world trade just summarized,
should not, and can not, long be continued. Prevailing circumstances,,
resulting largely from the war, have made it essential that the
United States Government extend loans and, where necessary, grants to
Europe, thus aiding that continent to become once more self-sustaining.
However, it is neither possible nor desirable for this Government to
continue indefinitely to finance the world's balance of payments deficit
vdth the United States.
Tiithout any question, it is in the interests of the United States
and of every other country that our international trade be brought into
a better balance at a high level of trade. Hov/, then, are we to attain
this goal?
The first requirement is that we maintain our present high levels
of economic activity.
Second, it is important that we preserve essential natural resources
as far as possible and that we also import adequate amounts to supplement
those stockpile materials in which we are in short supply*
A third important condition is that we and other nations work toward
the elimination of artificial barriers to world trade. Since 1934, we
have made great strides in this direction through our program of reciprocal
trade agreements. The International Lionetary Fund has been established
as a means of promoting international cooperation aimed toward tho removal
of restrictive and discriminatory foreign exchange practices.-' Tie recently

- 3 ~

signed an agreement in Havana for the establishment of an International
Trade Organization designed to promote equitable and nondiscriminatory'
treatment in international trade practices.' All of these measures arc
highly important and deserve our vdiolehearted support*
In addition to the foregoing, it is necessary that measures be­
taken to expand the capacity of other countries to produce and to export
thos o' goods and services for which ohey are best suited by reason ox
their particular natural and productive* resources .

The Export-Import Banlc of Washington has long been a successful^
instrument through which this Government has helped finance worthwhile
development projects in other countries. The financial assistance
provided under the European Recovery Program^as designed primarily to
facilitate expansion of the productive capacity of European nations
ravaged by the voir. The International Bank for Reconstruction and
Development was established as an international instrument to promote
the reconstruction and economic development of the world.

.

It is not enough, however, to roly upon governmental or quasigov orm e n t a l loans tc expand the productive and export capacity of other
countries. It is essential that private investment participate in this
economic development to the maximum extent possible.

Tie in the United States consider private^foreign investment as a
highly desirable medium tc promote the economic development - ■ any
country. Foreign capital serves the particular purpose cf enabling the
country into which it flows to obtain mere essential imports than it
could otherwise buy. And it also provides a channel through vhicn sorely
needed technical skills of the highest order are Drought into the country.
The participation of foreign capital in the economic development of
the United States is a dramatic chapter in our history*
The last half of the nineteenth century and the early years of the
twentieth were decades of tremendous economic expansion in the United States.
Railroad mileage increased from. 9,021 miles in 1850 to 240,831 miles in
1910: steel production increased in the same period from a few thousand
tons to 26 million tons,* coal production increased from 7 pillion tens to
502 million tons*; manufactures increased in value from <,¡>1 billion to My
billion: and the value of farm land and buildings increased iron y3.3
billion to 734.8 billion. Concurrently with this expansion, it might be
noted, our population increased fourfold, to 92 million.
The capital markets of Europe — particularly of Gr~at Britain, France,.
Switzerland! and the Netherlands — made heavy and continuous investment
in the industrialization of the United States, and by 1897, there werp
more than §3 billion of forcign-ewned assets, a decade, later, jfce total
had increased to 06 billion and on the eve of World War I the x i p r o stood
at almost $7 billion. In the terms of today, 77 billion docs not seen
very large but let me remind yon that from the standpoint oi the economy
of our country before World War I, this was a .v e r y substantial figure.

- A The diversity of the fields into which this foreign capital went
reads like a roster of our leading industries. In agriculture there
were numbers of land and cattle companies, and cotton plantations. In
rnining there were investments in well established companies, and scores
of ventures were financed in search of gold, silver, copper, iron,
petroleum, coal, and so forth. This foreign capital also found its way
into the steel mills, refineries, textile mills, insurance companies,
mortgages, all types of manufacturing companies, and an almost endless
list of other investments.
No wonder, in view of its role in our own economic expansion, we in
this country very n- tural'ly have a healthy respect for the speed and
efficiency rdth which private foreign capital can give vastly important
assistance in tho economic development of a nation.
There is an interesting angle to foreign investment of which we often
lose sight. During their early development, countries are considered to
be importers rather than exporters of capital. The truth is, however,
that at the very time when the inflow of foreign capital is at it a peak,
an outflow/- of capital starts as vigorous enterprises begin looking abroad
for investment opportunities. For example, when foreign investments in
the United States reached almost ,)7 billion in 1914, our assets in
foreign countries amounted to ,'-3*5 billion. Other countries go through
this same experience of exporting venture capital at the very time v/hen
their capital market must still seek strong outside aid.
Turning to the Tiostern Hemisphere,- the need for foreign capital
investment is particularly apparent, F t example, some of the
Latin American countries have huge petroleum reserves, some of which
resources have been untapped because the capital necessary to develop
them has not been available. The same situation is true with other
mineral resources*
Furthermore, capital is needed for establishing and expanding a
great many basic industries, for transportation and for agricultural
developments in certain of oho Latin American countries.
This unfortunate condition, the lack of capital for development, is
in part due to the financial status cf many Latin American countries
which in the 1930*s were compelled to reduce, and in sonic cases stop
entirely, the service of their external funded debt. Of course, this
situation today is considerably improved. However, this financial status
of some of the South American countries is not the only reason for the
lack of interest on the part of private investors. In many cases there
has also been the feeling that outside capital is not wanted*
The flow; of foreign p r iv a te capital into a country is governed almost
entirely by tho investors* estimate of the prospect for a reasonable return.
The average investor is prepared to take normal business risks. But
when he turns tc the foreign field he is easily discouraged by three
special risks: the risk of burdensome restrictions imposed on foroignow/nod enterprise; the risk of confiscation;. and the risk that
foreign-exchange restrictions may prevent him from freely converting the
currency he earns on his investment. Any country which hopes to attract

- 5 foreign capital can easily remove the first two cf these risks, To deal
v/ith the third is admittedly more difficult. The maintenance by the
United States of a high level of imports and exports will tend, however*
to eliminate the unbalanced conditions of international payments which in
turn give rise to burdensome exchange restrictions. Every country has the
right and the obligation, of course, to take such domestic measures as it
deems necessary for the welfare of its own nationals. It must, for example,
insist that for ci gn- own cd enterprises adhere to its laws on the same basis
as those donestically-cmncd. At the same' time, assurance of fair treatment
is essential before any foreign private capital will invest in a particular
country.
It is highly significant to note the constructive accomplishments of
the Ninth International Conference of American States recently concluded at
Bogota, Colombia, The Basic Agreement cf Inter-American Economic
Cooperation which vas signed at that Conference contains many provisions
Which should be a useful stimulus tc private foreign investment in Latin
America. The American States agreed, for example, that foreign capital
shall receive equitable treatment, They agreed that they would not take
unjustified, unreasonable or discriminatory measures which would injure the
legally acquired rights or interests cf nationals of other countries in the
enterprises, skills, capital, arts or technology which they have supplied.
They agreed that they would impose no unjustifiable restrictions upon the
withdrawal of the earnings on foreign investments or the repatriation of
those investments « They agreed to provide just and equitable treatment for
all personnel, national and foreign, employed in foreign-owned enterprises,
and to permit the employment of a reasonable number of technicians and
administrative personnel, regardless of nati nality.
The American States agreed further that they would individually seek,
within the framework cf their respective constitutions, to liberalize their
tax laws as they apply to income fr n foreign sources and tc avoid dis­
criminatory or unduly burdonsemo taxation. In this connection, the United
States Government is prepared to consider various possible revisions in its
tax laws in order V' facilitate the flow of international investment capital.
The Treasury continues to look with favor toward the negotiation of bilateral
tax treaties to reduce international double taxation of incomes. Our
Government is prepared to discuss such treaties with other governments and is
hopeful that much progress can bo made in such negotiations.
Our latin American neighbors may be confident that wo are sincerely
determined to take whatever reasonable and practical measures are within
our power in order to promote economic development and rising standards of
living in that area. We only ask that they, for their part, also do what
is reasonable and practical for the same objective,
I should like to mention one further agreement reached at Bogota,
namely that pertaining to the expropriation of foreign— owned investments.
It was generally agreed at Bogota that no American State will deprive
foreign enterprises or capital of legally acquired rights or property for
reasons, or under conditions different from those which the constitutions
and laws of the respective States provide for the expropriation of
nationally-owned enterprises or capital, ^Furthermore, any expropriation must
be accompanied by payments to the owners in a prompt, adequate, and
effective form*
Thus briefly, we have summarized sr>no of the morp significant problems
confronting world ora.de today, and we have considered seme of the steps
n e c e s s a r y to surmount those problems. The conclusion is clear c u t .

It is vital to the United States and tc the world that international
trade be maintained at the highest possible level. It is essential to
the economic and political 7*3If are cf every country. The prevalence
of large export markets make it possible to achieve rnrodmin productive
efficiency in many lines of activity in the United States, with high
levels of employment end income. The ability tc obtain from other
countries goods and services which they can produce at relatively low
costs or which can supplement goods and services unavailable in the
United States vdll enhance the productive efficiency of our industries
and will improve the standards ~f living of us all,
It has been, and is, the desire of the United States to help
deserving countries. But we must emphasize that rur resources have a
definite limitation. Moreover, vjq have incurred an enormous debt in
helping to prosecute the recent war. We have exhausted a substantial
part of some of our natural resources in the defeat of forces of
domination and destruction. !To arc continuing to assume huge obliga­
tions in order to promote world economic recovery and to put a stop to
aggression, whether direct or indirect. In all these efforts, we know
that we are acting in concert vdth these nations which arc making a
willing arid common contribution to the. development, strength, and
protection of free countries everywhere.
The patterns of growth of these nations must necessarily vary
greatly. But tho democratic principles which basically guido that
growth remain the sanc# TTe firmly believe in the essential dignity
and freedom of man. And wc must be sufficiently pro.ctical to sub­
ordinate any immediate differences to tho preservation of these beliefs.
I am convinced that tho cooperation which has c nspicu^usly narked ^ur
international relations will prove tc the world how sensible and how
profitable it is for nations to live in an atmosphere of friendship and
interdependent well-being.

TREASURY DEPARTMENT
Information Service

FOR IMMEDIATE RELEASE,
Monday, May 17, 1948.

WASHINGTON; D.C

No * S-733

Secretary Snyder, as Chairman, of the National Advisory
Council, today transmitted to. the President and-' to Congress a
special report on the results of ‘the operations of the Inter- national Bank:for Reconstruction and Development and the International Monetary Fund, since their inception in the spring of
1946. Such a report.vas called for by the Bretton Woods Agree­
ments Act which created the Council,
..
4.in its
report evaluating the operations of the Bank
and the Fund, the Council concludes that both Institutions
have^achieved notable progress in carrying out their objectives,
despite a post-war period characterised by economic and trade
dislocations and monetary and financio,! conditions which have
not been conducive to their most effective operation. The
Council states that the Bank will have an increasingly important
role in the future development and expansion of international
capital markets, while the Fund may be expected to make important
contributions toward maintaining conditions :-of international
economic stability which are vital to the well-being of the
united States,
••

The report discusses the principal problems which have faced
the t,w° International institutions and the policy of the United
btat.es with regard to these issues . In the case of the Fund
the two basic problems were the pattern of exchange rates for
the immediate post-war period and the use of the Fund's resources
during this period. Before action was taken by' the Fund the
uouncil gave careful consideration to- the problem :of the initial
cur:pencie s . It was in agreement with the decision
■
p
Fund in accepting the par.values proposed by the majority
of the countries, since.lt recognized that action taken in
December 1946 could at best be tentative,
believed that the time was not ripe for bringing
about some of the adjustments in exchange rates which would ul..r™^ ey ke required if the member countries were to carry on international trade without considerable external .assist—
_ace. It considers; that some adjustments must'“be .made in the
utupe, particularly in conjunction with American assistance
hn^er the. European Recovery Program.' The Fund provides a most
satisfactory means of dealing with this problem 'anti the Council
with°it n6d t0 Congress> Previously, its.proposal for dealing

2
T h e Council has also c o n s i s t e n t l y opposed the v i e w that
the m e m b e r countries h a v e an a u t o m a t i c right to the use of the
F u n d ' s r e s o u r c e s . ^ It h a s a p p r o v e d the F u n d ' s efforts to strike
a b a l a n c e between:7the e x treme of c o n s e r v i n g its res o u r c e s entirely
f or the p o s t - t r a n s i t i o n a l p e r i o d and the use of its r e s o urces at
this time to d e a l w i t h the p r e s s i n g e x c hange n e e d s of the members.
W i t h r e g a r d to the B a n k the Co u n c i l reports that it hasmad e a s i g n i f i c a n t c o n t r i b u t i o n t o ward w o r l d r e c o v e r y t h r o u g h
the e x t e n s i o n of loans a g g r e g a t i n g m o r e t h a n a h a l f b i l l i o n
d o l l a r s to m e m b e r countries.
The C o u n c i l h as a p p r o v e d the use of
the U n i t e d S t a t e s s u b s c r i p t i o n to the B a n k for m a k i n g loans, but
to enable, the B a n k to c a r r y on its operations, a.dditional funds
m u s t be. r a i s e d in the” A m e r i c a n capital market, since the U n i t e d
States is p r a c t i c a l l y the onl y c o u n t r y n o w in a p o s i t i o n to
p r o v i d e s u b s t a n t i a l a m ounts of finance for f o r e i g n investment.
The Co u n c i l has, therefore, a p p r o v e d the issue of securities by
the B a n k in the A m e r i c a n m a r k e t / It h as a s s i s t e d the B a n k in
s e c u r i n g r u l i n g s u n d e r e x i s t i n g law w h i c h w o u l d f a c i l i t a t e its
f i n a n c i n g o p e r a t i o n s , In this c o n n e c t i o n the C o u ncil h as r e c o m ­
mended to the Congress l e g i s l a t i o n w h i c h it b e l i e v e s w i l l be
c o n ducive to the s u c c e s s f u l f l o t a t i o n of a d d i t i o n a l securities
by the B a n k .
_
.
.
'
D u r i n g the first two y e a r s of Its operations, thé Bank's
loans w e r e m a d e p r i n c i p a l l y to E u r o p e a n countries to .enable
t h e m to carry out part of their r e c o n s t r u c t i o n p r o g r a m s .
The
C o u n c i l anticipates, that in t h e futu r e the B a n k w i l l m a k e a d ­
d i t i o n a l loans to E u r o p e a n c o u ntries b ut w i l l also devote, a
l a r g e r p o r t i o n of its re s o u r c e s to loans for the d e v e l o p m e n t of
non-European countries.
.The principal, f u n c t i o n of the N a t i o n a l A d v i s o r y C o u ncil is
to f o r m u l a t e the g e n e r a l p o l i c i e s . o f the U n i t e d Stat e s in the
f i e l d of i n t e r n a t i o n a l finance.
It a d v ises the U n i t e d States
r e p r e s e n t a t i v e s on the F u n d and the B a n k of the p o l i c i e s of this
g o v e r n m e n t ;and c o o r dinates t h eir a c t i v i t i e s w i t h those of all a g e n c i e s of the g o v e r n m e n t e n g a g e d in i n t e r n a t i o n a l loan, m o n e ­
tar y or f o r e i g n e x c h a n g e o perations.
The C o uncil is also charged
w i t h i m p o r t a n t r e s p o n s i b i l i t i e s in c o n n e c t i o n w i t h the E u r o p e a n
R e c o v e r y P r o g r a m and o t h e r aid pro g r a m s .
The C o u n c i l consists of the S e c r e t a r y of the T r e a s u r y as
Chairman, the S e c r e t a r y of State and the S e c r e t a r y of Commerce,
the C h a i r m a n .of the B o a r d of g o v e r n o r s of the F e d e r a l Re s e r v e
System, the C h a i r m a n o f .the B o a r d of D i r e c t o r s of the E x p o r t I m port B a n k of W a s h i n g t o n , and the A d m i n i s t r a t o r for E c o n o m i c
C o o p e r a t i o n for the t e r m of that p r o gram.
The Co u n c i l has given
c o n t i n u a l study to the fin a n c i a l p r o g r a m of t h e government, m e e t ­
i ng weekly, and m o r e ’’o f t e n w h e n necessary,, to deal w i t h problems
o f „ i m m e d i a t e urgency.
/
• *
•
'

0 O0

7 ^ f
We did a pioneering job with our Reciprocal Trade
Agreements Act and the agreements negotiated under it.
We contributed such aid as that of the Export-Import
Bank.

And now through the European Recovery Program

we have committed a large share of our resources to
the task of bringing Europe*s economies back to a
state of health and vigor.
We have met with discouragements, and probably
shall meet with more, but we have made oonaideratelo
gains.

They are gains toward enabling human enterprise

to function successfully in producing and exchanging
goods and services around the globe.

A perfected world

trade system is our best reliance for the establishment
of neighborliness between the earth’s peoples, and build­
ing a common prosperity.

That is our long-term objective.

This year1s World Trade Week finds most of the
nations engaged as never before in cooperative
efforts to solve the problems which stand in the way
of international neighborliness#

The public support

which these efforts have come to comman^Llnspire5
faith that in time they will succeed.
I think almost every country now realizes^
sharp, shortsighted practices in world trade^d*w#e*»
pap#

We realize that only through cooperation in

matters of world economics can we make the fullest
and most effective use of the material and human
resources of every country, and so raise the level
of prosperity for all#
This realization of the interdependence of
nations has brought about the creation of a framework
of institutions and codes to make cooperation work­
able#

The framework includes the United Nations, the

International Bank, the International Monetary Fund,
the charter of the proposed International Trade
Organization, and the General Agreement on Tariffs
and Trade negotiated among 23 nations at Geneva last
year#

for r e l e a s e PMs M a y 19

Cooperation between nations has

scored constructive

g a i n s t o w a r d a p e r f e c t e d w o r l d trade system* w i t h its
p r o m i s e of a p r o s p e r i t y c o m m o n to all peoples,
S n y d e r said t o d a y in a W o r l d T r ade W e e k
c o m m e n t s follow:

Secretary

statement*

His

t r e a s u r y

d e p a r t m e n t

Information Service

Wa s h in g t o n , d .c .

FOR RELEASE, A F T E R N O O N N E W S P A P E R S
Wednesday, M a y 19, 19^8

C o o p e r a t i o n b e t w e e n nations has scored
toward a p e r f e c t e d w o r l d trade system, w i t h
p r o s p e r i t y c o m m o n to all peoples, S e c r e t a r y
a W o r l d T r ade W e e k statement.
H is comments

^
^°*

^

const r u c t i v e gains
its p r o m i s e of a
S n y d e r said t o d a y in
follow*.'

This year's W o r l d Trade W e e k finds m o s t of the
n a t i o n s e n g a g e d as n e v e r before in coop e r a t i v e efforts
to solve the pr o b l e m s w h i c h ^stand in the w a y of i n t e r ­
national neighborliness.
The p u b l i c support w h i c h
these efforts h ave come to command inspires f a i t h that
in time the y w i l l succeed.
I t h i n k almost e v ery country n o w realizes the
f u t i l i t y of sharp, s h o r t s i g h t e d p r a c t i c e s in w o r l d
trade.
W e realize that only th r o u g h c o o p e r a t i o n in
m a t t e r s of w o r l d economics can we m a k e the fullest
and m o s t e f f e ctive use of the m a t e r i a l and h u m a n
r e s ources of e v ery country, and so raise the level
of p r o s p e r i t y for all.
This r e a l i z a t i o n of the i n t e r d e p e n d e n c e of n a t ions
has b r o u g h t about the c r e a t i o n of a f r a m e w o r k of i n s t i ­
tutions and codes to m a k e c o o p e r a t i o n w o r k a b l e . The
f r a m e w o r k includes the U n i t e d Nations, the I n t e r n a t i o n a l
Bank, the Internationa,! "Monetary Fund, the c h a r t e r of
the p r o p o s e d I n t e r n a t i o n a l Trade O r g a n ization, and the
G e n e r a l A g r e e m e n t on Tariffs and Trade n e g o t i a t e d a m o n g
2 3 na t i o n s at G e n e v a last year.
W e d i d a p i o n e e r i n g job w i t h our R e c i p r o c a l T r ade
A g r e e m e n t s Pet and the agreements n e g o t i a t e d u n d e r
it.
W q c o n t r i b u t e d such aid as that of the Ex p o r t Import Bank.
A n d n o w t h r o u g h the E u r o p e a n R e c o v e r y
P r o g r a m we h a v e com m i t t e d a large share of our
resources to the t a s k of b r i n g i n g E u r o p e ' s e c o n o m i e s
b a c k to a state of h e a l t h and vigor.
W e h a v e m e t w i t h discour a g e m e n t s , and p r o b a b l y
shall m e e t w i t h more, but we hav e m a d e c o n s t ructive
g a i n s . T h e y are gains toward e n a b l i n g h u m a n e n t e r ­
p r ise to f u n c t i o n s u c c e s s f u l l y in p r o d u c i n g and e x ­
ch a n g i n g goods and services a r ound the g l o b e , A
p e r f e c t e d w o r l d trade s y s t e m is our best r e l i a n c e
1 for the e s t a b l i s h m e n t of n e i g h b o r l i n e s s b e t w e e n the
earth's p e o p l e s , - a n d b u i l d i n g a c o m m o n p r o s p e r i t y .
That is our l o n g - t e r m objective,
0 O0

TREASURY DEPARTMENT

T H E

T R E A S U R Y

C A L E N D A R

Scheduled Departmental Activities
W E E K OP M A Y 17 - 22,

OFFICE OF THE SECRETARY

1

1948

Pennsylvania Bankers Association, Traymore Hotel, Atlantic City, New Jersey*

Thursday« May 20. Secretary Snyder will
go to Philadelphia as a member of the
official group accompanying President
Truman, who will deliver an address at
Girard College.

I
OFFICE OF THE GENERAL COUNSEL
»inn.--.H"
I
: Wednesday, May 19. 10 A.M. Paul McDonald
Director of Administrative 'Services, and
Stewart Berkshire, Assistant Director of
Friday. May 21. 10 A.M.
.
Press conference in the Secretary’s suite Internal Revenue, will testify before
the sub-committee on Public Buildings
at the Columbus Hotel, Miami, Florida.
and Grounds of the House Committee ®n
May 21« 1 P.M. Speech before the Second
Public Works, on HR 6328 and HR 6332,
authorizing Public Buildings Administra­
Annual Foreign Trade Forum, Roof Garden,
tion to lease to the Temple Methodist
Columbus Hotel, Miami, Subject: ”An
Church that portion of the Federal buildExpanding World Trade - the Primary Ob­
jective of United States Foreign Economic ' ing in San Francisco which was previously
Policy. ”
| occupied by that church and now utilized
I by the Office of the Collector of In{ terna,! Revenue.
4
OFFICE OF THE TINDER SECRETARY

BUREAU OF INTERNAL REVENUE
Saturday. May 22« 8 P.Mo Under Secretary
^•ggins will deliver an unprepared afterjWednesday, May 19. 7:30 P.M* Commis­
dinner speech before a group of Eastern
sioner George Schoeneman and Chief
corporation executives at Skytop,
Counsel Charles Oliphant will be honored
Pennsylvania. Subject of speech not an­
nounced.
guests at the Annual Dinner of the Tax
Executives Institute, Waldorf-Astoria
THotel, New York City.
COMPTROLLER OF THE CURRENCY
.Week of May 17* Representatives of the
Ügdnesday. Thursday. Friday, May 19. 20, ^Netherlands Government will confer with
J. L. Robertson, Deputy Comptroller, .officials of Internal Revenue on details
Hof administering the United Statesm attendance at the annual meeting of

- 2
Netherlands Tax Convention, which is now
pending. Eldon P. King, Special Deputy
Commissioner, and others are represent­
ing Internal Revenue.

Savings Bond Division, will be in Iowa
and Illinois making a survey of the Se­
curity Loan Drive.

UNITED STATES COAST GUARD
BUREAU OF CUSTOMS
Tuesday. May IS. 10 A.M# Commissioner
Dow, Budget Officer Strubinger, and Assistant Deputy Commissioner Higman appeared before the Senate Appropriations
Committee on the Customs budget.

Thursday. May 20. Commander F. A.
Erickson, Off icer-in-Charge of the Rotary
J Wing Development Project, Elizabeth City,
f North Carolina, will present a paper on
I »Coast Guard Rotary Wing Development
Progress Report» to the NACA Helicopter
Sub-Committee Meeting in Washington, D.C,

Tnesday-Frlday, May 18, 19, 20, 21, Rear
Admirals W, N. Derby, Superintendent of
Tuesday, Wednesday. Thursday. May IS. 19« | the Coast Guard Academy; J* E. Stika,
20. Leon Markham, Director of Sales,
| Commandant, 13th Coast Guard District;
E. H. Smith, Commandant, 3rd District;
Savings Bond Division, will be in New
York and Philadelphia making a survey of | and W. K. Scammell, Commandant, 12th
District, attending Coast Guard board
the Security Loan Drive,
meeting in Washington to consider officer
Wednesday. Thursday. Friday, May 19. 20» | personnel matters.
21, Vernon L. Clark, National Director, f
DIVISION OF SAVINGS BONDS

f

I
f

W E E K OF M A Y 24 - 29,

1 9^8

| Thursday. May 27. Secretary Snyder will
be present at a party honoring W. T*
Monday. May 2A, 10..A.M, Press Conference I Sherwood, retiring Assistant Commissioner
in the Secretary's suite, Traymore Hotel, f of Internal Revenue. (Hour and location
Atlantic City, New Jersey,
f not announced.)
OFFICE OF THE SECRETARY

I Friday. May 2 8 , 11 A ,M . The Secretary
| will attend a ceremony at the White House
1 in regard to the issuance of a postage
I stamp commemorating the heroism of the
| four chaplains who gave up their lives
f in the sinking of the Dorchester.
|
Other Scheduled Speeches
Wednesday, May 26. 3 P.M, The Secretary f
will assist President Truman in receiving | Friday. June A, Secretary Snyder will
disabled veterans who attend White House I deliver the commencement address at
garden party.
A the U. S. Coast Guard Academy, New
London, Connecticut.

Monday. May 2A. Speech by the Secretary
before the Annual Conference1of the National Association of Mutual Savings
Banks, American Room, Hotel Traymore,
Atlantic City, Mew Jersey. Subject:
»Mutual Savings Banks and the Public '
Debt.»
r

- 3

OFFICE OF THE SECRETARY
(Continued)
Other Scheduled Speeches
September 22. Speech before the an­
nual meeting of the National Associa­
tion of Supervisors of State Banks,
Louisville, Kentucky.

OFFICE OF THE UNDER SECRETARY
Wednesday. May 26. 10 A.M. Under Secre­
tary Yiiggins will deliver an unprepared
speech before the National Industrial
Conference Board, Waldorf-Astoria Hotel,
New York City.

OFFICE OF THE GENERAL COUNSEL
Date Indefinite. Director of Federal
Supply Clifton E. Mack, and Stephen J.
Spingarn, Deputy Director of Contract

Settlement;», will appear before the House
Expenditures Committee in connection with
proposed legislation to transfer the
Bureau of Federal Supply and the Office
of Contract Settlement to the Federal
Works Agency,

COMPTROLLER OF THE CURRENCY
%
Monday. Tuesday. Wednesday. May 24. 25,
26, Preston Delano, Comptroller of the
Currency, villi, attend the National Asso
ciation of Mutual Savings Banks, Hotel
Traymore, Atlantic City, New Jersey.

OFFICE OF TAX LEGISLATIVE COUNSEL
Monday. May 24. 7:30 P.M» Speech by
Adrian W. DeWind, Tax Legislative Counsel,
before Practicing Law Institute, New York
County Lawyers Association Building, New
York City. Subject: »Current Proposals
for Tax Reduction.»

■1, 1 1IB® iSJBi i 'ISS i|'-A

NOTE:

Items for the Treasury Calendar may be phoned to the Information

Service over extensions 2040-2041-2668; Internal Revenue extensions 650651; Bureau of Federal Supply extension 457; Coast Guard, Treasury ext­
ension 2993«

•HfKASÜKT S H S S ßSKt
Waahlngton
Frees Sexviee

W m HKUSAS*/»Ritti» 82® « * ,
Tn— a»y, jH I 1B . XWB.-----------

jS

- 7

3 3

fhs seeretary ©f tfcm Treasury announeed last erening that th* tendere for
#1,000,000,000, ©r thereabouta, ef 91-day Treasury bilie to be dated May 20 and to »aturt
August 19, 1943, whieh w e m offered May 14, 1948, w e m opened at ths Federal Reserve
Baaks on Kay 17«
The deteils of thls iseus are es foilows:
fetal applied for - |1,648,667,000
Total aeeepted
- 1,008,841,000 (iaeludee #48,843,000 eatered ©a a ncmcompetitive basis and aeeepted in full at the average pi«®
fißOWB eelov]
Average priee
- pf.748 Äquivalent rate of discount approx. 0.997f per aasm
Range of aeeepted eompetitive bidè:

mg*

- 99*732 Equivalent rate of dlaeouat approx. 0.98lg per «ans
- 99.747
«
•
*
“
i.001# «
«

Lo T

(83 pereeat of the aaouat bid for at tbe low priee was aeeepted)

Federal Reserve
Dlatrlet

Total
Applied for

Total
Aeeepted

Boston
Hew York
Philadelphia
Cleveland
Riehaond
Atlanta
Chieago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco

#

#

TOTAL

13,873,000
1,383,772,000
23.333.000
83.017.000
3.135.000
7.001.000
79.903.000
2.903.000
3.148.000
80.743.000
3.880.000
70.538.000

#1,348,337,000

12,903,000
843,328,000
8.307.000
13.841.000
5.135.000
5.321.000
58.377.000
2.905.000
2.734.000
12.975.000
6.720.000
35.038.000

#1,003,841,000

RELEASE M O R N I N G N E W S P A P E R S
Tuesday, M a y 18, 1948.

N o . S-735

The S e c r e t a r y of the Tr e a s u r y a n n o u n c e d last e v e n i n g that
the tenders for $1,000,000,000, or thereabouts, of 9 1 - d a y
Treasury bills to be d a ted M a y 20 and to m a t u r e A u g u s t 1 9 , 1948,
which wer e o f f e r e d M a y 14, 1948, were opened at the F e d e r a l
Reserve B a n k s on M a y 1 7 .
The d e tails

of this issue are as follows;

Total a p p l i e d for - $ 1 , 6 4 2 , 6 6 7 ,000
Total a c c e p t e d
1 , 0 0 3 , 8 4 1 , 0 0 0 (includes $ 4 2 , 2 4 3 , 0 0 0 en t e r e d
on a n o n - c o m p e t i t i v e basis and a c c e p t e d in
full at the average price shown below)
Average p r ice

- 9 9 * 7 4 8 E q u i v . rate of di s c o u n t approx.
annum

0 .9 9 7 $ p e r

Range of a c c e p t e d competitive bids:
High - 9 9 * 7 5 2 Equiv.
Low
- 99.747
”

rate of di s c o u n t approx.
M
"
"•
n

0 .9 8 1 $ p er a n n u m
1.001$
n
M

(26 p e r c e n t of the amount bid for at the low price was accepted)

Federal R e s e r v e
District_______

Total
Total
A p p l i e d for______A c c e p t e d

$

Boston
New Y o r k
P h i l adelphia
Cleveland
Richmond
Atlanta
Chicago
S t . Louis
Minneapolis
Kansas City
Dallas
San F r a n c i s c o
TOTAL

1 3 , 276,000
1 , 3 8 6 , 772,000

$

1 2 ,9 0 6 ,0 0 0
845,322,000

8 ,307,000

23.355.000
23.017.000
5 ,1 6 5 , 0 0 0
7,0 0 1 , 0 0 0
79.905.000
2 ,9 0 5 ,0 0 0
3 . 1 48.000
20.745.000
6 .8 2 0 .0 0 0
70.558.000

13.841.000
5.165.000
5 .5 2 1 . 0 0 0
52.377.000
2 ,9 0 5 ,0 0 0
2.764.000
12.975.000
6 .7 2 0 .0 0 0
35.038.000

$1,642,667,000

$1,003,841,000

0O0

T R E A S U R Y DE
Information Service

FOR RELEASE, MORNING NEiiSP.
Wednesday, May 19 3 19US.

S ecretary of the Trea
Federal Reserve Banks, of ]
of S e rie s E-19 u9 j open on
....... . ^
^
holders of 7 /8 percent Treasury C e r tific a te s of Indebtedness of S e rie s S —19U8^
maturing June 1, 191+8, in the amount of $l,f?7?ill4.2*QOG, or 1-3/U percent Treasury ‘
Bonds of 19U8, maturing June l £ , 19U8, in the amount of $3^06l,85>li 5>P0. Ex­
changes w ill be made par fo r par in the case of the maturing c e r t i f i c a t e s , and
at par with an adjustment of in te r e s t as of June 1?, I 9I4.8 , in the case of the
'maturing bonds.
The c e r t i f i c a t e s now offered w ill be dated June 1, I 9I4.8, and w ill bear
in te re s t from th a t date a t the ra te of one and one-eighth percent per annum, pay­
able with the p rin c ip a l a t m aturity on June 1, 19U9. They w ill be issued in
bearer form only, in denominations of $ 1 ,0 0 0 , $5>,000, $ 1 0,000, $100,000 and
$1 ,000,000.

Pursuant to the provisions of the Public Debt Act of I 9I4I 5 as amended,
in te r e s t upon the c e r t i f i c a t e s now Offered s h a ll not have any exemption, as such,
under the In te rn a l Revenue. Code, or laws amendatory or supplementary th e re to .
The f u l l provisions r e la tin g to ta x a b ility are se t fo rth in the o f f i c i a l c ir c u la r
released today.
Subscriptions w ill be received a t the Federal Reserve Banks and Branches,
and a t the Treasury Department, Washington, and should be accompanied by a lik e
face amount of the s e c u r itie s to be exchanged and, where maturing bonds in coupon
form are presented, by payment of accrued in te r e s t on the new c e r t i f i c a t e s a t the
rate of $G*i>31!?1 per $1,000, since in these cases in te r e s t i s to be adjusted as
of June 15, 19U8. Su bject to the usual reserv a tio n s, a l l su b scrip tio n s w ill be
a llo tte d in f u l l .
The su b scrip tio n books w ill clo se a t the clo se of business Friday, May 21,
except fo r the re c e ip t of su bscrip tions from holders of $2^,000 or le s s of the
maturing bonds. The su bscrip tio n books w ill clo se fo r the r e c e ip t of subscrip­
tion s of the l a t t e r class- a t the clo se of business Tuesday, May 25>.
Su bscriptions addressed to a Federal Reserve Bank or Branch or to the Treas­
ury Department, and placed in the m ail before midnight of the resp ectiv e clo sin g
days, w ill be considered as having been entered before the clo se of the su bscrip­
tio n books.
The, text of the official circular follows:

J

T R E A S U R Y DmE P A R T M E N T
Information Service

WASHINGTON, D .C.

FOR RELEASE, MORNING NEWSPAPERS,
Wednesday, May 19, 191+8.

Secretary of the Treasury Snyder today announced the offering, through the
Federal Reserve Banks, of 1-1/8 percent Treasury Certificates of Indebtedness,
of Series E-19Ù9, open on an exchange basis, in authorized denominations, to
holders of 7/8 percent Treasury Certificates of Indebtedness of Series E-I 9I48,
maturing June 1, 191+8, in the amount of $1,777,11+2,000, or 1-3/1+ percent Treasury
Bonds of 191+8, maturing June 15, 191+8, in the amount of $3,061,851,500. Ex­
changes will be made par.for par in the case of the maturing certificates, and
at par with an adjustment of interest as of June 15, 191+8, in the case ,of the
'maturing bonds.
The certificates now offered will be dated June 1, 191+8, and will bear
interest from that date at the rate of one and one-eighth percent per annum, pay­
able with the principal at maturity on June 1, 191+9. They will be issued in
bearer form only, in denominations of $1,000, $5,000, $10,000, $100,000 and
$1,000,000.
Pursuant to the provisions of the Public Debt Act of 191+1, as amended,
interest upon the certificates now Offered shall not have any exemption, as such,
under the Internal Revenue. Code, or laws amendatory or supplementary thereto.
The full provisions relating to taxability are set forth in the official circular
released today.
Subscriptions will be received at the Federal Reserve Banks and Branches,
and at the Treasury Department, Washington, and. should be accompanied by a like
face amount of the securities to be exchanged and, where maturing bonds in coupon
form are presented, by payment of accrued interest on the new certificates at the
rate of $Q.)+3l5l per $1,000, since in these cases interest is to be adjusted as
of June l5, 191+8. Subject to the usual reservations, all subscriptions will be
allotted in full.
The subscription books will close at the close of business Friday, May 21,
except for the receipt of subscriptions from holders of $ 25,000 or less of the
maturing bonds. The subscription books will close for the receipt of subscrip­
tions of the latter class-at the close of business Tuesday, May 25.
Subscriptions addressed to a Federal Reserve Bank or Branch or to the Treas­
ury Department, and placed in the mail before midnight of the respective closing
days, will be considered as having been entered before the close of the subscrip­
tion books.
The. text of the official circular follows:

UNITED STATES OF AMERICA
1-1/8 PERCENT TREASURY CERTIFICATES OF INDEBTEDNESS OF SERIES E-19U9
Due June 1, 191*9

Dated and bearing interest from June 1, 191*8

TREASURY DEPARTMENT,
Office of the Secretary,
Washington, May 19* 19l*8.

191*8Department Circular No. 827
Fiscal Service
Bureau of the Public Debt
I.

OFFERING OF CERTIFICATES

1. The Secretary of the Treasury, pursuant to the authority of the Second
Liberty Bond Act, as amended, invites subscriptions from the people of the United
States for certificates of indebtedness of the United States, designated 1-1/8
percent Treasury Certificates of Indebtedness of Series E-19U9, in exchange for
7/8 percent Treasury Certificates of Indebtedness of Series E-19i*8, maturing
June 1, 191*8, or 1-3/1* percent Treasury Bonds of 191*8, maturing June 15, 191*8.
Exchanges will be made par for par in the case of the maturing certificates, and
at par with an adjustment of interest as of June 15, 191*8, in the case of the .
maturing bonds.
II.

DESCRIPTION OF CERTIFICATES

1. The certificates will be dated June 1, 191*8, and will bear interest from
that date at the rate of l-l/8 percent per annum, payable with the principal at
maturity on June 1, 191*9. They Will not be subject to call for redemption prior
to maturity.
2. The income derived from the certificates shall be subject to all taxes,
now or hereafter imposed under the Internal Revenue Code, or laws amendatory or
supplementary thereto. The certificates shall be subject to estate, inheritance,
gift or other excise taxes, whether Federal or State, but shall be 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.
3. The certificates will be acceptable to secure deposits of public moneys.
They will not be acceptable in payment of taxes.
i*. Bearer certificates will be issued in denominations of ¿1,000, $5,000,
$10 ,060, $100,000 and $1,000,000. The certificates will not be issued in regis­
tered form.
5- The certificates will be subject to the general regulations of the Treas
ury Department, now or hereafter prescribed, governing United States certificates
III.

SUBSCRIPTION AND ALLOTMENT

1. Subscriptions will be received at the Federal Reserve Banks and Branches
and at the Treasury Department, Washington. Banking institutions generally may

submit subscriptions for account of customers, but only the Federal Reserve Banks
and the Treasury Department are authorized to act as official agencies.
2. The Secretary of the Treasury reserves the right to reject any subscrip­
tion, in whole or in part, to allot less than the amount of certificates applied
for, and to close the books as to any or all subscriptions at any time without
notice; and any action he may take in these respects shall be final. Subject to
these reservations, all subscriptions will be allotted in full. -Allotment notices
will be sent out promptly upon allotment.
IV.

PAYMENT

1. Payment for certificates allotted hereunder must be made on or before
June 1, 19U8, or on later allotment. Payment of the principal amount may be made
only in Treasury Certificates of Indebtedness of Series E-I 9I4.8 , maturing June 1,
I9I48, or in Treasury Bonds of 19U8, maturing June 1$, 19U3, which will be accepted
at par and should accompany the subscription. The full year's interest on the
certificates surrendered will be paid to the subscriber following acceptance of
the certificates. In the case of the maturing bonds in coupon form, payment of
accrued interest on the new certificates from June 1, I9I4.8 to June 15>, 19)18
($0.if315>l per $ 1 ,000 ). should be made when the subscription is tendered. In the
case of maturing registered bonds, the accrued interest wi 1 1 be deducted from the
amount of the check which will be issued in payment of final interest on the bonds
surrendered. Final interest due June 1$ on bonds surrendered will be paid, in the
case of coupon bonds, by payment of June 15>, 19h8 coupons, which should be detached
by holders before presentation of the bonds, and in the case of registered bonds,
by checks drawn in accordance with the assignments on the bonds surrendered.
V.

ASSIGNMENT OF REGISTERED BONDS

1. Treasury Bonds of I9I48 in registered form tendered in payment for certifi­
cates offered hereunder should be assigned by the registered payees or assignees
thereof to nThe Secretary of the Treasury for exchange for Treasury Certificates of
Indebtedness of Series E-19U9 to be delivered to
,n in accordance
with the general regulations of the Treasury Department governing assignments for
transfer or exchange, and thereafter should -be presented and surrendered with the
subscription to a Federal Reserve Bank or Branch or to the Treasury Department,
Division of Loans and Currency, Washington, D. C. The bonds must be delivered at
the expense and risk of the holders.
VI.

GENERAL PROVISIONS

1. As fiscal agents of the United States, Federal Reserve Banks are author­
ized and requested to receive subscriptions, to make allotments on the basis and
UP to the amounts indicated by the Secretary of the Treasury to the Federal Re­
serve Banks of the respective Districts, to issue allotment notices, to receive
Payment for certificates allotted, to make delivery of certificates on full-paid

- 3 -

sucscriptions allotted/ and they may issue interim receipts pending delivery of
the definitive certificates.

2. The Secretary of the Treasury may at any time, ®r from time to time,
prescribe supplemental or amendatory rules and regulations governing the offer­
ing, which will be communicated promptly to the Federal Reserve Banks.

JOHN W. SNIDER,
Secretary of the Treasury.

Encouraging price n e w ha« reached the treasury*
Distinctive paper to he used In printing currency and public
debt securities will not cost any more for the fiscal year
19^9 than for the current year*
A bid received from the Crane Co* of Dalton, Mass.,

■ §8 |..Ill

•

;

.•

the only concern which manufactures the distinctive paper,
quotes the same price as that paid the company for the
Treasury*s fiscal

supply*

The estimated quantity of the paper to be required
during fiscal ***9 Is 116,300,000 sheets, or about ltkck
tons, for currency

and 10 ,1 7 5 *00° sheets, or about 190 tons,

for public debt securities*
From one sheet of distinctive paper, 12 pieces of
paper currency are printed. The overman cost of manufacturing
paper currency is now about 9 mills per piece, regardless
of denomination*

TREASURY DEPARTMENT
Information Service

WASHINGTON, D .C.

RELEASE, HORNING NEWSPAPERS

No. 3-737

Thursday» May 20, 1948

Encouraging price news has reached the Treasury,,

Distinctive

paper to be used in printing currency and public debt securities m i l
not cost any more for the fiscal year 1949 than for the current year,
A bid received from the Crane Co. of Dalton.'Hass,

the only

concern vidch manufactures the distinctive paper, quotes the same
price as that paid the company for the Treasury’s fiscal *48 supply.
The estimated quantity of the paper to be required during
fiscal *49 is 116,300,000 sheets, or about 1,404 tons, for currency and
10,175,000 sheets, or about 190 tons, for public debt securities,

'

From one sheet of distinctive paper, 12 pieces of paper currency
are, printed.

The over-all cost of manufacturing paper currency is now

about 9 mills per piece, regardless of denomination.

oOo

•The Increased duty-free exemption will make foreign
travel more attractive to Americans» and will permit them
to acquire abroad more of the products of forel^i skills
which they can bring hade as tangible mementoes o f their
trips*
•Foreign travel is itself a kind of world trade»
involving not only material things but also» in special
measure» ideas» understanding and mutual respect**
The Bureau of Customs

is notifying the Collectors of

all ports to put the new law into effect immediately*

V . -5Secretary Snyder today called at teat Ion to the
provisions of a new law# Just signed by President Truman#
Increasing the duty-free exemption allowed to Americana
returning from visits to foreign countries*
In addition to the exemption idiioh has prevailed for
more tlian 50 years# allowing a returning traveler to bring
in free of duty merchandise purchased abroad for personal use
up to the value of $100# there is now authorised a further
exemption of tJOO once In six months fbr persons returning
from trips abroad of 12 days or more duration*
It is particularly appropriate# Secretary Snyder
pointed out# that the new bill should become law during
World Trade Week.
»There have always been a great many Americans who
visited foreign lands for pleasure# for business and for
education#» the Secretary said*
»Such travel has been of great value to our country
and to foreign countries by providing opportunities for
our people to meet those of other countries face to face*
It assume#

a special importance today

because the dollars

Americans spend abroad constitute# In the technical language of
the economists# 'Invisible exports1 from those countries
to the Uhl ted States# which Increase the dollar earnings of
foreign countries and facilitate their purchase of teerlean
goods*

treasury department
Information Service

WASHINGTON,

F OR I M M E D I A T E R E L E A S E
T h u r s d a y , M a y 2 0 A 1 9 4,8 «

No . S-73‘8

S e c r e t a r y S n yder today c a l l e d a t t e n t i o n to the p r o v i s i o n s
of a . n e w law,' just signed by P r e sident Truman, i n c r e a s i n g
the d u t y - f r e e e x e m p t i o n a l l o w e d to A m e r i c a n s r e t u r n i n g f rom
visits to f o r e i g n countries.
In a d d i t i o n to the e x e m p t i o n w h i c h has p r e v a i l e d for
m o r e tha n 50 years, a l l o w i n g a r e t u r n i n g tra v e l e r to b r i n g
in free of d u t y m e r c h a n d i s e p u r c h a s e d a b road for p e r s o n a l
use up to the value of $100, there is n o w a u t h o r i z e d a f u r t h e r
e x e m p t i o n of $300 once in six m o n t h s f or persons r e t u r n i n g
f r o m trips abroad of 12 days or mor e duration.
It is p a r t i c u l a r l y appropriate, S e c r e t a r y S n y d e r p o i n t e d
out, that the n e w bil l should become law d u r i n g W o r l d Trade
Week.
"There h a v e always b e e n a great m a n y A m e r i c a n s who
v i s i t e d f o r e i g n lands for pleasure, for b u s i n e s s and for
educ a t i o n , " the S e c r e t a r y said.
"Such t r a v e l - h a s b e e n of great value to our c o u n t r y and
to f o r e i g n c o u n t r i e s by p r o v i d i n g o p p o r t u n i t i e s for our peop l e
to m e e t those of other countries face to face.
It assumes
a special i m p o rtance today because the d o l lars A m e r i c a n s
spend a b road constitute, in the technical language of the
economists, 'invisible e x p o r t s 1 f rom those countries to the
U n i t e d States, w h i c h increase the d o l l a r earnings of f o r e i g n
countries and fac i l i t a t e their p u r c h a s e •of A m e r i c a n goods.
"The i n c r e a s e d dut y - f r e e e x e m p t i o n w i l l mak e f o r e i g n
travel m o r e a t t r a c t i v e to Americans, and wil l p e r m i t the m
to a c q uire abroad more of the produ c t s 'of f o r e i g n skills w h i c h
t h e y c a n b r i n g b a c k as tangible m e m e n t o e s of their trips.
"Foreign t r a v e l is it self a kind of w o r l d trade, i n v o l v ­
ing not onl y m a t e r i a l t h i n g s 'but also, in special measure,
ideas, u n d e r s t a n d i n g and m u t u a l respect."
The B u r e a u of Customs is n o t i f y i n g the C ollectors .of all
ports to p ut the n e w law into effect immediately,

0 O0

-3 of taxation the amount of discount at Which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections U2 and

117 (a) (1) of the Internal Revenue Code, as amended by Section 115> of the Reve­
nue Act of I 9I4.I, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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. J4I 8 , as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

kllwili

M

- 2 -

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 ?;ill be opened at the Federal
Reserve Banks and Branches, following which public announcement will be made by
the Secretary of the Treasury of the amount and price range of accepted bidg.
Those submitting tenders Yri.ll 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 Yirhole 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 Yri-thout 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 Yri.th the bids must be made or completed at the
Federal Reserve Bank on

May 27, 19lt3

, in cash or other immediately avail-

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders

yj± 11

receive equal treatment.

May 27» 19li8

Cash adjustments

yo.11

be

made for differences between the par value of maturing bills accepted in exchange
and the issue price of the neYr bills.
The income derived from Treasury bills, whether interest or gain from the sale
or other disposition of the bills, shall not have ary exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, whether Federal or State, but shall be exempt from all taxation now or
hereafter imposed on the principal or interest thereof by any State, or aiy of the
possessions of the United States, or by any local taxing authority.

For purposes

'

■
,|1 ,
t :1 1

v-

§1 s |||

TREASURY DEPARTMENT
Washington

FOE RELEASE, MORNING NEWSPAPERS,
Friday, May 21, 1 9 U 8 . ________

% ' 7 3 r

5pg

The Secretary of the Treasury, by this public* notice, invites tenders for

$ 1 ,10 0 , OCX),000 , or thereabouts, of
91 -day Treasury bills, for cash and
------m -----~ w ~
in exchange for Treasury bills maturing
May 27, 191+8 ___ , to be issued cn
\
w ' .
a discount basis under competitive and non-competitive bidding as hereinafter
provided.

The bills of this series will be dated

will
Igi mature ! August 26. 191x8
interest.

May 2?, 19l$

, and

, when the face amount will be payable without

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
daylight saving
closing hour, two o ’clock p.m., Eastern/Sfc3H830*& time, Monday, May 2U, 19R8
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

|f|I m B B B

than three decimals, e. g., 99.925*.

- iI

Fractions may not be used.

mB

pM

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•
Tenders vri.ll 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

TREASURY DEPARTMENT
Information Service

WASHINGTON, D .C.

F OR REXBASE, M O R N I N G . N E W S P A P E R S
Friday, M a y 21, ,1948, ~

No.

S-739

The S e c r e t a r y of the Treasury, b y this p u b l i c notice,
invites tenders for $1,100,000,000, or thereabouts, of 9 1 ~ & a y
T r e a s u r y bills, for cash and in exchange for T r e a s u r y bills
m a t u r i n g M a y 27, 1948, to be issued on a di s c o u n t basis' u n d e r
c o m p e t i t i v e and n o n - c o m p e t i t i v e b i d d i n g as h e r e i n a f t e r p r o v i d e d
The bills of this series wil l be d a t e d M a y 27, 1948, and w i l l
n a t u r e A u g u s t 2.6,, 1948, w h e n the face amount w i l l be p a y a b l e
w i t h o u t interest.
T h e y wil l be issued in b e a r e r f o r m only,
and i n denom i n a t i o n s of $1,000, $5,000, ¿10,000, $100,000,
$ 5 0 0 ,0 0 0 ,, and $ 1 , 0 0 0 , 0 0 0 (maturity v a l u e ; .
Te n d e r s w i l l be re c e i v e d at F e d e r a l Re s e r v e B a nks and
B r a n c h e s up to the closing hour, two o ' c l o c k p.rn., E a s t e r n
da y l i g h t s a v i n g time, Monday, M a y 24, 1943«
T e n ders w i l l not
be r e c e i v e d at the Tr e a s u r y Department, W a s h i n g t o n .
Eachbend e r m u s t be for an e ven m u l t i p l e of $1,000, and in the case
of c o m p e titive tenders the price offered m u s t be- e x p r e s s e d on
the basis of 100,. w i t h not mor e t han three decimals, e.,g.,
99.925*
Fra c t i o n s m a y not be used.
It is urged- that tenders
be m a d e on the p r i n t e d forms and f o r w a r d e d in the s p e cial
envelopes w h i c h . w i l l be supplied by F e d e r a l R e s e r v e B a n k s or
B r a n c h e s on a p p l i c a t i o n therefor.
T e n ders w i l l be recei v e d w i t h o u t deposit^ f r o m i n c o r p o r a t e d
banks and trust companies and from r e s p o n s i b l e and r e c o g n i z e d
de a l e r s in I n v e stment securities.
Tenders f r o m others m u s t
be a c c o m p a n i e d by p a yment of 2 p e r cent of the face a m o u n t of
T r e a s u r y bills applied, for, unless the tenders are a c c o m p a n i e d
by a n express guaranty- of pa y m e n t by an i n c o r p o r a t e d b a n k or
trust comp a n y .
I m m e d i a t e l y a f ter the c l o sing hour, tenders w i l l be o p e n e d
at the F e d e r a l Re s e r v e B a n k s and Branches, f o l l o w i n g w h i c h
p u b l i c a n n o u n c e m e n t wil l be m a d e by the S e c r e t a r y of the
T r e a s u r y of the amount and price range of a c c e p t e d bids.
Those
s u b m i t t i n g tenders w i l l bo a d v ised of the a c c e p t a n c e or r e j e c ­
tion thereof.
The S e c r e t a r y of the T r e a s u r y . e x p ressly reser v e s
h e r i ght to accept or reject any or all tenders, in w h o l e or
in part, and his a c t i o n in any such r e s p e c t - s h a l l be final.
Subject to these reservations, n o n - c o m p e t i t i v e tenders for
$ 2 0 0 , 0 0 0 or less w i t h o u t stated price f r o m a ny one b i d d e r w ill

2
be a c c e p t e d in full at the a v e rage price ( in three decimals)
of a c c e p t e d c o m p e t i t i v e :b i d s . S e t t l e m e n t for a c c e p t e d tenders
in a c c o r d a n c e
w i t h the,bids m u s t be m a d e or C o m p l e t e d at the
F e d e r a l R e s e r v e B a n k o n l M a y 27, 1948, in cash or o t h e r i m ­
m e d i a t e l y ava i l a b l e funds or in a like face amount of Treasury
b i l l s m a t u r i n g M a y 27, 1948,
Cash and exc h a n g e tenders will
r e c e i v e equal treatmentj
Cash a d j u s t m e n t s w i l l be m a d e for
d i f f e r e n c e s b e t w e e n the fpar value of m a t u r i n g bills accepted
in ex c h a n g e and the issue p r i c e -•of 'the' ncW" b i lls ,
The income d e r i v e d ¡.from T r e a s u r y b i l l s , w h e t h e r interest
or g a i n fro m the sale or' other disposition of the bills, shall
‘r o t h a v e any' exemption,, as such, and. loss f r o m the sale or
o t h e r d i s p o s i t i o n of. T r e a s u r y b i lls shall n o t ' h a v e any special
treatment, as such, u n d e r t h e Internal. R e v e n u e Code, or Laws
a m e n d a t o r y or s u p p l e m e n t a r y thereto . The.-bills shall be-subject
to estate, .inheritance, .gift or o t her excise taxes, w h e t h e r
F e d e r a l or State, b ut shall be e x e m p t - f r o m all -taxation n o w or
h e r e a f t e r i m p osed on the -principal- or interest t h e reof by any
•State, or any of the p o s s e s s i o n s of the U n i t e d States, or by
a n y local t a x i n g a uthority.
F o r pu r p o s e s of t a x a t i o n the
a m ount of dis c o u n t cat w h i c h T r e a s u r y bills are o r i g i n a l l y sold
by the U n i t e d States shall be c o n s i d e r e d .to be interest.
Under
Sections- 42 and 117 (a) (l) of the I n t ernal R e v e n u e Code, as
amended' b y S e c t i o n 115 of t h e - R e v e n u e .Act of 1941, the amount
of d i s c o u n t !a t .w h i c h bills •issued h e r e u n d e r are sold shall
n ot be c o n s idered to accrue, u n til such bills shall be sold,
r e d e e m e d or oth e r w i s e d i s p o s e d of, and; such bills cire‘excluded
■f r o h c o n s i d e r a t i o n as capital a s s e t s f A c c o r d i n g l y , the.owner
cf 'Treasury bills (other than life i n s u rance companies )• issued
h e r e u n d e r n é e d include in his income teax •r e t u r n only the d i f ­
fe r e n c e b e t w e e n the price p a i d for such'bills, w h e t h e r u n ­
o r i g i n a l issue or on subs e q u e n t purchase, and the amount actually
r e c e i v e d e i t h e r u p o n sale or redemption-.at:m a t u r i t y d u r i n g the
•taxable y e a r for w h i c h .the r e t u r n is m a d e > as or d i n a r y gain
or loss.
'
'.-.'.1. . .
••
T r e a s u r y D e p a r t m e n t C i r c u l a r No. 418, as amended, and this
notice,' p r e s c r i b e ' t h e terms, of the T r e a s u r y hills and govern
the conditions of t h eir issue.
Copies of the c i r c u l a r m ay
h e o b t a i n e d f r o m any F e d e r a l R e s e r v e B a n k or Branch.

oOo

splendid past achievements is
indisputable proof that you will
equal and excel your previous
efforts toward the progress and
development of this Nation.

since the first
tn

this

institutions have

played a constructive
securing to the American citizen his

in size and in importance, until today

of our national debt and insure a
strong fiscal position.
— - i therefore have no hesitancy
in asking that you bankers continue
the fine support which you have
rendered the savings bond program in
the past - support which i we 11
realize has been many tines freely
given at considerable Inconvenience.
—*The present campaign will
undoubtedly prove harder to carry
on than those of the war years, and
definitely will require greater

institutions.

The Government's

primary purpose in promoting such
savings is two-fold.

First, we are

endeavoring to cut down consumer dema
for goods in short supply, and to
adsorb generally those inflationary
dollars which are a potent danger in
our economy.

Second, we must secure

as widespread an ownership in
Government securities as is possible,
in order to faciIitate the management

which taxpayers are receiving fro* v
tax reduction invested in
increased personal savings, rather
than being spent to add fuel to the
inflationary fires.

We are all

keenly aware of our united
responsibiIIty of Impressing upon
the public the need for saving a
larger share of current Income*
The whole tenor of the United
States Security Loan drive is
directed towards the encouragement of
personal savings in any practical

40

•7 4 &

MWRtfil

during I$46 and 1947, particu(arty in
comparison with the prewar years.
But, a s ! o n g as the danger of
inflation is with us, we hope that
totals for 1948 and 1949 will prove
even larger.

1

Our job of selling

savings bonds, your job in expanding
mutual savings bank deposits and the
jobs of our associates in life
insurance and other savings fields are
really one and the same.

Nothing woulc

please us more, for example, than to
see the major part of the benefits

r‘

39 oniy a little »ore than that for the
entire period 1935 through 1940.
Sone of you »ay feel that the
Treasury Is competing, through the
sate of United States savings bonds,
I

for the very same dollars that you
are endeavoring to obtain as savings
deposits for your banks.
—

When you come right down to it,

however, total savings do not have a
ceiling figure, with each of us trying
ag|j

to get as much of the total as possibh
Savings have been at a high level

~

0 0

**

.N
7<P

f"

of p u b Iic confidence in the services
of your institutions.

The 1947

increase in mutual savings deposits
may seem low as compared with the
wartime increases, but it comprises
a larger proportion of the total new
savings of individuals than was the
case during the war.

As a matter

of record, nearly 10 per cent of new
individual savings during 1946 and
1947 flowed into mutual savings
banks, as against an average of 4
per cent for the war years, and

37

¡ag

portfolios ouring the last two
years -- mostly in long-term
securities.

And, a most interesting

fact is that this billion dollar
increase in Governments has been
matched by a billion dollar increase
in mortgage loans and other
investments.
— The fact that mutual savings bank
assets, as a reflection of deposits,
have continued to increase in such
volume since the end of the war
represents an exceptional expression

*j4û
HaM ^N**^**- ********

f r o m rising too rapidly.

We

a considerable number of long-term
bonds to the various investor classes.
savings banks, as a group,
were among the larger purchasers.
Since then, mutual savings banks
have sold some long-term bonds, on
balance;

but their total holdings of

Federal securities are now only about
100 million dollars less than they
were at their all-time
summer.

All in all, you have added

$1 biiIion to your Government security

campaign.

It is also because of the

further accumulation of social
security money and other Government
trust fund receipts, jr
I should like no* to touch
briefly on your own position with
respect to Government securities.
— - During most of 1947,

it was the

policy of the Treasury to liquidate
some Government trust fund holdings
■ .yj: , ';£;v ;

of long-term securities in its
program of monetary controls designed
to prevent Government bond prices

ffi

SJ*

34
marketable obligations.

The

remainder is in the form of savings
bonds, savings notes, special

issues

to Government trust funas, and other
nonmarketable obligations.

[This
If ; .'

non-marketable part of the debt may
go up by something like $3 i5i Ilion
during the year ahead, thus perm itting
a reduction in the total of the
marketable debt.

This is due

primarily to the intensity with
which we are pressing - and will
continue to press - our savings bond

33 -

7<P

But unfortunateI y , the combination
of tax reduction and increased
expenditure probably spells the end
of debt reduction from budget surplus
during the next year.
— However, even if overall debt
reduction comes to a halt during the
months ahead,

it may stiI I be

possible for us to shave somewhat
further the volume of the marketable
debt.

As you know, only a portion

of the $252 billion of Government
indebtedness is in the form of

32 expenditures will have to be
undertaken.

The success of these

programs is of paramount importance
to all of us.
Undoubtedly, with a view to
sound fiscal management, these
expenses should have been financed
within a balanced budget.
certainly,

And

if we are to continue to

pay off portions of the public debt
accumulated during the war, we must
do it during a prosperous period
such as prevails at the present time.

- 31 -

1 ér0

certainly would not have dared
forecast, a program as successful as
this when we stood at the threshold
of debt pay-offs back in 1346,
Now,

in May,

l948, our debt has

been reduced by nearly $28 billion
However, due to certain United States
commitments and possible requirements
of the near future, the outlook for
debt reduction can not now be
accurately estimated*

The European

Recovery Program is just getting under
way.

Large national defense

if

30

?

reduction in total public debt.
On February 28,

1946, commercial and

Federal Reserve Banks held $117
billion of Federal securities.

At

the present time, they hold $86
billion.

This decline of $31 billion

represents a reduction of more than
25 per cent in commercial and Federal
Reserve Bank portfolios of Government
securi ties in just a little over two
years.
is a substantial achievement
We could hardly have laid out, and we

will remember that during the war we
issued a large volume of short-term
bills and certificates to the banking
system.

As a result, our job of pay in

off the debt held by banks has been
considerably simplified,

it is

gratifying to us that, since the
peak of the debt, nonbank holdings of
Federal securities have gone up by
about $3 billion, so that the
reduction in holdings by commercial
and Federal Reserve Banks has
actually been greater than the

28

-

7 Cfô

Its expenditures was of major
anti- inf Iat ionary importance
^ — • Hand in hand with this
development has been our Treasury
policy, during the period, of aiming
at a reduction in the Federal securit
holdings of the c ommercia I banking
system.
in seeking to achieve this
objective, we have found that our
wartime program of fitting
securities to the needs of the variou
investors has paid dividends.

You

27

'1^-0

to come.
As bankers,

I am sure that all

of you are familiar with the policy
behind the debt pay-off program as
it has been conducted.
Increasing inflationary pressures
in the economy during the past two
years have made it imperative that
fiscal and monetary policy be

pressures.

The very fact that the

Treasury was receiving more money in
taxes than it was paying out through

if

tnose

months, we reduced the

t

.

P'

debt by $4,» billion -- a Imost/ twi ce
the reduction for the entire calendar
year 1947.

The money for this

program came from our budget surplus
of $6 billion
rest of the surplus has been added
temporarily to the cash balance.
Part of this remainder may eventually
be used for debt reduction - although
.

■

some of it will be needed to meet
new requirements for national defense
*
and internati ona I aid during the montt

received from the Victory Loan.
j||—

During the calendar year 1947,

the next phase of the pay-off program,
we were able to cut the debt by $2.5
billion.

The cash left over from the

Victory Loan had been expended by this
time, so that debt reduction during
1947 had to come from the budget
surplus - and was, in fact, just about
equal to that surplus,
^ ---The third phase of the debt
pay-off program occurred during the
first four months of this year.

In

needed a Treasury cash balance of
the proportions for which the
emergencies of the preceding years
had cal led.

A debt pay-off program

was therefore inaugurated.

It has

brought the debt down to the current
total of $252 billion.

This pay-off

program which we have carried out
fell
—

into three periods.
From the end of February, 1946,

to the close of the year, the debt
was reduced by $20 billion through
the application of cash funds

And it places upoh the Federal
4
■ ;
:■/ ' .
”
v\
Government a grave responsibiitty
for proper debt management and for
the sound conduct of all of its
financial affairs.
I should like to review the
history of the management of the debt
since the debt reached a peak of
$280 billion in February,

1946.

^ — "The Victory Loan of two months
earlier had been our last great
drive for funds.

StJr costs had begun

to taper off, and we no longer

of their savings and deposits in
mutual savings banks, commercial
■t

banks,

insurance companies, and other *

financial

institutions which own

Federal securities.
><f---This widespread distribution of
the public debt gives every person
in the United States a vital

interest

in the debt and in its proper
management.

It gives every individual

an immediate and persona I incentive
for seeing that the financial affairs
of the Government are handled wisely*

-

21

-

and public debt management will
sharply affect the situation of the
banking institutions represented here.
This is, of course, likewise true of
other financial

institutions.

in a much broader sense,

And,

it is also

true of individuals*
^ — .individual citizens direct Iy
own more than$66 billion *^Saaes of
Federal securities.

In addition,

they have an indirect stake in a
much larger portion of the public
debt securities outstanding because

k 11»

for similarly large proportions of the
total amount of

11
.
l
|
l
,
.
M
Federal obligations. *

Today, many of your banks have
as much as three-fourths of their
assets invested in Federal securities,
while your combined ownership of
'12 billion

is four times as

great as it was before the war.
Mutual savings banks now hold about
5 per cent of the total public debt,
which stands at $252 billion.
Consequently, factors which affect
the field of Government securities

- I9 -

q ii $

i>mm.

Federal securities
near Iy
half of its total deposits at that
t ime.
By 1890, a quarter of a century
later, all savings banks,

including

stock savings banks, held
approx imate Iy/l 40 million Jailutts or
20 percent of the total
interest-bearing debt of the
United States in their portfolios.
And,

in a number of other years for

which data are available, they accounted

id

ft iwf.

years that officials of the New York
savings banks met in 1861 to determine
the amounts in new Federal issues for
which they would subscribe.

in the

words of their historian, the
trustees of one large bank observed
with cogent logic that "the public
was looking to conservative savings
banks for an expression of confidence
in these Government securities."
This same bank,

it might be noted,

subsequent Iy followed up its own
hint and increased its holdings of

an earnest, conscientious lot of
pioneers who grappled with the», and
who laid the foundations of a
mutual savings bank system which
has become one of the important
factors behind our successful modern
economy.
—

By the time of the Civil War,

the mutual savings banks felt strong
enough to offer substantial support
to the Federal Government» as they
have in all critical periods since.
$e Iearn from the records of those

your trustees would emulate the
\
savings bank of long years ago that
decided to attract customers by paying
N
a ^ per cent higher rate to
CflUL

depositors who were about to be

.

married.

j J

And it has been a good

many years since a savings bank has
offered to present new accounts with
a one'dollar free start.
Although the early problems of
savings institutions were different
from today’s problems, they were
nonetheless very real, and it was

-

15

-

7 ^

other securities.
---Âs legendary as covered wagons
and coonskin caps are some of the
early techniques of savings banking techniques that appear engagingly
simple compared with those of the
present,

it is improbable today that

any of you would deem it advisable to
restrict depositors to "widows,
orphans, single women, and minors'*,
as one of the oldest institutions
felt obliged to do at one time.
Likewise,

it is doubtful that any of

When mutual savings banks were
first organized in the years following
1816, many of their charters provided
that their investments could be only
in United States Government
securities and in the securities of
the State in which they were organized
But then, as now, the problem of
securing an adequate return was
paramount in portfolio management, and
the banks soon found it necessary to
ask that their charters be broadened
to permit investment in mortgages and

13 -

<1 tfrà

savings by the American public.

."Jit!!.;

You,

the custodians, are assembled here
132 years after the founding of the
first mutual savings institution ever
to open its doors in this country.
This occasion, then, is another
milestone in your history - a history
of long and successfuI guardianship
over the financial affairs of the
average citizen.

I am happy indeed

to have the privilege of addressing
a company with so distinguished a
record of public service.

j

This disclosure led to evidence that
resulted in the collection of 3

Xtf «0# *

million in taxes, as well as prison
sentences for several persons.

So

in asking that you continue
essential participation in
enforcement division, we are only.
|

//protecting your own millions of
depositors and assisting you to
discharge your obligation to them
r

The National Association of
Savings Banks represents
custodians of

billion do U ,a pc

Treasury In tracking down tax evaders.
In one instance, a Midwestern business
%
man Had converted his profit into
large currency holdings which were
detected through one of your reports,
i

thus resulting in accumulates*
evidence that led to a quarter of a
a ill ion dollars in tax assessments
plus recommendation for criminal
prosecution.

■ ■
Another^ooerator of a

large chain of restaurants in aio
c*cr^alrT cityifwas reported to have
been making large currency deposits

to
collection of extensive amounts of
revenue which tax evaders sought to
withhold.
t— — It is very important that you
bankers fully realize the significance
of these TCR reports to the Treasury,
for our tax collection work in this
division would be far more comp Iicated
if this special

information were not

made available to us.
instances alone
will give you the measure of the
importance of these reports to the

$

7 *ii- ^

- 3 accept j the ir
responsibiIity in

enf orcement
A i

"F

specific request
Treasury Currency Reports -be supplied, through the Federal
Reserve System,

in the case of

unusual currency transactions.
On the whole, the plan has accomp I is he<
worthwhile results.

whi l e

it

not disturbed healthy and legitimate
banker-customer relationships,

it has

resulted in the disclosure of a large
number of tax

'; 'v''-ir

a«-.»«--

-

mention here.

I refer to your

cooperation in certain
of our efforts
I
to protect the integrity of the

x

Federal revenues.
y

0---You of course know that the

solvency of this Government depends
upon the fair and proper collection of
the internal revenue.

Evasion of the

taxation laws, if permitted to
go unchecked, could easily become
disastrous.

For this realistic

reason, the banks and other financial
institutions were called upon

SJ

c f ~ù

7
the extent of the assi

h has

been rendered by your
And we are assured, because of your
longgVhistor;

owners of

Federal Securities as well as your
interest in the financial welfare of
your depositors, that we may count
upon your continued active help.
There is one particular form of
assistance offeree the Treasury by
banks in general which, because of its
wide importance,

1 should like to

- 1 -

/f\ ^ Ù •«

government security dealers, and
bankers in the investment, commercial
and savings fields.

And I want

to sly here, that I, personally, have
had no more valuable counsel than
that given me by members of consulting!
committees on Government borrowing,
in the course of their periodic visits
to the Treasury.

My several meetings

with your own committee, functioning
under the chairmanship of Mr. Bruere,
have been most beneficial.

If—flThe

Treasury is fully aware of

government, and the methods by which
our inter-dependent operations may
achieve the most beneficial results.
^— ~ As in the case of other
governmental departments, the
Treasury is constantly seeking the
counsel and active assistance of
f

various business organizations
throughout the nation.

A financial

cross-section ofthe country is
represented in our advisory
committees, which include
indus tr ia Ii sts, life insurance groups

government can and should provide
what we can call "rules of the game
and enforce such rules;

it can

encourage economic development;

it

assist in recovery should depression
nevertheless develop;

and it can

take the lead in mitigating the
dread of personal insecurity in an
industrial society.
As a public official,

l regard

as especially important the close
re Iat ionsn ip of business to

a keenly interested and alert
citizenry, deeply conscious of the
Nation’s need for economic solidarity.
Some people insist that the
government should keep completely
aloof f r o m the economic system of
the Nation -- that it should confine
its role virtually to one of keeping
the peace ana carrying the mails.
^—

This is not my idea of the role

of government, nor of the relationship
that ought to exist between
government and bus inessi

Good

■»«lei--

-

2

7

-

f^

For this reason, we must not
—

allow domestic partisanship and
di sagreements, norma I to an
American election period, to endanger
our greater aims.

For,

if the

American economy is to gain the
necessary growth and advancement, we
must have genuine cooperation between
management,

labor, farming, and

government - and have it under the
normal processes of our free
enterprise system.

And the first

requirement to such cooperation is

.

Our common obligation today
is to encourage production and general
business health.

I Ii ons of peop Ie

everywhere are looking to the
United States to safeguard the
tangibles of decent, human living,
We are making every effort to reduce
the extent of economic disorder i
ts/t

political disturbance
\

we can.

M

W,

The next few months

. / They should determine the
success of these efforts.

-MUTUAL SAVINGS BANKS
AND THE PUBLIC DEBT.M

*v

If”,if

ATLANTIC CITY, NEW JERSEY
MAY 24, 1948

D

WÊÊÊÊÊ

ADDRESS BY SECRETARY SNYDER
BEFORE THE ANNUAL CONFERENCE
OF THE NATIONAL ASSOCIATION
OF MUTUAL SAVINGS BANKS.

Statement by Secretary Snyder for press
Conference at Hotel Traymore,
Atlantic City, N. J., May 24, 1948

/

The Security Loan Drive is doing well, and New Jersey

is an excellent example to cite*
Volunteer salesmen have canvassed more than 300,000
industrial workers of this State since the drive started,
encouraging them to buy bonds through the Payroll Savings
Plan*

I am told 200,000 more workers will receive personal

visits before the drive ends*
Payroll Savings Plan participation has jumped to
62 percent at the RCA Victor plant in Camden, 50 percent
at the Prudential Insurance Company in Newark, and 50
percent at the Botany Mills in Passaic.
Some 40 New Jersey concerns which dropped the Payroll
Savings Plan after the war have reinstated it*

Management

and labor share the credit for this fine showing•
Every county in New Jersey has a complete volunteer
bond selling organization.

This State is putting real

punch into its Security Loan campaign*

We hope to see

the State sales goal of $£6,400,000 surpassed.

TREASURY DEPARTMENT
Washington

The f o l l o w i n g address b y S e c r e t a r y S n yder b e fore
the A n n u a l C o n f erence of the N a t i o n a l A s s o c i a t i o n
of M u t u a l Savings Banks, at the T r a y m c r e Hotel,
A t l a n t i c City, N . J ,,,is sch e d u l e d for d e l i v e r y
at 1:30 P .M. j E tD ,S , T t, M a y 24, I 9A 8 , and is for
release' at that time".
■

"MUTUAL SAVINGS B A N K S A N D T HE P U B L I C D E B T "

Our c o m m o n o b l i g a t i o n ' t o d a y is to e n c o u r a g e p r o d u c t i o n
and g e n eral business heal th.
M i l l i o n s of p e o p l e e v e r y w h e r e
are l o o k i n g to the U n i t e d States to s a f e g u a r d ’ the t a n g ibles
of decent, h u m a n living.
W e are m a k i n g e v e r y e f fort to reduce the e x tent of e c o nomic d i s o r d e r and p o l i t i c a l d i s ­
tu r b a n c e w h e r e v e r we can.
The n e x t few m o n t h s w i l l be
e x t r e m e l y s i g n i ficant ones.
They should d e t e r m i n e the s u c ­
cess of these efforts.
F o r this reason, we m u s t not a l l o w
d o m e s t i c p a r t i s a n s h i p and d i s a g r eements, n o r m a l to an
A m e r i c a n e l e c t i o n period, to e n d a n g e r our g r e a t e r aims.
For,
if the A m e r i c a n ec o n o m y is to g a i n the n e c e s s a r y g r o w t h and advancement, we m ust h a v e genuine c o o p e r a t i o n b e t w e e n m a n a g e ­
ment, labor, farming, and g o v e r n m e n t - and h a v e it u n d e r the
n o r m a l p r o c e s s e s o f .our free e n t e r p r i s e system.
A n d the first
r e q u i r e m e n t to such c o o p e r a t i o n is a k e e n l y I n t e r e s t e d and
alert citizenry, d e e p l y conscious of the N a t i o n ’s n e e d for
e c o n o m i c solidarity.
Some p e o p l e I n s i s t that the g o v e r n m e n t shou l d keepc o m p l e t e l y a l oof f r o m the e c o nomic s y s t e m of the N a t i o n -that it should confine its role v i r t u a l l y to one of k e e p i n g
the p e a c e and c a r r y i n g the m a l l s . This is n ot m y i dea of the
role of government, n o r of the r e l a t i o n s h i p that ought to
exist b e t w e e n gove r n m e n t and b u s i n e s s in our e v e r e x p a n d i n g
e c o nomic d e v e l o p m e n t .
Good g o v e r n m e n t c'an and s h o u l d p r o v i d e
w h a t we can call "rules of the game", and en f o r c e such rules;
it can enc o u r a g e ec o n o m i c d evelopment; It can p r o v i d e s a f e ­
guards ag a i n s t d e p r e s s i o n and a s s i s t in r e c o v e r y shou l d
d e p r e s s i o n n e v e r t h e l e s s develop; and it can take the lead in
m i t i g a t i n g the d r e a d of p e r s o n a l i n s e c u r i t y in a n i n d u s t r i a l
society.
As a p u b l i c 'official, I r e g a r d as e s p e c i a l l y i m p o rtant
the close r e l a t i o n s h i p of bus i n e s s to government, and the
m e t h o d s by w h i c h our i n t e r - d e p e n d e n t o p e r a t i o n s m a y a c h ieve
the. m o s t b e n e f i c i a l results.
As in the case of other g o v e r n ­
m e n t a l d epartments, the T r e a s u r y Is c o n s t a n t l y s e e k i n g the
c o u nsel and a c tive a s s i s t a n c e of v a r ious b u s i n e s s o r g a n i z a t i o n s

3 -74 0

t h r o u g h o u t the n a tion.
A f i n a n c i a l c r o s s - s e c t i o n of the
co u n t r y is r e p r e s e n t e d in our a d v i s o r y committees, w h i c h i n ­
clude i n dustrialists, life i n s u r a n c e groups, g o v e r n m e n t
s e c u r i t y dealers, and h a n k e r s in the investment, c o m m e r c i a l
and savings fields.
A n d I w a n t to say here, that I, personally,
h a v e h a d no m o r e v a l u a b l e c o u nsel than that g i v e n me b y members
of c o n s u l t i n g committees o n G o v e r n m e n t b o r r owing, in the
course .of t h e i r . p e r i o d i c visi t s to the T r e asury.
M y several
m e e t i n g s w i t h y o u r o wn committee', f u n c t i o n i n g u n d e r the c h a i r ­
m a n s h i p of Mr. Bruere, h a v e b e e n mos t bene f i c i a l .
The Tr e a s u r y
is f u l l y aware of the extent of the a s s i s t a n c e :w h i c h has b e e n
r e n d e r e d b y y o u r b a n k s . A n d we are assured, b e c a u s e of y o u r
lon g i m p r e s s i v e h i s t o r y as owners of F e d e r a l Secu r i t i e s as
well as y o u r inter e s t in the f i n a n c i a l w e l f a r e of y o u r d e p o s i ­
tors, that' we m a y count u p o n y o u r con t i n u e d active help.
There is one p a r t i c u l a r f o r m of a s s i s t a n c e of f e r e d the
T r e a s u r y b y banks in g e n eral which, b e c a u s e of its w i d e
i m p o r t a n c e , “ X should like to m e n t i o n h e r e .
I r e f e r to y o u r
c o o p e r a t i o n in ce r t a i n of our e f f o r t s to p r o t e c t the i n t e g r i t y
of the F e d e r a l revenues.
Y o u of course k n o w that, the solvency
of this G o v e r n m e n t depends u p o n the f air and. p r o p e r c o l l e c ­
t i o n of the in t e r n a l r e v e n u e . E v a s i o n of the t a x a t i o n laws,
if permitted, to go unchecked, could e a s i l y b e come d i s a s t r o u s .
F o r this r e a l i s t i c reason, the banks and other f i n a n c i a l
i n s t i t u t i o n s wer e called u p o n -to a c cept w i t h . t h e T r e a s u r y
t h e i r e q ual r e s p o n s i b i l i t y in tax e nforcement.
One speci f i c r e q uest was for T r e a s u r y Cur r e n c y R e p o r t s -to be supplied, th r o u g h the F e d e r a l R e s e r v e System, in the
case of u n u s u a l c u r rency transa c t i o n s .
On the whole, the p lan
has a c c o m p l i s h e d w o r t h w h i l e results. .For w h i l e it has not
d i s t u r b e d h e a l t h y and l e g i t i m a t e b a n k e r - c u s t o m e r relationships,
it h a s r e s u l t e d in the d i s c l o s u r e of a large n u m b e r of tax
f r aud cases and the c o l l e c t i o n of e x t e n s i v e amounts of revenue
w h i c h tax 'evaders sought to wit h h o l d .
It is v e r y important
that y o u ba n k e r s f u lly r e a l i z e the s i g n i f i c a n c e of these T CR
r e p orts to the Treasury, for our tax c o l l e c t i o n w o r k in this
d i v i s i o n w o u l d be f ar m o r e c o m p l i c a t e d if this special i n f o r ­
m a t i o n w e r e not m a d e a v a i l a b l e to us.
T wo i n s t ances alone
w i l l give, y o u the m e a s u r e of the i m p o r t a n c e of these reports
to the T r e a s u r y in t r a c k i n g d o w n tax evaders.
In one instance,
a m i d w e s t e r n b u s i n e s s m a n h a d c o n v e r t e d h iS p r o f i t into large
c u r r e n c y h o l d i n g s w h i c h w e r e d e t e c t e d t h r o u g h one of y o u r
reports, thus r e s u l t i n g in a c c u m u l a t i n g evide n c e that led to ~
a q u a r t e r of a m i l l i o n d o l lars i n tax a ssessments, plus r e c o m ­
m e n d a t i o n f o r c r i minal p r o s e c u t i o n .
A n o t h e r case was that of
an o p e r a t o r of a large c h ain of r e s t a u r a n t s in.an. e a s t e r n city
who was r e p o r t e d to h a v e b e e n m a k i n g large, c u r r e n c y deposits.
This d i s c l o s u r e led to e v i d e n c e that r e s u l t e d in. the c o l l e c t i o n
of $7 m i l l i o n In taxes, as w e l l as p r i s o n s e n t ences for several
p e r sons.
So in a s k i n g that y o u continue y o u r e s s e n t i a l
p a r t i c i p a t i o n in this t ax e n f o r c e m e n t division, we are only

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protecting your,, own millions of depositors and assisting
you to discharge;your obligation to them.
The National Association of Mutual.Savings Banks repre­
sents, -the. custodians of $18 billion of savings by the American
public. You, the' custodians,' are assembled here 132• years
after the founding of the first mutual savings institution
‘ever to open its doors in this country. This occasion, then,
is another milestone in your history ~ a history of long and
successful; guardianship over the: financial affairs .of the
average citizeh'. .; I am-happy;-Indeed .tn have the privilege of
addres sing, a company with ha distinguished a record of public
service . ''
/
*• •
When mutual savings- banks were first organized in. the
/years following l8l6, many of their charters provided that
their investments could be only in United States Government
•securities and in the; securities of the State in which they
vere organized. But then, as now, the problem of securing
an. adequate return vas paramount in portfolio management', and
the banks soon foUhd.lt necessary to ask that their charters
be broadened to permit investment -in mortgages and other.
securities. As"legendary as covered wagons and coonskin caps
..are some of the early techniques' of'savings banking - techniques
' that appear engagingly simple compared with those of the.
present... It is improbable today that any of; you would deem it
•'advisable to restrict depositors to "widows, V.orphans / 'single
women, and' minors", as.one' of the oldest institutions felt
obliged'to &c at one- time . Likewise,* it is doubtful that any
of your trustees would emulate the-sayings bank of long years
ago that decided to attract customers by paying a one per
cent higher,rate to depositors who were about to be mapried.
And it has'been a good many years since a savings bank has
offered to present new accounts with a one dollar free start,
Although the early problems of savings institutions"were .
different from.today's problems, they were nonetheless very
real, -and it was an earnest, conscientious- let of pioneers who
grappled/with them, and who, laid the foundations of a mutual
savings ‘bank system which has become, one of the important
factors, behind our successful modern economy. By the time of
the C i v i l bar. the mutual savings''banks felt strong .enough"
to offer substantial;-support .to the Federal Government, as they
have, in all critical'periods 'since. We learn from" the records
of those:'years'that officials of the. New York savings’ hanks
met in l86l to determine the amounts in new Federal issues for
which they Would, subscribe . ■ In'‘ the words of their historian,
the trustees of one -large bank observed with cogent,logic that
"the public' was- looking to conservative; savings banks for an
expression of- confidence; in these Government; securities."
This same bank,, it might be -noted, subsequently followed up its
own hint,, and -increased its holdings of Federal securities to
nearly half of its total deposits at that time. By l8-901 a

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q u a r t e r of a c e n tury later, all savings banks, i n c l u d i n g
s t o c k savings banks, h e l d a p p r o x i m a t e l y $ l 4 o m i l l i o n or 20
p e r c e n t of t h e 'total i n t e r e s t - b e a r i n g .debt of the U n i t e d
S t a t e s .in t h e i r p o r t f o l i o s . \ A n d , in a n u m b e r of o t h e r years
f or w h i c h d a t a are available, they a c c o u n t e d for s i m i l a r l y '
large p r o p o r t i o n s of the total a m o u n t of -Federal o b l i g a t i o n s .
Today,, m a n y of y o u r banks h a v e .as m u c h as t h r e e - f o u r t h s
of their assets Invested, in F e d e r a l securities, w h i l e y o u r
c o m bined o w n e r s h i p of $12 b i l l i o n ' i s four times as great as
it was b e f o r e the;war.
M u t u a l savings banks n o w h o l d about
5 p e r cent of the t o tal p u b l i c d e b t / w h i c h stands at $ 2 5 2
billion.
Consequently, factors w h i c h affe c t the f i eld of
G o v e r n m e n t securities and p u b l i c debt m a n a g e m e n t w i l l sharply
a f fect the s i t u a t i o n of the b a n k i n g i n s t i t u t i o n s r e p r e s e n t e d
here.
This is, of course, l i k ewise true of o t her f i n a n c i a l
institutions.
And,, in a m u c h b r o a d e r sense, it is also true
of i n d i v i d u a l s , I n d i v i d u a l citizens d i r e c t l y own m o r e tha n
$66 b i l l i o n of F e d e r a l s ecurities . ' In addition,, t h e y h ave an
indirect stake in a m u c h l a rger p o r t i o n of the p u b l i c debt
securities, outstanding, b e c a u s e of t h eir savings and deposits
in m u t u a l savings banks, c o m m e r c i a l banks, i n s u rance companies,
and other f i n a n c i a l institutions, w h i c h own F e d e r a l securities.
This w i d e s p r e a d d i s t r i b u t i o n of the p u b l i c debt gives e v ery
p e r s o n in the U n i t e d States a vital interest In the debt and
in its p r o p e r m a n a g e m e n t . It gives e v e r y i n d i v i d u a l an i m ­
m e d i a t e and p e r s o n a l i n c e n t i v e for s e eing that the fi n a n c i a l
affairs of the G o v e r n m e n t are h a n d l e d w i sely.
A n d it places
u p o n the F e d e r a l G o v e r n m e n t a grave responsIbillty'’f or p r o p e r
d e b t - m a n a g e m e n t and for the sound conduct of all of Its
financial.affairs.
•
I should like'to r e v i e w the h i s t o r y of the m a n a g e m e n t of
the debt since the debt r e a c h e d a p e a k of $28 0 b i l l i o n in
F e b r uary, 1946.
The V i c t o r y L o a n of two m o n t h s e a r l i e r h a d
b e e n our last great drive for funds,
W a r costs h a d b e g u n to
t a p e r off, and wè no l o n g e r n e e d e d a T r e a s u r y cash b a l a n c e of
the proportions; for w h i c h the e m e r g e n c i e s of the p r e c e d i n g
y e ars had. called.
A debt p a y - o f f p r o g r a m was t h e r e f o r e
i n a u g urated.
It has b r o u g h t the d ebt d o w n to the* current total
o f . $ 2 5 2 b i l lion.
This p a y - o f f p r o g r a m w h i c h we hav e carried
out fell into three periods.
F r o m the end of February, 1946,
to the close of the year, the debt was r e d u c e d by $20 b i l l i o n
t h r o u g h the a p p l i c a t i o n of cash funds r e c e i v e d f r o m the Victory
Loan.
D u r i n g the ca l e n d a r y e a r 1947, the n ext p h a s e of the
p a y - o f f program, we w e r e able to cut the debt by $2 ,. 5 billion.
T h e - c a s h left o v e r .from the v i c t o r y L o a n h a d b e e n e x p e n d e d by
this time, so that debt r e d u c t i o n d u r i n g 1947 h a d to come from
the b u d g e t surplus - and was, in fact, just about equal to
that surplus .
The third p h a s e of the debt p a y - o f f programo c c u r r e d d u r i n g the first f our m o n t h s of this y e ar.
In those
f e w months, we r e d u c e d the deb t b y $4. 7 b i l l i o n -- almost

twice the r e d u c t i o n for the entire c a l e n d a r y e a r 1947.
The
m o n e y f or this p r o g r a m came from o u r . b u d g e t surplus of $6
b i l l i o n a c c u m u l a t e d since J a n u a r y 1, 1948.
The rest o f the'
surplus has b e e n added t e m p o r a r i l y to the cash b a l a n c e . Part
of this r e m a i n d e r m a y e v e n t u a l l y be' u sed f or deb t r e d u c t i o n a l t h o u g h some of it w i l l be n e e d e d to m e e t n e w r e q u i r e m e n t s
.for n a t i o n a l d e f e n s e and i n t e r n a t i o n a l aid d u r i n g the m o n t h s
to come.
.
As b a n k e r s , I am sure that all of y o u are f a m i l i a r w i t h
the p o l i c y b e h i n d the debt p a y - o f f p r o g r a m as it h a s b e e n
c onducted.
I n c r e a s i n g inflationary, p r e s s u r e s in the e c o n o m y
d u r i n g the pas t two years h a v e m a d e it i m p e r a t i v e that fisc a l
and m o n e t a r y p o l i c y be d i r e c t e d to c o m b a t i n g f u r t h e r inc r e a s e s
In price..
The v e r y fact that the T r e a s u r y was r e c e i v i n g
m o r e m o n e y i n taxes than it was p a y i n g out t h r o u g h Its e x p e n ­
di t u r e s was of m a j o r a n t i - i n f l a t i o n a r y •i m p o r t a n c e . *H a n d in
h a n d w i t h this d e v e l o p m e n t has b e e n our T r e a s u r y policy,
d u r i n g the period, of a i m i n g at a r e d u c t i o n in the F e d e r a l
■security h o l d i n g s of the comm e r c i a l b a n k i n g system.
In se e k i n g
to ac h i e v e this objective, we h a v e found that our w a r t i m e
p r o g r a m of f i t t i n g •securities to the needs of the va r i o u s
investors has p a i d dividends.
Y o u w i l l r e m e m b e r that d u r i n g
the w a r we issu e d a large volume of short-term, bills a n d
c e r t i f i c a t e s to the b a n k i n g system.
A s a result, our -job of
p a y i n g off the debt h e l d by banks has b e e n c o n s i d e r a b l y
simplified-.. It is g r a t i f y i n g to us that, since- the p e a k of
the debt, n o n b a n k h o l d i n g s of F e d e r a l securities h ave g o n e ' u p
b y . a b o u t $3 billion, so that the. r e d u c t i o n in h o l d i n g s by:
commercial and F e d e r a l Re s e r v e Banks has a c t u a l l y b e e n g r e a t e r
tha n the r e d u c t i o n in total p u b l i c d e b t . , On F e b r u a r y 28, 1946,
c o m m e r c i a l and F e d e r a l Reserve. B a nks h e l d $11 7 b i l l i o n of
F e d e r a l securities.
A t the p r e s e n t time, the y h o l d $86 bi l l i o n .
This decline of $31 b i l l i o n ‘r e p r e s e n t s a r e d u c t i o n of more
t h a n 25 p e r cent in c o m m ercial and F e d e r a l R e s e r v e Bank, p o r t ­
folios of G o v e r n m e n t Securities in just a little over two
years.
This is a subs t a n t i a l a c h i e v e m e n t . We could h a r d l y
h a v e laid out, and we cer t a i n l y w o u l d not h a v e d a r e d forecast,
a p r o g r a m as s u c c e s s f u l as this w h e n we stood at the t h r e s h o l d
of d e b t - p a y - o f f s b a c k In 1946.

t ■ Now, In May, 1948, our debt has b e e n r e d u c e d b y n e a r l y
$28 billion.
However, due to c e r t a i n U n i t e d States c o m m itments
and p o s s i b l e r e q u i r e m e n t s of. the n e a r future, the o u t l o o k for
debt r e d u c t i o n con not n o w be a c c u r a t e l y e stimated.
The
E u r o p e a n R e c o v e r y P r o g r a m is just g e t t i n g u n d e r way.
Large
n a t i o n a l de f e n s e e x p e n d i t u r e s w i l l 'h a v e to -be u n d e r t a k e n . The
success of these p r o g r a m s is of p a r a m o u n t i m p o r t a n c e to all
of us.
U n d o u b t e d l y , w i t h a v i e w to sound f i s c a l m a n a g e m e n t ,
these e x p enses should H a v e b e e n f i n a n c e d w i t h i n a b a l a n c e d
b u dget . A n d certainly, If .we are to continue to p a y off .

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6

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portions of tho public debt accumulated during the war* Ve
must do it during a .prosperous, period such as prevails at .,
the present time. But. unfortunately, the combination- of: tax
reduction and increased expenditure .probably spells the end
of. debt reduction from budget surplus during the next- .year *
Hove ver, even if overall debt reduction comes to a halt- during
the,months, ahead, it may still be possible for us to-shave
somewhat further the volume of the- marketable debt. -As you .
knov, only a portion of the $252 billion of Government .
indebtedness is in the form of marketable obligations!* The
remainder is in the" form of savings, bonds, savings notes,
special issues to Government trust funds, and other nonmarketable obligations. This nonmarketable part of the debt may go
up by something like $3 billion during the year ahead,- thus
permitting .a reduction in the total of the marketable debt »
This is .due p r i m a r i l y to the i n t e n s i t y - v i t h w h i c h ve are,
p r e s s i n g . - an d v i l i continue to p r ess - our savings b o n d c a m ­
paign.It is also b e c a u s e of the f u r t h e r a c c u m u l a t i o n of
social s e c u r i t y m o n e y a nd other G o v e r n m e n t trust f u n d - r e c e i p t s .

I should like hov to touch briefly on your ovn position
vith respect to.Government securities. During most of 19^7,
it v a s .thè policy of the Treasury to liquidate some Government
trust fund .holdings of long-term securities•in its program of
monetary controls designed to prevent Government bond prices
from rising too rapidly. We sold a considerable number *of
long-term bonds to the. various investor classes . ■ Mutual •sav­
ings. banks,; as a .group, vere among the larger purchasers ,
Since then, mutual savings banks have, sold some- long-term bonds,
on balance; but their totals holdings of Federal -securities are
nov only about 100 million dollars less than they vere at
'their all-time peak last summer. All in all, you have- added
$1 billion'to your Government security portfolios during the
last tvo years --mostly in long-term securities . And, a-most
interesting fact is that this, billion dollar increase in
Governments has been matched by a billion dollar increase in
mortgage loans and other, investments*- The fact that, mutual
savings bank assets, as a reflection of deposits, have continued
to increase in such" volume since the end ^of the var represents
an exceptional expression of public confidence in the services
of your institutions. The 1947 increase in miutual savings
deposits may seem lov as compared vith the vartime increases,
but it comprises a larger proportion of the total nev•savings
of individuals- than vas the case during the var. As' a matter
ó f -record, nearly 10 per cent of nev individual savings during
1946 and 1947! f.lbved into mutual, savings banks, as against an
average of 4 per cent for the var years, and only-a little
more than'that for the entire period 1 9 3 5 through 1940.
Some of y o u m a y feel that the T r e a s u r y is competing,
t h r o u g h the sale of U n i t e d States savings bonds, for the very
same dollars that y o u are e n d e a v o r i n g to o b t a i n as savings ;
d e p o s i t s for y o u r banks.
W h e n y o u come right d o v n to it,

- 7 howev e r , total savings do not h a v e a c e i l i n g figure, w i t h eac h
of us t r y i n g to get as m u c h of the total as p o s s i b l e .
Savings
hav e b e e n at a h i g h level d u r i n g 19^6- and 1947, p a r t i c u l a r l y
in c o m p a r i s o n w i t h the p r e w a r years.
But, as lon g as the
d a nger of i n f l a t i o n is w i t h us, we h o p e that totals for 1948
and 1949 w i l l p r ove eve n larger.
Our job of s e l l i n g savings
bonds, y o u r job in e x p a n d i n g m u t u a l savings b a n k d e p o s i t s
and the jobs of our associates in life i n s u r a n c e and other
s a v i n g s fields are r e ally one and the same.
Nothing would
p l e a s e us more, for example, t h a n to see the m a j o r p a r t of the
b e n e f i t s w h i c h taxpayers are r e c e i v i n g f rom tax r e d u c t i o n
i n v e s t e d in inc r e a s e d p e r s o n a l savings, r a t h e r t h a n b e i n g
s p e n t to add" fuel to the i n f l a t i o n a r y fires,
W c are all k e e n l y
aware of our u n i t e d r e s p o n s i b i l i t y of i m p r e s s i n g u p o n the
publ i c the n e e d for saving a larger share of Current income.
The w h o l e t e nor of the U n i t e d States S e c u r i t y L o a n d r ive
is d i r e c t e d towards the e n c o u r a g e m e n t of p e r s o n a l savings in
'any p r a c t i c a l form.
We are not a c t i n g in c o m p e t i t i o n w i t h
o t her savings i n s t i t u t i o n s . The G o v e r n m e n t ' s p r i m a r y p u r p o s e
in p r o m o t i n g such savings is two-fold.
First, we are e n d e a v o r ­
ing to cut d o w n c o n s u m e r d e m a n d for -goods in short supply,
and to a b s o r b g e n e r a l l y those i n f l a t i o n a r y do l l a r s w h i c h are
a p o t e n t d a n g e r in our economy.
Second, we m u s t secure as
w i d e s p r e a d an own e r s h i p in G o v e r n m e n t securities as is possible,
in o r der to f a c i l i t a t e the m a n a g e m e n t of our n a t i o n a l debt and
insure a s t r o n g fiscal p o s ition.
I the r e f o r e h a v e no h e s i t a n c y
in a s k i n g that y o u bankers continue the fine support w h i c h y o u
h a v e r e n d e r e d the savings bon d p r o g r a m in the p ast - support
w h i c h I w e l l r e a lize has b e e n m a n y times f r e e l y g i v e n at
c o n s i d e r a b l e in c o n v e n i e n c e .
The p r e s e n t c a m p a i g n w i l l u n ­
d o u b t e d l y p r o v e h a r d e r to carry on t h e n those of the w a r years,
and d e f i n i t e l y w i l l require g r e a t e r efforts and a c t i v i t i e s
of p e o p l e in e v ery field of n a t i o n a l endeavor. -Here, then,
is a challenge -- one w h i c h you, as savings bankers, are
p a r t i c u l a r l y q u a l i f i e d to m e e t .
Xn the 132 years since the first M u t u a l Savings B a n k w as
f o u n d e d in this country, y o u r inst i t u t i o n s h a v e p l a y e d a
c o n s t r u c t i v e role in s e c u r i n g to the A m e r i c a n c i t i z e n his
en v i a b l e standards of living.
Y o u r organizations have grown
s t e a d i l y in size and in: importance, u n t i l today, w i t h a total
of 533 banks t h r o u g h o u t the U n i t e d States, w i t h d e p o s i t o r s
h'umbering 1 8 million, and w i t h total assets of over $20
billion, y o u r p o s i t i o n is one of u n q u e s t i o n e d influence.
Since t h e i r inception, the M u t u a l Savings B a nks h a v e a c t i v e l y
p a r t i c i p a t e d in the fiscal affairs of this G overnment, and
have o u t s t a n d i n g l y c o n t r i b u t e d to the f i n a n c i a l w e l f a r e of
the individual.
This r e c o r d of y o u r s p l e n d i d past a c h i e v e ­
m e nts is i n d i s p u t a b l e p r o o f that y o u w i l l e q ual and excel
y o u r p r e v i o u s efforts toward the p r o g r e s s and d e v e l o p m e n t
of this N a t ion.

0O0

of taxation the amount of discount at which Treasury bills are originally sold
by the United States shall be considered to be interest.

Under Sections l\2 and

117 (a) (1) of the Internal Revenue Code, as amended by Section ll£ of the Reve­
nue Act of 19U1, the amount of discount at which bills issued hereunder are sold
shall not be considered to accrue until such bills shall be 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, v/hether 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. I4I 8 , as amended, and this notice, prescribe
the terms of the Treasury bills and govern the conditions of their issue.
of the circular may be obtained from any Federal Reserve Bank or Branch.

Copies

_ |m

- 2 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 Secretary of the Treasury'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 ary such respect shall
be final.

Subject to these reservations, non-competitive tenders for $200,000 or

less without stated price from any one bidder Tvrill 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

Jn™» 3, 19k8____ j

in cash or other immediately avail-

able funds or in a like face amount of Treasury bills maturing
Cash and exchange tenders will receive equal treatment.

June 3. 19k8

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, shall not have any exemption, as such, and loss
from the sale or other disposition of Treasury bills shall not have any special
treatment, as such, under the Internal Revenue Code, or laws amendatory or supplemen­
tary thereto.

The bills shall be subject to estate, inheritance, gift

or other

excise taxes, whether Federal or State, but shall be exempt from all taxation newer
hereafter imposed on the principal or interest thereof by ary State, or ary of the
possessions of the United States, or by any local taxing authority.

For purposes

'Sxferrtoiky^r

TREASURY DEPARTMENT
Washington

FOR RELEASE, MORNING NEWSPAPERS,

Tuesday, May 25, 19R8.________

The Secretary of the Treasury, by this public notice, invites tenders for
$1,100,OOP,OOP

, or thereabouts, of

91

-day Treasury bills, for cash and

in exchange for Treasury bills maturing -----------^
June 3, 19l*8
--------------- , to be issued on
a discount basis under competitive and non-competitive bidding as hereinafter
provided.

The bills of this series will be dated

will mature

September 2, 19U8 , when the face amount will be payable without
x6obc
They will be issued in bearer form only, and in denominations of

interest.

June 3> 19b8

, and

$1,000, $5,000, $10,000,v$100,000, $^00,000, and $1,000,000 (maturity value).
Tenders will be received at Federal Reserve Banks and Branches up to the

d a y lig h t saving
closing hour, two o»clock p.m., Eastern/33BSsaB®Gi time,

Friday, May 28, 19l*8

Tenders will not be received at the Treasury Department, YJashington.

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 oh application
therefor.
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

T R E A S U R Y D E P A R T M E N T ________
Information Service

F O R RELEASE, M O R N I N G NEWSPAPERS,
Tuesday, M a y 25, 1 9 4 8 . ___ _____‘ '

Wa s h in g t o n , d .c .

No.

S-74l

The S e c r e t a r y of the T r e a s u r y / by this p u b l i c notice,
invites tenders f o r $1,100,000, 000,, or t h e r e a b o u t s of 9 1 -day
T r e a s u r y bills, for cash and in ex c h a n g e for T r e a s u r y bills
m a t u r i n g June 3, 19^8, to be issued on a d i s c o u n t basis u n d e r
c o m p e t i t i v e and n o n - c o m p e t i t i v e b i d d i n g as h e r e i n a f t e r p r o v i d e d .
The bills of this series w i l l be d a t e d June 3, 1948, a nd w i l l
m a t u r e S e p t e m b e r 2, 1 9 48/ w h e n the" face a m o u n t w i l l be p a y a b l e
without, i n t e r e s t , T h e y w i l l •be i s sued in b e a r e r f o r m only, and
in d e n o m i n a t i o n s of $1,000, $5,000, $10,000, $100,000, $ 5 0 0 ,0 0 0 ,
and $ 1 , 0 0 0 , 0 0 0 (maturity value).
T e n ders w ill be r e c e i v e d at F e d e r a l R e s e r v e B a nks and
B r a n c h e s up to the c l o s i n g hour, two o ' c l o c k p.m., E a s t e r n d a y ­
light s a v i n g time, Friday, M a y 28, 1948.- T e n d e r s w i l l n ot be
r e c e i v e d at the T r e a s u r y Department, W a s h i n g t o n .
Each tender
must, be for a n e v e n m u l t i p l e of $1,000, and in the case of
competitive- tenders the p r ice o f f e r e d m u s t be e x p r e s s e d on the
b a sis of 100, w i t h not m o r e tha n three decimals, e. g., 9 9 .9 2 5 .
F r a c t i o n s m a y not be used.
It is u r g e d that tenders be m a d e
on the p r i n t e d forms and f o r w a r d e d in the special e n v e l o p e s
w h i c h w i l l be s u p plied by F e d e r a l R e s e r v e B a n k s or B r a n c h e s on
a p p l i c a t i o n therefor.
Te n d e r s w i l l be r e c e i v e d w i t h o u t de p o s i t f r o m i n c o r p o r a t e d
banks and trust companies and from r e s p o n s i b l e and r e c o g n i z e d
d e a l e r s in inv e s t m e n t s e c u r i t i e s . Te n d e r s f r o m others m u s t be
a c c o m p a n i e d b y p a y m e n t of 2 p e r c e n t .of the face a m o u n t of
T r e a s u r y bills a p p l i e d for, u n less the tenders are a c c o m p a n i e d
b y a n express g u a r a n t y of p a y m e n t by an i n c o r p o r a t e d b a n k or
trust c o m p a n y .
I m m e d i a t e l y a f t e r the c l o s i n g hour, tenders w i l l be open e d
at the F e d e r a l R e s e r v e B a nks and B r a n c h e s , f o l l o w i n g w h i c h p u b l i
a n n o u n c e m e n t w i l l be m a d e by the S e c r e t a r y of the T r e a s u r y of
the a m o u n t and p r ice range of a c c e p t e d bids . T h ose s u b m i t t i n g
tenders w i l l be a d v i s e d of the a c c e p t a n c e or r e j e c t i o n thereof.
The S e c r etary of the T r e a s u r y e x p r e s s l y r e s erves the right to
a c c e p t or reject any or all tenders, in w h o l e or in part, and
hi s a c t i o n in a n y - s u c h r e s pect shall be final.
Subject to these
reservations, n o n - c o m p e t i t i v e tenders for $ 2 0 0 , 0 0 0 or less
w i t h o u t stated p r ice f r o m a n y one b i d d e r w i l l be a c c e p t e d in full
at the av e r a g e p r i c e (in three decimals.) of a c c e p t e d c o m p e t i t i v e

2
bids. Settlement for accepted tenders in accordance with the
bids must be made or completed at the Federal Reserve Bank on
June 3,.1948, in cash or other immediately available funds or
in a like face amount of Treasury bills maturing June 3> 19^8»
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 d e r i v e d f r o m T r e a s u r y bills, w h e t h e r interest
or g a i n f r o m the sale or o t her d i s p o s i t i o n . o f the bills, shall
not h a v e a n y exemption, as such, and loss f r o m the sale or
o t h e r •d i s p o s i t i o n of T r e a s u r y b i lls shall not h a v e an y special
treatment, as such, u n d e r the i n t e r n a l Revenue' Code, or laws
a m e n d a t o r y or s u p p l e m e n t a r y thereto.
The b i lls shall bé sub-*
ject to estate, inheritance, gift or o t h e r excise taxes,
w h e t h e r F e d e r a l or State, bu t shall be e x e m p t f r o m a l l t a x a t i o n
n o w or h e r e a f t e r i m p o s e d on the p r i n c i p a l or i n t e r e s t .t h ereof •
by a ny State, or a ny of the p o s s e s s i o n s o f the U n i t e d States,
o r by a n y local t a x i n g aut h o r i t y .
F o r pu r p o s e s of t a x a t i o n the
a m o u n t of d i s c o u n t at w h i c h T r e a s u r y bills are o r i g i n a l l y sold
b y the U n i t e d States shall be c o n s i d e r e d to be i n t e r e s t . U n d e r
S e c tions 42 and 117 fa) (l) of the I n t e r n a l R e v e n u e Code, as
a m e n d e d by S e c t i o n 115 of the R e v e n u e A c t of 1941, the amount
of d i s c o u n t at w h i c h bills issued h e r e u n d e r are sold shall not
b e c o n s i d e r e d to accrue u n t i l s u c h bills shall.be sold, redeemed
or o t h e r w i s e d i s p o s e d of, and such bills are e x c l u d e d f r o m con-"
s i d é r a t i o n as c a p i t a l assets-.
A c c o r d i n g l y , the o w ner of .'
T r e a s u r y b i lls (other- t h a n life In s u r a n c e companies) i s s u e d
h e r e u n d e r n e e d include in his income tax r e t u r n only the d i f f e r ­
ence b e t w e e n the ..price p a i d for such bills,, w h e t h e r on original
i s s u e or on s u b s e q u e n t purchase, a n d the a m o u n t a c t u a l l y r e ­
ceiv e d e i t h e r u p o n sale or r e d e m p t i o n at m a t u r i t y d u r i n g the
t a x able y e a r for w h i c h the r e t u r n is made, as o r d i n a r y g a i n or
loss.
T r e a s u r y D e p a r t m e n t Circular. No, 418,. as amended, and this
notice, p r e s c r i b e -the terms of t he T r e a s u r y b i l l s and g o v e r n
the c o n d i t i o n s of their issue.
Copies of the c i r c u l a r m a y be
o b t a i n e d f r o m an y F e d e r a l R e s e r v e B a n k or B r anch.

oOo

^ L i-

ior Rsmss, ì m m m w m m i m m 9
'Yassdfiar, Iter gl, 1948.

7fc» Seeretary ©f thè Tremaury aanouneeà l&st «r«ning thet ih© tender« for
#1,100,000,060» or theraaboute, of 91~day Treaaary bilia to be date* May 27 sud t© aitoul
August 86» 1948, wteieh «oro offered May 21, 1948, «or» epe&ed at th© Federai S « n m B&aki
od

May 84.

|

Th© dotali© of thia lisa» aro a© followa:
Total applied for * #1,727,980,000
Total aeoaptad
- 1,107,810,000

Arerà*© prioa

(include® #36,731,000 «nt©rad on a nonoompetitlr© basi© and aeoepted la fall
at th© arara^a prie© show» belo©}
* 99,748 Attiralent rata of discount approx* 0.997$ par annua

Smaga of aeeepted compatiiir© blda:
High

- 99.785 Sgairalaat rata of discount approx. 0.977$ par o a w
• 99.747
*
*
*
*
»
1.001$ »
»

Lev

(80 parcaat of thè amoaat bld for at thè lov prie© aas aeeepted}
Raderai Feserra
Diatriet

Total
Applied for

Total
Aeeepted

Boston
® w York
Philadalphla
Clerelaad
Richmond
Atlanta
Chicago
St. Lotti*
Minneapolis
Sansa* 0 1 %
Dallas
Saa Fraudano

#
13,240,000
1,493,466,000
£6,778,000
18,967,000
1,845,000
3,125,000
83,236,000
3,608,000
2,735,000
5,710,000
6,034,000
69,242.000

|

#1,727,980,000

#1,107,810,000

wtta.

12,990,000
934,216,000
19,275,000
11,317,000
1,845,000
5,125,000
65,711,000
3,455,000
2,535,000
5,610,000
5,989,000
41.742.000

ì«r®
tota

TREASURY DEPARTMENT
ILUfW

Information Service

I I IP ffyti U i l l W

W

H

WltiffllH g

Wa s h in g t o n , d . c .

17 ‘-v
N ° » S-742

F O R RELEASE, M S R N I N G N E W S P A P E R S
Tuesday, M a y 2 5 , 19^8,

The S e c r e t a r y of the T r e a s u r y a n n o u n c e d last e v e n i n g that
the t e nders for $ 1 ,1 0 0 ,0 0 0 ,0 0 0 , or t hereabouts, of 9 1 -day
T r e a s u r y hills to'be dated M a y 27 and to m a t u r e A u g u s t 26, 1948,
¥ h i c h w e r e o f f ered M a y 21, 1948, w e r e o p e n e d at the F e d e r a l
Reserve
B a nks on M a y 2.4,
The d e t ails

of this issue are as follows:

T o t a l a p p l i e d for-* $ 1 , 7 2 7 , 9 8 0 , 0 0 0
T o tal a c c e p t e d
1,107,810,000
(includes $ 3 8 , 7 3 1 , 0 0 0 e n t e r e d
on a n o n - c o m p e t i t i v e basis and a c c e p t e d in
full at the a v e rage p r i c e s h o w n below)

Average price - 99.748 Equivalent rate of discount approx. 0.997$
per annum

Range of accepted competitive bids:
H i g h - 99.753 Equiv.
Low
- 99.747
"

: ate of d i s c o u n t a p p r o x
11

tr

tt

n

O. 9 7 7 $ p e r a n n u m
1.001$
"
"

( 5 0 p e r c e n t of the a m 1 n t b id for at the low p r i c e was accepted)
Federal Reserve
District

Total
A p p l i e d for

Total

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
S t , Louis
Minneapolis
K a n s a s City
Della's
S an F r a n c i s c o

$

$

TOTAL

13,240,000
1,493,466,000
2 6 ,7 7 5 , 0 0 0
1 8 .9 6 7 . 0 0 0
1.845.000
3 .1 2 5 . 0 0 0
8 3 .2 3 6 . 0 0 0
3 ,6 0 5 , 0 0 0

A c c e p t e d ______

1 2 ,9 9 0 , 0 0 0
934,216,000
19.275.000

.

1 1 317.000
1.845.000
3 .1 2 5 . 0 0 0

65 ,711,000
3.455.000

.

2 ,735,000
5 ,710,000

2 535.000

6,034,000
69.242.000

5,989,000
41,742,000

$1 ,7 27,980,000

$ 1 , 107 , 810,000

0 O0

5 ,6 1 0 , 0 0 0

Stier

(release for distribution at press conference
Wednesday, May 26 )

I M M E D I A T E RELEASE

Wednesday, May 26, 1948

No. S - 7 * 0

I n ueihaJT'ftu venae

a reminder that

C o m m i s s i o n e r ■flchoenciaan
fitoae-ctw

today issued

it is now time for several million persons

to revise their quarterly payments of estimated income tax
in accordance with the reduced rates of the Revenue Act
of 1 9 ^.
Since these people had to estimate their 19^-S tax
on March 15, before Congress lowered the rates, they
probably estimated under the old law, paid one installment
on that basis, and have another installment coming due
June 15«
Collectors1 offices have mailed bills for the June
installments An
But

accordance with the original estimates.

also

mailed new estimate forms

those taxpayers who wish to

to be used by

take advantage of the reduced

tax rates by filing amended estimates.
If an a m e n d e d

estimate is filed,

the J u n e

15 payment

m a y be m a d e in a c c o r d a n c e w i t h it.

The average wa,ge earner is not concerned with e stimates
since he pays all or nearly all of his income tax, as a rule,
through the withholding system.

oOo

TREASURY DEPARTMENT
Information Service

Wa s h in g t o n , d .

F O R I M M E D I A T E RELEASE.
Wednesday» M a y 26, 1948.

No.

G e o r g e J. Schoeneman,

C o m m i s s i o n e r of Interna,! Revenue»

t o day issu e d a r e m i n d e r that it is n o w time
million persons
mated

to revise

for several

their q u a r t e r l y p a y m e n t s

of e s t i ­

income tax in acc o r d a n c e w i t h the r e d u c e d rates

Revenue Act

S-743

of the

of 1948-.

Since these p e ople h a d to .estimate t h e i r 1948 tax on
M a r c h 15» b e f o r e Congress

l o w ered the rates,

e s t i m a t e d u n d e r the old law,
basis,

p a i d one i n s t a l l m e n t

and h a v e a n o ther inst a l l m e n t

Collectors'
stallments

they probably
on that

c o m i n g due J une 15.

offices h a v e m a i l e d b i lls

for the J une

in a c c o r d a n c e w i t h the o r i g i n a l e s t i m a t e s .

they also m a i l e d n e w e s t imate forms
p a y e r s w h o w i s h to take a d v a n t a g e

to be used b y those

in­
But
tax­

of the r e d u c e d tax rates

by f i l i n g a m e n d e d e s t i m a t e s .
If an a m e n d e d estim a t e
be m a d e

is filed,

the June 15 p a y m e n t m a y

in a c c o r d a n c e w i t h i t .

The a v erage w age e a r n e r is no t

c o n c e r n e d w i t h estimates,

since he p ays all or n e a r l y all of h i s
t h r o u g h the w i t h h o l d i n g system.
oOo

income tax,

as a rule,

- 9

Chairman * Mr* Ed Leigh Mc M i l l a n ,

-

and others in the Savings Bo ndj|

organization, have had the support of all segments o f ^ S S s state —

from financial leaders, from business and professional men, from

civic and service o r g a nizations, from schools, from labor and

agriculture*

W e are entering the critical, final period of this Security

Loan Campaign, the period in which success must be attained*

I

am sure -that I -earn speak for Secretary Snyder and for U n i t e d States
Savings Bonds Division Director Vernon/ Clark, in conveying the

very sincere appreciation of the Treasury Department to all of

you who are serving so unselfishly.

May I ask your continued vigorous effort for a victorious

conclusion here in your state*

Alabama was one of the leaders

among the states in the various W a r Loans*

will not do less in the Security L o a n .

W e are confident you

......

■

'

: '

1I t
■ v H

own security;

it Is giving the philosophy of thrift an even
1

stronger h o l d u p o n the American character.

Th e s e are the reasons w h y your Government believes the

peacetime Savings Bond program, as formulated in the S e curity

Loan Campaign, is good for the Bat Ion, good f o r the community, and

good for o ur citizens*

T hree is a most encouraging understanding

of the n e e d for thie program*

There Is an equally fine apprecia­

tion of the merits of Savings Bonds h e l d for personal security*

But f o r this Campaign to be successful we bond salesmen,

and 1 hope I m a y include those of you here today in that category,

m u s t do a real job of carrying the opportunity to Invest to

every potential bond buyer#

T o n have a fine volunteer organisation here In Alabama*
of your

And X. want -to- say to— yo u that the fact that so m a n y / busy eifrisett*
people - busy as they are with other tasks -

lites yoursel v es are/jyggjf to give t heir time and energies to

this program is to m e eloquent testimony to the inherent strer*£h

of

Hation*

S t a t e Director, Mr* Y o u n g J. Boozer, and

State

• 7 <•
and Industrial development principally in terns of such specta­
cular fields as electronics and nuclear physics*

These fields,

of course, offer opportunities for industrial development, the
seope of which we are only beginning to realise*

But we are

still far from developing the full induatrial potentialities
of basic scientific discoveries which date back years, and
even generations*

The plastics industry, for example, is still

in a highly dynamic state, although the basic scientific idea
is far from new*
To meet this challenge of the future, we need, not merely
imagination and managerial skill, but capital as well.

This

capital can be accumulated only by the time-honored processes
of saving and investing*

The purchase of Savings Bonds diverts

a portion of the Income of the community from current consumption,
and ao makes it possible to accumulate this capital without
contributing to Inflationary pressures.

In offering the best

and safest of all Investments to its people, your Government
an

.

is not only offering the indivlduals/opportunity to further 8jea r

7

6
fiscal years.

T h e great bulk of this reduction haa been in the

debt h e l d by the banking system.

Further substantial sales

of Savings Bonds provide a means of continuing with that debt

dispersal operation,en$f»e strengthening o u r financial position.

In these critical times, the strongest possible financial

position Is as important to o u r Government and our people as

the strongest possible national defense structure#

Th e r e is one other phase of the Savings Bond p r o g r a m that

is deserving of attention.

It is a contribution to thrift

consciousness o n the part of the Ame r i c a n people.

This Bat Ion

has attained its present greatness through the combination of

vaat natural resources, the energy a n d vision of our people, and

the application of the wise tenet of ”aave and invest,w
that
It m a y be thab, as some have con tended,/we have approached

the geographical and resource limits of our frontier; we certainly
even
have not reached or/approached the frontier of development in

scientific and industrial achievement,

W e tend to think of the possibilities of future scientific

«*

§

.« *

sale of Savings Bonds provides the means for a continuing reduc­

tion in the amount of debt h e l d by the banking system*

This

shrinks the money supply, and so exercises a particularly, strong

restraining influence on prices*

This shifting of a portion of the public debt from the

banking system to private individuals is a part of the complex

operation known as "DJ^bt Management*1*

O u r huge, war— created

public indebtedness constitutes on© of the moat important problems

of Government today*

Most authorities are agreed that now, while o u r national

income is at record levels, efforts should be made to reduce the

total of this Federal debt, and that this indebtedness should be

spread as wide l y as possible to insure a strong Federal financial

structure*

. / :i|

T h e peak of our wartime debt, of some $280 billions, has

been reduced to about $252 billions through the use of the cash

balance in the Tre a s u r y after the Victory loan, and the surplus

of receipts o v e r expenditures accumulated during the last two

continuation of the Payroll Plan, and by the fairly new Bond-a-

Honth Plan operated by the banks, has brought the total of

Savings Bonds outstanding to a new all-time high level*

Al l Savings Bonds outstanding on April 30, 1948

# 5 3 •1 billion*

That is more than the American people owned at

any time during the war or since*

It is more than the total

i
years
national personal income for either of the

6sftfr 1932

The dollar value of Series E Bonds outstanding on April 30,
-

v^
1948, was $31*6 billion, an all-time record.. This is equal to

the total income for nearly two months of every man, woman and

chi^ld in the Unit e d States
you people

Here in the State of Alabama

of Savings Bonds of all series, and these bonds

at an annual rate of #13 million in interest.
v fllp lll •\ ■ 4%

own $457 million

are appreciating

I do not need to

tell you businessmen what these savings can mean as a stabilizing
on
influence

the economy of your state.

In addition to diverting funds from the spending stream, the

• 3

in helping to maintain a sound economy, and in contributing to
healthy debt management

a/atrong Federal financial position*

These are goals we must

as part of our responsibility not only to our own

achleve/4^- we are-to moot the -w e a p o n s ¿bill-ties, e g ,this N a tion

be-" ite

but to the rest of the world as well.
p e o p l e ,/ é é ê .t e W ..ix»apfw.3..hl,i i

$4 ^ ,

powerful

First, money invested now in Savings Bonds is taken from
the spending stream; it ceases to compete for scarce goods at
rising prices*

This purchasing power is stored up; it grows
is bound

with tne accrual of Interest*

This reservoir of ^^vtngs

to be
an important bulwark for our economy*
I doubt that we can fully comprehend the magnitude and
Importance of this backlog of Savings Bond assets as it relates
to future business trends*

The figures are an eloquent testi­

monial to the appreciation the American public has for United
States Savings Bonds as an investment*
Hot only have the bonds purchased as a part of our war effort
been wisely used and wisely held to a surprising extent; but
also our peacetime program, represented heretofore by the

2

7 ¡J

w© are In the midst of tfe© Security Loan Drive because of signi­

ficant national and international developments, the nature of

which was not manifest at that earlier time.

V¥e could not realize then the extent of the expenditures

that are n o w necessary for our national security and for the

reconstruction of those countries which lost so much In the war

and which n o w stand by our side in a world still t o m by conflict

and ideological strife.

We could not foresee then the persistence and extent of the

Inflationary forces that continue to threaten our economic

security.

The impact of our military spending, as typified by

the ”70-Group A i r For c e ” and other extremely large items in our

preparedness budget, is falling upon an economy still unable,

In

man y respects, to meet fully the civilian needs and wants of

our people.

Adding to these pressures will be the expenditures

for
-9^ the European H e covery Program*

7/

address myself to
So today I should like to /talk with you ©a the part the

Security Loan can play in alleviating these Inflationary pressures

Address by Assistant Secretary of the Treasury, Edward H* Foley, Jr.,
before fce Savings Bond rally at B i r m i n g h a m , Alabama,/Friday, May 28, 1948.
on

Some eighteen months ago I had the pleasure of addressing
another Birmingham audience In behalf of our peacetime Savings
Bond program.

It was at a Federal Reserve-sponsored Industry

dinner, one of several such meetings held throughout the country.
Some of you here today may have been at that earlier meeting,
when my subject was, "Th© Present Day Objectives of the Payroll
Savings Plan.”

I discussed this subject at several similar

meetings In other southern states.
I think the representatives of Industry present at those
meetings were pretty well in agreement with the Treasury Departthe belief
ment in fooling that the Savings Bond program had a definite
place in the peacetime fiscal operations of the Government, i s and

/

in addition contributed
wel l —as■yloldiRg-considerable benefit from the standpoint of
the public welfare.
t

I doubt, though, that many of us at that time were thinking
in terms of a full-fledged Savings Bond campaign.

Yet today

TREASURY DEPARTMENT
WASHINGTON, D .C.

Information Service

Statement by Secretary Snyder for Press Conference at
Hotel Traymore, Atlantic City, N. J #, May 24, 1948

The Security Loan Drive is doing well, and New Jersey is an
excellent example to cite.
Volunteer salesmen have canvassed more than 300,000 industrial
workers of this State since the drive started, encouraging them to
buy bonds through the Payroll Sayings Plan.

I am told 200,000 more

workers m i l receive personal visits before the drive ends.
Payroll Savings Plan participation has jumped to 62 percent at
the RCA Victor plant in Camden, 50 percent at the Prudential Insurance
Company in Newark, and 50 percent at the Botany hills in Passaic,
§ome 40 New Jersey concerns
after the war have reinstated it.

which

dropped the Payroll Sayings Plan,

Management and labor share the

credit for this fine shoring,
Every county in New Jersey has a complete volunteer bond sei3-ing
organization.

This State is putting real punch into its Security Loan

campaign, We hope to see the State sales goal of 086,400,000 surpassed.

oOo

>

.

JfliiCiuP*, . ^

t

, «. ,s-

•

/ >

--•

■» . ; _ -

#

The follow^fig address by Assistant Secretary antaBgi Edward H. Foley, J?
before twe Savings Bond rally/ at the Tutweiler Hotel,
Birmingham. Alabama, is scheduled for delivery at 1* P*,M.,
E«S.T..May 28, 1948, and is for release at that time,

/ f I

TREASURY DEPARTMENT
Washington

T h e f o l l o w i n g address by A s s i s t a n t S e c r e t a r y
E d w a r d H. Foley, Jr., b e f o r e a Savings B o n d r a l l y
at the T u t w e i l e r Hotel, B i r m ingham, A l a b a m a , is, ’
sc h e d u l e d f or d e l i v e r y at 1:00 P.M., C.S.T.,
M a y 2'8V 1948, and is for r e l ease at* that time.

Some e i g h t e e n m o n t h s ago I h a d the p l e a s u r e of a d d r e s s i n g
a n o t h e r B i r m i n g h a m a u d ience in b e h a l f of our p e a c e t i m e Savings
B o n d p r o gram.
It was at a F e d e r a l R e s e r v e - s p o n s o r e d i n d u s t r y
dinner, one of several such m e e t i n g s h e l d t h r o u g h o u t the
country.
Some of y o u h e r e today m a y h a v e b e e n at that e a r l i e r
meeting, w h e n m y subject was, "The Pr e s e n t D a y O b j e c t i v e s of
the Pa y r o l l S a v i n g s ^ P l a n . " X d i s c u s s e d this subject at several
s i m i l a r m e e t i n g s in other s o u t h e r n states.
I t h i n k the r e p r e s e n t a t i v e s of i n d u s t r y p r e s e n t at those
m e e t i n g s w e r e p r e t t y w e l l in a g r e e m e n t w i t h the T r e a s u r y
D e p a r t m e n t in the b e l i e f that the Savings B o n d p r o g r a m h a d a
d e f i n i t e p l a c e in the p e a c e t i m e fiscal o p e r ations of the G o v e r n
ment, and i n . a d d i t i o n c o n t r i b u t e d c o n s i d e r a b l e b e n e f i t f r o m
t h e ‘s t a n d p o i n t of the p u blic w e l f a r e .
I doubt, though, that m a n y "of us at that time wer e t h i n k ­
ing in terms of a f u l l - f l e d g e d Savings B o n d campaign.
Yet
t o day we are in the m i d s t of a S e c u r i t y L o a n D r i v p b e c a u s e of
s i g n i f i c a n t n a t i o n a l and i n t e r n a t i o n a l devel o p m e n t s , the
n a t u r e of w h i c h was not m a n i f e s t at that ea r l i e r time.
W e could not r e a lize t h e n the e x tent of the e x p e n d i t u r e s
that are n o w n e c e s s a r y for our n a t i o n a l se c u r i t y and for the
r e c o n s t r u c t i o n of those countries w h i c h lost so m u c h in the
w a r and w h i c h n o w stand by our side in a W o r l d still t o r n
by c o n flict and i d e o l o g i c a l s t r i f e .
W e could not foresee t hen the p e r s i s t e n c e and e x tent of
the i n f l a t i o n a r y forces that continue to t h r e a t e n our e c o n o m i c
security.
The impact of our m i l i t a r y spending, as t y p i f i e d by
the "70-Group A i r F o r c e " and o t her e x t r e m e l y large Items in
our p r e p a r e d n e s s budget, is f a l l i n g u p o n an e c o n o m y still
unable, in m a n y respects, to m e e t f u l l y the c i v i l i a n needs
and w a n t s of our people.
A d d i n g to these p r e s s u r e s w i l l be
the e x p e n d i t u r e s for the E u r o p e a n R e c o v e r y Program.

S-744

n

-

2

-

So t o day I should like to address m y s e l f to the par t
the S e c u r i t y L o a n can p l a y in a l l e v i a t i n g these i n f l a t i o n a r y
p r e s s u r e s jin h e l p i n g to m a i n t a i n a sound economy, and in
c o n t r i b u t i n g to a h e a l t h y debt m a n a g e m e n t pos i t i o n .
These
are goals we m u s t achieve as p art of our r e s p o n s i b i l i t y not
only to our o wn people, but to the rest of the "world as well.
First, m o n e y invested n o w in Savings B o n d s is t a k e n f r o m
the s p e n d i n g stream; it ceases to compete for scarce goods at
r i s i n g prices.
This p u r c h a s i n g p o w e r is s t ored up; it grows
w i t h the a c c r u a l of interest.
This r e s e r v o i r of savings is
b o u n d to be an i m p o rtant b u l w a r k for our economy.
I doubt that we can fully c o m p r e h e n d the m a g n i t u d e and
i m p o r t a n c e of this b a c k l o g of Savings B o n d assets as it r e ­
lates to future b u s i n e s s trends.
The f i gures are a n e l o q u e n t
t e s t i m o n i a l to the a p p r e c i a t i o n the A m e r i c a n p u b l i c has for
U n i t e d Sta,tes Savings Bonds as a n investment.
N o t onl y h a v e the bonds p u r c h a s e d as a par t of our w a r
e f f o r t b e e n w i s e l y use d and w i s e l y h e l d to a s u r p r i s i n g extent;
but also our p e a c e t i m e program, r e p r e s e n t e d h e r e t o f o r e b y the
c o n t i n u a t i o n of the Payroll Plan, and by the f a irly n e w B o nda - M o n t h P l a n o p e r a t e d by the banks, has b r o u g h t the t o tal of
Savings B o n d s o u t s t a n d i n g to a n e w all - t i m e h i g h level.
A l l Savings B o nds o u t s t a n d i n g
w o r t h $ 5 3 .L billion.
That is m o r e
owned at any time d u r i n g the w a r or
t o tal n a t i o n a l persona,! income for
or 1933.

on A p r i l 30* 1948, were
t han the A m e r i c a n p e o p l e
since.
It .is m o r e t h a n the
e i t h e r of the yeo-rs 1 9 3 2

The d o l l a r value of Series E Bonds o u t s t a n d i n g on A p r i l 30,
1948, was $31.6 billion, an a l l -time record.
This is equal
to the total income for n e a r l y two m o n t h s of e v e r y man, w o m a n
and child In the U n i t e d S t a t e s .
H e r e in the State of A l a b a m a y o u p e o p l e o wn $ 4 5 7 m i l l i o n
of Savings B o nds of all series, and these bonds are a p p r e c i a t i n g
at an a n n u a l r a t e of $13 m i l l i o n in interest.
I do n ot n e e d to tell y o u b u s i n e s s m e n w h a t t h e s e ' s a v i n g s c an m e a n as a s t a b i l ­
i z i n g inf l u e n c e on the e c o n o m y of y o u r state..
In a d d i t i o n to d i v e r t i n g funds f rom the s p e n d i n g stream,
the sale of Savings Bonds p r o v i d e s the m e a n s for a c o n t i n u i n g
r e d u c t i o n in the amount of debt h e l d by the b a n k i n g system.
This shrinks the m o n e y supply, and so exe r c i s e s a p a r t i c u l a r l y
stro n g r e s t r a i n i n g i n f l uence on p r i c e s .
The s h i f t i n g of a p o r t i o n of the p u b l i c debt f r o m the
b a n k i n g s y s t e m to p r i v a t e i n d i v i d u a l s is a p a r t of the c o m p l e x

3
o p e r a t i o n k n o w n as "Debt M a n a g e m e n t ."
Our huge, w a r - c r e a t e d p u b l i c indeb t e d n e s s constitutes one of the m o s t im p o r t a n t p r o ­
blems of G o v e r n m e n t t o d a y .
M o s t a u t h o r i t i e s are a g r e e d that now, w h i l e our n a t i o n a l
income is at r e cord levels, efforts should be m a d e to redu c e the
total of this F e d e r a l debt, and that this i n d e b t e d n e s s s h ould be
spread as w i d e l y as p o s s i b l e to insure a s t r o n g -F e d e r a l f i n a n c i a l
structure.
The p e a k of our w a r t i m e debt, of some $ 2 8 0 billions, has
b e e n r e d u c e d to about $ 2 5 2 billi o n s t h r o u g h the use of the cash
b a l a n c e in the T r e a s u r y a f ter the V i c t o r y loan, and the surplus
of receipts o v e r e x p e n ditures a c c u m u l a t e d d u r i n g the last two
f i s c a l y e ars * The great b u l k of this r e d u c t i o n has b e e n in the
debt h e l d b y the b a n k i n g system.
F u r t h e r s u b s t a n t i a l sales of
Savings B o nds p r o v i d e a means of c o n t i n u i n g w i t h that debt
d i s p e r s a l operation, thus s t r e n g t h e n i n g our f i n a n c i a l p o s i t i o n .
In these critical times, the s t r o ngest p o s s i b l e f i n a n c i a l
p o s i t i o n is as important to our G o v e r n m e n t a n d our p e o p l e as the
str o n g e s t p o s s i b l e n a t i o n a l de f e n s e structure*
T h e r e is one o t her p h ase of the Savings B o n d p r o g r a m that
is d e s e r v i n g of a t t e n t i o n .
It is a c o n t r i b u t i o n to thrift
c o n s c i o u s n e s s on the hart of the A m e r i c a n p e o ple.
This N a t i o n
has a t t a i n e d its p r e s e n t greatness t h r o u g h the c o m b i n a t i o n of
vast' n a t u r a l resources, the e n e r g y and v i s i o n of our people, and
the a p p I d e a t i o n of the w i s e tenet of "save and i n v e s t ."
It m a y be, as some hav e contended, that we h a v e a p p r o a c h e d
t h e ,g e o g r a p h i c a l and resource limits of our frontier; we c e r t a i n l y
h a v e n ot r e a c h e d or e v e n - a p p r o a c h e d the f r o n t i e r of d e v e l o p m e n t
in scie n t i f i c and i n d u strial a chievement.
W e tend to t h i n k of the p o s s i b i l i t i e s of future sci e n t i f i c
and i n d u s t r i a l d e v e l o p m e n t p r i n c i p a l l y in terms of such s p e c t a ­
cular fields as e l e c t r o n i c s and n u c l e a r physi c s .
T h e s e fields,
of course, offer oppor t u n i t i e s for i n d u s t r i a l deve l o p m e n t , the
scope of w h i c h we are only b e g i n n i n g to realize,
But we are
still far f r o m d e v e l o p i n g the full i n d u s t r i a l p o t e n t i a l i t i e s
of b a s i c s c i e n t i f i c d i s c o v e r i e s w h i c h date b a c k years, and
even generations.
The pla s t i c s industry, f or.example, is still
in a h i g h l y d y n a m i c state, a l t h o u g h the b a s i c s c i e n t i f i c idea is
far f r o m new.
To m e e t this challenge of the future, we need, n ot m e r e l y
i m a g i n a t i o n and m a n a g e r i a l skill, but c a p ital as well.
This
capital can be a c c u m u l a t e d onl y b y the t i m e - h o n o r e d p r o c e s s e s
of s a v i n g and investing.
The p u r c h a s e of Savings B o n d s di v e r t s
a p o r t i o n of the income of the c o m m u n i t y f r o m current c o n s umption,
and so m a k e s it p o s s i b l e to a c c u m u l a t e this capital w i t h o u t
c o n t r i b u t i n g to i n f l a t i o n a r y p r e s s u r e s .
In o f f e r i n g the best and
safest of all i n v e s t m e n t s to its people, y o u r G o v e r n m e n t Is n ot
only o f f e r i n g the i n d i viduals an o p p o r t u n i t y to f u r t h e r t h e i r own
security; It is g i v i n g the p h i l o s o p h y of thrift a n e v e n s t r o n g e r
hold, u p o n the A m e r i c a n character.

- h -

T h e s e are the reasons w h y y o u r G o v e r n m e n t b e l i e v e s the
p e a c e t i m e Savings B o n d program, as f o r m u l a t e d in the S e c u r i t y
L o a n Campaign, is good for the Nation, goo d for the community,
a nd good .for our citizens.
There is a m o s t e n c o u r a g i n g
u n d e r s t a n d i n g of t h e 'need for this pro g r a m .
T h e r e is an e q u a l l y
fine a p p r e c i a t i o n of the m e r i t s of Savings B o n d s h e l d for
p e r s o n a l security.
B ut for this C a m p a i g n to be s u c c e s s f u l we b o n d salesmen,
and I h o p e I m a y Include those of y o u h e r e t o d a y in that
category, m u s t do a real job" of c a r r y i n g the o p p o r t u n i t y to
invest to e v e r y p o t e n t i a l bon d buyer.
Y o u h a v e a fine v o l u n t e e r o r g a n i z a t i o n h e r e in A l a b a m a .
The fact t h a t so m a n y of y o u r p e o p l e - b u s y as t h e y are w i t h
o t h e r tasks - are w i l l i n g to give t h eir time and en e r g i e s to
this p r o g r a m is to me e l o quent t e s t i m o n y to the inherent
s t r e n g t h of our Nation.
Y o u r State Director, Mr. Y o u n g J.. Boozer, and y o u r State
Chairman, Mr. E d L e i g h McMillan, and others in the Savings
B o n d organization, h a v e h a d the support of all segments of
y o u r state -- from f i n a n c i a l leaders, fro m b u s i n e s s a nd p r o ­
f e s s i o n a l men, fro m civic and. service organizations, f r o m
schools, f r o m labor and a g r i c ulture.
W e are e n t e r i n g the critical, final p e r i o d of this
S e c u r i t y L o a n Campaign, the p e r i o d in w h i c h success m u s t be
attained.
I a m sure 1 s p e a k fo r S e c r e t a r y S n y d e r and for
U n i t e d States Savings Bonds D i v i s i o n D i r e c t o r V e r n o n Clark,
in c o n v e y i n g the v e r y sincere a p p r e c i a t i o n of the T r e a s u r y
D e p a r t m e n t to all of y o u w ho are s e r v i n g so u n s e l f i s h l y .
M a y I a s k y o u r c o n t i n u e d vigorous, e f f o r t for a v i c t o r i o u s
c o n c l u s i o n h e r e in y o u r state.
A l a b a m a was one of the leaders
a m o n g the states in the v a r i o u s W a r L o ans.
W e are con f i d e n t
y o u w i l l not do less in the S e c u r i t y Loan.

0 O0

^

ffe

Com parison o f p r in c ip a l item s o f a s s e ts and. l i a b i l i t i e s o f n a tio n a l tanka - c o n t i n u e d
( I n thousands o f d o lla r s )

:
:

Apr. 12,
1948

•
: Dec. 31,
:
19^7
•

LIABILITIES
Deposits of individuals, partnerships and corporations:
Demand..............
$45,13M37
Time...............
18,767,225
Deposits of U. S. Grovernment•••• •
1,526,220
Postal savings deposits..
2,803
Deposits of States and political
subdivisions...................
4,907,268
Deposits of banks............. ..
7,03^,821
Other deposits (certified and
cashiers * checks, e
t
c
.
1.094.772
Total deposits...........
78,4o7,24o
Bills payable, rediscounts and
other liabilities for borrowed
1 5 2 .3 1 5
money.......... ............. «
769.669
Total liabilities, excluding
79.389.230
CAPITAL ACCOUNTS
Capital stock:
Preferred............. . •••
25.235
Common stock..............
1 .7 7 4 .7 13
11799.948'
2,419,482
Surplus.........................
961,790
Undivided profits..............
357.448
Total surplus, profits, and
3.738.720
reserves................
5.538.568
Total capital accounts.....
Total liabilities and cap­
84.927.898
ital accounts••♦••••••••••
Ratios:
Percent
U.S.GovH securities to total assets
43.51
Loans and discounts to total assets
2 5.69
Capital accounts to total deposits
7.06
HOT!*. Minus sign denotes decrease.

: June 30,
:
1947

:Increase or decrease:Increase or decrease
¡since Dec. 31. 1947 ¡since June 30 . 1947
:

Amount

¡Percent;

Amount

¡Percent

“6 .1 3
.02
69.6 6
-I.3&

$3 8 3 ,12 7
2 10 ,6 19
6 5 8 ,17 1
-1

.86
1.14
75.82
-.04

4 ,5 6 2 ,7 16
7 ,433,963

180,935
3.83
-1 ,3 76 ,6 52 -1 6 .3 7

3 ^ ,552
-399,142

7.55
-5.37

1 .3 9 1.8 9 7______ 1 .222.001
82,275,35b
77,397,1^9

-297.125 -21.35
-3,808,110 = 0 3

-127.229
1,070,097

-10.41
1.38

$48,079,210
18,764,017
899,585
2,841

$**4,751,010
18,556,606
868,049
2,804

4,726,333
8,411,473

-$2,9^5,073
3,208
626,635
-3?

4 5 .1 3 5
705.185

27,860
6 7 9 .5 7 1

107,180
64.484

237.47
9.14

124,455
90.098

446.72
13.26

83.025,676

78.104.580

-3 .636.446

-4.38

1.284.650

1.64

27,440
1.752.326
1.779.766 ^
2 .399.520
893,232
348.806

28,359
1.742.512
1.770.871
2 .3 2 9 .9 5 1
874,798
333,060

-2,205
22,387
20.182
19 ,9 6 2
68,558
8.642

-8.04
1.28
1 .1 3
.83
7.6 8
2.48

-3,124
32.201
2 9 .0 77
89,531
86,992
24.388

-11.02

3.641.558
5.421.324

3.537.809
5.3081680

9 7 .16 2
117Í344

2.67
2.16

200.911
229.988

5.68
fr.33

88.447.000

83.413.260

-3.519.102

-3.98

1.514.638

1.82

Percent
43.90
2 4 .2 9
6 .5 9

Percent
4 7 .2 7
22.55
b.86

1-85
I .64
3.84
9.94
7.32

n

Statement showing comparison of principal items of assets and liabilities of active national banks
as of April 12, 1948, December 31, 1947, and June 30, 1947
(in thousands of dollars)
Increase or decrease«Increase or decrease

t
• 1948
1
e
Humber of banks .,...............
ASSETS
Loans and discounts, including
overdrafts............. .......
U.S.Government obligations.
direct and guaranteed.........
Obligations of States and political subdivisions.............
Other bonds, notes,and debentures
Corporate stocks, including
stocks of federal Reserve banks
Total securities...........
Total loans and securities..
Currency and coin...... ........
Reserve with federal Reserve ,banks
Balances with other banks.......
Total cash, balances with
other banks, including reserve balances and cash items
in process of collection....
Total assets...............

'

•
•
•

19^7

=
•
•

191+7

1.56
-4.82

$3,006,335
...
-2,469,958

1+.75
-1.88

271,616
65,826

155.338
W+.378 ,6 57

11+3,990
-37.535
„
1.706
-1 .7 6 1.6 2 7

6 3 ,188 ,663
988,288

-1 .1+2 5 .71+1
-80,720

-2.18

$21,816,341

$21,480,457

36.955.W7

3«. 825 > 3 5

3,172,597
1,962,559

3,028,607
2 ,000,094

2,900,981
1 ,896,733

157.536
l+2.2*+8.339

155.830
44.009.966

64.064.680

65.1+90.1+23
l,l6S,042

7.773.739

19.923.t o
939.797
8^,927,898

5,018

3

1
$335,884
$1 8 ,810,006
~
.
39 > 2 5 ,605 -1,869,788

10,623,726
-632,575
11 ,691+,935
9 .212.613 __ 7.783,534 _ -1.438.874

22.075.590
880.987
88,1(1+7,000

¡Percent
-4

5 ,0 1 1

1,087,322

:Percent \ Amount
•

Amount

.06

5,01*

11 ,062,360

:
•
e

19.395,5^8
829.01+9
83,413,260

-2.152.169
58.810
-3,519.102

-.08

_
15.98

,

^

-6.26
9?6
3.47

_
1.09
-4.00

-2.130.318

1.41
—4.80

876.017
99,031+

1 .3 9
10.02

-6 .9 1
1+38,63++
-5.1+1
-15.62 ____ -9.795

-9.75
6.68
-3-98

527.873
110.71+8
i,5li+,638

1+.13
-13

2.72
13.36
1.82

-

decrease of $2,500,000,000, or

6

2

-

percent, since June.

Obligations of States and

political subdivisions held in April amounted to $3»173»000,000, an increase of
$144,000,000 over the December figure, and other securities held were
$ 2 ,120 ,000 ,000 , a decrease of $ 36 ,000 ,000 .
Cash of $1,087,000,000, balances with other banks (including cash items in
process of collection) of $7,774,000,000, and reserves with federal Reserve banks
of $ 11 ,062 ,000 ,000 , a total of nearly $20 ,000 ,000 ,000 , decreased more than
$2,000,000,000 since December

31.

Uhe unimpaired capital stock of the banks on April 12, 1948 was $1,800,000,000,
including $25,000,000 of preferred stock.

Surplus was $2,420,000,000, undivided

profits $962,000 ,000 , and reserves $ 357 ,000 ,000.

Total capital accounts of

$5*539*000,000 were $117,000,000, or 2 percent, more than in December last.
United States Government securities were
April 12, and loans and discounts were

25.69

accounts to total deposits was J * 0 6 percent.

43.51

percent of total assets on

percent*

The percentage of capital

TR&fcSUIKT DEFARTEg&T
f§£ r e l e a s e , m o v i n g n e w s p a p e r s
Thursdays May 27g 1948

lo. 4 - 7 <*i‘

The total assets of national banks on April 12 of this year amounted to
$85,000,000,000, it m s announced today by Comptroller of the Currency Preston
Delano*

The returns from the call covered the 5 *0l4 active hanks in the United

States and possessions.

The assets were $3,500,000,000, or nearly 4 percent, less

than reported hy the 5,011 active hanks as of December 31, 19^7» the date of the
previous call, hut were $ 1 ,500 ,000 ,000 , or nearly

2

percent, above the amount re­

ported hy the 5,018 active hanks as of June 3°» 13^7*
The deposits of national hanks on April 12, 1948 were nearly $78,500,000,000,
which m s a decrease of $3,800,000,000 since December, hut an increase of more than
$1,000,000,000 since June of last year.

Included in the current deposit figures

are demand deposits of individuals, partnerships, and corporations of $45,134,000,000,
which decreased $2,945,000,000, or

6

percent, since December, and time deposits of

individuals, partnerships, and corporations of $18,767*000,000, which increased
$3,000,000.

Deposits of the United States Government of $1,526,000,000 were

$627,000,000 more than in December.

Deposits of States and political subdivisions

of $ 4 ,907,000,000 showed an increase of $181,000,000, while deposits of hanks
totaling $7,035,000,000 were $1,377*000,000, or 16 percent, less than in December.

Postal savings deposits were $2,303,000, and certified and cashiers* checks were

$1 ,095 *000 ,000 .
Loans and discounts on April 12 were $21,816,000,000, an increase of # 336.000,0001
or 1§ percent, since December, and an increase of $3,000,000,000, or l 6 percent, s i H
June of last year.
The banks held obligations of the United States Government of $ 37 ,000 ,000 ,000,
which was a decrease of $1 ,870 ,000 ,000 , or nearly 5 percent, since December, and a

TREASURY DEPARTMENT
WASHINGTON, D .C

Information Service

TC - 4

T H E

T R. E A 5 U R Y

C A L E N D A R

Sch e d u l e d D e p a r t m e n t a l A c t i v i t i e s
W E E K OF M A Y 24 - 29,

OFFICE OF THE SECRETARY
Wednesday, May 26« 3 P.M. The Secretary
will assist President Truman in receiving
disabled veterans ^who attend White House
garden party.
Thursday. May 27, 5:30 P.M, The Secretary
will be present at a party honoring
William T. Sherwood, retiring Assistant
Commissioner of Internal Revenue, to be
held at the Sulgrave Club, Under Secre­
tary of the Treasury Wiggins, George J.
Schoeneman, Commissioner of Internal Rev­
enue and other officials will also be
present.
Friday. May 23, II A.M. The Secretary
will attend a ceremony at the White House
in regard ter the issuance of a postage
stamp commemorating the heroism of the
four chaplains who gave up their lives in
the sinking of the Dorchester.

1948

Thursday, 11ay 27, 12 Noon. The Under
Secretary will attend a luncheon given by
the Chatterbox Club, honoring Alvin W.
Hall, Director of the Bureau of Engraving
and Printing.

OFFICE OF THE ASSISTANT SECRETARY
Friday, May 23. Edward H. Foley, Jr.,
Assistant Secretary, will speak at a sav­
ings bond rally at Birmingham, Alabama.
Subject: "The Security Loan.M

OFFICE OF THE FISCAL ASSISTANT SECRETARY
?ifednesday, May 26. Edward F. Bartelt,
Fiscal Assistant Secretary, will speak at
a dinner meeting of bankers, industrial­
ists, retailers and county chairmen of
the Sayings Bonds Division at Worcester,
Massachusetts. Subject: "The Why of the
Security Loan .n

OFFICE OF THE UNDER SECRETARY
OFFICE OF THE GENERAL COUNSEL
Wednesday. May 26. 3 to 6 P.M. Under Sec­
retary Wiggins will participate in a
forum discussion before the National In­
dustrial Conference Board, Waldorf-Astoria
Hotel, New York City,

Wednesday, May 26. Elting Arnold, Assistant General. Gounsel, will speak before
the Bankers Association for Foreign Trade,
Seigniory Club, Montebello, Quebec, Can­
ada, Subject: "Termination of Foreign
Funds Controls."

CONTROLLER OF Tig CURRENCf

BUREAU J2F FEDERAL SUPPLY

Wednesday, fey 26, Deputy Comptroller
C. B. Upham leaves to attend the meeting
of the Bankers Association for Foreign
Trade to he held at the Seigniory Club,
Montebello, Quebec, from May 25 to 28.

Monday. May 24. 10:30 A.M. John J. Kirby
appeared before Sub-Committee No* 4 of
the House Committee on Judiciary on
HR 4659, a bill to ratify amendments to
certain oil contracts*

DIVISION OF SAVINGS BONDS

UNITED STATES COAST GUARD

Friday. May 28. 10 A.M. Leon J. Markham,
National Director of Sales, will be the
guest of the Minneapolis Club, Minneap­
olis, Minnesota, where he will talk to a
large group of food company presidents re
garding the payroll savings plan.

Monday and Tuesday. May 24 and 25. Coast
Guard Reserve Policy Board met at Coast
Guard headquarters in Washington. The
board is composed of Captain C. A.
Anderson, USCG; Captain Lawrence J.
Bernard, USCGR; Captain Merle A. Gulick,
USCGR; Commander Oscar C. B. Wez, USCG;
Lt. Commander Carlton Skinner,. USCGR;
Lt. Commander Marvin J. Coles, USCGR;
Lt. Wolcott W. Robinson, USCGR.

W E E K OF M A Y 31 - J UNE 5,

OFFICE OF Tig SECRETARY
Friday. June 4. 2:30 P.M. Secretary
Snyder will deliver the commencement ad­
dress at the U. S. Coast Guard Academy,
New London, Connecticut.

1948

is required by law. The audit this year
is being made by representatives from th
United States, Mexico and South Africa/
Mr. Cake, the United States representa­
tive, is Chairman of the Audit Committee
The work is expected to be completed
around June 10.

Other Scheduled Speeches
COMPTROLLER OF THE CURRENCY
September 22. Speech before the an­
nual meeting of the National Associa­
tion of Supervisors of State Banks,
Louisville, Kentucky.

Friday and Saturday. June 4 and 5. Deput
Comptroller G. B, Upham will attend the
annual meeting of the New Hampshire
Bankers Association at Portsmouth, N. H.

BUREAU OF INTERNAL REVENUE
Associate Commissioner of Accounts Gilbert
L. Cake at the International Monetary Fund Friday. June 4. E. A. Sellers, Chief of
making the annual audit of the Fund which Actuarial Section, Pension Trust Divisic

BUREAU OF INTERNAL REVENUE
(Continued)
will conduct informal discussions on
"Pension Plans for Employees of Life In­
surance^ Companies w at a meeting of the
Middle Atlantic Actuarial Club in
Baltimore.

NOTE:

BUREAU OF FEDERAL SUPPLY
Tuesday, June 1, 2i30 P.M. Director
Clifton E. Mack will speak before bank­
ing, insurance and general office buyers
of the National Association of Purchasing
Agents, Waldorf-Astoria Hotel, New York
City. Subject; "The Use of Forms in
the Supply Operation."

Items for the Treasury Calendar may be phoned to the Information

Service over extensions 2041, 2042, 2043; internal Revenue extensions
650, 651; Coast Guard, Treasury extension 2993*

TREASURY DEPARTMENT
Information Service
RELEASE MORNING NEWSPAPERS
Thursday« May 27. 194-8

WASHINGTON, D .C.

No« S-745

The total assets of National banks on April 12 of this year amounted to
$85,000,000,000, it was announced today by Comptroller of the. Currency
Preston Delano© The returns from the call covered the 5,014- active banks in
the United States and possessions© The assets were $3,500,000,000, or nearly
4. percent, less than reported by the 5,011 active banks as of December 31, 1947
the date of the previous call, but were $1,500,000,000, or nearly 2 percent,
above the amount reported ty the 5,018 active banks as of June 30, 1947 o
The deposits of national banks on April 12, 1943 were nearly ,
$78,500,000,000, which was a decrease of $3,300,000,000 since December, bub
an increase of more than $1,000,000,000 since June of last year0 Included in
the current deposit figures are demand deposits of individuals, partnerships,
and corporations of $45,134,000,000, which decreased $2,945,000,000, or 6 per­
cent, since December, and time deposits of individuals, partnerships, and
corporations of $18,767,000,000, Yzhich increased $3,0Q0,000o Deposits of the
United States Government of $1,526,000,000 were $627,000,000 more than in
December© Deposits of States and political subdivisions of $4,907,000,000
showed an increase of $181,000,000, while deposits of banks totaling
$7,035,000,000 were $1,377,000,000, or 16 percent, less than in December©
postal savings deposits Y/ere $2,803,000, and certified and cashiers1 checks
were $1,095,000,000©
Loans and discounts on April 12 vrere $21,816,000,000, an increase of
$336,000,000, or 1-| percent, since December, and an increase of $3,000,000,000,
or lo percent, since June of last year0
The banks held obligations of the United States Government of
$37,000,000,000, which was a decrease of $1,870,000,000, or nearly 5 percent,
since December, and a decrease of $2,500,000,000, or 6 percent, since June0
Obligations of States and political subdivisions held in April amounted to
$3,173,000,000, an increase of $144,000,000 over the December figure, and
other securities held were $2,120,000,000, a decrease of $36,000,000o
Cash of $1,087,000,000, balances with other banks (including cash items
in process of collection) of $7,774,000,000, and reserves Ydth Federal Reserve
banks of $11,062,000,000, a total of nearly $20,000,000,000, decreased more
than $2,000,000,000 since December 31o
The unimpaired capital stock of the banks on April 12, 1943 was
$1,800,000,000, including $25,000,000 of preferred stock© Surplus was
$2,420,000,000, undivided profits $962,000,000, and reserves $357,000,000.
Total capital accounts of $5,539,000,000 were ^117,000,000, or 2 percent,
more than in December last©
United States Government securities were 43o51 percent of total assets
on April 12, and loans and discounts we ye 25©69 percent© The percentage of
capital accounts to total deposits was 7©06 percent©

2

-

Statement showing comparison of principal items of assets and liabilities of active national hanks
as of April 12, 1948, December 31* 1947, and June 30, 1947
(in thousands of dollars)
».
♦
.•
*
; Apr. 12,
:
. 1948
;
»
♦
»
•
tz ml*

Dec. 31»
1947
p:

!
:
n n

Increase or decrease¡Increase or decrease
since Dec. 31, 1947 ¡since June 30, 1947
Anmint
¡Percent: Amount
¡percent

June 30,

1947
p: m

sf

7

.nh

-4

-.08

ASSETS
Loans, and discounts, including

overdrafts....,...»,......

$21,816,3^-1

U . S. Government obligations,
direct and guaranteed....... 36,955,647
Obligations of States and polit­
ical subdivisions.*,..... . .
3*172,597
Other bonds,notes,and debentures 1,962,559
Corporate stocks, including

$21,480,457
38*825,435

3*028,607
2*000,094

$335,884

1 .5 6 $3 ,006,335

15-98

39*^25*605 -1,869,788

-4.82 -2,469,958

-6.26

$18,810,006

2 ,900,981

1^3,990

4*75

1 *896,733

-37,535

- 1.8 8

2 7 1,6 16

9.36

65,826

3. *+7

4.« V J

JL# T A

~ ® r ,3 7 8 T 6 5 7 - l . 7 6 l . o 2 7
6 3 , 18§',T63~- 1 ,4 2 5 ,7 4 3

1 ,0 8 7 ,3 2 2

44,009,966
65,4907423
1 ,1 6 8 ,0 4 2

-8 0 ,7 2 0

- 6 .9 1

9 9 .034

~ 3 4 .s o
1 .3 9
10 .0 2

1 1 ,0 6 2 ,3 6 0
7 ,7 7 3 ,7 3 9

1 1 ,6 9 4 ,9 3 5
9 ,2 12 ,6 13

10 ,6 2 3 ,7 2 6
-6 3 2 ,5 7 5
7 ,7 8 3 ,5 3 4 - 1 ,4 3 8 ,8 7 4

-5.4 i

- 15 .6 2

4 38 ,6 34
-9*795

4 .13
- .13

1 9 ,9 2 3 ,4 2 1

2 2 ,0 7 5 ,5 9 0

19 .3 9 5 .5 4 8 - 2 , 1 5 2 , 1 6 9

9 39 ,79 7

880,987

* 8 4 ,9 2 7,8 9 8

8 8 ,4 4 7,0 0 0

1*2,24 8 ,339
1 64,064768b
Currency and coin............
Reserve with Federal Reserve

988,288

-7 7 œ - 2 , 1 3 0 , 3 1 8
0-2.18
8 7 6 ,0 17

Total cash, balances with

.

terns
.

Other assets.

5 2 7 ,8 7 3

2 .7 2

5 8 ,8 10

- 9 .7 5
6* 68

11 0 ,7 4 8

1 3 .3 6

8 3 ,4 13 ,2 6 0 - 3 , 5 1 9 . 1 0 2

-3 - 98

1,5 14 ,6 3 s

1 .8 2

829,049

3
Comparison of principal items of assets and ID abilities of n ational banks - continued
(in thousands of dollars)
Ï
!Increase or decrease; Increase or decreasè
Dec.
3
1
,
:
June
3
0
»
isince Dec* 31 , 19 4 7 :since June 30, 1947
9 Apr. 12, :
¡percent
1948
:
¡Percent: Amount
l
19 4 7
: Amount
19 4 7
:
LIABILITIES
Deposits of individuals, partner­
ships and corporations:
*86
-6 .1 3
844,751» 0 10 -$ 2 ,9 4 5 ,0 7 3
$3 3 3 , 1 2 7
848,079,210
Demand.
2 10 ,6 19
1.14
3,208 . .02
1 8 ,5 5 6 ,6 0 6
1 8 ,7 6 4 ,0 1 7
Time...................... ..
18,767,235
6 9 .6 6
6 2 6 ,6 3 5
6 5 8 ,17 1
868,049
75.82
1,526,220
Deposits of U. S. Government.*...
899,535
-1
-.04
2,804
2,841
-1.3 4
2,803
-38
Postal savings deposits...... .
Deposits of States and political
subdivisions.......... .........
Deposits of banks*............ .
Other deposits (certified and
cashiers* checks# etc.)......*.
Total deposits.......... .
Bills payable, rediscounts and
other liabilities for borrowed
money........ ....... ...........
Other liabilities............ .
Total liabilities» excluding
eaoital account s#
CAPITAL ACCOUNTS
Capital stock:
preferred#..... .......... .
Common stock.............. .
Total
Undivided profits................

'
4 ,907,268
7,034,621

4 ,7 2 6 , 3 3 3
S,4ll,473

1 ,0 9 4 ,7 7 2
76,^67,2^6

82 ,275 ,356 ”

344,552
-399,142

7 .5 5
-5 .3 7

1,222,001
-297,125
77,3977149" -3,808,110

“ 21.35
-4.63

-1 2 7 , 2 2 9
1 ,0 7 0 ,0 9 7

-I0.4i
1*38

4 5 ,13 5
705,185

27,860
679,571

107,180
64,484

2 3 7 .4 7
9.14

124,455
90,098

446.72

79,389,230

63,025,676

78,104,580

- 3 ,6 3 6 ,4 4 6

-4.38

1,284,650

1.64

25,235
1,774,713

27 »44o

1 ,752,326

23,359
1,742,512
1,770,871
2,329,951

-2,205
22,387

-8.04
1.28
I. 1 3

374 ,79s

68,558

.8 3
7.68

333»o6o

8,642

2.48

-3,124
3 2 ,2 0 1
29,077
S9»53i
86,992
24,388

3,641,553
5,421,32^

3,537,309
5,3087660

9 7 ,1 6 2
117 ,3 4 4

88,447»000
Percent
4 3 .9 0
24.29
6.59

63,413,260
Percent
4 7 .2 7
2 2 .5 5
6 ,8 0

- 3 ,5 1 9 , 1 0 2

1 ,799 ,94s
2,419*482
9bl?790

.Total surplus, profits, and
3,736*720
reserves. ........... .
5,53S,W
Total capital accounts......
Total liabilities and cap64,927,696
ital accounts*
Ratios:
Percent
U.S* Gov*t securities to total assets 43*51
Loans and discounts to total assets
25*69
Capital accounts to total deposits
7*06
Minus sign denotes decrease#

3-S3
-16 .3 7

180,935

769,669

152,315

357,448

NOTE:

1 ,3 9 1 , 3 9 7

- 1 ,376,652

4,562,716
7 ,4 3 3 .9 6 3

1,779,766
2,399,520
893.232
348,806

2 0 ,18 2
19,962

2 .6 7
2 .16 “
-3.98

13 .2 6

-11.0 2

1.8 5
1 .6Γ
3 .8*r
9.94
7 .3 2

200,911

5 .6s

229,988

4 .3 3

1 ,5 14 ,6 3 s

1 .8 2