May 5, 1964 FOMC Minutes

FOMC minutes

recent years for use in connection with an inquiry by the Domestic Finance Subcommittee of the House Banking and Currency Committee. (A copy of this memorandum has been placed in the files of the Committee.) Mr. Balderston invited Mr. Stone to comment. Mr. Stone said that the study in question would actually be made by Mr. George Benston, a staff member of the Subcommittee and a faculty member at the University of Chicago. His discussions with Mr. Benston had been most amicable and satisfactory, and he saw no problems from the viewpoint of the Desk in complying with the request. References to individual dealers would be deleted from the material supplied to preserve confidentiality. Mr. Stone added that he should mention that the summary tabulations Mr. Benston had requested would be supplied in the form of appendix pages from the Account Management's weekly report to the Committee. These pages contained information not only on transactions in Treasury bills, which was th object of Mr. Benston's interest, but in some cases also on transactions in coupon issues. There were virtually no transactions in coupon issues recorded on the sheets on which bill transactions were recorded during the years for which the data were requested, except for some in 1951 and 1952, Mr. Mitchell commented that he thought it desirable to provide exactly what had been asked for. Mr. Daane concurred in this view,

Mr. Balderston asked whether there was any objection to authorizing Mr. Stone to provide the information requested by the Subcommittee on Domestic Finance to Mr. Benston, and no objection was raised. Secretary's Note: In accordance with this decision, the following letter was sent to Chairman Patman over the signature of Chairman Martin later in the day: This is in reply to your letter of April 6, 1964, requesting certain information relating to Federal Reserve open market transactions in recent years for use in con nection with an inquiry by the Domestic Finance Subcommittee into the operations of the Government securities market. The Federal Open Market Committee considered your request at its meeting today, and is glad to cooperate in providing the information required for this inquiry. As you may know, Mr. Benston of your staff and Mr. Stone, Manager of the System Open Market Account, have engaged in personal discussions and correspondence in order to arrive at more complete specifications of the materials required and the manner in which they are to be used. Mr. Stone will communicate shortly with Mr. Benston con cerning arrangements for physical transmission of the materials in question. Mr. Ba derston noted that a menorandum from Messrs. Sherman and Young had been distributed under date of May 1, 1964, regarding for making historical minute records of Open Market the procedure for scholarly research, and he asked policy discuss:ons available Mr. Young to comment. the contents of the memorandum, a copy Mr. Young summarized has been placed in the files of the Committee. He noted that of which Archives would be prepared to receive the Open Market the National

Committee minute records for the period prior to 1961 and to make copies of the material available to scholars and others on a reimbursable cost basis. The Committee earlier had discussed making its records available for the period 1950-60, but it seemed logical that the Com mittee's entire minute record through 1960, and those of predecessor groups in the System, be made available at the same time, and he and Mr. Sherman so recommended. No restrictions would be imposed on the use of these records other than those customary for appropriate preservation by the National Archives. The main interest probably would be on the part of scholars, although journal:_sts and others might also consult the records. Mr. Young said the Secretariat had been in touch with the various learned societies, including the American Economic Association, Association, and the American Historical the Economic History Association. All had expressed willingness to cooperate in promoting on these records, The Secretariat also had been in research based touch wit': the Social Science Research Council. The Council was pre pared to set up a committee to suggest types of useful reserach and interest on the part of younger scholars, to elicit Upon motion duly made and seconded, and by vote, the procedures outlined in the unanimous Sherman and Young were memorandum from Messrs. approved. Mr. Balderston noted that it had been agreed at the preceding session at this meeting devoted to the meeting to hold an afternoon

form and content of the Committee's current economic policy directive. Mr. Ellis observed that he thought such a discussion would be highly desirable. He noted, however, that the staff memorandum on this subject, dated April 8, 1964, did not propose a particular framework for discussior. In his judgment, the discussion would be more fruitful if the Committee had before it an agenda, with specific pro posals. He therefore proposed that the discussion be postponed until a later meeting, by which time such an agenca could be prepared. It was agreed that Messrs. Mitchell, Ellis, and Swan would an outline for a discussion of the Committee's undertake to prepare policy directive at a later meeting. Also, it was current economic than members and other Reserve Bank Presidents forward suggested proposals they would like to advance to one of these individuals. any It was agreed that the next meeting of the Open Market be held on Tuesday, May 26, 1964, at 9:30 a.m. Committee would Thereupon the meeting adjourned. Secretary U