PETER NORBECK, South Dakota, Chairman PHILLIPS LEE GOLDSBOROUGH, Maryland. JOHN G. TOWNSEND, JR., Delaware. The subcommittee met, pursuant to call of the chairman at the room of the Committee on Banking and Currency, Senate Office Building, at 10.30 o'clock a. m., Senator Carter Glass (chairman) presiding. Present: Senators Norbeck, Townsend, Walcott, and Bulkley; also present, Senators Wagner and Brookhart, and H. P. Willis, special counsel of the committee. The CHAIRMAN. The committee will come to order. As a matter for the record, I may state that this subcommittee is proceeding under Senate Resolution 71, which I will hand to the stenographer to be inserted in the record of the proceedings. As will be noted, it gives the committee complete authority to inquire into the banking situation of the country and the committee is authorized and directed to inquire specifically into the administration of the Federal Reserve and National banking systems with respect to the use of their facilities for trading in and carrying speculative securities; the extent of call loans to brokers by member banks for such purposes; the effect on the systems of the formation. of investment and security trusts; the desirability of chain banking; the development of branch banking as a part of the national system, together with any related problems which the committee may think it important to investigate. (The resolution in full is as follows:) RESOLUTION Resolved, That in order to provide for a more effective operation of the national and Federal reserve banking systems of the country the Committee on Banking and Currency of the Senate, or a duly authorized subcommittee thereof, be, and is hereby, empowered and directed to make a complete survey of the systems and a full compilation of the essential facts and to report the result of its findings as soon as practicable, together with such recommendations for legislation as the committee deems advisable. The inquiry thus authorized and directed is to comprehend specifically the administration of these banking systems with respect to the use of their facilities for trading in and carrying speculative securities; the extent of call loans to brokers by member banks for such purposes; the effect on the systems of the formation of investment and security trusts; the desirability of chain banking; the development of branch banking as a part of the national system, together with any related problems which the committee may think it important to investigate. 1 |