Board of Governors of the Federal Reserve System (U.S.) - Buildings

Franklin D. Roosevelt

English

Research Papers in Economics

Address by
The President of the United States
at the official opening of the
Federal Reserve Building
October 20, 1937
Mr. Chairman, Members of the Board and of the Staff, Ladies and Gentlemen:
You have come here this afternoon for something more than a mere formality. This
structure is worthy to rank among the foremost of the Capital's architectural achievements,
and you and I have gathered here to pay tribute to the beauty and dignity of line and form
wrought by those who conceived and executed this building.
But we are conscious of a larger meaning in this brief ceremony—of the role that the
Federal Reserve plays in the broad purpose which this Government must serve. That pur-
pose is to gain for all of our people the greatest attainable measure of economic well-being,
the largest degree of economic security and stability.
To advance the country towards this goal is the real mission of the Federal Reserve
System. It cannot be attained by that System alone, but neither can it be reached without
the proper functioning of our monetary and credit machinery. That machinery must be
steadily perfected and coordinated with all other instruments of Government to promote
the most productive utilization of our human and material resources. Only in that way
can we hope to achieve and maintain an enduring prosperity, free from the disastrous
extremes of booms and depressions. Only in that way can our economic system and our
democratic institutions endure.
Nearly a quarter of a century has passed since the Federal Reserve System was estab-
lished. Its creation, out of the Nation's banking experience from the beginning of the
Republic, was due to the statesmanship of President Wilson, and to the courageous leader-
ship in the Congress for which the Senior Senator from Virginia, Carter Glass, will always
deserve the Nation's gratitude.
It is fitting that President Wilson's portrait in bronze should have the place of honor
in the main entrance to this building. And it is appropriate that the words inscribed under
it should be taken from his first inaugural address. Let me quote them:
"We shall deal with our economic system as it is and as it may be modified, not as it
might be if we had a clean sheet of paper to write upon; and step by step we shall make it
what it should be."
Those penetrating words admirably apply to our banking system, which must be con-
stantly alert to changing conditions in order that it may be prepared to adapt itself to the
growing and changing needs of our people in their daily life and work.
The Federal Reserve System, as it was originally established, was adapted to the pre-
war world and brought about a great improvement in the money system. Steps were taken
in 1917 to adapt it to the urgent necessities of a war-ridden world. In mobilizing the
country's gold reserves and in facilitating the Government's vast financing operations, the
Reserve System performed a vital role in the winning of the war.
1061
Federal Reserve Bulletin: November 19371062 FEDERAL RESERVE BULLETIN NOVEMBER 1937
It is clear now, in retrospect, that if further changes to meet post-war conditions had
been made in our banking system in the 1920's, it would have been in a far better position
to moderate the forces that brought about the great depression. But from the end of the
war until we were in the midst of economic collapse a decade later, no changes were made
in the banking structure to make it function more effectively in the public interest.
Since that time the nation has done much to improve its banking system. It must
continue step by step to make the banking system what it should be. We must not com-
placently suppose that we have achieved perfection. We have provided for the insurance
of deposits for the benefit of the great mass of small depositors. By the Banking and
Security Exchange Acts of 1933, 1934 and 1935, the Federal Reserve System was given
increased power to improve banking conditions and to aid the Government in combating
practices which were evil in their results. Those powers have been concentrated to a greater
degree than before in a single public body, so that they can be used promptly and effectively
in accordance with the changing needs of the country. 1937 is not 1913; nor do we want
to turn the hands of the clock back.
The Federal Reserve System, tested by nearly a quarter of a century of operation,
is a public institution capable of adaptation to future, as it has been to past needs and
conditions. It is a piece of machinery vital to the Nation's steady progress towards the goal
of a sounder banking system capable of contributing its full share to lasting economic
progress and well-being.
The Board of Governors, whose building we are dedicating today, was reconstituted
by the Banking Act of 1935. To this public body Congress has entrusted broad powers
which enable it to affect the volume and the cost of money, thus exerting a powerful influence
upon the expansion and contraction in the flow of money through the channels of agriculture,
trade and industry. In this way much can be done towards the maintenance of more stable
employment. Much can be done to aid in achieving greater stability of the true value of
the dollar.
By their nature these important powers are of public concern and the responsibility
for their exercise is properly vested in a public body. Much as they may contribute to the
country's progress, monetary powers possess no peculiar magic. They are not omnipotent.
To be effective in performing their function, they must be closely coordinated with the other
major powers and policies of government which influence the country's economic life.
The Federal Reserve System as it exists today is better adapted than ever before to
play its part in common with the other instrumentalities of government in the attainment
of that increasing well-being for all of our people, which is the fundamental objective of
all government.
I dedicate this building to progress toward the ideal of an America in which every
worker will be able to provide his family at all times with an ever-rising standard of comfort.
Federal Reserve Bulletin: November 1937

Address by the president of the United States at the official opening of the Federal Reserve building

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Address by the president of the United States at the official opening of the Federal Reserve building

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Research Papers in Economics