Word: rediscounted
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...Bank of England, in his quiet sanctum, Montagu Collet Norman sat one morning last week, and probably he stroked in anxious meditation his courtly Vandyke beard. Invisibly the battle of gold was on. It was a question whether to call out the ordinary reserves?whether to raise the rediscount rate of the Bank of England...
Such a step would put a heavy strain on British industry. Legitimate and necessary business borrowing within Great Britain would be regrettably curtailed by so high a rate. When the news flashed from Manhattan that the U. S. Federal Reserve Bank had unexpectedly boosted its rediscount rate a full percent, to 6%, it was clear that something must be said or done...
Speculators chewed ragged cigars last week, conferred past midnight, lost their sleep. Thursday's stock market had closed strong when the Bank of England did not raise its rediscount rate. Then, late in the afternoon, came announcement that the Federal Reserve Bank of New York had raised its rate from 5% to 6%. Wall Street was caught unprepared. Tycoons rushed to telephones, brokers called up bankers. Ten members of the Stock Exchange were seen leaving a Broad Street building in one nervous, gesticulating group. Long after the dinner hour two Rolls-Royces still waited outside the austere House of Morgan...
...borrow $400,000,000 for nine months, it prepared to pay a higher interest rate- 5⅛% - than at any time in the last eight years. For the first time in an even longer period the Treasury's quarterly financing interest rate was above the Federal Reserve bank rediscount rate (5%). A year ago a similar loan was put out by the U. S. at 3⅞% whereas in 1924 the Government was able to procure money in the public market at 2¾%. The highest "war" rate was 6%. This issue of Treasury certificates, dated June...
Financial observers wondered if the Federal Reserve had not held down its rediscount rate largely to help the Treasury issue these certificates at a lower interest rate than would have been possible if the rediscount rate had been boosted...