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SMITHSONIAN INSTITUTION   1320

the Freer and the Consolidated Funds were in definitely favorable condition. Mr. Richardson is also present with us this morning to discuss our situation as it stands at the present time.

The Secretary, through careful attention to expenditures, has now accumulated a cash surplus of approximately $75,000 to serve as a reserve should there be any unforeseen decrease in return on our capital. The investment from the cash account of the Institution in United States Treasury Certificates of Indebtedness was increased from $500,000 to $600,000, which gives an appreciable amount of income for general use from moneys that otherwise would lie idle in the Treasury.

If it is the will of the Board of Regents, I will be glad to continue to function in my present capacity in taking the responsibility of passing on recommendations regarding our investments made by Scudder, Stevens and Clark, but I would like the Board to know that I am not infallible.

Respectfully submitted,
/s/ Robert V. Fleming,
Chairman, Executive Committee.

Members of the Board of Regents present voted unanimous approval of Dr. Fleming's report and actions as Chairman of the Executive Committee, relative to investment recommendations of Scudder, Stevens and Clark, investment counsel, and authorized fully his continued operation and responsibility in these matters.

In discussion of positions in the newly established top level grades, the Chancellor commented briefly on similar positions elsewhere in the service, stating that effort would be made to increase the limitation governing their number. It was agreed that further action should be taken toward higher classification for certain positions in the Smithsonian, including that of Mr. Graf, whenever the ceiling covering these was increased, or other opportunity permitted.

Mr. D. L. Richardson, representing Scudder, Stevens and Clark, investment counsel for the Institution, outlined the present status of the Institution's portfolio, and explained

A.W.