Paper REDISCOUNTED AND BouGcHT BY FEDERAL REsErvE Banks 
Notes, drafts, bills of exchange, trade acceptances and six 
months’ agricultural paper eligible for rediscount by 
the Federal Reserve Banks 
Definitions as laid down by the Federal Reserve Board: 
Promissory Note—An unconditional promise, in writing, signed by the maker, to 
pay, in the United States, at a fixed or determinable future time, a sum certain 
in dollars to order or to bearer. 
Draft or Bill of Exchange—An unconditional order, in writing, addressed by one 
person to another, signed by the person giving it, requiring the person 
to whom it is addressed to pay in the United States, at a fixed or determinable 
future time, a sum certain in dollars to the order of a specified person. 
Trade Acceptance—A draft or bill of exchange, drawn by the seller on the pur- 
chaser, of goods sold, and accepted by the purchaser. 
Nine Months’ Agricultural Paper—A note, draft, bill of exchange, or trade 
acceptance, drawn or issued for agricultural purposes, or based on live stock; 
that is, a note, draft, bill of exchange, or trade acceptance, the proceeds of which 
have been used, or are to be used, for agricultural purposes, including the 
breeding, raising, fattening, or marketing of live stock, and which has a maturity 
at the time of discount of not more than nine months, exclusive of days of grace. 
The Federal Reserve Act provides that any Federal Reserve Bank 
May discount for any of its member banks any note, draft, or bill of 
exchange, provided: 
(a) It has a maturity at the time of discount of not more than 90 days, exclusive 
of days of grace; but if drawn or issued for agricultural purposes or based 
on live stock, it may have a maturity at the time of discount of not more than 
nine months, exclusive of days of grace. The Agricultural Credits Act of 
March 4, 1928, provides that any Federal Reserve Bank may discount or 
purchase bills of exchange payable at sight or on demand which are drawn 
to finance the domestic shipment of nonperishable, readily marketable 
staple agricultural products and are secured by bills of lading or other 
shipping documents conveying or securing title to such staples, provided 
that all such bills of exchange shall be forwarded promptly for collection and 
demand for payment shall be made with reasonable promptness after the 
arrival of such staples at their destination: provided further, that no such 
bill shall in any event be held by or for the account of a Federal Reserve 
Bank for a period in excess of 90 days. 
(b) It arose out of actual commercial transactions; that is, it must be a note, 
draft, or bill of exchange which has been issued or drawn for agricultural, 
[ RO ] 
Vo