William McChesney Martin

The Chairman of the Board of Governors at the time of ratification was Thomas B. McCabe (1893–1982), who would officially resign from his position just six days after the statement of the Accord was released.

The Truman Administration saw the resignation of McCabe as the perfect opportunity to regain control of the Fed almost immediately after it had supposedly become independent.

William McChesney Martin Jr. (December 17, 1906 – July 27, 1998) was an American business executive who served as the 9th chairman of the Federal Reserve from 1951 to 1970, making him the longest holder of that position.

He was nominated to the post by President Harry S. Truman and reappointed by four of his successors.

Martin, who once considered becoming a Presbyterian minister, was described by a Washington journalist as "the happy Puritan".

William McChesney Martin Jr. was born in St. Louis to William McChesney Martin Sr. and Rebecca Woods.

Martin's connection to the Federal Reserve was forged through his family heritage.

In 1913, Martin's father was summoned by President Woodrow Wilson and Senator Carter Glass to help write the Federal Reserve Act that would establish the Federal Reserve System on December 23 of that year.

His father later served as a governor and then president of the Federal Reserve Bank of St. Louis.

Martin graduated from Yale University, where his formal education was in English and Latin rather than finance.

However, he still maintained an intense interest in business through his father.

His first job after graduation was at the St. Louis brokerage firm of A. G. Edwards & Sons, where he became a full partner after only two years.

From there, Martin's rapid rise in the financial world landed him in 1931 a seat on the New York Stock Exchange (NYSE), just two years after the Wall Street Crash of 1929 at the outset of the Great Depression.

Martin pursued graduate study in Economics at Columbia University from 1931 to 1937; however, he did not receive a degree.

During the early part of that decade, Martin's work towards increasing regulation of the stock market led to his election to the NYSE's board of governors in 1935.

There, he worked with the U.S. Securities and Exchange Commission (SEC) to reestablish confidence in the stock market and prevent future crashes.

He eventually became president of the New York Stock Exchange at age 31, leading newspapers to label him the "Boy Wonder of Wall Street."

Like his tenure as governor on the exchange, Martin's presidency focused on cooperating with the SEC to increase regulation of the exchange.

During World War II he was drafted into the United States Army as a private and rose to the rank of colonel.

While in the service, he supervised the disposal of raw materials on the Munitions Allocation Board.

He was also a liaison between the Army and Congress, as well as the supervisor of the lend-lease program with the Soviet Union.

Martin's return to civilian life was also a return to the financial world, but this time it was in the Federal government.

Harry S. Truman, a fellow Democrat, appointed Martin director of the Export-Import Bank, which he operated for three years (1946-1949).

It was at this institution that he was publicly viewed as a "hard banker."

He insisted that loans be sound, secure investments; on that principle he opposed the State Department on multiple occasions for making loans that he saw as being politically motivated.

On those grounds he would not permit the Export-Import Bank to be used as a fund for international relief.

Martin left the Export-Import bank when he was summoned to the Treasury to serve as assistant secretary for monetary affairs.

Martin served at the Treasury for about two years when its conflict with the Federal Reserve Board reached its climax.

During the period immediately preceding the final negotiations with the Fed, Secretary of the Treasury John W. Snyder was hospitalized.

In this situation, Martin became the chief negotiator for the Treasury.

From the Treasury's perspective, Martin was a valuable representative, for he had a thorough understanding of the Federal Reserve System and of financial markets.

Furthermore, he was viewed as an ally of Truman, who strongly opposed the Fed's independence.

During negotiations, Martin re-established communication between the Treasury and Fed, which had been forbidden by Snyder.

With Robert Rouse, Woodlief Thomas, and Winfield Riefler of the Fed, Martin negotiated the 1951 Accord.

The Federal Open Market Committee (FOMC) and Secretary Snyder accepted the Accord, and it was approved by both institutions.

Truman appointed Martin to serve as the next Chairman of the Board of Governors, and the Senate approved his appointment on March 21, 1951.

Contrary to Truman's expectations, however, Martin guarded the Fed's independence, not just through Truman's administration but also through the four succeeding administrations.

To the present day, his term as chairman is the longest term in the history of the Fed.

For nearly two decades, Martin would achieve global recognition as the world's most important central banker.

He was able to pursue independent monetary policies while still paying heed to the desires of various presidential administrations.