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Conversation 006-172

TapeTape 6StartWednesday, July 21, 1971 at 2:39 PMEndWednesday, July 21, 1971 at 2:42 PMTape start time04:02:46Tape end time04:05:35ParticipantsNixon, Richard M. (President);  Connally, John B.Recording deviceWhite House Telephone
AudioNARA Description

On July 21, 1971, President Richard M. Nixon and John B. Connally talked on the telephone from 2:39 pm to 2:42 pm. The White House Telephone taping system captured this recording, which is known as Conversation 006-172 of the White House Tapes.

Nixon Library Finding Aid
Conversation No. 6-172

Date: July 21, 1971
Time: 2:39 pm - 2:42 pm
Location: White House Telephone

John B. Connally talked with the President.

[See Conversation No. 264-11]

     Refinancing of national debt
          -Ten-year bonds
               -Interest rates
          -Wright Patman, Henry S. Reuss
               -Possible criticism

          -Interest effect on rates

     Connally’s upcoming meeting with the President
Transcript (AI-Generated)

This transcript was generated automatically by AI and has not been reviewed for accuracy. Do not cite this transcript as authoritative. Consult the Finding Aid above for verified information.

Hello.
Mr. President, I have Secretary Conley calling you.
Yeah.
All right, thank you.
Hello.
Yes, hi.
We have to do a refinancing, which is normal in its scope.
I wrote you a note about it yesterday, the day before, of about $5 billion.
This is just normally a routine thing, but today we think we're going to announce that we're going to use the authority which Congress gave us earlier this year to issue...
some bonds in the 10-year time frame, 10-year bonds.
This will be the first time we've used the authority to issue bonds longer than seven years at more than the 4.25% interest rate.
We'll put them out at 7%.
And then we're going to have to discount them a bit to make them marketable.
But I wanted just to tell you about it.
I don't think we've talked about it.
We've met with all our investment bankers committee.
We've met with the American Bankers Committee.
But I sure didn't want to do it without you just knowing about it.
I think it's fine.
I think it's all right.
I'm going to be criticized by Patman and Royce.
for issuing these 10-year bonds at this rate of interest, but hell, this is what the rate of interest is, and we got to finance this debt.
Yeah, yeah.
But I just wanted to know.
Well, there's nothing, you mean it's the only way you can really get the money, I guess.
Oh, yeah, oh, yes.
Now, we don't have to issue the 10-year bonds, but we're issuing only probably half a billion of 10 years.
We think that's all that will be taken up.
Does it have an effect on interest rates generally?
Well, no, we don't think so, and we've been arguing about that for two hours.
And the reason we're doing it the way we are is because we don't think it'll affect.
As a matter of fact, we think it might have.
They all argue that it'll have a salutary effect on long-term rates.
I don't think so, but all the financial experts think it will.
I don't.
But I don't think it'll hurt it.
Right.
We don't have to issue it, but out of the $5 billion, see, we again are crowding too much of our debt in too short a period of time.
I see.
We've got to get some of this debt over a longer span of time.
This is why we fought so for the authority.
Right.
But even so, we won't put out but probably half a billion out of the $5 billion refinancing.
Sure.
It won't be but 10% of it that will go in the long-term 10-year time frame.
But I don't think there's any problem with it at all.
I'll take some flack because of it, but I want you to know it because we're using this authority for the first time.
Sure.
Well, you've looked it over, and if that's the thing to do, that's what we'll do.
Fine.
All right, sir.
And I'll see you at 3 anyway.
3 o'clock.
Right.
Right.
Okay.
Thank you.
Good.
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