CHAPTER  V

Investment  of  Postal  Savings  Funds
The  most  difficult  problem,  it  has  been  said,
which  Congress  had  in  formulating  its  postal
savings  bank  plan  in  1910  was  that  of  the  investment ­
  of  the  deposited  funds.  This  problem,  we
have  seen, 1  was  solved  by  dividing  the  funds  into
three  parts  :  (  1  )  A  5  per  cent  reserve  fund  to  be
kept  in  lawful  money  in  the  Treasury  of  the
United  States; 2  (2)  a  sum  not  exceeding  30  per
cent  of  the  amount  of  postal  savings  funds,
which  “may  at  any  time  be  withdrawn  by  the
1  Supra,  pp.  43-44.
2  The  5  per  cent  reserve  held  in  the  United  States  Treasury ­
  at  Washington  is  adjusted  only  once  a  year,  and,  inasmuch ­
  as  there  has  been  an  increase  of  deposits  during  each
year,  the  percentage  of  reserve  as  adjusted  declines
throughout  the  year.  With  deposits  growing  as  rapidly  as
those  of  the  postal  savings  system,  such  a  long  interval  between ­
  the  dates  of  the  adjustments  of  the  reserve  results  in
the  maintenance  of  a  reserve  which  averages  far  below  5
per  cent.  Probably  a  5  per  cent  requirement  is  unnecessarily ­
  high  under  the  circumstances.  If  so,  it  should  be  reduced ­
  by  law.  To  make  the  percentage  of  the  reserve  vary
inversely  throughout  the  year,  as  at  present,  with  the  amount
of  postal  savings  deposits  seems  to  be  a  questionable  policy.
Cf.  Ann.  Rep.  3  Assist.  Postmast.-Gen.,  1913,  p.  37.