﻿8o

WAR BORROWING

among the certificates tendered in payment of the
first installment was the entire issue maturing June
30, 1917, there would have remained outstanding
some $300,000,000 certificates retained by the banks
or their customers as investments instead of being
tendered in payment of bond subscriptions. To
this extent the over-payment resulted in swelling
the Treasury balance at the expense of leaving a cor-
responding amount of the certificates of indebted-
ness unliquidated. The significance of payment by
credit, as distinct from cash or certificate payment,
has to do with the general question of credit ex-
pansion consequent upon the certificate issues and
will be examined in another connection.3

The fiscal results of the Loan flotation appeared
in an abrupt increase of the Treasury balance from
$299,830,457 on June 29 to $1,064,086,250 on June
30. Of this latter amount $305,743,526 was in the
form of government deposits with the Federal
Reserve Banks, and $714,841,218 with member
banks qualified as special depositaries — this in turn
being distinguished as $560,662,218 on account of
Loan proceeds and $154,179,000 on account of cer-
tificates. Moreover the flotation had made possible
by redemption at maturity and by acceptance in pay-
ment of the Loan installment the discharge of $626,-
196,844 certificates of indebtedness, reducing the
amount then outstanding to some $260,000,000.

The issue of the “ daily statement ” of the Treas-
ury was suspended on June 29, 1917, and not again
renewed until July 23, 1917, on which date the
statement for June 30, 1917, was first made public.

3	Page 129, below.