﻿THE MONEY MARKET

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or were to be used for carrying certificates or bonds.
Beyond this a general assurance was given savings
banks and trust companies that “ the Board desired
in every way to cooperate with them in avoiding
stringency and that the Federal Reserve banks were
prepared to extend through member banks every
reasonable accommodation not inconsistent with law
for the purpose of relieving any strain which might
result from withdrawals of deposits for purchases
of government deposits.” 31

This policy of preparedness involved important
changes in discount schedules and rates, as fol-
lows : 32

1.	The establishment of a rate of three per cent, per
annum for the discount at Federal Reserve Banks of notes
of member banks running not longer than 15 days secured
by Treasury certificates of indebtedness.

2.	The establishment of a rate of discount at Federal
Reserve banks of three and one-half per cent, per annum
for customers’ notes running up to 90 days, secured by
Government obligations and indorsed by member banks,
when such notes had been made for the purpose of obtain-
ing funds for the purchase of Government obligations.

3.	The authorization of Federal Reserve banks to dis-
count for member banks, on behalf of non-member banks,
notes of non-member banks or their customers, secured by
Government obligations, for the purpose of obtaining
funds with which to purchase United States bonds or
notes.

4.	The establishment of a one-day rate of from two
to four per cent, at New York for the purpose, of restoring
to the market, funds temporarily withdrawn through Gov-
ernment loan operations.

31	Federal Reserve Bulletin, June, 1917, PP- 425-6-

32	“ Fourth Annual Report of Federal Reserve Board,” pp.
5-6.