132

WAR  BORROWING

Although  the  foregoing  facilities  were  extended
only  to  banks  subscribing  for  $100,000  or  more,  the
Treasury  regarded  it  as  “entirely  admissible  for
banks  and  trust  companies  in  any  region  or  regions,
by  voluntary  association  among  themselves  to  pool
their  subscriptions  and  payments  ”  and  to  designate
one  of  their  number  through  which  subscriptions
should  be  made,  and  which  should  be,  as  between  itself ­
  and  the  United  States,  regarded  as  the  responsible ­
  subscriber  and  depositary.  The  Treasury  restated ­
  its  intention  to  in  any  event  deposit  funds
with  banks  subscribing  less  than  $100,000  as  soon
after  July  2  as  practicable,  “  as  nearly  as  may  be
in  proportion  to  the  payments  of  each  in  cash  and
certificates  of  indebtedness  upon  subscriptions  to
the  Liberty  Loan.”  Under  this  authority,  1251
national  and  780  state  banks  and  trust  companies
made  application  and  were  designated  as  depositaries ­
  of  public  moneys,  becoming  thereby  qualified
to  make  payment  by  credit  for  bonds  of  the  First
Liberty  Loan  and  to  receive  cash  deposits  of  funds
realized  from  the  sale  of  bonds. 21
Certificate  borrowing  was  resumed  in  anticipation
of  the  Second  Liberty  Loan  without  change  in  mode
of  payment  or  manner  of  deposit,  other  than  that
the  number  of  special  depositaries  was  further  increased ­
  by  83  national  and  72  state  banks  and  trust
companies  which  subscribed  for  the  certificates  of
August  9,  1917.  But  with  the  next  succeeding  issue
(August  28,  1917)  payment  by  credit  was  generally
extended,  as  we  have  seen,  by  administrative  tolerance ­
  to  certificate  borrowing  and  this  device  con-81
  “  Report  of  the  Secretary  of  the  Treasury,  1917,”  p.  25.