25

II

THE  PRESENT
In  the  financing  of  the  present  war,  the  United
States  has  made  use  of  negotiable  short-term  debt
obligations,  under  the  designation  of  “  Treasury
certificates  of  indebtedness,”  from  the  preparatory
measures  taken  before  the  actual  declaration  of
hostilities,  through  the  first  anniversary  of  entry
into  the  struggle,  up  to  the  present  time  of  writing
[November  i,  1918].  There  have  been  in  this
period,  thirty-one  issues  of  certificates  offered  by
the  Treasury  through  the  Federal  Reserve  Banks
for  general  subscription  by  banks  and  individuals. 1
In  addition  the  Federal  Reserve  Banks  have  on
various  occasions  made  temporary  loans  to  the
Treasury,  “  to  avoid  constant  withdrawals  of  government ­
  funds  on  deposit  with  depositary  banks,”
by  the  direct  purchase  of  certificates  of  indebtedness
payable  within  a  few  days  and  bearing  interest  at
from  two  to  four  per  cent. 2  In  the  following 3
1  See  below  p.  28  as  to  the  ante-bellum  issue  of  March
3 1 ,  1917,  herein  included.
2  “  Fourth  Annual  Report  of  the  Federal  Reserve  Board  ”
(Washington,  1918),  pp.  265,  277.
3  In  a  note  on  “Certificates  of  Indebtedness  in  our  War
Financing”  in  The  Journal  of  Political  Economy,  November,
1918,  the  present  writer  has  summarized  the  course  of  certificate ­
  borrowing  down  to  June  I,  1918,  in  the  manner  of  the
present  chapter.