THE  PRESENT

45

must  be  had  to  some  more  productive  source.  This
took  the  form  of  certificate  borrowing  in  anticipation ­
  of  a  Third  Liberty  Loan,  then  definitely  contemplated ­
  but  not  yet  formally  authorized  nor  even
specifically  determined.  On  January  17,  1918,  the
Treasury  offered  the  first  issue  of  certificates  of
this  kind,  to  the  amount  of  $400,000,000,  dated
January  22,  1918,  payable  April  22,  1918  and  bearing ­
  four  per  cent,  interest.
Three  weeks  later,  the  Treasury  announced  a
comprehensive  plan  for  short-term  borrowing  in
anticipation  of  the  Third  Liberty  Loan  —  the  actual ­
  flotation  of  which  it  was  desired  to  postpone
“  until  conditions  will  insure  a  wide  distribution  of
the  bonds  throughout  the  country.”  22  Instead  of
issues  of  certificates  of  indebtedness  at  irregular  intervals ­
  and  of  unequal  amounts,  it  was  proposed
to  offer  at  fortnightly  intervals  beginning  February
8,  1918,  six  series  of  $500,000,000  each  of  not
more  than  ninety  days  maturity.  As  theretofore,
the  certificates  were  to  be  distributed  by  the  Federal ­
  Reserve  Banks  and  to  be  absorbed  by  the  banks
of  the  country  —  national,  state  and  trust  companies ­
  ;  non-member  as  well  as  member  —  as  shortterm ­
  investments  in  their  own  behalf  and  for  their
customers.  Moreover  instead  of  relying  on  voluntary ­
  optional  response,  the  Treasury  urged  uniform ­
  proportionate  contribution  from  every  national ­
  bank,  state  bank  and  trust  company,  in  the
form  of  one  per  cent,  of  its  gross  resources  to  be
set  aside  weekly  for  investment  in  the  certificates.
22  Text  of  announcement  in  Federal  Reserve  Bulletin,
March,  1918,  p.  161.