THE  PRESENT

6  7

installments  of  the  Four  Liberty  Loans  in

the  following

  proportions

First

Second  Third

Fourth

[per  centum]

Part  of  Loan  paid  on  first  installment



73

73

77

86  44

Composition  of  first

installment

  payment:
Certificates

38

17

26

29

Credit

27

53

47

49

Cash

35

30

27

22

A  small  use  of  cash  and  certificates  and

a  heavy

use  of  credit  in  payment  of  bond  subscriptions  have
thus  marked  the  successive  Liberty  Loan  flotations.
As  to  cash,  payments  have  been  made  by  interior
banks  by  drafts  upon  the  reserve  banks,  and  by  the
reserve  banks  by  drafts  upon  their  reserve  balances
with  Federal  Reserve  Banks  —  this  resulting  in  turn
in  a  heavy  demand  for  discounts  from  memberbanks
  and  through  them  from  non-member  banks,
for  the  restoration  of  depleted  reserves.
As  to  credit,  the  banks  have  followed  the  procedure ­
  elsewhere  described  —  creating  in  the  special ­
  depositaries  new  or  additional  government  deposits ­
  to  the  extent  that  payments  have  been  made
in  this  manner.  Over  and  above  the  two  limitations ­
  operative  in  the  case  of  credit  payments  for
certificates,—  extent  of  qualification  as  government
depositaries  and  capacity  of  banking  resources  to
meet  subsequent  withdrawals  of  government  deposits ­
  —  a  third  limitation  has  figured  in  the  restrictions ­
  framed  and  to  a  limited  extent  imposed  by
44  Total  payments  to  December  19,  1918.