130 
POSTAL SAVINGS 
130 
shown that postal savings funds come largely 
from hoards and from accumulations that would 
otherwise be sent abroad by our foreign born. As 
previously noted, 87 per cent of the postal sav 
ings bonds purchased are in the registered form 
and presumably for permanent investment. All 
this seems to indicate that postal savings funds 
are more nearly capital funds than current busi 
ness funds. Yet our depository system puts the 
great bulk of them into commercial banks. 
Should the system not be changed so as to divert 
a larger part of these savings into savings banks 
where they will be feeders for society’s more per 
manent capital equipment? 
At the present time this question is particm 
larly opportune, for the evidence is strong that 
the next few years will witness a substantial in 
crease in interest rates. This increase will bear 
heavily upon our mutual savings banks whose 
assets in the form of long-time bonds and mort 
gages are likely to decline in value at just the 
time that the higher interest rates payable on 
securities will be attracting funds away from 
savings banks into fields that appear to be more 
remunerative; for example, small denomination 
bonds. A more liberal use of savings banks as 
depositories for postal savings funds would assist 
these worthy institutions to tide over a trouble-