CHAPTER V 
Investment of Postal Savings Funds 
The most difficult problem, it has been said, 
which Congress had in formulating its postal 
savings bank plan in 1910 was that of the invest 
ment of the deposited funds. This problem, we 
have seen, 1 was solved by dividing the funds into 
three parts : ( 1 ) A 5 per cent reserve fund to be 
kept in lawful money in the Treasury of the 
United States; 2 (2) a sum not exceeding 30 per 
cent of the amount of postal savings funds, 
which “may at any time be withdrawn by the 
1 Supra, pp. 43-44. 
2 The 5 per cent reserve held in the United States Treas 
ury at Washington is adjusted only once a year, and, inas 
much as there has been an increase of deposits during each 
year, the percentage of reserve as adjusted declines 
throughout the year. With deposits growing as rapidly as 
those of the postal savings system, such a long interval be 
tween the dates of the adjustments of the reserve results in 
the maintenance of a reserve which averages far below 5 
per cent. Probably a 5 per cent requirement is unnecessar 
ily high under the circumstances. If so, it should be re 
duced by law. To make the percentage of the reserve vary 
inversely throughout the year, as at present, with the amount 
of postal savings deposits seems to be a questionable policy. 
Cf. Ann. Rep. 3 Assist. Postmast.-Gen., 1913, p. 37.