SECURITY DELIVERIES, LOANS, AND TRANSFERS 361 
sale contracts. A description has already been given® of the 
methods whereby commission houses finance their transactions 
in securities requiring credit accommodations, by means of 
these collateral time and call loans. The latter type, since they 
are payable on demand, are constantly being shifted. F ormerly 
this process of shifting a demand loan from one lender to 
another, created a fairly steady need of temporary banking 
accommodation on the part of Stock Exchange houses. 
In case Jenkins & Co. had its loan for $100,000 called by 
the lending bank A, the firm would make an agreement with 
bank B to obtain from it a similar sum on the collateral then 
reposing in A’s vaults. But Jenkins & Co. might not find it 
convenient to obtain this security collateral from A until it had 
B’s check for $100,000 with which to retire A’s loan; on the 
other hand, Jenkins & Co. could not obtain the funds from B 
until it had delivered the same security collateral to B's loan 
window. Thus Jenkins & Co. might find itself in the tem- 
porary dilemma of not being able to get the money loan until 
it got its securities, and not being able to get its securities until 
it got the money loan. 
This situation was somewhat similar to that previously 
described” in connection with the receipt and delivery of securi- 
ties which the firm had purchased and sold, and it was solved 
in much the same way. Just as the banks make “day loans” to 
brokers which enable the latter to pay for securities which they 
have purchased and are due to receive in the settlement, so too 
“day loans” are furnished the brokers as temporary accommo- 
dation for a few hours wherewith to shift collateral loans. 
Thus, Jenkins & Co. would obtain such a “day loan” at Bank 
C, draw upon it and have certified a check for $100,000, deliver 
the check to A, get the security collateral, turn it over to B, 
get B’s check for $100,000 and turn it over to C, thus retiring 
the firm’s “day loan” at the latter institution. 
In order to effect an economy in the amount of such “day 
See Chapter XI, p. 287