more per capita than those received from the civil population. These gallant men are not only giving their services and their lives to their country but are lending their money as well to strengthen the Government in this great war for America's rights and world democracy.

As in the case of the first loan, every effort was made to facilitate the payment for subscriptions to the second loan, and subscribers were permitted to pay in the following installments: Two per cent with application; 18 per cent on November 15, 1917; 40 per cent on December 15, 1917; 40 per cent on January 15, 1918.

For the second loan the Federal reserve banks, as fiscal agents, issued their own receipts for payments received on bond subscriptions allotted, and the definitive bonds on full-paid subscriptions will be delivered at the time payment is completed, or very shortly thereafter, thus obviating the issue of interim certificates in the name of the Secretary of the Treasury.

During the second Liberty loan campaign it was possible to place on sale for over-the-counter deliveries, on full-paid subscriptions. not exceeding $1,000 each, a large amount of coupon bonds of the $50, $100, $500, and $1,000 denomination. Prior to the close of the campaign the following bonds had been furnished Federal reserve banks for this purpose:

The Secretary of the Treasury was authorized, under the act approved April 24, 1917, to issue Treasury certificates of indebtedness to the extent of $2,000,000,000 outstanding at any one time and at a rate of interest not to exceed 3 per cent per annum. The authorized amount outstanding at any one time was increased to $4,000,000,000, and the rate of interest was left to the discretion of the Secretary of the Treasury by the act approved September 24, 1917. The maturity of these certificates is limited to not exceeding one year.

The issuance of short-time certificates of this character has greatly simplified the large financial operations of the Government and facilitated the enormous transfers of credit involved in the bond issues of the Liberty loans. Most of the certificates have been issued with a maturity of from one to three months. The proceeds from

these issues have been used, in anticipation of receipts from longterm bonds, to meet the immediate needs of the Government and to extend credit to the foreign nations engaged in the war with Germany. The certificates have been sold quickly through the Federal reserve banks, the fiscal agents of the Government, and have been a means of providing for the requirements of the Treasury during the intervals between the sales of Liberty bonds.

In connection with both the first and second Liberty loans, the policy was adopted of issuing large amounts of certificates in advance of the bond issues and authorizing their acceptance as payments on bonds allotted. By this means a large part of each issue was absorbed in advance of its date, with the result that the same proportion of transfers of credit involved in the loan had been adjusted before the dates of payments on subscriptions. This method of temporary financing has proved wise and beneficial and has prevented disturbance in the money market which might have resulted if the operation had not been eased over a long period in this manner.

The total amount of certificates of indebtedness issued to November 1 was $3,388,698,000. Of this amount $50,000,000 were issued on March 31, 1917, before the war under the act approved March 3, 1917, in anticipation of internal-revenue taxes payable in June, 1917. Consequently the total amount of certificates issued on account of the war under the acts approved April 24, 1917, and September 24, 1917, was $3,338,698,000. A large part of these certificates have matured and been canceled.

The following table shows in detail the issuance of certificates through Federal reserve banks, the date of issue, the date of maturity, and the rate of interest:

LOANS TO FOREIGN GOVERNMENTS.

By the acts of Congress of April 24, 1917, and September 24, 1917, authority was vested in the Secretary of the Treasury, on behalf of the United States, with the approval of the President, to establish credits in favor of foreign Governments engaged in war with the enemies of the United States, and, to the extent of the credits so established, from time to time, to purchase at par from such foreign Governments, respectively, their several obligations, such obligations under the authority of the act of April 24 to bear the same rate of interest and to contain in their essentials the same terms and conditions as those of the United States issued under authority of the act, and under the terms of the act of September 24, to bear such rate or rates of interest, not less than the bonds of the United States, to mature at such date or dates, not later than the bonds of the United States then last issued under authority of either act, and to contain such terms and conditions as might from time to time be determined by the Secretary of the Treasury.

A total appropriation of $7,000,000,000 was provided for these purposes, $3,000,000,000 by the earlier act and $4,000,000,000 by the later. Under these authorizations credits have been established in favor of the Governments of Great Britain, France, Italy, Russia, Belgium, and Serbia, and advances have been made to those Governments as indicated in the following tabulation, which includes all such credits and advances up to November 1, 1917:

Of the credits and loans in favor of the Russian Government, $5,000,000 represents a loan to the Roumanian Government, the advance being made in this manner through the Russian Government in the absence of a Roumanian representative in the United States who could negotiate a direct loan to his Government.

The established credits indicated in the above table cover the period from the date of the passage of the earlier act, April 24, 1917, up to November 1, 1917, or a little more than six months. On the basis of the requests being made on the Treasury it was estimated that credits aggregating approximately $500,000,000 per month would be required to meet the urgent war needs of the foreign Governments receiving advances from the United States. With a balance of about $4,000,000,000 remaining available for the period beginning November 1, 1917, and with these credits averaging about $500,000,000 13034°- -FI 1917-2