The Birmingham age-herald., 1911-01-02
Most Important Financial Step Since National Banks
 Were Granted
SYSTEM DIFFERS FROM
 ANY OTHER IN WORLD
VIII Be Possible to Make Deposits of Ten Cents-Certifcate Can Be Ex- changed for United Bonds
 Payable in Gold

- practical institution of the postal savings bank system next Tuesday, January 3, the United States government will af- ford to the people of the United States facilities for the saving of a part of tlieir earnings. The establishment of postal savings banks is regarded as the most important and far-reaching fi- nancial step taken by the government .since the authorization of national banks and their operation will be watched with keen interest by financiers throughout the world.
 The new system is to be inaugurated on a comparatively small scale. One postoffice in each state and territory has been selected as a depository. In these AS offices thorough test of the new system will be made. It was decided to make the beginning small not only be- cause no adequate appropriation was available to put it into general operation but also because the plan of operation adopted differs entirely from that of any postal savings system In the world. The scheme is the result of many months of work and research by committees of postal and banking experts whose efforts were directed by the board of trustees consisting of the Postmaster General, the Secretary of the Treasury and the Attorney General
 No passbook will be furnished the de- positor but all deposits will be evidenced by engraved postal savings certificates, issued in fixed denominations of Sl, s2, s, s10 s20 and $50, each bearing the naine 5 of the depositor and the date on which interest begins to accrue. The certificates are non-transferable and non-negota- h Int na at the rate of ? per cent per annum.
 Minimum Account Is &1
 By the terms of the law no account for less than $1 may be opened and no person may deposit more than s1Oo in any calendar month or have to his credit at any one time more than $500, exclu- sive of accumulated interest. Accounts may be opened by any person over 10 yoars of ago in his or her own name and rAny married woine,l iu heir own ',ames. The accounts of wives cannot be inter- fertd with or controlled by husband.
 For the present deposits will be limited to patrons of the postoffice at which thc system is established. The service Is entirely free, no fee being required in connection with the opening of an ac- count or the withdrawal of money de- posted. No person connected with the 4 postoffice department will be permitted q to disclose either the name of depositor or the amount of his deposit unless di- rected to do so by the Postmaster Gen. eral Deposits may be withdrawn at any J time with accrued interest or the interest aone may be withdrawn.
 While deposits of less than $1 will not be received, small amounts may be saved for deposit by the purchase of postal savings cards at 10 cents each and of To- cent postal savings stamps, which have been especially prepared for the purpose, and will be on sale in all depository of fices. Each postal savings card contains blank spaces to which 10-cent savings stamps may be affixed as purchased. The postmaster will accept a postal savings p card with nine 10-cent savings stamps af- ' fixed as deposit of si either in opening an account or in adding to an existing account This feature is expected to ap- peal particularly to children and to en- courage in them habits of thrift.
 Exchange, Certificates for Bonds
 An interesting and valuable feature of the system is tSe privilege accorded to a depositor of corverting his savings into United States bonds to be issued in de- nominations of $Q, $40. $6O, $s0 and s100 and multiples of 500 up to and including $500 The bonds will be issued in both registered and coupap form and will bear interest at the rate If 2la per cent, pay l deemable at the pleasure of the United States one year from the date of issue, both principal and inteest being payable 20 years from date of fsue in gold coin. No limit is placed on theamount of these \ bonds a depositor may &quire and the N bonds are not counted aAa part of the maximum of $500 allowed t\ \one depositor Most of the funds receved from deposi- tors will be placed in local hnks through Ivy Sn xxri1I he available for the currentN commercial needs. These deposits will Unsecured by bonds deposited by the bank, with the treasurer of the United States Five per cent of the deposits will he h,d by the treasurer of the United Statesas a re- eerve and the board of trustes is au- thorized to invest 30 per cent \ United States bonds The faith of tht United States Is pledged solemnly to te pay ment of all deposits with accred in terest.
 The savings certificate plan of i9icat- ing deposits was adopted upon the fcon1- mendation of the committee of eAerts appointed last June by Postmaster Zen cral Hitchcock. It was found thaHhe expense of operating the psssbook ys- tem in foreign countries was very gltt the central office in England requiring Ne services of several thousand bookkeepse to transact the postal savings busnet Under the certificate plan this expen largely Is eliminated. Each certifcatf sued will speak for itself It Is beiiev the system adopted will afford every saf guard provided by tho foreign pla without their complexity of detail al unwieldiness of the operation.
 A certificate will be payable only the person whose name it bears. and lost may be replaced by new certiflca
 upon satisfactory proof of loss by t
 dcpositor.
 Tn the list of postoffices designated
 Postmaster General Hitchcock as post
 savings Repositories are the followir all being of the second class:
 Bessemer. Ala; stuttgart, Ark; K
 West, Fla; Brunswick, Ga; Middlesbo
 ky: New Iberia. La; Gulfport. Mis-
 Eaton. N. M.; se'isbury. N. C.; Guym'
 Okla. Newber VI Ns c.; Johnson - ci
 Tenn; Port frthnA 'eS' ana ehi' Forge. Va.
 If the system sa Should prove s'
 ccssful 1t Is plt me sxtend the serv
 as rapidly as Srae 3e. In time pr'
 sblvl every moa~e [ postoffice in
 country will be ps Ai savings depe
 t0rv.