New Britain herald., 1917-04-30
MONEY DISTURBANCE
 TO BE PREVENTED
Federal Board Has NewsP Plan for Sale of War
 Bonds.

Washington, April 3O.-The federal
 board has recommended to Secretary
 McAdoo that funds to be raised under
 the $7,00o, 100000 war loan be ob-
 tained gradually by offering to the
 banks of the country blocks of treas
 ury certificates to be retired later with
 bonds every two weeks.
 Indications are that Secretary Me-
 Adoo soon will announce the offer of
 another block of certificates. The pro- ceeds will. be applied to loans to be
 made to France, and Italy. which will
 total from $2O0,000,00O to $30O,00O,- OOO.t The federal reserve boards SuggeS- tion contemplates that the certificates be offered to highest bidders. no of- fer below par being accepted. The offer would be open to all banks of the country, state and private institu- tions as we'll as members of the re- serve system and to individuals. Certificates would be convertible into bonds or payable in cash at the option of the holder. If taken by the
 banks exclusively the certificates could
 be used in lieu of cash in paying for
 bond subscriptions.
 Under this plan bank depositors
 who subscribe to the bonds would not
 have to forward cash, but could for- ward certificates, thus strengthening it's financial position and avoiding the
 risk of disturbances in the money
 market by large withdrawals of l moneys in payment for bonds.
 The board today began it's consid- eration of the needs of France at a
 
 French delegation. Many to Enter Reserve System. ; Assurances have been received by the federal reserve board from sources of state banks and trust companies throughout the country that they will enter the federal reserve system up- on the passage of amendments broad ening the scope of the law now before congress. .
 At least twenty of the largest trust companies and state banks have signi- fled their intention of joining the system if the amendments pass The amendments have been favorably re- ported and their passage appears like ly. Hundreds of banks have indicated
 they will follow the large institutions into the system. In Arkansas alone it is said virtually every one of the 1S0
 state banks is ready to join.
 The largest state banks and trust
 companies reported to be ready to join the reserve system are in New York, Chicago, St. Louis, Kansas City, San Francisco, Detroit, Mil waukee, Atlanta, Seattle, Spokane and Portland, Oregon.
 Less than fifty state banks and trust companies have joined the sys- tenn during the three years of it's | existence. All national banks under 1 the law automatically passed to mem- i bership and in addition approximately
 one hundred state banks and trust 1 companies took national bank char
 ters to come into the system. 1 Approximately 7,6O0 banks now are
 in the system and the number of state 1 banks and trust companies including l private institutions outside totals about 22,OOO. Not all those would 1 join nor all be wanted, but indications 1 are the strongest and most desirable i of the entire group will make appli-
 cation for membership. Resources l of the system, already approximately $16,O0O, 100000, would be more than
 doubled.