Evening star., 1919-02-19
SHORT-TERM NOTES
FOR VICTORY LOAN
House Committee Provides
for Bonds to Mature in One
to Five Years.
DRIVE TO BEGIN APRIL Fl

me victory ioerty loan drive
which is to start April q will be An
intensive popular campaign. and will
dispose of short-term Treasury notes
maturing in from one to five years.
This was practically decided yes
terday- The House ways and means
committee tentatively agreed upon
the short-term notes instead of long
term notes, preferring to restrict the
terms of the loan by legislation
rather than to leave them entirely to
the discretion of the Secretary of the
Treasury, as asked by that official.
Secretary Glass announced the open
ing date of the new drive. and in
statement explained that the popular
campaign would be carried out ire
spective of whatever terms Congress
may arrange.
The Secretary had asked Congress
for authority to issue either bonds
or notes as market conditions at the
time might warrant, but members OF
the committee concluded that a new
loan issue would necessarily carry
with 1t such a high rate of interest
versely affected for some time.
Committees Tentative Agreement.
Under the tentative agreement of
the committee, reached in executive
session at which Assistant Secretary
Leffingwell of the Treasury was
present, Secretary Glass would be
given discretion of issuing any one
of several of four kinds OF notes TO
be prescribed by the legislation. The
Quantity of these non-negotiable Sc
curities would be limited to probably
81. 900, 600. 900, of which the Treasury
now plans to issue only about So
900. 900, 600.
The principal features of each OF
the four kinds of notes proposed
would be as follows:
One class would be at low rate or
interest, possibly 4 per cent, and be
exempt from all federal taxation; one
would be at comparatively hlgn
rate. possibly 5 per cent. and suelect
to all federal taxes: third would
bear a moderate rate of interest-4A
per cent was suggested-and be ex-
empt from normal income tax leVies;
the fourth would be exempt from tax
alton up to certain amount.
Terms Not Yet Defined.
These terms have not yet been de-
fined. but Treasury officials said the
proposed alternatives would satisfy
the Treasury Department They cover
all the possible terms which the
Treasury might choose even if 1t had
broad discretion, it was explained. In
denomination the notes probably
would correspond with past liberty
loans, ranging from $50 up. Mem
bers of the committee felt this would
permit of as wide sale as In pre-
vic he rf-fa
notes would prove more attractive to
the small investors.
The ways and means committee also
decided tentatively not to increase
the authorization for issuance of
bonds from about s5,000.o00, 600 to
SO, ZOO, 900, 600. This means that the
Treasury still would have power to
bonds at the 4 u per cent rate of the
last two loans, and with the same
terms. Most officials believe that these
securities could not be foated advan-
tageousiy under new conditions, and
consequently that the Treasury would
cation at this time, 1t is possible.
however. that some of the notes to be
! issued would be convertible in the
next three or four years into liberty
bonds of longer maturity.
The draft of the proposed legisla-
| tion for the short-term notes was
ordered by the committee, and it's
experts began Immediately to consider
the plans for the new measure 1t is
expected to be completed IN a rev
days, with final action to be followed
shortly by the committee When THE
forts viii be made by Chairman n
kitchfn to expedite passage of the
legislation before the adjournment
of the present Congress.