cting the war with
Germany.

The Administration's first nation-wide appeal was for money. Under the
Bond Bill it was empowered to raise war funds, and proceeded to do so
by floating the first issue of the "Liberty loan of 1917," this being
a demand for $2,000,000,000 from the popular purse. The money raised
was to provide credits to the Allied governments to meet the enormous
war purchases they were making in the United States, and, like
previous accommodations to them, this provision of funds was not so
much a loan as a transfer or exchange of credits. American money was
lent to the Allies, deposited in American banks, to enable them to buy
American products. Not a cent of the Liberty loan went out of the
country.

It was the largest single financial transaction ever undertaken by the
United States Government. It greatly exceeded all previous bond issues
and squarely brought the country to face the necessities of war
finance on a huge scale. But the prewar period, which produced a high
tide of prosperity, due to the unexampled calls on American industries
by the Allied Powers, had revealed the enormous wealth and economic
strength of the American investing community, as well as a
flourishing condition of the working population. The Government
entered upon the financial operation with no misgivings and the result
proved its confidence in the success of the loan. Bank subscriptions
were discouraged. National loans hitherto issued in war time were
floated as a basis of national currency and were taken up by the banks
in large amounts. But the Liberty loan was an appeal to the
million--to several millions; to the man in the street, the small
tradesman, the salaried class. Workers realized that in subscribing to
the loan they were not only securing an absolutely safe investment,
but were providing funds for wages and profits. The money they
invested as a loan to the Allies was applied by them to buying
American goods.

The Liberty loan was floated on May 14, 1917, in denominations as low
as $50, rising to $100,000, at 3-1/2 per cent. interest, redeemable in
fifteen or thirty years. The banks of the country, national and State,
the trust companies, newspapers, department stores, express companies,
and numerous corporations and firms placed their establishments and
staffs at the national service for receiving applications, which came
from all classes. The response flagged as the date for closing the
subscription lists ne