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Federa l Reser ve






J, 196h

To All Issuing Agents in the
Eleventh Federal Reserve District:

We have been advised by the Treasury Department that at the
present time it does not appear that the Treasury will be able to finance
from its 1965 appropriation any buildup of inventories of United States
Savings Bonds, and that actually it will need to reduce further existing
balances to save on printing costs this year.
Issuing agents for savings bonds and Federal Reserve Banks and
their Branches now have on hand 28,000,000 pieces which are sufficient
to cover more than three months1 issues including spoils. It would ap­
pear that some reduction in this overall inventory might be realized if
the larger issuing agents, which are normally agents that submit weekly
sales reports, would maintain inventories equal to no more than amounts
required for estimated issues for one month, and to requisition additional
supplies from month to month when stocks on hand dropped to levels cover­
ing 10 to 15 days' issues. On this basis, they would have on hand and
on order sufficient quantities of bonds to cover one and one-half months1
The number of stock shipments would be increased perhaps out
of proportion to potential savings if this same practice were applied
to smaller agents. However, overall inventories would be decreased if
smaller agents reduced their requirements to minimum and maximum levels
of not exceeding one and three months1 requirements and requisition
stock only when their inventories dropped below one month's requirement.
We believe that if issuing agents follow the procedure outlined
in ordering and maintaining stocks of savings bonds, it would lower
Treasury Department printing costs, and at the same time reduce the con­
trol problems of the issuing agents, as well as reduce to some extent the
agents' risk of loss.
Your cooperation in complying with the request of the Treasury
Department will be sincerely appreciated.
Fiscal Agent of the United States

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