Driesch has supposed that the red granules of the circulation become a part of the wall of the new hydranth. The disappearance of the red granules at this time from the circulation would seem to give color to this view. But, on the other hand, I have found evidence showing that this interpretation is incorrect. In the first place, the granules that disappear from the circulation can be found lying in a ball within the digestive tract of the newly formed hydranth; hence their disappearance can be accounted for, and we find that they are not, or at least in large part are not, absorbed into the forming hydranth.[131] In the second place, there is a great increase in the number of endodermal cells in the region in which the hydranth is about to appear, and the thickening that results takes place some time before the granules begin to disappear from the circulation. The new granules appear in the new endodermal cells, and are presumably formed by them. Again, the hydranth, that develops later at the distal end, appears when there are no granules in the circulating fluid, and yet the hydranth may contain as much red pigment as does the proximal one. Lastly, the development of very short pieces shows that at the time of the formation of the new hydranth there is an enormous increase in the number of red granules in the piece, for there are many more of them contained in the new hydranth than were present in the entire piece at the time of its removal. Loeb has not referred to the red granules in the circulating fluid, but simply to the red pigment which is present in the walls of the piece. This is supposed to move forward into the hydranth region, and call forth the development of a new hydranth. A study of the number of the granules in the stem gives no support to this idea, and the method of formation of single and of double hydranths in short pieces shows that the increase in the number of granules in the hydranth-forming region is not due to migration, but to local formation.