There really is no question about this one. The other people are correct. The word fragment "UBTREAS" clearly does stand for "Subtreasury." The author presumably includes this word fragment, along with his description of the "building with the starry ceiling," to let us understand that the City of the Gods is actually New York City. The author probably does this because he wants us to realize that he is warning us about the sorts of calamities our own world would be facing if it continued on the path down which it was going. Benet was writing this story in 1937, when the Spanish Civil War was going on and the city of Guernica had just been bombed. This event made him consider the destructive power of the modern technology of the time. He wrote "By the Waters of Babylon" as a cautionary tale. In order to make it more effective, he needed to state quite clearly that the ruined civilization that John sees is our own civilization.
Thus, we can say that the fragment "UBTREAS" is one of the clues that tells us that this part of the story takes place in New York City.
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