In June 1930 Einstein visited Cambridge where he stayed with Eddington who had just shown that Einstein's supposedly static universe of 1917 was not stable. This forced Einstein to rethink his cosmology. He spent January and February 1931 at Pasadena. There, he discussed cosmology intensely with Tolman, conscious that he had to replace his original model of 1917. However, at the end of February he still had not made up his mind about an alternative. The Albert Einstein Archives of Jerusalem (AEA) hold an undated draft, handwritten by Einstein, which I date to the beginning of January 1931. In this draft Einstein hopes to have found a solution to the cosmological problem: a stationary, dynamic universe in expansion. His model was stationary because particles leaving a given volume were replaced by particles created out of the vacuum, anticipating an idea of Bondi, Gold and Hoyle published in 1948. He saw the cosmological term as energy reservoir. However, he realised that his calculations contained a numerical error. When the error was corrected his steady-state-model collapsed.