Federal Reserve Bulletin, 1979-01

JANUARY 1979 FEDERAL RESERVE BULLETIN The Economy in 1978 A Proposal for Redefining the Monetary Aggregates Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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VOLUME 65 • NUMBER 1 • JANUARY 1979 FEDERAL RESERVE BULLETIN Board of Governors of the Federal Reserve System Washington, D.C. PUBLICA HONS COMMITTEE Joseph R. Coyne, Chairman • Stephen H. Axilrod • John M. Denkler Janet O. Hart • James L. Kichline • Neal L. Petersen • Edwin. M. Truman Michael J. Prell, Staff Director The FEDERAL RESERVI Bum n\ is issued monthly under the direction ot the stall publications committee. This committee is responsible foi opinfc ns expressed except in official statements and signed articles Direction for the art woik is provided by Mack R. Row©., Editorial support is furnished b\ the Economic Editing Unit headed by Mendelle T. Bercnson. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Table of Contents 1 THE ECONOMY IN 1978 Divestiture plans of bank holding companies to be filed by September 30, 1979. As the U.S. economic expansion continued into its fourth year, activity was un- Proposed board actions: Regulations for even and growth more moderate while consumer protection under the Electronic inflation was still a problem. Fund Transfer Act; rules to implement new legislation tightening restraints on lending by member banks to insiders; dis- 13 REDEFINING THE MONETAR Y AGGREGATES closure requirements of the annual per- The board's staff has proposed a revision centage rate under truth in lending; and of the current measures of the monetary establishment of an international banking aggregates because of the heightened pace facility in New York City. of regulatory changes and financial developments in recent years. Issuance of "Consumer Handbook to Credit Protection Laws," 43 INDUSTRIAL PRODUCTION Admission of one state bank to member- Output rose approximately 0.6 percent in ship in the Federal Reserve System. December. Publication of 1977 Consumer Credit Survey, 45 ANNOUNCEMENTS Preliminary figures for 1978 indicate gross 51 RECORD OF POLICY ACTIONS OF THE current earnings of the Federal Reserve FEDERAL OPEN MARKET COMMITTEE Banks to be $8,455 million. At the meeting on November 21, 1978, Bank procedures for defaulted municipal the committee agreed to instruct the mangeneral obligation bonds. ager to seek a federal funds rate of around Adoption of amendments to Regulation Y 9% percent early in the period before the concerning publication of the intention of next regular meeting and subsequently to bank holding companies to engage in maintain the rate within a narrow band of nonbank activities and the procedures for 9% to 10 percent. With regard to the commencing nonbank activities abroad. specific objective for the rate within that (See Law Department.) range, the committee instructed the manager to be guided mainly by a range of Adoption of uniform guidelines for the tolerance for the annual rate of growth in enforcement of the truth in lending law M-2 over the November-December period and its implementing regulations by the of 6 to 9V£ percent, provided that the rate five federal regulators of financial instituof growth in M-l over that period did not tions. exceed 5 percent. It was understood that New officers and members of the Con- the chairman might call upon the commitsumer Advisory Council. tee to consider the need for supplementary Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

instructions before the next scheduled A69 GUIDE TO TABULAR PRESENTATION meeting if significant inconsistencies ap- AND STATISTICAL RELEASES peared to be developing among the committee's objectives. A70 BOARD OF GOVERNORS AND STAFF 63 LAW DEPARTMENT All OPEN MARKET COMMITTEE AND STAFF; ADVISORY COUNCILS Amendments to Regulations Q and Y, various rules and bank holding company A73 FEDERAL RESERVE BANKS, BRANCHES, and bank merger orders, and pending AND OFFICES cases. A74 FEDERAL RESERVE BOARD PUBLICATIONS A1 FINANCIAL AND BUSINESS STATISTICS A3 Domestic Financial Statistics A76 INDEX TO STATISTICAL TABLES A46 Domestic Nonfinancial Statistics A54 International Statistics A78 MAP OF FEDERAL RESERVE SYSTEM Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1978 Moderate Expansion and Persistent Inflation This article was prepared by Albert M. Teplin In part, the slowing of growth in 1978 was of the National Income Section of the Division also attributable to reduced stimulus from the of Research and Statistics. government sector. Federal government outlays were again well below early budget estimates The economic expansion continued into its and the deficit was reduced from a year earlier. fourth year in 1978, albeit at a more moderate Spending by state and local governments conpace. Employment gains were again large and tinued to be moderate, reinforced by the effects the unemployment rate edged down further of Proposition 13 in California and by related despite sizable increases in the labor force. initiatives in other states. By the fourth quarter, Inflation posed major problems, however, with the large operating fiscal surpluses experienced price increases accelerating in most areas and in this sector for several years had been virtually the overall rate of price rise the highest since eliminated. 1974. The U.S. international trade deficit began to The economy started 1978 on a hesitant note narrow during the year because of a sharp rise when the effects of a prolonged coal strike in merchandise exports after the first quarter. combined with the disruptions of unusually se- This improvement resulted largely from an invere winter weather to halt economic growth crease in economic activity abroad relative to (chart 1), The vigorous bounceback of activity that in the United States. Nonetheless, the that followed during the spring quarter was foreign exchange value of the dollar depreciated indicative of considerable underlying strength in substantially throughout most of the year. aggregate demand. In the third quarter the pace The decline in the value of the dollar was of output growth moderated from the first-half but one development linked to the acceleration average, although activity picked up in the final of price increases in 1978. The pick-up in inflaquarter of the year. Business capital outlays provided the founda- 1. Growth in GNP tion for much of the year's expansion in aggregate activity, with strength most evident in nonresidential construction expenditures (chart 2). Meanwhile, inventory investment remained generally cautious, with stocks in close alignment with sales in most sectors, A reduced growth of spending by households exerted a moderating influence on the pace of economic activity as consumers reacted to the slowing in real income gains and to the record level of debt burdens. In addition, expenditures for residential construction, one of the most supportive sectors earlier in the expansion, le- 1974 1976 1978 veled oft in real terms, as total housing starts Department of Commerce data, seasonally adjusted at comremained at a high level. pound annual rates. "Rear' is in terms of 1972 dollars. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

2 Federal Reserve Bulletin • January 1979 2. Components of final sales dollar, a comprehensive package of policy measures was implemented by the administration and the Federal Reserve in late October and early November. It. included a commitment to prudent fiscal restraint and regulatory reform, wage and price standards, stepped-up intervention in exchange markets to support the dollar, and increases in the Federal Reserve discount rate and in member bank reserve requirements. These actions were aimed toward an unwinding of the wage-price spiral in an environment that continues to facilitate a moderate expansion of overall activity. Quarter after trough While the near-term impact of these policies Based on Department of Commerce data, seasonally adjusted at annual rates in constant (1972) dollars could dampen the expansion of the economy, at year-end there was evidence of continued tion was widespread, with food and homeown- momentum, as sales and production registered ership prices in particular accelerating rapidly. sizable gains. Inventories remained lean relative Moreover, cost pressures intensified, as there to sales and the pace of housing activity continwere sizable gains in wages and little increase ued strong; problems in these two sectors have in labor productivity over the year. frequently been associated with disruptions of The persistence of high rates of inflation ap- previous upswings. Even so, there were mixed parently led to a number of distortions in the signs about the prospects for activity elsewhere. pattern of economic demands. Although growth In the business sector, data on anticipations of personal consumption slowed, it continued suggested a slowing of growth of capital outlays to account for an unusually large proportion of over the course of this year, while at the same total product. The relative strength of consumer time new orders implied further increases in spending appears to have been associated, in business fixed investment activity in the next part, with purchases of durable goods in antici- few quarters. In the household sector, sentiment pation of further price increases—a phenome- weakened and debt burdens remained excepnon that could reduce future demands. Simi- tionally heavy. Nonetheless, a spurt in retail larly, the record number of home sales in 1978 sales during the fall and early winter suggested appeared to reflect the notion that homeown- that consumers remained reluctant to cut back ership remains one of the few effective hedges on spending. Thus, while there is- some reason against inflation. This buy-ahead phenomenon to expect economic growth to moderate further has led to unprecedented household indebt- over 1979, there is no concrete evidence of such edness as well as to a personal saving rate at a slowdown yet. the lower end of the postwar range. In the business investment area, accelerating inflation INCOME AND CONSUMPTION continued to augment uncertainties about the future course of the economy and undoubtedly Real disposable personal income grew about 3 lessened the willingness of firms to commit percent over 1978—more slowly than in the funds for major expansion programs. While thus previous three years of the expansion (chart 3), far growth in aggregate activity has been sus- A large nominal gain in private wage and salary tained, a further worsening of inflationary trends disbursements reflected the strong growth of could lead to the types of severe imbalances that employment together with an acceleration in the have halted earlier expansions. rate of hourly wage increases. However, larger In an effort to ease inflationary pressures and tax burdens cut into the gain of real disposable to stabilize the foreign exchange value of the income; increases in personal contributions for Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1978 3 held up fairly well in the first quarter, soared 3. Income, consumption, and saving to an annual rate of 12.1 million units in the second quarter—just short of the record set in the spring of 1973 (chart 4). Sales of other durable goods were also up sharply, and large increases were recorded for expenditures on clothing and shoes. In the second half growth in personal consumption was more brisk than the average pace in the first half. Durable goods sales continued to grow rapidly; although automobile sales edged down to a rate of 11.1 million units, Based on Department of Commerce data in constant (1972) dollars. Percentage changes are calculated from Q4 to Q4. demand for furniture and other durable goods, such as books, jewelry, and recreation equipment, picked up. In addition, increases in pursocial security went into effect in January and chases of nondurable goods were quite large, the interaction of inflation and a progressive tax particularly in the fourth quarter. system raised effective personal income tax Despite somewhat smaller growth in the conrates. stant-dollar value of consumption last year, its The slower growth in incomes was reflected proportion of gross national product held at the in a smaller gain in consumption expenditures. Over the year, real consumer outlays rose 3% 5, Ratio of durable goods consumption to GNP percent compared with an average pace of 5VI Percent percent during the previous three years of economic recovery and expansion. Early in 1978 the severe weather depressed retail sales. By the end of March near-record cold had raised real outlays for fuel, electricity, and natural gas significantly above their levels a year earlier. As often occurs when unforeseen adjustments must be made to household budgets, expenditures for furniture and household equipment fell Quarter after trough sharply, along with spending for most nondurable goods. Based on Department of Commerce data in constant (1972) dollars. In the spring consumer purchases rebounded markedly. Total automobile sales, which had high level experienced since early 1975. At similar phases in prior expansions this share 4. Auto sales typically has fallen. In particular, household Millions of units spending for durable goods has hovered at around 10 percent of GNF over the past three years, while during other economic expansions it has usually declined to about llk percent (chart 5), The surge in consumption and the associated increase in installment credit over this expansion have been attributed, in part, to the higher relative number of younger households but "also appear to have been associated 1974 ' ' 1976 ' ' 1978 with persistently high inflation rates. Opinion Data from Ward's "Automotive Reports.!" surveys, for instance, suggest that a subtantial Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

4 Federal Reserve Bulletin • January 1979 proportion of consumers have been buying du- percent in real terms during 1978 compared with rable goods in anticipation of price increases. increases of more than 10 percent in each of In addition, due to federal tax reforms in the the previous two years. With machinery outlays 1970s and to the large increases in the wage advancing at about the same relatively moderate base for payroll taxes, a greater share of the pace recorded in 1977, the slowing of gains in growing volume of after-tax income has been the equipment area reflected a trailing oft of directed to middle- and lower-income groups business demands for motor vehicles. who have thus had the opportunity to satisfy Investment by manufacturers grew 13 percent some previously unmet demands for durable in nominal terms, about matching the gain regoods. corded in 1977. Within this sector, increases were largest among producers of durable goods, particularly stone, clay, and glass, electrical BUSINESS FIXED INVESTMENT machinery, and aircraft. In the nondurable Real business fixed investment rose 8% percent goods industries, producers of rubber products over 1978. This was nearly the same pace as and food had relatively strong gains also. Matein the two previous years and about twice as rials producers, which include some manufacfast as the expansion of aggregate activity. Al- turers in both the durable and nondurable catethough capital spending was hampered early in gories, continued to show only a small advance the year by severe weather and the coal strike, in capital spending. Outside the manufacturing the rebound in the spring was sharp and real sector, the largest rise was evident in the air growth was at an annual rate of 12 percent over transportation industry. In addition, railroads, the first half. During this period the level of communications, and electric utilities had such expenditures first exceeded the peak in above-average increases for the year, although 1973, much later than the typical cyclical per- spending by utilities slowed noticeably in the formance. In contrast to the rapid growth early second half. in 1978, real business fixed investment ad- Many of the underlying determinants of capivanced at an annual rate of only 4VI percent tal spending moved somewhat less favorably during the second half. than in the preceding year. Final sales and Nonresidential construction activity became a profits grew more slowly than in 1977. Also, principal source of business investment growth financing costs were boosted by higher interest in 1978, after having been slow to recover rates and increases in dividend-price ratios of earlier in the expansion (chart 6). Over the year, equities. However, capacity utilization in the real spending for such structures increased about manufacturing sector moved close to 86 percent 13 percent as outlays for commercial and in- at the end of the year, well within the range dustrial buildings showed particularly impres- that typically signals a need for capacity expansive gains. On the other hand, investment in sion (chart 7). Nevertheless, in the materialsproducers' durable equipment grew about 6V2 producing sector, where supply constraints in the past have led to sharp price increases, there 6. Business fixed investment appeared to be adequate reserve capacity, with utilization rates averaging about 87 percent compared with the 93 percent rate reached in 1973. At year-end, advance indicators of capital spending were mixed, reflecting uncertainty about the period ahead. After having been relatively flat in the summer months, contracts and orders for plant and equipment exhibited sub- 1975 ' 1976 ' 1977 ' 1978 stantial upward momentum, suggesting a continuation of moderate growth in the near term. Based on Department of Commerce data, seasonally adjusted at annual rates in constant (1972) dollars. Longer-term indicators, however, were less en- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1978 5 1 Capacity utilization in manufacturing kets; average prices of homes sold—both new Percent and .existing—rose almost 20 percent. Even after adjustment for upgraded quality, prices of new homes were up 15 percent in 1978. Over the year interest rates on both con- ^ \ \ / struction loans and long-term mortgages rose appreciably until by year-end they had reached usury ceilings in a number of states and record f postwar highs in many other areas. Even so, the variable-rate, six-month time accounts intro- 1972 ! ' 1974 ' ' 1976 1978 duced in June buoyed deposit growth at key Federal Reserve data, based on seasonally adjusted production indexes. mortgage lenders and helped maintain the high rate of housing construction. Over all, growth couraging. Surveys of business revealed plans in net mortgage holdings of thrift institutions for 1979 that, if realized, would result in a is estimated to have fallen by about a tenth in marked slowing of capital spending growth in 1978. Increases in net lending by commercial real terms. Capital appropriations in the manu- banks, by federally related lenders, and via facturing sector also suggested more moderate passthrough securities helped to offset the deincreases for 1979 than in 1978. While the cline in net acquisitions at thrift institutions. recent past has been characterized by upward Thus, residential mortgage debt formation in revisions of business plans as the year pro- 1978 is estimated to have been close to the gressed, the upgrading would have to be con- record level of the preceding year. siderable for growth in capital spending in 1979 Single-family starts—at 1.4 million units— to match that of the 1976-78 period. were virtually unchanged from 1977 and an unusually large number for the fourth year of an expansion. New-home sales remained at an RESIDES /mL ComTRUCTION advanced level and were more than 50 percent Private housing starts were sustained at the high greater in 1978 than during the recent low in annual rate of 2 million units during most of 1975. Demand for homeownership was particu- 1978 (chart 8). Nonetheless, total spending for larly strong in the West and South. residential construction in real terms edged Multifamily housing starts were up nearly a down 1 percent over the year, compared with tenth in. 1978.from their level a year earlier; an average annual rate of increase of 15 percent nevertheless, at about 600,000 units, they reduring the previous three years. Inflation con- mained well below the levels of the early 1970s. tinued to be especially visible in housing mar- Last year's strength was supported by an increase in federally subsidized rental units under the section 8 program of the Department of 8. Housing starts Housing and Urban Development. Such units, Ratio of units for low- and moderate-income families, ac- 2.0 counted for about 25 percent of all multifamily starts during the year, compared with 18 percent 1.0 in 1977. The viability of private multifamily proj- .5 ects—especially in the rental area—remained a major concern to investors in 1978. Although vacancy rates dropped to historically low levels in many areas, the largest population growth in recent years has been in the age groups in which the desire to own single-family homes is Department of Commerce data, seasonally adjusted at annual strongest. Furthermore, prospects for the profitrates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

6 Federal Reserve Bulletin • January 1979 ability of rental units continue to be doubtful quarter, the pace of accumulation accelerated because increases in rents have remained mod- further as production rebounded and coal stocks erate relative to rising operating costs. On the were built up again. In the second half of the other hand, new multifamily units built for sale year the rate of inventory investment as a whole have sold very rapidly in the past few years. leveled off, reflecting efforts by businesses to At year-end, housing activity was well main- keep stocks firmly under control. tained. Sales of new single-family homes, The manufacturing sector built inventories at which had fallen during the summer, turned up a fast pace throughout most of the first half— again. Total starts remained close to an annual especially in the second quarter—-and into the rate of 2 million units, despite the general tight- summer. During the first nine months of the ening of financial markets. However, continuing year, most of the inventory investment at maneconomic expansion would likely put further ufacturers was in durable goods. Nonetheless, pressure on the balance between the sources and since sales gains were in this area also, the uses of funds at mortgage lenders. Furthermore, inventory-sales ratio for durable goods was high interest rates make questionable the sus- fairly stable. Moreover, the inventory-sales ratio tainability of housing demand in the year ahead, for all manufactured goods remained quite low especially in view of the already large debt on an historical basis. burdens of households. Wholesale and retail trade accumulation was about evenly divided between durable and nondurable products during the first three quarters. BUSINESS IS \ EN I OR i IN VESIMMN I In the first quarter auto stocks at dealers reached Investment in business inventories was charac- record highs. However, the extraordinary pace terized by continuing caution, in 1978, and as of sales during the spring and summer resulted a result, inventory-sales ratios ranged from low in reduced inventories by fall, and auto stocks to normal on an historical basis (chart 9). This appeared normal for the remainder of the year,. caution, which can be traced back to the severe On balance, wholesale and retail trade accumuinventory cycle of 1974-75, appears to have lation continued about in line with sales for most been responsible for the avoidance of the types of 1978. of overhangs that have preceded several prior In the fourth quarter, inventories appeared to cyclical downturns. remain under close control. The significant Inventory accumulation was substantial in the overhangs that developed at general-merchanfirst quarter of 1978 following a moderate gain dise retail outlets in the fall were corrected at in the final quarter of 1977. The increase was least partially by the sharp rise in sales during noteworthy in view of the severe winter and the the holiday buying season and a slowing of coal strike, which cut production. In the second production of durable home goods. Toward the close of the year, inventories were generally lean to normal, suggesting little need for the 9. Ratio of total inventories to sales type of downward stock adjustment that can Ratio disrupt growth in employment and production. THE FEDERAL SECIOR Expansion in federal government expenditures slowed markedly in 1978, and the deficit for the calendar year narrowed to about $30 billion on a national income accounts (MIA) basis— roughly $17 billion less than in 1977, Tax 1974 ' ' 1976 ' ' 1978 receipts grew almost 15 percent, more than Based on Department of Commerce data in constant (1972) matching the brisk rate of increase in 1976 and dollars for alj manufacturing and trade establishments. Figure 1977 (chart 10). Personal tax receipts were for 1978 Q4 estimated by Federal Reserve. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12 The Economy in 1978 10. Federal receipts, expenditures, and deficit and localities rose briskly over 1978 in response to expanded local public works and public em- Billions of dollars ployment programs. However, the pace of such Expenditures 0 1 < ^^ federal--disbursements began to moderate late in the year with the expiration of countercyclical revenue sharing and the reduction in funding Receipts 300 for public service employment. Finally, interest 11 payments rose sharply over the year, following 1 1 i u a small gain in 1977. • ' L 1 1 J U u u u ^ ^ Deficit ^ 1 i t 100 STATE, AND LOC AL GO\ ERNMENIS 1974 1976 1978 Growth in spending by state and local govern- Department of Commerce NIA data. seasonall> adjusted at annual rates, ment units was moderate in 1978 (chart 11). For the third consecutive year this sector's revswelled by the growth in nominal incomes, enues exceeded expenditures, and the surplus, which put earners into higher tax brackets, In after deducting the share tor social insurance addition, a large increase in contributions for funds, amounted to $6 billion. Nevertheless, the social insurance reflected not only growing operational surplus was only half the amount payrolls but also previously legislated hikes in of the previous year, and by the fourth quarter the taxable wage base and in the tax rate. On the sector's budget had moved close to balance. an accrual basis, taxes on corporate profits rose This partly reflected the tendency for voter-inin line with other receipts, duced tax relief to outweigh spending economies. Real federal purchases—the component of total outlays that is directly included in GNP— Fiscal conservatism at both state and the local declined slightly more than I percent over the levels of government was one of the most four quarters ofM978, following a gain of 6 prominent political and economic issues of percent in the previous year. The reduction was 1978, sparked in part by California's Proposimost pronounced in the nondefense area, as net tion 13; which was passed in the early summer. loan repayments by farmers under the agricul- This measure put restrictions on property tax tural price support program of the Commodity collections in the current year and limited in- Credit Corporation more than offset increases creases for future years; it also erected formidaelsewhere in this category. (Commodity Credit ble barriers to other increases in taxes by local Corporation lending is treated as a federal pur- 11. State and local government activity chase on an NIA basts since the value of farm products in inventory, which are used as collat- Percentage change eral for the loans, is transferred from the farm, 4 to the government sector.; Similarly, loan repayments are negative federal purchases in the NIA.) Real defense spending, after a 3 percent rise in 1977, declined in 1978. The federal Billions of dollars government work force—civilian and mili- 40 tary—rose slightly last year, -the first- such increase in a decade. Among federal government expenditures not included in purchases, transfer payments to individuals showed only a moderate increase owing to a sizable $2Vi billion decline in unem- Department of Commerce data, seasonally adjusted at annual ployment compensation between 1977 and rales. Employment growth is Department of Labor data, seasonally adjusted at annual rates. Percentage changes are calcu- 1978. On the other hand, federal grants to states lated from Q4 to Q4. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

8 Federal Reserve Bulletin • January 1979 governments or by the state legislature. The 12. U.S. foreign transactions popular appeal of this initiative provided a basis Billions of dollars for action in other areas of the country, and Imports spending limitations or tax reduction measures ^^ 200 appeared on the ballots of 19 other states and Exports numerous localities in November. Although 160 voters generally opted for less severe methods of restraining expenditures, such actions imply 1120 a protracted period of relative conservatism in inn n 20 spending. ns"rpiuh n 1 Ifi n n „ + y yy n j u yi 0 Purchases of goods and services by states and Deficit |j H localities increased V/i percent in real terms 1 i i i 20 1974 1976 1978 over last year—about a percentage point below the rise in 1977. Boosted by federal local public Department of Commerce NIA data, seasonally adjusted at annual rates. works funding, construction outlays dramatically reversed their downward slide to increase economic growth. By year-end exports were 12 percent in real terms by year-end. The bulk about $7 billion less than imports, and condiof the new construction outlays went into water tions seemed favorable for further gains in 1979. facility projects of all types and into housing Contributing to the improvement of the external and urban redevelopment, educational build- position during the year was a pick-up in ecoings, and hospitals. nomic growth in the Group of Ten countries Employee compensation, which accounts for and Switzerland over the four quarters of 1978 more than half of state and local purchases, in contrast to more moderate expansion in the increased 9 percent in current dollars over the United States. year. The gain in employment was only about The gradual improvement of the U.S. trade one-half of the average in other recent years— balance did not prevent a substantial depreciaabout 200,000 jobs—despite the infusion of tion of the dollar with growing disorder in the federal funds under the Comprehensive Em- exchange markets. The trade-weighted average ployment and Training Act; that program paid value of the dollar fell about 20 percent from directly for 580,000 jobs, or about 5 percent September 1977 through the end of October of the total number of workers in the sector. 1978. Following the announcement of policy State and local government receipts rose to measures on November 1, the dollar increased $338 billion in the fourth quarter of 1978, a in value, but at year-end it was still 17 percent 10 percent increase over the previous year. The below its level in September 1977. While the rate of growth of own-source revenues (tax impact of this adjustment of exchange rates on receipts and nontax accruals) continually de- domestic inflation and activity has yet to run clined during the year, reflecting, in part, the its course, the efleets of the depreciation in pressure on elected officials to hold down tax increasing import prices tended to raise the 1978 rates, especially on property. Federal grants-in- nominal trade deficit. aid grew from $71 billion in 1977 to $79 billion U.S. nonagricultural merchandise exports in 1978. expanded rapidly in real terms after the first quarter of 1978. This increase followed essentially no growth in 1977 and while the expansion INTERNATIONAL TRADE was widespread, gains were particularly strong The deficit in net exports of goods and services for exports of machinery, industrial supplies, on an NIA basis was $12 billion in 1978, and aircraft. Agricultural exports, which acroughly the same as in the previous year (chart count for about a fifth of merchandise trade 12). The deficit narrowed during the year, how- shipments to other countries, grew rapidly in ever, and this provided additional support for 1978, rising 20 percent in constant dollars. This Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1978 9 strength coincided with unusually poor harvests 13, Later force, employment, and unemployment of wheat and soybeans in the Southern Hemi- Percent sphere and abundant harvests and stocks in this country. Higher prices helped to restrain imports, and in real terms, the growth in nonoil imports slowed substantially in 1978 compared with the previous two years,. The value-of nonpetroleum imports grew rapidly for the third successive year. In contrast to the 1976-77 period, higher prices accounted for an increased share of the rise in the total, import bill; by the fourth quarter Department of Labor data. Percentage changes are calculated of 1978 nonoil import prices were up 13 percent from Q4 to Q4. from a year earlier, more than half of the rise being due to the decline in the dollar's exchange fourth quarter, and by the end of the year, the value. increase in nonfarm payroll jobs from the pre- Unlike other imports, the price of imported ceding December totaled 3.5 million. petroleum was essentially unchanged during the Employment growth was particularly robust year, and increased production from Alaska and in the goods-producing sector, although there stock drawdowns more than matched the growth were substantial increases in other sectors as in domestic consumption. The result was a fall well. Manufacturing jobs rose about 740,000 in. oil imports amounting to about half'a million with strength concentrated in the durable goods barrels per day from levels in 1977. However, industries—especially machinery and transthe $2 billion decline in the oil import bill is portation equipment. Accompanying the sharp not likely to be matched in 11979- because the increases in nonresidential building activity and Organization of Petroleum Exporting Countries the high level of housing starts throughout the (OPEC) has announced a price increase of 1.4¥2 year was a rise in construction employment to percent spread over the year. Furthermore, a record level of 4.4 million. Continued growth Alaskan production has leveled off at about 1.2 in private service industries added 2 million jobs million barrels per day and will not match the in trade, finance, and services. needs of a further expansion in domestic de- Hiring gains during the first half of 1978 were mand. sufficient to reduce the unemployment rate to Net receipts of military and service transac- 6.0 percent by the •second quarter, 3/4 of a tions with nonresidents showed another strong percentage point below the level of late 1977. increase last year, reaching a level of about $23 The. jobless rate showed little further improvebillion. The bulk of the gain came from rising ment thereafter, however, and at year-end was income generated by U.S. direct investments 5.8 percent. Although reductions in unemployabroad and from net receipts of fees and royal- ment were shared by all demographic groups, ties from foreign affiliates. more than half of the decrease occurred among adult women; their unemployment rate fell 0.9 percentage point to 5.8 percent over the four THE LABOR. MARKET quarters of 1978, despite another sizable rise Over the year, total employment rose 4 percent, in the number of adult women in the labor force. nearly matching the exceptionally - strong ad- The -adult male labor force rose at about its vance in 1977 (chart 13). Despite the produc- long-term. trend rate and the unemployment rate tion disruptions of the first quarter, almost 214 for this group dropped 0.7 percentage point to million jobs were added to nonfarm payrolls by 4.0 percent,, Teenage unemployment, however, June. While gains slowed over the summer, remained very high and was above 16 percent rapid growth in employment resumed in the in the fourth quarter. In addition, unemployment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

10 Federal Reserve Bulletin • January 1979 among blacks and other minorities remained 14. Productivity and costs relatively severe, despite a drop of almost 2 change percentage points in their unemployment rate. 12 As opportunities for work increased during 1978, labor markets tightened noticeably. In 6 particular, unemployment rates for skilled and 0 experienced workers at year-end moved appreciably closer to their levels in 1973. In addition, long-term unemployment (27 weeks or more) fell from about 0.9 percent of the labor force at the beginning of the year to 0.5 percent at year-end. WAGES, PRODUCTIVITY, AND LABOR COSTS Department of Labor data, seasonally adjusted. 1978 Q4 Wages and fringe benefits grew more rapidly estimated by Federal Reserve. in 1978 than in 1976 and 1977. Measured by the hourly earnings index, wage rates in the ployer contributions for social insurance and the private nonfarm sector increased 8!4 percent costs of fringe benefits, rose 9lh percent during over the four quarters of last year compared with the year, about 1 lfi percentage points faster than about 7¥2 percent during each of the preceding the previous year (chart 14). About a third of two years. The substantial boost in the minimum this acceleration resulted directly from the inwage in January contributed to the 9 percent creases in payroll taxes in the first quarter. In increase in the trade sector, which has the larg- addition, private fringe benefits continued to est concentration of low-wage workers. In ad- increase faster than wages during 1978. dition, the tightening of labor markets bolstered Productivity showed little improvement in wage demands in construction after three years 1978. Output per hour in the nonfarm business of moderate increases. Wage gains in the man- sector was up slightly over the year, after having ufacturing industries amounted to 8V4 percent, risen only 1 ¥3 - percent in 1,977. Much of the about the same pace as in 1977, slowdown occurred outside the manufacturing There were relatively few new collective bar- sector; output per hour in manufacturing ingaining settlements last year. Most important creased at a rate of 3 percent during the year. were agreements negotiated in the coal and Normally, productivity growth slows as labor railroad industries, which provided for increases markets tighten and capacity constraints are similar to those negotiated by major unions in approached; but the fall-off in productivity gains 1977—more than 30 percent spread over the after the cyclical rebound earlier in the expanthree-year life of the contracts. Deferred in- sion has been particularly sharp in the past two creases and cost-of-living adjustments, how- years. ever, were more significant factors in union pay There seems to be no single reason for the in 1978. Over all, effective wage rate changes poor performance of U.S. productivity growth in collective bargaining agreements averaged 8 in recent years, although a number of factors percent—about the same as in 1977, The tight- appear to have played significant roles. The ening of labor markets, however, led to a nar- increase in labor force participation rates for rowing of wage differentials between the union women and youths has led to a more inexpeand nonunion sectors. Nonunion wage gains rienced work force on average. Added environincreased nearly 1V4 percentage points more mental and safety regulations have directed rethan in the 1976—77 period and about equaled sources to uses traditionally not measured as the rise in the union sector. output and have slowed certain types of techno- Hourly compensation, which includes em- logical advances. Furthermore, capital accumu- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Economy in 1978 11 Iation has been relatively deficient during this 1974—and contributed about 3/4 of a percentage economic expansion and has failed to keep pace point to the acceleration in consumer prices. The with the growth of the work force. increases at the retail level reflected a rise of Lagging productivity performance, together nearly; 20 percent in farm prices during 1978 with the acceleration in hourly compensation, following little change in the previous year. resulted in intensified cost pressures over the Most of the rise in food prices came early in year. Unit labor costs rose 9 percent during the year; meat price increases were particularly 1978, up substantially from the increase of 6V3 rapid as beef production continued to decline percent in 1977. Pressures on labor costs are from its cyclical peak in 1976. Price increases likely to remain intense in 1979 because of the for other food items, though smaller than those tight labor market, the large number of major for meats, were still quite large. collective bargaining agreements to be nego- Trends in energy prices were mixed in 1978 tiated, and the previously legislated increases and the rise at retail amounted to about 8 perin payroll taxes and the minimum wage. cent, somewhat above the increase in 1977. Natural gas prices continued to surge upward; over the past five years the annual rate of in- PRICES crease has averaged about 16 percent, reflecting In addition to the sizable increases in unit labor changes in regulatory policy and the impact of costs, special developments in the food, hous- increased prices for crude oil. Electricity rates ing, and international sectors contributed to a rose rapidly in the first half of 1978 due in part marked acceleration in the rate of inflation in to the higher costs associated with the coal 1978. Most broad measures of price change rose settlement. Gasoline prices were nearly stable about 2 percentage points more than in 1977 until midyear, when tight supplies led to a sharp (chart 15). Consumer prices were up 9 percent upturn. Further increases in gasoline prices are during 1978, as was the fixed-weight price index due in 1979, mainly because of higher OPEC for gross business product. Producer prices of crude oil prices. finished goods rose 9 percent also. Prices outside the food and energy areas rose Developments in the farm and food sector faster in 1978. Service prices excluding energy exerted a major influence on measures of infla- accelerated to an annual rate of 9¥i percent from tion in 1978. Retail food prices rose 12 percent 8 percent last year. The homeownership comover the year—the largest increase since ponent of the consumer price index was up 12lh percent, more than 3 percentage points above the previous year. This jump reflected strong 15. Prices demand pressures on house prices and rising Percentage change mortgage interest rates. With low vacancy rates and rising costs of fuel and other items, residential rents rose nearly llh percent in 1978, compared with about 6 percent in the two preceding years. Also, the increased minimum wage contributed to rising prices for a number of other service items. The decline in the dollar's exchange value also aggravated inflation. Aside from the direct effects of higher prices for imported merchandise, competitive pressures eased for a number of domestic products. Most noticeable were 1974 1976 1978 larger price increases for automobiles and other durable goods, Producer and consumer price indexes are Department ot Labor data, seasonally adjusted. The gross domestic business product fixed-weight At the producer level, finished goods prices index (1972 weights) is a Department of Commerce series, seasonally adjusted. Annual percentage changes are calculated from Q4 to Q4. of capital equipment showed considerably less Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

12 Federal Reserve Bulletin • January 1979 acceleration than those for consumer goods. But of economic activity. In addition, the adminiscrude materials prices, for both food and non- tration introduced a program of voluntary food items, were up sharply, and toward the wage-price guidelines designed to initiate a end of the year, prices for construction materials gradual unwinding of inflationary pressures. The were also rising rapidly. general price standard directs firms to limit their Because little relief is expected soon from the increases to 1/2 of a percentage point below pressures of labor costs, inflationary forces are their average annual rise during the 1976-77 likely to remain intense in 1979—especially in period. Wage increases are to be generally limview of the sharp increases in the price of oil ited to about 7 percent a year. The program also and the continued rise in food prices, in light sets an alternative profit-margin standard, proof such prospects, fiscal restraint and regulatory vides for public monitoring of certain price and reform have been recognized as essential, condi- wage increases, and includes a legislative protions for facilitating a less inflationary expansion posal for real-wage insurance. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

13 A Proposal for Redefining the Monetary Aggregates This BULLETIN article presents proposals by the institutions and commercial banks now provide staff of the Board of Governors for redefining the same transactions services as demand dethe monetary aggregates, They were formulated posits. In addition, preauthorization of bill payby a board staff group chaired by Stephen H. ments and telephone transfer services have sig- Axil rod, Staff Director for Monetary and Fi- nificantly increased the liquidity of savings denancial Policy. The proposals raise important posits at both commercial banks and thrift instiissues regarding the payments system, the tutions; and the automatic transfer from savings evolving role of depositary institutions, and the to demand-accounts (ATS), recently authorized, basis upon which the public chooses to hold has added substantially to the transacvarious financial assets. To aid in further con- tions-related character of savings deposits at sideration of these proposals, comments are commercial banks,1 invited from the public. Please address com- Other developments have reduced similarities ments to Office of the Staff Director for Mone- among various kinds of deposits, however. tary and Financial Policy, Board of Governors While savings balances at both commercial of the Federal Reserve System» Washington, banks and thrift institutions have become more D.C. 20551. liquid in recent years, time deposits have gen- Thomas D. Simpson, Senior Economist in the erally become less liquid. Penalties for early Banking Section of the Division of Research and withdrawal and the steady lengthening of ma- Statistics, had principal responsibility for the turities have reduced considerably the liquidity preparation of this article. Others making major of small-denomination time deposits. As a:concontributions to the formulation and analysis of sequence, the components of the M-2 and M-3 these proposals were Edward C. Ettin, John H. aggregates representing savings and small time Kalchbrenner, David E. Lindse\\ Richard D. deposits have become more dissimilar over Porter, Peter Tins ley, Darwin Beck, and Wil- time. Furthermore, a growing share of those liam Barnett. Research assistance was provided time deposits included in M-2—and in M-3—is by Daniel Rudolph and Juan Perea. in large time deposits with denominations of $100,000 or more. Chart 1 shows that large time Regulatory changes and financial innovations in deposits' currently make up a much larger recent years have fundamentally altered the proportion of M-2 than they did in the early character of the public's monetary assets. These 1970s. Moreover, such deposits have behaved developments are responsible for growing simi- much like a managed liability, and their movelarities among certain kinds of deposits, and, ments have tended to offset cyclical movements at the same time, for disappearing resemblances in savings and small time deposits, also shown among other kinds. Moreover, the distinctions between the deposit liabilities of commercial 1 Some thrift institutions—those with third-partypayment powers—are also permitted to oiler automatic banks and those of thrift institutions have betransfers. Moreover, the Federal Home Loan Bank come blurred. Board has recently proposed that federally chartered savings and loan associations be authorized to offer a With the authorization of .negotiable order of new kind of third-party-payment account—a payment withdrawal (NOW) accounts and credit union order account—on which funds could be withdrawn by share drafts, some savings balances at thrift nonnegotiable, nontransferable orders. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

14 Federal Reserve Bulletin • January 1979 1. Principal components of M-2 pace of regulatory and financial innovation, further redefinitions might well be needed as the Percent character of the public's monetary assets continues to change. The most important financial developments affecting the monetary aggregates in recent years are discussed in the next section. This is followed by a presentation of the proposed measures of the monetary aggregates. The next two sections discuss the empirical relationships among the proposed aggregates and other important economic variables, and the Federal Quarterly averages, seasonally adjusted. Reserve's ability to control the various monetary aggregates. Important consolidation issues arise in the chart. Over the cycle, large time deposits in the construction of measures of the public's included in M-2 have varied in much the same monetary assets and some of these are discussed way as large negotiable time deposits (negotia- next. The last section contains a brief discussion ble certificates of deposit) at large banks, which of the timeliness of the data and data requireare excluded from the current M-2 and M-3 ments. The appendix describes in some detail measures. the procedures used in constructing the proposed Commercial banks in recent years have also monetary aggregates and the basic data sources. come to rely more heavily on some nondeposit liabilities, particularly security repurchase agreements (RPs).2 From the standpoint of the RECENT DEVELOPMENTS AFFECTING customer, RPs are a relatively safe and liquid THE PUBLIC'S MONETARY ASSETS alternative to holding deposits with commercial Since 1970 a large number of regulatory banks and other depositary institutions. changes and other financial developments' have Because of these developments, the meaning affected the nature of the public's monetary of measures of the monetary aggregates has assets. The most significant of these are listed been changing, and a revision in existing defiin table 1. With the authorization of NOW nitions appears needed. The definitions proaccounts (line 2), credit union share drafts (line posed by the board stall in this article reflect 6), and demand deposits at thrift institutions recent developments by grouping together simi- (line 9), new accounts subject to withdrawal by lar kinds of deposits at all depositary institudraft or check have appeared. NOW balances tions. While the proposals seek to bring the at commercial banks had grown to about $2 monetary aggregates up to date, no one aggrebillion by June 1978, while NOW accounts at gate or group of aggregates can satisfy all purthrift institutions had grown to over $1 billion poses and, at times, it is necessary to deal with (table 2, last column). Balances in share draft their principal components, which would be accounts at credit unions (the third item in table published separately.3 Moreover, in view of the 2), plus demand deposits at thrift institutions (the fourth item) equaled almost billion, 2 A security repurchase agreement is an arrangement or about one-half of total NOW balances at that whereby a bank "sells" a security in its portfolio— time. usually a treasury or federal agency security—to a customer and agrees to repurchase it at a specified price Preauthorized transfers from savings accounts at some future date. at commercial banks (table 1, line 1), govern- 3 In addition to the principal components of the ment and business savings accounts (line 7), proposed monetary aggregates, other pertinent deposit categories, such as U.S. Treasury deposits, interbank telephone transfers (line 8), and, most recently, deposits, and deposits of foreign commercial banks and automatic transfer services (ATS, line 1 1) have official institutions, would be published. Estimates of substantially enhanced the liquidity and transcommercial bank repurchase agreements with the nonbank public would also be published. actions character of commercial bank savings Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 15 1. Selected developments affecting the nature of the monetary aggregates Monetary aggregate containing Development Date Deposit liability' deposit liability 1... Preauthorized transfers * 9/70. 4/75, SSaavviinnggss hhaallaanncceess aatt SS&&LLss aanndd ccoommmmeerrcciiaall bbaannkkss M-2. M-3 9/75 2. NOW accountslb 6/72, 9/72, Savings balances at MSBs, S&Ls, and commercial M-2, M-3' 1/74, 2/76, banks 11/78 3. d 2 e '/ p 2 o v s e it a s r * , 1 4 vear, 6 vear, and 8 vear time 12 1 / / 7 7 4 0 , , , 6 7 / / 7 7 8 3 b T a im nk e s deposits at MSBs, S&Ls, and commercial M-2, M-3 4. Substantial penalty on early withdrawal of time Time deposits at commercial banks, S&Ls, and M-2, M-3 deposits 7/73 MSBs 5. Point-of-sale terminals (POS) permitting remote withdrawals of deposits from savings 1/74 Savings balances at S&Ls M-3 6. Credit union share drafts' 10/74, 3/78 Regular share accounts at federal credit' unions M-3 7. Savings accounts fiom domestic governments and businesses 1 1 1/74, 11/75 Savings balances at commercial banks M-2, M-3 8. Telephone- transfers- 4/75 Savings balances at commercial banksK M-2, M-3 9. Demand deposits at thrills1' 5/76 Deposits of MSBs and S&Ls M-3 10. 6-month monev market certificates 6/78 Time deposits at S&Ls, MSBs, and commercial M-2, M-3 banks 1 1.A utomatic transfer services (ATS). 111/78 Savings balances at commercial banks and thrifts M-2, M-3 • having transactions balances 12. Payment order account (POA) Proposed 11/78 Savings balances- at 'S-&Ls" M-3 • Savings and loans were permitted to make preauthori/ed nonnego- time deposit was approved in Jul) 1973, the increase on the six-year liable transfers from savings accounts for household-related expenditures deposit in December 1974, and the increase on the eight-year time in September 1970 and third-party nonnegottable transfers from savings deposit in June '1978. in April 1975, Commercial hanks were authorized to make preauthorized '' Temporary experimental share draft programs were first approved third partv nonnegotiable transfers from savings in September 1975. tor tederal credit unions in October 1974, final regulations for permanent 1,1 State-chartered mutual savings banks began tillering NOWs in programs became effective In 'March 1.9*78, 'Massachusetts in June--1972.and in New Hampshire in September 1972 f Savings accounts for domestic government units were permitted In January 1974. depositary Institutions 'in Massachusetts .and New in November 1974, and for businesses (up to $150,000 per account Hampshire were authorized to'offer NOWs, In-. March. 1976, NOWs per eiMtonner) In November 1975. were authorized at depositarv institutions in Connecticut. Maine, Rhode K Telephone transfers from savings balances at thrift institutions have Island, and Vermont; in November 1978, NOWs were authorized in been allowed since the 1960s New York State. 1 State-chartered mutual savings banks and savings and loans in New *" NOWs at commercial banks appear in M-2 (and M-3), while NO'W's York State were authorized to otter demand deposits in May 1976. a thrift institutions appear' in M-3. Prior to this time, these institutions were permitted to otter payment sl The increase in interest rate ceilings on the two-and-one-halt >ear orders of withdrawal (POW) deposits In addition, thrift institutions deposit was approved in January 1970. the increase on the four-year in some-other states-have been permitted to otter non-interest-earning transactions balances to households. balances. Telephone transfers and ATS permit sharply just after being introduced but more savings balances to be shifted readily into de- recently have leveled off (business accounts) or mand accounts, while preauthorized transfers declined (government accounts) in response to permit direct payments from customers" savings. increases in market rates of interest. In late The authorization of savings accounts for busi- 1978; such balances amounted to about $15 nesses and domestic governments gives these billion, depositors a highly liquid interest-earning alter- Evidence on debits to savings accounts, native to holding funds in demand accounts. available since July 1977, indicates that activity Funds in domestic government and business in these accounts has increased recently. As savings accounts (shown in table 2) grew shown below, turnover rates, defined as the 2. Selected deposit balances at commercial banks and thrift institutions Millions of dollars, not seasonally adjusted June June June June June Type of deposit balance 1974 1975 1976 1977 1978 NOW accounts At commercial banks 13 211 804 1.501 2,080 At thrift institutions 178 3 69 61 1 875 11,,118811 Share draft balances at c redit unions ,, „..,,,,,,,,,................,., 3 61 234 576 Demand deposits at thrift institutions ,/, , 166 314 594 864 Savings at commercial banks • . By domestic governments 336 3,440 6,282 4,878 By businesses ......,...,',..,.... 6,013 10.123 10.757 Small denomination time deposits with maturities over four years At commercial banks * , 21,027 35,956 49,890 66,151 74.396 At thrift institutions b ' ..... 40,600 82,100 117,500 158,400 196,800 m Measured as of July'of each year.' b 1 stimated as ot March of each vear lor savings and loans and April of each veur for mutual savings banks Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

16 Federal Reserve Bulletin • January 1979 annual dollar volume of debits divided by 2. Long-term, small-denomination time deposits average balances, have risen since the summer :ent of 1977. (These data do not include NOW All depositary institutions accounts,) Turnover rates for business savings Percent of interest-earning component of M-3 Debits to savings deposits (billions of dollars Savings deposit turnover at annual rates) (annual rates) Month Business Other Business Other Commercial banks J 1 u 9 l 7 y 7 40.8 307.8 4.0 15 c P o e m rc p e o n n t e o n f t i o n f te M re - s 2 t- earning October ... 41.9 3)3.2 4.0 1.5 December 49.11 304.9 4.6 1.5 1978 March . , 48.3 333.5 4.6 1.6 July 55.6 376.5 5.1 1.8 October ,,, 67.2 394.2 5.8 1.9 Original maturities of four years or longer. Commercial bank data are quarterly ; observations for other depositary institutions are for March and September. Long term time deposits at accounts advanced 45 percent from July 1977 mutual savings banks and savings and loans have been estimated; those at credit unions, believed to be very small, are to October 1978, while turnover rates for other excluded. savings accounts—mainly those of individuals and to a lesser degree domestic govern- In contrast to these developments, the inments—rose about 25 percent.4 To some extent, crease in regulatory ceiling rates on four-, six-, this increase in turnover rates might reflect and eight-year time deposits (line 3), which higher market rates of interest, as some savings enabled depositary institutions to issue longercustomers likely shifted their investment term time deposits, has led to a significant funds—relatively idle balances—to market in- reduction in the liquidity of time deposits by struments with higher yields. Nevertheless, lengthening maturities at commercial banks, savings balances of both businesses and others mutuals, and savings and loans. As chart 2 did expand between these dates, when turnover shows, from the early 1970s to mid-1978, comrates were rising, suggesting that any outflows mercial bank time deposits with maturities of of investment funds from savings were more four years or more advanced from less than 1 than offset by inflows of more transac- percent of total time and savings deposits intions-related funds. cluded in M-2 to 15 percent; even more striking Similarly, preauthorized and telephone has been the trend in longer-term time deposits transfers have enabled customers of thrift insti- included in M-3, also shown in the chart, which tutions to use their savings more effectively for jumped from modest proportions in 1973 to an transactions purposes. In addition, point-of-sale estimated 25 percent of total time and savings terminals (POS, table 1, line 5) have gone a deposits included in this aggregate by the spring step further by allowing these customers to of 1978. Dollar amounts of longer-term time make withdrawals and deposits from savings by deposits at commercial banks and at savings and using remote terminals placed at retailers. Most loans and mutual savings banks are given in the recently, the Federal Home Loan Bank Board last two rows of table 2. In mid-1978, such has proposed that federally chartered savings deposits accounted for about 45 percent of and loan associations be permitted to offer a new small-denomination time balances at commer- ''payment order account" (POA, line 12), cial banks and about 70 percent of small time which could be used for making third-party balances at savings and loans and mutual savpayments.5 ings banks. The substantial penalty on early withdrawals of time deposits imposed in July 1973 has further reduced the liquidity of time 4 These turnover rates for savings deposits, however, deposits included in M-2 and M-3." are considerably smaller than turnover rates for demand deposits, which are about 100 per year for banks located outside New York City. 5 The ceiling rate on POA accounts would, according to the proposal, be 5 percent, the same as that for all 6 The depositor is required to forgo interest for 90 NOW accounts and ATS savings. The ceiling rate on days and earns the passbook rate for the remaining time share draft accounts at credit unions is 7 percent. that the funds have been placed with the institution. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 17 The introduction in June 1978 of the six- new measures are designed to replace the curmonth variable-ceiling money market certificate rent monetary aggregates, M-l through M-5, (table 1, line 10) has tended to offset the trend shown In table 4. Proposed M-1, by including toward longer average maturities of time depos- new transactions accounts and by excluding its, This new deposit has attracted a sizable selected foreign deposits, is a more comprehenvolume of funds at both commercial;banks and sive measure of transactions balances held for thrift institutions in just a few months, By late domestic expenditures than current M-l. The December, seven months after the introduction next measure, M-1 +, adds to M-l all savings of money market certificates, such deposits at balances at commercial banks, which have becommercial banks had expanded to 4Vz percent come more transactions-related in recent years. of total time and savings deposits included in Next, savings balances at thrift institutions, M-2; at both commercial banks and thrift insti- which have also become more liquid in recent tutions these certificates had risen by late De- years, are added to M-l + in deriving proposed cember to about 6% percent of total time, and M-2. The fourth and broadest measure of the savings deposits included in M-3. public's monetary assets, proposed M-3, adds In addition to these developments, in the past to proposed M-2 time deposits at all depositary decade the public began to use cash manage- institutions, and has been designed to include ment techniques more intensively. With the all the deposit liabilities to the public of deposiapplication of such techniques as lock boxes, tary institutions. wire transfers, information-retrieval systems, and cash-concentration accounts, the public— 3. Proposed monetary aggregates particularly businesses—has been able to make Dollar amounts in billions ot dollars, not seasonal!} adjusted transactions using relatively smaller amounts of demand deposits. In extensive interviews with Proposed Amount» aggregate Components June 1978 board staff, cash managers and commercial 1. M-l Current M-l 351.7 bankers indicated that their reliance on cash Pi 1 s: NOW balances 3,3* Credit union share drafts .6 management intensified around the mid-1970s. D A e T m S an s d a vi d n e g p s o sits at thrifts . , 9 ||i ». Much of the funds "released" from demand LESS: Demand deposits of foreign commercial banks and official deposits was used to acquire highly liquid inter- institutions 11.3 Total4" 345,0 est-earning investments, such as repurchase 2. M-1+ Proposed M-1 .345,0 agreements, commercial paper, and treasury PLUS: Savings balances at commercial banks*1 221.6 bills,7 Total 566.6 3. M~2 Proposed M-l. 345,0 Pi i s: Savings balances at all deposi- PROPOSED MONETARY AGGREGATES tar T y o i t n al s titutions* 4 8 9 4 . 0 5 . . 3 3 The four monetary aggregates being proposed 4. M-3 Proposed M-l 345,(1 PLUS: All time and savings deposits by the board staff are presented in fable 3, The (including large time deposits) at all depositors institutions' 1,154,6 Total 1,499,7 7 In a recent econometric study of money .demand, " Consists of NOW balances in New England stales In Novembei 1978, NOW accounts were authorized in New York State and by January Tinslcy, Garrett, and Friar conclude that the bulk of 10, 1979, the stock of. MOW balances at depositary institutions in New the shortfall in the public's demand for deposits during Voik is estimated to' have been $0.6 billion. this period was mirrored by acquisitions of _ transac- 11 Would also include pawnent order accounts (POA) at sa\mgs and loans, it the current federal Home Loan Bank Hoard proposal is tions-related RPs, See P. A. Tinsley, B. Garrett, with adopted. ATS savings were first offered on November 1, 1978, and M, E, Friar s " The Measurement of Money Wpand" by January I©» estimated ATS balances were $4 billion, (Board, of Governors of the Federal. Reserve System, " To-tul dues itot equal the sum of the components because ot other Division of Research and Statistics, Special Studies miscellaneous adjustments to.the total (see the appendix,). 1-1 Excludes NOW and. ATS savings balances at commercial banks. Section, November 1978; processed), An' alternative ® Hxeludes all NOW. A I S. POA (it introduced). and credit union interpretation of this period—one emphasizing the con- share draft balances. tribution of cash management services to reducing • the variance of depositors' cash flow positions—can be Two questions were asked in designing the found in Richard D. Porter and Eileen Mauskopf, ."'Cash Management and the Recent Shift in the Demand for proposed measures. First, do the assets included Demand Deposits" (Board of Governors of the Federal serve as a transactions balance or a medium of Reserve System, Division of Research and Statistics. exchange? Are they, that is, generally accepted Econometric and Computer Applications Section, October 1978; processed). in exchange for goods, services, and other Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

18 Federal Reserve Bulletin • January 1979 4, Current monetary aggregates is data availability. For example, it can be Dollar amounts in billions. not seasonally adjusted argued that even though time deposits have generally become more illiquid over time, there Current • Amount, aggregate Components June 1978 are sizable amounts of short-term time deposits i. M-I Currency 92.9 and they should be included with savings de- PLUS; Demand deposits at commercial banks 258.8 posits in a measure of the money supply.8 The Total 351,7 problem with including time deposits is that data 2. M-2 M-1 351. .7 PLUS; Savings balances at commer- on remaining maturities are generally not availcial banks 223.8 Time deposits at commercial able, and data on the original maturities of time banks 352,8 LESS I Negotiable CDs at large banks 86 3 deposits for some institutions, principally mem- Total 842.0 ber banks, are available only for recent years,9 3, M-3 M-2 842,0 PLUS: Savings balances at thrift insti The issue of data availability is discussed below tuitions 275.8 lime deposits at thrift institu- and in the appendix. tions 317,4 Total 1,435.2 Another consideration in selecting measures 4, M-4 M-2 842.0 of the monetary aggregates is their empirical PLUS: Negotiable CDs at large banks 86.3 Total 928.3 relation to other economic variables, particu- 5, M-5 M-3 11,435.2 larly the gross national product. Normally, a PLUS: Negotiable CDs at large banks m,3 Total 1,521.5 measure of money would be more desirable the closer its past relationship to GNP and other economic variables. By fundamentally altering assets? Traditionally, currency and demand de- the nature of the public's monetary assets, posits at commercial banks—which make up however, recent financial developments. have current M-1—have been viewed as satisfying diminished the usefulness of statistical relationthis condition. More recently, as noted earlier, ships based on longer-term experience as guides other kinds of deposits, some of which are at to selecting aggregates. Indeed, in large part It other kinds of institutions, have come to meet is because of these developments that new this criterion. Thus, in defining the proposed measures of the monetary aggregates are being M-1 measure, transactions balances of various proposed. Empirical evidence on this issue- is kinds have been aggregated across depositary presented below. Finally, the ability of-the Fed-institutions. eral Reserve to control an aggregate is another Second, is the asset readily convertible into important consideration in making a selection. a transactions balance? Does the public view This issue, too, is discussed later. it, that is, as a highly liquid alternative to The remainder of this section examines each transactions balances? Many believe that those of the proposed monetary aggregates in some assets that the public considers close substitutes detail. for transactions balances should be included in broader measures of the monetary aggregates. 8 While short-term time deposits tend-to be liquid The definition of the current M-2 embodies this in the sense that the date of maturity is near, with current criterion by including savings and small time interest penalties such deposits tend to become less liquid as they approach maturity in the sense that the deposits at commercial banks along with coneffective >ield declines more the closer withdrawal Is ventional transactions media. This second crite- to maturity. rion also implies limits to aggregation. Assets 9 Timely data on the original maturity of member bank time deposits for three maturity categories—'under that are not viewed as close substitutes for media six months, "six months to four years, and over four of exchange would be excluded from the mone- >ears—have been available weekly since late 1974."Less tary aggregates. In applying this criterion to the timely breakdowns by maturity-—-estimated for all commercial banks—are available as of the end of each broader measures of the monetary aggregates, quarter, beginning in 1968; however, maturity breaksimilar kinds of deposits at all depositary insti- downs have changed occasionally during this period In tutions have been combined. connection with actions allecting regulatory ceilings on different maturities of time deposits. Indirect data for Other considerations have intluenced the desavings and loans and mutual savings banks are availsign of the proposed monetary aggregates. One able semi-annually, beginning in 1973, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 19 Proposed M-l 4. Rates of growth of current and proposed M-l Percent The proposed M-l (line 1 of table 3) differs from the current M-l in that it includes mew transactions-related savings deposits at commercial banks and thrift institutions-—-such as NOW balances, ATS balances, share draft balances at credit unions, and demand deposits at thrift institutions—while it excludes demand' deposits of foreign commercial banks and official institutions,10 The Advisory Committee on Monetary Statistics (the Bach Committee) recommended this exclusion because such balances Seasonally adjusted at annual rates, are held primarily as clearing balances for inbe expected to be closely related to domestic ternational transactions and international retransactions. serves,11 Thus, compared with the present M-l, As chart 3 reveals, proposed M-l is somethe proposed M-l is a more comprehensive what smaller than current M-l, since the measure of balances of domestically related foreign-related demand deposits removed have transactions.12 Proposed M-l satisfies the meexceeded the new transactions balances added. dium-of-exchange criterion, which calls for a However, rates of growth (shown in chart 4) narrow measure of money to represent fundsare very similar for the two measures. available for immediate payment for goods, The public's demands for these measures of services, and other assets. Such a measure can money relative to GNP move inversely with their velocities (chart 5). The velocities for 10 If the Federal Home Loan Bank Board. prqposal current and proposed M-l move in close paralto create a new payment order account (POA) is lel. While the demands for both current and adopted, these balances would be included in proposed proposed M-I relative to GNP appear to have M-1. 11 See Improving the Monetary Aggregate.s: Report decreased around 1975—at a time when market of the Advisory Committee on Monetary Statistics rates of interest were generally declining- (Board of Governors of the Federal Reserve- System, econometric evidence indicates a slightly less June 1976), p. 4. See also Helen T. Parr, Lance V. Girton, Henry 5, Terrell, and Thomas H, Turner pronounced decline for proposed M-l.13 f "Foreign Demand Deposits at Commercial Banks in the Although the more comprehensive measure United States," in Improving the Monetary Aggregates: Staff Papers (Board of Governors of the Federal Reserve of transactions balances, proposed M-l, has System, November 1978). pp. 35-54, behaved much like present M-l, new develop- 12 Some transactions balance.®—-such as traveler*s ments are likely to cause the two to diverge. checks and money market mutual funds—are excluded With ATS accounts growing in popularity, from proposed M-l, primarily because data are unavailable. funds can be expected to shift from consumer demand balances to ATS savings, thereby de- 3. Current and proposed M-l pressing current M-1 relative to total spending.14 13 In simulations of money demand and reduced-form equations for both M-l measures over the period from, mid-1974 to mid-1978, presented below, simulation errors were marginally smaller for proposed M-l than for current M-l*. 14 While shifts of funds from consumer demand deposits to ATS savings (and POA savings, if offered) will not aflect proposed M-l, shifts of funds from other sources to ATS savings will cause this aggregate to rise relative to total spending. A.break in the M-l series can be expected regardless of whether ATS savings are included. If fcbey are excluded, M-l can be expected to decline relative to spending; if they are included, Quarterly averages, seasonally adjusted. M-l .can be expected to increase. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

20 Federal Reserve Bulletin • January 1979 5. Velocities of current and proposed M-i in recent years have significantly enhanced the Velocity liquidity of commercial bank savings accounts and have increased the similarities between such t ' - ^ balances and demand deposits, Important among these developments have been the authorization of business and domestic govern- ^^z^iDurrent ment savings and preauthorized and telephone j- , - • transfers, in addition to ATS and NOW accounts 44 for individuals. The aggregation of savings at commercial banks and M-l into a new measure i i ii ! 1 ! 1 1 ii ii ii ii ii ii tt tt ii ii ii 1960 1965 1970 1975 '78 of money was a possibility suggested for consideration by the Advisory Committee on Mon- Seasonally adjusted. etary Statistics.17 Moreover, some empirical In addition, should the Congress and the various evidence, based on the period before ATS, regulatory authorities continue to expand the suggests that savings balances at commercial opportunities of commercial banks and thrift banks have had a higher degree of liquidity, or institutions to offer new transactions accounts, "moneyness," than those at other institutions.18 further conversions from consumer demand de- Depending on the direction of developments, posits will reinforce the importance of broaden- the proposed M-1+ aggregate may serve ing the coverage of M-l. principally as a transitional measure. The importance of M-1+ as a narrower monetary ag- Since NOW accounts, ATS savings accounts, gregate is tied very closely to the emerging role and share draft accounts at credit unions can of automatic transfers. During the transition, serve as both transactions balances and more when conversions to ATS savings are occurring, permanent interest-earning savings balances, the relationships between M-1 + on the one hand consumers are likely to hold larger amounts of and GNP and interest rates on the other should funds in these kinds of accounts than they would resemble the historical pattern more than can otherwise have held in demand deposits, and growth in proposed M-l relative to GNP may be more rapid than historical growth of current 17 improving the Monetary Aggregates: Report, p. M-l. Also, since the interest-earning savings 11. 18 William A. Barnett, ""'A Fully Nested System of component of these new accounts is likely to Monetary Quantity and Dual - User Cost Price Aggrebe sensitive to spreads between market rates of gates/9 Board of Governors of the Federal Reserve interest and regulatory ceilings, proposed M-l System, Division of Research and Statistics, Economemay be more sensitive to changes in market tric and Computer Applications Section, November 1978; processed). In this paper, the author constructs interest rates than current M-l.15 an ideal index under aggregation-—which might be interpreted as a measure of "moneyness**—-based on recent advances in the theory of index numbers and on M-1 + newly developed econometric methods. The evidence suggests that a. dollar's worth of savings balances at The second proposed monetary aggregate shown commercial banks makes a larger contribution to the in table 3 (line 2) is M-1 + , which consists of "liquidity" of consumers' monetary assets than a dollar's worth of savings balances at thrift institutions, proposed M-l plus savings balances at comperhaps because of the convenience of having savings mercial banks.16 As noted earlier, developments balances at the same location where one conducts other business. Nevertheless, the author also finds a very high 15 Econometric evidence indicates that the demand degree of substitutability between savings deposits at for interest-earning savings balances is more responsive commercial banks and savings at thrift institutions. to changes in both income and interest rates than is When similar methods are applied to the measurement the demand for demand deposits, and thus the demand of substitutability between savings deposits and transfor proposed M-l, by including savings-related funds, actions balances, it is discovered that savings deposits might be more income elastic and interest elastic than and transactions balances are not viewed b> the public the demand for current M-l. as being as substitutable tor each other as savings 16 The M-1+ measure described in this section deposits at commercial banks and savings deposits at differs from the one currently published basically by thrift institutions. See also W. E. Diewert, "Exact and excluding demand deposits of foreign commercial banks Superlative Index Numbers," Journal of Econometrics, and official institutions. vol. 4 (May 1976), pp. 115-45. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 21 be expected for either current or proposed M-L 7. Velocities of proposed M-l and M4+ Although conversions from consumer demand Velocity balances to ATS savings will not disturb proposed M-l, shifts from ordinary savings balances to ATS savings will result in an expansion of proposed M-l relative to GNP. Consequently, since shifts from ordinary savings to ATS savings would not affect the proposed M-l + during the transition, M-1 + may serveas a useful supplement to proposed M-l for interpreting underlying growth in the public's demands for transactions balances.19 Seasonally adjusted. Since savings balances are more sensitive than demand deposits to interest rates—particuin the early 1960s, 1971-72, and 1976-77— larly to the difference between the rate paid by growth in M-1+ was faster than growth in commercial banks and short-term market proposed M-l. Conversely, when market rates rates—growth in M-I+ varies more over the rose substantially above ceiling rates—as in course of the interest rate cycle than does growth 1966, 1969-70, and 1973—growth in M-1 + in M-l. This difference can be seen in chart was slow relative to that of proposed M-l. 6, which depicts the annualized rates of growth Because movements in market interest rates of proposed M-l and M-1+ in the upper panel have a discernible influence on M-1 + , the veand the spread between the 90-day treasury bill locity of that aggregate—shown in chart 7— rate and the ceiling rate on commercial bank tends to vary directly with the interest rate cycle. passbooks in the lower panel. When market The velocity of M-1+ has tended to increase yields were low relative to the ceiling rate—as over time—along with the general level of interest rates—as has the velocity of proposed 19 Shifts of funds to ATS savings from sources other than demand deposits and ordinary savings deposits will M-l, also shown in the chart. In'the period tend to disturb the relationships among M-I + , .GNP, encompassing 1975 and 1976, however, the and interest rates, Available evidence indicates, howvelocities of M-1+ and M-l were somewhat ever, that shifts of funds to ATS savings from these other sources have been relatively small. disparate, with the M-l velocity rising If POA accounts are authorized for savings and loan sharply—at a time when market rates were associations and if these accounts become popular, the generally declining—while the M-1+ velocity usefulness of M-l f as a supplemental aggregate will diminish. In this event, more attention could be given was relatively steady. It appears that the to proposed M-2. expanding use of cash management techniques was largely responsible for the paring of transactions balances relative to GNP—particularly 6. Rates of growth of proposed M-l and M-1 + by large businesses—and for the corresponding Percent jump in M-1 velocity;20 by contrast, relatively low market rates of interest at this time evidently swelled savings balances at commercial banks, thereby offsetting a similar rise in M-l + velocity. 20 See Jared Enzler, Lewis Johnson, and John Paulus, Yield spread * * Some Problems of Money Demand," Brookings Papers-on Economic Activity, 1:1976, pp. 261—80; Perry D. Quick and John Pawlus, "Financial Innovations and the Transactions Demand for Money" (Board of Governors of the Federal Reserve System, Division of Research and. Statistics, Banking Section, February 1977; processed); Porter and Mauskopf, "Cash Management;" and Tinsle> and others. "Measurement of Money Demand. * * Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

22 Federal Reserve Bulletin • January 1979 M-2 9. Velocities of proposed M-2 and M-1 + Velocity Proposed M-2, shown in table 3, adds savings deposits at all depositary institutions to proposed M-L In other words, similar deposits—savings balances—are combined across depositary institutions to obtain proposed M-2; to obtain current M-2 dissimilar deposits—savings and time deposits—at commercial banks are summed.21 A comparison of tables 3 and 4 indicates that proposed M-2 and current M-2 are of comparable size. Quarterly, seasonally adjusted. institutions can be linearly combined in a monetary aggregate.22 The combination of all sav- 8. Rates of grow th of proposed M-2 and M -1 + ings balances with M-1 was also a possibility Percent suggested for consideration by the Advisory Committee on Monetary Statistics.23 12 k . / \ / y \ As might be expected, the behavior of pror-A A a1+ A posed M-2 is very similar to that of M-1 +. Chart 8 shows this relation in the upper panel and also contains the spread between the treas- I i i i i i i i i i i i1 ! 1 I I I) ury bill rate and the ceiling rate on commercial Yield spread bank passbooks in the lower panel. Growth in Treasury bill rate less /\ both measures tends to be sensitive to movepassbook ceiling^rate^/ \ Z\JL ments in the rate spread. The velocities of proposed M-2 and M-1+—presented in chart I I I I i I I i i i i i i i i i i i 9—have both trended upward over time and. 1960 1965 1970 1975 78 have had synchronous movements over the in- Seasonally adjusted. terest rate cycle. The discussion in an. earlier section noted that many developments that have increased the li- M-3 quidity of savings deposits at commercial banks Proposed M-3 consists of proposed M-2 along have also enhanced the liquidity of savings with all time deposits of all depositary institudeposits at thrift institutions. Because of these tions, regardless of denomination, maturity, or developments, the interest-earning savings bal- negotiability. Once again, similar deposits—in ances of the public can now perform many of this instance, time deposits—have been aggrethe functions previously reserved for demand gated across depositary institutions. Table 3 deposits. Some empirical evidence suggests that, while the public may consider savings at 22 Harnett, "A Fully 'Nested System of Monetary commercial banks to be more liquid than sav- Quantity," concludes that, in such an aggregate, savings at thrift institutions, a relatively hig h degree ings deposits at commercial banks would .receive - a higher weight than savings at thrift institutions. Indeed, of substitutability exists between the two kinds the weight attached to a dollar's worth of savings at of savings, and that savings at all depositary commercial banks would be roughly twice as large as the weight on a dollar's worth of savings at'thrifts,. Nevertheless, such a weighted series produces -growth 21 Savings are distinct from time deposits on liquidity rates that ha\e 'been very, similar to a scries that simply grounds. In practice, funds in savings accounts are adds savings at commercial banks to savings at thrift 'usually available immediately while funds in time de- institutions, posit accounts are available with a delay or are subject 2:5 Improving the Monetary Aggregates: Report, p. to a substantial early-withdrawal penalty. 1 1. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 23 shows that proposed M-3 is considerably larger 10. Rates of growth of proposed M-2 and M-3 than proposed M-2 and also larger than current Percent M-3, shown in table 4. M-3 is in effect a broad monetary aggregate that includes all liabilities of depositary institutions to the public. In principle, nondeposit liabilities of these institutions would be included along with their deposit liabilities. Among the most important nondeposit liabilities are secu- Yield spread rity repurchase agreements (RPs).24 As noted Treasury bill rate less /V earlier, RP liabilities have become more impor- Ap assboo,k —ceiling aratae,^ / \ yy / \ . $ tant in recent years and tend to be viewed by the public as highly liquid alternatives to deposits. In practice, however, current data limitations militate against their inclusion in proposed M-3. The board's stall has constructed Seasonally adjusted. an RP series using available information, and it would be published separately; but the esti- Chart 10 shows that rates of growth of promates are inferior to those for other components posed M-3 tend to be higher and generally of the monetary aggregates.25 Once more com- steadier than those of proposed M-2. This relaplete data are collected, RPs could be added tive stability reflects largely the actions of deto M-3 or perhaps to a narrower measure of positary institutions, mainly commercial banks, money, if that is suggested by subsequent re- to offset over the course of the interest rate cycle search.2" changes in inflows of savings and small time deposits—subject to interest rate ceilings— 24 '.Depositary institutions also attract nondeposit through the issuance of large time deposits that funds from other sources." However., much of the funds are free of such ceilings. When inflows of small from sueh sources comes trom other depositary institutions, domestic and foreign, and hence would be re- time and savings deposits weaken because marmoved either by consolidation or by procedures that ket rates rise considerably above regulatory exclude those liabilities due to foreign banking offices. ceilings, these institutions tend to step up the For example, commercial banks attract a sizable amount of federal funds from sources other than commercial issuance of large time deposits; conversely, banks, but the bulk comes from other depositary insti- when inflows of other deposits strengthen, relitutions—savings and loans and mutual savings banks. ance on these managed liabilities is reduced. As Also, commercial banks attract nondeposit funds in the form of Eurodollars, which are obtained from banking a result, growth in this broader aggregate tends offices abroad. to be less variable than growth in aggregates 25 RP data are collected 'by the Reserve Banks on a regular basis from a sample of approximately 46 large banks that are estimated currently to have roughly 60 percent of all commercial bank RP liabilities to the 11. Velocities of proposed M-2 and M-3 nonbank public. However, unlike the data on commercial bank deposits that appear in the monetary aggre- Velocity gates, universe call report data are not available for RPs; commercial bank RPs with the nonbank public have not appeared as a separate item on the call report and indirect methods, subject to considerable error, must be used to estimate the universe. As a result, given the size and variability of commercial bank RPs, the dollar magnitude of estimation errors in the series'for all commercial banks'is'-probably very large. See 'also Tinsley, Garrett, and Friar, "Measurement of Money Demand," pp. Al-A10« - 26 Another candidate for inclusion in proposed; M-3 is Eurodollar deposits held by the U.S. nonbank public. Data on such holdings, however, are not available on a timely basis and are incomplete. Quarterly, seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

24 Federal Reserve Bulletin • January 1979 that are strongly influenced by regulatory ceil- predictable relationship with GNP. However, ings..27 since recent financial innovations have funda- The tendency for the growth of proposed M-3 mentally altered the characteristics of the pubto be steadier than that of proposed M-2 is also lic's monetary assets, the usefulness of such displayed in their respective velocities, pre- econometric evidence is limited. In these cases, sented in chart 11. In contrast to the velocities an important econometric postulate—that the of narrower measures of money, the velocity public view the aggregate being demanded (in of proposed M-3 has tended to decline over time this case money) as having homogeneous and has shown less cyclical variability than that properties over the sample period—may be vioof proposed M-2, lated. Moreover, given recent innovations and regulatory changes, a monetary aggregate selected for its desirable econometric properties EMPIRICAL EVIDENCE based on past relationships may no longer be A criterion that .is frequently suggested, for se- closely linked, with the ultimate targets; while lecting among alternative measures of monetary another, having weaker econometric properties aggregates is the degree to which each is linked in the past, may now be more tightly linked to the ultimate targets, such as GNP. In a variety with the ultimate targets. Indeed, a reexamiof theories of aggregate economic activity, the nation of the definitions of the monetary aggrestock of money is related to GNP and to other gates is warranted precisely because the estabeconomic variables, with changes in the stock lished relationships among the aggregates and of money causing changes in GNP and some other economic variables have been altered by other economic variables. Such theories, while recent developments. not providing much a priori guidance to precise Another empirical basis for selecting measdefinitions of monetary aggregates, imply that ures of the monetary aggregates is their usefulthe more stable and predictable is the public's ness as indicators of the underlying state of the demand for a monetary aggregate, the more economy. Information on the public's holdings predictable will be the impact of changes in the of currency and' deposit balances is generallysupply of this aggregate, other influences re- available on a more timely basis than informamaining the same, on GNP and these other tion about the behavior of the economy. As a economic variables, consequence, incoming information on the Econometric techniques can be used to corre- monetary aggregates can be used to make inferlate changes in alternative measures of the ences regarding developments in the economy money stock with changes in GNP. while re- before direct information is available.28 For exmoving the contribution of other influences, and ample, a slowing of monetary growth may be to estimate demand functions for alternative interpreted to mean that total spending or GNP measures of money. Normally, the definitions is weakening. If the behavior of an indicator selected that use this approach would be those is believed to be highly reliable, monetary polithat had been most strongly correlated with GNP cymakers may wish to adjust the posture of or had displayed the most stable demand rela- policy in the light of this development—before tionship. The presumption would be that the direct information on the state of the economy aggregates selected according to these criteria is available—should they judge it •unhealthy for would continue to have the strongest and most 28 The indicator criterion is very similar to the previous criterion relating to linkages with ultimate targets. In the case of the linkage criterion, causality running 27 In this respect, proposed M-3 is similar to the from money to the ultimate target is presumed. In the current M-2 and M-3 aggregates. As noted in the case of the indicator criterion, no causality is presumed. introduction, movements in those large time deposits Changes in money may cause changes in economic currently included in M-2. and In M-3, tend to stabilize activity, or changes in economic activity may cause M-2 growth by offsetting movements in savings and changes in money, or both may be affected b> some small time deposits. third factor. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 25 the economy. Again, changes in the character speed of adjustment.31 For each monetary agof monetary assets may tend to undermine the gregate, two demand equations are reported. value of some indicators selected on the basis Both are estimated using a sample period beof historical evidence. ginning in late 1960, but the first ends in mid- In the remainder of this section, demand 1978 while the second ends in mid-1974; as properties of the various measures of money are noted earlier, the pace of financial developments first examined. Next, reduced-form equations in recent years has been particularly rapid, and relating GNP to alternative definitions of money many believe that historical statistical relationand selected other variables are presented. Fi- ships have changed since 1974, particularly the nally, the usefulness of the various measures public's demand for demand deposits. In all but as indicators of economic activity is discussed. the M-3 equations, coefficient estimates for the independent variables are short-run or impact elasticities; they indicate how the demand for Properties of Money Demand money responds in the current period, in per- Properties of the demands for the proposed centage terms, to a 1 percent change in GNP monetary aggregates are shown in table 5 and or interest rates.32 those of the current aggregates are shown in Summary statistics for each aggregate are table 6.29 Each money demand equation relates presented in the last three columns of tables 5 the public's demand for an aggregate, on a and 6. The R2 statistic indicates the proportion quarterly basis, to GNP, a market rate of inter- of the variation in the demand for the monetary est, the rate on commercial bank passbook sav- aggregate that is explained by GNP, interest ings, and, in the case of the broader aggregates, rates, and the lagged dependent variable; and a rate representing the yield on commercial bank the standard error of estimate is a measure of time deposits.30 In each instance, the public is the amount by which money demand estimated assumed to adjust its actual money balances from the equation differs from the actual money partially to a desired level—based on GNP and stock. For example, the standard error of estiinterest rates—and the coefficient of the lagged mate for proposed M-l over the longer sample dependent variable can be used for inferring the period (equation 5.1a) is 1.8 percent, expressed at an annual rate, which suggests that about two-thirds of the estimation errors for proposed M-l are smaller than 1.8 percent. The final 29 More extensive evidence on the properties of column provides an indication of how well the money demand functions for current and proposed ag- money demand equation has predicted the rate gregates, over a variety of sample and postsample of growth of the money stock in the period from periods, is discussed in Richard D. Porter, Eileen Mauskopf, David E. Lindsey, and Richard Berner, mid-1974 to mid-1978 ;33 the smaller the root ''Current and Proposed Monetary Aggregates: Some Empirical Issues" (Board of Governors of the Federal 31 The coefficient of adjustment is equal to 1 minus Reserve System, Division of Research and Statistics, the coefficient of the lagged dependent variable. For Econometric and Computer Applications Section, Jan- example, if the coefficient of the lagged dependent uary 1979; processed). variable has a value of 0.9, the public removes 10 30 For all of the monetary aggregates except proposed percent of the discrepancy between its actual and its and current M-3, the money stock and GNP are divided desired money balances in any one quarter; thus, about by the implicit GNP price deflator. Also, the lagged one-half of the adjustment to desired money balances dependent variable in each case is divided by current, is completed in two years. Implied speeds of adjustment and not lagged, prices, in order to permit the equation for the monetary aggregates are all apparently very to pick up potential lagged responses in the public's slow. demands for money to changes in the price level. All 32 Long-run elasticities are derived by multiplying of the variables in these equations are entered in log- each coefficient by the reciprocal of 1 minus the coeffiarithmic form and thus coefficient estimates are short- cient of the lagged dependent variable. run elasticities. In the case of both the proposed and 33 Root mean-square errors are for dynamic simulathe current M-3 measures, the money variable and GNP tions expressed in rates of growth; in other words, are divided by current wealth, as is the lagged dependent simulated levels of the money stock are converted to variable in these equations. In all cases, the Cochrane- rates of growth and errors are computed on the basis Orcutt adjustment for serial correlation has been used. of implicit simulated money growth and actual growth. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

26 Federal Reserve Bulletin • January 1979 5. Representative money demand equations for proposed monetary aggregates" Independent variable Summary statistic Root mean-square Commercial Commercial Standard error of Treasury bank bank Lagged error of annualized r b a i t l e l pa s s a r s v a b i te n o g o k de r t a i p m t o e e s 0 it de v p ar e i n a d b e le n t Adj R u 2 s ted pe e ( r s a r c t n a i e m n t n e u t a ) a a t l e g e pe ( g r a r r c n o a e n t w n e u ' t t 1 a h a l g e rate) 5.1 a -.791 .042 -.010 -.009 1.020 .9902 1.80 (-2.439) (3.184) (-2.709) (-.696) (34.842) 5.1b 1.359 .144 -.011 -.024 .733 .9934 1.66 (1.614) (3.632) (-2.382) (-1.359) (6.936) M-1+" 5.2a .208 .067 -.021 .027 -.009 .912 .9945 1.91 (.624) (3.378) (-3.956) (1.398) (-.627) (24.172) 5.2b -.138 .072 -.020 .032 -.019 .934 .9954 1.64 (-.339) (2.876) (-3.715) (1.495) (-1.045) (19.991) M-2* 5.3a -.042 .046 -.027 .034 -.012 .957 .9943 1.99 (-139) (2.681) (-4.514) ' (1.540) (-.824) (41.560) 5.3b -.446 .055 -.025 .042 -.031 .979 .9960 1.76 (-1.342) (2.723) (-4.144) (1.776) (-1.599) (39.100) M-3{ 5.4a -.0009 .0005 -.0007 .004 -.0003 .961 .9974 1.86 (-.116) (.012) (-3.049) (3.412) (-.463) (20.171) 5.4b .0006 -.054 -.001 .004 .0002 1.035 .9960 1.90 (.068) (-1.225) (-3.989) (2.732) (.278) (19.913) a The numbers in parentheses are f-statistics. to 1978Q2. Simulated levels of the money stock are converted to annual l) The a and b equations differ in sample period. The period for rates of growth and errors are computed on the basis of implicit equation 5.1a, 5.2a, and so on, is 1960Q4 to 1978Q2; the period for simulated money growth and actual growth. the b equations is 1960Q4 to 1974Q2. The dependent variable and GNP are divided by the GNP deflator. 1 The time deposit rate used is the one for the time deposit maturity The lagged dependent variable is divided by the GNP deflator in the having the highest yield, after adjusting for the prevailing term structure current period. The specification of the equation is double logarithmic. of interest rates. f The dependent variable, lagged dependent variable, and GNP d The root mean-square error for dynamic simulations over 1974Q3 variable are divided by current nominal wealth. mean-square error for an aggregate, the better though the prediction performance of each is that aggregate's forecasting record during this measure of transactions balances has been poor volatile period.34 in the post-1974 period, proposed M-l has a Equations 5.1a, 5.1b, 6. la, and 6. lb suggest slightly better record than current M-l. that the demands for current and proposed M-1 The second monetary aggregate presented in are similar. The impact of GNP and other ex- table 5 is M-l-K As might be expected, the planatory variables is nearly the same for each demand for this aggregate tends to increase with narrow measure of money. Moreover, the coef- increases in the commercial bank passbook rate, ficients of GNP in equations 5.1a and 6.1a show while it declines in response to increases in the a marked decline, respectively, from 5.1b and treasury bill rate and the yield on time deposits. 6.1b in the impact of GNP on each aggregate, In contrast to the demand for both M-l measwhile the coefficient of the lagged dependent ures, the demand for M-1+ has not demonvariable for both M-l measures rose substan- strated a noticeable tendency to shift in the tially over the longer sample period. This con- period since mid-1974; coefficient estimates for trast appears to reflect a decrease in the public's each explanatory variable, with the possible demand for demand deposits—which make up exception of the time deposit rate, are very a considerable share of each M-l aggregate— similar for the two sample periods. Moreover, and is believed to have been an outgrowth of the predictive power of the M-1 + demand the more intensive use of cash management equation during this period, indicated by its root around 1974, particularly by businesses. Al- mean-square error, was better than that of both M-l measures. 34 The prediction performance of all the monetary The demand properties of the proposed M-2 aggregates is relatively weak. However, the 1974-78 aggregate are similar to those of M-1 + . Coeffiperiod is believed to have seen substantial changes in cient estimates indicate that the sensitivity of the characteristics of many of the deposit liabilities appearing in these monetary aggregates. proposed M-2 to interest rates and GNP is nearly Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 27 6. Representative money demand equations for current monetary aggregates11 Independent variable Summary statistic Root Standard mean-square Commercial Commercial error of error of Tre r b a a i t s l e l u ry pa s b s a s a v b n in o k g o k d b e ti p a m o nk e s it d v e L a p a r e g i n a g d b e e l d e n t Adj R u 2 s ted pe e ( r s a c t n i e n m n u t a a a t l e g e an g n r r u a o a t w e li ' t 1 z h ed rate rate* rate) (annual percentage rate) 6.1a -.832 .044 -.009 -.015 1.022 .9916 1.74 (-2.381) (3.151) (-2.347) (-1.089) (29.795) 6.1b 1.530 .163 -.010 -.031 .699 .9946 1.58 (1.848) (3.987) (-2.215) (-1.865) (6.549) M-T 6.2a -.405 .166 -.025 -.004 .023 .856 .9994 1.68 (-1.991) (2.629) (-4.944) (-.187) (1.605) (13.625) 6.2b -.699 .190 -.028 .009 .014 .853 .9993 1.65 2.35 M-3{ (-2.759) (2.335) (-5.145) (.395) (.790) (11.126) 6.3a .004 -.010 -.0009 .003 .0004 .964 .9972 1.54 (.643) (-.307) (-5.184) (3.612) (.861) (21.270) 6.3b .002 -.044 -.001 .003 .0009 1.033 .9966 1.47 (.340) (-1.171) (-5.521) (2.232) (1.349) (19.829) a The numbers in parentheses are f-statistics. to 1978Q2. Simulated levels of the money stock are converted to annual h The a and b equations differ in sample periods. The period for rates of growth and errors are computed on the basis of implicit the a equations is 1960Q4 to 1978Q2; the period for the b equations simulated money growth and actual growth. is 1960Q4 to 1974Q2. 11 The dependent variable and GNP are divided by the GNP deflator. ' The time deposit rate used is the one for the time deposit maturity The lagged dependent variable is divided by the GNP deflator in the having the highest yield, after adjusting for the prevailing market term current period. The specification of the equation is double logarithmic. structure of interest rates. ' The dependent variable, lagged dependent variable, and GNP (l. The root mean-square error for dynamic simulations over 1974Q3 variable are divided by current nominal wealth. the same as that of M-1 -b. While the coeffi- the rate of interest and the wealth variables are cients of the two equations for proposed M-2 more important determinants of the public's shown in table 5 are very similar, other results demand for this aggregate. The properties of the for the 1960s, on the one hand, and the 1970s, public's demand for current M-3 and proposed on the other, suggest that proposed M-2 has M-3 are in many respects similar, as shown in become more transactions-related in the 1970s; tables 5 and 6. in particular, the demand for proposed M-2 appears to have become more responsive to Reduced-Form Equations GNP in the 1970s, and the speed of adjustment of actual to desired proposed M-2 balances Reduced-form equations that relate the annualappears to have increased.35 The prediction per- ized percentage change in GNP, measured in formance of proposed M-2 in the post-1974 current dollars, to current and lagged annualized period is not so good as that of M-1 + , and percentage changes in monetary growth, current proposed M-2 has a larger forecast error than and lagged values of a fiscal variable, and a current M-2 (table 6). strike variable are presented in tables 7 through The demand for proposed M-3 is shown in 10.36 Tables 7 and 8 contain reduced-form the last two equations of table 5. As might be equations and corresponding lag coefficients expected of any broad measure of money, the using the proposed monetary aggregates, and demand for this aggregate is not so strongly tables 9 and 10 contain results for the current influenced by GNP as are the more narrow, measures. Reduced-form results are used by transactions-related measures. In relative terms, some to infer the impact of money growth on 35 See Porter and others, "Current and Proposed Monetary Aggregates," pp. 8, 17-18. The evidence presented in this paper also suggests that the demand 36 More detailed evidence on the reduced-form equafor M-l—both the current and the proposed measure— tions for current and proposed aggregates over a variety has become more sensitive to the passbook savings rate, of sample and postsample periods is discussed in Porter implying that savings balances may have become more and others "Current and Proposed Monetary Aggresubstitutable for transactions balances in the 1970s. gates." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

28 Federal Reserve Bulletin • January 1979 7. Reduced-form equations relating percentage change in nominal GNP to percentage changes in proposed monetary aggregates, a fiscal variable, and a strike variablea Independent variable Summary statistic Standard Root coe m f o fi n c e i y e nts coe S f f u f i m s i c c a i l e o n f ts1 va S r t i r a i b ke le d Adj R u 2 s ted e e ( s r a t r n i o m n r u a a o t l e f error s m 0 q e u ( a a a n r n - e n ual percentage percentage rate) rate) 7.1a 2.197 1.175 1.138 -4.667 .492 2.67 (2.198) (6.133) (3.031) (-4.069) 7.1b 2.508 1.067 .983 -3.666 .432 2.50 (2.586) (5.459) (2.363) (-2.611) M-l + 7.2a 3.317 .801 .900 -4.807 .454 2.77 (3.412) (5.244) (2.223) (-4.159) 7.2b 2.455 .997 .503 -2.743 .407 2.55 (2 126) (4.637) (1.138) (-1.899) M-2 7.3a 4.945 .521 .838 -4.997 .352 3.02 (4.541) (3.149) (1.718) (-4.1 16) 7.3b 5.400 .417 .473 -3.857 .256 2.86 (4.339) (1.937) (.813) (-2.646) M-3 7.4a 3.228 .540 .934 -5.076 .357 3.01 (2.020) (3.098) (1.945) (-4.182) 7.4b 3.290 .494 .501 -3.731 .314 2.74 (2.205) (2.956) (.935) (-2.545) a The equations were estimated using a third-order polynomial dis- ' The fiscal variable is the change in the high-employment federal tributed lag with money and fiscal variables lagged five quarters and deficit as a percent of nominal potential GNP. the coefficients of the final lagged variables constrained to be zero. d The strike variable is the change in manhours lost due to strikes The numbers in parentheses are r-statistics. as a percentage of manhours worked. b The a and b equations differ in sample periods. The period for v Root mean-square error for dynamic simulations over the period the a equations is 1960Q4 to 1978Q2; the period for the b equations 1974Q3 to 1978Q2 are based on coefficient estimates for the sample is 1960Q4 to 1974Q2. period ending 1974Q2. GNP, although considerable care must be used 9.38 For both proposed and current M-l, about in interpreting such results.37 40 percent of the estimated impact of the mone- The reduced-form results for proposed M-l tary aggregate on GNP is felt in the current are given in equations 7.1a and 7.1b. As in the quarter, but much of this may also reflect reverse case of the money demand estimates, two equa- causality running from GNP to money. A comtions are presented for each aggregate. Both parison of the root mean-square errors shows sample periods begin in late 1960, but the first that predictions based on proposed M-l have ends in mid-1978 while the second ends in been marginally better than those based on curmid-1974. In addition, the last column contains rent M-l. the root mean-square error for postsample fore- The sum of the money supply coefficients for casts over the period from mid-1974 to mid- the broader proposed monetary aggregates is 1978, and indicates the recent forecasting record smaller than the sum for proposed M-l. Howof the monetary aggregate. ever, the contemporaneous relationship between The sum of the coefficients of proposed M-l money and GNP is less strong for these broader —shown in the second column—is near unity, the aggregates than for M-1, and a relatively large value suggested by some economic theories. share of the overall measured contribution of Also, the results for proposed M-l are very money growth to GNP growth is attributed to similar to those for current M-1, shown in table prior changes in money. The predictive power of M-1+ is somewhat weaker than that of proposed M-l. Proposed M-2 appears to pre- 37 Reduced-form estimates of the contribution of changes in money to changes in GNP can be artificially strengthened by reverse causality, running from GNP to money. This is a problem primarily of interpreting 38 In both instances, the sum of money coefficients the coefficient of the money variable for the current does not differ much for the two sample periods. This quarter, but also the R2 and standard error of estimate. result contrasts with those for the M-l demand equa- In addition, should changes in a particular measure of tions, which suggest a shift in the relationship between money tend to smooth growth in GNP, the estimated money and GNP in the post-1974 period. This matter impact of this variable on GNP in a reduced-form is discussed in more detail in Porter and others, "Curequation would be understated. rent and Proposed Monetary Aggregates." Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 29 8. Individual lag coefficients for proposed monetary aggregates and a fiscal variable from reduced-form equations a Proposed M-l Proposed M-1 4- Proposed M-2 Proposed M-3 LLaagg Equation 7.1a Equation 7.1b Equation 7.2a Equation 7.2b Equation 7.3a Equation 7.3b Equation 7.4a Equation 7.4b lleennggtthh Fiscal Fiscal Fiscal Fiscal Fiscal Fiscal Fiscal Fiscal Money variable Money variable Money variable Money variable Money variable Money variable Money variable Money variable 0 .444 .180 .373 .370 .259 .057 .326 .186 .156 .050 .120 .105 .011 .088 .060 .169 (2.936) (1.481) (2.362) (2.131) (1.826) (.457) (1.953) (1.085) (1.024) (.367) (.659) (.553) (.064) (.653) (.365) (.922) 1 .231 .245 .225 .076 .043 .203 .099 -.029 .049 .176 .041 -.077 .129 .235 .082 -.006 (2.201) (2.135) (2.126) (.528) (.455) (1.678) (.922) (-199) (.501) (1.228) (.382) (-.424) (1.263) (1.659) (.844) (-.034) 2 .173 .278 .177 .087 .078 .259 .119 .012 .066 .236 .056 .014 .168 .269 .116 .030 (1.807) (2.626) (1.782) (.672) (.897) (2.287) (1.252) (.088) (.729) (1.728) (.547) (.085) (1.737) (1.986) (1.238) (.188) 3 .177 .260 .165 .208 .195 .236 .219 .141 .121 .227 .098 .186 .147 .221 .132 .136 (2.434) (2.614) (2.385) (1.800) (3.285) (2.194) (3.327) (1.133) (1.932) (1.777) (1.393) (1.164) (2.442) (1.716) (2.417) (.890) 4 .150 .174 .127 .243 .225 .146 .234 .193 .128 .149 .102 .245 .085 .121 .103 .173 (1.561) (1.748) (1.360) (1.910) (2.514) (1.397) (2.383) (1.459) (1.322) (1.257) (.917) (1.560) (.875) (1.003) (1.122) (1.122) a The numbers in parentheses are /-statistics. See table 7 for regres- period for the a equations is 1960Q4 to 1978Q2; the period for the sion results. The a and b equations differ in sample period. The sample b equations is 1960Q4 to 1974Q2. 9. Reduced-form equations relating percentage change in nominal GNP to percentage changes in current monetary aggregates, a fiscal variable, and a strike variable11 Independent variable Summary statistic Current Standard a m gg o r n e e g ta a r t y e h Constant co S e m f u o f m i n c e i o y e f n ts coe S f f u f i m s ic c a ie l o n f t s1' va S r t i r a i b k l e e '1 Adj R u 2 s ted (an e e s n r t r u i o a m r l a o t p e f e r- s ( R q a u o n a o n t r u e a m l e e r p r a e o n r r - - e centage rate) centage rate) M-l 8.1a 2.382 1.129 1.184 -4.987 .473 2.72 (2.346) (5.833) (3.093) (-4.328) 8. lb 2.656 1.016 1.047 -4.075 .424 2.51 3.90 (2.842) (5.492) (2.553) (-2.897) M-2 8.2a .681 .955 .997 -5.142 .452 2.78 (.496) (5.504) (2.583) (-4.413) 8.2b 1.090 .877 .614 -3.454 .413 2.54 4.03 (.820) (4.996) (1.466) (-2.405) M-3 8.3a 1.418 .769 .971 -5.239 .431 2.83 (1.015) (4.841) (2.368) (-4.451) 88..33bb 1.863 .699 .610 -3.633 .361 22..6655 33..8888 (1.203) (3.755) (1.288) (-2.479) a The equations were estimated using a third-order polynomial dis- ( The fiscal variable is the change in the high-employment federal tributed lag with money and fiscal variables lagged five quarters and deficit as a percentage of nominal potential GNP. the coefficients of the final lagged variables constrained to be zero. d The strike variable is the change in manhours lost due to strikes The numbers in parentheses are /-statistics. as a percentage of manhours worked. h The a and b equations differ in sample period. The period for the e Root mean-square errors for dynamic simulations over the period a equations is 1960Q4 to 1978Q2; the period for the b equations is 1974Q3 to 1978Q2 are based on coefficient estimates for the sample 1960Q4 to 1974Q2. period ending 1974Q2. 10. Individual lag coefficients for current monetary aggregates and fiscal variable from reduced-form equations'1 Current M-1 Current M-2 Current M-3 LLaagg Equation 8.1a Equation 8.1b Equation 8.2a Equation 8.2b Equation 8.3a Equation 8.3b lleennggtthh Fiscal Fiscal Fiscal Fiscal Fiscal Fiscal Money variable Money variable Money variable Money variable Money variable Money variable 0 ,405 .178 .292 .375 .191 .107 .205 .253 .030 .114 .078 .184 (2.626) (1.431) (1.869) (2.148) (1.309) (.863) (1.395) (1.477) (.184) (.875)^ (.437) (1.035) 1 .257 .263 .264 .109 .163 .267 .131 .058 .162 .260 * .097 .022 (2.400) (2.262) (2.494) (.773) (1.782) (2.330) (1.488) (.422) (1.575) (2.120) (.903) (-144) 2 .192 .297 .218 .1 14 .196 .290 .159 .051 .223 .279 .157 .059 (1.962) (2.768) (2.214) (.903) (2.289) (2.701) (1.921) (.395) (2.294) (2.434) (1.525) (419) 3 .161 .271 .157 .215 .224 .222 .204 .116 .215 .213 .200 .160 (2.199) (2.672) (2.342) (1.890) (3.977) (2.129) (3.863) (.943) (3.599) (1.958) (3.256) (1.187) 4 .113 .175 .084 .235 .181 .110 .179 .137 .140 .105 .168 .186 (1.143) (1.732) (.892) (1.856) (2.168) (1.059) (2.262) (1.040) (1.455) (991) (1.672) (1.327) a The numbers in parentheses are /-statistics. See table 8 for the sample period for the a equations is 1960Q4 to 1978Q2; the period regression results. The a and b equations differ in sample period. The for the b equations is 1960Q4 to 1974Q2. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

30 Federal Reserve Bulletin • January 1979 diet GNP growth slightly better than does cur- deviations in the rate of growth of GNP from rent M-2, while the recent prediction record for trend can be detected using deviations in the proposed M-3 is poorer than that of current M-3. rates of growth of alternative measures of money from trend. A higher indicator value for a monetary aggregate means that more can be Indicator Properties inferred from it about current growth in GNP. Since measures of the monetary aggregates are In the limit, with an indicator value of 100, available with a relatively short lag, they may variations in monetary growth would serve as serve as valuable indicators of the current state perfect indicators of both the direction and the of the economy, before direct information is magnitude of variations in GNP growth. available, and thus permit more timely adjust- In general, the narrower measures of money ments of policy.39 Table 11 contains estimates contain more useful information about underlyof the various current and proposed measures ing GNP growth than do the broader aggregates. of money as indicators of GNP growth for three For the proposed aggregates, indicator values periods—the period of the 1960s, the period of generally decline with each successive level of the 1970s, and the entire sample period.40 In aggregation. In addition, proposed M-l tends essence, the numbers show the extent to which to be a better indicator of GNP growth than is current M-l, particularly during the 1970s. While the indicator value of proposed M-2 was 39 Some nonfinancial variables, such as retail sales, very low for the 1960s, it increased considerably are also available with a relatively short lag and can in the 1970s; indeed, for the period of the be used as indicators of movements in economic activity. 1970s, proposed M-2 had a higher indicator 40 See P. A. Tinsley, P. A. Spindt, with M. E. Friar, value than current M-2. As an indicator of GNP "Indicator and Filter Attributes of Monetary Aggregrowth, current M-3 tends to outperform progates: A Nit-Picking Case for Disaggregation" (Board of Governors of the Federal Reserve System, Division posed M-3.41 of Research and Statistics, Special Studies Section, October 1978; processed). The authors conclude that more useful information about the state of the economy CONTROLLABILITY can be obtained by using the components of monetary aggregates jointly than by using the aggregates them- Another important consideration in selecting selves. monetary aggregates is how well the Federal Reserve can control their size and rate of 11. Monetary Aggregates as Indicators of GNP growth. Some aggregates, while closely linked Growth to ultimate targets, may be difficult to control Percent with the available instruments of monetary pol- Indicator valuea MMoonneettaarryy aaggggrreeggaattee icy. To a considerable extent, the Federal Re- 1960Q4- 1960Q4— 1970Q1- 1978Q2 1969Q4 1978Q2 serve's control over a monetary aggregate will Proposed depend on the system's operating procedures— M-l 33 18 36 M M- - 1 2 + 2 1 2 3 * 6 1 1 8 7 whether its operating target is reserves or short- M-3 11 * 7 term interest rates. Current M-l 29 15 30 M-2 17 5 13 M-3 14 11 41 Note that the indicator results are for a highly SOURCE: Based on P. A. Tinsley, P. A. Spindt, with M. E. Friar, simplified situation, one for which no specific model "Indicator and Filter Attributes of Monetary Aggregates: A Nit-Picking of the economy is utilized. Alternatively, econometric Case for Disaggregation" (Board of Governors of the Federal Reserve models of the economy, such as the board's quarterly System, Division of Research and Statistics, Special Studies Section, October 1978; processed), pp. 31-32. model, can be used to relate forecast errors in money a The percentage by which the variance of the forecast error of the growth to forecast errors in GNP growth; in this way, growth rate of nominal GNP can be reduced using current observations the accuracy of GNP forecasts can be improved as on the growth rate of the corresponding monetary aggregate. These values were obtained by regressing the percentage change in nominal information on money growth becomes available. Esti- GNP on the percentage change in the corresponding monetary aggregate. mations of the indicator value of alternative measures The R2 statistic, adjusted for degrees of freedom, is then a measure of money using more sophisticated procedures yield of the percentage by which the variance of forecasted GNP can be results that are qualitatively similar to the ones discussed reduced by observing the change in the monetary aggregate. * Negligible. here. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 31 Under a reserves operating target, a key factor 12. Proportion of monetary aggregates subject to reserve requirements set by the Federal in monetary control is the nature of the reserve Reserve, June 1978 requirements applied to the components of the monetary aggregate. Deposits that are subject Percent to reserve requirements established by the Fed- Total Aggregate aggregate " Deposits eral Reserve and for which required reserves Proposed must be held as vault cash or deposits with the M-l 75.8 66.9 M-1 + 73.2 67.9 Federal Reserve are generally those that can be M-2 49.3 43.0 M-3 44.7 41.0 controlled best through use of a reserves aggre- Current gate.42 Although other deposits—those of non- M-l 76.4 67.9 M-2 70.2 66.5 member institutions—may be backed indirectly M-3 41.8 37.1 by reserves at the Federal Reserve through de- a Currency is treated as subject to a 100 percent Federal Reserve reserve requirement. posit balances held with member bank correspondents, the slippage between the provision changes in short-term interest rates.43 A desired of reserves by the Federal Reserve and the change in the quantity of a monetary aggregate volume of such deposits is typically more pro- is achieved by varying the attractiveness of nounced than the slippage for deposits directly holding the monetary aggregate through changes subject to the system's reserve requirements. in short-term interest rates. Table 12 shows the proportions of each of Although a change in interest rates will have the proposed (and current) measures of money a greater effect on those aggregates that are most that are subject to reserve requirements estab- interest sensitive, what is important from the lished by the Federal Reserve. Larger propor- standpoint of controlling money using interest tions of the proposed M-l and M-l-f measures rates is whether the particular aggregate under consideration is in fact sensitive to interest rates. than of the proposed broader aggregates are Indeed, economic theory establishes that in subject to Federal Reserve reserve requirements. achieving some desired monetary stimulus the A comparison of the proposed aggregates with quantities of monetary aggregates that are highly their current counterparts reveals that by and sensitive to changes in interest rates must be large smaller percentages of the proposed agchanged by more—in relative terms—than aggregates are subject to system reserve requiregregates that are less sensitive to interest rates; ments. Thus, with a reserves operating target, hence, while a given change in interest rates control might be weaker over the proposed will have 3 greater impact on the quantities of aggregates than over the current aggregates, highly interest-sensitive monetary aggregates, a unless legislation were approved extending relarger change in their quantities is needed to serve requirements to the monetary liabilities of obtain an economic objective. nonmember institutions. With an interest rate operating target, control All of the proposed monetary aggregates over a monetary aggregate depends on whether move inversely to changes in the treasury bill the demand for that aggregate is sensitive to rate and thus can be controlled using an interest rate operating traget (see table 5, column 3). Proposed M-l is less sensitive to current changes in interest rates than are M-1+ and 42 Required reserve ratios are also important to monetary control. In general, with higher ratios the control over monetary aggregates is strengthened with a re- 43 In addition, control over a monetary aggregate serves operating target. Also, monetary control under under an interest rate operating target is importantly a reserves operating target is enhanced when similar influenced by the ability to forecast the impact of other ratios are required for the various deposits included in factors, particularly GNP, on the public's demand for the aggregate. See Kenneth J. Kopecky, "The Rela- this aggregate. In other words, the stability of the tionship between Reserve Ratios and the Monetary relationship between the public's demand for an aggre- Aggregates under Reserves and Federal Funds Rate gate and the explanatory variables, such as GNP and Operating Targets," Staff Economic Studies 100 (Board interest rates, together with the accuracy of projections of Governors of the Federal Reserve System, December of explanatory variables other than interest rates, deter- 1978). mines the potential controllability of this aggregate. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

32 Federal Reserve Bulletin • January 1979 proposed M-2. In addition, a comparison of their own demand deposit business. Simply tables 5 and 6 suggests that the impact of combining all demand deposits at all commerchanges in interest rates on the proposed mone- cial banks would overstate the public's holdings tary aggregates is about the same as that on their of demand balances by the amount of such current counterparts. Thus, with an interest rate interbank demand balances, because demand operating target, controlling the proposed mon- balances held by commercial banks for use in etary aggregates would likely be no more diffi- their own demand deposit business would be cult than controlling the current measures.44 counted once when they were deposited by the public and again when they were redeposited at other banks. Similarly, demand deposits maintained by commercial banks and thrift in- CONSOLIDATION stitutions for conducting their savings business The monetary aggregates being proposed by the would be netted out from proposed M-2, and board staff have been constructed using princi- demand balances maintained by depositary inples of account consolidation to exclude those stitutions for conducting their time deposit deposits held by depositary institutions with business would be netted from proposed M-3. other depositary institutions that would other- Consolidation similarly involves the netting wise lead to double counting. In particular, at out of some savings and time deposits in coneach level of aggregation an attempt has been structing the broader monetary aggregates. This made to net out deposits maintained by deposi- matter is described in more detail in the appentary institutions for purposes of servicing other dix. deposits included in the measure.45 This proce- While in principle this kind of consolidation dure yields a more accurate estimate of the is straightforward, in practice data limitations public's monetary assets. necessitate some compromises. For example, Consolidation involves primarily the appro- although demand deposits between commercial priate netting out of some or all demand deposits banks can be estimated with some precision, the at commercial banks owned by commercial proportions held for conducting demand, savbanks and, for the broader measures, by other ings, and time deposit business are unknown. depositary institutions. A depositary institution As a consequence, the conventional practice of can increase the liquidity, and thus the attrac- deducting all interbank demand deposits from tiveness, of its deposit liabilities by maintaining gross demand deposits has been followed here, demand balances that can be used to meet the although it tends to understate somewhat the withdrawal requests of its customers; such de- appropriate measure of the public's demand mand balances may also serve as clearing bal- deposits. In addition, shortcomings in the data ances. For example, commercial banks hold render it difficult to measure and to allocate by demand balances with other commercial banks, function all demand deposits owned by thrift a large portion of which is used for conducting institutions, although an effort was made to allocate by function demand deposits owned by 44 Another consideration in controlling a monetary mutual savings banks. These and other issues aggregate with an interest rate target is the influence regarding the mechanics of consolidation are of unpredictable factors on the demand for that aggrediscussed in the appendix. gate. The greater the influence of unpredictable factors on money demand, the less precise is monetary control. Standard errors of estimate presented in tables 5 and 6, which reflect the impact of factors other than explanatory variables on money demand, suggest that the DATA AVAILABILITY AND DATA NEEDS effects of unpredictable influences have been roughly similar on the proposed monetary aggregates and on All proposed monetary aggregates are available their current counterparts, particularly in the cases of on a monthly basis from existing sources.4(i Data the narrower aggregates. 45 This is in line with the recommendation of the Advisory Committee on Monetary Statistics. This rec- 46 Preliminary historical data on the proposed moneommendation served as a guide in consolidating ac- tary aggregates and related series are available from the counts in the proposed monetary aggregates. See Im- Board of Governors of the Federal Reserve System, proving the Monetary Aggregates: Report, pp. 12-17. Division of Research and Statistics, Banking Section. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 33 on total deposits for thrift institutions—the sum adopted and current data flows used, the quality of savings and time deposits—are available as of initially published estimates of M-l and M-2 of the end of each month with a lag of about is likely to deteriorate and such estimates are one week.47 At that time, savings deposits at likely to be subject to greater revisions than thrift institutions can be crudely estimated for is currently the case.48 In order to reduce the inclusion in M-2, until actual figures on savings size and frequency of such revisions, publicaare available about one month later. Break- tion of the monetary aggregates could be dedowns of total savings deposits at thrift institu- layed from the current schedule or, alternations into transactions balances—for inclusion tively, new data could be collected; in particuin proposed M-l—and ordinary savings bal- lar, timely data on ATS balances, NOW account ances must be estimated until figures are avail- and other transactions balances, and savings and able on NOW accounts and share draft balances time balances at thrift institutions would be at credit unions, which involves an additional needed.49 The collection of such data from nontwo-month lag. The lack of timely data on the member institutions would require the cooperabreakdown of savings and transactions balances tion of the Federal Deposit Insurance Corporaat thrift institutions does not affect the estima- tion, the Federal Home Loan Bank Board, and tion of proposed M-3, since total deposits at the National Credit Union Administration. these institutions are included in this aggregate. Moreover, an accurate and comprehensive In addition to monthly availability, commer- series on commercial bank repurchase agreecial bank demand deposits, savings deposits, ments with the nonbank public would require and time deposits are estimated weekly with a the collection of new data. lag of one week. However, with existing data, any weekly estimations of thrift institution deposits would likely be subject to unusually large 48 See the appendix section on timeliness of data. estimation errors. 49 Also, data on the deposit holdings of savings and Should the proposed monetary aggregates be loans and credit unions would be needed in order more accurately to consolidate accounts and improve measures of the public's money holdings. As noted in the 47 However, sample data on total deposits at thrift previous section, only an incomplete consolidation can institutions are available more promptly and can be used be done using existing data on the deposit holdings of to prepare early estimates of the monetary aggregates. thrift institutions. APPENDIX: DATA SOURCES AND CONSTRUCTION OF THE PROPOSED MONETARY AGGREGATES This appendix describes in detail the data veloped to meet the concept of consolidation sources and the construction of the components used in this redefinition of the monetary aggreof the monetary aggregates being proposed by gates. the board staff . Some of these components were While the new series have been carefully called for by the exclusion from the proposed constructed, they should be regarded as prelimaggregates of deposits of foreign banks and inary until the staff has received comments on official institutions, others by the grouping of them and has made a final review of the data. similar deposits across depositary institutions in The first section of this appendix lists the comthe proposed aggregates. Still others were de- ponents of each of the proposed aggregates; it is followed by a discussion of the timeliness of the data on the components and by a descrip- NOTE. This appendix was prepared by Neva Van tion of current data sources. The next section Peski, Economist, Banking Section, Division of Re- discusses consolidation of interinstitution desearch and Statistics. Norman Mauskopf and Nancy Hill posits, and the final section briefly describes the assisted in constructing the proposed monetary aggregates and related series. seasonal adjustment of the new series. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

34 Federal Reserve Bulletin • January 1979 Al. Components of the Monetary Aggregates June 1978 average Treatment in First inclusion Component (millions monetary aggregate1' Frequency and timing in proposed of dollars)" Proposed I Current of current data1 aggregate Currency Currency outside Treasury, Federal Reserve, and vaults of commercial banks 92,923 Daily (1 -week lag) 1/59 Demand deposits Commercial banks Demand deposits adjusted, excluding all 2.41,584 Daily, member banks (1-week lag) 1/59 bank and foreign official Quarterly, nonmember banks deposits'1 (4-month lag) Due to mutual savings banks 1,408 Weekly, large banks (1-week lag) 1/59 Quarterly, other banks (4-month lag) Due to foreign banks 7,303 Weekly, large banks (1-week lag) 1/59 Quarterly, other banks (4-month lag) Due to banks in territories and possessions 235 Quarterly (4-month lag) 1/59 Due to foreign official institutions 1,285 Weekly, large banks (1-week lag) 1/59 Quarterly, other banks (4-month lag) Federal Reserve float -5,149 Daily (1 -week lag) 1/59 Cash-items-bias adjustment 8,152 Daily (1 -week lag) 1/59 Foreign-related institutions1' Demand deposits adjusted, excluding banks and foreign official deposits 1,409' Daily (1-week lag) 1/59 Due to foreign banks and official institutions 2,055 Monthly (6-week lag) 1/71 Other deposits subject to transfer by draft Demand deposits at mutual savings banks 864 Eh Quarterly (3-month lag) 1/63 NOW accounts At commercial banks 2,080 Eh Daily, member banks (1-week lag) 1/74 Monthly, other banks (3-month lag) At savings and loans 311 Eh Monthly (3-month lag) 1/74 At mutual savings banks 870 Eh Monthly (3-month lag) 1/73 Credit union share draft accounts 576 Eh Quarterly (3-month lag) 1/76 Federal Reserve Foreign and international deposits at Federal Reserve Banks Daily (1 -week lag) 1/59 Savings deposits Commercial banks Total excluding all bank, foreign Daily, member banks (1-week lag) 1/59 official, and U.S. government Quarterly, nonmember banks (4-month lag) deposits, and NOW accounts Due to banks and foreign official institutions 29 Weekly, large banks only (1-week lag) 11/75 Due to U.S. government 62 Quarterly (4-month lag) 1/76 Foreign-related institutions 278 Monthly (6-week lag) 1/73 M-2 Savings deposits Commercial banks Total excluding all bank, foreign 221,282 Daily, member bank (1-week lag) official, U.S. government Quarterly, nonmembers (4-month lag) deposits, and NOW accounts Due to banks and foreign official institutions 29 IJ Weekly, large banks only (1-week lag) 11/75 Due to U.S. government 62 E Quarterly (4-month lag) 1/76 Foreign-related institutions 278 E Monthly (6-week lag) 1/73 Thrift institutions'4 Mutual savings banks, excluding NOW accounts 76,901 E Monthly (6-week lag) 1/59 Savings and loans, excluding NOW accounts 147,949 E Monthly (4-week lag) 1/59 Credit union shares, excluding share draft accounts 50,857 E Monthly (4-week lag) 1/59 Savings of credit unions at credit unions -1,168 E Annually (6-month lag) 1/64 Consolidation component: demand -802 E Weekly, large banks (1-week lag) 1/59 deposits due to mutual savings banks Quarterly, other banks (4-month lag) held at commercial banks to back savings deposits COMPONENTS OE THE NEW AGGREGATES Table Al lists the components of the proposed average indicates that the item enters the calcumonetary aggregates. The table gives the June lation as a subtraction from the total. Also 1978 average for each component and indicates shown are the frequency and timeliness of the whether it was used in the construction of the basic data and the date when the component was proposed aggregate and the comparable current first included in the aggregates. With few exaggregate; a negative sign attached to the June ceptions, new components were included in the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 35 Al. Continued. June 1978 average Treatment in First inclusion First inclusion Component (millions monetary aggregate" in new in new of dollars)11 Proposed 1 Current aggregate aggregate M-3 Time deposits Commercial banks Total excluding all bank, 335,699 I Daily, member banks (1-week lag) 1/59 foreign official, and U.S. govern- Quarterly, other banks (4-month lag) ment deposits Due to domestic commercial banks 6,862 E E Weekly, large banks (1-week lag) 1/59 Quarterly, other banks (4-month lag) Due to foreign and mutual 9,232 E I Weekly, large banks (1-week lag) 1/59 savings banks, and foreign official Quarterly, other banks (4-month lag) institutions DDuuee ttoo UU..SS.. ggoovveerrnnmmeenntt 942 E E Weekly, large banks (1-week lag) 1/59 Quarterly, other banks (4-month lag) Foreign-related institutions1' Total, excluding all bank and foreign official deposits 8,184 I IN Monthly (6-week lag) 1/59 Due to foreign banks and official institutions 2,236 E I" Monthly (6-week lag) 1/59 Due to domestic commercial banks 792 E En Monthly (6-week lag) 1/73 Thrift institutions Mutual savings banks 59,057 I I Monthly (6-week lag) 1/59 Savings and loans 257,015 I I Monthly (4-week lag) 1/59 Consolidation component: demand deposits -605 I I Weekly, large banks (1-week lag) 1/61 due to mutual savings banks held at com- Quarterly, other banks (4-month lag) MEMO m : e r O ci v a e l r b $ a 1 n 0 ks 0 ,0 to 0 0 b a i c n k c l t u i d m e e d d in e p t o o s t i a t l s 165,320 m I (i. m) Weekly, large banks (1-week lag)" 1/59 Monthly, foreign-related institutions (6-week lag) Quarterly, other banks (4-month lag) NOTES TO TABLE AI a A minus sign indicates that the component was subtracted in current M-2 and NOW accounts at savings and loans and mutuals are calculating the total; all other components were added. included in the current M-3. b "i" indicates the component was used in the construction of the ' Time and savings deposits due to domestic commercial banks and aggregate; "E" means the component was not used. the U.S. government are excluded from the current M-2. Because most c "Frequency" refers to the frequency with which basic data are of such deposits are time deposits, no adjustment was made to the reported; "timing"' refers to the lag between the date for which data current M-1 + for the savings portion of the amount excluded; this are reported and availability of final data. For many components, adjustment is made in the proposed M-1 +. preliminary estimates are made based on sample data or related series j A small portion of this item, savings due to domestic commercial and revised when final data become available. banks, is excluded from the current M-2. d "Demand deposits adjusted'' is elsewhere defined as gross demand k Includes mutual savings banks, savings and loan associations, and deposits less deposits of domestic commercial banks, U.S. government credit unions. Savings component excludes NOW accounts, which deposits, and cash items in the process of collection. The item shown appear in the proposed M-l. here also excludes deposits of foreign banks and official institutions I Partly excluded. and mutual savings banks. m Large (over $100,000) negotiable CDs issued by large banks are ° Includes agencies and branches of foreign banks, Edge Act cor- excluded from the current M-3 but included in the current M-4 and porations engaged in banking, and New York State foreign investment M-5; other large time deposits are included in current M-2 and M-3. companies. A portion of demand deposits at Edge corporations is II In the current M-2 and M-3, time deposits at branches of foreign included in the cash-items-bias adjustment. banks (the bulk of the figures shown) are included along with those f This item is slightly larger in the proposed M-l than in the current of other noninsured banks; such deposits include deposits of foreign M-l because of a technical adjustment, so that the components shown banks and official institutions, but exclude deposits of domestic banks. do not add exactly to the current M-l. Time deposits at the other foreign-related institutions are not included K A small amount of demand deposits adjusted held by Edge Act in the current aggregates. corporations outside New York is not included in the current aggregates, ° Total time deposits are available daily with a one-week lag from but is included in the proposed aggregates. member banks; the division between large and small time deposits is h These components are excluded from the current M-l but included based on weekly data from large banks and quarterly data from other in M-1 + . NOW accounts at commercial banks are included in the banks. measures of the aggregates in January of the observation, and the daily values thus assumed year in which they first exceeded $50 million. were averaged over the month. For components based on monthly, quarterly, Table Al shows that the proposed M-l, like or semi-annual observations, monthly and the current M-l, includes currency and demand weekly averages were derived by interpolating deposits adjusted at commercial banks and between observations or by applying ratios in- foreign-related institutions, plus adjustments for terpolated between benchmark observations to Federal Reserve float and cash items bias. The related series. For series with single-day obser- proposed M-l differs from the current M-l by vations each week (Wednesday), the single-day (1) excluding demand deposits due to foreign figures were used for the weekly series, and banks and official institutions, (2) excluding monthly averages were derived by a proration deposits held at the Federal Reserve by foreign of the weeks; that is, the levels for the previous official and international institutions, (3) includsix days were assumed to equal the Wednesday ing transactions-related savings balances— Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

36 Federal Reserve Bulletin • January 1979 NOW accounts at both commercial banks and of deposits due to foreign banks and official thrift institutions and share draft accounts at institutions. Also, a consolidation component credit unions, and (4) including demand depos- has been removed; it is discussed below. its at mutual savings banks.50 The proposed M-1 + adds savings at com- TIMELINESS OF DATA mercial banks to the proposed M-l series. It differs from the current M-l + in that it includes Table Al also shows the lag in availability of savings at all foreign-related institutions en- data for the components of the proposed monegaged in banking in the United States; that is, tary aggregates. For commercial banks, data for savings at agencies of foreign banks and New member banks and large weekly reporting banks York State foreign investment corporations have are available with a one-week lag following the been added to the proposed M-l4- while only close of the statement week on Wednesday. savings at branches of foreign banks were in Preliminary estimates of deposits at nonmember the current M-1 + . In addition, the proposed banks are made weekly from data on small M-1 + excludes demand and savings deposits member banks, using the latest quarterly call due to foreign banks and foreign official institu- report as a benchmark. Final data on nontions. Also, a technical correction is made to member banks are available with about a fourexclude small amounts of savings due to do- month lag.51 mestic commercial banks and the U.S. govern- For savings and loan associations and mutual ment that are now included in M-1 + . savings banks, preliminary estimates of total The proposed M-2 adds to proposed M-l deposits are made from early data on deposit savings deposits (net of transactions-related flows available from a sample of these institusavings already in proposed M-l) at commercial tions: data for deposit flows at mutual savings banks, foreign-related banking institutions in the banks in New York State (accounting for a United States, and thrift institutions. The major substantial part of the total) during the first 23 difference from the current M-2 is that savings days of the month are available before monthdeposits at thrift institutions (mutual savings end, and deposit flows (for the sum of time and banks, savings and loan associations, and credit savings deposits) from a sample of savings and unions) are included, while time deposits at loan associations for the entire month are availcommercial banks are excluded. Other dif- able within a week of month-end. Final monthferences are the inclusion of savings deposits end data for thrift institutions, including a savat agencies of foreign banks and New York ings and time deposit breakdown, are available investment companies, the subtraction of a con- within four to six weeks. solidation component (discussed below), and The schedule of the availability of data—exthe exclusion of savings deposits due to foreign pressed as a percentage of the total of each aggrebanks and official institutions. gate—is summarized in table A2 for both the The proposed M-3 comprises proposed M-2 proposed and the current monetary aggregates. plus time deposits at all commercial banks, The major timing difference between the two foreign-related institutions in the United States, sets of aggregates occurs in M-2: because of and thrift institutions. The major differences the inclusion of thrift savings deposits in the from the current M-3 are the inclusion of nego- proposed M-2, a smaller percentage of final data tiable certificates of deposit (CDs) at large com- is available on a timely basis than was available mercial banks, the inclusion of time deposits for the current M-2, which includes only comat foreign-related institutions, and the exclusion 51 Currently, the reliability and timeliness of a sample of nonmember banks reporting weekly are being tested. 50 The proposed M-l also includes ATS savings The incorporation of these sample data for nonmember deposits and similar transactions-related savings at thrift bank deposits is expected to improve the early estimainstitutions. tion of this component. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 37 A2. Timing of final data availability, proposed CURRENT DATA SOURCES FOR NEW and current monetary aggregates COMPONENTS Based on data for June 1978 Most of the data for the proposed aggregates Per cent of actual data available, by lag are generated from a few basic sources. For Aggregate and component One Four to Four several components of these aggregates, current weeka six weeks a months1' data come from sources that have been in exist- Proposed M-l = currency and checkable ence only a few years, and back data were deposits 75.4 0.6 24.0 Savings deposits component of estimated using a variety of sources and statisti- M-1 + 69.3 0.1 30.6 M-l -I- = M-l plus bank savings 72.9 0.4 26.6 cal procedures.52 Savings deposits component of M-2'' 30.5 55.5 13.7 M-2 = M-l plus all savings deposits '' 49.1 32.7 18.0 Time deposits component of M-3 36.1 48.7 15.2 Banking Institutions M-3 = M-2 plus all time deposits' 43.4 39.7 16.8 The primary data sources for commercial banks Current M-l = Currency and bank de- are the report of deposits filed weekly by memmand deposits 76.9 0.0 23.1 Savings and checkable deposits ber banks, the weekly report of condition, and M-1+ i n = M - M 1 - + l plus checkable 68.4 0.0 31.6 the quarterly report of condition (call report). deposits at thrift institutions and commercial bank savings 73.6 0.0 26.4 Time and savings deposits Report of Deposits. The daily report of decomponent of M-2 63.8 0.0 36.2 M-2 = M-l plus commercial posits is submitted weekly to the Federal Rebank savings and time deposits excluding large ne- serve by all member banks to provide the inforgotiable CDs 69.3 0.0 30.7 Thrift institution component of mation necessary for the computation of reserve M-3 0.0 100.0" 0.0 M-3 = M-2 plus thrift institu- requirements. It provides daily figures from tion deposits 40.8 41.2 18.1 Large negotiable CDs at large which weekly averages are derived of the major commercial banks 100.0 0.0 0.0 M-5 = M-2 plus large negotia- categories of bank deposits—demand, savings, ble CDs at large commercial banks 44.1 38.9 17.0 and time—plus certain cash assets that are also used in the construction of the money stock a Estimates of all monetary aggregates are made one week after the Wednesday close of the week based on past patterns of behavior and, measures. in some cases, early estimates from a sample of institutions. Most of the data available in four to six weeks are from thrift institutions and foreign-related banking institutions. Weekly Report of Condition. The weekly h Most of the data available with a four-month lag are from quarterly condition statements submitted by nonmember banks. Earlier estimates report of condition is a detailed balance sheet of these data are made from member bank data and benchmark ratios from the latest condition report. submitted by a group of large commercial banks ' In the proposed M-2 and M-3 aggregates, percentages sum to as of the close of business each Wednesday. slightly less than 100 because one part of the savings deposit component is available with a six-month lag. The number of weekly reporting banks varied d Very good estimates of total deposits at savings and loan associations and mutual savings banks are available one week after the end over the 1959-78 period but always included of the month. Final data become available four weeks after month-end more than 300 banks; at the end of 1978, 312 for savings and loans, and six weeks after month-end for mutual savings banks. banks were in the sample, and these banks had mercial bank deposits. Currently, the timing of 50 percent of the total deposits of all commercial data availability for the proposed M-l and banks.53 M-1 + is very close to that for the current M-l and M-l + , although as NOW account balances and other transactions-related savings deposits 52 A description of the calculation of the back data is available from the Board of Governors of the Federal grow in importance, either more timely data will Reserve System, Division of Research and Statistics, be required or the proportion of the aggregate Banking Section. requiring estimation will increase. Data for the 53 Beginning in January 1979, the weekly reporting proposed M-3 are available on approximately panel was revised to include only those banks having more than $750 million in domestic office assets as of the same schedule as data for the current M-3 December 31, 1977. The new panel has approximately and M-5 aggregates. 50 percent of the assets of all commercial banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

38 Federal Reserve Bulletin • January 1979 Quarterly Report of Condition. The condition savings and loan associations in New England report (or call report) is a detailed balance sheet began offering them in 1974. submitted by all insured commercial banks four times each year and by noninsured commercial Condition Reports of Foreign-Related Bankbanks and mutual savings banks twice each ing Institutions. Foreign-related instituyear.54 tions—agencies, branches, and domestic bank- Member bank demand deposits adjusted, ing subsidiaries of foreign banks—have submitsavings deposits, and time deposits come from ted monthly reports of condition as of the last the daily report of deposits. For nonmembers, Wednesday, or last day of the month, since deposits are estimated using reported deposits November 1972.55 Edge Act corporations also of small member banks, and are benchmarked submitted the reports monthly from November to the quarterly call report. Most other items 1972 until March 1977, after which they subare taken from the weekly condition reports of mitted them quarterly. large banks and are estimated for other com- Currently, these reports are the source of all mercial banks using quarterly call report rela- of the new components derived from foreigntionships. The items estimated in this fashion in related institutions that enter into the calculation constructing proposed M-l are demand deposits of the proposed monetary aggregates.56 The due to foreign official institutions and due to following items are collected from condition mutual savings banks; in constructing proposed reports: in proposed M-l, demand deposits of M-2, savings deposits due to banks and foreign foreign official institutions and foreign banks official institutions; in constructing proposed (subtracted from total demand deposits) and M-3, time deposits due to the U.S. government, M-l-type deposits of Edge Act corporations mutual savings banks, foreign banks, and do- outside New York; in proposed M-2, savings; mestic commercial banks; in constructing both in proposed M-3, time deposits. proposed M-2 and M-3, the demand, savings, Many of the deposit liabilities of foreignand time deposits due to mutual savings banks related institutions were not large enough (that used in consolidation. Savings deposits due to is, they were less than $50 million) to be inthe U.S. government are estimated from the call cluded in the monetary aggregates before 1972.57 reports for all commercial banks. Mutual Savings Banks NOW Accounts. NOW accounts are reported at month-end to the Federal Reserve Bank of The basic data for deposits at mutual savings Boston by all institutions in New England that banks come from the monthly Research Analoffer them. Data for NOWs at commercial and ysis report published by the National Associamutual savings banks in New York State are es- tion of Mutual Savings Banks for deposits as timated from a sample of institutions that report 55 June and December reports have always been as weekly to the Federal Reserve Bank of New of the last day of the month. Since March 1976, the York. In addition, daily data on NOWs of March and September reports have also been as of the last day of the month. All other reports are as of the member banks in the First Federal Reserve Dislast Wednesday of the month. Daily M-l-type deposits trict are available on the daily report of deposits. at these institutions have been available for several years As noted in the text, NOW accounts have been and are included in both the current and the proposed permitted only fairly recently; mutual savings aggregates. 56 Edge Act corporations engaged in banking submit banks in some New England states first offered a daily deposit report to the Federal Reserve weekly. them in June 1972, and commercial banks and Other foreign-related institutions report M-l-type deposits daily by telephone. 57 Until 1972, deposits of branches of foreign banks 54 The June and December call reports are generally in New York, which formed the major portion of deposit filed as of the last days of those months. Until recently, liabilities of foreign-related institutions, were included the spring and fall call dates varied, but generally in the monetary aggregates on the same basis as those occurred in March or April for the spring call and of other nonmember banks; after 1972, they were esti- September or October for the fall call. Since September mated separately. Other deposit liabilities for which 1975, spring and fall call dates have been set on the pre-1972 data were estimated are discussed in the delast day of March and September, respectively. scription of back data cited in note 52 above. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Redefining the Monetary Aggregates 39 of month-end, based on a sample of about 340 gives estimated total deposit data as of monthmutual savings banks accounting for 85 percent end for all operating savings knd loan associaof total time and savings deposits of these insti- tions, based on the monthly reports of the intutions. In June and December, data are col- sured associations and annual reports of all lected by the NAMSB from all institutions and associations. For the purpose of allocating total are used to benchmark the series. Currently, deposits between proposed M-2 and M-3, de- "savings," "time," and "other" deposits are posits at all associations have been allocated reported separately on the monthly report.58 Sav- between savings and time deposits using the ings deposits included in the proposed M-2 are appropriate proportions for insured associations. derived from this report. Deposits included in The estimation of deposits at savings and loan the time deposit components of the proposed associations before July 1968 is discussed in the M-3 are the sum of time deposits from the description of back data cited in note 52 above. monthly report, and school and club accounts; NOW accounts of savings and loan associathe latter are currently available from a quarterly tions in New England, as mentioned above, are survey of deposit ownership at all mutual sav- reported as of month-end to the Federal Reserve ings banks, conducted by the FDIC.59 That Bank of Boston. quarterly survey is also the current source of data on demand deposits at all mutual savings Credit Unions banks. Before June 1975, when the survey began, demand deposits were estimated from Credit union share deposits as of month-end are semi-annual call reports. available in the Monthly Statistical Release is- NOW accounts of mutual savings banks in sued by the National Credit Union Administra- New England are reported as of month-end, as tion (NCUA) showing major asset and liability mentioned above, to the Federal Reserve Bank items of credit unions. This release is based on of Boston, and weekly to the Federal Reserve monthly reports from 1,200 relatively large Bank of New York by a sample of mutual credit unions (60 percent of which are federal, savings banks in New York State. and the remainder of which are state credit unions) accounting for 30 percent of total credit union assets, plus annual data submitted by all Savings and Loan Associations credit unions. The NCUA also publishes two Deposits at savings and loan associations are annual reports—one for federal credit unions, estimated from two monthly reports published the other for state-chartered credit unions. by the Federal Home Loan Bank Board. The Summaries of the annual year-end balance monthly News contains balance sheet data based sheets published in these reports include, for on month-end reports submitted by all insured most credit unions, balances held with other savings and loans associations, accounting for credit unions. These balances are deducted from 98 percent of all savings and loan deposits. total savings of credit unions to avoid double Since July 1968, it has separated total deposits counting.60 into those paying the regular rate or less and Data on share draft accounts at credit unions those paying more than the regular rate; the are available from the NCUA for federally former are assumed to be savings deposits, the chartered credit unions only. Share draft aclatter, time deposits. The second report, the counts were first authorized for federally charmonthly Selected Balance Sheet Data, All tered institutions in November 1974. End-of- Operating Savings and Loan Associations, month data were reported by credit unions offering share draft accounts from May 1975 to September 1976. After September 1976 only 58 "Other" deposits include demand deposits, school end-of-quarter data are available. and club accounts, non-interest-bearing NOWs, and other accounts. 59 The estimation of savings and time deposits before 1971, and of club and school accounts before 1975, 60 The estimation of balances of credit unions with is discussed in the description of data cited in note 52 other credit unions in earlier years is discussed in the above. description of back data cited in note 52. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

40 Federal Reserve Bulletin • January 1979 Repurchase Agreements rowings of the 46 banks as of the call dates to obtain blowup factors that were applied to Security repurchase agreements (RPs) with the the monthly RP borrowings of the 46 RP renonbank public—a major nondeposit liability of porters. These factors are semi-annual until commercial banks—have not been included in 1972 and quarterly thereafter. the proposed M-3 measure on the grounds that available data are incomplete and any RP esti- CONSOLIDATION OF INTERINSTITUTION mates are likely to contain significantly more DEPOSITS estimation error than the deposit components do. Nevertheless, it is believed that RPs have Insofar as was possible, components of the come to play an important role in the monetary proposed monetary aggregates were consolidated system and an historical RP series has been rather than combined, in line with the recomconstructed using available information. To mendations of the Advisory Committee on create a monthly series for security repurchase Monetary Statistics.63 agreements of all commercial banks with the The committee recommended that in connonbank public extending back to November structing the monetary aggregates, accounts of 1969, monthly RP borrowings of 46 large financial institutions should be consolidated banks, based on daily averages and net of inter- rather than combined. Furthermore, the combank borrowing, were benchmarked to adjusted mittee recommended that in each monetary agcall report data. Monthly RP data for the 46 gregate only those interinstitution deposits banks go back to November 1969. should be removed by consolidation that are Since the call report combines federal funds held for servicing other deposits included in that and RP borrowings from both bank and nonbank aggregate. For example, mutual savings banks sources, the procedure for benchmarking first hold demand deposits with commercial banks; involved the removal of interbank federal funds the committee recommended that the portion of and RP borrowings. Beginning in 1976, inter- these deposits that is held for servicing the bank federal funds and RP borrowings have demand deposit liabilities of mutual savings been available directly from the call report. banks be excluded from M-l because the de- However, to obtain interbank federal funds and mand deposit liabilities of mutual savings banks RP borrowings for earlier periods, it was neces- are included in the proposed M-1, and to include sary to construct estimates.61 The next step in that portion would be to double count. Howbenchmarking involved the removal of federal ever, demand deposits that mutual savings funds borrowed from sources other than com- banks hold at commercial banks on account of mercial banks; this was done using federal funds their savings deposit liabilities should not be lent by the principal institutions placing federal excluded from M-l, but should be removed funds with banks.62 The resulting series, esti- from proposed M-2. Similarly, demand deposits mated RP borrowings by all banks net of inter- held on account of time deposit liabilities should bank borrowings, was then divided by RP bor- be removed from proposed M-3. Since it is not possible to determine what portion of these 61 Interbank borrowing is estimated to have been 110 percent of interbank lending, which is available from the call report before 1976; this ratio is based on the includes only one-day and continuing-contract federal average relation between these two series for the ten funds. The remaining "term" federal funds borrowing call reports ending with June 1978. (Interbank borrow- constituted about 25 percent of all federal funds boring and interbank lending are not identical because the rowing as of April 1974 and December 1977. Accordcall report instructions define banks for the purposes ingly, the data on federal funds lending are multiplied of the borrowing item to include several financial insti- by three-fourths before being subtracted from the call tutions other than commercial banks.) data on federal funds and repurchase agreements. The 62 Federal funds lending by mutual savings banks, data for federal funds lending by mutual savings banks savings and loans, and the Federal Home Loan Bank begins in December 1971; for savings and loans, in System are available over much of the period for which March 1974; and for the Federal Home Loan Bank the benchmarks are needed. These data, however, in- System, in June 1974. clude all federal funds lending, whereas the federal H3 Improving the Monetary Aggregates: Report, pp. funds borrowing listed by banks on the call report 12-14. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

41 A3. Series not consolidated in the construction of the proposed monetary aggregates Estimated size Millions Date Aggregate, type of deposit, and holder of dollars of estimate Reason for not consolidating M-2 Savings held at commercial banks Credit unions 97 December 1976 Infrequency Mutual savings banks 1 June 1978 Smallness Savings and loan associations n.a. Unavailability Savings held at thrift institutions Mutual savings banks n.a. Unavailability Savings and loan associations 89 March 1977 Unavailability'1 M-3 Time deposits held at commercial banks Credit unions 707 December 1976 Infrequency Savings and loan associations 6,019 March 1978 Infrequency Time deposits at thrift institutions Credit unions 1,383 December 1976 Infrequency Mutual savings banks n.a. Unavailability Savings and loan associations 465 March 1978 Infrequency M-2 and M-3 consolidation component Demand deposits held at commercial banks Savings and loan associations 700 March 1978 Infrequency Credit unions 700 December 1976 Infrequency a These data were available until March 1977. n.a. Not available. demand deposits are held to back each type of The effect of combining rather than consolideposit liability at mutual savings banks, as an dating certain accounts is to raise the measured approximation the proportion of each type of levels of proposed M-2 and M-3 from their true deposit liability—demand, savings, or time—to levels. The effect on M-l is negligible. Table total deposit liabilities was used.64 For example, A3 suggests that the size of the components that in June 1978, the ratio of savings deposits to should be removed by consolidation from prototal deposits at mutual savings banks was ap- posed M-2 and M-3, but are not removed beproximately 57 percent; it was estimated that cause the data are lacking, is not negligible. this proportion of mutual savings banks' de- Because data are not available for many command deposits at commercial banks was held ponents, the only reliable conclusion from table to back savings deposits, and they were re- A3 is that the size of the components that should moved from proposed M-2; the balance was be consolidated out of proposed M-2 and M-3 removed from proposed M-3. is not negligible. The only thrift institution deposit holdings for which data are adequate for consolidation purposes are deposits of mutual savings banks at SEASONAL ADJUSTMENT commercial banks (both demand and time), and savings of credit unions at other credit unions. Components of the proposed aggregates were Because of the lack of adequate data, other seasonally adjusted using standard options in the components that these principles suggest should Census X-l 1 program. The seasonal adjustment be removed by consolidation were not removed. routine was applied to the proposed aggregates Table A3 shows the estimated size of interinsti- as follows: tution-consolidation components. In most cases, The currency and the demand deposit comdata are available only semi-annually or an- ponents (covering commercial and mutual savnually. Most components are too large and ings banks, and foreign-related institutions) of variable to be included on the basis of such the proposed M-1 were each seasonally adjusted infrequent observations. For other components, separately. Newly introduced checkable deposdata are not available at all. its—NOW accounts and share draft accounts at credit unions—were not seasonally adjusted. These latter series are of such recent origin that <i4 Because demand deposits are such a small propor- there are not yet enough observations to estabtion of the total deposit liabilities of mutual savings lish a seasonal pattern. The commercial bank banks, no adjustment was made for demand deposits savings deposit component was adjusted held by mutual savings banks to service their demand separately and added to the seasonally adjusted deposit liabilities. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

42 Federal Reserve Bulletin • January 1979 M-l to construct M-1 + . The savings of all adjustment of the output of X-ll, in order to depositary institutions, taken as a whole, were take account of the effects of policy changes seasonally adjusted and added to M-l to con- and other factors in seasonal patterns that are struct M-2. Similarly, time deposits for all in- not fully captured by X-ll. Thus far no such stitutions, taken as a whole, were seasonally examination has been made for the proposed adjusted and added to M-2 to construct M-3. aggregates, nor has the X-ll output undergone The seasonal adjustments presented here judgmental review. In addition, seasonal adshould be regarded as preliminary. For the cur- justment of some disaggregated components, rent monetary aggregates, seasonal adjustment such as savings deposits at savings and loan involves examination of alternative adjustments associations and at mutual savings banks, made by selecting different options available in should be reviewed before a final seasonally the X-ll program, as well as judgmental adjusted series is available. • Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

43 Industrial Production Released for publication January 17 nearly 10 percent above that of a year earlier. Production of durable goods materials in- Industrial production in December increased an creased sharply again in December, reflecting estimated 0.6 percent, the same as the revised continued strength in basic metals and in parts change for November. Production gains in Defor equipment and consumer durable goods; cember were widespread among most major output of these materials was more than 12 product and material groupings, with output of percent above a year earlier. Output of nonautomotive products the major exception. Large durable goods materials increased slightly. Proincreases occurred in production of home goods, duction of energy materials rose moderately as business and defense equipment, construction coal production continued to increase sharply. and business supplies, and durable goods materials. Industrial production in the fourth quarter increased from the third quarter at an annual rate of 7.0 percent. The index for December was 150.4 percent of the 1967 average, 7.7 percent above a year earlier. The preliminary average of the index for 1978 is 5.8 percent above the average for 1977. Output of consumer goods increased 0.5 percent in December. The production of home goods, particularly appliances, advanced sharply following two consecutive months of decline but still remained below the level in September. Auto assemblies declined more than 4 percent to an annual rate of 9.3 million units from a rate of 9.7 million units in November. Production of consumer nondurable goods increased moderately in December. Output of business equipment increased 0.8 percent in December, reflecting continued large gains in F.R. indexes, seasonally adjusted. Latest figures: December. commercial and transit equipment, and was Auto sales and stocks include imports. 1967 = 100 Percentage change from preceding month to— PPPeeerrrccceeennntttaaagggeee ccchhhaaannngggeee IIInnnddduuussstttrrriiiaaalll ppprrroooddduuuccctttiiiooonnn 1978 1978 111222///777777 tttooo Nov." Dec.' July Aug. Sept. Oct. Nov. Dec. 111222///777888 Total 149.5 150.4 .8 .7 .5 .5 .6 .6 7.7 Products, total 147.8 148.8 .7 .8 .2 .2 .7 .7 6.1 Final products 144.8 145.6 .8 .8 .3 .1 .6 .6 5.8 Consumer goods 149.8 150.5 .5 .5 .4 .1 .5 .5 3.2 Durable 162.6 162.8 .2 .4 -.7 1.1 .4 .1 4.5 Nondurable 144.8 145.5 .6 .5 .9 -.3 .6 .5 2.6 Business equipment 167.9 169.3 1.2 1.0 .2 .7 .6 .8 9.9 Intermediate products 159.2 160.5 .6 .5 .4 .7 .7 .8 6.7 Construction supplies 157.7 159.1 .9 .8 .6 6 .7 .9 7.3 Materials 152.2 152.9 1.0 .5 .7 1.1 .6 .5 10.2 ''Preliminary. ''Estimated. NOTE.—Indexes are seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

45 Announcements EARNINGS OF FEDERAL RESERVE BANKS market exchange rates of December 29, 1978, to value the System's foreign currency holdings Preliminary figures indicate that gross current and foreign currency commitments; liquidation earnings of the Federal Reserve Banks or payment may actually take place at exchange amounted to $8,455 million during 1978, a 22.7 rates that differ from these rates. percent increase from a year earlier. Current Earnings of the Federal Reserve System are expenses for the 12 Reserve Banks and their derived primarily from U.S. government sebranches totaled $653 million—4.6 percent curities that the Federal Reserve has acquired above a year earlier—leaving current net earnthrough open market operations, one of the tools ings of $7,803 million. of monetary policy. Net earnings before payments to the Treasury totaled $7,116 million. Payments to the Treasury as interest on Federal Reserve notes DEFAULT ON MUNICIPAL amounted to $7,006 million; statutory dividends GENERAL OBLIGATION SECURITIES to member banks, $63 million; and additions In light of the default on payment of municipal to Reserve Bank surplus, $47 million. securities by the city of Cleveland, Ohio, the Under the policy adopted by the Board of following statement was issued on December Governors at the end of 1964, all net earnings 18, 1978, by the three federal bank regulatory after the statutory dividend to member banks agencies.1 and additions to surplus to bring it to the level of paid-in capital were paid to the U.S. Treasury It is not possible to anticipate the extent as interest on Federal Reserve notes. to which a default on a municipal general Compared with 1977, gross earnings were up obligation may affect the ultimate payment $1,564 million due to an increase of $1,546 of such an obligation, due to the fact that million on U.S. government securities. such obligations are backed by the full faith Assessment for expenditures of the Board of and credit of an issuing state, city, or other political subdivision that has general taxing Governors amounted to $53 million. There was authority. In view of these uncertainties, the a $633 million net deduction in the profit and bank regulators recently reviewed the bank loss account, primarily because of a net loss examination procedures that apply to deof $130 million on sales of U.S. government faulted securities and decided to allow for securities and $506 million on foreign exchange a market stabilization period in order that operations. a more accurate estimate of the value of the The $506 million loss on foreign exchange securities may be made. operations includes realized losses of $297 mil- Under the new procedures applying to lion and unrealized losses of $209 million re- defaulted municipal general obligation sesulting from the revaluation of foreign exchange curities, a period of time will be provided to permit the market for these defaulted holdings and outstanding commitments at current exchange rates. Of these amounts, $268 1 The Comptroller of the Currency (supervisor of million and $150 million, respectively, reflect national banks); the Federal Deposit Insurance Corlosses associated with Swiss franc commitments poration (supervisor of state-chartered banks that are not members of the Federal Reserve System); and the Board entered into before August 15, 1971. The total of Governors (supervisor of state-chartered member unrealized net loss was calculated by using banks). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

46 Federal Reserve Bulletin • January 1979 securities to stabilize or for the issuer to put in nonbank activities, in the United States or in place budgetary, tax, or other actions that abroad, to be published in the Federal Register. may eliminate the default, or otherwise im- When such a proposal concerns de novo nonprove the post-default market value of the bank activities the bank holding company must securities. file with the appropriate Reserve Bank a statement of the geographic scope of the proposed The Federal Reserve Board, the Comptroller of the Currency, and the Federal activity. This geographic area may not be en- Deposit Insurance Corporation have agreed larged without a further application. on the following treatment by bank exam- In proposing this regulatory amendment in iners of defaulted state or local general obli- July the board said that several years' experigations held by banks: ence with the existing requirement for publica- 1. After a default has occurred, holdings tion in local newspapers indicated such notices of the defaulted issue will be listed in examimposed a burden on bank holding companies ination reports for appropriate treatment. without accomplishing their intended purpose of 2. Depreciation in the defaulted municiallowing parties an opportunity to comment. pal general obligation will not be classified In a further action the board added language as a loss for the purposes of a bank examito Regulation Y that would permit bank holding nation while a market is in the process of being reestablished for the defaulted security companies and their subsidiaries to conduct or other steps are being taken that will im- abroad previously approved nonbanking activiprove the quality of the security. ties 45 days after informing the appropriate 3. Adjustments to a bank's capital posi- Reserve Bank. This applies only to domestic tion will be required when reasonable esti- bank holding companies and domestic nonbank mates of value can be determined. subsidiaries and clarifies and formalizes proce- 4. The default of a general obligation of dures already in use. The board proposed this a municipal issuer will not be viewed by the action in April. supervisory authorities as an overriding fac- The board's action concerning publication is tor in the appraisal of other obligations of effective with applications filed after the end of the same issuer, nor will it preclude the 1978. Applications filed before that time will purchase by banks of other obligations of the same issuer. be processed under previous rules. The above procedures represent interim adjustments by federal banking agencies in a REGULATION Z: GUIDELINES Uniform Agreement (written in 1938) on the Uniform guidelines for the enforcement of the treatment of investment securities held by Truth in Lending law and its implementing banks. That agreement, currently being studied regulations have been adopted by the five federal for appropriate revision, provides that examagencies that regulate federally insured cominers would classify immediately as a loss the mercial banks, mutual savings banks, savings net market depreciation of securities in default. and loan associations, and credit unions.2 The agencies adopted the enforcement guide- REGULATION Y: AMENDMENT lines after consideration of some 300 comments received following publication of proposed The Board of Governors has adopted amendments to its Regulation Y (Bank Holding Com- 2 The Comptroller of the Currency (supervisor of panies) concerning publication by bank holding national banks); the Federal Deposit Insurance Corcompanies of their intention to engage in non- poration (supervisor of federally insured, state-chartered nonmember banks and mutual savings banks); the Board bank activities and procedures in commencing of Governors (supervisor of federally insured, nonbank activities abroad. state-chartered member banks); the Federal Home Loan One of the two amendments, which do not Bank Board (supervisor of federally insured savings and loan associations); and the National Credit Union Adapply to banking activities, permits notice of ministration (supervisor of federally insured credit intention by bank holding companies to engage unions). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 47 guidelines last year. The guidelines call for The guidelines, viewed by the agencies as reimbursement to individuals for overcharges of minimum standards for enforcement, apply $1 or more, or for smaller overcharges that are specifically to violations in other than open-end part of a consistent pattern of violation or result transactions. Violations of disclosure requirefrom gross negligence or willful violations of ments in open-end transactions (such as use of the act. a credit card) will be treated on a case by case In adopting the guidelines for the enforcement basis, but subject to the same general treatment of the requirements of the Truth in Lending Act as provided by the guidelines. Where violations for disclosure of the true costs of using credit, are discovered in loans purchased by one instithe five agencies said: tution from another, the enforcing agency for the holder of the loan must notify the supervisor Coordination among the agencies is desiraof the institution that originated the credit. ble in order to bring about uniformity in the Each enforcing agency retains authority to administrative actions that will be taken when violations of the Act are detected. To take appropriate alternative action consistent that end, the agencies have developed a set with the guidelines. The five-agency statement of policy guidelines for measuring and cor- of policy does not preclude enforcement of recting the conditions resulting from certain provisions of the act not covered by the guideviolations of the Truth in Lending Act. lines. The guidelines . . . are intended to address The full text of the Joint Notice of Statement those violations which result in overcharges of Enforcement Policy for Regulation Z, into customers. cluding the guidelines, may be obtained upon It should be emphasized that it will continue request to the five regulatory agencies. to be the policy of the enforcing agencies that, whenever any violation of the Act is CONSUMER ADVISORY COUNCIL detected, prospective correction of the violation will be required—that is, creditors The Federal Reserve has named a new chairman will be required to take whatever action is and vice chairman and appointed eight new necessary to ensure that violations do not members to its Consumer Advisory Council. recur. William D. Warren, Dean of the School of These guidelines are not intended to sub- Law of the University of California at Los stitute for any other administrative authority Angeles, who had previously served as vice that any of the agencies has to enforce the chairman, was named chairman of the council. Act, nor do they foreclose the customer's He replaces Mrs. Leonor K. Sullivan, St. Louis, right to bring a civil action where authorized Missouri, a former member of the Congress, by the Act. Further, where apparently willful whose term on the council expired. Mrs. Sulliand knowing violations are found, the agenvan, who has served as chairman since the cies will notify the Department of Justice. council was created two years ago, was named As new examination data concerning the extent and type of violations are received, to the honorary post of chairman emeritus for the guidelines will be reviewed and revised a two-year period. as appropriate. They may be modified at the Marcia A. Hakala, Assistant to the Dean of discretion of the agencies so as to be more the School of Fine Arts of the University of responsive to specific or unique circum- Nebraska at Omaha, was appointed vice chairstances that may exist. man. Mrs. Hakala has served as a member of the council since 1977. The Truth in Lending Act was written in 1968. At the direction of the Congress the The Board also named the following persons to replace members whose terms have expired: Federal Reserve Board wrote implementing rules—Regulation Z—for the use of creditors, James L. Brown, Milwaukee, Wisconsin, consumers, and federal regulators of creditors. is director of the University of Wisconsin The rules of application for the guidelines Extension Center for Consumer Affairs. He state the following: was a staff attorney with the Milwaukee Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

48 Federal Reserve Bulletin • January 1979 Legal Services before joining the Center and School in Washington, D.C. He has written has served as Chairman of the Legislative numerous articles on federal consumer Committee of the Wisconsin Consumers credit legislation and has served as Counsel League since 1976. He has served as a to the Senate Banking Committee's Conconsultant on electronic fund transfer sys- sumer Affairs Subcommittee. He has also tems for various organizations, including the acted as a consultant to several federal bank House and Senate Banking Committees, and regulatory agencies, including the Federal has helped draft revisions and amendments Reserve Board, where he helped develop to the Wisconsin Consumer Act. legislative proposals for simplifying the Truth in Lending Act. Mr. Rohner is also Mark E. Budnitz, Newton, Massachu- co-author of a consumer law casebook and setts, is the executive director of the Na- a member of the American Bar Committee tional Consumer Law Center, in Boston, on the Regulation of Consumer Credit. Massachusetts. He formerly was a supervising attorney for the Civil Clinical Program Henry S. Schechter, Washington, D.C., of Boston University Law School and a staff is Director of the Department of Urban Afattorney for Greater Boston Legal Services. fairs of the AFL-CIO and has extensive He has specialized in consumer law and experience in housing, urban development, electronic fund transfer systems. mortgage finance, and other financial matters affecting consumers. Before joining the Harvey M., Kuhnley, Edina, Minnesota, is the chief executive officer of Twin City AFL-CIO, he was the Senior Specialist in Federal Savings and Loan Association, the Housing with the Congressional Research largest S&L in the Upper Midwest. He was Service of the Library of Congress and, formerly executive vice president and secre- before that, Director of the Office of Ecotary and chairman of the association's loan nomic and Market Analysis of the Departcommittee. Before becoming president and ment of Housing and Urban Development. chief executive officer, Mr. Kuhnley spent He also held positions with the Housing and 28 years at Twin City Federal gaining expe- Home Finance Agency, the Veterans Adrience in all phases of the savings and loan ministration, Department of Commerce, business. He has been active in Minneapolis War Production Board, and the U.S. Houscivic affairs and in state and national trade ing Authority. associations for the savings and loan industry. Richard A. Van Winkle, Salt Lake City, Utah, is President and a Director of Lockhart Florence M. Rice, New York, New York, Finance Company, a financial holding comis co-founder and president of the Harlem pany, and has been active in consumer fi- Consumer Education Council and the Nanance and banking for many years. He was tional Black Consumers. She is one of the President of the former American Industrial early leaders of the consumer movement and Bankers Association. This association has been active, as a volunteer, in a range merged with the National Consumer Finance of consumer advocacy issues, including Association, and Mr. Van Winkle later most recently, electronic fund transfer sysserved as President of NCFA for two years. tems. She has held a number of state, na- He is also the Executive Vice President and tional, and international positions, including Director of Zions Utah Bancorporation, a that of official member to the U.S. Delega- bank holding company. He has directed a tion to the World Congress of the Interna- number of civic and charitable organizations tional Women's Year at Berlin in 1975; and in Salt Lake City. representative to the U.N. Congress of Non-Governmental Organizations in 1976. Mary W. Walker, Monroe, Georgia, is She teaches consumer education at Malcolm the President of the National Bank of Walton King College in New York City and hosts County, in Monroe, Georgia. She has been a weekly public affairs radio program. with the bank since 1951 and has worked Ralph J. Rohner, Washington, D.C., is in every department. She has participated in a Professor at the Catholic University Law consumer conferences through the local Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Announcements 49 Chamber of Commerce. She also served as to be sent to heads of the affected bank holding Chairman of the Advisory Board for the companies said, in part: Walton County Retardation Center. Mrs. Walker has been a member of the Govern- In view of the large number of divestiture ment Relations Council of the American plans and retention applications yet to be Bankers Association and a member of the filed (some 314 companies with over 400 executive committee of several committees subsidiaries), the board, in order to assure of divisions of the ABA. that compliance with the Act will be carried out in an orderly manner, has established The council advises on the board's respon- September 30, 1979, as the date by which sibilities in the field of consumer credit protec- divestiture plans or retention applications tion laws. Beginning with the Truth in Lending should be filed with this Reserve Bank. Act of 1968, the Congress has directed the board Failure to comply will significantly increase to write regulations to give effect to many of the prospects that these activities will bethe consumer credit laws. The Consumer Advi- come candidates for forced sales because of the lack of sufficient time prior to the nonsory Council was established by the Congress, extendible statutory deadline of December at the suggestion of the board, in 1976. Its 31, 1980, in which to process tardy filings. members come from all parts of the nation and include a broad representation of consumer and In October 1977 the board had suggested a creditor interests. It meets quarterly with the voluntary filing date of June 30, 1978. In Febboard. ruary 1977 the board had issued a general policy statement on divestitures that urged early action on the divestitures required by the end of 1980. DIVESTITURE PLANS OF BANK The board's letter pointed out that although HOLDING COMPANIES the holding companies are legally entitled to The Board of Governors has informed bank continue their affected nonbank activities until holding companies that they should file by Sep- the 1980 deadline, many uncertainties may tember 30, 1979, divestiture plans required by cause delay and prevent timely processing of the Bank Holding Company Act to be effective late-filed plans or applications, even though the by the end of 1980, in order to avoid facing Federal Reserve will make every effort to significant prospects of forced sales to meet the process them expeditiously. statutory deadline. The divestiture deadline does not apply to The Bank Holding Company Act amend- nonbanking activities permanently grandfaments of 1970 provided that companies that thered under the 1970 amendments. These are became bank holding companies by virtue of subsidiaries that were held by bank holding the 1970 amendments (that is, one-bank holding companies on June 30, 1968, and have been companies) and that had acquired nonbank ac- held continuously since. tivities between June 30, 1968, and December 30, 1970, had until December 31, 1980, to (1) PROPOSED ACTIONS divest such nonbank activities or (2) get board approval to keep them. Alternatively, they could The Board of Governors has requested comment cease to be a bank holding company by divest- by January 29, 1979, on an initial set of proing their bank holdings by the end of 1980. posed regulations for consumer protection under There is no provision in the act for extending the Electronic Fund Transfer Act. The act, the December 31, 1980, deadline. The board which became law in November 1978, directs has consequently established September 30, the board to issue implementing regulations and 1979, as the date by which divestiture or reten- model disclosure clauses. The rules proposed tion plans should be filed to comply with the by the board would carry out sections of the act's deadline. act that become effective February 8, 1979. A suggested draft letter to the Reserve Banks Proposed regulations for other sections of the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

50 Federal Reserve Bulletin • January 1979 act that go into effect in May 1980 will be issued SYSTEM MEMBERSHIP: later. ADMISSION OF STATE BANK The board on January 2, 1979, invited public The following bank was admitted to membercomment on a wide range of questions bearing ship in the Federal Reserve System during the on disclosure to borrowers of the annual perperiod December 16, 1978, through January 15, centage rate (APR) required by the truth in 1979: lending law and its implementing Regulation Z. The APR expresses the cost to the consumer of borrowing money and paying for purchases Colorado Westcliffe Custer County Bank on credit. The board requested comment by March 5, 1979. The board on December 28, 1978, proposed regulatory rules to implement new legislation NEW BOARD PUBLICATION to tighten restraints on lending by member banks to insiders. At the same time, the board pro- The 1977 Consumer Credit Survey is now posed simplification of Regulation O (Loans to available for distribution. This study presents Executive Officers of Member Banks), which the first comprehensive analysis of information would be amended by the proposals. The board obtained in a nationwide survey of nearly 2,600 requested comment on the proposals by January households conducted under contract by the 29, 1979. Survey Research Center, Institute for Social The Federal Reserve Board has made public Research, University of Michigan, in August a summary of the issues involved in a proposal and September 1977. The Federal Deposit Inby the New York Clearing House Association surance Corporation and the Office of the to establish an international banking facility Comptroller of the Currency joined the Federal (IBF) in New York City. The proposal seeks Reserve Board of Governors in sponsoring the an exemption from reserve requirements and fieldwork. interest rate ceilings for funds maintained with The Survey, by Professor Thomas A. Durkin the IBF. The board invited comment by March of Pennsylvania State University with the as- 15, 1979. sistance of Gregory E. Elliehausen, tabulates consumers' knowledge of credit laws and use of credit. It first examines survey questions and NEW CONSUMER PUBLICATION findings about consumer awareness, under- A 4'Consumer Handbook to Credit Protection standing, attitudes, and behavior regarding Laws," the latest in a series of consumer edu- credit and its regulation, with particular attencation publications, is now available for distri- tion to the Truth in Lending Act, unfair practices bution. and complaints, the Equal Credit Opportunity The handbook explains consumer rights under Act, the Fair Credit Billing Act, credit insurthe major credit protection laws and how bor- ance, and consumer attitudes toward credit and rowers can use them to shop for credit, apply creditors. The publication also provides inforfor it, keep up credit standings, and complain mation about credit use and credit users; reviews about possible abuses. It also points out the patterns of consumers' debts, income, and laws' solutions to credit practices that have been assets; and updates many tables from earlier used in the past to discriminate against women Surveys of Consumer Finances undertaken by and minorities. the Survey Research Center. Copies of the "Consumer Handbook to Credit Copies of the Survey may be obtained from Protection Laws" may be obtained singly or in Publications Services, Division of Support bulk free of charge from the Board of Governors Services, Board of Governors of the Federal in Washington or from any of the 12 Federal Reserve System, Washington, D.C. 20551. The Reserve Banks. price is $2.00 per copy. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

51 Record of Policy Actions of the Federal Open Market Committee MEETING HELD ON NOVEMBER 21, 1978 1. Domestic Policy Directive The information reviewed at this meeting suggested that output of goods and services was continuing to grow at a moderate pace in the current quarter, following expansion at an annual rate of 3.4 per cent in the third quarter and a somewhat faster rate on the average over the first two quarters of the year. Average prices, as measured by the fixed-weight price index for gross domestic business product, appeared to be continuing their rapid rise, about in line with the annual rate of IV2 per cent estimated for the third quarter. Staff projections of growth in output over the year ending in the third quarter of 1979 had been reduced from those of a month earlier. They now suggested a further slowing of expansion, in large part because of a reduction next year in the rise of business fixed investment and a decline in residential construction activity. The projections continued to suggest a rapid rise in average prices. The unemployment rate was expected to increase slightly from its October level. In October the index of industrial production rose an estimated 0.5 per cent, the same as in September but somewhat below the average advance since last winter. Nonfarm payroll employment rose considerably in October following relatively small advances during the third quarter. In manufacturing, employment gains were the largest of the year and the average workweek edged up. The unemployment rate declined from 6.0 to 5.8 per cent. Total private housing starts remained above an annual rate of 2 million units in September. However, sales of new units declined for the fourth consecutive month, and merchant-builder inventories of unsold single-family homes rose further. Sales of existing dwellings remained at an advanced level. The dollar value of total retail sales declined somewhat in Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

52 Federal Reserve Bulletin • January 1979 October following a sizable gain in August and a further advance in September. On balance, retail sales were modestly above their April level and slightly above their average in the third quarter. Unit sales of new automobiles increased in October but were still lower than in most other months since early spring. The index of average hourly earnings of private nonfarm production workers increased at an annual rate of about 9 per cent in October; for the first 10 months of 1978 the advance was at a rate of 8.4 per cent, about 1 percentage point above the rise over 1977 as a whole. Total hourly compensation of nonfarm workers was estimated to have increased at an annual rate of nearly 10 per cent over the first three quarters of the year, about 13A percentage points faster than in 1977. Average producer prices of finished goods rose substantially in October for the second consecutive month, reflecting in part a further large increase in producer prices of food products. In September the consumer price index rose at an annual rate of nearly 10 per cent following 2 months of somewhat smaller increases. On October 24 the Government announced a new program aimed at moderating increases in prices and wages. The program included explicit numerical standards for price and wage increases, with voluntary compliance encouraged by a number of Government measures; procedures to minimize the inflationary impact of Government regulations; and a restrictive budget policy. On November 1 a broad Government program was put in place to strengthen the dollar in foreign exchange markets and thereby to counter continuing domestic inflationary pressures. As part of this program the Federal Reserve announced the following actions: an increase in the discount rate from 8V2 to 9V2 per cent; establishment of a supplementary reserve requirement of 2 per cent against member bank time deposits in denominations of $100,000 or more; and increases in its reciprocal currency arrangements with the central banks of Germany, Japan, and Switzerland, and activation of the swap arrangement with the Bank of Japan. The U.S. Treasury announced related measures to mobilize key foreign currencies, including drawings on the U.S. reserve tranche in the International Monetary Fund; sales of special drawing rights; and issuance of foreign-currency-denominated securities. The Treasury also announced an increase in its monthly gold sales. The expanded Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 53 availability of foreign currencies was to be used in a program of forceful intervention in exchange markets, coordinated with foreign central banks, to correct recent excessive exchange-rate movements. In foreign exchange markets the trade-weighted value of the dollar against major foreign currencies declined substantially further during the last week of October, following large cumulative losses over recent months. After the announcement and initial implementation of the new support program on November 1, however, the dollar rose sharply—to a level somewhat above that in early October. The U.S. trade deficit in the third quarter was about unchanged from the second quarter. In October the expansion of total credit at U.S. commercial banks slowed slightly from the pace in the third quarter. Bank loans other than security loans continued to grow rapidly, but bank investments were reduced somewhat. Outstanding commercial paper of nonfinancial businesses rose considerably in October, after having changed little on balance during the previous 2 months. The narrowly defined money supply (M-l) grew at an annual rate of about 3lA per cent in October, after having expanded at rates of about 8V2 and 14 per cent in August and September, respectively; growth in M-2 and M-3 also moderated. Inflows of the interest-bearing deposits included in the broader aggregates slowed somewhat, although sales of 6-month money market certificates at both commercial banks and nonbank thrift institutions expanded sharply. At its meeting on October 17, the Committee had agreed that early in the coming inter-meeting period operations should be directed toward a Federal funds rate of around 9 per cent, slightly above the rate of 834 per cent then prevailing. Subsequently, the objective for the Federal funds rate was to be raised or lowered in an orderly fashion within a range of 83A to 9% per cent. In setting a specific objective for the funds rate within that range, the Manager of the System Open Market Account was to be guided mainly by a range of tolerance of 516 to 9Vi per cent for the annual rate of growth in M-2 over the October-November period, provided that the rate of growth in M-l over that period did not exceed 6V2 per cent. Immediately following the October 17 meeting the Manager began to seek reserve conditions consistent with a weekly average Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

54 Federal Reserve Bulletin • January 1979 Federal funds rate of around 9 per cent. However, because a sizable short-term need for reserves coincided with temporary market scarcities of Treasury obligations for collateral behind System repurchase agreements, Federal funds traded at around 9lA per cent. As October progressed, the Manager did not take aggressive action to exert downward pressure on the funds rate, in light of conditions in foreign exchange markets and of the Committee's related instruction to give due regard to such developments. Accordingly, Federal funds continued to trade at around 9*4 per cent in the days prior to November 1. As part of the Government program announced on November 1, the Committee had voted on October 31 to delegate authority to Chairman Miller to modify the domestic policy directive by raising the range for the Federal funds rate to 9V2 to 9% per cent and by instructing the Manager, in deciding on the specific objective for the rate within that range, to be guided by developing conditions in domestic and international financial markets; the Chairman approved the modification on November 1. During the first half of November, the Federal funds rate averaged in the upper half of that range. For several days immediately following the November 1 announcement, however, the rate was somewhat above the desired range as the Manager avoided aggressive action to reduce it during the initial stages of implementation of the new program. The rise in the Federal funds rate during the inter-meeting period was accompanied by substantial increases in yields on most shortterm market instruments. Advances in rates on Treasury bills were moderated, however, by large investments by foreign central banks of dollars obtained in currency support operations. Commercial banks increased the rate on loans to prime business borrowers from 10 per cent to 11 per cent during the period. Yields in bond markets advanced considerably during the second half of October, but a large portion of the increase was offset by sizable declines in early November. In mortgage markets, interest rates moved steadily higher over the inter-meeting period as demands for real estate credit remained strong. Residential mortgage lending apparently increased in October. In the Committee's discussion of the economic situation and outlook, most members indicated that over the past month they Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 55 had scaled down their expected rates of growth in real output of goods and services for the year ending in the third quarter of 1979. One or two members still anticipated moderate expansion over the period, but many projected slow growth, and some thought that a downturn in activity was likely or that the risks of an actual recession or a growth recession had increased. It was emphasized, however, that the uncertainties associated with any forecast of real output had increased significantly. Most members expected that, over the year ending in the third quarter of 1979, the unemployment rate either would change little or would increase from the average level in the third quarter of 1978. All members continued to anticipate a rapid rise in average prices of goods and services. The recent rise in short-term interest rates—specifically, its impact on the cost and possibly on the availability of mortgage credit—in addition to recent indications of a slowing next year in the rise of business fixed investment, was cited as one reason for reducing anticipated rates of growth in real output over the period ahead. On the other hand, the view was also expressed that the new program to strengthen the dollar and to counter inffationary pressures could have favorable effects on expectations, especially on those for inflation, and thereby could encourage spending. In this connection, it was noted that long-term bond yields had declined immediately after the announcement on November 1. A difference in emphasis also existed with respect to Federal tax policy. Thus, it was suggested that prospects for sustaining the expansion in output had been improved by the recent enactment of reductions in income taxes. But it was also observed that the reductions would be largely offset by substantial increases in social security taxes in 1979. Some skepticism was expressed, as it had been at the October meeting, that growth in output could be tapered down to a relatively slow rate without bringing on a recession, especially in view of the rapid inflation. It was stressed, on the other hand, that economic conditions in this period differed from those in other business expansions in ways that made it reasonable to expect a reduction in the rate of growth and a concomitant decrease in the rate of inflation without a slide into recession. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

56 Federal Reserve Bulletin • January 1979 At its meeting in October the Committee had agreed that from the third quarter of 1978 to the third quarter of 1979 growth of M-2 and M-3 within ranges of 6V2 to 9 per cent and IV2 to 10 per cent, respectively, appeared to be consistent with broad economic aims. M-l was expected to grow over that period within a range of 2 to 6 per cent, depending in part on the speed and extent of transfers from demand to savings deposits resulting from the introduction of the automatic transfer service (ATS). The associated range for the rate of growth in commercial bank credit was 8V2 to IIV2 per cent. The Committee had also decided that growth of M-1+ within a range of 5 to IV2 per cent appeared to be generally consistent with the ranges of growth for the other monetary aggregates. It had been agreed that the longer-run ranges, as well as the particular aggregates for which such ranges were specified, would be subject to review and modification at subsequent meetings. In the discussion of policy for the period immediately ahead, the members of the Committee agreed that, in seeking to achieve bank reserve and money market conditions broadly consistent with the longer-run ranges for monetary growth cited above, due regard should be given to the program for supporting the foreign exchange value of the dollar as well as to developing conditions in domestic financial markets and to uncertainties associated with the November 1 introduction of ATS. Against that background, the members differed somewhat in their views as to whether, and to what degree, additional firming in money market conditions should be sought during the next few weeks; no sentiment was expressed for easing money market conditions. As they had at the October meeting, moreover, most members favored giving greater weight than usual to money market conditions in the conduct of operations in the period before the next meeting, although some sentiment was expressed for a return to basing decisions for open market operations primarily on the behavior of the monetary aggregates. The members favored directing open market operations early in the period before the next regular meeting toward maintaining the weekly-average Federal funds rate at 93A per cent, the upper end of the 9V2 to 93/4 per cent range specified as of November 1, or slightly higher. With respect to the range in which the funds rate might be varied if growth in the aggregates appeared to approach Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 57 or move beyond their specified limits, most members favored an upper limit of 10 per cent for the range; lOVs and 10^ per cent were also proposed. Lower limits from 9Vi to 93A per cent were suggested. With respect to the monetary aggregates, almost all members proposed that the Committee take account of the unusual uncertainties associated with the introduction of ATS in the same way that it had at the October meeting—namely, by giving primary emphasis to growth of M-2 and by specifying only an upper limit, rather than a range, for growth of M-l. For the annual rate of growth in M-2 over the November-December period, most members favored a range with a lower limit of 6 per cent and an upper limit of 9 to 10 per cent. Almost all members proposed 5 or 5V2 per cent for the ceiling on growth of M-l over the 2-month period. At the conclusion of the discussion the Committee agreed to instruct the Manager to seek a Federal funds rate of around 9% per cent early in the period before the next regular meeting and subsequently to maintain the rate within a narrow band of 9% to 10 per cent. With regard to the specific objective for the rate within that range, the Committee instructed the Manager to be guided mainly by a range of tolerance for the annual rate of growth in M-2 over the November-December period of 6 to 9Vi per cent, provided that the rate of growth in M-l over that period did not exceed 5 per cent. It was understood that the Chairman might call upon the Committee to consider the need for supplementary instructions before the next scheduled meeting if significant inconsistencies appeared to be developing among the Committee's objectives. The following domestic policy directive was issued to the Federal Reserve Bank of New York: The information reviewed at this meeting suggests that in the current quarter real output of goods and services is continuing to grow moderately. In October industrial production expanded further, nonfarm payroll employment rose considerably, and the unemployment rate declined from 6.0 to 5.8 per cent. Following 2 months of gains, the dollar value of total retail sales declined somewhat to a level slightly above the average in the third quarter. Average producer prices of finished goods rose substantially in October, as in September, in part because of further large increases in prices of foods. The advance in the index of average hourly earnings has Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

58 Federal Reserve Bulletin • January 1979 been somewhat faster so far in 1978 than it was on the average during 1977. In late October the Government announced a new program aimed at moderating increases in prices and wages. On November I a broad program to strengthen the dollar in foreign exchange markets and thereby to counter continuing domestic inflationary pressures was announced. The program included an increase in Federal Reserve discount rates from 8V2 to 9l/i per cent, establishment of a supplementary reserve requirement of 2 per cent against member bank time deposits in denominations of $100,000 or more, increases in Federal Reserve reciprocal currency arrangements with certain central banks, and other measures to mobilize key foreign currencies. The trade-weighted value of the dollar against major foreign currencies declined rapidly during the last week of October, but following the actions taken to strengthen the dollar, it rose sharply to a level somewhat above that in early October. The U.S. trade deficit was about the same in the third quarter as in the second quarter. Growth in M-l, which had been rapid in August and September, slowed markedly in October, and growth in M-2 and M-3 also moderated. Inflows of the interest-bearing deposits included in the broader aggregates slowed somewhat, although sales of 6-month money market certificates at both commercial banks and nonbank thrift institutions expanded to record levels. Short-term market interest rates have risen substantially further since mid-October. Bond rates also have increased on balance, although they have declined appreciably since November 1; mortgage interest rates have continued to rise. In light of the foregoing developments, it is the policy of the Federal Open Market Committee to foster monetary and financial conditions that will resist inflationary pressures while encouraging continued moderate economic expansion and contributing to a sustainable pattern of international transactions. At its meeting on October 17, 1978, in setting ranges for the monetary aggregates, the Committee recognized the uncertainties concerning the effects that the November 1 introduction of the automatic transfer service (ATS) would have on measures of the money supply, especially M-l. Against that background, the Committee agreed that appropriate monetary and financial conditions would be furthered by growth of M-2 and M-3 from the third quarter of 1978 to the third quarter of 1979 within ranges of 6V2 to 9 per cent and 7l/2 to 10 per cent, respectively. The narrowly defined money supply (M-l) was expected to grow within a range of 2 to 6 per cent over the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 59 period, depending in part on the speed and extent of transfers from demand to savings deposits resulting from the introduction of ATS. The associated range for bank credit is 8V2 to IIV2 per cent. Growth of M-l + (M-l plus savings deposits at commercial banks and NOW accounts) in a range of 5 to ll/i per cent was thought to be generally consistent with the ranges of growth for the foregoing aggregates. These ranges are subject to reconsideration at any time as conditions warrant. In the short run, the Committee seeks to achieve bank reserve and money market conditions that are broadly consistent with the longer-run ranges for monetary aggregates cited above, while giving due regard to the program for supporting the foreign exchange value of the dollar, to developing conditions in domestic financial markets, and to uncertainties associated with the introduction of ATS. Early in the period before the next regular meeting, System open market operations are to be directed at attaining a weekly average Federal funds rate slightly above the current level. Subsequently, operations shall be directed at maintaining the weekly average Federal funds rate within the range of 93A to 10 per cent. In deciding on the specific objective for the Federal funds rate, the Manager is to be guided mainly by a range of tolerance for the annual rate of growth over the November-December period of 6 to 9Vi per cent in M-2, provided that the rate of growth in M-l does not appear to exceed 5 per cent. The objective for the funds rate is to be raised or lowered within its range if the rate of growth of M-2 appears to be close to or beyond the upper or lower limit of its range. Weight is to be given to M-l if it appears to be growing at a rate close to or above its limit. If the rates of growth in the aggregates appear to be falling outside the limits of the indicated ranges at a time when the objective for the funds rate has already been moved to the corresponding limit of its range, the Manager will promptly notify the Chairman, who will then decide whether the situation calls for supplementary instructions from the Committee. Votes for this action: Messrs. Miller, Volcker, Baughman, Coldwell, Eastburn, Partee, Mrs. Teeters, Messrs. Wallich, Willes, and Winn. Votes against this action: None. Subsequent to the meeting, on December 8, nearly final estimates indicated that in November M-l had declined and M-2 had ex- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 60 Federal Reserve Bulletin • January 1979 panded at a slow pace. For the November-December period, staff projections suggested that the annual rates of growth in M-l and M-2 would be about lA per cent and 6lA per cent, respectively; for M-2, the projected rate was close to the lower limit of the 6 to 9Vi per cent range specified by the Committee. During recent weeks the Federal funds rate had averaged about 9% per cent. In light of the behavior of the aggregates, the Manager might, under normal circumstances, have sought to reduce the funds rate to about the 93A per cent lower limit of its specified range. Given current circumstances, however, Chairman Miller recommended that the Manager be instructed to continue to aim for a Federal funds rate of about 9% per cent during the period before the next regular meeting of the Committee, unless growth of the aggregates appeared to weaken significantly further. On December 8, 1978, the Committee modified the domestic policy directive adopted at its meeting of November 21, 1978, to call for open market operations directed at maintaining the Federal funds rate at about the prevailing level of 9% per cent during the period before the next meeting unless growth of the aggregates appeared to weaken significantly further. Votes for this action: Messrs. Miller, Baughman, Cold well, Eastburn, Partee, Mrs. Teeters, Messrs. Wallich, Willes, Winn, and Timlen. Votes against this action: None. Absent and not voting: Mr. Volcker. (Mr. Timlen voted as alternate for Mr. Volcker.) 2. Authorization for Foreign Currency Operations At its meeting of March 21, 1978, the Committee had reaffirmed an agreement with the Treasury under which the Federal Reserve would undertake to "warehouse" foreign currencies held by the Exchange Stabilization Fund (ESF)—that is, to make spot purchases of foreign currencies from the ESF and simultaneously to make forward sales of the same currencies at the same exchange rate to the ESF—if that should prove necessary to enable the ESF to deal with potential liquidity strains. Specifically, the Committee had agreed that the Federal Reserve would be prepared, if requested by the Treasury, to warehouse up to $IV2 billion of eligible foreign Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Record of Policy Actions of the FOMC 61 currencies, of which half would be for periods of up to 12 months and half for periods of up to 6 months. On December 14, 1978, the Committee amended paragraph 1A of the authorization for foreign currency operations to provide for transactions in foreign currencies directly with the U.S. Treasury as well as with the ESF. Concurrently, the Committee agreed to raise the amount of eligible foreign currencies that the Federal Reserve would be prepared to warehouse to $13A billion at this time. These actions were taken in view of the first issuance of Treasury securities denominated in foreign currencies as one of the measures announced on November 1 in implementation of the broad program to strengthen the dollar and thereby to counter continuing domestic inflationary pressures. The Treasury was scheduled to receive payment of somewhat more than $1V2 billion equivalent of German marks on December 15, 1978. As amended, paragraph 1A read as follows: 1. The Federal Open Market Committee authorizes and directs the Federal Reserve Bank of New York, for System Open Market Account, to the extent necessary to carry out the Committee's foreign currency directive and express authorizations by the Committee pursuant thereto, and in conformity with such procedural instructions as the Committee may issue from time to time: A. To purchase and sell the following foreign currencies in the form of cable transfers through spot or forward transactions on the open market at home and abroad, including transactions with the U.S. Treasury, with the U.S. Exchange Stabilization Fund established by Section 10 of the Gold Reserve Act of 1934, with foreign monetary authorities, with the Bank for International Settlements, and with other international financial institutions: Austrian schillings Italian lire Belgian francs Japanese yen Canadian dollars Mexican pesos Danish kroner Netherlands guilders Pounds sterling Norwegian kroner French francs Swedish kronor German marks Swiss francs Votes for this action: Messrs. Miller, Volcker, Baughman, Cold well, Eastburn, Partee, Mrs. Teeters, Messrs. Wallich, Willes, and Winn. Votes against this action: None. Records of policy actions taken by the Federal Open Market Committee at each meeting, in the form in which they will appear in the Board's Annual Report, are released about a month after the meeting and are subsequently published in the BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

63 Law Department Statutes, regulations, interpretations, and decisions INTEREST ON DEPOSITS viously advised that interest becomes part of the underlying principal when it is credited or posted The Board of Governors has amended its provito the depositor's account. Under this position, sion of Regulation Q concerning penalty for early where a depositor is permitted to make an early withdrawals. withdrawal of time deposit funds, the depositor Effective December 6, 1978, Regulation Q is will incur an early withdrawal penalty pursuant amended by adding the following two sentences to section 217.4(d) on all of the funds withdrawn as a new paragraph at the end of § 217.4(d)(3) to the extent that the amount withdrawn reflects as follows: the original principal and any earned interest that has been credited or posted to the account. SECTION 217.4—PAYMENT OF TIME DEPOSITS (b) The Board does not believe that the fre- BEFORE MATURITY. quency of compounding or the method of crediting or posting interest to the account is necessarily determinative of when interest should be viewed (d) Penalty for early withdrawals. * * * as part of the underlying principal for purposes (3) * * * of application of the Regulation Q early with- Under a time deposit agreement where subsequent drawal restrictions. Adoption of such a position deposits reset the maturity of the entire account,, is unnecessary to effectuate the purposes of interest each deposit maintained in the account for at least rate control, including the prohibition against paya period equal to the original maturity of the ment of interest on demand deposits. In addition, deposit may be regarded as having matured indi- the Board notes that the outstanding position that vidually and been redeposited at intervals equal interest becomes part of the underlying principal to such period. When a time deposit is payable when credited or posted to the account and, thus, only after notice, for funds on deposit for at least is subject to Regulation Q early withdrawal rethe notice period, the penalty for early withdrawal strictions, places member banks at a competitive shall be imposed for at least the notice period. disadvantage with respect to nonmember insured commercial banks that are permitted to pay accrued interest on a time deposit at anytime during 4s M< 5k * the initial term of the deposit contract. Interpretation of Regulation Q (c) In view of the above considerations, the Board has concluded that a member bank may The Board of Governors has issued an interprepermit a depositor to withdraw the interest earned tation regarding the treatment of interest earned on a time deposit at any time before maturity, on time deposit funds for purposes of the Board's irrespective of the method that the bank uses to Regulation Q. compound or credit (post) interest to the deposi- Effective December 6, 1978, Section 217.154 tor's account. The Board has concluded, however, is added to read as follows: thai if a time deposit is renewed upon its original maturity or if a depositor takes action to extend SECTION 217.154— the maturity of the time deposit during the original WITHDRAWAL OF INTEREST maturity period, interest earned to the date of (a) The Board has been asked to review the renewal or extension, unless withdrawn, must be question of when interest earned on a time deposit viewed as part of principal subject to Regulation becomes part of the principal deposit for purposes Q withdrawal restrictions. of the early withdrawal penalty requirements con- (d) This interpretation does not affect the treattained in section 217.4(d) of Regulation Q. As ment of interest as principal for purposes of asnoted in the requests, the Board's staff has pre- sessing required reserves under Regulation D (12 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 64 Federal Reserve Bulletin • January 1979 CFR § 204). For purposes of determining required graphs (f) and (g) of this section govern other reserves, interest that has been credited or posted international operations of bank holding compato a time deposit account will continue to be nies. viewed as a deposit on which reserves must be (2) Acquisition of going concern. A bank maintained at the appropriate time deposit level. holding company may apply to the Board to acquire or retain the assets of or shares in a company * * * ** engaged solely in activities described in paragraph (a) of this section by filing an application with BANK HOLDING COMPANIES its Reserve Bank (Form F.R. Y-4). The Board will RULES REGARDING DELEGATION publish in the Federal Register a notice of any OF AUTHORITY such application and will give interested persons an opportunity to express their views (including, The Board of Governors has adopted two related where appropriate, by means of a hearing) on the amendments to its Regulation Y and its Rules question whether performance of the activity pro- Regarding Delegation of Authority. posed by the holding company can reasonably be 1. Effective January 1, 1979, as to applications expected to produce benefits to the public, such accepted by any Federal Reserve Bank on or after as greater convenience, increased competition or that date, section 225.4 of the Board's Regulation gains in efficiency, that outweigh possible adverse Y is amended by revising subparagraphs (b)(1) and effects, such as undue concentration of resources, (b)(2) to read as follows: decreased or unfair competition, conflicts of inter- (b)(1) De novo entry. A bank holding com- ests, or unsound banking practices. pany may engage de novo (or continue to engage 2. Effective January 1, 1979, as to applications in an activity earlier commenced de novo), directly accepted by any Federal Reserve Bank on or after or indirectly, solely in activities described in parathat date, section 265.2 of the Board's Rules graph (a) of this section, 45 days after the company Regarding Delegation of Authority is amended by has furnished its Reserve Bank a notice of the revising paragraph (f)(20) of that section to read proposal (in substantially the same form as F.R. as follows: Y-4A), unless the company is notified to the con- (f) Each Federal Reserve Bank is authorized, trary within that time or unless it is permitted to as to member banks or other indicated organiconsummate the transaction at an earlier date on zations headquartered in its district: the basis of exigent circumstances of a particular case. The Board will publish in the Federal Register notice of any such proposal and will give interested persons an opportunity to express their (20) Under § 225.4(b)(1) of this chapter views on the proposal to the Reserve Bank. If (Regulation Y), and subject to § 265.3 if a person adverse comments of a substantive nature are submitting adverse comments that the Reserve received within the time specified in the notice,12 Bank has decided are not substantive files a petior if it otherwise appears appropriate in a particular tion for review by the Board of that decision, case, the Reserve Bank may inform the company (i) to permit a bank holding company to that (i) the proposal shall not be consummated until engage de novo in activities specified in § 225.4(a) specifically authorized by the Reserve Bank or by (or retain shares in a company established de novo the Board or (ii) the proposal should be processed and engaging in such activities) if its evaluation in accordance with the procedures of subparagraph of the considerations specified in section 4(c)(8) (2) of this paragraph. With respect to activities of the Bank Holding Company Act leads it to to be engaged in outside the United States, the conclude that the proposal can reasonably be exprocedures of this subparagraph apply solely to pected to produce benefits to the public. activities to be engaged in directly by a domestic (ii) to notify a bank holding company that bank holding company or by domestic nonbank the proposal should not be consummated until subsidiaries of any bank holding company. Paraspecifically authorized by the Reserve Bank or by the Board or that the proposal should be processed 12 If a Reserve Bank decides that adverse comments are in accordance with the procedures of not of a substantive nature, the person submitting the comments § 225.4(b)(2). may request review by the Board of that decision in accordance with the provisions of § 265.3 of the Board's Rules Regarding (iii) to permit a bank holding company to Delegation of Authority (12 CFR 265.3) by filing a petition for review with the Secretary of the Board. consummate the proposal before the expiration of Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 65 the 45-day period referred to in §225.4(b)(1), serve Bank and seven hundred fifty thousand dolbecause exigent circumstances justify consumma- lars ($750,000) for all Reserve Banks in the Systion at an earlier time. tem. Rules Regarding Delegation of Authority RULES OF ORGANIZATION The Secretary of the Board of Governors has The Secretary of the Board of Governors has approved a technical and conforming amendment approved an amendment to the Board's Rules of to the Board's Rules Regarding Delegation of Organization to reflect recent organizational Authority to reflect recent organizational changes. changes. Effective October 17, 1978, section 265.2(j) is Effective November 1, 1978, section 3 of the deleted and section 265.2(d) is amended as fol- Rules of Organization is amended as follows: lows: SECTION 3—CENTRAL ORGANIZATION. SECTION 265.2—SPECIFIC FUNCTIONS DELE- The Board's central organization consists of the GATED TO BOARD EMPLOYEES AND TO FEDERAL following Offices, Divisions and officials: RESERVE BANKS. (b) Office of Staff Director for Monetary and (d) The Staff Director for Federal Reserve Bank Financial Policy is responsible for Federal Open Activities or the Staff Director's designee is au- Market Committee staff activities; preparation of thorized: proposals on monetary policy instruments including discount rates and reserve requirements; coordination of staff work on regulatory and super- (3) Under the provisions of the third paragraph visory issues closely related to domestic and of section 16 of the Federal Reserve Act (12 international monetary and financial policies and U.S.C. 413), to apportion credit among the Rethe functioning of domestic and international serve Banks for unfit notes that are destroyed, money and capital markets; coordination with the giving consideration to the net number of notes System Account Manager on domestic open marof each denomination that were issued by each ket activities and with the System Account Man- Reserve Bank during the preceding calendar year. ager and the Treasury on foreign exchange market (4) Under the provision of §§ 216.5(b), activities; coordination of analysis and develop- 216.5(d), and 216.6 of this chapter (Regulation ment of options for Board consideration with re- P), with respect to Federal Reserve Banks and gard to foreign exchange policies and the internabranches tional payments mechanism; Euro-dollar and in- (i) to require reports on security devices; ternational banking policy issues; coordination of (ii) to require special reports; and System statistical programs related to monetary (iii) to determine in view of the provisions of and financial policy operations; and appropriate §§ 216.3 and 216.4 whether security devices and staff coordination with other government agencies procedures are deficient in meeting the requireand with private groups in these areas. ments of Part 216, to determine whether such requirements should be varied in the circumstances BANK HOLDING COMPANY AND BANK of a particular banking office, and to require cor- MERGER ORDERS ISSUED BY THE BOARD OF rective action. GOVERNORS (5) To approve or disapprove supplementary budget requests and special incentive programs to Orders Under Section 3 improve operations or reduce costs, provided that of Bank Holding Company Act the Board has previously approved the budget of the requesting Reserve Bank and provided that the Commerce Southwest Inc., supplemental request adheres to the Board's gen- Dallas, Texas eral expense guidelines and such guidelines as the Order Approving Board may have imposed in approving the Reserve Formation of Bank Holding Company Bank's budget and provided that the amount approved may not exceed in any budgetary year one Commerce Southwest Inc., Dallas, Texas, has hundred thousand dollars ($100,000) for each Re- applied for the Board's approval under section Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 66 Federal Reserve Bulletin • January 1979 3(a)(1) of the Bank Holding Company Act (12 banking organizations, consummation of the pro- U.S.C. § 1842(a)(1)) of formation of a bank posal would have no adverse effects on existing holding company by acquiring 100 percent (less or potential competition, nor would it increase the directors' qualifying shares) of the voting shares concentration of banking resources in the relevant of the successor by merger to National Bank of banking market. Accordingly, the Board con- Commerce of Dallas, Dallas, Texas ("Bank").1 cludes that competitive considerations are consist- The bank into which Bank is to be merged has ent with approval of the application. no significance except as a means to facilitate the The managerial resources of Applicant and acquisition of the voting shares of Bank. Accord- Bank are regarded as satisfactory, and consummaingly, the proposed acquisition of shares of the tion of the proposal would strengthen the financial successor organization is treated herein as the resources of Bank. Furthermore, the Board notes proposed acquisition of the shares of Bank. that the overall position and operations of Bank Notice of the application, affording opportunity have improved since its present management asfor interested persons to submit comments and sumed responsibility for the operation of Bank in views, has been given in accordance with section 1974. Therefore, considerations relating to bank- 3(b) of the Act. The time for filing comments and ing factors are consistent with approval of the views has expired, and the Board has considered application. the application and all comments received in light Although Applicant does not propose any imof the factors set forth in section 3(c) of the Act mediate changes in Bank's services, convenience (12 U.S.C. § 1842(c)). and needs considerations are consistent with ap- Applicant, a nonoperating corporation with no proval of the application. Accordingly, it is the subsidiaries, was formed for the purpose of be- Board's judgment that the proposed acquisition is coming a bank holding company through the ac- consistent with public interest and that the appliquisition of Bank. Bank, with total deposits of cation should be approved. $248.6 million is the 24th largest bank in Texas, On the basis of the record, the application is holding 0.41 percent of total deposits in commer- approved for the reasons summarized above. The cial banks in the state.2 Upon acquisition of Bank, transaction shall not be made before the thirtieth Applicant would control the sixth largest bank in calendar day following the effective date of this the relevant banking market and 2.2 percent of Order or later than three months after the effective total deposits therein.3 The proposal represents a date of this Order, unless such period is extended restructuring of the ownership of Bank, and since for good cause by the Board, or by the Federal Applicant has no other banking subsidiaries 4 and Reserve Bank of Dallas pursuant to delegated Applicant's principals do not control any other authority. By order of the Board of Governors, effective December 22, 1978. 1 Upon consvimmation of the proposal, Applicant will also acquire control of certain companies that engage in nonbanking Voting for this action: Governors Wallich, Coldwell, activities that are impermissible for a bank holding company. Partee, and Teeters. Absent and not voting: Chairman Under section 4(a)(2) of the Act these activities may not be retained beyond two years from the date Applicant becomes Miller. a bank holding company. Applicant has committed to the Board that it will divest these impermissible activities within the (Signed) GRIFFITH L. GARWOOD, two-year period. 2 All banking data are as of December 31, 1977, and reflect [SEAL] Deputy Secretary of the Board. bank holding company formations and acquisitions approved as of August 31, 1978. 3 The relevant banking market is approximated by the Dallas RMA. 4 The Board notes that upon acquisition of Bank, Applicant Arkansas Best Corporation, will be deemed to control the shares of three banks, including Dallas/Fort Worth Airport National Bank ("Airport Bank"), Fort Smith, Arkansas which were acquired by Bank in 1975 in satisfaction of debts previously contracted. In 1977 Bank transferred the shares of Order Approving each such bank to various transferees who were indebted to Bank, and under section 2(g)(3) of the Act, Bank is deemed Acquisition of Shares of Bank Holding Company to control the shares of the banks transferred. Inasmuch as section 3(a)(A)(i) of the Act requires Bank to divest control Arkansas Best Corporation, Fort Smith, Arof such shares on December 29, 1978, with respect to Airport Bank and on March 9, 1979, with respect to the other two kansas, a bank holding company within the meanbanks, Applicant has not filed applications for the acquisition of any of these banks. Furthermore, Applicant has committed ing of the Bank Holding Company Act, with that it will cause Bank to file with the Board a request for respect to National Bank of Commerce of Dallas a determination under section 2(g)(3) of the Act that Bank is not capable of controlling Airport Bank. ("Bank"), Dallas, Texas, has applied for the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 67 Board's approval under section 3(a)(3) of the Act for good cause by the Board, or by the Federal (12 U.S.C. § 1842(a)(3)) to acquire an indirect Reserve Bank of Dallas pursuant to delegated interest in Bank by exchanging the shares of Bank authority. it now holds for 11.7 percent of the voting shares By order of the Board of Governors, effective of Commerce Southwest Inc., Dallas, Texas December 22, 1978. ("Commerce").1 Voting for this action: Governors Wallich, Coldwell, Notice of the application, affording opportunity Partee, and Teeters. Absent and not voting: Chairman for interested persons to submit comments and Miller. views, has been given in accordance with section 3(b) of the Act. The time for filing comments and (Signed) GRIFFITH L. GARWOOD, views has expired, and the Board has considered [SEAL] Deputy Secretary of the Board. the application and all comments received in light of the factors set forth in section 3(c) of the Act First Michigan Bank Corporation, (12 U.S.C. § 1842(c)). Commerce has been formed to effectuate a cor- Zeeland, Michigan porate reorganization of Bank, in which Applicant Order Approving Acquisition of Bank holds an 11.7 percent interest. In connection with this corporate reorganization, Applicant proposes First Michigan Bank Corporation, Zeeland, to change its direct ownership of shares of Bank Michigan, a bank holding company within the to indirect ownership of shares of Bank through meaning of the Bank Holding Company Act, has ownership of shares of Commerce. Inasmuch as applied for the Board's approval under section Applicant's proposed acquisition of voting shares 3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to of Commerce is merely a restructuring of Appli- acquire all of the voting shares (less directors' cant's interest in Bank, the acquisition would have qualifying shares) of the successor by merger to no adverse effects on competition. Furthermore, National Lumberman's Bank and Trust Company, since Applicant's proportionate interest in Bank Muskegon, Michigan ("Bank"). The bank into would not be altered, considerations relating to the which Bank is to be merged has no significance financial and managerial resources of Applicant except as a means to facilitate the acquisition of and Bank, as well as considerations relating to the shares of the successor organization is treated convenience and needs of the community to be herein as the proposed acquisition of the shares served, are regarded as consistent with approval of Bank. of the application. Accordingly, it is the Board's Notice of the application, affording opportunity judgment that the proposed transaction would be for interested persons to submit comments and consistent with the public interest and that the views, has been given in accordance with § 3(b) application should be approved. of the Act. The time for filing comments and views On the basis of the record, the application is has expired, and the Board has considered the approved for the reasons summarized above. The application and all comments received in light of transaction shall not be made before the thirtieth the factors set forth in § 3(c) of the Act (12 U.S.C. calendar day following the effective date of this § 1842(c)). Order or later than three months after the effective Applicant, the 27th largest banking organization date of this Order, unless such period is extended in Michigan, controls three banking subsidiaries with aggregate deposits of approximately $188.8 1 Applicant became a bank holding company as a result of million, representing 0.5 percent of total commerthe 1970 Amendments to the Act by virtue of its ownership cial bank deposits in the state.1 Acquisition of of approximately 65 percent of the shares of Bank. On August 3, 1971, pursuant to § 4(c)(12) of the Act and § 225.4(d) of Bank ($137.1 million in deposits) would increase the Board's Regulation Y, Applicant filed an irrevocable de- Applicant's share of statewide commercial bank claration that it will cease to be a bank holding company on or before December 31, 1980. Applicant has reduced its deposits by approximately 0.4 percent and would ownership of Bank to approximately 11.7 percent and no longer not have an appreciable effect upon the concentraparticipates in the active management of Bank. While the Board has stated that applications to expand banking activities tion of banking resources in Michigan. under § 3 of the Act are not generally appropriate for compa- Bank is the second largest of seven banking nies that have filed § 4(c)(12) declarations, Applicant will not increase its proportionate interest in Bank, and the shares of organizations in the Muskegon/Grand Haven Bank held by Applicant are the subject of a binding contract that will effectuate divestiture of all of Applicant's interest in Bank by December 31, 1980 (The Jacobus Company, 58 1 All banking data are as of December 31, 1977, and reflect FEDERAL RESERVE BULLETIN 306 (1972) and Archer-Daniels- bank holding company formations and acquisitions approved Midland Company, 61 FEDERAL RESERVE BULLETIN (1975)). as of November 30, 1978. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 68 Federal Reserve Bulletin • January 1979 banking market (the relevant market),2 and con- M.S.B. Agency, Inc., trols approximately 22.5 percent of the total de- St. Paul, Minnesota posits in commercial banks in the market. Since Order Denying acquisition of Bank would represent Applicant's Formation of Bank Holding Company initial entry into the Muskegon/Grand Haven banking market, upon consummation of the pro- M.S.B. Agency, Inc., St. Paul, Minnesota, has posal no significant existing competition would be applied for the Board's approval under section eliminated between Bank and any of Applicant's 3(a)(1) of the Bank Holding Company Act (12 subsidiary banks. Applicant could enter the market U.S.C. § 1842(a)(1)) of formation of a bank by establishing a de novo subsidiary bank. How- holding company through acquisition of 85.1 perever, demographic data indicate that the market cent of the voting shares of Minnesota State Bank is not attractive for such entry by Applicant.3 of St. Paul, St. Paul, Minnesota ("Bank"). Accordingly, based upon the above and other facts Notice of the application, affording opportunity of record, the Board has determined that competifor interested persons to submit comments and tive considerations are consistent with approval of views, has been given in accordance with section the application. 3(b) of the Act. The time for filing comments and The financial and managerial resources and fu- views has expired, and the Board has considered ture prospects of Applicant, its subsidiaries and the application and all comments received in light Bank are regarded as generally satisfactory, par- of the factors set forth in section 3(c) of the Act ticularly in view of Applicant's commitment to (12 U.S.C. § 1842(c)). provide Bank with additional equity capital. Ac- Applicant, a nonoperating corporation with no cordingly, considerations relating to banking fac- subsidiaries, was organized for the purpose of tors are consistent with approval of the application. becoming a bank holding company through acqui- Considerations relating to the convenience and sition of Bank, the 67th largest banking organineeds of the community to be served are regarded zation in Minnesota, which holds deposits of apas consistent with approval. It is the Board's proximately $25.3 million.1 Upon acquisition of judgment that consummation of the transaction Bank, Applicant would control about 0.1 percent would be in the public interest and that the appli- of total deposits in commercial banks in the state. cation should be approved. Bank is the 33rd largest of 113 banking organi- On the basis of the record, the application is zations in the relevant banking market,2 and conapproved for the reasons summarized above. The trols 0.3 percent of total market deposits. While transaction shall not be consummated before the Applicant's principal is also a principal in several thirtieth calendar day following the effective date other banking organizations, none of these banking of this Order or later than three months after the organizations compete in the relevant banking effective date of this Order, unless such period market. Therefore, it appears that no competition is extended for good cause by the Board or by would be eliminated as a result of consummation the Federal Reserve Bank of Chicago acting pur- of this proposal. Moreover, inasmuch as the prosuant to delegated authority. posed transaction involves the transfer of owner- By order of the Board of Governors, effective ship of Bank from an individual and several cor- December 28, 1978. porations controlled by that individual to a single corporation owned by the individual, it appears Voting for this action: Governors Wallich, Coldwell, that consummation of this proposal would have Partee, and Teeters. Absent and not voting: Chairman no adverse effects upon existing or potential com- (Signed) GRIFFITH L. GARWOOD, petition, nor would it increase the concentration [SEAL] Deputy Secretary of the Board. of banking resources in the relevant market. Accordingly, the Board concludes that competitive 2 The Muskegon/Grand Haven banking market is approxi- considerations of the proposal are consistent with mated by Muskegon County, Michigan, except for Casnovia approval of the application. Township, plus the northwestern portions of Ottawa County, which includes the city of Grand Haven and adjacent townships. 3 In approving the application by Detroit Bank Corporation, Detroit, Michigan to acquire Lake Shore Financial Corpora- 1 All banking data are as of March 31, 1978, unless othertion, Muskegon, Michigan (63 FEDERAL RESERVE BULLETIN 926 (1977)), the Board determined that the Muskegon/Grand wise stated. Haven banking market was generally unattractive for de novo 2 The relevant banking market is approximated by the Minentry. Recent data indicate that the Muskegon/Grand Haven neapolis-St. Paul RMA, adjusted to include all of Carver banking market continues to be unattractive for de novo entry. County. 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Law Department 69 The Board has indicated on previous occasions not be in the public interest to approve the formathat a holding company should serve as a source tion of a bank holding company with an initial of financial and managerial strength to its subsidi- debt structure that could result in the weakening ary bank and that the Board will closely examine of Bank's overall financial condition. Accordingly, the condition of an applicant in each case with in view of these and other facts of record, the this consideration in mind.3 Having examined such Board concludes that the considerations relating factors in light of the record in this application, to banking factors weigh against approval of the the Board concludes that the record presents ad- application. verse considerations that warrant denial of the No significant changes in Bank's operations or proposal to place the ownership of Bank into in the services offered to its customers are anticicorporate form. pated to follow from consummation of the pro- As part of the subject proposal, Applicant would posed acquisition. Consequently, convenience and assume a substantial portion of the debt incurred needs factors lend no weight toward approval of by Applicant's principal in acquiring his shares this application. of Bank. Applicant proposes to service this debt On the basis of all the facts of record, the Board over a 12-year period through dividends to be concludes that the banking considerations involved declared by Bank and tax benefits to be derived in this proposal present significant adverse factors from filing consolidated tax returns. In the Board's bearing upon the financial and managerial review, Applicant's financial projections over the sources and future prospects of Applicant and debt retirement period appear to be unduly opti- Bank. Such adverse factors are not outweighed by mistic and it does not appear that Applicant will any procompetitive effects or by benefits that possess the financial flexibility necessary to meet would result in better serving the convenience and its annual debt service requirements while main- needs of the community. Accordingly, it is the taining adequate capital at Bank. Even under Ap- Board's judgment that approval of the application plicant's projections for deposit growth, Bank's would not be in the public interest and that the gross capital to total assets ratio at the end of the application should be denied. 12-year debt-servicing period will be below the On the basis of all the facts of record, the level deemed acceptable. These projections are application is denied for the reasons summarized based on the average deposit growth of nine per- above. cent for the years 1973-77. However, under pres- By order of the Board of Governors, effective ent ownership and management, deposit growth December 22, 1978. has averaged 15 percent annually. Projections based on this information indicate that capital Voting for this action: Governors Wallich, Coldwell, Partee, and Teeters. Absent and not voting: Chairman would decline still further by the end of the debt- Miller. servicing period. Based on these factors, Bank has not demonstrated the ability to pay dividends to (Signed) THEODORE E. ALLISON, provide a source of debt-servicing funds to Appli- [SEAL] Secretary of the Board. cant without placing a potential strain on Bank's capital position. The Board also notes that the other holding companies with which Applicant's The Wyoming National Corporation, principal is associated are likewise highly lev- Casper, Wyoming eraged. The Board is of the view that it would Order Approving Acquisition of Bank The Wyoming National Corporation, Casper, 3 The Bank Holding Company Act requires that the Board, Wyoming, a bank holding company within the in acting on an application to acquire a bank, inquire into the meaning of the Bank Holding Company Act, has financial and managerial resources of an applicant. While this proposal involves the transfer of the ownership of Bank from applied for the Board's approval under section individuals to a corporation owned by the same individuals, 3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to the Act requires that before an organization is permitted to become a bank holding company and thus obtain the benefits acquire 85.8 percent or more of the voting shares associated with the holding company structure, it must secure of Wyoming National Bank of East Casper, the Board's approval. Section 3(c) of the Act provides that the Board must, in every case, consider, among other things, Casper, Wyoming ("Bank"), a proposed new the financial and managerial resources of both the applicant bank. company and the bank to be acquired. The Board's action in this case is based on a consideration of such factors. See Board Notice of the application, affording opportunity of Governors of the Federal Reserve System v. First Lincolnwood Corporation, 47 U.S.L.W. 4048 (December 11, 1978). for interested persons to submit comments and Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 70 Federal Reserve Bulletin • January 1979 views, has been given in accordance with § 3(b) history; however, its prospects as a subsidiary of of the Act. The time for filing comments and views Applicant appear favorable. Accordingly, considhas expired, and the Board has considered the erations relating to banking factors are consistent application and all comments received, including with approval. Considerations relating to the conthose of the Comptroller of the Currency, in light venience and needs of the community to be served of the factors set forth in section 3(c) of the Act lend some weight toward approval since entry of (12 U.S.C. § 1842(c)). Bank into the eastern portion of the market will Applicant, the third largest bank holding com- give residents of that community a more convenipany in Wyoming, controls three bank subsidiaries ent source of banking services. Therefore, it is with aggregate deposits of $210 million, repre- the Board's judgment that the proposed acquisition senting 9.7 percent of total deposits in commercial would be in the public interest and that the applibanks in Wyoming.1 Since the application involves cation should be approved. the acquisition of a proposed new bank, consum- On the basis of the record, the application is mation of the proposal would not immediately approved for the reasons summarized above. The increase Applicant's share of deposits in commer- transaction shall not be made (a) before the thircial banks in Wyoming. tieth calendar day following the effective date of Bank, a new bank that has received preliminary this Order or (b) later than three months after that charter approval from the Comptroller of the Cur- date, and (c) Wyoming National Bank of East rency, is to be located in the eastern section of Casper, Casper, Wyoming, shall be opened for the Casper banking market,2 the same market in business not later than six months after the effecwhich Applicant's lead bank is located. Applicant, tive date of this Order. Each of the periods dethe largest banking organization in the Casper scribed in (b) and (c) may be extended for good banking market, controls deposits of $192.2 mil- cause by the Board, or by the Federal Reserve lion, representing 43.2 percent of total deposits Bank of Kansas City pursuant to delegated auin commercial banks in the market. While Appli- thority. cant is the largest banking organization in the By order of the Board of Governors, effective market, the Board finds that consummation of the December 28, 1978. proposal would not have significant anti-competitive effects. The Board notes that the market has Voting for this action: Governors Wallich, Coldwell, Partee, and Teeters. Absent and not voting: Chairman experienced significant growth in the past decade Miller. and this growth, which has enabled four banks to enter the market and a fifth bank to be chartered (Signed) GRIFFITH L. GARWOOD, since 1960, is expected to continue; that the mar- [SEAL] Deputy Secretary of the Board. ket has become less concentrated over the past decade; and that there is no evidence in the record that Applicant is attempting to pre-empt a desirable Orders Under Section 4 bank site from future market entrants.3 Accord- of Bank Holding Company Act ingly, on the basis of the above and other facts Bank America Corporation, of record, the Board concludes that competitive San Francisco, California considerations are consistent with approval of the application. Order Denying Continuation of Commercial Fi- The financial and managerial resources and fu- nance Activities and Commencement of Loan ture prospects of Applicant and its three subsidiary Servicing, Leasing, and Credit-related Insurance banks are regarded as sastisfactory. Bank, as a Agency Activities proposed new bank, has no financial or operating BankAmerica Corporation, San Francisco, California, a bank holding company within the mean- 1 All banking data are as of June 30, 1978. ing of the Bank Holding Company Act, has ap- 2 The Casper banking market is approximated by the Casper plied for the Board's approval, under § 4(c)(8) of Ranally Metropolitan Area, which includes the City of Casper and the towns of Mills, Evansville, and Paradise Valley, all in Natrona County, Wyoming. 3 While the EJoard has in this case delineated the Casper market as being approximated by the Ranally Metropolitan Area, it notes that the Board's staff is currently reexamining it necessary to await the conclusion of this market study before the market in connection with another application, and its acting on this application since a Board finding that the market preliminary finding is that the market boundaries should either should be expanded would not alter the Board's competitive remain the same or be expanded. The Board does not find analysis of this proposal. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 71 the Act (12 U.S.C. § 1843(c)(8)) and instant application. Upon approval of the applica- §225.4(b)(1) of the Board's Regulation Y (12 tion, Applicant proposes to have FACC recom- C.F.R. § 225.4(b)(1)), to continue 1 to engage in mence the activities terminated and to expand its commercial finance activities through Finance- activities to include servicing extensions of credit America Commercial Corporation ("FACC"), for itself and others, leasing real and personal Allentown, Pennsylvania, a direct subsidiary of property, and offering credit-related life, accident Finance America Corporation, Allentown, Penn- and disability, and property insurance in connecsylvania, which is a direct subsidiary of Applicant. tion with extensions of credit made or acquired Such activities include inventory and accounts by FACC. receivable financing, lease financing, equipment Consummation of this proposal would not elimfinancing, insurance premium financing, making inate existing or potential competition. The marloans to non-affiliated finance and leasing compa- kets for the services offered by FACC do not nies secured by pledges of accounts receivable of appear highly concentrated. FACC proposes to such companies, making loans secured by real and solicit business in 36 states and the District of personal property, and purchasing retail instalment Columbia and expects to compete principally with sales contracts. FACC also proposes to engage in large commercial banks and finance companies. the additional activities of servicing extensions of On the basis of the facts of record, the Board credit for itself and others, leasing real and per- concludes that consummation of the subject prosonal property, and offering credit-related life, posal would not have any significant adverse comaccident and disability, and property insurance in petitive effects. connection with extensions of credit made or ac- As indicated above, the application presents an quired by FACC. Such activities have been deter- after-the-fact request for the Board's approval to mined by the Board to be closely related to bank- conduct operations commenced in violation of the ing (12 C.F.R. §§ 225.4(a)(1), (3), (6), and (9)). Board's Regulation Y. Last year the Board con- Notice of the application, affording opportunity sidered and approved a somewhat similar domestic for interested persons to submit comments and case in which Applicant had engaged in nonbank views on the public interest factors, has been duly activities in violation of Regulation Y.3 In the published (43 Federal Register 24912 (1978)). international area, the Board has considered sev- The time for filing comments and views has ex- eral applications by Applicant that have involved pired and the Board has considered the application violations of the Board's regulations. Due in part and all comments received in the light of the public to the Board's concern about such violations, interest factors set forth in § 4(c)(8) of the Act Applicant instituted an extensive compliance pro- (12 U.S.C. § 1843(c)(8)). gram to ensure that all of its activities were con- Applicant is the largest banking organization in ducted in conformity with the substantive and the United States and controls Bank of America, procedural requirements of law and the Board's N. T. & S. A., San Francisco, California, which regulations. After evaluating the merits of each holds deposits of approximately $66.66 billion.2 of the cases where a violation had occurred, the In addition, Applicant directly controls twelve Board concluded that approval was appropriate. nonbanking subsidiaries. With respect to the subject proposal, however, the FACC (total assets of $23 million as of De- Board does not believe that approval of Applicember 31, 1977) has for four years, without prior cant's conduct, which was in violation of the Board approval, engaged in a range of commercial Board's Regulation Y, would be appropriate. Of lending activities. These activities have been con- particular concern to the Board in this matter is ducted from an office in Allentown, Pennsylvania, that when Applicant initially advised the Board and were commenced in violation of the Board's of the violation, Applicant attributed the violation Regulation Y. FACC has terminated the solici- to a lack of knowledge on the part of personnel tation of new business during the oendencv of the of Finance America Corporation in Allentown, the parent of FACC. In response to questions posed 1 On January 1, 1974, Applicant acquired shares of Finance- America Corporation, formerly GAC Finance, Inc., with the by the Board's staff, however, and upon further prior approval of the Board. At all times relevant hereto prior investigation of the facts, the direct involvement to September 3, 1974, FACC was an inactive corporation. On that date, Applicant and Finance America caused FACC to commence general commercial finance activities in violation of the Act and Regulation Y. During the pendency of this application, FACC has terminated the active solicitation of business. 3 BankAmerica Corporation (Data processing activities of 2 All banking data are as of March 31, 1978. FinanceAmerica) 63 FEDERAL RESERVE BULLETIN 687 (1977). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 72 Federal Reserve Bulletin • January 1979 of Applicant's management in San Francisco was applied for the Board's approval, under section established. 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and While the subject proposal does not represent section 225.4(b)(2) of the Board's Regulation Y a significant activity to an organization of the size (12 C.F.R. § 225.4(b)(2)), to retain ownership of and complexity of Applicant, the Board does not National Mortgage Corporation, Washington, regard such factors as relieving an organization D.C. ("Company"), a company that engages in from legal duties and obligations to which it and the activity of mortgage banking.1 Such activity competing organizations of lesser size and com- has been determined by the Board to be closely plexity are subject. The effectiveness of an orga- related to banking (12 C.F.R. § 225.4(a)(1)). nization's management in ensuring compliance Notice of the application, affording opportunity with the legal duties to which it is subject are for interested persons to submit comments and matters of paramount concern to the Board in views on the public interest factors, has been duly acting on applications. It is the Board's judgment, published (43 Federal Register 53,496). The time based upon all the facts of record in this matter, for filing comments and views has expired, and that approval of the application would be inappro- the Board has considered the application and all priate, and in order to ensure that Applicant does comments received in the light of the public internot benefit from actions that were commenced as est factors set forth in section 4(c)(8) of the Act a result of a violation, Applicant should be re- (12 U.S.C. § 1843(c)(8)). quired to divest itself promptly of the illegally The Board regards the standards of section acquired assets of FACC. 4(c)(8) for the retention of a nonbanking activity Accordingly, based upon the foregoing and to be the same as the standards for a proposed other considerations reflected in the record, the acquisition of a section 4(c)(8) activity. Applicant, Board has determined that the subject application a multibank holding company with bank subsidishould be denied.4 Applicant is hereby directed aries in four states and the District of Columbia, to divest itself of the assets of FACC that were has six bank subsidiaries in the relevant mortgage acquired in violation of the Board's Regulation Y market that are active mortgage lenders.2 These no later than ninety days from the effective date banks, as of June 30, 1978, had outstanding mortof this Order. gage loans of $415 million, representing 2.1 per- By order of the Board of Governors, effective cent of mortgage loans outstanding in the market, December 26, 1978. while Company currently has $1.9 million in mortgage loans outstanding in the market. Voting for this action: Governors Wallich, Partee, The acquisition by Applicant of Company in and Teeters. Present and not voting: Governor Cold- 1963, at which time Company was a small indewell. Absent and not voting: Chairman Miller. pendent mortgage company, did not have any (Signed) THEODORE E. ALLISON, significant adverse competitive effects. Since [SEAL] Secretary of the Board. 1975, Company has not originated any new loans. Reactivation of Company's activities would be equivalent to de novo entry and would tend to be pro-competitive by providing an additional source Financial General Bankshares, Inc., for mortgage services. There is no evidence indi- Washington, D.C. cating that the retention of Company by Applicant Order Approving would lead to any undue concentration of re- Retention of National Mortgage Corporation sources, conflicts of interests, or unsound banking practices. Furthermore, approval of the application Financial General Bankshares, Inc., Washingwould enable Company to become an additional ton, D.C., a bank holding company within the competitor serving the mortgage needs of the relemeaning of the Bank Holding Company Act, has 1 Applicant became a bank holding company as a result of the 1966 amendments to the Act, which also required divesti- 4 In acting on this application the Board has considered ture of Applicant's impermissible nonbanking interests by comments from an individual from Providence, Rhode Island, December 31, 1978. Subsequently, the 1970 Amendments to in opposition to approval of Applicant's proposal, questioning the Act were passed, and Applicant now seeks to retain whether Applicant's sale of property insurance would serve Company through this application, pursuant to section 4(c)(8) the interests of the people of that state. The Board has examined of the Act. the protest, and, in light of the protestant's failure to cite any 2 The market for Company's mortgage activity is approxisupporting facts, concludes that there exists no basis in fact mately the area within a 75-mile radius from the center of for the individual's concern. Washington, D.C. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 73 vant community and this result would be of benefit Therefore, the Board hereby denies the request to the public. of Georgia Legal Services Program, Inc., for re- Based upon the foregoing and other consid- consideration of the Board's Order of May 1, erations reflected in the record, the Board has 1978.1 determined that the balance of the public interest By order of the Board of Governors, effective factors the Board is required to consider under December 22, 1978. § 4(c)(8) is favorable. Accordingly, the applica- Voting for this action: Governors Wallich, Coldwell, tion is hereby approved. This determination is Partee, and Teeters. Absent and not voting: Chairman subject to the conditions set forth in section Miller. 225.4(c) of Regulation Y and to the Board's authority to require such modification or termination (Signed) GRIFFITH L. GARWOOD, of the activities of a holding company or any of [SEAL] Deputy Secretary of the Board. its subsidiaries as the Board finds necessary to assure compliance with the provisions and pur- 1 In view of the Board's decision to deny the request for poses of the Act and the Board's regulations and reconsideration, the requests for a stay, pending reconsideration by the Board, and to present views orally to the orders issued thereunder, or to prevent evasion Board, are hereby rendered moot. thereof. By order of the Board of Governors, effective December 28, 1978. Security Pacific Corporation, Voting for this action: Governors Wallich, Coldwell, Los Angeles, California Partee, and Teeters. Absent and not voting: Chairman Miller. Order Approving Acquisition of American Finance System Incorporated (Signed) GRIFFITH L. GARWOOD, [SEAL] Deputy Secretary of the Board. Security Pacific Corporation, Los Angeles, California ("Applicant"), a bank holding company within the meaning of the Bank Holding Company Act ("Act"), has applied for the Board's ap- Manufacturers Hanover Corporation, proval, under § 4(c)(8) of the Act (12 U.S.C. New York, New York § 1843(c)(8)) and § 225.4(b)(2) of the Board's Order Denying Request for Regulation Y (12 C.F.R. § 225.4(b)(2)), to ac- Reconsideration and Stay quire all of the outstanding shares of American Finance System Incorporated, Silver Spring, Georgia Legal Services Program, Inc., Atlanta, Maryland ("AFSI"),1 and thereby to acquire con- Georgia, has requested reconsideration, and a stay trol of certain of its subsidiaries including General pending reconsideration by the Board, of the Order Fidelity Life Insurance Company, Richmond, of the Board dated May 1, 1978, approving the Virginia ("GFLIC").2 AFSI, directly and through application of Manufacturers Hanover Corpora- subsidiaries, is engaged in making direct consumer tion, New York, New York, pursuant to section instalment loans, secured and unsecured, to indi- 4(c)(8) of the Bank Holding Company Act (12 viduals, purchasing consumer instalment sales fi- U.S.C. § 1843(c)(8)) to acquire First Credit Corporation, Whiteville, North Carolina, and First Credit Corporation of Georgia, Fayetteville, 1 Applicant proposes to acquire the shares of AFSI by Georgia. Georgia Legal Services Program, Inc., merging it into a nonoperating wholly-owned subsidiary of Applicant. The subsidiary into which AFSI is to be merged has also requested to present its views orally to has no significance except as a means to facilitate the acquisithe Board. tion of the shares of AFSI. 2 Applicant also proposes to acquire indirectly four wholly- The Board has reviewed the request for recon- owned subsidiaries of AFSI that are engaged solely in the sideration and finds that Georgia Legal Services provision of specialized nonbanking service activities, such as management consulting, accounting, advertising, personnel, Program, Inc., has not presented relevant facts purchasing, printing and supply, and acting as agent for collection of insurance commissions. Such services are provided that, for good cause shown, were not previously exclusively to AFSI and its other subsidiaries in connection presented to the Board. Moreover, it does not with its finance and insurance business. AFSI could itself perform such activities directly through a division or departotherwise appear that reconsideration of the ment, and the Board believes that § 4(c)(8) of the Act permits, Board's Order of May 1, 1978, would be appro- with the Board's approval, the acquisition of shares of whollyowned subsidiaries of a § 4(c)(8) company that engage in priate. activities that such a company could engage in directly. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 74 Federal Reserve Bulletin • January 1979 nance contracts, making secured and unsecured Through its subsidiaries, Security Pacific Ficommercial and agricultural loans, and operating nance Corp., Los Angeles, California ("SPFC") two industrial banks under the laws of Colorado.3 and The Bankers Investment Company, Hutchin- AFSI, directly and through subsidiaries, also acts son, Kansas ("BIC"), Applicant also engages in as agent for the sale of credit life and credit consumer and commercial finance and creditaccident and health insurance and property insur- related insurance agency and underwriting activiance, all of which are directly related to extensions ties, similar to those of AFSI and its subsidiaries.8 of credit by AFSI.4 Through GFLIC, AFSI acts SPFC and BIC operate 90 loan offices in twelve as underwriter for credit life, accident, and health states, and together they are the 58th largest noninsurance directly related to extensions of credit captive finance company in the United States in by AFSI.5 Each of these activities has been deter- terms of total capital.9 On December 31, 1977, mined by the Board to be closely related to bank- they had consolidated assets of $209 million and ing (12 C.F.R. § 225.4(a)(1), (2), (9), and (10)). receivables of $164 million, the majority of which Notice of the application, affording opportunity were loans originated in California and Kansas. for interested persons to submit comments on the AFSI is the 21st largest non-captive finance public interest factors, has been duly published (43 company in the United States on the basis of total Federal Register 37490). The time for filing com- capital,10 and has total assets of $340 million and ments has expired, and the Board has considered receivables of approximately $350 million. It the application and all comments received, in- operates 370 offices in 22 states of which approxicluding those of the West Virginia Independent mately 220 such offices, accounting for 70 percent Bankers Association ("IBA"), in the light of the of AFSI's receivables, are located in an eight-state public interest factors set forth in § 4(c)(8) of the area consisting of Maryland, Virginia, West Vir- Act.6 ginia, Pennsylvania, Ohio, New York, New Jer- Applicant, by virtue of its control of Security sey, and Delaware. Pacific National Bank, Los Angeles, California The Board believes that the relevant product ("Bank"), is the second largest banking organi- market to be considered in evaluating the competzation in California and the seventh largest in the itive effects of this proposal is the making of United States in terms of domestic deposits. Bank, personal cash loans.11 SPFC and BIC have loan with deposits of $11.8 billion, representing 11.7 offices in seventeen local markets where AFSI has percent of the total deposits in commercial banks loan offices, and from the record it appears that in California, offers retail, wholesale, domestic both Applicant and AFSI hold a significant amount and international banking, and trust services.7 Ap- of the outstanding personal cash loans in at least plicant engages through subsidiaries in a variety sixteen of those markets. In order to eliminate the of nonbanking activities, including mortgage possibility that consummation of the proposal banking, leasing, and venture capital financing. would result in adverse effects on existing competition, Applicant has proposed to divest 19 offices of AFSI in sixteen of those local markets within one year of the date of this Order. In order to 3 While these offices may make some commercial loans, they do not accept demand deposits, and therefore, do not constitute commercial banks within the meaning of section 2(c) of the Act. 4 A subsidiary of AFSI also acts as agent for the sale of 8 SPFC was organized de novo by Applicant in 1974 to certain insurance policies Unrelated to extensions of credit. conduct its consumer finance business primarily in California. Applicant has committed to the Board that upon consumma- In 1976 Applicant acquired BIC with 57 finance offices located tion, it will discontinue this activity. in nine south-central states and having total assets of $40 5 GFLIC presently underwrites credit life and credit accident million. These BIC offices do business under the name of and health insurance for unaffiliated financial institutions. SPFC. However, Applicant does not seek the Board s permission to 9 American Banker, June 19, 1978. A "non-captive" fiengage in this business, and has committed to the Board that nance company is one that does not restrict its business to it will cause GFLIC to dispose of this business. loans made in connection with the purchase of a particular 6 IB A contends that Applicant's acquisition of 16 AFSI manufacturer's product. offices in West Virginia would represent the formation of a 10 Id. multibank holding company in violation of state law. Section 11 Since AFSI is also engaged in other types of consumer 31 A-1-2 of the West Virginia Banking Code defines "bank" lending, Applicant contends that the relevant product market as a corporation chartered to conduct a banking business, a should include several other types of loans and lenders. The trust company., or an industrial bank chartered in West Vir- Board has examined Applicant's data submitted in support of ginia. Inasmuch as AFSI's West Virginia offices do not fall its claim in this regard, but in light of the fact that personal within any of these categories, and are not banks under state cash loans continue to be the principal product offered by law, the Board concludes that IBA's objection to the proposal consumer finance companies, the Board believes that there are is not persuasive. not sufficient grounds to warrant a departure from its earlier 7 All financial data are as of December 31, 1977, unless determination. Bankers Trust Corporation/Public Loan Comotherwise indicated. pany, 54 FEDERAL RESERVE BULLETIN (1973). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 75 ensure that the offices will be completely divested the Board believes that such negative effects are and that they will be divested as viable going tempered somewhat by the large number of other concerns, the Board expects that such offices will competitors that will remain after consummation be sold as going concerns holding substantially the of the proposal. Moreover, when balanced against same quality and type of assets as those offices the public benefits expected to result from this held on October 30, 1978 and in an amount not transaction, the Board does not view the adverse less than the amount held by those offices on that effects on competition referred to above or the date. Applicant proposes to retain the two offices effects on the concentration of resources as being of AFSI that are chartered as Colorado industrial so serious as to warrant denial of this proposal. banks, because of the difficulty of obtaining in- Affilication of AFSI with Applicant will provide dustrial bank charters in metropolitan areas in AFSI with access to Applicant's financial and Colorado. While such difficulty alone would not managerial resources and ensure the continued justify retention of these offices, in this case the availability of personal loans and related insurance combined market share of Applicant and AFSI in services to AFSI's customers at its present locaeach of the two markets in which the industrial tions. The Board views this factor as particularly banks operate would be less than one percent. significant in light of AFSI's reduction of its Thus, while the acquisition of AFSI by Applicant overall operations in recent years, and the diffiwill eliminate some existing competition between culty it has experienced in obtaining borrowed them, in view of the small size of the market shares funds at competitive rates. Furthermore, acquisiin the two markets and the large number of com- tion of AFSI by Applicant should enable AFSI petitors in each market, the Board does not view to become a more effective competitor in the areas the effects of the transaction on existing competi- where it operates, and to provide its customers tion as significant. with new and improved services. In particular, With regard to potential competition, the Board upon consummation of the proposal, Applicant notes that AFSI has recently experienced serious intends to assist AFSI to offer its customers larger operational problems, and undergone a significant loans, loans with extended maturities, and reduccontraction in its operations since 1973, with the tions in the rate of interest on some loans. In number of its offices being reduced from 758 to addition, Applicant has stated that following con- 370 and its gross loan receivables declining from summation of the proposal AFSI will offer at $515 million to $350 million. In view of problems reduced premiums the several types of credit infaced by AFSI and its prospects for the future, surance policies that it will underwrite.12 Since it does not appear that AFSI is a likely entrant Applicant proposes to sell credit life and credit into the local markets where Applicant presently accident and health insurance underwritten by has offices. On the other hand, Applicant has AFSI in each of the states in which AFSI operates, increased the number of its loan offices by one Applicant's proposed rate reductions vary accordthird since 1976, and it has the potential to enter ing to the permissible rate structures in each remany of the local markets where AFSI presently spective state, and involves rate reductions for has offices. However, in light of the large number reducing-term single and joint credit life insurance of other potential entrants into AFSI's local mar- at premium rates ranging from 2 percent to 15 kets, the Board concludes that consummation of this proposal would have only slightly adverse effects on potential competition. As noted above, Applicant, which controls the nation's 7th largest bank and the 58th largest 12 With respect to underwriting credit life and credit accident finance company, proposes to acquire the 21st and health insurance, which is generally made available by largest finance company. Moreover, Applicant's banks and other lenders and is designed to assure repayment of a loan in the event of death or disability of the borrower, subsidiary bank has approximately $111 million the Board has stated: in loans outstanding to finance companies other To assure that engaging in the underwriting of credit life and credit accident and health insurthan its subsidiaries and AFSI. On the basis of ance can reasonably be expected to be in the these and other facts of record, the Board is of public interest, the Board will only approve applications in which an applicant demonstrates the view that consummation would have some that approval will benefit the consumer or result negative effects with respect to considerations in other public benefits. Normally, such a showing would be made by a projected reducspecified in the Act, principally in terms of an tion in rates or increase in policy benefits due to bank holding company performance of this undue concentration of resources. Nevertheless, service. (12 C.F.R. § 225.4(a)(10) n. 7.) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 76 Federal Reserve Bulletin • January 1979 percent below the rates presently charged in each Francisco, pursuant to authority hereby delegated. of the respective states. By order of the Board of Governors, effective On the basis of these and other facts of record December 8, 1978. the Board concludes that the benefits to the public Voting for this action: Chairman Miller and Goverthat would result from Applicant's acquisition of nors Wallich, Coldwell, Partee, and Teeters. AFSI, including the reductions in insurance premiums that Applicant proposes to establish, are (Signed) GRIFFITH L. GARWOOD, sufficient to outweigh the slightly adverse effects [SEAL] Deputy Secretary of the Board. on competition that would result from the proposed acquisition. Furthermore, there is no evidence in the record to indicate that consummation of the proposed transaction would result in unfair competition, conflicts of interest, unsound banking The Wachovia Corporation, practices any or other effects that would be adverse Winston-Salem, North Carolina to the public interest. Order Approving Based upon the foregoing and other consid- Retention of Wachovia Mortgage Company erations reflected in the record, the Board has determined that the balance of the public interest The Wachovia Corporation, Winston-Salem, factors the Board is required to consider under North Carolina, a bank holding company within section 4(c)(8) is favorable. Accordingly, the ap- the meaning of the Bank Holding Company Act, plication is hereby approved, subject to the condi- has applied for the Board's approval, under tions that: (1) following consummation of the § 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and proposed acquisition, AFSI discontinue certain § 225.4(b)(2) of the Board's Regulation Y (12 impermissible insurance underwriting and agency C.F.R. § 225.4(b)(2)), to retain Wachovia Mortactivities in which AFSI is presently engaged; (2) gage Company, Winston-Salem, North Carolina within one year of the date of this Order, AFSI ("Company"), a company that engages in the divest all of those offices of AFSI at which there activities of providing mortgage banking services, is existing competition with SPFC, other than acting as adviser to a real estate investment trust, those Colorado industrial bank offices located in acting as general partner in two apartment projects Denver and Colorado Springs, Colorado; and, (3) constructed and operated under section 236 of the AFSI maintain on a continuing basis the public National Housing Act, and acting as agent for benefits that the Board has found to be reasonably credit-related life, accident, health, and property expected to result from this proposal with regard and casualty insurance. Such activities have been to insurance underwriting activities. In accom- determined by the Board to be closely related to plishing the divestiture of AFSI's offices, Appli- banking (12 C.F.R. § 225.4(a)(1), (5), (7), and cant is required to submit its plan for disposing (9)). of such offices to the Board within six months and, Notice of the application, affording opportunity if deemed appropriate to ensure divestiture, Ap- for interested persons to submit comments and plicant may be required to transfer the offices views on the public interest factors, has been duly irrevocably to an independent trustee who shall published (43 Federal Register 33324). The time have the duty gf divesting the offices within the for filing comments and views has expired, and one year period. This determination is also subject the Board has considered the application and all to the conditions set forth in § 225.4(c) of Regu- comments received in the light of the public interlation Y and to the Board's authority to require est factors set forth in § 4(c)(8) of the Act (12 such modification or termination of the activities U.S.C. § 1843(c)(8)). of a holding company or any of its subsidiaries Applicant, a one-bank holding company, beas the Board finds necessary to assure compliance came a bank holding company as a result of the with the provisions and purposes of the Act and 1970 Amendments to the Act by virtue of its the Board's regulations and orders issued control of Wachovia Bank and Trust Company, thereunder, or to prevent evasion thereof. The Winston-Salem, North Carolina ("Bank"). Aptransaction shall be made not later than three plicant is the largest banking organization in the months after the effective date of this Order, unless State of North Carolina with total deposits of such period is extended for good cause by the approximately $2.9 billion, representing 20.3 per- Board or by the Federal Reserve Bank of San cent of total deposits in commercial banks in the Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 77 State.1 Applicant established Company as a cant is represented. Accordingly, in view of the wholly-owned subsidiary in November 1968. Pur- slight overlap in the types of mortgages originated suant to the provisions of section 4 of the Act, by Bank and Company and the market shares held Applicant has until December 31, 1980, to divest by Bank and Company, Applicant cannot be reits interest in Company or, in the alternative, to garded as dominant in the mortgage lending marapply and secure the Board's approval to retain ket in any relevant area. The Board concludes, such interest.2 In addition to Bank and Company, based on all the facts of record, that no anticom- Applicant owns a data-processing subsidiary, Wa- petitive effects have resulted from Applicant's use chovia Services, Inc. of Company as a vehicle for de novo expansion The Board regards the standards under section of its mortgage lending activities in North Caro- 4(c)(8) of the Act for retention of shares to be lina. Accordingly, the competitive effects of the the same as the standards for a proposed organi- subject proposal are regarded as consistent with zation. Company was established by Applicant in approval. 1968 and acquired from Bank ten mortgage loan It appears that Applicant's expansion of Comproduction offices in North Carolina and Bank's pany beyond the State of North Carolina has had FHA and VA residential property loan portfolio. procompetitive effects by providing alternative In 1969 Company acquired National Home Loans, sources of mortgage lending to consumers. In Inc., Atlanta, Georgia, with offices in Atlanta, addition, Applicant has, through Company, in- Georgia, and Pensacola, Florida, where Applicant creased the variety and availability in various was not previously represented. Company later markets of mortgage services for consumers. established offices de novo in Columbia and These benefits to the public are consistent with Charleston, South Carolina. Besides its four out- approval of the subject application. of-state offices, Company currently operates in There is no evidence in the record indicating eight distinct market areas in North Carolina.3 that the proposal would result in undue concentra- Inasmuch as Company was established de novo tion of resources, unfair competition, conflicts of by Applicant, it does not appear that Applicant's interests, unsound banking practices or other adacquisition of Company in 1968 had any adverse verse effects. effect on competition in any relevant area. Based upon the foregoing and other consid- Company is the forty-sixth largest mortgage erations reflected in the record, the Board has company in the nation, with a servicing volume determined that the balance of the public interest of $911 million (as of December 31, 1977). In factors the Board is required to consider under 1977 approximately 75 percent of Company's § 4(c)(8) is favorable. Accordingly, the applicaloans were 1-4 family residential loans, and 95 tion is hereby approved. This determination is percent of these loans were FHA or VA loans. subject to the conditions set forth in § 225.4(c) Bank does not make residential loans of this type, of Regulation Y and to the Board's authority to although it does engage in mortgage lending on require such modification or termination of the commercial property. However, the combined activities of a holding company or any of its volume of such commercial property lending by subsidiaries as the Board finds necessary to assure Bank and Company is estimated not to exceed 5 compliance with the provisions and purposes of percent of the total volume of such lending in any the Act and the Board's regulations and orders relevant market where both Bank and Company issued thereunder, or to prevent evasion thereof. operate. Furthermore, Applicant's total volume of By order of the Board of Governors, effective mortgages of all types in 1977 represented a small December 27, 1978. percentage of the total volume of mortgages in most of the North Carolina markets where Appli- Voting for this action: Governors Wallich, Coldwell, 1 Banking data are as of December 31, 1977. Partee, and Teeters. Absent and not voting: Chairman 2 Section 4 of the Act provides, inter alia, that nonbanking activities acquired between June 30, 1968, and December 31, Miller. 1970, by a company that becomes a bank holding company as a result of the 1970 Amendments may not be retained beyond December 31, 1980, without Board approval. 3 These market areas are the Asheville SMSA, the Charlotte-Gastonia SMSA, the Greensboro-Winston-Salem-High Point SMSA, the Raleigh-Durham SMSA, the Wilmington (Signed) GRIFFITH L. GARWOOD, SMSA, the Onslow County market, and the Pitt County market, all in North Carolina. [SEAL] Deputy Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

78 Federal Reserve Bulletin • January 1979 Certifications Under the virtue of its ownership of more than 25 percent Bank Holding Company Tax Act of 1976 of the outstanding voting shares of Bank. 5. Ellingson holds property acquired by it on or before July 7, 1970, the disposition of which Ellingson Corporation, would be necessary or appropriate to effectuate Kenyon, Minnesota section 4 of the BHC Act if Agency were to Prior Certification Pursuant to the Bank Holding continue to be a bank holding company beyond Company Tax Act of 1976 December 31, 1980, which property is "prohibited property" within the meaning of section 1103(c) [Docket No. TCR 76-156] of the Code. Ellingson Corporation, Kenyon, Minnesota On the basis of the foregoing information, it ("Ellingson ') has requested a prior certification is hereby certified that: pursuant to section 1101(b)(1) of the Internal (A) Ellingson is a qualified bank holding cor- Revenue Code ("Code"), as amended by section poration, within the meaning of section 1103(b) 2(a) of the Bank Holding Company Tax Act of of the Code, and satisfies the requirements of that 1976, that its proposed divestiture of all of the section; 606 shares presently held by Ellingson of Security (B) the 606 shares of Bank that Ellingson pro- State Bank, Kenyon, Minnesota ("Bank"), poses to distribute to its shareholders are all or through the distribution of such shares to the two part of the property by reason of which Ellingson shareholders of Ellingson, is necessary or appro- controls (within the meaning of section 2(a) of the priate to effectuate the policies of the Bank Hold- BHC Act) a bank or bank holding company; and ing Company Act (12 U.S.C. § 1841 et seq.) (C) the distribution of the 606 shares of Bank ("BHC Act"). is necessary or appropriate to effectuate the poli- In connection with this request, the following cies of the BHC Act. information is deemed relevant for purposes of This certification is based upon the repreissuing the requested certification:1 sentations made to the Board by Ellingson and 1. Ellingson is a corporation organized under upon the facts set forth above. In the event the the laws of the State of Minnesota on December Board should hereafter determine that facts mate- 8, 1959, under the name Security Agency, Inc. rial to this certification are otherwise than as rep- On April 23, 1970, Security Agency, Inc. changed resented by Ellingson, or that Ellingson has failed its name to Ellingson Corporation. to disclose to the Board other material facts, it 2. On July 7, 1970, Ellingson acquired owner- may revoke this certification. ship and control of 600 shares, representing 60 By order of the Board of Governors, acting percent of the outstanding voting shares of Bank. through its General Counsel, pursuant to delegated Prior to July 7, 1970, Ellingson owned 6 shares authority, (12 C.F.R. § 265.2(b)(3)), effective of Bank. Ellingson presently owns and controls December 20, 1978. 606 shares, representing 60.6 percent of the outstanding voting shares of Bank. (Signed) GRIFFITH L. GARWOOD, 3. Ellingson became a bank holding company [SEAL] Deputy Secretary of the Board. on December 31, 1970, as a result of the 1970 Amendments to the BHC Act, by virtue of its ownership and control at that time of more than 25 percent of the outstanding voting shares of Bank, and it registered as such with the Board on April 23, 1971. First Missouri Banks, Inc., 4. Ellingson would have been a bank holding Creve Coeur, Missouri company on July 7, 1970 if the BHC Act Amendments of 1970 had been in effect on that date by Prior Certification Pursuant to the Bank Holding Company Tax Act of 1976 [Docket No. TCR 76-106(b)] 1 This information derives from Ellingson's correspondence First Missouri Banks, Inc., Creve Coeur, Miswith the Board concerning its request for this certification, souri ("First Missouri"), has requested a prior Ellingson's Registration Statement filed with the Board pursuant to the BHC Act, and other records of the Board. certification pursuant to § 1101(c)(2) of the Inter- Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 79 nal Revenue Code (the "Code"), as amended by located on Lot 2 of the Lake House Farm Subdi- § 3(a) of the Bank Holding Company Tax Act of vision in Section 3, Township 45 North, Range 1976 (the "Tax Act"), that the proposed distri- 5 East, City of Creve Coeur, St. Louis County, bution by First Missouri to its shareholders of Missouri. The nine acres were acquired by Olive shares of a new corporation to be known as in 1963, and First Missouri acquired indirect Properties One, Inc. ("New Corp"), to be formed ownership and control of the nine acres on May to acquire 9 acres of real property now held by 7, 1970, as a result of First Missouri's acquisition First Properties, Inc. ("Properties"), a subsidiary of Bank. The disposition of the nine acres would of First Missouri, is necessary or appropriate to be necessary or appropriate to effectuate section effectuate § 4 of the Bank Holding Company Act 4 of the BHC Act if First Missouri were to con- (12 U.S.C. § 1843) ("BHC Act"). tinue to be a bank holding company beyond De- In connection with this request, the following cember 31, 1980. is deemed relevant for purposes of issuing the 5. First Missouri proposes to organize New requested certification:1 Corp for the sole purpose of receiving the nine 1. First Missouri is a corporation organized acres of real property from Properties. After the under the laws of the State of Missouri on No- transfer of the nine acres to New Corp, the shares vember 24, 1969. Properties is a corporation or- of New Corp will be distributed pro rata to the ganized under the laws of the State of Missouri common shareholders of First Missouri. on May 7, 1970. On May 8, 1970, First Missouri 6. First Missouri has committed to the Board acquired ownership and control of 500 shares, that New Corp will have no directors or officers representing 100 percent of the outstanding voting in common with First Missouri or any subsidiary shares, of Properties. of First Missouri. 2. On May 7, 1970, First Missouri acquired On the basis of the foregoing information, it ownership and control of 13,178 shares, repre- is hereby certified that: senting 87.1 percent of the outstanding voting (A) First Missouri is a qualified bank holding shares, of Creve Coeur Bank & Trust Company, corporation, within the meaning of § 1103(b) of Creve Coeur, Missouri ("Bank"),2 and thereby, the Code, and satisfies the requirements of that on the same date, acquired indirect ownership and subsection; control of Olive Boulevard Corporation, Creve (B) the nine acres of real property proposed to Coeur, Missouri ("Olive"), a subsidiary of Bank. be divested is "prohibited property" within the On May 8, 1970, Olive was merged into Proper- meaning of § 1103(c) of the Code; and ties. (C) the exchange of the nine acres of real prop- 3. First Missouri became a bank holding com- erty for shares of New Corp and the distribution pany on December 31, 1970, as a result of the of such shares is necessary or appropriate to ef- 1970 Amendments to the BHC Act, by virtue of fectuate § 4 of the BHC Act. its ownership and control at that time of more than This certification is based upon the repre- 25 percent of the outstanding voting shares of sentations made to the Board by First Missouri Bank, and it registered as such with the Board and upon the facts set forth above. In the event on August 24, 1971. First Missouri would have that the Board should hereafter determine that facts been a bank holding company on July 7, 1970, material to this certification are otherwise than as if the BHC Act Amendments of 1970 had been represented by First Missouri, or that First Misin effect on such date, by virtue of its ownership souri has failed to disclose to the Board other and control on that date of more than 25 percent material facts, it may revoke this certification. of the outstanding voting shares of Bank. First By order of the Board of Governors of the Missouri currently owns and controls 87.1 percent Federal Reserve System, acting through its Genof the oustanding voting shares of Bank. eral Counsel pursuant to delegated authority (12 4. Properties owns nine acres of real property C.F.R. § 265.2(b)(3)), effective December 21, 1978. 1 This information derives from First Missouri's correspondence with the Board concerning its request for certification, First Missouri's Registration Statement filed with the Board pursuant to the BHC Act, and other records of the Board. (Signed) GRIFFITH L. GARWOOD, 2 The name of Bank has since been changed to First Missouri Bank of Creve Coeur, Creve Coeur, Missouri. [SEAL] Deputy Secretary of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 80 Federal Reserve Bulletin • January 1979 Hansen-Lawrence Agency, Inc., NE y SW y, Farm Unit "H" described as NW 4 4 Worden, Montana lA SW lA. The disposition by Agency of its interest in this Real Property would be necessary or ap- Prior Certification Pursuant to the Bank Holding propriate to effectuate section 4 of the BHC Act Company Tax Act of 1976 if Agency were to continue to be a bank holding company beyond December 31, 1980. [Docket No. TCR 76-166] On the basis of the foregoing information it is Hansen-Lawrence Agency, Inc., Worden, hereby certified that: Montana ("Agency"), has requested a prior cer- (A) Agency is a qualified bank holding cortification pursuant to section 1101(c) of the Internal poration, within the meaning of subsection (b) of Revenue Code (the "Code"), as amended by section 1103 of the Code, and satisfies the resection 2(a) of the Bank Holding Company Tax quirements of that subsection; Act of 1976 (the "Tax Act"), that Agency's (B) the Real Property described herein is "proproposed distribution pro rata to its shareholders hibited property" within the meaning of section of all of its right, title, and interest in certain real 1103(c) of the Code; and estate and the improvements thereon ("Real Prop- (C) the distribution by Agency of all of its right, erty"), is necessary or appropriate to effectuate title, and interest in the Real Property described section 4 of the Bank Holding Company Act (12 herein is necessary or appropriate to effectuate U.S.C. § 1843 et seq.) ("BHC Act"). section 4 of the BHC Act. In connection with this request, the following This certification is based upon the repreinformation is deemed relevant for purposes of sentations made to the Board by Agency and upon issuing the requested certification:1 the facts set forth above. In the event the Board 1. Agency is a corporation organized on June should hereafter determine that facts material to 23, 1965, under the laws of the State of Montana. this certification are otherwise than as represented 2. On October 19, 1965, Agency acquired by Agency, or that Agency has failed to disclose ownership and control of 480 shares, representing to the Board other material facts, it may revoke 48 percent of the outstanding voting shares, of this certification. Farmers State Bank of Worden, Worden, Montana By order of the Board of Governors, acting ("Bank"). through its General Counsel, pursuant to delegated 3. Agency became a bank holding company on authority (12 C.F.R. § 265.2(b)(3)), effective De- December 31, 1970, as a result of the 1970 cember 28, 1978. Amendments to the BHC Act, by virtue of its ownership and control at that time of more than (Signed) GRIFFITH L. GARWOOD, 25 percent of the outstanding voting shares of [SEAL] Deputy Secretary of the Board. Bank, and it registered as such with the Board on July 12, 1971. Agency would have been a bank holding company on July 7, 1970, if the BHC The Jacobus Company, Act Amendments of 1970 had been in effect on Wauwatosa, Wisconsin such date, by virtue of its ownership and control Final Certification Pursuant to the Bank Holding on that date of more than 25 percent of the voting Company Tax Act of 1976 shares of Bank. Agency currently owns and controls 48 percent of the outstanding voting shares [Docket No. TCR 76-138] of Bank. 4. Agency acquired certain agricultural Real The Jacobus Company, Wauwatosa, Wisconsin Property on October 25, 1968, and has owned such ("Jacobus"), has requested a final certification property continuously since that time. Such prop- pursuant to § 1101(e) of the Internal Revenue erty is described as: Township 3 North, Range Code (the "Code"), as amended by § 2(a) of the 29 East, of the Principle Meridian, Yellowstone Bank Holding Company Tax Act of 1976 (the County, Montana, Section 20: Farm Unit "C" "Tax Act"), that it has (before the expiration of described as Lot 7, Farm Unit "G" described as the period prohibited property is permitted under the Bank Holding Company Act (12 U.S.C. § 1841 et. seq.) ("BHC Act") to be held by a 1 This information derives from Agency's correspondence with the Board concerning its request for this certification, bank holding company) ceased to be a bank hold- Agency's Registration Statement filed with the Board pursuant ing company. to the BHC Act, and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 81 In connection with this request, the following 5. Jacobus has represented that it does not coninformation is deemed relevant, for purposes of trol in any manner the election of a majority of issuing the requested certification:1 directors, or exercise a controlling influence over 1. Effective November 10, 1977, the Board the management or policies of Inland or any bank issued a prior certification pursuant to section or any other company that controls a bank. 1101(b) of the Code with respect to the proposed On the basis of the foregoing information, it divestiture by Jacobus of all of the 340,983 shares is hereby certified that Jacobus has (before the of common stock (the "Inland Shares") of Inland expiration of the period prohibited property is Heritage Corporation, (formerly Inland Financial permitted under the BHC Act to be held by a bank Corporation) Milwaukee, Wisconsin ("Inland"), holding company) ceased to be a bank holding presently held by Jacobus, through the pro rata company. distribution of such shares to the holders of com- This certification is based upon the repremon stock of Jacobus. sentations and commitments made to the Board The Board's Order certified that: by Jacobus and upon the facts set forth above. (A) Jacobus is a qualified bank holding cor- In the event the Board should determine that facts poration, within the meaning of subsection (b) of material to this certification are otherwise than as section 1103 of the Code, and satisfies the re- represented by Jacobus, or that Jacobus has failed quirements of that subsection; to disclose to the Board other material facts or (B) the shares of Inland that Jacobus proposes to fulfill any commitments made to the Board in to distribute to its shareholders are all of the connection herewith, it may revoke this certifiproperty by reason of which Jacobus controls cation. (within the meaning of § 2(a) of the BHC Act) By order of the Board of Governors, acting a bank or a bank holding company; and through its General Counsel, pursuant to delegated (C) the distribution of such shares is necessary authority (12 C.F.R. 265.2(b)(3)), effective Deor appropriate to effectuate the policies of the BHC cember 27, 1978. Act. 2. On November 16, 1977, Jacobus distributed (Signed) GRIFFITH L. GARWOOD, to its shareholders, on a pro rata basis, a total [SEAL] Deputy Secretary of the Board. of 340,983 shares of Inland representing all of the shares of common stock of Inland held by Jacobus. Jacobus does not presently hold any interest in The Jacobus Company Inland. 3. The prior certification issued on November The Jacobus Company, Wauwatosa, Wisconsin 10, 1977 was granted upon the condition that no ("Jacobus"), a bank holding company within the person holding an office or position (including an meaning of § 2(a) of the Bank Holding Company advisory or honorary position) with Jacobus or any Act of 1956, as amended (12 U.S.C. § 1841 et. of its subsidiaries as a director, policy-making seq.) (the "Act"), has requested a determination, employee or consultant, or who performs (directly, pursuant to the provisions of section 2(g)(3) of or through an agent, representative or nominee) the Act (12 U.S.C. 1841(g)(3)), that with respect functions comparable to those normally associated to the distribution of 340,983 shares of common with such office or position, will hold any such stock of Inland Heritage Corporation, Milwaukee, office or position or perform any such function Wisconsin ("Inland"), to the shareholders of Jawith Inland or any of its subsidiaries. Effective cobus, Jacobus is not capable of controlling Inland July 28, 1978, all such interlocking relationships notwithstanding the fact that on the date of such between Jacobus and Inland, and their respective distribution Jacobus had directors and officers in subsidiaries, were terminated. common with Inland and its subsidiaries. 4. Jacobus does not directly or indirectly own, Under the provision of section 2(g)(3) of the control or have power to vote 25 percent or more Act, shares transferred after January 1, 1966, by of any class of voting securities of any bank or any bank holding company to a transferee that has any company that controls a bank. directors or officers in common with the transferor are deemed to be indirectly owned or controlled 1 This information derives from Jacobus' correspondence by the transferor unless the Board, after opportuwith the Board concerning its request for this certification, nity for hearing, determines that the transferor is Jacobus' and Inland's Registration Statements filed with the Board pursuant to the BHC Act, and other records of the Board. not in fact capable of controlling the transferee. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

82 Federal Reserve Bulletin • January 1979 Jacobus has submitted to the Board evidence Sapp Insurance Agency, Inc., to show that it no longer has directors and officers Esbon, Kansas in common with Inland and is not in fact capable Prior Certification Pursuant to the Bank Holding of controlling Inland. This determination is based Company Tax Act of 1976 upon the evidence of record in this matter, in particular the following facts. [Docket No. TCR 76-154] On November 16, 1978 Jacobus distributed to its shareholders, on a pro rata basis, the 340,983 Sapp Insurance Agency, Inc., Esbon, Kansas shares of Inland common stock held by Jacobus. ("Agency"), has requested a prior certification On that date three of Jacobus' directors and of- pursuant to section 1101(b) of the Internal Reveficers were also directors and officers of Inland and nue Code ("Code"), as amended by section 2(a) several of its subsidiaries. Effective April 25 and of the Bank Holding Company Tax Act of 1976, April 30, 1978, two of the directors and officers that its proposed divestiture of all the 375 shares of Jacobus terminated their positions with Inland of Esbon State Bank, Esbon, Kansas ("Bank11), and its subsidiaries, respectively. On July 28, presently held by Agency through the pro rata 1978, the third common director and officer of distribution of such shares to the two shareholders Jacobus and Inland terminated all of his positions of Agency, is necessary or appropriate to effectuwith Jacobus and its subsidiaries. Thus, on July ate the policies of the Bank Holding Company Act 28, 1978, Jacobus and Inland did not have any (12 U.S.C. § 1841 et seq.) ("BHC Act"). directors and officers in common. Further, Jacobus In connection with this request, the following and Inland have committed to the Board that no information is deemed relevant for purposes of person holding an office or position (including an issuing the requested certification:1 advisory or honorary position) with Jacobus or any 1. Agency is a corporation organized under the of its subsidiaries as a director, policy-making laws of the State of Kansas on January 1, 1969. employee or consultant, or who performs (directly, 2. On April 1, 1969, Agency acquired owneror through an agent, representative or nominee) ship and control of 375 shares, representing 75 functions comparable to those normally associated percent of the outstanding voting shares, of Bank. with such office or position, will hold any such Agency has continued to own and control 375 office or position or perform any such function shares, representing 75 percent of the outstanding with Inland or any of its subsidiaries. voting shares of Bank since the acquisition of such Accordingly, it is ordered, that the request of shares. Jacobus for a determination pursuant to section 3. Agency became a bank holding company on 2(g)(3) is granted. This determination is based on December 31, 1970, as a result of the 1970 representations and commitments made to the Amendments to the BHC Act, by virtue of its Board by Jacobus, Inland and the individuals in- ownership and control at that time of more than volved. In the event that the Board should 25 percent of the outstanding voting shares of hereafter determine that facts material to this de- Bank, and it registered as such with the Board termination are otherwise than as represented, or on April 30, 1971. Agency would have been a that Jacobus, Inland or the individuals have failed bank holding company on July 7, 1970, if the BHC to disclose to the Board other material facts, this Act Amendments of 1970 had been in effect on determination may be revoked, and any change such date by virtue of its ownership and control in the facts and circumstances relied upon by the on that date of more than 25 percent of the out- Board in making this determination would result standing voting shares of Bank. in the Board reconsidering the determination made 4. Agency holds property acquired by it on or herein. before July 7, 1970, the disposition of which By order of the Board of Governors, acting would be necessary or appropriate to effectuate through its General Counsel, pursuant to delegated section 4 of the BHC Act if Agency were to authority (12 C.F.R. 265.2(b)(1)), effective De- continue to be a bank holding company beyond cember 27, 1978. December 31, 1980, and which property, is "pro- 1 This information derives from Agency's correspondence signed) GRIFFITH L. GARWOOD, with the Board concerning its request for this certification, Agency's Registration Statement filed with the Board pursuant [SEAL] Deputy Secretary of the Board. to the BHC Act, and other records of the Board. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 83 hibited property" within the meaning of section This certification is based upon the repre- 1103(c) of the Code. sentations made to the Board by Agency and upon On the basis of the foregoing information, it the facts set forth above. In the event the Board is hereby certified that: should hereafter determine that facts material to (A) Agency is a qualified bank holding cor- this certification are otherwise than as represented poration, within the meaning of section 1103(b) by Agency, or that Agency has failed to disclose of the Code, and satisfies the requirements of that to the Board other material facts, it may revoke section; this certification. (B) the 375 shares of Bank that Agency pro- By order of the Board of Governors, acting poses to distribute to its shareholders are all or through its General Counsel, pursuant to delegated part of the property by reason of which Agency authority, (12 C.F.R. § 265.2(b)(3)), effective controls (within the meaning of section 2(a) of the December 11, 1978. BHC Act) a bank or bank holding company; and (C) the distribution of the 375 shares of Bank is necessary or appropriate to effectuate the poli- (Signed) THEODORE E. ALLISON, cies of the BHC Act. [SEAL] Secretary of the Board. ORDERS APPROVED UNDER BANK HOLDING COMPANY ACT By the Board of Governors During December 1978, the Board of Governors approved the applications listed below. Copies are available upon request to Publications Services, Division of Support Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. Section 3 Board action (effective Applicant Bank(s) date) Ankeny Bancshares, Inc., Ankeny National Bank, December 27, 1978 Ankeny, Iowa Ankeny, Iowa First Financial Bancshares, The First National Bank December 27, 1978 Inc., Nevada, Missouri of Mount Vernon, Mount Vernon, Missouri Southwest Florida Banks, Inc. Charlotte County National December 7, 1978 Fort Meyers, Florida Bank, Charlotte County, Florida By Federal Reserve Banks Recent applications have been approved by the Federal Reserve Banks as listed below. Copies of the orders are available upon request to the Reserve Banks. Section 3 Reserve Effective Applicant Bank(s) Bank date Northwest Ohio Bancshares, National Bank of Paulding, Cleveland December 19, 1978 Inc., Toledo, Ohio Paulding, Ohio Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 84 Federal Reserve Bulletin • January 1979 Section 4 Nonbanking company Reserve Effective Applicant (or activity) Bank date Mercantile Bancorporation, Inc., 90 percent of the St. Louis December 5, 1978 St. Louis, Missouri gross loan receivables of Financial Loan and Investment Co., Tulsa, Oklahoma PENDING CASES INVOLVING THE BOARD OF GOVERNORS Does not include suits against the Federal Reserve Banks in which the Board of Governors is not named a party. Consumers Union of the United States v. G. United States League of Savings Associations v. William Miller, et al., filed December 1978, Board of Governors, filed May 1978, U.S.D.C. U.S.D.C. for the District of Columbia. for the District of Columbia. Commercial National Bank, et al., v. Board of Hawkeye Bancorporation v. Board of Governors, Governors, filed December 1978, U.S.C.A. for filed April 1978, U.S.C.A. for the Eighth Cirthe District of Columbia. cuit. Ella Jackson et al. v. Board of Governors, filed Citicorp v. Board of Governors, filed March 1978, November 1978, U.S.C.A. for the Fifth Cir- U.S.C.A. for the Second Circuit. cuit. Security Bancorp and Security National Bank v. United Bank Corporation, New York v. Board Board of Governors, filed March 1978, of Governors, filed November 1978, U.S.C.A. U.S.C.A. for the Ninth Circuit. for the Second Circuit. Michigan National Corporation v. Board of Gov- Metro-North State Bank, Kansas City v. Board ernors, filed January 1978, U.S.C.A. for the of Governors, filed October 1978, U.S.C.A. for Sixth Circuit. the Eighth Circuit. Wisconsin Bankers Association v. Board of Gov- Manchester-Tower Grove Community Organi- ernors, filed January 1978, U.S.C.A. for the zation/ACORN v. Board of Governors, filed District of Columbia. September 1978, U.S.C.A. for the District of Vickars-Henry Corp. v. Board of Governors, filed Columbia. December 1977, U.S.C.A. for the Ninth Cir- Beckley v. Board of Governors, filed July 1978, cuit. U.S.D.C. for the Northern District of Illinois. Emch v. The United States of America, et al., Independent Bankers Association of Texas v. First filed November 1977, U.S.D.C. for the Eastern National Bank in Dallas, et al., filed July 1978, District of Wisconsin. U.S.C.A. for the Northern District of Texas. Corbin v. Federal Reserve Bank of New York, Mid-Nebraska Bancshares, Inc. v. Board of Gov- Board of Governors, et al., filed October 1977, ernors, filed July 1978, U.S.C.A. for the Dis- U.S.D.C. for the Southern District of New trict of Columbia. York. NCNB Corporation v. Board of Governors, filed Central Bank v. Board of Governors, filed Oc- June 1978, U.S.C.A. for the Fourth Circuit. tober 1977, U.S.C.A. for the District of Co- NCNB Corporation v. Board of Governors, filed lumbia. June 1978, U.S.C.A. for the Fourth Circuit. Investment Company Institute v. Board of Gover- Ellis Banking Corporation v. Board of Governors, nors, filed September 1977, U.S.D.C. for the filed May 1978, U.S.C.A. for the Fifth Circuit. District of Columbia. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Law Department 85 BankAmerica Corporation v. Board of Gover- Robert Farms, Inc. v. Comptroller of the Curnors, filed May 1977, U.S.D.C. for the North- rency, et al., filed November 1975, U.S.D.C. ern District of California. for the Southern District of California. BankAmerica Corporation v. Board of Gover- Florida Association of Insurance Agents, Inc. v. nors, filed May 1977, U.S.C.A. for the Ninth Board of Governors, and National Association Circuit. of Insurance Agents, Inc. v. Board of Gover- National Automobile Dealers Association, Inc. v. nors, filed August 1975, actions consolidated Board of Governors, filed November 1976, in U.S.C.A. for the Fifth Circuit. U.S.C.A. for the District of Columbia. David R. Merrill, et al. v. Federal Open Market Memphis Trust Company v. Board of Governors, Committee of the Federal Reserve System, filed filed February 1976, U.S.D.C. for the Western May 1975, U.S.D.C. for the District of Co- District of Tennessee. lumbia. First Lincolnwood Corporation v. Board of Gov- Bankers Trust New York Corporation v. Board ernors, filed February 1976, U.S.C.A. for the of Governors, filed May 1973, U.S.C.A. for Seventh Circuit. the Second Circuit. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Al Financial and Business Statistics CONTENTS Domestic Financial Statistics WEEKLY REPORTING COMMERCIAL BANKS A3 Monetary aggregates and interest rates Assets and Liabilities of— A4 Factors affecting member bank reserves A20 All reporting banks A5 Reserves and borrowings of member A21 Banks in New York City banks A22 Banks outside New York City A6 Federal funds transactions of money A23 Balance sheet memoranda market banks A24 Commercial and industrial loans A25 Gross demand deposits of individuals, POLICY INSTRUMENTS partnerships, and corporations A8 Federal Reserve Bank interest rates A9 Member bank reserve requirements FINANCIAL MARKETS A10 Maximum interest rates payable on time and savings deposits at federally A25 Commercial paper and bankers insured institutions acceptances outstanding A10 Margin requirements A26 Prime rate charged by banks on All Federal Reserve open market short-term business loans transactions A26 Terms of lending at commercial banks All Interest rates in money and capital markets FEDERAL RESERVE BANKS A28 Stock market—Selected statistics A12 Condition and F.R. note statements A13 Maturity distribution of loan and A29 Savings institutions—Selected assets security holdings and liabilities MONETARY AND CREDIT AGGREGATES FEDERAL FINANCE A13 Bank debits and deposit turnover A30 Federal fiscal and financing operations A14 Money stock measures and components A31 U.S. budget receipts and outlays A15 Aggregate reserves and deposits of A32 Federal debt subject to statutory member banks limitation A15 Loans and investments of all A32 Gross public debt of U.S. Treasury— commercial banks Types and ownership A33 U.S. government marketable securities—Ownership, by maturity COMMERCIAL BANK ASSETS AND LIABILITIES A34 U.S. government securities dealers- A16 Last-Wednesday-of-month series Transactions, positions, and financing A17 Call-date series A35 Federal and federally sponsored credit A18 Detailed balance sheet, June 30, 1978 agencies—Debt outstanding Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 2 Federal Reserve Bulletin • January 1979 SECURITIES MARKETS AND International Statistics CORPORATE FINANCE A54 U.S. international transactions— A36 New security issues—State and local Summary governments and corporations A55 U.S. foreign trade A37 Open-end investment companies—Net A55 U.S. reserve assets sales and asset position A56 Foreign branches of U.S. banks— A37 Corporate profits and their distribution Balance sheet data A38 Nonfinancial corporations—Assets and A58 Selected U.S. liabilities to foreign liabilities official institutions A38 Business expenditures on new plant and equipment REPORTED BY BANKS IN THE UNITED STATES: A39 Domestic finance companies—Assets and liabilities; business credit A59 Liabilities to foreigners A61 Banks' own claims on foreigners A62 Banks' own and domestic customers' REAL ESTATE claims on foreigners A40 Mortgage markets A63 Banks' own claims on unaffiliated A41 Mortgage debt outstanding foreigners A63 Liabilities to and claims on foreigners CONSUMER INSTALLMENT CREDIT SECURITIES HOLDINGS AND TRANSACTIONS A42 Total outstanding and net change A64 Marketable U.S. Treasury bonds and A43 Extensions and liquidations notes—Foreign holdings and transactions FLOW OF FUNDS A64 Foreign official assets held at F.R. Banks A44 Funds raised in U.S. credit markets A45 Direct and indirect sources of funds to A65 Foreign transactions in securities credit markets REPORTED BY NONBANKING CONCERNS IN Domestic Nonfinancial Statistics THE UNITED STATES: A66 Short-term liabilities to and claims on A46 Nonfinancial business activity— foreigners Selected measures A67 Long-term liabilities to and claims on A46 Output, capacity, and capacity foreigners utilization A47 Labor force, employment, and unemployment INTEREST AND EXCHANGE RATES A48 Industrial production—Indexes and A68 Discount rates of foreign central banks gross value A68 Foreign short-term interest rates A50 Housing and construction A51 Consumer and wholesale prices A69 Guide to Tabular Presentation A52 Gross national product and income A53 Personal income and saving and Statistical Releases Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Domestic Financial Statistics A3 1.10 MONETARY AGGREGATES AND INTEREST RATES 1977 1978 1978 Item Q4 QL Q2 Q3 July Aug. Sept. Oct. Nov. Monetary and credit aggregates (annual rates of change, seasonally adjusted in per cent)12 Member bank reserves 1 Total 6.3 8.8 6.6 8.2 14.0 -8.2 8.1 7.6 -5.3 2 Required 6.4 9.3 7.2 8.2 13.4 -7.4 7.4 8.3 -7.1 3 Nonborrowed 3.8 14.4 1.1 6.2 7.6 -3.2 10.7 1.3 11.7 Concepts of money1 4 M-l 7.5 6.2 9.9 7.6 4.8 8.5 14.1 3.7 -4.6 5 M-l 4- 6.8 4.9 6.9 5.3 1.5 8.7 12.2 1.8 -7.1 6 M-2 8.1 6.9 7.9 8.9 8.0 10.4 12.5 7.0 4.3 7 M-3 10.6 7.7 7.8 10.1 9.4 11.7 14.0 '9.6 6.7 Time and savings deposits Commercial banks: 8 Total 13.0 12.8 10.1 9.5 10.2 7.5 13.8 7.9 23.7 9 Savings 5.4 2.6 1.6 1.3 -4.3 8.1 9.7 -1.6 -11.3 10 Other time 11.6 11.4 10.5 17.3 22.5 14.2 13.6 17.7 27.7 11 Thrift institutions 2 14.4 8.9 7.6 11.6 11.2 13.9 16.0 '13.6 9.9 12 Total loans and investments at commercial banks 3 9.9 r10.1 '14.9 r10.8 '11.0 '5.1 '9.7 '9.8 6.5 1978 1978 QL Q2 Q3 Q4 Aug. Sept. Oct. Nov. Dec. Interest rates (levels, per cent per annum) Short-term rates 13 Federal funds4 6.76 7.28 8.09 9.58 8.04 8.45 8.96 9.76 10.03 14 Federal Reserve discount5 6.46 6.78 7.50 9.09 7.43 7.83 8.26 9.50 9.50 15 Treasury bills (3-month market yield)6 6.39 6.48 7.31 8.57 7.08 7.85 7.99 8.64 9.08 16 Commercial paper (90- to 119-day)6-7 6.76 7.16 8.03 9.83 7.83 8.39 8.98 10.14 10.37 Long-term rates Bonds: 17 U.S. Government8 8.19 8.43 8.53 8.78 8.45 8.47 8.69 8.75 8.90 18 State and local government 9 5.65 6.02 6.16 6.28 6.12 6.09 6.13 6.19 6.51 19 Aaa utility (new issue)10 8.70 8.98 8.94 9.23 8.82 8.86 9.17 9.27 9.28 20 Conventional mortgages11 9.23 9.58 9.80 9.71 9.80 9.80 9.95 10.10 9.30 1 M-l equals currency plus private demand deposits adjusted. 6 Ouoted on a bank-discount basis. M-1 + equals M-l plus savings deposits at commercial banks, NOW 7 Beginning Nov. 1977, unweighted average of offering rates quoted by accounts at banks and thrift institutions, credit union share draft ac- five dealers. Previously, most representative rate quoted by these dealers. counts, and demand deposits at mutual savings banks. 8 Market yields adjusted to a 20-year maturity by the U.S. Treasury. M-2 equals M-l plus bank time and savings deposits other than large 9 Bond Buyer series for 20 issues of mixed quality. negotiable certificates of deposit (CD's). 10 Weighted averages of new publicly offered bonds rated Aaa, Aa, M-3 equals M-2 plus deposits at mutual savings banks, savings and and A by Moody's Investors Service and adjusted to an Aaa basis. loan associations, and credit union shares. Federal Reserve compilations. 2 Savings and loan associations, mutual savings banks, and credit 11 Average rates on new commitments for conventional first mortgages unions. on new homes in primary markets, unweighted and rounded to nearest 3 Quarterly changes calculated from figures shown in Table 1.23. 5 basis points, from Dept. of Housing and Urban Development. 4 Seven-day averages of daily effective rates (average of the rates on 12 Unless otherwise noted, rates of change are calculated from average a given date weighted by the volume of transactions at those rates). amounts outstanding in preceding month or quarter. 5 Rate for the Federal Reserve Bank of New York. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A4 Domestic Nonfinancial Statistics • January 1979 1.11 FACTORS AFFECTING MEMBER BANK RESERVES Millions of dollars Monthly averages of daily Weekly averages of daily figures for weeks ending— figures Factors 1978 1978 Oct. Nov. Dec.0 Nov. 15 Nov. 22 Nov. 29 Dec. 6 Dec. 13 Dec. 20p Dec. 27? SUPPLYING RESERVE FUNDS 1 Reserve Bank credit outstanding.... 133,273 129,544 129,428 126,996 130,417 130,654 129,443 125,697 129,704 131,385 2 115,008 111,243 109,255 109,186 110,556 111,842 111,442 107,597 109,902 107,835 3 Bought outright 111133,,997777 111100,,772288 110088,,778800 110099,,118866 109,689 111,336 110,600 107,572 110099,,779988 107,375 4 Held under repurchase agreement 1,031 515 475 867 506 842 25 104 460 5 Federal agency securities 8,353 8,109 8,089 7,932 8,343 8,060 8,164 7,912 7,942 8,212 6 Bought outright 77,,994400 7,928 7,897 7,932 7,932 7,918 7,899 7,898 7,896 7,896 7 Held under repurchase agree- 413 181 192 411 142 265 14 46 316 8 249 180 167 455 141 258 37 6 110 9 Loans 1,261 722 874 633 604 792 698 591 567 1,413 10 Float 5,742 6,588 7,521 6,176 8,269 7,554 6,468 7,006 7,383 9,342 11 Other Federal Reserve assets.... 2,660 2,702 3,522 3,068 2,190 2,265 2,413 2,554 3,904 4,473 12 Gold stock 11,660 11,645 11,635 11,642 11,642 11,642 11,642 11,639 11,611 11,628 13 Special Drawing Rights certificate account 1,300 1,300 1,300 1,300 1,300 11,,330000 1,300 1,300 1,300 1,300 14 Treasury currency outstanding 11,725 11,779 11,827 11,768 11,787 11,803 11,805 11,822 11,822 11,844 ABSORBING RESERVE FUNDS 15 Currency in circulation 108,872 110,929 113,395 110,775 111,242 111,913 112,061 112,862 113,329 114,377 16 Treasury cash holdings 303 278 261 278 279 273 272 271 261 245 Deposits, other than member bank reserves with F.R. Banks: 17 Treasury 14,948 8,186 3,931 8,092 6,443 6,468 5,299 2,120 3,748 4,952 18 Foreign 300 289 301 273 286 298 308 266 292 320 19 Other2 590 540 724 521 529 556 618 731 666 620 20 Other F.R. liabilities and capital.... 44,,224444 44,,119933 4,322 4,008 4,284 4,475 4,303 4,069 4,367 4,548 21 Member bank reserves with F.R. Banks 28,701 29,853 31,256 27,759 32,085 31,416 31,328 30,139 31,775 31,096 End-of-month figures Wednesday figures 1978 1978 Oct. Nov. Dec.f Nov. 15 Nov. 22 Nov. 29 Dec. 6 Dec. 13 Dec. 20p Dec. 27p SIJPPT .YINC. RF.SF.RVE FUNDS 22 Reserve Bank credit outstanding. ... 132,022 131,605 131,398 127,622 131,955 132,830 123,783 129,046 130,237 137,046 23 U.S. Government securities1. ..... 115,322 113,305 110,562 108,114 111,203 114,110 104,361 110,558 107,104 111,639 24 Bought outright 114,659 113,305 109,478 108,114 110,878 112,110 104,361 110,558 107,104 109,583 25 Held under repurchase agree- 663 11,,008844 332255 22,,000000 22,,005566 26 8,065 7,899 8,029 7,932 8,092 8,524 7,899 7,896 7,896 9,165 27 Bought outright 7,938 7,899 7,896 7,932 7,932 7,899 7,899 7,896 7,896 7,896 28 Held under repurchase agree- 127 133 116600 625 11,,226699 29 Acceptances 236 587 383 370 444 30 1,207 813 1,172 1,258 933 1,270 586 472 502 3,111 31 Float 4,436 7,238 6,505 8,042 9,146 6,151 8,473 7,619 10,393 8,066 32 Other Federal Reserve assets.... 2,756 2,350 4,543 2,276 2,198 2,405 2,464 2,501 4,342 4,621 33 Gold stock 11,655 11,642 11,671 11,642 11,642 11,642 11,640 11,635 11,611 11,671 34 Special Drawing Rights certificate 1,300 1,300 1,300 1,300 1,300 1,300 1,300 1,300 1,300 1,300 35 Treasury currency outstanding. 11,731 11,790 11,846 11,778 11,799 11,804 11,810 11,822 11,822 11,846 ABSORBING RESERVE FUNDS 36 Currency in circulation 109,307 112,072 114,648 111,277 111,820 112,327 112,729 113,477 114,075 115,227 37 276 267 250 277 275 273 271 271 250 241 Deposits, other than member bank reserves with F.R. Banks: 38 Treasury 15,467 6,587 4,196 7,557 6,153 7,236 2,169 1,869 4,500 3,540 39 305 379 368 313 285 275 367 204 275 285 40 Other2 531 567 1,256 448 565 479 553 582 582 613 41 Other F.R. liabilities and capital. .. 44,,556600 44,,554455 4,275 44,,114444 44,,227799 44,,558844 33,,779966 44,,228855 4,499 4,704 42 Member bank reserves with F.R. Banks 26,260 31,919 31,223 28,327 33,320 32,402 28,648 33,116 30,788 37,254 1 Includes securities loaned—fully guaranteed by U.S. Govt, securities voluntarily held with member banks and redeposited in full with Federal pledged with F.R. Banks—and excludes (if any) securities sold and sched- Reserve Banks. uled to be bought back under matched sale-purchase transactions. NOTE.—For amounts of currency and coin held as reserves, see Table 2 Includes certain deposits of foreign-owned banking institutions 1.12. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Member Banks A5 1.12 RESERVES AND BORROWINGS Member Banks Millions of dollars Monthly averages of daily figures Reserve classification 1977 1978 Dec. Apr. May June July Aug. Sept. Oct. Nov. Dec.f All member banks Reserves: 1 At F.R. Banks 27,057 27,776 27,890 27,840 28,570 28,079 28,010 28,701 29,853 31,256 2 Currency and coin 9,351 9,028 9,151 9,345 9,542 9,512 9,605 9,654 9,794 10,337 3 Total held * 36,471 36,880 37,119 37,262 38,189 37,666 37,689 38,434 39,728 41,669 4 Required 36,297 36,816 36,867 37,125 38,049 37,404 37,614 38,222 39,423 41,487 5 Excess1 174 64 252 137 140 262 75 212 305 182 Borrowings at F.R. Banks:2 6 Total 558 539 1,227 1,111 1,286 1,147 1,068 1,261 722 874 7 Seasonal 54 43 93 120 143 188 191 221 185 134 Large banks in New York City 8 Reserves held 6,244 6,247 6,315 6,341 6,606 6,334 6,182 6,428 6,682 7,091 9 Required 6,279 6,320 6,236 6,376 6,581 6,290 6,251 6,349 6,658 7,243 10 Excess -35 -73 79 -35 25 44 -69 79 24 -152 11 Borrowings2 48 61 113 54 129 58 78 157 48 99 Large banks in Chicago 12 Reserves held 1,593 1,670 1,697 1,668 1,708 1,648 1,655 1,672 1,791 1,870 13 Required 1,613 1,686 1,669 1,670 1,707 1,646 1,650 1,649 1,765 1,894 14 Excess -20 -16 28 -2 2 5 23 26 -24 15 Borrowings2 26 11 19 20 20 3 35 14 4 9 Other large banks 16 Reserves held 13,993 14,135 14,106 14,250 14,553 14,502 14,564 14,862 15,547 16,393 17 Required 13,931 14,077 14,079 14,225 14,569 14,423 14,541 14,867 15,447 16,335 18 Excess 62 58 27 25 -16 79 23 -5 100 58 19 Borrowings2 243 249 500 536 499 417 363 408 194 275 All other banks 20 Reserves held 14,641 14,828 15,001 15,003 15,322 15,182 15,288 15,472 15,708 15,991 21 Required 14,474 14,733 14,883 14,854 15,192 15,045 15,172 15,357 15,553 16,015 22 Excess 167 95 118 149 130 137 116 115 155 -24 23 Borrowings2 241 218 595 501 638 669 592 682 476 491 Weekly averages of daily figures for weeks ending— 1978 Oct. 25 Nov. 1 Nov. 8 Nov. 15 Nov. 29 Dec. 6 Dec. 13 Dec. 20p All member banks Reserves: At F.R. Banks 28,887 28,467 27,777 27,759 32,085 31,416 31,328 30,139 31,775 Currency and coin 9,101 9,861 10,071 10,132 9,144 9,785 10,056 10,843 10,025 Total held1 38,068 38,408 37,927 37,974 41,312 41,283 41,465 41,063 41,873 Required 37,749 38,295 37,586 37,729 41,162 41,130 41,138 40,911 41,808 Excess1 319 113 341 245 150 153 327 152 65 Borrowings at F.R. Banks:2 Total 1,313 1,305 696 633 604 792 698 591 567 Seasonal 235 233 191 188 182 180 150 131 131 Large banks in New York City 31 Reserves held 6,100 6,286 6,240 6,222 7,170 6,968 7,300 7,339 32 Required 6,026 6,313 6,199 6,257 7,162 6,980 7,236 7,300 33 Excess 74 -27 41 -35 8 -12 64 39 34 Borrowings2 75 99 102 4 31 Large banks in Chicago Reserves held 1,569 1.659 1,621 1,605 1,997 1,886 1,891 1,862 ,904 Required 1,569 1.660 1,603 1,587 1,985 1,881 1,913 1,867 ,937 Excess 18 18 12 5 -22 -5 -33 Borrowings2 12 10 9 2 6 10 6 Other large banks 39 Reserves held... 14,868 14,888 14,740 14,812 16,136 16,323 16,206 16,174 16,337 40 Required 14,738 14,877 14,621 14,758 16,145 16,255 16,093 16,133 16,378 41 Excess 130 119 54 -9 68 113 41 -41 42 Borrowings2.... 428 349 191 137 169 236 176 193 106 All other banks 43 Reserves held. 15,531 15,575 15,326 15,335 16,009 16,106 16,068 15,905 15,942 44 Required... 15,416 15,445 15,163 15.127 15,870 16,014 15,896 15,781 16,193 45 Excess 115 130 163 '208 139 92 172 124 -251 46 Borrowings 2.. 798 847 496 394 429 519 522 388 455 l Adjusted to include waivers of penalties for reserve deficiencies in nonmember bank joins the Federal Reserve System. For weeks for which accordance with Board policy, effective Nov. 19, 1975, of permitting figures are preliminary, figures by class of bank do not add to total transitional relief on a graduated basis over a 24-month period when a because adjusted data by class are not available. nonmember bank merges into an existing member bank, or when a 2 Based on closing figures. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A6 Domestic Nonfinancial Statistics • January 1979 1.13 FEDERAL FUNDS TRANSACTIONS Money Market Banks Millions of dollars, except as noted 1978, week ending- Type Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 Total, 46 banks Basic reserve position 1 Excess reserves1 16 111 141 -31 75 169 127 166 -40 LESS: 2 Borrowings at F.R. Banks. . 205 59 106 38 168 62 81 1 590 3 Net interbank federal funds transactions 14,187 17,146 17,945 16,936 15,861 15,823 17,468 15,421 15,136 EQUALS: Net surplus, or deficit (-): 4 Amount -14,376 -17,094 -17,910 -17,004 -15,954 -15,716 -17,422 -15,256 -15,765 5 Percent of average required reserves 89.5 108.6 113.0 94.7 90.0 87.7 97.7 83.7 88.1 Interbank federal funds transactions Gross transactions: Purchases 22,604 24,484 24,690 24,077 23,743 23,567 23,265 23,624 22,886 Sales 8,417 7,339 6,744 7,141 7,881 7,744 5,797 8,203 7,750 Two-way transactions2 5,521 5,676 5,506 5,336 5,580 5,965 4,952 6,135 5,854 Net transactions: Purchases of net buying banks.. 17,083 18,808 19,184 18,742 18,162 17,602 18,313 17,489 17,032 Sales of net selling banks 2,896 1,663 1,239 1,806 2,301 1,778 845 2,068 1,896 Related transactions with U.S. government securities dealers 11 Loans to dealers3 2,986 4,207 3,654 4,123 3,298 3,833 5,153 3,857 4,606 12 Borrowing from dealers4 2,241 1,646 1,270 2,005 1,714 1,831 1,590 1,226 1,865 13 Net loans 745 2,561 2,384 2,118 1,584 2,002 3,564 2,631 2,740 8 banks in New York City Basic reserve position 14 Excess reserves1 4455 5 4 -7 4488 3377 112288 --6611 LESS: 15 Borrowings at F.R. Banks. . 69 102 27 331122 16 Net interbank federal funds transactions 3,774 4,267 4,666 2,523 2,336 2,529 4,136 2,816 3,134 EQUALS: Net surplus, or deficit (-): Amount -3,843 -4,221 -4,763 -2,519 -2,370 -2,481 -4,099 -2,688 -3,507 Percent of average required reserves 67.5 75.3 84.6 39.0 37.6 37.8 63.4 40.6 55.1 Interbank federal funds transactions Gross transactions: Purchases 5,404 5,595 5,593 4,785 4,687 4,281 4,894 4,940 4,658 Sales 1,630 1,328 927 2,262 2,351 1,752 758 2,124 1,523 Two-way transactions2 1,090 1,303 927 1,246 1,441 1,182 758 1,500 1,379 Net transactions: Purchases of net buying banks.. 4,314 4,292 4,666 33,,553388 3,246 3,099 4,136 33,,444400 33,,227788 Sales of net selling banks 540 25 11,,001166 911 570 662244 114444 Related transactions with U.S. government securities dealers 24 Loans to dealers3 1,773 2,718 2,249 22,,552244 1,864 2,114 2,970 22,,338822 33,,006666 25 Borrowing from dealers4 510 454 496 663333 "59 659 609 445500 442200 26 Net loans 1,263 2,264 1,753 11,,889911 1,106 1,455 2,361 11,,993322 22,,664466 38 banks outside New York City Basic reserve position 27 Excess reserves1 16 65 136 -34 81 121 91 38 21 LESS: 28 Borrowings at F.R. Banks. . 137 59 4 38 141 62 81 1 278 29 Net interbank federal funds transactions 10,413 12,879 13,279 14,413 13,525 13,294 13,332 12,605 12,002 EQUALS: Net surplus, or deficit (-): 30 Amount -10,534 -12,873 -13,147 -14,485 -13,585 -13,235 -13,323 -12,567 -12,258 31 Percent of average required reserves 101.5 126.9 128.5 125.9 118.8 116.5 117.2 108.3 106.3 Interbank federal funds transactions Gross transactions: Purchases 17,200 18,889 19,097 19,293 19,056 19,286 18,371 18,684 18,229 Sales 6,786 6,010 5,818 4,879 5,530 5,992 5,039 6,079 6,227 Two-way transactions2 4,431 4,373 4,579 4,089 4,140 4,783 4,194 4,635 4,475 Net transactions: Purchases of net buying banks.. 12,769 14,517 14,518 15,203 14,916 14,503 14,177 14,049 13,754 Sales of net selling banks 2,356 1,639 1,239 790 1,391 1,208 845 1,444 1,752 Related transactions with U.S. government securities dealers 37 Loans to dealers3 1,212 1,489 1,405 1,598 1,434 1,718 2,183 1,475 1,540 38 Borrowing from dealers4 1,731 1,192 774 1,372 956 1,172 981 776 1,446 39 Net loans -518 297 631 226 478 547 1,202 699 94 For notes see end of table. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Funds Al 1.13 Continued 1978, week ending— Type Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 5 banks in City of Chicago Basic reserve position 40 Excess reserves1 13 1 8 20 41 19 15 -19 23 LESS: 41 Borrowings at F.R. Banks 2299 42 Net interbank federal funds transactions 4,965 5,685 5,713 6,194 6,059 5,424 5,930 6, All 6,025 EQUALS: Net surplus, or deficit (-): 43 Amount --44,,995511 -5,684 --55,,770055 -6,174 --66,,001177 -5,405 -5,915 --66,,449977 --66,,003300 44 Percent of average required reserves 318.5 375.4 380.9 331.3 344.4 304.1 341.6 355.2 348.9 Interbank federal funds transactions Gross transactions: 45 Purchases 6,348 6,703 7,065 7,363 7,134 7,030 7,082 1,104 7,183 46 Sales 1,384 1,018 1,352 1,169 1,075 1,606 1,153 1,226 1,158 47 Two-way transactions2 1,384 1,018 1,352 1,169 1,075 1,606 1,153 1,189 1,101 Net transactions: 48 Purchases of net buying banks... 44,,996644 5,685 55,,771133 66,,119944 66,,005599 5,424 55,,993300 6,515 6,083 4499 Sales of net selling banks 3388 5588 Related transactions with U.S. government securities dealers 50 Loans to dealers3 79 119911 124 214 236 216 215 300 259 51 Borrowing from dealers4 201 224 56 173 229 354 276 160 417 52 Net loans -122 -33 68 41 7 -139 -60 140 -158 33 other banks Basic reserve position 53 Excess reserves1 3 64 112299 -54 40 102 76 58 -2 LESS: 54 Borrowings at F.R. Banks 137 59 4 38 141 62 81 1 249 55 Net interbank federal funds transactions 5,449 7,194 7,566 8,220 7,467 7,871 7,403 6,128 5,977 EQUALS : Net surplus, or deficit (-): 56 Amount --55,,558833 -7,189 -7,441 -8,311 -7,568 --77,,883300 --77,,440088 --66,,007711 --66,,222288 57 Percent of average required reserves 63.2 8833..33 8855..00 8866..22 78.1 81.7 76.9 62.1 63.5 Interbank federal funds transactions Gross transactions: 58 Purchases 10,852 12,186 12,032 11,930 11,922 12,256 11,289 10,981 11,045 59 Sales 5,403 4,992 4,466 3,710 4,455 4,385 3,886 4,853 5,068 60 Two-way transactions2 3,047 3,355 3,227 2,920 3,064 3,177 33,,004411 33,,444466 33,,337744 Net transactions: 61 Purchases of net buying banks... 7,805 8,832 8,805 9,009 8,857 9,079 8,248 7,534 7,671 62 Sales of net selling banks 2,356 1,638 1,239 790 1,391 1,208 845 1,406 1,694 Related transactions with U.S. government securities dealers 63 Loans to dealers3 1,134 1,299 11,,228822 1,384 1,198 1,503 1,968 1,175 1,281 64 Borrowing from dealers4 1,530 968 718 1,199 727 818 705 616 1,029 65 Net loans -396 330 564 186 471 685 1,263 559 252 1 Based on reserve balances, including adjustments to include waivers 4 Federal funds borrowed, net funds acquired from each dealer by of penalties for reserve deficiencies in accordance with changes in policy clearing banks, reverse repurchase agreements (sales of securities to of the Board of Governors effective Nov. 19, 1975. dealers subject to repurchase), resale agreements, and borrowings secured 2 Derived from averages for individual banks for entire week. Figure by U.S. Govt, or other securities. for each bank indicates extent to which the bank's average purchases and sales are offsetting. NOTE.—Weekly averages of daily figures. For description of series, 3 Federal funds loaned, net funds supplied to each dealer by clearing see August 1964 BULLETIN, pp. 944-53. Back data for 46 banks appear banks, repurchase agreements (purchases from dealers subject to resale), in the Board's Annual Statistical Digest, 1971-1975, Table 3. or other lending arrangements. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A8 Domestic Financial Statistics • January 1979 1.14 FEDERAL RESERVE BANK INTEREST RATES Per cent per annum Current and previous levels Loans to member banks— Loans to all others Under Sec. 10(b)2 under Sec. 13, last par.* Federal Reserve Under Sees. 13 and 13ai Bank Regular rate Special rate 3 Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous Rate on Effective Previous 12/31/78 date rate 12/31/78 date rate 12/31/78 date rate 12/31/78 date rate Boston 9% 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% New York 9% 11/1/78 8% 10 11/1/78 10% 11/1/78 9% 12% 11/1/78 11% Philadelphia 9% 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% Cleveland 9% 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% Richmond 91/2 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% Atlanta 9% 11/3/78 8Vi 10 11/3/78 10% 11/3/78 9% 12% 11/3/78 11% Chicago 91/2 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% St. Louis 9% 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% Minneapolis 9% 11/1/78 8% 10 11/1/78 10% 11/1/78 9% 12% 11/1/78 11% Kansas City 9% 11/2/78 81/2 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% Dallas 9% 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% San Francisco... 9% 11/2/78 8% 10 11/2/78 10% 11/2/78 9% 12% 11/2/78 11% Range of rates in recent years 5 Range F.R. Range F.R. Range F.R. Effective date (or level)— Bank Effective date (or level)— Bank Effective date (or level)— Bank All F.R. of All F.R. of All F.R. of Banks N.Y. Banks N.Y. Banks N.Y. In effect Dec. 31, 1970 5% 5% 1973—May 4. 5*4 5*4 1976—Jan. 19 5%-6 5% 11. 5*4-6 6 23 5% 5% 1971—Jan. 1 1 8 5 9 ... 5!4 5 5 % - - 5 5 % V 4 5 5 5 V V % 4 4 June 1 1 1 5 8 1 . . . 6 6% 6 - 6% 6 6 6 % % Nov. 2 2 2 6 . 51 5 4 1 - / 5 4 % 5 51 1 / 4 4 22 5-5% 5 July 2. 7 7 1977—Aug. 30 514-534 51/4 29 5 5 Aug. 14. 7-7% 7% 31 514-534 534 Feb. 1 19 3 ... 4* 4 4 % -5 4 5 % 23. 7% 7% O Se c p t. t . 26 2 5 6 34 5 6 *4 July 16 434-5 5 1974—Apr. 25, 7%-8 8 23 5 30. 8 8 1978—Jan. 9 6-6% 6% Nov 11... 4*4-5 5 Dec. 9. 734-8 7*4 20 6% 6% 19... 4*4 434 16. 734 7*4 May 11 6%-7 7 Dec. 13... 4%-4*4 434 12 7 7 2 1 4 7 . ... 4% 4% -4 *4 4 4 % % 1975—Jan. 1 6 0 . . 7 7 1 1 4 4 - - 7 7 3 3 4 4 7 7 * 14 4 July 1 3 0 7 7 1 -7 4 14 7 7 1 1 4 4 1973—Jan. 15 5 5 Feb. 24 5 . . 6* 7 4 1 - / 7 4 1 4 7 6 1 * 4 4 A Se u p g t . . 2 2 1 2 7 8 3 4 7 8 * 4 M A Fe p a b r r . . . 2 26 2 3 .. 5% 5 5% - - 5 5 * % 4 5 5 5 % % % Mar. 1 1 7 0 4 . . . 61 6 6 4 1 3 -6 4 4 3 4 6 6 6 1 * 1 4 4 4 N O o ct v . . 2 1 1 0 6 8% 8 8 % - - 9 8 % % 9 8 8 % % % May 16. 6-614 6 3 9% 9% 23, 6 6 In effect Dec. 31, 1978 9% 9% 1 Discounts of eligible paper and advances secured by such paper or by 4 Advances to individuals, partnerships, or corporations other than U.S. govt, obligations or any other obligations eligible for F.R. Bank member banks secured by direct obligations of, or obligations fully purchase. guaranteed as to principal and interest by, the U.S. govt, or any agency 2 Advances secured to the satisfaction of the F.R. Bank. Advances thereof. secured by mortgages on 1- to 4-family residential property are made at 5 Rates under Sees. 13 and 13a (as described above). For description the Section 13 rate. and earlier data, see the following publications of the Board of Governors: 3 Applicable to special advances described in Section 201.2(e)(2) of Banking and Monetary Statistics, 1914-1941, Banking and Monetary Regulation A. Statistics, 1941-1970, Annual Statistical Digest, 1971-75, and Annual Statistical Digest, 1972-76. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments A9 1.15 MEMBER BANK RESERVE REQUIREMENTS1 Per cent of deposits Requirements in effect Previous requirements December 31, 1978 TTyyppee ooff ddeeppoossiitt,, aanndd ddeeppoossiitt iinntteerrvvaall iinn mmiilllliioonnss ooff ddoollllaarrss Per cent Effective date Per cent Effective date Net demand:2 7 12/30/76 m 2/13/75 12/30/76 10 2/13/75 1 1 0 0 - 0 1 - 0 4 0 0 0 n 12 y y4 4 1 12 2 / / 3 3 0 0 / / 7 7 6 6 1 1 3 2 2 2 / / 1 1 3 3 / / 7 7 5 5 Over 400 I6V4 12/30/76 16 % 2/13/75 Time:2-3-4 Savings 3 3/16/67 3% 3/2/67 Other time:5 0-5, maturing in— 30-179 days 3 3/16/67 3% 3/2/67 180 days to 4 years 2 % 1/8/76 3 3/16/67 4 years or more 1 10/30/75 3 3/16/67 Over 5, maturing in— 30-179 days 6 12/12/74 5 10/1/70 180 days to 4 years 2 % 1/8/76 3 12/12/74 4 years or more 1 10/30/75 3 12/12/74 Legal limits Minimum Maximum Net demand: Reserve city banks Other banks Time Borrowings from foreign banks 1 For changes in reserve requirements beginning 1963, see Board's (c) Effective August 24, 1978, the Regulation M reserve requirements Annual Statistical Digest, 1971-1975 and for prior changes, see Board's on net balances due from domestic banks to their foreign branches and Annual Report for 1976, Table 13. on deposits that foreign branches lend to U.S. residents were reduced to 2 (a) Requirement schedules are graduated, and each deposit interval zero from 4 per cent and 1 per cent, respectively. The Regulation D applies to that part of the deposits of each bank. Demand deposits reserve requirement on borrowings from unrelated banks abroad was subject to reserve requirements are gross demand deposits minus cash also reduced to zero from 4 per cent. items in process of collection and demand balances due from domestic 3 Negotiable orders of withdrawal (NOW) accounts and time deposits banks. such as Christmas and vacation club accounts are subject to the same (b) The Federal Reserve Act specifies different ranges of requirements requirements as savings deposits. for reserve city banks and for other banks. Reserve cities are designated 4 The average reserve requirement on savings and other time deposits under a criterion adopted effective Nov. 9, 1972, by which a bank having must be at least 3 per cent, the minimum specified by law. net demand deposits of more than $400 million is considered to have the 5 Effective November 2, 1978, a supplementary reserve requirement of character of business of a reserve city bank. The presence of the head 2 per cent was imposed on time deposits of $100,000 or more, obligations office of such a bank constitutes designation of that place as a reserve of affiliates, and ineligible acceptances. city. Cities in which there are Federal Reserve Banks or branches are also reserve cities. Any banks having net demand deposits of $400 million or NOTE.—Required reserves must be held in the form of deposits with less are considered to have the character of business of banks outside of F.R. Banks or vault cash. reserve cities and are permitted to maintain reserves at ratios set for banks not in reserve cities. For details, see the Board's Regulation D. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A10 Domestic Nonfinancial Statistics • January 1979 1.16 MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions Per cent per annum Commercial banks Savings and loan associations and mutual savings banks Type and maturity of deposit In effect Dec. 31, 1978 Previous maximum In effect Dec. 31, 1978 Previous maximum Per cent Effective Per cent Effective Per cent Effective Per cent date date date 1 Savings 5 7/1/73 4% 1/21/70 5% (7) 5 2 Negotiable orders of withdrawal accounts1 5 1/1/74 (10) 5 1/1/74 (10) 3 Money market time deposit of less than $100,0002 (9) (9) (9) (9) (9) (9) (9) Other time (multiple- and singlematurity unless otherwise indicated)3 30-89 days: 4 Multiple-maturity 7/1/73 4% 1/21/70 (10) 5 Single-maturity 5 9/26/66 90 days to 1 year: 6 7 S M in u g lt l i e p -m le- a m tu a r t i u ty r ity 5Vi 7/1/73 7 9/ / 2 2 6 0 / / 6 6 6 6 45 y 4 (7) 5% 10 9 8 2 2 1 i / t t 2 o o t 2 2 o y y 4 2 e y y a e e r a a s4 r r s s 4 4 6 6 V1 7 7/ / 1 1 / / 7 7 3 3 s 5 5V 1 y / 4 a 2 1 1 1 / / / 2 2 2 1 1 1/ / / 7 7 7 0 0 0 6 e 1 y /2 4 ( ( 7 7 ) ) 6 6 s y 4 1 1 1 1 2 3 6 4 8 y t t o o e a 6 8 r s y y e e o a a r r r m s s 5 5 o re 5 m m m 12 1 6 / 1 2 / / 1 1 3 / / / 7 7 7 8 3 4 C ( 7 1 1 1 0 1 / ) ) 4 11/1/73 7 7 8 1 y / 4 2 1 1 2 6 1 /2 / / 1 1 3 / / / 7 7 7 8 3 4 O ( 7 1 1 1 / 0 ) 2 ) 14 Issued to governmental units (all maturities) 6/1/78 m 12/23/74 8 6/1/78 m 15 Individual retirement accounts and Keogh (H.R. 10) plans6 6/1/78 m 7/6/77 8 6/1/78 m 1 For authorized States only. Federally insured commercial banks, higher than the rate for commercial banks. The most recent rates and savings and loan associations, cooperative banks, and mutual savings effective dates are as follows: banks in Massachusetts and New Hampshire were first permitted to offer negotiable orders of withdrawal (NOW) accounts on Jan. 1, 1974. Authorization to issue NOW accounts was extended to similar institutions Nov. 30 Dec. 7 Dec. 14 Dec. 21 Dec. 28 throughout New England on Feb. 27, 1976, and in New York State on Nov. 10, 1978. 2 Must have a maturity of exactly 26 weeks and a minimum denomina- 9.330 9.220 9.263 9.524 9.580 tion of $10,000, and must be nonnegotiable. Thrifts 9.580 9.470 9.513 9.774 9.830 3 For exceptions with respect to certain foreign time deposits see the Federal Reserve BULLETIN for October 1962 (p. 1279), August 1965 (p. 1094), and February 1968 (p. 167). 10 No separate account category. 4 A minimum of $1,000 is required for savings and loan associations, 11 Between July 1, 1973, and Oct. 31, 1973, there was no ceiling for except in areas where mutual savings banks permit lower minimum de- certificates maturing in 4 years or more with minimum denominations nominations. This restriction was removed for deposits maturing in less of $1,000; however, the amount of such certificates that an institution than 1 year, effective Nov. 1, 1973. could issue was limited to 5 per cent of its total time and savings deposits. 5 $1,000 minimum except for deposits representing funds contributed Sales in excess of that amount, as well as certificates of less than $1,000, to an Individual Retirement Account (IRA) or a Keogh (H.R. 10) Plan es- were limited to the 6l/z per cent ceiling on time deposits maturing in 2l/i tablished pursuant to the Internal Revenue Code. The $1,000 minimum years or more. requirement was removed for such accounts in December 1975 and No- Effective Nov. 1, 1973, ceilings were reimposed on certificates maturing vember 1976, respectively. in 4 years or more with minimum denominations of $1,000. There is no 6 3-year minimum maturity. limitation on the amount of these certificates that banks can issue. 7 July 1, 1973, for mutual savings banks; July 6, 1973, for savings and loan associations. NOTE—Maximum rates that can be paid by Federally insured commer- 8 Oct. 1, 1966, for mutual savings banks; Jan. 21, 1970, for savings and cial banks, mutual savings banks, and savings and loan associations are loan associations. established by the Board of Governors of the Federal Reserve System, 9 Commercial banks, savings and loan associations, and mutual savings the Board of Directors of the Federal Deposit Insurance Corporation, banks were authorized to offer money market time deposits effective and the Federal Home Loan Bank Board under the provisions of 12 June 1, 1978. The ceiling rate for commercial banks is the discount rate CFR 217, 329, and 526, respectively. The maximum rates on time deon most recently issued 6-month U.S. Treasury bills. The ceiling rate for posits in denominations of $100,000 or more were suspended in midsavings and loan associations and mutual savings banks is l/4 per cent 1973. For information regarding previous interest rate ceilings on all types of accounts, see earlier issues of the Federal Reserve BULLETIN, the Federal Home Loan Bank Board Journal, and the Annual Report of the Federal Deposit Insurance Corporation. 1.161 MARGIN REQUIREMENTS Per cent of market value; effective dates shown. Type of security on sale Mar. 11, 1968 June 8, 1968 May 6, 1970 Dec. 6, 1971 Nov. 24, 1972 Jan. 3, 1974 1 Margin stocks 70 80 65 55 65 50 2 Convertible bonds 50 60 50 50 50 50 3 Short sales 70 80 65 55 65 50 NOTE.—Regulations G, T, and U of the Federal Reserve Board of difference between the market value (100 per cent) and the maximum Governors, prescribed in accordance with the Securities Exchange Act of loan value. The term "margin stocks" is defined in the corresponding 1934, limit the amount of credit to purchase and carry margin stocks regulation. that may be extended on securities as collateral by prescribing a maximum Regulation G and special margin requirements for bonds convertible loan value, which is a specified percentage of the market value of the into stocks were adopted by the Board of Governors effective Mar. 11, collateral at the time the credit is extended. Margin requirements are the 1968. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Policy Instruments All 1.17 FEDERAL RESERVE OPEN MARKET TRANSACTIONS Millions of dollars 1978 TTyyppee ooff ttrraannssaaccttiioonn 11997755 11997766 11997777 May June July Aug. Sept. Oct. Nov. U.S. GOVERNMENT SECURITIES Outright transactions (excluding matched salepurchase transactions) Treasury bills: 11111111,,,,555566662222 11114444,,,,333344443333 11113333,,,,777733338888 444411116666 4,395 770011 997722 2,635 11,,997788 2222,,,,000033339999 5555,,,,555599999999 8888,,,,444466662222 7777,,,,222244441111 777733337777 446666 668899 22,,114488 3333,,,,555588887777 22226666,,,,444433331111 2222 5555,,,,000011117777 2222,,,,111133336666 333300000000 666600003333 Others within 1 year:1 3333,,,,888888886666 444477772222 3333,,,,000011117777 55553333 113355 117711 116688 7733 111133339999 6 Exchange, or maturity shift ---444 792 444...444999999 -2,343 -380 -241 -1,544 563 -385 -778 333,,,555444999 222...555000000 1 to 5 years: 222 333,,,222888444 2222 3333,,,,222200002222 222,,,888333333 229900 663311 442244 335500 550077 662288 111177777777 10 Exchange, or maturity shift 33,,885544 ----2222,,,,555588888888 --66,,664499 --7799 446677 241 --449900 --556633 338855 --665577 5 to 10 years: 11,,551100 1111,,,,000044448888 775588 110011 117766 223388 111100 8877 116633 ---444,,,666999777 111,,,555777222 555888444 111,,,555222666 ---888777 111,,,444333444 888333555 Over 10 years: 14 Gross purchases.. 111,,,000777000 666444222 555555333 777444 111111555 111111333 112222 113399 111000888 1 Fyph/ifKyp or matiiritv cliift 888884444488888 222222222255555 11111,,,,,555556666655555 888899995555 666000000 666600000000 All maturities:1 17 Gross purchases 222222222211111,,,,,333331111133333 222221111199999,,,,,777770000077777 2222200000,,,,,888889999988888 999933335555 5,451 770011 111,,,999111999 3,386 22,,778855 3333,,,,000077775555 18 Gross sales • • • .... 55555,,,,,555559999999999 88888,,,,,666663333399999 77777,,,,,222224444411111 777733337777 446666 666888999 22,,114488 3333,,,,555588887777 19 Redemptions 2222299999,,,,,999998888800000 2222255555,,,,,000001111177777 44444,,,,,666663333366666 333300000000 666600003333 Matched sale-purchase transactions 20 Gross sales 111115555511111,,,,,222220000055555 111119999966666,,,,,000007777788888 444442222255555,,,,,222221111144444 44440000,,,,666633334444 5522,,554444 44,657 29,162 33,346 35,112 44440000,,,,777788885555 21 Gross purchases 111115555522222,,,,,111113333322222 111119999966666,,,,,555557777799999 444442222233333,,,,,888884444411111 44440000,,,,333366662222 5522,,555577 44,712 29,641 33,130 36,106 44440000,,,,555544446666 Repurchase agreements 22 Gross purchases 111114444400000,,,,,333331111111111 222223333322222,,,,,888889999911111 111117777788888.....666668888833333 11111111,,,,555511117777 1144,,995566 15,822 16,286 10,724 18,976 7777,,,,777711119999 23 Gross sales 111113333399999,,,,,555553333388888 222223333300000,,,,,333335555555555 111118888800000^^^^^555553333355555 11111111,,,,888811119999 1133,,110000 17,374 15,140 10,353 20,565 8888,,,,333388883333 24 Net change in U.S. Government securities ----666677774444 -1,261 2,854 3,540 43 ----2222,,,,000011117777 FEDERAL AGENCY OBLIGATIONS 77777,,,,,444443333344444 99999,,,,,000008888877777 55555,,,,,777779999988888 77,,332200 Outright transactions: 25 Gross purchases 26 Gross sales 117733 27 Redemptions 11111,,,,,666662211111446666666 888881199999661111199 11111,,,,,444442233333223333333 34 33200811 4 1133 28 12 39 Repurchase agreements: 28 Gross purchases 1155,,117755 1100,,552200 1133,,881111 3,927 3,421 5,170 33,,008800 3,877 6,675 2,544 29 Gross sales 1155,,556677 1100,,336600 1133,,663388 4,037 3,088 5,457 33,,003322 3,348 7,196 2,670 30 Net change in Federal agency obligations 997788 888822 11,,338833 -144 606 -291 --113388 501 r —533 -165 BANKERS ACCEPTANCES 31 Outright transactions net 116633 --554455 --119966 32 Repurchase agreements, net --3355 441100 115599 -17 747 -753 28 419 -479 -236 33 Net change in bankers acceptances 112277 --113355 --3377 -17 747 -753 28 419 -479 -236 34 Total net change in System Open Market Account 88,,553399 99,,883333 77,,114433 -834 8,783 -2,305 2,744 4,460 -969 -2,419 1 Both gross purchases and redemptions include special certificates amounting to $189 million. Acquisition of these notes is treated as a created when the Treasury borrows directly from the Federal Reserve, purchase; the run-off of bills, as a redemption. as follows (millions of dollars): 1975, 3,549; 1976, none; Sept. 1977, 2,500. NOTE.—Sales, redemptions, and negative figures reduce holdings of 2 In 1975, the System obtained $421 million of 2-year Treasury notes the System Open Market Account; all other figures increase such holdings. in exchange for maturing bills. In 1976 there was a similar transaction Details may not add to totals because of rounding. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A12 Domestic NonfinancialS tatistics • January 1979 1.18 FEDERAL RESERVE BANKS Condition and F.R. Note Statements Millions of dollars Wednesday End of month 1978 1978 Nov. 29 Dec. 6 Dec. 13 Dec. 20? Dec. 27» Oct. Nov. Consolidated condition statement ASSETS 1 Gold certificate account 11,642 11,640 11,635 11,611 11,671 11,655 11,642 2 Special Drawing Rights certificate account. 1,300 1,300 1,300 1,300 1,300 1,300 1,300 3 Coin 274 272 277 277 271 300 275 Loans: 4 5 O M t e h m er b er bank borrowings 1,270 586 472 502 3,111 1,207 813 Acceptances: 6 Bought outright 7 Held under repurchase agreements.. 370 444 236 Federal agency obligations: 8 Bought outright 7,899 7,899 7,896 7,896 7,896 7,938 7,899 9 Held under repurchase agreements.. 625 1,269 127 U.S. Government securities Bought outright: 10 Bills 44,790 37,041 43,238 39,784 42,263 48,376 45,985 11 Certificates—Special 12 Other 13 Notes 54,855 54,855 54,855 54,855 54,855 54,526 54,855 14 Bonds 12,465 12,465 12,465 12,465 12,465 11,757 12,465 15 Total i 112,110 104,361 110,558 107,104 109,583 114,659 113,305 16 Held under repurchase agreements. 2,000 2,056 663 17 Total U.S. Government securities. 114,110 104,361 110,558 107,104 111,639 115,322 113,305 18 Total loans and securities 124,274 112,846 118,926 115,502 124,359 124,830 122,017 19 Cash items in process of collection.... 12,738 15,357 14,203 17,975 15,820 13,366 13,165 20 Bank premises 396 398 398 397 398 395 396 Other assets: 21 Denominated in foreign currencies. 47 49 62 1,643 1,643 27 53 22 All other 1,962 2,017 2,041 2,302 2,580 2,334 1,901 23 Total assets. 152,633 143,879 148,842 151,007 158,042 154,207 150,749 LIABILITIES 24 Federal Reserve notes 101,070 101,462 102,202 102,781 103,892 98,154 100,825 Deposits: 25 Member bank reserves 32,402 28,648 33,116 30,788 37,254 26,260 31,919 26 U.S. Treasury—General account. 7,236 2,169 1,869 4,500 3,540 15,467 6,587 27 Foreign 275 367 204 275 285 305 379 28 Other 2 479 553 582 582 613 531 567 29 Total deposits. 40,392 31,737 35,771 36,145 41,692 42,563 39,452 30 Deferred availability cash items 6,587 6,884 6,584 7,582 7,754 8,930 5,927 31 Other liabilities and accrued dividends. 1,784 1,516 1,854 1,905 1,946 1,686 1,725 32 Total liabilities 149,833 141,599 146,411 148,413 155,284 151,333 147,929 CAPITAL ACCOUNTS 33 Capital paid in 1,073 1,075 1,076 1,076 1,078 1,069 1,073 34 Surplus 1,029 1,029 1,029 1,029 1,029 1,029 1,029 35 Other capital accounts 698 176 326 489 651 776 718 36 Total liabilities and capital accounts 143,879 148,842 151,007 158,042 154,207 150,749 152,633 37 MEMO: Marketable U.S. Govt, securities held in custody for foreign and intl. account 92,610 93,473 93,973 95,145 '90,073 92,412 91,855 Federal Reserve note statement 38 F.R. notes outstanding (issued to Bank) 111122,,442233 111122,,666611 111122,,994433 111133,,115544 111122,,994411 111100,,774411 111122,,444455 112,836 Collateral held against notes outstanding: 39 Gold certificate account 11,642 11,640 11,635 11,611 11,671 11,655 11,642 11,671 40 Special Drawing Rights certificate account.... 1,300 1,300 1,300 1,300 1,300 1,300 1,300 1,300 41 Eligible paper 1,170 534 418 445 1,848 1,094 692 907 42 U.S. Government securities 98,311 99,187 99,590 99,798 98,122 96,692 98,811 98,958 43 Total collateral 112,423 112,(§61 112,943 113,154 112,941 110,741 112,445 112,836 1 Includes securities loaned—fully guaranteed by U.S. Govt, securities 2 Includes certain deposits of domestic nonmember banks and foreignpledged with F.R. Banks—and excludes (if any) securities sold and owned banking institutions voluntarily held with member banks and scheduled to be bought back under matched sale-purchase transactions. redeposited in full with F.R. Banks. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Reserve Banks A13 1.19 FEDERAL RESERVE BANKS Maturity Distribution of Loan and Security Holdings Millions of dollars Wednesday End of month TTTyyypppeee aaannnddd mmmaaatttuuurrriiitttyyy 1978 1978 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 Oct. 31 Nov. 30 Dec. 31 1,260 588 473 502 3,111 1,206 812 1,172 2 Within 15 days 1,222 526 387 479 3,093 1,108 767 1,142 38 62 86 23 18 98 45 30 5 Acceptances 333777000 444444444 222333666 555888777 6 Within 15 days 333777000 444444444 222333666 555888777 7 16 days to 90 days 9 U.S. Government securities 111144,,111100 110044,,336611 110,558 110077,,110044 111111,,663399 111155,,332222 111133,,330055 111100,,556622 10 Within 15 days1 77,,335522 33,,774488 4,450 55,,664477 66,,991155 77,,119955 44,,446677 44,,229977 11 16 days to 90 days 1199,,777755 1155,,336699 19,654 1155,,005588 1188,,117799 2222,,007722 2200,,331155 1199,,880000 2299,,775588 2288,,224444 29,454 2299,,339999 2299,,554455 3300,,773300 3311,,552233 2299,,446655 3311,,883333 3311,,660088 31,608 3311,,660088 3311,,660088 3311,,663388 3311,,660088 3311,,660088 1144,,771177 1144,,771177 14,717 1144,,771177 1144,,771177 1133,,771199 1144,,771177 1144,,771177 1100,,667755 1100,,667755 10,675 1100,,667755 1100,,667755 99,,996688 1100,,667755 1100,,667755 88,,552244 77,,889999 7,896 77,,889966 99,,116655 88,,006655 77,,889999 88,,002299 17 Within 15 days1 776611 7733 8833 11,,335533 116644 113355 221177 18 16 days to 90 days 443377 449933 566 448822 448822 336699 443388 448822 19 91 days to 1 year 11,,229922 11,,229999 1,286 11,,228866 11,,228866 11,,448888 11,,229922 11,,228866 20 Over 1 year to 5 years 33,,668866 33,,668866 3,723 33,,772233 33,,772233 33,,666644 33,,668866 33,,772233 21 Over 5 years to 10 years 11,,448888 11,,448888 1,461 11,,446611 11,,446611 11,,552200 11,,448888 11,,551111 22 Over 10 years 886600 886600 860 886611 886600 886600 886600 881100 1 Holdings under repurchase agreements are classified as maturing within 15 days in accordance with maximum maturity of the agreements. 1.20 BANK DEBITS AND DEPOSIT TURNOVER Debits are shown in billions of dollars, turnover as ratio of debits to deposit. Monthly data are at annual rates. 1978 BBaannkk ggrroouupp,, oorr ttyyppee 11997755 11997766 11997777 ooff ccuussttoommeerr July Aug. Sept. Oct. Nov. Debits to demand deposits 2 (seasonally adjusted) 1111 AAAAllllllll ccccoooommmmmmmmeeeerrrrcccciiiiaaaallll bbbbaaaannnnkkkkssss 25,028.5 29,180.4 34,322.8 40,575.1 42.722.1 41.811.6 42,855.9 43,222.7 2222 MMMMaaaajjjjoooorrrr NNNNeeeewwww YYYYoooorrrrkkkk CCCCiiiittttyyyy bbbbaaaannnnkkkkssss.... .... 9,670.7 11,467.2 13,860.6 15,355.3 16,432.9 15,495.9 15,437.3 16,172.3 3333 OOOOtttthhhheeeerrrr bbbbaaaannnnkkkkssss 15,357.8 17,713.2 20,462.2 25,219.7 26.289.2 26.315.7 27,418.6 27,050.5 Debits to savings deposits 3 (not seasonally adjusted) 4444 AAAAllllllll ccccuuuussssttttoooommmmeeeerrrrssss 117744..00 443322..11 443333..00 442200..44 446611..44 444466..11 5555 BBBBuuuussssiiiinnnneeeessssssss 1111 2211..77 5555..66 5577..66 6600..99 6677..22 6655..55 6666 OOOOtttthhhheeeerrrrssss 115522..33 337766..55 337755..44 335599..55 339944..22 338800..77 Demand deposit turnover 2 (seasonally adjusted) 77777 AAAAAllllllllll cccccooooommmmmmmmmmeeeeerrrrrccccciiiiiaaaaalllll bbbbbaaaaannnnnkkkkksssss 105.3 116.8 129.2 139.0 146.2 141.6 144.1 146.3 88888 MMMMMaaaaajjjjjooooorrrrr NNNNNeeeeewwwww YYYYYooooorrrrrkkkkk CCCCCiiiiitttttyyyyy bbbbbaaaaannnnnkkkkksssss..... ..... 356.9 411.6 503.0 553.0 577.5 549.6 530.1 577.6 99999 OOOOOttttthhhhheeeeerrrrr bbbbbaaaaannnnnkkkkksssss 72.9 79.8 85.9 95.5 99.7 98.6 102.2 101.1 Savings deposit turnover 3 (not seasonally adjusted) 1111100000 AAAAAllllllllll cccccuuuuussssstttttooooommmmmeeeeerrrrrsssss 11..66 22..00 22..00 11..99 22..11 22..00 1111111111 BBBBBuuuuusssssiiiiinnnnneeeeessssssssss 11111 44..11 55..11 55..22 55..33 55..88 55..77 1111122222 OOOOOttttthhhhheeeeerrrrrsssss..... 11..55 11..88 11..88 11..77 11..99 11..88 1 Represents corporations and other profit-seeking organizations (ex- NOTE.—Historical data—estimated for the period 1970 through June cluding commercial banks but including savings and loan associations, 1977, partly on the basis of the debits series for 233 SMSA's, which were mutual savings banks, credit unions, the Export-Import Bank, and available through June 1977—are available from Publications Services, Federally sponsored lending agencies). Division of Administrative Services, Board of Governors of the Federal 2 Represents accounts of individuals, partnerships, and corporations, Reserve System, Washington, D.C. 20551. Debits and turnover data and of States and political subdivisions. for savings deposits are not available prior to July 1977. 3 Excludes negotiable orders of withdrawal (NOW) accounts and special club accounts, such as Christmas and vacation clubs. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A14 Domestic Nonfinancial Statistics • January 1979 1.21 MONEY STOCK MEASURES AND COMPONENTS Billions of dollars, averages of daily figures 1978 1974 1975 1976 1977 Dec. Dec. Dec. Dec. Item June July Aug. Sept. Oct. Nov. Seasonally adjusted MEASURES i 1 M-l 282.9 295.2 313.5 338.5 352.8 354.2 356.7 360.9 362.0 360.6 2 M-1 + 419.0 456.4 516.8 560.2 577.1 577.8 582.0 587.9 588.8 585.3 3 M-2 612.2 664.7 740.5 809.5 840.6 846.2 853.5 862.4 867.4 870.5 4 M-3 981.2 1,092.5 1,236.5 1,376.1 1,429.8 1,441.0 1,455.1 1,472.1 rl,483.9 1,492.1 5 M-4 701.2 746.1 803.2 883.5 927.3 933.6 939.8 950.5 955.6 966.0 6 M-5 1,070.3 1,173.8 1,299.2 1,450.1 1,516.5 1,528.4 1,541.4 1,560.2 rl,572.1 1,587.6 COMPONENTS 7 Currency 67.8 73.7 80.7 88.6 92.8 93.3 94.0 95.2 96.0 96.8 Commercial bank deposits: 8 Demand 215.1 221.5 232.8 249.9 259.9 260.9 262.8 265.7 266.1 263.9 9 Time and savings 418.3 450.9 489.7 545.0 574.5 579.4 583.0 589.7 593.6 605.3 10 Savings 135.8 160.5 201 .9 219.6 221.7 220.9 222.4 224.2 223.9 221.8 11 Negotiable CD's 2 89.0 81.3 62.7 74.0 86.7 87.4 86.3 88.1 88.2 95.4 12 Other time 193.5 209.1 225.1 251.5 266.1 271.1 274.3 211A 281.5 288.0 13 Nonbank thrift institutions3 369.1 427.8 496.0 566.6 589.2 594.7 601.6 609.6 '616.5 621.6 Not seasonally adjusted MEASURES i 14 M-l 291.3 303.9 322.6 348.2 351.7 356.0 354.2 358.8 361.3 362.9 15 M-l + 426.2 463.6 524.2 568.1 578.1 581.9 r579.2 '583.7 586.2 585.7 16 M-2 617.5 670.0 745.8 814.9 842.0 848.7 850.8 858.4 864.5 867.6 17 M-3 983.8 1,095.0 1,238.4 1,377.5 1,435.2 1,447.9 1,453.0 1,466.4 '1,478.5 1,484.3 18 M-4 708.0 753.5 810.0 890.9 928.3 936.0 938.8 948.7 955.3 964.0 19 M-5 1,074.3 1,178.4 1,320.7 1,453.4 1,521.5 1,535.3 1,541.0 1,556.7 '1,569.3 1,580.6 COMPONENTS 20 Currency 69.0 75.1 82.1 90.1 92.9 94.1 94.3 95.0 95.8 97.4 Commercial bank deposits: 21 Demand 222.2 228.8 240.5 258.1 258.8 262.0 259.9 263.8 265.6 265.5 22 Member 159.7 162.8 169.4 177.5 175.7 ill .1 176.1 178.2 179.2 178.2 23 Domestic nonmember 58.5 62.6 67.5 76.2 79.1 80.3 79.9 81.8 82.6 83.5 24 Time and savings 416.7 449.6 487.4 542.6 576.6 579.9 584.6 589.9 594.0 601.1 25 Savings 134.5 159.1 200.2 217.7 223.8 223.1 222.2 222.1 222.0 220.0 26 Negotiable CD's 2 90.5 83.5 64.3 75.9 86.3 87.3 88.0 90.3 90.8 96.4 27 Other time 191.7 207.1 222.9 249.0 266.5 269.5 274.4 277.5 281.2 284.8 28 Other checkable deposits4 0.4 0.7 1.4 2.1 2.6 2.7 2.8 '2.8 '2.8 2.8 29 Nonbank thrift institutions3 366.3 424.9 492.7 562.5 593.2 599.3 602.1 608.1 '614.0 661166..66 30 U.S. Government deposits (all commerical banks) 4.9 4.1 4.4 5.1 6.2 4.5 3.6 6.2 4.3 8.0 i Composition of the money stock measures is as follows: of mutual savings banks, savings and loan shares, and credit union shares (nonbank thrift). M-l: Averages of daily figures for (1) demand deposits at commercial M-4: M-2 plus large negotiable CD's. banks other than domestic interbank and U.S. Govt., less cash items in M-5: M-3 plus large negotiable CD's. process of collection and F.R. float; (2) foreign demand balances at F.R. Latest monthly and weekly figures are available from the Board's 508 Banks; and (3) currency outside the Treasury, F.R. Banks, and vaults (H.6) release. Back data are available from the Banking Section, Division of commercial banks. of Research and Statistics. M-l : M-l plus savings deposits at commercial banks, NOW accounts 2 Negotiable time CD's issued in denominations of $100,000 or more at banks and thrift institutions, credit union share draft accounts, and by large weekly reporting commercial banks. demand deposits at mutual savings banks. 3 Average of the beginning- and end-of-month figures for deposits of M-2: M-l plus savings deposits, time deposits open account, and time mutual savings banks, for savings capital at savings and loan associations, certificates of deposit (CD's) other than negotiable CD's of $100,000 or and for credit union shares. more at large weekly reporting banks. 4 Includes NOW accounts at thrift institutions, credit union share M-3: M-2 plus the average of the beginning- and end-of-month deposits draft accounts, and demand deposits at mutual savings banks. NOTES TO TABLE 1.23: 1 Adjusted to exclude domestic commercial interbank loans. of one large bank. Reductions in other items were: "Total loans," $1.0 2 Loans sold are those sold outright to a bank's own foreign branches, billion (of which $0.6 billion was in "Commercial and industrial loans"), nonconsolidated nonbank affiliates of the bank, the bank's holding and "Other securities," $0.5 billion. In late November "Commercial and company (if not a bank), and nonconsolidated nonbank subsidiaries of industrial loans" were increased by $0.1 billion as a result of loan rethe holding company. Prior to Aug. 28, 1974, the institutions included classifications at another large bank. had been defined somewhat differently, and the reporting panel of banks 4 Reclassification of loans reduced these loans by about $1.2 billion was also different. On the new basis, both "Total loans" and "Com- as of Mar. 31, 1976. merical and industrial loans" were reduced by about $100 million. 5 Reclassification of loans at one large bank reduced these loans by 3 Data beginning June 30, 1974, include one large mutual savings about $200 million as of Dec. 31, 1977. bank that merged with a nonmember commercial bank. As of that date there were increases of about $500 million in loans, $100 million in NOTE.—Data are for last Wednesday of month except for June 30 "Other" securities and $600 million in "Total loans and investments." and Dec. 31; data are partly or wholly estimated except when June 30 As of Oct. 31, 1974, "Total loans and investments" of all commercial and Dec. 31 are call dates. banks were reduced by $1.5 billion in connection with the liquidation Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Monetary Aggregates A15 1.22 AGGREGATE RESERVES AND DEPOSITS Member Banks Billions of dollars, averages of daily figures 1977 1978 IItteemm 11997744 11997755 11997766 DDeecc.. DDeecc.. DDeecc.. Dec. Apr. May June July Aug. Sept. Oct. Nov. Seasonally adjusted 11 RReesseerrvveess11 36.57 34.68 34.93 36.14 36.95 37.26 37.73 38.19 37.91 38.17 r38.43 39.73 22 NNoonnbboorrrroowweedd 35.84 34.55 34.89 35.57 36.39 36.05 36.63 36.88 36.77 37. 11 r37.15 39.03 33 RReeqquuiirreedd 36.31 34.42 34.29 35.95 36.80 37.04 37.55 38.00 37.74 37.97 38.26 39.51 44 DDeeppoossiittss ssuubbjjeecctt ttoo rreesseerrvvee rreeqquuiirreemmeennttss22.. .. 486.1 504.6 528.9 569.1 586.0 592.0 595.6 600.3 601.1 606.4 608.1 677.1 55 TTiimmee aanndd ssaavviinnggss 322.1 337.1 354.3 387.0 400.7 406.0 407.1 410.5 411.4 416.0 417.5 427.9 DDeemmaanndd:: 66 PPrriivvaattee 160.6 164.5 171.4 178.5 182.0 183.5 184.6 186.1 186.5 186.3 187.2 186.9 77 UU..SS.. GGoovveerrnnmmeenntt.. 3.3 2.9 3.2 3.6 3.3 2.6 3.9 3.7 3.3 4.1 3.5 2.3 Not seasonally adjusted 8 Deposits subject to reserve requirements2.. 491.8 510.9 534.8 575.3 588.6 588.3 596.8 600.6 599.2 605.9 608.4 614.9 9 Time and savings . 321.7 337.2 353.6 386.4 401.2 406.1 408.6 411.1 412.8 416.6 418.5 425.2 Demand: 10 Private 166.6 170.7 177.9 185.1 183.8 179.3 183.7 186.4 183.9 184.7 186.9 187.7 11 U.S. Government 3.4 3.1 3.3 3.8 3.6 2.9 4.5 3.2 2.5 4.6 3.0 2.0 1 Series reflects actual reserve requirement percentages with no adjust- 2 Includes total time and savings deposits and net demand deposits as ment to eliminate the effect of changes in Regulations D and M. There defined by Regulation D. Private demand deposits include all demand are breaks in series because of changes in reserve requirements effective deposits except those due to the U.S. Govt., less cash items in process of Dec. 12, 1974; Feb. 13, May 22, and Oct. 30,1975; Jan. 8, and Dec. 30,1976. collection and demand balances due from domestic commercial banks. In addition, effective Jan. 1, 1976, statewide branching in New York was instituted. The subsequent merger of a number of banks raised NOTE.—Back data and estimates of the impact on required reserves required reserves because of higher reserve requirements on aggregate and changes in reserve requirements are shown in Table 14 of the Board's deposits at these banks. Annual Statistical Digest, 1971-1975. 1.23 LOANS AND INVESTMENTS All Commercial Banks Billions of dollars; last Wednesday of month except for June 30 and Dec. 31 1978 11997744 11997755 11997766 11997777 CCCaaattteeegggooorrryyy DDeecc.. 331133 DDeecc.. 3311 DDeecc.. 3311 DDeecc.. 3311 July 26p Aug. 30*> Sept. 21* Oct. 25*> Nov. 29p Dec. 31*> Seasonally adjusted j Loans and investments1 691.1 721.8 785.1 870.6 940.7 944.6 952.4 960.9 966.5 967.3 2 Including loans sold outright2.... 695.9 726.2 788.9 875.5 945.3 949.3 957.0 964.8 970.2 971.1 Loans: 3 Total 500.2 496.9 538.9 617.0 675.1 680.2 687.3 696.8 706.8 709.0 4 Including loans sold outright2... 505.0 501.3 542.7 621.9 679.7 684.9 691.9 700.7 710.5 712.8 5 Commercial and industrial 183.5 176.2 4179.7 5201.4 220.8 222.8 224.6 227.0 228.9 228.9 6 Including loans sold outright2... 186.2 178.7 4182.1 5204.2 223.1 225.2 226.9 228.9 230.8 230.7 Investments: 7 U.S. Treasury 51.1 80.1 98.0 95.6 100.6 97.9 97.2 95.2 90.3 88.4 8 Other 139.8 144.8 148.2 158.0 165.0 166.5 167.9 168.9 169.4 169.9 Not seasonally adjusted 9 Loans and investments1 705.6 737.0 801.6 888.9 936.6 942.0 951.4 958.4 969.3 987.6 10 Including loans sold outright2 710.4 741.4 805.4 893.8 941.2 946.7 956.1 962.3 973.0 991.4 Loans: 11 Total1 510.7 507.4 550.2 629.9 675.6 681.0 688.6 696.6 707.2 723.9 12 Including loans sold outright2... 515.5 511.8 554.0 634.8 680.2 685.7 693.3 700.5 710.9 727.7 13 Commercial and industrial 186.8 179.3 4182.9 5205.0 220.9 221.7 223.9 226.5 228.9 233.0 14 Including loans sold outright2... 189.5 181.8 4185.3 5207.8 232.2 224.1 226.2 228.4 230.8 234.8 Investments: 15 U.S. Treasury 54.5 84.1 102.5 100.2 96.1 94.8 95.0 93.5 92.6 93.0 16 Other 140.5 145.5 148.9 158.8 164.9 166.2 167.7 168.3 169.5 170.7 For notes see bottom of opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A16 Domestic Nonfinancial Statistics • January 1979 1.24 COMMERCIAL BANK ASSETS AND LIABILITIES Last-Wednesday-of-Month Series Billions of dollars except for number of banks 1977 1978 3 Account Dec. Mar. Apr. May June July? Aug.? Sept.2* Oct.p Nov.* Dec.* All commercial 1 Loans and investments 939.1 939.7 953.0 974.4 985.0 980.6 985.5 996.4 1,003.0 1,016.2 1,034.7 2 Loans, gross 680.1 680.4 688.7 712.4 722.1 719.6 724.5 733.6 741.2 754.1 770.9 Investments: 3 U.S. Treasury securities... 100.2 99.0 100.2 97.3 97.9 96.1 94.8 95.0 93.5 92.6 92.6 4 Other 158.8 160.3 164.1 164.6 165.1 164.9 166.2 167.7 168.3 169.5 171.2 5 Cash assets 168.7 130.5 133.1 161.0 166.8 130.2 137.4 141.8 146.5 149.2 170.1 6 Currency and coin 13.9 14.4 14.3 14.5 12.0 14.8 15.2 15.2 15.1 16.7 17.2 7 Reserves with F.R. Banks... 29.3 30.2 27.6 30.3 29.6 23.6 29.7 32.6 34.6 32.6 37.7 8 Balances with banks 59.0 42.6 43.6 51.9 56.0 44.4 43.0 44.4 45.0 46.5 51.6 9 Cash items in process of collection.. 66.4 43.3 47.6 64.3 69.3 47.3 49.5 49.6 51.7 53.5 63.6 10 Total assets/total liabilities and capital1 1,166.0 1,140.5 1,156.9 1,206.5 1,215.0 1,179.2 1,192.9 1,209.5 1,220.4 1,240.8 1,284.0 11 939.4 899.8 915.5 952.9 965.7 932.3 937.7 949.9 952.3 959.0 993.1 Demand: 12 Interbank 51.7 37.6 39.0 51.2 49.3 40.5 40.4 41.9 43.3 42.9 51.1 13 U.S. Government 7.3 4.9 6.2 3.3 8.0 4.3 2.8 11.0 7.6 2.1 2.3 14 Other 323.9 281.2 293.8 312.9 317.5 296.3 298.6 297.1 299.2 304.7 327.1 Time: 15 Interbank 9.8 9.0 9.0 9.4 10.2 10.3 10.7 11.6 11.1 11.8 12.4 16 Other 546.6 567.1 567.5 576.1 580.8 580.9 585.2 588.3 591.2 597.6 600.3 17 Borrowings 96.2 105.6 104.9 112.2 106.8 103.2 109.1 112.8 118.3 125.6 133.0 18 Total capital accounts2 85.8 83.4 83.7 84.6 89.9 85.8 86.2 87.1 87.1 87.8 87.3 19 MEMO: Number of banks 14,707 14,689 14,697 14,702 14,698 14,713 14,721 14,715 14,713 14,719 14,719 Member 20 675.5 668.6 676.8 693.8 699.7 695.8 698.9 706.9 713.4 724.3 739.5 21 Loans, gross 494.9 490.5 495.3 514.3 519.6 517.6 520.3 527.0 533.9 544.6 558.3 Investments: 22 U.S. Treasury securities. .. 70.4 68.2 68.8 66.9 67.4 65.7 65.3 65.4 64.1 63.5 63.6 23 Other 110.1 109.9 112.7 112.7 112.7 112.5 113.3 114.5 115.3 116.2 117.6 24 Cash assets, total 134.4 104.8 106.5 130.7 133.8 104.2 111.2 115.4 118.6 121.3 140.2 25 Currency and coin 10.4 10.6 10.5 10.6 8.7 10.8 11.1 11.1 11.1 12.3 12.7 26 Reserves with F.R. Banks... 29.3 30.2 27,6 30.3 29.6 23.6 29.7 32.6 34.6 32.6 37.7 27 Balances with banks 30.8 22.9 22.7 28.1 29.1 24.3 22.9 24.0 23.2 25.1 28.6 28 Cash items in process of collection.. 63.9 41.2 45.7 61.7 66.5 45.4 47.6 47.7 49.7 51.4 61.2 29 Total assets/total liabilities and capital1 861.8 833.2 843.3 884.7 888.7 857.3 868.5 882.2 891.2 908.5 945.2 30 Deposits 683.5 645.1 655.1 686.7 694.3 666.1 670.6 679.6 682.5 688.6 716.3 Demand: 31 48.0 34.7 36.0 47.5 45.5 37.3 37.2 38.6 39.9 39.5 47.3 32 U.S. Government 5.4 3.7 4.5 2.2 5.6 3.1 1.9 8.1 5.7 1.5 1.6 33 Other 239.4 205.1 213.4 229.1 231.6 214.6 217.0 215.6 217.0 221.3 237.9 Time: 34 Interbank 7.8 7.0 6.9 7.3 8.1 8.2 8.6 9.4 9.0 9.7 10.2 35 Other 382.9 394.7 394.3 400.5 403.4 402.9 405.9 407.8 411.0 416.7 419.3 36 Borrowings 84.9 91.8 91.1 96.9 92.1 88.0 93.9 97.2 101.4 108.1 115.9 37 Total capital accounts2 63.7 62.4 62.7 63.3 66.1 64.2 64.5 65.1 65.2 65.7 65.5 38 MEMO: Number of banks. 5,669 5,654 5,645 5,638 5,622 5,613 5,610 5,593 5,585 5,586 5,586 1 Includes items not shown separately. NOTE.—Figures include all bank-premises subsidiaries and other sig- Effective Mar. 31, 1976, some of the item "reserve for loan losses" nificant majority-owned domestic subsidiaries. and all of the item "unearned income on loans" are no longer reported Commercial banks: All such banks in the United States, including as liabilities. As of that date the "valuation" portion of "reserve for member and nonmember banks, stock savings banks, nondeposit trust loan losses" and the "unearned income on loans" have been netted companies, and U.S. branches of foreign banks. against "other assets," and against "total assets" as well. Member banks: The following numbers of noninsured trust companies Total liabilities continue to include the deferred income tax portion of that are members of the Federal Reserve System are excluded from mem- "reserve for loan losses." ber banks in Tables 1.24 and 1.25 and are included with noninsured banks 2 Effective Mar. 31, 1976, includes "reserves for securities" and the in Table 1.25: 1976—December, 11; 1978—January, 12. contingency portion (which is small) of "reserve for loan losses." 3 Figures partly estimated except on call dates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A17 1.25 COMMERCIAL BANK ASSETS AND LIABILITIES Call-Date Series Millions of dollars, except for number of banks 1976 1977 1978 1976 1977 1978 Account Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Dec. 31 June 30 Total insured National (all insured) 1 882277,,669966 854,733 914,779 956,431 476,610 488,240 523,000 542,218 Loans: 2 578,734 601,122 657,509 695,443 340,691 351,311 384,722 403,812 3 Net 556600,,007777 581,143 636,318 672,207 329,971 339,955 372,702 390,630 Investments: 4 U.S. Treasury securities 101,461 100,568 99,333 97,001 55,727 53,345 52,244 50,519 5 147,500 153,042 157,936 163,986 80,191 83,583 86,033 87,886 6 129,562 130,726 159,264 157,393 76,072 74,641 92,050 90,728 7 1,003,970 1,040,945 1,129,712 1,172,772 583,304 599,743 651,360 671,166 8 882255,,000033 884477,,337722 922,657 945,874 469,377 476,381 520,167 526,932 Demand: 9 3,022 2,817 7,310 7,956 1,676 1,632 4,172 4,483 10 44,064 44,965 49,843 47,203 23,149 22,876 25,646 22,416 11 285,200 284,544 319,873 312,707 163,346 161,358 181,821 176,025 Time: 12 8,248 7,721 8,731 8,987 4,907 4,599 5,730 5,791 13 484,467 507,324 536,899 569,020 276,296 285,915 302,795 318,215 14 75,291 81,137 89,339 98,351 54,421 57,283 63,218 68,948 15 72,061 75,502 79,082 83,074 41,319 43,142 44,994 47,019 16 14,397 14,425 14,397 14,381 4,735 4,701 4,654 4,616 State member (all insured) Insured nonmember 17 114444,,000000 114444,,559977 152,514 157,464 207,085 221,896 239,265 256,749 Loans: 18 102,277 102,117 110,243 115,736 135,766 147,694 162,543 175,894 19 Net 9999,,447744 9999,,117733 110077,,220055 112,470 130,630 142,015 156,411 169,106 Investments: 20 U.S. Treasury securities 18,849 19,296 18,179 16,886 26,884 27,926 28,909 29,595 21 22,874 23,183 24,091 24,841 44,434 46,275 47,812 51,259 22 32,859 35,918 42,305 43,057 20,631 20,166 24,908 23,606 23 189,579 195,452 210,442 217,384 231,086 245,748 267,910 284,221 24 114499,,449911 115522,,447722 163,436 167,403 220066,,113344 218,519 239,053 251,539 Demand: 25 429 371 1,241 1,158 917 813 1,896 2,315 26 19,295 20,568 22,346 23,117 1,619 1,520 1,849 1,669 27 52,204 52,570 57,605 55,550 69,648 70,615 80,445 81,131 Time: 28 2,384 2,134 2,026 2,275 956 988 973 920 29 Other 75,178 76,827 80,216 85,301 132,993 144,581 153,887 165,502 30 17,310 19,697 21,736 23,167 3,559 4,155 4,384 6,235 31 13,199 13,441 14,182 14,670 17,542 18,919 19,905 21,384 32 1,023 1,019 1,014 1,005 8,639 8,705 8,729 8,760 Noninsured nonmember Total nonmember 33 18,819 22,940 24,415 28,699 225,904 244,837 263,681 285,448 Loans: 34 16,336 20,865 22,686 26,747 152,103 168,559 185,230 202,641 35 Net 16,209 20,679 22,484 26,548 146,840 162,694 178,896 195,655 Investments: 36 U.S. Treasury securities 1,054 993 879 869 27,938 28,919 29,788 30,465 37 1,428 1,081 849 1,082 45,863 47,357 48,662 52,341 38 6,496 8,330 9,458 9,360 27,127 28,497 34,367 32,967 39 26,790 33,390 36,433 42,279 257,877 279,139 304,343 326,501 40 1133,,332255 14,658 16,844 19,924 219,460 233,177 255,898 271,463 Demand: 41 4 8 10 8 921 822 1,907 2,323 42 1,277 1,504 1,868 2,067 2,896 3,025 3,718 3,736 43 Other 3,236 3,588 4,073 4,814 72,884 74,203 84,518 85,946 Time: 44 1,041 1,164 1,089 1,203 1,997 2,152 2,063 2,123 45 7,766 8,392 9,802 11,831 140,760 152,974 163,690 177,334 46 4,842 7,056 6,908 8,413 8,401 11,212 11,293 14,649 47 818 893 917 962 18,360 19,812 20,823 22,346 48 MEMO: Number of banks 275 293 310 317 8,914 8,998 9,039 9,077 1 Includes items not shown separately. For Note see Table 1.24. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A18 Domestic Nonfinancial Statistics • January 1979 1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Detailed Balance Sheet, June 30, 1978 Millions of dollars, except for number of banks. Member banks1 All Insured Asset account commercial commercial Large banks banks banks Total All other New York City of Other City Chicago large2 1 Cash bank balances, items in process 166,754 157,393 133,786 40,354 5,594 48,783 39,054 2 Currency and coin 11,950 11,883 8,691 795 190 2,878 4,828 3 Reserves with Federal Reserve Banks 29,574 29,566 29,566 4,104 1,537 12,499 11,426 4 Demand balances with banks in United States 43,092 38,158 23,166 10,382 248 3,539 8,996 5 Other balances with banks in United States... 6,779 5,007 2,775 520 5 782 1,468 6 Balances with banks in foreign countries 6,093 3,588 3,110 439 384 1,484 803 7 Cash items in process of collection 69,266 69,192 66,478 24,113 3,231 27,602 11,533 8 Total securities held—Book value 261,272 259,360 178,753 20,609 7,979 57,297 92,868 9 U.S. Treasury 97,872 97,002 67,406 9,623 2,955 22,215 32,613 10 Other U.S. government agencies 39,847 39,486 25,193 1,800 1,353 7,362 14,678 11 States and political subdivisions 117,257 117,018 82,541 8,881 3,480 26,626 43,554 12 All other securities 6,204 5,767 3,549 305 191 1,071 1,981 13 Unclassified total 92 64 23 41 14 Trading-account securities 7,160 7,156 7,010 3,026 978 2,756 251 15 U.S. Treasury 4,062 4,062 4,044 1,907 713 1,352 72 16 Other U.S. government agencies 986 986 976 428 80 423 45 17 States and political subdivisions 1,676 1,676 1,657 610 133 824 90 18 All other trading account securities 345 345 270 82 52 133 3 19 Unclassified 92 64 23 41 20 Bank investment portfolios 254,112 252,204 171,743 17,583 7,002 54,541 92,617 21 U.S. Treasury 93,810 92,940 63,362 7,716 2,242 20,863 32,541 22 Other U.S. government agencies 38,861 38,499 24,217 1,373 1,273 6,939 14,633 23 States and political subdivisions 115,582 115,343 80,884 8,271 3,347 25,802 43,464 24 All other portfolio securities 5,859 5,422 3,279 223 139 938 1,979 25 Federal Reserve stock and corporate stock 1,669 1,628 1,380 309 105 491 475 26 Federal funds sold and securities resale agreement. 48,576 43,768 34,495 4,309 1,616 17,935 10,636 27 Commercial banks 41,068 36,621 27,517 2,321 1,300 13,996 9,899 28 Brokers and dealers 4,962 4,954 4,847 1,514 235 2,528 569 29 Others 2,546 2,193 2,131 474 80 1,411 167 30 Other loans, gross 673,615 651,675 485,054 76,423 25,479 184,099 199,053 31 LESS: Unearned income on loans 16,142 16,086 10,768 620 104 3,521 6,524 32 Reserves for loan loss 7,293 7,150 5,680 1,297 325 2,155 1,902 33 Other loans, net 650,180 628,439 468,606 74,506 25 049 178,424 190,628 Other loans, gross, by category 34 Real estate loans 192,877 192,609 131,891 9,629 2,678 49,324 70,260 35 Construction and land development 23,658 23,639 17,684 2,391 630 8,586 6,076 36 Secured by farmland 8,208 8,189 3,565 23 8 405 3,129 37 Secured by residential properties 110,293 110,113 76,832 4,891 1,426 28.984 41,531 38 1- to 4-family residences 104,952 104,793 72,964 4,209 1,331 27,608 39,816 39 FHA-insured or VA-guaranteed 7,496 7,423 6,430 519 42 3,395 2,474 40 Conventional 97,457 97,370 66,534 3,690 1,289 24,213 37,342 41 Multifamily residences. 5,341 5,320 3,869 683 95 1,376 1,714 42 FHA-insured 399 395 327 120 25 87 96 43 Conventional 4,941 4,926 3,541 563 70 1,289 1,619 44 Secured by other properties 50,719 50,667 33,810 2,324 614 11,349 19,523 45 Loans to financial institutions 44,426 35,472 33,355 11,483 4,015 14.985 2,873 46 REITs and mortgage companies 8,348 8,341 7,949 2,114 812 4,369 654 47 Domestic commercial banks 5,263 3,116 2,398 702 123 1,307 265 48 Banks in foreign countries 12,864 6,610 6,447 2,931 272 2,648 596 49 Other depository institutions 1,480 1,458 1,312 240 53 775 245 50 Other financial institutions 16,471 15,948 15,249 5,496 2,755 5,886 1.113 51 Loans to security brokers and dealers 11,716 11,340 11,043 6,567 1,457 2,706 313 52 Other loans to purchase or carry securities 4,425 4,337 3,604 403 294 1,896 1,011 53 Loans to farmers—except real estate 27,018 26,993 14,813 161 178 3,630 10,844 54 Commercial and industrial loans 221,591 210,907 170,678 38,588 13,149 67,555 51,387 55 Loans to individuals 153,582 153,458 105,611 6,686 334 37,998 58,592 56 Instalment loans 124,139 124,066 85.515 5,041 505 31,323 47,646 57 Passenger automobiles 55,757 55,740 35,523 994 179 10,746 23,605 58 Residential repair and modernization 7,956 7,955 5,203 305 77 1,912 2,909 59 Credit cards and related plans 20,136 20,125 17,766 2,214 068 9,069 5,414 60 Charge-account credit cards 16,185 16,184 14.516 1,424 027 7,617 4,449 61 Check and revolving credit plans 3,951 3,941 3,249 791 41 1,453 965 62 Other retail consumer goods 18,752 18,747 12,722 395 54 4,843 7,430 63 Mobile homes 9,387 9,387 6,553 171 19 2,471 3,892 64 Other 9,365 9,360 6,169 225 35 2,372 3,537 65 Other instalment loans 21,539 21,498 14,301 1,132 128 4,752 8,288 66 Single-payment loans to individuals 29,443 29,392 20,096 1,646 829 6,675 10,946 67 All other loans 17,979 16,559 14,059 2,906 373 6,005 3,774 68 Total loans and securities, net 961,697 933,196 683,234 99,mi 34,749 254,146 294,607 69 Direct lease financing 6,303 6,302 5,918 1,106 98 3,669 1,045 70 Fixed assets—Buildings, furniture, real estate... 22,318 22,191 16,454 2,390 793 6,215 7,056 71 Investment in unconsolidated subsidiaries 3,146 3,109 3,069 1.546 182 1,240 101 72 Customer acceptances outstanding 16,489 15,293 14,788 7,399 1,089 5,908 392 73 Other assets 38,347 35,288 31,300 12,779 1,241 12,456 4,824 74 Total assets ,215,052 1,172,773 888,551 165,307 43,748 332,417 347,080 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks A19 1.26 Continued M ember bank si All Insured Non- Liability or capital account commercial commercial Large banks member banks banks banks1 Total All other New York City of Other City Chicago large2 75 Demand deposits 374,758 367,867 282,751 65,198 10,932 100,994 105,627 92,006 76 Mutual savings banks 1,626 1,425 1,217 588 1 291 337 409 77 Other individuals, partnerships, and corpora- 279,829 278,459 206,399 33,292 7,802 78,702 86,603 73,430 78 U.S. government 7,964 7,956 5,641 584 187 2,043 2,828 2,323 79 States and political subdivisions 18,210 18,138 12,421 830 184 3,564 7,842 5,789 80 Foreign governments, central banks, etc...... 1,840 1,351 1,317 1,084 25 170 37 524 81 Commercial banks in United States 38,924 37,963 36,639 18,730 2,147 11,503 4,260 2,285 82 Banks in foreign countries 8,721 7,815 7,679 6,007 225 1,249 198 1,042 83 Certified and officers' checks, etc 17,643 14,760 11,440 4,083 361 3,473 3,522 6,204 84 Time deposits 365,015 353,571 257,007 37,850 15,695 93,735 109,727 108,008 90 90 72 1 71 18 86 Mutual savings banks 292 275 263 115 37 90 20 29 87 Other individuals, partnerships, and corpora- 287,380 280,154 220022,,880088 29,149 1122,,111188 72,205 89,336 84,572 88 U.S. government 989 989 793 82 39 421 251 195 89 States and political subdivisions 56,273 55,928 38,077 1,672 1,261 16,031 19,113 18,195 90 Foreign governments, central banks, etc 10,171 7,429 7,193 4,184 1,201 1,684 123 2,979 91 Commercial banks in United States 7,968 7,352 6,645 1,917 911 3,113 705 1,323 92 Banks in foreign countries 1,853 1,354 1,156 730 128 190 108 697 93 Savings deposits 226,026 224,436 154,577 10,945 2,758 55,474 85,401 71,449 94 Individuals and nonprofit organizations 210,453 209,067 144,198 10,150 2,612 51,865 79,572 66,255 95 Corporations and other profit organizations.. 10,807 10,787 7,431 504 137 3,091 3,699 3,376 62 62 53 16 36 9 97 States and political subdivisions 4,501 4,486 2,863 273 9 494 2,087 1,638 98 All other 204 35 31 16 * 9 7 172 99 Total deposits 965,799 945,875 694,335 113,992 29,385 250,204 300,755 271,464 100 Federal funds purchased and securities sold under agreements to repurchase 93,179 88,903 83,003 20,103 8,989 40,575 13,336 10,176 101 Commercial banks 46,947 43,727 41,154 7,773 5,904 21,697 5,780 5,793 102 Brokers and dealers 13.356 13,289 12,325 3,199 1,897 5,686 1,543 1,030 103 Others 32,876 31,887 29,524 9,132 1,188 13,192 6,013 3,352 104 Other liabilities for borrowed money 13,586 9,448 9,112 3,398 179 4,243 1,292 4,473 105 Mortgage indebtedness 1,738 1,733 1,425 233 28 698 465 313 106 Bank acceptances outstanding 17,125 15,925 15,419 8,014 1,095 5,916 394 1,705 107 Other liabilities 33,773 22,062 19,126 5,911 1,106 8,051 4,057 14,647 108 Total liabilities 1,125,200 1,083,946 822,421 151,651 40,782 309,688 320,299 302,779 109 Subordinated notes and debentures 5,816 5,753 4,440 1,004 80 2,061 1,296 1,376 110 Equity capital 84,037 83,074 61,690 12,652 2,885 20,668 25,485 22,347 Ill Preferred stock 88 81 33 2 31 55 112 Common stock 17,790 17,691 12,743 2,645 570 3,997 5,531 5,047 113 Surplus 32,386 31,874 22,906 4,451 1,404 8,063 8,898 9,480 114 Undivided profits 31,949 31,684 24,803 5,334 859 8,238 10,372 7,146 115 Other capital reserves 1,824 1,744 1,205 132 52 368 652 619 116 Total liabilities and equity capital 1,215,052 1,172,773 888,551 165,307 43,748 332,417 347,080 326,501 MEMO ITEMS: 117 Demand deposits adjusted2 258,603 252,756 173,993 21,771 5,368 59,847 87,007 84,610 Average for last 15 or 30 days: 118 Cash and due from bank 151,066 142,173 121,518 35,452 5,619 44,611 35,836 29,548 119 Federal funds sold and securities purchased under agreements to resell 53,196 47,463 36,121 5,530 1,901 16,558 12,132 17,075 120 Total loans 647,386 628,167 468,342 74,085 24,972 178,557 190,728 179,043 121 Time deposits of $ 100,000 or more 181,510 174,479 143,050 31,979 12,833 61,496 36,742 38,459 122 Total deposits 941,481 923,749 675,725 106,594 28,441 243,663 297,026 265,756 123 Federal funds purchased and securities sold under agreements to repurchase 9955,,227733 90,853 85,358 2211,,885599 9,825 40,469 1133,,220055 9,915 124 Other liabilities for borrowed money 13,002 8,533 8,027 3,433 171 3,437 986 4,975 125 Standby letters of credit outstanding 18,948 17,750 16,686 9,406 1,269 4,796 1,215 2,262 126 Time deposits of $100,000 or more 183,339 177,602 145,695 32,476 13,253 62,711 37,245 37,653 127 Certificates of deposit 155,925 151,931 123,685 28,200 11,450 52,439 31,595 32,240 128 Other time deposits 27,414 25,671 22,001 4,277 1,803 10,271 5,650 5,413 129 Number of banks 14,698 14,381 5,621 12 9 153 5,447 9,077 1 Member banks exclude and nonmember banks include 13 noninsured NOTE.—Data include consolidated reports, including figures for all trust companies that are members of the Federal Reserve System. bank-premises subsidiaries and other significant majority-owned do- 2 Demand deposits adjusted are demand deposits other than domestic mestic subsidiaries. Securities are reported on a gross basis before deduccommercial interbank and U.S. government, less cash items reported tions of valuation reserves. Back data in lesser detail were shown in as in process of collection. previous BULLETINS. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A20 Domestic Nonfinancial Statistics • January 1979 1.27 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS Assets and Liabilities Millions of dollars, Wednesday figures 1978 Account Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Dec. 6p Dec. 13p Dec. 20p Dec. TIP 1 Total loans and investments 486,481 494,814 492,405 490,818 490,351 493,087 492,231 502,173 503,617 Loans: 2 Federal funds sold1 24,647 31,524 26,884 26,524 26,769 28,511 26,147 31,310 31,095 3 To commercial banks 18,200 24,306 20,013 19,912 20,867 19,547 19,008 23,512 24,926 To brokers and dealers involving— 4 U.S. Treasury securities 2,894 4,219 3,824 3,609 3,159 5,677 4,015 4,819 3,049 5 Other securities 748 722 778 851 784 860 800 959 1,092 6 To others 2,805 2,277 2,269 2,152 1,959 2,427 2,324 2,020 2,028 7 Other, gross 361,633 363,030 363,934 363,449 363,297 364,408 364,846 369,513 370,991 8 Commercial and industrial 139,951 140,390 140,813 140,612 140,658 140,655 140,557 141,829 142,103 9 Agricultural 5,371 5,338 5,368 5,320 5,295 5,255 5,248 5,276 5,352 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities 1,133 1,641 1,716 1,292 850 1,654 1,571 1,339 772 11 Other securities 9,160 8,358 8,100 7,521 7,377 7,090 6,982 8,117 7,791 To others: 12 U.S. Treasury securities 109 111 109 111 111 104 112 123 129 13 Other securities 2,570 2,590 2,596 2,582 2,559 2,568 2,583 2,593 2,594 To nonbank financial institutions: 14 Personal and sales finance cos., etc 8,872 8,752 8,780 8,447 8,499 8,600 8,502 8,976 9,192 15 Other 15,820 15,888 15,748 15,601 15,620 15,642 15,807 15,815 15,857 16 Real estate 87,716 87,926 88,454 88,825 89,013 89,247 89,630 89,904 90,212 To commercial banks: 17 Domestic 2,674 3,115 2,796 2,908 3,112 2,947 2,768 3,149 3,415 18 Foreign 7,860 8,554 8,352 8,498 8,434 8,554 8,757 9,161 9,684 19 Consumer instalment 55,211 55,311 55,731 55,958 56,287 56,455 56,776 57,314 57,760 20 Foreign govts., official institutions, etc 1,969 2,059 2,117 2,118 2,177 2,047 2,168 2,081 2,151 21 All other loans 23,217 22,997 23,254 23,656 23,305 23,590 23,385 23,836 23,979 22 LESS: Loan loss reserve and unearned income on loans 11,002 11,075 11,134 11,207 11,213 11,238 11,287 11,314 11,251 23 Other loans, net. . 350,631 351,955 352,800 352,242 352,084 353,170 353,559 358,199 359,740 Investments: 24 U.S. Treasury securities.. 41,483 41,333 42,421 41,637 41,317 41,075 41,324 41,383 41,511 25 Bills 3,328 3,252 3,072 3,215 3,136 3,055 3,431 3,665 3,880 Notes and bonds, by maturity: 26 Within 1 year 7,179 7,348 7,314 7,472 7,585 7,775 7,793 7,921 7,979 27 1 to 5 years 25,497 25,272 25,859 24,979 24,704 24,417 24,340 24,056 23,939 28 After 5 years 5,479 5,461 6,176 5,971 5,892 5,828 5,760 5,741 5,713 29 Other securities 69,720 70,002 70,300 70,415 70,181 70,331 71,201 71,281 71,271 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills 6,523 6,480 6,599 6,411 6,277 6,166 6,454 6,128 6,022 31 Allother 45,697 46,042 46,245 46,350 46,342 46,246 46,454 46,554 46,573 Other bonds, corporate stocks, and securities: 32 Certificates of participation2 2,897 2,882 2,925 2,876 2,942 2,953 3,031 3,029 3,095 33 All other, including corporate stocks... 14,603 14,598 14,531 14,778 14,620 14,966 15,262 15,570 15,581 34 Cash items in process of collection 50,704 49,019 51,484 49,442 46,720 47,571 48,515 52,071 55,835 35 Reserves with Federal Reserve Banks 22,677 20,512 21,370 23,536 24,876 21,711 26,007 23,764 30,276 36 Currency and coin 6,554 6,485 6,814 6,549 7,754 6,895 7,442 7,478 8,167 37 Balances with domestic banks 16,091 18,057 15,588 16,063 15,598 16,668 16,286 16,505 18,121 38 Investments in subsidiaries not consolidated... 3,490 3,482 3,453 3,515 3,498 3,494 3,425 3,450 3,506 39 Other assets 66,245 68,847 69,566 69,610 68,465 68,686 69,079 69,447 70,415 40 Total assets/total liabilities 652,242 661,216 660,680 659,533 657,262 658,112 662,985 674,888 689,937 Deposits: 41 Demand deposits 201,316 204,723 203,106 193,786 191,693 196,902 198,861 208,086 212,468 42 Individuals, partnerships, and corporations 143,544 141,888 146,071 140,371 138,612 141,194 144,949 147,468 151,617 43 States and political subdivisions 6,709 5,559 6,674 5,879 5,672 5,672 5,624 6,099 6,220 44 U.S. Government 1,304 1,038 1,559 977 952 1,121 1,031 2,991 1,082 Domestic interbank: 45 Commercial 31,091 38,541 31,054 30,196 29,773 32,424 29,883 32,788 35,449 46 Mutual savings 955 953 873 773 711 856 705 740 766 Foreign: 47 Governments, official institutions, etc..., 1,606 1,314 1,402 1,297 1,354 1,306 1,961 1,535 1,705 48 Commerial banks 6,838 7,421 6,934 6,740 6,465 6,375 7,014 7,846 8,251 49 Certified and officers' checks 9,269 8,009 8,539 7,553 8,154 7,954 7,694 8,619 7,378 50 Time and savings deposits3 276,645 278.057 279,234 281,053 280,971 282,086 284,094 284,106 284,124 51 Savings4 * 90,892 90,999 90,495 90,276 90,047 90,052 89,729 89,413 89,628 52 Time: 185,753 187.058 188,739 190,777 190,924 192,034 194,365 194,693 194,496 53 Individuals, partnerships, and corps. 143,885 144,813 146,354 147,863 148,287 149,557 151,408 151,606 151,727 54 States and political subdivisions 26,530 26,802 26,626 27,048 26,809 26,726 27,051 26,960 26,809 55 Domestic interbank 7,134 7,191 7,437 7,525 7,644 7,784 8,086 8,296 8,268 56 Foreign govts., official institutions, etc.., 6,503 6,589 6,623 6,645 6,487 6,236 6,156 6,205 6,088 57 Federal funds purchased, etc.5 81,815 83,824 81,344 84,751 84,899 82,114 83,492 80,763 86,359 Borrowings from: 58 Federal Reserve Banks 1,123 470 945 594 795 237 134 177 2,647 59 Others 8,136 10,059 10,737 14,226 12,818 10,088 9,648 14,910 16,862 60 Other liabilities, etc. 6 35,684 36,481 37,801 37,573 38,438 38,882 38,826 39,118 39,562 61 Total equity capital and subordinated notes/debentures7 47,523 47,602 47,513 47,550 47,648 47,803 47,930 47,728 47,915 1 Includes securities purchased under agreements to resell. 5 Includes securities sold under agreements to repurchase. 2 Federal agencies only. 6 Includes minority interest in consolidated subsidiaries and deferred 3 Includes time deposits of U.S. Govt, and of foreign banks, which are tax portion of reserves for loans. not shown separately. 7 Includes reserves for securities and contingency portion of reserve 4 For amounts of these deposits by ownership categories, see Table 1.30. for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Banks A21 1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1978 Nov 1 Nov 8 Nov 15 Nov 22 Nov 29 Dec. 6p Dec. 13p Dec. 20p Dec 21* 1 Total loans and investments.... 99,672 101,323 100,781 100,092 99,600 98,979 99,469 103,188 103,075 Loans Federal funds sold1 4,843 6,131 5,101 5,946 6,351 4,449 4,416 6,056 5,580 To commercial banks 2,265 3,949 2,736 3,835 4,511 2,662 2,418 4,598 4,310 To brokers and dealers involving— U S Treasury securities 1,374 1,479 1,788 1,647 1,464 1,353 1,500 1,253 1,082 Other securities 6 10 14 9 2 3 7 42 6 To others 1,198 693 563 455 374 431 491 163 182 Other gross.... . . . . 77,294 77,765 77,557 76,466 75,966 77,133 77,143 79,558 79,863 Commercial and industrial 38,234 38,390 38,547 38,269 38,114 38,506 38,564 39,375 39,506 Agricultural 181 185 189 189 189 188 189 197 192 For purchasing or carrying securities To brokers and dealers- 10 U S Treasury securities 1,025 1,407 1,543 1,180 759 1,565 1,469 1,170 690 Other securities 4,683 4,025 4,133 3,756 3,739 3,614 3,610 4,466 4,005 To others 12 U S. Treasury securities 27 27 27 27 27 27 27 28 28 13 Other securities... 354 340 340 338 333 338 339 340 341 To nonbank financial institutions- 14 Personal and sales finance cos., etc 3,301 3,170 3,123 2,868 2,966 3,002 2,913 3,117 3,326 15 Other... 4,778 4,757 4,530 4,441 4,506 4,466 4,538 4,592 4,530 16 Real estate... 9,856 9,875 9,921 9,982 9,964 9,974 10,011 10,045 10,109 To commercial banks • 17 Domestic 851 1,212 941 877 1,077 1,064 948 1,102 1,356 18 Foreign 3,803 4,226 3,829 3,931 3,783 3,834 3,967 4,316 4,761 19 Consumer instalment 5,042 5,059 5,250 5,285 5,293 5,343 5,373 5,547 5,656 20 Foreign govts official institutions, etc .... 529 527 550 582 644 524 631 589 660 21 All other loans 4,630 4,565 4,634 4,741 4,572 4,688 4,564 4,674 4,703 22 LESS Loan loss reserve and unearned income on loans 1,910 1,911 1,932 1,943 1,953 1,962 1,985 1,980 1,961 23 Other loans, net 75,384 75,854 75,625 74,523 74,013 75,171 75,158 17,578 77,902 Investments U S Treasury securities 8,276 8,261 8,934 8,436 8,283 8,332 8,567 8,532 8,633 Bills 781 751 111 875 797 841 1,163 1,254 1,349 Notes and bonds, by maturity: Within 1 year 741 835 844 849 933 873 945 976 1,023 1 to 5 years 5,749 5,721 5,819 5,315 5,176 5,298 5,171 5,024 4,983 After 5 years 1,005 954 1,494 1,397 1,377 1,320 1,288 1,278 1,278 Other securities 11,169 11,077 11,121 11,187 10,953 11,027 11,328 11,022 10,960 Obligations of States and political subdivisions. Tax warrants, short-term notes, and bills. 1,829 1,677 1,783 1,722 1,630 1,533 1,675 1,518 1,430 All other 6,937 6,994 6,992 7,004 6,998 7,031 7,079 7,062 7,080 Other bonds, corporate stocks, and securities 32 Certificates of participation2 520 521 521 520 518 518 532 525 517 33 All other, including corporate stocks 1,883 1,885 1,825 1,941 1,807 1,945 2,042 1,917 1,933 34 Cash items in process of collection 16,825 17,060 16,251 15,545 15,911 15,350 15,418 16,860 17,735 35 Reserves with Federal Reserve Banks 4,698 8,374 5,890 5,052 5,533 5,804 7,400 7,392 9,275 36 Currency and coin 1,014 1,029 1,068 981 1,137 1,091 1,186 1,160 1,235 37 Balances with domestic banks 8,990 10,621 8,051 8,753 8,105 9,218 8,936 8,355 9,350 38 Investments in subsidiaries not consolidated... 1,819 1,843 1,852 1,853 1,852 1,854 1,842 1,842 1,848 39 Other assets 25,933 27,322 27,414 28,768 27,524 26,994 27,590 26,980 27,690 40 Total assets/total liabilities. 158,951 167,572 161,307 161,044 159,662 159,290 161,841 165,777 170,208 Deposits 4 41 2 Dem In an d d i vid d u ep a o l s s i , ts partnerships, and corporations 5 2 6 9 ,9 ,7 27 2 7 2 63 9 ,2 ,3 58 8 1 2 55 9 ,7 ,7 80 5 8 2 54 8 ,0 , 1 5 6 7 0 5 2 3 7 ,3 , 9 8 8 2 8 5 2 4 8 ,6 , 2 3 3 2 4 5 2 5 9 ,0 , 3 1 6 7 9 5 3 9 0 ,9 , 6 0 1 3 6 6 3 1 0 ,2 , 9 6 1 2 4 43 States and political subdivisions 747 438 628 474 424 441 394 454 462 44 US Government 82 114 158 75 77 97 127 672 100 Domestic interbank: 45 Commercial 15,110 22,733 14,634 15,319 15,209 16,201 14,638 17,143 19,049 46 Mutual savings 469 515 448 375 345 418 324 351 375 Foreign 47 Governments, official institutions, etc— 1,346 1,052 1,173 1,068 1,088 1,068 1,726 1,258 1,444 48 Commercial banks 4,899 5,393 5,170 5,005 4,607 4,575 5,060 5,897 6,364 49 Certified and officers' checks 4,547 3,632 3,811 3,130 3,820 3,499 3,588 4,150 2,873 5 5 0 1 Tim S e av a i n n d g s s 4 a vings deposits3 48 9 ,1 ,3 08 9 2 48 9 ,5 , 1 3 8 9 0 49 9 ,8 ,3 28 4 3 50 9 ,2 ,3 90 2 3 50 9 ,1 , 6 2 1 9 6 50 9 ,4 ,2 91 9 1 50 9 ,7 ,3 82 0 1 50 9 ,9 ,2 15 4 6 50 9 ,6 ,2 85 7 0 52 Time . . . 38,716 39,128 40,485 40,967 40,865 41,200 41,481 41,669 41,415 53 Individuals, partnerships and corps . 29,372 29,586 30,478 30,853 30,864 31,308 31,564 31,695 31,574 54 States and political subdivisions 2,061 2,099 2,122 2,138 2,102 2,046 2,009 1,976 1,936 5 5 5 6 D Fo o r m ei e g s n t ic g o in vt t s e r , b o a f n f k ic ial institutions, etc... 2 3 , , 6 8 4 2 2 2 2 3 , , 7 8 8 4 8 8 3 3 , , 9 0 4 9 2 4 4 3 , , 0 1 2 3 2 3 3 3, , 9 1 2 4 5 9 3 3, , 8 1 3 8 3 2 3 3, , 8 2 2 6 1 6 3 3 , , 4 8 2 0 7 0 3 3 , , 3 7 8 5 6 6 57 Federal funds purchased, etc 5 20,149 22,093 20,180 21,391 21,381 20,097 22,541 20,000 20,879 Borrowings from 58 Federal Reserve Banks 480 * 716 * 189 * * * 1,403 59 Others 4,329 4,771 5,039 5,694 5,112 4,585 4,420 5,672 5,639 60 Other liabilities, etc 6 15,537 15,507 16,332 16,215 15,973 15,987 15,549 15,812 16,845 61 Total equity capital and subordinated notes/ debentures 7 13,421 13,425 13,432 13,438 13,448 13,507 13,513 13,417 13,466 1 Includes securities purchased under agreements to resell. 5 Includes securities sold under agreements to repurchase. 2 Federal agencies only. 6 Includes minority interest in consolidated subsidiaries and deferred 3 Includes time deposits of U.S. Govt, and of foreign banks, which tax portion of reserves for loans. are not shown separately. 7 Includes reserves for securities and contingency portion of reserves 4 For amounts of these deposits by ownership categories, see Table 1.30. for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A22 Domestic Nonfinancial Statistics • January 1979 1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS OUTSIDE NEW YORK CITY Assets and Liabilities Millions of dollars, Wednesday figures 1978 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Dec. 6p Dec. 13 p Dec. 20p Dec. 27p 1 Total loans and investments. 386,809 393,491 391,624 390,726 390,751 394,108 392,762 398,985 400,542 Loans: Federal funds sold1 19,804 25,393 21,783 20,578 20,418 24,062 21,731 25,254 25,515 To commercial banks 15,935 20,357 17,277 16,077 16,356 16,885 16,590 18,914 20,616 To brokers and dealers involving— U.S. Treasury securities 1,520 2,740 2,036 1,962 1,695 4,324 2,515 3,566 1,967 Other securities 742 712 764 842 782 857 793 917 1,086 To others 1,607 1,584 1,706 1,697 1,585 1,996 1,833 1,857 1,846 Other, gross 284,339 285,265 286,377 286,983 287,331 287,275 287,703 289,955 291,128 Commercial and industrial 101,717 102,000 102,266 102,343 102,544 102,149 101,993 102,454 102,597 Agricultural 5,190 5,153 5,179 5,131 5,106 5,067 5,059 5,079 5,160 For purchasing or carrying securities: To brokers and dealers: 10 U.S. Treasury securities 108 234 173 112 91 89 102 169 82 11 Other securities 4,477 4,333 3,967 3,765 3,638 3,476 3,372 3,651 3,786 To others: 12 U.S. Treasury securities 82 84 82 84 84 77 85 95 101 13 Other securities 2,216 2,250 2,256 2,244 2,226 2,230 2,244 2,253 2,253 To nonbank financial institutions: 14 Personal and sales finance cos., etc 5,571 5,582 5,657 5,579 5,533 5,598 5,589 5,859 5,866 15 Other 11,042 11,131 11,218 11,160 11,114 11,176 11,269 11,223 11,327 16 Real estate 77,860 78,051 78,533 78,843 79,049 79,273 79,619 79,859 80,103 To commercial banks: 17 Domestic 1,823 1,903 1,855 2,031 2,035 1,883 1,820 2,047 2,059 18 Foreign 4,057 4,328 4,523 4,567 4,651 4,720 4,790 4,845 4,923 19 Consumer instalment 50,169 50,252 50,481 50,673 50,994 51,112 51,403 51,767 52,104 20 Foreign govts., official institutions, etc 1,440 1,532 1,567 1,536 1,533 1,523 1,537 1,492 1,491 21 All other loans 18,587 18,432 18,620 18,915 18,733 18,902 18,821 19,162 19,276 22 LESS: Loan reserve and unearned income on loans 9,092 9,164 9,202 9,264 9,260 9,276 9,302 9,334 9,290 23 Other loans, net 275,247 276,101 277,175 277,719 278,071 277,999 278,401 280,621 281,838 Investments: U.S. Treasury securities 33,207 33,072 33,487 33,201 33,034 32,743 32,757 32,851 32,878 Bills 2,547 2,501 2,295 2,340 2,339 2,214 2,268 2,411 2,531 Notes and bonds, by maturity: Within 1 year 6,438 6,513 6,470 6,623 6,652 6,902 6,848 6,945 6,956 1 to 5 years 19,748 19,551 20,040 19,664 19,528 19,119 19,169 19,032 18,956 After 5 years 4,474 4,507 4,682 4,574 4,515 4,508 4,472 4,463 4,435 Other securities 58,551 58,925 59,179 59,228 59,228 59,304 59,873 60,259 60,311 Obligations of States and political subdivisions: 30 Tax warrants, short-term notes, and bills. 4,694 4,803 4,816 4,689 4,647 4,633 4,779 4,610 4,592 31 Allother 38,760 39,048 39,253 39,346 39,344 39,215 39,375 39,492 39,493 Other bonds, corporate stocks, and securities: 32 Certificates of participation2. . . 2,377 2,361 2,404 2,356 2,424 2,435 2,499 2,504 2,578 33 All other, including corporate stocks 12,720 12,713 12,706 12,837 12,813 13,021 13,220 13,653 13,648 34 Cash items in process of collection 33,879 31,959 35,233 33,897 30,809 32,221 33,097 35,211 38,100 35 Reserves with Federal Reserve Banks 17,979 12,138 15,480 18,484 19,343 15,907 18,607 16,372 21,001 36 Currency and coin 5,540 5,456 5,746 5,568 6,617 5,804 6,256 6,318 6,932 37 Balances with domestic banks 7,101 7,436 7,537 7,310 7,493 7,450 7,350 8,150 8,771 38 Investments in subsidiaries not consolidated 1,671 1,639 1,601 1,662 1,646 1,640 1,583 1,608 1,658 39 Other assets 40,312 41,525 42,152 40,842 40,941 41,692 41,489 42,467 42,725 40 Total assets/total liabilities. 493,291 493,644 499,373 498,489 497,600 498,822 501,144 509,111 519,729 Deposits: Demand deposits 144,389 141,465 147,326 139,770 138,295 142,279 143,825 148,125 151,177 Individuals, partnerships, and corporations. 113,817 112,507 116,313 111,801 110,784 112,870 115,770 117,432 120,993 States and political subdivisions 5,962 5,121 6,046 5,405 5,248 5,231 5,230 5,645 5,758 U.S. Government 1,222 924 1,401 902 875 1,024 904 2,319 982 Domestic interbank: Commercial 15,981 15,808 16,420 14,877 14,564 16,223 15,245 15,645 16,400 Mutual savings 486 438 425 398 366 438 381 389 391 Foreign: Governments, official institutions, etc 260 262 229 229 266 238 235 277 261 Commercial banks 1,939 2,028 1,764 1,735 1,858 1,800 1,954 1,949 1,887 Certified and officers' checks 4,722 4,377 4,728 4,423 4,334 4,455 4,106 4,469 4,505 Time and savings deposits 3 228,537 229,539 229,406 230,763 230,810 231,595 233,312 233,191 233,439 Savings4 81,500 81,609 81,152 80,953 80,751 80,761 80,428 80,167 80,358 Time 147,037 147,930 148,254 149,810 150,059 150,834 152,884 153,024 153,081 Individuals, partnerships, and corps 114,513 115,227 115,876 117,010 117,423 118,249 119,844 119,911 120,153 States and political subdivisions 24,469 24,703 24,504 24,910 24,707 24,680 25,042 24,984 24,873 Domestic interbank 4,492 4,403 4,343 4,392 4,495 4,602 4,820 4,869 4,882 Foreign govts., official institutions, etc... 2,681 2,741 2,681 2,623 2,562 2,403 2,335 2,405 2,332 57 Federal funds purchased, etc. 5 61,666 61,731 61,164 63,360 63,518 62,017 60,951 60,763 65,480 Borrowings from: 58 Federal Reserve Banks 643 470 229 594 606 237 134 177 1,244 59 Others 3,807 5,288 5,698 8,532 7,706 5,503 5,228 9,238 11,223 60 Other liabilities, etc.6 20,147 20,974 21,469 21,358 22,465 22,895 23,277 23,306 22,in 61 Total equity capital and subordinated notes/debentures 7 34,102 34,177 34,081 34,112 34,200 34,296 34,417 34,311 34,449 1 Includes securities purchased under agreements to resell. 5 Includes securities sold under agreements to repurchase. 2 Federal agencies only. 6 Includes minority interest in consolidated subsidiaries and deferred 3 Includes time deposits of U.S. Govt, and of foreign banks, which tax portion of reserves for loans. are not shown separately. 7 Includes reserves for securities and contingency portion of reserves 4 For amounts of these deposits by ownership categories, see Table 1.30. for loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Weekly Reporting Banks A23 1.30 LARGE WEEKLY REPORTING COMMERCIAL BANKS Balance Sheet Memoranda Millions of dollars, Wednesday figures 1978 Nov. 1 Nov. 8 Nov. 15 Nov. 22 Nov. 29 Dec. 6p Dec. 13 p Dec. 20p Dec. 21p Total loans (gross) and investments adjusted1 1 Large Banks 476,609 478,468 480,730 479,205 477,585 481,831 481,742 486,826 486,527 2 New York City banks 98,466 98,073 99,036 97,323 95,965 97,215 98,088 99,468 99,370 3 Banks outside New York City 378,143 380,395 381,694 381,882 381,620 384,616 383,654 387,358 387,157 Total loans (gross), adjusted 4 Large banks 365,406 367,133 368,009 367,153 366,087 370,425 369,217 374,162 373,745 5 New York City banks 79,021 78,735 78,981 77,700 76,729 77,856 78,193 79,914 79,777 6 Banks outside New York City 286,385 288,398 289,028 289,453 289,358 292,569 291,024 294,248 293,968 Demand deposits, adjusted2 7 Large Banks 118,217 116,125 119,009 113,171 114,248 115,786 119,432 120,236 120,102 8 New York City banks 24,910 23,351 24,737 23,077 22,201 22,975 24,853 25,286 24,407 9 Banks outside New York City 93,307 92,11A 94,272 90,094 92,047 92,811 94,579 94,950 95,695 Large negotiable time CD's included in time and savings deposits3 Total: 10 Large banks 94,306 95,428 96,673 97,589 91 Ml 98,322 100,172 100,248 99,991 11 New York City 26,956 27,382 28,606 29,003 28,916 29,180 29,428 29,597 29,358 12 Banks outside New York City 67,350 68,046 68,067 68,586 68,731 69,142 70,744 70,651 70,633 Issued to IPC's: 13 Large banks 67,286 68,122 69,154 69,992 70,269 71,070 72,635 72,618 72,609 14 New York City Banks 19,137 19,389 20,190 20,486 20,479 20,821 21,020 21,083 21,003 15 Banks outside New York City 48,149 48,733 48,964 49,506 49,790 50,249 51,615 51,535 51,606 Issued to others: 16 Large banks 27,020 27,306 27,519 27,597 27,378 27,252 27,537 27,630 27,382 17 New York City banks 7,819 7,993 8,416 8,517 8,437 8,359 8,408 8,514 8,355 18 Banks outside New York City 19,201 19,313 19,103 19,080 18,941 18,893 19,129 19,116 19,027 All other large time deposits4 Total: 19 Large banks 35,723 36,041 36,122 36,875 36,916 37,141 37,558 37,770 37,565 20 New York City banks 6,948 7,021 6,958 7,025 7,032 7,058 7,058 7,059 7,053 21 Banks outside New York City 28,775 29,020 29,164 29,850 29,884 30,083 30,500 30,641 30,512 Issued to IPC's: 22 Large banks 21,805 21,908 22,035 22,390 22,498 22,677 22,911 22,982 22,969 23 New York City banks 5,602 5,580 5,455 5,507 5,546 5,596 5,614 5,652 5,625 24 Banks outside New York City 16,203 16,328 16,580 16,883 16,952 17,081 17,297 17,330 17,344 Issued to others: 25 Large banks 13,918 14,133 14,087 14,485 14,418 14,464 14,647 14,718 14,596 26 New York City banks 1,346 1,441 1,503 1,518 1,486 1,462 1,444 1,407 1,428 27 Banks outside New York City 12,572 12,692 12,584 12,967 12,932 13,002 13,203 13,311 13,168 Savings deposits, by ownership category Individuals and nonprofit organizations: 28 Large banks 84,661 84,736 84,301 84,140 83,894 83,872 83,598 83,394 83,616 29 New York City banks 8,741 8,737 8,719 8,704 8,669 8,665 8,670 8,634 8,660 30 Banks outside New York City 75,920 75,999 75,582 75,436 75,225 75,207 74,928 74,760 74,956 Partnerships and corporations for profit:5 31 Large banks 5,115 5,139 5,105 5,055 5,064 5,064 5,005 4,902 4,911 32 New York City banks 462 457 449 440 448 451 444 430 435 33 Banks outside New York City 4,653 4,682 4,656 4,615 4,616 4,613 4,561 4,472 4,476 Domestic governmental units: 34 Large banks 1,095 1,096 1,065 1,058 1,065 1,074 1,086 1,078 1,059 35 New York City banks 180 180 166 168 167 159 169 166 161 36 Banks outside New York City 915 916 899 890 898 915 917 912 898 All other:6 37 Large banks 21 28 24 23 24 42 40 39 42 38 New York City banks 9 16 9 11 12 16 18 16 14 39 Banks outside New York City 12 12 15 12 12 26 22 23 28 Gross liabilities of banks to their foreign branches 40 Large banks 8,614 7,995 9,772 7,737 8,967 9,893 9,958 9,965 10,115 41 New York City banks 5,253 4,762 6,220 3,984 4,440 5,328 5,369 5,841 6,102 42 Banks outside New York City 3,361 3,233 3,552 3,753 4,527 4,565 4,589 4,124 4,013 Loans sold outright to selected institutions by all large banks7 43 Commercial and industrials 1,911 1,898 1,846 1,796 1,859 1,819 1,844 1,905 1,807 44 Real estates 291 295 296 305 297 294 301 302 304 45 All other 8 1,592 1,563 1,540 1,569 1,564 1,641 1,628 1,576 1,665 1 Exclusive of loans and Federal funds transactions with domestic 5 Other than commercial banks. commercial banks. 6 Domestic and foreign commercial banks, and official international 2 All demand deposits except U.S. Govt, and domestic commercial organizations. banks, less cash items in process of collection. 7 To bank's own foreign branches, nonconsolidated nonbank af- 3 Certificates of deposit (CD's) issued in denominations of $100,000 or filiates of the bank, the bank's holding company (if not a bank), and more. nonconsolidated nonbank subsidiaries of the holding company. 4 All other time deposits issued in denominations of $100,000 or more 8 Data revised beginning July 7, 1977, due to reclassifications at one not included in large negotiable CD's. large bank. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A24 Domestic Nonfinancial Statistics • January 1979 1.31 LARGE WEEKLY REPORTING COMMERCIAL BANKS Commercial and Industrial Loans Millions of dollars Outstanding Net change during— Industry classification 1978 1978 1978 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27^ Q3 Q4*> Oct. Nov. Dec.f Total loans classified2 1 Total 114,541 114,799 114,549 115,578 115,773 1,354 4,323 1,863 1,228 1,232 Durable goods manufacturing: 2 Primary metals 2,595 2,624 2,643 2,672 2,662 -66 -70 -68 -69 67 3 Machinery 5,473 5,513 5,415 5,408 5,348 -16 -40 61 24 -125 4 Transportation equipment 2,627 2,571 2,593 3,110 3,096 -52 349 -159 39 469 5 Other fabricated metal products... 2,414 2,451 2,447 2,405 2,471 69 -51 -78 -30 57 6 Other durable goods 3,986 4,062 4,050 4,046 3,992 136 -53 -79 20 6 Nondurable goods manufacturing: 7 Food, liquor, and tobacco 4,550 4,642 4,628 4,613 4,681 -101 527 186 210 131 8 Textiles, apparel, and leather 3,976 3,999 3,930 3,833 3,756 240 -627 -110 -297 -220 9 Petroleum refining 2,552 2,569 2,570 2,660 2,637 -116 116 —47 78 85 10 Chemicals and rubber 3,232 3,275 3,357 3,453 3,465 -101 -3 -173 -63 233 11 Other nondurable goods 2,440 2,424 2,405 2,400 2,380 213 -100 -47 7 -60 12 Mining, including crude petroleum and natural gas 10,622 10,594 10,607 10,629 10,583 172 6 17 28 -39 Trade: 13 Commodity dealers 1,793 1,859 1,870 1,872 1,952 -323 208 61 -12 159 14 Other wholesale 9,530 9,502 9,443 9,433 9,367 232 195 279 79 -163 15 Retail 8,939 8,855 8.711 8,557 8,412 -80 218 636 109 -527 5,520 5,494 5,515 5,469 5,494 53 34 -8 -26 17 Communication 1,774 1,782 1,748 1,772 1,765 68 32 -20 61 -9 18 Other public utilities 5,545 5,587 5,586 5,741 5,940 89 841 245 201 395 19 Construction 5,106 5,040 5,031 5,035 5,098 118 -73 -16 -49 -8 20 Services 14,422 14,509 14,484 14,750 14,782 520 823 219 244 360 21 All other domestic loans 8,458 8,449 8,473 8,392 8,504 282 468 257 165 46 22 Bankers acceptances 3,542 3,591 3,543 3,766 3,808 -149 696 210 220 266 23 Foreign commercial and industrial 5,445 5,407 5,500 5,562 5,580 166 861 455 271 135 MEMO ITEMS: 24 Commercial paper included in total classified loans * 6622 4455 --88 -1 --1177 25 Total commercial and industrial loans of all large weekly reporting banks 140,658 140,655 140,557 141,829 142,103 1,390 5,394 2,125 1,824 1,445 1978 1978 1978 Aug. 30 Sept. 27 Oct. 25 Nov. 29 Dec. 27 Q3 Q4P Oct. Nov. Dec.® "Term" loans classified3 26 Total 52,618 53,019 53,762 54,861 55,439 1,726 2,420 743 1,099 578 Durable goods manufacturing: 27 Primary metals 1,710 11,,667722 1,641 11,,663311 1,624 -34 -48 -31 -10 -7 28 Machinery 2,669 2,650 2,768 2,751 2,771 74 121 118 -17 20 29 Transportation equipment 1,586 1,565 1,506 1,517 1,663 145 98 -59 11 146 30 Other fabricated metal products... 990 1,007 1,004 1,040 1,119 13 112 -3 36 79 31 Other durable goods 1,699 1,713 1,717 1,815 1,902 35 189 4 98 87 Nondurable goods manufacturing: 32 Food, liquor, and tobacco 1,740 1,727 1,862 1,978 1,918 56 191 135 116 -60 33 Textiles, apparel, and leather 1,133 1,126 1,096 1,046 1,050 4 -76 -30 -50 4 34 Petroleum refining 1,882 1,846 1,789 1,843 1,895 -101 49 -57 54 52 35 Chemicals and rubber 2,322 2,301 2,109 2,043 2,181 -111 -120 -192 -66 138 36 Other nondurable goods 1,156 1,177 1,192 1,218 1,183 86 6 15 26 -35 37 Mining, including crude petroleum and natural gas 7,757 7,862 7,852 7,930 7,937 102 75 -10 78 7 Trade: 38 Commodity dealers 248 250 268 305 314 22 64 18 37 9 39 Other wholesale 2,276 2,360 2,329 2,372 2,342 185 -18 -31 43 -30 40 Retail 2,827 2,791 3,065 3,225 3,204 -43 413 274 160 -21 41 Transportation 3,732 3,753 3,718 3,746 3,790 15 37 -35 28 44 42 Communication 1,057 1,076 1,065 1,131 1,158 67 82 — 11 66 27 43 Other public utilities 3,860 3,847 3,960 4,064 4,221 318 374 113 104 157 44 Construction 2,245 2,224 2,264 2,295 2,373 107 149 40 31 78 45 Services 6,606 6,797 6,936 7,113 7,270 307 473 139 177 157 2,616 2,713 22,,779988 2,857 2,866 393 153 85 59 9 47 Foreign commercial and industrial 2,507 2,562 2,823 2,941 2,658 86 96 261 118 -283 1 Reported for the last Wednesday of each month. all outstanding loans granted under a formal agreement—revolving credit 2 Includes "term" loans, shown below. or standby—on which the original maturity of the commitment was in 3 Outstanding loans with an original maturity of more than 1 year and excess of 1 year. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Deposits and Commercial Paper A25 1.32 GROSS DEMAND DEPOSITS of Individuals, Partnerships, and Corporations Billions of dollars, estimated daily-average balances At commercial banks TTTyyypppeee ooofff hhhooollldddeeerrr 1977 1978 11997744 11997755 11997766 DDeecc.. DDeecc.. DDeecc.. Mar. June Sept. Dec. Mar. June Sept. 11111 AAAAAllllllllll hhhhhooooollllldddddeeeeerrrrrsssss,,,,, iiiiinnnnndddddiiiiivvvvviiiiiddddduuuuuaaaaalllllsssss,,,,, pppppaaaaarrrrrtttttnnnnneeeeerrrrrssssshhhhhiiiiipppppsssss,,,,, aaaaannnnnddddd 225.0 236.9 250.1 242.3 253.8 252.7 274.4 262.5 271.2 278.8 cccccooooorrrrrpppppooooorrrrraaaaatttttiiiiiooooonnnnnsssss 19.0 20.1 22.3 21.6 25.9 23.7 25.0 24.5 25.7 25.9 22222 FFFFFiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 118.8 125.1 130.2 125.1 129.2 128.5 142.9 131.5 137.7 142.5 73.3 78.0 82.6 81.6 84.1 86.2 91.0 91.8 92.9 95.0 44444 CCCCCooooonnnnnsssssuuuuummmmmeeeeerrrrr 2.3 2.4 2.7 2.4 2.5 2.5 2.5 2.4 2.4 2.5 11.7 11.3 12.4 11.6 12.2 11.8 12.9 12.3 12.4 13.1 66666 OOOOOttttthhhhheeeeerrrrr At weekly reporting banks 1978 11997755 11997766 11997777 DDeecc.. DDeecc.. DDeecc.. May June July Aug. Sept. Oct. Nov. 77777 AAAAAllllllllll hhhhhooooollllldddddeeeeerrrrrsssss,,,,, iiiiinnnnndddddiiiiivvvvviiiiiddddduuuuuaaaaalllllsssss,,,,, pppppaaaaarrrrrtttttnnnnneeeeerrrrrssssshhhhhiiiiipppppsssss,,,,, aaaaannnnnddddd cccccooooorrrrrpppppooooorrrrraaaaatttttiiiiiooooonnnnnsssss 124.4 128.5 139.1 134.3 136.9 139.9 137.7 139.7 141.3 142.7 88888 FFFFFiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 15.6 17.5 18.5 18.1 19.0 19.4 19.4 18.9 19.1 19.3 99999 NNNNNooooonnnnnfffffiiiiinnnnnaaaaannnnnccccciiiiiaaaaalllll bbbbbuuuuusssssiiiiinnnnneeeeessssssssss 69.9 69.7 76.3 70.7 71.9 73.7 72.0 74.1 75.0 75.7 1111100000 CCCCCooooonnnnnsssssuuuuummmmmeeeeerrrrr 29.9 31.7 34.6 36.0 36."6 37.1 36.8 37.1 37.5 37.7 2.3 2.6 2.4 2.4 2.3 2.3 2.4 2.4 2.5 2.5 1111122222 OOOOOttttthhhhheeeeerrrrr 6.6 7.1 7.4 7.1 7.1 7.3 7.1 7.3 7.2 7.5 NOTE.—Figures include cash items in process of collection. Estimates of banks. Types of depositors in each category are described in the June 1971 gross deposits are based on reports supplied by a sample of commercial BULLETIN, p. 466. 1.33 COMMERCIAL PAPER AND BANKERS ACCEPTANCES OUTSTANDING Millions of dollars, end of period 1978 11997755 11997766 11997777 IInnssttrruummeenntt DDeecc.. DDeecc.. DDeecc.. May June July Aug. Sept. Oct. Nov. Commercial paper (seasonally adjusted) 1111 AAAAHHHH iiiissssssssuuuueeeerrrrssss 48,459 53,025 65,209 71,213 74,536 74,900 73,960 •76,988 77,152 80,504 FFFFiiiinnnnaaaannnncccciiiiaaaallll ccccoooommmmppppaaaannnniiiieeeessss::::1111 DDDDeeeeaaaalllleeeerrrr----ppppllllaaaacccceeeedddd ppppaaaappppeeeerrrr::::2222 2222 TTTToooottttaaaallll 6,202 7,250 8,871 10,314 10,327 10,617 10,868 '11,470 10,921 11,455 3333 BBBBaaaannnnkkkk----rrrreeeellllaaaatttteeeedddd 1,762 1,900 2,132 2,217 2,442 2,633 2,935 2,622 2,868 3,231 DDDDiiiirrrreeeeccccttttllllyyyy----ppppllllaaaacccceeeedddd ppppaaaappppeeeerrrr::::3333 4444 TTTToooottttaaaallll 31,374 32,500 40,496 44,664 47,315 46,594 45,510 47,791 48,030 50,010 5555 BBBBaaaannnnkkkk----rrrreeeellllaaaatttteeeedddd 6,892 5,959 7,102 9,258 9,585 10,030 9,634 10,383 10,925 11,478 6666 NNNNoooonnnnffffiiiinnnnaaaannnncccciiiiaaaallll ccccoooommmmppppaaaannnniiiieeeessss4444 10,883 13,275 15,842 16,235 16,894 17,689 17,582 '17,727 18,201 19,039 Dollar acceptances (not seasonally adjusted) 7777 TTTToooottttaaaallll 1188,,772277 2222,,552233 2255,,665544 26,714 2288,,228899 27,579 28,319 2277,,995522 30,579 32,145 HHHHeeeelllldddd bbbbyyyy:::: 8888 AAAAcccccccceeeeppppttttiiiinnnngggg bbbbaaaannnnkkkkssss 77,,333333 1100,,444422 1100,,443344 7,286 77,,550022 7,244 7,048 77,,664477 8,379 9,268 9999 OOOOwwwwnnnn bbbbiiiillllllllssss 55,,889999 88,,776699 88,,991155 6,365 66,,552200 6,345 6,131 66,,446611 7,012 8,025 11110000 BBBBiiiillllllllssss bbbboooouuuugggghhhhtttt 11,,443355 11,,667733 11,,551199 921 998833 899 917 11,,118866 1,366 1,243 FFFFeeeeddddeeeerrrraaaallll RRRReeeesssseeeerrrrvvvveeee BBBBaaaannnnkkkkssss:::: 11111111 OOOOwwwwnnnn aaaaccccccccoooouuuunnnntttt 11,,112266 999911 995544 12 Foreign correspondents 229933 337755 336622 679 662255 568 633 555566 557 585 13 Others 99,,997755 1100,,771155 1133,,990044 18,749 2200,,116600 19,766 20,638 1199,,774488 21,644 22,292 Based on: 14 Imports into United States 33,,772266 44,,999922 66,,553322 7,027 77,,557788 7,415 7,885 77,,995577 8,575 8,675 15 Exports from United States 44,,000011 44,,881188 55,,889955 6,494 66,,990066 6,565 6,558 66,,335500 6,665 7,224 16 All other 1111,,000000 1122,,771133 1133,,222277 13,193 1133,,880055 13,599 13,876 1133,,664444 15,339 16,245 1 Institutions engaged primarily in activities such as, but not limited to, 3 As reported by financial companies that place their paper directly commercial, savings, and mortgage banking; sales, personal, and mortgage with investors. financing; factoring, finance leasing, and other business lending; insurance 4 Includes public utilities and firms engaged primarily in activities such underwriting; and other investment activities. as communications, construction, manufacturing, mining, wholesale and 2 Includes all financial company paper sold by dealers in the open retail trade, transportation, and services. market. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A26 Domestic Nonfinancial Statistics • January 1979 1.34 PRIME RATE CHARGED BY BANKS on Short-term Business Loans Per cent per annum Month Average Month Average Effective date Rate Effective date Rate rate rate 1978—Jan. 10. 1978—Sept. 15, 91/2 1977—Jan 6.25 1978—Jan 7.93 28, 9VA Feb 6.25 Feb 8.00 May 5, 8% Mar 6.25 8.00 26, 81/2 Oct. 13 10 Apr 6.25 8.00 27, 101/4 May 6.41 8.27 June 16. 8% June 6.75 8.63 30. 9 Nov. 1 lOi/i July 6.75 July 9.00 6 103/4 Aug 6.83 9.01 Aug. 31. 9% 17. 11 Sept 7.13 9.41 24 lH/2 Oct 7.52 Oct 9.94 Nov 7.75 10.94 Dec. 26 11% Dec 7.75 Dec 11.55 1.35 TERMS OF LENDING AT COMMERCIAL BANKS Survey of Loans Made, August 7-12, 1978 Size of loan (in thousands of dollars) All sizes 1,000 1-24 25-49 50-99 100-499 500-999 and over Short-term commercial and industrial loans 1 Amount of loans (thousands of dollars) 7,198,593 1,049,321 559,214 638,138 1,899,754 532,767 2,519,400 2 Number of loans 187,673 147,855 16,858 10,683 10,445 863 970 3 Weighted-average maturity (months) 3.0 2.8 3.4 2.4 3.0 3.3 3.1 4 Weighted-average interest rate (per cent per annum).. 9.97 10.45 10.19 10.30 10.19 9.93 9.47 5 Interquartile range 1 9.31-10.47 9.25-11.65 9.34-10.50 9.73-10.75 9.38-10.64 9.31-10.43 9.00-9.88 Percentage of amount of loans: 6 With floating rate 48.3 32.0 36.6 46.5 43.2 57.4 60.1 7 Made under commitment 38.1 15.2 21.0 27.5 31.2 58.5 54.9 Long-term commercial and industrial loans 8 Amount of loans (thousands of dollars) 1,417,990 293,717 355,547 99,274 669,452 9 Number of loans 22,251 19,735 2,218 150 148 10 Weighted-average maturity (months) 45.2 33.7 47.2 57.7 47.4 11 Weighted-average interest rate (per cent per annum).. 10.20 10.66 10.35 9.83 9.96 12 Interquartile range 1 9.38-11.00 9.89-11.57 9.38-11.02 9.25-10.50 9.00-10.48 Percentage of amount of loans: 13 With floating rate 65.5 30.1 62.3 55.1 84.3 14 Made under commitment 51.3 25.0 35.7 50.6 71.2 Construction and land development loans 15 Amount of loans (thousands of dollars) 1,177,413 228,314 144,262 155,635 381,591 267,611 16 Number of loans 30,901 22,364 4,546 2,278 1,490 223 17 Weighted-average maturity (months) 8.4 10.7 9.6 3.8 7.2 9.6 18 Weighted-average interest rate (per cent per annum).. 10.43 10.27 10.66 11.05 10.33 10.23 19 Interquartile range 1 9.95-11.02 9.27-10.87 10.00-11.00 10.00-12.73 10.03-10.70 9.27-11.30 Percentage of amount of loans: 20 With floating rate 49.3 12.3 13.0 18.3 80.2 74.3 21 Secured by real estate 92.9 85.4 97.1 94.5 97.1 90.3 22 Made under commitment 55.2 49.7 32.7 68.2 43.5 81.3 23 Type of construction: 1-to 4-family 42.1 77.2 71.3 64.9 20.2 14.5 24 Multifamily 8.5 1.2 10.0 1.7 7.8 18.8 25 Nonresidential 49.4 21.6 18.8 33.4 71.9 66.8 All 250 sizes 1-9 10-24 25-49 50-99 100-249 and over Loans to farmers 26 Amount of loans (thousands of dollars) 824,790 159,057 150,908 157,111 82,007 92,298 183,409 27 Number of loans 63,389 45,994 10,109 4,942 1,338 689 317 28 Weighted-average maturity (months) 6.6 7.5 6.6 10.2 6.1 5.8 3.9 29 Weighted-average interest rate (per cent per annum).. 9.62 9.33 9.33 9.46 9.51 9.92 10.15 30 Interquartile range 1 9.13-10.21 8.77-9.73 8.77-9.73 9.00-10.00 9.20-9.84 9.25-10.38 9.54-10.97 By purpose of loan: 31 Feeder livestock 9.49 9.13 9.11 9.37 9.48 9.60 9.91 32 Other livestock 9.47 9.36 9.44 10.03 8.86 10.19 9.76 33 Other current operating expenses 9.66 9.27 9.44 9.26 9.81 9.96 10.41 34 Farm machinery and equipment 9.63 9.52 9.53 9.86 9.41 (2) (2) 35 Other 9.87 9.61 9.22 9.67 9.77 10.39 10.28 1 Interest rate range that covers the middle 50 per cent of the total NOTE.—For more detail, see the Board's 416 (G.14) statistical release, dollar amount of loans made. 2 Fewer than three sample loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Securities Markets All 1.36 INTEREST RATES Money and Capital Markets Averages, per cent per annum 1978 1978, week ending— Instrument 1976 1977 1978 Sept. Oct. Nov. Dec. Dec. 2 Dec. 9 Dec. 16 Dec. 23 Dec. 30 Money market rates 1 Federal funds1 5.05 5.54 7.94 8.45 8.96 9.76 10.03 9.85 9.87 9.79 9.75 10.25 Prime commercial paper2-3 2 90- to 119-day 5.24 5.54 7.94 8.39 8.98 10.14 10.37 10.20 10.25 10.29 10.45 10.55 3 4- to 6 -month 5.35 5.60 7.99 8.44 9.03 10.23 10.43 10.28 10.32 10.36 10.50 10.61 4 Finance company paper, directly placed, 3- to 6-month3-4 5.22 5.49 7.78 8.18 8.78 9.82 10.06 9.89 9.95 9.99 10.14 10.22 5 Prime bankers acceptances, 90-day3-5 5.19 5.59 8.11 8.54 9.32 10.53 10.55 10.52 10.38 10.37 10.78 10.73 Large negotiable certificates of deposit 6 3-month, secondary market6 5.26 5.58 8.20 8.61 9.14 10.72 10.72 10.66 10.64 10.53 10.68 10.96 7 3-month, primary market7 5.15 5.52 8.01 8.42 9. 17 10.12 10.41 10.25 10.37 10.36 10.51 10.56 8 Euro-dollar deposits, 3-month8 5.57 6.05 8.74 9.12 10.12 11.51 11.62 11.66 11.56 11.33 11.60 11.95 U.S. Government securities Bills: 3.9 Market yields: 9 3-month 4.98 5.27 7.19 7.85 7.99 8.64 9.08 8.98 8.93 8.93 9.28 9.25 10 6-month 5.26 5.53 7.58 7.99 8.55 9.24 9.36 9.27 9.24 9.24 9.58 9.46 11 1-year 5.52 5.71 7.74 8.01 8.45 9.20 9.44 9.29 9.32 9.28 9.61 9.65 Rates on new issue:10 12 3-month 4.989 5.265 7.221 7.836 8.132 8.787 9.122 9.166 8.984 8.929 9.237 9.336 13 6-month 5.266 5.510 7.572 7.948 8.493 9.204 9.397 9.330 9.220 9.263 9.524 9.580 Capital market rates Government notes and bonds U.S. Treasury Constant maturities:11 14 1-year 5.88 6.09 8.. 34 8.64 9. 14 10.01 10.30 10.11 10. 14 10.12 10.49 10.54 15 2-year 6.45 8,. 34 8.57 8. 85 9.42 9.72 9. 56 9. .50 9.54 9.93 9.98 16 3-year 6.77 6.69 8.. 29 8.41 8. 62 9.04 9.33 9. 16 9. .12 9.19 9.52 9.59 17 5-year 7.18 6.99 8.. 32 8.43 8. 61 8.84 9.08 8. 92 8.. 89 8.97 9.25 9.32 18 7-year 7.42 7.23 8.. 36 8.42 8. 64 8.80 9.03 8. 88 8.. 86 8.95 9.19 9.22 19 10-year 7.61 7.42 8,. 41 8.42 8. 64 8.81 9.01 8. 85 8.. 86 8.95 9.14 9.14 20 20-year 7.86 7.67 8 .48 8.47 8. 69 8.75 8.90 8. 78 8.. 79 8.85 9.00 8.99 2211 30-year 8... 4499 88..4477 8. 6677 88..7755 8.88 8. 7788 8... 8800 88..8866 88..9988 88..9955 Notes and bonds maturing in —12 22 3 to 5 years 6.94 6.85 8,. 30 8.38 8. 61 8.97 9.23 9. 01 9. ,02 9.12 9.41 9.48 23 Over 10 years (long-term) 6.78 7.06 7.. 89 7.82 8. 07 8.16 8.36 8. 21 8.. 27 8.32 8.44 8.43 State and local: Moody's series:13 24 Aaa 5.66 5.20 5.. 52 5.53 5. 53 5.59 5.91 5. 55 5., 70 5.85 6.05 6.05 25 Baa 7.49 6.12 6.27 6.63 6. 18 6.65 6.76 6. 80 6.. 50 6.55 7.00 7.00 26 Bond Buyer series14 6.64 5.68 6.03 6.09 6. 13 6.19 6.51 6.29 6.29 6.45 6.67 6.61 Corporate bonds Seasoned issues15 27 All industries 9.01 8.43 9.. 07 9.08 9. 20 9.40 9.49 9. 39 9.40 9.44 9.55 9.62 By rating groups: 28 Aaa 8.43 8.02 8.. 73 8.78 8. 89 9.03 9.16 9. 04 9. ,06 9.12 9.24 9.27 29 Aa 8.75 8.24 8.. 92 8.96 9. 07 9.24 9.33 9. 22 9. 23 9.25 9.40 9.49 30 A 9.09 8.49 9. .12 9.11 9. 26 9.48 9.53 9.45 9.47 9.49 9.56 9.64 31 Baa 9.75 8.97 9.45 9.47 9. 59 9.83 9.94 9. 85 9. 85 9.89 9.99 10.08 Aaa utility bonds:16 32 New issue 8.48 8.19 R 8.86 9. 17 9 27 9.28 r9. 27 9. 28 9.29 33 Recently offered issues 8.49 8.19 8.97 8.86 9. 13 9.27 9.41 r9. 28 9. 31 9.35 9.54 9.51 Dividend/price ratio 34 Preferred stocks 7.97 7.60 8., 25 8.24 8. 29 8.43 8.84 8.41 8. 69 8.79 8.94 8.92 35 Common stocks 3.77 4.56 5., 28 4.97 5. 11 5.45 5.39 5. 49 5. 28 5.39 5.50 5.39 1 Weekly figures are 7-day averages of daily effective rates for the week 9 Except for new bill issues, yields are computed from daily closing ending Wednesday; the daily effective rate is an average of the rates on bid prices. a given day weighted by the volume of transactions at these rates. !0 Rates are recorded in the week in which bills are issued. 2 Beginning Nov. 1977, unweighted average of offering rates quoted 11 Yields on the more actively traded issues adjusted to constant by five dealers. Previously, most representative rate quoted by those maturities by the U.S. Treasury, based on daily closing bid prices. dealers. 12 Unweighted averages for all outstanding notes and bonds in maturity 3 Yields are quoted on a bank-discount basis. ranges shown, based on daily closing bid prices. "Long-term" includes 4 Averages of the most representative daily offering rates published by all bonds neither due nor callable in less than 10 years, including a numfinance companies for varying maturities in this range. ber of very low yielding "flower" bonds. 5 Average of the midpoint of the range of daily dealer closing rates 13 General obligations only, based on figures for Thursday, from offered for domestic issues. Moody's Investors Service. 6 Weekly figures (week ending Wednesday) are 7-day averages of the 14 Twenty issues of mixed quality. daily midpoints as determined from the range of offering rates; monthly 15 Averages of daily figures from Moody's Investors Service. figures are averages of total days in the month. Beginning Apr. 5, 1978, 16 Compilation of the Board of Governors of the Federal Reserve weekly figures are simple averages of offering rates. System. 7 Posted rates, which are the annual interest rates most often quoted Issues included are long-term (20 years or more). New-issue yields on new offerings of negotiable CD's in denominations of $100,000 or are based on quotations on date of offering; those on recently offered more by large New York City banks. Rates prior to 1976 not available. issues (included only for first 4 weeks after termination of underwriter Weekly figures are for Wednesday dates. price restrictions), on Friday close-of-business quotations. 8 Averages of daily quotations for the week ending Wednesday. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A28 Domestic NonfinancialS tatistics • January 1979 1.37 STOCK MARKET Selected Statistics 1978 Indicator 1975 1976 1977 June July Aug. Sept. Oct. Nov. Dec. Prices and trading (averages of daily figures) Common stock prices 1 New York Stock Exchange (Dec. 31,1965 = 50). 45.73 54.45 53.67 54.83 54.61 58.53 58.58 56.40 52.74 53.69 2 Industrial 51.88 60.44 57.84 59.63 59.35 64.07 64.23 61.60 57.50 58.72 3 Transportation 30.73 39.57 41.07 44.19 44.74 49.45 50.19 46.70 41.80 42.49 4 Utility 31.45 36.97 40.91 39.41 39.28 40.20 39.82 39.44 37.88 38.09 5 Finance 46.62 52.94 55.23 58.31 57.97 63.28 63.22 60.42 54.95 55.73 6 Standard & Poor's Corporation (1941-43 = 10) i.. 85.17 102.01 98.18 97.66 97.19 103.92 103.86 100.58 94.71 96.10 7 American Stock Exchange (Aug. 31,1973 = 100). 83.15 101.63 116.18 147.64 149.87 162.52 170.95 160.14 144.17 149.94 Volume of trading (thousands of shares)2 8 New York Stock Exchange 18,568 21,189 20,936 30,514 27,074 37,603 33,612 31,020 24,505 24,622 9 American Stock Exchange 2,150 2,565 2,514 4,220 3,496 5,526 5,740 4,544 3,304 3,430 Customer financing (end-of-period balances, in millions of dollars) 10 Regulated margin credit at brokers/dealers 5,540 8,166 9,993 11,332 11,438 11,984 12,626 12,307 11,209 11 Margin stock4 5,390 7,960 9,740 11,090 11,190 11,740 12,400 12,090 11,000 12 Convertible bonds 147 204 250 242 247 243 225 216 209 13 Subscription issues 3 2 3 1 1 1 MEMO: Free credit balances at brokers® 14 Margin-account 475 585 640 700 710 795 825 r885 790 15 Cash-account 1,525 1,855 2,060 2,300 2,295 2,555 2,655 r2,465 2,300 Margin-account debt at brokers (percentage distribution, end of period) 16 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 By equity class (in per cent): 17 Under 40 24.0 12.0 18.0 16.0 13.0 12.0 15.0 47.0 32.0 18 40-49 28.8 23.0 36.0 34.0 34.0 34.0 36.0 20.0 27.0 19 50-59 22.3 35.0 23.0 26.0 25.0 23.0 23.0 15.0 20.0 20 60-69 11.6 15.0 11.0 12.0 14.0 16.0 13.0 8.0 10.0 21 70-79 6.9 8.7 6.0 7.0 8.0 9.0 7.0 5.0 6.0 22 80 or more 5.3 6.0 5.0 5.0 6.0 6.0 6.0 5.0 5.0 Special miscellaneous-account balances at brokers (end of period) 23 Total balances (millions of dollars)8 77777,,,,,222229999900000 88888,,,,,777777777766666 99999,,,,,999991111100000 Distribution by equity status (per cent) 24 Net credit status 4444433333.....88888 4444411111.....33333 4444433333.....44444 Debit status, equity of— 25 60 per cent or more 4444400000.....88888 4444477777.....88888 4444444444.....99999 26 Less than 60 per cent 1111155555.....44444 1111100000.....99999 1111111111.....77777 1 Effective July 1976, includes a new financial group, banks and in- 5 Nonmargin stocks are those not listed on a national securities exsurance companies. With this change the index includes 400 industrial change and not included on the Federal Reserve System's list of over-thestocks (formerly 425), 20 transportation (formerly 15 rail), 40 public counter margin stocks. At brokers, such stocks have no loan value. utility (formerly 60), and 40 financial. 6 Free credit balances are in accounts with no unfulfilled commitments 2 Based on trading for a 5Vi-hour day. to the brokers and are subject to withdrawal by customers on demand. 3 Margin credit includes all credit extended to purchase or carry 7 Each customer's equity in his collateral (market value of collateral stocks or related equity instruments and secured at least in part by stock. less net debit balance) is expressed as a percentage of current collateral Credit extended is end-of-month data for member firms of the New York values. Stock Exchange. 8 Balances that may be used by customers as the margin deposit re- In addition to assigning a current loan value to margin stock generally, quired for additional purchases. Balances may arise as transfers based Regulations T and U permit special loan values for convertible bonds on loan values of other collateral in the customer's margin account or and stock acquired through exercise of subscription rights. deposits of cash (usually sales proceeds) occur. 4 A distribution of this total by equity class is shown on lines 23-28. NOTE.—For table on "Margin Requirements" see p. A-10, Table 1.161. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Thrift Institutions A29 1.38 SAVINGS INSTITUTIONS Selected Assets and Liabilities Millions of dollars, end of period 1978 11997755 11997766 11997777 AAAccccccooouuunnnttt Mar. Apr. May June July Aug. Sept. Oct. Nov. Savings and loan associations9 1 Assets 338,233 391,907 459,241 475,281 480,947 487,052 491,576 498,301 504,298 508,977 515,352 520,420 2 Mortgages 278,590 323,005 381,163 392,428 397,284 402,305 407,965 411,956 416,677 420,971 425,236 429,316 3 Cash and investment 30,853 35,724 39,150 41,823 41,853 42,444 41,505 43,627 44,188 43,987 45,577 4455,,776611 4 Other 28,790 33,178 38,928 41,030 41,810 42,303 42,106 42,718 43,433 44,019 44,539 45,343 5 Liabilities and net worth 338,233 391,907 459,241 475,281 480,947 487,052 491,576 498,301 504,298 508,977 515,352 520,420 285,743 335,912 386,800 398,992 399,550 401,930 408,586 411,660 AU,912 420,405 423,050 425,107 7 Borrowed money 20,634 19,083 27,840 29,323 31,904 32,759 34,270 35,730 37,219 38,595 39,873 40,862 8 FHLBB 17,524 15,708 19,945 21,030 22,692 23,323 24,875 26,151 27,363 28,632 29,456 30,290 9 Other 3,110 3,375 7,895 8,293 9,212 9,436 9,395 9,579 9,856 9,963 10,417 10,572 10 Loans in process 5,128 6,840 9,911 10,414 10,937 11,386 11,632 11,540 11,422 11,222 11,165 10,483 11 Other 6,949 8,074 9,506 10,518 12,186 14,239 10,046 11,972 13,906 10,676 12,832 14,648 12 Net worth2 19,779 21,998 25,184 26,034 26,370 26,738 27,042 27,399 27,779 28,079 28,432 28,820 13 MEMO : Mortgage loan commitments outstanding3.. 10,673 14,826 19,875 22,308 23,398 23,939 22,927 2222,,339933 2222,,004477 2211,,664488 21,503 26,017 Mutual savings banks10 14 Assets. 121,056 134,812 147,287 150,962 151,383 152,202 153,175 154,315 155,210 156,110 156,843 Loans: 15 Mortgage 77,221 81,630 88,195 89,800 90,346 90,915 91,555 92,230 92,866 93,403 93,903 16 Other 4,023 5,183 6,210 7,782 7,422 7,907 7,771 8,207 8,379 8,418 8,272 Securities: 17 U.S. Government 4,740 5,840 5,895 5,677 5,670 5,491 5,304 5,269 5,210 5,172 5,105 18 State and local go veri 1,545 2,417 2,828 2,850 2,915 2,994 3,008 3,025 3,098 3,180 3,190 19 Corporate and other4 27,992 33,793 37,918 38,964 39,146 39,225 39,427 39,639 39,592 39,639 39,651 20 Cash 2,330 2,355 2,401 1,990 1,940 1,798 2,163 2,029 2,080 2,293 2,735 21 Other assets 3,205 3,593 3,839 3,899 3,945 3,873 3,946 3,915 3,985 4,006 3,988 22 Liabilities. 121,056 134,812 147,287 150,962 151,383 152,202 153,175 154,315 155,210 156,110 156,843 23 Deposits 109,873 122,877 134,017 136,997 136,931 137,307 138,709 139,128 139,308 140,816 141,026 24 Regular:5 109,291 121,961 132,744 135,558 135,349 135,785 137,089 137,430 137,690 139,068 139,422 25 Ordinary savings.. 69,653 74,535 78,005 78,783 78,170 78,273 77,321 76,116 75,578 75,423 74,124 26 Time and other... 39,639 47,426 54,739 56,775 57,179 57,512 59,768 61,313 62,112 63,645 65,298 27 Other 582 916 1,272 1,439 1,582 1,521 1,620 1,698 1,619 1,747 1,604 28 Other liabilities 2,755 2,884 3,292 3,735 4,152 4,481 3,969 4,636 5,246 4,570 5,040 29 General reserve accounts 8,428 9,052 9,978 10,230 10,301 10,414 10,497 10,551 10,654 10,725 10,777 30 MEMO: Mortgage loan commitments outstanding®.. 1,803 2,439 4,066 4,185 4,342 4,606 4,958 4,872 4,789 4,561 4,843 Life insurance companies11 31 Assets 289,304 321,552 351,722 359,110 363,269 366,938 369,879 374,415 378,124 381,050 382,446 Securities: 32 Government 13,758 17,942 19,553 19,573 19,330 19,489 19,401 19,447 19,563 19,638 19,757 33 United States7 4,736 5,368 5,315 5,229 5,087 5,206 4,984 5,006 5,155 5,156 5,183 34 State and local 4,508 5,594 6,051 6,041 5,923 5,915 5,943 5,925 5,884 6,001 6,035 35 Foreign8 4,514 6,980 8,187 8,303 8,320 8,368 8,474 8,516 8,524 8,481 8,539 36 Business 135,317 157,246 175,654 181,441 184,917 187,126 188,500 192,112 194,620 196,152 195,883 37 Bonds 107,256 122,984 141,891 148,849 150,419 152,267 153,812 156,207 157,888 159,972 161,347 38 Stocks 28,061 34,262 33,763 32,592 34,498 34,859 34,688 35,905 36,732 36,180 34,536 39 Mortgages 89,167 91,552 96,848 98,022 98,585 99,190 100,040 100,596 101,602 102,365 103,161 40 Real estate 9,621 10,476 11,060 11,213 11,269 11,537 11,540 11,562 11,538 11,583 11,693 41 Policy loans 24,467 25,834 27,556 28,024 28,246 28,431 28,649 28,843 29,067 29,290 29,521 42 Other assets 16,971 18,502 21,051 20,837 20,922 21,165 21,749 21,855 21,734 22,022 22,431 Credit unions 43 Total assets/liabilities and capital 38,037 45,225 54,084 56,703 56,827 58,018 59,381 59,152 60,141 61,277 60,909 61,465 44 Federal 20,209 24,396 29,574 31,274 31,255 31,925 32,793 32,679 33,315 34,058 33,718 34,093 45 State 17,828 20,829 24,510 25,429 25,572 26,093 26,588 26,473 26,826 27,219 27,191 27,372 46 Loans outstanding 28,169 34,384 42,055 43,379 44,133 45,506 47,118 47,620 49,103 50,121 50,549 51,264 47 Federal 14,869 18,311 22,717 23,555 23,919 24,732 25,762 25,970 26,840 27,510 27,697 28,176 48 State 13,300 16,073 19,338 19,824 20,214 20,11A 21,356 21,650 22,263 22,611 22,852 23,088 49 Savings 33,013 39,173 46,832 49,706 49,931 50,789 52,076 51,551 51,772 52,867 52,468 52,600 50 Federal (shares) 17,530 21,130 25,849 27,514 27,592 28,128 28,903 28,627 28,779 29,429 29,086 29,163 51 State (shares and deposits). 15,483 18,043 20,983 22,192 22,339 22,661 23,173 22,924 22,993 23,438 23,382 23,437 For notes see bottom of page A30. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A30 Domestic NonfinancialS tatistics • January 1979 1.39 FEDERAL FISCAL AND FINANCING OPERATIONS Millions of dollars Calendar year TTTrrraaannnsssiiitttiiiooonnn qqquuuaaarrrttteeerrr FFFiiissscccaaalll FFFiiissscccaaalll TTTyyypppeee ooofff aaaccccccooouuunnnttt ooorrr ooopppeeerrraaatttiiiooonnn (((JJJuuulllyyy--- yyyeeeaaarrr yyyeeeaaarrr 1977 1978 1978 SSSeeepppttt... 111999777777 111999777888 111999777666))) HI H2 HI Sept. Oct. Nov. U.S. Budget 1 Receipts1 81,772 357,762 401,997 190,278 175,820 210,650 42,591 28,745 33,227 2 Outlays i 94,742 402,803 450,758 200,350 216,781 222,518 38,935 42,691 39,134 3 Surplus, or deficit ( — ) -12,970 -45,041 -48,761 -10,072 -40,961 -11,870 3,655 -13,946 -5,907 4 Trust funds -1,952 7.833 12,693 7,332 4,293 4,334 5,922 1,626 1,293 5 Federal funds 2 -11,018 -52,874 -61,454 -17,405 -45,254 -16,204 -2,267 -15,572 -7,200 Off-budget entities surplus, or deficit (-) 6 Federal Financing Bank outlays... -2,575 -8,415 -10,660 -2,075 -6,663 -5,105 -753 -975 -296 7 Other 3 793 -269 354 -2,086 428 -790 -29 171 1,700 U.S. Budget plus off-budget, including Federal Financing Bank 8 Surplus, or deficit ( —) -14,752 -53,725 -59,067 -14,233 -47,196 -17,765 -2,873 --1144,,775500 --44,,550033 Financed by: 9 Borrowing from the public 18,027 53,516 59,106 16,480 40,284 23,374 2,821 66,,448844 55,,223366 10 Cash and monetary assets (decrease, or increase (—)) -2,899 -2,238 -3,023 -4,666 4,317 -5,098 -9,731 7,082 3,485 11 Other 4 -373 2,440 2,984 2,420 2,597 -511 9,783 1,184 -4,218 MEMO ITEMS : 12 Treasury operating balance (level, end of period) 17,418 19,104 22,444 16,255 12,274 17,526 22,444 15,545 16,291 13 Federal Reserve Banks 13,299 15,740 16,647 15,183 7,114 11,614 16,647 15,467 4,196 14 Tax and loan accounts 4,119 3,364 5,797 1.072 5,160 5,912 5,797 78 12,095 1 Effective June 1978, earned income credit payments in excess of 4 Includes public debt accrued interest payable to the public; deposit an individual's tax liability, formerly treated as income tax refunds, are funds; miscellaneous liability (including checks outstanding) and asset classified as outlays retroactive to January 1976. accounts; seignorage; increment on gold; net gain/loss for U.S. currency 2 Half years calculated as a residual of total surplus/deficit and trust valuation adjustment; net gain/loss for IMF valuation adjustment. fund surplus/deficit. 3 Includes Pension Benefit Guaranty Corp.; Postal Service Fund; Rural SOURCE.—"Monthly Treasury Statement of Receipts and Outlays of Electrification and Telephone Revolving Fund, Rural Telephone Bank; the U.S. Government," Treasury Bulletin, and U.S. Budget, Fiscal Year and Housing for the Elderly or Handicapped Fund until October 1977. 1978. NOTES TO TABLE 1.38 1 Holdings of stock of the Federal home loan banks are included in NOTE.—Savings and loan associations: Estimates by the FHLBB for "other assets." all associations in the United States. Data are based on monthly reports 2 Includes net undistributed income, which is accrued by most, but not of Federally insured associations and annual reports of other associations. all, associations. Even when revised, data for current and preceding year are subject to 3 Excludes figures for loans in process, which are shown as a liability. further revision. 4 Includes securities of foreign governments and international organiza- Mutual savings banks: Estimates of National Association of Mutual tions and nonguaranteed issues of U.S. Government agencies. Savings Banks for all savings banks in the United States. Data are re- 5 Excludes checking, club, and school accounts. ported on a gross-of-valuation-reserves basis. 6 Commitments outstanding (including loans in process) of banks in Life insurance companies: Estimates of the American Council of Life New York State as reported to the Savings Banks Association of the Insurance for all life insurance companies in the United States. Annual State of New York. figures are annual-statement asset values, with bonds carried on an 7 Direct and guaranteed obligations. Excludes Federal agency issues amortized basis and stocks at year-end market value. Adjustments for not guaranteed, which are shown in this table under "business" securities. interest due and accrued and for differences between market and book 8 Issues of foreign governments and their subdivisions and bonds of the values are not made on each item separately but are included, in total, in International Bank for Reconstruction and Development. "other assets." 9 Data reflect benchmark revisions back to 1977. Credit unions: Estimates by the National Credit Union Administration 10 Data for June, July, and August 1978 have been revised. for a group of Federal and State-chartered credit unions that account for 11 Data for 1977 and the first 6 months of 1978 have been revised by about 30 per cent of credit union assets. Figures are preliminary and the American Council of Life Insurance. revised annually to incorporate recent benchmark data. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A31 1.40 U.S. BUDGET RECEIPTS AND OUTLAYS Millions of dollars Calendar year Transition quarter Fiscal Source or type (July- year year 1977 1978 1978 Sept. 1977 1978 1976) HI H2 HI Sept. Oct. Nov. Receipts 1 All sources1 81,772 357,762 401,997 190,278 175,820 210,650 42,591 28,745 33,227 2 Individual income taxes, net 38,800 157,626 180,988 78,816 82,911 90,336 20,883 15,922 16,609 3 Withheld 32,949 144,820 165,215 73,303 75,480 82,784 14,843 15,032 16,268 4 Presidential Election Campaign Fund 1 37 39 37 1 36 5 Nonwithheld 6,809 42,062 47,804 32,959 9,397 37,584 6,354 1,104 533 6 Refunds i 958 29,293 32,070 27,482 1,967 30,068 314 214 192 7 Corporation income taxes: 8 Gross receipts 9,808 60,057 65,380 37,133 25,121 38,496 10,153 2,436 1,541 9 Refunds 1,348 5,164 5,428 2,324 2,819 2,782 400 752 493 10 Social insurance taxes and contributions, net 25,760 108,683 123,410 58,099 52,347 66,191 8,515 7,805 11,923 11 Payroll employment taxes and contributions 2 21,534 88,196 99,626 45,242 44,384 51,668 7,485 6,595 9,762 12 Self-employment taxes and contributions 3 269 44,,001144 44,,226677 33,,668877 316 3,892 369 13 Unemployment insurance 2,698 1111,,331122 1133,,885500 66,,557755 4,936 7,800 162 722 1,662 14 Other net receipts 4 1,259 55,,116622 55,,666688 22,,559955 2,711 2,831 499 488 499 15 Excise taxes 4,473 17,548 18,376 8,432 9,284 8,835 1,637 1,635 1,712 16 Customs deposits 1,212 5,150 6,573 2,519 2,8^8 3,320 610 621 646 17 Estate and gift taxes 1,455 7,327 5,285 4,332 2,837 2,587 445 477 460 18 Miscellaneous receipts 5 1,612 6,536 7,413 3,269 3,292 3,667 747 602 829 Outlays 8 19 All types 1 94,742 402,803 450,758 200,350 216,781 222,518 38,935 42,691 39,134 20 National defense 22,307 97,501 105,192 48,721 50,873 52,979 9,006 9,197 9,239 21 International affairs 2,180 4,831 6,083 2,522 2,896 2,904 387 324 -47 22 General science, space, and technology 1,161 444,,,666777777 444,,,777222111 2,108 2,318 222,,,333999555 444000333 333666777 444111222 23 Energy 794 444,,,111777222 666,,,000444555 222,,,444888777 999333333 888222111 777999222 24 Natural resources and environment. 22,,553322 111000,,,000000000 111111,,,000222222 444,,,999555999 111,,,333999111 888777888 888888999 25 Agriculture 558844 555,,,555222666 777,,,666111888 2,628 5,477 222,,,333555333 222888333 999444999 111,,,333777222 26 Commerce and housing credit 111,,,333999111 -31 333,,,333444000 —946 444666777 222,,,111222444 444111 27 Transportation 333,,,333000666 1144,,663366 111555,,,444666111 77,,772233 111,,,555777222 111,,,666999555 111,,,444111444 28 Community and regional development 111,,,333444000 66,,228833 111111,,,222555555 3,149 4,924 55,,992288 111,,,444333999 999222999 999111000 29 Education, training, employment, and social services 5,162 20,985 25,889 9,775 10,800 12,792 2,263 2,144 2,244 30 Health 8,720 38,785 44,529 18,654 19,422 21,391 3,595 4,037 3,957 31 Income security1 32,795 137,905 145,640 70,785 71,081 75,201 12,756 11,815 12,358 32 Veterans benefits and services 3,962 18,038 18,987 9,382 9,864 9,603 1,442 1,647 1,667 33 Administration of justice 859 3.600 3,786 1,783 1,723 1,946 324 328 392 34 General government 878 3,357 3,544 1,587 1,749 1,803 335 785 196 35 General-purpose fiscal assistance.... 2,092 9,499 9,377 4,333 4,926 4,665 127 2,019 160 36 Interest 6 7,246 38,092 44,040 18,927 19,962 22,280 3,306 3,030 3,850 37 Undistributed offsetting receipts 6-7 -2,567 -15,053 -15,772 -6,803 -8,506 -7,945 -1,089 -397 -713 1 Effective June 1978, earned income credit payments in excess of an 7 Consists of interest received by trust funds, rents and royalties on individual's tax liability, formerly treated as income tax refunds, are the Outer Continental Shelf, and U.S. Government contributions for classified as outlays retroactive to January 1976. employee retirement. 2 Old-age, disability and hospital insurance, and Railroad Retirement 8 For some types of outlays the categories are new or represent reaccounts. groupings; data for these categories are from the Budget of the United 3 Old-age, disability, and hospital insurance. States Government, Fiscal Year 1979; data are not available for half years 4 Supplementary medical insurance premiums, Federal employee re- or for months prior to February 1978. tirement contributions, and Civil Service retirement and disability fund. Two categories have been renamed: "Law enforcement and justice" 5 Deposits of earnings by Federal Reserve Banks and other miscel- has become "Administration of justice" and "Revenue sharing and laneous receipts. general purpose fiscal assistance" has become "General purpose fiscal 6 Effective September 1976, "Interest" and "Undistributed Offsetting assistance." Receipts" reflect the accounting conversion for the interest on special In addition, for some categories the table includes revisions in figures issues for U.S. Government accounts from an accrual basis to a cash basis. published earlier. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A32 DomesticN onfinancial Statistics • January 1979 1.41 FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION Billions of dollars 1976 1977 1978 IItteemm June 30 Sept. 30 Dec. 31 June 30 Sept. 30 Dec. 31 Mar. 31 June 20 Sept. 30 1 Federal debt outstanding 631.9 2 646.4 665.5 685.2 709.1 729.2 747.8 758.8 780.4 2 Public debt securities 620.4 634.7 653.5 674.4 698.8 718.9 738.0 749.0 771.5 33 HHeelldd bbyy ppuubblliicc 470.8 488.6 506.4 523.2 543.4 564.1 585.2 587.9 603.6 44 HHeelldd bbyy aaggeenncciieess 149.6 146.1 147.1 151.2 155.5 154.8 152.7 161.1 168.0 11.5 11.6 12.0 10.8 10.3 10.2 9.9 9.8 8.9 6 Held by public 9.5 29.7 10.0 9.0 8.5 8.4 8.1 8.0 1.4 7 Held by agencies 2.0 1.9 1.9 1.8 1.8 1.8 1.8 1.8 1.5 8 Debt subject to statutory limit 621.6 635.8 654.7 675.6 700.0 720.1 739.1 750.2 772.7 9 Public debt securities 619.8 634.1 652.9 673.8 698.2 718.3 737.3 748.4 770.9 10 Other debt i 1.7 1.7 1.7 1.7 1.7 1.7 1.8 1.8 1.8 11 MEMO: Statutory debt limit 636.0 636.0 682.0 700.0 700.0 752.0 752.0 752.0 798.0 1 Includes guaranteed debt of Govt, agencies, specified participation $0.5 billion due to a retroactive reclassification of the Export-Import Bank certificates, notes to international lending organizations, and District of certificates of beneficial interest from loan asset sales to debt, effective Columbia stadium bonds. July 1, 1975. 2 Gross Federal debt and agency debt held by the public increased NOTE.—Data from Treasury Bulletin (U.S. Treasury Dept.). 1.42 GROSS PUBLIC DEBT OF U.S. TREASURY Types and Ownership Billions of dollars, end of period 1978 Type and holder 1974 1975 1976 1977 Aug. Sept. Oct. Nov. Dec. 1 Total gross public debt 492.7 576.6 653.5 718.9 764.4 771.5 776.4 783.0 789.2 By type: 2 Interest-bearing debt 491.6 575.7 652.5 715.2 763.4 767.0 775.5 782.0 782.4 3 Marketable 282.9 363.2 421.3 459.9 485.6 485.2 491.7 493.3 487.5 4 Bills 119.7 157.5 164.0 161.1 160.6 160.9 161.2 161.5 161.7 5 Notes 129.8 167.1 216.7 251.8 268.5 267.9 272.6 271.7 265.8 6 Bonds 33.4 38.6 40.6 47.0 56.4 56.4 57.8 60.1 60.0 7 Nonmarketable1 208.7 212.5 231.2 255.3 227.8 281.8 283.8 288.7 294.8 8 Convertible bonds2 2.3 2.3 2.3 2.2 2.2 2.2 2.2 2.2 2.2 9 State and local government series .6 1.2 4.5 13.9 24.2 24.2 24.1 24.1 24.3 10 Foreign issues3 22.8 21.6 22.3 22.2 22.2 21.7 24.0 26.6 28.0 11 Savings bonds and notes 63.8 67.9 72.3 77.0 79.9 80.2 80.5 80.7 80.9 12 Government account series4 119.1 119.4 129.7 139.8 149.0 153.3 152.7 154.8 157.5 13 Non-interest-bearing debt... 1.1 1.0 1.1 3.7 1.0 4.6 1.0 6.8 By holder.-5 14 U.S. Government agencies and trust funds 138.2 139.1 147.1 154.8 163.7 168.0 166.3 15 Federal Reserve Banks 80.5 89.8 97.0 102.5 111.7 114.8 115.3 16 Private investors 271.0 349.4 409.5 461.3 489.0 488.3 494.7 17 Commercial banks 55.6 85.1 103.8 101.4 95.8 95.3 94.3 18 Mutual savings banks 2.5 4.5 5.9 5.9 5.5 5.4 5.4 19 Insurance companies 6.2 9.5 12.7 15.1 15.1 15.1 15.3 20 Other corporations 11.0 20.2 27.7 22.7 22.4 21.5 21.0 21 State and local governments 29.2 34.2 41.6 55.2 69.2 67.8 67.1 Individuals: 22 Savings bonds 63.4 67.3 72.0 76.7 79.7 79.8 80.2 23 Other securities 21.5 24.0 28.8 28.6 29.2 29.4 29.6 24 Foreign and international 6 58.8 66.5 78.1 109.6 121.2 121.0 122.5 25 Other miscellaneous investors7 22.8 38.0 38.9 46.1 50.9 52.9 54.3 1 Includes (not shown separately): Securities issued to the Rural 6 Consists of the investments of foreign balances and international Electrification Administration and to State and local governments, de- accounts in the United States. Beginning with July 1974, the figures exclude positary bonds, retirement plan bonds, and individual retirement bonds. non-interest-bearing notes issued to the International Monetary Fund. 2 These nonmarketable bonds, also known as Investment Series B 7 Includes savings and loan associations, nonprofit institutions, cor- Bonds, may be exchanged (or converted) at the owner's option for 1 Vi porate pension trust funds, dealers and brokers, certain Govt, deposit per cent, 5-year marketable Treasury notes. Convertible bonds that have accounts, and Govt.-sponsored agencies. been so exchanged are removed from this category and recorded in the notes category above. NOTE.—Gross public debt excludes guaranteed agency securities and, 3 Nonmarketable foreign government dollar-denominated and foreign beginning in July 1974, includes Federal Financing Bank security issues. currency denominated series. Data by type of security from Monthly Statement of the Public Debt of 4 Held almost entirely by U.S. Govt, agencies and trust funds. the United States (U.S. Treasury Dept.); data by holder from Treasury 5 Data for F.R. Banks and U.S. Govt, agencies and trust funds are Bulletin. actual holdings; data for other groups are Treasury estimates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A33 1.43 U.S. GOVERNMENT MARKETABLE SECURITIES Ownership, by maturity Par value; millions of dollars, end of period 1978 1978 Type of holder 11997766 11997777 1976 1977 Sept. Oct. Sept. Oct. All maturities 1 to 5 years 1 All holders 421,276 459,927 485,155 491,651 141,132 151,264 168,474 171,802 2 U.S. government agencies and trust funds 16,485 14,420 13,886 13,885 6,141 4,788 3,705 3,705 3 Federal Reserve Banks 96,971 101,191 114,769 115,322 31,249 27,012 31,775 32,033 4 Private investors 307,820 344,315 356,501 362,443 103,742 119,464 132,993 136,064 5 Commercial banks 78,262 75,363 70,706 69,906 40,005 38,691 40,733 40,841 6 Mutual savings banks 4,072 4,379 3,740 3,744 2,010 2,112 2,062 2,080 7 Insurance companies 10,284 12,378 11,805 11,994 3,885 4,729 4,991 4,981 8 Nonfinancial corporations 14,193 9,474 9,092 8,791 2,618 3,183 4,793 4,522 9 Savings and loan associations 4,576 4,817 4,369 4,312 2,360 2,368 2,441 2,546 10 State and local governments 12,252 15,495 18,075 17,594 2,543 3,875 4,494 4,316 11 All others 184,182 222,409 238,714 246,102 50,321 64,505 73,479 76,777 Total, within 1 year 5 to 10 years 12 All holders 211,035 230,691 225,396 227,101 43,045 45,328 49,273 49,271 13 U.S. government agencies and trust funds 2,012 1,906 2,281 2,281 2,879 2,129 1,987 1,987 14 Federal Reserve Banks 51,569 56,702 59,296 59,483 9,148 10,404 13,786 13,807 15 Private investors 157,454 172,084 163,819 165,337 31,018 32,795 33,500 33,476 16 Commercial banks 31,213 29,All 20,007 19,116 6,278 6,162 7,423 7,354 17 Mutual savings banks 1,214 1,400 880 845 567 584 539 543 18 Insurance companies 2,191 2,398 1,685 1,788 2,546 3,204 2,931 2,970 19 Nonfinancial corporations 11,009 5,770 3,655 3,725 370 307 311 361 20 Savings and loan associations 1,984 2,236 1,726 1,563 155 143 129 131 21 State and local governments 6,622 7,917 7,699 7,202 1,465 1,283 1,519 1,595 22 All others 103,220 122,885 128,167 131,097 19,637 21,112 20,648 20,521 Bills, within 1 year 10 to 20 years 23 AU holders 163,992 161,081 160,936 161,227 11,865 12,906 16,573 18,052 24 U.S. government agencies and trust funds 449 32 2 3,102 3,102 3,273 3,273 25 Federal Reserve Banks 41,279 42,004 48,160 48,450 1,363 1,510 1,917 2,033 26 Private investors 122,264 119,035 112,775 112,775 7,400 8,295 11,383 12,746 27 Commercial banks 17,303 11,996 5,862 4,545 339 456 1,060 1,212 28 Mutual savings banks 454 484 199 195 139 137 132 151 29 Insurance companies 1,463 1,187 750 818 1,114 1,245 1,304 1,354 30 Nonfinancial corporations 9,939 4,329 1,657 1,358 142 133 162 132 31 Savings and loan associations 1,266 806 373 290 64 54 56 55 32 State and local governments 5,556 6,092 5,280 4,774 718 890 1,080 1,133 33 All others 86,282 94,152 98,654 100,796 4,884 5,380 7,590 8,702 Other, within 1 year Over 20 years 34 AH holders 47,043 69,610 64,460 65,874 14,200 19,738 25,439 25,425 35 U.S. government agencies and trust funds 1,563 1,874 2,280 2,279 2,350 2,495 2,640 2,639 36 Federal Reserve Banks 10,290 14,698 11,136 11,033 3,642 5,564 7,994 7,966 37 Private investors 35,190 53,039 51,044 52,561 8,208 11,679 14,805 14,820 38 Commercial banks 13,910 15,482 14,145 14,571 427 578 1,483 1,383 39 Mutual savings banks 760 916 681 650 143 146 128 118 40 Insurance companies 728 1,211 934 970 548 802 894 900 41 Nonfinancial corporations 1,070 1,441 1,998 2,368 55 81 171 51 42 Savings and loan associations 718 1,430 1,353 1,273 13 16 18 17 43 State and local governments 1,066 rl,825 2,419 2,428 904 1,530 3,282 3,347 44 All others 16,938 28,733 29,513 30,301 6,120 8,526 8,830 9,003 NOTE.—Direct public issues only. Based on Treasury Survey of Owner- 464 mutual savings banks, and 728 insurance companies, each about 80 ship from Treasury Bulletin (U.S. Treasury Dept.). per cent; (2) 435 nonfinancial corporations and 485 savings and loan Data complete for U.S. govt, agencies and trust funds and F.R. Banks, associations, each about 50 per cent; and (3) 493 State and local governbut data for other groups include only holdings of those institutions ments, about 40 per cent. that report. The following figures show, for each category, the number "All others," a residual, includes holdings of all those not reporting and proportion reporting as of Oct. 31, 1978: (1) 5,465 commercial banks in the Treasury Survey, including investor groups not listed separately. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A34 Domestic Financial Statistics • January 1979 1.44 U.S. GOVERNMENT SECURITIES DEALERS Transactions Par value; averages of daily figures, in millions of dollars 1978 1978, week ending Wednesday— IItteemm 11997755 11997766 11997777 Sept. Oct. Nov. Oct. 11 Oct. 18 Oct. 25 Nov. 1 Nov. 8 Nov. 15 1 U.S. government securities.. 6,027 10,449 10,838 9,526 r9,817 11,844 9,347 10,244 9,989 12,220 12,871 13,354 By maturity: 2 Bills 3,889 6,676 6,746 5,552 '6,289 6,573 6,271 7,182 6,540 6,149 6,075 7,661 3 Other within 1 year 223 210 237 315 420 449 336 292 372 661 333 577 4 1-5 years 1,414 2,317 r2,320 1,863 1,520 2,301 1,233 1,234 1,545 3,265 2,508 2,081 5 5-10 years 363 1,019 1,148 802 691 1,207 640 690 618 991 1,709 1,518 6 Over 10 years 138 229 388 994 897 1,314 866 846 914 1,153 2,246 1,517 By type of customer: 7 U.S. government securities dealers 885 1,360 1,267 921 983 908 1,132 965 1,019 911 949 1,045 8 U.S. government securities brokers 1,750 3,407 3,709 3,868 4,052 5,321 3,513 4,523 3,921 5,663 5,927 5,754 9 Commercial banks 1,451 2,426 2,295 1,473 1,404 1,834 1,255 1,432 1,342 1,962 1,920 2,115 10 All others i 1,941 3,257 r3,568 3,263 '3,377 3,780 3,446 3,325 3,706 3,684 4,075 4,440 11 Federal agency securities.... 1,043 1,548 '1,729 2,172 '2,029 2,208 1,715 2,532 1,663 2,777 2,123 2,514 1 Includes, among others, all other dealers and brokers in commodities Transactions are market purchases and sales of U.S. govt, securities and securities, foreign banking agencies, and the F.R. System. dealers reporting to the F.R. Bank of New York. The figures exclude allotments of, and exchanges for, new U.S. govt, securities, redemptions NOTE.—Averages for transactions are based on number of trading days of called or matured securities, or purchases or sales of securities under in the period. repurchase, reverse repurchase (resale), or similar contracts. 1.45 U.S. GOVERNMENT SECURITIES DEALERS Positions and Sources of Financing Par value; averages of daily figures, in millions of dollars 1978 1978, week ending Wednesday— IItteemm 11997755 11997766 11997777 Sept. Oct. Nov. Sept. 20 Sept. 27 Oct. 4 Oct. 11 Oct. 18 Oct. 25 Positions2 1 U.S. government securities.. 5,884 7,592 5,172 2,948 '1,424 2,417 3,906 1,490 1,920 1,282 1,232 1,217 2 Bills 4,297 6,290 4,772 2,824 '1,739 1,958 3,853 1,789 1,939 1,652 1,759 1,507 3 Other within 1 year 265 188 99 405 462 60 430 445 493 425 518 540 4 1-5 years 886 515 60 -320 -593 -228 -456 -480 -643 -695 -888 -660 5 5-10 years 300 402 92 11 -207 413 22 -194 -126 -153 -195 -247 6 Over 10 years 136 198 149 28 23 213 58 -70 258 53 38 78 7 Federal agency securities.... '939 729 693 977 234 217 1,161 800 577 387 204 82 Sources of financing3 8 All sources 6,666 8,715 9,877 11,558 10,430 11,396 12,814 10,122 9,734 10,337 10,426 10,275 Commercial banks: 9 New York City 1,621 1,896 1,313 997 385 347 1,213 626 696 463 234 460 10 Outside New York City... 1,466 1,660 1,987 2,344 2,105 2,032 2,904 2,069 1,816 2,164 2,278 1,811 11 Corporations1 842 1,479 '2,423 2,287 2,396 3,007 2,295 2,096 1,855 2,214 2,530 2,632 12 All others 2,738 3,681 '4,155 5,930 5,543 6,010 6,402 5,331 5,367 5,496 5,384 5,371 1 All business corporations except commercial banks and insurance firms and dealer departments of commercial banks against U.S. govt, companies. and Federal agency securities (through both collateral loans and sales 2 New amounts (in terms of par values) of securities owned by nonbank under agreements to repurchase), plus internal funds used by bank dealer dealer firms and dealer departments of commercial banks on a commit- departments to finance positions in such securities. Borrowings against ment, that is, trade-date basis, including any such securities that have securities held under agreement to resell are excluded where the borrowing been sold under agreements to repurchase. The maturities of some re- contract and the agreement to resell are equal in amount and maturity, purchase agreements are sufficiently long, however, to suggest that the that is, a matched agreement. securities involved are not available for trading purposes. Securities owned, and hence dealer positions, do not include securities purchased NOTE.—Averages for positions are based on number of trading days under agreements to resell. in the period; those for financing, on the number of calendar days in the 3 Total amounts outstanding of funds borrowed by nonbank dealer period. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Finance A35 1.46 FEDERAL AND FEDERALLY SPONSORED CREDIT AGENCIES Debt Outstanding Millions of dollars, end of period 1978 Agency 1975 1976 1977 May June July Aug. Sept. Oct. 1 Federal and Federally sponsored agencies 97,680 103,325 110,409 119,728 121,239 123,497 124,478 126,579 128,655 2 Federal agencies 19,046 21,896 23,245 23,864 23,983 24,145 23,686 24,321 24,466 3 Defense Department1 1,220 1,113 983 935 926 916 906 897 897 4 Export-Import Bank 2 •3 7,188 7,801 9,156 9,416 9,455 9,455 9,455 9,891 9,891 5 Federal Housing Administration4 564 575 581 608 606 603 603 601 598 6 Government National Mortgage Association participation certificates5 4,200 4,120 3,743 3,701 3,701 3,666 3,166 3,166 3,166 7 Postal Service 6 1,750 2,998 2,431 2,364 2,364 2,364 2,364 2,364 2,364 8 Tennessee Valley Authority 3,915 5,185 6,015 6,485 6,575 6,785 6,835 7,045 7,195 9 United States Railway Association6 209 104 336 355 356 356 357 357 355 10 Federally sponsored agencies 78,634 81,429 87,164 95,864 97.256 99,352 100,792 102,258 104,189 11 Federal home loan banks 18,900 16,811 18,345 22,217 22,306 23,430 24,360 25,025 25,395 12 Federal Home Loan Mortgage Corporation. 1,550 1,690 1,686 1,637 1,937 1,937 1,937 2,063 2,063 13 Federal National Mortgage Association 29,963 30,565 31,890 35,297 36,404 36,900 37,518 38,353 39,776 14 Federal land banks 15,000 17.127 19,118 19,686 19,686 20,198 20,198 20,198 20,360 15 Federal intermediate credit banks 9,254 10,494 11,174 11,081 11.257 11,392 11,482 11,555 11,554 16 Banks for cooperatives 3,655 4,330 4,434 5,264 4,974 4,788 4,570 4,317 4,264 17 Student Loan Marketing Association7 310 410 515 680 690 705 725 745 775 18 Other 2 2 2 2 2 2 2 2 2 MEMO ITEMS : 19 Federal Financing Bank debt6,8 17,154 28,711 38,580 43,871 44,504 45,550 46,668 48,078 49,212 Lending to Federal and Federally sponsored agencies : 20 Export-Import Bank3 4,595 5,208 5,834 6,094 6,132 6,132 6,132 6,568 6,568 21 Postal Service6 1,500 2,748 2,181 2,114 2,114 2,114 2,114 2,114 2,114 22 Student Loan Marketing Association7 310 410 515 680 690 705 725 745 775 23 Tennessee Valley Authority 1,840 3,110 4,190 4,660 4,750 4,960 5,010 5,220 5,370 24 United States Railway Association6 209 104 336 355 356 356 357 357 355 Other lending:9 25 Farmers Home Administration 7,000 10,750 16,095 20,090 20,910 21,580 22,275 22,275 23,050 26 Rural Electrification Administration 566 1,415 2,647 3,498 3,602 3,684 3,919 4,192 4,407 27 Other 1,134 4,966 6,782 6,380 5,950 6,019 6,136 6,607 6,573 1 Consists of mortgages assumed by the Defense Department between 7 Unlike other Federally sponsored agencies, the Student Loan 1957 and 1963 under family housing and homeowners assistance programs. Marketing Association may borrow from the Federal Financing Bank 2 Includes participation certificates reclassified as debt beginning (FFB) since its obligations are guaranteed by the Department of Health, Oct. 1, 1976. Education, and Welfare. 3 Off-budget Aug. 17,1974, through Sept. 30,1976; on-budget thereafter. 8 The FFB, which began operations in 1974, is authorized to purchase 4 Consists of debentures issued in payment of Federal Housing Ad- or sell obligations issued, sold, or guaranteed by other Federal agencies. ministration insurance claims. Once issued, these securities may be sold Since FFB incurs debt solely for the purpose of lending to other agencies, privately on the securities market. its debt is not included in the main portion of the table in order to avoid 5 Certificates of participation issued prior to fiscal 1969 by the Govern- double counting. ment National Mortgage Association acting as trustee for the Farmers 9 Includes FFB purchases of agency assets and guaranteed loans; Home Administration; Department of Health, Education, and Welfare; the latter contain loans guaranteed by numerous agencies with the Department of Housing and Urban Development; Small Business Ad- guarantees of any particular agency being generally small. The Farmers ministration; and the Veterans Administration. Home Administration item consists exclusively of agency assets, while the 6 Off-budget. Rural Electrification Administration entry contains both agency assets and guaranteed loans. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A36 Domestic Nonfinancial Statistics • January 1979 1.47 NEW SECURITY ISSUES of State and Local Governments Millions of dollars 1978 Type of issue or issuer, 1975 1976 1977 or use June July Aug. Sept.r Oct.r Nov. 1 All issues, new and refunding i 30,607 35,313 46,769 4,363 -3,912 r6,397 2,296 3,138 4,083 By type of issue: 2 General obligation 16,020 18,040 18,042 1,986 rl,065 r2,158 702 1,146 1,156 3 Revenue 14,511 17,140 28,655 2,369 r2,844 r4,230 1,587 1,979 2,919 4 Housing Assistance Administration 2 5 U.S. Government loans 76 133 72 8 3 9 7 13 8 By type of issuer: 6 7,438 7,054 6,354 912 650 919 85 551 341 7 Special district and statutory authority 12,441 15,304 21,717 1,461 2,168 3,106 1,566 1,577 2,702 8 Municipalities, counties, townships, school districts.... 10,660 12,845 18,623 1,981 rl,090 r2,363 636 996 1,031 9 Issues for new capital, total 29,495 32,108 36,189 r3,868 '3,487 '3,349 2,231 3,051 3,973 By use of proceeds: 10 Education 4,689 4,900 5,076 406 499 277 397 313 448 11 Transportation 2,208 2,586 2,951 r360 r292 632 302 422 258 12 7,209 9,594 8,119 819 942 686 693 827 1,218 13 4,392 6,566 8,274 698 rl,237 r959 501 1,151 725 14 Industrial aid 445 483 4,676 421 238 338 97 165 197 15 Other purposes 10,552 7,979 7,093 rl,164 279 457 241 173 1,127 1 Par amounts of long-term issues based on date of sale. SOURCE.—Public Securities Association. 2 Only bonds sold pursuant to the 1949 Housing Act, which are secured by contract requiring the Housing Assistance Administration to make annual contributions to the local authority. 1.48 NEW SECURITY ISSUES of Corporations Millions of dollars 1978 Type of issue or issuer, 1975 1976 1977 or use Mar. April May June July Aug. 1 AH issues 1 53,619 53,488 54,205 4,442 3,285 4,035 5,215 4,226 3,311 2 Bonds 42,756 42,380 42,193 3,620 2,811 2,996 3,810 3,718 2,529 By type of offering: 3 Public 32,583 26,453 24,186 1,902 ,958 1,719 1,744 2,177 1,497 4 Private placement 10,172 15,927 18,007 1,718 853 1,277 2,066 1,541 1,032 By industry group: 5 Manufacturing 16,980 13,264 12,510 1,155 534 837 1,105 675 485 6 Commercial and miscellaneous 2,750 4,372 5,887 428 421 314 562 417 414 7 Transportation 3,439 4,387 2,033 217 291 244 225 235 115 8 Public utility 9,658 8,297 8,261 631 505 885 815 768 521 9 Communication 3,464 2,787 3,059 291 35 344 326 546 10 Real estate and financial 6,469 9,274 10,438 898 1,027 714 761 1,296 448 11 Stocks 10,863 11,108 12,013 822 474 1,039 1,405 508 782 By type: 12 Preferred 3,458 2,803 3,878 148 235 390 586 57 157 13 Common 7,405 8,305 8,135 674 239 649 819 451 625 By industry group: 14 Manufacturing 1,670 2,237 1,265 74 15 41 366 167 236 15 Commercial and miscellaneous 1,470 1,183 1,838 94 183 90 245 167 110 16 Transportation 24 418 28 20 38 40 17 Public utility 6,235 6,121 6,058 627 238 800 429 31 354 18 Communication 1,002 776 1,379 5 27 6 19 Real estate and financial 488 771 1,054 28 10 88 320 76 75 i Figures, which represent gross proceeds of issues maturing in more companies other than closed-end, intracorporate transactions, and sales to than 1 year, sold for cash in the United States, are principal amount or foreigners. number of units multiplied by offering price. Excludes offerings of less than $100,000, secondary offerings, undefined or exempted issues as SOURCE.—Securities and Exchange Commission. defined in the Securities Act of 1933, employee stock plans, investment Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Corporate Finance A37 1.49 OPEN-END INVESTMENT COMPANIES Net Sales and Asset Position Millions of dollars 1978 IItteemm 11997766 11997777 May June July Aug. Sept. Oct. Nov. INVESTMENT COMPANIES excluding money market funds 1 Sales of own shares1 4,226 6,401 558 487 474 638 519 463 478 2 Redemptions of own shares2 6,802 6,027 831 757 645 882 673 607 439 3 -2,496 357 -273 -270 -181 -244 -154 -144 39 4 Assets3 47,537 45,049 46,969 46,106 47,975 49,299 48,151 43,462 44,134 5 Cash position4 2,747 3,274 4,642 4,493 4,285 3,948 3,703 r3,793 4,327 6 Other 44,790 41,775 42,327 41,613 43,690 45,351 44,448 r39,669 39,807 1 Includes reinvestment of investment income dividends. Excludes 4 Also includes all U.S. Government securities and other short-term reinvestment of capital gains distributions and share issue of conversions debt securities. from one fund to another in the same group. 2 Excludes share redemption resulting from conversions from one fund NOTE.—Investment Company Institute data based on reports of memto another in the same group. bers, which comprise substantially all open-end investment companies 3 Market value at end of period, less current liabilities. registered with the Securities and Exchange Commission. Data reflect newly formed companies after their initial offering of securities. 1.50 CORPORATE PROFITS AND THEIR DISTRIBUTION Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1977 1978 AAccccoouunntt 11997755 1976 1977 Q1 Q2 Q3 Q4 Ql Q2 Q3 1 Profits before tax 120.4 155.9 173.9 164.8 175.1 177.5 178.3 172.1 205.5 205.4 2 Profits tax liability 49.8 64.3 71.8 68.3 72.3 72.8 73.9 70.0 85.0 86.2 3 Profits after tax 70.6 91.6 102.1 96.5 102.8 104.7 104.4 102.1 120.5 119.2 4 Dividends 31.9 37.9 43.7 41.5 42.7 44.1 46.3 47.0 48.1 50.1 5 Undistributed profits 38.7 53.7 58.4 55.0 60.1 60.6 58.1 55.1 72.4 69.1 6 Capital consumption allowances 89.2 97.1 106.0 102.0 105.0 107.6 109.3 111.3 113.3 115.4 7 Net cash flow 127.9 150.8 164.4 157.0 165.1 168.2 167.4 166.4 185.7 184.5 SOURCE.—Survey of Current Business (U.S. Dept. of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A38 Domestic NonfinancialS tatistics • January 1979 1.51 NONFINANCIAL CORPORATIONS Current Assets and Liabilities Billions of dollars, except for ratio 1976 1977 1978 AAccccoouunntt 11997744 11997755 Q3 Q4 Ql Q2 Q3 Q4 Ql Q2r 1 Current assets 734.6 756.3 817.4 823.1 842.0 856.4 880.3 900.1 924.2 953.5 2 Cash 73.0 80.0 79.5 86.8 80.8 83.1 83.4 94.2 88.5 90.9 3 U.S. Government securities 11.3 19.6 24.1 26.0 26.8 22.1 21.5 20.9 20.9 19.7 4 Notes and accounts receivable 265.5 272.1 297.9 292.4 304.1 312.8 326.9 325.7 338.3 356.8 5 Inventories 318.9 314.7 342.2 341.4 352.1 358.8 367.5 375.0 389.7 399.1 6 Other 65.9 69.9 73.6 76.4 78.3 79.6 81.0 84.3 86.8 87.0 7 Current liabilities 451.8 446.9 484.0 487.5 502.6 509.5 528.9 543.2 570.4 590.8 8 Notes and accounts payable 272.3 261.2 271.2 273.2 280.2 286.8 297.8 306.8 317.2 331.3 9 Other 179.5 185.7 212.8 214.2 222.4 222.7 231.1 236.3 253.2 259.4 10 Net working capital 282.8 309.5 333.4 335.6 339.5 346.9 351.4 357.0 353.8 362.7 11 MEMO: Current ratio1 1.626 1.693 1.689 1.688 1.675 1.681 1.664 1.657 1.620 1.614 I (Total current assets)/(Total current liabilities). SOURCE.—Federal Trade Commission. NOTE.—For a description of this series see "Working Capital of Nonfinancial Corporations" in the July 1978 BULLETIN, pp. 533-37. 1.52 BUSINESS EXPENDITURES on New Plant and Equipment Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1977 1978 IInndduussttrryy 11997777 1199778822 Ql Q2 Q3 Q4 Ql Q2 Q3 Q4 1 All industries 135.72 152.28 130.16 134.24 140.38 138.11 144.25 150.76 155.13 158.98 Manufacturing 2 Durable goods industries 27.75 31.53 26.30 27.26 29.23 28.19 28.72 31.40 32.11 33.89 3 Nondurable goods industries 32.33 36.23 30.13 32. 19 33.79 33.22 32.86 35.80 36.54 39.72 Nonmanufacturing 4 Mining 4.49 4.78 44..2244 4.49 4.74 4.50 4.45 4.81 4.80 5.07 Transportation: 5 Railroad 2.82 3.28 2.71 2.57 3.20 2.80 3.35 3.09 3.64 3.05 6 Air 1.63 2.45 1.62 1.43 1.69 1.76 2.67 2.08 2.97 2.08 7 Other 2.55 2.27 2.96 2.96 1.96 2.32 2.44 2.23 2.37 2.05 Public utilities: 8 Electric 21.57 24.49 21.19 21.14 21.90 22.05 23.15 23.83 25.04 25.94 9 Gas and other 4.21 4.48 4.16 4. 16 4.32 4.18 4.78 4.62 4.22 4.28 1 11 0 11 C Co o m m m m e u r n c i i c a a l ti a o n n d other 1 22 1 22 5 .. . 99 4 55 3 22 1 22 4 .. . 66 1 77 9 22 1 22 5 .. . 77 3 33 2 22 1 33 6 .. . 11 4 44 0 22 1 33 5 .. . 22 8 77 2 22 1 44 7 .. . 77 0 66 7 22 1 44 8 .. . 77 1 11 8 }}} 444333...444444 444222...999000 1 Includes trade, service, construction, finance, and insurance. agriculture; real estate operators; medical, legal, educational, and cultural 2 Anticipated by business. service; and nonprofit organizations. NOTE.—Estimates for corporate and noncorporate business, excluding SOURCE.—Survey of Current Business (U.S. Dept. of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Corporate Finance A39 1.521 DOMESTIC FINANCE COMPANIES Assets and Liabilities Billions of dollars, end of period 1977 1978 AAccccoouunntt 11997722 11997733 11997744 11997755 11997766 Q3 Q4 Q1 Q2 Q3 ASSETS Accounts receivable, gross 1 Consumer 31.9 35.4 36.1 36.0 38.6 42.3 44.0 44.5 47.1 49.7 2 Business 27.4 32.3 37.2 39.3 44.7 50.6 55.2 57.6 59.5 58.3 3 Total 59.3 67.7 73.3 75.3 83.4 92.9 99.2 102.1 106.6 108.0 4 LESS: Reserves for unearned income and losses 7.4 8.4 9.0 9.4 10.5 11.7 12.7 12.8 14.1 14.3 5 Accounts receivable, net 51.9 59.3 64.2 65.9 72.9 81.2 86.5 89.3 92.6 93.7 6 Cash and bank deposits 2.8 2.6 3.0 2.9 2.6 2.5 2.6 2.2 2.9 2.7 7 Securities .9 .8 .4 1.0 1.1 1.8 .9 1.2 1.3 1.8 8 All other 10.0 10.6 12.0 11.8 12.6 14.2 14.3 15.0 16.2 17.1 9 Total assets 65.6 73.2 79.6 81.6 89.2 99.6 104.3 107.7 112.9 115.3 LIABILITIES 10 Bank loans 5.6 7.2 9.7 8.0 6.3 5.4 5.9 5.8 5.4 5.4 11 Commercial paper 17.3 19.7 20.7 22.2 23.7 25.7 29.6 29.9 31.3 29.3 Debt: 12 Short-term, n.e.c 4.3 4.6 4.9 4.5 5.4 5.4 6.2 5.3 6.6 6.8 13 Long-term, n.e.c 22.7 24.6 26.5 27.6 32.3 34.8 36.0 38.0 40.1 41.3 14 Other 4.8 5.6 5.5 6.8 8.1 13.7 11.5 12.9 13.6 15.2 15 Capital, surplus, and undivided profits 10.9 11.5 12.4 12.5 13.4 14.6 15.1 15.7 16.0 17.3 16 Total liabilities and capital 65.6 73.2 79.6 81.6 89.2 99.6 104.3 107.7 112.9 115.3 NOTE.—Components may not add to totals due to rounding. 1.522 DOMESTIC FINANCE COMPANIES Business Credit Millions of dollars, seasonally adjusted except as noted Changes in accounts Extensions Repayments Accounts receivable during— receivable Type outstanding Oct. 31, 1978 1978 1978 19781 Aug. Sept. Oct. Aug. Sept. Oct. Aug. Sept. Oct. 1 Total 60,060 716 -234 704 15,417 15,530 15,078 14,701 15,764 14,374 2 Retail automotive (commercial vehicles) 14,067 247 209 214 1,222 1,202 1,237 975 993 1,023 3 Wholesale automotive 11,099 -77 -506 103 6,314 6,119 6,171 6,391 6,625 6,068 4 Retail paper on business, industrial, and farm equipment 16,246 295 -154 160 1,225 1,198 1,041 930 1,352 881 5 Loans on commercial accounts receivable... 4,080 -19 150 -202 3,269 3,454 3,233 3,288 3,304 3,435 6 Factored commercial accounts receivable.... 2,493 55 83 291 1,481 1,584 1,543 1,426 1,501 1,252 7 All other business credit 12,075 215 -16 138 1,906 1,973 1,853 1,691 1,989 1,715 1 Not seasonally adjusted. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A40 Domestic Nonfinancial Statistics • January 1979 1.53 MORTGAGE MARKETS Millions of dollars; exceptions noted. 1978 Item 1975 1976 1977 June July Aug. Sept. Oct. Terms and yields in primary and secondary markets PRIMARY MARKETS Conventional mortgages on new homes Terms:1 1 Purchase price (thous. dollars) 44.6 48.4 54.3 62.6 61.9 63.6 64.6 66.8 65.1 2 Amount of loan (thous. dollars) 33.3 35.9 40.5 45.9 45.3 46.4 46.7 48.6 47.5 3 Loan/price ratio (per cent) 74.7 74.2 76.3 75.6 75.3 75.3 74.1 74.4 74.4 4 Maturity (years) 26.8 27.2 27.9 28.3 28.2 28.0 27.8 28.0 27.9 5 Fees and charges (per cent of loan amount)2. 1.54 1.44 1.33 1.40 1.40 1.43 1.36 1.37 1.40 6 Contract rate (per cent per annum) 8.75 8.76 8.80 9.23 9.34 9.45 9.50 r9.60 9.63 Yield (per cent per annum): 7 FHLBB series3 9.01 8.99 99..0011 9.46 9.57 9.70 9.73 9.83 9.87 8 HUD series4 9.10 8.99 8.95 9.75 9.80 9.80 9.80 r9.95 10.10 SECONDARY MARKETS Yields (per cent per annum): 9 FHA mortgages (HUD series)5 9.19 8.82 77..9966 9.92 9.78 9.78 9.93 9 99 10 8.52 8.17 8.04 9.05 9.16 8.96 8.95 9.16 9.13 FNMA auctions:7 11 9.26 8.99 8.73 9.91 10.01 9.81 9.78 10.03 10.30 12 Conventional loans 9.37 9.11 8.98 10.10 10.19 10.11 10.02 10.19 10.56 Activity in secondary markets FEDERAL NATIONAL MORTGAGE ASSOCIATION Mortgage holdings (end of period) 13 Total 31,824 32,904 34,370 38,753 39,409 40,325 41,189 41,957 42,590 14 19,732 18,916 18,457 19,608 19,763 20,034 20,325 20,625 20,929 15 V A-guaranteed 9,573 9,212 9,315 10,398 10,457 10,535 10,575 10,565 10,535 16 2,519 4,776 6,597 8,747 9,189 9,752 10,289 10,767 11,126 Mortgage transactions (during period) 17 4,263 3,606 497 1,148 945 11,,223300 11,,113322 11,,005533 920 1188 Sales 2 8866 Mortgage commitments:8 19 Contracted (during period) 6,106 6,247 1,333 1,517 927 527 882 1,900 1,275 20 Outstanding (end of period). 4,126 3,398 4,698 10,395 10,171 9,419 9,068 9,547 9,525 Auction of 4-month commitments to buy— Government-underwritten loans: 21 Offered 9 7,042.6 4,929.8 1,184.5 1,095.0 756.7 499.1 717.9 1,964.8 788.0 22 3,848.3 2,787.2 794.0 636.6 471.5 277.2 335.9 832.4 321.8 Conventional loans: 23 Offered9 1,401.3 2,595.7 591.6 574.5 316.0 224.7 484.7 1,156.8 861.4 24 765.0 1,879.2 359.4 342.0 178.9 128.5 283.7 495.6 386.8 FEDERAL HOME LOAN MORTGAGE CORPORATION Mortgage holdings (end of period)10 25 Total 4,987 44,,226699 33,,227766 2,255 2,024 2,448 2,486 2,867 3,022 26 FHA/VA 1,824 1,618 1,395 1,338 1,321 1,304 1,287 1,594 1,257 27 3,163 2,651 1,881 917 702 1,144 1,199 1,273 1,766 Mortgage transactions (during period) 28 1,716 11,,117755 448899 500 520 742 670 791 763 29 Sales 1,020 1,396 477 1,093 725 299 594 369 581 Mortgage commitments:11 30 Contracted (during period) 982 1,477 361 762 737 838 760 547 706 31 Outstanding (end of period) 111 333 1,063 1,870 2,055 2,142 2,130 1,716 1,617 1 Weighted averages based on sample surveys of mortgages originated securities, assuming prepayment in 12 years on pools of 30-year FHA/VA by major institutional lender groups. Compiled by the Federal Home mortgages carrying the prevailing ceiling rate. Monthly figures are Loan Bank Board in cooperation with the Federal Deposit Insurance unweighted averages of Monday quotations for the month. Corporation. 7 Average gross yields (before deduction of 38 basis points for mortgage 2 Includes all fees, commissions, discounts, and "points" paid (by the servicing) on accepted bids in Federal National Mortgage Association's borrower or the seller) in order to obtain a loan. auctions of 4-month commitments to purchase home mortgages, assuming 3 Average effective interest rates on loans closed, assuming prepay- prepayment in 12 years for 30-year mortgages. No adjustments are made ment at the end of 10 years. for FNMA commitment fees or stock related requirements. Monthly 4 Average contract rates on new commitments for conventional first figures are unweighted averages for auctions conducted within the month. mortgages, rounded to the nearest 5 basis points; from Dept. of Housing 8 Includes some multifamily and nonprofit hospital loan commitments and Urban Development. in addition to 1- to 4-family loan commitments accepted in FNMA's 5 Average gross yields on 30-year, minimum-downpayment, Federal free market auction system, and through the FNMA-GNMA Tandem Housing Administration-insured first mortgages for immediate delivery plans. in the private secondary market. Any gaps in data are due to periods of 9 Mortgage amounts offered by bidders are total bids received. adjustment to changes in maximum permissible contract rates. I o Includes participations as well as whole loans. 6 Average net yields to investors on Government National Mortgage II Includes conventional and Government-underwritten loans. Association-guaranteed, mortgage-backed, fully-modified pass-through Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Real Estate Debt A41 1.54 MORTGAGE DEBT OUTSTANDING Millions of dollars, end of period 1977 1978 Type of holder, and type of property 11997733 1974 1975 1976 Q4 Q1 Q2 Q3P 1 All holders 682,321 742,512 801,537 889,327 1,023,417 1,052,307 1,090,234 1,128,398 2 1- to 4-family 416,211 449,371 490,761 556,557 656,116 675,514 701,392 727,096 3 Multifamily 93,132 99,976 100,601 104,516 111,804 114,202 116,793 119,422 4 Commercial 131,725 146,877 159,298 171,223 189,829 194,545 201,054 208,017 5 Farm 41,253 46,288 50,877 57,031 65,668 68,046 71,004 73,863 6 Major financial institutions 505,400 542,560 581,193 647,650 745,011 764,614 792,762 819,264 7 Commercial banks1 119,068 132,105 136,186 151,326 178,979 184,423 193,223 202,423 8 1- to 4-family 67,998 74,758 77,018 86,234 105,115 108,699 113,886 119,308 9 Multifamily 6,932 7,619 5,915 8,082 9,215 9,387 9,816 10,283 10 Commercial 38,696 43,679 46,882 50,289 56,898 58,407 61,194 64,107 11 Farm 5,442 6,049 6,371 6,721 7,751 7,930 8,327 8,725 12 Mutual savings banks 73,230 74,920 77,249 81,639 88,104 89,800 91,535 93,511 13 1- to 4-family 48,811 49,213 50,025 53,089 57,637 58,747 59,882 61,175 14 Multifamily 12,343 12,923 13,792 14,177 15,304 15,398 15,900 16,243 15 Commercial 12,012 12,722 13,373 14,313 15,110 15,401 15,698 16,037 16 Farm 64 62 59 60 53 54 55 56 17 Savings and loan associations 231,733 249,301 278,590 323,130 381,163 392,479 407,964 420,947 18 1- to 4-family 187,078 200,987 223,903 260,895 310,686 319,910 332,532 343,114 19 Multifamily 22,779 23,808 25,547 28,436 32,513 33,478 34,779 35,907 20 Commercial 21,876 24,506 29,140 33,799 37,964 39,091 40,633 41,926 21 Life insurance companies 81,369 86,234 89,168 91,555 96,765 97,963 100,040 102,383 22 1- to 4-family 20,426 19,026 17,590 16,088 14,727 14,476 14,129 13,929 23 Multifamily 18,451 19,625 19,629 19,178 18,807 18,851 18,745 18,945 24 Commercial 36,496 41,256 45,196 48,864 54,388 55,426 57,463 59,309 25 Farm 5,996 6,327 6,753 7,425 8,843 9,210 9,703 10,200 26 Federal and related agencies 46,721 58,320 66,891 66,753 70,006 72,014 73,991 77,919 27 Government National Mortgage Assn, 4,029 4,846 7,438 4,241 3,660 3,291 3,283 3,523 28 1-to 4-family 1,455 2,248 4,728 1,970 1,548 948 922 989 29 Multifamily 2,574 2,598 2,710 2,271 2,112 2,343 2,361 2,534 30 Farmers Home Admin 1,366 1,432 1,109 1,064 1,353 1,179 618 668 31 1- to 4-family 743 759 208 454 626 202 124 135 32 Multifamily 29 167 215 218 275 408 102 110 33 Commercial 218 156 190 72 149 218 104 112 34 Farm 376 350 496 320 303 351 288 311 35 Federal Housing and Veterans Admin, 3,476 4,015 4,970 5,150 5,212 5,219 5,225 5,295 36 1-to 4-family 2,013 2,009 1,990 1,676 1,627 1,585 1,543 1,565 37 Multifamily 1,463 2,006 2,980 3,474 3,585 3,634 3,682 3,730 38 Federal National Mortgage Assn... . 24,175 29,578 31,824 32,904 34,369 36,029 38,753 41,189 39 1-to 4-family 20,370 23,778 25,813 26,934 28,504 30,208 32,974 35,437 40 Multifamily 3,805 5,800 6,011 5,970 5,865 5,821 5,779 5,752 41 Federal land banks 11,071 13,863 16,563 19,125 22,136 22,925 23,857 24,758 42 1-to 4-family 123 406 549 601 670 691 727 819 43 Farm 10,948 13,457 16,014 18,524 21,466 22,234 23,130 23,939 44 Federal Home Loan Mortgage Corp. 2,604 4,586 4,987 4,269 3,276 3,371 2,255 2,486 45 1- to 4-family 2,446 4,217 4,588 3,889 2,738 2,785 1,856 1,994 46 Multifamily 158 369 399 380 538 586 399 492 47 Mortgage pools or trusts2 18,040 23,799 34,138 49,801 70,289 74,080 78,602 82,325 48 Government National Mortgage Assn. 7,890 11,769 18,257 30,572 44,896 46,357 48,032 50,844 49 1- to 4-family 7,561 11,249 17,538 29,5 83 43,555 44,906 46,515 49,276 50 Multifamily 329 520 719 989 1,341 1,451 1,517 1,568 51 Federal Home Loan Mortgage Corp. 766 757 1,598 2,671 6,610 7,471 9,423 9,934 52 1- to 4-family 617 608 1,349 2,282 5,621 6,286 7,797 8,358 53 Multifamily 149 149 249 389 989 1,185 1,626 1,576 54 Farmers Home Admin 9,384 11,273 14,283 16,558 18,783 20,252 21,147 21,547 55 1- to 4-family 5,458 6,782 9,194 10,219 11,379 12,235 12,742 12,943 56 Multifamily 138 116 295 532 759 732 1,128 1,154 57 Commercial 1 ,124 1,473 1 ,948 2,440 2,945 3,528 3,301 3,380 58 Farm 2,664 2,902 2,846 3,367 3,682 3,757 3,976 4,070 59 Individuals and others3 112,160 117,833 119,315 125,123 138,111 141,599 144,888 148,890 60 1- to 4-family 51 ,112 53,331 56,268 62,643 71,665 73,878 75,763 78,054 61 Multifamily 23,982 24,276 22,140 20,420 20,501 20,732 20,939 21,128 62 Commercial 21,303 23,085 22,569 21,446 22,375 22,479 22,661 23,146 63 Farm 15,763 17,141 18,338 20,614 23,570 24,510 25,525 26,562 1 Includes loans held by nondeposit trust companies but not bank trust NOTE.—Based on data from various institutional and Govt, sources, departments. with some quarters estimated in part by Federal Reserve in conjunction 2 Outstanding principal balances of mortgages backing securities in- with the Federal Home Loan Bank Board and the Dept. of Commerce. sured or guaranteed by the agency indicated. Separation of nonfarm mortgage debt by type of property, if not re- 3 Other holders include mortgage companies, real estate investment ported directly, and interpolations and extrapolations where required, are trusts, State and local credit agencies, State and local retirement funds, estimated mainly by Federal Reserve. Multifamily debt refers to loans on noninsured pension funds, credit unions, and U.S. agencies for which structures of 5 or more units. amounts are small or separate data are not readily available. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A42 Domestic Nonfinancial Statistics • January 1979 1.55 CONSUMER INSTALMENT CREDIT1 Total Outstanding, and Net ChangeA Millions of dollars 1978 Holder, and type of credit 1975 1976 1977 May June July Aug. Sept. Oct. Nov. Amounts outstanding (end of period) 1 Total 172,353 193,977 230,829 243,371 249,865 253,897 259,614 263,387 r265,821 269,445 By major holder: 2 3 C Fi o n m an m c e e r c c i o a m l p b a a n n i k e s s 8 3 2 5 9 , , 9 9 9 3 5 6 9 3 3 8 , , 7 9 2 1 8 9 1 4 1 4 2 , , 8 3 6 7 8 3 1 4 2 7 0 , , 5 4 8 4 0 0 1 4 2 8 4 , , 6 0 3 8 7 0 1 4 2 9 6 , , 5 61 0 9 2 1 5 2 0 9 , , 5 6 5 2 8 2 1 5 3 1 1 , , 2 40 8 3 0 r13 5 2 1 , , 7 9 0 8 2 4 1 5 3 3 3 , , 0 9 9 0 9 8 4 Credit unions 25,666 31,169 37,605 40,481 41,936 42,355 43,499 44,325 44,635 45,305 5 Retailers 2 18,201 19,260 23,490 21,744 21,813 21,828 22,093 22,302 22,464 23,006 6 Savings and loans 5,162 6,246 7,354 7,727 7,764 7,793 7,947 8,055 8,177 8,291 7 Gasoline companies. ., 2,706 2,830 2,963 3,069 3,185 3,309 3,354 3,416 3,276 3,173 8 Mutual savings banks. 1,687 1,825 2,176 2,330 2,450 2,491 2,541 2,606 2,583 2,663 By major type of credit: 9 Automobile 57,242 67,707 82,911 90,359 93,261 95,289 97,687 99,062 100,159 101,565 10 Commercial banks. . 33,287 39,621 49,577 54,078 55,754 57,071 58,453 59,085 59,IIS 60,347 11 Indirect paper 19,332 22,072 27,379 30,169 31,128 31,907 32,667 33,067 33,415 33,709 12 Direct loans 13,955 17,549 22,198 23,909 24,626 25,164 25,786 26,018 26,363 26,638 13 Credit unions 12,741 15,238 18,099 19,357 20,054 20,254 20,801 21,196 21,344 21,664 14 Finance companies., 11,214 12,848 15,235 16,924 17,453 17,964 18,433 18,781 19,037 19,554 15 Revolving 15,019 17,189 3399,,227744 3388,,996677 4400,,000011 4400,,555533 4411,,662299 4422,,442200 4422,,557799 4433,,552233 16 Commercial banks. . 12,313 14,359 1188,,337744 1199,,337788 2200,,113355 2200,,556666 2211,,331144 2211,,993355 2222,,116655 2222,,772244 17 Retailers 1177,,993377 1166,,552200 1166,,668811 1166,,667788 1166,,996611 1177,,006699 1177,,113388 1177,,662266 18 Gasoline companies. 2,706 2,830 22,,996633 33,,006699 33,,118855 33,,330099 33,,335544 33,,441166 33,,227766 33,,117733 19 Mobile home 14,434 14,573 15,141 15,396 15,532 15,663 15,799 15,910 15,925 16,017 20 Commercial banks. 8,667 8,737 9,124 9,275 9,386 9,483 9,539 9,591 9,548 9,572 21 Finance companies. 3,445 3,263 3,077 3,060 3,065 3,085 3,101 3,114 3,127 3,150 22 Savings and loans.. 2,050 2,241 2,538 2,629 2,634 2,644 2,696 2,733 2,775 2,813 23 Credit unions 272 332 402 432 447 451 463 472 475 482 24 Other 85,658 94,508 93,503 98,649 101,071 102,392 104,499 105,995 r107,158 108,340 25 Commercial banks 28,669 31,011 35,298 37,709 38,805 39,499 40,316 40,792 Ml,211 41,265 26 Finance companies 21,336 22,808 26,556 27,596 28,119 28,453 29,024 29,385 29,820 30,395 27 Credit unions 12,653 15,599 19,104 20,692 21,435 21,650 22,235 22,657 r22,816 23,159 28 Retailers 18,201 19,260 5,553 5,224 5,132 5,150 5,132 5,233 5,326 5,380 29 Savings and loans 3,112 4,005 4,816 5,098 5,130 5,149 5,251 5,322 5,402 5,478 30 Mutual savings banks. 1,687 1,825 2,176 2,330 2,450 2,491 2,541 2,606 2,583 2,663 Net change (during period)3 31 Total 7,765 21,647 35,278 4,280 4,207 3,466 3,632 3,680 '3,374 4,099 By major holder: 3 3 3 3 2 4 C C Fi r o n e m a d n m it c e e u r n c c i i o a o m l n s p b a a n n i k e s s 2 3 , , - 7 8 8 6 8 2 6 1 1 2 5 0 , , , 9 5 7 4 0 9 6 3 2 1 6 5 8 , , , 4 9 6 3 4 4 6 8 5 2,2 8 8 6 6 4 0 9 1 2,3 6 7 8 9 2 7 7 4 2,1 6 5 0 7 1 0 1 3 1,7 7 6 8 3 1 5 6 3 1,7 6 8 1 3 4 4 9 7 rl,6 6 8 1 4 6 7 4 3 1 1 , , 0 9 7 1 2 7 8 5 9 35 Retailers i 87 1,059 2,654 135 234 144 342 328 115 118866 36 Savings and loans 829 1,085 1,111 67 57 10 107 94 nil 8888 37 Gasoline companies. .. 104 124 132 22 20 -19 — 1 9 16 38 Mutual savings banks. 180 138 352 86 47 50 49 -8 104 By major type of credit: 39 Automobile 2,976 10,465 15,204 1,877 1,642 1,711 1,604 1,532 r1,375 1,755 40 Commercial banks. . 513 6,334 9,956 1,036 1,029 1,041 957 848 H59 839 41 Indirect paper -392 2,742 5,307 646 587 626 515 517 354 440 42 Direct loans 905 3,592 4,649 390 442 415 442 331 r405 399 43 Credit unions 1,872 2,497 2,861 377 349 275 287 313 301 364 44 Finance companies.. 591 1,634 2,387 464 264 395 360 371 315 552 45 Revolving 1,340 2,170 6,248 644 955 600 737 622 346 665 46 Commercial banks. . 1,236 2,046 4,015 489 601 498 358 380 337 556 47 Retailers 2,101 133 334 121 380 233 -7 110 48 Gasoline companies. 104 124 132 22 20 -19 -1 9 16 -1 4 5 9 0 Mo C bi o le m m ho e m rc e i al banks. - - 2 3 0 3 8 0 14 7 0 0 5 3 6 8 5 7 10 7 1 7 5 7 0 0 6 83 5 2 7 0 9 3 7 1 2 -2 2 5 5 1 75 9 51 Finance companies. -76 -182 -189 2 11 7 6 -2 15 52 Savings and loans.. 161 192 297 14 12 2 46 27 46 34 53 Credit unions 37 60 70 7 5 6 8 6 7 54 Other 3,657 8,872 13,261 1,658 1,540 1,072 1,212 1,454 r1,628 1,604 55 Commercial banks 1.462 2,342 4,287 658 707 496 450 455 r546 511 56 Finance companies -597 1,494 3,750 395 359 265 369 470 550 451 57 Credit unions 1,857 2,946 3,505 464 441 233 320 318 337 408 58 Retailers 87 1,059 553 2 -100 23 -38 95 122 76 59 Savings and loans 668 893 814 53 45 8 61 67 r81 54 60 Mutual savings banks. 180 138 352 86 47 50 49 -8 104 1 The Board's series cover most short- and intermediate-term credit NOTE.—Total consumer noninstalment credit outstanding—credit extended to individuals through regular business channels, usually to scheduled to be repaid in a lump sum, including single-payment loans, finance the purchase of consumer goods and services or to refinance charge accounts, and service credit—amounted to $58.2 billion at the end debts incurred for such purposes, and scheduled to be repaid (or with of 1977. $55.0 billion at the end of 1976, $50.8 billion at the end of 1975, the option of repaying in two or more instalments). and $48.4 billion at the end of 1974. Comparable data for Dec. 31, 1978 2 Includes auto dealers and excludes 30-day charge credit held by will be published in the February 1979 BULLETIN. tra 3 v e N l e a t n c d h a e n n g te e r e ta q i u n a m ls e n e t x t c e o n m sio p n a s n i m es i . n us liquidations (repayments, charge- eff A ec t C iv o e ns D u e m c. e r 7, i n 1 st 9 a 7 l 8 m . en In t fo c r r m ed a it t io s n e ri i e s s a h v a a v i e l ab b l e e e n f r r o e m v is M ed o r f t r g o a m g e 1 a 94 n 3 d , offs, and other credits); figures for all months are seasonally adjusted. Consumer Finance Section, Division of Research and Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Consumer Debt A43 1.56 CONSUMER INSTALMENT CREDIT Extensions and Liquidations J Millions of dollars 1978 Holder, and type of credit 1975 1976 1977 May June July Aug. Sept. Oct. Extensions2 1 Total. 180,441 211,028 254,071 25,104 25,565 25,022 25,669 25,536 '25,785 By major holder: 2 Commercial banks 80,797 97,397 117,896 12,067 12,382 12,187 12,255 12,123 '12,182 3 Finance companies 31,183 36,129 41,989 4,179 4,223 4,261 4,348 4,372 4,605 4 Credit unions 24,094 29,259 34,028 3,484 3,445 3,271 3,379 3,360 3,401 5 Retailers1 27 302 29,447 39,133 3,408 3,552 3,477 3,725 3,718 3,518 6 Savings and loans 3,116 3,898 4,485 383 379 327 435 403 '566 7 Gasoline companies. .. 12,497 13,387 14,617 1,356 1,351 1,299 1,317 1,346 1,335 8 Mutual savings banks. 1,452 1,511 1,923 227 233 200 210 215 151 By major type of credit: 9 Automobile. 52,420 63,743 75,641 7,592 7,595 7,652 7,744 7,542 r7,501 10 Commercial banks. 30,095 37,886 46,363 4,547 4,541 4,639 4,660 4,479 '4,345 11 Indirect paper. . . 16,578 20,576 25,149 2,550 2,505 2,554 2,562 2,519 2,384 12 Direct loans 13,517 17,310 21,214 1,997 2,036 2,085 2,098 1,960 '1,961 13 Credit unions 12,683 14,688 16,616 1,680 1,667 1,629 1,632 1,641 1,643 14 Finance companies. 9,642 11,169 12,662 1,365 1,387 1,384 1,452 1,422 1,513 15 Revolving 36,956 43,934 86,756 8,563 9.062 8,700 9,028 9,006 8,846 16 Commercial banks. . 24,459 30,547 38,256 4,191 4,451 4,320 4,346 4,457 4,475 17 Retailers 33,883 3,016 3,260 3,081 3.365 3,203 3,036 18 Gasoline companies. 12,497 13,387 14,617 1,356 1,351 1,299 1,317 1,346 1,335 19 Mobile home 4,328 4,859 5,425 527 510 509 531 494 604 20 Commercial banks. 2,625 3,064 3,466 346 327 335 310 297 352 21 Finance companies. 767 702 643 69 73 78 75 77 73 22 Savings and loans.. 815 929 1,120 92 90 78 127 100 154 23 Credit unions 121 164 196 20 20 18 19 20 25 24 Other 86,737 98,492 86,249 8,422 8,398 8,161 8.366 8,495 r8,807 25 Commercial banks 23,618 25,900 29,811 2,983 3.063 2,893 2,939 2,890 '3,010 26 Finance companies 20,774 24,258 28,684 2,745 2,763 2,799 2,821 2,873 3,019 27 Credit unions 11,290 14,407 17,216 1,784 1,758 1,624 1,728 1,699 1,733 28 Retailers 27,302 29,447 5,250 392 292 396 360 515 482 29 Savings and loans 2,301 2,969 3,365 291 289 249 308 303 '412 30 Mutual savings banks. 1,452 1,511 1,923 227 233 200 210 215 151 Liquidations2 31 Total. 172,676 189,381 218,793 20,824 21,358 21,556 22,037 21,857 '22,384 By major holder: Commercial banks 77,916 86,605 99,251 9,807 9,995 10,087 10,470 10,409 10,565 Finance companies 31,265 33,183 36,041 3,318 3,599 3,590 3,612 3,525 3,742 Credit unions 20,328 23,756 27,592 2,635 2,648 2,758 2,766 2,721 2,757 Retailers1 27,215 28,388 36,479 3,273 3,318 3,333 3,383 3,390 3,403 Savings and loans 2,287 2,813 3,374 316 322 317 328 309 439 Gasoline companies. ., 12,393 13,263 14,485 1,334 1,331 1,318 1,318 1,337 '1,319 Mutual savings banks. 1,272 1,373 1,571 141 145 153 160 166 159 By major type of credit: 39 Automobile 49,444 53,278 60,437 5,715 5,953 5,941 6,140 6,010 6,126 40 Commercial banks. . 29,582 31,552 36,407 3,511 3,512 3,598 3,703 3,631 3,586 41 Indirect paper 16,970 17,834 19,842 1,904 1,918 1,928 2,047 2,002 2,030 42 Direct loans 12,612 13,718 16,565 1,607 1,594 1,670 1,656 1,629 1,556 43 Credit unions 10,811 12,191 13,755 1,303 1,318 1,354 1,345 1,328 '1,342 44 Finance companies.. 9,051 9,535 10,275 901 1,123 989 1,092 1,051 1,198 45 Revolving 35,616 41,764 80,508 7,919 8,107 8,100 8,291 8,384 8,500 46 Commercial banks. . 23,223 28,501 34,241 3.702 3,850 3,822 3,988 4,077 4,138 47 Retailers 31,782 2,883 2,926 2,960 2,985 2,970 3,043 48 Gasoline companies. 12,393 13,263 14,485 1,334 1,331 1,318 1,318 1,337 1,319 49 Mobile home 4,536 4,719 4,860 426 440 426 452 422 579 50 Commercial banks. 2,955 2,994 3,079 269 277 270 290 266 377 51 Finance companies. 843 884 832 67 72 67 68 71 75 52 Savings and loans.. 654 737 823 78 78 76 81 73 108 53 Credit unions 84 104 126 12 13 13 13 12 19 54 Other 83,080 89,620 72,988 6,764 6,858 7,089 7,154 7,041 179 55 Commercial banks 22,156 23,558 25,524 2,325 2,356 2,397 2,489 2,435 464 56 Finance companies 21,371 22,764 24,934 2,350 2,404 2,534 2,452 2,403 469 57 Credit unions 9,433 11,461 13,711 1,320 1,317 1,391 1,408 1,381 396 58 Retailers 27,215 28,388 4,697 390 392 373 398 420 360 59 Savings and loans 1,633 2,076 2,551 238 244 241 247 236 331 60 Mutual savings banks. 1,272 1,373 1,571 141 145 153 160 166 159 1 Includes auto dealers and excludes 30-day charge credit held by A Consumer instalment credit series have been revised from 1943, travel and entertainment companies. effective Dec. 7, 1978. Information is available from Mortgage and Con- 2 Monthly figures are seasonally adjusted. sumer Finance Section, Division of Research and Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A44 Domestic Financial Statistics • January 1979 1.57 FUNDS RAISED IN U.S. CREDIT MARKETS Billions of dollars; quarterly data are at seasonally adjusted annual rates. 1975 1976 1977 1978 Transaction category, or sector 1973 1974 1975 1976 1977 HI H2 HI H2 HI H2 HI Nonfinancial sectors 1 Total funds raised 203.8 188.8 208.1 272.5 340.5 177.5 238.9 259.6 285.6 302.2 378.9 371.4 2 Excluding equities 196.1 184.9 198.0 261.7 337.4 167.0 229.2 245.9 277.5 301.0 373.8 371.3 By sector and instrument: 3 U.S. government 8.3 11.8 85.4 69.0 56.8 78.3 92.5 73.5 64.5 42.6 71.0 58.8 4 Public debt securities 7.9 12.0 85.8 69.1 57.6 79.1 92.6 73.4 64.9 43.1 72.2 59.1 5 Agency issues and mortgages .4 -.2 -.4 -.1 -.9 -.8 _ l .1 -.3 -.6 -1.2 -.9 6 All other nonfinancial sectors 195.5 177.0 122.7 203.5 283.8 99.2 146.4 186.0 221.0 259.6 307.9 331122..66 7 Corporate equities 7.7 3.8 10.1 10.8 3.1 10.5 9.7 13.6 8.1 1.2 5.1 ..11 8 Debt instruments 187.9 173.1 112.6 192.6 280.6 88.7 136.6 172.4 213.0 258.5 302.8 312.5 9 Private domestic nonfinancial sectors. . 189.3 161.6 109.5 182.8 271.4 89.1 130.0 168.5 197.2 252.1 290.7 298.8 10 Corporate equities 7.9 4.1 9.9 10.5 2.7 10.3 9.5 13.3 7.7 .5 4.9 .9 11 Debt instruments 181.4 157.5 99.6 172.3 268.7 78.8 120.5 155.2 189.5 251.6 285.8 297.9 12 Debt capital instruments 105.0 98.0 97.8 126.8 181.1 93.7 101.9 117.8 135.9 163.4 198.9 182.7 13 State and local obligations.... 14.7 16.5 15.6 19.0 29.2 11.1 20.0 19.3 18.7 29.3 29.0 29.0 14 Corporate bonds 9.2 19.7 27.2 22.8 21.0 34.5 19.9 22.2 23.5 16.0 26.0 1188..44 Mortgages : 1155 Home 46.4 34.8 39.5 63.7 96.4 33.9 45.1 56.9 70.5 88.5 104.2 91.4 16 Multifamily residential 10.4 6.9 * 1.8 7.4 .1 -.1 .6 3.1 6.4 8.4 9.7 17 Commercial 18.9 15.1 11.0 13.4 18.4 9.1 12.9 13.8 12.9 14.2 22.6 24.5 18 Farm 5.5 5.0 4.6 6.1 8.8 5.1 4.1 4.9 7.3 8.9 8.7 9.8 19 Other debt instruments 76.4 59.6 1.8 45.5 87.6 -14.9 18.6 37.4 53.6 88.2 86.9 115.2 20 Consumer credit 23.8 10.2 9.4 23.6 35.0 2.2 16.6 22.9 24.3 35.7 34.4 44.8 21 Bank loans n.e.c 39.8 29.0 -14.0 3.5 30.6 -23.7 -4.3 -2.7 9.6 34.0 27.2 47.1 22 Open market paper 2.5 6.6 -2.6 4.0 2.9 -1.9 -3.2 5.6 2.4 3.5 2.4 5.2 23 Other 10.3 13.7 9.0 14.4 19.0 8.5 9.5 11.6 17.3 15.0 23.0 18.1 24 By borrowing sector 189.3 161.6 109.5 182.8 271.4 89.1 130.0 168.5 197.2 252.1 290.7 298.8 25 State and local governments 13.2 15.5 13.2 18.5 25.9 8.8 17.5 17.6 19.5 22.7 29.0 22.1 26 Households 80.9 49.2 48.6 89.9 139.6 37.1 60.2 82.7 97.1 131.2 148.0 141.1 27 Farm 9.7 7.9 8.7 11.0 14.7 8.5 9.0 9.9 12.1 15.5 13.8 15.8 28 Nonfarm noncorporate 12.8 7.4 2.0 5.2 12.6 -1.0 5.1 4.0 6.4 12.8 12.3 20.7 29 Corporate 72.7 81.8 37.0 58.2 78.7 35.8 38.2 54.3 62.2 69.8 87.6 92.5 30 Foreign 6.2 15.3 13.2 20.7 12.3 10.0 16.4 17.5 23.8 7.5 17.2 13.8 31 Corporate equities -.2 -.2 .2 .3 .4 .1 .2 .3 .3 .6 .2 -.8 32 Debt instruments 6.4 15.6 13.0 20.4 11.9 9.9 16.2 17.2 23.5 6.9 17.0 14.6 33 Bonds 1.0 2.1 6.2 8.5 5.0 5.7 6.8 7.4 9.7 4.4 5.6 4.9 34 Bank loans n.e.c 2.8 4.7 3.7 6.6 1.6 1.6 5.9 5.4 7.9 -3.2 6.4 2.9 35 Open market paper .9 7.3 .3 1.9 2.4 -.8 1.4 1.5 2.4 2.7 2.2 3.6 36 U.S. government loans 1.7 1.5 2.8 3.3 3.0 3.4 2.2 2.9 3.6 3.1 2.9 3.2 Financial sectors 37 Total funds raised 57.6 36.4 11.7 29.2 58.8 12.4 10.9 27.9 30.5 61.5 56.2 101.5 By instrument: 38 U.S. government related 19.9 23.1 13.5 18.6 26.3 14.2 12.9 18.2 19.0 25.0 27.5 40.1 39 Sponsored credit agency securities.... 16.3 16.6 2.3 3.3 7.0 1.6 3.1 4.1 2.6 9.5 4.4 24.1 40 Mortgage pool securities 3.6 5.8 10.3 15.7 20.5 11.5 9.2 14.2 17.2 17.9 23.1 1166..00 41 Loans from U.S. government .7 .9 -.4 -1.2 1.1 .6 * - .7 -2.3 42 Private financial sectors 37.7 13.3 -1.9 10.6 32.6 — 1.8 -2.0 9.7 11.5 36.5 28.7 61.4 43 Corporate equities 1.5 .3 .6 1.0 .6 .6 .6 -.2 2.3 .5 .7 44 Debt instruments 36.2 13.0 -2.5 9.6 32.0 -2.4 -2.6 10.0 9.2 36.0 28.0 60.3 45 Corporate bonds 3.5 2.1 2.9 5.8 10.1 1.9 4.0 6.4 5.2 10.1 10.1 8.5 46 Mortgages -1.2 -1.3 2.3 2.1 3.1 1.4 3.1 1.5 2.7 3.3 2.9 2.4 47 Bank loans n.e.c 8.9 4.6 -3.6 -3.7 * -4.3 -2.9 -2.6 -4.8 -2.3 2.3 .4 48 Open market paper and RPs 17.8 .9 — 1 7.3 14.4 5.1 -5.4 6.2 8.5 21.4 7.4 35.0 49 Loans from FHLBs 7.2 6.7 —4.0 -2.0 4.3 -6.5 -1.4 -1.5 -2.5 3.4 5.2 14.1 By sector: 57.6 36.4 11.7 29.2 58.8 12.4 10.9 27.9 30.5 61.5 56.2 101.5 50 Sponsored credit agencies 16.3 17.3 3.2 2.9 5.8 2.7 3.8 4.0 1.8 7.1 4.4 24.1 51 Mortgage pools 3.6 5.8 10.3 15.7 20.5 11.5 9.2 14.2 17.2 17.9 23.1 16.0 52 Private financial sectors 37.7 13.3 -1.9 10.6 32.6 -1.8 -2.0 9.7 11.5 36.5 28.7 61.4 53 Commercial banks 14.1 -5.6 -1.4 7.5 4.8 3.9 -6.7 9.0 6.0 10.0 -.4 12.2 54 Bank affiliates 2.2 3.5 .3 -.8 1.3 .9 -.3 -1.3 -.3 1.3 1.2 5.8 55 Savings and loan associations 6.0 6.3 -2.2 * 11.9 -7.2 2.7 1 -.1 10.6 13.1 19.6 56 Other insurance companies .5 .9 1.0 .9 .9 .9 1.0 '.9 .9 .9 1.0 1.0 57 Finance companies 9.4 6.0 .6 6.4 16.9 -2.2 3.4 6.0 6.9 17.4 16.4 18.7 58 REITs 6.5 .6 -1.4 -2.4 -2.4 -1.5 -1.2 -2.1 -2.7 -2.5 -2.2 -1.2 59 Open-end investment companies -1.2 -.7 — 1 -1.0 -1.0 .8 -1.0 -2.4 .4 -.8 -1.2 -.6 60 Money market funds 2.4 rr..33 * ..22 2.6 1 --..55 ..55 --..55 ..99 55..99 All sectors 61 Total funds raised, by instrument 261.4 225.1 219.8 301.7 399.4 189.8 249.8 287.5 316.0 363.7 435.0 472.9 62 Investment company shares -1.2 -.7 —. l -1.0 -1.0 .8 -1.0 -2.4 .4 -.8 -1.2 -.6 63 Other corporate equities 10.4 4.8 10.8 12.9 4.8 10.3 11.3 15.8 9.9 2.5 7.0 1.7 64 Debt instruments 252.3 221.0 209.1 289.8 395.6 178.8 239.5 274.1 305.7 362.0 429.2 471.7 65 U.S. government securities 28.3 34.3 98.2 88.1 84.3 91.5 104.9 91.9 84.3 70.0 98.6 99.0 66 State and local obligations 14.7 16.5 15.6 19.0 29.2 11.1 20.0 19.3 18.7 29.3 29.0 29.0 67 Corporate and foreign bonds 13.6 23.9 36.4 37.2 36.1 42.1 30.7 36.1 38.4 30.5 41.7 31.8 68 Mortgages 79.9 60.5 57.2 87.1 134.0 49.4 65.0 77.7 96.4 121.2 146.7 137.6 69 Consumer credit 23.8 10.2 9.4 23.6 35.0 2.2 16.6 22.9 24.3 35.7 34.4 44.8 70 Bank loans n.e.c 51.6 38.3 -13.9 6.4 32.2 -26.4 -1.3 .1 12.6 28.4 35.9 50.4 71 Open market paper and RPs 21.2 14.8 -2.4 13.3 19.8 2.4 -7.3 13.3 13.3 27.6 11.9 43.7 72 Other loans 19.1 22.6 8.7 15.3 25.1 6.5 10.9 12.9 17.7 19.2 31.0 35.4 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Flow of Funds A45 1.58 DIRECT AND INDIRECT SOURCES OF FUNDS TO CREDIT MARKETS Billions of dollars, except as noted; quarterly data are at seasonally adjusted annual rates. 1975 1976 1977 1978 TTrraannssaaccttiioonn ccaatteeggoorryy,, oorr sseeccttoorr 11997733 11997744 11997755 11997766 11997777 HI H2 HI H2 HI H2 HI 1 Total funds advanced in credit markets to nonfinancial sectors 196.1 184.9 198.0 261.7 337.4 167.0 229.2 245.9 277.5 301.0 373.8 371.3 By public agencies and foreign: 2 Total net advances 34.1 52.6 44.3 54.5 8855..44 51.9 3366..77 49.7 59.3 69.3 101.6 102.9 3 U.S. government securities 9.5 11.9 22.5 26.8 40.2 31.2 13.7 24.4 29.3 27.2 53.2 42.6 4 Residential mortgages 8.2 14.7 16.2 12.8 20.4 16.8 15.7 11.8 13.7 20.0 20.9 22.9 5 FHLB advances to S&Ls 7.2 6.7 -4.0 -2.0 4.3 -6.5 -1.4 -1.5 -2.5 3.4 5.2 14.1 6 Other loans and securities 9.2 19.4 9.5 16.9 20.5 10.4 8.7 15.0 18.8 18.6 22.4 23.4 Totals advanced, by sector 7 U.S. government 2.8 9.7 15.1 8.9 11.8 15.8 14.3 6.3 11.5 6.1 17.6 19.2 8 Sponsored credit agencies 21.4 25.6 14.5 20.6 26.9 16.0 13.1 20.0 21.2 26.7 27.2 44.3 9 Monetary authorities 9.2 6.2 8.5 9.8 7.1 7.0 10.1 13.7 6.0 10.2 4.1 12.9 10 Foreign .6 11.2 6.1 15.2 39.5 13.0 -.8 9.7 20.6 26.4 52.7 26.5 11 Agency borrowing not included in line 1.. 19.9 23.1 13.5 18.6 26.3 14.2 12.9 18.2 19.0 25.0 27.5 40.1 Private domestic funds advanced 12 Total net advances 182.0 155.3 167.3 225.7 278.2 129.3 205.4 214.4 237.1 256.8 299.7 308.5 13 U.S. government securities 18.8 22.4 75.7 61.3 44.1 60.2 91.2 67.5 55.1 42.8 45.4 56.4 14 State and local obligations 14.7 16.5 15.6 19.0 29.2 11.1 20.0 19.3 18.7 29.3 29.0 29.0 15 Corporate and foreign bonds 10.0 20.9 32.8 30.5 22.3 40.0 25.6 28.6 32.3 17.2 27.3 21.7 16 Residential mortgages 48.4 26.9 23.2 52.7 83.2 17.1 29.2 45.6 59.7 74.9 91.6 78.0 17 Other mortgages and loans 97.2 75.4 16.1 60.4 103.7 -5.7 37.9 51.9 68.9 96.0 111.5 137.4 18 LESS: FHLB advances 7.2 6.7 -4.0 -2.0 4.3 -6.5 -1.4 -1.5 -2.5 3.4 5.2 14.1 Private financial intermediation 19 Credit market funds advanced by private financial institutions 165.4 126.2 119.9 191.2 249.6 101.2 138.7 174.4 207.9 241.1 258.0 279.8 20 Commercial banking 86.5 64.5 27.6 58.0 85.8 14.8 40.5 46.6 69.4 81.1 90.5 115.8 21 Savings institutions 36.9 26.9 52.0 71.4 84.8 49.3 54.6 70.5 72.4 85.3 84.3 11A 22 Insurance and pension funds 23.9 30.0 41.5 51.7 62.0 38.1 44.9 53.2 50.2 60.3 63.7 69.3 23 Other finance 18.0 4.7 -1.1 10.1 16.9 -.9 -1.3 4.2 15.9 14.5 19.4 17.7 24 Sources of funds 165.4 126.2 119.9 191.2 249.6 101.2 138.7 174.4 207.9 241.1 258.0 279.8 25 Private domestic deposits 86.6 69.4 90.6 121.5 136.0 89.9 91.3 108.3 134.6 127.0 145.0 119.4 26 Credit market borrowing 36.2 13.0 -2.5 9.6 32.0 -2.4 -2.6 10.0 9.2 36.0 28.0 60.3 27 Other sources 42.5 43.8 31.9 60.1 81.6 13.7 50.0 56.1 64.1 78.2 85.1 100.1 28 Foreign funds 5.8 16.8 .9 5.1 11.6 -.5 2.4 .1 9.5 .1 22.4 2.1 29 Treasury balances -1.0 -5.1 -1.7 —. 1 4.3 -3.8 .4 2.3 -2.5 -1.8 10.4 -.8 30 Insurance and pension reserves 18.4 26.0 29.6 34.8 48.0 27.4 31.7 35.8 33.8 45.5 50.4 55.4 31 Other, net 19.4 6.0 3.1 20.3 17.8 -9.4 15.6 17.2 23.4 33.7 1.9 43.4 Private domestic nonfinancial investors 32 Direct tending in credit markets 52.8 42.2 44.9 44.1 60.6 25.7 64.1 50.0 38.4 51.6 69.6 89.0 33 U.S. government securities 19.2 17.5 23.0 19.6 24.6 6.0 39.9 25.0 14.1 14.1 35.2 35.8 34 State and local obligations 5.4 9.3 8.3 6.8 9.1 5.8 10.8 7.6 6.0 8.2 10.1 11.6 35 Corporate and foreign bonds 1.3 4.7 8.0 2.1 1.1 10.7 5.3 2.9 1.3 .4 1.8 -2.5 36 Commercial paper 18.3 2.4 -.8 4.1 9.5 -1.8 .2 4.8 3.4 13.0 6.0 28.6 37 Other 8.6 8.2 6.4 11.5 16.2 4.9 7.8 9.7 13.5 15.9 16.5 17.6 38 Deposits and currency 90.6 75.7 96.8 128.8 144.3 96.4 97.2 114.3 143.3 132.6 156.0 129.5 39 Time and savings accounts 76.1 66.7 84.8 112.2 120.1 75.6 93.9 99.5 125.0 110.5 129.7 110.9 40 Large negotiable CDs 18.1 18.8 -14.1 -14.4 9.3 -27.8 -.3 -19.8 -9.1 -4.4 22.9 11.5 41 Other at commercial banks 29.6 26.1 39.4 58.1 41.7 40.5 38.2 52.0 64.3 45.3 38.2 44.5 42 At savings institutions 28.5 21.8 59.4 68.5 69.1 62.9 56.0 67.3 69.8 69.6 68.7 54.9 43 Money 14.4 8.9 12.0 16.6 24.2 20.8 3.3 14.8 18.3 22.1 26.3 18.6 44 Demand deposits 10.5 2.6 5.8 9.3 15.9 14.3 -2.6 8.9 9.6 16.5 15.3 8.5 45 Currency 3.9 6.3 6.2 7.3 8.3 6.5 5.9 6.0 8.6 5.6 11.0 10.1 46 Total of credit market instruments, deposits and currency 143.4 117.8 141.6 172.9 204.9 122.1 161.3 164.3 181.6 184.2 225.6 218.5 47 Public support rate (in per cent) 17.4 28.5 22.4 20.8 25.3 31.1 16.0 20.2 21.4 23.0 27.2 27.7 48 Private financial intermediation (in per cent) 90.9 81.3 71.7 84.7 89.7 78.3 67.5 81.3 87.7 93.9 86.1 90.7 49 Total foreign funds 6.4 28.0 7.1 20.3 51.1 12.5 1.6 10.4 30.1 27.1 75.1 28.5 MEMO: Corporate equities not included above 50 Total net issues 9.2 4.1 10.7 11.9 3.8 11.1 10.3 13.4 10.4 1.7 5.8 1.1 51 Mutual fund shares -1.2 -.7 —. 1 -1.0 -1.0 .8 -1.0 -2.4 .4 -.8 -1.2 -.6 52 Other equities 10.4 4.8 10.8 12.9 4.8 10.3 11.3 15.8 9.9 2.5 7.0 1.7, 53 Acquisitions by financial institutions 13.3 5.8 9.7 12.5 6.2 11.5 7.8 13.1 12.0 6.1 6.3 1.6 54 Other net purchases -4.1 -1.6 1.0 -.7 -2.4 -.4 2.5 .3 -1.6 -4.4 -.5 -.5 NOTES BY LINE NUMBER. 29. Demand deposits at commercial banks. 1. Line 2 of p. A-44. 30. Excludes net investment of these reserves in corporate equities. 2. Sum of lines 3-6 or 7-10. 31. Mainly retained earnings and net miscellaneous liabilities. 6. Includes farm and commercial mortgages. 32. Line 12 less line 19 plus line 26. 11. Credit market funds raised by federally sponsored credit agencies, 33-37. Lines 13-17 less amounts acquired by private finance. Line 37 and net issues cf federally related mortgage pool securities. Included includes mortgages. below in lines 3, 13, and 33. 45. Mainly an offset to line 9. 12. Line 1 less line 2 plus line 11. Also line 19 less line 26 plus line 32. 46. Lines 32 plus 38, or line 12 less line 27 plus line 45. Also sum of lines 27, 32, 39, and 44. 47. Line 2/line 1. 17. Includes farm and commercial mortgages. 48. Line 19/line 12. 25. Sum of lines 39 and 44. 49. Sum of lines 10 and 28. 26. Excludes equity issues and investment company shares. Includes 50. 52. Includes issues by financial institutions. line 18. NOTE.—Full statements for sectors and transaction types quarterly, 28. Foreign deposits at commercial banks, bank borrowings from foreign and annually for flows and for amounts outstanding, may be obtained branches, and liabilities of foreign banking agencies to foreign af- from Flow of Funds Section, Division of Research and Statistics, Board filiates. of Governors of the Federal Reserve System, Washington, D.C. 20551. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A46 Domestic Nonfinancial Statistics • January 1979 2.10 NONFINANCIAL BUSINESS ACTIVITY Selected Measures 1967 = 100; monthly and quarterly data are seasonally adjusted. Exceptions noted. 1978 Measure 1975 1976 1977 May June July Aug. Sept.r Oct. NOV.P 1 Industrial production 117.8 129.8 137.1 143.9 144.9 146.1 147.1 147.8 148.6 149.5 Market groupings: 2 Products, total 119.3 129.3 137.1 143.1 144.0 145.0 146.2 146.5 146.8 147.8 3 Final, total 118.2 127.2 134.9 140.5 141.1 142.2 143.3 143.7 143.9 144.8 4 Consumer goods 124.0 136.2 143.4 147.0 147.0 147.7 148.4 149.0 149.1 149.8 5 Equipment 110.2 114.6 123.2 131.6 133.0 134.7 136.3 136.4 136.9 137.7 6 Intermediate 123.1 137.2 145.1 152.6 154.7 155.6 156.4 157.0 158.1 159.2 7 Materials 115.5 130.6 136.9 145.1 146.4 147.9 148.6 149.7 151.3 152.2 Industry groupings: 8 Manufacturing 116.3 129.5 137.1 144.3 145.5 146.7 147.6 148.7 149.4 150.3 Capacity utilization (per cent)1 9 Manufacturing 73.6 80.2 82.4 83.9 84.3 84.7 85.0 85.3 85.5 85.7 10 Industrial materials industries 73.6 80.4 81.9 84.5 85.1 85.7 85.9 86.3 87.0 87.4 11 Construction contracts2 162.3 190.2 253.0 332.0 249.0 286.0 289.0 300.0 319.0 285.0 12 Nonagricultural employment, total3 117.0 120.7 125.0 130.1 130.7 130.8 130.9 131.0 131.6 132.3 13 Goods-producing, total 97.0 100.4 104.2 108.7 109.3 109.4 109.2 109.3 110.1 111.0 14 Manufacturing, total 94.2 97.7 101.0 104.4 104.5 104.4 104.3 104.3 105.1 105.9 15 Manufacturing, production-worker 91.2 95.3 98.6 102.1 102.0 101.8 101.6 101.6 102.4 103.5 16 Service-producing 127.9 131.9 136.4 141.9 142.5 142.5 142.8 142.9 143.4 143.9 17 Personal income, total4 200.4 220.4 244.0 268.4 270.6 274.4 276.3 278.4 282.0 284.8 18 Wages and salary disbursements 188.5 208.2 230.1 254.6 256.9 259.2 260.0 262.0 265.9 268.6 19 Manufacturing 157.3 177.1 198.6 220.7 222.3 224.9 224.5 226.4 230.2 234.1 20 Disposable personal income 199.6 217.5 239.3 265.5 267.7 21 Retail sales 5 184.6 203.5 224.4 245.4 246.3 244.9 251.7 253.5 247.5 260.5 Prices:6 22 Consumer7 161.2 170.5 r181.5 193.3 195.3 196.7 197.8 199.3 200.9 23 Producer finished goods 8 163.4 170.3 180.6 193.1 194.5 r196.0 195.3 196.9 199.7 200.6 1 Ratios of indexes of production to indexes of capacity. Based on data 5 Based on Bureau of Census data published in Survey of Current from Federal Reserve, McGraw-Hill Economics Department, and De- Business (U.S. Dept. of Commerce) partment of Commerce. 6 Data without seasonal adjustment, as published in Monthly Labor 2 Index of dollar value of total construction contracts, including Review (U.S. Dept. of Labor). Seasonally adjusted data for changes in residential, nonresidential, and heavy engineering, from McGraw-Hill the price indexes may be obtained from the Bureau of Labor Statistics, Informations Systems Company, F. W. Dodge Division. U.S. Dept. of Labor. 3 The establishment survey data in this table have been revised to con- 7 Beginning Jan. 1978, based on new index for all urban consumers. form to the industry definitions of the 1972 Standard Industrial Classifica- 8 Beginning with the November 1978 BULLETIN, producer price data tion (SIC) Manual and to reflect employment benchmark levels for in this table have been changed to the BLS series for producer finished March 1977. In addition, seasonal factors for these data have been goods. The previous data were producer prices for all commodities. revised, based on experience through May 1978. Based on data in Employment and Earnings (U.S. Dept. of Labor). Series covers employees NOTE.—Basic data (not index numbers) for series mentioned in notes only, excluding personnel in the Armed Forces. 3, 4, and 5, and indexes for series mentioned in notes 2 and 6 may also be 4 Based on data in Survey of Current Business U.S. Dept. of Com- found in the Survey of Current Business (U.S. Dept. of Commerce). merce). Series for disposable income is quarterly. Figures for industrial production for the last 2 months are preliminary and estimated, respectively. 2.11 OUTPUT, CAPACITY, AND CAPACITY UTILIZATION Seasonally adjusted 1978 1978 1978 Series Ql Q2 Q3r Q4 Ql Q2 Q3 Q4 Ql Q2 Q3 r Q4 Output (1967 = 100) Capacity (per cent of 1967 output) Utilization rate (per cent) 1 Manufacturing 139.8 144.4 147.7 150.3 170.3 172.0 173.7 175.4 82.1 84.0 85.0 85.7 2 Primary processing 148.2 154.1 158.2 161.0 176.8 178.5 180.2 181.9 83.8 86.3 87.8 88.6 135.4 139.3 142.1 144.7 166.9 168.5 170.2 171.8 81.1 82.7 83.5 84.2 3 Advanced processing 139.2 145.1 148.7 152.1 170.4 171.7 173.0 174.2 81.7 84.5 86.0 87.3 4 Materials 137.9 144.0 150.4 154.7 174.0 175.2 176.3 177.4 79.3 82.2 85.3 87.2 5 Durable goods 110.5 117.5 124.6 145.8 146.1 146.5 75.8 80.4 85.1 6 Basic metal 158.0 163.2 163.2 166.2 182.3 184.4 186.5 188.5 86.7 88.5 87.5 88.2 7 Nondurable goods 163.1 167.7 168.4 171.1 190.8 193.1 195.4 197.5 85.5 86.8 86.2 86.6 8 Textile, paper, and chemical 115.3 117.1 117.3 143.5 144.1 144.7 80.3 81.2 81.0 9 Textile 136.5 139.7 134.8 153.6 154.8 155.8 88.9 90.3 86.5 10 Paper 194.9 201.4 204.4 226.6 230.1 233.5 86.0 87.5 87.5 11 Chemical 119.1 125.5 127.0 128.6 147.2 147.8 148.4 148.9 80.9 84.9 85.6 86.4 12 Energy Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Labor Market Ml 2.12 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT Thousands of persons; monthly data are seasonally adjusted. Exceptions noted. 1978 CCaatteeggoorryy 11997755 11997766 11997777 June July Aug. Sept. Oct. Nov. Dec. Household survey data 1111 NNNNoooonnnniiiinnnnssssttttiiiittttuuuuttttiiiioooonnnnaaaallll ppppooooppppuuuullllaaaattttiiiioooonnnn1111 153,449 156,048 158,559 160,928 161,148 161,348 161,570 161,829 162,033 162,250 2222 LLLLaaaabbbboooorrrr ffffoooorrrrcccceeee ((((iiiinnnncccclllluuuuddddiiiinnnngggg AAAArrrrmmmmeeeedddd FFFFoooorrrrcccceeeessss))))1111 94,793 96,917 99,534 102,671 102,734 102,672 102,993 103,184 103,764 103,975 3333 CCCCiiiivvvviiiilllliiiiaaaannnn llllaaaabbbboooorrrr ffffoooorrrrcccceeee 92,613 94,773 97,401 100,573 100,618 100,550 100,870 101,062 101,647 95,855 EEEEmmmmppppllllooooyyyymmmmeeeennnntttt:::: 4444 NNNNoooonnnnaaaaggggrrrriiiiccccuuuullllttttuuuurrrraaaallll iiiinnnndddduuuussssttttrrrriiiieeeessss2222 81,403 84,188 87,302 91,346 91,038 91,221 91,457 91,811 92,470 92,468 5555 AAAAggggrrrriiiiccccuuuullllttttuuuurrrreeee 3,380 3,297 3,244 3,473 3,387 3,360 3,411 3,380 3,265 3,387 UUUUnnnneeeemmmmppppllllooooyyyymmmmeeeennnntttt:::: 6666 NNNNuuuummmmbbbbeeeerrrr 7,830 7,288 6,855 5,754 6,193 5,968 6,002 5,870 5,912 6,012 7777 RRRRaaaatttteeee ((((ppppeeeerrrr cccceeeennnntttt ooooffff cccciiiivvvviiiilllliiiiaaaannnn llllaaaabbbboooorrrr ffffoooorrrrcccceeee)))) 8.5 7.7 7.0 5.7 6.2 5.9 6.0 5.8 5.8 5.9 8888 NNNNooootttt iiiinnnn llllaaaabbbboooorrrr ffffoooorrrrcccceeee 58,655 59,130 59,025 58,257 58,414 58,677 58,577 58,645 58,269 58,275 Establishment survey data4 9999 NNNNoooonnnnaaaaggggrrrriiiiccccuuuullllttttuuuurrrraaaallll ppppaaaayyyyrrrroooollllllll eeeemmmmppppllllooooyyyymmmmeeeennnntttt3333 76,945 79,382 82,256 85,996 86,033 86,149 86,163 '86,573 87,020 P87,270 11110000 MMMMaaaannnnuuuuffffaaaaccccttttuuuurrrriiiinnnngggg 18,323 18,997 19,647 20,316 20,302 20,278 20,286 '20,436 20,600 p20,724 11111111 MMMMiiiinnnniiiinnnngggg 752 779 809 879 882 887 887 '893 902 P902 11112222 CCCCoooonnnnttttrrrraaaacccctttt ccccoooonnnnssssttttrrrruuuuccccttttiiiioooonnnn 3,525 3,576 3,833 4,278 4,317 4,298 4,298 '4,341 4,368 p4,413 11113333 TTTTrrrraaaannnnssssppppoooorrrrttttaaaattttiiiioooonnnn aaaannnndddd ppppuuuubbbblllliiiicccc uuuuttttiiiilllliiiittttiiiieeeessss.... 4,542 4,582 4,696 4,881 4,827 4,846 4,855 '4,922 4,945 p4,965 11114444 TTTTrrrraaaaddddeeee 17,060 17,755 18,492 19,412 19,469 19,523 19,546 '19,632 19,697 ^19,687 11115555 FFFFiiiinnnnaaaannnncccceeee........ 4,165 4,271 4,452 4,670 4,690 4,707 4,719 '4,737 4,775 *>4,788 11116666 SSSSeeeerrrrvvvviiiicccceeee 13,892 14,551 15,249 15,963 15,989 16,074 16,127 '16,169 16,261 ?16,296 11117777 GGGGoooovvvveeeerrrrnnnnmmmmeeeennnntttt 14,686 14,871 15,079 15,597 15,557 15,536 15,445 '15,443 15,472 p15,495 1 Persons 16 years of age and over. Monthly figures, which are based unpaid family workers, and members of the Armed Forces. Data are on sample data, relate to the calendar week that contains the 12th day; adjusted to the February 1977 benchmark. Based on data from Employannual data are averages of monthly figures. By definition, seasonality ment and Earnings (U.S. Dept of Labor). does not exist in population figures. Based on data from Employment 4 The establishment survey data in this table have been revised to and Earnings (U.S. Dept. of Labor). conform to the industry definitions of the 1972 Standard Industrial 2 Includes self-employed, unpaid family, and domestic service workers. Classification (SIC) Manual and to reflect employment benchmark 3 Data include all full- and part-time employees who worked during, levels for March 1977. In addition, seasonal factors for these data have or received pay for, the pay period that includes the 12th day of the been revised, based on experience through May 1978. month, and exclude proprietors, self-employed persons, domestic servants, Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A48 Domestic Nonfinancial Statistics • January 1979 2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value Monthly data are seasonally adjusted. 1967 1977 1978 Grouping pro- 1977 por- avertion age Oct. Nov. Dec. May June July Aug. Sept.r Oct. NOV.P Dec.® Index (1967 = 100) MAJOR MARKET 1 Total index 100.00 137.1 138.9 139.3 139.7 143.9 144.9 146.1 147.1 147.8 148.6 149.5 150.4 2 Products 60.71 137.1 138.9 139.5 140.3 143.1 144.0 145.0 146.2 146.5 146.8 147.8 148.8 3 Final products 47.82 134.9 136.5 137.0 137.6 140.5 141.1 142.2 143.3 143.7 143.9 144.8 145.6 4 Consumer goods 27.68 143.4 144.9 145.2 145.8 147.0 147.0 147.7 148.4 149.0 149.1 149.8 150.5 5 Equipment 20.14 123.2 125.0 125.8 126.2 131.6 133.0 134.7 136.3 136.4 136.9 137.7 138.8 6 Intermediate products 12.89 145.1 147.8 148.4 150.4 152.6 154.7 155.6 156.4 157.0 158.1 159.2 160.5 7 Materials 39.29 136.9 138.9 139.0 138.8 145.1 146.4 147.9 148.6 149.7 151.3 152.2 152.9 Consumer goods 8 Durable consumer goods 7.89 153.1 156.8 155.2 155 160.2 160.6 160.9 161.5 160.3 162.0 162.6 162.8 9 Automotive products 2.83 174.2 179.4 173.6 172.4 180.0 179.9 182.2 182.1 178.3 186.2 189.6 186.3 10 Autos and utility vehicles 2.03 169.2 176.1 167.6 165.5 175.6 173.4 176.7 175.6 170.0 181.3 185.7 180.9 11 Autos 1.90 148.4 154.3 147.5 143.6 151.6 149.8 152.7 151.1 144.4 155.0 159.8 151.9 12 Auto parts and allied goods .80 186.8 187.6 188.9 190.4 191.5 193.9 196.1 198.0 199.8 199.1 199.5 200.0 13 Home goods 5.06 141.3 144.2 145.0 146.6 148.9 149.7 148.9 150.0 150.2 148.5 147.6 149.6 14 Appliances, A/C, and TV 1.40 127.3 128.6 131.4 132.8 138.3 139.0 133.7 133.9 134.4 128.7 124.1 127.9 15 Appliances and TV 1.33 130.5 131.6 133.0 134.6 140.7 141.0 136.8 135.6 136.9 129.9 125.2 16 Carpeting and furniture 1.07 152.2 160.5 160.0 161.5 163.4 166.0 168.5 167.9 169.0 169.3 169.4 17 Miscellaneous home goods 2.59 144.3 145.8 146.3 147.7 148.8 148. 149.1 151.3 150.8 150.6 151.4 152.9 18 Nondurable consumer goods 19.79 139.6 140.1 141.2 141.8 141.7 141.6 142.4 143.1 144.4 144.0 144.8 145.5 19 Clothing 4.29 125.2 128.0 126.4 126.9 125.4 124.8 125.1 126.6 128.9 128.3 20 Consumer staples 15.50 143.6 143.5 145.3 145.9 146.2 146.3 147.3 147.8 148.8 148.3 * 148^9 114499..99 21 Consumer foods and tobacco 8.33 135.5 135.2 136.7 137.9 139.9 139.0 140.2 140.8 141.2 140.0 140.9 22 Nonfood staples 7.17 152.9 153.4 155.1 155.2 153.4 154 155.5 155.9 157.4 158.0 158.4 115599..44 23 Consumer chemical products 2.63 180.5 183.7 186.9 186.5 182.0 185.5 186.7 188.0 190.1 191.9 192.5 24 Consumer paper products 1.92 117. 1 117.6 118.5 119. 117.9 118.0 117.5 117.3 118.2 117.0 117.3 25 Consumer energy products 2.62 151.4 149.1 149.9 149.7 150.7 150.8 151.9 152.0 153.3 154.0 154.7 26 Residential utilities 1.45 159.0 155.8 155.6 158.5 157.2 159.0 159.9 160.1 160.9 Equipment 27 Business equipment 12.63 149.2 152.6 153.5 154.0 160.2 161.8 163.8 165.4 165.8 166.9 167.9 169.3 28 Industrial equipment 6.77 138.5 141.8 142.6 143.0 149.7 150.9 151.9 152.8 152.7 153.2 152.9 153.4 29 Building and mining equipment.... 1.44 202.5 205.7 206.7 208.3 226.0 227.3 228.9 228.1 226.3 227.1 225.0 224.2 30 Manufacturing equipment 3.85 113.9 118.5 118.7 118.2 121.3 122.8 122.6 123.9 124.4 125.3 125.1 126.0 31 Power equipment 1.47 140.2 139.8 142.1 143.7 149.2 149.2 152.8 154.6 154.8 154.0 154.4 155.7 32 Commercial transit, farm equipment.. 5.86 161.6 165.1 165.9 166.9 172.3 174.4 177.5 179.9 180.8 182.7 185.3 187.8 33 Commercial equipment 3.26 191.6 195.4 197.4 198.8 204.2 206.9 210.6 212.2 214.1 215.1 216.8 219.3 34 Transit equipment 1.93 117.8 123.3 118.9 121 132.2 132.3 134.9 138.5 138.6 142.3 146.1 114499..55 35 Farm equipment .67 142.3 142.1 147.8 144.5 131.9 137.3 138.5 141.3 142.0 142.2 143.9 36 Defense and space equipment 7.51 79.6 78.9 79.3 79.5 83.6 84.6 85.9 87.1 87.1 86.7 87.1 87.6 Intermediate products 37 Construction supplies 6.42 140.8 144.9 146.5 148.3 150.4 152.1 153.5 154.7 155.6 156.6 157.7 159.1 38 Business supplies 6.47 149.5 150.5 150.1 152.6 155.0 157.0 157.6 158.2 158.4 159.6 160.7 39 Commercial energy products 1.14 164.6 163.0 160.9 165.6 162.7 163.0 164.1 167.4 169.9 170.5 171.0 Materials 40 Durable goods materials 20.35 134.5 137.1 137.2 138.7 143.9 145.4 148.7 150.4 152.1 153.7 154.6 155.8 41 Durable consumer parts 4.58 132.0 135.4 136.5 135.7 137.9 138.7 142.0 142.2 144.8 147.3 147.3 148.3 42 Equipment parts 5.44 143.1 147.6 147.2 149.2 155.8 157.4 161.7 162.9 164.6 166.0 167.3 168.9 43 Durable materials n.e.c 10.34 131.1 132.4 132.3 134.3 140.3 141.8 144.7 147.6 148.7 150.1 151.1 115522..22 44 Basic metal materials 5.57 110.9 110.0 107.9 110.3 117.5 118.2 121.7 125.4 126.7 128.0 129.0 45 Nondurable goods materials 10.47 153.5 154.4 155.4 155.3 163.5 164.1 162.5 162.7 164.4 165.4 166.5 166.8 46 Textile, paper, and chemical materials 7.62 158.3 160.0 159.3 159.3 167.9 168. 168.3 167.0 170.0 170.5 171.4 171.4 47 Textile materials 1.85 113.0 118.5 117.8 117.3 116.7 118.0 117. 1 116.0 118.7 118.7 118.6 48 Paper materials 1.62 133.5 134.4 132.2 130.2 140.1 139.9 135.1 131.5 137.7 137.3 137.3 49 Chemical materials 4.15 188.2 188.5 188.6 189.5 201.7 202.9 204.0 203.7 205.5 206.7 208.2 50 Containers, nondurable 1.70 150.9 148.9 156.7 154.4 161.9 162. 155.4 161.8 161.1 163.4 165.6 51 Nondurable materials n.e.c 1.14 125.3 125.4 128.5 129.9 135.8 135.0 135.7 134.8 131.8 134.3 135.7 52 Energy materials 8.48 122.4 124.0 123.0 118.7 125.2 127.5 127.9 127.0 126.0 128.1 128.6 112299..22 53 Primary energy 4.65 107.3 112.2 111.6 103.0 114.4 116. 116.7 115.4 111.8 116.1 117.0 54 Converted fuel materials 3.82 140.7 138.4 136.9 137.7 138.6 141.4 141.6 141.3 143.4 142.7 142.7 Supplementary groups 55 Home goods and clothing 9.35 133.9 136. 136.5 137.5 138.2 138.3 138.0 139.2 140.3 139.1 139.2 140.6 56 Energy, total 12.23 132.5 133.0 132.3 129.7 134.2 135.9 136.4 136.1 135.9 137.6 138.1 113388..88 57 Products 3.76 155.4 153.3 153.2 154.5 154.3 154.6 155.6 156.7 158.3 159.0 159.7 58 Materials 8.48 122.4 124.0 123.0 118.7 125.2 127.5 127.9 127.0 126.0 128.1 128.6 i29.2 For NOTE see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Output A49 2.13 Continued 1967 1977 1978 Grouping SIC pro- 1977 code por- avertion age Oct. Nov. Dec. May June July Aug. Sept.r Oct. NOV.p Dec.e Index (1967 = 100) MAJOR INDUSTRY 1 Mining and utilities. 12.05 136.2 135.8 135.5 133.9 140.9 142.5 142.6 142.5 142.1 144.1 144.2 144.7 2 Mining 6.36 117.8 119.6 118.8 113.4 126.7 128.0 127.1 126.0 124.1 127.1 127.9 128.0 3 Utilities 5.69 156.5 154.0 154.2 156.7 157.0 158.6 159.9 160.8 162.3 162.4 162.6 163.3 4 Electric 3.88 175.5 173.6 173.3 175.9 177.1 180.1 182.1 183.2 184.4 5 Manufacturing., 87.95 137.1 139.4 139.9 140.5 144.3 145.5 146.7 147.6 148.7 149.4 150.3 151.2 6 Nondurable.. 35.97 148.1 149.6 150.1 150.9 154.0 154.9 155.0 155.6 157.1 157.5 158.1 158.9 7 Durable 51.98 129.5 132.4 132.7 133.4 137.6 139.0 141.1 142.2 142.8 143.9 145.0 145.9 Mining 8 Metal mining 10 .51 105.4 80.0 84.8 104.3 120.0 121.1 117.0 117.9 115.6 122.1 125.3 9 Coal 11, 12 .69 118.0 141.4 140.6 74.6 131.7 136.4 131.7 124.9 114.7 144.0 145.6 147.2 10 Oil and gas extraction 13 4.40 118.0 119.4 117.8 118.4 126.3 127.1 126.8 126.2 124.9 124.7 124.5 124.2 11 Stone and earth minerals. 14 .75 124.9 128.1 127.2 126.5 130.1 130.7 131.3 131.6 133.8 134.0 133.3 Nondurable manufactures 12 Foods 20 8.75 137.9 137.3 139.4 140.4 142.8 141.8 142.9 144.0 144.4 143.5 144.1 13 Tobacco products 21 .67 114.3 113.8 117.5 120.6 120.2 122.7 120.8 118.6 120.6 119.0 14 Textile mill products .. . 22 2.68 137.1 142.4 141.6 143.7 138.5 140.4 141.0 139.5 142.2 142.1 i43.0 15 Apparel products 23 3.31 124.2 129.0 125.1 125.8 125.8 126.8 124.5 127.2 130.9 130.6 16 Paper and products 26 3.21 137.4 137.9 137.8 138.6 146.6 148.0 140.5 141.9 142.3 145.8 U5.3 146.2 17 Printing and publishing 27 4.72 124.9 125.7 126.2 127.5 128.2 128.7 130.3 129.5 131.0 130.3 131.9 132.9 18 Chemicals and products... 28 7.74 180.7 182.3 183.1 183.0 188.1 191.1 192.3 192.2 194.2 195.8 196.8 19 Petroleum products 29 1.79 141.0 141.4 140.5 139.3 143.4 142.8 144.3 144.1 147.1 146.7 147.2 i49!6 20 Rubber & plastic products. 30 2.24 232.2 236.3 238.5 240.1 252.7 255.5 259.1 261.1 263.1 264.1 263.7 21 Leather and products 31 .86 75.3 77.0 78.1 77.3 75.7 75.1 74.5 74.0 74.1 73.8 74.5 Durable manufactures 22 Ordnance, private & government. 19,91 3.64 73.9 74.4 74.1 73.8 74.3 74.7 75.2 75.2 74.3 73.9 73.6 73.8 23 Lumber and products 24 1.64 133.4 135.7 137.5 138.1 136.5 138.7 138.1 136.9 139.2 140.2 141.6 24 Furniture and fixtures 25 1.37 140.9 146.6 146.0 146.6 152.8 156.2 158.1 159.0 160.7 161.3 161.2 25 Clay, glass, stone products 32 2.74 146.1 148.0 152.8 152.1 157.9 159.8 158.8 159.5 160.9 162.1 164.1 26 Primary metals 33 6.57 110.2 113.5 111.2 111.0 115.5 117.5 123.0 126.0 127.9 128.4 128.9 129.3 27 Tron and steel 331, 2 4.21 103.4 107.7 104.3 103.8 110.5 114.5 119.0 120.9 123.2 123.8 123.9 28 Fabricated metal products. 34 5.93 130.9 133.8 135.8 136.4 140.4 142.3 144.0 145.8 146.3 146.3 146.8 147.9 29 Nonelectrical machinery.. . 35 9.15 144.8 148.9 149.7 151.7 152.9 154.6 156.1 157.3 158.7 159.8 160.7 162.2 30 Electrical machinery 36 8.05 141.9 144.2 146.0 147.3 152.9 154.1 157.9 156.9 158.3 157.9 159.2 160.9 31 Transportation equipment 37 9.27 121.1 124.3 122.0 122.2 130.1 130.4 132.1 133.4 132.8 136.9 139.3 138.6 32 Motor vehicles & parts 371 4.50 159.7 168.4 163.0 161.8 168.3 167.7 169.7 171.0 168.9 177.1 181.3 178.5 33 Aerospace & misc. trans, eq., 372-9 4.77 84.7 82.8 83.3 84.9 93.9 95.0 96.5 98.3 98.9 99.2 99.8 101.1 34 Instruments 38 2.11 159.1 162.2 163.1 164.7 169.8 170.9 172.2 175.4 174.6 175.3 177.2 180.1 35 Miscellaneous mfrs 39 1.51 149.1 151.0 151.8 152.5 152.7 153.5 153.2 153.8 154.1 153.9 153.9 155.5 Gross value (billions of 1972 dollars, annual rates) MAJOR MARKET 36 Products, total. 1507.4 583.9 591.3 591.3 594.7 606.8 608.9 610.3 613.3 613.6 621.9 625.8 37 F"i nal • products U90.9 452.1 457.8 457.3 458.7 468.2 468.9 469.6 472.2 471.8 478.3 482.0 38 Consumer goods. 1277.5 317.5 319.5 320.0 320.4 324.0 323.0 323.4 324.7 324.4 327.8 330.8 39 Equipment U13.4 134.6 138.1 137.3 138.2 144.2 146.0 146.4 147.5 147.7 150.6 151.4 40 Intermediate products. U16.6 131.9 133.8 134.1 135.9 138.6 140.3 140.7 141.4 141.9 143.5 143.9 i 1972 dollars. shown separately. For description and historical data, see Industrial Production—1976 Revision (Board of Governors of the Federal Reserve NOTE.—Published groupings include some series and subtotals not System: Washington, D.C.), Dec. 1977. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A50 Domestic Nonfinancial Statistics • January 1979 2.14 HOUSING AND CONSTRUCTION Monthly figures are at seasonally adjusted annual rates except as noted. 1978 Item 1975 1976 1977 May June July' Aug. Sept.' Oct.' Nov. Private residential real estate activity (thousands of units) NEW UNITS 1 Permits authorized 927 1,296 18,133 1,597 1,821 1,632 1,563 1,731 1,719 1,691 2 1-family 669 894 12,265 1,058 1,123 1,035 1,020 1,092 1,127 1,114 3 2-or-more-family 278 402 5,861 539 698 597 543 639 592 577 A Started 1,160 1,538 1,986 2,054 2,124 2,119 2,025 2,075 2,095 2,104 5 1-family 892 1,163 1,451 1,478 1,441 1,453 1,440 1,463 1,459 1,498 6 2-or-more-family 268 377 535 576 683 666 585 612 636 606 7 Under construction, end of period 1,003 1,147 1,442 1,282 1,296 1,298 ' 1,298 1,308 1,326 8 1-family 531 655 829 770 11A 119 786 784 785 9 2-or-more-family All 492 613 513 522 520 '513 524 540 10 Completed 1,297 1,362 1,652 1,854 1,890 1,943 ' 1,967 1,971 11,,884422 11 1-family 866 1,026 1,254 1,426 1,344 1,289 '1,364 11,,444477 11,,339977 12 2-or-more-family 430 336 398 428 546 654 603 552244 445 13 Mobile homes shipped 213 246 111 258 263 232 283 111 300 304 Merchant builder activity in 1-family units: 14 Number sold 544 639 819 846 831 789 '785 793 975 811 15 P N r u ic m e b ( e t r h o f u or s . sa o l f e , d e o n ll d a r o s f ) 2 p eriod1. 383 433 407 412 418 418 '419 420 411 418 Median: 16 Units sold 39.3 44.2 48.9 55.7 56.7 54.8 '56.1 57.5 58.5 58.7 17 Units for sale 38.9 41.6 48.2 Average: 18 Units sold 42.5 48.1 54.4 62.3 63.2 62.9 63.0 64.8 66.1 66.4 EXISTING UNITS (1-family) 19 Number sold 2,452 3,002 3,572 3,770 3,780 3,890 4,080 3,950 4,290 4,350 Price of units sold (thous. of dollars):2 20 Median 35.3 38.1 42.9 47.8 48.4 49.4 50.3 50.2 50.1 50.7 21 Average 39.0 42.2 47.9 54.8 55.1 56.5 57.5 57.7 57.3 57.4 Value of new construction 4 (millions of dollars) CONSTRUCTION 22 Total put in place '134,535 '148,778 '172,552 '201,287 '206,314 210,192 '208,724 209,227 209,874 212,779 23 Private r93,650 '110,416 '134,723 '156,188 '161,064 161,804 '160,562 161,258 161,935 165,477 24 Residential 46,472 60,519 '80,957 '94,275 '95,357 95,888 '95,011 94,249 93,594 95,784 25 Nonresidential, total '47,178 '49,897 '53,766 '61,913 '65,707 65,916 '65,551 67,009 68,341 69,693 Buildings: 26 Industrial 8,017 7,182 '7,713 8,735 11,335 11,170 12,043 12,634 12,627 12,667 27 Commercial 12,804 12,757 '14,789 18,546 19,246 19,463 18,835 18,926 19,410 19,938 28 Other 5,585 6,155 '6,200 6,935 6,761 7,036 6,721 6,686 6,667 6,774 29 Public utilities and other r10,112 '23,803 '25,064 '27,697 '28,365 28,247 '27,952 28,763 29,637 30,314 3 3 3 0 1 2 Pub H M lic i i g li h t w ar a y y ' ' 4 1 ' 0 1 0 ,8 , , 8 3 5 3 9 4 1 8 '3 ' ' 8 1 9 ,3 , , 1 5 4 2 2 3 1 9 '3 ' ' 7 1 9 ,8 , , 2 5 2 8 1 8 7 0 4 1 5 1 0 ,0 , , 4 5 99 4 5 6 6 4 1 5 1 0 ,2 , , 3 3 49 5 3 8 8 48 9 1 ,3 , , 8 4 88 3 9 3 3 '' 11 ''11 11 44 ,, ,, 33 55 44 ,,11 22 22 66 00 77 22 4 1 7 1 0 ,9 , , 6 8 70 1 6 5 2 4 1 7 1 1 ,9 , ,4 4 39 2 4 8 9 47 1 ,3 ,4 03 3 4 3 3 4 3 O Co th n e s r e 3 rv ation and development... '25 3 , , 6 2 8 5 8 6 '2 '3 3 , , 7 6 5 0 1 1 ''22 '3 33 , ,, 8 1144 8 99 2 22 4 88 , ,, 1 9922 7 55 2 33 3 00 , ,, 5 00 0 44 8 55 33 4 22 , ,, 9 00 8 77 9 33 22 55 99 ,, ,, 22 99 33 88 11 44 22 5 99 , ,,88 6 33 6 33 0 33 3 11 , ,, 8 22 5 11 1 11 1 Not at annual rates. NOTE.—Census Bureau estimates for all series except (a) mobile 2 Not seasonally ad justed. homes, which are private, domestic shipments as reported by the Manu- 3 Beginning Jan. 1977 Highway imputations are included in Other. factured Housing Institute and seasonally adjusted by the Census Bureau, 4 Value of new construction data in recent periods may not be strictly and (b) sales and prices of existing units, which are published by the comparable with data in prior periods due to changes by the Bureau of National Association of Realtors. All back and current figures are availthe Census in its estimating techniques. For a description of these changes able from originating agency. Permit authorizations are for 14,000 see Construction Reports (C-30-76-5), issued by the Bureau in July 1976. jurisdictions reporting to the Census Bureau. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Prices A51 2.15 CONSUMER AND PRODUCER PRICES Percentage changes based on seasonally adjusted data, except as noted. 12 months to— 3 months (at annual rate) to— 1 month to— Index level Item 1977 1978 1978 Nov. 1977 1978 1978 Nov. Nov. (1967 Dec. Mar. June Sept. July Aug. Sept. Oct. Nov. = 100)2 Consumer prices3 1 All items 6.7 9.0 4.9 9.3 11.4 7.8 .5 .6 .8 .8 .5 202.0 2 Commodities 6.1 8.4 4.9 9.3 11.2 6.3 .4 .4 .7 .7 .6 192.9 3 Food 8.0 11.3 4.2 16.4 20.4 3.0 .0 .3 .5 .8 .3 217.8 4 Commodities less food 4.9 7.3 5.4 6.1 7.2 7.8 .6 .5 .9 .7 .8 180.3 5 Durable 4.7 8.8 5.2 8.7 9.0 8.3 .7 .5 .9 .8 .8 180.0 6 Nondurable 5.1 5.3 5.1 3.1 5.5 7.3 .5 .5 .8 .5 .6 179.1 7 Services 7.8 9.6 4.9 9.1 11.8 10.3 .8 .8 .8 .8 .4 218.6 8 Rent 6.4 7.3 6.3 6.2 8.5 7.5 .5 .5 .8 .6 .7 168.5 9 Services less rent 8.0 9.9 4.8 9.6 12.2 10.8 .9 .9 .9 .8 .3 227.8 Other groupings: 10 All items less food 6.4 8.4 5.0 8.1 9.3 9.1 .7 .7 .8 .8 ..6 197.8 11 All items less food and energy 6.1 8.6 5.3 8.0 9.9 8.3 .7 .6 .7 .8 .6 195.3 12 Homeownership 8.6 12.9 7.1 12.2 14.5 14.7 1.2 1.0 1.3 1.2 .7 238.8 Producer prices, formerly Wholesale prices 13 Finished goods 7.1 8.7 7.2 9.6 11.4 5.0 .5 r.O .9 .8 200.6 14 Consumer 6.9 9.0 5.4 10.9 12.5 4.2 .5 r — .2 r.S 1.0 .7 198.3 15 Foods 8.3 11.2 7.4 21.2 14.6 -1.0 -.5 -1.4 1.7 1.7 .6 212.0 16 Excluding foods 6.2 7.8 4.7 5.3 11.2 7.6 10 r.5 r.4 .6 .7 189.5 17 Capital Equiptment 7.4 7.9 10.9 7.1 8.7 r6.4 .6 .4 r.5 .6 1.0 205.9 18 Materials 5.5 10.1 8.3 13.9 9.0 5.2 .2 1 .9 1.6 .9 226.5 19 Intermediate! 6.4 8.1 4.2 9.2 6.6 6.7 .4 .6 .6 1.1 .8 222222..77 Crude: 20 Nonfood 1.9 16.6 20.1 16.2 11.6 12.2 2.4 -.5 1.0 2.1 1.8 300.6 21 Food 3.7 19.3 27.6 40.3 28.1 -9.4 -2.5 -1.8 1.9 3.6 1.3 221.3 1 Excludes intermediate materials for food manufacturing and manu- 3 Beginning Jan. 1978 figures for consumer prices are those for all urban factured animal feeds. consumers. 2 Not seasonally adjusted. SOURCE.—Bureau of Labor Statistics. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A52 Domestic Nonfinancial Statistics • January 1979 2.16 GROSS NATIONAL PRODUCT AND INCOME Billions of current dollars except as noted; quarterly data are at seasonally adjusted annual rates. 1977 1978 1975 1976 1977 Account Q2 Q3 Q4 Q1 Q2 Q3r Gross national product 1 Total 1,528.8 1,700.1 1,887.2 1,867.0 1,916.8 1,958.1 1,992.0 2,087.5 2,136.1 By source: 2 3 Per D so u n r al a bl c e o n g s o um od pt s io n expenditures 9 1 7 3 9 2 .1 . 6 1,09 1 0 5 .2 6 .6 1,20 1 6 7 .5 8 .4 1,18 1 8 7 .6 5 .6 1,21 1 4 7 .5 7 .4 1,25 1 5 8 .2 7 .2 1,27 1 6 8 .7 3 .5 1,32 1 2 9 .9 7 .8 1,35 1 6 9 .9 9 .5 4 Nondurable goods 408.9 442.6 479.0 473.6 479.7 496.9 501.4 519.3 531.7 5 Services 437.5 491.0 549.2 539.4 557.5 571.1 591.8 605.8 625.8 6 7 Gro F s i s x e p d r iv i a n te v est d m om e e n st t i c investment 2 19 0 0 1 .9 . 6 2 2 4 3 3 2 .0 . 8 2 29 8 7 2 .8 . 3 2 2 9 7 5 8 .6 . 6 3 2 0 8 9 7 .7 . 8 3 3 1 0 3 0 .5 . 5 3 3 2 0 2 6 .7 . 0 3 3 4 2 5 5 .4 . 3 3 3 5 3 0 6 .1 . 5 9 8 Non S r t e r s u id c e t n u ti r al e s 15 5 0 3 .2 . 8 16 5 4 7 .6 . 3 19 6 0 3 .4 . 9 18 6 7 3 .2 . 4 19 6 3 5 .5 . 4 20 6 0 7 .3 . 4 20 6 5 8 .6 . 5 22 7 0 6 .1 . 6 22 8 7 0 .5 . 9 10 Producers'durable equipment 96.4 107.3 126.5 123.8 128.1 132.8 137.1 143.5 146.6 11 Residential structures 51.5 68.2 91.9 91.4 94.3 100.2 100.3 105.3 109.0 12 Nonfarm 49.5 65.8 88.9 88.4 91.2 97.5 97.3 102.1 105.7 13 Change in business inventories -10.7 10.2 15.6 17.0 21.9 13.1 16.7 20.1 13.6 14 Nonfarm -14.3 12.2 15.0 16.5 22.0 10.4 16.9 22.1 14.6 15 Net exports of goods and services 20.4 7.4 -11.1 -5.9 -7.0 -23.2 -24.1 -5.5 -10.7 16 Exports 147.3 163.2 175.5 178.1 180.8 172.1 181.7 205.4 210.1 17 Imports 126.9 155.7 186.6 184.0 187.8 195.2 205.8 210.9 220.8 1 1 8 9 Gov F e e rn d m e e r n a t l purchases of goods and services 3 1 3 2 8 3 .4 . 1 3 1 5 2 9 9 .5 . 9 3 1 9 4 4 5 .0 . 1 3 1 8 4 8 2 .8 . 9 3 1 9 4 9 6 .5 . 8 4 1 1 5 2 2 .5 . 2 4 1 1 5 6 1 .7 . 5 4 1 2 4 4 7 .7 . 2 4 1 3 5 9 4 .8 . 0 20 State and local 215.4 229.6 248.9 245.9 252.7 260.3 265.2 277.6 285.8 By major type of product: 21 Final sales, total 1,539.6 1,689.9 1,871.6 1,850.0 1,894.9 1,945.0 1,975.3 2,067.4 2,122.5 22 Goods 686.6 760.3 832.6 825.8 844.7 859.6 861.8 912.2 927.3 23 Durable 259.0 304.6 341.3 339.1 346.5 347.4 351.2 375.8 380.1 24 Nondurable 427.5 455.7 491.3 486.7 498.2 512.2 510.6 536.4 547.2 25 Services 697.6 778.0 862.8 850.0 875.3 893.6 926.4 952.0 973.7 26 Structures 144.7 161.9 191.8 191.3 196.8 204.9 203.8 223.4 235.0 27 Change in business inventories -10.7 10.2 15.6 17.0 21.9 13.1 16.7 20.1 13.6 28 Durable goods -8.9 5.3 8.4 9.1 11.9 6.3 14.8 10.8 10.2 29 Nondurable goods -1.8 4.9 7.2 7.6 10.0 6.8 1.9 9.3 3.4 30 MEMO: Total GNP in 1972 dollars 1,202.3 1,271.0 1,332.7 1,325.5 1,343.9 1,354.5 1,354.2 1,382.6 1,391.4 National income 31 Total 1,215.0 1,359,2 1,515.3 1,499.3 1,537.6 1,576.9 1,603.1 1,688.1 1,728.4 32 Compensation of employees 931.1 1,036.8 1,153.4 1,140.5 1,165.8 1,199.7 1,241.0 1,287.8 1,317.1 33 Wages and salaries 805.9 890.1 983.6 973.4 993.6 1,021.2 1,050.8 1,090.2 1,113.4 34 Government and Government enterprises 175.4 187.6 200.8 198.1 201.7 208.1 211.4 213.9 216.8 35 Other 630.4 702.5 782.9 775.3 791.9 813.1 839.3 876.3 896.6 36 Supplement to wages and salaries 125.2 146.7 169.8 167.1 172.2 178.4 190.2 197.6 203.6 37 Employer contributions for social insurance 60.1 69.7 79.4 78.6 79.9 82.4 90.2 93.6 95.7 38 Other labor income 65.1 77.0 90.4 88.5 92.2 96.1 100.0 104.0 107.9 4 4 3 0 9 1 Pro B F pr u a ie r s t i m o n rs e 1 ' ss a i n nc d o m p e r 1 o fessional1 6 2 87 3 3 .0 . . 5 5 7 8 1 8 0 8 .6 . . 2 4 2 9 7 9 0 9 .8 . . 5 3 9 7 2 8 8 0 .9 . . 9 0 9 8 1 7 0 6 .2 . . 8 5 10 2 8 7 5 2 .3 . . 1 3 10 2 8 5 1 3 .0 . . 9 1 11 2 8 0 4 6 .1 . . 1 0 11 2 8 4 5 9 .5 . . 0 6 42 Rental income of persons2 22.4 22.5 22.5 22.4 22.4 22.7 22.8 22.2 24.3 43 Corporate profits1 95.9 127.0 144.2 143.7 154.8 148.2 132.6 163.4 165.2 44 Profits before tax 3 120.4 155.9 173.9 175.1 177.5 178.3 172,1 205.5 205.4 45 Inventory valuation adjustment -12.4 -14.5 -14.8 -16.6 -7.7 -14.8 -23.5 -24.9 -20.9 46 Capital consumption adjustment -12.0 -14.4 -14.9 -14.8 -15.0 -15.3 -16.1 -17.2 -19.3 47 Net interest 78.6 84.3 95.4 93.7 97.3 99.0 101.7 104.6 107.4 1 With inventory valuation and capital consumption adjustments. 3 For after-tax profits, dividends, etc., see Table 1.50. 2 With capital consumption adjustments. SOURCE.—Survey of Current Business (U.S. Dept. of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

National Income Accounts A53 2.17 PERSONAL INCOME AND SAVING Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted. 1977 1978 11997755 11997766 11997777 AAccccoouunntt Q2 Q3 Q4 Ql QQ22 QQ33 rr Personal income and saving 1,255.5 1,380.9 1,529.0 1,508.6 1,543.7 1,593.0 1,628.9 1,682.4 1,731.7 805.9 890.1 983.6 973.4 993.6 1,021.2 1,050.8 1,090.2 1,113.2 3 Commodity-producing industries 275.0 307.5 343.7 342.0 348.3 357.1 365.9 387.0 396.4 211.0 237.5 266.3 264.1 269.3 277.3 286.9 296.1 302.0 5 Distributive industries 195.3 216.4 239.1 236.5 241.2 247.5 257.0 266.4 271.6 6 Service industries 160.1 178.6 200.1 196.8 202.3 208.5 216.5 222.8 228.5 7 Government and government enterprises 175.4 187.6 200.8 198.1 201.7 208.1 211.4 213.9 216.7 8 Other labor income 65.1 77.0 90.4 88.5 92.2 96.1 100.0 104.0 107.9 1 9 0 Pro B pr u ie s t i o n rs e ' ss a i n n d co m p e r 1 ofessional1 6 87 3 .0 .5 7 88 0 .6 .2 7 99 9 .8 .5 9 7 8 8 .9 . 9 9 8 7 0 .2 . 8 10 8 7 2 .3 . 3 10 8 5 3 .0 . 1 11 8 0 6 .1 . 1 11 8 4 9 .5 . 6 11 Farm1 23.5 18.4 20.3 20.0 16.5 25.1 21.9 24.0 25.0 12 Rental income of persons2 22.4 22.5 22.5 22.4 22.4 22.7 22.8 22.2 24.3 13 Dividends 31.9 37.9 43.7 42.7 44.1 46.3 47.0 48.1 50.1 14 Personal interest income 115.5 126.3 141.2 139.1 143.6 146.0 151.4 156.3 161.7 15 Transfer payments 178.2 193.9 208.8 204.0 211.9 215.9 219.2 220.6 230.4 16 Old-age survivors, disability, and health insurance benefits 81.4 92.9 105.0 101.8 108.5 110.1 111122..11 111133..77 112211..11 17 LESS: Personal contributions for social Insurance 50.5 55.5 61.0 60.5 61.4 62.6 6677..22 6699..22 7700..55 18 EQUALS: Personal income 1,255.5 1,380.9 1,529.0 1,508.6 1,543.7 1,593.0 1,628.9 1,682.4 1,731.7 19 LESS: Personal tax and nontax payments.... 168.8 196.5 226.0 223.3 224.6 233.3 237.3 249.1 263.2 20 EQUALS: Disposable personal income 1,086.7 1,184.4 1,303.0 1,285.3 1,319.1 1,359.6 1,391.6 1,433.3 1,468.4 21 LESS: Personal outlays 1,003.0 1,116.3 1,236.1 1,217.8 1,244.8 1,285.9 1,309.2 1,357.0 1,392.5 22 EQUALS: Personal saving 83.6 68.0 66.9 67.5 74.3 73.7 82.4 76.3 76.0 MEMO ITEMS : Per capita (1972 dollars): 5,629 5,906 6,144 6,120 6,191 66,,222266 66,,221155 rr66,,333344 66,,335599 24 Personal consumption expenditures 3,626 3,808 3,954 3,922 3,953 4,030 4,009 4,060 4,091 25 Disposable personal income 4,025 4,136 4,271 4,241 4,293 4,365 4,370 4,399 4,428 26 Saving rate (per cent) 7.7 5.7 5.1 5.3 5.6 5.4 5.9 5.3 5.2 Gross saving 27 Gross private saving 259.8 270.7 290.8 288.6 310.7 304.3 305.4 319.9 325.7 28 Personal saving 83.6 68.0 66.9 67.5 74.3 73.7 82.4 76.3 76.0 29 Undistributed corporate profits1 14.2 24.8 28.7 28.7 38.0 28.0 15.6 30.3 29.0 30 Corporate inventory valuation adjustment.... -12.4 -14.5 -14.8 -16.6 -7.7 -14.8 -23.5 -24.9 -20.9 Capital consumption allowances: 31 Corporate 101.3 111.5 120.9 119.8 122.6 124.6 112277..44 113300..55 113344..77 32 Noncorporate 60.7 66.3 74.3 72.6 75.9 77.9 79.9 82.8 86.1 34 Government surplus, or deficit (—), national -64.4 -33.2 -18.6 -11.8 -25.2 -29.6 -21.1 66..22 ..66 35 Federal -70.6 -53.8 -48.1 -40.3 -56.4 -58.6 -52.6 -23.6 -22.8 36 State and local 6.2 20.7 29.6 28.5 31.2 29.0 31.5 29.8 23.4 37 Capital grants received by the United States, net. 38 Investment 202.8 241.7 276.9 280.4 292.6 279.5 286.4 326.6 326.6 39 Gross private domestic 190.9 243.0 297.8 295.6 309.7 313.5 322.7 345.4 350.1 40 Net foreign 11.9 -1.2 -20.9 -15.2 -17.1 -34.1 -36.3 -18.9 -23.5 41 Statistical discrepancy 7.4 4.2 4.7 3.7 7.1 4.8 2.2 .5 .4 1 With inventory valuation and capital consumption adjustments. SOURCE.—Survey of Current Business (U.S. Dept. of Commerce). 2 With capital consumption adjustment. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A54 International Statistics • January 1979 3.10 U.S. INTERNATIONAL TRANSACTIONS Summary Millions of dollars; quarterly data are seasonally adjusted except as noted, i 1977 1978 Item credits or debits 1975 1976 1977 Q3 Q4 Ql Q2 ' 1 Merchandise exports 107,088 114,694 '120,576 '31,009 '29,461 30,664 35,067 2 Merchandise imports 98,041 124,047 r151,706 '38,277 '39,664 41,865 42,869 3 Merchandise trade balance2. 9,047 -9,353 -31,130 '-7,268 -10,203 -11,201 -7,802 4 Military transactions, net -876 312 1,334 467 5 210 592 5 Investment income, net3 12,795 15,933 17,507 4,609 3,813 4,877 4,583 6 Other service transactions, net. 2,095 2,469 1,705 583 482 538 842 7 Balance on goods and services3,4 23,060 9,361 -10,585 '-1,609 '-5,903 -5,576 -1,785 8 Remittances, pensions, and other transfers... -1,721 -1,878 -1,932 -490 -473 -504 -536 9 U.S. government grants (excluding military). -2,894 -3,145 -2,776 -787 -591 -778 -781 10 Balance on current account3. 18,445 4,339 -15,292 '-2,886 '-6,967 -6,858 -3,102 11 Not seasonally adjusted*.. '-5,796 '-5,245 -6,382 -2,656 12 Change in U.S. government assets, other than official reserve assets, net (increase, —) -3,470 -4,213 -3,679 -1,098 -838 -896 -1,176 13 Change in U.S. official reserve assets (increase, —) -607 -2,530 -231 151 246 329 14 Gold -118 -60 15 Special Drawing Rights (SDRs) -66 -78 -121 -9 -29 -16 -104 16 Reserve position in International Monetary Fund (IMF)., -466 -2,212 -294 133 42 324 437 17 Foreign currencies -75 -240 302 27 47 -62 -4 18 Change in U.S. private assets abroad (increase, — )3. -35,368 -43,865 -30,740 -5,668 -13,862 -14,386 -5,287 19 Bank-reported claims -13,532 -21,368 -11,427 -1,779 -8,750 -6,270 -503 20 Nonbank-reported claims -1,357 -2,030 -1,700 1,389 -1,184 —2,222 267 21 Long-term -366 5 25 205 -279 -57 80 22 Short-term -991 -2,035 -1,725 1,184 -905 -2,165 187 23 U.S. purchase of foreign securities, net. -6,235 -8,852 -5,398 -2,165 -731 -949 -1,103 24 U.S. direct investments abroad, net3... -14,244 -11,614 -12,215 -3,113 -3,197 -4,945 -3,948 25 Change in foreign official assets in the United States (increase, +) 6,907 18,073 37,124 8,246 15,543 15,760 -5,685 26 U.S. Treasury securities 4,408 9,333 30,294 6,948 12,900 12,965 -5,728 27 Other U.S. government obligations 905 573 2,308 627 973 117 211 28 Other U.S. government liabilities5 1,647 4,993 1,644 332 390 804 -312 29 Other U.S. liabilities reported by U.S. banks -2,158 969 773 -163 909 1,456 -493 30 Other foreign official assets6 2,104 2,205 2,105 502 371 418 637 31 Change in foreign private assets in the United States (increase, +)3- 8,643 18,897 13,746 6,005 4,522 2,336 6,090 32 U.S. bank-reported liabilities. 628 10,990 6,719 2,640 3,143 -314 1,836 33 U.S. nonbank-reported liabilities 319 -507 257 590 425 495 248 34 Long-term 406 -958 -620 18 -242 38 -68 35 Short-term -87 451 877 572 667 457 316 36 Foreign private purchases of U.S. Treasury securities, net 2,590 2,783 563 1,251 -299 881 847 37 Foreign purchases of other U.S. securities, net 2,503 1,284 2,869 513 803 462 1,308 38 Foreign direct investments in the United States, net3 2,603 4,347 3,338 1,012 450 812 1,852 39 Allocation of SDRs 40 Discrepancy 9,300 -4,751 '1,602 3,798 8.830 41 Owing to seasonal adjustments -2,229 '2,276 160 42 Statistical discrepancy in recorded data before seasonal adjustment 5,449 9,300 '-927 -2,522 3,638 8.831 MEMO ITEMS: Changes in official assets: 43 U.S. official reserve assets (increase, —) -607 -2,530 -231 151 246 329 44 Foreign official assets in the United States (increase, -f). 5,259 13,080 35,480 7,914 15,153 14,956 -5,373 45 Changes in Organization of Petroleum Exporting Countries (OPEC) official assets in the Unites States (part of line 25 above) 7,092 9,581 6,733 1,438 1,024 1,963 -2,838 46 Transfers under military grant programs (excluded from lines 1, 4, and 9 above) 2,207 373 194 31 711 75 57 1 Seasonal factors are no longer calculated for lines 13 through 46. excludes certain military sales to Israel from exports and excludes U.S. 2 Data are on an international accounts (IA) basis. Differs from the Government interest payments from imports. Census basis primarily because the IA basis includes imports into the 5 Primarily associated with military sales contracts and other transac- U.S. Virgin Islands, and it excludes military exports, which are part of tions arranged with or through foreign official agencies. Line 4. 6 Consists of investments in U.S. corporate stocks and in debt securi- 3 Includes reinvested earnings of incorporated affiliates. ties of private corporations and state and local governments. 4 Differs from the definition of "net exports of goods and services" in the national income and product (GNP) account. The GNP definition NOTE.—Data are from Bureau of Economic Analysis, Survey of Current Business (U.S. Department of Commerce). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Trade and Reserve Assets A55 3.11 U.S. FOREIGN TRADE Millions of dollars; monthly data are seasonally adjusted. 1978 IItteemm 11997755 11997766 11997777 May June July Aug. Sept. Oct. Nov. 1 EXPORTS of domestic and foreign merchandise excluding grant-aid shipments 107,589 115,156 121,151 11,754 12,126 11,793 12,469 13,429 13,011 13,262 2 GENERAL IMPORTS including merchandise for immediate consumption plus entries into bonded warehouses 96,573 121,009 147,685 13,992 13,723 14,779 14,090 15,120 15,138 15,207 3 Trade balance 11,016 -5,853 -26,534 -2,238 -1,597 -2,987 -1,621 -1,691 -2,127 -1,946 NOTE.—Bureau of Census data reported on a free-alongside-ship and are reported separately in the "service account"). On the import (f.a.s.) value basis. Effective January 1978, major changes were made in side, the largest single adjustment is the addition of imports into the coverage, reporting, and compiling procedures. The international- Virgin Islands (largely oil for a refinery on St. Croix), which are not accounts-basis data adjust the Census basis data for reasons of coverage included in Census statistics. and timing. On the export side, the largest adjustments are: (a) the addition of exports to Canada not covered in Census statistics, and (b) the exclusion SOURCE.—FT 900 "Summary of U.S. Export and Import Merchandise of military exports (which are combined with other military transactions Trade" (U.S. Dept. of Commerce, Bureau of the Census). 3.12 U.S. RESERVE ASSETS Millions of dollars, end of period 1978 TTyyppee 11997755 11997766 11997777 June July Aug. Sept. Oct. Nov. Dec.? 1 Total 16,226 18,747 19,312 18,864 18,832 18,783 18,850 18,935 17,967 3 18,650 2 Gold stock, including Exchange Stabilization Fund1 11,599 11,598 11,719 11,706 11,693 11,679 11,668 11,655 11,642 11,671 3 Special Drawing Rights2 2,335 2,395 2,629 2,804 2,860 2,885 2,942 3,097 1,522 31,558 4 Reserve position in International Monetary Fund 2,212 4,434 4,946 4,270 4,177 4,196 4,214 4,147 1,099 31,047 5 Convertible foreign currencies4 80 320 18 84 102 23 26 36 3,704 4 4,374 1 Gold held under earmark at F.R. Banks for foreign and international 3 Beginning July 1974, the IMF adopted a technique for valuing the accounts is not inc'uded in the gold stock of the United States; see Table SDR based on a weighted average of exchange rates for the currencies 3.24. of 16 member countries. The U.S. SDR holdings and reserve position in 2 Includes allocations by the International Monetary Fund (IMF) of the IMF also are valued on this basis beginning July 1974. SDR's as follows: $867 million on Jan. 1, 1970; $717 million on Jan. 1, 4 Beginning November 1978, valued at current market exchange rates. 1971; and $710 million on Jan. 1, 1972; plus net transactions in SDR's. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A56 International Statistics • January 1979 3.13 FOREIGN BRANCHES OF U.S. BANKS Balance Sheet Data Millions of dollars, end of period 1978 Asset account 1975 1976 1977 Apr. May2 June July Aug. Sept. Oct.f All foreign countries 1 Total, all currencies 176,493 219,420 258,897 260,558 259,442 271,696 269,542 275,065 287,369 292,312 2 Claims on United States 6,743 7,889 11,623 13,754 8,727 10,891 9,254 ' 10,154 14,976 12,180 3 Parent bank 3,665 4,323 7,806 9,348 4.863 6,750 5,096 '5,948 10,693 7,901 4 Other 3,078 3,566 3,817 4,406 3.864 4,141 4,158 4,283 4,206 4,279 5 Claims on foreigners 163,391 204,486 238,848 237,447 241,774 251,783 250,700 '254,779 262,063 269,110 6 Other branches of parent bank, 34,508 45,955 55,772 51,817 52,713 55,357 55,236 58,746 63,493 67,634 7 Banks 69,206 83,765 91,883 92,370 91,912 96,638 94,659 92,854 95,222 98,221 8 Public borrowers1 5,792 10,613 14,634 15,207 21,139 '22,654 '23,242 23,311 23,852 23,937 9 Nonbank foreigners 53,886 64,153 76,560 78,053 76,010 r77,134 '77,563 '79,868 79,496 79,318 10 Other assets 6,359 7,045 8,425 9,357 8,941 9,022 9,588 10,132 10,330 11,022 11 Total payable in U.S. dollars 132,901 167,695 193,764 194,168 192,466 202,792 198,205 200,915 212,063 210,939 12 Claims on United States 6,408 7,595 11,049 12,952 8,035 10,107 8,473 9,349 14,168 11,339 13 Parent bank 3,628 4,264 7,692 9,158 4,712 6,580 4,906 5,758 10,535 7,710 14 Other 2,780 3,332 3,357 3,795 3,323 3,527 3,567 3,591 3,633 3,629 15 Claims on foreigners 123,496 156,896 178,896 176,877 180,331 188,590 185,425 187,038 193,457 194,870 16 Other branches of parent bank 28,478 37,909 44,256 40,628 41,209 43,544 43,447 46,326 50,880 52,866 17 Banks 55,319 66,331 70,786 70,504 70,124 74,842 71,592 69,594 71,892 72,667 18 Public borrowers1 4,864 9,022 12,632 13,232 18,275 '19,674 '20,257 20,221 20,474 20,290 19 Nonbank foreigners 34,835 43,634 51,222 52,513 50,723 '50,530 '50,129 50,897 50,211 49,047 20 Other assets 2,997 3,204 3,820 4,339 4,100 4,095 4,307 4,528 4,438 4,730 United Kingdom 21 Total, all currencies. 74,883 81,466 90,933 87,100 89,645 93,538 92,989 93,341 99,084 101,895 22 Claims on United States. 2,392 3,354 4,341 2,506 2,333 3,142 2,615 '2,626 2,940 3,127 23 Parent bank 1,449 2,376 3,518 1,548 1,476 2,279 1,515 '1,597 2,014 2,238 24 Other 943 978 823 958 857 863 1,100 1,029 926 889 25 Claims on foreigners 70,331 75,859 84.016 81,871 84,700 87,808 87,479 '87,769 93,364 95,774 26 Other branches of parent bank. 17,557 19,753 22.017 19,514 19,550 19,944 20,438 21,661 24,691 26,396 27 Banks 35,904 38,089 39,899 40,436 40,807 43,044 42,462 40,401 42,677 44,046 28 Public borrowers1 881 1,274 2,206 2,020 4,150 '4,559 '4,591 4,532 4,505 4,695 29 Nonbank foreigners 15,990 16,743 19,895 19,901 20,193 '20,261 '19,988 '21,175 21,491 20,637 30 Other assets 2,159 2,253 2,576 2,724 2,612 2,588 2,895 2,946 2,780 2,994 31 Total payable in U.S. dollars. 57,361 61,587 66,635 62,330 63,565 67,016 65,452 64,457 70,008 70,217 32 Claims on United States. 2,273 3,275 4,100 2,312 2,163 2,870 2,321 2,337 2,598 2,885 33 Parent bank 1,445 2,374 3,431 1,520 1,452 2,178 1,386 1,483 1,895 2,195 34 Other 828 902 669 793 711 692 935 854 703 690 35 Claims on foreigners 54,121 57,488 61,408 58,845 60,277 63,043 61,938 60,907 66,242 66,132 36 Other branches of parent bank. 15,645 17,249 18,947 16,531 16,406 17,025 17,438 18,305 20,934 21,351 37 Banks 28,224 28,983 28,530 28,177 28,324 30,686 29,455 27,310 29,859 29,706 38 Public borrowers1 648 846 1,669 1,631 3,254 '3,525 '3,626 3,502 3,440 3,586 39 Nonbank foreigners 9,604 10,410 12,263 12,507 12,293 '11,807 '11,419 11,790 12,009 11,489 40 Other assets. 967 824 1,126 1,173 1,125 1,103 1,193 1,213 1,168 1,200 Bahamas and Caymans 41 Total, all currencies. 45,203 66,11A 79,052 84,409 82,083 84,692 82,145 85,654 88,755 86,290 42 Claims on United States. 3,229 3,508 5,782 9,908 5,237 6,441 5,132 5,620 10,053 7,250 43 Parent bank 1,477 1,141 3,051 6,710 2,502 3,449 2,381 2,751 1,090 4,255 44 Other 1,752 2,367 2,731 3,198 2,735 2,992 2,751 2,869 2,963 2,995 45 Claims on foreigners 41,040 62,048 71,671 72,720 74,846 76,282 74,988 77,949 76,651 76,863 46 Other branches of parent bank. 5,411 8,144 11,120 9,565 10,580 10,803 10,292 12,134 12,348 12,618 47 Banks 16,298 25,354 27,939 28,712 29,045 30,307 29,302 29,749 29,472 30,314 48 Public borrowers1 3,576 7,105 9,109 9,362 11,424 12,394 12,599 12,461 12,362 12,092 49 Nonbank foreigners 15,756 21,445 23,503 25,082 23,797 22,778 22,795 23,605 22,469 21,839 50 Other assets 933 1,217 1,599 1,781 2,000 1,969 2,025 2,085 2,051 2,177 51 Total payable in U.S. dollars. 41,887 62,705 73,987 79,324 76,660 79,277 76,494 79,701 83,007 80,222 For notes see opposite page. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Overseas Branches A57 3.13 Continued 1978 LLiiaabbiilliittyy aaccccoouunntt 1975 1976 1977 Apr. May2 June July Aug. Sept. Oct.f All foreign countries 52 Total, all currencies 176,493 219,420 258,897 260,558 259,442 271,696 269,542 275,065 287,369 292,312 53 To United States 20,221 32,719 44,154 49,088 49,907 50,534 r51,583 52,565 49,191 51,548 54 Parent bank 12,165 19,773 24,542 26,643 28,422 25,199 27,722 29,051 24,590 27,617 5 5 6 5 N O o th n e b r a b n a k n s ks in United States... } 8,057 12,946 19,613 22,445 ( \ 12, 9 4 ,0 8 0 2 3 1 1 0 4 , , 3 9 7 6 1 4 r15 8 , , 2 6 5 0 3 8 1 7 5 , , 6 8 5 5 9 5 1 14 0 , , 5 0 3 6 7 4 1 8 5 , , 3 5 6 6 5 6 57 To foreigners 149,815 179,954 206,579 202,946 202,232 213,670 r209,810 213,978 228,866 231,074 58 Other branches of parent bank.. 34,111 44,370 53,244 48,850 50,368 53,547 53,788 56,955 61,599 65,063 59 Banks 72,259 83,880 94,140 91,699 87,567 93.413 88,364 r89,234 97,628 95,955 60 Official institutions 22,773 25,829 28,110 28,568 29,776 31.414 31,831 r31,455 33,077 32,237 61 Nonbank foreigners 20,672 25,877 31,085 33,830 34,521 35,296 r35,827 36,334 36,562 37,819 62 Other liabilities 6,456 6,747 8,163 8,524 7,303 7,492 8,149 8,522 9,312 9,690 63 Total payable in U.S. dollars 135,907 173,071 198,572 197,575 196,746 207,117 r202,407 205,074 215,496 215,503 64 To United States 19.503 31,932 42,881 47,811 48,278 48,820 49,668 50,457 47,037 49,304 65 Parent bank 11;939 19,559 24,213 26,348 27,787 24,477 26,951 28,159 23,640 26,682 6 6 7 6 N O o th n e b r a b n a k n s ks in United States... } 7,564 12,373 18,669 21,463 \ ( 1 8 1, , 7 7 8 0 7 4 1 14 0 , , 2 0 6 7 5 8 r14 8 , , 4 28 3 6 l 1 7 5 , , 2 0 8 1 6 2 1 9 3 , , 7 6 2 7 4 3 1 8 4 , , 0 6 1 1 1 1 6 6 8 9 To O fo t r h ei e g r n e b rs r anches of parent bank.. 11 2 2 8 ,8 ,2 79 1 7 13 3 7 7 ,6 , 1 0 2 9 8 15 4 1 3 ,3 ,2 63 6 8 14 3 5 9 ,3 , 5 2 0 1 4 14 4 4 0 ,7 , 5 0 8 9 9 15 4 4 2 ,5 ,6 13 8 2 r14 4 8 2 ,6 , 3 8 0 5 2 1 r 5 4 0 5 ,4 , 7 6 4 2 0 16 4 3 9 ,7 , 5 9 9 7 8 16 5 1 2 ,4 , 7 0 5 2 2 70 Banks 51,583 60,619 64,872 61,665 57,871 62,434 56,273 55,285 63,270 58,911 71 Official institutions 19,982 22,878 23,972 23,865 25,124 26,587 26,843 r26,178 27,358 26,332 72 Nonbank foreigners 13,097 17,017 19,251 20,606 21,664 22,810 r22,662 23,391 23,153 24,210 73 Other liabilities 3,526 3,527 4,328 4,414 3,710 3,784 4,109 4,143 4,700 4,724 United Kingdom 74 Total, all currencies 74,883 81,466 90,933 87,100 89,645 93,538 92,989 93,341 99,084 101,895 75 To United States 5,646 5,997 7,753 7,266 6,758 8,174 8,011 6,978 8,033 8,386 76 Parent bank 2,122 1,198 1,451 1,983 1,636 1,822 1,959 1,905 1,872 2,174 7 7 7 8 N O o th n e b r a b n a k n s ks in United States.. } 3,523 4,798 6,302 5,283 ( ( 2 2 , , 7 3 7 4 6 6 3 3 , , 2 0 7 7 3 9 2 3 , , 9 0 8 6 7 5 2 2, , 7 2 8 9 3 0 3 3, , 0 1 1 5 1 0 2 3 , , 9 2 4 6 9 3 79 To foreigners 67,240 73,228 80,736 77,169 80,108 82,703 81,847 82,991 87,678 89,901 80 Other branches of parent bank. 6,494 7,092 9,376 8,014 9,009 9,700 10,098 11,708 12,006 12,228 81 Banks 32,964 36,259 37,893 34,940 35,980 36,856 34,662 35,293 37,677 39,276 82 Official institutions 16,553 17,273 18,318 18,817 19,087 20,074 20,863 19,863 21,493 21,193 83 Nonbank foreigners 11,229 12,605 15,149 15,399 16,032 16,073 16,224 16,127 16,502 17,204 84 Other liabilities 1,997 2,241 2,445 2,665 2,779 2,661 3,131 3,372 3,373 3,608 85 Total payable in U.S. dollars 57,820 63,174 67,573 62,662 64,025 67,936 65,671 64,926 70,227 71,166 86 To United States 5,415 5,849 7,480 6,938 6,446 7,852 7,652 6,606 7,650 8,013 87 Parent bank 2,083 1,182 1,416 1,953 1,609 1,794 1,926 1,852 1,805 2,114 8 8 8 9 O No th n e b r a b n a k n s ks in United States.. } 3,332 4,667 6,064 4,985 \ ( 2, 2 5 ,2 5 8 6 1 2 3 , , 8 17 8 6 2 2 2 , , 9 8 0 2 4 2 2 2 , , 2 54 0 5 9 3 2, , 7 0 5 9 3 2 2 2, , 9 9 9 0 7 2 90 To foreigners 51,447 56,372 58,977 54,498 56,274 58,856 56,636 57,015 61,231 61,735 91 Other branches of parent bank. 5,442 5,874 7,505 6,202 6,696 7,259 7,696 9,163 9,317 9,271 92 Banks 23,330 25,527 25,608 22,115 22,554 23,472 20,527 20,601 22,936 23,259 93 Official institutions 14,498 15,423 15,482 15,672 15,908 16,866 17,397 16,113 17,659 17,106 94 Nonbank foreigners 8,176 9,547 10,382 10,509 11,116 11,259 11,016 11,138 11,319 12,099 95 Other liabilities 959 953 1,116 1,227 1,305 1,228 1,383 1,305 1,346 1,418 Bahamas and Caymans 96 Total, all currencies 45,203 66,774 79,052 84,409 82,083 84,692 82,145 85,654 88,755 86,290 97 To United States 11,147 22,721 32,176 37,256 37,350 35,185 r37,041 39,532 34,244 35,679 98 Parent bank 7,628 16,161 20,956 22,289 23,255 19,078 21,755 23,187 18,410 20,179 1 9 0 9 0 N O o th n e b r a b n a k n s ks in United States.. } 3,520 6,560 11,220 14,967 ( ( 8 5 ,4 ,6 7 2 0 5 1 5 0 , , 5 5 1 9 4 3 '1 4 0 , , 5 6 8 9 7 9 1 4 1 , , 5 8 0 3 9 6 1 5 0 , , 5 3 1 2 1 3 1 4 1 , , 4 0 1 8 8 2 101 To foreigners 32,949 42,899 45,292 45,610 43,394 48,088 r43,649 44,597 52,707 48,955 102 Other branches of parent bank... 10,569 13,801 12,816 10,288 11,250 11,657 11,165 11,436 14,762 15,635 103 Banks 16,825 21,760 24,717 25,847 21,452 25,752 21,951 21,884 27,371 22,471 104 Official institutions 3,308 3,573 3,000 3,489 4,419 4,583 4,221 4,598 4,468 4,440 105 Nonbank foreigners 2,248 3,765 4,759 5,986 6,273 6,096 r6,312 6,679 6,106 6,409 106 Other liabilities 1,106 1,154 1,584 1,543 1,339 1,419 1,455 1,525 1,804 1,656 107 Total payable in U.S. dollars 42,197 63,417 74,463 80,243 78,254 80,650 78,131 81,314 84,317 81,323 i In May 1978 a broader category of claims on foreign public borrowers, 2 In May 1978 the exemption level for branches required to report including corporations that are majority owned by foreign governments, was increased, which reduced the number of reporting branches, replaced the previous, more narrowly defined claims on foreign official institutions. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A58 International Statistics • January 1979 3.14 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS Millions of dollars, end of period 1978 IItteemm 11997755 11997766 11997777 May June July Aug. Sept. Oct.f Nov.*5 A. By type 1111 TTTToooottttaaaallll iiii 82,572 95,634 131,090 140,955 140,571 144,138 146,084 145,210 152,856 156,850 2222 LLLLiiiiaaaabbbbiiiilllliiiittttiiiieeeessss rrrreeeeppppoooorrrrtttteeeedddd bbbbyyyy bbbbaaaannnnkkkkssss iiiinnnn tttthhhheeee UUUUnnnniiiitttteeeedddd SSSSttttaaaatttteeeessss2222 16,262 17,231 18,003 19,054 18,808 19,445 20,049 19,752 22,696 21,988 3333 UUUU....SSSS.... TTTTrrrreeeeaaaassssuuuurrrryyyy bbbbiiiillllllllssss aaaannnndddd cccceeeerrrrttttiiiiffffiiiiccccaaaatttteeeessss3333 34,199 37,725 47,820 56,447 55,594 56,842 56,299 55,014 57,976 62,943 UUUU....SSSS.... TTTTrrrreeeeaaaassssuuuurrrryyyy bbbboooonnnnddddssss aaaannnndddd nnnnooootttteeeessss:::: 4444 MMMMaaaarrrrkkkkeeeettttaaaabbbblllleeee 6,671 11,788 32,157 32,314 32,836 34,149 34,860 35,564 36,141 36,210 5555 NNNNoooonnnnmmmmaaaarrrrkkkkeeeettttaaaabbbblllleeee4444 19,976 20,648 20,443 19,355 19,284 19,214 20,375 20,304 21,426 20,993 6666 UUUU....SSSS.... sssseeeeccccuuuurrrriiiittttiiiieeeessss ooootttthhhheeeerrrr tttthhhhaaaannnn UUUU....SSSS.... TTTTrrrreeeeaaaassssuuuurrrryyyy sssseeeeccccuuuurrrriiiittttiiiieeeessss5555 5,464 8,242 12,667 13,785 14,049 14,488 14,501 14,576 14,617 14,716 B. By area 7777 TTTToooottttaaaallll 82,572 95,634 131,090 140,955 140,571 144,138 146,084 145,210 152,856 156,850 8888 WWWWeeeesssstttteeeerrrrnnnn EEEEuuuurrrrooooppppeeee1111 45,701 45,882 70,748 72,777 74,455 75,739 79,723 80,267 85,302 88,903 9999 CCCCaaaannnnaaaaddddaaaa 3,132 3,406 2,334 2,680 2,593 2,490 2,071 1,497 2,618 2,446 11110000 LLLLaaaattttiiiinnnn AAAAmmmmeeeerrrriiiiccccaaaa aaaannnndddd CCCCaaaarrrriiiibbbbbbbbeeeeaaaannnn 4,461 4,926 4,649 5,425 4,668 4,629 4,621 3,898 4,611 4,495 11111111 AAAAssssiiiiaaaa 24,411 37,767 50,693 57,219 56,199 58,081 56,848 56,808 57,407 57,918 11112222 AAAAffffrrrriiiiccccaaaa 2,983 1,893 1,742 1,945 1,689 2,220 2,036 2,006 2,184 2,301 11113333 OOOOtttthhhheeeerrrr ccccoooouuuunnnnttttrrrriiiieeeessss6666 1,884 1,760 924 909 967 979 785 734 734 787 1 Includes the Bank for International Settlements. 5 Debt securities of U.S. Govt, corporations and Federally sponsored 2 Principally demand deposits, time deposits, bankers acceptances, agencies, and U.S. corporate stocks and bonds. commercial paper, negotiable time certificates of deposit, and borrowings 6 Includes countries in Oceania and Eastern Europe. under repurchase agreements. 3 Includes nonmarketable certificates of indebtedness (including those NOTE.—Based on Treasury Dept. data and on data reported to the payable in foreign currencies through 1974) and Treasury bills issued to Treasury Dept. by banks (including Federal Reserve Banks) and securities official institutions of foreign countries. dealers in the United States. 4 Excludes notes issued to foreign official nonreserve agencies. Includes For a description of the changes in the International Statistics tables, bonds and notes payable in foreign currencies. see July 1978 BULLETIN, p. 612. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A59 3.15 LIABILITIES TO FOREIGNERS Reported by Banks in the United States Payable in U.S. dollars Millions of dollars, end of period 1978 Item 1975 1976 1977 May June I July Aug. Sept. Oct.^ Nov.f A. By holder and type of liability 1 All foreigners 95,590 110,657 126,168 137,133 135,926 137,293 140,532 144,084 150,872 158,373 2 Banks' own liabilities. 61,315 60,671 61,429 63,931 68,488 71,391 74,860 3 Demand deposits... 13,564 16,803 18,996 17,823 17,189 17,953 16,104 17,204 17,557 18,264 4 Time deposits1 10,267 11,347 11,521 11,542 11,635 11,921 12,634 12,503 12,308 12,514 5 Other2 7,156 6,477 6,876 7,238 6,697 10,260 8,737 6 Own foreign offices 3 24,795 25,369 24,679 27,955 32,085 31,267 35,346 7 Banks' custody liabilities4 75,818 75,255 75,864 76,601 75,596 79,482 83,513 8 U.S. Treasury bills and certificates5 37,414 40,744 48,906 58,260 57,126 57,629 57,264 56,665 59,077 63,434 9 Other negotiable and readily transferable instruments6 14,958 15,506 15,512 16,691 16,057 17,619 17,683 10 Other 2,600 2,623 2,722 2,646 2,874 2,786 2,397 11 Nonmonetary international and regional organizations7 5,699 5,714 3,274 3,129 2,942 2,678 2,823 3,406 2,929 2,190 12 Banks' own liabilities. 501 480 1,017 808 767 336 417 13 Demand deposits... 139 290 231 286 265 257 142 144 133 153 14 Time deposits1 148 205 139 61 119 116 97 99 116 102 15 Other2 154 97 644 569 523 87 161 16 Banks' custody liabilities4 2,627 2,462 1,662 2,014 2,639 2,593 1,774 17 U.S. 1 reasury bills and certificates 2,554 2,701 706 1,153 922 228 368 1,036 403 183 18 Other negotiable and readily transferable instruments6 1,473 1,537 1,432 1,645 1,603 2,189 1,590 19 Other 1 3 1 1 20 Official institutions8 . 50,461 54,956 65,822 75,501 74,402 76,286 76,348 74,766 80,663 84,623 21 Banks' own liabilities. 9,017 8.453 9,422 9,085 9,455 11,870 10,820 22 Demand deposits... 2,644 3,394 3,528 3.092 2,611 3,473 2,643 3,307 3,046 3,414 23 Time deposits1 3,423 2,321 1,797 1,982 1,981 2,277 2,595 2,563 2,399 2,345 24 Other2 3,943 3,862 3,673 3,848 3,585 6,426 5,060 25 Banks' custody liabilities4 66,483 65,949 66.864 67,263 65,311 68,793 73,803 26 U.S. Treasury bills and certificates5 34,199 37,725 47,820 56,447 55,594 56,842 56,299 55,014 57,967 62,635 27 Other negotiable and readily transferable instruments6 9,453 9,857 9,498 10,326 9,703 10,616 11,062 28 Other 583 498 524 638 594 210 107 29 Banks 9 29,330 37,174 42,335 43,338 43,363 42,921 45,532 50,410 51,243 54,934 30 Banks' own liabilities 38,960 38,824 38,358 41,028 45,640 46,288 50,133 31 Unaffiliated foreign banks. 14,165 13,454 13,680 13,073 13,555 15.022 14,788 32 Demand deposits 7,534 9,104 10,933 10,338 10,164 10,240 9.229 9,713 10,156 10,068 33 Time deposits1 1,873 2,297 2,040 1,325 1,255 1,321 1,390 1,618 1,552 1,735 34 Other2 2,502 2,035 2,119 2,454 2,223 3,315 2,985 35 Own foreign offices3. 24,795 25,369 24,679 27,955 32,085 31,267 35,346 36 Banks' custody liabilities4 4,378 4,540 4,562 4,504 4,771 4,955 4,801 37 U.S. Treasury bills and certificates 335 119 141 363 300 269 296 307 381 371 38 Other negotiable and readily transferable instruments6 2,251 2,355 2,416 2.381 2,534 2,447 2,528 39 Other 1,764 1,885 1,877 1,828 1,930 2,126 1,902 40 Other foreigners. 10,100 12,814 14,736 15,166 15,218 15,407 15,829 15,502 16,037 16,625 41 Banks' own liabilities. 12.836 12,914 12,631 13,009 12,627 12,896 13,490 42 Demand deposits... 3,248 4,015 4,304 4,106 4,149 3,983 4,090 4,039 4,222 4,628 43 Time deposits1 4,823 6,524 7,546 8,173 8,281 8,208 8,552 8,222 8,242 8,331 44 Other2 557 484 441 368 365 433 531 45 Banks' custody liabilities4 2,330 2,304 2,776 2,819 2,875 3,141 3,135 46 U.S. Treasury bills and certificates 325 198 240 297 310 290 301 308 326 245 47 Other negotiable and readily transferable instruments6 1,780 1,757 2,165 2,339 2,218 2,367 2,503 48 Other 253 237 320 179 349 448 387 49 MEMO: Negotiable time certificates of deposit held in custody for foreigners 9,290 9,428 9,385 9,964 9,822 10,977 10,823 1 Excludes negotiable time certificates of deposit, which are included 6 Principally bankers acceptances, commercial paper, and negotiable in "Other negotiable and readily transferable instruments." time certificates of deposit. 2 Includes borrowings under repurchase agreements. 7 Principally the International Bank for Reconstruction and Develop- 3 U.S. banks: includes amounts due to own foreign branches and ment, and the Inter-American and Asian Development Banks. foreign subsidiaries consolidated in "Consolidated Report of Condition" 8 Foreign central banks and foreign central governments and the filed with bank regulatory agencies. Agencies, branches, and majority- Bank for International Settlements. owned subsidiaries of foreign banks: principally amounts due to head 9 Excludes central banks, which are included in "Official institutions." office or parent foreign bank, and foreign branches, agencies or whollyowned subsidiaries of head office or parent foreign bank. NOTE.—Data for time deposits prior to April 1978 represent short- 4 Financial claims on residents of the United States, other than long- term only. term securities, held by or through reporting banks. For a description of the changes in the International Statistics Tables, 5 Includes nonmarketable certificates of indebtedness (including those see July 1978 BULLETIN, p. 612. payable in foreign currencies through 1974) and Treasury bills issued to official institutions of foreign countries. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A60 International Statistics • January 1979 3.15 Continued 1978 Item 1975 1976 1977 May June July Aug. Sept. Oct.2* Nov.*5 B. By area and country 1 Total 95,590 110,657 126,168 137,133 135,926 137,293 140,532 144,084 150,872 158,373 2 Foreign countries. 89,891 104,943 122,893 134,005 132,983 134,615 137,709 140,678 147,943 3 Europe 44,072 47,076 60,295 62,984 64,302 64,662 67,339 69,099 73,367 4 Austria 759 346 318 352 351 372 424 431 473 Belgium-Luxembourg... 2,893 2,187 2,531 2,893 2,756 2,277 2,174 2,368 2,464 Denmark 329 356 770 1,110 1,335 1,542 1,593 1,673 1,734 Finland 391 416 323 396 352 407 416 415 424 France 7,726 4.876 5,269 6,276 6,550 7,353 7,989 8,060 8,402 Germany 4,543 6,241 7,239 9,537 10,029 9,727 10,766 11,206 13,374 Greece 284 403 603 563 597 646 826 865 887 Italy 1,059 3,182 6,857 6,364 6,869 7,036 8,055 7,394 7,346 Netherlands 3,407 3,003 2,869 2,993 3,118 3,078 3,240 2,756 2,523 Norway 994 782 944 1,643 1,869 1,737 1.516 1,208 1,210 Portugal 193 239 273 288 191 227 324 521 386 Spain 423 559 619 717 688 709 752 765 702 Sweden 2,277 1,692 2,712 3,302 3.385 3,340 3,355 3,341 3,187 Switzerland 8,476 9,460 12,343 12,534 12,415 11,888 12,102 13,077 14,262 Turkey 118 166 130 200 110 147 137 226 164 United Kingdom 6,867 10,018 14,125 11,609 11,471 11,770 10,956 11,802 12,438 Yugoslavia 126 189 232 168 229 192 149 167 158 Other Western Europe i. 2,970 2,673 1,804 1,731 1,666 1,935 2,311 2,497 2,887 O U t .S he .S r .R E astern Europe2. 1 4 9 0 7 23 5 6 1 23 9 6 8 2 9 1 6 1 2 6 5 6 5 22 5 2 5 ! 2 4 1 6 0 2 6 6 5 2 26 8 2 2 24 Canada. 2,919 4,659 4,607 6,600 5,816 5,623 5,890 5,122 7,418 25 Latin America and Caribbean 15,028 19,132 23,670 25,049 25,425 24,831 27,259 29,284 28,466 26 Argentina 1,146 1,534 1,416 2,260 1,692 1,550 1,453 1,393 1,650 27 Bahamas 1,874 2,770 3,596 3,327 3,954 3,629 4,601 7,249 4,877 28 Bermuda 184 218 321 339 396 383 372 409 387 29 Brazil 1,219 1,438 1,396 1,298 1,220 1,295 1,382 1,350 1,441 30 British West Indies 1,311 1.877 3,998 3,949 4,769 4,009 5,474 5,380 5,916 31 Chile 319 337 360 361 376 380 346 351 333 32 Colombia 417 1,021 1,221 1,300 1,424 1,429 1,486 1,431 1,483 33 Cuba 6 6 6 7 7 9 10 7 7 3 3 3 4 6 5 J E G a c u m u a a a t d e ic o m a r a 3 la3 120 320 330 3 5 4 1 5 6 8 2 4 3 6 4 2 6 8 5 4 3 1 7 7 5 5 8 4 3 1 4 5 9 7 9 4 3 0 7 4 5 8 7 3 3 6 5 6 9 7 8 4 4 4 4 3 3 3 3 0 1 2 7 8 9 O P V N P M U e a e e t r e r h n n t u u x h e a e g i r e z m c u r u o L a a l e a y a l n a ti d n s A A m nt e i r l i l c e a s4 and Caribbean. 2 3 1 1 , , , , 0 3 3 1 2 1 1 7 9 0 1 4 2 7 0 3 9 5 3 9 2 2 3 1 1 , , , , 8 1 7 1 2 2 1 7 9 6 1 5 4 5 0 7 7 8 7 5 8 2 2 2 2 , , , , 3 8 1 9 2 2 1 3 6 7 2 8 4 9 1 7 6 9 7 3 6 2 2 3 1 , , , , 9 6 2 6 2 2 2 0 9 7 4 7 0 8 9 8 0 3 4 8 9 2 2 3 1 , . , , 7 3 1 6 2 2 3 7 8 5 0 8 2 2 6 6 7 6 2 0 0 2 2 3 1 , , , , 9 6 2 5 4 2 3 2 3 2 3 3 1 0 1 9 9 0 5 9 8 2 3 3 1 , , , . 1 6 2 5 2 3 1 7 2 0 1 1 8 8 1 8 8 7 1 8 5 2 2 3 1 , , , , 7 5 6 1 3 3 1 4 3 6 1 2 1 9 1 7 0 2 1 7 7 2 3 3 1 , , , , 3 1 6 4 2 3 3 0 9 9 9 1 2 5 1 6 6 8 0 3 3 4 4 4 4 4 4 5 5 5 5 5 5 5 4 8 9 5 6 7 1 4 5 6 0 2 3 Asi I I I K T C H P C J M a O n s n a h h h h r o t o d d i p h i a a i i d r n l i o n n a e e i a i e d g l n n p a r l a a a l , , e p e K n A s i R P d i n E o s a e e e i n a a o s p g s p u t l b e o l ' i s i l c - e R o x e f p p o ( u T r b t a i l i n i w c g a o c n f o ) u (M nt a ri i e n s l a 5 n d). 2 1 2 7 0 1 , , 3 , , 3 2 0 8 2 7 3 8 6 3 3 1 1 5 4 0 2 5 0 8 5 0 6 9 1 2 5 7 5 2 0 7 6 5 9 0 5 3 2 1 9 9 1 4 , , , , 3 3 3 2 6 4 6 9 8 3 3 7 6 9 6 7 3 3 2 4 9 9 9 4 6 0 8 3 7 8 8 8 8 0 4 2 0 6 3 1 0 8 1 1 4 1 ,4 , , , , , 9 2 6 0 0 8 6 2 9 6 4 5 8 7 1 5 1 9 6 8 6 0 1 5 5 9 6 0 3 4 1 7 4 2 0 9 3 3 1 5 8 9 1 1 1 ,4 , , , , , 7 0 2 4 0 6 9 4 6 5 8 3 3 3 5 8 8 6 4 5 6 1 8 6 0 1 9 5 9 7 1 2 7 8 8 4 0 3 1 3 7 1 1 1 9 , , 6 , , , , 8 0 0 2 0 6 4 2 7 8 5 3 5 9 8 5 1 2 9 7 4 9 9 5 3 4 5 3 3 0 7 6 8 5 9 3 0 2 35 7 0 1 1 1 , , 1 , , , , 2 3 1 1 5 7 7 7 5 6 5 3 6 9 1 7 9 1 4 9 9 1 4 1 2 7 1 4 5 1 0 8 7 4 0 9 0 3 1 3 6 1 1 9 1 ,4 , , , , , 7 2 7 3 6 2 7 7 2 4 5 3 1 3 5 1 6 6 6 9 3 4 6 4 0 5 9 4 4 2 6 6 2 6 0 9 3 1 3 6 1 1 1 9 ,4 , , , , , 3 3 2 8 2 3 l 6 2 8 4 3 8 4 5 i 9 3 8 4 2 3 9 4 3 1 0 e 0 0 6 3 3 0 0 8 2 3 1 4 6 9 1 1 1 ,9 , , , , , 9 9 3 3 6 7 4 7 8 5 5 3 3 1 0 1 4 8 4 9 5 7 8 5 9 1 1 8 8 0 9 9 3 5 4 2 4 6 6 6 6 5 5 5 7 3 0 1 2 8 9 Afr S O O E Z M ic o a g a i t o l u h i y - r r t e e p e h o r x t c p A A c o o f f r r r t i i i c c n a a g countries6. 3 2 , , 3 2 4 6 3 1 4 9 9 6 6 4 6 0 1 2 8 2 6 2 1 ,2 ,1 5 3 9 1 1 3 8 8 8 4 3 3 6 7 5 1 6 2 1 , , 5 1 4 6 3 1 5 5 9 6 0 3 7 5 8 6 4 9 4 2 1 ,6 ,2 4 6 4 1 4 3 6 7 2 4 8 4 1 6 9 9 5 2,3 4 9 6 2 60 8 7 2 4 0 2 1 9 8 4 2 6 3 1 , , 0 3 7 5 1 1 6 3 7 2 7 9 7 5 8 8 3 4 5 2 1 , , 5 1 4 6 7 1 9 8 3 6 6 5 6 8 8 3 7 2 0 2 1 , , 6 2 6 4 2 4 7 5 0 1 3 7 4 0 1 7 8 4 5 2 1 ,5 ,2 6 2 4 3 3 0 2 0 6 8 3 2 0 0 6 4 9 6 6 6 4 5 6 Oth A A er l u l st o r t a h c l e o i r a u ntries.. 2 2 , , 1 0 1 1 0 9 1 6 3 2 1 , , 0 9 1 1 0 0 2 5 7 1 1 , , 2 1 9 1 4 7 5 0 8 1 1 , , 2 1 6 1 2 7 3 9 8 1 1 , , 4 2 2 1 1 0 4 1 3 1 1 , , 3 1 1 1 5 5 5 8 7 1 1 , , 1 0 1 8 5 3 0 1 0 1,0 8 1 9 9 9 0 9 1 1,1 9 2 8 7 1 9 5 3 67 Nonmonetary international and regional organizations 5,699 5,714 3,274 3,129 2,942 2,678 2,823 3,406 2,929 6 6 7 9 8 0 I O L n a t t h t e i e r n r n A a r t e m i g o e i n o r a n i l c a a l7 n regional. 5,4 1 1 9 8 5 6 8 5,1 2 2 5 6 9 7 7 0 2,7 2 2 5 7 4 2 8 5 2,4 4 2 3 3 6 0 0 9 2,3 2 3 1 3 9 1 6 5 2,0 4 2 2 1 4 7 1 1 2,1 4 2 5 3 2 7 7 8 2,3 7 2 3 9 6 9 9 9 1,7 8 2 8 5 8 9 6 4 c!ud®s the Bank for International Settlements. Beginning April 6 Comprises Algeria, Gabon, Libya, and Nigeria. 1978, also includes Eastern European countries not listed in line 23 7 Asian, African, Middle Eastern, and European regional organizations, 2 Beginning April 1978 comprises Bulgaria, Czechoslovakia, German except the Bank for International Settlements, which is included in "Other Western Europe." Democratic Republic, Hungary, Poland, and Romania. 1978IndUded ^ "°ther Latin America and Caribbean" through March NOTE.—For a description of the changes in the International Statistics 4 Includes Surinam through December 1975. tables, see July 1978 BULLETIN, p. 612. s Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A61 3.16 BANKS' OWN CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1978 Area and country 1975 1976 1977 May June July Aug. Sept. Oct.f NOV.P 1 Total 58,308 79,301 90,206 87,832 87,212 87,349 91,844 94,399 96,527 104,975 2 Foreign countries. 58,275 79,261 90,163 87,797 87,180 87,313 91,806 94,360 96,487 104,933 3 Europe 11,109 14,776 18,114 15,811 16,249 15,762 16,829 18,301 1199,,119977 20,459 4 Austria 35 63 65 94 105 116 107 95 111111 143 5 Belgium-Luxembourg 286 482 561 793 731 634 823 949 1,036 1,222 6 Denmark 104 133 173 185 145 129 146 147 160 193 7 Finland 180 199 172 184 182 190 216 221 232 260 8 France 1,565 1,549 2,082 1,679 1,891 1,813 2,523 2,786 2,708 2,705 9 Germany 380 509 644 751 787 689 632 742 808 838 10 Greece 290 279 206 279 204 190 125 126 161 134 11 Italy 443 993 1,334 1,184 965 1,078 1,027 1,016 1,353 1,452 12 Netherlands 305 315 338 468 383 436 405 379 494 602 13 Norway 131 136 162 209 217 210 163 263 238 282 14 Portugal 30 88 175 132 126 140 105 99 106 180 15 Spain 424 745 722 699 706 669 714 770 927 981 16 Sweden 198 206 218 184 219 244 290 325 348 465 17 Switzerland 199 379 564 390 685 631 1,013 871 781 1,045 18 Turkey 164 249 360 306 309 313 305 305 293 283 19 United Kingdom 5,170 7,033 8,964 6,951 7,270 6,961 6,933 7,827 8,000 8,324 20 Yugoslavia 210 234 311 285 320 300 280 306 293 302 21 Other Western Europe i 76 85 86 137 153 165 125 128 147 115 22 U.S.S.R 406 485 413 362 319 305 343 370 387 321 23 Other Eastern Europe2 513 613 566 536 534 548 553 575 617 612 24 Canada. 2,834 3,319 3,355 2,412 2,493 3,116 3,343 3,448 3,584 4,537 25 Latin America and Caribbean 23,863 38,879 45,850 46,942 45,990 46,974 49,469 50,397 49,215 54,299 26 Argentina 1,377 1,192 1,478 1,595 1,556 1,572 1,566 1,690 1,448 1,698 27 Bahamas 7,583 15,464 19,858 21,041 18,725 19,643 22,172 20,031 19,205 23,510 28 Bermuda 104 150 232 345 145 145 194 141 357 141 29 Brazil 3,385 4,901 4,629 4,443 4,659 4,599 4,858 5,252 5,591 6,141 30 British West Indies 1,464 5,082 6,481 6,272 7,412 6,872 6,885 8,397 7,171 6,421 31 Chile 494 597 675 717 745 745 809 742 832 862 3 3 2 3 C C o u l b o a m bia 75 1 1 4 67 1 5 3 67 1 1 0 578 I 615 648 690J 727J 793 935 34 Ecuador 252 375 517 529 562 546 560 646 623 681 35 Guatemala3 79 90 83 115 79 83 90 36 Jamaica3 42 53 49 44 46 66 49 37 Mexico 3,745 4,822 4,909 4,505 4,865 5,068 5,004 5,007 4,852 5,255 38 Netherlands Antilles4 72 140 224 206 212 206 198 230 213 241 39 Panama 1,138 1,372 1,410 2,147 1,901 2,278 1,625 2,280 2,482 2,526 40 Peru 805 933 962 920 930 918 928 966 945 931 41 Uruguay 57 42 80 58 53 52 56 51 63 58 42 Venezuela 1,319 1,828 2,318 2,233 2,240 2,337 2,515 2,745 3,105 3,367 43 Other Latin America and Caribbean., 1,302 1,293 1,394 1,233 1,227 1,212 1,250 1,367 1,387 1,389 44 Asia 17,706 19,204 19,236 19,448 19,317 18,326 18,918 18,994 21,249 22,436 45 China, People's Republic of (Mainland). 22 3 10 22 13 5 31 8 10 6 China, Republic of (Taiwan) 1,053 1,344 1,719 1,456 1,343 1,193 1,177 1,241 1,289 1,338 Hong Kong 289 316 543 754 769 698 666 705 1,320 1,242 India 57 69 53 70 80 46 73 76 66 46 Indonesia 246 218 232 137 146 139 125 152 144 188 Israel 721 755 584 494 468 445 504 544 555 719 Japan 10,944 11,040 9,839 9,741 10,023 9,779 9,876 10,205 10,505 11,884 Korea 1,791 1,978 2,336 1,801 2,328 1,937 1,925 1,930 1,779 1,741 Philippines 534 719 594 751 680 641 743 730 732 717 T M O h t i h a d e i d l r a l e n A d E s i a a s t oil-exporting countries5.... 7 7 5 8 4 2 5 4 0 1,4 4 8 5 4 6 9 2 3 1,7 6 9 4 4 3 6 7 3 2,5 7 9 2 3 7 1 0 0 1 1, , 1 5 7 8 7 1 1 5 1 1 1 , , 5 1 7 5 6 2 1 7 5 1 1 , , 9 1 6 5 5 9 1 5 3 1 1 , , 6 1 6 1 5 3 3 6 3 2 2 , , 0 0 7 9 1 4 6 2 1 2 1 , , 1 6 7 8 1 5 1 7 8 57 Africa 1,933 2,311 2,518 2,218 2,136 2,133 2,267 2,158 2,218 2,163 58 Egypt 123 126 119 72 70 79 62 67 56 68 59 Morocco 8 27 43 37 38 36 42 38 40 36 60 South Africa 657 957 1,066 1,055 1,054 1,036 1,058 1,022 990 906 61 Zaire 181 112 98 80 79 79 79 82 161 162 62 Oil-exporting countries6. 382 524 510 441 383 340 459 406 438 439 63 Other 581 565 682 533 512 563 566 544 533 551 64 Other countries., 830 772 1,090 965 995 1,002 980 1,063 1,023 1,041 65 Australia 700 597 905 798 828 836 835 894 879 894 66 All other 130 175 186 166 167 167 145 168 145 147 67 Nonmonetary International and Regional Organizations7 33 40 43 34 31 36 38 39 41 42 1 Includes the Bank for International Settlements. Beginning April' 6 Comprises Algeria, Gabon, Libya, and Nigeria. 1978, also includes Eastern European countries not listed in line 23. 7 Excludes the Bank for International Settlements, which is included 2 Beginning April 1978 comprises Bulgaria, Czechoslovakia, German in "Other Western Europe." Democratic Republic, Hungary, Poland, and Romania. 3 Included in "Other Latin America and Caribbean" through March NOTE.—Data for period prior to April 1978 include claims of banks' 1978. domestic customers on foreigners. For a description of the changes in 4 Includes Surinam through December 1975. the International Statistics tables, see July 1978 BULLETIN, p. 612. 5 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial States). Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A62 International Statistics • January 1979 3.17 BANKS' OWN AND DOMESTIC CUSTOMERS' CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1978 Type of claim 1975 1976 1977 May June July Aug. Sept. Oct.? Nov.2 1 Total 58,308 79,301 90,206 96,184 103,495 2 Banks' own claims on foreigners. 87,832 87,212 87,349 91,844 94,399 96,527 104,975 3 Foreign public borrowers. 5,739 6,036 6,858 7,292 7,708 7,949 9,176 4 Own foreign offices1 35,882 31,590 33,813 37,325 34,828 36,402 40,330 5 Unaffiliated foreign banks. 27,772 30,166 27,499 27,400 31,467 31,031 33,582 6 Deposits 4,656 5,116 4,623 4.352 4,482 3,965 4,004 7 Other 23,115 25,050 22,876 23,049 26,985 27,066 29,578 8 All other foreigners 18.439 19.419 19,179 19,826 20,396 21,145 21,887 9 Claims of banks' domestic customers2. 8,973 9,095 10 Deposits 389 563 11 Negotiable and readily transferable instruments 3 3,694 3,717 12 Outstanding collections and other claims4.... 5,467 5,756 6,176 4,889 4,816 13 MEMO: Customer liability on acceptances... 11,995 13,091 1 U.S. banks: includes amounts due from own foreign branches and 3 Principally negotiable time certificates of deposit and bankers acforeign subsidiaries consolidated in "Consolidated Report of Condition" ceptances. filed with bank regulatory agencies. Agencies, branches, and majority- 4 Data for March 1978 and for period prior to that are outstanding owned subsidiaries of foreign banks: principally amounts due from head collections only. office or parent foreign bank, and foreign branches, agencies, or whollyowned subsidiaries of head office or parent foreign bank. NOTE.—Beginning April 1978, data for banks' own claims are given 2 Assets owned by customers of the reporting bank located in the on a monthly basis, but the data for claims of banks' domestic customers United States that represent claims on foreigners held by reporting banks are available on a quarterly basis only. for the account of their domestic customers. For a description of the changes in the International Statistics tables, see July 1978 BULLETIN, p. 612. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A63 3.18 BANKS' OWN CLAIMS ON UNAFFILIATED FOREIGNERS Reported by Banks in the United States Payable in U.S. Dollars Millions of dollars, end of period 1978 1979 MMaattuurriittyy;; bbyy bboorrrroowweerr aanndd aarreeaa 11997788 11997799 June*1 Sept.P Dec. Mar. June Sept. 1 Total. 5555555555555555555555555555555555555555,,,,,,,,,,,,,,,,,,,,111111111111111111112222222222222222222288888888888888888888 5555555555555555555599999999999999999999,,,,,,,,,,,,,,,,,,,,555555555555555555551111111111111111111166666666666666666666 By borrower: 4444444444444444444433333333333333333333,,,,,,,,,,,,,,,,,,,,666666666666666666668888888888888888888822222222222222222222 4444444444444444444466666666666666666666,,,,,,,,,,,,,,,,,,,,666666666666666666668888888888888888888844444444444444444444 3 Foreign public borrowers 22222222222222222222,,,,,,,,,,,,,,,,,,,,999999999999999999991111111111111111111199999999999999999999 33333333333333333333,,,,,,,,,,,,,,,,,,,,666666666666666666664444444444444444444400000000000000000000 4 All other foreigners 4444444444444444444400000000000000000000,,,,,,,,,,,,,,,,,,,,777777777777777777776666666666666666666633333333333333333333 4444444444444444444433333333333333333333,,,,,,,,,,,,,,,,,,,,000000000000000000004444444444444444444444444444444444444444 5 Maturity of over 1 year* 1111111111111111111111111111111111111111,,,,,,,,,,,,,,,,,,,,444444444444444444444444444444444444444455555555555555555555 1111111111111111111122222222222222222222,,,,,,,,,,,,,,,,,,,,888888888888888888883333333333333333333322222222222222222222 6 Foreign public borrowers.... .... 33333333333333333333,,,,,,,,,,,,,,,,,,,,111111111111111111116666666666666666666622222222222222222222 33333333333333333333,,,,,,,,,,,,,,,,,,,,999999999999999999992222222222222222222288888888888888888888 7 All other foreigners ... 88888888888888888888,,,,,,,,,,,,,,,,,,,,222222222222222222228888888888888888888833333333333333333333 88888888888888888888,,,,,,,,,,,,,,,,,,,,999999999999999999990000000000000000000044444444444444444444 By area: Maturity of 1 year or less1 8 Europe 99999999999999999999,,,,,,,,,,,,,,,,,,,,555555555555555555553333333333333333333322222222222222222222 1111111111111111111100000000000000000000,,,,,,,,,,,,,,,,,,,,333333333333333333338888888888888888888866666666666666666666 9 Canada. . 11111111111111111111,,,,,,,,,,,,,,,,,,,,666666666666666666661111111111111111111155555555555555555555 11111111111111111111,,,,,,,,,,,,,,,,,,,,999999999999999999994444444444444444444433333333333333333333 10 Latin America and Caribbean 1111111111111111111177777777777777777777,,,,,,,,,,,,,,,,,,,,000000000000000000003333333333333333333366666666666666666666 1111111111111111111188888888888888888888,,,,,,,,,,,,,,,,,,,,555555555555555555551111111111111111111188888888888888888888 11 Asia 1111111111111111111133333333333333333333,,,,,,,,,,,,,,,,,,,,555555555555555555551111111111111111111155555555555555555555 1111111111111111111133333333333333333333,,,,,,,,,,,,,,,,,,,,777777777777777777771111111111111111111122222222222222222222 12 Africa . 11111111111111111111,,,,,,,,,,,,,,,,,,,,444444444444444444446666666666666666666611111111111111111111 11111111111111111111,,,,,,,,,,,,,,,,,,,,555555555555555555553333333333333333333355555555555555555555 13 All other2 555555555555555555552222222222222222222233333333333333333333 555555555555555555559999999999999999999911111111111111111111 Maturity of over 1 year1 14 Europe 22222222222222222222,,,,,,,,,,,,,,,,,,,,999999999999999999997777777777777777777799999999999999999999 33333333333333333333,,,,,,,,,,,,,,,,,,,,111111111111111111110000000000000000000044444444444444444444 15 Canada 333333333333333333333333333333333333333300000000000000000000 777777777777777777779999999999999999999933333333333333333333 16 Latin America and Caribbean 55555555555555555555,,,,,,,,,,,,,,,,,,,,999999999999999999997777777777777777777799999999999999999999 66666666666666666666,,,,,,,,,,,,,,,,,,,,888888888888888888884444444444444444444433333333333333333333 17 Asia 11111111111111111111,,,,,,,,,,,,,,,,,,,,222222222222222222228888888888888888888822222222222222222222 11111111111111111111,,,,,,,,,,,,,,,,,,,,333333333333333333330000000000000000000055555555555555555555 18 Africa 666666666666666666662222222222222222222299999999999999999999 555555555555555555557777777777777777777777777777777777777777 19 All other2 222222222222222222224444444444444444444477777777777777777777 222222222222222222221111111111111111111111111111111111111111 1 Remaining time to maturity. NOTE.—The first available data are for June 1978. For a description of 2 Includes nonmonetary international and regional organizations. the changes in the International Statistics tables, see July 1978 BULLETIN, p. 612. 3.19 LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Banks in the United States Payable in Foreign Currencies Millions of dollars, end of period 1978 Item 1974 1975 1976 1977 Mar. Junef Sept.? 1 Banks' own liabilities 766 560 781 925 986 1,704 1,980 2 Banks' own claims1 1,276 1,459 1,834 2,356 2,383 3,153 3,530 3 Deposits 669 656 1,103 941 948 1,290 1,386 4 Other claims 607 802 731 1,415 1,435 1,863 2,144 5 Claims of banks' domestic customers2 880099 444466 1 Includes claims of banks' domestic customers through March 1978. NOTE.—Data on claims exclude foreign currencies held by U.S. mone- 2 Assets owned by customers of the reporting bank located in the tary authorities. United States that represent claims on foreigners held by reporting banks For a description of the changes in the International Statistics Tables, for the accounts of their domestic customers. see July 1978 BULLETIN, p. 612. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A64 International Statistics • January 1979 3.20 MARKETABLE U.S. TREASURY BONDS AND NOTES Foreign Holdings and Transactions Millions of dollars 1978 1978 Country or area 1976 1977 * Jan.- May June July Aug. Sept. Oct.f Nov.f NOV.p Holdings (end of period) • 1 Estimated total... 15,799 38,640 39,387 40,658 41,148 41,573 42,212 43,622 43,847 2 Foreign countries. 12,765 33,894 34,366 34,964 36,306 37,119 37,826 38,472 38,469 3 Europe 2,330 13,936 12,966 13,106 14,226 14,154 14,689 15,260 15,654 4 Belgium-Luxembourg.. 14 19 19 19 19 19 19 19 19 5 Germany 764 3,168 4,031 4,361 5,531 5,761 6,157 6,645 7,102 6 Netherlands 288 911 1,070 1,113 1,113 1,278 1,306 1,356 1,351 7 Sweden 191 100 175 185 200 210 211 231 266 8 Switzerland 261 497 468 529 590 636 694 731 915 9 United Kingdom 485 8,888 6,856 6,527 6,403 5,862 5,909 5,915 5,674 10 Other Western Europe. 323 349 348 371 370 387 393 365 327 11 Eastern Europe....... 4 4 12 Canada. 256 288 261 264 275 276 276 151 151 13 Latin America and Caribbean 313 551 503 494 485 545 445 426 416 14 Venezuela 149 199 174 174 174 244 144 144 144 15 Other Latin American and Caribbean. 47 183 167 158 149 139 139 119 109 16 Netherlands Antilles 118 170 162 162 162 162 162 162 162 17 Asia 9,323 18,745 20,137 20,605 20,831 21,647 21,919 21,938 21,560 18 Japan. 2,687 6,860 8,964 9,616 9,927 10,791 11,096 11,560 11,483 19 Africa 543 362 491 491 491 491 491 691 691 20 All other. 11 4 -3 7 5 6 -3 21 Nonmonetary international and regional organizations. 3,034 4,746 5,021 5,694 4,842 4,454 4,386 5,150 5,378 22 International 2,906 4,646 4,931 5,633 4,809 4,421 4,354 5,118 5,345 23 Latin American regional. 128 100 90 61 33 33 33 33 33 Transactions (net purchases, or sales (—), during period) 24 Total 8,096 22,843 5,206 -295 1,271 490 425 639 1,410 225 25 Foreign countries 5,393 21,130 4,574 -467 599 1,342 813 706 646 -3 5,119 20,369 4,052 -566 522 1,313 710 704 577 69 27 Other foreign 274 762 521 99 77 29 103 3 69 -72 28 Nonmonetary international and regional organizations 2,704 1,713 632 171 671 -852 -387 -67 764 227 MEMO: Oil-exporting countries 29 Middle East i 3,887 4,451 -1,663 -563 -185 -85 -31 -31 -401 -241 30 Africa 2 222211 --118811 332299 115500 220000 -1 1 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia, 3 Estimated official and private holdings of marketable U.S. Treasury and United Arab Emirates (Trucial States). securities with an original maturity of more than 1 year. Data are based 2 Comprises Algeria, Gabon, Libya, and Nigeria. on a benchmark survey of holdings as of Jan. 31, 1971, and monthly transactions reports. Excludes nonmarketable U.S. Treasury bonds and notes held by official institutions of foreign countries. 3.21 FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS Millions of dollars, end of period 1978 AAsssseettss 11997755 11997766 11997777 June July Aug. Sept. Oct. Nov. Dec.? 353 352 424 288 347 309 325 305 379 367 Assets held in custody: 2 U.S. Treasury securities1 60,019 66,532 91,962 99,465 101,696 102,902 102,699 107,934 112,434 117,126 16,745 16,414 15,988 15,620 15,594 15,572 15,553 15,548 15,525 15,463 1 Marketable U.S. Treasury bills, certificates of indebtedness, notes, NOTE.—Excludes deposits and U.S. Treasury securities held for interand bonds; and nonmarketable U.S. Treasury securities payable in dollars national and regional organizations. Earmarked gold is gold held for and in foreign currencies. foreign and international accounts and is not included in the gold stock 2 The value of earmarked gold increased because of the changes in of the United States. par value of the U.S. dollar in May 1972 and in October 1973. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Investment transactions A65 3.22 FOREIGN TRANSACTIONS IN SECURITIES Millions of dollars 1978 1978 TTrraannssaaccttiioonnss,, aanndd aarreeaa oorr ccoouunnttrryy 1976 1977 N Ja o n v . . - f May June July Aug. Sept. Oct.f Nov.f U.S. corporate securities Stocks 1 Foreign purchases 18.227 14,155 18,648 2,391 2,055 1,305 2,444 2,357 1,510 1,461 2 Foreign sales 15,475 11,479 16,614 1,963 1,936 1,296 2,678 2,115 1,523 1,359 3 Net purchases, or sales (—) 2,753 2,676 2,034 427 119 9 -235 241 -14 102 4 Foreign countries 2,740 2,661 2,080 427 139 9 -235 244 -15 102 5 Europe 336 1,006 970 323 39 -6 -152 -33 -91 -10 6 France 256 40 85 -2 -39 -15 9 2 -4 1 7 Germany 68 291 356 52 83 17 -54 24 -30 8 8 Netherlands -199 22 -13 9 -18 9 -22 7 7 6 9 Switzerland -100 152 -562 31 -76 -52 -184 -115 -118 -88 10 United Kingdom 340 613 1,144 229 101 50 110 54 58 67 11 Canada 324 65 37 -58 -12 -16 -18 117 22 6 12 Latin America and Caribbean 155 127 135 36 33 -35 48 1 13 -2 13 Middle East1 1,803 1,390 777 90 59 69 -134 120 42 109 14 Other Asia 119 59 171 39 23 -5 35 35 -4 1 15 Africa 7 5 -12 -4 -3 1 -12 5 2 -2 16 Other countries -4 8 2 • * * 2 1 17 Nonmonetary international and regional organizations 13 15 -47 1 -21 * * -3 1 * Bonds2 18 Foreign purchases 5,529 7,739 7,070 779 669 1,029 872 611 727 437 19 Foreign sales 4,327 3,546 4,891 333 302 596 490 550 530 388 20 Net purchases, or sales (—) 1,202 4,192 2,179 446 367 433 383 61 197 49 21 Foreign countries 1,243 4,096 1,962 448 295 411 330 64 137 39 22 Europe 86 1,863 814 41 157 387 137 80 89 25 23 France 39 -34 12 8 -3 13 6 -2 -10 3 24 Germany -49 -20 109 21 14 18 38 -5 -12 6 25 Netherlands -29 72 25 -3 -7 11 18 19 -4 -1 26 Switzerland 155 94 -139 -36 5 -74 -20 43 9 9 27 United Kingdom 23 1,703 821 75 154 416 89 * 110 9 28 Canada 96 141 96 9 6 14 24 16 -5 * 29 Latin America and Caribbean 94 64 73 12 2 -8 17 11 13 -1 30 Middle East1 1,179 1,695 831 370 91 135 99 -73 -19 -8 31 Other Asia -165 338 145 14 39 -116 52 29 60 23 32 Africa -25 -6 — 1 * * * * * * * 33 Other countries -21 * 4 1 * * 1 * * * 34 Nonmonetary international and regional organizations -41 96 217 -1 72 22 53 -3 60 10 Foreign securities 35 Stocks, net purchases, or sales (—) -323 -410 536 -13 -61 10 51 -69 -19 163 36 Foreign purchases 1,937 2,255 3,429 271 247 333 382 261 299 360 37 Foreign sales 2,259 2,665 2,893 284 308 323 331 330 318 197 38 Bonds, net purchases, or sales (—) -8,774 -5,095 -4,045 -39 -636 -291 -196 33 -677 -431 39 Foreign purchases 4,932 8,040 9,992 1,017 1,095 921 982 759 941 871 40 Foreign sales 13,706 13,134 14,037 1,056 1,730 1,212 1,178 726 1,618 1,302 41 Net purchases, or sales (—) of stocks and bonds.. -9,097 -5,504 -3,510 -51 -697 -281 -145 -36 -696 -268 42 Foreign countries -7,199 -3,947 -3,291 -67 -742 -283 -150 -70 -507 -288 43 Europe -850 -1,100 -86 -194 -220 -171 94 -86 13 -102 44 Canada -5,245 -2,404 -3,213 -80 -420 -146 -161 -41 -747 -246 45 Latin America and Caribbean -3 -80 220 72 -68 8 -17 -12 -17 33 46 Asia -733 -97 380 131 192 44 54 69 236 21 47 Africa 48 2 -441 * -44 -25 -123 _ i 1 48 Other countries -416 -267 -151 4 -182 7 3 1 6 4 49 Nonmonetary international and regional organizations -1,898 -1,557 -219 16 45 2 5 34 -189 20 Comprises oil-exporting countries as follows: Bahrain, Iran, Iraq, 2 Includes State and local government securities, and securities of U.S. Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial Govt, agencies and corporations. Also includes issues of new debt securities States). sold abroad by U.S. corporations organized to finance direct investments abroad. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A66 International Statistics • January 1979 3.23 SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars, end of period 1977 1978 1977 1978 Type, and area or country June Sept. Dec. Mar. June? June Sept. Dec. Mar. June^ Liabilities to foreigners Claims on foreigners 1 Total 6,624 7,315 7,971 8,448 8,817 16,352 15,249 16,293 18,481 18,293 By type: 2 Payable in dollars 5,909 6,459 7,171 7,564 7,992 15,192 14,132 14,863 16,762 16,711 3 Payable in foreign currencies 715 857 801 884 825 1,160 1,117 11,,443300 11,,771188 1,582 4 Deposits with banks abroad in reporter's name 448 414 620 724 676 5 Other 771133 770033 880099 999955 990077 By area or country: 6 Foreign countries 6,454 7,161 7,756 8,301 8,685 16,351 15,248 16,291 18,479 18,291 7 Europe 2,253 2,335 2,512 2,854 3,028 5,799 5,077 5,797 5,626 5,326 8 Austria 23 19 21 26 26 26 24 24 21 28 9 Belgium-Luxembourg 151 126 116 171 167 212 226 211 187 155 10 Denmark 14 16 14 23 22 40 44 56 47 40 11 Finland 10 11 9 12 9 90 59 13 13 53 12 France 156 170 238 273 323 413 430 513 545 543 13 Germany 163 226 284 335 355 377 393 453 411 419 14 Greece 73 78 85 108 82 86 52 41 42 40 15 Italy 138 107 128 104 156 440 352 387 382 459 16 Netherlands 212 180 232 253 221 182 161 166 184 187 17 Norway 12 12 7 9 13 42 38 42 42 47 18 Portugal 20 12 11 7 25 30 34 69 27 54 19 Spain 68 74 77 94 105 322 307 387 408 376 20 Sweden 36 41 28 37 38 92 91 117 117 78 21 Switzerland 236 257 263 229 282 179 146 220 238 296 22 Turkey 21 97 108 93 92 37 32 39 35 29 23 United Kingdom 780 784 756 954 976 3,012 2,495 2,825 2,706 2,374 24 Yugoslavia 110 92 90 82 84 28 20 20 24 27 25 Other Western Europe 6 9 10 8 18 15 15 25 33 29 26 U.S.S.R 16 11 24 15 19 76 62 55 44 37 27 Other Eastern Europe 10 14 12 23 18 102 96 135 121 56 28 Canada 448 451 504 530 524 2,709 2,649 2,682 3,429 3,486 29 Latin America 1,028 1,035 1,186 1,352 1,419 5,000 4,619 4,491 5,895 6,067 30 Argentina 50 50 40 53 74 51 53 53 53 61 31 Bahamas 223 229 308 310 307 2,309 1,963 2,028 3,108 3,108 32 Brazil 37 76 49 62 78 457 414 517 499 494 33 Chile 24 13 17 14 23 28 40 45 40 37 34 Colombia 22 24 42 26 27 72 85 84 80 79 35 Cuba * * * * * * * * * * 36 Mexico 120 103 114 169 185 301 302 314 312 331 37 Panama 11 12 22 12 71 121 222 91 175 97 38 Peru 21 13 15 22 17 28 30 32 30 30 39 Uruguay 3 4 3 5 9 5 5 5 6 4 40 Venezuela 208 225 222 280 197 237 251 269 306 311 41 Other Latin American republics 141 122 118 107 101 237 257 281 268 235 42 Netherlands Antilles 17 9 25 41 30 8 8 12 24 19 43 Other Latin America 151 154 209 250 299 1,146 989 759 994 1,261 44 2,017 22,,664400 2,871 2,850 33,,000000 2,323 2,403 2,782 2,976 2,836 45 China, People's Republic of (Mainland).... 2 11 8 1 11 1 12 9 22 21 46 China, Republic of (Taiwan) 138 152 156 167 170 131 139 157 144 173 47 Hong Kong 27 25 40 32 29 93 73 98 85 93 48 India 41 44 37 26 11 51 42 38 85 93 49 Indonesia 80 60 56 57 59 184 185 375 185 153 50 Israel 45 58 63 68 59 70 46 38 47 43 51 Japan 183 604 695 761 799 927 1,026 1,068 1,379 1,157 52 Korea 88 75 103 99 107 158 153 171 133 170 53 73 78 74 95 107 90 111 99 94 94 54 Thailand 11 17 17 11 27 22 24 23 32 30 55 Other Asia 1,329 1,526 1,623 1,535 1,631 591 590 708 770 808 56 Africa 609 588 591 612 603 370 346 393 408 433 57 Egypt 33 45 13 19 25 24 22 38 33 38 58 Morocco 72 105 112 130 148 11 10 21 22 16 59 South Africa 27 29 20 30 39 69 75 75 71 85 60 Zaire 39 48 46 55 57 17 19 15 11 16 61 Other Africa 438 361 400 378 335 248 221 245 271 279 62 Other countries 98 111 93 104 111 149 153 146 145 144 63 Australia 78 93 75 89 97 110 113 111 111 109 64 All other 20 18 18 14 14 40 41 35 34 34 65 Nonmonetary international and regional organizations 117700 115544 221155 114477 113322 1 11 11 11 2 NOTE.—Reported by exporters, importers, and industrial and com- Data exclude claims held through U.S. banks and intercompany accounts mercial concerns and other nonbanking institutions in the United States. between U.S. companies and their affiliates. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Nonbank-reported Data A67 3.24 SHORT-TERM CLAIMS ON FOREIGNERS Reported by Large Nonbanking Concerns in the United States Millions of dollars, end of period 1978 Type and country 1974 1975 1976 1977 May June July Aug. Sept. Oct.f 1 Total 3,357 3,799 5,720 7,179 9,679 8,912 8,924 10,092 8,550 10,499 By type: 2 Payable in dollars 2,660 3,042 4,984 6,158 8,534 7,771 7,639 8,804 7,331 9,237 3 Deposits 2,591 2,710 4,505 5,740 7,897 7,218 7,156 8,243 6,894 8,686 4 Short-term investments 69 332 479 418 637 553 483 561 437 551 5 Payable in foreign currencies 697 757 735 1,021 1,145 1,142 1,285 1,289 1,220 1,261 6 Deposits 429 511 404 553 544 599 669 669 725 787 7 Short-term investments 1. 268 246 331 468 601 543 616 620 495 474 By country: 8 United Kingdom 1,350 1,306 1,838 2,144 1,660 1,683 1,861 1,839 2,171 2,947 9 Canada 967 1,156 1,698 1,777 2,866 2,547 2,513 3,008 2,440 2,857 10 Bahamas 391 546 1,355 1,904 3,612 2,975 3,222 3,541 2,235 2,819 11 Japan 398 343 133 153 266 273 286 292 267 234 12 All other 252 446 716 1,201 1,275 1,435 1,042 1,412 1.437 1,642 i Negotiable and other readily transferable foreign obligations payable NOTE.—Data represent the assets abroad of large nonbanking conon demand or having a contractural maturity of not more than 1 year cerns in the United States. They are a portion of the total claims on from the date on which the obligation was incurred by the foreigner. foreigners reported by nonbanking concerns in the United States and are included in the figures shown in Table 3.26. 3.25 LONG-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS Reported by Nonbanking Concerns in the United States Millions of dollars, end of period 1977 1978 1977 1978 AArreeaa aanndd ccoouunnttrryy June Sept. Dec. Mar. June2' June Sept. Dec. Mar. June? Liabilities to foreigners Claims on foreigners 1 Total 3,358 3,388 3,259 3,234 3,158 4,914 4,715 5,073 5,140 5,060 2 Europe... 2,504 2,602 2,499 2,571 2,494 901 829 860 935 936 3 Germany 370 407 255 295 282 76 76 70 73 65 4 Netherlands 262 272 287 292 266 147 81 82 81 76 5 Switzerland 177 224 241 241 236 43 42 49 48 55 6 United Kingdom 1,277 1,295 1,276 1.284 1,270 283 282 310 332 363 7 Canada 79 76 71 67 66 1,486 1,462 1,776 1,792 1,811 8 Latin America 297 289 284 250 250 1,452 1,367 1,402 1,387 1,298 9 Bahamas 160 151 148 142 141 34 36 40 42 2 10 Brazil 7 7 7 6 7 125 134 144 154 143 11 Chile 1 1 1 1 1 208 201 203 194 190 12 Mexico 26 30 30 30 28 178 187 177 183 188 13 Asia 408 358 342 284 286 851 829 817 810 803 386 319 305 250 251 111 94 66 83 78 15 Africa 3 3 2 2 2 158 165 161 156 154 16 All other i 67 59 60 60 60 67 63 59 60 59 1 Includes nonmonetary international and regional organizations. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A68 International Statistics • January 1979 3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS Per cent per annum Rate on Dec. 31, 1978 Rate on Dec. 31, 1978 Rate on Dec. 31, 1978 Country Country CCoouunnttrryy Per Month Per Month Per Month cent effective cent effective cent effective Argentina 18.0 Feb. 1972 France 9.5 Aug. 1977 7.0 Feb. 1978 Austria... 4.5 June 1978 Germany, Fed. Rep. of. 3.0 Dec. 1977 6.5 July 1978 Belgium. . 6.0 July 1978 Italy 10.5 Sept. 1978 1.0 Feb. 1978 Brazil 33.6 July 1978 Japan 3.5 Mar. 1978 United Kingdom 12.5 Nov. 1978 Canada.. 10.75 Nov. 1978 Mexico 4.5 June 1942 5.0 Oct. 1970 Denmark. 8.0 July 1977 Netherlands 6.5 Oct. 1978 NOTE.—Rates shown are mainly those at which the central bank either more than one rate applicable to such discounts or advances, the rate discounts or makes advances against eligible commercial paper and/or shown is the one at which it is understood the central bank transacts the government securities for commercial banks or brokers. For countries with largest proportion of its credit operations. 3.27 FOREIGN SHORT-TERM INTEREST RATES Per cent per annum, averages of daily figures 1978 Country, or type 1976 1977 1978 July Aug. Sept. Oct. Nov. Dec. 1 Euro-dollars 5.58 6.03 8.74 8.52 8.48 9.12 10.12 11.51 11.62 2 United Kingdom 11.35 8.07 9.18 10.13 9.42 9.29 10.44 12.00 12.28 3 Canada 9.39 7.47 8.52 8.23 8.77 9.08 9.68 10.37 10.44 4 Germany 4.19 4.30 3.67 3.71 3.64 3.67 3.90 3.81 4.09 5 Switzerland 1.45 2.56 0.74 1.74 0.67 0.58 0.24 0.20 0.22 6 Netherlands 7.02 4.73 6.53 5.61 6.27 6.91 11.23 8.86 10.25 7 France 8.65 9.20 8.10 7.61 7.39 7.40 7.37 7.06 6.59 8 Italy 16.32 14.26 11.40 11.75 11.75 10.94 10.99 11.17 11.24 9 Belgium 10.25 6.95 7.14 5.84 7.09 7.24 8.55 9.19 9.28 10 Japan 7.70 6.22 4.75 4.75 4.64 4.51 4.44 4.78 4.76 NOTE.—Rates are for 3-month interbank loans except for—Canada, over; and Japan, loans and discounts that can be called after being held finance company paper; Belgium, time deposits of 20 million francs and over a minimum of two month-ends. 3.28 FOREIGN EXCHANGE RATES Cents per unit of foreign currency 1978 CCoouunnttrryy//ccuurrrreennccyy 1976 1977 1978 July Aug. Sept. Oct. Nov. Dec. 1 Australia/dollar 122.15 110.82 114.41 114.94 115.41 115.29 116.87 114.53 114.15 2 Austria/schilling 5.5744 6.0494 6.8958 6.7547 6.9490 7.0102 7.4526 7.1808 7.2621 3 Belgium/franc 2.5921 2.7911 3.1809 3.0864 3.1834 3.2207 3.4503 3.3389 3.3637 4 Canada/dollar 101.41 94.112 87.729 88.921 87.690 85.739 84.546 85.244 84.763 5 Denmark/krone 16.546 16.658 18.156 17.846 18.171 18.411 19.584 19.025 19.063 6 Finland/markka 25.938 24.913 24.337 23.809 24.381 24.586 25.454 24.932 24.957 7 France/franc 20.942 20.344 22.218 22.531 22.998 22.909 23.767 22.958 23.178 8 Germany/deutsche mark... 39.737 43.079 49.867 48.647 50.084 50.778 54.430 52.508 53.217 9 India/rupee 11.148 11.406 12.207 12.245 12.483 12.445 12.643 12.458 12.174 10 Ireland/pound 180.48 174.49 191.84 189.49 194.06 195.95 200.75 196.08 198.61 11 Italy/lira .12044 .11328 .11782 .11804 .11952 .12050 .12317 .11857 .11863 12 Japan/yen .33741 .37342 .47981 .50101 .53002 .52656 .54478 .52066 .51038 13 Malaysia/ringgit 39.340 40.620 43.210 42.447 43.433 43.603 45.627 45.415 45.524 14 Mexico/peso 6.9161 4.4239 4.3896 4.3756 4.3758 4.3907 4.3904 4.3881 4.3950 15 Netherlands/guilder 37.846 40.752 46.284 45.076 46.203 46.733 50.017 48.512 49.120 16 New Zealand/dollar 99.115 96.893 103.64 103.85 105.42 105.58 107.37 105.41 105.45 17 Norway/krone 18.327 18.789 19.079 18.524 19.018 19.189 20.325 19.736 19.574 18 Portugal/escudo 3.3159 2.6234 2.2782 2.1939 2.2042 2.1948 2.2342 2.1510 2.1472 19 South Africa/rand 114.85 114.99 115.01 115.00 115.00 115.00 115.00 115.04 115.01 20 Spain/peseta 1.4958 1.3287 1.3073 1.2885 1.3344 1.3605 1.4317 1.4051 1.4085 21 Sri Lanka/rupee 11.908 11.964 6.3834 6.3245 6.3926 6.3855 6.3757 6.4695 6.4700 22 Sweden/krona 22.957 22.383 22.139 22.012 22.523 22.592 23.349 22.856 22.808 23 Switzerland/franc 40.013 41.714 56.283 55.443 60.013 63.765 65.117 59.766 59.703 24 United Kingdom/pound... 180.48 174.49 191.84 189.49 194.06 195.95 200.75 196.08 198.61 MEMO: 25 United States/dollar1 110055..5577 110033..3311 9922..4444 8899..9999 8899..5511 8866..0044 8888..8866 8888..5522 I Index of weighted average exchange value of U.S. dollar against cur- NOTE.—Averages of certified noon buying rates in New York for cable rencies of other G-10 countries plus Switzerland. March 1973 = 100. transfers. Weights are 1972-76 global trade of each of the 10 countries. Series revised as of August 1978. For description and back data, see "Index of the Weighted-Average Exchange Value of the U.S. Dollar: Revision" on page 700 of the August 1978 BULLETIN. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A69 Guide to Tabular Presentation and Statistical Releases GUIDE TO TABULAR PRESENTATION Symbols and Abbreviations p Preliminary SMSAs Standard metropolitan statistical areas r Revised (Notation appears on column head- REITs Real estate investment trusts ing when more than half of figures in that * Amounts insignificant in terms of the particcolumn are changed.) ular unit (e.g., less than 500,000 when e Estimated the unit is millions) c Corrected (1) Zero, (2) no figure to be expected, or n.e.c. Not elsewhere classified (3) figure delayed or, (4) no change (when RPs Repurchase agreements figures are expressed in percentages). IPCs Individuals, partnerships, and corporations General Information Minus signs are used to indicate (1) a decrease, (2) as well as direct obligations of the Treasury. "State a negative figure, or (3) an outflow. and local government" also includes municipalities, "U.S. government securities" may include guaran- special districts, and other political subdivisions. teed issues of U.S. government agencies (the flow of In some of the tables details do not add to totals funds figures also include not fully guaranteed issues) because of rounding. STATISTICAL RELEASES List Published Semiannually, with Latest Bulletin Reference Issue Page Anticipated schedule of release dates for individual releases December 1978 A-76 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 70 Federal Reserve Board of Governors G. WILLIAM MILLER, Chairman PHILIP E. COLDWELL HENRY C. WALLICH J. CHARLES PARTEE OFFICE OF BOARD MEMBERS OFFICE OF STAFF DIRECTOR FOR MONETARY AND FINANCIAL POLICY THOMAS J. O'CONNELL, Counsel to the Chairman JOSEPH R. COYNE, Assistant to the Board STEPHEN H. AXILROD, Staff Director KENNETH A. GUENTHER, Assistant to the Board EDWARD C. ETTIN, Deputy Staff Director JAY PAUL BRENNEMAN, Special Assistant to the MURRAY ALTMANN, Assistant to the Board Board PETER M. KEIR, Assistant to the Board FRANK O'BRIEN, JR., Special Assistant to the STANLEY J. SIGEL, Assistant to the Board Board NORMAND R. V. BERNARD, Special Assistant to JOSEPH S. SIMS, Special Assistant to the Board the Board DONALD J. WINN, Special Assistant to the Board DIVISION OF RESEARCH AND STATISTICS LEGAL DIVISION JAMES L. KICHLINE, Director JOSEPH S. ZEISEL, Deputy Director NEAL L. PETERSEN, General Counsel JOHN H. KALCHBRENNER, Associate Director ROBERT E. MANNION, Associate General JOHN J. MINGO, Senior Research Division Counsel Officer ALLEN L. RAIKEN, Associate General Counsel ELEANOR J. STOCKWELL, Senior Research Division Officer CHARLES R. MCNEILL, Assistant to the General Counsel JAMES M. BRUNDY, Associate Research Division Officer ROBERT A. EISENBEIS, Associate Research OFFICE OF THE SECRETARY Division Officer JARED J. ENZLER, Associate Research Division THEODORE E. ALLISON, Secretary Officer GRIFFITH L. GARWOOD, Deputy Secretary J. CORTLAND G. PERET, Associate Research "JOHN M. WALLACE, Assistant Secretary Division Officer RICHARD H. PUCKETT, Manager, Regulatory MICHAEL J. PRELL, Associate Research Division Improvement Project Officer HELMUT F. WENDEL, Associate Research Division Officer DIVISION OF CONSUMER AFFAIRS ROBERT M. FISHER, Assistant Research Division Officer JANET O. HART, Director FREDERICK M. STRUBLE, Assistant Research NATHANIEL E. BUTLER, Associate Director Division Officer JERAULD C. KLUCKMAN, Associate Director STEPHEN P. TAYLOR, Assistant Research ANNE GEARY, Assistant Director Division Officer LEVON H. GARABEDIAN, Assistant Director DIVISION OF BANKING DIVISION OF INTERNATIONAL FINANCE SUPERVISION AND REGULATION EDWIN M. TRUMAN, Director JOHN E. RYAN, Director ROBERT F. GEMMILL, Associate Director -{•FREDERICK C. SCHADRACK, Deputy Director GEORGE B. HENRY, Associate Director FREDERICK R. DAHL, Associate Director CHARLES J. SIEGMAN, Associate Director WILLIAM W. WILES, Associate Director SAMUEL PIZER, Senior International Division JACK M. EGERTSON, Assistant Director Officer DON E. KLINE, Assistant Director JEFFREY R. SHAFER, Associate International ROBERT S. PLOTKIN, Assistant Director Division Officer THOMAS A. SIDMAN, Assistant Director DALE W. HENDERSON, Assistant International SAMUEL H. TALLEY, Assistant Director Division Officer WILLIAM TAYLOR, Assistant Director LARRY J. PROMISEL, Assistant International Division Officer *On loan from the Federal Reserve Bank of Atlanta. RALPH W. SMITH, JR., Assistant International |On loan from the Federal Reserve Bank of New York. Division Officer Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 71 and Official Staff NANCY H. TEETERS OFFICE OF OFFICE OF STAFF DIRECTOR FOR STAFF DIRECTOR FOR MANAGEMENT FEDERAL RESERVE BANK ACTIVITIES JOHN M. DENKLER, Staff Director WILLIAM H. WALLACE, Staff Director ROBERT J. LAWRENCE, Deputy Staff Director JOSEPH W. DANIELS, SR., Director of Equal Employment Opportunity DIVISION OF FEDERAL RESERVE HARRY A. GUINTER, Program Director for BANK EXAMINATIONS AND BUDGETS Contingency Planning ALBERT R. HAMILTON, Director CLYDE H. FARNSWORTH, JR., Associate DIVISION OF DATA PROCESSING Director CHARLES W. BENNETT, Assistant Director CHARLES L. HAMPTON, Director JOHN F. HOOVER, Assistant Director BRUCE M. BEARDSLEY, Associate Director P. D. RING, Assistant Director UYLESS D. BLACK, Assistant Director RAYMOND L. TEED, Assistant Director GLENN L. CUMMINS, Assistant Director ROBERT J. ZEMEL, Assistant Director DIVISION OF FEDERAL RESERVE BANK OPERATIONS DIVISION OF PERSONNEL JAMES R. KUDLINSKI, Director DAVID L. SHANNON, Director WALTER ALTHAUSEN, Assistant Director JOHN R. WEIS, Assistant Director BRIAN M. CAREY, Assistant Director CHARLES W. WOOD, Assistant Director HARRY A. GUINTER, Assistant Director LORIN S. MEEDER, Assistant Director OFFICE OF THE CONTROLLER JOHN KAKALEC, Controller EDWARD T. MULRENIN, Assistant Controller DIVISION OF SUPPORT SERVICES DONALD E. ANDERSON,Director JOHN L. GRIZZARD, Associate Director WALTER W. KREIMANN, Associate Director JOHN D. SMITH, Assistant Director Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 72 Federal Reserve Bulletin • January 1979 FOMC and Advisory Councils FEDERAL OPEN MARKET COMMITTEE G. WILLIAM MILLER, Chairman PAUL A. VOLCKER, Vice Chairman ERNEST T. BAUGHMAN J. CHARLES PARTEE HENRY C. WALLICH PHILIP E. COLDWELL NANCY H. TEETERS MARK H. WILLES DAVID P. EASTBURN WILLIS J. WINN MURRAY ALTMANN, Secretary RICHARD G. DAVIS, Associate Economist NORM AND R. V. BERNARD, Assistant Secretary EDWARD C. ETTIN, Associate Economist THOMAS J. O'CONNELL, General Counsel IRA KAMINOW, Associate Economist EDWARD G. GUY, Deputy General Counsel PETER M. KEIR, Associate Economist ROBERT E. MANNION, Assistant General Counsel JAMES L. KICHLINE, Associate Economist STEPHEN H. AXILROD, Economist JOHN PAULUS, Associate Economist JOSEPH BURNS, Associate Economist EDWIN M. TRUMAN, Associate Economist JOHN M. DAVIS, Associate Economist JOSEPH S. ZEISEL, Associate Economist ALAN R. HOLMES, Manager, System Open Market Account PETER D. STERN LIGHT, Deputy Manager for Domestic Operations SCOTT E. PARDEE, Deputy Manager for Foreign Operations FEDERAL ADVISORY COUNCIL HENRY S. WOODBRIDGE, FIRST DISTRICT ROGER E. ANDERSON, SEVENTH DISTRICT WALTER B. WRISTON, SECOND DISTRICT CLARENCE C. BARKSDALE, EIGHTH DISTRICT WILLIAM B. EAGLESON, JR., THIRD DISTRICT RICHARD H. VAUGHAN, NINTH DISTRICT MERLE E. GILLIAND, FOURTH DISTRICT J. W. MCLEAN, TENTH DISTRICT J. OWEN COLE, FIFTH DISTRICT JAMES D. BERRY, ELEVENTH DISTRICT FRANK A. PLUMMER, SIXTH DISTRICT CHAUNCEY E. SCHMIDT, TWELFTH DISTRICT HERBERT V. PROCHNOW, Secretary WILLIAM J. KORSVIK, Associate Secretary CONSUMER ADVISORY COUNCIL WILLIAM D. WARREN, LOS At igeles, California, Chairman MARCIA A. HAKALA, Omaha Nebraska, Vice Chairman ROLAND E. BRANDEL, San Francisco, California PERCY W. LOY, Portland, Oregon JAMES L. BROWN, Milwaukee, Wisconsin R. C. MORGAN, El Paso, Texas MARK E. BUDNITZ, Boston, Massachusetts FLORENCE M. RICE, New York, New York JOHN G. BULL, Fort Lauderdale, Florida RALPH J. ROHNER, Washington, D. C. ROBERT V. BULLOCK, Frankfort, Kentucky RAYMOND J. SAULNIER, New York, New York CARL FELSENFELD, New York, New York HENRY S. SCHECHTER, Washington, D. C. JEAN A. Fox, Pittsburgh, Pennsylvania E. G. SCHUHART, Amarillo, Texas RICHARD H. HOLTON, Berkeley, California BLAIR C. SHICK, Cambridge, Massachusetts EDNA DECOURSEY JOHNSON, Baltimore, Mary- THOMAS R. SWAN, Portland, Maine land ANNE GARY TAYLOR, Alexandria, Virginia RICHARD F. KERR, Cincinnati, Ohio RICHARD A. VAN WINKLE, Salt Lake City, Utah ROBERT J. KLEIN, New York, New York RICHARD D. WAGNER, Simsbury, Connecticut HARVEY M. KUHNLEY, Minneapolis, Minnesota MARY W. WALKER, Monroe, Georgia Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 73 Federal Reserve Banks, Branches, and Offices FEDERAL RESERVE BANK, Chairman President Vice President branch, or facility Zip Deputy Chairman First Vice President in charge of branch BOSTON* 02106 Robert M. Solow Frank E. Morris Robert P. Henderson James A. Mcintosh NEW YORK* 10045 Robert H. Knight Paul A. Volcker Boris Yavitz Thomas M. Timlen Buffalo 14240 Vacancy John T. Keane PHILADELPHIA 19105 John W. Eckman David P. Eastburn Werner C. Brown Richard L. Smoot CLEVELAND* 44101 Robert E. Kirby Willis J. Winn Arnold R. Weber Walter H. MacDonald Cincinnati 45201 Lawrence H. Rogers, II Robert E. Showalter Pittsburgh 15230 G. Jackson Tankersley Robert D. Duggan RICHMOND* 23261 E. Angus Powell Robert P. Black Maceo A. Sloan George C. Rankin Baltimore 21203 I. E. Killian Jimmie R. Monhollon Charlotte 28230 Vacancy Stuart P. Fishburne Culpeper Communications and Records Center . 22701 Albert D. Tinkelenberg ATLANTA 30303 Clifford M. Kirtland, Jr. Monroe Kimbrel William A. Fickling, Jr. Kyle K. Fossum Birmingham 35202 Harold B. Blach, Jr. Hiram J. Honea Jacksonville 32203 Vacancy Charles B. East Miami 33152 Vacancy F. J. Craven, Jr. Nashville 37203 John C. Bolinger Jeffrey J. Wells New Orleans 70161 Vacancy George C. Guynn CHICAGO* 60690 Robert H. Strotz Robert P. Mayo John Sagan Daniel M. Doyle Detroit 48231 Jordan B. Tatter William C. Conrad ST. LOUIS 63166 Armand C. Stalnaker Lawrence K. Roos William B. Walton Donald W. Moriarty Little Rock 72203 G. Larry Kelley John F. Breen Louisville 40201 Vacancy Donald L. Henry Memphis 38101 Vacancy L. Terry Britt MINNEAPOLIS 55480 Stephen F. Keating Mark H. Willes William G. Phillips Thomas E. Gainor Helena 59601 Patricia P. Douglas John D. Johnson KANSAS CITY 64198 Harold W. Andersen Roger Guffey Joseph H. Williams Henry R. Czerwinski Denver 80217 A. L. Feldman Wayne W. Martin Oklahoma City 73125 Christine H. Anthony William G. Evans Omaha 68102 Durward B. Varner Robert D. Hamilton DALLAS 75222 Irving A. Mathews Ernest T. Baughman Gerald D. Hines Robert H. Boykin El Paso 79999 A. J. Losee Fredric W. Reed Houston 77001 Gene M. Woodfin J. Z. Rowe San Antonio 78295 Pat Legan Carl H. Moore SAN FRANCISCO 94120 Joseph F. Alibrandi John J. Balles Cornell C. Maier John B. Williams Los Angeles 90051 Caroline L. Ahmanson Richard C. Dunn Portland 97208 Loran L. Stewart Angelo S. Carella Salt Lake City 84125 Wendell J. Ashton A. Grant Holman Seattle 98124 Lloyd E. Cooney Gerald R. Kelly * Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 06096; Cranford, New Jersey 07016; Jericho, New York 11753; Utica at Oriskany, New York 13424; Columbus, Ohio 43216; Columbia, South Carolina 29210; Charleston, West Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee, Wisconsin 53202. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 74 Federal Reserve Board Publications Available from Publications Services, Division of Ad- request and be made payable to the order of the Board ministrative Services, Board of Governors of the Fed- of Governors of the Federal Reserve System. Remiteral Reserve System, Washington, D.C. 20551. Where tance from foreign residents should be drawn on a U.S. a charge is indicated, remittance should accompany bank. (Stamps and coupons are not accepted.) THE FEDERAL RESERVE SYSTEM—PURPOSES AND BANK CREDIT-CARD AND CHECK-CREDIT PLANS. 1968. FUNCTIONS. 1974. 125 pp. 102 pp. $1.00 each; 10 or more to one address, $.85 each. ANNUAL REPORT SURVEY OF CHANGES IN FAMILY FINANCES. 1968. 321 pp. $1.00 each; 10 or more to one address, $.85 FEDERAL RESERVE BULLETIN. Monthly. $20.00 per year or $2.00 each in the United States, its posses- each. sions, Canada, and Mexico; 10 or more of same REPORT OF THE JOINT TREASURY-FEDERAL RESERVE issue to one address, $18.00 per year or $1.75 STUDY OF THE U.S. GOVERNMENT SECURITIES each. Elsewhere, $24.00 per year or $2.50 each. MARKET. ,1969. 48 pp. $.25 each; 10 or more to one address, $.20 each. BANKING AND MONETARY STATISTICS, 1914-1941. JOINT TREASURY-FEDERAL RESERVE STUDY OF THE (Reprint of Part 1 only) 1976. 682 pp. $5.00. GOVERNMENT SECURITIES MARKET: STAFF STUD- BANKING AND MONETARY STATISTICS, 1941-1970. IES—PART 1. 1970. 86 pp. $.50 each; 10 or more 1976. 1,168 pp. $15.00. to one address, $.40 each. PART 2. 1971. 153 pp. ANNUAL STATISTICAL DIGEST, 1971-75. 1976. 339 pp. and PART 3. 1973. 131 pp. Each volume $1.00; $4.00 per copy for each paid subscription to Fed- 10 or more to one address, $.85 each. eral Reserve Bulletin. All others, $5.00 each. OPEN MARKET POLICIES AND OPERATING PROCE- ANNUAL STATISTICAL DIGEST, 1972-76. 1977. 388 pp. DURES—STAFF STUDIES. 1971. 218 pp. $2.00 $10.00 per copy. each; 10 or more to one address, $1.75 each. ANNUAL STATISTICAL DIGEST, 1973-77. 1978. 361 pp. REAPPRAISAL OF THE FEDERAL RESERVE DISCOUNT $12.00 per copy. MECHANISM. Vol. 1. 1971. 276 pp. Vol. 2. 1971. FEDERAL RESERVE CHART BOOK. Issued four times a 173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00; year in February, May, August, and November 10 or more to one address, $2.50 each. Subscription includes one issue of Historical Chart THE ECONOMETRICS OF PRICE DETERMINATION CON- Book. $7.00 per year or $2.00 each in the United FERENCE, October 30-31, 1970, Washington, D.C. States, its possessions, Canada, and Mexico. Else- 1972. 397 pp. Cloth ed. $5.00 each; 10 or more where, $10.00 per year or $3.00 each. to one address, $4.50 each. Paper ed. $4.00 each; HISTORICAL CHART BOOK. Issued annually in Sept. 10 or more to one address, $3.60 each. Subscription to Chart Book includes one issue. FEDERAL RESERVE STAFF STUDY: WAYS TO MODERATE $1.25 each in the United States, its possessions, FLUCTUATIONS IN HOUSING CONSTRUCTION . Canada, and Mexico; 10 or more to one address, 1972. 487 pp. $4.00 each; 10 or more to one $1.00 each. Elsewhere, $1.50 each. address, $3.60 each. CAPITAL MARKET DEVELOPMENTS. Weekly. $15.00 per LENDING FUNCTIONS OF THE FEDERAL RESERVE year or $.40 each in the United States, its posses- BANKS. 1973. 271 pp. $3.50 each; 10 or more sions, Canada, and Mexico; 10 or more of same to one address, $3.00 each. issue to one address, $13.50 per year or $.35 each. IMPROVING THE MONETARY AGGREGATES (Report of the Elsewhere, $20.00 per year or $.50 each. Advisory Committee on Monetary Statistics). 1976. 43 pp. $1.00 each; 10 or more to one SELECTED INTEREST AND EXCHANGE RATES—WEEKLY address, $.85 each. SERIES OF CHARTS. Weekly. $15.00 per year or $.40 each in the United States, its possessions, ANNUAL PERCENTAGE RATE TABLES (Truth in Lending—Regulation Z) Vol. / (Regular Transactions). Canada, and Mexico; 10 or more of same issue 1969. 100 pp. Vol. II (Irregular Transactions). to one address, $13.50 per year or $.35 each. 1969. 116 pp. Each volume $1.00, 10 or more Elsewhere, $20.00 per year or $.50 each. of same volume to one address, $.85 each. THE FEDERAL RESERVE ACT, as amended through De- FEDERAL RESERVE MEASURES OF CAPACITY AND CAcember 1976, with an appendix containing provi- PACITY UTILIZATION. 1978. 40 pp. $1.75 each, sions of certain other statutes affecting the Federal 10 or more to one address, $1.50. each. Reserve System. 307 pp. $2.50. THE BANK HOLDING COMPANY MOVEMENT TO 1978: REGULATIONS OF THE BOARD OF GOVERNORS OF THE A COMPENDIUM. 1978. 289 pp. $2.50 each, 10 FEDERAL RESERVE SYSTEM or more to one address, $2.25 each. PUBLISHED INTERPRETATIONS OF THE BOARD OF GOV- IMPROVING THE MONETARY AGGREGATES: STAFF ERNORS, as of June 30, 1978. $7.50. PAPERS. 1978. 170 pp. $4.00 each, 10 or more INDUSTRIAL PRODUCTION—1976 EDITION. 1977. 304 to one address, $3.75 each. pp. $4.50 each; 10 or more to one address, $4.00 1977 CONSUMER CREDIT SURVEY. 1978. 119 pp. $2.00 each. each. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Board Publications A 75 CONSUMER EDUCATION PAMPHLETS REPRINTS (Short pamphlets suitable for classroom use. Multiple (Except for Staff Papers, Staff Economic Studies, and copies available without charge.) some leading articles, most of the articles reprinted do CONSUMER HANDBOOK TO CREDIT PROTECTION LAWS not exceed 12 pages.) THE EQUAL CREDIT OPPORTUNITY ACT AND . . . AGE THE EQUAL CREDIT OPPORTUNITY ACT AND . MEASURES OF SECURITY CREDIT. 12/70. CREDIT RIGHTS IN HOUSING REVISION OF BANK CREDIT SERIES. 12/71. THE EQUAL CREDIT OPPORTUNITY ACT AND . . . ASSETS AND LIABILITIES OF FOREIGN BRANCHES OF DOCTORS, LAWYERS, SMALL RETAILERS, AND U.S. BANKS. 2/72. OTHERS WHO MAY PROVIDE INCIDENTAL CREDIT BANK DEBITS, DEPOSITS, AND DEPOSIT TURNOVER— THE EQUAL CREDIT OPPORTUNITY ACT AND . REVISED SERIES. 7/72. WOMEN YIELDS ON NEWLY ISSUED CORPORATE BONDS. 9/72. FAIR CREDIT BILLING RECENT ACTIVITIES OF FOREIGN BRANCHES OF U.S. A GUIDE TO FEDERAL RESERVE REGULATIONS BANKS. 10/72. HOW TO FILE A CONSUMER CREDIT COMPLAINT REVISION OF CONSUMER CREDIT STATISTICS. 10/72. IF YOU BORROW TO BUY STOCK ONE-BANK HOLDING COMPANIES BEFORE THE 1970 IF YOU USE A CREDIT CARD AMENDMENTS. 12/72. TRUTH IN LEASING YIELDS ON RECENTLY OFFERED CORPORATE BONDS. U.S. CURRENCY 5/73. RATES ON CONSUMER INSTALMENT LOANS. 9/73. WHAT TRUTH IN LENDING MEANS TO YOU NEW SERIES FOR LARGE MANUFACTURING CORPORA- TIONS. 10/73. U.S. ENERGY SUPPLIES AND USES', Staff Economic STAFF ECONOMIC STUDIES Study by Clayton Gehman. 12/73. Studies and papers on economic and financial subjects THE STRUCTURE OF MARGIN CREDIT. 4/75. that are of general interest in the field of economic NEW STATISTICAL SERIES ON LOAN COMMITMENTS AT SELECTED LARGE COMMERCIAL BANKS. 4/75. research. Summaries Only Printed in the Bulletin RECENT TRENDS IN FEDERAL BUDGET POLICY. 7/75. RECENT DEVELOPMENTS IN INTERNATIONAL FINANCIAL (Limited supply of mimeographed copies of full text MARKETS. 10/75. available upon request for single copies.) MINNIE: A SMALL VERSION OF THE MIT-PENN-SSRC ECONOMETRIC MODEL, Staff Economic Study by STRUCTURE AND PERFORMANCE STUDIES IN BANKING: Douglas Battenberg, Jared J. Enzler, and Arthur A SUMMARY AND EVALUATION, by Stephen A. M. Havenner. 11/75. Rhoades. Dec. 1977. 45 pp. AN ASSESSMENT OF BANK HOLDING COMPANIES, Staff AN ANALYSIS OF FEDERAL RESERVE ATTRITION SINCE Economic Study by Robert J. Lawrence and Sam- 1960, by John T. Rose. Jan. 1978. 44 pp. uel H. Talley. 1/76. PROBLEMS IN APPLYING DISCRIMINANT ANALYSIS IN INDUSTRIAL ELECTRIC POWER USE. 1/76. CREDIT SCORING MODELS, by Robert A. Eisenbeis. Jan. 1978. 28 pp. REVISION OF MONEY STOCK MEASURES. 2/76. SURVEY OF FINANCE COMPANIES, 1975. 3/76. EXTERNAL CAPITAL FINANCING REQUIREMENTS OF COMMERCIAL BANKS: 1977-81, by Gerald A. Han- REVISED SERIES FOR MEMBER BANK DEPOSITS AND weck and John J. Mingo. Feb. 1978. 34 pp. AGGREGATE RESERVES. 4/76. INDUSTRIAL PRODUCTION—1976 Revision. 6/76. MORTGAGE BORROWING AGAINST EQUITY IN EXISTING FEDERAL RESERVE OPERATIONS IN PAYMENT MECHA- HOMES: MEASUREMENT, GENERATION, AND IM- NISMS: A SUMMARY. 6/76. PLICATIONS FOR ECONOMIC ACTIVITY, by David F. Seiders. May 1978. 42 pp. RECENT GROWTH IN ACTIVITIES OF U.S. OFFICES OF BANKS. 10/76. THE BEHAVIOR OF MEMBER BANK REQUIRED RESERVE NEW ESTIMATES OF CAPACITY UTILIZATION: MANU- RATIOS AND THE EFFECTS OF BOARD ACTION, FACTURING AND MATERIALS. 11/76. 1968-77, by Thomas D. Simpson. July 1978. 39 BANK HOLDING COMPANY FINANCIAL DEVELOPMENTS pp. IN 1976. 4/77. FOOTHOLD ACQUISITIONS AND BANK MARKET STRUC- SURVEY OF TERMS OF BANK LENDING—NEW SERIES. TURE, by Stephen A. Rhoades and Paul Schweit- 5/77. zer, July 1978. 8 pp. THE COMMERCIAL PAPER MARKET. 6/77. INTEREST RATE CEILINGS AND DISINTERMEDIATION, by CONSUMPTION AND FIXED INVESTMENT IN THE ECO- Edward F. McKelvey. Sept. 1978. 105 pp. NOMIC RECOVERY ABROAD. 10/77. THE RELATIONSHIP BETWEEN RESERVE RATIOS AND RECENT DEVELOPMENTS IN U.S. INTERNATIONAL THE MONETARY AGGREGATES UNDER RESERVES TRANSACTIONS. 4/78. AND FEDERAL FUNDS RATE OPERATING TARGETS, THE FEDERAL BUDGET IN THE 1970'S. 9/78. by Kenneth J. Kopecky. Dec. 1978. 58 pp. SUMMARY MEASURES OF THE DOLLAR'S FOREIGN EX- CHANGE VALUE. 10/78. Printed in Full in the Bulletin SURVEY OF TIME AND SAVINGS DEPOSITS AT ALL COM- MERCIAL BANKS, JULY 1978. 11/78. Staff Economic Studies shown under "Reprints." REDEFINING THE MONETARY AGGREGATES. 1/79. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A76 Index to Statistical Tables References are to pages A-3 through A-68 although the prefix "A" is omitted in this index ACCEPTANCES, bankers, 11, 25, 27 Demand deposits: Agricultural loans, commercial banks, 18, 20-22, 26 Adjusted, commercial banks, 13, 15, 19 Assets and liabilities (See also Foreigners): Banks, by classes, 16, 17, 19, 20-23 Banks, by classes, 16, 17, 18, 20-23, 29 Ownership by individuals, partnerships, and Domestic finance companies, 39 corporations, 25 Federal Reserve Banks, 12 Subject to reserve requirements, 15 Nonfinancial corporations, current, 38 Turnover, 13 Automobiles: Deposits (See also specific types of deposits): Consumer instalment credit, 42, 43 Banks, by classes, 3, 16, 17, 19, 20-23, 29 Production, 48, 49 Federal Reserve Banks, 4, 12 Subject to reserve requirements, 15 Turnover, 13 BANKERS balances, 16, 18, 20, 21, 22 Discount rates at F.R. Banks (See Interest rates) (See also Foreigners) Discounts and advances by F.R. Banks (See Loans) Banks for cooperatives, 35 Dividends, corporate, 37 Bonds (See also U.S. Govt, securities): New issues, 36 EMPLOYMENT, 46, 47 Yields, 3 Euro-dollars, 27 Branch banks: Assets and liabilities of foreign branches of U.S. FARM mortgage loans, 41 banks, 56 Farmers Home Administration, 41 Liabilities of U.S. banks to their foreign Federal agency obligations, 4, 11, 12, 13, 34 branches, 23 Federal and Federally sponsored credit agencies, 35 Business activity, 46 Federal finance: Business expenditures on new plant and Debt subject to statutory limitation and equipment, 38 types and ownership of gross debt, 32 Business loans (See Commercial and industrial Receipts and outlays, 30, 31 loans) Treasury operating balance, 30 Federal Financing Bank, 30, 35 Federal funds, 3, 6, 18, 20, 21, 22, 27, 30 CAPACITY utilization, 46 Federal home loan banks, 35 Capital accounts: Federal Home Loan Mortgage Corp., 35, 40, 41 Banks, by classes, 16, 17, 19, 20 Federal Housing Administration, 35, 40, 41 Federal Reserve Banks, 12 Federal intermediate credit banks, 35 Central banks, 68 Federal land banks, 35, 41 Certificates of deposit, 23, 27 Federal National Mortgage Assn., 35, 40, 41 Commercial and industrial loans: Federal Reserve Banks: Commercial banks, 15, 18, 23, 26 Condition statement, 12 Weekly reporting banks, 20, 21, 22, 23, 24 Discount rates (See Interest rates) Commercial banks: U.S. Govt, securities held, 4, 12, 13, 32, 33 Assets and liabilities, 3, 15-19, 20-23 Federal Reserve credit, 4, 5, 12, 13 Business loans, 26 Federal Reserve notes, 12 Commercial and industrial loans, 24, 26 Federally sponsored credit agencies, 35 Consumer loans held, by type, 42, 43 Finance companies: Loans sold outright, 23 Assets and liabilities, 39 Number, by classes, 16, 17, 19 Business credit, 39 Real estate mortgages held, by type of holder and Loans, 20, 21, 22, 42, 43 property, 41 Paper, 25, 27 Commercial paper, 3, 24, 25, 27, 39 Financial institutions, loans to, 18, 20-22 Condition statements (See Assets and liabilities) Float, 4 Construction, 46, 50 Flow of funds, 44, 45 Consumer instalment credit, 42, 43 Foreign: Consumer prices, 46, 51 Consumption expenditures, 52, 53 Currency operations, 12 Corporations: Deposits in U.S. banks, 4, 12, 19, 20, 21, 22 Exchange rates, 68 Profits, taxes, and dividends, 37 Trade, 55 Security issues, 36, 65 Foreigners: Cost of living (See Consumer prices) Claims on, 60, 61, 66, 67 Credit unions, 29, 42, 43 Liabilities to, 23, 56-59, 64-67 Currency and coin, 5, 16, 18 Currency in circulation, 4, 14 Customer credit, stock market, 28 GOLD. Certificates, 12 Stock, 4, 55 DEBITS to deposit accounts, 13 Government National Mortgage Assn., 35, 40, 41 Debt (See specific types of debt or securities) Gross national product, 52, 53 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A 165 Federal Reserve Bulletin • January 1979 HOUSING, new and existing units, 50 REAL estate loans: Banks, by classes, 18, 20-23, 29, 41 INCOME, personal and national, 46, 52, 53 Life insurance companies, 29 Industrial production, 46, 48 Mortgage terms, yields, and activity, 3, 40 Instalment loans, 42, 43 Type of holder and property mortgaged, 41 Insurance companies, 29, 32, 33, 41 Reserve position, basic, member banks, 6 Insured commercial banks, 17, 18, 19 Reserve requirements, member banks, 9 Interbank deposits, 16, 17, 20, 21, 22 Reserves: Interest rates: Commercial banks, 16, 18, 20, 21, 22 Bonds, 3 Federal Reserve Banks, 12 Business loans of banks, 26 Member banks, 3, 4, 5, 15, 16, 18 Federal Reserve Banks, 3, 8 U.S. reserve assets, 55 Foreign countries, 68 Residential mortgage loans, 40 Money and capital markets, 3, 27 Retail credit and retail sales, 42, 43, 46 Mortgages, 3, 40 Prime rate, commercial banks, 26 SAVING: Time and savings deposits, maximum rates, 10 Flow of funds, 44, 45 International capital transactions of the United National income accounts, 53 States, 56-67 Savings and loan assns., 3, 10, 29, 33, 41, 44 International organizations, 56-61, 64-67 Savings deposits (See Time deposits) Inventories, 52 Savings institutions, selected assets, 29 Investment companies, issues and assets, 37 Securities (See also U.S. Govt, securities): Investments (See also specific types of investments): Federal and Federally sponsored agencies, 35 Banks, by classes, 16, 17, 18, 20, 21, 22, 29 Foreign transactions, 65 Commercial banks, 3, 15, 16, 17, 18 New issues, 36 Federal Reserve Banks, 12, 13 Prices, 28 Life insurance companies, 29 Special Drawing Rights, 4, 12, 54, 55 Savings and loan assns., 29 State and local govts.: Deposits, 19, 20, 21, 22 LABOR force, 47 Holdings of U.S. Govt, securities, 32, 33 Life insurance companies (See Insurance companies) New security issues, 36 Loans (See also specific types of loans): Ownership of securities of, 18, 20, 21, 22, 29 Banks, by classes, 16, 17, 18, 20-23, 29 Yields of securities, 3 Commercial banks, 3, 15-18, 20-23, 24, 26 State member banks, 17 Federal Reserve Banks, 3, 4, 5, 8, 12, 13 Stock market, 28 Insurance companies, 29, 41 Stocks (See also Securities): Insured or guaranteed by U.S., 40, 41 New issues, 36 Savings and loan assns., 29 Prices, 28 MANUFACTURING: TAX receipts, Federal, 31 Capacity utilization, 46 Time deposits, 3, 10, 13, 15, 16, 17, 19, 20, 21, Production, 46, 49 22, 23 Margin requirements, 10 Trade, foreign, 55 Member banks: Treasury currency, Treasury cash, 4 Assets and liabilities, by classes, 16, 17, 18 Treasury deposits, 4, 12, 30 Borrowings at Federal Reserve Banks, 5, 12 Treasury operating balance, 30 Number, by classes, 16, 17, 19 Reserve position, basic, 6 UNEMPLOYMENT, 47 Reserve requirements, 9 U.S. balance of payments, 54 Reserves and related items, 3, 4, 5, 15 U.S. Govt, balances: Mining production, 49 Commercial bank holdings, 19, 20, 21, 22 Mobile home shipments, 50 Member bank holdings, 15 Monetary aggregates, 3, 15 Treasury deposits at Reserve Banks, 4, 12, 30 Money and capital market rates (See Interest rates) U.S. Govt, securities: Money stock measures and components, 3, 14 Bank holdings, 16, 17, 18, 20, 21, 22, 29, Mortgages (See Real estate loans) 32, 33 Mutual funds (See Investment companies) Dealer transactions, positions, and financing, 34 Mutual savings banks, 3, 10, 20-22, 29, 32, 33, 41 Federal Reserve Bank holdings, 4, 12, 13, 32, 33 Foreign and international holdings and NATIONAL banks, 17, 19 transactions, 12, 32, 64 National defense outlays, 31 Open market transactions, 11 National income, 52 Outstanding, by type of security, 32, 33 Nonmember banks, 17, 18, 19 Ownership, 32, 33 Rates in money and capital markets, 3, 27 OPEN market transactions, 11 Yields, 3 Utilities, production, 49 PERSONAL income, 53 Prices: VETERANS Administration, 40, 41 Consumer and wholesale, 46, 51 Stock market, 28 WEEKLY reporting banks, 20-24 Prime rate, commercial banks, 26 Wholesale prices, 46 Production, 46, 48 Profits, corporate, 37 YIELDS (See Interest rates) Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A78 The Federal Reserve System Boundaries of Federal Reserve Districts and Their Branch Territories Minneapolis Detroit Chicago Omaha* jSalt Lake City Denver Kansas City t. \ L s) o ui . s Louisville fichjn?5 'harlottej IOklahoma City. ^mphisNashvM ls Angeles \ 0 > ,ittle Rock sirminghai Atlanta Dallas® 7lPas~o Ja< kson Houston San Antonio January 1978 ALASKA LEGEND — Boundaries of Federal Reserve Districts ® Federal Reserve Bank Cities Boundaries of Federal Reserve Branch • Federal Reserve Branch Cities Territories Federal Reserve Bank Facility Q Board of Governors of the Federal Reserve System Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis