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BOARD OF GOVERNORS DF THE FEDERAL RESERVE SYSTEM Office Correspondence Xo From flhfl.iraifl.n "R^clftR Date, Aug^t 22, Subject t Xjiqi,^^ flssftts of Lt M Pig^r t According to the Securities and Exchange Commission, corporations at the end of 1943 held 38•& billion dollars of liquid assets, divided between 22*6 billion of cash and 16 billion of United States Government securities• Mr. Roland Robinson estimates that at the end of 1 9 ^ the total liquid assets of corporations will have increased further by J billion dollars• This amount will include perhaps 21*6 billion dollars of cash and 2I4. billion of Government securities• During I9I4.5, liquid assets of corporations may increase further by about 2 billion dollars, with probably all of the increase in Government securities* During I9I4.6, however, there will be a decline of perhaps !j.«5 billion dollars, probably all in Government securities. This decline will result principally from the fact that tax payments will be in excess of currently accruing tax liabilities* These forecasts of liquid assets assume (1) that the European phase of the war is over at the end of this year and the Pacific phase at the end of I9I4.5, (2) that war expenditures will decline to an average of 5 billion dollars a month in the second half of I9I4.5 and to 2 billion a month in the second half of I9I46, (3) "that the conversion from war to peace production will be smoothly handled, and (1+) that private capital formation will increase in I9I+5 and 19^6 and in the latter year will be well above the level of any prior year except 19U1
