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For Release in MORNING Newspapers of Wednesday

y 5, 1955
>

SECURITIES AND EXCHANGE COMMISSION
H .
i
Washington, D. C.

v

ii

STATISTICAL SERIES'
'855
Release No. 1280 LiBRARY
VOLUME AND COMPOSITION OF INDIVIDUALS' SAVING, JULY-SEPT., 195U-^
Individuals in the United States saved #2.7 billion in liquid form during
the third quarter of 195U, according to estimates made public today by the
Securities and Exchange Commission. This rate of saving was slightly lower than
in the second quarter of this year,
A significant development in the pattern of saving during the third quarter
was a considerable rise in individuals' bank deposits, chiefly in checking
accounts. This increase was offset by a liquidation of government securities
by individuals and a sharp rise in mortgage indebtedness. During the three
months July through September individuals' holdings of United States Government
bonds, other than Savings Bonds, were reduced by $1.6 billion. Holdings of
state and local government securities declined for the first time in three
years. While individuals continued to make substantial net purchases of corporate
and other securities, these purchases were less than in the two preceding
quarters.
Individuals' holdings of currency and bank deposits increased by $3.5
billion during the third quarter, comprised of a growth in demand deposits of
$2.7 billion, a rise in time and savings deposits of $900 million, and a decline
in currency holdings of $100 million. The third quarter figures may be compared
with a rise in currency and bank deposits of $l,h billion in the second quarter
of 195U and $1.7 billion in the third quarter of 1953.
Net purchases of corporate and other securities by individuals during the
third quarter of 195U amounted to $700 millionj this was $300 million less than
in the second quarter, and $1:00 million less than in the first quarter of 195U.
Almost all of the increase in corporate securities investments was in debt
issues. Little change occurred in individuals' holdings of corporate stock,
primarily reflecting a smaller volume of new stock issues during the quarter and
an increase in retirements.
Individuals' holdings of United States Government Savings Bonds increased
by $100 million while equity in other U. S. Government securities declined
$1.6 billion. The decline in holdings of these Government issues, also large
in the preceding quarter, apparently was due to substantial maturities of

1/ Individuals' saving, in addition to personal holdings, covers saving of unincorporated business, trust and pension funds and non-profit institutions in
the forms specified. Individuals' liquid saving comprises saving in the
form of currency and bank deposits, equity in savings and loan association?,
private and Government insurance, securities, and repayment of mortgage debt
and other consumer debt*



S - 1280
Government securities in these months. Holdings of state and local government
securities decreased $300 million, compared -with increases of $U00 million and
$300 million, respectively, in the two preceding quarters. During the third
quarter, the net increase in state and local government issues outstanding was
less than in the preceding quarters while institutional investors continued to
absorb about the same amount as previously, resulting in net sales by individuals.
Individuals' equity in insurance and pension reserves increased by
$2.1 billion, about the same as in recent quarters. Equity on private insurance
rose by $1,U billion, while government insurance and pension reserves (Social
Security, etc,) increased by $700 million. Individuals increased their holdings
of savings and loan shares by $700 million during the third quarter.
In addition to the above changes in liquid assets, mortgage debt on nonfarm dwellings increased $2.3 billion during the quarter, a record amount,
reflecting the high level of construction activity. Consumed indebtedness was
practically unchanged during the period.
In addition to the concept of liquid saving discussed above, there are
other concepts of individuals' saving with different degrees of coverage currently in use. The series with the most complete coverage, the personal saving
estimates of the Department of Commerce, is derived as the difference between
personal income and expenditures. Conceptually, Commerce saving includes the
following items not included with S.E.C. liquid saving: Housing net of depreciation, unincorporated business and farm items such as net plant and equipment,
changes in net receivables and changes in inventories. Government insurance
is excluded from Commerce saving,
A more restricted concept of individuals' saving is the selected items
series of the Federal Home Loan Bank Board. This series covers the following
components included in S.E.C, liquid saving: Time and savings deposits, savings and
loan associations, private life insurance, and U. S. Savings Bonds»




Saving by Individuals in the United Statesi^

1950 - 195b
(Billions of dollars)
Type of Saving

19#

1*

3.6
—0 • 1
3.2
0.4

2*
3.

Currency and bank deposits
a. Currency
b* Demand deposits
c* Time and savings deposits
Savings and loan associations
Insurance
a. Private
b* Government

1.5

1951

1952

1953

6.0
0.8
3.2
2.0

7.1
l.l
1.7
U.2

U.7
0*6
-0.1
U.2

2.1

5.0
3.9
1.1

3.1

3.7

1953
j Oct.JulySept.
| Dec.
1.7
(*)
0.9
0*8

-2*2
-1.0
-2*5
1.3

1951
Apr*- 1
|
June

|

1.4
0.1
-0.1
1.3

1

0.6

j

1.1

1.1

!

1.9
1.5
0.4

2.0
1.4
0*6

1
1
i
1
i
1
,

8.3
5.1
3.2

2*1
1.2
0*9

kok

3.7
0.6
2.1
1.0

j
|

1

9.3
1.9

8*3
4.0
il.2

I
|
|
I
|

Jan.Mar*

|
1

"
1.3
2.1
1.3
0.8

JulySept.

|
1
1

3.5
-0.1
2*7
0.9

1
1

0.7

0.5
0.2
-1.1
0.4
1.0

1
1
i
I
!
1
1
|
1

2.1
l.ii
0.7
-1.1
0.1
-1.6
*0.3
0.7

-1.9

'
1

-2.3

4.

Securities-?/
a. U. S* savings bonds
b. Other U* S. Government
c. State and local government
d. Corporate and other

2*0
0*6
-0.6
0.7
l.ii

2.6
—0.4
-0.6
0.4
3.2

4.2
0*3
-0.7
0*9
3.7

6*2
0*3
1*0
1.8
3.0

1.1
0.1
—0.1
0.1;
0.7

1
1
0*2
1 0.1
! *1*0
1 0.6
!
0.5

2.5
0.2
0.8
0.3
1.1

5.

Liquidation of mortgage debt^/

-7.2

*6.5

*6.3

-6.7

-1.8

-1.5

-1.3

6.

Liquidation pf debt not elsewhere
classifiedii/

*3.2

*0.5

*3.8

*2*8

—0 e 5

' —0*8

1.5

i

-0.lt

!
|

-0.1

Total Liquid Saving

1*8

11.8

13.6

13

3.2

1

4.7

3 . 6

1

2 . 9

1

2 . 7

8 * N onfarm dwellings^/

12.6

H.5

11.6

12.3

3.1

|

3.2

2 . 6

]

3.3

1

3.9

9.

Other durable consumers * goods

29.2

27.3

26*7

30.1

7.4

8.1*

6 . 3

j

7 . 5

|

6 . 8

Total Gross Saving

to.

50.6

51.8

55.8

1U.0

16.3

12.lt

J

13.7

7.

10*

1
1

6

13.5

l/ Includes unincorporated business saving of the types specified,
2/ After deducting change in bank loans made for the purpose of purchasing or carrying securitiese
3/ Mortgage debt to institutions on one* to four-family nonfara dwellings«
b/ Largely attributable to purchases of automobiles and other durable consumers1 goods, although including some debt arising from
purchases of consumption goods e The other segments of individuals' debt have been allocated to the assets to which they per*
tain, viz*, saving in insurance and securities*
5/ Construction of one* to four-family nonfarm dwellings less net acquisition of properties by non-individuals\ also includes a
small amount of construction of nonprofit institutions.
NOTE:



Figures are rounded and will not necessarily add to totals. Asterisk (*) indicates less than $50 million. The foregoing
data have been compiled by the Commission from many different sources. Because of the nature of the figures, current data
are necessarily estimates and, therefore, are subject to revision*