Full text of E.8 Volume and Composition of Individuals' Saving : July 1953

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For Release in MORNING Newspapers of Friday, July 10, 1953
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SECURITIES
AND EXCHANGE COMMISSION
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Washington, D. C.
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STATISTICAL SERIES'
Release No. 1172
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VOLUME AND COMPOSITION OF INDIVIDUALS' SAVING, JAN.-MAR., 1953 l/
Individuals saved $2.5 billion in liquid form during the first quarter of 1953,
according to estimates made public today by the Securities and Exchange Commission.
This rate of saving was slightly higher than in the first quarter of 1952 and was the
highest for any first quarter of the post-war period. Following the usual pattern,
liquid saving was substantially less than in the fourth quarter of 1952, primarily
reflecting payment of income taxes.
The composition of saving in the first quarter differed slightly from that of
the same period last year. While saving of the more permanent types, such as savirgs
accounts in banks, insurance, and purchase of shares in savings and loan associations,
continued at or near the high rates of recent periods, individuals' investments in
securities — mainly United States Government bonds
were greater than at any time
since the first quarter of 19b7. Offsetting the rise in these liquid asset holdings,
individuals increased their mortgage indebtedness somewhat more than in the first
quarter of last year, and instead of the usual first quarter repayment of consumer
debt, expanded their aggregate installment indebtedness.
Individuals' net investments in U. S. Government issues rose by $1.8 billion
during the first quarter of 1953. This increase reflects a substantial liquidation
of government securities by institutions, chiefly commercial banks, and includes
an increase of $1|00 million in individuals' holdings of U. S. Savings Bonds. In the
corresponding period of 1952 there was an increase of $100 million in holdings of
Savings Bands.
Corporate stocks and bonds purchased by individuals in the first three months
of this year amounted to over $600 million, compared with $1.0 billion in the
preceding quarter and $900 million in the first quarter of 1952. The lower amount
of corporate security purchases relative to the fourth quarter mainly reflected the
smaller volume of securities offerings in the first three months of 1953. Of total
corporate securities purchased by individuals in the first quarter of this year,
somewhat under $200 million were bonds and notes, and somewhat under $500 million were
common and preferred stock issues.
Although a large volume of state and local securities was marketed during the
first quarter it is e stimted that institutional investors absorbed almost all of
the new issues.
The usual seasonal contraction in individuals' holdings of currency and demand
deposits in banks took place during the first quarter. Currency holdings were
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. Liquid saving comprises saving in the form of currency and
bank deposits, equity in savings and loan associations, private and government
insurance, securities, and repayment of mortgage debt and other consumer debt.




reduced by almost $250 million, while demand deposits were drawn down by $2*2
billion* Individuals1 time and saving deposits in banks rose by over $900
million, compared with $1*2 billion in the preceding quarter, and $1*0 billion
in the first quarter of 1952* During the first quarter investments in shares
of savings and loan associations, net of withdrawals, amounted to over $900
million, almost as high as the record $1*0 billion of the preceding quarter*
In addition, individuals1 saving in insurance, including private life insurance
and Government pension reserves, such as Social Security funds, amounted to $2,2
billion. In the first quarter of 1952 saving in insurance was about $200 million
higher; the lower figure this year was due to less saving in the form of Government
insurance resulting from larger benefit payments under the old-age and survivors1
insurance system* Saving in private insurance which had reached a record $1*1*
billion in the final quarter of 1952 was at the same rate as the first quarter of 1952,
$1*2 billion*
During the first quarter of this year consumer indebtedness of individuals
increased by almost $200 million. While charge accounte at retail stores were
reduced by almost $500 million, these repayments were more than offset by a further
expansion in installment credit for the most part incurred in connection with
purchases of automobiles» Despite large repayments, mortgage indebtedness was
increased by $1*U billion and was associated with the high level of home construction
during the period*
In addition to the concept of liquid saving discussed above there are ether
concepts of individuals * saving with varying 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 individuals1 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 States 1/
1948 - 1953
(Billions of dollars)

Jan.Mar.

1952 2/
Apr.JulyJune
Sept.

-1.9
-0.3
-2.7
1.0

0.9
0.4
-0.7
1.1

3.6
0.4
2.4
0.9

4.5
0.6
2.6
1.2

-1.5
—0.2
-2.2
0.9

Oct.Dec.

1953
Jan.Mar.

Type of Saving

1948

1949

1950

1351

1952 2/

1.

Currency and bank deposits
a. Currency
b. Demand deposits
c. Time and savings deposits

-1.8
-0.5
-2.2
0.8

-1.4
-0.8
-1.4
0.9

4.2
(*)
3.8
0.5

5.7
0.8
3.0
1.9

7.1
1.2
1.7
4.3 .

2.

Savings and loan associations

1.2

1.5

1.5

2.1

3.1

0.7

0.9

0.5

1.0

0.9

3.

Insurance
a. Private
b. Government

7.3
3.7

6.1
3.7
2.3

5.0
3.9
1.1

8.2
4.0
4.2

9.4
4.8
4.6

2.4
1.2
1.2

2.4
1.0
1.4

2.4
1.2
1.2

2.2
1.4
0.8

2.2
1.2
0.9

4.

Securities 3/
a. U. S. savings bonds
b. Other V. S. Government
c. State and local government
d. Corporate and other

3.3
2.1
-1.5
1.1
1.6

2.7
1.5
-0.3
0.9

1.1
0.6
-1.2
0.5
1.3

2.8
-0.4
-0.3
0.3
3.1

4.6
0.3
-0.5
0.9
3.8

1.8
0.1
0.8
(*)
0.9

0.2
(*)
-1.1
0.3
1.0

1.3
0.1
-0.2
0.6
0.9

1.3
0.2
-0.1
0.1
1.0

2.5
0.4
1.4
0.1
0.6

5.

Liquidation of mortgage debt 4/

• ^4.6

-3.9

-7.2

-6.4

-6.0

-1.3

-1.4

-1.6

-1.6

-1.4

b.

Liquidation of debt not elsewhere
classified 5/

-2.3

-2.4

-3.2

-0.5

-2.8

0.7

-1.6

-0.9

-2.0

-0.2

3.0

2.7

1.5

11.9

14.4

2.4

1.4

5.4

5.3

2.5

8.5

8.1

12.6

11.5

11.6

2.3

2.9

3.2

3.2

2.5

22.9

23.9

29.2

26.8

25.8

5.5

6.4

6.0

7.9

6.6

34.3

34.7

43.3

50.3

51.8

10.2

10.6

14 i 6

16.4

11.6

7.

Total liquid saving

8.

Nonfarm dwellings 6/

9.
10.

Other durable consumers
Total Gross Saving

3.G

1

goods

0.6

1/ Includes unincorporated business saving of the types specified.
2/ Revised
3/ After deducting change in bank loans made for the purpose of purchasing or carrying securities.
4/ Mortgage debt to institutions on one-to four-family nonfarm dwellings.
5/ Largely attributable to purchases of automobiles and other durable consumers' goods, although including some debt arising from purchases
of consumption goods. The other segments of individuals' debt have been allocated to the assets to which they pertain, viz., saving in
insurance and securities. Data revised on basis of the new Federal Reserve consumer credit series.
6/ Construction of one-to four-family nonfarm dwellings less net acquisition of properties by non-individuals j 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.