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CONFIDENTIAL (FR) SUPPLEMENT CURRENT ECONOMIC AND FINANCIAL CONDITIONS Prepared for the Federal Open Market Committee By the Staff Board of Governors of the Federal Reserve System July 17, 1970 SUPPLEMENTAL NOTES The Domestic Economy Gross national product. / Preliminary Commerce estimates indicate that GNP increased $10.6 billion in the second quarter, to an annual rate of $970.1 billion; this compares with an increase of $7.8 (revised) in the first quarter. In real terms, GNP was virtually unchanged--up .3 per cent at an annual rate. In the first quarter, according to the revised estimates, real GNP declined at an annual rate of 3.0 per cent, following a .9 per cent rate of decline in the fourth quarter of 1969. The improved performance in the second quarter was mainly attributable to inventories. Accumulation rose to an annual rate of $2.6 billion, from $1.6 billion in the first quarter; in contrast the rate of accumulation had declined substantially in the preceding two quarters. Final purchases in the second quarter rose by $9.6 billion, the smallest increase in over three years. Business fixed investment was unchanged, as it also had been in the first quarter on the basis of revised data. In constant dollars, such investment has been declin- ing in recent quarters. The rise in State and local government purchases of goods and services was smaller than in the previous quarter. Personal income and disposable income rose by more than $19 and $19.5 billion, respectively, for the most part reflecting special 1/ Figures through the second quarter of 1970 are contained in the tables at the end of this Supplement. - 2- factors. Despite these large increases, consumption expenditures rose only a little more than in the two preceding quarters, when income gains were much more moderate, and the saving rate rose sharply to 7.6 per cent, from 6.7 per cent in the first quarter. The GNP implicit deflator rose at a rate of 4.2 per cent in the second quarter, much less rapid than the 6.4 per cent rate of the first. For private GNP--which excludes the effect of changes in government pay scales--the implicit deflator rose at an annual rate of 4.1 per cent in the second quarter, as compared with 5.3 per cent in the first. The slowing of the rise was mainly due to the changing composition of GNP rather than to deceleration in the rate of inflation. Personal income declined $1 billion in June to a seasonally adjusted annual rate of $798.8 billion, reflecting a decline of $3.7 billion in government payrolls resulting from the concentration in April and May of the retroactive portion of the Federal pay raise. Wages and salaries rose $1.8 billion in the private sector in June, following a negligible increase in the previous month and a decline in April. More than $1 billion of the June advance was in the distributive industries where increased employment and higher pay rates in the transportation industries accounted for most of the gain. Payrolls in manufacturing, recorded a slight rise in June after two months of substantial declines. Higher hourly earnings were responsible for the June increase, as employment dropped sharply and weekly hours were unchanged. -3PERSONAL INCOME, 1970 (Seasonally adjusted, in billions of dollars) March Change from prior month April May June 6.1 18.4 -6.2 -1.0 3.9 0.5 3.4 1.3 2.1 4.9 6.7 -1,8 -1.3 -0.5 0.7 0.5 0.2 -0.8 1.0 -1.9 -3.7 1.8 0.3 1.5 1.4 0.8 13.0 0.5 -7.5 0.6 0.9 0 Total personal income Wages and salaries Government Private Manufacturing Nonmanufacturing Transfer payments All other Seasonally adjusted private housing starts, which were revised upward by 2 per cent for May, rose more than a tenth further in June to an annual rate of 1.36 million units. This was the highest rate since March and brought the average for the second quarter as a whole to 1.27 million units or slightly above the reduced average in the first quarter of the year. The advance in June was largely in single-family starts, which until that month had been exceptionally low this year. multifamily starts also increased in June. However, Regionally, only the North- east showed a month-to-month decline in total starts. Seasonally adjusted building permits declined only slightly in June after a sharp two-month surge. Mainly reflecting this develop- ment, indications are that starts in July may hold near the improved rate reached in June, even allowing for the extreme volatility of the monthly starts series. This suggests the possibility of a third quarter average at least moderately higher than the 1.33 million rate projected before the June report became available. PRIVATE HOUSING STARTS AND PERMITS June June 1970 10 Per cent change from (Thousands of units) ./ May 1970 June 1969 1,358 11 -10 1-family 2-or-more-family 818 540 14 6 - 1 -21 Northeast North Central South West 171 288 585 314 -8 39 4 22 -30 -11 - 2 - 8 -1 - 3 -1 -3 - 4 - 2 Starts- / Permits 1-family 2-or-more-family 1,302 604 698 1/ Seasonally adjusted annual rates; preliminary. 2/ Apart from starts, mobile home shipments for domestic use in May-the latest month for which data are available were at a seasonally adjusted annual rate of 363,000 (FRB series), 4 per cent below a year earlier. -5The Domestic Financial Situation Nonbank thrift institutions. Complete sample data confirm that savings and loan association outflows during the recent reinvestment period were extremely small. which was general This promising deposit picture, across the country, suggests that S and L net mortgage lending activity will probably increase in coming months. SAVINGS AND LOAN ASSOCIATION DEPOSIT FLOWS JUNE-JULY REINVESTMENT PERIOD (Millions of dollars) 1/ July 4-101966 1967 1968 1969 1970 Total reinvestment period n.a. n.a. 161 65 395 -2,121 -593 -1,109 -1,506 -251 1/ Five business days for all the years shown. 2/ Includes the last three business days of June and the first business days of July. ten New York City mutual savings banks continued to exhibit a deposit picture that is not quite as strong as that for S&L's. During the first half of July, these institutions received a net deposit gain that was smaller than in 1966 and 1967, but contrasts with a large net outflow during the comparable period last year. 15 LARGEST NEW YORK CITY SAVINGS BANKS NET DEPOSIT FLOWS--FIRST 15 DAYS OF JULY In millions of dollars 1966 1967 1968 1969 1970 116 62 10 -132 17 As per cent of deposits .76 .36 .05 -. 70 .09 -6- Mortgage rates. During June, returns on home mortgages remained essentially unchanged, with conventional mortgage rates continuing at the 8.55 per cent level reached last January. Relative to new issues of high-grade corporate bonds, home mortgages again offered no net investment incentive for diversified lenders. AVERAGE RATES AND YIELDS ON SELECTED NEW-HOME MORTGAGES Primary market: Conventional loans Yield spread Level (per cent) (basis points) Secondary market: FHA-insured loans Yield Level spread Discount (points) (per cent) (basis points) 1969 Low High 7.55 (Jan.) 8.35 (Nov., Dec.) -40 (Dec.) 69 (Feb.) 7.85e (Jan.) 8.62 (Dec.) -13 (Dec.) 108 (Feb.) 2.8e (Jan.) 8.7 (Dec.) 1970 January February March 8.55 8.55 8.55 9 25 -5 9.25e 9.29 9.20 79e 99 60 5.7e 6.0 5.3 April May June 8.55 8.55 8.55 -5 -55 -56 9.10 9.11 9.16 50 1 5 4.6 4.7 5.0 Note: FHA series; interest rates on conventional first mortgages (excluding additional fees and charges) are rounded to the nearest 5 basis points. On 8-1/2 per cent FHA loans, a change of 1.0 points in discount is associated with a change of 13 to 15 basis points in yield. Gross yield spread is average mortgage return, before deducting servicing fees, minus average yield on new issues of high grade corporate bonds with 5-year call protection. e/ estimated. Emergency Home Finance Act of 1970. distributed, Since the Greenbook was the House-Senate Conference Committee agreed on a single version of the Emergency Home Finance Act of 1970. In major actions, the House-Senate conferees decided to drop Title VII of the House-pased - 7 version, which would have given the Federal Reserve Board discretionary authority to allow member banks to invest a designated portion of their required reserves in the obligations of housing-oriented Federal agencies. In addition, the conferees voted to increase the annual authorizations under Title V of the Senate version from $60 to $105 million, to subsidize the purchase of lower interest rate mortgages for middle-income familites.1/ Finally, the conferees decided to drop the dual interest rate plan of the Senate, and simply extend the authority of Secretary of HUD to set the maximum ceiling rates on FHA and VA mortgages until October 1971. 1/ It is our understanding that there will be no funding of this program before October. -8INTEREST RATES Late 1969 1 Highs Lows 1970 June 22 July 16 Short-Term Rates Federal funds (weekly averages) 9.32 (12/11) 7.45 (3/25) 3-months Treasury bills (bid) Bankers' acceptances Euro-dollars Federal agencies Finance paper CD's (prime NYC) Highest quoted new issue Secondary market 8.08 (12/29) 9.00 (12/31) 11.56 (12/18) 8.39 (11/20) 8.25 (12/3) 7.80 (6/17) 7.59 (7/15) 6.08 (3/24) 6.54 6.38 7.63 7.13 (3/30) 7.63 8.94 8.00 (4/20) 9.49 6.80 (4/10) 7.26 (6/19) 6.53 7.56 7.25 (4/28) 7.50 6.00 6.75 9.05 (12/31) 7.19 (4/3) 6.75 8.12 6.75 8.05 8.09 (12/29) 9.00 (12/31) 9.25 (12/31) 6.18 (3/23) 7.25 (3/30) 7.88 (3/30) 8.58 (11/20) 6.91 (4/17) 6.83e 7.65i 8.25 7.66 (6/19) 6.42 7.65 e 8.25 7.14 6.25 7.00 9.15 (12/31) 7.00 (4/1) 7.00 8.25 7.00 8.05 7.86 (11/24) 6.20 (4/13) 6.25 (12/12) 3.80 (3/27) 7.12 8.33 (12/29) 7.05 (3/25) 7.14 (12/29) 6.55 (2/27) 7.88 7.36 7.48 6.93 Corporate Seasoned Aaa Baa 7.91 (12/31) 7.78 (3/10) 8.91 (12/31) 8.57 (3/10) 8.58 9.30 8.49 9.38 New Issue Aaa No call protection Call protection 8.85 (12/5) 9.30 (6/17) 8.58 6-month Treasury bills (bid) Bankers' acceptances Commercial paper (4-6 months) Federal agencies CD's (prime NYC) Highest quoted new issue Secondary market 1-year Treasury bills (bid) Prime municipals 6.57 5.40 (6/17) 4.90 Intermediate and Lone-Term Treasury coupon issues 5-years 20-years 8.20 (2/27) Municipal Bond Buyer Index Moody's Aaa Mortgage--implicit yield in FNMA auction 1/ 6.90 (12/19) 5.95 (3/12) 6.57 (12/26) 5.75 (3/12) 7.03 (6/17) 6.60 6.95 (6/17) 6.50 8.87 (12/29) 9.04 (4/20) 9.30 (6/15) 9.21 (7/13) 1/ Yield on 6-month forward commitment after allowance for commitment fee and required purchase and holding of FNMA stock. Assumes discount on 30-year loan amortized over 15 years. e--estimated. REVISION OF U.S. NATIONAL INCOME AND PRODUCT ACCOUNTS. 1967-1969* The annual revision of the national income and product accounts this July does not change appreciably the pattern of over-all economic activity depicted by the earlier figures. According to the revised figures, constant dollar GNP rose at an average annual rate of 3.3 per cent from the end of 1966 to its peak in the third quarter of last year; this is about the same as had been indicated by the former figures. From the third quarter of 1969 to the first quarter of this year real GNP declined at an average annual rate of 1.9 per cent according to the revised estimate--slightly more than the 1.7 per cent decline indicated earlier. The revised GNP implicit price deflator shows virtually the same increases as the earlier figures. Some comparisons of the revised and former estimates of key expenditure and income items are included in Tables A-1 and A-2. The revised income and product figures regularly carried in the Greenbook, along with the other items on the GNP tables, are shown following Tables A-1 and A-2. The cumulative effect of the revisions in total GNP in current dollars is negligible--GNP in the fourth quarter of 1968 is revised down by only .1 per cent and by even less in the fourth quarter of 1969. Larger revisions were made in some of the expenditure com- ponents in some quarters, but for the most part these revisions are also quite moderate. * Prepared by J. C. G. Peret, Senior Economist, National Income, Labor Force, and Trade Section, Division of Research and Statistics. - 2 Personal income, disposable income and personal taxes are now indicated to be a little higher in the fourthiquarter of 1969, although wages and salaries have hardly been modified. The QIV 1969 saving rate is a bit lower than shown earlier. Corporate profits before tax have been revised down throughout the period and in the fourth quarter of 1969 are $2.9 billion below the preceding estimate. Corporate profits are now shown to have risen a little more in the first half of 1969 than indicated earlier and to have declined more in the second half. The revised figures also show smaller quarterly deficits (N.I.A. basis) for Federal government during 1967 and larger deficits in 1968; in 1969 the revised quarterly surpluses are smaller than indicated earlier except for the third quarter. For State and local governments the quarter deficits are generally smaller than indicated earlier. TABLE A-1 CHANGES IN NATIONAL INCOME AND PRODUCT ESTIMATES (Per cent change from year earlier) 1967-IV Former Rev. Est. Est. 1968-IV IFormer Rev. Est. Est. 1969-IV Former Rev. Est. Est. 5.9 7.3 9.4 9.3 9.3 9.5 5.9 -2.3 30.3 1.0 5.9 -2.5 30.3 -0.1 9.6 8.6 10.8 7.6 9.6 7.8 10.1 8.9 7.0 5.9 -0.9 12.0 7.6 5.7 -4.1 12.0 13.9 13.7 14.5 14.0 13.9 14.5 9.0 6.3 19.0 8.9 6.0 20.1 0.4 -0.1 2.7 0.2 -0.5 2.6 11.9 11.9 12.8 12.7 10.7 9.1 Personal income Wage and salary disbursements Personal tax and nontax payments 6.8 7.1 6.8 7.1 10.1 10.4 10.2 10.4 7.9 8.9 8.1 9,1 8.4 8.7 24.3 23.4 12.1 13.8 Disposable income 6.5 6.5 7.9 8.2 7.1 7.4 Corporate profits before tax 1.4 0.1 12.0 9.6 -3.3 -3.1 6.4 11.7 6.7 11.7 19.8 11.0 18.8 10.9 8.5 5.0 8.5 4.6 2.3 2.3 3.5 3.5 5.1 4.0 5.0 4,1 1,6 5.0 1.6 5.1 Gross national product Final purchases Personal consumption expenditure Gross private domestic investment Residential structures Business fixed investment Fed. govt. purchases of goods & services Defense Other S. and L. govt. purchases goods & services Federal government (N.I.A. basis) Receipts Expenditures GNP in constant dollars GNP deflator 5.9 7.4 6.7 7.1 6.8 7.1 TABLE A-2 SELECTED NATIONAL INCOME AND PRODUCT ITEMS (Dollar figures are billions, seasonally adjusted annual rates) quarter I Former Est. II Rev. Est. Former Est. III Rev. Est. Former Est. IV Former Rev. Est. Est. Rev. Est. ----------------------- 1967-----Real GNP change, % per year Change in nonfarm bus. inventories, $ Personal saving, $ Ratio to DPI, % Government surplus or Deficit (N.I.A.1 Federal State & Local -0.9 -0.9 9.1 40.0 7.5 9.5 39.3 7.4 -12.0 -11.6 -2.1 -2,0 2,4 3.0 3.0 4.0 37.7 7.0 37.6 7.0 -13.2 -12.5 -2.8 -2.7 4.5 7.0 40.7 7.4 ------ 4.3 7.8 41.3 7.5 -13.4 -13.1 -1.3 -0.8 3.2 2.8 8.0 43.1 7.7 8.5 43.3 7.7 -12.3 -12.3 -1.0 -0.7 ----------------------- 1968-----------Real GNP change, % per year Change in nonfarm bus. inventories, $ 5.7 1.3 7,2 6.9 6.9 2.5 40.8 7.1 10.3 42.3 7.2 -8.4 -3.1 -9.2 -1.6 -9.5 -10.5 -1.3 -0.7 Personal saving, $ 39.9 Ratio to DPI, % Government surplus or Deficit (N.I.A.1 $ Federal State & local 5.8 10.3 44.5 7.6 3.9 4.1 7.5 33.2 5.6 8.1 36.5 -2.8 -0.7 -4.1 -0.4 6.1 3.2 2.7 10.7 9.3 38.0 39.6 6.5 6.3 -0.1 -0.8 -1.1 -1.9 ----------------------- 1969--------------------Real GNP change, % per year Change in nonfarm bus. inventories, $ Personal saving, $ Ratio to DPI, % Government surplus or Deficit (N.I.A.),$ Federal State & local 2.6 2.0 2.2 2.1 2.6 -0.4 -0.9 6.6 32.5 5.3 7.3 34.3 5.6 6.7 33.3 5.3 7.6 33.3 5,3 10.3 43.1 6.7 10,8 42.0 6.5 7.4 41.7 6.4 6.5 41.1 6.3 10,1 -1.8 9.5 -1.8 13.5 -2.1 13.4 -1.5 7.7 -0.3 8.3 -0.3 2.5 6.6 1.6 6.1 1.0 CONFIDENTIAL - FR GROSS NATIONAL PRODUCT AND RELATED ITEMS (Quarterly figures are seasonally adjusted. Expenditures and income figures are billions of dollars, with quarterly figures at annual rates.) 1967 1968 I II III Gross National Product Final purchases Private Excluding net exports 774.4 764.8 590.6 585.1 784.5 780.0 601.6 595.8 800.9 792.2 610.9 605.3 Personal consumption expenditures Durable goods Nondurable goods Services 480.7 69.8 213.1 197.8 489.6 73.6 214.2 201.8 Gross private domestic investment Residential construction Business fixed investment Change in business inventories Nonfarm 114.0 21.6 82.9 9.6 9.5 110.7 23.3 82.9 4.5 4.0 Net exports of goods and services 5.5 5.8 I II III IV 815.9 805.9 619.4 615.4 834.9 832.3 638.6 636.8 858.1 847.8 649.5 646.1 875.8 867.6 665.5 662.1 891.4 882.1 675.4 674.0 495.5 73.7 215.5 206,3 502.5 75.3 217.1 210.1 519.7 79.9 225.6 214.2 529.1 82.6 227.6 218.9 543.8 86.7 232.6 224.5 550.8 86.9 234.8 229.0 118.6 26.6 83.3 8.7 7.8 123.0 28.8 84.1 10.0 8.5 119.8 28.8 88.3 2.6 2.5 127.3 30.6 86.4 10.4 10.3 126.5 29.9 88.3 8.2 8.1 132.6 31.7 91.6 9.3 9.3 4.0 1.8 3.4 1.4 5.6 IV 3.4 Gov't. purchases of goods & services Federal Defense Other State & local 174.2 87.7 69.9 17.9 86.5 178.4 90.1 71.8 18.3 88.2 181.3 91.4 73.0 18.3 89.9 186.5 93.6 74.7 18.9 92.9 193.7 96.4 76.3 20.1 97.2 198.3 98.9 77.8 21.1 99.4 202.1 100.7 78.6 22.1 101.4 206.7 101.9 79.2 22.7 104.7 Gross national product in constant (1958) dollars GNP implicit deflator (1958 = 100) 666.6 116.2 671.6 116.8 678.9 118.0 683.6 119.4 693.5 120.4 705.4 121.7 712.6 122.9 717.5 124.3 614.2 412.3 533.4 39.3 622.1 417.4 541.3 37.6 7.0 634.7 426.4 550.7 41.3 7.5 646.3 436.2 559.9 43.3 7.7 664.0 447.9 574.9 40.8 7.1 680.9 458.9 588.4 44.5 7.6 697.6 6.1 712.5 481.4 606.0 39.6 6.5 78.8 83.3 86.7 88.6 88.4 91.3 165.3 174.5 170.0 180.5 -10.5 Personal income Wage and salary disbursements Disposable income Personal saving Saving rate (per cent) Corporate profits before tax Federal government receipts and expenditures (N.I.A. basis) Receipts Expenditures Surplus or deficit (-) 7.4 78.4 78.8 147.7 159.3 148.7 -11.6 -12.5 161.2 151.9 165.0 -13.1 156.5 168.8 -12.3 -9.2 471.0 595.6 36.5 180.1 184.2 -4.1 186.2 187.2 -1.1 High employment surplus or deficit (-) 80.2 3.4 76.7 3.8 80.3 3.5 76.9 3.9 81.1 3.5 77.6 3.9 81.7 3.5 78.2 3.9 81.8 3.5 78.3 3.7 82.3 3.5 78.7 3.6 82.4 3.6 78.8 3.6 82.6 3.5 79.1 3.4 Nonfarm payroll employment (millions) Manufacturing 65.4 19.6 65.6 19.4 65.9 19.4 66.5 19.5 67.1 19.6 67.6 19.7 68.1 19.8 68.8 19.9 Industrial production (1957-59=100) Capacity utilization, manufacturing (per cent) 157.2 156.0 157.2 159.7 162.4 164.6 165.8 167.6 87.1 85.0 84.3 84.8 85.0 85.1 84.2 84.2 1.12 1.21 1.41 1.47 1.44 1.44 1.53 1.63 7.16 8.11 7.57 7.44 8.19 8.44 9.01 8.82 Total labor force (millions) Armed forces Civilian labor force Unemployment rate (per cent) Housing starts, private (millions A.R.) Sales new domestic autos (millions, A.R.) July 17, CONFIDENTIAL - FR 1970 CHANGES IN GROSS NATIONAL PRODUCT AND RELATED ITEMS 1967 I II ----------------------- Gross National Product Inventory change Final purchases Private Excluding net exports Net Exports Government GNP in constant (1958) dollars Final purchases Private 3.7 -10.3 14.0 5.0 0.6 9.0 -1.5 8.0 1.9 5.0 9.8 7.3 16.4 4.2 12.2 9.3 9.5 -0.2 2.9 ------------------------ Final purchases Private Personal consumption expenditures Durable goods Nondurable goods Services 5.2 -11.7 7.6 8.9 Gross private domestic investment Residential construction Business fixed investment -38.7 -9.0 -6.2 Gov't. purchases of goods & services Federal Defense Other State & local 21.8 27.3 26.2 33.9 16.9 GNP in constant (1958) dollars Final purchases Private GNP implicit deflator* -0.9 4.9 1.5 2.8 7.4 21.8 2.1 8.1 -11.6 31.5 0.0 Disposable income Nonfarm payroll employment Manufacturing Industrial production Housing starts, private Sales new domestic autos * Based on unrounded data. 7.5 6.9 5.6 4.8 0.5 2.4 8.9 28.5 56.7 1.9 II III IV 19.0 -7.4 26.4 19.2 21.4 -2.2 7.2 23.2 7.8 15.5 10.9 9.3 1.6 4.6 9.9 16.7 12.5 11.9 4.8 2.7 17.7 -2.2 19.3 16.0 16.0 0.0 3.8 15.6 1.1 It,5 9.9 11.9 -2.0 4.6 7.2 9.3 9.5 Per Cent Per Year------------------------ 14.8 33.1 3.8 3.0 6.0 5.6 2.2 Personal income Wage and salary disbursements Federal government receipts and expenditures (N.I.A. basis) Receipts Expenditures 13.7 8.5 10.1 -1.6 5.2 In I Billions of Dollars----------------------- 15.0 1.3 8.4 6.3 6.2 Gross National Product Corporate profits before tax IV In 10.1 -5.1 15.2 11.0 10.7 0.3 4.2 4.4 1968 III 8.2 9.3 9.9 9.3 3.3 12.4 11.1 7.4 6.8 13.7 24.4 15.7 7.8 7.2 13.5 3.5 8.8 11.1 19.9 8.8 10.2 -10.4 25.0 -2.5 19.3 0.Q 25.0 -9.1 24.1 20.0 -8.6 8.8 14.9 5.8 9.9 9.4 3.5 6.9 2.8 2.0 4.2 4.1 5.3 6.9 4.1 2.7 2.2 1.5 4.4 5.1 0.9 3.8 8.0 8.1 8.6 6.9 7.3 9.2 6.7 11.0 10.2 9.8 8.5 10.7 9.8 10.5 8.8 10.7 9.4 4.9 7.0 -23.1 2.0 0.0 22.8 16.3 8.8 -0.9 13.1 1.9 21.7 2,7 4.8 8.6 9.4 12.1 9.2 22.5 13.5 11.4 13.8 23.8 8.2 13.5 6.5 3.1 2.0 1.2 -4.1 1.8 0.0 3.6 2.1 3.6 2.0 3.0 2.0 3.0 2.0 A.1 -5.3 87.7 -3.1 32.2 53.2 6.4 18.8 -6.8 6.8 -9.5 4.2 5.4 -0.6 12.0 -50.1 3.1 65.9 -26.9 2.9 26.2 27.1 4.3 25.9 -8.5 July 17, 1970 CONFIDENTIAL - FR CHANGES IN GROSS NATIONAL PRODUCT AND RELATED ITEMS 1969 I II 1970 III Inventory change Final purchases Private Excluding net exports Net Exports Government GNP in constant (1958) dollars Final purchases Private 1.8 16.1 0.5 15.7 14.3 14.3 0.0 1.4 18.9 3.4 15.3 11.1 9.8 1.3 4.2 9.1 -4.1 13.3 11.1 11.1 0.0 2,2 7.8 -5.6 13.4 10.1 9.2 0.9 3.3 4.7 7.1 7.6 3.9 3.3 4.9 4.8 1.5 2.1 -1.7 2.1 2.8 -5.4 -0.5 1.1 16.2 -1.9 18.1 16.3 16.4 -0.1 Gross National Product Final purchases Private 7.1 7.0 8.3 8.2 6.7 6.3 8.0 10.1 7.5 7.9 8.2 6.7 8.0 8.9 6.1 -4.9 6.7 9.7 Gross private domestic investment Residential construction Business fixed investment 10.3 16.4 17.9 9.7 10.9 7.5 Gov't. purchases of goods & services Federal Defense Other State & local 3.5 -3.9 -3.0 -5.3 10.7 2.7 -4.4 -3.6 -8.9 9.7 Durable goods Nondurable goods Services GNP in constant (1958) dollars Final purchases Private GNP implicit deflator* 2.6 4.0 5.4 4.6 Corporate profits before tax Federal government receipts and expenditures (N.I.A. basis) Receipts Expenditures Nonfarm payroll employment Manufacturing Industrial production Housing starts, private Sales new domestic autos * Based on unrounded data. 12.9 -34.2 16.4 7.2 5.8 6.3 8.7 -10.0 -7.7 4.3 7.1 -7.5 10.8 8.6 III IV 0.5 -0.7 2.6 7.4 12.1 5.1 7.8 -20.0 -17.1 0.0 -2.4 -10.6 -11.1 -8.7 4.4 8.0 10.8 9.8 14.6 5.4 2.2 1.8 3.5 4.9 Personal income Wage and salary disbursements Disposable income IIP/ In Per Cent Per Year---------------------- ------------------------ Personal consumption expenditures I In Billions of Dollars--------------------- ----------------------- Gross National Product IV -0.9 1.2 2.0 4.8 9.2 10.7 11.3 6.5 6.9 6.2 -3.0 -0.4 0.8 6.3 0.3 -0.4 1.8 4.1 7.4 1.7 -15.0 -6.2 -26.7 n.a. 23.6 1.1 10.7 3.0 -3.4 7.2 2.4 7.1 -12.1 3.7 n.a. 26.1 4.6 4.0 3.4 2.0 1.7 0.0 1.7 -2.0 1.7 -2.0 6.2 3.7 -20.4 5.6 -31.4 8.4 3.9 -22.7 16.9 -5.5 -20.2 -34.9 -2.8 -31.0 -38.1 -1.1 -8.0 CONFIDENTIAL - July 17, FR 1970 GROSS NATIONAL PRODUCT AND RELATED ITEMS Expenditures and income (Quarterly figures are seasonally adjusted. figures are billions of dollars, with quarterly figures at annual rates.) 1970 1969 IV I lip I II III Gross National Product Final purchases Private Excluding net exports 907.6 900.2 691.7 690.4 923.7 915.9 706.0 704.7 942.6 931.2 717.1 714.5 951.7 944.5 728.2 725.6 959.5 957.9 738.3 734.8 970.1 967.5 749.2 745.4 Personal consumption expenditures Durable goods Nondurable goods Services 561.8 89.1 239.2 233.5 573.3 90.6 244.0 238.7 582.1 89.5 248.1 244.5 592.6 90.8 252.0 249.8 603.1 89.1 258.8 255.2 614.2 91.8 262.1 260.2 Gross private domestic investment Residential construction Business fixed investment Change in business inventories Nonfarm 136.0 33.0 95.7 7.4 7.3 139.3 33.9 97.5 7.9 7.6 143.8 31.0 101.5 11.3 10.8 140.2 30.4 102.6 7.2 6.5 133.2 29.1 102.6 1.6 0.9 133.8 28.5 102.7 2.6 2.1 Net exports of goods and services 1.3 1.3 Gov't. purchases of goods & services Federal Defense Other State & local 208.5 100.9 78.6 22.4 107.5 209.9 99.8 77.9 21.9 Gross national product in constant (1958) dollars GNP implicit deflator (1958 = 100) Personal income Wage and salary disbursements Disposable income Personal saving Saving rate (per cent) Corporate profits before tax Federal government receipts and expenditures (N.I.A. basis) Receipts Expenditures Surplus or deficit (-) 2.6 2.6 3.5 3.8 216.3 102.1 78.8 23.3 114.2 219.6 102.3 79.3 23.0 117.4 218.3 110.1 214.1 102.5 79.8 22.7 111.6 722.1 125.7 726.1 127.2 730.9 129.0 729.2 130.5 723.8 132.6 724.3 133.9 725.8 491.6 612.0 34.3 5.6 741.1 758.1 516.4 640.6 42.0 6.5 770.5 525.3 650.6 41.1 6.3 782.3 531.9 665.3 44.8 6.7 801.5 539.8 684.0 502.9 623.0 33.3 5.3 93.0 93.4 89.9 197.2 187.7 9.5 202.5 189.1 13.4 200.8 192.5 8.3 88.5 202.0 195.9 6.1 82.6 99.6 77.1 22.5 118.7 52.1 7.6 n.a. 195.9 n.a. 197.7 210.6 -1.7 n.a. High employment surplus or deficit (-) Total labor force (millions) Armed forces Civilian labor force Unemployment rate (per cent) 83.6 3.5 80.1 3.4 83.9 3.5 80.4 3.5 84.6 3.5 81.0 3.6 85.0 3.5 81.5 3.6 85.8 3.3 82.4 4.1 85.7 3.2 82.5 4.8 Nonfarm payroll employment (millions) Manufacturing 69.6 20.1 70.2 20.2 70.5 20.2 70.8 20.1 71.1 20.0 70.9 19.6 Industrial production (1957-59=100) Capacity utilization, manufacturing (per cent) Housing starts, private (millions A. R.) Sales new domestic autos (millions, A. R.) 170.2 172.6 174.3 171.9 170.7 169.3 84.5 84.5 84.2 81.7 79.8 77.9 1.64 8.37 1.52 8.54 1.43 8.91 1.36 8.13 1.25 7.35 1.27 7.95 III IV July 17 , CONFIDENTIAL - FR 1970 GROSS NATIONAL PRODUCT AND RELATED ITEMS (Expenditures and income figures are billions of dollars.) 1962 1963 1964 1965 1966 1967 1968 1969 Gross National Product Final purchases Private Excluding net exports 560.3 554.3 437.2 432.1 590.5 584.6 462.1 456.2 632.4 626.6 497.9 489.4 684.9 675.3 538.3 531.4 749.9 735.1 578.3 573.0 793.9 785.7 605.6 600.4 865.0 857.4 657.2 654.7 931.4 922.9 710.7 708.8 Personal consumption expenditures Durable goods Nondurable goods Services 355.1 49.5 162.6 143.0 375.0 53.9 168.6 152.4 401.2 59.2 178.7 163.3 432.8 66.3 191.1 175.5 466.3 70.8 206.9 188.6 492.1 73.1 215.0 204.0 535.8 84.0 230.2 221.6 577.5 90.0 245.8 241.6 Gross private domestic investment Residential construction Business fixed investment Change in business inventories Nonfarm 83.0 25.3 51.7 6.0 5.3 87.1 27.0 54.3 5.9 5.1 94.0 27.1 61.1 5.8 6.4 108.1 27.2 71.3 9.6 8.6 121.4 25.0 81.6 14.8 15.0 116.6 25.1 83.3 8.2 7.5 126.5 30.3 88.7 7.6 7.5 139.8 32.0 99.3 8.5 8.0 5.1 5.9 8.5 6.9 5.3 5.2 2.5 1.9 Gov't. purchases of goods & services Federal Defense Other State & local 117.1 63.4 51.6 11.8 53.7 122.5 64.2 50.8 13.5 58.2 128.7 65.2 50.0 15.2 63.5 137.0 66.9 50.1 16.8 70.1 156.8 77.8 60.7 17.1 79.0 180.1 90.7 72.4 18.4 89.4 200.2 99.5 78.0 21.5 100.7 212.2 101.3 78.8 22.6 110.8 Gross national product in constant (1958) dollars GNP implicit deflator (1958=100) 529.8 105.8 551.0 107.2 581.1 108.8 617.8 110.9 658.1 113.9 675.2 117.6 707.2 122.3 727.1 128.1 Personal income Wage and salary disbursements Disposable income Personal saving Saving rate (per cent) 442.6 296.1 385.3 21.6 5.6 465.5 311.1 404.6 19.9 4.9 497.5 333.7 438.1 26.2 6.0 538.9 358.9 473.2 28.4 6.0 587.2 394.5 511.9 32.5 6.4 629.3 423.1 546.3 40.4 7.4 688.7 464.8 591.2 40.4 6.8 748.9 509.0 631.6 37.6 6.0 55.4 59.4 66.8 77.8 84.2 79.8 88.7 91.2 106.5 110.3 -3.8 114.5 113.9 0.6 115.0 118.1 -3.0 124.7 123.5 1.2 142.5 142.8 -0.2 151.2 163.6 -12.4 175.4 181.6 -6.2 200.6 191.3 9.3 Total labor force (millions) " Armed forces Civilian labor force " Unemployment rate (per cent) 73.4 2.8 70.6 5.5 74.6 2.7 71.8 5.7 75.8 2.7 73.1 5.2 77.2 2.7 74.5 4.5 78.9 3.1 75.8 3.8 80.8 3.4 77.3 3.8 82.3 3.5 78.7 3,6 84.2 3.5 80.7 3.5 Nonfarm payroll employment (millions) Manufacturing 55.6 16.9 56.7 17.0 58.3 17.3 60.8 18.1 64.0 19.2 65.9 19.4 67.9 19.8 70.3 20.2 Industrial production (1957-59=100) Capacity utilization, manufacturing (per cent) 118.3 124.3 132.3 143.4 156.3 158.1 165.5 172.8 82.1 83.3 85.7 88.5 90.5 85.3 84.b 83.7 1.46 1.61 1.53 1.47 1.17 1.29 1.5L 1.47 6.75 7.33 7.62 8.76 8.38 7.57 8.62 8 46 Net exports of goods & services Corporate profits before tax Federal government receipts and expenditures (N.I.A. basis) Receipts Expenditures Surplus or deficit (-) High employment surplus or deficit (-) Housing starts, private (millions A.R.) Sales new U.S.-made autos (millions, A.R.) CONFIDENTIAL - FR July 17, 1970 CHANGES IN GROSS NATIONAL PRODUCT AND RELATED ITEMS 1962 1963 1964 ----------------------Gross National Product Inventory change Final purchases Private Excluding net exports Net exports Government 40.2 4.0 30.2 36.2 26.7 27.2 -0.5 9.5 30.3 GNP in constant (1958) dollars Final purchases Private 32.6 28.6 21.6 21.2 21.4 19.3 -0.1 24.9 24.1 0.8 5.4 1965 In 41.9 -0.1 42.0 35.8 52.5 3.8 48.7 40.4 42.0 -1.6 6.2 8.3 30.1 30.0 28.4 36.7 33.6 30.1 In 1967 1968 1969 billons of dollars----------------------- 33.2 2.6 ------------------------ 1966 40.3 35.4 23.6 44.0 -6.6 50.6 27.3 27.4 -0.1 23.3 71.1 -0.6 71.7 51.6 54.3 -2.7 20.1 66.4 0.9 65.5 53.5 54.1 -0.6 12.0 17.1 23.3 9.6 32.0 32.8 24.7 19.9 19.6 20.1 per cent per year------------------------ Gross National Product Final purchases Private Personal consumption expenditures Durable goods Nondurable goods Services Gross private domestic investment Residential construction Business fixed investment 5.9 12.0 4.3 5.6 8.9 3.7 7.9 12.0 6.9 7.5 7.7 6.8 8.3 7.5 8.9 14.9 7.1 8.6 7.8 7.1 6.8 9.0 5.8 6.6 7.0 9.8 6.0 7.2 15.8 4.9 7.9 15.0 12.3 -4.0 8.5 10.5 11.9 10.0 6.7 5.0 0.4 12.5 0.4 16.7 -8.1 14.4 0.4 2.1 20.7 6,5 5.6 12.0 2.6 3.6 1.9 3.2 4.7 4.9 4.7 4.0 Gov't. purchases of goods & services Federal Defense Other State & local GNP in constant (1958) dollars Final purchases Private GNP implicit deflator Personal income Wage and salary disbursements Disposable income 10.1 7.2 12.5 16.5 8.2 -5.2 11.2 2.8 Federal government receipts and expenditures (N.I.A. basis) Receipts Expenditures 8.3 8.0 7.5 3.3 0.4 3.7 8.4 4.6 14 3 15.6 6.1 14.6 16.0 11.0 14.4 5.3 Nonfarm payroll employment Manufacturing 3.0 3.7 2.0 0.6 2.8 1.8 4.3 4.6 5.3 6.1 3.0 1.0 3.0 2.1 3.5 2.0 7.8 11.4 21.5 5.1 10.1 8.6 6.4 -5.0 3.9 8.4 -3.7 15.1 9.0 -20.9 -4.4 1.2 10.9 -9.7 4.7 16.7 14.0 4.4 -2.7 -1.9 Corporate profits before tax Industrial production Housing starts, private Sales new U.S.-made autos
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