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JANUARY 1979

FEDERAL RESERVE

BULLETIN
The Economy in 1978
A Proposal for Redefining the Monetary Aggregates




A copy of the FEDERAL RESERVE BULLETIN is sent to each member bank without charge; member banks
desiring additional copies may secure them at a special $10.00 annual rate. The regular subscription price
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$24.00 per annum or $2.50 per copy. Group subscriptions in the United States for 10 or more copies to
one address, $1.75 per copy per month, or $18.00 for 12 months.
The BULLETIN may be obtained from the Division of Support Services, Board of Governors of the Federal
Reserve System, Washington, D.C. 20551, and remittance should be made payable to the order of the Board
of Governors of the Federal Reserve System in a form collectible at par in U.S. currency. (Stamps and
coupons are not accepted.)




V O L U M E 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 B u m 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.




Table of Contents
1

THE ECONOMY

IN

Divestiture plans of bank holding companies to be filed by September 30, 1979.

1978

As the U.S. economic expansion continued into its fourth year, activity was uneven and growth more moderate while
inflation was still a problem.
13

REDEFINING

THE MONETAR

Y

Proposed board actions: Regulations for
consumer protection under the Electronic
Fund Transfer Act; rules to implement
new legislation tightening restraints on
lending by member banks to insiders; disclosure requirements of the annual percentage rate under truth in lending; and
establishment of an international banking
facility in New York City.

AGGREGATES

The board's staff has proposed a revision
of the current measures of the monetary
aggregates because of the heightened pace
of regulatory changes and financial developments in recent years.
43

INDUSTRIAL

Issuance of "Consumer
Credit Protection L a w s , "

PRODUCTION

to

Admission of one state bank to membership in the Federal Reserve System.

Output rose approximately 0.6 percent in
December.
45

Handbook

Publication
Survey,

of

1977

Consumer

Credit

ANNOUNCEMENTS

Preliminary figures for 1978 indicate gross
current earnings of the Federal Reserve
Banks to be $8,455 million.
Bank procedures for defaulted municipal
general obligation bonds.
Adoption of amendments to Regulation Y
concerning publication of the intention of
bank holding companies to engage in
nonbank activities and the procedures for
commencing nonbank activities abroad.
(See Law Department.)
Adoption of uniform guidelines for the
enforcement of the truth in lending law
and its implementing regulations by the
five federal regulators of financial institutions.
New officers and members of the Consumer Advisory Council.




51

RECORD
FEDERAL

OF POLICY
OPEN

ACTIONS

MARKET

OF THE
COMMITTEE

At the meeting on November 21, 1978,
the committee agreed to instruct the manager to seek a federal funds rate of around
9% percent early in the period before the
next regular meeting and subsequently to
maintain the rate within a narrow band of
9% to 10 percent. 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 9V£ percent, provided that the rate
of growth in M-l over that period did not
exceed 5 percent. It was understood that
the chairman might call upon the committee to consider the need for supplementary

63

instructions before the next scheduled
meeting if significant inconsistencies appeared to be developing among the committee's objectives.

A70

LAW

All

DEPARTMENT

Amendments to Regulations Q and Y,
various rules and bank holding company
and bank merger orders, and pending
cases.
A1

FINANCIAL

AND BUSINESS

GUIDE TO TABULAR
AND STATISTICAL

BOARD OF GOVERNORS

OPEN MARKET
ADVISORY

A73

PRESENTATION
RELEASES
AND STAFF

COMMITTEE AND

STAFF;

COUNCILS

FEDERAL RESERVE

BANKS,

BRANCHES,

BOARD

PUBLICATIONS

AND OFFICES
A74

FEDERAL RESERVE

A76

INDEX TO STATISTICAL

A78

MAP OF FEDERAL RESERVE

STATISTICS

A3 Domestic Financial Statistics
A46 Domestic Nonfinancial Statistics
A54 International Statistics




A69

TABLES

SYSTEM

The Economy in 1978
Moderate Expansion and Persistent Inflation

This article was prepared by Albert M. Teplin
of the National Income Section of the Division
of Research and Statistics.
The economic expansion continued into its
fourth year in 1978, albeit at a more moderate
pace. Employment gains were again large and
the unemployment rate edged down further
despite sizable increases in the labor force.
Inflation posed major problems, however, with
price increases accelerating in most areas and
the overall rate of price rise the highest since
1974.
The economy started 1978 on a hesitant note
when the effects of a prolonged coal strike
combined with the disruptions of unusually severe winter weather to halt economic growth
(chart 1), The vigorous bounceback of activity
that followed during the spring quarter was
indicative of considerable underlying strength in
aggregate demand. In the third quarter the pace
of output growth moderated from the first-half
average, although activity picked up in the final
quarter of the year.
Business capital outlays provided the foundation 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, leveled oft in real terms, as total housing starts
remained at a high level.




In part, the slowing of growth in 1978 was
also attributable to reduced stimulus from the
government sector. Federal government outlays
were again well below early budget estimates
and the deficit was reduced from a year earlier.
Spending by state and local governments continued to be moderate, reinforced by the effects
of Proposition 13 in California and by related
initiatives in other states. By the fourth quarter,
the large operating fiscal surpluses experienced
in this sector for several years had been virtually
eliminated.
The U.S. international trade deficit began to
narrow during the year because of a sharp rise
in merchandise exports after the first quarter.
This improvement resulted largely from an increase in economic activity abroad relative to
that in the United States. Nonetheless, the
foreign exchange value of the dollar depreciated
substantially throughout most of the year.
The decline in the value of the dollar was
but one development linked to the acceleration
of price increases in 1978. The pick-up in infla1. Growth in GNP

1974

1976

1978

Department of Commerce data, seasonally adjusted at compound annual rates. "Rear' is in terms of 1972 dollars.

2

Federal Reserve Bulletin • January 1979

2. Components of final sales

Quarter after trough
Based on Department of Commerce data, seasonally adjusted
at annual rates in constant (1972) dollars

tion was widespread, with food and homeownership prices in particular accelerating rapidly.
Moreover, cost pressures intensified, as there
were sizable gains in wages and little increase
in labor productivity over the year.
The persistence of high rates of inflation apparently led to a number of distortions in the
pattern of economic demands. Although growth
of personal consumption slowed, it continued
to account for an unusually large proportion of
total product. The relative strength of consumer
spending appears to have been associated, in
part, with purchases of durable goods in anticipation of further price increases—a phenomenon that could reduce future demands. Similarly, the record number of home sales in 1978
appeared to reflect the notion that homeownership remains one of the few effective hedges
against inflation. This buy-ahead phenomenon
has led to unprecedented household indebtedness as well as to a personal saving rate at
the lower end of the postwar range. In the
business investment area, accelerating inflation
continued to augment uncertainties about the
future course of the economy and undoubtedly
lessened the willingness of firms to commit
funds for major expansion programs. While thus
far growth in aggregate activity has been sustained, a further worsening of inflationary trends
could lead to the types of severe imbalances that
have halted earlier expansions.
In an effort to ease inflationary pressures and
to stabilize the foreign exchange value of the




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.
While the near-term impact of these policies
could dampen the expansion of the economy,
at year-end there was evidence of continued
momentum, as sales and production registered
sizable gains. Inventories remained lean relative
to sales and the pace of housing activity continued strong; problems in these two sectors have
frequently been associated with disruptions of
previous upswings. Even so, there were mixed
signs about the prospects for activity elsewhere.
In the business sector, data on anticipations
suggested a slowing of growth of capital outlays
over the course of this year, while at the same
time new orders implied further increases in
business fixed investment activity in the next
few quarters. In the household sector, sentiment
weakened and debt burdens remained exceptionally heavy. Nonetheless, a spurt in retail
sales during the fall and early winter suggested
that consumers remained reluctant to cut back
on spending. Thus, while there is- some reason
to expect economic growth to moderate further
over 1979, there is no concrete evidence of such
a slowdown yet.

INCOME

AND

CONSUMPTION

Real disposable personal income grew about 3
percent over 1978—more slowly than in the
previous three years of the expansion (chart 3),
A large nominal gain in private wage and salary
disbursements reflected the strong growth of
employment together with an acceleration in the
rate of hourly wage increases. However, larger
tax burdens cut into the gain of real disposable
income; increases in personal contributions for

The Economy

3. Income, consumption, and saving

Based on Department of Commerce data in constant (1972)
dollars. Percentage changes are calculated from Q4 to Q4.

social security went into effect in January and
the interaction of inflation and a progressive tax
system raised effective personal income tax
rates.
The slower growth in incomes was reflected
in a smaller gain in consumption expenditures.
Over the year, real consumer outlays rose 3%
percent compared with an average pace of 5VI
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
sharply, along with spending for most nondurable goods.
In the spring consumer purchases rebounded
markedly. Total automobile sales, which had
4. Auto sales
Millions of units

1974

'

'

1976

'

Data from Ward's "Automotive Reports.!"




'

1978

in 1978

3

held up fairly well in the first quarter, soared
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,
demand for furniture and other durable goods,
such as books, jewelry, and recreation equipment, picked up. In addition, increases in purchases of nondurable goods were quite large,
particularly in the fourth quarter.
Despite somewhat smaller growth in the constant-dollar value of consumption last year, its
proportion of gross national product held at the
5, Ratio of durable goods consumption to GNP
Percent

Quarter after trough
Based on Department of Commerce data in constant (1972)
dollars.

high level experienced since early 1975. At
similar phases in prior expansions this share
typically has fallen. In particular, household
spending for durable goods has hovered at
around 10 percent of G N F over the past three
years, while during other economic expansions
it has usually declined to about l l k 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
with persistently high inflation rates. Opinion
surveys, for instance, suggest that a subtantial

4

Federal Reserve Bulletin • January 1979

proportion of consumers have been buying durable goods in anticipation of price increases.
In addition, due to federal tax reforms in the
1970s and to the large increases in the wage
base for payroll taxes, a greater share of the
growing volume of after-tax income has been
directed to middle- and lower-income groups
who have thus had the opportunity to satisfy
some previously unmet demands for durable
goods.
BUSINESS

FIXED

INVESTMENT

Real business fixed investment rose 8% percent
over 1978. This was nearly the same pace as
in the two previous years and about twice as
fast as the expansion of aggregate activity. Although capital spending was hampered early in
the year by severe weather and the coal strike,
the rebound in the spring was sharp and real
growth was at an annual rate of 12 percent over
the first half. During this period the level of
such expenditures first exceeded the peak in
1973, much later than the typical cyclical performance. In contrast to the rapid growth early
in 1978, real business fixed investment advanced at an annual rate of only 4VI percent
during the second half.
Nonresidential construction activity became a
principal source of business investment growth
in 1978, after having been slow to recover
earlier in the expansion (chart 6). Over the year,
real spending for such structures increased about
13 percent as outlays for commercial and industrial buildings showed particularly impressive gains. On the other hand, investment in
producers' durable equipment grew about 6V2
6. Business fixed investment

1975

'

1976

'

1977

'

1978

Based on Department of Commerce data, seasonally adjusted
at annual rates in constant (1972) dollars.




percent in real terms during 1978 compared with
increases of more than 10 percent in each of
the previous two years. With machinery outlays
advancing at about the same relatively moderate
pace recorded in 1977, the slowing of gains in
the equipment area reflected a trailing oft of
business demands for motor vehicles.
Investment by manufacturers grew 13 percent
in nominal terms, about matching the gain recorded in 1977. Within this sector, increases
were largest among producers of durable goods,
particularly stone, clay, and glass, electrical
machinery, and aircraft. In the nondurable
goods industries, producers of rubber products
and food had relatively strong gains also. Materials producers, which include some manufacturers in both the durable and nondurable categories, continued to show only a small advance
in capital spending. Outside the manufacturing
sector, the largest rise was evident in the air
transportation industry. In addition, railroads,
communications, and electric utilities had
above-average increases for the year, although
spending by utilities slowed noticeably in the
second half.
Many of the underlying determinants of capital spending moved somewhat less favorably
than in the preceding year. Final sales and
profits grew more slowly than in 1977. Also,
financing costs were boosted by higher interest
rates and increases in dividend-price ratios of
equities. However, capacity utilization in the
manufacturing sector moved close to 86 percent
at the end of the year, well within the range
that typically signals a need for capacity expansion (chart 7). Nevertheless, in the materialsproducing sector, where supply constraints in
the past have led to sharp price increases, there
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 substantial upward momentum, suggesting a continuation of moderate growth in the near term.
Longer-term indicators, however, were less en-

The Economy

1 Capacity utilization in manufacturing
Percent

^

\\

/

f
1972

!

' 1974 '

' 1976

1978

Federal Reserve data, based on seasonally adjusted production indexes.

couraging. Surveys of business revealed plans
for 1979 that, if realized, would result in a
marked slowing of capital spending growth in
real terms. Capital appropriations in the manufacturing sector also suggested more moderate
increases for 1979 than in 1978. While the
recent past has been characterized by upward
revisions of business plans as the year progressed, the upgrading would have to be considerable for growth in capital spending in 1979
to match that of the 1976-78 period.

RESIDES

/mL

ComTRUCTION

Private housing starts were sustained at the high
annual rate of 2 million units during most of
1978 (chart 8). Nonetheless, total spending for
residential construction in real terms edged
down 1 percent over the year, compared with
an average annual rate of increase of 15 percent
during the previous three years. Inflation continued to be especially visible in housing mar-

8. Housing starts
Ratio

of units
2.0
1.0

.5

Department of Commerce data, seasonally adjusted at annual
rates.




in 1978

5

kets; average prices of homes sold—both new
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 construction loans and long-term mortgages rose
appreciably until by year-end they had reached
usury ceilings in a number of states and record
postwar highs in many other areas. Even so,
the variable-rate, six-month time accounts introduced in June buoyed deposit growth at key
mortgage lenders and helped maintain the high
rate of housing construction. Over all, growth
in net mortgage holdings of thrift institutions
is estimated to have fallen by about a tenth in
1978. Increases in net lending by commercial
banks, by federally related lenders, and via
passthrough securities helped to offset the decline in net acquisitions at thrift institutions.
Thus, residential mortgage debt formation in
1978 is estimated to have been close to the
record level of the preceding year.
Single-family starts—at 1.4 million units—
were virtually unchanged from 1977 and an
unusually large number for the fourth year of
an expansion. New-home sales remained at an
advanced level and were more than 50 percent
greater in 1978 than during the recent low in
1975. Demand for homeownership was particularly strong in the West and South.
Multifamily housing starts were up nearly a
tenth in. 1978.from their level a year earlier;
nevertheless, at about 600,000 units, they remained well below the levels of the early 1970s.
Last year's strength was supported by an increase in federally subsidized rental units under
the section 8 program of the Department of
Housing and Urban Development. Such units,
for low- and moderate-income families, accounted for about 25 percent of all multifamily
starts during the year, compared with 18 percent
in 1977.
The viability of private multifamily projects—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
strongest. Furthermore, prospects for the profit-

6

Federal Reserve Bulletin • January 1979

ability of rental units continue to be doubtful
because increases in rents have remained moderate relative to rising operating costs. On the
other hand, new multifamily units built for sale
have sold very rapidly in the past few years.
At year-end, housing activity was well maintained. Sales of new single-family homes,
which had fallen during the summer, turned up
again. Total starts remained close to an annual
rate of 2 million units, despite the general tightening of financial markets. However, continuing
economic expansion would likely put further
pressure on the balance between the sources and
uses of funds at mortgage lenders. Furthermore,
high interest rates make questionable the sustainability of housing demand in the year ahead,
especially in view of the already large debt
burdens of households.

BUSINESS

IS \ EN I OR i IN VESIMMN I

Investment in business inventories was characterized by continuing caution, in 1978, and as
a result, inventory-sales ratios ranged from low
to normal on an historical basis (chart 9). This
caution, which can be traced back to the severe
inventory cycle of 1974-75, appears to have
been responsible for the avoidance of the types
of overhangs that have preceded several prior
cyclical downturns.
Inventory accumulation was substantial in the
first quarter of 1978 following a moderate gain
in the final quarter of 1977. The increase was
noteworthy in view of the severe winter and the
coal strike, which cut production. In the second

9. Ratio of total inventories to sales
Ratio

quarter, the pace of accumulation accelerated
further as production rebounded and coal stocks
were built up again. In the second half of the
year the rate of inventory investment as a whole
leveled off, reflecting efforts by businesses to
keep stocks firmly under control.
The manufacturing sector built inventories at
a fast pace throughout most of the first half—
especially in the second quarter—-and into the
summer. During the first nine months of the
year, most of the inventory investment at manufacturers was in durable goods. Nonetheless,
since sales gains were in this area also, the
inventory-sales ratio for durable goods was
fairly stable. Moreover, the inventory-sales ratio
for all manufactured goods remained quite low
on an historical basis.
Wholesale and retail trade accumulation was
about evenly divided between durable and nondurable products during the first three quarters.
In the first quarter auto stocks at dealers reached
record highs. However, the extraordinary pace
of sales during the spring and summer resulted
in reduced inventories by fall, and auto stocks
appeared normal for the remainder of the year,.
On balance, wholesale and retail trade accumulation continued about in line with sales for most
of 1978.
In the fourth quarter, inventories appeared to
remain under close control. The significant
overhangs that developed at general-merchandise retail outlets in the fall were corrected at
least partially by the sharp rise in sales during
the holiday buying season and a slowing of
production of durable home goods. Toward the
close of the year, inventories were generally
lean to normal, suggesting little need for the
type of downward stock adjustment that can
disrupt growth in employment and production.

THE

1974

'

'

1976

'

'

1978

Based on Department of Commerce data in constant (1972)
dollars for alj manufacturing and trade establishments. Figure
for 1978 Q4 estimated by Federal Reserve.




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
receipts grew almost 15 percent, more than
matching the brisk rate of increase in 1976 and
1977 (chart 10). Personal tax receipts were

The Economy

10. Federal receipts, expenditures, and deficit
Billions of dollars
Expenditures

1

<

0

^ ^

Receipts
300
1

• ' L 1

11
1J U u u u
1

1
1974

i

^

^

1976

Deficit
i

^

t

u
100

1978

Department of Commerce NIA data. seasonall> adjusted at
annual rates,

swelled by the growth in nominal incomes,
which put earners into higher tax brackets, In
addition, a large increase in contributions for
social insurance reflected not only growing
payrolls but also previously legislated hikes in
the taxable wage base and in the tax rate. On
an accrual basis, taxes on corporate profits rose
in line with other receipts,
Real federal purchases—the component of
total outlays that is directly included in GNP—
declined slightly more than I percent over the
four quarters o f M 9 7 8 , following a gain of 6
percent in the previous year. The reduction was
most pronounced in the nondefense area, as net
loan repayments by farmers under the agricultural price support program of the Commodity
Credit Corporation more than offset increases
elsewhere in this category. (Commodity Credit
Corporation lending is treated as a federal purchase on an NIA basts since the value of farm
products in inventory, which are used as collateral for the loans, is transferred from the farm,
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
government work force—civilian and military—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 unemployment compensation between 1977 and
1978. On the other hand, federal grants to states




in 1978

12

and localities rose briskly over 1978 in response
to expanded local public works and public employment programs. However, the pace of such
federal--disbursements began to moderate late in
the year with the expiration of countercyclical
revenue sharing and the reduction in funding
for public service employment. Finally, interest
payments rose sharply over the year, following
a small gain in 1977.

STATE,

AND

LOC AL GO\

ERNMENIS

Growth in spending by state and local government units was moderate in 1978 (chart 11).
For the third consecutive year this sector's revenues exceeded expenditures, and the surplus,
after deducting the share tor social insurance
funds, amounted to $6 billion. Nevertheless, the
operational surplus was only half the amount
of the previous year, and by the fourth quarter
the sector's budget had moved close to balance.
This partly reflected the tendency for voter-induced tax relief to outweigh spending economies.
Fiscal conservatism at both state and the local
levels of government was one of the most
prominent political and economic issues of
1978, sparked in part by California's Proposition 13; which was passed in the early summer.
This measure put restrictions on property tax
collections in the current year and limited increases for future years; it also erected formidable barriers to other increases in taxes by local
11. State and local government activity
Percentage change
4

Billions of dollars
40

Department of Commerce data, seasonally adjusted at annual
rales. Employment growth is Department of Labor data, seasonally adjusted at annual rates. Percentage changes are calculated from Q4 to Q4.

8

Federal Reserve Bulletin • January 1979

governments or by the state legislature. The
popular appeal of this initiative provided a basis
for action in other areas of the country, and
spending limitations or tax reduction measures
appeared on the ballots of 19 other states and
numerous localities in November. Although
voters generally opted for less severe methods
of restraining expenditures, such actions imply
a protracted period of relative conservatism in
spending.
Purchases of goods and services by states and
localities increased V/i percent in real terms
over last year—about a percentage point below
the rise in 1977. Boosted by federal local public
works funding, construction outlays dramatically reversed their downward slide to increase
12 percent in real terms by year-end. The bulk
of the new construction outlays went into water
facility projects of all types and into housing
and urban redevelopment, educational buildings, and hospitals.
Employee compensation, which accounts for
more than half of state and local purchases,
increased 9 percent in current dollars over the
year. The gain in employment was only about
one-half of the average in other recent years—
about 200,000 jobs—despite the infusion of
federal funds under the Comprehensive Employment and Training Act; that program paid
directly for 580,000 jobs, or about 5 percent
of the total number of workers in the sector.
State and local government receipts rose to
$338 billion in the fourth quarter of 1978, a
10 percent increase over the previous year. The
rate of growth of own-source revenues (tax
receipts and nontax accruals) continually declined during the year, reflecting, in part, the
pressure on elected officials to hold down tax
rates, especially on property. Federal grants-inaid grew from $71 billion in 1977 to $79 billion
in 1978.

INTERNATIONAL

TRADE

The deficit in net exports of goods and services
on an NIA basis was $12 billion in 1978,
roughly the same as in the previous year (chart
12). The deficit narrowed during the year, however, and this provided additional support for




12. U.S. foreign transactions
Billions of dollars
Imports
^ ^

200

Exports
160

1120

inn 1n Ifi n n

ns"rpiuh n
1
1974

i
1976

„
y y y
n j u y i
Deficit | j H
i
i

20
+

0
20

1978

Department of Commerce NIA data, seasonally adjusted at
annual rates.

economic growth. By year-end exports were
about $7 billion less than imports, and conditions seemed favorable for further gains in 1979.
Contributing to the improvement of the external
position during the year was a pick-up in economic growth in the Group of Ten countries
and Switzerland over the four quarters of 1978
in contrast to more moderate expansion in the
United States.
The gradual improvement of the U.S. trade
balance did not prevent a substantial depreciation of the dollar with growing disorder in the
exchange markets. The trade-weighted average
value of the dollar fell about 20 percent from
September 1977 through the end of October
1978. Following the announcement of policy
measures on November 1, the dollar increased
in value, but at year-end it was still 17 percent
below its level in September 1977. While the
impact of this adjustment of exchange rates on
domestic inflation and activity has yet to run
its course, the efleets of the depreciation in
increasing import prices tended to raise the 1978
nominal trade deficit.
U.S. nonagricultural merchandise exports
expanded rapidly in real terms after the first
quarter of 1978. This increase followed essentially no growth in 1977 and while the expansion
was widespread, gains were particularly strong
for exports of machinery, industrial supplies,
and aircraft. Agricultural exports, which account for about a fifth of merchandise trade
shipments to other countries, grew rapidly in
1978, rising 20 percent in constant dollars. This

The Economy

strength coincided with unusually poor harvests
of wheat and soybeans in the Southern Hemisphere 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
of 1978 nonoil import prices were up 13 percent
from a year earlier, more than half of the rise
being due to the decline in the dollar's exchange
value.
Unlike other imports, the price of imported
petroleum was essentially unchanged during the
year, and increased production from Alaska and
stock drawdowns more than matched the growth
in domestic consumption. The result was a fall
in. oil imports amounting to about half'a million
barrels per day from levels in 1977. However,
the $2 billion decline in the oil import bill is
not likely to be matched in 11979- because the
Organization of Petroleum Exporting Countries
(OPEC) has announced a price increase of 1.4¥2
percent spread over the year. Furthermore,
Alaskan production has leveled off at about 1.2
million barrels per day and will not match the
needs of a further expansion in domestic demand.
Net receipts of military and service transactions with nonresidents showed another strong
increase last year, reaching a level of about $23
billion. The bulk of the gain came from rising
income generated by U.S. direct investments
abroad and from net receipts of fees and royalties from foreign affiliates.
THE LABOR.

MARKET

Over the year, total employment rose 4 percent,
nearly matching the exceptionally - strong advance in 1977 (chart 13). Despite the production disruptions of the first quarter, almost 214
million jobs were added to nonfarm payrolls by
June. While gains slowed over the summer,
rapid growth in employment resumed in the




in 1978

9

13, Later force, employment, and unemployment
Percent

Department of Labor data. Percentage changes are calculated
from Q4 to Q4.

fourth quarter, and by the end of the year, the
increase in nonfarm payroll jobs from the preceding December totaled 3.5 million.
Employment growth was particularly robust
in the goods-producing sector, although there
were substantial increases in other sectors as
well. Manufacturing jobs rose about 740,000
with strength concentrated in the durable goods
industries—especially machinery and transportation equipment. Accompanying the sharp
increases in nonresidential building activity and
the high level of housing starts throughout the
year was a rise in construction employment to
a record level of 4.4 million. Continued growth
in private service industries added 2 million jobs
in trade, finance, and services.
Hiring gains during the first half of 1978 were
sufficient to reduce the unemployment rate to
6.0 percent by the •second quarter, 3/4 of a
percentage point below the level of late 1977.
The. jobless rate showed little further improvement thereafter, however, and at year-end was
5.8 percent. Although reductions in unemployment were shared by all demographic groups,
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
quarters of 1978, despite another sizable rise
in the number of adult women in the labor force.
The -adult male labor force rose at about its
long-term. trend rate and the unemployment rate
for this group dropped 0.7 percentage point to
4.0 percent,, Teenage unemployment, however,
remained very high and was above 16 percent
in the fourth quarter. In addition, unemployment

10

Federal Reserve Bulletin • January 1979

among blacks and other minorities remained
relatively severe, despite a drop of almost 2
percentage points in their unemployment rate.
As opportunities for work increased during
1978, labor markets tightened noticeably. In
particular, unemployment rates for skilled and
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,

LABOR

COSTS




change

12
6

0

AND

Wages and fringe benefits grew more rapidly
in 1978 than in 1976 and 1977. Measured by
the hourly earnings index, wage rates in the
private nonfarm sector increased 8!4 percent
over the four quarters of last year compared with
about 7¥2 percent during each of the preceding
two years. The substantial boost in the minimum
wage in January contributed to the 9 percent
increase in the trade sector, which has the largest concentration of low-wage workers. In addition, the tightening of labor markets bolstered
wage demands in construction after three years
of moderate increases. Wage gains in the manufacturing industries amounted to 8V4 percent,
about the same pace as in 1977,
There were relatively few new collective bargaining settlements last year. Most important
were agreements negotiated in the coal and
railroad industries, which provided for increases
similar to those negotiated by major unions in
1977—more than 30 percent spread over the
three-year life of the contracts. Deferred increases and cost-of-living adjustments, however, were more significant factors in union pay
in 1978. Over all, effective wage rate changes
in collective bargaining agreements averaged 8
percent—about the same as in 1977, The tightening of labor markets, however, led to a narrowing of wage differentials between the union
and nonunion sectors. Nonunion wage gains
increased nearly 1V4 percentage points more
than in the 1976—77 period and about equaled
the rise in the union sector.
Hourly compensation,

14. Productivity and costs

which includes em-

Department of Labor data, seasonally adjusted. 1978 Q4
estimated by Federal Reserve.

ployer contributions for social insurance and the
costs of fringe benefits, rose 9 l h percent during
the year, about 1 l fi percentage points faster than
the previous year (chart 14). About a third of
this acceleration resulted directly from the increases in payroll taxes in the first quarter. In
addition, private fringe benefits continued to
increase faster than wages during 1978.
Productivity showed little improvement in
1978. Output per hour in the nonfarm business
sector was up slightly over the year, after having
risen only 1 ¥3 - percent in 1,977. Much of the
slowdown occurred outside the manufacturing
sector; output per hour in manufacturing increased at a rate of 3 percent during the year.
Normally, productivity growth slows as labor
markets tighten and capacity constraints are
approached; but the fall-off in productivity gains
after the cyclical rebound earlier in the expansion has been particularly sharp in the past two
years.
There seems to be no single reason for the
poor performance of U.S. productivity growth
in recent years, although a number of factors
appear to have played significant roles. The
increase in labor force participation rates for
women and youths has led to a more inexperienced work force on average. Added environmental and safety regulations have directed resources to uses traditionally not measured as
output and have slowed certain types of technological advances. Furthermore, capital accumu-

The Economy

Iation has been relatively deficient during this
economic expansion and has failed to keep pace
with the growth of the work force.
Lagging productivity performance, together
with the acceleration in hourly compensation,
resulted in intensified cost pressures over the
year. Unit labor costs rose 9 percent during
1978, up substantially from the increase of 6V3
percent in 1977. Pressures on labor costs are
likely to remain intense in 1979 because of the
tight labor market, the large number of major
collective bargaining agreements to be negotiated, and the previously legislated increases
in payroll taxes and the minimum wage.

PRICES

In addition to the sizable increases in unit labor
costs, special developments in the food, housing, and international sectors contributed to a
marked acceleration in the rate of inflation in
1978. Most broad measures of price change rose
about 2 percentage points more than in 1977
(chart 15). Consumer prices were up 9 percent
during 1978, as was the fixed-weight price index
for gross business product. Producer prices of
finished goods rose 9 percent also.
Developments in the farm and food sector
exerted a major influence on measures of inflation in 1978. Retail food prices rose 12 percent
over the year—the largest increase since

15. Prices
Percentage change

1974

1976

1978

Producer and consumer price indexes are Department ot Labor data,
seasonally adjusted. The gross domestic business product fixed-weight
index (1972 weights) is a Department of Commerce series, seasonally
adjusted. Annual percentage changes are calculated from Q4 to Q4.




in 1978

11

1974—and contributed about 3/4 of a percentage
point to the acceleration in consumer prices. The
increases at the retail level reflected a rise of
nearly; 20 percent in farm prices during 1978
following little change in the previous year.
Most of the rise in food prices came early in
the year; meat price increases were particularly
rapid as beef production continued to decline
from its cyclical peak in 1976. Price increases
for other food items, though smaller than those
for meats, were still quite large.
Trends in energy prices were mixed in 1978
and the rise at retail amounted to about 8 percent, somewhat above the increase in 1977.
Natural gas prices continued to surge upward;
over the past five years the annual rate of increase has averaged about 16 percent, reflecting
changes in regulatory policy and the impact of
increased prices for crude oil. Electricity rates
rose rapidly in the first half of 1978 due in part
to the higher costs associated with the coal
settlement. Gasoline prices were nearly stable
until midyear, when tight supplies led to a sharp
upturn. Further increases in gasoline prices are
due in 1979, mainly because of higher OPEC
crude oil prices.
Prices outside the food and energy areas rose
faster in 1978. Service prices excluding energy
accelerated to an annual rate of 9¥i percent from
8 percent last year. The homeownership component of the consumer price index was up 12lh
percent, more than 3 percentage points above
the previous year. This jump reflected strong
demand pressures on house prices and rising
mortgage interest rates. With low vacancy rates
and rising costs of fuel and other items, residential rents rose nearly l l h 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
larger price increases for automobiles and other
durable goods,
At the producer level, finished goods prices
of capital equipment showed considerably less

12

Federal Reserve Bulletin • January 1979

acceleration than those for consumer goods. But
crude materials prices, for both food and nonfood items, were up sharply, and toward the
end of the year, prices for construction materials
were also rising rapidly.
Because little relief is expected soon from the
pressures of labor costs, inflationary forces are
likely to remain intense in 1979—especially in
view of the sharp increases in the price of oil
and the continued rise in food prices, in light
of such prospects, fiscal restraint and regulatory
reform have been recognized as essential, conditions for facilitating a less inflationary expansion




of economic activity. In addition, the administration introduced a program of voluntary
wage-price guidelines designed to initiate a
gradual unwinding of inflationary pressures. The
general price standard directs firms to limit their
increases to 1 / 2 of a percentage point below
their average annual rise during the 1976-77
period. Wage increases are to be generally limited to about 7 percent a year. The program also
sets an alternative profit-margin standard, provides for public monitoring of certain price and
wage increases, and includes a legislative proposal for real-wage insurance.
•

13

A Proposal for Redefining
the Monetary Aggregates
This BULLETIN article presents proposals by the
staff of the Board of Governors for redefining
the monetary aggregates, They were formulated
by a board staff group chaired by Stephen H.
Axil rod, Staff Director for Monetary and Financial Policy. The proposals raise important
issues regarding
the payments
system,
the
evolving role of depositary institutions, and the
basis upon which the public chooses to hold
various financial assets. To aid in further consideration of these proposals,
comments
are
invited from the public. Please address comments to Office of the Staff Director for Monetary and Financial Policy, Board of Governors
of the Federal Reserve System»
Washington,
D.C. 20551.
Thomas D. Simpson, Senior Economist in the
Banking Section of the Division of Research and
Statistics, had principal responsibility for the
preparation of this article. Others making major
contributions to the formulation and analysis of
these proposals were Edward C. Ettin, John H.
Kalchbrenner,
David E. Lindse\\ Richard D.
Porter, Peter Tins ley, Darwin Beck, and William Barnett. Research assistance was provided
by Daniel Rudolph and Juan Perea.
Regulatory changes and financial innovations in
recent years have fundamentally altered the
character of the public's monetary assets. These
developments are responsible for growing similarities among certain kinds of deposits, and,
at the same time, for disappearing resemblances
among other kinds. Moreover, the distinctions
between the deposit liabilities of commercial
banks and those of thrift institutions have become blurred.
With the authorization of .negotiable order of
withdrawal (NOW) accounts and credit union
share drafts, some savings balances at thrift




institutions and commercial banks now provide
the same transactions services as demand deposits. In addition, preauthorization of bill payments and telephone transfer services have significantly increased the liquidity of savings deposits at both commercial banks and thrift institutions; and the automatic transfer from savings
to demand-accounts (ATS), recently authorized,
has a d d e d s u b s t a n t i a l l y to the t r a n s a c tions-related character of savings deposits at
commercial banks, 1
Other developments have reduced similarities
among various kinds of deposits, however.
While savings balances at both commercial
banks and thrift institutions have become more
liquid in recent years, time deposits have generally become less liquid. Penalties for early
withdrawal and the steady lengthening of maturities have reduced considerably the liquidity
of small-denomination time deposits. As a:consequence, the components of the M-2 and M-3
aggregates representing savings and small time
deposits have become more dissimilar over
time. Furthermore, a growing share of those
time deposits included in M-2—and in M-3—is
in large time deposits with denominations of
$100,000 or more. Chart 1 shows that large time
deposits' currently make up a much larger
proportion of M-2 than they did in the early
1970s. Moreover, such deposits have behaved
much like a managed liability, and their movements have tended to offset cyclical movements
in savings and small time deposits, also shown
1

Some thrift institutions—those with third-partypayment powers—are also permitted to oiler automatic
transfers. Moreover, the Federal Home Loan Bank
Board has recently proposed that federally chartered

savings and loan associations be authorized to offer a
new kind of third-party-payment account—a payment
order account—on which funds could be withdrawn by
nonnegotiable, nontransferable orders.

14

Federal Reserve Bulletin • January 1979

1. Principal components of M-2
Percent

Quarterly averages, seasonally adjusted.

in the chart. Over the cycle, large time deposits
included in M-2 have varied in much the same
way as large negotiable time deposits (negotiable certificates of deposit) at large banks, which
are excluded from the current M-2 and M - 3
measures.
Commercial banks in recent years have also
come to rely more heavily on some nondeposit
liabilities, particularly
security
repurchase
agreements (RPs). 2 From the standpoint of the
customer, RPs are a relatively safe and liquid
alternative to holding deposits with commercial
banks and other depositary institutions.
Because of these developments, the meaning
of measures of the monetary aggregates has
been changing, and a revision in existing definitions appears needed. The definitions proposed by the board stall in this article reflect
recent developments by grouping together similar kinds of deposits at all depositary institutions. While the proposals seek to bring the
monetary aggregates up to date, no one aggregate or group of aggregates can satisfy all purposes and, at times, it is necessary to deal with
their principal components, which would be
published separately. 3 Moreover, in view of the
2

A security repurchase agreement is an arrangement
whereby a bank " s e l l s " a security in its p o r t f o l i o —
usually a treasury or federal agency security—to a
c u s t o m e r and agrees to r e p u r c h a s e it at a specified price
at some future date.
3
In addition to the principal c o m p o n e n t s of the
proposed monetary aggregates, other pertinent deposit
categories, such as U . S . Treasury deposits, interbank
deposits, and deposits of foreign commercial banks and
official institutions, would be published. Estimates of
c o m m e r c i a l bank repurchase a g r e e m e n t s with the nonbank public would also be published.




pace of regulatory and financial innovation, further redefinitions might well be needed as the
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
Reserve's ability to control the various monetary
aggregates. Important consolidation issues arise
in the construction of measures of the public's
monetary assets and some of these are discussed
next. The last section contains a brief discussion
of the timeliness of the data and data requirements. The appendix describes in some detail
the procedures used in constructing the proposed
monetary aggregates and the basic data sources.

RECENT

DEVELOPMENTS

THE PUBLIC'S

MONETARY

AFFECTING
ASSETS

Since 1970 a large number of regulatory
changes and other financial developments' have
affected the nature of the public's monetary
assets. The most significant of these are listed
in table 1. With the authorization of NOW
accounts (line 2), credit union share drafts (line
6), and demand deposits at thrift institutions
(line 9), new accounts subject to withdrawal by
draft or check have appeared. NOW balances
at commercial banks had grown to about $2
billion by June 1978, while NOW accounts at
thrift institutions had grown to over $1 billion
(table 2, last column). Balances in share draft
accounts at credit unions (the third item in table
2), plus demand deposits at thrift institutions
(the fourth item) equaled almost
billion,
or about one-half of total NOW balances at that
time.
Preauthorized transfers from savings accounts
at commercial banks (table 1, line 1), government and business savings accounts (line 7),
telephone transfers (line 8), and, most recently,
automatic transfer services (ATS, line 1 1) have
substantially enhanced the liquidity and transactions character of commercial bank savings

Redefining

the Monetary

15

Aggregates

1. Selected developments affecting the nature of the monetary aggregates

Date

Development
1...

Preauthorized transfers *

2. N O W a c c o u n t s l b
3. 2'/ 2 vear, 4 vear, 6 vear, and 8 vear time
deposits* 1

9/70.
9/75
6/72,
1/74,
11/78
1/70,
12/74,,

4/75,

Savings halances at S & L s and c o m m e r c i a l

banks

M-2. M-3

9/72,
2/76,

S a v i n g s b a l a n c e s at M S B s , S & L s , and c o m m e r c i a l
banks

M - 2 , M-3'

7/73
6/78

T i m e deposits at
banks

commercial

M-2, M-3

S&Ls,

M-2, M-3

Time deposits
MSBs

4 . Substantial p e n a l t y o n early w i t h d r a w a l of time
7/73
deposits
5. Point-of-sale terminals ( P O S ) permitting r e m o t e
1/74
w i t h d r a w a l s of d e p o s i t s f r o m savings
10/74, 3 / 7 8
6 . Credit union share d r a f t s '
7 . Savings a c c o u n1t s f i o m d o m e s t i c g o v e r n m e n t s
1 1/74, 1 1 / 7 5
and b u s i n e s s e s
4/75
8 . Telephone- transfers1
5/76
9 . D e m a n d d e p o s i t s at thrills '
6/78
10. 6 - m o n t h monev market certificates

1 1.A u t o m a t i c t r a n s f e r services ( A T S ) .
12. P a y m e n t order a c c o u n t ( P O A )

Monetary aggregate
containing
deposit liability

D e p o s i t liability'

MSBs,

S&Ls,

at c o m m e r c i a l

and

banks,

and

M-3
M-3

S a v i n g s balances at S & L s
R e g u l a r share a c c o u n t s at f e d e r a l credit' unions

S a v i n g s b a l a n c e s at c o m m e r c i a l b a n k s
S a v i n g s balances at c o m m e r c i a l b a n k s K
Deposits of M S B s and S & L s
Time deposits at S & L s , M S B s , and c o m m e r c i a l
banks
S a v i n g s balances at c o m m e r c i a l b a n k s and thrifts
111/78
having transactions balances
P r o p o s e d 11/78 S a v i n g s balances- at 'S-&Ls"

M-2, M-3
M-2, M-3
M-3
M-2, M-3
M-2, M-3 •
M-3

• S a v i n g s and loans were permitted to m a k e p r e a u t h o r i / e d n o n n e g o liable t r a n s f e r s f r o m s a v i n g s a c c o u n t s f o r h o u s e h o l d - r e l a t e d e x p e n d i t u r e s
in S e p t e m b e r 1970 and third-party n o n n e g o t t a b l e t r a n s f e r s f r o m s a v i n g s
in April 1975, C o m m e r c i a l h a n k s were authorized to m a k e preauthorized
third partv n o n n e g o t i a b l e transfers f r o m savings in S e p t e m b e r 1975.
1,1
State-chartered mutual savings b a n k s began tillering N O W s in
'Massachusetts in June--1972.and in N e w H a m p s h i r e in S e p t e m b e r 1972
In J a n u a r y 1974. d e p o s i t a r y Institutions 'in M a s s a c h u s e t t s .and N e w
H a m p s h i r e w e r e authorized t o ' o f f e r N O W s , In-. March. 1976, N O W s
were authorized at depositarv institutions in C o n n e c t i c u t . M a i n e , R h o d e
Island, and V e r m o n t ; in N o v e m b e r 1978, N O W s were a u t h o r i z e d in
N e w York State.
*" N O W s at c o m m e r c i a l b a n k s appear in M - 2 (and M - 3 ) , while NO'W's
a thrift institutions a p p e a r ' in M - 3 .
sl
The increase in interest rate ceilings on the t w o - a n d - o n e - h a l t >ear
deposit w a s a p p r o v e d in J a n u a r y 1970. the increase o n t h e f o u r - y e a r

time deposit was a p p r o v e d in J u l ) 1973, the increase on the six-year
deposit in D e c e m b e r 1974, and the increase on the e i g h t - y e a r time
deposit in J u n e '1978.
'' T e m p o r a r y e x p e r i m e n t a l share d r a f t p r o g r a m s were first a p p r o v e d
tor tederal credit unions in O c t o b e r 1974, final regulations for p e r m a n e n t
p r o g r a m s b e c a m e e f f e c t i v e In 'March 1.9*78,
f
S a v i n g s a c c o u n t s f o r d o m e s t i c g o v e r n m e n t units w e r e p e r m i t t e d
in N o v e m b e r 1 9 7 4 , and f o r b u s i n e s s e s ( u p to $ 1 5 0 , 0 0 0 per a c c o u n t
per eiMtonner) In N o v e m b e r 1975.
K
Telephone transfers f r o m savings b a l a n c e s at thrift institutions have
b e e n a l l o w e d since the 1960s
1
S t a t e - c h a r t e r e d m u t u a l s a v i n g s b a n k s and s a v i n g s and l o a n s in N e w
York State w e r e a u t h o r i z e d to otter d e m a n d d e p o s i t s in M a y 1976.
Prior to this t i m e , these institutions were permitted to otter p a y m e n t
orders of w i t h d r a w a l ( P O W ) deposits In addition, thrift institutions
in s o m e - o t h e r s t a t e s - h a v e b e e n permitted to otter n o n - i n t e r e s t - e a r n i n g
transactions b a l a n c e s to h o u s e h o l d s .

balances. Telephone transfers and ATS permit
savings balances to be shifted readily into demand accounts, while preauthorized transfers
permit direct payments from customers" savings.
The authorization of savings accounts for businesses and domestic governments gives these
depositors a highly liquid interest-earning alternative to holding funds in demand accounts.
Funds in domestic government and business
savings accounts (shown in table 2) grew

sharply just after being introduced but more
recently have leveled off (business accounts) or
declined (government accounts) in response to
increases in market rates of interest. In late
1978; such balances amounted to about $15
billion,
Evidence on debits to savings accounts,
available since July 1977, indicates that activity
in these accounts has increased recently. As
shown below, turnover rates, defined as the

2. Selected deposit balances at commercial banks and thrift institutions
Millions of dollars, not seasonally adjusted
T y p e of d e p o s i t b a l a n c e
N O W accounts
At commercial banks
A t thrift institutions
Share draft b a l a n c e s at
c redit unions ,, „ . . , , , , , , , , , . . . . . . . . . . . . . . . . , . ,
D e m a n d d e p o s i t s at
thrift institutions
,/,
,
S a v i n g s at c o m m e r c i a l b a n k s • .
By d o m e s t i c g o v e r n m e n t s
By b u s i n e s s e s
......,...,',..,....
Small d e n o m i n a t i o n time d e p o s i t s
with maturities over four years
At c o m m e r c i a l b a n k s *
,
At thrift i n s t i t u t i o n s b
'
.....
m
b

June
1974

13
178

June
1975
211
36 9

804
61 1

June
1978

1.501
875

2,080
1,181
576

61

234

314

594

864

336

3,440
6,013

6,282
10.123

4,878
10.757

35,956
82,100

49,890
117,500

66,151
158,400

74.396
196,800

M e a s u r e d a s of J u l y ' o f e a c h y e a r . '
1 stimated as ot March of each vear lor savings and loans and April of each veur for mutual savings b a n k s




June
1977

166

3

21,027
40,600

June
1976

16

Federal Reserve Bulletin • January 1979

annual dollar volume of debits divided by
average balances, have risen since the summer
of 1977. (These data do not include NOW
accounts,) Turnover rates for business savings
Debits to savings deposits
(billions of dollars
at annual rates)
Month
1977
July
October . . .
December
1978
March . ,
July
October , , ,

:ent
All depositary institutions
Percent of interest-earning
component of M-3

Savings deposit turnover
(annual rates)

Business

Other

Business

Other

40.8
41.9
49.11

307.8
3)3.2
304.9

4.0
4.0
4.6

15
1.5
1.5

48.3
55.6
67.2

333.5
376.5
394.2

4.6
5.1
5.8

1.6
1.8
1.9

accounts advanced 45 percent from July 1977
to October 1978, while turnover rates for other
savings accounts—mainly those of individuals
and to a lesser degree domestic governments—rose about 25 percent. 4 To some extent,
this increase in turnover rates might reflect
higher market rates of interest, as some savings
customers likely shifted their investment
funds—relatively idle balances—to market instruments with higher yields. Nevertheless,
savings balances of both businesses and others
did expand between these dates, when turnover
rates were rising, suggesting that any outflows
of investment funds from savings were more
than offset by inflows of m o r e t r a n s a c tions-related funds.
Similarly, preauthorized
and
telephone
transfers have enabled customers of thrift institutions to use their savings more effectively for
transactions purposes. In addition, point-of-sale
terminals (POS, table 1, line 5) have gone a
step further by allowing these customers to
make withdrawals and deposits from savings by
using remote terminals placed at retailers. Most
recently, the Federal Home Loan Bank Board
has proposed that federally chartered savings
and loan associations be permitted to offer a new
''payment order account" (POA, line 12),
which could be used for making third-party
payments. 5
4
T h e s e turnover rates for savings d e p o s i t s , h o w e v e r ,
are considerably smaller than turnover rates for d e m a n d
deposits, w h i c h are about 100 per year for banks located
outside N e w York C i t y .
5
T h e ceiling rate on P O A accounts w o u l d , according
to the proposal, be 5 percent, the same as that for all
N O W accounts and A T S savings. T h e ceiling rate on
share draft accounts at credit unions is 7 percent.




2. Long-term, small-denomination time deposits

Commercial banks
Percent of interest-earning
component of M-2

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
mutual savings banks and savings and loans have been estimated; those at credit unions, believed to be very small, are
excluded.

In contrast to these developments, the increase in regulatory ceiling rates on four-, six-,
and eight-year time deposits (line 3), which
enabled depositary institutions to issue longerterm time deposits, has led to a significant
reduction in the liquidity of time deposits by
lengthening maturities at commercial banks,
mutuals, and savings and loans. As chart 2
shows, from the early 1970s to mid-1978, commercial bank time deposits with maturities of
four years or more advanced from less than 1
percent of total time and savings deposits included in M-2 to 15 percent; even more striking
has been the trend in longer-term time deposits
included in M-3, also shown in the chart, which
jumped from modest proportions in 1973 to an
estimated 25 percent of total time and savings
deposits included in this aggregate by the spring
of 1978. Dollar amounts of longer-term time
deposits at commercial banks and at savings and
loans and mutual savings banks are given in the
last two rows of table 2. In mid-1978, such
deposits accounted for about 45 percent of
small-denomination time balances at commercial banks and about 70 percent of small time
balances at savings and loans and mutual savings banks. The substantial penalty on early
withdrawals of time deposits imposed in July
1973 has further reduced the liquidity of time
deposits included in M-2 and M-3."

6
The depositor is required to f o r g o interest for 90
days and earns the p a s s b o o k rate for the remaining time
that the f u n d s have been placed with the institution.

Redefining

The introduction in June 1978 of the sixmonth variable-ceiling money market certificate
(table 1, line 10) has tended to offset the trend
toward longer average maturities of time deposits, This new deposit has attracted a sizable
volume of funds at both commercial;banks and
thrift institutions in just a few months, By late
December, seven months after the introduction
of money market certificates, such deposits at
commercial banks had expanded to 4Vz percent
of total time and savings deposits included in
M-2; at both commercial banks and thrift institutions these certificates had risen by late December to about 6% percent of total time, and
savings deposits included in M-3.
In addition to these developments, in the past
decade the public began to use cash management techniques more intensively. With the
application of such techniques as lock boxes,
wire transfers, information-retrieval systems,
and cash-concentration accounts, the public—
particularly businesses—has been able to make
transactions using relatively smaller amounts of
demand deposits. In extensive interviews with
board staff, cash managers and commercial
bankers indicated that their reliance on cash
management intensified around the mid-1970s.
Much of the funds "released" from demand
deposits was used to acquire highly liquid interest-earning investments, such as repurchase
agreements, commercial paper, and treasury
bills, 7

3. P r o p o s e d m o n e t a r y

aggregates

Proposed
aggregate
1. M-l

Components
Current M-l
Pi 1 s: NOW balances
Credit union share drafts




Amount»
June 1978
351.7
3,3*

.6
.9
,||i».

D e m a n d d e p o s i t s at t h r i f t s

ATS savings
LESS: Demand deposits of foreign
commercial banks and official

11.3

institutions

Total4"

2.

M-1+

4. M-3

345,0

Proposed M-1
PLUS: Savings balances at commercial banks*1
Total

221.6
566.6

Proposed M-l.
Pi i s: Savings balances at all depositary institutions*
Total

49.5.3
840.3

Proposed

345,(1

M-l

PLUS: All time and savings deposits
(including large time deposits)
at all d e p o s i t o r s

Total
7
In a recent econometric study of money .demand,
Tinslcy, Garrett, and Friar conclude that the bulk of
the shortfall in the public's demand for deposits during
this period was mirrored by acquisitions of _ transactions-related RPs, See P. A. Tinsley, B. Garrett, with
M , E, Friar s " The Measurement of Money W p a n d "
(Board, of Governors of the Federal. Reserve System,
Division of Research and Statistics, Special Studies
Section, November 1978; processed), An' alternative
interpretation of this period—one emphasizing the contribution of cash management services to reducing • the
variance of depositors' cash flow positions—can be
found in Richard D. Porter and Eileen Mauskopf, ."'Cash
Management and the Recent Shift in the Demand for
Demand D e p o s i t s " (Board of Governors of the Federal
Reserve System, Division of Research and Statistics.
Econometric and Computer Applications Section, October 1978; processed).

17

D o l l a r a m o u n t s in b i l l i o n s ot d o l l a r s , not s e a s o n a l ! } a d j u s t e d

AGGREGATES

The four monetary aggregates being proposed
by the board staff are presented in fable 3, The

Aggregates

new measures are designed to replace the current monetary aggregates, M-l through M-5,
shown In table 4. Proposed M-1, by including
new transactions accounts and by excluding
selected foreign deposits, is a more comprehensive measure of transactions balances held for
domestic expenditures than current M - l . The
next measure, M-1 + , adds to M-l all savings
balances at commercial banks, which have become more transactions-related in recent years.
Next, savings balances at thrift institutions,
which have also become more liquid in recent
years, are added to M-l + in deriving proposed
M-2. The fourth and broadest measure of the
public's monetary assets, proposed M-3, adds
to proposed M-2 time deposits at all depositary
institutions, and has been designed to include
all the deposit liabilities to the public of depositary institutions.

3. M~2

PROPOSED MONETARY

the Monetary

institutions'

.345,0

345,0

1,154,6
1,499,7

" Consists of NOW balances in New England stales In Novembei
1978, NOW accounts were authorized in New York State and by January
10, 1979, the stock of. MOW balances at depositary institutions in New
Voik is estimated to' have been $0.6 billion.
11
W o u l d a l s o i n c l u d e p a w n e n t o r d e r a c c o u n t s ( P O A ) at s a \ m g s a n d
l o a n s , it the c u r r e n t f e d e r a l H o m e L o a n B a n k H o a r d p r o p o s a l is

adopted. ATS savings were first offered on November 1, 1978, and
by January I©»
estimated ATS balances were $4 billion,
" To-tul d u e s itot e q u a l t h e s u m of t h e c o m p o n e n t s b e c a u s e ot

other

miscellaneous adjustments to.the total (see the appendix,).
1-1
Excludes NOW and. ATS savings balances at commercial banks.
® H x e l u d e s all N O W . A I S . P O A

(it i n t r o d u c e d ) . a n d c r e d i t

union

share draft balances.

Two questions were asked in designing the
proposed measures. First, do the assets included
serve as a transactions balance or a medium of
exchange? Are they, that is, generally accepted
in exchange for goods, services, and other

18

Federal Reserve Bulletin • January 1979

4, Current monetary aggregates
D o l l a r a m o u n t s in b i l l i o n s . not s e a s o n a l l y

adjusted

Current •

Amount,
Components

aggregate

i. M - I

June

Currency
PLUS; D e m a n d d e p o s i t s
cial b a n k s

at

commer258.8
351,7

Total
2. M - 2

3,

M-3

1978
92.9

M-1
PLUS; S a v i n g s

3 5 1 .. 7
balances

at

commer-

cial banks
Time deposits at commercial

223.8

banks
LESS I N e g o t i a b l e C D s at large b a n k s
Total

352,8
86 3
842.0

M-2
PLUS: S a v i n g s b a l a n c e s at thrift insti

842,0

tuitions

275.8

l i m e d e p o s i t s at thrift institu-

tions
Total
4, M-4

M-2
PLUS:

Negotiable CDs at large banks
Total

5, M - 5

M-3
PLUS: N e g o t i a b l e C D s at l a r g e b a n k s

Total

317,4
1,435.2
842.0
86.3
928.3
11,435.2
m,3
1,521.5

assets? Traditionally, currency and demand deposits at commercial banks—which make up
current M - 1 — h a v e been viewed as satisfying
this condition. More recently, as noted earlier,
other kinds of deposits, some of which are at
other kinds of institutions, have come to meet
this criterion. T h u s , in defining the proposed
M-1 measure, transactions balances of various
kinds have been aggregated across depositary
institutions.
Second, is the asset readily convertible into
a transactions balance? Does the public view
it, that is, as a highly liquid alternative to
transactions balances? Many believe that those
assets that the public considers close substitutes
for transactions balances should be included in
broader measures of the monetary aggregates.
The definition of the current M-2 embodies this
criterion by including savings and small time
deposits at commercial banks along with conventional transactions media. This second criterion also implies limits to aggregation. Assets
that are not viewed as close substitutes for media
of exchange would be excluded from the monetary aggregates. In applying this criterion to the
broader measures of the monetary aggregates,
similar kinds of deposits at all depositary institutions have been combined.
Other considerations have intluenced the design of the proposed monetary aggregates. One




is data availability. For example, it can be
argued that even though time deposits have
generally become more illiquid over time, there
are sizable amounts of short-term time deposits
and they should be included with savings deposits in a measure of the money supply. 8 The
problem with including time deposits is that data
on remaining maturities are generally not available, and data on the original maturities of time
deposits for some institutions, principally member banks, are available only for recent years, 9
The issue of data availability is discussed below
and in the appendix.
Another consideration in selecting measures
of the monetary aggregates is their empirical
relation to other economic variables, particularly the gross national product. Normally, a
measure of money would be more desirable the
closer its past relationship to G N P and other
economic variables. By fundamentally altering
the nature of the public's monetary assets,
however, recent financial developments. have
diminished the usefulness of statistical relationships based on longer-term experience as guides
to selecting aggregates. Indeed, in large part It
is because of these developments that new
measures of the monetary aggregates are being
proposed. Empirical evidence on this issue- is
presented below. Finally, the ability of-the Fed-eral Reserve to control an aggregate is another
important consideration in making a selection.
This issue, too, is discussed later.
The remainder of this section examines each
of the proposed monetary aggregates in some
detail.
8

While short-term time deposits tend-to be liquid

in the sense that the date of maturity is near, with current
interest penalties such deposits tend to become less
liquid as they approach maturity in the sense that the
effective >ield declines more the closer withdrawal Is
to maturity.
9
Timely data on the original maturity of member

bank time deposits for three maturity categories—'under
six months, "six months to four years, and over four
>ears—have been available weekly since late 1974."Less
timely breakdowns by maturity-—-estimated for all commercial banks—are available as of the end of each
quarter, beginning in 1968; however, maturity breakdowns have changed occasionally during this period In
connection with actions allecting regulatory ceilings on
different maturities of time deposits. Indirect data for
savings and loans and mutual savings banks are avail-

able semi-annually, beginning in 1973,

Redefining

Proposed

M-l

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
are held primarily as clearing balances for international transactions and international reserves, 11 Thus, compared with the present M - l ,
the proposed M-l is a more comprehensive
measure of balances of domestically related
transactions. 12 Proposed M-l satisfies the medium-of-exchange criterion, which calls for a
narrow measure of money to represent fundsavailable for immediate payment for goods,
services, and other assets. Such a measure can

the Monetary

Aggregates

19

4. Rates of growth of current and proposed M-l
Percent

Seasonally adjusted at annual rates,

3. Current and proposed M-l

be expected to be closely related to domestic
transactions.
As chart 3 reveals, proposed M-l is somewhat smaller than current M - l , since the
foreign-related demand deposits removed have
exceeded the new transactions balances added.
However, rates of growth (shown in chart 4)
are very similar for the two measures.
The public's demands for these measures of
money relative to GNP move inversely with
their velocities (chart 5). The velocities for
current and proposed M-l move in close parallel. While the demands for both current and
proposed M-I relative to GNP appear to have
decreased around 1975—at a time when market
rates of interest were generally d e c l i n i n g econometric evidence indicates a slightly less
pronounced decline for proposed M - l . 1 3
Although the more comprehensive measure
of transactions balances, proposed M - l , has
behaved much like present M - l , new developments are likely to cause the two to diverge.
With ATS accounts growing in popularity,
funds can be expected to shift from consumer
demand balances to ATS savings, thereby depressing current M-1 relative to total spending. 14

Quarterly averages, seasonally adjusted.

13
In simulations of m o n e y d e m a n d and r e d u c e d - f o r m
equations for both M - l m e a s u r e s o v e r the period from,
m i d - 1 9 7 4 to m i d - 1 9 7 8 , presented b e l o w , simulation
errors were marginally smaller for proposed M - l than
f o r current M-l*.
14
W h i l e shifts of f u n d s f r o m c o n s u m e r d e m a n d deposits to A T S s a v i n g s (and P O A s a v i n g s , if o f f e r e d )
will not aflect proposed M - l , shifts of f u n d s f r o m other
sources to A T S savings will cause this aggregate to rise
relative to total s p e n d i n g . A . b r e a k in the M - l series
can be expected regardless of whether A T S savings are
included. If fcbey are e x c l u d e d , M - l can be expected
to decline relative t o s p e n d i n g ; if they are included,
M - l .can be e x p e c t e d to increase.

10
If the Federal H o m e L o a n B a n k B o a r d . prqposal
to create a n e w p a y m e n t order a c c o u n t ( P O A ) is
a d o p t e d , these b a l a n c e s w o u l d be included in p r o p o s e d
M-1.
11
See Improving
the Monetary Aggregate.s:
Report
of the Advisory
Committee
on Monetary
Statistics
(Board of G o v e r n o r s of the Federal Reserve- S y s t e m ,
J u n e 1976), p . 4 . See also Helen T . P a r r , L a n c e V .
G i r t o n , H e n r y 5 , Terrell, and T h o m a s H , T u r n e r f
" F o r e i g n D e m a n d Deposits at C o m m e r c i a l Banks in the
United S t a t e s , " in Improving the Monetary
Aggregates:
Staff Papers (Board of G o v e r n o r s of the Federal R e s e r v e
S y s t e m , N o v e m b e r 1978). pp. 3 5 - 5 4 ,
12
S o m e transactions balance.®—-such as traveler*s
c h e c k s and m o n e y market mutual f u n d s — a r e e x c l u d e d
f r o m p r o p o s e d M - l , primarily b e c a u s e data are unavailable.




20

Federal Reserve Bulletin • January 1979

5. Velocities of current and proposed M-i
Velocity
t

'

-

^

^^z^iDurrent

j- ,

-•

4

i i i i ! 1 ! 11 i i i i i i t t i i i
1960
1970
1975
'78
1965
Seasonally adjusted.

In addition, should the Congress and the various
regulatory authorities continue to expand the
opportunities of commercial banks and thrift
institutions to offer new transactions accounts,
further conversions from consumer demand deposits will reinforce the importance of broadening the coverage of M - l .
Since NOW accounts, ATS savings accounts,
and share draft accounts at credit unions can
serve as both transactions balances and more
permanent interest-earning savings balances,
consumers are likely to hold larger amounts of
funds in these kinds of accounts than they would
otherwise have held in demand deposits, and
growth in proposed M-l relative to GNP may
be more rapid than historical growth of current
M - l . Also, since the interest-earning savings
component of these new accounts is likely to
be sensitive to spreads between market rates of
interest and regulatory ceilings, proposed M-l
may be more sensitive to changes in market
interest rates than current M - l . 1 5

M-1

+

The second proposed monetary aggregate shown
in table 3 (line 2) is M-1 + , which consists of
proposed M-l plus savings balances at commercial banks. 1 6 As noted earlier, developments
15
Econometric evidence indicates that the d e m a n d
for interest-earning savings balances is m o r e responsive
to c h a n g e s in both income and interest rates than is
the d e m a n d for d e m a n d deposits, and thus the d e m a n d
for proposed M - l , by including savings-related f u n d s ,
might be more income elastic and interest elastic than
the d e m a n d for current M - l .
16
The M - 1 + m e a s u r e described in this section
differs f r o m the one currently published basically by
excluding d e m a n d deposits of foreign c o m m e r c i a l banks
and official institutions.




in recent years have significantly enhanced the
liquidity of commercial bank savings accounts
and have increased the similarities between such
balances and demand deposits, Important
among these developments have been the authorization of business and domestic government savings and preauthorized and telephone
transfers, in addition to ATS and NOW accounts
for individuals. The aggregation of savings at
commercial banks and M-l into a new measure
of money was a possibility suggested for consideration by the Advisory Committee on Monetary Statistics. 17 Moreover, some empirical
evidence, based on the period before ATS,
suggests that savings balances at commercial
banks have had a higher degree of liquidity, or
" m o n e y n e s s , " than those at other institutions. 18
Depending on the direction of developments,
the proposed M - 1 + aggregate may serve
principally as a transitional measure. The importance of M - 1 + as a narrower monetary aggregate is tied very closely to the emerging role
of automatic transfers. During the transition,
when conversions to ATS savings are occurring,
the relationships between M-1 + on the one hand
and GNP and interest rates on the other should
resemble the historical pattern more than can
17

improving

the Monetary

Aggregates:

Report,

p.

11.
18
William A . Barnett, ""'A Fully Nested S y s t e m of
Monetary Q u a n t i t y and Dual - User Cost Price A g g r e g a t e s / 9 Board of G o v e r n o r s of the Federal R e s e r v e
S y s t e m , Division of Research and Statistics, E c o n o m e tric and C o m p u t e r Applications Section, N o v e m b e r
1978; processed). In this p a p e r , the author constructs
an ideal index under aggregation-—which might be interpreted as a m e a s u r e of "moneyness**—-based on
recent advances in the theory of index n u m b e r s and on
newly developed e c o n o m e t r i c m e t h o d s . T h e e v i d e n c e
suggests that a. d o l l a r ' s w o r t h of savings balances at
commercial banks m a k e s a larger contribution to the
" l i q u i d i t y " of c o n s u m e r s ' monetary assets than a dollar's worth of savings balances at thrift institutions,
perhaps because of the c o n v e n i e n c e of having savings
balances at the same location where one conducts other
business. Nevertheless, the author also finds a very high
degree of substitutability between savings deposits at
c o m m e r c i a l b a n k s and savings at thrift institutions.
W h e n similar m e t h o d s are applied to the m e a s u r e m e n t
of substitutability between savings deposits and transactions balances, it is discovered that savings deposits
and transactions balances are not viewed b> the public
as being as substitutable tor each other as savings
deposits at c o m m e r c i a l b a n k s and savings deposits at
thrift institutions. See also W . E. Diewert, " E x a c t and
Superlative Index N u m b e r s , " Journal of
Econometrics,
vol. 4 (May 1976), pp. 1 1 5 - 4 5 .

Redefining

be expected for either current or proposed M - L
Although conversions from consumer demand
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
Since savings balances are more sensitive
than demand deposits to interest rates—particularly to the difference between the rate paid by
commercial banks and short-term market
rates—growth in M - I + varies more over the
course of the interest rate cycle than does growth
in M - l . This difference can be seen in chart
6, which depicts the annualized rates of growth
of proposed M-l and M - 1 + in the upper panel
and the spread between the 90-day treasury bill
rate and the ceiling rate on commercial bank
passbooks in the lower panel. When market
yields were low relative to the ceiling rate—as
19
Shifts of f u n d s to A T S savings f r o m sources other
than d e m a n d deposits and ordinary savings deposits will
tend to disturb the relationships a m o n g M - I + , .GNP,
and interest rates, Available e v i d e n c e indicates, h o w e v e r , that shifts of f u n d s to A T S savings f r o m these
other sources h a v e been relatively small.
If P O A accounts are authorized for savings and loan
associations and if these accounts b e c o m e popular, the
u s e f u l n e s s of M - l f as a supplemental aggregate will
diminish. In this e v e n t , more attention could be given
to proposed M - 2 .

6. Rates of growth of proposed M-l and M-1 +
Percent

Yield spread




the Monetary

Aggregates

21

7. Velocities of proposed M-l and M 4 +
Velocity

Seasonally adjusted.

in the early 1960s, 1971-72, and 1976-77—
growth in M - 1 + was faster than growth in
proposed M - l . Conversely, when market rates
rose substantially above ceiling rates—as in
1966, 1969-70, and 1973—growth in M-1 +
was slow relative to that of proposed M - l .
Because movements in market interest rates
have a discernible influence on M-1 + , the velocity of that aggregate—shown in chart 7—
tends to vary directly with the interest rate cycle.
The velocity of M - 1 + has tended to increase
over time—along with the general level of interest rates—as has the velocity of proposed
M - l , also shown in the chart. I n ' t h e period
encompassing 1975 and 1976, however, the
velocities of M - 1 + and M-l were somewhat
disparate, with the M-l
velocity rising
sharply—at a time when market rates were
generally declining—while the M - 1 + velocity
was relatively steady. It appears that the
expanding use of cash management techniques
was largely responsible for the paring of transactions balances relative to GNP—particularly
by large businesses—and for the corresponding
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 E n z l e r , L e w i s J o h n s o n , and John P a u l u s ,
* * S o m e Problems of M o n e y D e m a n d , "
Brookings
Papers-on Economic Activity,
1:1976, pp. 261—80; Perry
D. Quick and J o h n Pawlus, " F i n a n c i a l Innovations and
the Transactions D e m a n d for M o n e y " (Board of G o v ernors of the Federal Reserve S y s t e m , Division of
Research and. Statistics, B a n k i n g Section, February
1977; p r o c e s s e d ) ; Porter and M a u s k o p f , " C a s h M a n a g e m e n t ; " and Tinsle> and others. " M e a s u r e m e n t of
Money Demand. * *

22

Federal Reserve Bulletin • January 1979

M-2

9. V e l o c i t i e s of p r o p o s e d M - 2 a n d 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
t i m e d e p o s i t s — a t c o m m e r c i a l b a n k s are
summed. 2 1 A comparison of tables 3 and 4
indicates that proposed M-2 and current M-2
are of comparable size.
Quarterly, seasonally adjusted.

8 . R a t e s of grow t h of p r o p o s e d M - 2 a n d M -1 +
Percent

k.
r-A

I i i i i i i i

Aa

1 +

12

/ \/ y \

A

i i i i1 ! 1

I I I )

Yield spread
Treasury bill rate less
/\
passbook ceiling^rate^/
\

Z\JL

I I I I i I I i i i i i i i i i i i

1960

1965

1970

1975

78

Seasonally adjusted.

The discussion in an. earlier section noted that
many developments that have increased the liquidity of savings deposits at commercial banks
have also enhanced the liquidity of savings
deposits at thrift institutions. Because of these
developments, the interest-earning savings balances of the public can now perform many of
the functions previously reserved for demand
deposits. Some empirical evidence suggests
that, while the public may consider savings at
commercial banks to be more liquid than savings at thrift institutions, a relatively hig h degree
of substitutability exists between the two kinds
of savings, and that savings at all depositary
21
Savings are distinct f r o m time deposits on liquidity
g r o u n d s . In practice, f u n d s in savings accounts are
' u s u a l l y available immediately while f u n d s in time deposit accounts are available with a delay or are subject
to a substantial early-withdrawal penalty.




institutions can be linearly combined in a monetary aggregate. 2 2 The combination of all savings balances with M-1 was also a possibility
suggested for consideration by the Advisory
Committee on Monetary Statistics. 2 3
As might be expected, the behavior of proposed 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 treasury bill rate and the ceiling rate on commercial
bank passbooks in the lower panel. Growth in
both measures tends to be sensitive to movements in the rate spread. The velocities of
proposed M-2 and M - 1 + — p r e s e n t e d in chart
9 — h a v e both trended upward over time and.
have had synchronous movements over the interest rate cycle.

M-3
Proposed M-3 consists of proposed M-2 along
with all time deposits of all depositary institutions, regardless of denomination, maturity, or
negotiability. Once again, similar deposits—in
this instance, time deposits—have been aggregated across depositary institutions. Table 3
22
Harnett, " A Fully 'Nested S y s t e m of M o n e t a r y
Q u a n t i t y , " concludes that, in such an aggregate, savings deposits at c o m m e r c i a l banks w o u l d .receive - a
higher weight than savings at thrift institutions. Indeed,
the weight attached to a d o l l a r ' s worth of s a v i n g s at
commercial banks would b e roughly twice as large as
the weight on a d o l l a r ' s worth of savings a t ' t h r i f t s , .
N e v e r t h e l e s s , such a w e i g h t e d series p r o d u c e s -growth
rates that h a \ e 'been very, similar to a scries t h a t s i m p l y
adds savings at c o m m e r c i a l banks to savings at thrift
institutions,
2:5
Improving
the Monetary
Aggregates:
Report,
p.

1 1.

Redefining

shows that proposed M-3 is considerably larger
than proposed M-2 and also larger than current
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 security repurchase agreements (RPs). 2 4 As noted
earlier, RP liabilities have become more important 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
an RP series using available information, and
it would be published separately; but the estimates are inferior to those for other components
of the monetary aggregates. 2 5 Once more complete data are collected, RPs could be added
to M-3 or perhaps to a narrower measure of
money, if that is suggested by subsequent research. 2 "
24
'.Depositary institutions also attract nondeposit
f u n d s f r o m other sources." However., m u c h of the f u n d s
f r o m sueh sources c o m e s trom other depositary institutions, domestic and foreign, and hence would be rem o v e d either by consolidation or b y p r o c e d u r e s that
exclude those liabilities due to foreign b a n k i n g offices.
For e x a m p l e , c o m m e r c i a l banks attract a sizable a m o u n t
of federal f u n d s f r o m sources other than c o m m e r c i a l
banks, but the bulk c o m e s f r o m other depositary instit u t i o n s — s a v i n g s and loans and mutual savings banks.
Also, c o m m e r c i a l banks attract nondeposit f u n d s in the
form of Eurodollars, which are obtained f r o m banking
offices abroad.
25
R P data are collected 'by the R e s e r v e B a n k s o n
a regular basis f r o m a sample of approximately 4 6 large
banks that are estimated currently to h a v e r o u g h l y 6 0
percent of all c o m m e r c i a l bank R P liabilities to the
nonbank public. H o w e v e r , unlike the data on c o m m e r cial bank deposits that appear in the monetary aggregates, universe call report data are not available for R P s ;
c o m m e r c i a l bank RPs with the nonbank public have not
appeared as a separate item on the call report and
indirect m e t h o d s , subject to considerable e r r o r , must
be used to estimate the universe. As a result, given
the size and variability of c o m m e r c i a l bank R P s , the
dollar magnitude of estimation errors in the s e r i e s ' f o r
all commercial banks'is'-probably very large. See 'also
T i n s l e y , Garrett, and Friar, " M e a s u r e m e n t of M o n e y
D e m a n d , " pp. A l - A 1 0 « 26
Another candidate for inclusion in proposed; M - 3
is Eurodollar deposits held by the U . S . n o n b a n k public.
Data on such holdings, h o w e v e r , are not available on
a timely basis and are incomplete.




the Monetary

Aggregates

23

10. Rates of growth of proposed M-2 and M-3
Percent

Yield spread
Treasury bill rate less
/V
passbook ceiling rate,^/ \

/

A ,—aa y y

\ .

$

Seasonally adjusted.

Chart 10 shows that rates of growth of proposed M-3 tend to be higher and generally
steadier than those of proposed M-2. This relative stability reflects largely the actions of depositary institutions, mainly commercial banks,
to offset over the course of the interest rate cycle
changes in inflows of savings and small time
deposits—subject to interest rate ceilings—
through the issuance of large time deposits that
are free of such ceilings. When inflows of small
time and savings deposits weaken because market rates rise considerably above regulatory
ceilings, these institutions tend to step up the
issuance of large time deposits; conversely,
when inflows of other deposits strengthen, reliance on these managed liabilities is reduced. As
a result, growth in this broader aggregate tends
to be less variable than growth in aggregates

11. Velocities of proposed M-2 and M-3
Velocity

Quarterly, seasonally adjusted.

24

Federal Reserve Bulletin • January 1979

that are strongly influenced by regulatory ceilings..27
The tendency for the growth of proposed M - 3
to be steadier than that of proposed M-2 is also
displayed in their respective velocities, presented in chart 11. In contrast to the velocities
of narrower measures of money, the velocity
of proposed M-3 has tended to decline over time
and has shown less cyclical variability than that
of proposed M-2,
EMPIRICAL

EVIDENCE

A criterion that .is frequently suggested, for selecting among alternative measures of monetary
aggregates is the degree to which each is linked
to the ultimate targets, such as GNP. In a variety
of theories of aggregate economic activity, the
stock of money is related to G N P and to other
economic variables, with changes in the stock
of money causing changes in GNP and some
other economic variables. Such theories, while
not providing much a priori guidance to precise
definitions of monetary aggregates, imply that
the more stable and predictable is the public's
demand for a monetary aggregate, the more
predictable will be the impact of changes in the
supply of this aggregate, other influences remaining the same, on GNP and these other
economic variables,
Econometric techniques can be used to correlate changes in alternative measures of the
money stock with changes in GNP. while removing the contribution of other influences, and
to estimate demand functions for alternative
measures of money. Normally, the definitions
selected that use this approach would be those
that had been most strongly correlated with GNP
or had displayed the most stable demand relationship. The presumption would be that the
aggregates selected according to these criteria
would continue to have the strongest and most

27
In this respect, proposed M-3 is similar to the
current M-2 and M-3 aggregates. As noted in the
introduction, movements in those large time deposits
currently included in M-2. and In M-3, tend to stabilize
M-2 growth by offsetting movements in savings and
small time deposits.




predictable relationship with GNP. However,
since recent financial innovations have fundamentally altered the characteristics of the public's monetary assets, the usefulness of such
econometric evidence is limited. In these cases,
an important econometric postulate—that the
public view the aggregate being demanded (in
this case money) as having homogeneous
properties over the sample period—may be violated. Moreover, given recent innovations and
regulatory changes, a monetary aggregate selected for its desirable econometric properties
based on past relationships may no longer be
closely linked, with the ultimate targets; while
another, having weaker econometric properties
in the past, may now be more tightly linked
with the ultimate targets. Indeed, a reexamination of the definitions of the monetary aggregates is warranted precisely because the established relationships among the aggregates and
other economic variables have been altered by
recent developments.
Another empirical basis for selecting measures of the monetary aggregates is their usefulness as indicators of the underlying state of the
economy. Information on the public's holdings
of currency and' deposit balances is generallyavailable on a more timely basis than information about the behavior of the economy. As a
consequence, incoming information on the
monetary aggregates can be used to make inferences regarding developments in the economy
before direct information is available. 28 For example, a slowing of monetary growth may be
interpreted to mean that total spending or GNP
is weakening. If the behavior of an indicator
is believed to be highly reliable, monetary policymakers may wish to adjust the posture of
policy in the light of this development—before
direct information on the state of the economy
is available—should they judge it •unhealthy for
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
from money to the ultimate target is presumed. In the
case of the indicator criterion, no causality is presumed.
Changes in money may cause changes in economic
activity, or changes in economic activity may cause
changes in money, or both may be affected b> some
third factor.

Redefining

the economy. Again, changes in the character
of monetary assets may tend to undermine the
value of some indicators selected on the basis
of historical evidence.
In the remainder of this section, demand
properties of the various measures of money are
first examined. Next, reduced-form equations
relating G N P to alternative definitions of money
and selected other variables are presented. Finally, the usefulness of the various measures
as indicators of economic activity is discussed.

Properties

of Money

Demand

Properties of the demands for the proposed
monetary aggregates are shown in table 5 and
those of the current aggregates are shown in
table 6. 2 9 Each money demand equation relates
the public's demand for an aggregate, on a
quarterly basis, to GNP, a market rate of interest, the rate on commercial bank passbook savings, and, in the case of the broader aggregates,
a rate representing the yield on commercial bank
time deposits. 3 0 In each instance, the public is
assumed to adjust its actual money balances
partially to a desired level—based on G N P and
interest rates—and the coefficient of the lagged
dependent variable can be used for inferring the

29
More extensive e v i d e n c e on the properties of
m o n e y demand functions for current and proposed aggregates, over a variety of sample and postsample
periods, is discussed in Richard D . Porter, Eileen
M a u s k o p f , David E. Lindsey, and Richard Berner,
''Current and Proposed Monetary Aggregates: S o m e
Empirical I s s u e s " (Board of Governors of the Federal
Reserve S y s t e m , Division of Research and Statistics,
Econometric and Computer Applications Section, January 1979; processed).
30
For all of the monetary aggregates except proposed
and current M - 3 , the m o n e y stock and G N P are divided
by the implicit G N P price deflator. A l s o , the lagged
dependent variable in each case is divided by current,
and not lagged, prices, in order to permit the equation
to pick up potential lagged responses in the public's
demands for m o n e y to changes in the price level. All
of the variables in these equations are entered in logarithmic form and thus coefficient estimates are shortrun elasticities. In the case of both the proposed and
the current M - 3 measures, the m o n e y variable and G N P
are divided by current wealth, as is the lagged dependent
variable in these equations. In all cases, the CochraneOrcutt adjustment for serial correlation has been used.




the Monetary

Aggregates

25

speed of adjustment. 3 1 For each monetary aggregate, two demand equations are reported.
Both are estimated using a sample period beginning in late 1960, but the first ends in mid1978 while the second ends in mid-1974; as
noted earlier, the pace of financial developments
in recent years has been particularly rapid, and
many believe that historical statistical relationships have changed since 1974, particularly the
public's demand for demand deposits. In all but
the M-3 equations, coefficient estimates for the
independent variables are short-run or impact
elasticities; they indicate how the demand for
money responds in the current period, in percentage terms, to a 1 percent change in G N P
or interest rates. 32
Summary statistics for each aggregate are
presented in the last three columns of tables 5
and 6. The R2 statistic indicates the proportion
of the variation in the demand for the monetary
aggregate that is explained by GNP, interest
rates, and the lagged dependent variable; and
the standard error of estimate is a measure of
the amount by which money demand estimated
from the equation differs from the actual money
stock. For example, the standard error of estimate for proposed M - l over the longer sample
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
column provides an indication of how well the
money demand equation has predicted the rate
of growth of the money stock in the period from
mid-1974 to mid-1978 ; 33 the smaller the root
31
The coefficient of adjustment is equal to 1 minus
the coefficient of the lagged dependent variable. For
e x a m p l e , if the coefficient of the lagged dependent
variable has a value of 0 . 9 , the public r e m o v e s 10
percent of the discrepancy between its actual and its
desired m o n e y balances in any one quarter; thus, about
one-half of the adjustment to desired m o n e y balances
is completed in two years. Implied speeds of adjustment
for the monetary aggregates are all apparently very
slow.
32
Long-run elasticities are derived by multiplying
each coefficient by the reciprocal of 1 minus the coefficient of the lagged dependent variable.
33
Root mean-square errors are for dynamic simulations expressed in rates of growth; in other words,
simulated levels of the m o n e y stock are converted to
rates of growth and errors are computed on the basis
of implicit simulated m o n e y growth and actual growth.

26

Federal Reserve Bulletin • January 1979

5. Representative money demand equations for proposed monetary aggregates"
I n d e p e n d e n t variable

Treasury
bill
rate

5.1 a
5.1b

5.2b

M-2*
5.3a
5.3b

M-3{
5.4a
5.4b

Commercial
bank
time
deposit
rate 0

R2

Standard
error of
estimate
(annual
percentage
rate)

1.020
(34.842)
.733
(6.936)

.9902

1.80

.9934

1.66

Lagged
dependent
variable

Adjusted

-.791
(-2.439)
1.359
(1.614)

.042
(3.184)
.144
(3.632)

-.010
(-2.709)
(-2.382)

-.009
(-.696)
-.024
(-1.359)

.208
(.624)
-.138
(-.339)

.067
(3.378)
.072
(2.876)

-.021
(-3.956)
-.020
(-3.715)

.027
(1.398)
.032
(1.495)

-.009
(-.627)
-.019
(-1.045)

.912
(24.172)
.934
(19.991)

.9945

1.91

.9954

1.64

-.042
(-139)
-.446
(-1.342)

.046
(2.681)
.055
(2.723)

-.027
(-4.514) '
-.025
(-4.144)

.034
(1.540)
.042
(1.776)

-.012
(-.824)
-.031
(-1.599)

.957
(41.560)
.979
(39.100)

.9943

1.99

.9960

1.76

-.0009
(-.116)
.0006
(.068)

.0005
(.012)
-.054
(-1.225)

-.0007
(-3.049)
-.001
(-3.989)

.004
(3.412)
.004
(2.732)

-.0003
(-.463)
.0002
(.278)

.961
(20.171)
1.035
(19.913)

.9974

1.86

.9960

1.90

M-1+"
5.2a

Commercial
bank
passbook
saving
rate

S u m m a r y statistic

-.011

a

Root
mean-square
error of
annualized
growth
rate' 1
(annual
percentage
rate)

T h e n u m b e r s in p a r e n t h e s e s are f-statistics.
T h e a and b e q u a t i o n s differ in s a m p l e p e r i o d . T h e period for
e q u a t i o n 5 . 1 a , 5 . 2 a , and so o n , is 1 9 6 0 Q 4 to 1 9 7 8 Q 2 ; the period for
the b e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 4 Q 2 .
1
T h e time d e p o s i t rate used is the o n e for the time d e p o s i t maturity
h a v i n g the highest yield, after a d j u s t i n g for the p r e v a i l i n g term structure
of interest rates.
d
T h e root m e a n - s q u a r e error for d y n a m i c s i m u l a t i o n s over 1974Q3

to 1 9 7 8 Q 2 . S i m u l a t e d levels of the m o n e y stock are c o n v e r t e d to annual
rates of g r o w t h and errors are c o m p u t e d on the basis of implicit
simulated m o n e y g r o w t h and actual g r o w t h .
T h e d e p e n d e n t variable and G N P are divided by the G N P deflator.
T h e lagged d e p e n d e n t variable is divided by the G N P deflator in the
current p e r i o d . T h e specification of the e q u a t i o n is d o u b l e l o g a r i t h m i c .
f
T h e d e p e n d e n t variable, lagged d e p e n d e n t variable, and G N P
variable are divided by current n o m i n a l w e a l t h .

mean-square error for an aggregate, the better
is that aggregate's forecasting record during this
volatile period. 3 4
Equations 5 . 1 a , 5 . 1 b , 6. l a , and 6. l b suggest
that the demands for current and proposed M-1
are similar. The impact of G N P and other explanatory variables is nearly the same for each
narrow measure of money. Moreover, the coefficients of G N P in equations 5.1a and 6.1a show
a marked decline, respectively, f r o m 5.1b and
6.1b in the impact of G N P on each aggregate,
while the coefficient of the lagged dependent
variable for both M - l measures rose substantially over the longer sample period. This contrast appears to reflect a decrease in the public's
demand for demand deposits—which make up
a considerable share of each M - l aggregate—
and is believed to have been an outgrowth of
the more intensive use of cash management
around 1974, particularly by businesses. Al-

though the prediction performance of each
measure of transactions balances has been poor
in the post-1974 period, proposed M - l has a
slightly better record than current M - l .
The second monetary aggregate presented in
table 5 is M - l - K As might be expected, the
demand for this aggregate tends to increase with
increases in the commercial bank passbook rate,
while it declines in response to increases in the
treasury bill rate and the yield on time deposits.
In contrast to the demand for both M - l measures, the demand for M - 1 + has not demonstrated a noticeable tendency to shift in the
period since mid-1974; coefficient estimates for
each explanatory variable, with the possible
exception of the time deposit rate, are very
similar for the two sample periods. Moreover,
the predictive power of the M-1 + demand
equation during this period, indicated by its root
mean-square error, was better than that of both
M - l measures.

34
The prediction performance of all the monetary
aggregates is relatively w e a k . H o w e v e r , the 1 9 7 4 - 7 8
period is believed to have seen substantial changes in
the characteristics of many of the deposit liabilities
appearing in these monetary aggregates.

The demand properties of the proposed M - 2
aggregate are similar to those of M-1 + . Coefficient estimates indicate that the sensitivity of
proposed M-2 to interest rates and G N P is nearly

l)




Redefining

the Monetary

27

Aggregates

6. Representative money demand equations for current monetary aggregates 11
S u m m a r y statistic

I n d e p e n d e n t variable

6.1a
6.1b

M-T
6.2a
6.2b

M-3{
6.3a
6.3b

Treasury
bill
rate

Commercial
bank
passbook
saving
rate

Commercial
bank
time
deposit
rate*

Adjusted

Standard
error of
estimate
(annual
percentage
rate)

1.022
(29.795)
.699
(6.549)

.9916

1.74

.9946

1.58

.9994

1.68

.9993

1.65

.9972

1.54

.9966

1.47

Lagged
dependent
variable

-.832
(-2.381)
1.530
(1.848)

.044
(3.151)
.163
(3.987)

-.009
(-2.347)
-.010
(-2.215)

-.015
(-1.089)
-.031
(-1.865)

-.405
(-1.991)
-.699
(-2.759)

.166
(2.629)
.190
(2.335)

-.025
(-4.944)
-.028
(-5.145)

-.004
(-.187)
.009
(.395)

.023
(1.605)
.014
(.790)

.856
(13.625)
.853
(11.126)

.004
(.643)
.002
(.340)

-.010
(-.307)
-.044
(-1.171)

-.0009
(-5.184)
-.001
(-5.521)

.003
(3.612)
.003
(2.232)

.0004
(.861)
.0009
(1.349)

.964
(21.270)
1.033
(19.829)

a

R2

Root
mean-square
error of
annualized
growth
rate' 1
(annual
percentage
rate)

2.35

T h e n u m b e r s in p a r e n t h e s e s are f-statistics.
h
T h e a and b e q u a t i o n s differ in s a m p l e p e r i o d s . T h e period for
the a e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 8 Q 2 ; the period for the b e q u a t i o n s
is 1 9 6 0 Q 4 to 1 9 7 4 Q 2 .
' T h e time d e p o s i t rate used is the o n e for the time deposit maturity
h a v i n g the highest y i e l d , after a d j u s t i n g for the prevailing market term
structure of interest rates.
(l
. T h e root m e a n - s q u a r e error for d y n a m i c s i m u l a t i o n s over 1 9 7 4 Q 3

to 1 9 7 8 Q 2 . S i m u l a t e d levels of the m o n e y stock are c o n v e r t e d to annual
rates of g r o w t h and errors are c o m p u t e d o n the basis of implicit
simulated m o n e y g r o w t h and actual g r o w t h .
11
T h e d e p e n d e n t variable and G N P are divided by the G N P deflator.
T h e lagged d e p e n d e n t variable is divided by the G N P deflator in the
current p e r i o d . T h e specification of the e q u a t i o n is d o u b l e l o g a r i t h m i c .
' T h e d e p e n d e n t v a r i a b l e , lagged d e p e n d e n t variable, and G N P
variable are divided by current n o m i n a l w e a l t h .

the same as that of M-1 -b. While the coefficients of the two equations for proposed M-2
shown in table 5 are very similar, other results
for the 1960s, on the one hand, and the 1970s,
on the other, suggest that proposed M - 2 has
become more transactions-related in the 1970s;
in particular, the demand for proposed M - 2
appears to have become more responsive to
G N P in the 1970s, and the speed of adjustment
of actual to desired proposed M-2 balances
appears to have increased. 3 5 The prediction performance of proposed M - 2 in the post-1974
period is not so good as that of M-1 + , and
proposed M - 2 has a larger forecast error than
current M - 2 (table 6).
The demand for proposed M - 3 is shown in
the last two equations of table 5. As might be
expected of any broad measure of m o n e y , the
demand for this aggregate is not so strongly
influenced by G N P as are the more narrow,
transactions-related measures. In relative terms,

the rate of interest and the wealth variables are
more important determinants of the public's
demand for this aggregate. The properties of the
public's demand for current M - 3 and proposed
M-3 are in many respects similar, as shown in
tables 5 and 6.

Reduced-form equations that relate the annualized percentage change in G N P , measured in
current dollars, to current and lagged annualized
percentage changes in monetary growth, current
and lagged values of a fiscal variable, and a
strike variable are presented in tables 7 through
10. 36 Tables 7 and 8 contain reduced-form
equations and corresponding lag coefficients
using the proposed monetary aggregates, and
tables 9 and 10 contain results for the current
measures. Reduced-form results are used by
some to infer the impact of money growth on

35
See Porter and others, "Current and Proposed
Monetary A g g r e g a t e s , " pp. 8, 1 7 - 1 8 . The e v i d e n c e
presented in this paper also suggests that the demand
for M - l — b o t h the current and the proposed m e a s u r e —
has b e c o m e more sensitive to the passbook savings rate,
implying that savings balances may have b e c o m e more
substitutable for transactions balances in the 1970s.

36
More detailed e v i d e n c e on the reduced-form equations for current and proposed aggregates over a variety
of sample and postsample periods is discussed in Porter
and others "Current and Proposed Monetary Aggregates."




Reduced-Form

Equations

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 variable a
S u m m a r y statistic

I n d e p e n d e n t variable

7.1a
7.1b
M-l +
7.2a
7.2b
M-2
7.3a
7.3b
M-3
7.4a
7.4b

money
coefficients

S u m of
fiscal
coefficients 1

Strike
variable d

Adjusted
R2

Standard
error of
estimate
(annual
percentage
rate)

2.197
(2.198)
2.508
(2.586)

1.175
(6.133)
1.067
(5.459)

1.138
(3.031)
.983
(2.363)

-4.667
(-4.069)
-3.666
(-2.611)

.492

2.67

.432

2.50

3.317
(3.412)
2.455
(2 126)

.801
(5.244)
.997
(4.637)

.900
(2.223)
.503
(1.138)

-4.807
(-4.159)
-2.743
(-1.899)

.454

2.77

.407

2.55

4.945
(4.541)
5.400
(4.339)

.521
(3.149)
.417
(1.937)

.838
(1.718)
.473
(.813)

-4.997
( - 4 . 1 16)
-3.857
(-2.646)

.352

3.02

.256

2.86

3.228
(2.020)
3.290
(2.205)

.540
(3.098)
.494
(2.956)

.934
(1.945)
.501
(.935)

-5.076
(-4.182)
-3.731
(-2.545)

.357

3.01

.314

2.74

a
T h e e q u a t i o n s w e r e e s t i m a t e d using a third-order p o l y n o m i a l distributed lag with m o n e y and fiscal variables lagged five quarters and
the coefficients of the final lagged variables constrained to be zero.
T h e n u m b e r s in p a r e n t h e s e s are r-statistics.
b
T h e a and b e q u a t i o n s d i f f e r in s a m p l e p e r i o d s . T h e period for
the a e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 8 Q 2 ; the period for the b e q u a t i o n s
is 1 9 6 0 Q 4 to 1 9 7 4 Q 2 .

G N P , although considerable care must be used
in interpreting such results. 3 7
The reduced-form results for proposed M - l
are given in equations 7.1a and 7 . 1 b . As in the
case of the money demand estimates, two equations are presented for each aggregate. Both
sample periods begin in late 1960, but the first
ends in mid-1978 while the second ends in
mid-1974. In addition, the last column contains
the root mean-square error for postsample forecasts over the period f r o m mid-1974 to mid1978, and indicates the recent forecasting record
of the monetary aggregate.
The sum of the coefficients of proposed M - l
— s h o w n in the second column—is near unity, the
value suggested by some economic theories.
Also, the results for proposed M - l are very
similar to those for current M - 1 , shown in table
37
Reduced-form estimates of the contribution of
changes in m o n e y to changes in G N P can be artificially
strengthened by reverse causality, running from G N P
to m o n e y . This is a problem primarily of interpreting
the coefficient of the m o n e y variable for the current
quarter, but also the R2 and standard error of estimate.
In addition, should changes in a particular measure of
m o n e y tend to smooth growth in G N P , the estimated
impact of this variable on G N P in a reduced-form
equation would be understated.




Root
meansquare
error 0 (annual
percentage
rate)

' T h e fiscal variable is the c h a n g e in the h i g h - e m p l o y m e n t
deficit as a p e r c e n t of n o m i n a l potential G N P .
d
T h e strike variable is the c h a n g e in m a n h o u r s lost d u e to
as a p e r c e n t a g e of m a n h o u r s w o r k e d .
v
Root m e a n - s q u a r e error for d y n a m i c s i m u l a t i o n s over the
1 9 7 4 Q 3 to 1 9 7 8 Q 2 are based on coefficient e s t i m a t e s for the
period e n d i n g 1 9 7 4 Q 2 .

federal
strikes
period
sample

9. 3 8 For both proposed and current M - l , about
40 percent of the estimated impact of the monetary aggregate on G N P is felt in the current
quarter, but much of this may also reflect reverse
causality running f r o m G N P to money. A comparison of the root mean-square errors shows
that predictions based on proposed M - l have
been marginally better than those based on current M - l .
The sum of the money supply coefficients for
the broader proposed monetary aggregates is
smaller than the sum for proposed M - l . However, the contemporaneous relationship between
money and G N P is less strong for these broader
aggregates than for M - 1 , and a relatively large
share of the overall measured contribution of
money growth to G N P growth is attributed to
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-

38
In both instances, the sum of m o n e y coefficients
does not differ much for the two sample periods. This
result contrasts with those for the M - l demand equations, which suggest a shift in the relationship between
m o n e y and G N P in the p o s t - 1 9 7 4 period. This matter
is discussed in more detail in Porter and others, "Current and Proposed Monetary A g g r e g a t e s . "

Redefining

the Monetary

Aggregates

29

8. Individual lag coefficients for proposed monetary aggregates and a fiscal variable
from reduced-form equations a
P r o p o s e d M-1 4-

Proposed M - l
Lag
length

Equation 7 . 1 a
Money

Equation 7.1b

Equation 7 . 2 a

Fiscal
Fiscal
Fiscal
variable M o n e y variable M o n e y variable M o n e y
.259
(1.826)

Proposed M-3

Proposed M-2

Equation 7 . 2 b

Equation 7 . 3 a

Equation 7 . 3 b

Fiscal
Fiscal
Fiscal
variable M o n e y variable M o n e y variable

Fiscal
Fiscal
variable M o n e y variable M o n e y

0

.444
.180
.373
.370
(2.936) (1.481) (2.362) (2.131)

1

.245
.225
.231
(2.201) (2.135) (2.126)

.076
(.528)

.043
.203
(.455) (1.678)

2

.278
.177
.173
(1.807) (2.626) (1.782)

.087
(.672)

.078
.259
.119
(.897) (2.287) (1.252)

3

.260
.165
.177
.208
(2.434) (2.614) (2.385) (1.800)

4

.174
.150
.127
.243
(1.561) (1.748) (1.360) (1.910)

.057
.326
(.457) (1.953)

.186
.156
(1.085) (1.024)

.099
-.029
(.922) ( - 1 9 9 )

.050
(.367)

Equation 7.4b

Equation 7 . 4 a

.120
(.659)

.105
(.553)

.011
(.064)

.088
(.653)

.060
(.365)

.169
(.922)

.176
.049
(.501) (1.228)

.041
-.077
.129
.235
(.382) (-.424) (1.263) (1.659)

.066
.236
(.729) (1.728)

.056
(.547)

.014
.168
.269
(.085) (1.737) (1.986)

.116
(1.238)

.030
(.188)

.195
.236
.219
(3.285) (2.194) (3.327)

.141
.227
.098
.121
(1.133) (1.932) (1.777) (1.393)

.186
.147
.221
(1.164) (2.442) (1.716)

.132
(2.417)

.136
(.890)

.234
.225
.146
(2.514) (1.397) (2.383)

.193
.149
.128
(1.459) (1.322) (1.257)

.245
(1.560)

.103
.173
(1.122) (1.122)

.012
(.088)

a
T h e n u m b e r s in p a r e n t h e s e s are /-statistics. See table 7 for regression results. T h e a and b e q u a t i o n s differ in s a m p l e p e r i o d . T h e s a m p l e

.102
(.917)

.085
.121
(.875) (1.003)

-.006
.082
(.844) (-.034)

period for the a e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 8 Q 2 ; the period f o r the
b e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 4 Q 2 .

9. Reduced-form equations relating percentage change in nominal GNP to percentage changes in current
monetary aggregates, a fiscal variable, and a strike variable 11
S u m m a r y statistic

I n d e p e n d e n t variable
Current
monetary
aggregateh

M-l
8.1a
8. l b

Constant

S u m of
money
coefficients

S u m of
fiscal
coefficients 1 '

Strike
variable' 1

Adjusted
R2

Standard
error of
estimate
(annual perc e n t a g e rate)

2.382
(2.346)
2.656
(2.842)

1.129
(5.833)
1.016
(5.492)

1.184
(3.093)
1.047
(2.553)

-4.987
(-4.328)
-4.075
(-2.897)

.473

2.72

.424

2.51

.681
(.496)
1.090
(.820)

.955
(5.504)
.877
(4.996)

.997
(2.583)
.614
(1.466)

-5.142
(-4.413)
-3.454
(-2.405)

.452

2.78

.413

2.54

1.418
(1.015)
1.863
(1.203)

.769
(4.841)
.699
(3.755)

.971
(2.368)
.610
(1.288)

-5.239
(-4.451)
-3.633
(-2.479)

M-2
8.2a
8.2b
M-3
8.3a
8.3b

.431

2.83

.361

2.65

Root meansquare e r r o r e
( a n n u a l perc e n t a g e rate)

3.90

4.03

3.88

(
T h e fiscal variable is the c h a n g e in the h i g h - e m p l o y m e n t
deficit as a p e r c e n t a g e of n o m i n a l potential G N P .
d
T h e strike variable is the c h a n g e in m a n h o u r s lost d u e to
as a p e r c e n t a g e of m a n h o u r s w o r k e d .
e
Root m e a n - s q u a r e errors for d y n a m i c s i m u l a t i o n s over the
1 9 7 4 Q 3 to 1 9 7 8 Q 2 are b a s e d on coefficient e s t i m a t e s f o r the
period e n d i n g 1 9 7 4 Q 2 .

a
T h e e q u a t i o n s w e r e e s t i m a t e d using a third-order p o l y n o m i a l distributed lag with m o n e y and fiscal variables lagged five quarters and
the coefficients of the final lagged variables c o n s t r a i n e d to be zero.
T h e n u m b e r s in p a r e n t h e s e s are /-statistics.
h
T h e a and b e q u a t i o n s differ in s a m p l e p e r i o d . T h e period for the
a e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 8 Q 2 ; the period for the b e q u a t i o n s is
1 9 6 0 Q 4 to 1 9 7 4 Q 2 .

federal
strikes
period
sample

10. Individual lag coefficients for current monetary aggregates and fiscal variable
from reduced-form equations' 1
Current M-1
Lag
length

Equation 8.1a
Money

Fiscal
variable

0

,405
(2.626)

1

Current M - 2

Equation 8.1b
Money

Fiscal
variable

.178
(1.431)

.292
(1.869)

.257
(2.400)

.263
(2.262)

2

.192
(1.962)

3
4

Equation 8.2a
Money

Fiscal
variable

.375
(2.148)

.191
(1.309)

.264
(2.494)

.109
(.773)

.297
(2.768)

.218
(2.214)

.161
(2.199)

.271
(2.672)

.113
(1.143)

.175
(1.732)

Equation 8.3a

Money

Fiscal
variable

Money

.107
(.863)

.205
(1.395)

.253
(1.477)

.030
(.184)

.163
(1.782)

.267
(2.330)

.131
(1.488)

.058
(.422)

.1 14
(.903)

.196
(2.289)

.290
(2.701)

.159
(1.921)

.157
(2.342)

.215
(1.890)

.224
(3.977)

.222
(2.129)

.084
(.892)

.235
(1.856)

.181
(2.168)

.110
(1.059)

a
T h e n u m b e r s in p a r e n t h e s e s are /-statistics. See table 8 for the
regression results. T h e a and b e q u a t i o n s differ in s a m p l e p e r i o d . T h e




Current M - 3

Equation 8.2b

Fiscal
variable

Equation 8.3b
Money

Fiscal
variable

.114
(.875)^

.078
(.437)

.184
(1.035)

.162
(1.575)

.260 *
(2.120)

.097
(.903)

.022
(-144)

.051
(.395)

.223
(2.294)

.279
(2.434)

.157
(1.525)

.059
(419)

.204
(3.863)

.116
(.943)

.215
(3.599)

.213
(1.958)

.200
(3.256)

.160
(1.187)

.179
(2.262)

.137
(1.040)

.140
(1.455)

.105
(991)

.168
(1.672)

.186
(1.327)

sample period for the a e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 8 Q 2 ; the period
for the b e q u a t i o n s is 1 9 6 0 Q 4 to 1 9 7 4 Q 2 .

30

Federal Reserve Bulletin • January 1979

diet G N P growth slightly better than does current M - 2 , while the recent prediction record for
proposed M-3 is poorer than that of current M-3.

Indicator

Properties

Since measures of the monetary aggregates are
available with a relatively short lag, they may
serve as valuable indicators of the current state
of the e c o n o m y , before direct information is
available, and thus permit more timely adjustments of policy. 3 9 Table 11 contains estimates
of the various current and proposed measures
of money as indicators of G N P growth for three
periods—the period of the 1960s, the period of
the 1970s, and the entire sample period. 4 0 In
essence, the numbers show the extent to which

39
S o m e nonfinancial variables, such as retail sales,
are also available with a relatively short lag and can
be used as indicators of m o v e m e n t s in e c o n o m i c activity.
40
See P. A . T i n s l e y , P. A . Spindt, with M . E. Friar,
"Indicator and Filter Attributes of Monetary Aggregates: A Nit-Picking Case for D i s a g g r e g a t i o n " (Board
of Governors of the Federal Reserve S y s t e m , D i v i s i o n
of Research and Statistics, Special Studies Section,
October 1978; processed). The authors conclude that
more useful information about the state of the e c o n o m y
can be obtained by using the components of monetary
aggregates jointly than by using the aggregates themselves.

11. Monetary Aggregates as Indicators of GNP
Growth
Percent
Indicator v a l u e a
M o n e t a r y aggregate

Proposed
M-l
M-1 +
M-2
M-3
Current
M-l
M-2
M-3

1960Q41978Q2

1960Q4—
1969Q4

1970Q11978Q2

33
22
13
11

18
6

36
17
18
7

29
17
14

15
5

30
13
11

*
*

SOURCE: Based on P. A . T i n s l e y , P. A . S p i n d t , with M . E. Friar,
" I n d i c a t o r and Filter Attributes of M o n e t a r y A g g r e g a t e s : A N i t - P i c k i n g
C a s e for D i s a g g r e g a t i o n " ( B o a r d of G o v e r n o r s of the Federal R e s e r v e
S y s t e m , Division of R e s e a r c h and Statistics, Special Studies S e c t i o n ,
O c t o b e r 1978; p r o c e s s e d ) , p p . 3 1 - 3 2 .
a
T h e p e r c e n t a g e by w h i c h the v a r i a n c e of the forecast error of the
g r o w t h rate of nominal G N P can be r e d u c e d using current o b s e r v a t i o n s
on the g r o w t h rate of the c o r r e s p o n d i n g m o n e t a r y a g g r e g a t e . T h e s e
values w e r e obtained by r e g r e s s i n g the p e r c e n t a g e c h a n g e in n o m i n a l
G N P on the p e r c e n t a g e c h a n g e in the c o r r e s p o n d i n g m o n e t a r y a g g r e g a t e .
T h e R2 statistic, a d j u s t e d for d e g r e e s of f r e e d o m , is then a m e a s u r e
of the p e r c e n t a g e by w h i c h the v a r i a n c e of f o r e c a s t e d G N P can be
r e d u c e d by o b s e r v i n g the c h a n g e in the m o n e t a r y a g g r e g a t e .
* Negligible.




deviations in the rate of growth of G N P f r o m
trend can be detected using deviations in the
rates of growth of alternative measures of
money f r o m trend. A higher indicator value for
a monetary aggregate means that more can be
inferred f r o m it about current growth in G N P .
In the limit, with an indicator value of 100,
variations in monetary growth would serve as
perfect indicators of both the direction and the
magnitude of variations in G N P growth.
In general, the narrower measures of money
contain more useful information about underlying G N P growth than do the broader aggregates.
For the proposed aggregates, indicator values
generally decline with each successive level of
aggregation. In addition, proposed M - l tends
to be a better indicator of G N P growth than is
current M - l , particularly during the 1970s.
While the indicator value of proposed M - 2 was
very low for the 1960s, it increased considerably
in the 1970s; indeed, for the period of the
1970s, proposed M-2 had a higher indicator
value than current M-2. As an indicator of G N P
growth, current M - 3 tends to outperform proposed M - 3 . 4 1

CONTROLLABILITY

Another important consideration in selecting
monetary aggregates is how well the Federal
Reserve can control their size and rate of
growth. Some aggregates, while closely linked
to ultimate targets, may be difficult to control
with the available instruments of monetary policy. T o a considerable extent, the Federal Reserve's control over a monetary aggregate will
depend on the system's operating procedures—
whether its operating target is reserves or shortterm interest rates.

41
N o t e that the indicator results are for a highly
simplified situation, one for which no specific model
of the e c o n o m y is utilized. Alternatively, econometric
models of the e c o n o m y , such as the board's quarterly
m o d e l , can be used to relate forecast errors in m o n e y
growth to forecast errors in G N P growth; in this w a y ,
the accuracy of G N P forecasts can be improved as
information on m o n e y growth b e c o m e s available. Estimations of the indicator value of alternative measures
of m o n e y using more sophisticated procedures yield
results that are qualitatively similar to the ones discussed
here.

Redefining

Under a reserves operating target, a key factor
in monetary control is the nature of the reserve
requirements applied to the components of the
monetary aggregate. Deposits that are subject
to reserve requirements established by the Federal Reserve and for which required reserves
must be held as vault cash or deposits with the
Federal Reserve are generally those that can be
controlled best through use of a reserves aggregate. 4 2 Although other deposits—those of nonmember institutions—may be backed indirectly
by reserves at the Federal Reserve through deposit balances held with member bank correspondents, the slippage between the provision
of reserves by the Federal Reserve and the
volume of such deposits is typically more pronounced than the slippage for deposits directly
subject to the system's reserve requirements.
Table 12 shows the proportions of each of
the proposed (and current) measures of money
that are subject to reserve requirements established by the Federal Reserve. Larger proportions of the proposed M - l and M - l - f measures
than of the proposed broader aggregates are
subject to Federal Reserve reserve requirements.
A comparison of the proposed aggregates with
their current counterparts reveals that by and
large smaller percentages of the proposed aggregates are subject to system reserve requirements. Thus, with a reserves operating target,
control might be weaker over the proposed
aggregates than over the current aggregates,
unless legislation were approved extending reserve requirements to the monetary liabilities of
nonmember institutions.
With an interest rate operating target, control
over a monetary aggregate depends on whether
the demand for that aggregate is sensitive to

42
Required reserve ratios are also important to monetary control. In general, with higher ratios the control
over monetary aggregates is strengthened with a reserves operating target. A l s o , monetary control under
a reserves operating target is enhanced when similar
ratios are required for the various deposits included in
the aggregate. See Kenneth J. K o p e c k y , " T h e Relationship between Reserve Ratios and the Monetary
Aggregates under Reserves and Federal Funds Rate
Operating T a r g e t s , " Staff E c o n o m i c Studies 100 (Board
of Governors of the Federal Reserve S y s t e m , D e c e m b e r
1978).




the Monetary

Aggregates

31

12. Proportion of monetary aggregates subject
to reserve requirements set by the Federal
Reserve, June 1978
Percent
Total
aggregate "

Deposits

Proposed
M-l
M-1 +
M-2
M-3

75.8
73.2
49.3
44.7

66.9
67.9
43.0
41.0

Current
M-l
M-2
M-3

76.4
70.2
41.8

67.9
66.5
37.1

Aggregate

a
Currency is treated as subject to a 100 percent Federal Reserve
reserve requirement.

changes in short-term interest rates. 4 3 A desired
change in the quantity of a monetary aggregate
is achieved by varying the attractiveness of
holding the monetary aggregate through changes
in short-term interest rates.
Although a change in interest rates will have
a greater effect on those aggregates that are most
interest sensitive, what is important f r o m the
standpoint of controlling money using interest
rates is whether the particular aggregate under
consideration is in fact sensitive to interest rates.
Indeed, economic theory establishes that in
achieving some desired monetary stimulus the
quantities of monetary aggregates that are highly
sensitive to changes in interest rates must be
changed by m o r e — i n relative terms—than aggregates that are less sensitive to interest rates;
hence, while a given change in interest rates
will have 3 greater impact on the quantities of
highly interest-sensitive monetary aggregates, a
larger change in their quantities is needed to
obtain an economic objective.
All of the proposed monetary aggregates
move inversely to changes in the treasury bill
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

43
In addition, control over a monetary aggregate
under an interest rate operating target is importantly
influenced by the ability to forecast the impact of other
factors, particularly G N P , on the public's demand for
this aggregate. In other words, the stability of the
relationship between the public's demand for an aggregate and the explanatory variables, such as G N P and
interest rates, together with the accuracy of projections
of explanatory variables other than interest rates, determines the potential controllability of this aggregate.

32

Federal Reserve Bulletin • January 1979

proposed M-2. In addition, a comparison of
tables 5 and 6 suggests that the impact of
changes in interest rates on the proposed monetary aggregates is about the same as that on their
current counterparts. Thus, with an interest rate
operating target, controlling the proposed monetary aggregates would likely be no more difficult than controlling the current measures. 4 4

CONSOLIDATION

The monetary aggregates being proposed by the
board staff have been constructed using principles of account consolidation to exclude those
deposits held by depositary institutions with
other depositary institutions that would otherwise lead to double counting. In particular, at
each level of aggregation an attempt has been
made to net out deposits maintained by depositary institutions for purposes of servicing other
deposits included in the measure. 4 5 This procedure yields a more accurate estimate of the
public's monetary assets.
Consolidation involves primarily the appropriate netting out of some or all demand deposits
at commercial banks owned by commercial
banks and, for the broader measures, by other
depositary institutions. A depositary institution
can increase the liquidity, and thus the attractiveness, of its deposit liabilities by maintaining
demand balances that can be used to meet the
withdrawal requests of its customers; such demand balances may also serve as clearing balances. For example, commercial banks hold
demand balances with other commercial banks,
a large portion of which is used for conducting
44
Another consideration in controlling a monetary
aggregate with an interest rate target is the influence
of unpredictable factors on the demand for that aggregate. The greater the influence of unpredictable factors
on m o n e y 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 m o n e y demand, suggest that the
effects of unpredictable influences have been roughly
similar on the proposed monetary aggregates and on
their current counterparts, particularly in the cases of
the narrower aggregates.
45
This is in line with the recommendation of the
Advisory Committee on Monetary Statistics. This recommendation served as a guide in consolidating accounts in the proposed monetary aggregates. See Improving the Monetary
Aggregates:
Report, pp. 1 2 - 1 7 .




their own demand deposit business. Simply
combining all demand deposits at all commercial banks would overstate the public's holdings
of demand balances by the amount of such
interbank demand balances, because demand
balances held by commercial banks for use in
their own demand deposit business would be
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 institutions for conducting their savings business
would be netted out from proposed M-2, and
demand balances maintained by depositary institutions for conducting their time deposit
business would be netted from proposed M-3.
Consolidation similarly involves the netting
out of some savings and time deposits in constructing the broader monetary aggregates. This
matter is described in more detail in the appendix.
While in principle this kind of consolidation
is straightforward, in practice data limitations
necessitate some compromises. For example,
although demand deposits between commercial
banks can be estimated with some precision, the
proportions held for conducting demand, savings, and time deposit business are unknown.
As a consequence, the conventional practice of
deducting all interbank demand deposits from
gross demand deposits has been followed here,
although it tends to understate somewhat the
appropriate measure of the public's demand
deposits. In addition, shortcomings in the data
render it difficult to measure and to allocate by
function all demand deposits owned by thrift
institutions, although an effort was made to
allocate by function demand deposits owned by
mutual savings banks. These and other issues
regarding the mechanics of consolidation are
discussed in the appendix.

DATA

AVAILABILITY

AND DATA

NEEDS

All proposed monetary aggregates are available
on a monthly basis from existing sources. 4(i Data
46
Preliminary historical data on the proposed monetary aggregates and related series are available from the
Board of Governors of the Federal Reserve S y s t e m ,
Division of Research and Statistics, Banking Section.

Redefining

on total deposits for thrift institutions—the sum
of savings and time deposits—are available as
of the end of each month with a lag of about
one week. 4 7 At that time, savings deposits at
thrift institutions can be crudely estimated for
inclusion in M-2, until actual figures on savings
are available about one month later. Breakdowns of total savings deposits at thrift institutions into transactions balances—for inclusion
in proposed M - l — a n d ordinary savings balances must be estimated until figures are available on NOW accounts and share draft balances
at credit unions, which involves an additional
two-month lag. The lack of timely data on the
breakdown of savings and transactions balances
at thrift institutions does not affect the estimation of proposed M-3, since total deposits at
these institutions are included in this aggregate.
In addition to monthly availability, commercial bank demand deposits, savings deposits,
and time deposits are estimated weekly with a
lag of one week. However, with existing data,
any weekly estimations of thrift institution deposits would likely be subject to unusually large
estimation errors.
Should the proposed monetary aggregates be
47
H o w e v e r , sample data on total deposits at thrift
institutions are available more promptly and can be used
to prepare early estimates of the monetary aggregates.

APPENDIX:

NOTE. This appendix was prepared by N e v a Van
Peski, Economist, Banking Section, Division of Research and Statistics. Norman Mauskopf and Nancy Hill
assisted in constructing the proposed monetary aggregates and related series.

Aggregates

33

adopted and current data flows used, the quality
of initially published estimates of M - l and M-2
is likely to deteriorate and such estimates are
likely to be subject to greater revisions than
is currently the case. 4 8 In order to reduce the
size and frequency of such revisions, publication of the monetary aggregates could be delayed from the current schedule or, alternatively, new data could be collected; in particular, timely data on ATS balances, NOW account
and other transactions balances, and savings and
time balances at thrift institutions would be
needed. 4 9 The collection of such data from nonmember institutions would require the cooperation of the Federal Deposit Insurance Corporation, the Federal Home Loan Bank Board, and
the National Credit Union Administration.
Moreover, an accurate and comprehensive
series on commercial bank repurchase agreements with the nonbank public would require
the collection of new data.

48

See the appendix section on timeliness of data.
A l s o , data on the deposit holdings of savings and
loans and credit unions w o u l d be needed in order more
accurately to consolidate accounts and improve measures of the public's m o n e y holdings. A s noted in the
previous section, only an incomplete consolidation can
be done using existing data on the deposit holdings of
thrift institutions.
49

DATA SOURCES AND CONSTRUCTION
MONETARY
AGGREGATES

This appendix describes in detail the data
sources and the construction of the components
of the monetary aggregates being proposed by
the board staff . Some of these components were
called for by the exclusion from the proposed
aggregates of deposits of foreign banks and
official institutions, others by the grouping of
similar deposits across depositary institutions in
the proposed aggregates. Still others were de-




the Monetary

OF THE

PROPOSED

veloped to meet the concept of consolidation
used in this redefinition of the monetary aggregates.
While the new series have been carefully
constructed, they should be regarded as preliminary until the staff has received comments on
them and has made a final review of the data.
The first section of this appendix lists the components of each of the proposed aggregates; it
is followed by a discussion of the timeliness
of the data on the components and by a description of current data sources. The next section
discusses consolidation of interinstitution deposits, and the final section briefly describes the
seasonal adjustment of the new series.

34

Federal Reserve Bulletin • January 1979

A l . Components of the Monetary Aggregates

Component

Currency
Currency outside Treasury, Federal Reserve,
and vaults of commercial banks
Demand
deposits
Commercial banks
D e m a n d deposits adjusted, excluding all
bank and foreign official
deposits' 1
Due to mutual savings banks

June 1978
average
(millions
of dollars)"

92,923

Daily, m e m b e r banks (1-week lag)
Quarterly, n o n m e m b e r banks
(4-month lag)
W e e k l y , large banks (1-week lag)
Quarterly, other banks (4-month lag)
W e e k l y , large banks (1-week lag)
Quarterly, other banks (4-month lag)

1/59

Quarterly (4-month lag)
W e e k l y , large banks (1-week lag)
Quarterly, other banks (4-month lag)
Daily (1 -week lag)
Daily (1 -week lag)

1/59
1/59

1,409'

Daily (1-week lag)

1/59

2,055

Monthly (6-week lag)

1/71

2.41,584
1,408

Due to banks in territories
and possessions
Due to foreign official institutions

235
1,285

Savings
deposits
Commercial banks
Total excluding all b a n k , foreign
official, and U . S . g o v e r n m e n t
deposits, and N O W accounts
Due to banks and foreign official
institutions
Due to U . S . government
Foreign-related institutions

First inclusion
in proposed
aggregate

1/59

7,303

At savings and loans
At mutual savings banks
Credit union share draft accounts
Federal Reserve
Foreign and international deposits at
Federal Reserve Banks

Frequency and timing
of current data 1

Daily (1 -week lag)

Due to foreign banks

Federal Reserve float
Cash-items-bias adjustment
Foreign-related institutions 1 '
D e m a n d deposits adjusted, excluding
banks and foreign official deposits
Due to foreign banks and official
institutions
Other deposits subject to transfer by draft
D e m a n d deposits at mutual savings banks
N O W accounts
At commercial banks

Treatment in
monetary aggregate 1 '
Proposed I Current

-5,149
8,152

1/59
1/59

1/59
1/59

864

Eh

Quarterly (3-month lag)

1/63

2,080

Eh
Eh
Eh
Eh

Daily, member banks (1-week lag)
Monthly, other banks (3-month lag)
Monthly (3-month lag)
Monthly (3-month lag)
Quarterly (3-month lag)

1/74

311
870
576

Daily (1 -week lag)

1/59

Daily, m e m b e r banks (1-week lag)
Quarterly, n o n m e m b e r banks (4-month lag)

1/59

W e e k l y , large banks only (1-week lag)
Quarterly (4-month lag)
Monthly (6-week lag)

29
62
278

1/74
1/73
1/76

11/75
1/76
1/73

M-2
Savings
deposits
Commercial banks
Total excluding all b a n k , foreign
official, U . S . government
deposits, and N O W accounts
Due to banks and foreign
official institutions
Due to U . S . government
Foreign-related institutions
Thrift institutions' 4
Mutual savings banks, excluding
N O W accounts
Savings and loans, excluding
N O W accounts
Credit union shares, excluding
share draft accounts
Savings of credit unions at
credit unions
Consolidation component: d e m a n d
deposits due to mutual savings banks
held at commercial banks to back
savings deposits

COMPONENTS OE THE NEW

221,282

278

IJ
E
E

W e e k l y , large banks only (1-week lag)
Quarterly (4-month lag)
Monthly (6-week lag)

29

62

11/75
1/76
1/73

76,901

E

Monthly (6-week lag)

1/59

147,949

E

Monthly (4-week lag)

1/59

50,857

E

Monthly (4-week lag)

1/59

-1,168

E
E

Annually (6-month lag)
W e e k l y , large banks (1-week lag)
Quarterly, other banks (4-month lag)

1/64
1/59

-802

AGGREGATES

Table A l lists the components of the proposed
monetary aggregates. The table gives the June
1978 average for each component and indicates
whether it was used in the construction of the
proposed aggregate and the comparable current
aggregate; a negative sign attached to the June




Daily, member bank (1-week lag)
Quarterly, n o n m e m b e r s (4-month lag)

average indicates that the item enters the calculation as a subtraction f r o m the total. Also
shown are the frequency and timeliness of the
basic data and the date when the component was
first included in the aggregates. With few exceptions, new components were included in the

Redefining

the Monetary

35

Aggregates

A l . Continued.
Component

June 1978
average
(millions
of dollars) 11

First inclusion
in n e w
aggregate

T r e a t m e n t in
monetary aggregate"
Proposed 1 Current

First inclusion
in n e w
aggregate

M-3
deposits
Time
Commercial banks
Total e x c l u d i n g all b a n k ,
f o r e i g n official, and U . S . g o v e r n ment deposits
D u e to d o m e s t i c c o m m e r c i a l b a n k s
D u e to f o r e i g n and mutual
s a v i n g s b a n k s , and f o r e i g n official
institutions
D u e to U . S . g o v e r n m e n t
Foreign-related institutions 1 '
T o t a l , e x c l u d i n g all bank and
f o r e i g n official d e p o s i t s
D u e to f o r e i g n b a n k s and
official institutions
D u e to d o m e s t i c c o m m e r c i a l b a n k s
T h r i f t institutions
Mutual savings banks
S a v i n g s and loans
Consolidation component: demand deposits
d u e to mutual s a v i n g s b a n k s held at c o m mercial b a n k s to back time d e p o s i t s
MEMO: O v e r $ 1 0 0 , 0 0 0 included in total

NOTES

TO TABLE

335,699

I

6,862

E

D a i l y , m e m b e r b a n k s ( 1 - w e e k lag)
Q u a r t e r l y , other b a n k s ( 4 - m o n t h lag)
E

W e e k l y , large b a n k s ( 1 - w e e k lag)
Q u a r t e r l y , other b a n k s ( 4 - m o n t h lag)
W e e k l y , large b a n k s ( 1 - w e e k lag)
Q u a r t e r l y , other b a n k s ( 4 - m o n t h lag)

1/59
1/59
1/59

9,232

E

I

942

E

E

W e e k l y , large b a n k s ( 1 - w e e k lag)
Q u a r t e r l y , other b a n k s ( 4 - m o n t h lag)

1/59

8,184

I

IN

M o n t h l y ( 6 - w e e k lag)

1/59

2,236
792

E
E

I"

En

M o n t h l y ( 6 - w e e k lag)
M o n t h l y ( 6 - w e e k lag)

1/59
1/73

59,057
257,015
-605

I
I
I

I
I
I

M o n t h l y ( 6 - w e e k lag)
M o n t h l y ( 4 - w e e k lag)
W e e k l y , large b a n k s ( 1 - w e e k lag)
Q u a r t e r l y , other b a n k s ( 4 - m o n t h lag)

1/59
1/59
1/61

W e e k l y , large b a n k s ( 1 - w e e k lag)"
Monthly, foreign-related
institutions ( 6 - w e e k lag)
Q u a r t e r l y , other b a n k s ( 4 - m o n t h lag)

1/59

165,320

m

I

( i.

m)

AI

a
A m i n u s sign indicates that the c o m p o n e n t w a s subtracted in
calculating the total; all other c o m p o n e n t s were a d d e d .
b
" i " indicates the c o m p o n e n t w a s used in the c o n s t r u c t i o n of the
a g g r e g a t e ; " E " m e a n s the c o m p o n e n t w a s not used.
c
" F r e q u e n c y " refers to the f r e q u e n c y with w h i c h basic d a t a are
r e p o r t e d ; " t i m i n g " ' r e f e r s to the lag b e t w e e n the date for w h i c h d a t a
are reported and availability of final d a t a . For m a n y c o m p o n e n t s ,
p r e l i m i n a r y e s t i m a t e s are m a d e based on s a m p l e data or related series
and revised w h e n final data b e c o m e a v a i l a b l e .
d
" D e m a n d d e p o s i t s a d j u s t e d ' ' is e l s e w h e r e defined as gross d e m a n d
d e p o s i t s less d e p o s i t s of d o m e s t i c c o m m e r c i a l b a n k s , U . S . g o v e r n m e n t
d e p o s i t s , and cash items in the p r o c e s s of c o l l e c t i o n . T h e item s h o w n
here also e x c l u d e s d e p o s i t s of f o r e i g n b a n k s and official institutions
and mutual s a v i n g s b a n k s .
° Includes a g e n c i e s and b r a n c h e s of f o r e i g n b a n k s , E d g e Act corp o r a t i o n s e n g a g e d in b a n k i n g , and N e w York State f o r e i g n i n v e s t m e n t
c o m p a n i e s . A portion of d e m a n d d e p o s i t s at E d g e c o r p o r a t i o n s is
included in the c a s h - i t e m s - b i a s a d j u s t m e n t .
f
T h i s item is slightly larger in the p r o p o s e d M - l than in the current
M - l b e c a u s e of a technical a d j u s t m e n t , so that the c o m p o n e n t s s h o w n
d o not add e x a c t l y to the current M - l .
K
A small a m o u n t of d e m a n d d e p o s i t s a d j u s t e d held by E d g e Act
c o r p o r a t i o n s outside N e w York is not included in the current a g g r e g a t e s ,
but is included in the p r o p o s e d a g g r e g a t e s .
h
T h e s e c o m p o n e n t s are e x c l u d e d f r o m the current M - l but included
in M-1 + . N O W a c c o u n t s at c o m m e r c i a l b a n k s are included in the

current M-2 and N O W a c c o u n t s at s a v i n g s and loans and m u t u a l s are
included in the current M - 3 .
' T i m e and s a v i n g s d e p o s i t s d u e to d o m e s t i c c o m m e r c i a l b a n k s and
the U . S . g o v e r n m e n t are e x c l u d e d f r o m the current M - 2 . B e c a u s e m o s t
of such d e p o s i t s are time d e p o s i t s , n o a d j u s t m e n t w a s m a d e to the
current M - 1 + f o r the s a v i n g s portion of the a m o u n t e x c l u d e d ; this
a d j u s t m e n t is m a d e in the p r o p o s e d M - 1 + .
j
A small portion of this i t e m , savings d u e to d o m e s t i c c o m m e r c i a l
b a n k s , is e x c l u d e d f r o m the current M-2.
k
Includes m u t u a l s a v i n g s b a n k s , savings and loan a s s o c i a t i o n s , and
credit u n i o n s . S a v i n g s c o m p o n e n t e x c l u d e s N O W a c c o u n t s , w h i c h
appear in the p r o p o s e d M - l .
I
Partly e x c l u d e d .
m
L a r g e (over $ 1 0 0 , 0 0 0 ) n e g o t i a b l e C D s issued by large b a n k s are
e x c l u d e d f r o m the current M - 3 but included in the current M - 4 and
M - 5 ; other large time d e p o s i t s are included in current M - 2 and M - 3 .
II
In the current M - 2 and M - 3 , time d e p o s i t s at b r a n c h e s of f o r e i g n
b a n k s (the bulk of the figures s h o w n ) are included along with those
of other n o n i n s u r e d b a n k s ; such d e p o s i t s include d e p o s i t s of f o r e i g n
b a n k s and official institutions, but e x c l u d e d e p o s i t s of d o m e s t i c b a n k s .
T i m e d e p o s i t s at the other f o r e i g n - r e l a t e d institutions are not included
in the current a g g r e g a t e s .
° Total time d e p o s i t s are available daily with a o n e - w e e k lag f r o m
m e m b e r b a n k s ; the division b e t w e e n large and small t i m e d e p o s i t s is
based on w e e k l y data f r o m large b a n k s and quarterly data f r o m other
banks.

measures of the aggregates in January of the
year in which they first exceeded $50 million.
For components based on monthly, quarterly,
or semi-annual observations, monthly and
weekly averages were derived by interpolating
between observations or by applying ratios interpolated between benchmark observations to
related series. For series with single-day observations each week (Wednesday), the single-day
figures were used for the weekly series, and
monthly averages were derived by a proration
of the weeks; that is, the levels for the previous
six days were assumed to equal the Wednesday

observation, and the daily values thus assumed
were averaged over the month.
Table A l shows that the proposed M - l , like
the current M - l , includes currency and demand
deposits adjusted at commercial banks and
foreign-related institutions, plus adjustments for
Federal Reserve float and cash items bias. The
proposed M - l differs from the current M - l by
(1) excluding demand deposits due to foreign
banks and official institutions, (2) excluding
deposits held at the Federal Reserve by foreign
official and international institutions, (3) including transactions-related savings balances—




36

Federal Reserve Bulletin • January 1979

NOW accounts at both commercial banks and
thrift institutions and share draft accounts at
credit unions, and (4) including demand deposits at mutual savings banks. 5 0
The proposed M-1 + adds savings at commercial banks to the proposed M - l series. It
differs from the current M - l + in that it includes
savings at all foreign-related institutions engaged in banking in the United States; that is,
savings at agencies of foreign banks and New
York State foreign investment corporations have
been added to the proposed M - l 4 - while only
savings at branches of foreign banks were in
the current M-1 + . In addition, the proposed
M-1 + excludes demand and savings deposits
due to foreign banks and foreign official institutions. Also, a technical correction is made to
exclude small amounts of savings due to domestic commercial banks and the U.S. government that are now included in M-1 + .
The proposed M-2 adds to proposed M - l
savings deposits (net of transactions-related
savings already in proposed M - l ) at commercial
banks, foreign-related banking institutions in the
United States, and thrift institutions. The major
difference from the current M-2 is that savings
deposits at thrift institutions (mutual savings
banks, savings and loan associations, and credit
unions) are included, while time deposits at
commercial banks are excluded. Other differences are the inclusion of savings deposits
at agencies of foreign banks and New York
investment companies, the subtraction of a consolidation component (discussed below), and
the exclusion of savings deposits due to foreign
banks and official institutions.
The proposed M-3 comprises proposed M-2
plus time deposits at all commercial banks,
foreign-related institutions in the United States,
and thrift institutions. The major differences
from the current M-3 are the inclusion of negotiable certificates of deposit (CDs) at large commercial banks, the inclusion of time deposits
at foreign-related institutions, and the exclusion
50
The proposed M - l also includes A T S savings
deposits and similar transactions-related savings at thrift
institutions.




of deposits due to foreign banks and official
institutions. Also, a consolidation component
has been removed; it is discussed below.

TIMELINESS

OF

DATA

Table A l also shows the lag in availability of
data for the components of the proposed monetary aggregates. For commercial banks, data for
member banks and large weekly reporting banks
are available with a one-week lag following the
close of the statement week on Wednesday.
Preliminary estimates of deposits at nonmember
banks are made weekly from data on small
member banks, using the latest quarterly call
report as a benchmark. Final data on nonmember banks are available with about a fourmonth lag. 5 1
For savings and loan associations and mutual
savings banks, preliminary estimates of total
deposits are made from early data on deposit
flows available from a sample of these institutions: data for deposit flows at mutual savings
banks in New York State (accounting for a
substantial part of the total) during the first 23
days of the month are available before monthend, and deposit flows (for the sum of time and
savings deposits) from a sample of savings and
loan associations for the entire month are available within a week of month-end. Final monthend data for thrift institutions, including a savings and time deposit breakdown, are available
within four to six weeks.
The schedule of the availability of data—expressed as a percentage of the total of each aggregate—is summarized in table A2 for both the
proposed and the current monetary aggregates.
The major timing difference between the two
sets of aggregates occurs in M-2: because of
the inclusion of thrift savings deposits in the
proposed M-2, a smaller percentage of final data
is available on a timely basis than was available
for the current M-2, which includes only com51
Currently, the reliability and timeliness of a sample
of nonmember banks reporting w e e k l y are being tested.
The incorporation of these sample data for nonmember
bank deposits is expected to improve the early estimation of this component.

Redefining

A2. Timing of final data availability, proposed
and current monetary aggregates
Based on data for June

CURRENT

DATA

Aggregates

SOURCES

37

FOR

NEW

COMPONENTS

1978
Per c e n t of a c t u a l d a t a a v a i l a b l e ,
b y lag

Aggregate and c o m p o n e n t
One
weeka
Proposed
M - l = currency and checkable
deposits
S a v i n g s d e p o s i t s c o m p o n e n t of
M-1 +
M - l -I- = M - l p l u s b a n k s a v i n g s
S a v i n g s d e p o s i t s c o m p o n e n t of
M-2''
M - 2 = M - l p l u s all s a v i n g s d e p o s i t s ''
T i m e d e p o s i t s c o m p o n e n t of
M-3
M - 3 = M - 2 p l u s all t i m e d e p o s its'
Current
M - l = Currency and bank dem a n d deposits
Savings and checkable deposits
in M - 1 +
M-1+ = M-l
plus
checkable
d e p o s i t s at thrift institutions and commercial bank
savings
Time
and
savings
deposits
c o m p o n e n t of M - 2
M-2 = M-l
plus
commercial
bank savings and time deposits excluding large negotiable C D s
T h r i f t i n s t i t u t i o n c o m p o n e n t of
M-3
M - 3 = M - 2 plus thrift institution deposits
L a r g e n e g o t i a b l e C D s at l a r g e
commercial banks
M - 5 = M - 2 plus large negotiable C D s at large c o m m e r cial b a n k s

F o u r to
six w e e k s

a

Four
months1'

75.4

0.6

24.0

69.3
72.9

0.1
0.4

30.6
26.6

30.5

55.5

13.7

49.1

32.7

18.0

36.1

48.7

15.2

43.4

39.7

16.8

76.9

0.0

23.1

68.4

0.0

31.6

73.6

0.0

26.4

63.8

0.0

36.2

0.0

30.7

69.3

100.0"

0.0

40.8

41.2

18.1

100.0

0.0

0.0

38.9

17.0

0.0

44.1

a

E s t i m a t e s of all m o n e t a r y a g g r e g a t e s a r e m a d e o n e w e e k a f t e r t h e
W e d n e s d a y c l o s e of t h e w e e k b a s e d o n p a s t p a t t e r n s of b e h a v i o r a n d ,
in s o m e c a s e s , e a r l y e s t i m a t e s f r o m a s a m p l e of i n s t i t u t i o n s . M o s t of
t h e d a t a a v a i l a b l e in f o u r to six w e e k s a r e f r o m thrift i n s t i t u t i o n s a n d
foreign-related banking institutions.
h
M o s t of the d a t a a v a i l a b l e w i t h a f o u r - m o n t h lag are f r o m q u a r t e r l y
condition statements submitted by n o n m e m b e r b a n k s . Earlier estimates
of t h e s e d a t a a r e m a d e f r o m m e m b e r b a n k d a t a a n d b e n c h m a r k r a t i o s
f r o m t h e latest c o n d i t i o n r e p o r t .
' In t h e p r o p o s e d M - 2 a n d M - 3 a g g r e g a t e s , p e r c e n t a g e s s u m to
s l i g h t l y less t h a n 100 b e c a u s e o n e p a r t of t h e s a v i n g s d e p o s i t c o m p o n e n t
is a v a i l a b l e w i t h a s i x - m o n t h l a g .
d
V e r y g o o d e s t i m a t e s of total d e p o s i t s at s a v i n g s a n d l o a n a s s o c i a tions and mutual savings b a n k s are available o n e w e e k after the end
of t h e m o n t h . F i n a l d a t a b e c o m e a v a i l a b l e f o u r w e e k s a f t e r m o n t h - e n d
f o r s a v i n g s a n d l o a n s , a n d six w e e k s a f t e r m o n t h - e n d f o r m u t u a l s a v i n g s
banks.

mercial bank deposits. Currently, the timing of
data availability for the proposed M - l and
M-1 + is very close to that for the current M - l
and M - l + , although as N O W account balances
and other transactions-related savings deposits
grow in importance, either more timely data will
be required or the proportion of the aggregate
requiring estimation will increase. Data for the
proposed M - 3 are available on approximately
the same schedule as data for the current M-3
and M - 5 aggregates.




the Monetary

Most of the data for the proposed aggregates
are generated f r o m a few basic sources. For
several components of these aggregates, current
data come from sources that have been in existence only a few years, and back data were
estimated using a variety of sources and statistical procedures. 5 2

Banking

Institutions

The primary data sources for commercial banks
are the report of deposits filed weekly by m e m ber banks, the weekly report of condition, and
the quarterly report of condition (call report).
Report of Deposits. The daily report of deposits is submitted weekly to the Federal Reserve by all member banks to provide the information necessary for the computation of reserve
requirements. It provides daily figures from
which weekly averages are derived of the major
categories of bank deposits—demand, savings,
and time—plus certain cash assets that are also
used in the construction of the money stock
measures.
Weekly Report of Condition.
The weekly
report of condition is a detailed balance sheet
submitted by a group of large commercial banks
as of the close of business each Wednesday.
The number of weekly reporting banks varied
over the 1959-78 period but always included
more than 300 banks; at the end of 1978, 312
banks were in the sample, and these banks had
50 percent of the total deposits of all commercial
banks. 5 3

52

A

description

of

the calculation

of

the

back

is a v a i l a b l e f r o m t h e B o a r d of G o v e r n o r s of t h e
Reserve

System,

Banking
53

was

more

than

December
50

of

Research

and

Statistics,

Section.

Beginning

panel

Division

data

Federal

percent

in J a n u a r y

revised
$750
31,
of

to

million

1977.
the

1979,

include

The

assets

only

the

in d o m e s t i c
new
of

weekly

those

reporting

banks

having

office assets

panel has

as

of

approximately

all c o m m e r c i a l

banks.

38

Federal Reserve Bulletin • January 1979

Quarterly Report of Condition. The condition
report (or call report) is a detailed balance sheet
submitted by all insured commercial banks four
times each year and by noninsured commercial
banks and mutual savings banks twice each
year. 5 4
Member bank demand deposits adjusted,
savings deposits, and time deposits come from
the daily report of deposits. For nonmembers,
deposits are estimated using reported deposits
of small member banks, and are benchmarked
to the quarterly call report. Most other items
are taken from the weekly condition reports of
large banks and are estimated for other commercial banks using quarterly call report relationships. The items estimated in this fashion in
constructing proposed M - l are demand deposits
due to foreign official institutions and due to
mutual savings banks; in constructing proposed
M-2, savings deposits due to banks and foreign
official institutions; in constructing proposed
M-3, time deposits due to the U.S. government,
mutual savings banks, foreign banks, and domestic commercial banks; in constructing both
proposed M-2 and M-3, the demand, savings,
and time deposits due to mutual savings banks
used in consolidation. Savings deposits due to
the U.S. government are estimated from the call
reports for all commercial banks.
NOW Accounts. N O W accounts are reported
at month-end to the Federal Reserve Bank of
Boston by all institutions in New England that
offer them. Data for NOWs at commercial and
mutual savings banks in New York State are estimated from a sample of institutions that report
weekly to the Federal Reserve Bank of New
York. In addition, daily data on NOWs of
member banks in the First Federal Reserve District are available on the daily report of deposits.
As noted in the text, NOW accounts have been
permitted only fairly recently; mutual savings
banks in some New England states first offered
them in June 1972, and commercial banks and
54
The June and D e c e m b e r call reports are generally
filed as of the last days of those months. Until recently,
the spring and fall call dates varied, but generally
occurred in March or April for the spring call and
September or October for the fall call. Since September
1975, spring and fall call dates have been set on the
last day of March and September, respectively.




savings and loan associations in New England
began offering them in 1974.
Condition Reports of Foreign-Related
Banking Institutions.
Foreign-related institutions—agencies, branches, and domestic banking subsidiaries of foreign banks—have submitted monthly reports of condition as of the last
Wednesday, or last day of the month, since
November 1972. 55 Edge Act corporations also
submitted the reports monthly from November
1972 until March 1977, after which they submitted them quarterly.
Currently, these reports are the source of all
of the new components derived from foreignrelated institutions that enter into the calculation
of the proposed monetary aggregates. 5 6 The
following items are collected from condition
reports: in proposed M - l , demand deposits of
foreign official institutions and foreign banks
(subtracted from total demand deposits) and
M-l-type deposits of Edge Act corporations
outside New York; in proposed M-2, savings;
in proposed M-3, time deposits.
Many of the deposit liabilities of foreignrelated institutions were not large enough (that
is, they were less than $50 million) to be included in the monetary aggregates before 1972. 57

Mutual Savings

Banks

The basic data for deposits at mutual savings
banks come from the monthly Research
Analysis report published by the National Association of Mutual Savings Banks for deposits as
55
June and D e c e m b e r reports have always been as
of the last day of the month. Since March 1976, the
March and September reports have also been as of the
last day of the month. All other reports are as of the
last W e d n e s d a y of the month. Daily M - l - t y p e deposits
at these institutions have been available for several years
and are included in both the current and the proposed
aggregates.
56
Edge Act corporations engaged in banking submit
a daily deposit report to the Federal Reserve w e e k l y .
Other foreign-related institutions report M - l - t y p e deposits daily by telephone.
57
Until 1972, deposits of branches of foreign banks
in N e w York, which formed the major portion of deposit
liabilities of foreign-related institutions, were included
in the monetary aggregates on the same basis as those
of other nonmember banks; after 1972, they were estimated separately. Other deposit liabilities for which
pre-1972 data were estimated are discussed in the description of back data cited in note 5 2 above.

Redefining

of month-end, based on a sample of about 340
mutual savings banks accounting for 85 percent
of total time and savings deposits of these institutions. In June and December, data are collected by the N A M S B from all institutions and
are used to benchmark the series. Currently,
" s a v i n g s , " " t i m e , " and " o t h e r " deposits are
reported separately on the monthly report. 5 8 Savings deposits included in the proposed M-2 are
derived from this report. Deposits included in
the time deposit components of the proposed
M-3 are the sum of time deposits from the
monthly report, and school and club accounts;
the latter are currently available from a quarterly
survey of deposit ownership at all mutual savings banks, conducted by the FDIC. 5 9 That
quarterly survey is also the current source of
data on demand deposits at all mutual savings
banks. Before June 1975, when the survey
began, demand deposits were estimated from
semi-annual call reports.
NOW accounts of mutual savings banks in
New England are reported as of month-end, as
mentioned above, to the Federal Reserve Bank
of Boston, and weekly to the Federal Reserve
Bank of New York by a sample of mutual
savings banks in New York State.

Savings

and Loan

Associations

Deposits at savings and loan associations are
estimated from two monthly reports published
by the Federal Home Loan Bank Board. The
monthly News contains balance sheet data based
on month-end reports submitted by all insured
savings and loans associations, accounting for
98 percent of all savings and loan deposits.
Since July 1968, it has separated total deposits
into those paying the regular rate or less and
those paying more than the regular rate; the
former are assumed to be savings deposits, the
latter, time deposits. The second report, the
monthly Selected Balance Sheet Data,
All
Operating Savings
and Loan
Associations,
58
" O t h e r " deposits include demand deposits, school
and club accounts, non-interest-bearing N O W s , and
other accounts.
59
The estimation of savings and time deposits before
1971, and of club and school accounts before 1975,
is discussed in the description of data cited in note 5 2
above.




the Monetary

Aggregates

39

gives estimated total deposit data as of monthend for all operating savings knd loan associations, based on the monthly reports of the insured associations and annual reports of all
associations. For the purpose of allocating total
deposits between proposed M-2 and M-3, deposits at all associations have been allocated
between savings and time deposits using the
appropriate proportions for insured associations.
The estimation of deposits at savings and loan
associations before July 1968 is discussed in the
description of back data cited in note 52 above.
NOW accounts of savings and loan associations in New England, as mentioned above, are
reported as of month-end to the Federal Reserve
Bank of Boston.

Credit

Unions

Credit union share deposits as of month-end are
available in the Monthly Statistical Release issued by the National Credit Union Administration (NCUA) showing major asset and liability
items of credit unions. This release is based on
monthly reports from 1,200 relatively large
credit unions (60 percent of which are federal,
and the remainder of which are state credit
unions) accounting for 30 percent of total credit
union assets, plus annual data submitted by all
credit unions. The NCUA also publishes two
annual reports—one for federal credit unions,
the other for state-chartered credit unions.
Summaries of the annual year-end balance
sheets published in these reports include, for
most credit unions, balances held with other
credit unions. These balances are deducted from
total savings of credit unions to avoid double
counting. 6 0
Data on share draft accounts at credit unions
are available from the NCUA for federally
chartered credit unions only. Share draft accounts were first authorized for federally chartered institutions in November 1974. End-ofmonth data were reported by credit unions offering share draft accounts from May 1975 to
September 1976. After September 1976 only
end-of-quarter data are available.
60
The estimation of balances of credit unions with
other credit unions in earlier years is discussed in the
description of back data cited in note 52.

40

Federal Reserve Bulletin • January 1979

Repurchase

Agreements

Security repurchase agreements (RPs) with the
nonbank public—a major nondeposit liability of
commercial banks—have not been included in
the proposed M-3 measure on the grounds that
available data are incomplete and any RP estimates are likely to contain significantly more
estimation error than the deposit components
do. Nevertheless, it is believed that RPs have
come to play an important role in the monetary
system and an historical RP series has been
constructed using available information. To
create a monthly series for security repurchase
agreements of all commercial banks with the
nonbank public extending back to November
1969, monthly RP borrowings of 46 large
banks, based on daily averages and net of interbank borrowing, were benchmarked to adjusted
call report data. Monthly RP data for the 46
banks go back to November 1969.
Since the call report combines federal funds
and RP borrowings from both bank and nonbank
sources, the procedure for benchmarking first
involved the removal of interbank federal funds
and RP borrowings. Beginning in 1976, interbank federal funds and RP borrowings have
been available directly from the call report.
However, to obtain interbank federal funds and
RP borrowings for earlier periods, it was necessary to construct estimates. 6 1 The next step in
benchmarking involved the removal of federal
funds borrowed from sources other than commercial banks; this was done using federal funds
lent by the principal institutions placing federal
funds with banks. 6 2 The resulting series, estimated RP borrowings by all banks net of interbank borrowings, was then divided by RP bor61
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
average relation b e t w e e n these two series for the ten
call reports ending with June 1978. (Interbank borrowing and interbank lending are not identical because the
call report instructions define banks for the purposes
of the borrowing item to include several financial institutions other than commercial banks.)
62
Federal funds lending by mutual savings banks,
savings and loans, and the Federal H o m e Loan Bank
S y s t e m are available over much of the period for which
the benchmarks are needed. These data, h o w e v e r , include all federal funds lending, whereas the federal
funds borrowing listed by banks on the call report




rowings of the 46 banks as of the call dates
to obtain blowup factors that were applied to
the monthly RP borrowings of the 46 RP reporters. These factors are semi-annual until
1972 and quarterly thereafter.
CONSOLIDATION

OF

INTERINSTITUTION

DEPOSITS

Insofar as was possible, components of the
proposed monetary aggregates were consolidated
rather than combined, in line with the recommendations of the Advisory Committee on
Monetary Statistics. 63
The committee recommended that in constructing the monetary aggregates, accounts of
financial institutions should be consolidated
rather than combined. Furthermore, the committee recommended that in each monetary aggregate only those interinstitution deposits
should be removed by consolidation that are
held for servicing other deposits included in that
aggregate. For example, mutual savings banks
hold demand deposits with commercial banks;
the committee recommended that the portion of
these deposits that is held for servicing the
demand deposit liabilities of mutual savings
banks be excluded from M - l because the demand deposit liabilities of mutual savings banks
are included in the proposed M-1, and to include
that portion would be to double count. However, demand deposits that mutual savings
banks hold at commercial banks on account of
their savings deposit liabilities should not be
excluded from M - l , but should be removed
from proposed M-2. Similarly, demand deposits
held on account of time deposit liabilities should
be removed from proposed M-3. Since it is not
possible to determine what portion of these

includes only one-day and continuing-contract federal
funds. The remaining "term" federal funds borrowing
constituted about 25 percent of all federal funds borrowing as of April 1974 and D e c e m b e r 1977. Accordingly, the data on federal funds lending are multiplied
by three-fourths before being subtracted from the call
data on federal funds and repurchase agreements. The
data for federal funds lending by mutual savings banks
begins in D e c e m b e r 1971; for savings and loans, in
March 1974; and for the Federal H o m e Loan Bank
S y s t e m , in June 1974.
H3
Improving
the Monetary
Aggregates:
Report, pp.
12-14.

41

A3. Series not consolidated in the construction of the proposed monetary aggregates
Estimated size
Millions
of dollars

A g g r e g a t e , type of d e p o s i t , and holder
M-2
S a v i n g s held at c o m m e r c i a l b a n k s
Credit u n i o n s
Mutual savings banks
S a v i n g s and loan a s s o c i a t i o n s
S a v i n g s held at thrift institutions
Mutual savings banks
S a v i n g s and loan a s s o c i a t i o n s

97
1
n.a.

M-3
T i m e d e p o s i t s held at c o m m e r c i a l b a n k s
Credit u n i o n s
S a v i n g s and loan a s s o c i a t i o n s
T i m e d e p o s i t s at thrift institutions
Credit u n i o n s
M u t u a l savings b a n k s
S a v i n g s and loan associations
M-2 and M-3 consolidation
component
D e m a n d d e p o s i t s held at c o m m e r c i a l b a n k s
S a v i n g s and loan associations
Credit u n i o n s
a

T h e s e d a t a were available until M a r c h

Infrequency
Smallness
Unavailability

1977

Unavailability
Unavailability' 1

707
6,019

December
March

1976
1978

Infrequency
Infrequency

1,383
n.a.
465

December

1976

March

1978

Infrequency
Unavailability
Infrequency

700
700

March
December

1978
1976

Infrequency
Infrequency

n . a . Not a v a i l a b l e .

The only thrift institution deposit holdings for
which data are adequate for consolidation purposes are deposits of mutual savings banks at
commercial banks (both demand and time), and
savings of credit unions at other credit unions.
Because of the lack of adequate data, other
components that these principles suggest should
be removed by consolidation were not removed.
Table A3 shows the estimated size of interinstitution-consolidation components. In most cases,
data are available only semi-annually or annually. Most components are too large and
variable to be included on the basis of such
infrequent observations. For other components,
data are not available at all.




D e c e m b e r 1976
J u n e 1978

March

1977.

Because demand deposits are such a small
tion of the total deposit liabilities of mutual
banks, no adjustment was made for demand
held by mutual savings banks to service their
deposit liabilities.

R e a s o n for not c o n s o l i d a t i n g

n.a.
89

demand deposits are held to back each type of
deposit liability at mutual savings banks, as an
approximation the proportion of each type of
deposit liability—demand, savings, or time—to
total deposit liabilities was used. 6 4 For example,
in June 1978, the ratio of savings deposits to
total deposits at mutual savings banks was approximately 57 percent; it was estimated that
this proportion of mutual savings banks' demand deposits at commercial banks was held
to back savings deposits, and they were removed f r o m proposed M-2; the balance was
removed from proposed M-3.

<i4

Date
of estimate

proporsavings
deposits
demand

The effect of combining rather than consolidating certain accounts is to raise the measured
levels of proposed M-2 and M - 3 f r o m their true
levels. The effect on M-l is negligible. Table
A3 suggests that the size of the components that
should be removed by consolidation f r o m proposed M-2 and M-3, but are not removed because the data are lacking, is not negligible.
Because data are not available for many components, the only reliable conclusion from table
A3 is that the size of the components that should
be consolidated out of proposed M-2 and M-3
is not negligible.

SEASONAL

ADJUSTMENT

Components of the proposed aggregates were
seasonally adjusted using standard options in the
Census X - l 1 program. The seasonal adjustment
routine was applied to the proposed aggregates
as follows:
The currency and the demand deposit components (covering commercial and mutual savings banks, and foreign-related institutions) of
the proposed M-1 were each seasonally adjusted
separately. Newly introduced checkable deposi t s — N O W accounts and share draft accounts at
credit unions—were not seasonally adjusted.
These latter series are of such recent origin that
there are not yet enough observations to establish a seasonal pattern. The commercial bank
savings deposit component
was adjusted
separately and added to the seasonally adjusted

42

Federal Reserve Bulletin • January 1979

M - l to construct M-1 + . The savings of all
depositary institutions, taken as a whole, were
seasonally adjusted and added to M - l to construct M-2. Similarly, time deposits for all institutions, taken as a whole, were seasonally
adjusted and added to M-2 to construct M-3.
The seasonal adjustments presented here
should be regarded as preliminary. For the current monetary aggregates, seasonal adjustment
involves examination of alternative adjustments
made by selecting different options available in
the X - l l program, as well as judgmental




adjustment of the output of X - l l , in order to
take account of the effects of policy changes
and other factors in seasonal patterns that are
not fully captured by X - l l . Thus far no such
examination has been made for the proposed
aggregates, nor has the X - l l output undergone
judgmental review. In addition, seasonal adjustment of some disaggregated components,
such as savings deposits at savings and loan
associations and at mutual savings banks,
should be reviewed before a final seasonally
adjusted series is available.
•

43

Industrial Production
Released

for publication

January

17

Industrial production in December increased an
estimated 0.6 percent, the same as the revised
change for November. Production gains in December were widespread among most major
product and material groupings, with output of
automotive products the major exception. Large
increases occurred in production of home goods,
business and defense equipment, construction
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
commercial and transit equipment, and was

Total

''Preliminary.




F . R . indexes, seasonally adjusted. Latest
Auto sales and stocks include imports.

1967 = 100

Percentage change from preceding month to—

1978

1978

Industrial production

Products, total
Final products
Consumer goods
Durable
Nondurable
Business equipment
Intermediate products
Construction supplies
Materials

nearly 10 percent above that of a year earlier.
Production of durable goods materials increased sharply again in December, reflecting
continued strength in basic metals and in parts
for equipment and consumer durable goods;
output of these materials was more than 12
percent above a year earlier. Output of nondurable goods materials increased slightly. Production of energy materials rose moderately as
coal production continued to increase sharply.

Nov."

Dec.'

July

149.5

150.4

.8

.7

.5

147.8
144.8
149.8
162.6
144.8
167.9
159.2
157.7
152.2

148.8
145.6
150.5
162.8
145.5
169.3
160.5
159.1
152.9

.7
.8
.5
.2
.6
1.2
.6
.9
1.0

.8
.8
.5
.4
.5
1.0
.5
.8
.5

.2
.3
.4
-.7
.9
.2
.4
.6
.7

''Estimated.

Aug.

Sept.

figures:

December.

Nov.

Dec.

Percentage
change
12/77
to
12/78

.5

.6

.6

7.7

.2
.1
.1
1.1
-.3
.7
.7
6
1.1

.7
.6
.5
.4
.6
.6
.7
.7
.6

.7
.6
.5
.1
.5
.8
.8
.9
.5

6.1
5.8
3.2
4.5
2.6
9.9
6.7
7.3
10.2

Oct.

NOTE.—Indexes are seasonally adjusted.

45

Announcements
EARNINGS

OF FEDERAL RESERVE

BANKS

Preliminary figures indicate that gross current
e a r n i n g s of the F e d e r a l R e s e r v e B a n k s
amounted to $8,455 million during 1978, a 22.7
percent increase from a year earlier. Current
expenses for the 12 Reserve Banks and their
branches totaled $653 million—4.6 percent
above a year earlier—leaving current net earnings of $7,803 million.
Net earnings before payments to the Treasury
totaled $7,116 million. Payments to the Treasury as interest on Federal Reserve notes
amounted to $7,006 million; statutory dividends
to member banks, $63 million; and additions
to Reserve Bank surplus, $47 million.
Under the policy adopted by the Board of
Governors at the end of 1964, all net earnings
after the statutory dividend to member banks
and additions to surplus to bring it to the level
of paid-in capital were paid to the U.S. Treasury
as interest on Federal Reserve notes.
Compared with 1977, gross earnings were up
$1,564 million due to an increase of $1,546
million on U.S. government securities.
Assessment for expenditures of the Board of
Governors amounted to $53 million. There was
a $633 million net deduction in the profit and
loss account, primarily because of a net loss
of $130 million on sales of U.S. government
securities and $506 million on foreign exchange
operations.
The $506 million loss on foreign exchange
operations includes realized losses of $297 million and unrealized losses of $209 million resulting from the revaluation of foreign exchange
holdings and outstanding commitments at current exchange rates. Of these amounts, $268
million and $150 million, respectively, reflect
losses associated with Swiss franc commitments
entered into before August 15, 1971. The total
unrealized net loss was calculated by using




market exchange rates of December 29, 1978,
to value the System's foreign currency holdings
and foreign currency commitments; liquidation
or payment may actually take place at exchange
rates that differ from these rates.
Earnings of the Federal Reserve System are
derived primarily from U.S. government securities that the Federal Reserve has acquired
through open market operations, one of the tools
of monetary policy.
DEFAULT

ON

GENERAL

OBLIGATION

In light of
securities
following
18, 1978,
agencies. 1

MUNICIPAL
SECURITIES

the default on payment of
by the city of Cleveland,
statement was issued on
by the three federal bank

municipal
Ohio, the
December
regulatory

It is not possible to anticipate the extent
to which a default on a municipal general
obligation may affect the ultimate payment
of such an obligation, due to the fact that
such obligations are backed by the full faith
and credit of an issuing state, city, or other
political subdivision that has general taxing
authority. In view of these uncertainties, the
bank regulators recently reviewed the bank
examination procedures that apply to defaulted securities and decided to allow for
a market stabilization period in order that
a more accurate estimate of the value of the
securities may be made.
Under the new procedures applying to
defaulted municipal general obligation securities, a period of time will be provided
to permit the market for these defaulted
1
The Comptroller of the Currency (supervisor of
national banks); the Federal Deposit Insurance Corporation (supervisor of state-chartered banks that are not
members of the Federal Reserve S y s t e m ) ; and the Board
of Governors (supervisor of state-chartered member
banks).

46

Federal Reserve Bulletin • January 1979

securities to stabilize or for the issuer to put
in place budgetary, tax, or other actions that
may eliminate the default, or otherwise improve the post-default market value of the
securities.
The Federal Reserve Board, the Comptroller of the Currency, and the Federal
Deposit Insurance Corporation have agreed
on the following treatment by bank examiners of defaulted state or local general obligations held by banks:
1. After a default has occurred, holdings
of the defaulted issue will be listed in examination reports for appropriate treatment.
2. Depreciation in the defaulted municipal general obligation will not be classified
as a loss for the purposes of a bank examination while a market is in the process of
being reestablished for the defaulted security
or other steps are being taken that will improve the quality of the security.
3. Adjustments to a bank's capital position will be required when reasonable estimates of value can be determined.
4. The default of a general obligation of
a municipal issuer will not be viewed by the
supervisory authorities as an overriding factor in the appraisal of other obligations of
the same issuer, nor will it preclude the
purchase by banks of other obligations of
the same issuer.
The above procedures represent interim adjustments by federal banking agencies in a
Uniform Agreement (written in 1938) on the
treatment of investment securities held by
banks. That agreement, currently being studied
for appropriate revision, provides that examiners would classify immediately as a loss the
net market depreciation of securities in default.

REGULATION

Y:

AMENDMENT

The Board of Governors has adopted amendments to its Regulation Y (Bank Holding Companies) concerning publication by bank holding
companies of their intention to engage in nonbank activities and procedures in commencing
nonbank activities abroad.
One of the two amendments, which do not
apply to banking activities, permits notice of
intention by bank holding companies to engage




in nonbank activities, in the United States or
abroad, to be published in the Federal
Register.
When such a proposal concerns de novo nonbank activities the bank holding company must
file with the appropriate Reserve Bank a statement of the geographic scope of the proposed
activity. This geographic area may not be enlarged without a further application.
In proposing this regulatory amendment in
July the board said that several years' experience with the existing requirement for publication in local newspapers indicated such notices
imposed a burden on bank holding companies
without accomplishing their intended purpose of
allowing parties an opportunity to comment.
In a further action the board added language
to Regulation Y that would permit bank holding
companies and their subsidiaries to conduct
abroad previously approved nonbanking activities 45 days after informing the appropriate
Reserve Bank. This applies only to domestic
bank holding companies and domestic nonbank
subsidiaries and clarifies and formalizes procedures already in use. The board proposed this
action in April.
The board's action concerning publication is
effective with applications filed after the end of
1978. Applications filed before that time will
be processed under previous rules.
REGULATION Z:

GUIDELINES

Uniform guidelines for the enforcement of the
Truth in Lending law and its implementing
regulations have been adopted by the five federal
agencies that regulate federally insured commercial banks, mutual savings banks, savings
and loan associations, and credit unions. 2
The agencies adopted the enforcement guidelines after consideration of some 300 comments
received following publication of proposed
2
The Comptroller of the Currency (supervisor of
national banks); the Federal Deposit Insurance Corporation (supervisor of federally insured, state-chartered
nonmember banks and mutual savings banks); the Board
of
Governors
(supervisor
of
federally
insured,
state-chartered member banks); the Federal H o m e Loan
Bank Board (supervisor of federally insured savings and
loan associations); and the National Credit Union Administration (supervisor of federally insured credit
unions).

Announcements

guidelines last year. The guidelines call for
reimbursement to individuals for overcharges of
$1 or more, or for smaller overcharges that are
part of a consistent pattern of violation or result
from gross negligence or willful violations of
the act.
In adopting the guidelines for the enforcement
of the requirements of the Truth in Lending Act
for disclosure of the true costs of using credit,
the five agencies said:
Coordination among the agencies is desirable in order to bring about uniformity in the
administrative actions that will be taken
when violations of the Act are detected. To
that end, the agencies have developed a set
of policy guidelines for measuring and correcting the conditions resulting from certain
violations of the Truth in Lending Act.
The guidelines . . . are intended to address
those violations which result in overcharges
to customers.
It should be emphasized that it will continue
to be the policy of the enforcing agencies
that, whenever any violation of the Act is
detected, prospective correction of the violation will be required—that is, creditors
will be required to take whatever action is
necessary to ensure that violations do not
recur.
These guidelines are not intended to substitute for any other administrative authority
that any of the agencies has to enforce the
Act, nor do they foreclose the customer's
right to bring a civil action where authorized
by the Act. Further, where apparently willful
and knowing violations are found, the agencies will notify the Department of Justice.
As new examination data concerning the
extent and type of violations are received,
the guidelines will be reviewed and revised
as appropriate. They may be modified at the
discretion of the agencies so as to be more
responsive to specific or unique circumstances that may exist.
The Truth in Lending Act was written in
1968. At the direction of the Congress the
Federal Reserve Board wrote implementing
rules—Regulation Z — f o r the use of creditors,
consumers, and federal regulators of creditors.
The rules of application for the guidelines
state the following:




47

The guidelines, viewed by the agencies as
minimum standards for enforcement, apply
specifically to violations in other than open-end
transactions. Violations of disclosure requirements in open-end transactions (such as use of
a credit card) will be treated on a case by case
basis, but subject to the same general treatment
as provided by the guidelines. Where violations
are discovered in loans purchased by one institution f r o m another, the enforcing agency for
the holder of the loan must notify the supervisor
of the institution that originated the credit.
Each enforcing agency retains authority to
take appropriate alternative action consistent
with the guidelines. The five-agency statement
of policy does not preclude enforcement of
provisions of the act not covered by the guidelines.
The full text of the Joint Notice of Statement
of Enforcement Policy for Regulation Z , including the guidelines, may be obtained upon
request to the five regulatory agencies.
CONSUMER ADVISORY

COUNCIL

The Federal Reserve has named a new chairman
and vice chairman and appointed eight new
members to its Consumer Advisory Council.
William D. Warren, Dean of the School of
Law of the University of California at Los
Angeles, who had previously served as vice
chairman, was named chairman of the council.
He replaces Mrs. Leonor K. Sullivan, St. Louis,
Missouri, a former member of the Congress,
whose term on the council expired. Mrs. Sullivan, who has served as chairman since the
council was created two years ago, was named
to the honorary post of chairman emeritus for
a two-year period.
Marcia A. Hakala, Assistant to the Dean of
the School of Fine Arts of the University of
Nebraska at O m a h a , was appointed vice chairman. Mrs. Hakala has served as a member of
the council since 1977.
The Board also named the following persons
to replace members whose terms have expired:
James L. Brown, Milwaukee, Wisconsin,
is director of the University of Wisconsin
Extension Center for Consumer Affairs. He
was a staff attorney with the Milwaukee

48

Federal Reserve Bulletin • January 1979

Legal Services before joining the Center and
has served as Chairman of the Legislative
Committee of the Wisconsin Consumers
League since 1976. He has served as a
consultant on electronic fund transfer systems for various organizations, including the
House and Senate Banking Committees, and
has helped draft revisions and amendments
to the Wisconsin Consumer Act.
Mark E. Budnitz, Newton, Massachusetts, is the executive director of the National Consumer Law Center, in Boston,
Massachusetts. He formerly was a supervising attorney for the Civil Clinical Program
of Boston University Law School and a staff
attorney for Greater Boston Legal Services.
He has specialized in consumer law and
electronic fund transfer systems.
Harvey M., Kuhnley, Edina, Minnesota,
is the chief executive officer of Twin City
Federal Savings and Loan Association, the
largest S&L in the Upper Midwest. He was
formerly executive vice president and secretary and chairman of the association's loan
committee. Before becoming president and
chief executive officer, Mr. Kuhnley spent
28 years at Twin City Federal gaining experience in all phases of the savings and loan
business. He has been active in Minneapolis
civic affairs and in state and national trade
associations for the savings and loan industry.
Florence M. Rice, New York, New York,
is co-founder and president of the Harlem
Consumer Education Council and the National Black Consumers. She is one of the
early leaders of the consumer movement and
has been active, as a volunteer, in a range
of consumer advocacy issues, including
most recently, electronic fund transfer systems. She has held a number of state, national, and international positions, including
that of official member to the U.S. Delegation to the World Congress of the International Women's Year at Berlin in 1975; and
representative to the U.N. Congress of
Non-Governmental Organizations in 1976.
She teaches consumer education at Malcolm
King College in New York City and hosts
a weekly public affairs radio program.
Ralph J. Rohner, Washington, D.C., is
a Professor at the Catholic University Law




School in Washington, D.C. He has written
numerous articles on federal consumer
credit legislation and has served as Counsel
to the Senate Banking Committee's Consumer Affairs Subcommittee. He has also
acted as a consultant to several federal bank
regulatory agencies, including the Federal
Reserve Board, where he helped develop
legislative proposals for simplifying the
Truth in Lending Act. Mr. Rohner is also
co-author of a consumer law casebook and
a member of the American Bar Committee
on the Regulation of Consumer Credit.
Henry S. Schechter, Washington, D.C.,
is Director of the Department of Urban Affairs of the AFL-CIO and has extensive
experience in housing, urban development,
mortgage finance, and other financial matters
affecting consumers. Before joining the
AFL-CIO, he was the Senior Specialist in
Housing with the Congressional Research
Service of the Library of Congress and,
before that, Director of the Office of Economic and Market Analysis of the Department of Housing and Urban Development.
He also held positions with the Housing and
Home Finance Agency, the Veterans Administration, Department of Commerce,
War Production Board, and the U.S. Housing Authority.
Richard A. Van Winkle, Salt Lake City,
Utah, is President and a Director of Lockhart
Finance Company, a financial holding company, and has been active in consumer finance and banking for many years. He was
President of the former American Industrial
Bankers Association. This association
merged with the National Consumer Finance
Association, and Mr. Van Winkle later
served as President of NCFA for two years.
He is also the Executive Vice President and
Director of Zions Utah Bancorporation, a
bank holding company. He has directed a
number of civic and charitable organizations
in Salt Lake City.
Mary W. Walker, Monroe, Georgia, is
the President of the National Bank of Walton
County, in Monroe, Georgia. She has been
with the bank since 1951 and has worked
in every department. She has participated in
consumer conferences through the local

Announcements

Chamber of Commerce. She also served as
Chairman of the Advisory Board for the
Walton County Retardation Center. Mrs.
Walker has been a member of the Government Relations Council of the American
Bankers Association and a member of the
executive committee of several committees
of divisions of the ABA.
The council advises on the board's responsibilities in the field of consumer credit protection laws. Beginning with the Truth in Lending
Act of 1968, the Congress has directed the board
to write regulations to give effect to many of
the consumer credit laws. The Consumer Advisory Council was established by the Congress,
at the suggestion of the board, in 1976. Its
members come f r o m all parts of the nation and
include a broad representation of consumer and
creditor interests. It meets quarterly with the
board.

DIVESTITURE PLANS OF BANK
HOLDING

COMPANIES

The Board of Governors has informed bank
holding companies that they should file by September 30, 1979, divestiture plans required by
the Bank Holding Company Act to be effective
by the end of 1980, in order to avoid facing
significant prospects of forced sales to meet the
statutory deadline.
The Bank Holding C o m p a n y Act amendments of 1970 provided that companies that
became bank holding companies by virtue of
the 1970 amendments (that is, one-bank holding
companies) and that had acquired nonbank activities between June 30, 1968, and December
30, 1970, had until December 31, 1980, to (1)
divest such nonbank activities or (2) get board
approval to keep them. Alternatively, they could
cease to be a bank holding company by divesting their bank holdings by the end of 1980.
There is no provision in the act for extending
the December 31, 1980, deadline. The board
has consequently established September 30,
1979, as the date by which divestiture or retention plans should be filed to comply with the
act's deadline.
A suggested draft letter to the Reserve Banks




49

to be sent to heads of the affected bank holding
companies said, in part:
In view of the large number of divestiture
plans and retention applications yet to be
filed (some 314 companies with over 400
subsidiaries), the board, in order to assure
that compliance with the Act will be carried
out in an orderly manner, has established
September 30, 1979, as the date by which
divestiture plans or retention applications
should be filed with this Reserve Bank.
Failure to comply will significantly increase
the prospects that these activities will become candidates for forced sales because of
the lack of sufficient time prior to the nonextendible statutory deadline of December
31, 1980, in which to process tardy filings.
In October 1977 the board had suggested a
voluntary filing date of June 30, 1978. In February 1977 the board had issued a general policy
statement on divestitures that urged early action
on the divestitures required by the end of 1980.
The board's letter pointed out that although
the holding companies are legally entitled to
continue their affected nonbank activities until
the 1980 deadline, many uncertainties may
cause delay and prevent timely processing of
late-filed plans or applications, even though the
Federal Reserve will make every effort to
process them expeditiously.
The divestiture deadline does not apply to
nonbanking activities permanently grandfathered under the 1970 amendments. These are
subsidiaries that were held by bank holding
companies on June 30, 1968, and have been
held continuously since.
PROPOSED

ACTIONS

The Board of Governors has requested comment
by January 29, 1979, on an initial set of proposed regulations for consumer protection under
the Electronic Fund Transfer Act. The act,
which became law in November 1978, directs
the board to issue implementing regulations and
model disclosure clauses. The rules proposed
by the board would carry out sections of the
act that become effective February 8, 1979.
Proposed regulations for other sections of the

50

Federal Reserve Bulletin • January 1979

act that go into effect in May 1980 will be issued
later.
The board on January 2, 1979, invited public
comment on a wide range of questions bearing
on disclosure to borrowers of the annual percentage rate (APR) required by the truth in
lending law and its implementing Regulation Z.
The APR expresses the cost to the consumer
of borrowing money and paying for purchases
on credit. The board requested comment by
March 5, 1979.
The board on December 28, 1978, proposed
regulatory rules to implement new legislation
to tighten restraints on lending by member banks
to insiders. At the same time, the board proposed simplification of Regulation O (Loans to
Executive Officers of Member Banks), which
would be amended by the proposals. The board
requested comment on the proposals by January
29, 1979.
The Federal Reserve Board has made public
a summary of the issues involved in a proposal
by the New York Clearing House Association
to establish an international banking facility
(IBF) in New York City. The proposal seeks
an exemption f r o m reserve requirements and
interest rate ceilings for funds maintained with
the IBF. The board invited comment by March
15, 1979.

NEW

CONSUMER

4

PUBLICATION

A 'Consumer Handbook to Credit Protection
L a w s , " the latest in a series of consumer education publications, is now available for distribution.
The handbook explains consumer rights under
the major credit protection laws and how borrowers can use them to shop for credit, apply
for it, keep up credit standings, and complain
about possible abuses. It also points out the
laws' solutions to credit practices that have been
used in the past to discriminate against women
and minorities.
Copies of the " C o n s u m e r Handbook to Credit
Protection L a w s " may be obtained singly or in
bulk free of charge f r o m the Board of Governors
in Washington or f r o m any of the 12 Federal
Reserve Banks.




SYSTEM

MEMBERSHIP:

ADMISSION

OF STATE

BANK

The following bank was admitted to membership in the Federal Reserve System during the
period December 16, 1978, through January 15,
1979:
Colorado
Westcliffe

NEW

BOARD

Custer County Bank

PUBLICATION

The 1977 Consumer
Credit Survey is now
available for distribution. This study presents
the first comprehensive analysis of information
obtained in a nationwide survey of nearly 2 , 6 0 0
households conducted under contract by the
Survey Research Center, Institute for Social
Research, University of Michigan, in August
and September 1977. The Federal Deposit Insurance Corporation and the Office of the
Comptroller of the Currency joined the Federal
Reserve Board of Governors in sponsoring the
fieldwork.
The Survey, by Professor Thomas A. Durkin
of Pennsylvania State University with the assistance of Gregory E. Elliehausen, tabulates
consumers' knowledge of credit laws and use
of credit. It first examines survey questions and
findings about consumer awareness, understanding, attitudes, and behavior regarding
credit and its regulation, with particular attention to the Truth in Lending Act, unfair practices
and complaints, the Equal Credit Opportunity
Act, the Fair Credit Billing Act, credit insurance, and consumer attitudes toward credit and
creditors. The publication also provides information about credit use and credit users; reviews
patterns of consumers' debts, income, and
assets; and updates many tables f r o m earlier
Surveys of Consumer Finances undertaken by
the Survey Research Center.
Copies of the Survey may be obtained f r o m
Publications Services, Division of Support
Services, Board of Governors of the Federal
Reserve System, Washington, D . C . 20551. The
price is $2.00 per copy.

51

Record of Policy Actions
of the Federal Open Market Committee




MEETING HELD ON N O V E M B E R 21, 1978
1. D o m e s t i c P o l i c y D i r e c t i v e
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 f r o m 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 u n e m p l o y m e n t rate was expected to increase slightly f r o m its
October level.
In October the index of industrial production rose an estimated
0 . 5 per cent, the same as in September but s o m e w h a t below the
average advance since last winter. N o n f a r m payroll e m p l o y m e n t
rose considerably in October following relatively small advances
during the third quarter. In manufacturing, e m p l o y m e n t gains were
the largest of the year and the average w o r k w e e k edged up. The
unemployment rate declined f r o m 6 . 0 to 5 . 8 per cent.
Total private housing starts remained above an annual rate of
2 million units in September. H o w e v e r , sales of new units declined
for the fourth consecutive m o n t h , 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

52

Federal Reserve Bulletin • January 1979




October following a sizable gain in August and a further advance
in September. O n 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 n o n f a r m 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 n o n f a r m
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 m o n t h , reflecting in part a
further large increase in producer prices of f o o d 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 G o v e r n m e n t announced a new program aimed
at moderating increases in prices and wages. The program included
explicit numerical standards for price and w a g e increases, with
voluntary compliance encouraged by a number of G o v e r n m e n t
measures; procedures to minimize the inflationary impact of Government regulations; and a restrictive budget policy.
O n N o v e m b e r 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 p r o g r a m the Federal Reserve announced the following actions:
an increase in the discount rate f r o m 8V2 to 9V2 per cent; establishment of a supplementary reserve requirement of 2 per cent against
m e m b e r bank time deposits in denominations of $ 1 0 0 , 0 0 0 or more;
and increases in its reciprocal currency arrangements with the
central banks of G e r m a n y , Japan, and Switzerland, and activation
of the swap arrangement with the Bank of Japan. T h e U . S . Treasury
announced related measures to mobilize key foreign currencies,
including drawings on the U . S . reserve tranche in the International
Monetary F u n d ; 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




Record

of Policy Actions

of the

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 m o v e m e n t s .
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 N o v e m b e r 1, h o w e v e r , 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 f r o m the second quarter.
In October the expansion of total credit at U . S . commercial banks
slowed slightly f r o m 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 m o n e y 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 s o m e w h a t , although sales of 6-month m o n e y 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 f u n d s rate of around 9 per cent, slightly
above the rate of 834 per cent then prevailing. Subsequently, the
objective for the Federal f u n d s 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 f u n d s rate within that range,
the Manager of the System O p e n 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 O c t o b e r - N o v e m b e r 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

FOMC

53

54

Federal Reserve Bulletin • January 1979




Federal f u n d s rate of around 9 per cent. H o w e v e r , because a sizable
short-term need for reserves coincided with temporary market
scarcities of Treasury obligations for collateral behind System
repurchase agreements, Federal f u n d s traded at around 9 l A per cent.
As October progressed, the Manager did not take aggressive action
to exert d o w n w a r d pressure on the f u n d s rate, in light of conditions
in foreign exchange markets and of the C o m m i t t e e ' s related instruction to give due regard to such developments. Accordingly,
Federal f u n d s continued to trade at around 9*4 per cent in the days
prior to N o v e m b e r 1.
As part of the G o v e r n m e n t program announced on N o v e m b e r
1, the Committee had voted on October 31 to delegate authority
to Chairman Miller to m o d i f y the domestic policy directive by
raising the range for the Federal f u n d s rate to 9V2 to 9% per cent
and by instructing the M a n a g e r , 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 N o v e m b e r 1. During the first half
of N o v e m b e r , the Federal f u n d s rate averaged in the upper half
of that range. For several days immediately following the November 1 a n n o u n c e m e n t , h o w e v e r , 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 f u n d s 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, h o w e v e r , by large investments by foreign central banks
of dollars obtained in currency support operations. C o m m e r c i a l
banks increased the rate on loans to prime business borrowers f r o m
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
N o v e m b e r . In mortgage markets, interest rates m o v e d steadily
higher over the inter-meeting period as d e m a n d s for real estate
credit remained strong. Residential mortgage lending apparently
increased in October.
In the C o m m i t t e e ' s discussion of the e c o n o m i c situation and
outlook, most m e m b e r s indicated that over the past month they

Record

of Policy Actions

of the

had scaled d o w n their expected rates of growth in real output of
goods and services for the year ending in the third quarter of 1979.
O n e or two m e m b e r s still anticipated moderate expansion over the
period, but m a n y 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 e m p h a s i z e d ,
h o w e v e r , that the uncertainties associated with any forecast of real
output had increased significantly.
Most m e m b e r s expected that, over the year ending in the third
quarter of 1979, the unemployment rate either would change little
or would increase f r o m the average level in the third quarter of
1978. All m e m b e r s 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. T h u s , 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.
S o m e skepticism was expressed, as it had been at the October
meeting, that growth in output could be tapered d o w n to a relatively
slow rate without bringing on a recession, especially in view of
the rapid inflation. It was stressed, on the other h a n d , that economic
conditions in this period differed f r o m those in other business
expansions in ways that m a d e 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.




FOMC

55

56

Federal Reserve Bulletin • January 1979




At its meeting in October the Committee had agreed that f r o m
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 f r o m demand to savings deposits resulting f r o m
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 m e m b e r s of the Committee agreed that, in seeking to achieve
bank reserve and m o n e y 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 N o v e m b e r
1 introduction of A T S . Against that background, the m e m b e r s
differed somewhat in their views as to whether, and to what degree,
additional firming in m o n e y market conditions should be sought
during the next few weeks; no sentiment was expressed for easing
m o n e y market conditions. As they had at the October meeting,
m o r e o v e r , most m e m b e r s favored giving greater weight than usual
to m o n e y 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.
T h e m e m b e r s favored directing open market operations early in
the period before the next regular meeting toward maintaining the
weekly-average Federal f u n d s rate at 93A per cent, the upper end
of the 9V2 to 93/4 per cent range specified as of N o v e m b e r 1, or
slightly higher. With respect to the range in which the f u n d s rate
might be varied if growth in the aggregates appeared to approach




Record

of Policy Actions

of the

or m o v e b e y o n d their specified limits, m o s t m e m b e r s f a v o r e d an
upper limit of 10 per cent for the r a n g e ; lOVs and 1 0 ^ per cent
w e r e also p r o p o s e d . L o w e r limits f r o m 9Vi to 93A per cent w e r e
suggested.
W i t h respect to the m o n e t a r y a g g r e g a t e s , a l m o s t all m e m b e r s
p r o p o s e d that the C o m m i t t e e take a c c o u n t of the u n u s u a l uncertainties associated with the introduction of A T S in the s a m e w a y
that it had at the O c t o b e r m e e t i n g — n a m e l y , by g i v i n g p r i m a r y
e m p h a s i s to g r o w t h of M - 2 and by s p e c i f y i n g only an u p p e r limit,
rather than a r a n g e , for g r o w t h of M - l . For the a n n u a l rate of
g r o w t h in M - 2 over the N o v e m b e r - D e c e m b e r p e r i o d , m o s t m e m bers f a v o r e d a range with a lower limit of 6 per cent and an upper
limit of 9 to 10 per cent. A l m o s t all m e m b e r s p r o p o s e d 5 or 5V2
per cent for the ceiling on g r o w t h of M - l over the 2 - m o n t h p e r i o d .
At the c o n c l u s i o n of the d i s c u s s i o n the C o m m i t t e e agreed to
instruct the M a n a g e r to seek a Federal f u n d s rate of a r o u n d 9 %
per cent early in the p e r i o d b e f o r e the next regular m e e t i n g and
s u b s e q u e n t l y to m a i n t a i n the rate within a n a r r o w b a n d of 9% to
10 per cent. W i t h regard to the specific o b j e c t i v e for the rate within
that r a n g e , the C o m m i t t e e instructed the M a n a g e r to be g u i d e d
m a i n l y by a r a n g e of tolerance for the a n n u a l rate of g r o w t h in
M - 2 over the N o v e m b e r - D e c e m b e r period of 6 to 9Vi per c e n t ,
p r o v i d e d that the rate of g r o w t h in M - l over that p e r i o d did not
e x c e e d 5 per cent. It w a s u n d e r s t o o d that the C h a i r m a n m i g h t call
u p o n the C o m m i t t e e to c o n s i d e r the need for s u p p l e m e n t a r y instructions b e f o r e the next s c h e d u l e d m e e t i n g if significant inconsistencies a p p e a r e d to be d e v e l o p i n g a m o n g the C o m m i t t e e ' s o b j e c tives.
T h e f o l l o w i n g d o m e s t i c policy directive w a s issued to the F e d e r a l
R e s e r v e B a n k of N e w Y o r k :
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

FOMC

57

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 9 l /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




Record of Policy Actions of the FOMC

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-

59

A 60

Federal Reserve Bulletin • January 1979




panded at a slow pace. For the N o v e m b e r - D e c e m b e r period, staff
projections suggested that the annual rates of growth in M - l and
M - 2 would be about lA per cent and 6 l A 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
w e e k s 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 9 3 A 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 2 1 , 1978, the Committee had reaffirmed
an agreement with the Treasury under which the Federal Reserve
would undertake to " w a r e h o u s e " 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

Record

of Policy

Actions

oftheFOMC

currencies, of w h i c h half w o u l d be for periods of up to 12 months
and half for periods of up to 6 months.
O n D e c e m b e r 14, 1 9 7 8 , the C o m m i t t e e amended paragraph 1A
of the authorization for foreign currency operations to provide for
transactions in foreign currencies directly with the U . S . Treasury
as w e l l as with the E S F . Concurrently, the C o m m i t t e e agreed to
raise the amount of eligible foreign currencies that the Federal
R e s e r v e w o u l d be prepared to warehouse to $1 3 A billion at this
time. T h e s e actions were taken in v i e w of the first issuance of
Treasury securities denominated in foreign currencies as o n e of
the measures announced on N o v e m b e r 1 in implementation of the
broad program to strengthen the dollar and thereby to counter
continuing d o m e s t i c inflationary pressures. The Treasury w a s
scheduled to receive payment of s o m e w h a t more than $1V2 billion
equivalent of German marks on D e c e m b e r 15, 1978.
A s a m e n d e d , paragraph 1A read as f o l l o w s :
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
Belgian francs
Canadian dollars
Danish kroner
Pounds sterling
French francs
German marks

Italian lire
Japanese yen
Mexican pesos
Netherlands guilders
Norwegian kroner
Swedish kronor
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.




61

63

Law Department
Statutes, regulations, interpretations, and decisions

INTEREST

ON

DEPOSITS

The Board of Governors has amended its provision of Regulation Q concerning penalty for early
withdrawals.
Effective December 6, 1978, Regulation Q is
amended by adding the following two sentences
as a new paragraph at the end of § 217.4(d)(3)
as follows:
SECTION

217.4—PAYMENT

BEFORE

MATURITY.

OF TIME

DEPOSITS

(d) Penalty for early withdrawals. * * *
(3) * * *
Under a time deposit agreement where subsequent
deposits reset the maturity of the entire account,,
each deposit maintained in the account for at least
a period equal to the original maturity of the
deposit may be regarded as having matured individually and been redeposited at intervals equal
to such period. When a time deposit is payable
only after notice, for funds on deposit for at least
the notice period, the penalty for early withdrawal
shall be imposed for at least the notice period.
4s

M<

Interpretation

5k

of Regulation

*

Q

The Board of Governors has issued an interpretation regarding the treatment of interest earned
on time deposit funds for purposes of the Board's
Regulation Q.
Effective December 6, 1978, Section 217.154
is added to read as follows:
SECTION

217.154—

WITHDRAWAL

OF

INTEREST

(a) The Board has been asked to review the
question of when interest earned on a time deposit
becomes part of the principal deposit for purposes
of the early withdrawal penalty requirements contained in section 217.4(d) of Regulation Q. As
noted in the requests, the Board's staff has pre-




viously advised that interest becomes part of the
underlying principal when it is credited or posted
to the depositor's account. Under this position,
where a depositor is permitted to make an early
withdrawal of time deposit funds, the depositor
will incur an early withdrawal penalty pursuant
to section 217.4(d) on all of the funds withdrawn
to the extent that the amount withdrawn reflects
the original principal and any earned interest that
has been credited or posted to the account.
(b) The Board does not believe that the frequency of compounding or the method of crediting
or posting interest to the account is necessarily
determinative of when interest should be viewed
as part of the underlying principal for purposes
of application of the Regulation Q early withdrawal restrictions. Adoption of such a position
is unnecessary to effectuate the purposes of interest
rate control, including the prohibition against payment of interest on demand deposits. In addition,
the Board notes that the outstanding position that
interest becomes part of the underlying principal
when credited or posted to the account and, thus,
is subject to Regulation Q early withdrawal restrictions, places member banks at a competitive
disadvantage with respect to nonmember insured
commercial banks that are permitted to pay accrued interest on a time deposit at anytime during
the initial term of the deposit contract.
(c) In view of the above considerations, the
Board has concluded that a member bank may
permit a depositor to withdraw the interest earned
on a time deposit at any time before maturity,
irrespective of the method that the bank uses to
compound or credit (post) interest to the depositor's account. The Board has concluded, however,
thai if a time deposit is renewed upon its original
maturity or if a depositor takes action to extend
the maturity of the time deposit during the original
maturity period, interest earned to the date of
renewal or extension, unless withdrawn, must be
viewed as part of principal subject to Regulation
Q withdrawal restrictions.
(d) This interpretation does not affect the treatment of interest as principal for purposes of assessing required reserves under Regulation D (12

A 64

Federal Reserve Bulletin • January 1979

CFR § 204). For purposes of determining required
reserves, interest that has been credited or posted
to a time deposit account will continue to be
viewed as a deposit on which reserves must be
maintained at the appropriate time deposit level.
*

BANK
RULES
OF

*

HOLDING
REGARDING

*

*

*

COMPANIES
DELEGATION

AUTHORITY

The Board of Governors has adopted two related
amendments to its Regulation Y and its Rules
Regarding Delegation of Authority.
1. Effective January 1, 1979, as to applications
accepted by any Federal Reserve Bank on or after
that date, section 225.4 of the Board's Regulation
Y is amended by revising subparagraphs (b)(1) and
(b)(2) to read as follows:
(b)(1) De novo entry. A bank holding company may engage de novo (or continue to engage
in an activity earlier commenced de novo), directly
or indirectly, solely in activities described in paragraph (a) of this section, 45 days after the company
has furnished its Reserve Bank a notice of the
proposal (in substantially the same form as F.R.
Y-4A), unless the company is notified to the contrary within that time or unless it is permitted to
consummate the transaction at an earlier date on
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
views on the proposal to the Reserve Bank. If
adverse comments of a substantive nature are
received within the time specified in the notice, 12
or if it otherwise appears appropriate in a particular
case, the Reserve Bank may inform the company
that (i) the proposal shall not be consummated until
specifically authorized by the Reserve Bank or by
the Board or (ii) the proposal should be processed
in accordance with the procedures of subparagraph
(2) of this paragraph. With respect to activities
to be engaged in outside the United States, the
procedures of this subparagraph apply solely to
activities to be engaged in directly by a domestic
bank holding company or by domestic nonbank
subsidiaries of any bank holding company. Para12
If a Reserve Bank decides that adverse comments are
not of a substantive nature, the person submitting the comments
may request review by the Board of that decision in accordance
with the provisions of § 265.3 of the Board's Rules Regarding
Delegation of Authority (12 CFR 265.3) by filing a petition
for review with the Secretary of the Board.




graphs (f) and (g) of this section govern other
international operations of bank holding companies.
(2) Acquisition of going concern. A bank
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
its Reserve Bank (Form F.R. Y-4). The Board will
publish in the Federal Register a notice of any
such application and will give interested persons
an opportunity to express their views (including,
where appropriate, by means of a hearing) on the
question whether performance of the activity proposed by the holding company can reasonably be
expected to produce benefits to the public, such
as greater convenience, increased competition or
gains in efficiency, that outweigh possible adverse
effects, such as undue concentration of resources,
decreased or unfair competition, conflicts of interests, or unsound banking practices.
2. Effective January 1, 1979, as to applications
accepted by any Federal Reserve Bank on or after
that date, section 265.2 of the Board's Rules
Regarding Delegation of Authority is amended by
revising paragraph (f)(20) of that section to read
as follows:
(f) Each Federal Reserve Bank is authorized,
as to member banks or other indicated organizations headquartered in its district:

(20) Under § 225.4(b)(1) of this chapter
(Regulation Y), and subject to § 265.3 if a person
submitting adverse comments that the Reserve
Bank has decided are not substantive files a petition for review by the Board of that decision,
(i) to permit a bank holding company to
engage de novo in activities specified in § 225.4(a)
(or retain shares in a company established de novo
and engaging in such activities) if its evaluation
of the considerations specified in section 4(c)(8)
of the Bank Holding Company Act leads it to
conclude that the proposal can reasonably be expected to produce benefits to the public.
(ii) to notify a bank holding company that
the proposal should not be consummated until
specifically authorized by the Reserve Bank or by
the Board or that the proposal should be processed
in a c c o r d a n c e w i t h the p r o c e d u r e s of
§ 225.4(b)(2).
(iii) to permit a bank holding company to
consummate the proposal before the expiration of

Law Department

65

the 45-day period referred to in §225.4(b)(1),
because exigent circumstances justify consummation at an earlier time.

serve Bank and seven hundred fifty thousand dollars ($750,000) for all Reserve Banks in the System.

Rules Regarding

RULES

Delegation

of

Authority

The Secretary of the Board of Governors has
approved a technical and conforming amendment
to the Board's Rules Regarding Delegation of
Authority to reflect recent organizational changes.
Effective October 17, 1978, section 265.2(j) is
deleted and section 265.2(d) is amended as follows:

OF

The Secretary of the Board of Governors has
approved an amendment to the Board's Rules of
Organization to reflect recent organizational
changes.
Effective November 1, 1978, section 3 of the
Rules of Organization is amended as follows:
SECTION

SECTION
GATED
RESERVE

265.2—SPECIFIC
TO BOARD

EMPLOYEES

FUNCTIONS
AND

TO

DELEFEDERAL

ORGANIZATION

3—CENTRAL

ORGANIZATION.

The Board's central organization consists of the
following Offices, Divisions and officials:

BANKS.

(d) The Staff Director for Federal Reserve Bank
Activities or the Staff Director's designee is authorized:

(3) Under the provisions of the third paragraph
of section 16 of the Federal Reserve Act (12
U.S.C. 413), to apportion credit among the Reserve Banks for unfit notes that are destroyed,
giving consideration to the net number of notes
of each denomination that were issued by each
Reserve Bank during the preceding calendar year.
(4) Under the provision of §§ 216.5(b),
216.5(d), and 216.6 of this chapter (Regulation
P), with respect to Federal Reserve Banks and
branches
(i) to require reports on security devices;
(ii) to require special reports; and
(iii) to determine in view of the provisions of
§§ 216.3 and 216.4 whether security devices and
procedures are deficient in meeting the requirements of Part 216, to determine whether such
requirements should be varied in the circumstances
of a particular banking office, and to require corrective action.
(5) To approve or disapprove supplementary
budget requests and special incentive programs to
improve operations or reduce costs, provided that
the Board has previously approved the budget of
the requesting Reserve Bank and provided that the
supplemental request adheres to the Board's general expense guidelines and such guidelines as the
Board may have imposed in approving the Reserve
Bank's budget and provided that the amount approved may not exceed in any budgetary year one
hundred thousand dollars ($100,000) for each Re-




(b) Office of Staff Director for Monetary and
Financial Policy is responsible for Federal Open
Market Committee staff activities; preparation of
proposals on monetary policy instruments including discount rates and reserve requirements; coordination of staff work on regulatory and supervisory issues closely related to domestic and
international monetary and financial policies and
the functioning of domestic and international
money and capital markets; coordination with the
System Account Manager on domestic open market activities and with the System Account Manager and the Treasury on foreign exchange market
activities; coordination of analysis and development of options for Board consideration with regard to foreign exchange policies and the international payments mechanism; Euro-dollar and international banking policy issues; coordination of
System statistical programs related to monetary
and financial policy operations; and appropriate
staff coordination with other government agencies
and with private groups in these areas.
BANK
MERGER

HOLDING
ORDERS

COMPANY
ISSUED

AND
BY

BANK

THE BOARD

OF

GOVERNORS

Orders Under Section 3
of Bank Holding Company

Act

Commerce Southwest Inc.,
Dallas, Texas
Order Approving
Formation of Bank Holding

Company

Commerce Southwest Inc., Dallas, Texas, has
applied for the Board's approval under section

A 66

Federal Reserve Bulletin • January 1979

3(a)(1) of the Bank Holding Company Act (12
U.S.C. § 1842(a)(1)) of formation of a bank
holding company by acquiring 100 percent (less
directors' qualifying shares) of the voting shares
of the successor by merger to National Bank of
Commerce of Dallas, Dallas, Texas ("Bank"). 1
The bank into which Bank is to be merged has
no significance except as a means to facilitate the
acquisition of the voting shares of Bank. Accordingly, the proposed acquisition of shares of the
successor organization is treated herein as the
proposed acquisition of the shares of Bank.
Notice of the application, affording opportunity
for interested persons to submit comments and
views, has been given in accordance with section
3(b) of the Act. The time for filing comments and
views has expired, and the Board has considered
the application and all comments received in light
of the factors set forth in section 3(c) of the Act
(12 U.S.C. § 1842(c)).
Applicant, a nonoperating corporation with no
subsidiaries, was formed for the purpose of becoming a bank holding company through the acquisition of Bank. Bank, with total deposits of
$248.6 million is the 24th largest bank in Texas,
holding 0.41 percent of total deposits in commercial banks in the state. 2 Upon acquisition of Bank,
Applicant would control the sixth largest bank in
the relevant banking market and 2.2 percent of
total deposits therein.3 The proposal represents a
restructuring of the ownership of Bank, and since
Applicant has no other banking subsidiaries 4 and
Applicant's principals do not control any other

banking organizations, consummation of the proposal would have no adverse effects on existing
or potential competition, nor would it increase the
concentration of banking resources in the relevant
banking market. Accordingly, the Board concludes that competitive considerations are consistent with approval of the application.
The managerial resources of Applicant and
Bank are regarded as satisfactory, and consummation of the proposal would strengthen the financial
resources of Bank. Furthermore, the Board notes
that the overall position and operations of Bank
have improved since its present management assumed responsibility for the operation of Bank in
1974. Therefore, considerations relating to banking factors are consistent with approval of the
application.
Although Applicant does not propose any immediate changes in Bank's services, convenience
and needs considerations are consistent with approval of the application. Accordingly, it is the
Board's judgment that the proposed acquisition is
consistent with public interest and that the application should be approved.
On the basis of the record, the application is
approved for the reasons summarized above. The
transaction shall not be made before the thirtieth
calendar day following the effective date of this
Order or later than three months after the effective
date of this Order, unless such period is extended
for good cause by the Board, or by the Federal
Reserve Bank of Dallas pursuant to delegated
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
activities that are impermissible for a bank holding company.
Under section 4(a)(2) of the Act these activities may not be
retained beyond two years from the date Applicant becomes
a bank holding company. Applicant has committed to the Board
that it will divest these impermissible activities within the
two-year period.
2

All banking data are as of December 31, 1977, and reflect
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
will be deemed to control the shares of three banks, including
Dallas/Fort Worth Airport National Bank ("Airport B a n k " ) ,
which were acquired by Bank in 1975 in satisfaction of debts
previously contracted. In 1977 Bank transferred the shares of
each such bank to various transferees w h o were indebted to
Bank, and under section 2(g)(3) of the Act, Bank is deemed
to control the shares of the banks transferred. Inasmuch as
section 3(a)(A)(i) of the Act requires Bank to divest control
of such shares on December 2 9 , 1978, with respect to Airport
Bank and on March 9, 1979, with respect to the other two
banks, Applicant has not filed applications for the acquisition
of any of these banks. Furthermore, Applicant has committed
that it will cause Bank to file with the Board a request for
a determination under section 2(g)(3) of the Act that Bank
is not capable of controlling Airport Bank.




Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman
Miller.

[SEAL]

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

Arkansas Best Corporation,
Fort Smith, Arkansas
Order Approving
Acquisition of Shares of Bank Holding

Company

Arkansas Best Corporation, Fort Smith, Arkansas, a bank holding company within the meaning of the Bank Holding Company Act, with
respect to National Bank of Commerce of Dallas
("Bank"), Dallas, Texas, has applied for the

Law Department

Board's approval under section 3(a)(3) of the Act
(12 U.S.C. § 1842(a)(3)) to acquire an indirect
interest in Bank by exchanging the shares of Bank
it now holds for 11.7 percent of the voting shares
of Commerce Southwest Inc., Dallas, Texas
("Commerce"). 1
Notice of the application, affording opportunity
for interested persons to submit comments and
views, has been given in accordance with section
3(b) of the Act. The time for filing comments and
views has expired, and the Board has considered
the application and all comments received in light
of the factors set forth in section 3(c) of the Act
(12 U.S.C. § 1842(c)).
Commerce has been formed to effectuate a corporate reorganization of Bank, in which Applicant
holds an 11.7 percent interest. In connection with
this corporate reorganization, Applicant proposes
to change its direct ownership of shares of Bank
to indirect ownership of shares of Bank through
ownership of shares of Commerce. Inasmuch as
Applicant's proposed acquisition of voting shares
of Commerce is merely a restructuring of Applicant's interest in Bank, the acquisition would have
no adverse effects on competition. Furthermore,
since Applicant's proportionate interest in Bank
would not be altered, considerations relating to the
financial and managerial resources of Applicant
and Bank, as well as considerations relating to the
convenience and needs of the community to be
served, are regarded as consistent with approval
of the application. Accordingly, it is the Board's
judgment that the proposed transaction would be
consistent with the public interest and that the
application should be approved.
On the basis of the record, the application is
approved for the reasons summarized above. The
transaction shall not be made before the thirtieth
calendar day following the effective date of this
Order or later than three months after the effective
date of this Order, unless such period is extended
1
Applicant became a bank holding company as a result of
the 1970 Amendments to the Act by virtue of its ownership
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
the Board's Regulation Y, Applicant filed an irrevocable declaration that it will cease to be a bank holding company on
or before December 31, 1980. Applicant has reduced its
ownership of Bank to approximately 11.7 percent and no longer
participates in the active management of Bank. While the
Board has stated that applications to expand banking activities
under § 3 of the Act are not generally appropriate for companies that have filed § 4(c)(12) declarations, Applicant will not
increase its proportionate interest in Bank, and the shares of
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

FEDERAL RESERVE BULLETIN 3 0 6 ( 1 9 7 2 ) a n d A r c h e r - D a n i e l s M i d l a n d C o m p a n y , 6 1 FEDERAL RESERVE BULLETIN ( 1 9 7 5 ) ) .




67

for good cause by the Board, or by the Federal
Reserve Bank of Dallas pursuant to delegated
authority.
By order of the Board of Governors, effective
December 22, 1978.
Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman
Miller.

[SEAL]

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

First Michigan Bank Corporation,
Zeeland, Michigan
Order Approving

Acquisition

of Bank

First Michigan Bank Corporation, Zeeland,
Michigan, a bank holding company within the
meaning of the Bank Holding Company Act, has
applied for the Board's approval under section
3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to
acquire all of the voting shares (less directors'
qualifying shares) of the successor by merger to
National Lumberman's Bank and Trust Company,
Muskegon, Michigan ("Bank"). The bank into
which Bank is to be merged has no significance
except as a means to facilitate the acquisition of
shares of the successor organization is treated
herein as the proposed acquisition of the shares
of Bank.
Notice of the application, affording opportunity
for interested persons to submit comments and
views, has been given in accordance with § 3(b)
of the Act. The time for filing comments and views
has expired, and the Board has considered the
application and all comments received in light of
the factors set forth in § 3(c) of the Act (12 U.S.C.
§ 1842(c)).
Applicant, the 27th largest banking organization
in Michigan, controls three banking subsidiaries
with aggregate deposits of approximately $188.8
million, representing 0.5 percent of total commercial bank deposits in the state. 1 Acquisition of
Bank ($137.1 million in deposits) would increase
Applicant's share of statewide commercial bank
deposits by approximately 0.4 percent and would
not have an appreciable effect upon the concentration of banking resources in Michigan.
Bank is the second largest of seven banking
organizations in the Muskegon/Grand Haven
1
All banking data are as of December 31, 1977, and reflect
bank holding company formations and acquisitions approved
as of November 30, 1978.

A 68

Federal Reserve Bulletin • January 1979

banking market (the relevant market),2 and controls approximately 22.5 percent of the total deposits in commercial banks in the market. Since
acquisition of Bank would represent Applicant's
initial entry into the Muskegon/Grand Haven
banking market, upon consummation of the proposal no significant existing competition would be
eliminated between Bank and any of Applicant's
subsidiary banks. Applicant could enter the market
by establishing a de novo subsidiary bank. However, demographic data indicate that the market
is not attractive for such entry by Applicant. 3
Accordingly, based upon the above and other facts
of record, the Board has determined that competitive considerations are consistent with approval of
the application.
The financial and managerial resources and future prospects of Applicant, its subsidiaries and
Bank are regarded as generally satisfactory, particularly in view of Applicant's commitment to
provide Bank with additional equity capital. Accordingly, considerations relating to banking factors are consistent with approval of the application.
Considerations relating to the convenience and
needs of the community to be served are regarded
as consistent with approval. It is the Board's
judgment that consummation of the transaction
would be in the public interest and that the application should be approved.
On the basis of the record, the application is
approved for the reasons summarized above. The
transaction shall not be consummated before the
thirtieth calendar day following the effective date
of this Order or later than three months after the
effective date of this Order, unless such period
is extended for good cause by the Board or by
the Federal Reserve Bank of Chicago acting pursuant to delegated authority.
By order of the Board of Governors, effective
December 28, 1978.
Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman

[SEAL]

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

2
The Muskegon/Grand Haven banking market is approximated by Muskegon County, Michigan, except for Casnovia
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-

tion, M u s k e g o n ,

Michigan

( 6 3 FEDERAL RESERVE

BULLETIN

9 2 6 (1977)), the Board determined that the Muskegon/Grand
Haven banking market was generally unattractive for de novo
entry. Recent data indicate that the Muskegon/Grand Haven
banking market continues to be unattractive for de novo entry.




M.S.B. Agency, Inc.,
St. Paul, Minnesota
Order Denying
Formation of Bank Holding

Company

M.S.B. Agency, Inc., St. Paul, Minnesota, has
applied for the Board's approval under section
3(a)(1) of the Bank Holding Company Act (12
U.S.C. § 1842(a)(1)) of formation of a bank
holding company through acquisition of 85.1 percent of the voting shares of Minnesota State Bank
of St. Paul, St. Paul, Minnesota ("Bank").
Notice of the application, affording opportunity
for interested persons to submit comments and
views, has been given in accordance with section
3(b) of the Act. The time for filing comments and
views has expired, and the Board has considered
the application and all comments received in light
of the factors set forth in section 3(c) of the Act
(12 U.S.C. § 1842(c)).
Applicant, a nonoperating corporation with no
subsidiaries, was organized for the purpose of
becoming a bank holding company through acquisition of Bank, the 67th largest banking organization in Minnesota, which holds deposits of approximately $25.3 million. 1 Upon acquisition of
Bank, Applicant would control about 0.1 percent
of total deposits in commercial banks in the state.
Bank is the 33rd largest of 113 banking organizations in the relevant banking market,2 and controls 0.3 percent of total market deposits. While
Applicant's principal is also a principal in several
other banking organizations, none of these banking
organizations compete in the relevant banking
market. Therefore, it appears that no competition
would be eliminated as a result of consummation
of this proposal. Moreover, inasmuch as the proposed transaction involves the transfer of ownership of Bank from an individual and several corporations controlled by that individual to a single
corporation owned by the individual, it appears
that consummation of this proposal would have
no adverse effects upon existing or potential competition, nor would it increase the concentration
of banking resources in the relevant market. Accordingly, the Board concludes that competitive
considerations of the proposal are consistent with
approval of the application.

1
All banking data are as of March 3 1 , 1978, unless otherwise stated.
2
The relevant banking market is approximated by the Minneapolis-St. Paul R M A , adjusted to include all of Carver
County.

Law Department

The Board has indicated on previous occasions
that a holding company should serve as a source
of financial and managerial strength to its subsidiary bank and that the Board will closely examine
the condition of an applicant in each case with
this consideration in mind. 3 Having examined such
factors in light of the record in this application,
the Board concludes that the record presents adverse considerations that warrant denial of the
proposal to place the ownership of Bank into
corporate form.
As part of the subject proposal, Applicant would
assume a substantial portion of the debt incurred
by Applicant's principal in acquiring his shares
of Bank. Applicant proposes to service this debt
over a 12-year period through dividends to be
declared by Bank and tax benefits to be derived
from filing consolidated tax returns. In the Board's
view, Applicant's financial projections over the
debt retirement period appear to be unduly optimistic and it does not appear that Applicant will
possess the financial flexibility necessary to meet
its annual debt service requirements while maintaining adequate capital at Bank. Even under Applicant's projections for deposit growth, Bank's
gross capital to total assets ratio at the end of the
12-year debt-servicing period will be below the
level deemed acceptable. These projections are
based on the average deposit growth of nine percent for the years 1973-77. However, under present ownership and management, deposit growth
has averaged 15 percent annually. Projections
based on this information indicate that capital
would decline still further by the end of the debtservicing period. Based on these factors, Bank has
not demonstrated the ability to pay dividends to
provide a source of debt-servicing funds to Applicant without placing a potential strain on Bank's
capital position. The Board also notes that the
other holding companies with which Applicant's
principal is associated are likewise highly leveraged. The Board is of the view that it would

3

The Bank Holding Company Act requires that the Board,
in acting on an application to acquire a bank, inquire into the
financial and managerial resources of an applicant. While this
proposal involves the transfer of the ownership of Bank from
individuals to a corporation o w n e d by the same individuals,
the Act requires that before an organization is permitted to
become a bank holding company and thus obtain the benefits
associated with the holding company structure, it must secure
the Board's approval. Section 3(c) of the Act provides that
the Board must, in every case, consider, among other things,
the financial and managerial resources of both the applicant
company and the bank to be acquired. The Board's action in
this case is based on a consideration of such factors. See Board
of Governors

of the Federal

wood Corporation,




Reserve

System

v . First

Lincoln-

4 7 U . S . L . W . 4 0 4 8 (December 11, 1978).

69

not be in the public interest to approve the formation of a bank holding company with an initial
debt structure that could result in the weakening
of Bank's overall financial condition. Accordingly,
in view of these and other facts of record, the
Board concludes that the considerations relating
to banking factors weigh against approval of the
application.
No significant changes in Bank's operations or
in the services offered to its customers are anticipated to follow from consummation of the proposed acquisition. Consequently, convenience and
needs factors lend no weight toward approval of
this application.
On the basis of all the facts of record, the Board
concludes that the banking considerations involved
in this proposal present significant adverse factors
bearing upon the financial and managerial resources and future prospects of Applicant and
Bank. Such adverse factors are not outweighed by
any procompetitive effects or by benefits that
would result in better serving the convenience and
needs of the community. Accordingly, it is the
Board's judgment that approval of the application
would not be in the public interest and that the
application should be denied.
On the basis of all the facts of record, the
application is denied for the reasons summarized
above.
By order of the Board of Governors, effective
December 22, 1978.
Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman
Miller.

(Signed)
[SEAL]

THEODORE

Secretary

E. A L L I S O N ,
of the Board.

The Wyoming National Corporation,
Casper, Wyoming
Order Approving

Acquisition

of Bank

The Wyoming National Corporation, Casper,
Wyoming, a bank holding company within the
meaning of the Bank Holding Company Act, has
applied for the Board's approval under section
3(a)(3) of the Act (12 U.S.C. § 1842(a)(3)) to
acquire 85.8 percent or more of the voting shares
of Wyoming National Bank of East Casper,
Casper, Wyoming ("Bank"), a proposed new
bank.
Notice of the application, affording opportunity
for interested persons to submit comments and

A 70

Federal Reserve Bulletin • January 1979

views, has been given in accordance with § 3(b)
of the Act. The time for filing comments and views
has expired, and the Board has considered the
application and all comments received, including
those of the Comptroller of the Currency, in light
of the factors set forth in section 3(c) of the Act
(12 U.S.C. § 1842(c)).
Applicant, the third largest bank holding company in Wyoming, controls three bank subsidiaries
with aggregate deposits of $210 million, representing 9.7 percent of total deposits in commercial
banks in Wyoming. 1 Since the application involves
the acquisition of a proposed new bank, consummation of the proposal would not immediately
increase Applicant's share of deposits in commercial banks in Wyoming.
Bank, a new bank that has received preliminary
charter approval from the Comptroller of the Currency, is to be located in the eastern section of
the Casper banking market,2 the same market in
which Applicant's lead bank is located. Applicant,
the largest banking organization in the Casper
banking market, controls deposits of $192.2 million, representing 43.2 percent of total deposits
in commercial banks in the market. While Applicant is the largest banking organization in the
market, the Board finds that consummation of the
proposal would not have significant anti-competitive effects. The Board notes that the market has
experienced significant growth in the past decade
and this growth, which has enabled four banks
to enter the market and a fifth bank to be chartered
since 1960, is expected to continue; that the market 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
bank site from future market entrants.3 Accordingly, on the basis of the above and other facts
of record, the Board concludes that competitive
considerations are consistent with approval of the
application.
The financial and managerial resources and future prospects of Applicant and its three subsidiary
banks are regarded as sastisfactory. Bank, as a
proposed new bank, has no financial or operating
1

All banking data are as of June 30, 1978.
The Casper banking market is approximated by the Casper
Ranally Metropolitan Area, which includes the City of Casper
and the towns of Mills, Evansville, and Paradise Valley, all
in Natrona County, W y o m i n g .
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
the market in connection with another application, and its
preliminary finding is that the market boundaries should either
remain the same or be expanded. The Board does not find
2




history; however, its prospects as a subsidiary of
Applicant appear favorable. Accordingly, considerations relating to banking factors are consistent
with approval. Considerations relating to the convenience and needs of the community to be served
lend some weight toward approval since entry of
Bank into the eastern portion of the market will
give residents of that community a more convenient source of banking services. Therefore, it is
the Board's judgment that the proposed acquisition
would be in the public interest and that the application should be approved.
On the basis of the record, the application is
approved for the reasons summarized above. The
transaction shall not be made (a) before the thirtieth calendar day following the effective date of
this Order or (b) later than three months after that
date, and (c) Wyoming National Bank of East
Casper, Casper, Wyoming, shall be opened for
business not later than six months after the effective date of this Order. Each of the periods described in (b) and (c) may be extended for good
cause by the Board, or by the Federal Reserve
Bank of Kansas City pursuant to delegated authority.
By order of the Board of Governors, effective
December 28, 1978.
Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman
Miller.

[SEAL]

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

Orders Under Section 4
of Bank Holding Company

Act

Bank America Corporation,
San Francisco, California
Order Denying Continuation of Commercial Finance Activities and Commencement of Loan
Servicing, Leasing, and Credit-related
Insurance
Agency
Activities
BankAmerica Corporation, San Francisco, California, a bank holding company within the meaning of the Bank Holding Company Act, has applied for the Board's approval, under § 4(c)(8) of

it necessary to await the conclusion of this market study before
acting on this application since a Board finding that the market
should be expanded would not alter the Board's competitive
analysis of this proposal.

Law Department

the
Act
(12
U.S.C.
§ 1843(c)(8))
and
§225.4(b)(1) of the Board's Regulation Y (12
C.F.R. § 225.4(b)(1)), to continue 1 to engage in
commercial finance activities through FinanceAmerica Commercial Corporation ("FACC"),
Allentown, Pennsylvania, a direct subsidiary of
Finance America Corporation, Allentown, Pennsylvania, which is a direct subsidiary of Applicant.
Such activities include inventory and accounts
receivable financing, lease financing, equipment
financing, insurance premium financing, making
loans to non-affiliated finance and leasing companies secured by pledges of accounts receivable of
such companies, making loans secured by real and
personal property, and purchasing retail instalment
sales contracts. FACC also proposes to engage in
the additional activities of servicing extensions of
credit for itself and others, leasing real and personal property, and offering credit-related life,
accident and disability, and property insurance in
connection with extensions of credit made or acquired by FACC. Such activities have been determined by the Board to be closely related to banking (12 C.F.R. §§ 225.4(a)(1), (3), (6), and (9)).
Notice of the application, affording opportunity
for interested persons to submit comments and
views on the public interest factors, has been duly
published (43 Federal Register 24912 (1978)).
The time for filing comments and views has expired and the Board has considered the application
and all comments received in the light of the public
interest factors set forth in § 4(c)(8) of the Act
(12 U.S.C. § 1843(c)(8)).
Applicant is the largest banking organization in
the United States and controls Bank of America,
N. T. & S. A., San Francisco, California, which
holds deposits of approximately $66.66 billion. 2
In addition, Applicant directly controls twelve
nonbanking subsidiaries.
FACC (total assets of $23 million as of December 31, 1977) has for four years, without prior
Board approval, engaged in a range of commercial
lending activities. These activities have been conducted from an office in Allentown, Pennsylvania,
and were commenced in violation of the Board's
Regulation Y. FACC has terminated the solicitation of new business during the oendencv of the
1
On January 1, 1974, Applicant acquired shares of FinanceAmerica Corporation, formerly G A C Finance, Inc., with the
prior approval of the Board. At all times relevant hereto prior
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.
2
All banking data are as of March 31, 1978.




71

instant application. Upon approval of the application, Applicant proposes to have FACC recommence the activities terminated and to expand its
activities to include servicing extensions of credit
for itself and others, leasing real and personal
property, and offering credit-related life, accident
and disability, and property insurance in connection with extensions of credit made or acquired
by FACC.
Consummation of this proposal would not eliminate existing or potential competition. The markets for the services offered by FACC do not
appear highly concentrated. FACC proposes to
solicit business in 36 states and the District of
Columbia and expects to compete principally with
large commercial banks and finance companies.
On the basis of the facts of record, the Board
concludes that consummation of the subject proposal would not have any significant adverse competitive effects.
As indicated above, the application presents an
after-the-fact request for the Board's approval to
conduct operations commenced in violation of the
Board's Regulation Y. Last year the Board considered and approved a somewhat similar domestic
case in which Applicant had engaged in nonbank
activities in violation of Regulation Y. 3 In the
international area, the Board has considered several applications by Applicant that have involved
violations of the Board's regulations. Due in part
to the Board's concern about such violations,
Applicant instituted an extensive compliance program to ensure that all of its activities were conducted in conformity with the substantive and
procedural requirements of law and the Board's
regulations. After evaluating the merits of each
of the cases where a violation had occurred, the
Board concluded that approval was appropriate.
With respect to the subject proposal, however, the
Board does not believe that approval of Applicant's conduct, which was in violation of the
Board's Regulation Y, would be appropriate. Of
particular concern to the Board in this matter is
that when Applicant initially advised the Board
of the violation, Applicant attributed the violation
to a lack of knowledge on the part of personnel
of Finance America Corporation in Allentown, the
parent of FACC. In response to questions posed
by the Board's staff, however, and upon further
investigation of the facts, the direct involvement

3

BankAmerica

Corporation

(Data processing activities of

F i n a n c e A m e r i c a ) 6 3 FEDERAL RESERVE B U L L E T I N 6 8 7

(1977).

A 72

Federal Reserve Bulletin • January 1979

of Applicant's management in San Francisco was
established.
While the subject proposal does not represent
a significant activity to an organization of the size
and complexity of Applicant, the Board does not
regard such factors as relieving an organization
from legal duties and obligations to which it and
competing organizations of lesser size and complexity are subject. The effectiveness of an organization's management in ensuring compliance
with the legal duties to which it is subject are
matters of paramount concern to the Board in
acting on applications. It is the Board's judgment,
based upon all the facts of record in this matter,
that approval of the application would be inappropriate, and in order to ensure that Applicant does
not benefit from actions that were commenced as
a result of a violation, Applicant should be required to divest itself promptly of the illegally
acquired assets of FACC.
Accordingly, based upon the foregoing and
other considerations reflected in the record, the
Board has determined that the subject application
should be denied. 4 Applicant is hereby directed
to divest itself of the assets of FACC that were
acquired in violation of the Board's Regulation Y
no later than ninety days from the effective date
of this Order.
By order of the Board of Governors, effective
December 26, 1978.
Voting for this action: Governors Wallich, Partee,
and Teeters. Present and not voting: Governor Coldwell. Absent and not voting: Chairman Miller.

(Signed)
[SEAL]

THEODORE E .

Secretary

ALLISON,

of the Board.

Financial General Bankshares, Inc.,
Washington, D.C.
Order Approving
Retention of National Mortgage

Corporation

Financial General Bankshares, Inc., Washington, D.C., a bank holding company within the
meaning of the Bank Holding Company Act, has

4
In acting on this application the Board has considered
comments from an individual from Providence, Rhode Island,
in opposition to approval of Applicant's proposal, questioning
whether Applicant's sale of property insurance would serve
the interests of the people of that state. The Board has examined
the protest, and, in light of the protestant's failure to cite any
supporting facts, concludes that there exists no basis in fact
for the individual's concern.




applied for the Board's approval, under section
4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and
section 225.4(b)(2) of the Board's Regulation Y
(12 C.F.R. § 225.4(b)(2)), to retain ownership of
National Mortgage Corporation, Washington,
D.C. ("Company"), a company that engages in
the activity of mortgage banking. 1 Such activity
has been determined by the Board to be closely
related to banking (12 C.F.R. § 225.4(a)(1)).
Notice of the application, affording opportunity
for interested persons to submit comments and
views on the public interest factors, has been duly
published (43 Federal Register 53,496). The time
for filing comments and views has expired, and
the Board has considered the application and all
comments received in the light of the public interest factors set forth in section 4(c)(8) of the Act
(12 U.S.C. § 1843(c)(8)).
The Board regards the standards of section
4(c)(8) for the retention of a nonbanking activity
to be the same as the standards for a proposed
acquisition of a section 4(c)(8) activity. Applicant,
a multibank holding company with bank subsidiaries in four states and the District of Columbia,
has six bank subsidiaries in the relevant mortgage
market that are active mortgage lenders. 2 These
banks, as of June 30, 1978, had outstanding mortgage loans of $415 million, representing 2.1 percent of mortgage loans outstanding in the market,
while Company currently has $1.9 million in
mortgage loans outstanding in the market.
The acquisition by Applicant of Company in
1963, at which time Company was a small independent mortgage company, did not have any
significant adverse competitive effects. Since
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
for mortgage services. There is no evidence indicating that the retention of Company by Applicant
would lead to any undue concentration of resources, conflicts of interests, or unsound banking
practices. Furthermore, approval of the application
would enable Company to become an additional
competitor serving the mortgage needs of the rele1
Applicant became a bank holding company as a result of
the 1966 amendments to the Act, which also required divestiture of Applicant's impermissible nonbanking interests by
December 31, 1978. Subsequently, the 1970 Amendments to
the Act were passed, and Applicant now seeks to retain
Company through this application, pursuant to section 4(c)(8)
of the Act.
2
The market for Company's mortgage activity is approximately the area within a 75-mile radius from the center of
Washington, D . C .

Law Department

vant community and this result would be of benefit
to the public.
Based upon the foregoing and other considerations reflected in the record, the Board has
determined that the balance of the public interest
factors the Board is required to consider under
§ 4(c)(8) is favorable. Accordingly, the application is hereby approved. This determination is
subject to the conditions set forth in section
225.4(c) of Regulation Y and to the Board's authority to require such modification or termination
of the activities of a holding company or any of
its subsidiaries as the Board finds necessary to
assure compliance with the provisions and purposes of the Act and the Board's regulations and
orders issued thereunder, or to prevent evasion
thereof.
By order of the Board of Governors, effective
December 28, 1978.
Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman
Miller.

[SEAL]

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

Manufacturers Hanover Corporation,
New York, New York
Order Denying Request for
Reconsideration
and Stay
Georgia Legal Services Program, Inc., Atlanta,
Georgia, has requested reconsideration, and a stay
pending reconsideration by the Board, of the Order
of the Board dated May 1, 1978, approving the
application of Manufacturers Hanover Corporation, New York, New York, pursuant to section
4(c)(8) of the Bank Holding Company Act (12
U.S.C. § 1843(c)(8)) to acquire First Credit Corporation, Whiteville, North Carolina, and First
Credit Corporation of Georgia, Fayetteville,
Georgia. Georgia Legal Services Program, Inc.,
has also requested to present its views orally to
the Board.
The Board has reviewed the request for reconsideration and finds that Georgia Legal Services
Program, Inc., has not presented relevant facts
that, for good cause shown, were not previously
presented to the Board. Moreover, it does not
otherwise appear that reconsideration of the
Board's Order of May 1, 1978, would be appropriate.




73

Therefore, the Board hereby denies the request
of Georgia Legal Services Program, Inc., for reconsideration of the Board's Order of May 1,
1978. 1
By order of the Board of Governors, effective
December 22, 1978.
Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman
Miller.

[SEAL]

(Signed) G R I F F I T H L. G A R W O O D ,
Deputy Secretary of the Board.

1
In view of the Board's decision to deny the request for
reconsideration, the requests for a stay, pending reconsideration by the Board, and to present views orally to the
Board, are hereby rendered moot.

Security Pacific Corporation,
Los Angeles, California
Order Approving Acquisition of
American Finance System
Incorporated
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 approval, under § 4(c)(8) of the Act (12 U.S.C.
§ 1843(c)(8)) and § 225.4(b)(2) of the Board's
Regulation Y (12 C.F.R. § 225.4(b)(2)), to acquire all of the outstanding shares of American
Finance System Incorporated, Silver Spring,
Maryland ("AFSI"), 1 and thereby to acquire control of certain of its subsidiaries including General
Fidelity Life Insurance Company, Richmond,
Virginia ("GFLIC"). 2 AFSI, directly and through
subsidiaries, is engaged in making direct consumer
instalment loans, secured and unsecured, to individuals, purchasing consumer instalment sales fi-

1
Applicant proposes to acquire the shares of AFSI by
merging it into a nonoperating wholly-owned subsidiary of
Applicant. The subsidiary into which AFSI is to be merged
has no significance except as a means to facilitate the acquisition of the shares of AFSI.
2
Applicant also proposes to acquire indirectly four whollyowned subsidiaries of AFSI that are engaged solely in the
provision of specialized nonbanking service activities, such as
management consulting, accounting, advertising, personnel,
purchasing, printing and supply, and acting as agent for collection of insurance commissions. Such services are provided
exclusively to AFSI and its other subsidiaries in connection
with its finance and insurance business. AFSI could itself
perform such activities directly through a division or department, and the Board believes that § 4(c)(8) of the Act permits,
with the Board's approval, the acquisition of shares of whollyowned subsidiaries of a § 4(c)(8) company that engage in
activities that such a company could engage in directly.

A 74

Federal Reserve Bulletin • January 1979

nance contracts, making secured and unsecured
commercial and agricultural loans, and operating
two industrial banks under the laws of Colorado. 3
AFSI, directly and through subsidiaries, also acts
as agent for the sale of credit life and credit
accident and health insurance and property insurance, all of which are directly related to extensions
of credit by AFSI. 4 Through GFLIC, AFSI acts
as underwriter for credit life, accident, and health
insurance directly related to extensions of credit
by AFSI. 5 Each of these activities has been determined by the Board to be closely related to banking (12 C.F.R. § 225.4(a)(1), (2), (9), and (10)).
Notice of the application, affording opportunity
for interested persons to submit comments on the
public interest factors, has been duly published (43
Federal Register 37490). The time for filing comments has expired, and the Board has considered
the application and all comments received, including those of the West Virginia Independent
Bankers Association ("IBA"), in the light of the
public interest factors set forth in § 4(c)(8) of the
Act. 6
Applicant, by virtue of its control of Security
Pacific National Bank, Los Angeles, California
("Bank"), is the second largest banking organization in California and the seventh largest in the
United States in terms of domestic deposits. Bank,
with deposits of $11.8 billion, representing 11.7
percent of the total deposits in commercial banks
in California, offers retail, wholesale, domestic
and international banking, and trust services. 7 Applicant engages through subsidiaries in a variety
of nonbanking activities, including mortgage
banking, leasing, and venture capital financing.

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
certain insurance policies Unrelated to extensions of credit.
Applicant has committed to the Board that upon consummation, it will discontinue this activity.
5
GFLIC presently underwrites credit life and credit accident
and health insurance for unaffiliated financial institutions.
However, Applicant does not seek the Board s permission to
engage in this business, and has committed to the Board that
it will cause GFLIC to dispose of this business.
6
IB A contends that Applicant's acquisition of 16 AFSI
offices in West Virginia would represent the formation of a
multibank holding company in violation of state law. Section
31 A - 1 - 2 of the West Virginia Banking Code defines " b a n k "
as a corporation chartered to conduct a banking business, a
trust company., or an industrial bank chartered in West Virginia. Inasmuch as AFSI's West Virginia offices do not fall
within any of these categories, and are not banks under state
law, the Board concludes that IBA's objection to the proposal
is not persuasive.
7
All financial data are as of December 31, 1977, unless
otherwise indicated.




Through its subsidiaries, Security Pacific Finance Corp., Los Angeles, California ("SPFC")
and The Bankers Investment Company, Hutchinson, Kansas ("BIC"), Applicant also engages in
consumer and commercial finance and creditrelated insurance agency and underwriting activities, similar to those of AFSI and its subsidiaries. 8
SPFC and BIC operate 90 loan offices in twelve
states, and together they are the 58th largest noncaptive finance company in the United States in
terms of total capital. 9 On December 31, 1977,
they had consolidated assets of $209 million and
receivables of $164 million, the majority of which
were loans originated in California and Kansas.
AFSI is the 21st largest non-captive finance
company in the United States on the basis of total
capital, 10 and has total assets of $340 million and
receivables of approximately $350 million. It
operates 370 offices in 22 states of which approximately 220 such offices, accounting for 70 percent
of AFSI's receivables, are located in an eight-state
area consisting of Maryland, Virginia, West Virginia, Pennsylvania, Ohio, New York, New Jersey, and Delaware.
The Board believes that the relevant product
market to be considered in evaluating the competitive effects of this proposal is the making of
personal cash loans. 11 SPFC and BIC have loan
offices in seventeen local markets where AFSI has
loan offices, and from the record it appears that
both Applicant and AFSI hold a significant amount
of the outstanding personal cash loans in at least
sixteen of those markets. In order to eliminate the
possibility that consummation of the proposal
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

8
SPFC was organized de novo by Applicant in 1974 to
conduct its consumer finance business primarily in California.
In 1976 Applicant acquired BIC with 57 finance offices located
in nine south-central states and having total assets of $ 4 0
million. These BIC offices do business under the name of
SPFC.
9
American
Banker, June 19, 1978. A "non-captive" finance company is one that does not restrict its business to
loans made in connection with the purchase of a particular
manufacturer's product.
10

Id.

11
Since AFSI is also engaged in other types of consumer
lending, Applicant contends that the relevant product market
should include several other types of loans and lenders. The
Board has examined Applicant's data submitted in support of
its claim in this regard, but in light of the fact that personal
cash loans continue to be the principal product offered by
consumer finance companies, the Board believes that there are
not sufficient grounds to warrant a departure from its earlier

d e t e r m i n a t i o n . Bankers
Trust
Corporation/Public
pany,
5 4 FEDERAL RESERVE B U L L E T I N ( 1 9 7 3 ) .

Loan

Com-

Law Department

ensure that the offices will be completely divested
and that they will be divested as viable going
concerns, the Board expects that such offices will
be sold as going concerns holding substantially the
same quality and type of assets as those offices
held on October 30, 1978 and in an amount not
less than the amount held by those offices on that
date. Applicant proposes to retain the two offices
of AFSI that are chartered as Colorado industrial
banks, because of the difficulty of obtaining industrial bank charters in metropolitan areas in
Colorado. While such difficulty alone would not
justify retention of these offices, in this case the
combined market share of Applicant and AFSI in
each of the two markets in which the industrial
banks operate would be less than one percent.
Thus, while the acquisition of AFSI by Applicant
will eliminate some existing competition between
them, in view of the small size of the market shares
in the two markets and the large number of competitors in each market, the Board does not view
the effects of the transaction on existing competition as significant.
With regard to potential competition, the Board
notes that AFSI has recently experienced serious
operational problems, and undergone a significant
contraction in its operations since 1973, with the
number of its offices being reduced from 758 to
370 and its gross loan receivables declining from
$515 million to $350 million. In view of problems
faced by AFSI and its prospects for the future,
it does not appear that AFSI is a likely entrant
into the local markets where Applicant presently
has offices. On the other hand, Applicant has
increased the number of its loan offices by one
third since 1976, and it has the potential to enter
many of the local markets where AFSI presently
has offices. However, in light of the large number
of other potential entrants into AFSI's local markets, 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
finance company, proposes to acquire the 21st
largest finance company. Moreover, Applicant's
subsidiary bank has approximately $111 million
in loans outstanding to finance companies other
than its subsidiaries and AFSI. On the basis of
these and other facts of record, the Board is of
the view that consummation would have some
negative effects with respect to considerations
specified in the Act, principally in terms of an
undue concentration of resources. Nevertheless,




75

the Board believes that such negative effects are
tempered somewhat by the large number of other
competitors that will remain after consummation
of the proposal. Moreover, when balanced against
the public benefits expected to result from this
transaction, the Board does not view the adverse
effects on competition referred to above or the
effects on the concentration of resources as being
so serious as to warrant denial of this proposal.
Affilication of AFSI with Applicant will provide
AFSI with access to Applicant's financial and
managerial resources and ensure the continued
availability of personal loans and related insurance
services to AFSI's customers at its present locations. The Board views this factor as particularly
significant in light of AFSI's reduction of its
overall operations in recent years, and the difficulty it has experienced in obtaining borrowed
funds at competitive rates. Furthermore, acquisition of AFSI by Applicant should enable AFSI
to become a more effective competitor in the areas
where it operates, and to provide its customers
with new and improved services. In particular,
upon consummation of the proposal, Applicant
intends to assist AFSI to offer its customers larger
loans, loans with extended maturities, and reductions in the rate of interest on some loans. In
addition, Applicant has stated that following consummation of the proposal AFSI will offer at
reduced premiums the several types of credit insurance policies that it will underwrite. 12 Since
Applicant proposes to sell credit life and credit
accident and health insurance underwritten by
AFSI in each of the states in which AFSI operates,
Applicant's proposed rate reductions vary according to the permissible rate structures in each respective state, and involves rate reductions for
reducing-term single and joint credit life insurance
at premium rates ranging from 2 percent to 15

12
With respect to underwriting credit life and credit accident
and health insurance, which is generally made available by
banks and other lenders and is designed to assure repayment
of a loan in the event of death or disability of the borrower,
the Board has stated:
To assure that engaging in the underwriting of
credit life and credit accident and health insurance can reasonably be expected to be in the
public interest, the Board will only approve
applications in which an applicant demonstrates
that approval will benefit the consumer or result
in other public benefits. Normally, such a
showing would be made by a projected reduction in rates or increase in policy benefits due
to bank holding company performance of this
service. (12 C . F . R . § 225.4(a)(10) n. 7 . )

A 76

Federal Reserve Bulletin • January 1979

percent below the rates presently charged in each
of the respective states.
On the basis of these and other facts of record
the Board concludes that the benefits to the public
that would result from Applicant's acquisition of
AFSI, including the reductions in insurance premiums that Applicant proposes to establish, are
sufficient to outweigh the slightly adverse effects
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
practices any or other effects that would be adverse
to the public interest.
Based upon the foregoing and other considerations reflected in the record, the Board has
determined that the balance of the public interest
factors the Board is required to consider under
section 4(c)(8) is favorable. Accordingly, the application is hereby approved, subject to the conditions that: (1) following consummation of the
proposed acquisition, AFSI discontinue certain
impermissible insurance underwriting and agency
activities in which AFSI is presently engaged; (2)
within one year of the date of this Order, AFSI
divest all of those offices of AFSI at which there
is existing competition with SPFC, other than
those Colorado industrial bank offices located in
Denver and Colorado Springs, Colorado; and, (3)
AFSI maintain on a continuing basis the public
benefits that the Board has found to be reasonably
expected to result from this proposal with regard
to insurance underwriting activities. In accomplishing the divestiture of AFSI's offices, Applicant is required to submit its plan for disposing
of such offices to the Board within six months and,
if deemed appropriate to ensure divestiture, Applicant may be required to transfer the offices
irrevocably to an independent trustee who shall
have the duty gf divesting the offices within the
one year period. This determination is also subject
to the conditions set forth in § 225.4(c) of Regulation Y and to the Board's authority to require
such modification or termination of the activities
of a holding company or any of its subsidiaries
as the Board finds necessary to assure compliance
with the provisions and purposes of the Act and
the Board's regulations and orders issued
thereunder, or to prevent evasion thereof. The
transaction shall be made not later than three
months after the effective date of this Order, unless
such period is extended for good cause by the
Board or by the Federal Reserve Bank of San




Francisco, pursuant to authority hereby delegated.
By order of the Board of Governors, effective
December 8, 1978.
Voting for this action: Chairman Miller and Governors Wallich, Coldwell, Partee, and Teeters.

[SEAL]

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

The Wachovia Corporation,
Winston-Salem, North Carolina
Order Approving
Retention of Wachovia Mortgage

Company

The Wachovia Corporation, Winston-Salem,
North Carolina, a bank holding company within
the meaning of the Bank Holding Company Act,
has applied for the Board's approval, under
§ 4(c)(8) of the Act (12 U.S.C. § 1843(c)(8)) and
§ 225.4(b)(2) of the Board's Regulation Y (12
C.F.R. § 225.4(b)(2)), to retain Wachovia Mortgage Company, Winston-Salem, North Carolina
("Company"), a company that engages in the
activities of providing mortgage banking services,
acting as adviser to a real estate investment trust,
acting as general partner in two apartment projects
constructed and operated under section 236 of the
National Housing Act, and acting as agent for
credit-related life, accident, health, and property
and casualty insurance. Such activities have been
determined by the Board to be closely related to
banking (12 C.F.R. § 225.4(a)(1), (5), (7), and
(9)).
Notice of the application, affording opportunity
for interested persons to submit comments and
views on the public interest factors, has been duly
published (43 Federal Register 33324). The time
for filing comments and views has expired, and
the Board has considered the application and all
comments received in the light of the public interest factors set forth in § 4(c)(8) of the Act (12
U.S.C. § 1843(c)(8)).
Applicant, a one-bank holding company, became a bank holding company as a result of the
1970 Amendments to the Act by virtue of its
control of Wachovia Bank and Trust Company,
Winston-Salem, North Carolina ("Bank"). Applicant is the largest banking organization in the
State of North Carolina with total deposits of
approximately $2.9 billion, representing 20.3 percent of total deposits in commercial banks in the

Law Department

State.1 Applicant established Company as a
wholly-owned subsidiary in November 1968. Pursuant to the provisions of section 4 of the Act,
Applicant has until December 31, 1980, to divest
its interest in Company or, in the alternative, to
apply and secure the Board's approval to retain
such interest.2 In addition to Bank and Company,
Applicant owns a data-processing subsidiary, Wachovia Services, Inc.
The Board regards the standards under section
4(c)(8) of the Act for retention of shares to be
the same as the standards for a proposed organization. Company was established by Applicant in
1968 and acquired from Bank ten mortgage loan
production offices in North Carolina and Bank's
FHA and VA residential property loan portfolio.
In 1969 Company acquired National Home Loans,
Inc., Atlanta, Georgia, with offices in Atlanta,
Georgia, and Pensacola, Florida, where Applicant
was not previously represented. Company later
established offices de novo in Columbia and
Charleston, South Carolina. Besides its four outof-state offices, Company currently operates in
eight distinct market areas in North Carolina. 3
Inasmuch as Company was established de novo
by Applicant, it does not appear that Applicant's
acquisition of Company in 1968 had any adverse
effect on competition in any relevant area.
Company is the forty-sixth largest mortgage
company in the nation, with a servicing volume
of $911 million (as of December 31, 1977). In
1977 approximately 75 percent of Company's
loans were 1-4 family residential loans, and 95
percent of these loans were FHA or VA loans.
Bank does not make residential loans of this type,
although it does engage in mortgage lending on
commercial property. However, the combined
volume of such commercial property lending by
Bank and Company is estimated not to exceed 5
percent of the total volume of such lending in any
relevant market where both Bank and Company
operate. Furthermore, Applicant's total volume of
mortgages of all types in 1977 represented a small
percentage of the total volume of mortgages in
most of the North Carolina markets where Appli1

Banking data are as of December 31, 1977.
Section 4 of the Act provides, inter alia, that nonbanking
activities acquired between June 30, 1968, and December 31,
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 S M S A , the Charlotte-Gastonia S M S A , the Greensboro-Winston-Salem-High
Point S M S A , the Raleigh-Durham S M S A , the Wilmington
S M S A , the Onslow County market, and the Pitt County market, all in North Carolina.
2




77

cant is represented. Accordingly, in view of the
slight overlap in the types of mortgages originated
by Bank and Company and the market shares held
by Bank and Company, Applicant cannot be regarded as dominant in the mortgage lending market in any relevant area. The Board concludes,
based on all the facts of record, that no anticompetitive effects have resulted from Applicant's use
of Company as a vehicle for de novo expansion
of its mortgage lending activities in North Carolina. Accordingly, the competitive effects of the
subject proposal are regarded as consistent with
approval.
It appears that Applicant's expansion of Company beyond the State of North Carolina has had
procompetitive effects by providing alternative
sources of mortgage lending to consumers. In
addition, Applicant has, through Company, increased the variety and availability in various
markets of mortgage services for consumers.
These benefits to the public are consistent with
approval of the subject application.
There is no evidence in the record indicating
that the proposal would result in undue concentration of resources, unfair competition, conflicts of
interests, unsound banking practices or other adverse effects.
Based upon the foregoing and other considerations reflected in the record, the Board has
determined that the balance of the public interest
factors the Board is required to consider under
§ 4(c)(8) is favorable. Accordingly, the application is hereby approved. This determination is
subject to the conditions set forth in § 225.4(c)
of Regulation Y and to the Board's authority to
require such modification or termination of the
activities of a holding company or any of its
subsidiaries as the Board finds necessary to assure
compliance with the provisions and purposes of
the Act and the Board's regulations and orders
issued thereunder, or to prevent evasion thereof.
By order of the Board of Governors, effective
December 27, 1978.

Voting for this action: Governors Wallich, Coldwell,
Partee, and Teeters. Absent and not voting: Chairman
Miller.

(Signed)
[SEAL]

GRIFFITH

L.

GARWOOD,

Deputy Secretary of the Board.

78

Federal Reserve Bulletin • January 1979

Certifications Under the
Bank Holding Company Tax Act of 1976
Ellingson Corporation,
Kenyon, Minnesota
Prior Certification Pursuant to the Bank
Company Tax Act of 1976
[Docket No. TCR

Holding

76-156]

Ellingson Corporation, Kenyon, Minnesota
("Ellingson ') has requested a prior certification
pursuant to section 1101(b)(1) of the Internal
Revenue Code ("Code"), as amended by section
2(a) of the Bank Holding Company Tax Act of
1976, that its proposed divestiture of all of the
606 shares presently held by Ellingson of Security
State Bank, Kenyon, Minnesota ("Bank"),
through the distribution of such shares to the two
shareholders of Ellingson, is necessary or appropriate to effectuate the policies of the Bank Holding Company Act (12 U.S.C. § 1841 et seq.)
("BHC Act").
In connection with this request, the following
information is deemed relevant for purposes of
issuing the requested certification:1
1. Ellingson is a corporation organized under
the laws of the State of Minnesota on December
8, 1959, under the name Security Agency, Inc.
On April 23, 1970, Security Agency, Inc. changed
its name to Ellingson Corporation.
2. On July 7, 1970, Ellingson acquired ownership and control of 600 shares, representing 60
percent of the outstanding voting shares of Bank.
Prior to July 7, 1970, Ellingson owned 6 shares
of Bank. Ellingson presently owns and controls
606 shares, representing 60.6 percent of the outstanding voting shares of Bank.
3. Ellingson became a bank holding company
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.
4. Ellingson would have been a bank holding
company on July 7, 1970 if the BHC Act Amendments of 1970 had been in effect on that date by

virtue of its ownership of more than 25 percent
of the outstanding voting shares of Bank.
5. Ellingson holds property acquired by it on
or before July 7, 1970, the disposition of which
would be necessary or appropriate to effectuate
section 4 of the BHC Act if Agency were to
continue to be a bank holding company beyond
December 31, 1980, which property is "prohibited
property" within the meaning of section 1103(c)
of the Code.
On the basis of the foregoing information, it
is hereby certified that:
(A) Ellingson is a qualified bank holding corporation, within the meaning of section 1103(b)
of the Code, and satisfies the requirements of that
section;
(B) the 606 shares of Bank that Ellingson proposes to distribute to its shareholders are all or
part of the property by reason of which Ellingson
controls (within the meaning of section 2(a) of the
BHC Act) a bank or bank holding company; and
(C) the distribution of the 606 shares of Bank
is necessary or appropriate to effectuate the policies of the BHC Act.
This certification is based upon the representations made to the Board by Ellingson and
upon the facts set forth above. In the event the
Board should hereafter determine that facts material to this certification are otherwise than as represented by Ellingson, or that Ellingson has failed
to disclose to the Board other material facts, it
may revoke this certification.
By order of the Board of Governors, acting
through its General Counsel, pursuant to delegated
authority, (12 C.F.R. § 265.2(b)(3)), effective
December 20, 1978.

[SEAL]

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

First Missouri Banks, Inc.,
Creve Coeur, Missouri
Prior Certification Pursuant to the Bank
Company Tax Act of 1976
[Docket No. TCR

1
This information derives from Ellingson's correspondence
with the Board concerning its request for this certification,
Ellingson's Registration Statement filed with the Board pursuant to the BHC Act, and other records of the Board.




Holding

76-106(b)]

First Missouri Banks, Inc., Creve Coeur, Missouri ("First Missouri"), has requested a prior
certification pursuant to § 1101(c)(2) of the Inter-

Law Department

nal Revenue Code (the "Code"), as amended by
§ 3(a) of the Bank Holding Company Tax Act of
1976 (the "Tax Act"), that the proposed distribution by First Missouri to its shareholders of
shares of a new corporation to be known as
Properties One, Inc. ("New Corp"), to be formed
to acquire 9 acres of real property now held by
First Properties, Inc. ("Properties"), a subsidiary
of First Missouri, is necessary or appropriate to
effectuate § 4 of the Bank Holding Company Act
(12 U.S.C. § 1843) ("BHC Act").
In connection with this request, the following
is deemed relevant for purposes of issuing the
requested certification:1
1. First Missouri is a corporation organized
under the laws of the State of Missouri on November 24, 1969. Properties is a corporation organized under the laws of the State of Missouri
on May 7, 1970. On May 8, 1970, First Missouri
acquired ownership and control of 500 shares,
representing 100 percent of the outstanding voting
shares, of Properties.
2. On May 7, 1970, First Missouri acquired
ownership and control of 13,178 shares, representing 87.1 percent of the outstanding voting
shares, of Creve Coeur Bank & Trust Company,
Creve Coeur, Missouri ("Bank"), 2 and thereby,
on the same date, acquired indirect ownership and
control of Olive Boulevard Corporation, Creve
Coeur, Missouri ("Olive"), a subsidiary of Bank.
On May 8, 1970, Olive was merged into Properties.
3. First Missouri became a bank holding company 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 August 24, 1971. First Missouri would have
been a bank holding company on July 7, 1970,
if the BHC Act Amendments of 1970 had been
in effect on such date, by virtue of its ownership
and control on that date of more than 25 percent
of the outstanding voting shares of Bank. First
Missouri currently owns and controls 87.1 percent
of the oustanding voting shares of Bank.
4. Properties owns nine acres of real property

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.
2
The name of Bank has since been changed to First Missouri Bank of Creve Coeur, Creve Coeur, Missouri.




79

located on Lot 2 of the Lake House Farm Subdivision in Section 3, Township 45 North, Range
5 East, City of Creve Coeur, St. Louis County,
Missouri. The nine acres were acquired by Olive
in 1963, and First Missouri acquired indirect
ownership and control of the nine acres on May
7, 1970, as a result of First Missouri's acquisition
of Bank. The disposition of the nine acres would
be necessary or appropriate to effectuate section
4 of the BHC Act if First Missouri were to continue to be a bank holding company beyond December 31, 1980.
5. First Missouri proposes to organize New
Corp for the sole purpose of receiving the nine
acres of real property from Properties. After the
transfer of the nine acres to New Corp, the shares
of New Corp will be distributed pro rata to the
common shareholders of First Missouri.
6. First Missouri has committed to the Board
that New Corp will have no directors or officers
in common with First Missouri or any subsidiary
of First Missouri.
On the basis of the foregoing information, it
is hereby certified that:
(A) First Missouri is a qualified bank holding
corporation, within the meaning of § 1103(b) of
the Code, and satisfies the requirements of that
subsection;
(B) the nine acres of real property proposed to
be divested is "prohibited property" within the
meaning of § 1103(c) of the Code; and
(C) the exchange of the nine acres of real property for shares of New Corp and the distribution
of such shares is necessary or appropriate to effectuate § 4 of the BHC Act.
This certification is based upon the representations made to the Board by First Missouri
and upon the facts set forth above. In the event
that the Board should hereafter determine that facts
material to this certification are otherwise than as
represented by First Missouri, or that First Missouri has failed to disclose to the Board other
material facts, it may revoke this certification.
By order of the Board of Governors of the
Federal Reserve System, acting through its General Counsel pursuant to delegated authority (12
C.F.R. § 265.2(b)(3)), effective December 21,
1978.

(Signed)
[SEAL]

GRIFFITH

L.

GARWOOD,

Deputy Secretary of the Board.

A 80

Federal Reserve Bulletin • January 1979

Hansen-Lawrence Agency, Inc.,
Worden, Montana
Prior Certification Pursuant to the Bank
Company Tax Act of 1976

Holding

[Docket No. TCR 76-166]
Hansen-Lawrence Agency, Inc., Worden,
Montana ("Agency"), has requested a prior certification pursuant to section 1101(c) of the Internal
Revenue Code (the "Code"), as amended by
section 2(a) of the Bank Holding Company Tax
Act of 1976 (the "Tax Act"), that Agency's
proposed distribution pro rata to its shareholders
of all of its right, title, and interest in certain real
estate and the improvements thereon ("Real Property"), is necessary or appropriate to effectuate
section 4 of the Bank Holding Company Act (12
U.S.C. § 1843 et seq.) ("BHC Act").
In connection with this request, the following
information is deemed relevant for purposes of
issuing the requested certification:1
1. Agency is a corporation organized on June
23, 1965, under the laws of the State of Montana.
2. On October 19, 1965, Agency acquired
ownership and control of 480 shares, representing
48 percent of the outstanding voting shares, of
Farmers State Bank of Worden, Worden, Montana
("Bank").
3. Agency became a bank holding company 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 July 12, 1971. Agency would have been a bank
holding company on July 7, 1970, if the BHC
Act Amendments of 1970 had been in effect on
such date, by virtue of its ownership and control
on that date of more than 25 percent of the voting
shares of Bank. Agency currently owns and controls 48 percent of the outstanding voting shares
of Bank.
4. Agency acquired certain agricultural Real
Property on October 25, 1968, and has owned such
property continuously since that time. Such property is described as: Township 3 North, Range
29 East, of the Principle Meridian, Yellowstone
County, Montana, Section 20: Farm Unit " C "
described as Lot 7, Farm Unit " G " described as
1
This information derives from A g e n c y ' s correspondence
with the Board concerning its request for this certification,
A g e n c y ' s Registration Statement filed with the Board pursuant
to the B H C Act, and other records of the Board.




NE y4 SW y4, Farm Unit " H " described as NW
l
A SW lA. The disposition by Agency of its interest
in this Real Property would be necessary or appropriate to effectuate section 4 of the BHC Act
if Agency were to continue to be a bank holding
company beyond December 31, 1980.
On the basis of the foregoing information it is
hereby certified that:
(A) Agency is a qualified bank holding corporation, within the meaning of subsection (b) of
section 1103 of the Code, and satisfies the requirements of that subsection;
(B) the Real Property described herein is "prohibited property" within the meaning of section
1103(c) of the Code; and
(C) the distribution by Agency of all of its right,
title, and interest in the Real Property described
herein is necessary or appropriate to effectuate
section 4 of the BHC Act.
This certification is based upon the representations made to the Board by Agency and upon
the facts set forth above. In the event the Board
should hereafter determine that facts material to
this certification are otherwise than as represented
by Agency, or that Agency has failed to disclose
to the Board other material facts, it may revoke
this certification.
By order of the Board of Governors, acting
through its General Counsel, pursuant to delegated
authority (12 C.F.R. § 265.2(b)(3)), effective December 28, 1978.

[SEAL]

(Signed) G R I F F I T H L. G A R W O O D ,
Deputy Secretary of the Board.

The Jacobus Company,
Wauwatosa, Wisconsin
Final Certification Pursuant to the Bank Holding
Company Tax Act of 1976
[Docket No. TCR 76-138]
The Jacobus Company, Wauwatosa, Wisconsin
("Jacobus"), has requested a final certification
pursuant to § 1101(e) of the Internal Revenue
Code (the "Code"), as amended by § 2(a) of the
Bank Holding Company Tax Act of 1976 (the
"Tax Act"), that it has (before the expiration of
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
bank holding company) ceased to be a bank holding company.

Law Department

In connection with this request, the following
information is deemed relevant, for purposes of
issuing the requested certification: 1
1. Effective November 10, 1977, the Board
issued a prior certification pursuant to section
1101(b) of the Code with respect to the proposed
divestiture by Jacobus of all of the 340,983 shares
of common stock (the "Inland Shares") of Inland
Heritage Corporation, (formerly Inland Financial
Corporation) Milwaukee, Wisconsin ("Inland"),
presently held by Jacobus, through the pro rata
distribution of such shares to the holders of common stock of Jacobus.
The Board's Order certified that:
(A) Jacobus is a qualified bank holding corporation, within the meaning of subsection (b) of
section 1103 of the Code, and satisfies the requirements of that subsection;
(B) the shares of Inland that Jacobus proposes
to distribute to its shareholders are all of the
property by reason of which Jacobus controls
(within the meaning of § 2(a) of the BHC Act)
a bank or a bank holding company; and
(C) the distribution of such shares is necessary
or appropriate to effectuate the policies of the BHC
Act.
2. On November 16, 1977, Jacobus distributed
to its shareholders, on a pro rata basis, a total
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
Inland.
3. The prior certification issued on November
10, 1977 was granted upon the condition that no
person holding an office or position (including an
advisory or honorary position) with Jacobus or any
of its subsidiaries as a director, policy-making
employee or consultant, or who performs (directly,
or through an agent, representative or nominee)
functions comparable to those normally associated
with such office or position, will hold any such
office or position or perform any such function
with Inland or any of its subsidiaries. Effective
July 28, 1978, all such interlocking relationships
between Jacobus and Inland, and their respective
subsidiaries, were terminated.
4. Jacobus does not directly or indirectly own,
control or have power to vote 25 percent or more
of any class of voting securities of any bank or
any company that controls a bank.
1
This information derives from Jacobus' correspondence
with the Board concerning its request for this certification,
Jacobus' and Inland's Registration Statements filed with the
Board pursuant to the B H C Act, and other records of the Board.




81

5. Jacobus has represented that it does not control in any manner the election of a majority of
directors, or exercise a controlling influence over
the management or policies of Inland or any bank
or any other company that controls a bank.
On the basis of the foregoing information, it
is hereby certified that Jacobus has (before the
expiration of the period prohibited property is
permitted under the BHC Act to be held by a bank
holding company) ceased to be a bank holding
company.
This certification is based upon the representations and commitments made to the Board
by Jacobus and upon the facts set forth above.
In the event the Board should determine that facts
material to this certification are otherwise than as
represented by Jacobus, or that Jacobus has failed
to disclose to the Board other material facts or
to fulfill any commitments made to the Board in
connection herewith, it may revoke this certification.
By order of the Board of Governors, acting
through its General Counsel, pursuant to delegated
authority (12 C.F.R. 265.2(b)(3)), effective December 27, 1978.

[SEAL]

The Jacobus

(Signed) G R I F F I T H L . G A R W O O D ,
Deputy Secretary of the Board.

Company

The Jacobus Company, Wauwatosa, Wisconsin
("Jacobus"), a bank holding company within the
meaning of § 2(a) of the Bank Holding Company
Act of 1956, as amended (12 U.S.C. § 1841 et.
seq.) (the "Act"), has requested a determination,
pursuant to the provisions of section 2(g)(3) of
the Act (12 U.S.C. 1841(g)(3)), that with respect
to the distribution of 340,983 shares of common
stock of Inland Heritage Corporation, Milwaukee,
Wisconsin ("Inland"), to the shareholders of Jacobus, Jacobus is not capable of controlling Inland
notwithstanding the fact that on the date of such
distribution Jacobus had directors and officers in
common with Inland and its subsidiaries.
Under the provision of section 2(g)(3) of the
Act, shares transferred after January 1, 1966, by
any bank holding company to a transferee that has
directors or officers in common with the transferor
are deemed to be indirectly owned or controlled
by the transferor unless the Board, after opportunity for hearing, determines that the transferor is
not in fact capable of controlling the transferee.

82

Federal Reserve Bulletin • January 1979

Jacobus has submitted to the Board evidence
to show that it no longer has directors and officers
in common with Inland and is not in fact capable
of controlling Inland. This determination is based
upon the evidence of record in this matter, in
particular the following facts.
On November 16, 1978 Jacobus distributed to
its shareholders, on a pro rata basis, the 340,983
shares of Inland common stock held by Jacobus.
On that date three of Jacobus' directors and officers were also directors and officers of Inland and
several of its subsidiaries. Effective April 25 and
April 30, 1978, two of the directors and officers
of Jacobus terminated their positions with Inland
and its subsidiaries, respectively. On July 28,
1978, the third common director and officer of
Jacobus and Inland terminated all of his positions
with Jacobus and its subsidiaries. Thus, on July
28, 1978, Jacobus and Inland did not have any
directors and officers in common. Further, Jacobus
and Inland have committed to the Board that no
person holding an office or position (including an
advisory or honorary position) with Jacobus or any
of its subsidiaries as a director, policy-making
employee or consultant, or who performs (directly,
or through an agent, representative or nominee)
functions comparable to those normally associated
with such office or position, will hold any such
office or position or perform any such function
with Inland or any of its subsidiaries.
Accordingly, it is ordered, that the request of
Jacobus for a determination pursuant to section
2(g)(3) is granted. This determination is based on
representations and commitments made to the
Board by Jacobus, Inland and the individuals involved. In the event that the Board should
hereafter determine that facts material to this determination are otherwise than as represented, or
that Jacobus, Inland or the individuals have failed
to disclose to the Board other material facts, this
determination may be revoked, and any change
in the facts and circumstances relied upon by the
Board in making this determination would result
in the Board reconsidering the determination made
herein.
By order of the Board of Governors, acting
through its General Counsel, pursuant to delegated
authority (12 C.F.R. 265.2(b)(1)), effective December 27, 1978.

signed)
[SEAL]




GRIFFITH L .

GARWOOD,

Deputy Secretary of the Board.

Sapp Insurance Agency, Inc.,
Esbon, Kansas
Prior Certification Pursuant to the Bank Holding
Company Tax Act of 1976
[Docket No. TCR 76-154]
Sapp Insurance Agency, Inc., Esbon, Kansas
("Agency"), has requested a prior certification
pursuant to section 1101(b) of the Internal Revenue Code ("Code"), as amended by section 2(a)
of the Bank Holding Company Tax Act of 1976,
that its proposed divestiture of all the 375 shares
of Esbon State Bank, Esbon, Kansas ("Bank 1 1 ),
presently held by Agency through the pro rata
distribution of such shares to the two shareholders
of Agency, is necessary or appropriate to effectuate the policies of the Bank Holding Company Act
(12 U.S.C. § 1841 et seq.) ("BHC Act").
In connection with this request, the following
information is deemed relevant for purposes of
issuing the requested certification:1
1. Agency is a corporation organized under the
laws of the State of Kansas on January 1, 1969.
2. On April 1, 1969, Agency acquired ownership and control of 375 shares, representing 75
percent of the outstanding voting shares, of Bank.
Agency has continued to own and control 375
shares, representing 75 percent of the outstanding
voting shares of Bank since the acquisition of such
shares.
3. Agency became a bank holding company 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 30, 1971. Agency would have been a
bank holding company on July 7, 1970, if the BHC
Act Amendments of 1970 had been in effect on
such date by virtue of its ownership and control
on that date of more than 25 percent of the outstanding voting shares of Bank.
4. Agency holds property acquired by it on or
before July 7, 1970, the disposition of which
would be necessary or appropriate to effectuate
section 4 of the BHC Act if Agency were to
continue to be a bank holding company beyond
December 31, 1980, and which property, is "pro-

1
This information derives from Agency's correspondence
with the Board concerning its request for this certification,
Agency's Registration Statement filed with the Board pursuant
to the BHC Act, and other records of the Board.

Law Department

hibited property" within the meaning of section
1103(c) of the Code.
On the basis of the foregoing information, it
is hereby certified that:
(A) Agency is a qualified bank holding corporation, within the meaning of section 1103(b)
of the Code, and satisfies the requirements of that
section;
(B) the 375 shares of Bank that Agency proposes to distribute to its shareholders are all or
part of the property by reason of which Agency
controls (within the meaning of section 2(a) of the
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 policies of the BHC Act.

ORDERS

APPROVED

By the Board

UNDER

of

BANK

HOLDING

COMPANY

83

This certification is based upon the representations made to the Board by Agency and upon
the facts set forth above. In the event the Board
should hereafter determine that facts material to
this certification are otherwise than as represented
by Agency, or that Agency has failed to disclose
to the Board other material facts, it may revoke
this certification.
By order of the Board of Governors, acting
through its General Counsel, pursuant to delegated
authority, (12 C.F.R. § 265.2(b)(3)), effective
December 11, 1978.

(Signed)

THEODORE

Secretary

[SEAL]

E. A L L I S O N ,
of the Board.

ACT

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

Applicant

Bank(s)

Ankeny Bancshares, Inc.,
Ankeny, Iowa
First Financial Bancshares,
Inc., Nevada, Missouri
Southwest Florida Banks, Inc.
Fort Meyers, Florida

By Federal

Reserve

Board action
(effective
date)

Ankeny National Bank,
Ankeny, Iowa
The First National Bank
of Mount Vernon,
Mount Vernon, Missouri
Charlotte County National
Bank, Charlotte County,
Florida

December 27, 1978
December 27, 1978

December 7, 1978

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

Applicant
Northwest Ohio Bancshares,
Inc., Toledo, Ohio




Bank(s)
National Bank of Paulding,
Paulding, Ohio

Reserve
Bank

Effective
date

Cleveland

December 19, 1978

A 84

Federal Reserve Bulletin • January 1979

Section 4
Nonbanking
company
(or activity)

Applicant
Mercantile Bancorporation, Inc.,
St. Louis, Missouri

PENDING

CASES

INVOLVING

90 percent of the
gross loan receivables of
Financial Loan and
Investment Co., Tulsa,
Oklahoma

THE BOARD

OF

Reserve
Bank

Effective
date

St. Louis

December 5, 1978

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.
William Miller, et al., filed December 1978,
U.S.D.C. for the District of Columbia.
Commercial National Bank, et al., v. Board of
Governors, filed December 1978, U.S.C.A. for
the District of Columbia.
Ella Jackson et al. v. Board of Governors, filed
November 1978, U.S.C.A. for the Fifth Circuit.
United Bank Corporation, New York v. Board
of Governors, filed November 1978, U.S.C.A.
for the Second Circuit.
Metro-North State Bank, Kansas City v. Board
of Governors, filed October 1978, U.S.C.A. for
the Eighth Circuit.
Manchester-Tower
Grove Community
Organization/ACORN
v. Board of Governors, filed
September 1978, U.S.C.A. for the District of
Columbia.
Beckley v. Board of Governors, filed July 1978,
U.S.D.C. for the Northern District of Illinois.
Independent Bankers Association of Texas v. First
National Bank in Dallas, et al., filed July 1978,
U.S.C.A. for the Northern District of Texas.
Mid-Nebraska Bancshares, Inc. v. Board of Governors, filed July 1978, U.S.C.A. for the District of Columbia.
NCNB Corporation v. Board of Governors, filed
June 1978, U.S.C.A. for the Fourth Circuit.
NCNB Corporation v. Board of Governors, filed
June 1978, U.S.C.A. for the Fourth Circuit.
Ellis Banking Corporation v. Board of Governors,
filed May 1978, U.S.C.A. for the Fifth Circuit.




United States League of Savings Associations v.
Board of Governors, filed May 1978, U.S.D.C.
for the District of Columbia.
Hawkeye Bancorporation v. Board of Governors,
filed April 1978, U.S.C.A. for the Eighth Circuit.
Citicorp v. Board of Governors, filed March 1978,
U.S.C.A. for the Second Circuit.
Security Bancorp and Security National Bank v.
Board
of Governors, filed March 1978,
U.S.C.A. for the Ninth Circuit.
Michigan National Corporation v. Board of Governors, filed January 1978, U.S.C.A. for the
Sixth Circuit.
Wisconsin Bankers Association v. Board of Governors, filed January 1978, U.S.C.A. for the
District of Columbia.
Vickars-Henry Corp. v. Board of Governors, filed
December 1977, U.S.C.A. for the Ninth Circuit.
Emch v. The United States of America, et al.,
filed November 1977, U.S.D.C. for the Eastern
District of Wisconsin.
Corbin v. Federal Reserve Bank of New York,
Board of Governors, et al., filed October 1977,
U.S.D.C. for the Southern District of New
York.
Central Bank v. Board of Governors, filed October 1977, U.S.C.A. for the District of Columbia.
Investment Company Institute v. Board of Governors, filed September 1977, U.S.D.C. for the
District of Columbia.

Law Department

BankAmerica
Corporation v. Board of Governors, filed May 1977, U . S . D . C . for the Northern District of California.
BankAmerica
Corporation v. Board of Governors, filed May 1977, U . S . C . A . for the Ninth
Circuit.
National Automobile Dealers Association, Inc. v.
Board of Governors, filed November 1976,
U . S . C . A . for the District of Columbia.
Memphis Trust Company v. Board of Governors,
filed February 1976, U . S . D . C . for the Western
District of Tennessee.
First Lincolnwood Corporation v. Board of Governors, filed February 1976, U.S.C.A. for the
Seventh Circuit.




85

Robert Farms, Inc. v. Comptroller of the Currency, et al., filed November 1975, U . S . D . C .
for the Southern District of California.
Florida Association of Insurance Agents, Inc. v.
Board of Governors, and National
Association
of Insurance Agents, Inc. v. Board of Governors, filed August 1975, actions consolidated
in U . S . C . A . for the Fifth Circuit.
David R. Merrill, et al. v. Federal Open Market
Committee of the Federal Reserve System, filed
May 1975, U . S . D . C . for the District of Columbia.
Bankers Trust New York Corporation v. Board
of Governors, filed May 1973, U . S . C . A . for
the Second Circuit.

Al

Financial and Business Statistics
CONTENTS

Domestic

Financial

Statistics

WEEKLY

A3 Monetary aggregates and interest rates
A4 Factors affecting member bank reserves
A5 Reserves and borrowings of member
banks
A6 Federal funds transactions of money
market banks
POLICY

RESERVE

COMMERCIAL

BANKS

Assets and Liabilities o f —
A20
All reporting banks
A21
Banks in New York City
A22
Banks outside New York City
A23 Balance sheet memoranda
A24 Commercial and industrial loans
A25 Gross demand deposits of individuals,
partnerships, and corporations

INSTRUMENTS

A8 Federal Reserve Bank interest rates
A9 Member bank reserve requirements
A 1 0 Maximum interest rates payable on
time and savings deposits at federally
insured institutions
A 1 0 Margin requirements
A l l Federal Reserve open market
transactions
FEDERAL

REPORTING

BANKS

FINANCIAL

MARKETS

A25 Commercial paper and bankers
acceptances outstanding
A26 Prime rate charged by banks on
short-term business loans
A26 Terms of lending at commercial banks
All Interest rates in money and capital
markets
A28 Stock market—Selected statistics

A12 Condition and F.R. note statements
A13 Maturity distribution of loan and
security holdings

A29 Savings institutions—Selected assets
and liabilities

MONETARY

FEDERAL

AND

CREDIT

AGGREGATES

A13 Bank debits and deposit turnover
A14 Money stock measures and components
A15 Aggregate reserves and deposits of
member banks
A15 Loans and investments of all
commercial banks
COMMERCIAL

BANK

ASSETS

AND

LIABILITIES

A 1 6 Last-Wednesday-of-month series
A17 Call-date series
A18 Detailed balance sheet, June 30, 1978




FINANCE

A30 Federal fiscal and financing operations
A31 U.S. budget receipts and outlays
A32 Federal debt subject to statutory
limitation
A32 Gross public debt of U . S . Treasury—
Types and ownership
A33 U.S. government marketable
securities—Ownership, by maturity
A34 U.S. government securities dealersTransactions, positions, and financing
A35 Federal and federally sponsored credit
agencies—Debt outstanding

A2

Federal Reserve Bulletin • January 1979

SECURITIES

MARKETS

CORPORATE

International

AND

FINANCE

A36 New security issues—State and local
governments and corporations
A37 Open-end investment companies—Net
sales and asset position
A37 Corporate profits and their distribution
A38 Nonfinancial corporations—Assets and
liabilities
A38 Business expenditures on new plant
and equipment
A39 Domestic finance companies—Assets
and liabilities; business credit
REAL

ESTATE

A40 Mortgage markets
A41 Mortgage debt outstanding
CONSUMER INSTALLMENT

A54 U.S. international transactions—
Summary
A55 U.S. foreign trade
A55 U.S. reserve assets
A56 Foreign branches of U.S. banks—
Balance sheet data
A58 Selected U.S. liabilities to foreign
official institutions
REPORTED

BY BANKS

FUNDS

A44 Funds raised in U.S. credit markets
A45 Direct and indirect sources of funds to
credit markets

HOLDINGS

Nonfinancial

Statistics

A46 Nonfinancial business activity—
Selected measures
A46 Output, capacity, and capacity
utilization
A47 Labor force, employment, and
unemployment
A48 Industrial production—Indexes and
gross value
A50 Housing and construction
A51 Consumer and wholesale prices
A52 Gross national product and income
A53 Personal income and saving




STATES:

AND

TRANSACTIONS

A64 Marketable U.S. Treasury bonds and
notes—Foreign holdings and
transactions
A64 Foreign official assets held at F.R.
Banks
A65 Foreign transactions in securities
REPORTED

Domestic

UNITED

A59 Liabilities to foreigners
A61 Banks' own claims on foreigners
A62 Banks' own and domestic customers'
claims on foreigners
A63 Banks' own claims on unaffiliated
foreigners
A63 Liabilities to and claims on foreigners
SECURITIES

OF

IN THE

CREDIT

A42 Total outstanding and net change
A43 Extensions and liquidations
FLOW

Statistics

THE

BY

UNITED

NONBANKING

CONCERNS

STATES:

A66 Short-term liabilities to and claims on
foreigners
A67 Long-term liabilities to and claims on
foreigners
INTEREST

AND

EXCHANGE

RATES

A68 Discount rates of foreign central banks
A68 Foreign short-term interest rates

A69 Guide to Tabular
Presentation
and Statistical
Releases

IN

Domestic Financial Statistics
1.10

MONETARY

AGGREGATES

AND

INTEREST

A3

RATES
1978

1977

1978

Item
Q4

Q2

QL

Q3

July

Aug.

Sept.

Oct.

Nov.

Monetary and credit aggregates
(annual rates of change, seasonally adjusted in per cent) 1 2

1
2
3

Member bank reserves
Total
Required
Nonborrowed

4
5
6
7

8
9
10
11

6.3
6.4
3.8

8.8
9.3
14.4

6.6
7.2
1.1

8.2
8.2
6.2

14.0
13.4
7.6

-8.2
-7.4
-3.2

8.1
7.4
10.7

7.6
8.3
1.3

-5.3
-7.1
11.7

Concepts of money 1
M-l
M - l 4M-2
M-3

7.5
6.8
8.1
10.6

6.2
4.9
6.9
7.7

9.9
6.9
7.9
7.8

7.6
5.3
8.9
10.1

4.8
1.5
8.0
9.4

8.5
8.7
10.4
11.7

14.1
12.2
12.5
14.0

3.7
1.8
7.0
'9.6

-4.6
-7.1
4.3
6.7

Time and savings deposits
Commercial banks:
Total
Savings
Other time
Thrift institutions 2

13.0
5.4
11.6
14.4

12.8
2.6
11.4
8.9

10.1
1.6
10.5
7.6

9.5
1.3
17.3
11.6

10.2
-4.3
22.5
11.2

7.5
8.1
14.2
13.9

13.8
9.7
13.6
16.0

7.9
-1.6
17.7
'13.6

23.7
-11.3
27.7
9.9

10.1

'14.9

10.8

'11.0

'5.1

'9.7

'9.8

6.5

12 Total loans and investments at commercial banks 3

9.9

r

r

1978
QL

Q2

1978
Q3

Q4

Aug.

Sept.

Oct.

Nov.

Dec.

Interest rates (levels, per cent per annum)

13
14
15
16

Short-term rates
Federal funds 4
Federal Reserve discount 5
Treasury bills (3-month market yield) 6
Commercial paper (90- to 119-day) 6 - 7

6.76
6.46
6.39
6.76

7.28
6.78
6.48
7.16

8.09
7.50
7.31
8.03

9.58
9.09
8.57
9.83

8.04
7.43
7.08
7.83

8.45
7.83
7.85
8.39

8.96
8.26
7.99
8.98

9.76
9.50
8.64
10.14

10.03
9.50
9.08
10.37

17
18
19

Long-term rates
Bonds:
U.S. Government 8
State and local government 9
Aaa utility (new issue) 1 0

8.19
5.65
8.70

8.43
6.02
8.98

8.53
6.16
8.94

8.78
6.28
9.23

8.45
6.12
8.82

8.47
6.09
8.86

8.69
6.13
9.17

8.75
6.19
9.27

8.90
6.51
9.28

9.23

9.58

9.80

9.71

9.80

9.80

9.95

10.10

9.30

Conventional mortgages 1 1

20
1

M-l equals currency plus private demand deposits adjusted.
M-1 + equals M-l plus savings deposits at commercial banks, N O W
accounts at banks and thrift institutions, credit union share draft accounts, and demand deposits at mutual savings banks.
M-2 equals M-l plus bank time and savings deposits other than large
negotiable certificates of deposit (CD's).
M-3 equals M-2 plus deposits at mutual savings banks, savings and
loan associations, and credit union shares.
2
Savings and loan associations, mutual savings banks, and credit
unions.
3
Quarterly changes calculated from figures shown in Table 1.23.
4
Seven-day averages of daily effective rates (average of the rates on
a given date weighted by the volume of transactions at those rates).
5
Rate for the Federal Reserve Bank of New York.




6
7

Ouoted on a bank-discount basis.
Beginning Nov. 1977, unweighted average of offering rates quoted by
five dealers. Previously, most representative rate quoted by these dealers.
8
Market yields adjusted to a 20-year maturity by the U.S. Treasury.
9
Bond Buyer series for 20 issues of mixed quality.
10 Weighted averages of new publicly offered bonds rated Aaa, Aa,
and A by Moody's Investors Service and adjusted to an Aaa basis.
Federal Reserve compilations.
11
Average rates on new commitments for conventional first mortgages
on new homes in primary markets, unweighted and rounded to nearest
5 basis
points, from Dept. of Housing and Urban Development.
12
Unless otherwise noted, rates of change are calculated from average
amounts outstanding in preceding month or quarter.

A4

DomesticNonfinancialStatistics • January 1979

1.11 FACTORS AFFECTING MEMBER BANK RESERVES
Millions of dollars
Monthly averages of daily
figures

Weekly averages of daily figures for weeks ending—

1978

1978

Factors

Oct.

Nov.

Dec.0

Nov. 15

Nov. 22

Nov. 29

Dec. 6

Dec. 13

Dec. 20 p

Dec. 27?

133,273

129,544

129,428

126,996

130,417

130,654

129,443

125,697

129,704

131,385

115,008

111,243

109,255

109,186

110,556

111,842

111,442

107,597

109,902

107,835

113,977

110,728

108,780

109,186

109,689

111,336

110,600

107,572

109,798

107,375

1,031

515

475

867

506

842

25

104

SUPPLYING RESERVE F U N D S
Reserve Bank credit outstanding....

1
2
3
4

Bought outright
Held under repurchase agreement

5
6
7

Federal

agency

securities

Bought outright
Held under repurchase agree-

8
9
10
11

Loans
Float
Other Federal Reserve a s s e t s . . . .
Gold stock
Special Drawing Rights certificate
account
Treasury currency outstanding

12
13
14

460

8,353

8,109

8,089

7,932

8,343

8,060

8,164

7,912

7,942

8,212

7,940

7,928

7,897

7,932

7,932

7,918

7,899

7,898

7,896

7,896

413

181

192

411

142

265

14

46

316

249
1,261
5,742
2,660

180
722
6,588
2,702

167
874
7,521
3,522

633
6,176
3,068

455
604
8,269
2,190

141
792
7,554
2,265

258
698
6,468
2,413

37
591
7,006
2,554

6
567
7,383
3,904

110
1,413
9,342
4,473

11,660

11,645

11,635

11,642

11,642

11,642

11,642

11,639

11,611

11,628

1,300
11,725

1,300
11,779

1,300
11,827

1,300
11,768

1,300
11,787

1,300
11,803

1,300
11,805

1,300
11,822

1,300
11,822

1,300
11,844

108,872
303

110,929
278

113,395
261

110,775
278

111,242
279

111,913
273

112,061
272

112,862
271

113,329
261

114,377
245

14,948
300
590

8,186
289
540

3,931
301
724

8,092
273
521

6,443
286
529

6,468
298
556

5,299
308
618

2,120
266
731

3,748
292
666

4,952
320
620

ABSORBING RESERVE F U N D S
15
16

Currency in circulation
Treasury cash holdings
Deposits, other than member bank
reserves with F.R. Banks:
Treasury
Foreign
Other 2

17
18
19

Other F.R. liabilities and c a p i t a l . . . .
Member bank reserves with F.R.
Banks

20
21

4,244

4,193

4,322

4,008

4,284

4,475

4,303

4,069

4,367

4,548

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
Dec.f

Nov. 15

Nov. 22

Nov. 29

Dec. 6

Dec. 13

Dec. 20p

Dec. 27p

131,605

131,398

127,622

131,955

132,830

123,783

129,046

130,237

137,046

113,305

110,562

108,114

111,203

114,110

104,361

110,558

107,104

111,639

113,305

109,478

108,114

110,878

112,110

104,361

110,558

107,104

109,583

325

2,000

Oct.

Nov.

132,022
115,322

114,659

SIJPPT .YINC. RF.SF.RVE F U N D S
22

Reserve Bank credit outstanding. . . .

23
24
25

U.S. Government

securities1.

.....

Bought outright
Held under repurchase agree-

26
27
28

Bought outright
Held under repurchase agree-

29
30
31
32

Acceptances
Float
Other Federal Reserve a s s e t s . . . .

33
34

Gold stock
Special Drawing Rights certificate

35

Treasury currency outstanding.

1,084

663

2,056

8,065

7,899

8,029

7,932

8,092

8,524

7,899

7,896

7,896

9,165

7,938

7,899

7,896

7,932

7,932

7,899

7,899

7,896

7,896

7,896

127

133

160

625

236
1,207
4,436
2,756

813
7,238
2,350

587
1,172
6,505
4,543

1,258
8,042
2,276

383
933
9,146
2,198

370
1,270
6,151
2,405

586
8,473
2,464

7,619
2,501

502
10,393
4,342

444
3,111
8,066
4,621

11,655

11,642

11,671

11,642

11,642

11,642

11,640

11,635

11,611

11,671

1,300
11,731

1,300
11,790

1,300
11,846

1,300
11,778

1,300
11,799

1,300
11,804

1,300
11,810

1,300
11,822

1,300
11,822

1,300
11,846

109,307
276

112,072
267

114,648
250

111,277
277

111,820
275

112,327
273

112,729
271

113,477
271

114,075
250

115,227
241

15,467
305
531

6,587
379
567

4,196
368
1,256

7,557
313
448

6,153
285
565

7,236
275
479

2,169
367
553

1,869
204
582

4,500
275
582

3,540
285
613

1,269
472

ABSORBING RESERVE F U N D S
36
37
38
39
40
41
42

Currency in circulation
Deposits, other than member bank
reserves with F.R. Banks:
Treasury
Other 2
Other F.R. liabilities and capital. . .
Member bank reserves with F.R.
Banks

4,560

4,545

4,275

4,144

4,279

4,584

3,796

4,285

4,499

4,704

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
pledged with F.R. Banks—and excludes (if any) securities sold and scheduled to be bought back under matched sale-purchase transactions.
2 Includes certain deposits of foreign-owned banking institutions




voluntarily held with member banks and redeposited in full with Federal
Reserve Banks.
NOTE.—For amounts of currency and coin held as reserves, see Table
1.12.

Member Banks
1.12

RESERVES A N D BORROWINGS

A5

Member Banks

Millions of dollars
Monthly averages of daily figures
Reserve classification

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

27,057
9,351

27,776
9,028

27,890
9,151

27,840
9,345

28,570
9,542

28,079
9,512

28,010
9,605

28,701
9,654

29,853
9,794

31,256
10,337

36,471

36,880

37,119

37,262

38,189

37,666

37,689

38,434

39,728

41,669

36,297
174

36,816
64

36,867
252

37,125
137

38,049
140

37,404
262

37,614
75

38,222
212

39,423
305

41,487
182

558
54

539
43

1,227
93

1,111
120

1,286
143

1,147
188

1,068
191

1,261
221

722
185

874
134

Dec.

1
2
3

4
5
6
7

All member banks
Reserves:
At F.R. Banks
Currency and coin
Total held *

Required
Excess 1
Borrowings at F.R. Banks: 2
Total
Seasonal
Large banks in New York City

8

9
10
11

Reserves

held

Required
Excess
Borrowings 2
Large banks in Chicago

12

Reserves

13
14
15

Required
Excess
Borrowings 2

16

17
18
19

held

1978

1977

6,244

6,247

6,315

6,341

6,606

6,334

6,182

6,428

6,682

7,091

6,279
-35
48

6,320
-73
61

6,236
79
113

6,376
-35
54

6,581
25
129

6,290
44
58

6,251
-69
78

6,349
79
157

6,658
24
48

7,243
-152
99

1,593

1,670

1,697

1,668

1,708

1,648

1,655

1,672

1,791

1,870

1,613
-20
26

1,686
-16
11

1,669
28
19

1,670
-2
20

1,707

1,646
2
3

1,650
5
35

1,649
23
14

1,765
26
4

1,894
-24
9

20

Other large banks
Reserves

held

Required
Excess
Borrowings 2

Dec.f

13,993

14,135

14,106

14,250

14,553

14,502

14,564

14,862

15,547

16,393

13,931
62
243

14,077
58
249

14,079
27
500

14,225
25
536

14,569
-16
499

14,423
79
417

14,541
23
363

14,867
-5
408

15,447
100
194

16,335
58
275

14,641

14,828

15,001

15,003

15,322

15,182

15,288

15,472

15,708

15,991

14,474
167
241

14,733
95
218

14,883
118
595

14,854
149
501

15,192
130
638

15,045
137
669

15,172
116
592

15,357
115
682

15,553
155
476

16,015
-24
491

All other banks
20

Reserves

21
22
23

Required
Excess
Borrowings 2

held

Weekly averages of daily figures for weeks ending—
1978
Oct. 25
All member banks
Reserves:
At F.R. Banks
Currency and coin
Total held1

Required
Excess 1
Borrowings at F.R. Banks: 2
Total
Seasonal
Large banks in New York City
31

Reserves

32
33
34

Required
Excess
Borrowings 2

held

Nov. 1

Nov. 8

Nov. 15

held

Required
Excess
Borrowings 2

Dec. 6

Dec. 13

Dec. 20p

28,887
9,101

28,467
9,861

27,777
10,071

27,759
10,132

32,085
9,144

31,416
9,785

31,328
10,056

30,139
10,843

31,775
10,025

38,068

38,408

37,927

37,974

41,312

41,283

41,465

41,063

41,873

37,749
319

38,295
113

37,586
341

37,729
245

41,162
150

41,130
153

41,138
327

40,911
152

41,808
65

1,313
235

1,305
233

696
191

633
188

604
182

792
180

698
150

591
131

567
131

6,100
6,026
74
75

6,286
6,313
-27
99

6,240

6,222
6,257
-35
102

7,170

6,968

7,300

7,339

7,162
8
4

6,980

7,236
64

7,300
39

1,569

1.659

1,621

1,605

1,997

1,603
18
9

1,587
18

1,985
12

1,886
1,881

Large banks in Chicago
Reserves

Nov. 29

1,569
12

1.660
10

6,199
41

-12

31

5
6

2

1,891

1,862

,904

1,913

1,867
-5
10

,937
-33
6

-22

Other large banks
39

Reserves

40
41
42

Required
Excess
Borrowings 2 ....

held...

14,868

14,888

14,738
130
428

14,877

15,531

15,575

15,416
115
798

15,445
130
847

349

14,812

16,136

16,323

16,337

16,145
-9

16,255
68
236

16,206
16,093
113
176

16,174

14,758
54
137

16,133
41
193

16,378
-41
106

15,326

15,335

16,009

15,870
139
429

16,068
15,896
172
522

15,942

15.127

16,106
16,014
92
519

15,905

15,163
163
496

15,781
124
388

16,193
-251
455

14,740

14,621
119
191

169

All other banks
43

Reserves

44
45
46

Required...
Excess
Borrowings 2 . .

held.

l Adjusted to include waivers of penalties for reserve deficiencies in
accordance with Board policy, effective Nov. 19, 1975, of permitting
transitional relief on a graduated basis over a 24-month period when a
nonmember bank merges into an existing member bank, or when a




'208

394

nonmember bank joins the Federal Reserve System. For weeks for which
figures are preliminary, figures by class of bank do not add to total
because adjusted data by class are not available.
2
Based on closing figures.

A6

DomesticNonfinancialStatistics • 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

1

Basic reserve position
Excess reserves1

16

111

141

-31

75

169

127

166

205

59

106

38

168

62

81

1

590

14,187

17,146

17,945

16,936

15,861

15,823

17,468

15,421

15,136

-14,376

-17,094

-17,910

-17,004

-15,954

-15,716

-17,422

-15,256

-15,765

-40

LESS:

2
3

Borrowings at F.R. Banks. .
Net interbank federal funds
transactions
EQUALS: N e t s u r p l u s , o r

4
5

deficit ( - ) :
Amount
Percent of average
reserves

required

Interbank federal funds transactions
Gross transactions:
Purchases
Sales
Two-way transactions2
Net transactions:
Purchases of net buying banks..
Sales of net selling banks

11
12
13

Related transactions with U.S.
government securities dealers
Loans to dealers3
Borrowing from dealers 4
Net loans

89.5

108.6

113.0

94.7

90.0

87.7

97.7

83.7

88.1

22,604
8,417
5,521

24,484
7,339
5,676

24,690
6,744
5,506

24,077
7,141
5,336

23,743
7,881
5,580

23,567
7,744
5,965

23,265
5,797
4,952

23,624
8,203
6,135

22,886
7,750
5,854

17,083
2,896

18,808
1,663

19,184
1,239

18,742
1,806

18,162
2,301

17,602
1,778

18,313
845

17,489
2,068

17,032
1,896

2,986
2,241
745

4,207
1,646
2,561

3,654
1,270
2,384

4,123
2,005
2,118

3,298
1,714
1,584

3,833
1,831
2,002

5,153
1,590
3,564

3,857
1,226
2,631

4,606
1,865
2,740

48

37

128

-61

8 banks in New York City

14

Basic reserve position
Excess reserves1

5

45

4

-7

LESS:

15
16

Borrowings at F.R. Banks. .
Net interbank federal funds
transactions

69

102

27

312

3,774

4,267

4,666

2,523

2,336

2,529

4,136

2,816

3,134

-3,843

-4,221

-4,763

-2,519

-2,370

-2,481

-4,099

-2,688

-3,507

EQUALS: N e t s u r p l u s , o r

deficit ( - ) :
Amount
Percent of average
reserves

required

Interbank federal funds transactions
Gross transactions:
Purchases
Sales
Two-way transactions2
Net transactions:
Purchases of net buying banks..
Sales of net selling banks

24
25
26

Related transactions with U.S.
government securities dealers
Loans to dealers3
Borrowing from dealers 4
Net loans

67.5

75.3

84.6

39.0

37.6

37.8

63.4

40.6

55.1

5,404
1,630
1,090

5,595
1,328
1,303

5,593
927
927

4,785
2,262
1,246

4,687
2,351
1,441

4,281
1,752
1,182

4,894
758
758

4,940
2,124
1,500

4,658
1,523
1,379

4,314
540

4,292
25

4,666

3,538
1,016

3,246
911

3,099
570

4,136

3,440
624

3,278
144

1,773
510
1,263

2,718
454
2,264

2,249
496
1,753

2,524
633
1,891

1,864
"59
1,106

2,114
659
1,455

2,970
609
2,361

2,382
450
1,932

3,066
420
2,646

38 banks outside New York City

27

Basic reserve position
Excess reserves1

16

65

136

-34

81

121

91

38

21

137

59

4

38

141

62

81

1

278

10,413

12,879

13,279

14,413

13,525

13,294

13,332

12,605

12,002

-10,534

-12,873

-13,147

-14,485

-13,585

-13,235

-13,323

-12,567

-12,258

LESS:

28
29

Borrowings at F.R. Banks. .
Net interbank federal funds
transactions
EQUALS: N e t s u r p l u s , o r

30
31

deficit ( - ) :
Amount
Percent of average
reserves

required

Interbank federal funds transactions
Gross transactions:
Purchases
Sales
Two-way transactions2
Net transactions:
Purchases of net buying banks..
Sales of net selling banks

37
38
39

Related transactions with U.S.
government securities dealers
Loans to dealers3
Borrowing from dealers4
Net loans
For notes see end of table.




101.5

126.9

128.5

125.9

118.8

116.5

117.2

108.3

106.3

17,200
6,786
4,431

18,889
6,010
4,373

19,097
5,818
4,579

19,293
4,879
4,089

19,056
5,530
4,140

19,286
5,992
4,783

18,371
5,039
4,194

18,684
6,079
4,635

18,229
6,227
4,475

12,769
2,356

14,517
1,639

14,518
1,239

15,203
790

14,916
1,391

14,503
1,208

14,177
845

14,049
1,444

13,754
1,752

1,212
1,731
-518

1,489
1,192
297

1,405
774
631

1,598
1,372
226

1,434
956
478

1,718
1,172
547

2,183
981
1,202

1,475
776
699

1,540
1,446
94

Federal Funds

Al

1.13 Continued
1978, week ending—
Type
Nov. 8

Nov. 1

Nov. 15

Nov. 22

Nov. 29

Dec. 6

Dec. 13

Dec. 20

Dec. 27

5 banks in City of Chicago

40

Basic reserve position
Excess reserves1

13

8

1

20

41

19

-19

15

LESS:

41
42

Borrowings at F.R. Banks
Net interbank federal funds
transactions

23
29

4,965

5,685

5,713

6,194

6,059

5,424

5,930

-4,951

-5,684

-5,705

-6,174

-6,017

-5,405

318.5

375.4

380.9

331.3

344.4

304.1

6,348
1,384
1,384

6,703
1,018
1,018

7,065
1,352
1,352

7,363
1,169
1,169

7,134
1,075
1,075

4,964

5,685

5,713

6,194

79
201
-122

191
224
-33

124
56
68

214
173
41

All

6,025

-5,915

-6,497

-6,030

341.6

355.2

348.9

7,030
1,606
1,606

7,082
1,153
1,153

1,104

1,226
1,189

7,183
1,158
1,101

6,059

5,424

5,930

6,515
38

6,083
58

236
229
7

216
354
-139

215
276
-60

300
160
140

259
417
-158

6,

EQUALS: N e t s u r p l u s , o r

43
44

deficit ( - ) :
Amount
Percent
of average
reserves

required

48
49

Interbank federal funds transactions
Gross transactions:
Purchases
Sales
Two-way transactions 2
Net transactions:
Purchases of net buying b a n k s . . .
Sales of net selling banks

50
51
52

Related transactions with U.S.
government securities dealers
Loans to dealers 3
Borrowing from dealers 4
Net loans

45
46
47

33 other banks

53

Basic reserve position
Excess reserves 1
LESS:

54
55

Borrowings at F.R. Banks
Net interbank federal funds
transactions

3

64

129

-54

40

102

76

58

-2

137

59

4

38

141

62

81

1

249

5,449

7,194

7,566

8,220

7,467

7,871

7,403

6,128

5,977

-5,583

-7,189

-7,441

-8,311

-7,568

-7,830

-7,408

-6,071

-6,228

EQUALS : N e t s u r p l u s , o r

56
57

deficit ( - ) :
Amount
Percent
of average
reserves

required

61
62

Interbank federal funds transactions
Gross transactions:
Purchases
Sales
Two-way transactions 2
Net transactions:
Purchases of net buying b a n k s . . .
Sales of net selling banks

63
64
65

Related transactions with U.S.
government securities dealers
Loans to dealers 3
Borrowing from dealers 4
Net loans

58
59
60

63.2

83.3

85.0

86.2

10,852
5,403
3,047

12,186
4,992
3,355

12,032
4,466
3,227

11,930
3,710
2,920

11,922
4,455
3,064

12,256
4,385
3,177

7,805
2,356

8,832
1,638

8,805
1,239

9,009
790

8,857
1,391

1,134
1,530
-396

1,299
968
330

1,282
718
564

1,384
1,199
186

1,198
727
471

1
Based on reserve balances, including adjustments to include waivers
of penalties for reserve deficiencies in accordance with changes in policy
of the Board of Governors effective Nov. 19, 1975.
2
Derived from averages for individual banks for entire week. Figure
for each bank indicates extent to which the bank's average purchases
and3 sales are offsetting.
Federal funds loaned, net funds supplied to each dealer by clearing
banks, repurchase agreements (purchases from dealers subject to resale),
or other lending arrangements.




78.1

81.7

76.9

62.1

63.5

11,289
3,886
3,041

10,981
4,853
3,446

11,045
5,068
3,374

9,079
1,208

8,248
845

7,534
1,406

7,671
1,694

1,503
818
685

1,968
705
1,263

1,175
616
559

1,281
1,029
252

4
Federal funds borrowed, net funds acquired from each dealer by
clearing banks, reverse repurchase agreements (sales of securities to
dealers subject to repurchase), resale agreements, and borrowings secured
by U.S. Govt, or other securities.

NOTE.—Weekly averages of daily figures. For description of series,
see August 1964 BULLETIN, pp. 944-53. Back data for 46 banks appear
in the B o a r d ' s Annual

Statistical

Digest,

1971-1975,

T a b l e 3.

A8
1.14

Domestic Financial Statistics • January 1979
FEDERAL RESERVE BANK

INTEREST

RATES

Per cent per annum
Current and previous levels
Loans to member banks—

Federal Reserve
Bank

Loans to all others
under Sec. 13, last par.*

Under Sec. 10(b)2

Under Sees. 13 and 13ai
Regular rate
Rate on
12/31/78

Effective
date

Previous
rate

9%

11/2/78
11/1/78
11/2/78
11/2/78
11/2/78
11/3/78
11/2/78
11/2/78
11/1/78
11/2/78
11/2/78
11/2/78

8%
8%
8%
8%
8%
8Vi
8%
8%
8%
81/2
8%
8%

Boston
New York
Philadelphia
Cleveland
Richmond
Atlanta
Chicago
St. Louis
Minneapolis
Kansas City
Dallas
San Francisco...

9%

9%
9%
91/2
9%
91/2
9%
9%
9%
9%
9%

Rate on
12/31/78
10
10
10
10
10
10
10
10
10

Effective
date

Special rate 3
Previous
rate

Rate on
12/31/78

Effective
date

Previous
rate

Rate on
12/31/78

Effective
date

Previous
rate

10%
10%
10%

11/2/78
11/1/78
11/2/78
11/2/78
11/2/78
11/3/78
11/2/78
11/2/78
11/1/78
11/2/78
11/2/78
11/2/78

9%
9%
9%
9%
9%
9%
9%
9%
9%
9%
9%
9%

12%
12%
12%
12%
12%
12%
12%
12%
12%
12%
12%
12%

11/2/78
11/1/78
11/2/78
11/2/78
11/2/78
11/3/78
11/2/78
11/2/78
11/1/78
11/2/78
11/2/78
11/2/78

11%
11%
11%
11%
11%
11%
11%
11%
11%
11%
11%
11%

Range
(or level)—
All F.R.
Banks

F.R.
Bank
of
N.Y.

11/2/78
11/1/78
11/2/78
11/2/78
11/2/78
11/3/78
11/2/78
11/2/78
11/1/78
11/2/78
11/2/78
11/2/78

10

10
10

10%

10%
10%
10%
10%
10%
10%
10%
10%

Range of rates in recent years 5

Effective date

In effect Dec. 31, 1970
1971—Jan.

Feb.
July
Nov
Dec.

8
15
19...
22
29
13...
19
16
23
11...
19...
13...
17...
24.

1973—Jan. 15
Feb. 26
Mar. 2
Apr. 2 3 . .

Range
(or level)—
All F.R.
Banks

F.R.
Bank
of
N.Y.

5%

5%

5!4-5%
5%

5V4
5V4

5-5V4

4%-4*4
4%-4*4
4%

5%
5
5
5
4%
5
5
5
434
434
4%
4%

5
5-5%
5%
5%-5*4

5
5%
5%
5%

5-5%
5
4*4-5
4%
434-5

4*4-5
4*4

Effective date

1973—May

4.
11.
18.
June 11.
15.
July
2.
Aug. 14.
23.

5*4
5*4-6

1974—Apr. 25,
30.
Dec. 9.
16.

7%-8
8
734-8
734

1975—Jan.

714-734
714-734
71/4
6*4-714
634
614-634
614
6-614
6

6.
10.
24.
Feb. 5.
7.
Mar. 10.
14.
May 16.
23,

1
Discounts of eligible paper and advances secured by such paper or by
U.S. govt, obligations or any other obligations eligible for F.R. Bank
purchase.
2
Advances secured to the satisfaction of the F.R. Bank. Advances
secured by mortgages on 1- to 4-family residential property are made at
the Section 13 rate.
3
Applicable to special advances described in Section 201.2(e)(2) of
Regulation A.




Range
(or level)—
All F.R.
Banks

6
6-6%
6%
7
7-7%
7%

F.R.
Bank
of
N.Y.

Effective date

5*4

1976—Jan.

19
23
Nov. 22.
26

5%-6
5%
514-5%
51/4

5%
5%
514
51/4

7%
7%

1977—Aug. 30
31
Sept. 2
Oct. 26

514-534
514-534
534
6

51/4
534
5*4
6

1978—Jan.

9
20
May 11
12
July
3
10
Aug. 21
Sept. 22
Oct. 16
20
Nov. 1
3

6-6%
6%
6%-7
7
7-714
714
734
8
8-8%
8%
8%-9%
9%

6%
6%
7
7
714
714
7*4
8
8%
8%
9%
9%

In effect Dec. 31, 1978

9%

9%

6
6
6%
6%
7

8
8

7*4
7*4
7*4
714
714

6*4
6*4
614
614
6
6

4
Advances to individuals, partnerships, or corporations other than
member banks secured by direct obligations of, or obligations fully
guaranteed as to principal and interest by, the U.S. govt, or any agency
thereof.
5
Rates under Sees. 13 and 13a (as described above). For description
and earlier data, see the following publications of the Board of Governors:

Banking
Statistics,
Statistical

and Monetary
Statistics,
1914-1941,
Banking
and
Monetary
1941-1970,
Annual
Statistical
Digest,
1971-75,
and
Annual
Digest,
1972-76.

Policy Instruments

A9

1.15 MEMBER BANK RESERVE REQUIREMENTS1
Per cent of deposits
Requirements in effect
December 31, 1978

Previous requirements

Type of deposit, and deposit interval
in millions of dollars
Per cent

Effective date

Per cent

Effective date

7
ny4
12 y 4
I6V4

12/30/76
12/30/76
12/30/76
12/30/76
12/30/76

m
10
12
13
16 %

2/13/75
2/13/75
2/13/75
2/13/75
2/13/75

3

3/16/67

3%

3/2/67

3
2%
1

3/16/67
1/8/76
10/30/75

3%
3
3

3/2/67
3/16/67
3/16/67

6
2%

12/12/74
1/8/76
10/30/75

5
3
3

Net demand: 2
10-100
100-400
Over 400
Time: 2 - 3 - 4
Savings
Other time: 5
0-5, maturing in—
30-179 days
180 days to 4 years
4 years or more
Over 5, maturing in—
30-179 days
180 days to 4 years
4 years or more

1

10/1/70
12/12/74
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
Annual Statistical Digest, 1971-1975 and for prior changes, see Board's
Annual Report for 1976, Table 13.
2 (a) Requirement schedules are graduated, and each deposit interval
applies to that part of the deposits of each bank. Demand deposits
subject to reserve requirements are gross demand deposits minus cash
items in process of collection and demand balances due from domestic
banks.
(b) The Federal Reserve Act specifies different ranges of requirements
for reserve city banks and for other banks. Reserve cities are designated
under a criterion adopted effective Nov. 9, 1972, by which a bank having
net demand deposits of more than $400 million is considered to have the
character of business of a reserve city bank. The presence of the head
office of such a bank constitutes designation of that place as a reserve
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
less are considered to have the character of business of banks outside of
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.




(c) Effective August 24, 1978, the Regulation M reserve requirements
on net balances due from domestic banks to their foreign branches and
on deposits that foreign branches lend to U.S. residents were reduced to
zero from 4 per cent and 1 per cent, respectively. The Regulation D
reserve requirement on borrowings from unrelated banks abroad was
also reduced to zero from 4 per cent.
3
Negotiable orders of withdrawal (NOW) accounts and time deposits
such as Christmas and vacation club accounts are subject to the same
requirements as savings deposits.
4
The average reserve requirement on savings and other time deposits
must
be at least 3 per cent, the minimum specified by law.
5
Effective November 2, 1978, a supplementary reserve requirement of
2 per cent was imposed on time deposits of $100,000 or more, obligations
of affiliates, and ineligible acceptances.
NOTE.—Required reserves must be held in the form of deposits with
F.R. Banks or vault cash.

A10

DomesticNonfinancialStatistics • January 1979

1.16 MAXIMUM INTEREST RATES PAYABLE on Time and Savings Deposits at Federally Insured Institutions
Per cent per annum
Commercial banks

Type and maturity of deposit

1 Savings
2
Negotiable orders of withdrawal
accounts 1
3
Money market time deposit of less than
$100,0002

90 days to 1 year:
Multiple-maturity
Single-maturity

5

7/1/73

4%

5

1/1/74

(10)

(9)

(9)

( )

7/1/73

4%
5

5Vi

7/1/73

6

7/1/73
7/1/73

9

1 to 2 years
2 to 2y 2 years 4
2i/ 2 to 4 years 4

6V1

11
12
13

4 to 6 years 5
6 to 8 years 5
8 years or more 5

m
m
m

14

Issued to governmental units (all
maturities)
Individual retirement accounts and
Keogh (H.R. 10) plans 6

Effective
date

Effective
date

5%

( )

5

5

1/1/74

(10)

(9)

(9)

( )

1/21/70

9

( )

11/1/73
12/23/74
6/1/78

6/1/78

4

5 y4

(7)

5%

(7)
(7)

6
6

11/1/73

71/2
7y 4
8

m
m

6/1/78

(10)

C11)
71/4
(10)

9

1/21/70
9/26/66

61/2

5Va

Per cent

7

1/21/70
1/21/70
1/21/70

51/2

Previous maximum

Per cent

sy4

1
For authorized States only. Federally insured commercial banks,
savings and loan associations, cooperative banks, and mutual savings
banks in Massachusetts and New Hampshire were first permitted to offer
negotiable orders of withdrawal (NOW) accounts on Jan. 1, 1974.
Authorization to issue N O W accounts was extended to similar institutions
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 denomination of $10,000, and must be nonnegotiable.
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).
4
A minimum of $1,000 is required for savings and loan associations,
except in areas where mutual savings banks permit lower minimum denominations. This restriction was removed for deposits maturing in less
than 1 year, effective Nov. 1, 1973.
5
$1,000 minimum except for deposits representing funds contributed
to an Individual Retirement Account (IRA) or a Keogh (H.R. 10) Plan established pursuant to the Internal Revenue Code. The $1,000 minimum
requirement was removed for such accounts in December 1975 and November
1976, respectively.
6
3-year minimum maturity.
7
July 1, 1973, for mutual savings banks; July 6, 1973, for savings and
loan associations.
8 Oct. 1, 1966, for mutual savings banks; Jan. 21, 1970, for savings and
loan associations.
9 Commercial banks, savings and loan associations, and mutual savings
banks were authorized to offer money market time deposits effective
June 1, 1978. The ceiling rate for commercial banks is the discount rate
on most recently issued 6-month U.S. Treasury bills. The ceiling rate for
savings and loan associations and mutual savings banks is l/4 per cent

1.161

In effect Dec. 31, 1978

7/20/66
9/26/66

4

8
9
10

15

Per cent

Effective
date

Other time (multiple- and singlematurity unless otherwise indicated) 3
30-89 days:
4
Multiple-maturity
5
Single-maturity
6
7

Previous maximum

In effect Dec. 31, 1978
Per cent

Savings and loan associations and
mutual savings banks

ey4

sy4

O1)
71/2

11/1/73
12/23/74
6/1/78

12/23/74

8

6/1/78

7/6/77

8

6/1/78

(10)

m
m

higher than the rate for commercial banks. The most recent rates and
effective dates are as follows:
Nov. 30
9.330
9.580

Thrifts

Dec. 7
9.220
9.470

Dec. 14

Dec. 21

9.263
9.513

Dec. 28

9.524
9.774

9.580
9.830

10 N o separate account category.
11 Between July 1, 1973, and Oct. 31, 1973, there was no ceiling for
certificates maturing in 4 years or more with minimum denominations
of $1,000; however, the amount of such certificates that an institution
could issue was limited to 5 per cent of its total time and savings deposits.
Sales in excess of that
amount, as well as certificates of less than $1,000,
were limited to the 6l/z per cent ceiling on time deposits maturing in 2l/i
years or more.
Effective Nov. 1, 1973, ceilings were reimposed on certificates maturing
in 4 years or more with minimum denominations of $1,000. There is no
limitation on the amount of these certificates that banks can issue.
NOTE—Maximum rates that can be paid by Federally insured commercial banks, mutual savings banks, and savings and loan associations are
established by the Board of Governors of the Federal Reserve System,
the Board of Directors of the Federal Deposit Insurance Corporation,
and the Federal Home Loan Bank Board under the provisions of 12
CFR 217, 329, and 526, respectively. The maximum rates on time deposits in denominations of $100,000 or more were suspended in mid1973. 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.

MARGIN REQUIREMENTS
Per cent of market value; effective dates shown.
Type of security on sale

1 Margin stocks
2 Convertible bonds
3 Short sales

Mar. 11, 1968

June 8, 1968

May 6, 1970

Dec. 6, 1971

Nov. 24, 1972

Jan. 3, 1974

70
50
70

80
60
80

65
50
65

55
50
55

65
50
65

50
50
50

NOTE.—Regulations G, T, and U of the Federal Reserve Board of
Governors, prescribed in accordance with the Securities Exchange Act of
1934, limit the amount of credit to purchase and carry margin stocks
that may be extended on securities as collateral by prescribing a maximum
loan value, which is a specified percentage of the market value of the
collateral at the time the credit is extended. Margin requirements are the




difference between the market value (100 per cent) and the maximum
loan value. The term "margin stocks" is defined in the corresponding
regulation.
Regulation G and special margin requirements for bonds convertible
into stocks were adopted by the Board of Governors effective Mar. 11,
1968.

Policy Instruments
1.17

All

F E D E R A L RESERVE O P E N M A R K E T T R A N S A C T I O N S
Millions of dollars
1978
Type of transaction

1977

1975

1976

11,562
5,599
26,431

14,343
8,462
2 5,017

3,886

472

3,017

-4
3,549

792

4.499
2.500

May

June

Aug.

July

Sept.

Oct.

Nov.

2,635

1,978
2,148

2,039
3,587
603

U.S. GOVERNMENT SECURITIES
Outright transactions (excluding matched salepurchase transactions)
Treasury bills:

Others within 1 year: 1
6

Exchange, or maturity shift
1 to 5 years:

10

2 3,284
3,854

Exchange, or maturity shift
5 to 10 years:

1,510
-4,697

14
1
17
18
19

Over 10 years:
Gross purchases..
Fyph/ifKyp or matiiritv cliift
All maturities: 1
Gross purchases
Gross sales
•
Redemptions

••

....

13,738
7,241
2,136

73

139

563

-385

-778

424

350

507

628

241

-490

-563

385

-657

110

87

1,048

758

101

176

238

1,572

584

1,526

-87

1,434

115

113

163
835

139

122

108

1,070

642

553

74

848

225

1,565

895

221,313
5,599
29,980

219,707
8,639
25,017

20,898
7,241
4,636

935
737
300

5,451

701
466

1,919
689

3,386

2,785
2,148

3,075
3,587
603

196,078 425,214
196,579 423,841

40,634
40,362

52,544
52,557

44,657
44,712

29,162
29,641

33,346
33,130

35,112
36,106

40,785
40,546

11,517
11,819

14,956
13,100

15,822
17,374

16,286
15,140

10,724
10,353

18,976
20,565

7,719
8,383

-1,261

2,854

3,540

43

-2,017

140,311 232,891
139,538 230,355

178.683
180^535

600

600

-674

24 Net change in U.S. Government securities

Net change in Federal agency obligations

168

-1,544

631

Repurchase agreements
Gross purchases
Gross sales

30

171
-241

135
-380

467

22
23

28
29

972
689

290

151,205
152,132

25
26
27

701
466

-79

Matched sale-purchase transactions
Gross sales
Gross purchases

FEDERAL AGENCY OBLIGATIONS

53
-2,343

4,395

2 3,202
2,833
177
-2,588 -6,649

20
21

Outright transactions:
Gross purchases
Gross sales
Redemptions
Repurchase agreements:
Gross purchases
Gross sales

416
737
300

7,434

9,087

5,798

246
1,616

169
891

223
1,433

34

28
301

4

173
13

28

12

39

15,175
15,567

10,520
10,360

13,811
13,638

3,927
4,037

3,421
3,088

5,170
5,457

3,080
3,032

3,877
3,348

6,675
7,196

2,544
2,670

978

882

1,383

-144

606

-291

-138

501

—533

-165

163
-35

-545
410

-196
159

-17

747

-753

28

419

-479

-236

-17

747

-753

28

419

-479

-236

8,783

-2,305

2,744

4,460

-969

-2,419

7,320

r

BANKERS ACCEPTANCES
31 Outright transactions net
32 Repurchase agreements, net
33 Net change in bankers acceptances
34 Total net change in System Open Market
Account

127

-135

-37

8,539

9,833

7,143

1
Both gross purchases and redemptions include special certificates
created when the Treasury borrows directly from the Federal Reserve,
as follows (millions of dollars): 1975, 3,549; 1976, none; Sept. 1977,
2,500.
2 In 1975, the System obtained $421 million of 2-year Treasury notes
in exchange for maturing bills. In 1976 there was a similar transaction




-834

amounting to $189 million. Acquisition of these notes is treated as a
purchase; the run-off of bills, as a redemption.
NOTE.—Sales, redemptions, and negative figures reduce holdings of
the System Open Market Account; all other figures increase such holdings.
Details may not add to totals because of rounding.

A12

DomesticNonfinancialStatistics • January 1979

1.18 FEDERAL RESERVE BANKS

Condition and F.R. Note Statements

Millions of dollars

Nov. 29

Dec. 6

Wednesday

End of month

1978

1978

Dec. 13

Dec. 20?

Dec. 27»

Oct.

Nov.

Consolidated condition statement
ASSETS
1
2

Gold certificate account
Special Drawing Rights certificate account.

3

Coin

11,611
1,300

11,671
1,300

11,655
1,300

11,642
1,300

277

271

300

275

502

3,111

1,207

813

444

236

7,896

7,896

7,896
1,269

7,938
127

7,899

11,640
1,300

11,635
1,300

272

277

586

472

7,899
625

7,899

11,642
1,300
274

8
9

Loans:
Member bank borrowings
Other
Acceptances:
Bought outright
Held under repurchase agreements..
Federal agency obligations:
Bought outright
Held under repurchase agreements..

10
11
12
13
14
15
16

U.S. Government securities
Bought outright:
Bills
Certificates—Special
Other
Notes
Bonds
Total i
Held under repurchase agreements.

44,790

37,041

43,238

39,784

42,263

48,376

45,985

54,855
12,465
112,110
2,000

54,855
12,465
104,361

54,855
12,465
110,558

54,855
12,465
107,104

54,855
12,465
109,583
2,056

54,526
11,757
114,659
663

54,855
12,465
113,305

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
20

12,738
396

15,357
398

14,203
398

17,975
397

15,820
398

13,366
395

13,165
396

21
22

Cash items in process of collection....
Bank premises
Other assets:
Denominated in foreign currencies.
All other

47
1,962

49
2,017

62
2,041

1,643
2,302

1,643
2,580

27
2,334

53
1,901

23

Total assets.

152,633

143,879

148,842

151,007

158,042

154,207

150,749

101,070

101,462

102,202

102,781

103,892

98,154

100,825

32,402
7,236
275
479

28,648
2,169
367
553

33,116
1,869
204
582

30,788
4,500
275
582

37,254
3,540
285
613

26,260
15,467
305
531

31,919
6,587
379
567

40,392

31,737

35,771

36,145

41,692

42,563

39,452

6,587
1,784

6,884
1,516

6,584
1,854

7,582
1,905

7,754
1,946

8,930
1,686

5,927
1,725

149,833

141,599

146,411

148,413

155,284

151,333

147,929

1,073
1,029
698

1,075
1,029
176

1,076
1,029
326

1,076
1,029
489

1,078
1,029
651

1,069
1,029
776

1,073
1,029
718

143,879

148,842

151,007

158,042

154,207

150,749

92,610

93,473

93,973

95,145

'90,073

92,412

4
5
6
7

1,270
370

LIABILITIES
24 Federal Reserve notes
Deposits:
25
Member bank reserves
26
U.S. Treasury—General account.
27
Foreign
28
Other 2
29

Total deposits.

30
31

Deferred availability cash items
Other liabilities and accrued dividends.

32

Total liabilities
CAPITAL A C C O U N T S

33
34
35

Capital paid in
Surplus
Other capital accounts

36

Total liabilities and capital accounts

37

MEMO: Marketable U.S. Govt, securities held in
custody for foreign and intl. account

152,633
91,855

Federal Reserve note statement
F.R. notes outstanding (issued to Bank)
Collateral held against notes outstanding:
Gold certificate account
Special Drawing Rights certificate a c c o u n t . . . .
Eligible paper
U.S. Government securities

112,423

112,661

112,943

113,154

112,941

110,741

112,445

112,836

39
40
41
42

11,642
1,300
1,170
98,311

11,640
1,300
534
99,187

11,635
1,300
418
99,590

11,611
1,300
445
99,798

11,671
1,300
1,848
98,122

11,655
1,300
1,094
96,692

11,642
1,300
692
98,811

11,671
1,300
907
98,958

43

Total collateral

112,423

112,(§61

112,943

113,154

112,941

110,741

112,445

112,836

38

1
Includes securities loaned—fully guaranteed by U.S. Govt, securities
pledged with F.R. Banks—and excludes (if any) securities sold and
scheduled to be bought back under matched sale-purchase transactions.




2
Includes certain deposits of domestic nonmember banks and foreignowned banking institutions voluntarily held with member banks and
redeposited in full with F.R. Banks.

Reserve Banks
1.19 FEDERAL RESERVE BANKS

A13

Maturity Distribution of Loan and Security Holdings

Millions of dollars

Type and maturity
Nov. 29

2

588
526
62

1,260
1,222
38

Within 15 days

End of month

1978

1978

Dec. 13

Dec. 27

Dec. 20
502
479
23

473
387
86

370
370

5 Acceptances
6
Within 15 days
7
16 days to 90 days
9 U.S. Government securities
10
Within 15 days 1
11
16 days to 90 days

17
18
19
20
21
22

Dec. 6

Wednesday

Within 15 days 1
16 days to 90 days
91 days to 1 year
Over 1 year to 5 years
Over 5 years to 10 years
Over 10 years

Oct. 31

3,111
3,093
18

1,206
1,108
98

444
444

236
236

Nov. 30
812
767
45

Dec. 31
1,172
1,142
30
587
587

114,110
7,352
19,775
29,758
31,833
14,717
10,675

104,361
3,748
15,369
28,244
31,608
14,717
10,675

110,558
4,450
19,654
29,454
31,608
14,717
10,675

107,104
5,647
15,058
29,399
31,608
14,717
10,675

111,639
6,915
18,179
29,545
31,608
14,717
10,675

115,322
7,195
22,072
30,730
31,638
13,719
9,968

113,305
4,467
20,315
31,523
31,608
14,717
10,675

110,562
4,297
19,800
29,465
31,608
14,717
10,675

8,524
761
437
1,292
3,686
1,488
860

7,899
73
493
1,299
3,686
1,488
860

7,896

7,896
83
482
1,286
3,723
1,461
861

9,165
1,353
482
1,286
3,723
1,461
860

8,065
164
369
1,488
3,664
1,520
860

7,899
135
438
1,292
3,686
1,488
860

8,029
217
482
1,286
3,723
1,511
810

566
1,286
3,723
1,461
860

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
Bank group, or type
of customer

1975

1976

1977
July
Debits to demand deposits

1 All commercial banks
2 Major New York City banks. .
3 Other banks

25,028.5
9,670.7
15,357.8

29,180.4
11,467.2
17,713.2

34,322.8
13,860.6
20,462.2

174.0
21.7
152.3

(seasonally adjusted)
42.722.1
16,432.9
26.289.2

40,575.1
15,355.3
25,219.7
3

Debits to savings deposits
4 All customers
5 Business 1
6 Others

2

105.3
356.9
72.9

116.8
411.6
79.8

129.2
503.0
85.9

432.1
55.6
376.5

433.0
57.6
375.4

Savings deposit turnover
10 All customers
11 Business 1
12 Others.
1
Represents corporations and other profit-seeking organizations (excluding commercial banks but including savings and loan associations,
mutual savings banks, credit unions, the Export-Import Bank, and
Federally sponsored lending agencies).
2
Represents accounts of individuals, partnerships, and corporations,
and of States and political subdivisions.
3 Excludes negotiable orders of withdrawal (NOW) accounts and
special club accounts, such as Christmas and vacation clubs.




1.6
4.1
1.5

2.0
5.1
1.8

2

3

42,855.9
15,437.3
27,418.6

43,222.7
16,172.3
27,050.5

420.4
60.9
359.5

461.4
67.2
394.2

446.1
65.5
380.7

144.1
530.1
102.2

146.3
577.6
101.1

2.1
5.8
1.9

2.0
5.7
1.8

(seasonally adjusted)

146.2
577.5
99.7

139.0
553.0
95.5

41.811.6
15,495.9
26.315.7

(not seasonally adjusted)

Demand deposit turnover
7 All commercial banks
8 Major New York City banks. .
9 Other banks

Nov.

Oct.

Sept.

Aug.

141.6
549.6
98.6

(not seasonally adjusted)
2.0
5.2
1.8

1.9
5.3
1.7

NOTE.—Historical data—estimated for the period 1970 through June
1977, partly on the basis of the debits series for 233 SMSA's, which were
available through June 1977—are available from Publications Services,
Division of Administrative Services, Board of Governors of the Federal
Reserve System, Washington, D.C. 20551. Debits and turnover data
for savings deposits are not available prior to July 1977.

A14
1.21

DomesticNonfinancialStatistics • January 1979
MONEY STOCK MEASURES AND COMPONENTS
Billions of dollars, averages of daily figures
1978
1974
Dec.

1975
Dec.

1976
Dec.

1977
Dec.
June

Item

July

Aug.

Sept.

Oct.

Nov.

356.7
582.0
853.5
1,455.1
939.8
1,541.4

360.9
587.9
862.4
1,472.1
950.5
1,560.2

362.0
588.8
867.4
r
l,483.9
955.6
r
l,572.1

360.6
585.3
870.5
1,492.1
966.0
1,587.6

Seasonally adjusted
MEASURES i
1
2
3
4
5
6

282.9
419.0
612.2
981.2
701.2
1,070.3

M-l
M-1 +
M-2
M-3
M-4
M-5

295.2
456.4
664.7
1,092.5
746.1
1,173.8

313.5
516.8
740.5
1,236.5
803.2
1,299.2

338.5
560.2
809.5
1,376.1
883.5
1,450.1

352.8
577.1
840.6
1,429.8
927.3
1,516.5

354.2
577.8
846.2
1,441.0
933.6
1,528.4

COMPONENTS
7 Currency
Commercial bank deposits:
Demand
8

67.8

73.7

80.7

88.6

92.8

93.3

94.0

95.2

96.0

96.8

215.1

221.5

232.8

249.9

259.9

260.9

262.8

265.7

266.1

263.9

9

418.3

450.9

489.7

545.0

574.5

579.4

583.0

589.7

593.6

160.5
81.3
209.1

201 .9
62.7
225.1

219.6
74.0
251.5

221.7
86.7
266.1

220.9
87.4
271.1

605.3

135.8
89.0
193.5

222.4
86.3
274.3

224.2
88.1

223.9
88.2
281.5

221.8
95.4
288.0

369.1

427.8

496.0

566.6

589.2

594.7

601.6

609.6

'616.5

621.6

354.2
579.2
850.8
1,453.0
938.8
1,541.0

358.8
'583.7
858.4
1,466.4
948.7
1,556.7

361.3
586.2
864.5
'1,478.5
955.3
'1,569.3

362.9
585.7
867.6
1,484.3
964.0
1,580.6

10
11
12

Time and savings

Savings
Negotiable CD's 2
Other time

13 Nonbank thrift institutions 3

211A

N o t seasonally adjusted
MEASURES i
14
15
16
17
18
19

291.3
426.2
617.5
983.8
708.0
1,074.3

M-l
M-l +
M-2
M-3
M-4
M-5

303.9
463.6
670.0
1,095.0
753.5
1,178.4

322.6
524.2
745.8
1,238.4
810.0
1,320.7

348.2
568.1
814.9
1,377.5
890.9
1,453.4

351.7
578.1
842.0
1,435.2
928.3
1,521.5

356.0
581.9
848.7
1,447.9
936.0
1,535.3

r

COMPONENTS
20 Currency
Commercial bank deposits:
21

22
23
24

25
26
27

Demand

Member
Domestic nonmember
Time and savings

Savings
Negotiable CD's 2
Other time

28 Other checkable deposits 4 3
29 Nonbank thrift institutions
30 U.S. Government deposits (all commerical banks)

69.0
222.2

75.1
228.8

82.1
240.5

90.1
258.1

92.9
258.8

94.1
262.0
ill .1

94.3
259.9

95.0
263.8

95.8
265.6

97.4
265.5

159.7
58.5

162.8
62.6

169.4
67.5

177.5
76.2

175.7
79.1

176.1
79.9

178.2
81.8

179.2
82.6

449.6

487.4

542.6

178.2
83.5

416.7

576.6

579.9

584.6

589.9

594.0

134.5
90.5
191.7

159.1
83.5
207.1

200.2
64.3
222.9

217.7
75.9
249.0

601.1

223.8
86.3
266.5

223.1
87.3
269.5

222.2
88.0
274.4

222.1
90.3
277.5

222.0
90.8
281.2

220.0
96.4
284.8

0.4
366.3

0.7
424.9

1.4
492.7

2.1
562.5

2.6
593.2

2.7
599.3

2.8
602.1

'2.8
608.1

'2.8
'614.0

2.8
616.6

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:
M - l : Averages of daily figures for (1) demand deposits at commercial
banks other than domestic interbank and U.S. Govt., less cash items in
process of collection and F.R. float; (2) foreign demand balances at F.R.
Banks; and (3) currency outside the Treasury, F.R. Banks, and vaults
of commercial banks.
M-l
: M-l plus savings deposits at commercial banks, N O W accounts
at banks and thrift institutions, credit union share draft accounts, and
demand deposits at mutual savings banks.
M-2: M-l plus savings deposits, time deposits open account, and time
certificates of deposit (CD's) other than negotiable CD's of $100,000 or
more at large weekly reporting banks.
M-3: M-2 plus the average of the beginning- and end-of-month deposits

80.3

of mutual savings banks, savings and loan shares, and credit union shares
(nonbank thrift).
M-4: M-2 plus large negotiable CD's.
M-5: M-3 plus large negotiable CD's.
Latest monthly and weekly figures are available from the Board's 508
(H.6) release. Back data are available from the Banking Section, Division
of Research and Statistics.
2 Negotiable time CD's issued in denominations of $100,000 or more
by large weekly reporting commercial banks.
3 Average of the beginning- and end-of-month figures for deposits of
mutual savings banks, for savings capital at savings and loan associations,
and for credit union shares.
4
Includes NOW accounts at thrift institutions, credit union share
draft accounts, and demand deposits at mutual savings banks.

NOTES TO TABLE 1.23:
1
Adjusted to exclude domestic commercial interbank loans.
2 Loans sold are those sold outright to a bank's own foreign branches,
nonconsolidated nonbank affiliates of the bank, the bank's holding
company (if not a bank), and nonconsolidated nonbank subsidiaries of
the holding company. Prior to Aug. 28, 1974, the institutions included
had been defined somewhat differently, and the reporting panel of banks
was also different. On the new basis, both "Total loans" and "Commerical and industrial loans" were reduced by about $100 million.
3
Data beginning June 30, 1974, include one large mutual savings
bank that merged with a nonmember commercial bank. As of that date
there were increases of about $500 million in loans, $100 million in
"Other" securities and $600 million in "Total loans and investments."
As of Oct. 31, 1974, "Total loans and investments" of all commercial
banks were reduced by $1.5 billion in connection with the liquidation




of one large bank. Reductions in other items were: "Total loans," $1.0
billion (of which $0.6 billion was in "Commercial and industrial loans"),
and "Other securities," $0.5 billion. In late November "Commercial and
industrial loans" were increased by $0.1 billion as a result of loan reclassifications at another large bank.
4
Reclassification of loans reduced these loans by about $1.2 billion
as of Mar. 31, 1976.
5 Reclassification of loans at one large bank reduced these loans by
about $200 million as of Dec. 31, 1977.
NOTE.—Data are for last Wednesday of month except for June 30
and Dec. 31; data are partly or wholly estimated except when June 30
and Dec. 31 are call dates.

Monetary
1.22 AGGREGATE RESERVES AND DEPOSITS

Aggregates

A15

Member Banks

Billions of dollars, averages of daily figures
1978

1977
1974
Dec.

Item

1975
Dec.

1976
Dec.
Apr.

Dec.

May

June

July

Aug.

Sept.

Oct.

Nov.

Seasonally adjusted
1 Reserves 1
36.57
2 Nonborrowed
35.84
36.31
3 Required
4 Deposits subject to reserve requirements 2 . . 486.1
322.1
5 Time and savings
Demand:
160.6
6
Private
3.3
7
U.S. Government.

34.68
34.55
34.42
504.6
337.1

34.93
34.89
34.29
528.9
354.3

36.14
35.57
35.95
569.1
387.0

36.95
36.39
36.80
586.0
400.7

37.26
36.05
37.04
592.0
406.0

37.73
36.63
37.55
595.6
407.1

38.19
36.88
38.00
600.3
410.5

37.91
36.77
37.74
601.1
411.4

38.17
37. 11
37.97
606.4
416.0

r
38.43
r

37.15
38.26
608.1
417.5

39.73
39.03
39.51
677.1
427.9

164.5
2.9

171.4
3.2

178.5
3.6

182.0
3.3

183.5
2.6

184.6
3.9

186.1
3.7

186.5
3.3

186.3
4.1

187.2
3.5

186.9
2.3

Not seasonally adjusted
8 Deposits subject to reserve requirements 2 ..
Time and savings
.
9
Demand:
Private
10
11
U.S. Government

491.8
321.7

510.9
337.2

534.8
353.6

575.3
386.4

588.6
401.2

588.3
406.1

596.8
408.6

600.6
411.1

599.2
412.8

605.9
416.6

608.4
418.5

614.9
425.2

166.6
3.4

170.7
3.1

177.9
3.3

185.1
3.8

183.8
3.6

179.3
2.9

183.7
4.5

186.4
3.2

183.9
2.5

184.7
4.6

186.9
3.0

187.7
2.0

1
Series reflects actual reserve requirement percentages with no adjustment to eliminate the effect of changes in Regulations D and M. There
are breaks in series because of changes in reserve requirements effective
Dec. 12, 1974; Feb. 13, May 22, and Oct. 30,1975; Jan. 8, and Dec. 30,1976.
In addition, effective Jan. 1, 1976, statewide branching in New York
was instituted. The subsequent merger of a number of banks raised
required reserves because of higher reserve requirements on aggregate
deposits at these banks.

1.23 LOANS AND INVESTMENTS

2
Includes total time and savings deposits and net demand deposits as
defined by Regulation D . Private demand deposits include all demand
deposits except those due to the U.S. Govt., less cash items in process of
collection and demand balances due from domestic commercial banks.

NOTE.—Back data and estimates of the impact on required reserves
and changes in reserve requirements are shown in Table 14 of the Board's
Annual

Statistical

Digest,

1971-1975.

All Commercial Banks

Billions of dollars; last Wednesday of month except for June 30 and Dec. 31
1978
Category

1974
Dec. 313

1975
Dec. 31

1976
Dec. 31

1977
Dec. 31

July 26 p

Aug. 30*>

Sept. 21*

Oct. 25*>

Nov. 29p

Dec. 31*>

Seasonally adjusted
j Loans and investments1
2
Including loans sold o u t r i g h t 2 . . . .

691.1
695.9

721.8
726.2

785.1
788.9

870.6
875.5

940.7
945.3

944.6
949.3

952.4
957.0

960.9
964.8

966.5
970.2

967.3
971.1

3
4
5
6

Loans:
Total
Including loans sold outright 2 ...
Commercial and industrial
Including loans sold outright 2 ...

500.2
505.0
183.5
186.2

496.9
501.3
176.2
178.7

538.9
542.7
4179.7
4182.1

617.0
621.9
5201.4
5204.2

675.1
679.7
220.8
223.1

680.2
684.9
222.8
225.2

687.3
691.9
224.6
226.9

696.8
700.7
227.0
228.9

706.8
710.5
228.9
230.8

709.0
712.8
228.9
230.7

7
8

Investments:
U.S. Treasury
Other

51.1
139.8

80.1
144.8

98.0
148.2

95.6
158.0

100.6
165.0

97.9
166.5

97.2
167.9

95.2
168.9

90.3
169.4

88.4
169.9

Not seasonally adjusted
9 Loans and investments1
10
Including loans sold outright 2

705.6
710.4

737.0
741.4

801.6
805.4

888.9
893.8

936.6
941.2

942.0
946.7

951.4
956.1

958.4
962.3

969.3
973.0

987.6
991.4

11
12
13
14

Loans:
Total 1
Including loans sold outright 2 ...
Commercial and industrial
Including loans sold outright 2 ...

510.7
515.5
186.8
189.5

507.4
511.8
179.3
181.8

550.2
554.0
4182.9
4185.3

629.9
634.8
5205.0
5207.8

675.6
680.2
220.9
232.2

681.0
685.7
221.7
224.1

688.6
693.3
223.9
226.2

696.6
700.5
226.5
228.4

707.2
710.9
228.9
230.8

723.9
727.7
233.0
234.8

15
16

Investments:
U.S. Treasury
Other

54.5
140.5

84.1
145.5

102.5
148.9

100.2
158.8

96.1
164.9

94.8
166.2

95.0
167.7

93.5
168.3

92.6
169.5

93.0
170.7

For notes see bottom of opposite page.




A16

DomesticNonfinancialStatistics • January 1979

1.24 COMMERCIAL BANK ASSETS AND LIABILITIES

Last-Wednesday-of-Month Series

Billions of dollars except for number of banks
1978 3

1977
Account
Dec.

Mar.

May

Apr.

June

July?

Aug.?

Sept.2*

Oct.p

Nov.*

Dec.*

All commercial
1 Loans and investments
2
Loans, gross
Investments:
U.S. Treasury securities...
3
4
Other
5
6
7
8
9
10

Cash assets
Currency and coin
Reserves with F.R. B a n k s . . .
Balances with banks
Cash items in process of collection..
Total assets/total
capital 1

liabilities

15
16

Demand:
Interbank
U.S. Government
Other
Time:
Interbank
Other

17
18

Borrowings
Total capital accounts 2

19

MEMO: Number of banks

939.7
680.4

953.0
688.7

974.4
712.4

985.0
722.1

980.6
719.6

985.5
724.5

996.4 1,003.0 1 , 0 1 6 . 2
754.1
733.6
741.2

1,034.7
770.9

100.2
158.8

99.0
160.3

100.2
164.1

97.3
164.6

97.9
165.1

96.1
164.9

94.8
166.2

95.0
167.7

93.5
168.3

92.6
169.5

92.6
171.2

168.7
13.9
29.3
59.0
66.4

130.5
14.4
30.2
42.6
43.3

133.1
14.3
27.6
43.6
47.6

161.0
14.5
30.3
51.9
64.3

166.8
12.0
29.6
56.0
69.3

130.2
14.8
23.6
44.4
47.3

137.4
15.2
29.7
43.0
49.5

141.8
15.2
32.6
44.4
49.6

146.5
15.1
34.6
45.0
51.7

149.2
16.7
32.6
46.5
53.5

170.1
17.2
37.7
51.6
63.6

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

939.4

899.8

915.5

952.9

965.7

932.3

937.7

949.9

952.3

959.0

993.1

51.7
7.3
323.9

37.6
4.9
281.2

39.0
6.2
293.8

51.2
3.3
312.9

49.3
8.0
317.5

40.5
4.3
296.3

40.4
2.8
298.6

41.9
11.0
297.1

43.3
7.6
299.2

42.9
2.1
304.7

51.1
2.3
327.1

9.8
546.6

9.0
567.1

9.0
567.5

9.4
576.1

10.2
580.8

10.3
580.9

10.7
585.2

11.6
588.3

11.1
591.2

11.8
597.6

12.4
600.3

96.2
85.8

105.6
83.4

104.9
83.7

112.2
84.6

106.8
89.9

103.2
85.8

109.1
86.2

112.8
87.1

118.3
87.1

125.6
87.8

133.0
87.3

14,707

14,689

14,697

14,702

14,698

14,713

14,721

14,715

14,713

14,719

14,719

and

11
12
13
14

939.1
680.1

Member
20
21
22
23

Loans, gross
Investments:
U.S. Treasury securities. . .
Other

675.5
494.9

668.6
490.5

676.8
495.3

693.8
514.3

699.7
519.6

695.8
517.6

698.9
520.3

706.9
527.0

713.4
533.9

724.3
544.6

739.5
558.3

70.4
110.1

68.2
109.9

68.8
112.7

66.9
112.7

67.4
112.7

65.7
112.5

65.3
113.3

65.4
114.5

64.1
115.3

63.5
116.2

63.6
117.6

133.8
8.7
29.6
29.1
66.5

104.2
10.8
23.6
24.3
45.4

111.2
11.1
29.7
22.9
47.6

115.4
11.1
32.6
24.0
47.7

118.6
11.1
34.6
23.2
49.7

121.3
12.3
32.6
25.1
51.4

140.2
12.7
37.7
28.6
61.2

24
25
26
27
28

Cash assets, total
Currency and coin
Reserves with F.R. B a n k s . . .
Balances with banks
Cash items in process of collection..

134.4
10.4
29.3
30.8
63.9

104.8
10.6
30.2
22.9
41.2

106.5
10.5
27,6
22.7
45.7

130.7
10.6
30.3
28.1
61.7

29

Total assets/total
capital 1

861.8

833.2

843.3

884.7

888.7

857.3

868.5

882.2

891.2

908.5

945.2

30

Deposits
Demand:

683.5

645.1

655.1

686.7

694.3

666.1

670.6

679.6

682.5

688.6

716.3

48.0
5.4
239.4

34.7
3.7
205.1

36.0
4.5
213.4

47.5
2.2
229.1

45.5
5.6
231.6

37.3
3.1
214.6

37.2
1.9
217.0

38.6
8.1
215.6

39.9
5.7
217.0

39.5
1.5
221.3

47.3
1.6
237.9

7.8
382.9

7.0
394.7

6.9
394.3

7.3
400.5

8.1
403.4

8.2
402.9

8.6
405.9

9.4
407.8

9.0
411.0

9.7
416.7

10.2
419.3

84.9
63.7

91.8
62.4

91.1
62.7

96.9
63.3

92.1
66.1

88.0
64.2

93.9
64.5

97.2
65.1

101.4
65.2

108.1
65.7

115.9
65.5

5,669

5,654

5,645

5,638

5,622

5,613

5,610

5,593

5,585

5,586

5,586

31
32
33
34
35

liabilities

U.S. Government
Other
Time:
Interbank
Other

36
37

Borrowings
Total capital accounts 2

38

MEMO: Number of banks.

and

1
Includes items not shown separately.
Effective Mar. 31, 1976, some of the item "reserve for loan losses"
and all of the item "unearned income on loans" are no longer reported
as liabilities. As of that date the "valuation" portion of "reserve for
loan losses" and the "unearned income on loans" have been netted
against "other assets," and against "total assets" as well.
Total liabilities continue to include the deferred income tax portion of
"reserve for loan losses."
2
Effective Mar. 31, 1976, includes "reserves for securities" and the
contingency portion (which is small) of "reserve for loan losses."
3
Figures partly estimated except on call dates.




NOTE.—Figures include all bank-premises subsidiaries and other significant majority-owned domestic subsidiaries.
Commercial banks: All such banks in the United States, including
member and nonmember banks, stock savings banks, nondeposit trust
companies, and U.S. branches of foreign banks.
Member banks: The following numbers of noninsured trust companies
that are members of the Federal Reserve System are excluded from member banks in Tables 1.24 and 1.25 and are included with noninsured banks
in Table 1.25: 1976—December, 11; 1978—January, 12.

Commercial

Banks

A17

1.25 COMMERCIAL BANK ASSETS AND LIABILITIES Call-Date Series
Millions of dollars, except for number of banks
1977

1976

1978

1976

June 30

Dec. 31

1977

1978

Account
June 30

Dec. 31

Dec. 31

1
Net
Investments:
U.S. Treasury securities

June 30

827,696

854,733

914,779

956,431

476,610

488,240

523,000

542,218

578,734
560,077

601,122
581,143

657,509
636,318

695,443
672,207

340,691
329,971

351,311
339,955

384,722
372,702

403,812
390,630

101,461
147,500
129,562

100,568
153,042
130,726

99,333
157,936
159,264

97,001
163,986
157,393

55,727
80,191
76,072

53,345
83,583
74,641

52,244
86,033
92,050

50,519
87,886
90,728

Loans:

4
5
6

Dec. 31

National (all insured)

Total insured

2
3

June 30

583,304

599,743

651,360

671,166

825,003

847,372

922,657

945,874

469,377

476,381

520,167

526,932

3,022
44,064
285,200

2,817
44,965
284,544

7,310
49,843
319,873

7,956
47,203
312,707

1,676
23,149
163,346

1,632
22,876
161,358

4,172
25,646
181,821

4,483
22,416
176,025

12
13

8,248
484,467

7,721
507,324

8,731
536,899

8,987
569,020

4,907
276,296

4,599
285,915

5,730
302,795

5,791
318,215

14
15

75,291
72,061

81,137
75,502

89,339
79,082

98,351
83,074

54,421
41,319

57,283
43,142

63,218
44,994

68,948
47,019

16

14,397

14,425

14,397

14,381

4,735

4,701

4,654

4,616

7
8
Demand:
9
10
11

1,003,970 1,040,945 1,129,712 1,172,772

Time:

State member (all insured)

Insured nonmember

144,000

144,597

152,514

157,464

207,085

221,896

239,265

256,749

102,277
99,474

102,117
99,173

110,243
107,205

115,736
112,470

135,766
130,630

147,694
142,015

162,543
156,411

175,894
169,106

18,849
22,874
32,859

19,296
23,183
35,918

18,179
24,091
42,305

16,886
24,841
43,057

26,884
44,434
20,631

27,926
46,275
20,166

28,909
47,812
24,908

29,595
51,259
23,606

189,579

195,452

210,442

217,384

231,086

245,748

267,910

284,221

149,491

152,472

163,436

167,403

206,134

218,519

239,053

251,539

429
19,295
52,204

371
20,568
52,570

1,241
22,346
57,605

1,158
23,117
55,550

917
1,619
69,648

813
1,520
70,615

1,896
1,849
80,445

2,315
1,669
81,131

2,384
75,178

2,134
76,827

2,026
80,216

2,275
85,301

956
132,993

988
144,581

973
153,887

920
165,502

30
31

17,310
13,199

19,697
13,441

21,736
14,182

23,167
14,670

3,559
17,542

4,155
18,919

4,384
19,905

6,235
21,384

32

1,023

1,019

1,014

1,005

8,639

8,705

8,729

8,760

17
Loans:
18
19

Net
Investments:
U.S. Treasury securities

20
21
22
23
24

Demand:
25
26
27
Time:
28
29

Other

Noninsured nonmember
18,819

33
Loans:

22,940

24,415

Total nonmember
28,699

225,904

244,837

263,681

285,448

185,230
178,896

202,641
195,655

16,336
16,209

20,865
20,679

22,686
22,484

26,747
26,548

152,103
146,840

168,559
162,694

1,054
1,428
6,496

993
1,081
8,330

879
849
9,458

869
1,082
9,360

27,938
45,863
27,127

28,919
47,357
28,497

29,788
48,662
34,367

30,465
52,341
32,967

39

26,790

33,390

36,433

42,279

257,877

279,139

304,343

326,501

40

13,325

14,658

16,844

19,924

219,460

233,177

255,898

271,463

4
1,277
3,236

8
1,504
3,588

10
1,868
4,073

8
2,067
4,814

921
2,896
72,884

822
3,025
74,203

1,907
3,718
84,518

2,323
3,736
85,946

44
45

1,041
7,766

1,164
8,392

1,089
9,802

1,203
11,831

1,997
140,760

2,152
152,974

2,063
163,690

2,123
177,334

46
47

4,842
818

7,056
893

6,908
917

8,413
962

8,401
18,360

11,212
19,812

11,293
20,823

14,649
22,346

275

293

310

317

8,914

8,998

9,039

9,077

34
35

Net
Investments:
U.S. Treasury securities

36
37
38

Demand:
41
42
43

Other
Time:

MEMO: Number of banks

48
1

Includes items not shown separately.




For Note see Table 1.24.

A18

DomesticNonfinancialStatistics • January 1979

1.26 COMMERCIAL BANK ASSETS AND LIABILITIES Detailed Balance Sheet, June 30, 1978
Millions of dollars, except for number of banks.
Member banks 1
Asset account

All
Insured
commercial commercial
banks
banks

Large banks
Total
New York
City

1 Cash bank balances, items in process
2
Currency and coin
3
Reserves with Federal Reserve Banks
4
Demand balances with banks in United States
5
Other balances with banks in United S t a t e s . . .
6
Balances with banks in foreign countries
7
Cash items in process of collection
8 Total securities held—Book value
9
U.S. Treasury
10
Other U.S. government agencies
11
States and political subdivisions
12
All other securities
13
Unclassified total
14

15
16
17
18
19
20

21
22
23
24

Trading-account

All other
City of
Chicago

Other
large 2

166,754
11,950
29,574
43,092
6,779
6,093
69,266

157,393
11,883
29,566
38,158
5,007
3,588
69,192

133,786
8,691
29,566
23,166
2,775
3,110
66,478

40,354
795
4,104
10,382
520
439
24,113

5,594
190
1,537
248
5
384
3,231

48,783
2,878
12,499
3,539
782
1,484
27,602

39,054
4,828
11,426
8,996
1,468
803
11,533

261,272
97,872
39,847
117,257
6,204
92

259,360
97,002
39,486
117,018
5,767

178,753
67,406
25,193
82,541
3,549
64

20,609
9,623
1,800

7,979
2,955
1,353
3,480
191

57,297
22,215
7,362
26,626
1,071
23

92,868
32,613
14,678
43,554
1,981
41

8,881

305

securities

7,160

7,156

7,010

3,026

U.S. Treasury
Other U.S. government agencies
States and political subdivisions
All other trading account securities
Unclassified

4,062
986
1,676
345
92

978

2,756

4,062
986
1,676
345

4,044
976
1,657
270
64

1,907
428
610
82

713
80
133
52

1,352
423
824
133
23

Bank investment

portfolios

U.S. Treasury
Other U.S. government agencies
States and political subdivisions
All other portfolio securities

25 Federal Reserve stock and corporate stock
26 Federal funds sold and securities resale agreement.
27
Commercial banks
28
Brokers and dealers
29
Others
30 Other loans, gross
31
LESS: Unearned income on loans
32
Reserves for loan loss
33
Other loans, net

254,112

252,204

93,810
38,861
115,582
5,859

92,940
38,499
115,343
5,422

171,743

63,362
24,217
80,884
3,279

17,583

7,716
1,373
8,271
223

251

72
45
90
3
41

7,002

54,541

92,617

2,242
1,273
3,347
139

20,863
6,939
25,802
938

32,541
14,633
43,464
1,979

1,669

1,628

1,380

309

105

491

475

48,576
41,068
4,962
2,546

43,768
36,621
4,954
2,193

34,495
27,517
4,847
2,131

4,309
2,321
1,514
474

1,616
1,300
235
80

17,935
13,996
2,528
1,411

10,636
9,899
569
167

673,615
16,142
7,293
650,180

651,675

7,150
628,439

485,054
10,768
5,680
468,606

76,423
620
1,297
74,506

25,479
104
325
25 049

184,099
3,521
2,155
178,424

199,053
6,524
1,902
190,628

192,877

192,609

131,891

23,658
8,208
110,293

23,639
8,189
110,113

104,952

104,793

16,086

Other loans, gross, by category
34

35
36
37
38

Real estate loans

Construction and land development
Secured by farmland
Secured by residential properties
1- to 4-family

39
40
41

42
43
44

residences

FHA-insured or VA-guaranteed
Conventional
Multifamily

residences.

FHA-insured
Conventional
Secured by other properties

45

Loans

46
47
48
49
50
51
52
53
54

REITs and mortgage companies
Domestic commercial banks
Banks in foreign countries
Other depository institutions
Other financial institutions
Loans to security brokers and dealers
Other loans to purchase or carry securities
Loans to farmers—except real estate
Commercial and industrial loans

55

Loans to individuals

56

57
58
59
60
61
62
63
64
65
66
67

to financial institutions

Instalment

loans

Passenger automobiles
Residential repair and modernization
Credit cards and related plans
Charge-account credit cards
Check and revolving credit plans
Other retail consumer goods
Mobile homes
Other
Other instalment loans
Single-payment loans to individuals
All other loans

68 Total loans and securities, net
69
70
71
72
73

Direct lease financing
Fixed assets—Buildings, furniture, real e s t a t e . . .
Investment in unconsolidated subsidiaries
Customer acceptances outstanding
Other assets

74 Total assets
For notes see opposite page.




9,629

17,684
3,565
76,832

2,678

2,391
23
4,891

49,324

70,260

630
8
1,426

8,586
405
28.984

6,076
3,129
41,531

1,331

27,608

39,816

42
1,289

3,395
24,213

2,474
37,342

72,964

4,209

7,496
97,457

7,423
97,370

6,430
66,534

519
3,690

5,341

5,320

3,869

399
4,941
50,719

395
4,926
50,667

327
3,541
33,810

44,426

35,472

33,355

8,348
5,263
12,864
1,480
16,471
11,716
4,425
27,018
221,591

8,341
3,116
6,610
1,458
15,948
11,340
4,337
26,993
210,907

7,949
2,398
6,447
1,312
15,249
11,043
3,604
14,813
170,678

153,582

153,458

105,611

124,139

124,066

683

120
563
2,324
11,483

2,114
702
2,931
240
5,496
6,567
403
161

38,588

95

25
70
614
4,015

812
123
272
53
2,755
1,457
294
178
13,149

1,376

87
1,289
11,349
14.985

4,369
1,307
2,648
775
5,886
2,706
1,896
3,630
67,555

1,714

96
1,619
19,523
2,873

654
265
596
245
1.113
313
1,011
10,844
51,387

6,686

334

37,998

58,592

85.515

5,041

505

55,757
7,956
20,136
16,185
3,951
18,752
9,387
9,365
21,539
29,443
17,979

31,323

47,646

55,740
7,955
20,125
16,184
3,941
18,747
9,387
9,360
21,498
29,392
16,559

35,523
5,203
17,766
14.516
3,249
12,722
6,553
6,169
14,301
20,096
14,059

994
305
2,214
1,424
791
395
171
225
1,132
1,646
2,906

179
77
068
027
41
54
19
35
128
829
373

10,746
1,912
9,069
7,617
1,453
4,843
2,471
2,372
4,752
6,675
6,005

23,605
2,909
5,414
4,449
965
7,430
3,892
3,537
8,288
10,946
3,774

961,697

933,196

683,234

99,mi

34,749

254,146

294,607

6,303
22,318
3,146
16,489
38,347

6,302
22,191
3,109
15,293
35,288

5,918
16,454
3,069
14,788
31,300

1,106
2,390
1.546
7,399
12,779

98
793
182
1,089
1,241

3,669
6,215
1,240
5,908
12,456

1,045
7,056
101
392
4,824

,215,052

1,172,773

888,551

165,307

43,748

332,417

347,080

Commercial Banks

A19

1.26 Continued

M ember bank s i
Liability or capital account

All
Insured
commercial commercial
banks
banks

Total
New York
City

75 Demand deposits
76
Mutual savings banks
77
Other individuals, partnerships, and corpora78
79
80
81
82
83

U.S. government
States and political subdivisions
Foreign governments, central banks, e t c . . . . . .
Commercial banks in United States
Banks in foreign countries
Certified and officers' checks, etc

84 Time deposits
86
87

Mutual savings banks
Other individuals, partnerships, and corpora-

88
89
90
91
92

U.S. government
States and political subdivisions
Foreign governments, central banks, etc
Commercial banks in United States
Banks in foreign countries

93 Savings deposits
94
Individuals and nonprofit organizations
95
Corporations and other profit organizations..
97
98

States and political subdivisions
All other

99 Total deposits
100 Federal funds purchased and securities sold under
agreements to repurchase
101
Commercial banks
102
Brokers and dealers
103
Others
104 Other liabilities for borrowed money
105 Mortgage indebtedness
106 Bank acceptances outstanding
107 Other liabilities
108 Total liabilities
109 Subordinated notes and debentures
110 Equity capital
Ill
Preferred stock
112
Common stock
113
Surplus
114
Undivided profits
115
Other capital reserves
116 Total liabilities and equity capital
MEMO ITEMS:

Nonmember
banks 1

Large banks
City of
Chicago

Other
large 2

All other

374,758
1,626

367,867
1,425

282,751
1,217

65,198
588

10,932
1

100,994
291

105,627
337

92,006
409

279,829
7,964
18,210
1,840
38,924
8,721
17,643

278,459
7,956
18,138
1,351
37,963
7,815
14,760

206,399
5,641
12,421
1,317
36,639
7,679
11,440

33,292
584
830
1,084
18,730
6,007
4,083

7,802
187
184
25
2,147
225
361

78,702
2,043
3,564
170
11,503
1,249
3,473

86,603
2,828
7,842
37
4,260
198
3,522

73,430
2,323
5,789
524
2,285
1,042
6,204

365,015
90
292

353,571
90
275

257,007
72
263

37,850

15,695

115

37

93,735
1
90

109,727
71
20

108,008
18
29

287,380
989
56,273
10,171
7,968
1,853

280,154
989
55,928
7,429
7,352
1,354

202,808
793
38,077
7,193
6,645
1,156

29,149
82
1,672
4,184
1,917
730

12,118
39
1,261
1,201
911
128

72,205
421
16,031
1,684
3,113
190

89,336
251
19,113
123
705
108

84,572
195
18,195
2,979
1,323
697

226,026
210,453
10,807
62
4,501
204

224,436
209,067
10,787
62
4,486
35

154,577
144,198
7,431
53
2,863
31

10,945
10,150
504

2,758
2,612
137

55,474
51,865
3,091
16
494
9

85,401
79,572
3,699
36
2,087
7

71,449
66,255
3,376
9
1,638
172

965,799

945,875

694,335

113,992

29,385

250,204

300,755

271,464

93,179
46,947
13.356
32,876
13,586
1,738
17,125
33,773

88,903
43,727
13,289
31,887
9,448
1,733
15,925
22,062

83,003
41,154
12,325
29,524
9,112
1,425
15,419
19,126

20,103
7,773
3,199
9,132
3,398
233
8,014
5,911

8,989
5,904
1,897
1,188
179
28
1,095
1,106

40,575
21,697
5,686
13,192
4,243
698
5,916
8,051

13,336
5,780
1,543
6,013
1,292
465
394
4,057

10,176
5,793
1,030
3,352
4,473
313
1,705
14,647

1,125,200

1,083,946

822,421

151,651

40,782

309,688

320,299

302,779

5,816

5,753

4,440

1,004

80

2,061

1,296

1,376

84,037
88
17,790
32,386
31,949
1,824

83,074
81
17,691
31,874
31,684
1,744

61,690
33
12,743
22,906
24,803
1,205

12,652

2,885

2,645
4,451
5,334
132

570
1,404
859
52

20,668
2
3,997
8,063
8,238
368

25,485
31
5,531
8,898
10,372
652

22,347
55
5,047
9,480
7,146
619

1,215,052

1,172,773

888,551

165,307

43,748

332,417

347,080

326,501

258,603

273
16

9
*

117 Demand deposits adjusted 2
Average for last 15 or 30 days:
118
Cash and due from bank
119
Federal funds sold and securities purchased
under agreements to resell
120
Total loans
121
Time deposits of $ 100,000 or more
122
Total deposits
123
Federal funds purchased and securities sold
under agreements to repurchase
124
Other liabilities for borrowed money

252,756

173,993

21,771

5,368

59,847

87,007

84,610

151,066

142,173

121,518

35,452

5,619

44,611

35,836

29,548

53,196
647,386
181,510
941,481

47,463
628,167
174,479
923,749

36,121
468,342
143,050
675,725

5,530
74,085
31,979
106,594

1,901
24,972
12,833
28,441

16,558
178,557
61,496
243,663

12,132
190,728
36,742
297,026

17,075
179,043
38,459
265,756

95,273
13,002

90,853
8,533

85,358
8,027

21,859
3,433

9,825
171

40,469
3,437

13,205
986

9,915
4,975

125 Standby letters of credit outstanding
126 Time deposits of $100,000 or more
127
Certificates of deposit
128
Other time deposits

18,948
183,339
155,925
27,414

17,750
177,602
151,931
25,671

16,686
145,695
123,685
22,001

9,406
32,476
28,200
4,277

1,269
13,253
11,450
1,803

4,796
62,711
52,439
10,271

1,215
37,245
31,595
5,650

2,262
37,653
32,240
5,413

14,698

14,381

5,621

12

9

153

5,447

9,077

129 Number of banks

1
Member banks exclude and nonmember banks include 13 noninsured
trust companies that are members of the Federal Reserve System.
2
Demand deposits adjusted are demand deposits other than domestic
commercial interbank and U.S. government, less cash items reported
as in process of collection.




NOTE.—Data include consolidated reports, including figures for all
bank-premises subsidiaries and other significant majority-owned domestic subsidiaries. Securities are reported on a gross basis before deductions of valuation reserves. Back data in lesser detail were shown in
p r e v i o u s BULLETINS.

A20

DomesticNonfinancialStatistics • January 1979

1.27 ALL LARGE WEEKLY REPORTING COMMERCIAL BANKS Assets and Liabilities
Millions of dollars, Wednesday figures
1978
Account

1 Total loans and investments
Loans:
2

Federal funds

3

sold1

To commercial banks
To brokers and dealers involving—
U.S. Treasury securities
Other securities
To others

4
5
6

Nov. 1

Nov. 8

Nov. 15

Nov. 22

Nov. 29

Dec. 6p

Dec. 13p

Dec. 20p

Dec. TIP

486,481

494,814

492,405

490,818

490,351

493,087

492,231

502,173

503,617

24,647

31,524

26,884

26,524

26,769

28,511

18,200

24,306

20,013

19,912

26,147

31,310

20,867

19,547

31,095

19,008

23,512

24,926

2,894
748
2,805

4,219
722
2,277

3,824
778
2,269

3,609
851
2,152

3,159
784
1,959

5,677
860
2,427

4,015
800
2,324

4,819
959
2,020

3,049
1,092
2,028

7

Other,

361,633

363,030

363,934

363,449

363,297

364,408

8
9

Commercial and industrial
Agricultural
For purchasing or carrying securities:
To brokers and dealers:
U.S. Treasury securities
Other securities
To others:
U.S. Treasury securities
Other securities
To nonbank financial institutions:
Personal and sales finance cos., etc
Other
Real estate
To commercial banks:
Domestic
Foreign
Consumer instalment
Foreign govts., official institutions, etc
All other loans
LESS: Loan loss reserve and unearned income
on loans

139,951
5,371

140,390
5,338

140,813
5,368

364,846

140,612
5,320

369,513

370,991

140,658
5,295

140,655
5,255

140,557
5,248

141,829
5,276

142,103
5,352

1,133
9,160

1,641
8,358

1,716
8,100

1,292
7,521

850
7,377

1,654
7,090

1,571
6,982

1,339
8,117

772
7,791

109
2,570

111
2,590

109
2,596

111
2,582

111
2,559

104
2,568

112
2,583

123
2,593

129
2,594

8,872
15,820
87,716

8,752
15,888
87,926

8,780
15,748
88,454

8,447
15,601
88,825

8,499
15,620
89,013

8,600
15,642
89,247

8,502
15,807
89,630

8,976
15,815
89,904

9,192
15,857
90,212

2,674
7,860
55,211
1,969
23,217

3,115
8,554
55,311
2,059
22,997

2,796
8,352
55,731
2,117
23,254

2,908
8,498
55,958
2,118
23,656

3,112
8,434
56,287
2,177
23,305

2,947
8,554
56,455
2,047
23,590

2,768
8,757
56,776
2,168
23,385

3,149
9,161
57,314
2,081
23,836

3,415
9,684
57,760
2,151
23,979

Other

350,631

351,955

352,800

352,242

352,084

353,170

353,559

358,199

359,740

41,483

41,333

42,421

41,637

41,317

41,075

41,324

41,383

41,511

10
11
12
13
14
15
16
17
18
19
20
21
22
23

gross

loans, net.

.

11,002

11,075

11,134

11,207

11,213

11,238

11,287

11,314

11,251

Investments:
24

U.S.

25

Treasury

securities..

Bills
Notes and bonds, by maturity:
Within 1 year
1 to 5 years
After 5 years

26
27
28

3,328

3,252

3,072

3,215

3,136

3,055

3,431

3,665

3,880

7,179
25,497
5,479

7,348
25,272
5,461

7,314
25,859
6,176

7,472
24,979
5,971

7,585
24,704
5,892

7,775
24,417
5,828

7,793
24,340
5,760

7,921
24,056
5,741

7,979
23,939
5,713

69,720

70,002

70,300

70,415

70,181

70,331

71,201

71,281

71,271

6,523
45,697

6,480
46,042

6,599
46,245

6,411
46,350

6,277
46,342

6,166
46,246

6,454
46,454

6,128
46,554

6,022
46,573

32
33

Obligations of States and political
subdivisions:
Tax warrants, short-term notes, and
bills
Allother
Other bonds, corporate stocks, and
securities:
Certificates of participation2
All other, including corporate stocks...

2,897
14,603

2,882
14,598

2,925
14,531

2,876
14,778

2,942
14,620

2,953
14,966

3,031
15,262

3,029
15,570

3,095
15,581

34
35
36
37
38
39

Cash items in process of collection
Reserves with Federal Reserve Banks
Currency and coin
Balances with domestic banks
Investments in subsidiaries not consolidated...
Other assets

50,704
22,677
6,554
16,091
3,490
66,245

49,019
20,512
6,485
18,057
3,482
68,847

51,484
21,370
6,814
15,588
3,453
69,566

49,442
23,536
6,549
16,063
3,515
69,610

46,720
24,876
7,754
15,598
3,498
68,465

47,571
21,711
6,895
16,668
3,494
68,686

48,515
26,007
7,442
16,286
3,425
69,079

52,071
23,764
7,478
16,505
3,450
69,447

55,835
30,276
8,167
18,121
3,506
70,415

652,242

661,216

660,680

659,533

657,262

658,112

662,985

674,888

689,937

201,316

204,723

203,106

193,786

191,693

196,902

143,544
6,709
1,304

141,888
5,559
1,038

146,071
6,674
1,559

140,371
5,879
977

198,861

138,612
5,672
952

208,086

141,194
5,672
1,121

212,468

144,949
5,624
1,031

147,468
6,099
2,991

151,617
6,220
1,082

31,091
955

38,541
953

31,054
873

30,196
773

29,773
711

32,424
856

29,883
705

32,788
740

35,449
766

1,606
6,838
9,269

1,314
7,421
8,009

1,402
6,934
8,539

1,297
6,740
7,553

1,354
6,465
8,154

1,306
6,375
7,954

1,961
7,014
7,694

1,535
7,846
8,619

1,705
8,251
7,378

29

Other

30
31

securities

40 Total assets/total liabilities
Deposits:
41

Demand

42
43
44

deposits

Individuals, partnerships, and corporations
States and political subdivisions
U.S. Government
Domestic interbank:
Commercial
Mutual savings
Foreign:
Governments, official institutions, etc...,
Commerial banks
Certified and officers' checks

45
46
47
48
49
50

Time

and savings

3

deposits

Savings 4
*
Time:
Individuals, partnerships, and corps.
States and political subdivisions
Domestic interbank
Foreign govts., official institutions, etc..,

51
52
53
54
55
56

57 Federal funds purchased, etc. 5
Borrowings from:
58
Federal Reserve Banks
59
Others
60 Other liabilities, etc. 6
61 Total equity capital and
subordinated
notes/debentures7
1

276,645

278.057

279,234

281,053

280,971

282,086

90,892
185,753
143,885
26,530
7,134
6,503

90,999
187.058
144,813
26,802
7,191
6,589

90,495
188,739
146,354
26,626
7,437
6,623

90,276
190,777
147,863
27,048
7,525
6,645

90,047
190,924
148,287
26,809
7,644
6,487

284,094

284,106

90,052
192,034
149,557
26,726
7,784
6,236

284,124

89,729
194,365
151,408
27,051
8,086
6,156

89,413
194,693
151,606
26,960
8,296
6,205

89,628
194,496
151,727
26,809
8,268
6,088

81,815

83,824

81,344

84,751

84,899

82,114

83,492

80,763

86,359

1,123
8,136
35,684

470
10,059
36,481

945
10,737
37,801

594
14,226
37,573

795
12,818
38,438

237
10,088
38,882

134
9,648
38,826

177
14,910
39,118

2,647
16,862
39,562

47,523

47,602

47,513

47,550

47,648

47,803

47,930

47,728

47,915

Includes securities purchased under agreements to resell.
2 Federal agencies only.
3
Includes time deposits of U.S. Govt, and of foreign banks, which are
not4 shown separately.
For amounts of these deposits by ownership categories, see Table 1.30.




5

Includes securities sold under agreements to repurchase.
6 Includes minority interest in consolidated subsidiaries and deferred
tax7 portion of reserves for loans.
Includes reserves for securities and contingency portion of reserve
for loans.

Weekly Reporting

Banks

A21

1.28 LARGE WEEKLY REPORTING COMMERCIAL BANKS IN NEW YORK CITY Assets and Liabilities
Millions of dollars, Wednesday figures
1978

1 Total loans and investments....
Loans
Federal

sold1

funds

To commercial banks
To brokers and dealers involving—
U S Treasury securities
Other securities
To others
Other

gross....

. .

.

.

Commercial and industrial
Agricultural
For purchasing or carrying securities
To brokers and dealersU S Treasury securities
Other securities
To others
U S. Treasury securities
Other securities...
To nonbank financial institutionsPersonal and sales finance cos., etc
Other...
Real estate...
To commercial banks •
Domestic
Foreign
Consumer instalment
Foreign govts official institutions, etc . . . .
All other loans
LESS Loan loss reserve and unearned income
on loans

10
12
13
14
15
16
17
18
19
20
21
22
23

Other

loans,

net

Nov 1

Nov 8

Nov 15

Nov 22

Nov 29

Dec. 6p

Dec. 13p

Dec. 20 p

Dec

99,672

101,323

100,781

100,092

99,600

98,979

99,469

103,188

103,075

4,843

6,131

5,101

5,946

6,351

4,449

4,416

6,056

5,580

2,265

3,949

2,736

3,835

4,511

2,662

2,418

4,598

4,310

1,374
6
1,198

1,479
10
693

1,788
14
563

1,647
9
455

1,464
2
374

1,353
3
431

1,500
7
491

1,253
42
163

1,082
6
182

77,294

77,765

77,557

76,466

75,966

77,133

77,143

79,558

79,863

38,234
181

38,390
185

38,547
189

38,269
189

38,114
189

38,506
188

38,564
189

39,375
197

39,506
192

1,025
4,683

1,407
4,025

1,543
4,133

1,180
3,756

759
3,739

1,565
3,614

1,469
3,610

1,170
4,466

690
4,005

27
354

27
340

27
340

27
338

27
333

27
338

27
339

28
340

28
341

3,301
4,778
9,856

3,170
4,757
9,875

3,123
4,530
9,921

2,868
4,441
9,982

2,966
4,506
9,964

3,002
4,466
9,974

2,913
4,538
10,011

3,117
4,592
10,045

3,326
4,530
10,109

851
3,803
5,042
529
4,630

1,212
4,226
5,059
527
4,565

941
3,829
5,250
550
4,634

877
3,931
5,285
582
4,741

1,077
3,783
5,293
644
4,572

1,064
3,834
5,343
524
4,688

948
3,967
5,373
631
4,564

1,102
4,316
5,547
589
4,674

1,356
4,761
5,656
660
4,703

1,910

Treasury

securities

Bills
Notes and bonds, by maturity:
Within 1 year
1 to 5 years
After 5 years
Other

32
33
34
35
36
37
38
39

securities

Obligations of States and political
subdivisions.
Tax warrants, short-term notes, and bills.
All other
Other bonds, corporate stocks, and
securities
Certificates of participation2
All other, including corporate stocks
Cash items in process of collection
Reserves with Federal Reserve Banks
Currency and coin
Balances with domestic banks
Investments in subsidiaries not consolidated...
Other assets

40 Total assets/total liabilities.
Deposits
41

Demand

42
43
44

75,854

8,276

8,261

45
46
47
48
49
50

Time

and savings

deposits3

Savings4
Time . . .
Individuals, partnerships and corps .
States and political subdivisions
Domestic interbank
Foreign govts , official institutions, etc...

51
52
53
54
55
56

781

751

741
5,749
1,005

835
5,721
954

11,169

57 Federal funds purchased, etc 5
Borrowings from
58
Federal Reserve Banks
59
Others
60 Other liabilities, etc 6
61 Total equity capital and subordinated notes/
debentures 7

11,077




1,943

1,953

1,962

1,985

1,980

1,961

74,523

74,013

75,171

75,158

17,578

77,902

8,934
111

8,436

8,283

8,332

8,567

8,532

8,633

875

797

841

1,163

1,254

1,349

844
5,819
1,494

849
5,315
1,397

933
5,176
1,377

873
5,298
1,320

945
5,171
1,288

976
5,024
1,278

1,023
4,983
1,278

11,121

11,187

10,953

11,027

11,328

11,022

10,960

1,677
6,994

1,783
6,992

1,722
7,004

1,630
6,998

1,533
7,031

1,675
7,079

1,518
7,062

1,430
7,080

520
1,883

521
1,885

521
1,825

520
1,941

518
1,807

518
1,945

532
2,042

525
1,917

517
1,933

16,825
4,698
1,014
8,990
1,819
25,933

17,060
8,374
1,029
10,621
1,843
27,322

16,251
5,890
1,068
8,051
1,852
27,414

15,545
5,052
981
8,753
1,853
28,768

15,911
5,533
1,137
8,105
1,852
27,524

15,350
5,804
1,091
9,218
1,854
26,994

15,418
7,400
1,186
8,936
1,842
27,590

16,860
7,392
1,160
8,355
1,842
26,980

17,735
9,275
1,235
9,350
1,848
27,690

158,951

167,572

161,307

161,044

159,662

159,290

161,841

165,777

170,208

63,258

55,780

54,016

53,398

54,623

55,036

59,961

29,381
438
114

29,758
628
158

28,570
474
75

27,828
424
77

28,324
441
97

29,179
394
127

61,291

29,727
747
82

30,036
454
672

30,624
462
100

15,110
469

22,733
515

14,634
448

15,319
375

15,209
345

16,201
418

14,638
324

17,143
351

19,049
375

1,346
4,899
4,547

1,052
5,393
3,632

1,173
5,170
3,811

1,068
5,005
3,130

1,088
4,607
3,820

1,068
4,575
3,499

1,726
5,060
3,588

1,258
5,897
4,150

1,444
6,364
2,873

48,108

48,518

49,828

50,290

50,161

50,491

50,782

50,915

50,685

9,392
38,716
29,372
2,061
2,642
3,822

9,390
39,128
29,586
2,099
2,788
3,848

9,343
40,485
30,478
2,122
3,094
3,942

9,323
40,967
30,853
2,138
3,133
4,022

9,296
40,865
30,864
2,102
3,149
3,925

9,291
41,200
31,308
2,046
3,182
3,833

9,301
41,481
31,564
2,009
3,266
3,821

9,246
41,669
31,695
1,976
3,427
3,800

9,270
41,415
31,574
1,936
3,386
3,756

20,149

22,093

20,180

21,391

21,381

20,097

22,541

20,000

20,879

480
4,329
15,537
13,421

4,771
15,507

716
5,039
16,332

13,425

13,432

*

1 Includes securities purchased under agreements to resell.
Federal agencies only.
Includes time deposits of U.S. Govt, and of foreign banks, which
are not shown separately.
4 For amounts of these deposits by ownership categories, see Table 1.30.
2
3

1,932
75,625

1,829
6,937

56,927

deposits

Individuals, partnerships, and corporations
States and political subdivisions
U S Government
Domestic interbank:
Commercial
Mutual savings
Foreign
Governments, official institutions, e t c —
Commercial banks
Certified and officers' checks

1,911

75,384

Investments
U S

21*

*

5,694
16,215

189
5,112
15,973

4,585
15,987

4,420
15,549

5,672
15,812

1,403
5,639
16,845

13,438

13,448

13,507

13,513

13,417

13,466

*

*

*

5 Includes securities sold under agreements to repurchase.
6 Includes minority interest in consolidated subsidiaries and deferred
tax portion of reserves for loans.
7 Includes reserves for securities and contingency portion of reserves
for loans.

A22

DomesticNonfinancialStatistics • January 1979

1.29 LARGE WEEKLY REPORTING COMMERCIAL BANKS OUTSIDE NEW YORK CITY
Assets and Liabilities
Millions of dollars, Wednesday figures
1978

1 Total loans and investments.
Loans:
Federal funds

sold1

To commercial banks
To brokers and dealers involving—
U.S. Treasury securities
Other securities
To others

12
13
14
15
16
17
18
19
20
21
22
23

Nov. 8

Nov. 15

Nov. 22

Nov. 29

Dec. 6p

Dec. 13 p Dec. 20p

Dec. 27p

386,809

393,491

391,624

390,726

390,751

394,108

392,762

398,985

400,542

19,804

25,393

21,783

20,578

20,418

24,062

15,935

17,277

16,077

21,731

20,357

25,254

16,356

16,885

25,515

16,590

18,914

20,616

1,520
742
1,607

2,740
712
1,584

2,036
764
1,706

1,962
842
1,697

1,695
782
1,585

4,324
857
1,996

2,515
793
1,833

3,566
917
1,857

1,967
1,086
1,846

284,339

285,265

286,377

286,983

287,331

287,275

101,717
5,190

102,000
5,153

102,266
5,179

102,343
5,131

102,544
5,106

287,703

Commercial and industrial
Agricultural
For purchasing or carrying securities:
To brokers and dealers:
U.S. Treasury securities
Other securities
To others:
U.S. Treasury securities
Other securities
To nonbank financial institutions:
Personal and sales finance cos., etc
Other
Real estate
To commercial banks:
Domestic
Foreign
Consumer instalment
Foreign govts., official institutions, etc
All other loans
LESS: Loan reserve and unearned income on
loans

102,149
5,067

289,955

291,128

101,993
5,059

102,454
5,079

102,597
5,160

108
4,477

234
4,333

173
3,967

112
3,765

91
3,638

89
3,476

102
3,372

169
3,651

82
3,786

82
2,216

84
2,250

82
2,256

84
2,244

84
2,226

77
2,230

85
2,244

95
2,253

101
2,253

5,571
11,042
77,860

5,582
11,131
78,051

5,657
11,218
78,533

5,579
11,160
78,843

5,533
11,114
79,049

5,598
11,176
79,273

5,589
11,269
79,619

5,859
11,223
79,859

5,866
11,327
80,103

1,823
4,057
50,169
1,440
18,587

1,903
4,328
50,252
1,532
18,432

1,855
4,523
50,481
1,567
18,620

2,031
4,567
50,673
1,536
18,915

2,035
4,651
50,994
1,533
18,733

1,883
4,720
51,112
1,523
18,902

1,820
4,790
51,403
1,537
18,821

2,047
4,845
51,767
1,492
19,162

2,059
4,923
52,104
1,491
19,276

Other

275,247

276,101

277,175

277,719

278,071

277,999

278,401

280,621

281,838

33,207

33,072

33,487
2,295

33,201

33,034

32,743

32,757

32,851

32,878

2,340

2,339

2,214

2,268

2,411

2,531

Other,

10
11

Nov. 1

gross

loans, net

9,092

9,164

9,202

9,264

9,260

9,276

9,302

9,334

9,290

Investments:
U.S.

Treasury

securities

Bills
Notes and bonds, by maturity:
Within 1 year
1 to 5 years
After 5 years
Other

30
31
32
33
34
35
36
37
38
39

securities

Obligations of States and political subdivisions:
Tax warrants, short-term notes, and bills.
Allother
Other bonds, corporate stocks, and
securities:
Certificates of participation 2 . . .
All other, including corporate stocks
Cash items in process of collection
Reserves with Federal Reserve Banks
Currency and coin
Balances with domestic banks
Investments in subsidiaries not consolidated
Other assets

40 Total assets/total liabilities.

2,547

2,501

6,438
19,748
4,474

6,513
19,551
4,507

6,470
20,040
4,682

6,623
19,664
4,574

6,652
19,528
4,515

6,902
19,119
4,508

6,848
19,169
4,472

6,956
18,956
4,435

58,551

58,925

59,179

6,945
19,032
4,463

59,228

59,228

59,304

59,873

60,259

60,311

4,694
38,760

4,803
39,048

4,816
39,253

4,689
39,346

4,647
39,344

4,633
39,215

4,779
39,375

4,610
39,492

4,592
39,493

2,377
12,720

2,361
12,713

2,404
12,706

2,356
12,837

2,424
12,813

2,435
13,021

2,499
13,220

2,504
13,653

2,578
13,648

33,879
17,979
5,540
7,101
1,671
40,312

31,959
12,138
5,456
7,436
1,639
41,525

35,233
15,480
5,746
7,537
1,601
42,152

33,897
18,484
5,568
7,310
1,662
40,842

30,809
19,343
6,617
7,493
1,646
40,941

32,221
15,907
5,804
7,450
1,640
41,692

33,097
18,607
6,256
7,350
1,583
41,489

35,211
16,372
6,318
8,150
1,608
42,467

38,100
21,001
6,932
8,771
1,658
42,725

493,291

493,644

499,373

498,489

497,600

498,822

501,144

509,111

519,729

144,389

141,465

147,326

139,770

112,507
5,121
924

116,313
6,046
1,401

138,295

142,279

113,817
5,962
1,222

143,825

148,125

151,177

111,801
5,405
902

110,784
5,248
875

112,870
5,231
1,024

115,770
5,230
904

117,432
5,645
2,319

120,993
5,758
982

15,981
486

15,808
438

16,420
425

14,877
398

14,564
366

16,223
438

15,245
381

15,645
389

16,400
391

260
1,939
4,722

262
2,028
4,377

229
1,764
4,728

229
1,735
4,423

266
1,858
4,334

238
1,800
4,455

235
1,954
4,106

277
1,949
4,469

261
1,887
4,505

Deposits:
Demand

deposits

Individuals, partnerships, and corporations.
States and political subdivisions
U.S. Government
Domestic interbank:
Commercial
Mutual savings
Foreign:
Governments, official institutions, etc
Commercial banks
Certified and officers' checks
Time and savings

deposits

3

Savings 4
Time
Individuals, partnerships, and corps
States and political subdivisions
Domestic interbank
Foreign govts., official institutions, etc...

57 Federal funds purchased, etc. 5
Borrowings from:
58
Federal Reserve Banks
59
Others
60 Other liabilities, etc.6
61 Total equity capital and subordinated
notes/debentures 7
1
2
3

228,537

229,539

229,406

230,763

81,500
147,037
114,513
24,469
4,492
2,681

230,810

231,595

233,439

81,152
148,254
115,876
24,504
4,343
2,681

80,953
149,810
117,010
24,910
4,392
2,623

233,312

233,191

81,609
147,930
115,227
24,703
4,403
2,741

80,751
150,059
117,423
24,707
4,495
2,562

80,761
150,834
118,249
24,680
4,602
2,403

80,428
152,884
119,844
25,042
4,820
2,335

80,167
153,024
119,911
24,984
4,869
2,405

80,358
153,081
120,153
24,873
4,882
2,332

61,666

61,731

61,164

63,360

63,518

62,017

60,951

60,763

65,480

643
3,807
20,147

470
5,288
20,974

229
5,698
21,469

594
8,532
21,358

606
7,706
22,465

237
5,503
22,895

134
5,228
23,277

177
9,238
23,306

22,in

34,102

34,177

34,081

34,112

34,200

34,296

34,417

34,311

34,449

Includes securities purchased under agreements to resell.
Federal agencies only.
Includes time deposits of U.S. Govt, and of foreign banks, which
are not shown separately.
4
For amounts of these deposits by ownership categories, see Table 1.30.




1,244
11,223

5 Includes securities sold under agreements to repurchase.
6 Includes minority interest in consolidated subsidiaries and deferred
tax portion of reserves for loans.
7
Includes reserves for securities and contingency portion of reserves
for loans.

Weekly Reporting
1.30 LARGE WEEKLY REPORTING COMMERCIAL BANKS

Banks

A23

Balance Sheet Memoranda

Millions of dollars, Wednesday figures
1978
Nov. 1
Total loans (gross) and investments adjusted
1

2
3

Large

Nov. 8

Nov. 15

Nov. 22

Nov. 29

Dec. 6p

Dec. 13 p Dec. 20p

Dec. 21p

1

Banks

New York City banks
Banks outside New York City

476,609

478,468

480,730

479,205

477,585

481,831

481,742

486,826

98,466
378,143

98,073
380,395

99,036
381,694

97,323
381,882

95,965
381,620

97,215
384,616

98,088
383,654

486,527

99,468
387,358

99,370
387,157

365,406

367,133

368,009

367,153

366,087

370,425

369,217

374,162

79,021
286,385

78,735
288,398

78,981
289,028

77,700
289,453

76,729
289,358

373,745

77,856
292,569

78,193
291,024

79,914
294,248

79,777
293,968

118,217

116,125

119,009

113,171

114,248

115,786

119,432

120,236

120,102

Total loans (gross), adjusted
4

5
6

Large

banks

New York City banks
Banks outside New York City
Demand deposits, adjusted2

7

8
9

Large

Banks

New York City banks
Banks outside New York City

Large negotiable time3 CD's included in time and
savings deposits
Total:
10 Large banks
11
New York City
12
Banks outside New York City
Issued to IPC's:
13

14
15

Large

banks

New York City Banks
Banks outside New York City
Issued to others:

24,910
93,307

92,11A

24,737
94,272

23,077
90,094

22,201
92,047

22,975
92,811

24,853
94,579

25,286
94,950

24,407
95,695

94,306
26,956
67,350

95,428
27,382
68,046

96,673
28,606
68,067

97,589
29,003
68,586

91

M l

98,322
29,180
69,142

100,172
29,428
70,744

100,248
29,597
70,651

99,991
29,358
70,633

67,286

68,122

69,154

69,992

70,269

71,070

19,389
48,733

72,635

19,137
48,149

20,190
48,964

20,486
49,506

72,618

20,479
49,790

20,821
50,249

72,609

21,020
51,615

21,083
51,535

21,003
51,606

23,351

28,916
68,731

27,020

27,306

27,519

27,597

27,378

27,252

27,537

7,819
19,201

7,993
19,313

27,630

27,382

New York City banks
Banks outside New York City

8,416
19,103

8,517
19,080

8,437
18,941

8,359
18,893

8,408
19,129

8,514
19,116

8,355
19,027

All other large time deposits4
Total:
19 Large banks
20
New York City banks
21
Banks outside New York City
Issued to IPC's:

35,723
6,948
28,775

36,041
7,021
29,020

36,122
6,958
29,164

36,875
7,025
29,850

36,916
7,032
29,884

37,141
7,058
30,083

37,558
7,058
30,500

37,770
7,059
30,641

37,565
7,053
30,512

21,805

21,908

22,035

22,390

22,498

22,677

22,911

5,602
16,203

5,580
16,328

22,982

5,455
16,580

22,969

5,507
16,883

5,546
16,952

5,596
17,081

5,614
17,297

5,652
17,330

5,625
17,344

13,918

14,133

14,087

14,485

14,418

14,464

1,441
12,692

14,647

14,718

14,596

1,346
12,572

1,503
12,584

1,518
12,967

1,486
12,932

1,462
13,002

1,444
13,203

1,407
13,311

1,428
13,168

16

17
18

22

23
24
25

26
27

Large

Large

banks

banks

New York City banks
Banks outside New York City
Issued to others:
Large

banks

New York City banks
Banks outside New York City
Savings deposits, by ownership category
Individuals and nonprofit organizations:

28

29
30
31

32
33
34

35
36
37

38
39

Large

banks

New York City banks
Banks outside New York City
Partnerships and corporations for profit: 5
Large

banks

New York City banks
Banks outside New York City
Domestic governmental units:
Large

banks

New York City banks
Banks outside New York City
All other: 6
Large

banks

New York City banks
Banks outside New York City

84,661

84,736

84,301

84,140

83,894

83,872

8,741
75,920

8,737
75,999

83,598

8,704
75,436

8,669
75,225

8,665
75,207

83,394

83,616

8,719
75,582

8,670
74,928

8,634
74,760

8,660
74,956

5,115

5,139

5,105

5,055

5,064

5,064

462
4,653

457
4,682

449
4,656

440
4,615

5,005

4,902

448
4,616

451
4,613

4,911

444
4,561

430
4,472

435
4,476

1,095

1,096

1,065

1,058

1,065

1,074

1,086

1,078

1,059

180
915

180
916

166
899

168
890

167
898

159
915

169
917

166
912

161
898

21
9

28
16
12

24
9
15

23
11

24
12

42
16

40

39

42

12

26

18
22

16
23

14
28

12

12

Gross liabilities of banks to their foreign branches
40

41
42

43
44
45

Large

banks

New York City banks
Banks outside New York City
Loans sold outright
to selected institutions by all
large banks7
Commercial and industrials
Real estates
All other 8

8,614

7,995

9,772

7,737

4,762
3,233

8,967

9,893

5,253
3,361

6,220
3,552

9,958

9,965

3,984
3,753

4,440
4,527

5,328
4,565

5,369
4,589

5,841
4,124

6,102
4,013

1,911
291
1,592

1,898
295
1,563

1,846
296
1,540

1,796
305
1,569

1,859
297
1,564

1,819
294
1,641

1,844
301
1,628

1,905
302
1,576

1,807
304
1,665

1
Exclusive of loans and Federal funds transactions with domestic
commercial
banks.
2
All demand deposits except U.S. Govt, and domestic commercial
banks,
less
cash
items in process of collection.
3
Certificates of deposit (CD's) issued in denominations of $100,000 or
more.
4
All other time deposits issued in denominations of $100,000 or more
not included in large negotiable CD's.




10,115

5 Other than commercial banks.
6 Domestic and foreign commercial banks, and official international
organizations.
7
To bank's own foreign branches, nonconsolidated nonbank affiliates of the bank, the bank's holding company (if not a bank), and
nonconsolidated nonbank subsidiaries of the holding company.
8 Data revised beginning July 7, 1977, due to reclassifications at one
large bank.

A24

DomesticNonfinancialStatistics • January 1979

1.31 LARGE WEEKLY REPORTING COMMERCIAL BANKS Commercial and Industrial Loans
Millions of dollars
Outstanding
Industry classification

Net change during—

1978
Nov. 29

Dec. 6

Dec. 13

1978
Dec. 20

Dec. 27^

Q3

1978
Q4*>

Oct.

Nov.

Dec.f

Total loans classified2
114,541

114,799

114,549

115,578

115,773

1,354

4,323

1,863

1,228

1,232

Durable goods manufacturing:
Primary metals
Machinery
Transportation equipment
Other fabricated metal products...
Other durable goods

2,595
5,473
2,627
2,414
3,986

2,624
5,513
2,571
2,451
4,062

2,643
5,415
2,593
2,447
4,050

2,672
5,408
3,110
2,405
4,046

2,662
5,348
3,096
2,471
3,992

-66
-16
-52
69
136

-70
-40
349
-51
-53

-68
61
-159
-78
-79

-69
24
39
-30
20

67
-125
469
57
6

Nondurable goods manufacturing:
Food, liquor, and tobacco
Textiles, apparel, and leather
Petroleum refining
Chemicals and rubber
Other nondurable goods

4,550
3,976
2,552
3,232
2,440

4,642
3,999
2,569
3,275
2,424

4,628
3,930
2,570
3,357
2,405

4,613
3,833
2,660
3,453
2,400

4,681
3,756
2,637
3,465
2,380

-101
240
-116
-101
213

527
-627
116
-3
-100

186
-110
—47
-173
-47

210
-297
78
-63
7

131
-220
85
233
-60

10,622

10,594

10,607

10,629

10,583

172

6

17

28

-39

1,793
9,530
8,939
5,520
1,774
5,545
5,106
14,422

1,859
9,502
8,855
5,494
1,782
5,587
5,040
14,509

1,870
9,443
8.711
5,515
1,748
5,586
5,031
14,484

1,872
9,433
8,557
5,469
1,772
5,741
5,035
14,750

1,952
9,367
8,412
5,494
1,765
5,940
5,098
14,782

-323
232
-80
53
68
89
118
520

208
195
218
32
841
-73
823

61
279
636
34
-20
245
-16
219

-12
79
109
-8
61
201
-49
244

159
-163
-527
-26
-9
395
-8
360

8,458
3,542

8,449
3,591

8,473
3,543

8,392
3,766

8,504
3,808

282
-149

468
696

257
210

165
220

46
266

5,445

5,407

5,500

5,562

5,580

166

861

455

271

135

1 Total
2
3
4
5
6
7
8
9
10
11

12 Mining, including crude petroleum
and natural gas
Trade:
13 Commodity dealers
14
Other wholesale
15
Retail
17
18
19
20

Communication
Other public utilities
Construction
Services

21 All other domestic loans
22 Bankers acceptances
23 Foreign commercial and industrial
MEMO ITEMS:

24 Commercial paper included in total
classified loans *
25 Total commercial and industrial
loans of all large weekly reporting banks

62
140,658

140,655

140,557

141,829

-8

142,103

1,390

1978
Aug. 30

Sept. 27

Oct. 25

-1

45

5,394

2,125

1978
Nov. 29

Dec. 27

Q3

-17
1,824

1,445

1978
Oct.

Q4P

Nov.

Dec.®

"Term" loans classified3
52,618

53,019

53,762

54,861

55,439

1,726

2,420

743

1,099

578

27
28
29
30
31

Durable goods manufacturing:
Primary metals
Machinery
Transportation equipment
Other fabricated metal products...
Other durable goods

1,710
2,669
1,586
990
1,699

1,672
2,650
1,565
1,007
1,713

1,641
2,768
1,506
1,004
1,717

1,631
2,751
1,517
1,040
1,815

1,624
2,771
1,663
1,119
1,902

-34
74
145
13
35

-48
121
98
112
189

-31
118
-59
-3
4

-10
-17
11
36
98

-7
20
146
79
87

32
33
34
35
36

Nondurable goods manufacturing:
Food, liquor, and tobacco
Textiles, apparel, and leather
Petroleum refining
Chemicals and rubber
Other nondurable goods

1,740
1,133
1,882
2,322
1,156

1,727
1,126
1,846
2,301
1,177

1,862
1,096
1,789
2,109
1,192

1,978
1,046
1,843
2,043
1,218

1,918
1,050
1,895
2,181
1,183

56
4
-101
-111
86

191
-76
49
-120
6

135
-30
-57
-192
15

116
-50
54
-66
26

-60
4
52
138
-35

7,757

7,862

7,852

7,930

7,937

102

75

-10

78

7

248
2,276
2,827
3,732
1,057
3,860
2,245
6,606
2,616

250
2,360
2,791
3,753
1,076
3,847
2,224
6,797
2,713

268
2,329
3,065
3,718
1,065
3,960
2,264
6,936
2,798

305
2,372
3,225
3,746
1,131
4,064
2,295
7,113
2,857

314
2,342
3,204
3,790
1,158
4,221
2,373
7,270
2,866

22
185
-43
15
67
318
107
307
393

64
-18
413
37
82
374
149
473
153

18
-31
274
-35
— 11
113
40
139
85

37
43
160
28
66
104
31
177
59

9
-30
-21
44
27
157
78
157
9

2,507

2,562

2,823

2,941

2,658

86

96

261

118

-283

26 Total

37 Mining, including crude petroleum
and natural gas
Trade:
38
Commodity dealers
39
Other wholesale
40
Retail
41 Transportation
42 Communication
43 Other public utilities
44 Construction
45 Services
47 Foreign commercial and industrial

1
2
3

Reported for the last Wednesday of each month.
Includes "term" loans, shown below.
Outstanding loans with an original maturity of more than 1 year and




all outstanding loans granted under a formal agreement—revolving credit
or standby—on which the original maturity of the commitment was in
excess of 1 year.

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
1977

Type of holder

1 All

holders,

individuals,

partnerships,

and

corporations
2 Financial business
4 Consumer
6 Other

1974
Dec.

1975
Dec.

1976
Dec.

225.0

236.9

19.0
118.8
73.3
2.3
11.7

20.1
125.1
78.0
2.4
11.3

1978

Mar.

June

Sept.

Dec.

Mar.

June

Sept.

250.1

242.3

253.8

252.7

274.4

262.5

271.2

278.8

22.3
130.2
82.6
2.7
12.4

21.6
125.1
81.6
2.4
11.6

25.9
129.2
84.1
2.5
12.2

23.7
128.5
86.2
2.5
11.8

25.0
142.9
91.0
2.5
12.9

24.5
131.5
91.8
2.4
12.3

25.7
137.7
92.9
2.4
12.4

25.9
142.5
95.0
2.5
13.1

At weekly reporting banks
1978
1975
Dec.

7 All

holders, individuals,
corporations

partnerships,

8 Financial business
9 Nonfinancial business
10 Consumer
12 Other

and

1976
Dec.

1977
Dec.
May

June

July

Aug.

Sept.

Oct.

Nov.

124.4

128.5

139.1

134.3

136.9

139.9

137.7

139.7

141.3

142.7

15.6
69.9
29.9
2.3
6.6

17.5
69.7
31.7
2.6
7.1

18.5
76.3
34.6
2.4
7.4

18.1
70.7
36.0
2.4
7.1

19.0
71.9
36."6
2.3
7.1

19.4
73.7
37.1
2.3
7.3

19.4
72.0
36.8
2.4
7.1

18.9
74.1
37.1
2.4
7.3

19.1
75.0
37.5
2.5
7.2

19.3
75.7
37.7
2.5
7.5

NOTE.—Figures include cash items in process of collection. Estimates of
gross deposits are based on reports supplied by a sample of commercial

banks. Types of depositors in each category are described in the June 1971
BULLETIN, p. 466.

1.33 COMMERCIAL PAPER AND BANKERS ACCEPTANCES OUTSTANDING
Millions of dollars, end of period
1978
Instrument

1975
Dec.

1976
Dec.

1977
Dec.
May

June

July

Aug.

Sept.

Oct.

Nov.

Commercial paper (seasonally adjusted)
1 AH issuers

2
3
4
5

Financial companies: 1 2
Dealer-placed paper:
Total
Bank-related
Directly-placed paper: 3
Total
Bank-related

6 Nonfinancial companies 4

48,459

53,025

65,209

71,213

74,536

74,900

73,960

•76,988

77,152

80,504

6,202
1,762

7,250
1,900

8,871
2,132

10,314
2,217

10,327
2,442

10,617
2,633

10,868
2,935

'11,470
2,622

10,921
2,868

11,455
3,231

31,374
6,892

32,500
5,959

40,496
7,102

44,664
9,258

47,315
9,585

46,594
10,030

45,510
9,634

47,791
10,383

48,030
10,925

50,010
11,478

10,883

13,275

15,842

16,235

16,894

17,689

17,582

'17,727

18,201

19,039

27,952

30,579

32,145

Dollar acceptances (not seasonally adjusted)
7 Total

18,727

22,523

25,654

10,442

10,434

26,714

28,289

27,579

28,319

Held by:
8

9
10

Accepting

banks

7,333

7,286

7,502

7,244

7,048

7,647

8,379

9,268

6,365
921

6,520
983

6,345
899

6,131
917

6,461
1,186

7,012
1,366

8,025
1,243

5,899
1,435

8,769
1,673

8,915
1,519

11
12

Own bills
Bills bought
Federal Reserve Banks:
Own account
Foreign correspondents

1,126
293

991
375

954
362

679

625

568

633

556

557

585

13

Others

9,975

10,715

13,904

18,749

20,160

19,766

20,638

19,748

21,644

22,292

3,726
4,001
11,000

4,992
4,818
12,713

6,532
5,895
13,227

7,027
6,494
13,193

7,578
6,906
13,805

7,415
6,565
13,599

7,885
6,558
13,876

7,957
6,350
13,644

8,575
6,665
15,339

8,675
7,224
16,245

14
15
16

Based on:
Imports into United States
Exports from United States
All other

1 Institutions engaged primarily in activities such as, but not limited to,
commercial, savings, and mortgage banking; sales, personal, and mortgage
financing; factoring, finance leasing, and other business lending; insurance
underwriting; and other investment activities.
2 Includes all financial company paper sold by dealers in the open
market.




3
As reported by financial companies that place their paper directly
with investors.
4
Includes public utilities and firms engaged primarily in activities such
as communications, construction, manufacturing, mining, wholesale and
retail trade, transportation, and services.

A26

DomesticNonfinancialStatistics • January 1979

1.34 PRIME RATE CHARGED BY BANKS on Short-term Business Loans
Per cent per annum
Month
Effective date

Rate

Effective date
1978—Sept. 15,

1978—Jan. 10.

28,

May

91/2

9VA

5,
26,

8%
81/2

Oct.

13
27,

10
101/4

June 16.
30.

8%
9

Nov.

Aug. 31.

9%

1
6
17.
24

lOi/i
103/4
11
lH/2

Dec. 26

11%

1977—Jan
Feb
Mar
Apr
May
June
July
Aug
Sept
Oct
Nov
Dec

1.35 TERMS OF LENDING AT COMMERCIAL BANKS

Month

Average
rate

Rate

6.25
6.25
6.25
6.25
6.41
6.75
6.75
6.83
7.13
7.52
7.75
7.75

Average
rate

1978—Jan
Feb

7.93
8.00
8.00
8.00
8.27
8.63
9.00
9.01
9.41
9.94
10.94
11.55

July
Oct
Dec

Survey of Loans Made, August 7-12, 1978
Size of loan (in thousands of dollars)

All
sizes
50-99

25-49

1-24

100-499

500-999

1,000
and over

Short-term commercial and industrial loans
7,198,593
1,049,321
559,214
638,138
1,899,754
532,767
Amount of loans (thousands of dollars)
187,673
147,855
16,858
10,683
10,445
863
Number of loans
3.0
2.8
3.4
2.4
3.0
3.3
Weighted-average maturity (months)
9.97
10.45
10.19
10.30
10.19
9.93
Weighted-average interest rate (per cent per annum)..
9.31-10.47 9.25-11.65 9 . 3 4 - 1 0 . 5 0 9.73-10.75 9 . 3 8 - 1 0 . 6 4 9.31-10.43
Interquartile range 1
Percentage of amount of loans:
48.3
32.0
36.6
46.5
43.2
57.4
6
With floating rate
38.1
15.2
21.0
27.5
31.2
58.5
7
Made under commitment

1
2
3
4
5

2,519,400
970
3.1
9.47
9.00-9.88
60.1
54.9

Long-term commercial and industrial loans
8
9
10
11
12

Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
Weighted-average interest
rate (per cent per annum)..
Interquartile range 1
Percentage of amount of loans:
13
With floating rate
14
Made under commitment

1,417,990
22,251
45.2
10.20
9.38-11.00

293,717
19,735
33.7
10.66
9.89-11.57

65.5
51.3

30.1
25.0

355,547
99,274
669,452
2,218
150
148
47.2
57.7
47.4
10.35
9.83
9.96
9.38-11.02 9.25-10.50 9.00-10.48
62.3
35.7

55.1
50.6

84.3
71.2

Construction and land development loans
15
16
17
18
19
20
21
22
23
24
25

Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
Weighted-average interest
rate (per cent per annum)..
Interquartile range 1
Percentage of amount of loans:
With floating rate
Secured by real estate
Made under commitment
Type of construction: 1 - t o 4-family
Multifamily
Nonresidential

1,177,413
228,314
144,262
155,635
381,591
30,901
22,364
4,546
2,278
1,490
8.4
10.7
9.6
3.8
7.2
10.43
10.27
10.66
11.05
10.33
9 . 9 5 - 1 1 . 0 2 9.27-10.87 10.00-11.00 10.00-12.73 10.03-10.70
49.3
92.9
55.2
42.1
8.5
49.4
All
sizes

12.3
85.4
49.7
77.2
1.2
21.6

13.0
97.1
32.7
71.3
10.0
18.8

25-49

10-24

1-9

18.3
94.5
68.2
64.9
1.7
33.4

267,611
223
9.6
10.23
9.27-11.30

80.2
97.1
43.5
20.2
7.8
71.9

50-99

74.3
90.3
81.3
14.5
18.8
66.8

100-249

250
and over

Loans to farmers
26
27
28
29
30
31
32
33
34
35

Amount of loans (thousands of dollars)
Number of loans
Weighted-average maturity (months)
Weighted-average interest rate (per cent per annum)..
Interquartile range 1
By purpose of loan:
Feeder livestock
Other livestock
Other current operating expenses
Farm machinery and equipment
Other

824,790
63,389
6.6
9.62
9.13-10.21

159,057
45,994
7.5
9.33
8.77-9.73

9.49
9.47
9.66
9.63
9.87

9.13
9.36
9.27
9.52
9.61

1 Interest rate range that covers the middle 50 per cent of the total
dollar amount of loans made.
2
Fewer than three sample loans.




157,111
150,908
10,109
4,942
10.2
6.6
9.33
9.46
8.77-9.73 9.00-10.00
9.11
9.44
9.44
9.53
9.22

9.37
10.03
9.26
9.86
9.67

82,007
183,409
92,298
689
1,338
317
3.9
6.1
5.8
9.92
9.51
10.15
9.20-9.84 9.25-10.38 9.54-10.97
9.48
8.86
9.81
9.41
9.77

9.60
10.19
9.96
2

()

10.39

9.91
9.76
10.41

(2)

10.28

NOTE.—For more detail, see the Board's 416 (G.14) statistical release,

Securities Markets
1.36

INTEREST RATES

All

Money and Capital Markets

Averages, per cent per annum
1978
Instrument

1976

1977

1978, week ending—

1978
Sept.

Oct.

Nov.

Dec.

Dec. 2

Dec. 9 Dec. 16 Dec. 23 Dec. 30

Money market rates
1 Federal funds 1

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 paper 2 - 3
2
90- to 119-day
3 4- to 6 -month

5.24
5.35

5.54
5.60

7.94
7.99

8.39
8.44

8.98
9.03

10.14
10.23

10.37
10.43

10.20
10.28

10.25
10.32

10.29
10.36

10.45
10.50

10.55
10.61

4 Finance company 3paper,
directly placed,
3- to 6-month - 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-day 3 - 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 of6 deposit
6
3-month, secondary market
3-month, primary market 7
7

5.26
5.15

5.58
5.52

8.20
8.01

8.61
8.42

9.14
9. 17

10.72
10.12

10.72
10.41

10.66
10.25

10.64
10.37

10.53
10.36

10.68
10.51

10.96
10.56

8 Euro-dollar deposits, 3-month 8

5.57

6.05

8.74

9.12

10.12

11.51

11.62

11.66

11.56

11.33

11.60

11.95

4.98
5.26
5.52

5.27
5.53
5.71

7.19
7.58
7.74

7.85
7.99
8.01

7.99
8.55
8.45

8.64
9.24
9.20

9.08
9.36
9.44

8.98
9.27
9.29

8.93
9.24
9.32

8.93
9.24
9.28

9.28
9.58
9.61

9.25
9.46
9.65

4.989
5.266

5.265
5.510

7.221
7.572

7.836
7.948

8.132
8.493

8.787
9.204

9.122
9.397

9.166
9.330

8.984
9.220

8.929
9.263

9.237
9.524

9.336
9.580

9
10
11
12
13

U.S. Government securities
Bills: 3.9
Market yields:
3-month
6-month
1-year
Rates on new issue: 1 0
3-month
6-month

Capital market rates

14
15
16
17
18
19
20
21
22
23

24
25
26

27
28
29
30
31
32
33

Government notes and bonds
U.S. Treasury
Constant maturities: 11
1-year
2-year
3-year
5-year
7-year
10-year
20-year
30-year
Notes and bonds maturing in — 1 2
3 to 5 years
Over 10 years (long-term)
State and local: 13
Moody's series:
Aaa
Baa
Bond

Buyer

series14

Corporate bonds 15
Seasoned issues
All industries
By rating groups:
Aaa
Aa
A
Baa
Aaa utility bonds: 1 6
New issue
Recently offered issues

Dividend/price ratio
34
Preferred stocks
35
Common stocks

6.77
7.18
7.42
7.61
7.86

6.09
6.45
6.69
6.99
7.23
7.42
7.67

8..34
8,.34
8..29
8..32
8..36
8,.41
8 .48
8..49

8.64
8.57
8.41
8.43
8.42
8.42
8.47
8.47

9. 14
8. 85
8. 62
8. 61
8. 64
8. 64
8. 69
8. 67

10.01
9.42
9.04
8.84
8.80
8.81
8.75
8.75

10.30
9.72
9.33
9.08
9.03
9.01
8.90
8.88

10.11
9. 56
9. 16
8. 92
8. 88
8. 85
8. 78
8. 78

10. 14
9..50
9..12
8..89
8..86
8..86
8..79
8..80

10.12
9.54
9.19
8.97
8.95
8.95
8.85
8.86

10.49
9.93
9.52
9.25
9.19
9.14
9.00
8.98

10.54
9.98
9.59
9.32
9.22
9.14
8.99
8.95

6.94
6.78

6.85
7.06

8,.30
7..89

8.38
7.82

8. 61
8. 07

8.97
8.16

9.23
8.36

9. 01
8. 21

9.,02
8..27

9.12
8.32

9.41
8.44

9.48
8.43

5.66
7.49
6.64

5.20
6.12
5.68

5..52
6.27
6.03

5.53
6.63
6.09

5. 53
6. 18
6. 13

5.59
6.65
6.19

5.91
6.76
6.51

5. 55
6. 80
6.29

5.,70
6..50
6.29

5.85
6.55
6.45

6.05
7.00
6.67

6.05
7.00
6.61

9.01

8.43

9..07

9.08

9. 20

9.40

9.49

9. 39

9.40

9.44

9.55

9.62

8.43
8.75
9.09
9.75

8.02
8.24
8.49
8.97

8..73
8..92
9..12
9.45

8.78
8.96
9.11
9.47

8. 89
9. 07
9. 26
9. 59

9.03
9.24
9.48
9.83

9.16
9.33
9.53
9.94

9. 04
9. 22
9.45
9. 85

9.,06
9. 23
9.47
9. 85

9.12
9.25
9.49
9.89

9.24
9.40
9.56
9.99

9.27
9.49
9.64
10.08

8.48
8.49

8.19
8.19

R
8.97

8.86
8.86

9. 17
9. 13

9 27
9.27

9.28
9.41

9. 27

9. 28

9. 28
9. 31

9.29
9.35

9.54

9.51

7.97
3.77

7.60
4.56

8.,25
5.,28

8.24
4.97

8. 29
5. 11

8.43
5.45

8.84
5.39

8.41
5. 49

8. 69
5. 28

8.79
5.39

8.94
5.50

8.92
5.39

5.88

1
Weekly figures are 7-day averages of daily effective rates for the week
ending Wednesday; the daily effective rate is an average of the rates on
a given day weighted by the volume of transactions at these rates.
2
Beginning Nov. 1977, unweighted average of offering rates quoted
by five dealers. Previously, most representative rate quoted by those
dealers.
3
Yields are quoted on a bank-discount basis.
4
Averages of the most representative daily offering rates published by
finance companies for varying maturities in this range.
5
Average of the midpoint of the range of daily dealer closing rates
offered for domestic issues.
6
Weekly figures (week ending Wednesday) are 7-day averages of the
daily midpoints as determined from the range of offering rates; monthly
figures are averages of total days in the month. Beginning Apr. 5, 1978,
weekly
figures are simple averages of offering rates.
7
Posted rates, which are the annual interest rates most often quoted
on new offerings of negotiable CD's in denominations of $100,000 or
more by large New York City banks. Rates prior to 1976 not available.
Weekly figures are for Wednesday dates.
8
Averages of daily quotations for the week ending Wednesday.




r
r

9 Except for new bill issues, yields are computed from daily closing
bid prices.
!0 Rates are recorded in the week in which bills are issued.
11
Yields on the more actively traded issues adjusted to constant
maturities
by the U.S. Treasury, based on daily closing bid prices.
12
Unweighted averages for all outstanding notes and bonds in maturity
ranges shown, based on daily closing bid prices. "Long-term" includes
all bonds neither due nor callable in less than 10 years, including a number of very low yielding "flower" bonds.
13
General obligations only, based on figures for Thursday, from
Moody's Investors Service.
14
Twenty
issues of mixed quality.
15
Averages of daily figures from Moody's Investors Service.
16
Compilation of the Board of Governors of the Federal Reserve
System.
Issues included are long-term (20 years or more). New-issue yields
are based on quotations on date of offering; those on recently offered
issues (included only for first 4 weeks after termination of underwriter
price restrictions), on Friday close-of-business quotations.

A28

DomesticNonfinancialStatistics • January 1979

1.37 STOCK MARKET Selected Statistics
1978
Indicator

1975

1976

1977

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

52.74
57.50
41.80
37.88
54.95

53.69
58.72
42.49
38.09
55.73

Prices and trading (averages of daily figures)
Common stock prices
54.61
59.35
44.74
39.28
57.97

58.53
64.07
49.45
40.20
63.28

58.58
64.23
50.19
39.82
63.22

56.40
61.60
46.70
39.44
60.42

97.66

97.19

103.92

103.86

100.58

94.71

96.10

147.64

149.87

162.52

170.95

160.14

144.17

149.94

27,074
3,496

37,603
5,526

33,612
5,740

31,020
4,544

24,505
3,304

24,622
3,430

45.73
51.88
30.73
31.45
46.62

54.45
60.44
39.57
36.97
52.94

6 Standard & Poor's Corporation (1941-43 = 10) i . .

85.17

102.01

98.18

7 American Stock Exchange (Aug. 31,1973 = 100).

83.15

101.63

116.18

18,568
2,150

21,189
2,565

20,936
2,514

30,514
4,220

8
9

Volume of trading (thousands of shares) 2
New York Stock Exchange
American Stock Exchange

53.67
57.84
41.07
40.91
55.23

54.83
59.63
44.19
39.41
58.31

1 New York Stock Exchange (Dec. 31,1965 = 50).
2
Industrial
3
Transportation
4
Utility
5
Finance

Customer financing (end-of-period balances, in millions of dollars)
10 Regulated margin
credit at brokers/dealers
11
Margin stock 4
12
Convertible bonds
13
Subscription issues

5,540
5,390
147
3

8,166
7,960
204
2

9,993
9,740
250
3

11,332
11,090
242

11,438
11,190
247
1

11,984
11,740
243

12,626
12,400
225
1

MEMO: Free credit balances at brokers®
Margin-account
Cash-account

475
1,525

585
1,855

640
2,060

700
2,300

710
2,295

795
2,555

825
2,655

14
15

12,307
12,090
216
1

11,209
11,000
209

r
885
2,465

790
2,300

r

Margin-account debt at brokers (percentage distribution, end of period)
16 Total
17
18
19
20
21
22

By equity class (in per cent):
Under 40
40-49
50-59
60-69
70-79
80 or more

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

100.0

24.0
28.8
22.3
11.6
6.9
5.3

12.0
23.0
35.0
15.0
8.7
6.0

18.0
36.0
23.0
11.0
6.0
5.0

16.0
34.0
26.0
12.0
7.0
5.0

13.0
34.0
25.0
14.0
8.0
6.0

12.0
34.0
23.0
16.0
9.0
6.0

15.0
36.0
23.0
13.0
7.0
6.0

47.0
20.0
15.0
8.0
5.0
5.0

32.0
27.0
20.0
10.0
6.0
5.0

Special miscellaneous-account balances at brokers (end of period)
23 Total balances (millions of dollars) 8
Distribution by equity status (per cent)
24
Net credit status
Debit status, equity of—
25
60 per cent or more
26
Less than 60 per cent

7,290

8,776

9,910

43.8

41.3

43.4

40.8
15.4

47.8
10.9

44.9
11.7

1
Effective July 1976, includes a new financial group, banks and insurance companies. With this change the index includes 400 industrial
stocks (formerly 425), 20 transportation (formerly 15 rail), 40 public
utility
(formerly 60), and 40 financial.
2
Based on trading for a 5Vi-hour day.
3 Margin credit includes all credit extended to purchase or carry
stocks or related equity instruments and secured at least in part by stock.
Credit extended is end-of-month data for member firms of the New York
Stock Exchange.
In addition to assigning a current loan value to margin stock generally,
Regulations T and U permit special loan values for convertible bonds
and stock acquired through exercise of subscription rights.
4
A distribution of this total by equity class is shown on lines 23-28.




5 Nonmargin stocks are those not listed on a national securities exchange and not included on the Federal Reserve System's list of over-thecounter margin stocks. At brokers, such stocks have no loan value.
6
Free credit balances are in accounts with no unfulfilled commitments
to the brokers and are subject to withdrawal by customers on demand.
7 Each customer's equity in his collateral (market value of collateral
less net debit balance) is expressed as a percentage of current collateral
values.
8 Balances that may be used by customers as the margin deposit required for additional purchases. Balances may arise as transfers based
on loan values of other collateral in the customer's margin account or
deposits of cash (usually sales proceeds) occur.
NOTE.—For table on "Margin Requirements" see p. A-10, Table 1.161.

Thrift Institutions

A29

1.38 SAVINGS INSTITUTIONS Selected Assets and Liabilities
Millions of dollars, end of period
1978
1975

1976

1977
Mar.

Account

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Savings and loan associations 9
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
3 Cash and investment

278,590 323,005 381,163 392,428 397,284 402,305 407,965 411,956 416,677 420,971 425,236 429,316

4 Other
5 Liabilities and net worth

30,853
28,790

35,724
33,178

39,150
38,928

41,823
41,030

41,853
41,810

42,444
42,303

41,505
42,106

43,627
42,718

44,188
43,433

43,987
44,019

45,577
44,539

45,761
45,343

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
38,595
40,862
39,873
28,632 29,456 30,290
10,417
10,572
9,963
10,483
11,222 11,165
10,676 12,832 14,648

20,634

19,083

27,840

29,323

31,904

32,759

34,270

35,730

37,219

8
FHLBB
9
Other
10 Loans in process
11 Other

17,524
3,110
5,128
6,949

15,708
3,375
6,840
8,074

19,945
7,895
9,911
9,506

21,030
8,293
10,414
10,518

22,692
9,212
10,937
12,186

23,323
9,436
11,386
14,239

24,875
9,395
11,632
10,046

26,151
9,579
11,540
11,972

27,363
9,856
11,422
13,906

12 Net worth 2

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 outstanding 3 ..

10,673

14,826

19,875

22,308

23,398

23,939

22,927

22,393

22,047

21,648

21,503

26,017

7 Borrowed

money

Mutual savings banks 1 0
14 Assets.
15
16
17
18
19
20
21

Loans:
Mortgage
Other
Securities:
U.S. Government
State and local go veri
Corporate and other 4
Cash
Other assets

121,056 134,812 147,287 150,962 151,383 152,202 153,175 154,315 155,210 156,110 156,843
77,221
4,023

81,630
5,183

88,195
6,210

89,800
7,782

90,346
7,422

90,915
7,907

91,555
7,771

92,230
8,207

92,866
8,379

93,403
8,418

93,903
8,272

4,740
1,545
27,992
2,330
3,205

5,840
2,417
33,793
2,355
3,593

5,895
2,828
37,918
2,401
3,839

5,677
2,850
38,964
1,990
3,899

5,670
2,915
39,146
1,940
3,945

5,491
2,994
39,225
1,798
3,873

5,304
3,008
39,427
2,163
3,946

5,269
3,025
39,639
2,029
3,915

5,210
3,098
39,592
2,080
3,985

5,172
3,180
39,639
2,293
4,006

5,105
3,190
39,651
2,735
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

2 3 Deposits

109,873

122,877

134,017

136,997

136,931

137,307

138,709

139,128

139,308

140,816

141,026

109,291 121,961 132,744 135,558 135,349 135,785 137,089 137,430 137,690 139,068 139,422
24
Regular: 5
76,116 75,578 75,423 74,124
69,653 74,535 78,005 78,783 78,170 78,273 77,321
25
Ordinary savings..
39,639 47,426 54,739 56,775 57,179 57,512 59,768 61,313 62,112 63,645 65,298
26
Time and other...
1,582
1,439
1,521
1,272
582
916
1,619
1,620
1,698
1,604
1,747
27
Other
4,152
3,292
2,884
3,735
4,481
2,755
3,969
4,636
5,040
5,246
4,570
28 Other liabilities
10,414 10,497 10,551
9,052
10,230 10,301
9,978
10,654 10,725
8,428
10,777
29 General reserve accounts
30 MEMO: Mortgage loan commitments outstanding®..
4,342
1,803
2,439
4,066
4,185
4,606
4,872
4,958
4,789
4,843
4,561
Life insurance companies 11
289,304 321,552 351,722 359,110 363,269 366,938 369,879 374,415 378,124 381,050 382,446

31 Assets
Securities:
32

33
34
35
36

37
38
39
40
41
42

Government

United States 7
State and
local
Foreign 8

Business

Bonds
Stocks
Mortgages
Real estate
Policy loans
Other assets

13,758

4,736
4,508
4,514
135,317

17,942

5,368
5,594
6,980
157,246

19,553

5,315
6,051
8,187
175,654

19,573
5,229

6,041
8,303
181,441

19,330

5,087
5,923
8,320
184,917

19,489

5,206
5,915
8,368
187,126

19,401

4,984
5,943
8,474
188,500

19,447

5,006
5,925
8,516
192,112

107,256 122,984 141,891 148,849 150,419 152,267 153,812 156,207
28,061 34,262 33,763 32,592 34,498 34,859 34,688 35,905
89,167
9,621
24,467
16,971

91,552
10,476
25,834
18,502

96,848
11,060
27,556
21,051

98,022
11,213
28,024
20,837

98,585
11,269
28,246
20,922

19,563

5,155
5,884
8,524
194,620

19,638

5,156
6,001
8,481
196,152

19,757

5,183
6,035
8,539
195,883

157,888 159,972 161,347
36,732 36,180 34,536

99,190 100,040 100,596 101,602 102,365 103,161
11,540 11,562 11,538
11,537
11,693
11,583
28,431 28,649 28,843 29,067 29,290 29,521
21,165 21,749 21,855 21,734 22,022 22,431
Credit unions

43 Total assets/liabilities and
capital
Federal
State

38,037
20,209
17,828

45,225
24,396
20,829

4 6 Loans

28,169

34,384

42,055

43,379

44,133

14,869
13,300

18,311
16,073

22,717
19,338

23,555
19,824

23,919
20,214

4 9 Savings

33,013

39,173

46,832

49,706

50
51

17,530
15,483

21,130
18,043

25,849
20,983

27,514
22,192

44
45

47
48

outstanding

Federal
State
Federal (shares)
State (shares and deposits).

For notes see bottom of page A30.




54,084
29,574
24,510

56,703
31,274
25,429

56,827
31,255
25,572

58,018
31,925
26,093

59,381
32,793
26,588

59,152
32,679
26,473

60,141
33,315
26,826

61,277
34,058
27,219

60,909
33,718
27,191

61,465
34,093
27,372

45,506

47,118

47,620

49,103

50,121

24,732

25,762
21,356

50,549

51,264

20,11A

25,970
21,650

26,840
22,263

27,510
22,611

27,697
22,852

28,176
23,088

49,931

50,789

52,076

51,551

51,772

27,592
22,339

52,867

28,128
22,661

28,903
23,173

52,468

52,600

28,627
22,924

28,779
22,993

29,429
23,438

29,086
23,382

29,163
23,437

A30

DomesticNonfinancialStatistics • January 1979

1.39 FEDERAL FISCAL AND FINANCING OPERATIONS
Millions of dollars
Calendar year
Type of account or operation

Transition
quarter
(JulySept.
1976)

Fiscal
year
1977

Fiscal
year
1978

1977
HI

1
2
3
4
5

6
7

U.S. Budget
Receipts 1
Outlays i
Surplus,

81,772
94,742

or deficit

Trust funds
Federal funds

( —)
2

Off-budget entities surplus, or
deficit ( - )
Federal Financing Bank o u t l a y s . . .
Other 3

357,762
402,803

401,997
450,758

190,278
200,350

1978

1978

HI

H2

175,820
216,781

Sept.

42,591
38,935

210,650
222,518

-12,970

-45,041

-48,761

-10,072

-40,961

-11,870

-1,952
-11,018

7.833
-52,874

12,693
-61,454

7,332
-17,405

4,293
-45,254

4,334
-16,204

-2,575
793

-8,415
-269

-10,660
354

-2,075
-2,086

-6,663
428

-5,105
-790

Oct.

3,655
5,922

28,745
42,691

Nov.

33,227
39,134

-13,946

-5,907

-2,267

1,626
-15,572

1,293
-7,200

-753
-29

-975
171

-296
1,700

U.S. Budget plus off-budget, including Federal Financing Bank
8
9
10
11

Surplus,

or deficit

( —)

Financed by:
Borrowing from the public
Cash and monetary assets (decrease, or increase (—))
Other 4

-14,752

-53,725

-59,067

-14,233

-47,196

-17,765

-2,873

-14,750

-4,503

18,027

53,516

59,106

16,480

40,284

23,374

2,821

6,484

5,236

-2,899
-373

-2,238
2,440

-3,023
2,984

-4,666
2,420

4,317
2,597

-5,098
-511

-9,731
9,783

7,082
1,184

3,485
-4,218

17,418
13,299
4,119

19,104
15,740
3,364

22,444
16,647
5,797

16,255
15,183
1.072

12,274
7,114
5,160

17,526
11,614
5,912

22,444
16,647
5,797

15,545
15,467
78

16,291
4,196
12,095

MEMO ITEMS :

12 Treasury operating balance (level, end
of period)
13
Federal Reserve Banks
14
Tax and loan accounts

1 Effective June 1978, earned income credit payments in excess of
an individual's tax liability, formerly treated as income tax refunds, are
classified as outlays retroactive to January 1976.
2
Half years calculated as a residual of total surplus/deficit and trust
fund surplus/deficit.
3 Includes Pension Benefit Guaranty Corp.; Postal Service Fund; Rural
Electrification and Telephone Revolving Fund, Rural Telephone Bank;
and Housing for the Elderly or Handicapped Fund until October 1977.

4
Includes public debt accrued interest payable to the public; deposit
funds; miscellaneous liability (including checks outstanding) and asset
accounts; seignorage; increment on gold; net gain/loss for U.S. currency
valuation adjustment; net gain/loss for I M F valuation adjustment.

SOURCE.—"Monthly Treasury Statement of Receipts and Outlays of
t h e U . S . G o v e r n m e n t , " Treasury
1978.

Bulletin,

and U.S.

Budget,

Fiscal

Year

NOTES TO TABLE 1.38
1
Holdings of stock of the Federal home loan banks are included in
"other
assets."
2
Includes net undistributed income, which is accrued by most, but not
all, associations.
3 Excludes figures for loans in process, which are shown as a liability.
4
Includes securities of foreign governments and international organizations and nonguaranteed issues of U.S. Government agencies.
5 Excludes checking, club, and school accounts.
6 Commitments outstanding (including loans in process) of banks in
New York State as reported to the Savings Banks Association of the
State of New York.
7
Direct and guaranteed obligations. Excludes Federal agency issues
not guaranteed, which are shown in this table under "business" securities.
8
Issues of foreign governments and their subdivisions and bonds of the
International Bank for Reconstruction and Development.
9 Data reflect benchmark revisions back to 1977.
10
Data for June, July, and August 1978 have been revised.
11 Data for 1977 and the first 6 months of 1978 have been revised by
the American Council of Life Insurance.




N O T E . — S a v i n g s and

loan

associations:

Estimates by the F H L B B for

all associations in the United States. Data are based on monthly reports
of Federally insured associations and annual reports of other associations.
Even when revised, data for current and preceding year are subject to
further revision.
Mutual savings banks: Estimates of National Association of Mutual
Savings Banks for all savings banks in the United States. Data are reported on a gross-of-valuation-reserves basis.
Life insurance companies: Estimates of the American Council of Life
Insurance for all life insurance companies in the United States. Annual
figures are annual-statement asset values, with bonds carried on an
amortized basis and stocks at year-end market value. Adjustments for
interest due and accrued and for differences between market and book
values are not made on each item separately but are included, in total, in
"other assets."
Credit unions: Estimates by the National Credit Union Administration
for a group of Federal and State-chartered credit unions that account for
about 30 per cent of credit union assets. Figures are preliminary and
revised annually to incorporate recent benchmark data.

Federal Finance

A31

1.40 U.S. BUDGET RECEIPTS AND OUTLAYS
Millions of dollars
Calendar year
Transition
quarter
(JulySept.
1976)

Source or type

year
1977

Fiscal
year
1978
HI

1978

1978

1977
H2

HI

Sept.

Oct.

Nov.

Receipts
1 All sources1
2 Individual

3
4
5
6
7

8
9
10

11
12
13
14
15
16
17
18

income

taxes,

net

Withheld
Presidential Election Campaign
Fund
Nonwithheld
Refunds i
Corporation

income

357,762

401,997

190,278

175,820

210,650

42,591

28,745

33,227

157,626

180,988

78,816

82,911

90,336

20,883

15,922

16,609

32,949

144,820

165,215

73,303

75,480

82,784

14,843

15,032

16,268

1
6,809
958

37
42,062
29,293

39
47,804
32,070

37
32,959
27,482

1
9,397
1,967

36
37,584
30,068

6,354
314

1,104
214

533
192

9,808
1,348

60,057
5,164

65,380
5,428

37,133
2,324

25,121
2,819

38,496
2,782

10,153
400

2,436
752

1,541
493

taxes:

Gross receipts
Refunds
Social insurance
tions, net

81,772
38,800

taxes and

contribu-

Excise taxes
Customs deposits
Estate and gift taxes
Miscellaneous receipts

58,099

52,347

66,191

8,515

7,805

21,534

88,196

99,626

45,242

44,384

51,668

7,485

6,595

9,762

269
2,698
1,259

4,014
11,312
5,162

4,267
13,850
5,668

3,687
6,575
2,595

316
4,936
2,711

3,892
7,800
2,831

369
162
499

722
488

1,662
499

4,473
1,212
1,455
1,612

17,548
5,150
7,327
6,536

18,376
6,573
5,285
7,413

8,432
2,519
4,332
3,269

9,284
2,8^8
2,837
3,292

8,835
3,320
2,587
3,667

1,637
610
445
747

1,635
621
477
602

1,712
646
460
829

25,760

Payroll employment
taxes and
contributions 2
Self-employment taxes and
contributions 3
Unemployment insurance
Other net receipts 4

5

108,683

123,410

11,923

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
21
22

22,307
2,180

97,501
4,831

105,192
6,083

48,721
2,522

50,873
2,896

52,979
2,904

9,006
387

9,197
324

9,239
-47

1,161
794
2,532
584

4,677
4,172
10,000
5,526

4,721
6,045
11,022
7,618

2,108

2,318

2,628

5,477

2,395
2,487
4,959
2,353

403
933
1,391
283

367
821
878
949

412
792
889
1,372

1,391
3,306

-31
14,636

3,340
15,461

—946
7,723

467
1,572

2,124
1,695

41
1,414

23
24
25

National defense
International affairs
General science, space, and
technology
Energy
Natural resources and environment.
Agriculture

26
27
28

Commerce and housing credit
Transportation
Community and regional
development
29 Education, training, employment,
and social services
30 Health
31 Income security 1
32
33
34
35
36
37

Veterans benefits and services
Administration of justice
General government
General-purpose fiscal assistance....
Interest 6
Undistributed offsetting receipts 6 - 7

1,340

6,283

11,255

3,149

4,924

5,928

1,439

929

910

5,162
8,720
32,795

20,985
38,785
137,905

25,889
44,529
145,640

9,775
18,654
70,785

10,800
19,422
71,081

12,792
21,391
75,201

2,263
3,595
12,756

2,144
4,037
11,815

2,244
3,957
12,358

3,962
859
878
2,092
7,246
-2,567

18,038
3.600
3,357
9,499
38,092
-15,053

18,987
3,786
3,544
9,377
44,040
-15,772

9,382
1,783
1,587
4,333
18,927
-6,803

9,864
1,723
1,749
4,926
19,962
-8,506

9,603
1,946
1,803
4,665
22,280
-7,945

1,442
324
335
127
3,306
-1,089

1,647
328
785
2,019
3,030
-397

1,667
392
196
160
3,850
-713

1 Effective June 1978, earned income credit payments in excess of an
individual's tax liability, formerly treated as income tax refunds, are
classified as outlays retroactive to January 1976.
2
Old-age, disability and hospital insurance, and Railroad Retirement
accounts.
3
Old-age, disability, and hospital insurance.
4
Supplementary medical insurance premiums, Federal employee retirement contributions, and Civil Service retirement and disability fund.
5 Deposits of earnings by Federal Reserve Banks and other miscellaneous receipts.
6 Effective September 1976, "Interest" and "Undistributed Offsetting
Receipts" reflect the accounting conversion for the interest on special
issues for U.S. Government accounts from an accrual basis to a cash basis.




7
Consists of interest received by trust funds, rents and royalties on
the Outer Continental Shelf, and U.S. Government contributions for
employee
retirement.
8
For some types of outlays the categories are new or represent regroupings; data for these categories are from the Budget of the United
States Government, Fiscal Year 1979; data are not available for half years
or for months prior to February 1978.
Two categories have been renamed: "Law enforcement and justice"
has become "Administration of justice" and "Revenue sharing and
general purpose fiscal assistance" has become "General purpose fiscal
assistance."
In addition, for some categories the table includes revisions in figures
published earlier.

A32
1.41

DomesticNonfinancialStatistics • January 1979
FEDERAL DEBT SUBJECT TO STATUTORY LIMITATION
Billions of dollars
1977

1976

1978

Item
June 30

Sept. 30

Dec. 31

June 30

Dec. 31

Sept. 30

Mar. 31

June 20

Sept. 30
780.4

1 Federal debt outstanding

631.9

2 646.4

665.5

685.2

709.1

729.2

747.8

758.8

2 Public debt securities

620.4

653.5

674.4

698.8

718.9

738.0

749.0

771.5

3
4

Held by public
Held by agencies

470.8
149.6

634.7
488.6
146.1

506.4
147.1

523.2
151.2

543.4
155.5

564.1
154.8

585.2
152.7

587.9
161.1

603.6
168.0

10.8

10.3

10.2

6
7

Held by public
Held by agencies

11.6

12.0

9.9

9.8

9.5
2.0

29.7
1.9

10.0
1.9

9.0
1.8

8.5
1.8

8.4
1.8

8.1
1.8

8.0
1.8

621.6

635.8

654.7

675.6

700.0

720.1

739.1

750.2

772.7

9 Public debt securities
10 Other debt i

619.8
1.7

634.1
1.7

652.9
1.7

673.8
1.7

698.2
1.7

718.3
1.7

737.3
1.8

748.4
1.8

770.9
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

11.5

8 Debt subject to statutory limit

1 Includes guaranteed debt of Govt, agencies, specified participation
certificates, notes to international lending organizations, and District of
Columbia stadium bonds.
2 Gross Federal debt and agency debt held by the public increased

8.9
1.4

1.5

$0.5 billion due to a retroactive reclassification of the Export-Import Bank
certificates of beneficial interest from loan asset sales to debt, effective
July 1, 1975.
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.

653.5

718.9

764.4

771.5

575.7

652.5

715.2

763.4

363.2

421.3

459.9

485.6

164.0
216.7
40.6

161.1
251.8
47.0

160.6
268.5
56.4

231.2

255.3

227.8

2.2
13.9
22.2
77.0
139.8

576.6

1 Total gross public debt

492.7

By type:
2 Interest-bearing debt

491.6

3

Marketable

282.9

4
5
6

Bills
Notes
Bonds

119.7
129.8
33.4

157.5
167.1
38.6

208.7

212.5

7

8
9
10
11
12

Nonmarketable1

Convertible bonds 2
State and local government series
Foreign issues 3
Savings bonds and notes
Government account series 4

Sept.

2.3
.6
22.8
63.8
119.1

21.6
67.9
119.4

2.3
4.5
22.3
72.3
129.7

2.3

1.2

Oct.

783.0

767.0

775.5

782.0

782.4

485.2

491.7

493.3

487.5

161.2
272.6
57.8

161.5
271.7
60.1

161.7
265.8
60.0

283.8

288.7

294.8

2.2
24.2
22.2
79.9
149.0

160.9
267.9
56.4
281.8
2.2
24.2
21.7
80.2
153.3

2.2
24.1
24.0
80.5
152.7

2.2
24.1
26.6
80.7
154.8

2.2
24.3
28.0
80.9
157.5

1.0

6.8

1.1

1.0

1.1

3.7

1.0

4.6

138.2
80.5

139.1
89.8

147.1
97.0

154.8
102.5

163.7
111.7

114.8

166.3
115.3

16
17
18
19
20
21

271.0
55.6
2.5
6.2
11.0
29.2

349.4
85.1
4.5
9.5
20.2
34.2

409.5
103.8
5.9
12.7
27.7
41.6

461.3
101.4
5.9
15.1
22.7
55.2

489.0
95.8
5.5
15.1
22.4
69.2

488.3
95.3
5.4
15.1
21.5
67.8

494.7
94.3
5.4
15.3
21.0
67.1

Private investors
Commercial banks
Mutual savings banks
Insurance companies
Other corporations
State and local governments

168.0

22
23

Individuals:
Savings bonds
Other securities

63.4
21.5

67.3
24.0

72.0
28.8

76.7
28.6

79.7
29.2

79.8
29.4

80.2
29.6

24
25

Foreign and international 6
Other miscellaneous investors 7

58.8
22.8

66.5
38.0

78.1
38.9

109.6
46.1

121.2

121.0
52.9

122.5
54.3

1
Includes (not shown separately): Securities issued to the Rural
Electrification Administration and to State and local governments, depositary bonds, retirement plan bonds, and individual retirement bonds.
2 These nonmarketable bonds, also known as Investment Series B
Bonds, may be exchanged (or converted) at the owner's option for 1 Vi
per cent, 5-year marketable Treasury notes. Convertible bonds that have
been so exchanged are removed from this category and recorded in the
notes category above.
3 Nonmarketable foreign government dollar-denominated and foreign
currency denominated series.
4
Held almost entirely by U.S. Govt, agencies and trust funds.
5 Data for F.R. Banks and U.S. Govt, agencies and trust funds are
actual holdings; data for other groups are Treasury estimates.




Dec.

776.4

By holder.-5
14
U.S. Government agencies and trust funds
15
Federal Reserve Banks

13 Non-interest-bearing d e b t . . .

Nov.

50.9

789.2

6
Consists of the investments of foreign balances and international
accounts in the United States. Beginning with July 1974, the figures exclude
non-interest-bearing notes issued to the International Monetary Fund.
7
Includes savings and loan associations, nonprofit institutions, corporate pension trust funds, dealers and brokers, certain Govt, deposit
accounts, and Govt.-sponsored agencies.

NOTE.—Gross public debt excludes guaranteed agency securities and,
beginning in July 1974, includes Federal Financing Bank security issues.
Data by type of security from Monthly Statement of the Public Debt of
the United States (U.S. Treasury Dept.); data by holder from Treasury
Bulletin.

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

1976

1976

1977
Sept.

Sept.

Oct.

1 All holders

4 Private

5
6
7
8
9
10
11

investors

Commercial banks
Mutual savings banks
Insurance companies
Nonfinancial corporations
Savings and loan associations
State and local governments
All others

421,276

459,927

485,155

491,651

141,132

151,264

168,474

171,802

16,485
96,971

14,420
101,191

13,886
114,769

13,885
115,322

6,141
31,249

4,788
27,012

3,705
31,775

3,705
32,033

307,820

344,315

356,501

362,443

78,262
4,072
10,284
14,193
4,576
12,252
184,182

75,363
4,379
12,378
9,474
4,817
15,495
222,409

70,706
3,740
11,805
9,092
4,369
18,075
238,714

69,906
3,744
11,994
8,791
4,312
17,594
246,102

103,742

40,005
2,010
3,885
2,618
2,360
2,543
50,321

13 U.S. government agencies and trust funds
14 Federal Reserve Banks
15 Private

16
17
18
19
20
21
22

investors

Commercial banks
Mutual savings banks
Insurance companies
Nonfinancial corporations
Savings and loan associations
State and local governments
All others

24 U.S. government agencies and trust funds
25 Federal Reserve Banks
2 6 Private

27
28
29
30
31
32
33

investors

Commercial banks
Mutual savings banks
Insurance companies
Nonfinancial corporations
Savings and loan associations
State and local governments
All others

38,691
2,112
4,729
3,183
2,368
3,875
64,505

132,993

40,733
2,062
4,991
4,793
2,441
4,494
73,479

136,064

40,841
2,080
4,981
4,522
2,546
4,316
76,777

211,035

230,691

225,396

227,101

43,045

45,328

49,273

49,271

2,012
51,569

1,906
56,702

2,281
59,296

2,281
59,483

2,879
9,148

2,129
10,404

1,987
13,786

1,987
13,807

157,454

31,213
1,214
2,191
11,009
1,984
6,622
103,220

172,084
29,All

1,400
2,398
5,770
2,236
7,917
122,885

163,819

165,337

31,018

32,795

33,500

33,476

20,007
880
1,685
3,655
1,726
7,699
128,167

19,116
845
1,788
3,725
1,563
7,202
131,097

6,278
567
2,546
370
155
1,465
19,637

6,162
584
3,204
307
143
1,283
21,112

7,423
539
2,931
311
129
1,519
20,648

7,354
543
2,970
361
131
1,595
20,521

10 to 20 years

Bills, within 1 year
23 AU holders

119,464

5 to 10 years

Total, within 1 year
12 All holders

Oct.

1 to 5 years

All maturities

2 U.S. government agencies and trust funds
3 Federal Reserve Banks

1977

163,992
449
41,279
122,264

17,303
454
1,463
9,939
1,266
5,556
86,282

161,081
32
42,004
119,035

11,996
484
1,187
4,329
806
6,092
94,152

160,936
48,160
112,775

5,862
199
750
1,657
373
5,280
98,654

161,227

11,865

12,906

16,573

18,052

2
48,450

3,102
1,363

3,102
1,510

3,273
1,917

3,273
2,033

112,775

7,400

8,295

4,545
195
818
1,358
290
4,774
100,796

339
139
1,114
142
64
718
4,884

456
137
1,245
133
54
890
5,380

11,383

1,060
132
1,304
162
56
1,080
7,590

12,746

1,212
151
1,354
132
55
1,133
8,702

Over 20 years

Other, within 1 year
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
36 Federal Reserve Banks

1,563
10,290

1,874
14,698

2,280
11,136

2,279
11,033

2,350
3,642

2,495
5,564

2,640
7,994

2,639
7,966

37 Private

35,190

53,039

51,044

52,561

8,208

13,910
760
728
1,070
718
1,066
16,938

15,482
916
1,211
1,441
1,430
r
l,825
28,733

14,145
681
934
1,998
1,353
2,419
29,513

14,571
650
970
2,368
1,273
2,428
30,301

427
143
548
55
13
904
6,120

38
39
40
41
42
43
44

investors

Commercial banks
Mutual savings banks
Insurance companies
Nonfinancial corporations
Savings and loan associations
State and local governments
All others

NOTE.—Direct public issues only. Based on Treasury Survey of Ownership from Treasury Bulletin (U.S. Treasury Dept.).
Data complete for U.S. govt, agencies and trust funds and F.R. Banks,
but data for other groups include only holdings of those institutions
that report. The following figures show, for each category, the number
and proportion reporting as of Oct. 31, 1978: (1) 5,465 commercial banks




11,679

578
146
802
81
16
1,530
8,526

14,805

1,483
128
894
171
18
3,282
8,830

14,820

1,383
118
900
51
17
3,347
9,003

464 mutual savings banks, and 728 insurance companies, each about 80
per cent; (2) 435 nonfinancial corporations and 485 savings and loan
associations, each about 50 per cent; and (3) 493 State and local governments, about 40 per cent.
"All others," a residual, includes holdings of all those not reporting
in the Treasury Survey, including investor groups not listed separately.

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, week ending Wednesday—

1978
Item

1975

1977

1976

Sept.
1 U.S. government securities..
By maturity:
Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years

2
3
4
5
6

6,027

10,449

3,889
223
1,414
363
138

6,676
210
2,317
1,019
229

Oct.

Nov.

Oct. 11

Oct. 18

Oct. 25

Nov. 1

Nov. 8

Nov. 15

10,838

9,526

r

9,817

11,844

9,347

10,244

9,989

12,220

12,871

13,354

6,746
237
2,320
1,148
388

5,552
315
1,863
802
994

'6,289
420
1,520
691
897

6,573
449
2,301
1,207
1,314

6,271
336
1,233
640
866

7,182
292
1,234
690
846

6,540
372
1,545
618
914

6,149
661
3,265
991
1,153

6,075
333
2,508
1,709
2,246

7,661
577
2,081
1,518
1,517

r

By type of customer:
U.S. government securities
dealers
8
U.S. government securities
brokers
9
Commercial banks
10
All others i

885

1,360

1,267

921

983

908

1,132

965

1,019

911

949

1,045

1,750
1,451
1,941

3,407
2,426
3,257

3,709
2,295
r
3,568

3,868
1,473
3,263

4,052
1,404
'3,377

5,321
1,834
3,780

3,513
1,255
3,446

4,523
1,432
3,325

3,921
1,342
3,706

5,663
1,962
3,684

5,927
1,920
4,075

5,754
2,115
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

7

1

Includes, among others, all other dealers and brokers in commodities
and securities, foreign banking agencies, and the F.R. System.
NOTE.—Averages for transactions are based on number of trading days
in the period.

Transactions are market purchases and sales of U.S. govt, securities
dealers reporting to the F.R. Bank of New York. The figures exclude
allotments of, and exchanges for, new U.S. govt, securities, redemptions
of called or matured securities, or purchases or sales of securities under
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
Item

1975

1976

1978, week ending Wednesday—

1977
Sept.

Oct.

Nov.

Sept. 20 Sept. 27

Oct. 4

Oct. 11

Oct. 18

Oct. 25

Positions 2
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
3
4
5
6

4,297
265
886
300
136

6,290
188
515
402
198

4,772
99
60
92
149

2,824
405
-320
11
28

'1,739
462
-593
-207
23

1,958
60
-228
413
213

3,853
430
-456
22
58

1,789
445
-480
-194
-70

1,939
493
-643
-126
258

1,652
425
-695
-153
53

1,759
518
-888
-195
38

1,507
540
-660
-247
78

'939

729

693

977

234

217

1,161

800

577

387

204

82

Bills
Other within 1 year
1-5 years
5-10 years
Over 10 years

7 Federal agency securities....

Sources of financing3
8 All sources
9
10
11
12

Commercial banks:
New York City
Outside New York City...
Corporations 1
All others

6,666

8,715

9,877

11,558

10,430

11,396

12,814

10,122

9,734

10,337

10,426

10,275

1,621
1,466
842
2,738

1,896
1,660
1,479
3,681

1,313
1,987
'2,423
'4,155

997
2,344
2,287
5,930

385
2,105
2,396
5,543

347
2,032
3,007
6,010

1,213
2,904
2,295
6,402

626
2,069
2,096
5,331

696
1,816
1,855
5,367

463
2,164
2,214
5,496

234
2,278
2,530
5,384

460
1,811
2,632
5,371

1
All business corporations except commercial banks and insurance
companies.
2
New amounts (in terms of par values) of securities owned by nonbank
dealer firms and dealer departments of commercial banks on a commitment, that is, trade-date basis, including any such securities that have
been sold under agreements to repurchase. The maturities of some repurchase agreements are sufficiently long, however, to suggest that the
securities involved are not available for trading purposes. Securities
owned, and hence dealer positions, do not include securities purchased
under agreements to resell.
3
Total amounts outstanding of funds borrowed by nonbank dealer




firms and dealer departments of commercial banks against U.S. govt,
and Federal agency securities (through both collateral loans and sales
under agreements to repurchase), plus internal funds used by bank dealer
departments to finance positions in such securities. Borrowings against
securities held under agreement to resell are excluded where the borrowing
contract and the agreement to resell are equal in amount and maturity,
that is, a matched agreement.
NOTE.—Averages for positions are based on number of trading days
in the period; those for financing, on the number of calendar days in the
period.

Federal Finance
1.46

F E D E R A L A N D F E D E R A L L Y SPONSORED CREDIT AGENCIES

A35

Debt Outstanding

Millions of dollars, end of period
1978
Agency

1975

1 Federal and Federally sponsored agencies

97,680

2 Federal

19,046

3
4
5
6
7
8
9

Defense Department 1
Export-Import Bank 2 • 3
Federal Housing Administration 4
Government National Mortgage Association
participation certificates 5
Postal Service 6
Tennessee Valley Authority
United States Railway Association 6

10 Federally

11
12
13
14
15
16
17
18

agencies

sponsored

agencies

Federal home loan banks
Federal Home Loan Mortgage Corporation.
Federal National Mortgage Association
Federal land banks
Federal intermediate credit banks
Banks for cooperatives
Student Loan Marketing Association 7
Other

1,220
7,188
564

4,200
1,750
3,915
209

1976

25
26
27

Other lending:9
Farmers Home Administration
Rural Electrification Administration
Other

June

July

Aug.

Sept.

Oct.

110,409

119,728

121,239

123,497

124,478

126,579

128,655

21,896

23,245

23,864

23,983

24,145

23,686

24,321

24,466

1,113
7,801
575

983
9,156
581

935
9,416
608

926
9,455
606

916
9,455
603

906
9,455
603

897
9,891
601

897
9,891
598

4,120
2,998
5,185
104

3,743
2,431
6,015
336

3,701
2,364
6,485
355

3,701
2,364
6,575
356

3,666
2,364
6,785
356

3,166
2,364
6,835
357

3,166
2,364
7,045
357

3,166
2,364
7,195
355

78,634

81,429

87,164

95,864

97.256

99,352

18,900
1,550
29,963
15,000
9,254
3,655
310
2

16,811
1,690
30,565
17.127
10,494
4,330
410
2

18,345
1,686
31,890
19,118
11,174
4,434
515
2

22,217
1,637
35,297
19,686
11,081
5,264
680
2

22,306
1,937
36,404
19,686
11.257
4,974
690
2

23,430
1,937
36,900
20,198
11,392
4,788
705
2

24,360
1,937
37,518
20,198
11,482
4,570
725
2

25,025
2,063
38,353
20,198
11,555
4,317
745
2

25,395
2,063
39,776
20,360
11,554
4,264
775
2

17,154

28,711

38,580

43,871

44,504

45,550

46,668

48,078

49,212

4,595
1,500
310
1,840
209

5,208
2,748
410
3,110
104

5,834
2,181
515
4,190
336

6,094
2,114
680
4,660
355

6,132
2,114
690
4,750
356

6,132
2,114
705
4,960
356

6,132
2,114
725
5,010
357

6,568
2,114
745
5,220
357

6,568
2,114
775
5,370
355

7,000
566
1,134

10,750
1,415
4,966

16,095
2,647
6,782

20,090
3,498
6,380

20,910
3,602
5,950

21,580
3,684
6,019

22,275
3,919
6,136

22,275
4,192
6,607

23,050
4,407
6,573

1
Consists of mortgages assumed by the Defense Department between
1957 and 1963 under family housing and homeowners assistance programs.
2
Includes participation certificates reclassified as debt beginning
Oct. 1, 1976.
3
Off-budget Aug. 17,1974, through Sept. 30,1976; on-budget thereafter.
4
Consists of debentures issued in payment of Federal Housing Administration insurance claims. Once issued, these securities may be sold
privately on the securities market.
5
Certificates of participation issued prior to fiscal 1969 by the Government National Mortgage Association acting as trustee for the Farmers
Home Administration; Department of Health, Education, and Welfare;
Department of Housing and Urban Development; Small Business Administration; and the Veterans Administration.
6
Off-budget.




May
103,325

MEMO ITEMS :

19 Federal Financing Bank debt 6 , 8
Lending to Federal and Federally sponsored
agencies :
20
Export-Import Bank 3
21
Postal Service 6
22
Student Loan Marketing Association 7
23
Tennessee Valley Authority
24
United States Railway Association 6

1977

100,792

102,258

104,189

7
Unlike other Federally sponsored agencies, the Student Loan
Marketing Association may borrow from the Federal Financing Bank
(FFB) since its obligations are guaranteed by the Department of Health,
Education, and Welfare.
8
The FFB, which began operations in 1974, is authorized to purchase
or sell obligations issued, sold, or guaranteed by other Federal agencies.
Since FFB incurs debt solely for the purpose of lending to other agencies,
its debt is not included in the main portion of the table in order to avoid
double counting.
9
Includes FFB purchases of agency assets and guaranteed loans;
the latter contain loans guaranteed by numerous agencies with the
guarantees of any particular agency being generally small. The Farmers
Home Administration item consists exclusively of agency assets, while the
Rural Electrification Administration entry contains both agency assets
and guaranteed loans.

A36

DomesticNonfinancialStatistics • January 1979

1.47 NEW SECURITY ISSUES of State and Local Governments
Millions of dollars
1978
Type of issue or issuer,
or use

1 All issues, new and refunding i
2
3
4
5

By type of issue:
General obligation
Revenue
Housing Assistance Administration
U.S. Government loans

30,607

2

Special district and statutory authority
Municipalities, counties, townships, school d i s t r i c t s . . . .

9 Issues for new capital, total
By use of proceeds:
10
Education
Transportation
11
12
13
14
Industrial aid
15
Other purposes

Sept. r

Oct. r

Nov.

6,397

2,296

3,138

4,083

l,065
2,844

r
2,158
r

4,230

702
1,587

1,146
1,979

1,156
2,919

3

9

7

13

8

919
3,106
2,363

85
1,566
636

551
1,577
996

341
2,702
1,031

July

4,363

-3,912

r

r

18,040
17,140

18,042
28,655

1,986
2,369

76

133

72

8

7,438
12,441
10,660

7,054
15,304
12,845

6,354
21,717
18,623

912
1,461
1,981

29,495

32,108

36,189

4,689
2,208
7,209
4,392
445
10,552

4,900
2,586
9,594
6,566
483
7,979

5,076
2,951
8,119
8,274
4,676
7,093

r

Aug.

June

16,020
14,511

r

r

650
2,168
l,090

r

3,868

'3,487

'3,349

2,231

3,051

3,973

406
360
819
698
421
r
l,164

499
292
942
r
l,237
238
279

277
632
686
r
959
338
457

397
302
693
501
97
241

313
422
827
1,151
165
173

448
258
1,218
725
197
1,127

r

r

SOURCE.—Public Securities Association.

1 Par amounts of long-term issues based on date of sale.
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

46,769

35,313

By type of issuer:
6
7
8

1977

1976

1975

NEW SECURITY ISSUES of Corporations
Millions of dollars

Type of issue or issuer,
or use

1

1976

1975

1978

1977
Mar.

April

May

June

July

Aug.

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
4
Private placement

32,583
10,172

26,453
15,927

24,186
18,007

1,902
1,718

,958
853

1,719
1,277

1,744
2,066

2,177
1,541

1,497
1,032

16,980
2,750
3,439
9,658
3,464
6,469

13,264
4,372
4,387
8,297
2,787
9,274

12,510
5,887
2,033
8,261
3,059
10,438

1,155
428
217
631
291
898

534
421
291
505
35
1,027

837
314
244
885
714

1,105
562
225
815
344
761

675
417
235
768
326
1,296

485
414
115
521
546
448

10,863

11,108

12,013

822

474

1,039

1,405

508

782

3,458
7,405

2,803
8,305

3,878
8,135

148
674

235
239

390
649

586
819

57
451

157
625

1,670
1,470

2,237
1,183
24
6,121
776
771

1,265
1,838
418
6,058
1,379
1,054

74
94

41
90
20
800

28

10

88

366
245
38
429
5
320

167
167
40
31
27
76

236
110

627

15
183
28
238

1 AH issues

5
6
7
8
9
10

By industry group:
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial

11 Stocks
By type:
12
Preferred
13
Common
14
15
16
17
18
19

By industry group:
Manufacturing
Commercial and miscellaneous
Transportation
Public utility
Communication
Real estate and financial

6,235
1,002
488

i Figures, which represent gross proceeds of issues maturing in more
than 1 year, sold for cash in the United States, are principal amount or
number of units multiplied by offering price. Excludes offerings of less
than $100,000, secondary offerings, undefined or exempted issues as
defined in the Securities Act of 1933, employee stock plans, investment




354
6
75

companies other than closed-end, intracorporate transactions, and sales to
foreigners.
SOURCE.—Securities and Exchange Commission.

Corporate Finance
1.49 OPEN-END INVESTMENT COMPANIES

A37

Net Sales and Asset Position

Millions of dollars
1978
Item

1976

1977
May

June

Aug.

July

Oct.

Sept.

Nov.

INVESTMENT COMPANIES
excluding money market funds
1
2
3

Sales of own shares 1
Redemptions of own shares 2

4
5
6

Assets 3
Cash position 4
Other

4,226
6,802
-2,496

6,401
6,027
357

558
831
-273

487
757
-270

474
645
-181

638
882
-244

519
673
-154

47,537
2,747
44,790

45,049
3,274
41,775

46,969
4,642
42,327

46,106
4,493
41,613

47,975
4,285
43,690

49,299
3,948
45,351

48,151
3,703
44,448

1
Includes reinvestment of investment income dividends. Excludes
reinvestment of capital gains distributions and share issue of conversions
from one fund to another in the same group.
2 Excludes share redemption resulting from conversions from one fund
to another in the same group.
3 Market value at end of period, less current liabilities.

r

463
607
-144

478
439
39

43,462
r
3,793
39,669

44,134
4,327
39,807

4 Also includes all U.S. Government securities and other short-term
debt securities.
NOTE.—Investment Company Institute data based on reports of members, which comprise substantially all open-end investment companies
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
Account

1975

1976

1978

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
3 Profits after tax

49.8
70.6

64.3
91.6

71.8
102.1

68.3
96.5

72.3
102.8

72.8
104.7

73.9
104.4

70.0
102.1

85.0
120.5

86.2
119.2

4 Dividends
5 Undistributed profits

31.9
38.7

37.9
53.7

43.7
58.4

41.5
55.0

42.7

60.1

44.1
60.6

46.3
58.1

47.0
55.1

48.1
72.4

50.1
69.1

89.2
127.9

97.1
150.8

106.0
164.4

102.0
157.0

105.0
165.1

107.6
168.2

109.3
167.4

111.3
166.4

113.3
185.7

115.4
184.5

6 Capital consumption allowances
7 Net cash flow

SOURCE.—Survey of Current Business (U.S. Dept. of Commerce).




A38
1.51

DomesticNonfinancialStatistics • January 1979
N O N F I N A N C I A L CORPORATIONS

Current Assets and Liabilities

Billions of dollars, except for ratio
1977

1976
Account

1 Current assets

1974

1978

1975

756.3

734.6

Q2r

Q3

Q4

Ql

Q2

Q3

Q4

817.4

823.1

842.0

856.4

880.3

900.1

924.2

953.5

80.8
26.8
304.1
352.1
78.3

83.1
22.1
312.8
358.8
79.6

83.4
21.5
326.9
367.5
81.0

94.2
20.9
325.7
375.0
84.3

88.5
20.9
338.3
389.7
86.8

90.9
19.7
356.8
399.1
87.0

Ql

73.0
11.3
265.5
318.9
65.9

80.0
19.6
272.1
314.7
69.9

79.5
24.1
297.9
342.2
73.6

86.8
26.0
292.4
341.4
76.4

7 Current liabilities

451.8

446.9

484.0

487.5

502.6

509.5

528.9

543.2

570.4

590.8

8
9

272.3
179.5

261.2
185.7

271.2
212.8

273.2
214.2

280.2
222.4

286.8
222.7

297.8
231.1

306.8
236.3

317.2
253.2

331.3
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 ratio 1

1.626

1.693

1.689

1.688

1.675

1.681

1.664

1.657

1.620

1.614

2
3
4
5
6

Cash
U.S. Government securities
Notes and accounts receivable
Inventories
Other

Notes and accounts payable
Other

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 E X P E N D I T U R E S on New Plant and Equipment
Billions of dollars; quarterly data are at seasonally adjusted annual rates.
1977
Industry

1 All industries
Manufacturing
2
Durable goods industries
Nondurable goods industries
3
4
5
6
7
8
9
10
11

Nonmanufacturing
Mining
Transportation:
Railroad
Air
Other
Public utilities:
Electric
Gas and other
Communication
Commercial and other 1
1
2

Ql

Q2

Q3

Q4

Ql

Q2

Q3

Q4

135.72

152.28

130.16

134.24

140.38

138.11

144.25

150.76

155.13

158.98

27.75
32.33

31.53
36.23

26.30
30.13

27.26
32. 19

29.23
33.79

28.19
33.22

28.72
32.86

31.40
35.80

32.11
36.54

33.89
39.72

4.49

4.78

4.24

4.49

4.74

4.50

4.45

4.81

4.80

5.07

2.82
1.63
2.55

3.28
2.45
2.27

2.71
1.62
2.96

2.57
1.43
2.96

3.20
1.69
1.96

2.80
1.76
2.32

3.35
2.67
2.44

3.09
2.08
2.23

3.64
2.97
2.37

3.05
2.08
2.05

21.57
4.21
15.43
22.95

24.49
4.48

21.19
4.16
14.19
22.67

21.14
4. 16
15.32
22.73

21.90
4.32
16.40
23.14

22.05
4.18
15.82
23.27

23.15
4.78
17.07
24.76

23.83
4.62
18.18
24.71

25.04
4.22
} 43.44

25.94
4.28
42.90

Includes trade, service, construction, finance, and insurance.
Anticipated by business.

NOTE.—Estimates for corporate and noncorporate business, excluding




1978

19782

1977

agriculture; real estate operators; medical, legal, educational, and cultural
service; and nonprofit organizations.
SOURCE.—Survey of Current Business (U.S. Dept. of Commerce).

Corporate Finance
1.521

DOMESTIC FINANCE COMPANIES

A39

Assets and Liabilities

Billions of dollars, end of period
1977
1973

1972

Account

1974

1975

1978

1976
Q3

Q4

Q1

Q2

Q3

ASSETS
Accounts receivable, gross
1
Consumer
2
Business

31.9
27.4

35.4
32.3

36.1
37.2

36.0
39.3

38.6
44.7

42.3
50.6

44.0
55.2

3

59.3

67.7

73.3

75.3

83.4

92.9

7.4
51.9
2.8
.9
10.0

8.4
59.3
2.6
.8
10.6

9.0
64.2
3.0
.4
12.0

9.4
65.9
2.9
1.0
11.8

99.2

10.5
72.9
2.6
1.1
12.6

11.7
81.2
2.5
1.8
14.2

12.7
86.5
2.6
.9
14.3

12.8
89.3
2.2
1.2
15.0

14.1
92.6
2.9
1.3
16.2

14.3
93.7
2.7
1.8
17.1

65.6

73.2

79.6

81.6

89.2

99.6

104.3

107.7

112.9

115.3

5.6
17.3

7.2
19.7

9.7
20.7

8.0
22.2

6.3
23.7

5.4
25.7

5.9
29.6

5.8
29.9

5.4
31.3

5.4
29.3

4.3
22.7
4.8

4.6
24.6
5.6

4.9
26.5
5.5

4.5
27.6
6.8

5.4
32.3
8.1

5.4
34.8
13.7

6.2
36.0
11.5

5.3
38.0
12.9

6.6
40.1
13.6

6.8
41.3
15.2

Total

4
5
6
7
8

LESS: Reserves for unearned income and losses
Accounts receivable, net
Cash and bank deposits
Securities
All other

9 Total assets

44.5
57.6
102.1

47.1
59.5
106.6

49.7
58.3
108.0

LIABILITIES
10 Bank loans
11 Commercial paper
Debt:
12
Short-term, n.e.c
13
Long-term, n.e.c
14
Other
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

Type

Accounts
receivable
outstanding Oct. 31,
19781

Changes in accounts
receivable during—

Extensions

Repayments

1978

1978

1978

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)
3 Wholesale automotive
4 Retail paper on business, industrial, and
farm equipment
5 Loans on commercial accounts receivable...
6 Factored commercial accounts receivable....
7 All other business credit

14,067
11,099

247
-77

209
-506

214
103

1,222
6,314

1,202
6,119

1,237
6,171

975
6,391

993
6,625

1,023
6,068

16,246
4,080
2,493
12,075

295
-19
55
215

-154
150
83
-16

160
-202
291
138

1,225
3,269
1,481
1,906

1,198
3,454
1,584
1,973

1,041
3,233
1,543
1,853

930
3,288
1,426
1,691

1,352
3,304
1,501
1,989

881
3,435
1,252
1,715

1

Not seasonally adjusted.




A40

DomesticNonfinancialStatistics • 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

1
2
3
4
5
6
7
8

Conventional mortgages on new homes
Terms: 1
Purchase price (thous. dollars)
Amount of loan (thous. dollars)
Loan/price ratio (per cent)
Maturity (years)
Fees and charges (per cent of loan amount) 2 .
Contract rate (per cent per annum)
Yield (per cent per
annum):
FHLBB series3
H U D series 4

44.6
33.3
74.7
26.8
1.54
8.75

48.4
35.9
74.2
27.2
1.44
8.76

54.3
40.5
76.3
27.9
1.33
8.80

62.6
45.9
75.6
28.3
1.40
9.23

61.9
45.3
75.3
28.2
1.40
9.34

63.6
46.4
75.3
28.0
1.43
9.45

64.6
46.7
74.1
27.8
1.36
9.50

66.8
48.6
74.4
28.0
1.37
r
9.60

65.1
47.5
74.4
27.9
1.40
9.63

9.01
9.10

8.99
8.99

9.01
8.95

9.46
9.75

9.57
9.80

9.70
9.80

9.73
9.80

r

9.83
9.95

9.87
10.10

9.19
8.52

8.82
8.17

7.96
8.04

9.05

9.92
9.16

9.78
8.96

9.78
8.95

9.93
9.16

9 99
9.13

9.26
9.37

8.99
9.11

8.73
8.98

9.91
10.10

10.01
10.19

9.81
10.11

9.78
10.02

10.03
10.19

10.30
10.56

SECONDARY MARKETS
9
10

Yields (per cent per annum):
FHA mortgages (HUD series)5
FNMA auctions:

11
12

7

Conventional loans

Activity in secondary markets
FEDERAL NATIONAL
MORTGAGE ASSOCIATION
13
14
15
16

Mortgage holdings (end of period)
Total
V A-guaranteed

31,824
19,732
9,573
2,519

32,904
18,916
9,212
4,776

34,370
18,457
9,315
6,597

38,753
19,608
10,398
8,747

39,409
19,763
10,457
9,189

40,325
20,034
10,535
9,752

41,189
20,325
10,575
10,289

41,957
20,625
10,565
10,767

42,590
20,929
10,535
11,126

4,263
2

3,606
86

497

1,148

945

1,230

1,132

1,053

920

6,106
4,126

6,247
3,398

1,333
4,698

1,517
10,395

927
10,171

527
9,419

882
9,068

1,900
9,547

1,275
9,525

7,042.6
3,848.3

4,929.8
2,787.2

1,184.5
794.0

1,095.0
636.6

756.7
471.5

499.1
277.2

717.9
335.9

1,964.8
832.4

788.0
321.8

1,401.3
765.0

2,595.7
1,879.2

591.6
359.4

574.5
342.0

316.0
178.9

224.7
128.5

484.7
283.7

1,156.8
495.6

861.4
386.8

4,987
1,824
3,163

4,269
1,618
2,651

3,276
1,395
1,881

2,255
1,338
917

2,024
1,321
702

2,448
1,304
1,144

2,486
1,287
1,199

2,867
1,594
1,273

3,022
1,257
1,766

1,716
1,020

1,175
1,396

489
477

500
1,093

520
725

742
299

670
594

791
369

763
581

982
111

1,477
333

361
1,063

762
1,870

737
2,055

838
2,142

760
2,130

547
1,716

706
1,617

Mortgage transactions (during period)
17
18
19
20

21
22
23
24

Sales
Mortgage commitments: 8
Contracted (during period)
Outstanding (end of period).
Auction of 4-month commitments to buy—
Government-underwritten
loans:
Offered 9
Conventional
loans:
Offered 9
FEDERAL HOME LOAN
MORTGAGE CORPORATION

25
26
27

Mortgage holdings (end of period) 10
Total
FHA/VA
Mortgage transactions (during period)

28
29
30
31

Sales
Mortgage commitments: 11
Contracted (during period)
Outstanding (end of period)

1
Weighted averages based on sample surveys of mortgages originated
by major institutional lender groups. Compiled by the Federal Home
Loan Bank Board in cooperation with the Federal Deposit Insurance
Corporation.
2
Includes all fees, commissions, discounts, and "points" paid (by the
borrower
or the seller) in order to obtain a loan.
3
Average effective interest rates on loans closed, assuming prepayment
at the end of 10 years.
4
Average contract rates on new commitments for conventional first
mortgages, rounded to the nearest 5 basis points; from Dept. of Housing
and5 Urban Development.
Average gross yields on 30-year, minimum-downpayment, Federal
Housing Administration-insured first mortgages for immediate delivery
in the private secondary market. Any gaps in data are due to periods of
adjustment to changes in maximum permissible contract rates.
6
Average net yields to investors on Government National Mortgage
Association-guaranteed, mortgage-backed, fully-modified pass-through




securities, assuming prepayment in 12 years on pools of 30-year FHA/VA
mortgages carrying the prevailing ceiling rate. Monthly figures are
unweighted averages of Monday quotations for the month.
7
Average gross yields (before deduction of 38 basis points for mortgage
servicing) on accepted bids in Federal National Mortgage Association's
auctions of 4-month commitments to purchase home mortgages, assuming
prepayment in 12 years for 30-year mortgages. No adjustments are made
for FNMA commitment fees or stock related requirements. Monthly
figures
are unweighted averages for auctions conducted within the month.
8
Includes some multifamily and nonprofit hospital loan commitments
in addition to 1- to 4-family loan commitments accepted in FNMA's
free market auction system, and through the FNMA-GNMA Tandem
plans.
9
Mortgage amounts offered by bidders are total bids received.
I
o Includes participations as well as whole loans.
II
Includes conventional and Government-underwritten loans.

Real Estate Debt

A41

1.54 MORTGAGE DEBT OUTSTANDING
Millions of dollars, end of period
1978

1977
1973

Type of holder, and type of property

1974

1975

1976
Q4

Q1

Q2

Q3P

1 All holders
2
1- to 4-family
Multifamily
3
4
Commercial
5
Farm

682,321
416,211
93,132
131,725
41,253

742,512
449,371
99,976
146,877
46,288

801,537
490,761
100,601
159,298
50,877

889,327
556,557
104,516
171,223
57,031

1,023,417
656,116
111,804
189,829
65,668

1,052,307
675,514
114,202
194,545
68,046

1,090,234
701,392
116,793
201,054
71,004

1,128,398
727,096
119,422
208,017
73,863

6 Major financial institutions

505,400

542,560

581,193

647,650

745,011

764,614

792,762

819,264

119,068

132,105

136,186

151,326

178,979

184,423

193,223

202,423

105,115
9,215
56,898
7,751

108,699
9,387
58,407
7,930

113,886
9,816
61,194
8,327

119,308
10,283
64,107
8,725

88,104

89,800

91,535

93,511

57,637
15,304
15,110
53

58,747
15,398
15,401
54

59,882
15,900
15,698
55

61,175
16,243
16,037
56

7

8
9
10
11
12

13
14
15
16
17

18
19
20
21

22
23
24
25

banks1

Commercial

67,998
6,932
38,696
5,442

1- to 4-family
Multifamily
Commercial
Farm
Mutual

savings banks

1- to 4-family
Multifamily
Commercial
Farm
Savings

and loan associations

1- to 4-family
Multifamily
Commercial
Life insurance

companies

1- to 4-family
Multifamily
Commercial
Farm

26 Federal and related agencies
27

28
29
30

31
32
33
34
35

36
37
38

39
40
41

42
43
44

45
46

Government

National

Mortgage

Assn,

1 - t o 4-family
Multifamily
Farmers

Home

Admin

Federal Housing

and Veterans

Admin,

1 - t o 4-family
Multifamily
Federal National

Mortgage

Assn...

.

1 - t o 4-family
Multifamily
Federal

land banks

1 - t o 4-family
Farm
Federal

Home

Loan Mortgage

Corp.

1- to 4-family
Multifamily

47 Mortgage pools or trusts 2
48

49
50
51

52
53
54

55
56
57
58

Government

National

Mortgage

Assn.

1- to 4-family
Multifamily
Federal

Home

Loan Mortgage

1- to 4-family
Multifamily
Farmers

Home

Admin

1- to 4-family
Multifamily
Commercial
Farm

59 Individuals and others 3
60
1- to 4-family
61
Multifamily
62
Commercial
63
Farm

Corp.

86,234
8,082
50,289
6,721

73,230

74,920

77,249

81,639

49,213
12,923
12,722
62

50,025
13,792
13,373
59

53,089
14,177
14,313
60

231,733

249,301

278,590

323,130

381,163

392,479

407,964

420,947

187,078
22,779
21,876

200,987
23,808
24,506

223,903
25,547
29,140

260,895
28,436
33,799

310,686
32,513
37,964

319,910
33,478
39,091

332,532
34,779
40,633

343,114
35,907
41,926

81,369

86,234

89,168

91,555

96,765

97,963

100,040

102,383

20,426
18,451
36,496
5,996

19,026
19,625
41,256
6,327

17,590
19,629
45,196
6,753

16,088
19,178
48,864
7,425

14,727
18,807
54,388
8,843

14,476
18,851
55,426
9,210

14,129
18,745
57,463
9,703

13,929
18,945
59,309
10,200

46,721

58,320

66,891

66,753

70,006

72,014

73,991

77,919

4,029

4,846

7,438

4,241

3,660

3,291

1,455
2,574

2,248
2,598

4,728
2,710

1,970
2,271

1,548
2,112

948
2,343

3,283
922

1,366

1,432

1,109

1,064

1,353

1,179

759
167
156
350

208
215
190
496

454
218
72
320

626
275
149
303

202
408
218
351

3,523

2,361

989
2,534

618

668

124
102
104
288

135
110
112
311

3,476

4,015

4,970

5,150

5,212

5,219

5,225

5,295

2,013
1,463

2,009
2,006

1,990
2,980

1,676
3,474

1,627
3,585

1,585
3,634

1,543
3,682

1,565
3,730

24,175

29,578

31,824

32,904

34,369

36,029

38,753

41,189

20,370
3,805

23,778
5,800

25,813
6,011

26,934
5,970

28,504
5,865

30,208
5,821

32,974
5,779

35,437
5,752

11,071

13,863

16,563

19,125

22,136

22,925

23,857

24,758

123
10,948

406
13,457

549
16,014

601
18,524

670
21,466

691
22,234

727
23,130

819
23,939

2,604

4,586

4,987

4,269

3,276

3,371

2,255

2,486

2,446
158

4,217
369

4,588
399

3,889
380

2,738
538

2,785
586

1,856
399

1,994
492

18,040

23,799

34,138

49,801

70,289

74,080

78,602

82,325

7,890

11,769

18,257

30,572

44,896

46,357

48,032

11,249
520

17,538
719

29,5 83
989

43,555
1,341

44,906
1,451

46,515
1,517

50,844

7,561
329

2,671
2,282

6,610

7,471

9,423

9,934

5,621
989

6,286
1,185

7,797
1,626

8,358
1,576

766

757

1,598

617
149

608
149

1,349
249

389

49,276
1,568

18,783

20,252

21,147

21,547

5,458
138
1 ,124
2,664

6,782
116
1,473
2,902

9,194
295
1 ,948
2,846

10,219
532
2,440
3,367

11,379
759
2,945
3,682

12,235
732
3,528
3,757

12,742
1,128
3,301
3,976

12,943
1,154
3,380
4,070

112,160
51 ,112
23,982
21,303
15,763

117,833
53,331
24,276
23,085
17,141

119,315
56,268
22,140
22,569
18,338

125,123
62,643
20,420
21,446
20,614

138,111
71,665
20,501
22,375
23,570

141,599
73,878
20,732
22,479
24,510

144,888
75,763
20,939
22,661
25,525

148,890
78,054
21,128
23,146
26,562

9,384

11,273

1 Includes loans held by nondeposit trust companies but not bank trust
departments.
2
Outstanding principal balances of mortgages backing securities insured or guaranteed by the agency indicated.
3 Other holders include mortgage companies, real estate investment
trusts, State and local credit agencies, State and local retirement funds,
noninsured pension funds, credit unions, and U.S. agencies for which
amounts are small or separate data are not readily available.




77,018
5,915
46,882
6,371

48,811
12,343
12,012
64

743
29
218
376

1- to 4-family
Multifamily
Commercial
Farm

74,758
7,619
43,679
6,049

14,283

16,558

NOTE.—Based on data from various institutional and Govt, sources,
with some quarters estimated in part by Federal Reserve in conjunction
with the Federal Home Loan Bank Board and the Dept. of Commerce.
Separation of nonfarm mortgage debt by type of property, if not reported directly, and interpolations and extrapolations where required, are
estimated mainly by Federal Reserve. Multifamily debt refers to loans on
structures of 5 or more units.

A42
1.55

DomesticNonfinancialStatistics • January 1979
CONSUMER INSTALMENT CREDIT1 Total Outstanding, and Net ChangeA
Millions of dollars

Holder, and type of credit

1975

1976

1978

1977
May

June

July

Aug.

Sept.

Oct.

Nov.

Amounts outstanding (end of period)
1 Total
2
3
4
5
6
7
8

By major holder:
Commercial banks
Finance companies
Credit unions
Retailers 2
Savings and loans
Gasoline companies. .,
Mutual savings banks.

172,353

193,977

230,829

243,371

249,865

253,897

259,614

263,387

r

265,821

269,445

829,936
35,995
25,666
18,201
5,162
2,706
1,687

93,728
38,919
31,169
19,260
6,246
2,830
1,825

112,373
44,868
37,605
23,490
7,354
2,963
2,176

120,440
47,580
40,481
21,744
7,727
3,069
2,330

124,080
48,637
41,936
21,813
7,764
3,185
2,450

126,619
49,502
42,355
21,828
7,793
3,309
2,491

129,622
50,558
43,499
22,093
7,947
3,354
2,541

131,403
51,280
44,325
22,302
8,055
3,416
2,606

r

132,702
51,984
44,635
22,464
8,177
3,276
2,583

133,908
53,099
45,305
23,006
8,291
3,173
2,663

100,159
59,IIS

101,565

By major type of credit:
9

10
11
12
13
14
15

16
17
18

Automobile

Commercial banks. .
Indirect paper
Direct loans
Credit unions
Finance companies.,
Revolving

Commercial banks. .
Retailers
Gasoline companies.

19
20
21
22
23

Mobile

24
25
26
27
28
29
30

Other

home

Commercial banks.
Finance companies.
Savings and loans..
Credit unions
Commercial banks
Finance companies
Credit unions
Retailers
Savings and loans
Mutual savings banks.

57,242

67,707

82,911

90,359

33,287
19,332
13,955
12,741
11,214

93,261

39,621
22,072
17,549
15,238
12,848

95,289

49,577
27,379
22,198
18,099
15,235

54,078
30,169
23,909
19,357
16,924

97,687

55,754
31,128
24,626
20,054
17,453

99,062

57,071
31,907
25,164
20,254
17,964

58,453
32,667
25,786
20,801
18,433

59,085
33,067
26,018
21,196
18,781

15,019

17,189

39,274

38,967

12,313

14,359

40,001

40,553

2,830

19,378
16,520
3,069

41,629

2,706

18,374
17,937
2,963

20,135
16,681
3,185

20,566
16,678
3,309

21,314
16,961
3,354

15,141

15,396

15,532

15,663

15,799

14,434

8,667
3,445
2,050
272

14,573

8,737
3,263
2,241
332

9,124
3,077
2,538
402

9,275
3,060
2,629
432

85,658

94,508

93,503

98,649

28,669
21,336
12,653
18,201
3,112
1,687

31,011
22,808
15,599
19,260
4,005
1,825

35,298
26,556
19,104
5,553
4,816
2,176

37,709
27,596
20,692
5,224
5,098
2,330

9,386
3,065
2,634
447
101,071

38,805
28,119
21,435
5,132
5,130
2,450

9,483
3,085
2,644
451
102,392

39,499
28,453
21,650
5,150
5,149
2,491

9,539
3,101
2,696
463
104,499

40,316
29,024
22,235
5,132
5,251
2,541

33,415
26,363
21,344
19,037

60,347
33,709
26,638
21,664
19,554

42,420

42,579

43,523

21,935
17,069
3,416

22,165
17,138
3,276

22,724
17,626
3,173

15,910

15,925

16,017

9,591
3,114
2,733
472
105,995

9,548
3,127
2,775
475
r

107,158

9,572
3,150
2,813
482
108,340

40,792
29,385
22,657
5,233
5,322
2,606

Ml,211
29,820
r
22,816
5,326
5,402
2,583

41,265
30,395
23,159
5,380
5,478
2,663

Net change (during period) 3
31 Total
32
33
34
35
36
37
38

By major holder:
Commercial banks
Finance companies
Credit unions
Retailers i
Savings and loans
Gasoline companies. . .
Mutual savings banks.

7,765

21,647

35,278

4,280

4,207

3,466

3,632

3,680

'3,374

4,099

2,881
-82

10,792
2,946
5,503
1,059
1,085
124
138

18,645
5,948
6,436
2,654

2,260
861
849
135
67
22
86

2,387
624
797
234
57

2,100
671
513
144
10
-19
47

1,785
736
613
342
107
—1
50

1,714
847
639
328
94
9
49

r

1,925
1,018
779
186
88

3,766
87
829
104
180

1,111

132
352

20

l,617
863
644
115
nil

16
-8

104

By major type of credit:
39

40
41
42
43
44
45

46
47
48

Automobile

Commercial banks. .
Indirect paper
Direct loans
Credit unions
Finance companies..
Revolving

Commercial banks. .
Retailers
Gasoline companies.

49
50
51
52
53

Mobile

54
55
56
57
58
59
60

Other

home

Commercial banks.
Finance companies.
Savings and loans..
Credit unions
Commercial banks
Finance companies
Credit unions
Retailers
Savings and loans
Mutual savings banks.

2,976

10,465

15,204

1,877

1,642

1,711

1,036
646
390
377
464

1,029
587
442
349
264

1,041
626
415
275
395

6,248

644

955

4,015

132

489
133
22

140

565

101

70

70

387
-189
297
70

83

77

79

50

14

12
7

65
11
2
5

20
7
46
6

513
-392
905
1,872
591

6,334
2,742
3,592
2,497
1,634

9,956
5,307
4,649
2,861
2,387

1,340

2,170

1,236

2,046

104

124

-208

-330
-76
161
37

-182

192
60

3,657

8,872

1.462
-597
1,857
87
668
180

2,342
1,494
2,946
1,059
893
138

2,101

13,261

4,287
3,750
3,505
553
814
352

1 The Board's series cover most short- and intermediate-term credit
extended to individuals through regular business channels, usually to
finance the purchase of consumer goods and services or to refinance
debts incurred for such purposes, and scheduled to be repaid (or with
the option of repaying in two or more instalments).
2 Includes auto dealers and excludes 30-day charge credit held by
travel and entertainment companies.
3
Net change equals extensions minus liquidations (repayments, chargeoffs, and other credits); figures for all months are seasonally adjusted.




2

1,658

658
395
464
2
53
86

601
334
20

1,540

707
359
441
-100

45

1,604

1,532

r

1,375

1,755

957
515
442
287
360

848
517
331
313
371

H59

354
r
405
301
315

839
440
399
364
552

600

737

622

346

498
121
-19

358
380
-1

665

380
233
9

337
-7
16

556
110
-1

72

25

75

31
6
27
8

-25
-2
46
6

19
15
34
7

1,072

496
265
233
23
8
47

1,212

450
369
320
-38
61
50

1,454

455
470
318
95
67
49

r

1,628
r

546
550
337
122
r
81
-8

1,604

511
451
408
76
54
104

NOTE.—Total consumer noninstalment credit outstanding—credit
scheduled to be repaid in a lump sum, including single-payment loans,
charge accounts, and service credit—amounted to $58.2 billion at the end
of 1977. $55.0 billion at the end of 1976, $50.8 billion at the end of 1975,
and $48.4 billion at the end of 1974. Comparable data for Dec. 31, 1978
will be published in the February 1979 BULLETIN.
A Consumer instalment credit series have been revised from 1943,
effective Dec. 7, 1978. Information is available from Mortgage and
Consumer Finance Section, Division of Research and Statistics.

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.

Extensions 2
1 Total.
2
3
4
5
6
7
8

By major holder:
Commercial banks
Finance companies
Credit unions
Retailers 1
Savings and loans
Gasoline companies. ..
Mutual savings banks.

180,441

211,028

254,071

25,104

25,565

25,022

25,669

25,536

'25,785

80,797
31,183
24,094
27 302
3,116
12,497
1,452

97,397
36,129
29,259
29,447
3,898
13,387
1,511

117,896
41,989
34,028
39,133
4,485
14,617
1,923

12,067
4,179
3,484
3,408
383
1,356
227

12,382
4,223
3,445
3,552
379
1,351
233

12,187
4,261
3,271
3,477
327
1,299
200

12,255
4,348
3,379
3,725
435
1,317
210

12,123
4,372
3,360
3,718
403
1,346
215

'12,182
4,605
3,401
3,518
'566
1,335
151

52,420

63,743

75,641

7,592

7,595

7,652

7,744

7,542

r

30,095
16,578
13,517
12,683
9,642

37,886
20,576
17,310
14,688
11,169

46,363
25,149
21,214
16,616
12,662

4,547
2,550
1,997
1,680
1,365

4,541
2,505
2,036
1,667
1,387

4,639
2,554
2,085
1,629
1,384

4,660
2,562
2,098
1,632
1,452

4,479
2,519
1,960
1,641
1,422

'4,345
2,384
'1,961
1,643
1,513

36,956

43,934

86,756

8,563

9.062

8,700

9,028

9,006

8,846

24,459

30,547

12,497

13,387

38,256
33,883
14,617

4,191
3,016
1,356

4,451
3,260
1,351

4,320
3,081
1,299

4,346
3.365
1,317

4,457
3,203
1,346

4,475
3,036
1,335

4,328

4,859

5,425

527

510

509

531

3,064
702
929
164

3,466
643
1,120
196

346
69
92
20

327
73
90
20

335
78
78
18

310
75
127
19

494
297

604

2,625
767
815
121

By major type of credit:
9
10
11
12
13
14

Automobile.

15
16
17
18

Revolving

19
20
21
22
23

Mobile

24
25
26
27
28
29
30

Other

Commercial banks.
Indirect paper. . .
Direct loans
Credit unions
Finance companies.
Commercial banks. .
Retailers
Gasoline companies.
home

Commercial banks.
Finance companies.
Savings and loans..
Credit unions
Commercial banks
Finance companies
Credit unions
Retailers
Savings and loans
Mutual savings banks.

86,737

98,492

86,249

8,422

8,398

8,161

23,618
20,774
11,290
27,302
2,301
1,452

25,900
24,258
14,407
29,447
2,969
1,511

29,811
28,684
17,216
5,250
3,365
1,923

2,983
2,745
1,784
392
291
227

3.063
2,763
1,758
292
289
233

2,893
2,799
1,624
396
249
200

7,501

352
73
154
25

77
100
20

8.366
2,939

8,495

r

2,821
1,728
360
308
210

2,890
2,873
1,699
515
303
215

'3,010
3,019
1,733
482
'412
151

8,807

Liquidations 2
31 Total.
By major holder:
Commercial banks
Finance companies
Credit unions
Retailers 1
Savings and loans
Gasoline companies. .,
Mutual savings banks.

172,676

189,381

218,793

20,824

21,358

21,556

22,037

21,857

'22,384

77,916
31,265
20,328
27,215
2,287
12,393
1,272

86,605
33,183
23,756
28,388
2,813
13,263
1,373

99,251
36,041
27,592
36,479
3,374
14,485
1,571

9,807
3,318
2,635
3,273
316
1,334
141

9,995
3,599
2,648
3,318
322
1,331
145

10,087
3,590
2,758
3,333
317
1,318
153

10,470
3,612
2,766
3,383
328
1,318
160

10,409
3,525
2,721
3,390
309
1,337
166

10,565
3,742
2,757
3,403
439
'1,319
159

49,444

53,278

60,437

5,715

5,953

5,941

6,140

29,582
16,970
12,612
10,811
9,051

31,552
17,834
13,718
12,191
9,535

36,407
19,842
16,565
13,755
10,275

3,511
1,904
1,607
1,303
901

3,512
1,918
1,594
1,318
1,123

3,598
1,928
1,670
1,354
989

3,703
2,047
1,656
1,345
1,092

6,010
3,631
2,002
1,629
1,328
1,051

6,126
3,586
2,030
1,556
'1,342
1,198

35,616

41,764

80,508

7,919

8,107

8,384

8,500

28,501

12,393

13,263

34,241
31,782
14,485

3.702
2,883
1,334

3,850
2,926
1,331

8,100
3,822
2,960
1,318

8,291

23,223

3,988
2,985
1,318

4,077
2,970
1,337

4,138
3,043
1,319

4,536

4,719

4,860

426

440

426

452

422

579

2,955
843
654
84

2,994
884
737
104

3,079
832
823
126

269
67
78
12

277
72
78
13

270
67
76
13

290
68
81
13

266
71
73
12

377
75
108
19

By major type of credit:
39
40
41
42
43
44

Automobile

45
46
47
48

Revolving

49
50
51
52
53

Mobile

54
55
56
57
58
59
60

Other

Commercial banks. .
Indirect paper
Direct loans
Credit unions
Finance companies..
Commercial banks. .
Retailers
Gasoline companies.
home

Commercial banks.
Finance companies.
Savings and loans..
Credit unions
Commercial banks
Finance companies
Credit unions
Retailers
Savings and loans
Mutual savings banks.

83,080

89,620

72,988

6,764

6,858

7,089

7,154

7,041

179

22,156
21,371
9,433
27,215
1,633
1,272

23,558
22,764
11,461
28,388
2,076
1,373

25,524
24,934
13,711
4,697
2,551
1,571

2,325
2,350
1,320
390
238
141

2,356
2,404
1,317
392
244
145

2,397
2,534
1,391
373
241
153

2,489
2,452
1,408
398
247
160

2,435
2,403
1,381
420
236
166

464
469
396
360
331
159

1
Includes auto dealers and excludes 30-day charge credit held by
travel and entertainment companies.
2
Monthly figures are seasonally adjusted.




A Consumer instalment credit series have been revised from 1943,
effective Dec. 7, 1978. Information is available from Mortgage and Consumer Finance Section, Division of Research and Statistics.

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.

Transaction category, or sector

1973

1974

1975

1976

1975

1977
HI

1976
H2

1977

HI

H2

HI

1978
H2

HI

Nonfinancial sectors
1 Total funds raised

203.8

188.8

208.1

272.5

340.5

177.5

238.9

2

259.6

285.6

302.2

261.7

371.4

184.9

198.0

378.9

196.1

337.4

167.0

229.2

245.9

277.5

301.0

373.8

371.3

11.8
12.0
-.2
177.0
3.8
173.1
161.6
4.1

85.4
85.8
-.4
122.7
10.1
112.6
109.5
9.9

69.0
69.1
-.1
203.5
10.8
192.6
182.8
10.5

56.8
57.6
-.9
283.8
3.1
280.6
271.4
2.7

78.3
79.1
-.8
99.2
10.5
88.7
89.1
10.3

92.5
92.6
_ l
146.4
9.7
136.6
130.0
9.5

73.5
73.4
.1
186.0
13.6
172.4
168.5
13.3

64.5
64.9
-.3
221.0
8.1
213.0
197.2
7.7

42.6
43.1
-.6
259.6
1.2
258.5
252.1
.5

71.0
72.2
-1.2
307.9
5.1
302.8
290.7
4.9

312.6
.1
312.5
298.8
.9

157.5
98.0

99.6
97.8

172.3
126.8

268.7
181.1

78.8
93.7

120.5
101.9

155.2
117.8

189.5
135.9

251.6
163.4

285.8
198.9

297.9
182.7

3
4
5
6
7
8
9
10
11
12
13
14

Excluding

Debt instruments
Debt capital instruments

State and local obligations....
Corporate bonds
Mortgages :
Home
Multifamily residential
Commercial
Farm

15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36

equities

By sector and instrument:
U.S. government
8.3
Public debt securities
7.9
Agency issues and mortgages
.4
All other nonfinancial sectors
195.5
Corporate equities
7.7
Debt instruments
187.9
Private domestic nonfinancial sectors. . 189.3
Corporate equities
7.9

Other

debt instruments

Consumer credit
Bank loans n.e.c
Open market paper
Other
By borrowing

sector

State and local governments
Households
Farm
Nonfarm noncorporate
Corporate
Foreign
Corporate equities
Debt

instruments

Bonds
Bank loans n.e.c
Open market paper
U.S. government loans

181.4
105.0

58.8
59.1
-.9

14.7
9.2

16.5
19.7

15.6
27.2

19.0
22.8

29.2
21.0

11.1
34.5

20.0
19.9

19.3
22.2

18.7
23.5

29.3
16.0

29.0
26.0

29.0
18.4

46.4
10.4
18.9
5.5

34.8
6.9
15.1
5.0

39.5

63.7
1.8
13.4
6.1

96.4
7.4
18.4
8.8

33.9
.1
9.1
5.1

45.1
-.1
12.9
4.1

56.9
.6
13.8
4.9

70.5
3.1
12.9
7.3

88.5
6.4
14.2
8.9

104.2
8.4
22.6
8.7

91.4
9.7
24.5
9.8

76.4

59.6

45.5

87.6

88.2

10.2
29.0
6.6
13.7

23.6
3.5
4.0
14.4

35.0
30.6
2.9
19.0

37.4
22.9

53.6

86.9

23.8
39.8
2.5
10.3

24.3
9.6
2.4
17.3

35.7
34.0
3.5
15.0

34.4
27.2
2.4
23.0

189.3

13.2
80.9
9.7
12.8
72.7

161.6

*

11.0
4.6
1.8

9.4
-14.0
-2.6
9.0
109.5

15.5
49.2
7.9
7.4
81.8

13.2
48.6
8.7
2.0
37.0

6.2
-.2

15.3
-.2

13.2
.2

6.4

15.6

13.0

1.0
2.8
.9
1.7

2.1
4.7
7.3
1.5

6.2
3.7
.3
2.8

182.8

271.4

-14.9
2.2

-23.7
-1.9
8.5
89.1

18.6

16.6
-4.3
-3.2
9.5

-2.7
5.6
11.6

130.0

168.5

197.2

252.1

290.7

22.7
131.2
15.5
12.8
69.8

29.0
148.0
13.8
12.3
87.6

115.2

44.8
47.1
5.2
18.1
298.8
22.1

25.9
139.6
14.7
12.6
78.7

8.8
37.1
8.5
-1.0
35.8

17.5
60.2
9.0
5.1
38.2

20.7
.3

12.3
.4

10.0
.1

16.4
.2

17.5
.3

23.8
.3

7.5
.6

17.2
.2

13.8
-.8

20.4

11.9

16.2

17.2

23.5

6.9

17.0

14.6

18.5
89.9
11.0
5.2
58.2

8.5
6.6
1.9
3.3

5.0
1.6
2.4
3.0

9.9

5.7
1.6
-.8
3.4

6.8
5.9
1.4
2.2

17.6
82.7
9.9
4.0
54.3

19.5
97.1
12.1
6.4
62.2

141.1
15.8
20.7
92.5

7.4
5.4
1.5
2.9

9.7
7.9
2.4
3.6

4.4
-3.2
2.7
3.1

5.6
6.4
2.2
2.9

4.9
2.9
3.6
3.2

Financial sectors
37 Total funds raised
By instrument:
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60

U.S. government

related

Sponsored credit agency securities....
Mortgage pool securities
Loans from U.S. government
Private

financial

sectors

Corporate equities
Debt

instruments

Corporate bonds
Mortgages
Bank loans n.e.c
Open market paper and RPs
Loans from FHLBs
By sector:
Sponsored credit agencies
Mortgage pools
Private

financial

sectors

Commercial banks
Bank affiliates
Savings and loan associations
Other insurance companies
Finance companies
REITs
Open-end investment companies
Money market funds

57.6

36.4

11.7

29.2

58.8

12.4

10.9

27.9

30.5

61.5

56.2

101.5

19.9

23.1

13.5

18.6

26.3

14.2

18.2

16.3
3.6

16.6
5.8
.7

2.3
10.3
.9

3.3
15.7
-.4

12.9

19.0

25.0

27.5

4.4
23.1

40.1

9.5
17.9
-2.3
36.5

28.7

37.7

1.5

13.3

-1.9

.3

10.6

.6

13.0

3.5
-1.2
8.9
17.8
7.2

2.1
-1.3
4.6
.9
6.7

2.9
2.3
-3.6
—1
—4.0

5.8
2.1
-3.7
7.3
-2.0

57.6
16.3
3.6

36.4
17.3
5.8

11.7
3.2
10.3

37.7

13.3

14.1
2.2
6.0
.5
9.4
6.5
-1.2

-5.6
3.5
6.3
.9
6.0
.6
-.7
2.4

1.6
11.5
1.1

32.6

— 1.8

1.0

36.2

-2.5

7.0
20.5
-1.2

9.6

.6

3.1
9.2
.6

9.2

36.0

4.0
3.1
-2.9
-5.4
-1.4

6.4
1.5
-2.6
6.2
-1.5

5.2
2.7
-4.8
8.5
-2.5

10.9
3.8
9.2

27.9
4.0
14.2

-2.6

10.1
3.1
14.4
4.3

1.9
1.4
-4.3
5.1
-6.5

29.2
2.9
15.7

58.8
5.8
20.5

12.4
2.7
11.5

-1.9

10.6

32.6

-1.4
.3
-2.2
1.0
.6
-1.4
—1
r.3

7.5
-.8
*

.9
6.4
-2.4
-1.0
*

2.6
17.2
- .7
11.5

.6

-2.4

4.8
1.3
11.9
.9
16.9
-2.4
-1.0
.2

*

9.7
-.2
10.0

-2.0

.6

32.0
*

4.1
14.2

-1.8

-2.0

3.9
.9
-7.2
.9
-2.2
-1.5
.8
2.6

-6.7
-.3
2.7
1.0
3.4
-1.2
-1.0
1

2.3

.5

24.1
16.0
61.4

.7
28.0

60.3

10.1
3.3
-2.3
21.4
3.4

10.1
2.9
2.3
7.4
5.2

8.5
2.4
.4
35.0
14.1

30.5
1.8
17.2

61.5
7.1
17.9

56.2
4.4
23.1

101.5
24.1
16.0

9.7

11.5

36.5

28.7

9.0
-1.3
1
'.9
6.0
-2.1
-2.4
-.5

6.0
-.3
-.1
.9
6.9
-2.7
.4
.5

10.0
1.3
10.6
.9
17.4
-2.5
-.8
-.5

-.4
1.2
13.1
1.0
16.4
-2.2
-1.2
.9

5.8
19.6
1.0
18.7
-1.2
-.6
5.9

61.4
12.2

All sectors
61 Total funds raised, by instrument
62
Investment company shares
63
Other corporate equities
64
Debt instruments
65
U.S. government securities
66
State and local obligations
67
Corporate and foreign bonds
68
Mortgages
69
Consumer credit
70
Bank loans n.e.c
71
Open market paper and RPs
72
Other loans




261.4
-1.2
10.4

225.1
-.7
4.8

219.8
—. l
10.8

301.7
-1.0
12.9

399.4
-1.0
4.8

189.8
.8
10.3

249.8
-1.0
11.3

287.5
-2.4
15.8

316.0
.4
9.9

435.0
-1.2
7.0

472.9
-.6
1.7

252.3

221.0

209.1

363.7
-.8
2.5

289.8

395.6

178.8

239.5

274.1

305.7

362.0

429.2

471.7

70.0
29.3
30.5
121.2
35.7
28.4
27.6
19.2

98.6
29.0
41.7
146.7
34.4
35.9
11.9
31.0

99.0
29.0
31.8
137.6
44.8
50.4
43.7
35.4

28.3
14.7
13.6
79.9
23.8
51.6
21.2
19.1

34.3
16.5
23.9
60.5
10.2
38.3
14.8
22.6

98.2
15.6
36.4
57.2
9.4
-13.9
-2.4
8.7

88.1
19.0
37.2
87.1
23.6
6.4
13.3
15.3

84.3
29.2
36.1
134.0
35.0
32.2
19.8
25.1

91.5
11.1
42.1
49.4
2.2
-26.4
2.4
6.5

104.9
20.0
30.7
65.0
16.6
-1.3
-7.3
10.9

91.9
19.3
36.1
77.7
22.9
.1
13.3
12.9

84.3
18.7
38.4
96.4
24.3
12.6
13.3
17.7

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
1973

Transaction category, or sector

1 Total funds advanced in credit markets to
nonfinancial sectors

1974

1975

196.1

184.9

198.0

34.1

52.6

44.3
22.5

1976

261.7

1976

1977

1978

1977
HI

H2

HI

H2

HI

H2

HI

337.4

167.0

229.2

245.9

277.5

301.0

373.8

371.3

85.4

69.3

101.6

102.9
42.6

By public agencies and foreign:
2 Total

3
4
5
6
7
8
9
10
11

net advances

U.S. government securities
Residential mortgages
FHLB advances to S&Ls
Other loans and securities
Totals advanced, by sector
U.S. government
Sponsored credit agencies
Monetary authorities
Foreign
Agency borrowing not included in line 1 . .

51.9

36.7

49.7

59.3

9.5
8.2
7.2
9.2

11.9
14.7
6.7
19.4

16.2
-4.0
9.5

26.8
12.8
-2.0
16.9

54.5

40.2
20.4
4.3
20.5

31.2
16.8
-6.5
10.4

13.7
15.7
-1.4
8.7

24.4
11.8
-1.5
15.0

29.3
13.7
-2.5
18.8

27.2
20.0
3.4
18.6

53.2
20.9
5.2
22.4

2.8
21.4
9.2
.6
19.9

9.7
25.6
6.2
11.2
23.1

15.1
14.5
8.5
6.1
13.5

8.9
20.6
9.8
15.2
18.6

11.8
26.9
7.1
39.5
26.3

15.8
16.0
7.0
13.0
14.2

14.3
13.1
10.1
-.8
12.9

6.3
20.0
13.7
9.7
18.2

11.5
21.2
6.0
20.6
19.0

6.1
26.7
10.2
26.4
25.0

17.6
27.2
4.1
52.7
27.5

22.9
14.1
23.4
19.2
44.3
12.9
26.5
40.1

Private domestic funds advanced
12 Total

13
14
15
16
17
18

182.0

net advances

18.8
14.7
10.0
48.4
97.2
7.2

U.S. government securities
State and local obligations
Corporate and foreign bonds
Residential mortgages
Other mortgages and loans
LESS: F H L B a d v a n c e s

155.3

22.4
16.5
20.9
26.9
75.4
6.7

167.3

225.7

278.2

129.3

205.4

214.4

237.1

75.7
15.6
32.8
23.2
16.1
-4.0

61.3
19.0
30.5
52.7
60.4
-2.0

44.1
29.2
22.3
83.2
103.7
4.3

60.2
11.1
40.0
17.1
-5.7
-6.5

91.2
20.0
25.6
29.2
37.9
-1.4

67.5
19.3
28.6
45.6
51.9
-1.5

55.1
18.7
32.3
59.7
68.9
-2.5

119.9

191.2

249.6

101.2

138.7

174.4
46.6

207.9
69.4

256.8

42.8
29.3
17.2
74.9
96.0
3.4

299.7

308.5

45.4
29.0
27.3
91.6
111.5
5.2

56.4
29.0
21.7
78.0
137.4
14.1

258.0

279.8

Private financial intermediation
19 Credit market
funds advanced
financial
institutions

20
21
22
23

by

private

Commercial banking
Savings institutions
Insurance and pension funds
Other finance

2 4 Sources

165.4

86.5
36.9
23.9
18.0
165.4

of funds

25
26

Private domestic deposits
Credit market borrowing

27

Other

86.6
36.2

126.2

64.5
26.9
30.0
4.7
126.2

69.4
13.0

27.6
52.0
41.5
-1.1

58.0
71.4
51.7
10.1

85.8
84.8
62.0
16.9

14.8
49.3
38.1
-.9

40.5
54.6
44.9
-1.3

70.5
53.2
4.2

72.4
50.2
15.9

90.5
84.3
63.7
19.4

115.8
11A

69.3
17.7

191.2

249.6

101.2

138.7

174.4

207.9

241.1

258.0

90.6
-2.5

136.0
32.0

279.8

121.5
9.6

89.9
-2.4

91.3
-2.6

108.3
10.0

134.6
9.2

127.0
36.0

145.0
28.0

119.4
60.3

31.9
.9

60.1

81.6

13.7

50.0

5.1
—. 1
34.8
20.3

11.6
4.3
48.0
17.8

56.1
.1

42.5

43.8

16.8
-5.1
26.0
6.0

-1.7
29.6
3.1

52.8

42.2

44.9

44.1

60.6

19.2
5.4
1.3
18.3
8.6

17.5
9.3
4.7
2.4
8.2

23.0
8.3
8.0
-.8
6.4

19.6
6.8
2.1
4.1
11.5

24.6
9.1
1.1
9.5
16.2

38 Deposits
and currency
39
Time and savings accounts

90.6
76.1

75.7
66.7

96.8
84.8

128.8
112.2

40
41
42

18.1
29.6
28.5

18.8
26.1
21.8

-14.1
39.4
59.4

-14.4
58.1
68.5

14.4

8.9

12.0

16.6

24.2

20.8

10.5
3.9

2.6
6.3

5.8
6.2

9.3
7.3

15.9
8.3

14.3
6.5

-2.6
5.9

8.9
6.0

9.6
8.6

143.4

sources

Foreign funds
Treasury balances
Insurance and pension reserves
Other, net

81.1
85.3
60.3
14.5

119.9

5.8
-1.0
18.4
19.4

28
29
30
31

241.1

-.5
-3.8
27.4
-9.4

2.4
.4
31.7
15.6

2.3
35.8
17.2

64.1

78.2
.1

9.5
-2.5
33.8
23.4

-1.8
45.5
33.7

85.1

100.1

22.4
10.4
50.4
1.9

2.1
-.8
55.4
43.4
89.0

Private domestic nonfinancial investors
3 2 Direct

33
34
35
36
37

43

44
45

tending

in credit

markets

U.S. government securities
State and local obligations
Corporate and foreign bonds
Commercial paper
Other

Large negotiable C D s
Other at commercial banks
At savings institutions
Money

Demand deposits
Currency

46 Total of credit market instruments, deposits and currency

144.3
120.1

9.3
41.7
69.1

25.7

6.0
5.8
10.7
-1.8
4.9
96.4
75.6

-27.8
40.5
62.9

64.1

50.0

38.4

51.6

69.6

39.9
10.8
5.3
.2
7.8

25.0
7.6
2.9
4.8
9.7

14.1
6.0
1.3
3.4
13.5

14.1
8.2
.4
13.0
15.9

35.2
10.1
1.8
6.0
16.5

97.2
93.9

114.3
99.5

143.3
125.0

-.3
38.2
56.0

-19.8
52.0
67.3

-9.1
64.3
69.8

3.3

14.8

18.3

132.6
110.5
-4.4

156.0
129.7
22.9

35.8
11.6
-2.5
28.6
17.6
129.5
110.9

45.3
69.6

38.2
68.7

11.5
44.5
54.9

22.1

26.3

18.6

16.5
5.6

15.3
11.0

8.5
10.1
218.5

117.8

141.6

172.9

204.9

122.1

161.3

164.3

181.6

184.2

225.6

Public support rate (in per cent)
Private financial intermediation (in per
cent)
Total foreign funds

17.4

28.5

22.4

20.8

25.3

31.1

16.0

20.2

21.4

23.0

27.2

27.7

90.9
6.4

81.3
28.0

71.7
7.1

84.7
20.3

89.7
51.1

78.3
12.5

67.5
1.6

81.3
10.4

87.7
30.1

93.9
27.1

86.1
75.1

90.7
28.5

MEMO: Corporate equities not included
above
50 Total net issues
51
Mutual fund shares
52
Other equities
53 Acquisitions by financial institutions
54 Other net purchases

9.2
-1.2
10.4
13.3
-4.1

4.1
-.7
4.8
5.8
-1.6

10.7
—. 1
10.8
9.7
1.0

11.9
-1.0
12.9
12.5
-.7

3.8
-1.0
4.8
6.2
-2.4

11.1
.8
10.3
11.5
-.4

10.3
-1.0
11.3
7.8
2.5

13.4
-2.4
15.8
13.1
.3

10.4
.4
9.9
12.0
-1.6

1.7
-.8
2.5
6.1
-4.4

5.8
-1.2
7.0
6.3
-.5

47
48
49

NOTES BY LINE NUMBER.

1.
2.
6.
11.
12.
17.
25.
26.
28.

Line 2 of p. A-44.
Sum of lines 3-6 or 7-10.
Includes farm and commercial mortgages.
Credit market funds raised by federally sponsored credit agencies,
and net issues cf federally related mortgage pool securities. Included
below in lines 3, 13, and 33.
Line 1 less line 2 plus line 11. Also line 19 less line 26 plus line 32.
Also sum of lines 27, 32, 39, and 44.
Includes farm and commercial mortgages.
Sum of lines 39 and 44.
Excludes equity issues and investment company shares. Includes
line 18.
Foreign deposits at commercial banks, bank borrowings from foreign
branches, and liabilities of foreign banking agencies to foreign affiliates.




1.1
-.6
1.7,
1.6
-.5

29. Demand deposits at commercial banks.
30. Excludes net investment of these reserves in corporate equities.
31. Mainly retained earnings and net miscellaneous liabilities.
32. Line 12 less line 19 plus line 26.
33-37. Lines 13-17 less amounts acquired by private finance. Line 37
includes mortgages.
45. Mainly an offset to line 9.
46. Lines 32 plus 38, or line 12 less line 27 plus line 45.
47. Line 2/line 1.
48. Line 19/line 12.
49. Sum of lines 10 and 28.
50. 52. Includes issues by financial institutions.
NOTE.—Full statements for sectors and transaction types quarterly,
and annually for flows and for amounts outstanding, may be obtained
from Flow of Funds Section, Division of Research and Statistics, Board
of Governors of the Federal Reserve System, Washington, D.C. 20551.

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
1976

1975

Measure

1 Industrial production

1977

2

Products,

Final, total
Consumer goods
Equipment
Intermediate
Materials

total

July

Aug.

Sept. r

Oct.

NOV.P

129.8

137.1

143.9

144.9

146.1

147.1

147.8

148.6

149.5

119.3

129.3

137.1

143.1

144.0

145.0

146.2

146.5

146.8

147.8

127.2
136.2
114.6
137.2
130.6

134.9
143.4
123.2
145.1
136.9

140.5
147.0
131.6
152.6
145.1

141.1
147.0
133.0
154.7
146.4

142.2
147.7
134.7
155.6
147.9

143.3
148.4
136.3
156.4
148.6

143.7
149.0
136.4
157.0
149.7

143.9
149.1
136.9
158.1
151.3

144.8
149.8
137.7
159.2
152.2

116.3

129.5

137.1

144.3

145.5

146.7

147.6

148.7

149.4

150.3

73.6
73.6

80.2
80.4

82.4
81.9

83.9
84.5

84.3
85.1

84.7
85.7

85.0
85.9

85.3
86.3

85.5
87.0

85.7
87.4

118.2
124.0
110.2
123.1
115.5

Industry groupings:
Manufacturing

8

June

117.8

Market groupings:
3
4
5
6
7

May

1

Capacity utilization (per cent)
Manufacturing
Industrial materials industries

9
10

11 Construction contracts 2

162.3

190.2

253.0

332.0

249.0

286.0

289.0

300.0

319.0

285.0

12 Nonagricultural employment, total3
13
Goods-producing, total
14
Manufacturing, total
15
Manufacturing, production-worker
16
Service-producing

117.0
97.0
94.2
91.2
127.9

120.7
100.4
97.7
95.3
131.9

125.0
104.2
101.0
98.6
136.4

130.1
108.7
104.4
102.1
141.9

130.7
109.3
104.5

130.8
109.4
104.4

142.5

142.5

130.9
109.2
104.3
101.6
142.8

131.0
109.3
104.3
101.6
142.9

131.6
110.1
105.1
102.4
143.4

132.3
111.0
105.9
103.5
143.9

17 Personal income, total
18
Wages and salary disbursements
19
Manufacturing

200.4
188.5
157.3

220.4
208.2
177.1

244.0
230.1
198.6

268.4
254.6

270.6
256.9
222.3

274.4
259.2
224.9

276.3
260.0
224.5

278.4
262.0
226.4

282.0
265.9
230.2

284.8
268.6
234.1

20 Disposable personal income

199.6

217.5

239.3

21 Retail sales 5

184.6

203.5

224.4

246.3

244.9

251.7

253.5

247.5

260.5

161.2
163.4

170.5
170.3

196.7
196.0

197.8
195.3

199.3
196.9

200.9
199.7

200.6

4

220.7

102.0

101.8

267.7

265.5
245.4

6

Prices:
Consumer 7
Producer finished goods 8

22
23

r

181.5
180.6

1

195.3
194.5

r

5 Based on Bureau of Census data published in Survey of Current
Business (U.S. Dept. of Commerce)
6 Data without seasonal adjustment, as published in Monthly
Labor
Review (U.S. Dept. of Labor). Seasonally adjusted data for changes in
the price indexes may be obtained from the Bureau of Labor Statistics,
U.S. Dept. of Labor.
7 Beginning Jan. 1978, based on new index for all urban consumers.
8 Beginning with the November 1978 BULLETIN, producer price data
in this table have been changed to the BLS series for producer finished
goods. The previous data were producer prices for all commodities.

Ratios of indexes of production to indexes of capacity. Based on data
from Federal Reserve, McGraw-Hill Economics Department, and Department of Commerce.
2
Index of dollar value of total construction contracts, including
residential, nonresidential, and heavy engineering, from McGraw-Hill
Informations Systems Company, F. W. Dodge Division.
3
The establishment survey data in this table have been revised to conform to the industry definitions of the 1972 Standard Industrial Classification (SIC) Manual and to reflect employment benchmark levels for
March 1977. In addition, seasonal factors for these data have been
revised, based on experience through May 1978. Based on data in Employment and Earnings (U.S. Dept. of Labor). Series covers employees
only, excluding personnel in the Armed Forces.
4
Based on data in Survey of Current Business U.S. Dept. of Commerce). Series for disposable income is quarterly.

2.11

193.3
193.1

NOTE.—Basic data (not index numbers) for series mentioned in notes
3, 4, and 5, and indexes for series mentioned in notes 2 and 6 may also be
found in the Survey of Current Business (U.S. Dept. of Commerce).
Figures for industrial production for the last 2 months are preliminary
and estimated, respectively.

OUTPUT, CAPACITY, AND CAPACITY UTILIZATION
Seasonally adjusted
1978

1978

1978

Series
Ql

Q2

Q3 r

Q4

Output (1967 = 100)

Ql

Q2

Q3

Q4

Capacity (per cent of 1967 output)

Ql

Q2

Q3 r

Q4

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
135.4

158.2
142.1

178.5
168.5

180.2
170.2

181.9
171.8

83.8
81.1

86.3
82.7

87.8
83.5

88.6
84.2

Advanced processing

161.0
144.7

176.8
166.9

3

154.1
139.3

139.2

145.1

148.7

152.1

170.4

171.7

173.0

174.2

81.7

84.5

86.0

87.3

137.9
110.5
158.0
163.1
115.3
136.5
194.9
119.1

144.0
117.5
163.2
167.7
117.1
139.7
201.4
125.5

150.4
124.6
163.2
168.4
117.3
134.8
204.4
127.0

154.7

174.0
145.8
182.3
190.8
143.5
153.6
226.6
147.2

175.2
146.1
184.4
193.1
144.1
154.8
230.1
147.8

176.3
146.5
186.5
195.4
144.7
155.8
233.5
148.4

177.4

79.3
75.8
86.7
85.5
80.3
88.9
86.0
80.9

82.2
80.4
88.5
86.8
81.2
90.3
87.5
84.9

85.3
85.1
87.5
86.2
81.0
86.5
87.5
85.6

4 Materials
5
6
7
8
9
10
11
12

Durable goods
Basic metal
Nondurable goods
Textile, paper, and chemical
Textile
Paper
Chemical
Energy




166.2
171.1

128.6

188.5
197.5

148.9

87.2
88.2
86.6

86.4

Labor

Market

Ml

Sept.

Oct.

Nov.

Dec.

2.12 LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT
Thousands of persons; monthly data are seasonally adjusted. Exceptions noted.
1978
Category

1975

1976

1977
June

July

Aug.

Household survey data
1 Noninstitutional population 1
2 Labor force (including Armed
Forces) 1
3 Civilian labor force
Employment:
4
Nonagricultural industries 2
5
Agriculture
Unemployment:
6
Number
7

Rate

(per
force)

cent of civilian

153,449

156,048

158,559

160,928

161,148

161,348

161,570

161,829

162,033

162,250

94,793
92,613

96,917
94,773

99,534
97,401

102,671
100,573

102,734
100,618

102,672
100,550

102,993
100,870

103,184
101,062

103,764
101,647

103,975
95,855

81,403
3,380

84,188
3,297

87,302
3,244

91,346
3,473

91,038
3,387

91,221
3,360

91,457
3,411

91,811
3,380

92,470
3,265

92,468
3,387

7,830

7,288

6,855

5,754

6,193

5,968

6,002

5,870

5,912

6,012

labor

8 Not in labor force

8.5

58,655

7.7
59,130

7.0

59,025

5.7
58,257

6.2

58,414

5.9

58,677

6.0

5.8

5.8

5.9

58,577

58,645

58,269

58,275

86,163
20,286
887
4,298
4,855
19,546
4,719
16,127
15,445

'86,573
'20,436
'893
'4,341
'4,922
'19,632
'4,737
'16,169
'15,443

87,020
20,600
902
4,368
4,945
19,697
4,775
16,261
15,472

P87,270
p
20,724

Establishment survey data 4
9 Nonagricultural payroll employment 3
10
Manufacturing
11
Mining
12
Contract construction
13
Transportation and public utilities.
14
Trade
15
Finance..
16
Service
17
Government

76,945
18,323
752
3,525
4,542
17,060
4,165
13,892
14,686

79,382
18,997
779
3,576
4,582
17,755
4,271
14,551
14,871

82,256
19,647
809
3,833
4,696
18,492
4,452
15,249
15,079

1 Persons 16 years of age and over. Monthly figures, which are based
on sample data, relate to the calendar week that contains the 12th day;
annual data are averages of monthly figures. By definition, seasonality
does not exist in population figures. Based on data from Employment
and Earnings (U.S. Dept. of Labor).
2
Includes self-employed, unpaid family, and domestic service workers.
3 Data include all full- and part-time employees who worked during,
or received pay for, the pay period that includes the 12th day of the
month, and exclude proprietors, self-employed persons, domestic servants,




85,996
20,316
879
4,278
4,881
19,412
4,670
15,963
15,597

86,033
20,302
882
4,317
4,827
19,469
4,690
15,989
15,557

86,149
20,278
887
4,298
4,846
19,523
4,707
16,074
15,536

P902

p
4,413
p

4,965
^19,687
*>4,788
?16,296
p
15,495

unpaid family workers, and members of the Armed Forces. Data are
adjusted to the February 1977 benchmark. Based on data from Employment and Earnings (U.S. Dept of Labor).
4
The establishment survey data in this table have been revised to
conform to the industry definitions of the 1972 Standard Industrial
Classification (SIC) Manual and to reflect employment benchmark
levels for March 1977. In addition, seasonal factors for these data have
been revised, based on experience through May 1978.

A48

Domestic Nonfinancial Statistics • January 1979

2.13 INDUSTRIAL PRODUCTION Indexes and Gross Value
Monthly data are seasonally adjusted.

Grouping

1967
proportion

1977
1977
average

Oct.

Nov.

1978
Dec.

May

June

July

Aug.

Sept. r

Oct.

NOV.P Dec.®

147.1

Index (1967 = 100)
MAJOR M A R K E T
1 Total index
2 Products
3
Final products
4
Consumer goods
5
Equipment
6
Intermediate products
7 Materials
8
9
10
11
12

Consumer goods
Durable consumer goods
Automotive products
Autos and utility vehicles
Autos
Auto parts and allied goods

100.00

137.1

138.9

139.3

139.7

147.8

148.6

149.5

150.4

60.71
47.82
27.68
20.14
12.89
39.29

137.1
134.9
143.4
123.2
145.1
136.9

138.9
136.5
144.9
125.0
147.8
138.9

139.5
137.0
145.2
125.8
148.4
139.0

140.3 143.1
137.6 140.5
145.8 147.0
126.2 131.6
150.4 152.6
138.8 145.1

144.0 145.0
141.1 142.2
147.0 147.7
133.0 134.7
154.7 155.6
146.4 147.9

146.2 146.5
143.3 143.7
148.4 149.0
136.3 136.4
156.4 157.0
148.6 149.7

146.8
143.9
149.1
136.9
158.1
151.3

147.8
144.8
149.8
137.7
159.2
152.2

148.8
145.6
150.5
138.8
160.5
152.9

7.89
2.83
2.03
1.90
.80

153.1 156.8
174.2 179.4
169.2 176.1
148.4 154.3
186.8 187.6

155.2
173.6
167.6
147.5
188.9

155
172.4
165.5
143.6
190.4

160.2
180.0
175.6
151.6
191.5

160.6
179.9
173.4
149.8
193.9

160.9
182.2
176.7
152.7
196.1

161.5
182.1
175.6
151.1
198.0

160.3
178.3
170.0
144.4
199.8

162.0
186.2
181.3
155.0
199.1

162.6 162.8
189.6 186.3
185.7 180.9
159.8 151.9
199.5 2 0 0 . 0

141.3
127.3
130.5
152.2
144.3

144.2 145.0
128.6 131.4
131.6 133.0
160.5 160.0
145.8 146.3

146.6
132.8
134.6
161.5
147.7

148.9
138.3
140.7
163.4
148.8

149.7
139.0
141.0
166.0
148.

148.9
133.7
136.8
168.5
149.1

150.0
133.9
135.6
167.9
151.3

150.2
134.4
136.9
169.0
150.8

148.5
128.7
129.9
169.3
150.6

147.6
124.1
125.2
169.4
151.4

139.6 140.1 141.2
125.2 128.0 126.4
143.6 143.5 145.3
135.5 135.2 136.7

141.8
126.9
145.9
137.9

141.7
125.4
146.2
139.9

141.6 142.4
124.8 125.1
146.3 147.3
139.0 140.2

143.1
126.6
147.8
140.8

144.4
128.9
148.8
141.2

144.0 144.8 145.5
128.3
148.3 * 148^9 149.9
140.0 140.9

152.9
180.5
117. 1
151.4
159.0

155.1
186.9
118.5
149.9
155.6

155.2
186.5
119.
149.7
158.5

153.4
182.0
117.9
150.7
157.2

154
185.5
118.0
150.8
159.0

155.5
186.7
117.5
151.9
159.9

155.9
188.0
117.3
152.0
160.1

157.4
190.1
118.2
153.3
160.9

158.0
191.9
117.0
154.0

12.63 149.2 152.6 153.5
6.77 138.5 141.8 142.6
1.44 202.5 205.7 206.7
3.85 113.9 118.5 118.7
1.47 140.2 139.8 142.1

154.0
143.0
208.3
118.2
143.7

160.2 161.8 163.8
149.7 150.9 151.9
226.0 227.3 228.9
121.3 122.8 122.6
149.2 149.2 152.8

165.4
152.8
228.1
123.9
154.6

165.8 166.9 167.9 169.3
152.7 153.2 152.9 153.4
226.3 227.1 225.0 2 2 4 . 2
124.4 125.3 125.1 126.0
154.8 154.0 154.4 155.7

13
14
15
16
17

Home goods
Appliances, A/C, and TV
Appliances and TV
Carpeting and furniture
Miscellaneous home goods

5.06
1.40
1.33
1.07
2.59

18
19
20
21

Nondurable consumer goods
Clothing
Consumer staples
Consumer foods and tobacco

19.79
4.29
15.50
8.33

22
23
24
25
26

Nonfood staples
Consumer chemical products
Consumer paper products
Consumer energy products
Residential utilities

27
28
29
30
31

Equipment
Business equipment
Industrial equipment
Building and mining e q u i p m e n t . . . .
Manufacturing equipment
Power equipment

32
33
34
35

Commercial transit, farm equipment..
Commercial equipment
Transit equipment
Farm equipment

36

Defense and space equipment

7.17
2.63
1.92
2.62
1.45

153.4
183.7
117.6
149.1
155.8

5.86
3.26
1.93
.67

161.6
191.6
117.8
142.3

165.1
195.4
123.3
142.1

165.9
197.4
118.9
147.8

143.9

144.9

146.1

166.9 172.3 174.4 177.5
198.8 204.2 206.9 210.6
132.2 132.3 134.9
121
144.5 131.9 137.3 138.5

158.4
192.5
117.3
154.7

149.6
127.9
152.9

159.4

179.9 180.8 182.7 185.3 187.8
212.2 214.1 215.1 216.8 219.3
138.5 138.6 142.3 146.1 149.5
141.3 142.0 142.2 143.9

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
38
Business supplies
39
Commercial energy products

6.42
6.47
1.14

140.8
149.5
164.6

144.9
150.5
163.0

146.5
150.1
160.9

148.3
152.6
165.6

150.4
155.0
162.7

152.1
157.0
163.0

153.5
157.6
164.1

154.7
158.2
167.4

155.6
158.4
169.9

156.6
159.6
170.5

157.7
160.7
171.0

159.1

Materials
Durable goods materials
Durable consumer parts
Equipment parts
Durable materials n.e.c
Basic metal materials

20.35
4.58
5.44
10.34
5.57

134.5
132.0
143.1
131.1
110.9

137.1
135.4
147.6
132.4
110.0

137.2
136.5
147.2
132.3
107.9

138.7
135.7
149.2
134.3
110.3

143.9
137.9
155.8
140.3
117.5

145.4 148.7
138.7 142.0
157.4 161.7
141.8 144.7
118.2 121.7

150.4
142.2
162.9
147.6
125.4

152.1
144.8
164.6
148.7
126.7

153.7 154.6
147.3 147.3
166.0 167.3
150.1 151.1
128.0 129.0

155.8
148.3
168.9
152.2

10.47
7.62
1.85
1.62
4.15

153.5 154.4 155.4 155.3 163.5 164.1 162.5
158.3 160.0 159.3 159.3 167.9 168.
168.3
113.0 118.5 117.8 117.3 116.7 118.0 117. 1
133.5 134.4 132.2 130.2 140.1 139.9 135.1
188.2 188.5 188.6 189.5 201.7 202.9 2 0 4 . 0

162.7 164.4 165.4 166.5
167.0 170.0 170.5 171.4
116.0 118.7 118.7 118.6
131.5 137.7 137.3 137.3
203.7 205.5 206.7 208.2

166.8
171.4

40
41
42
43
44
45
46
47
48
49

Nondurable goods materials
Textile, paper, and chemical materials
Textile materials
Paper materials
Chemical materials

50
51
52
53
54

Containers, nondurable
Nondurable materials n.e.c
Energy materials
Primary energy
Converted fuel materials

55
56
57
58

Supplementary groups
Home goods and clothing
Energy, total
Products
Materials
For NOTE see opposite page.




1.70
1.14
8.48
4.65
3.82

150.9
125.3
122.4
107.3
140.7

148.9
125.4
124.0
112.2
138.4

156.7
128.5
123.0
111.6
136.9

154.4
129.9
118.7
103.0
137.7

161.9
135.8
125.2
114.4
138.6

162.
135.0
127.5
116.
141.4

155.4
135.7
127.9
116.7
141.6

161.8
134.8
127.0
115.4
141.3

161.1
131.8
126.0
111.8
143.4

163.4
134.3
128.1
116.1
142.7

165.6
135.7
128.6
117.0
142.7

9.35
12.23
3.76
8.48

133.9
132.5
155.4
122.4

136.
133.0
153.3
124.0

136.5
132.3
153.2
123.0

137.5
129.7
154.5
118.7

138.2
134.2
154.3
125.2

138.3
135.9
154.6
127.5

138.0
136.4
155.6
127.9

139.2
136.1
156.7
127.0

140.3
135.9
158.3
126.0

139.1
137.6
159.0
128.1

139.2
138.1
159.7
128.6

129.2

140.6
138.8
i29.2

Output

2.13

A49

Continued

Grouping

SIC
code

1967
proportion

1978

1977
1977
average

Oct.

Nov.

Dec.

May

June

July

Aug.

Sept. r

Oct.

e
NOV.p D e c .

Index (1967 = 100)
MAJOR I N D U S T R Y
1 Mining

2
3
4

and

5

Manufacturing.,

6
7

Nondurable..
Durable

8
9
10
11

Mining
Metal mining
Coal
Oil and gas extraction
Stone and earth minerals.

12
13
14
15
16

Nondurable manufactures
Foods
Tobacco products
Textile mill products . . .
Apparel products
Paper and products

17
18
19
20
21
22
23
24
25

136.2

135.8

135.5

133.9

140.9

142.5

142.6

142.5

142.1

144.1

144.2

144.7

117.8
156.5
175.5

119.6
154.0
173.6

118.8
154.2
173.3

113.4
156.7
175.9

126.7
157.0
177.1

128.0
158.6
180.1

127.1
159.9
182.1

126.0
160.8
183.2

124.1
162.3
184.4

127.1
162.4

127.9
162.6

128.0
163.3

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

35.97
51.98

148.1
129.5

149.6
132.4

150.1
132.7

150.9
133.4

154.0
137.6

154.9
139.0

155.0
141.1

155.6
142.2

157.1
142.8

157.5
143.9

158.1
145.0

158.9
145.9

10
11, 12
13
14

.51
.69
4.40
.75

105.4
118.0
118.0
124.9

80.0
141.4
119.4
128.1

84.8
140.6
117.8
127.2

104.3
74.6
118.4
126.5

120.0
131.7
126.3
130.1

121.1
136.4
127.1
130.7

117.0
131.7
126.8
131.3

117.9
124.9
126.2
131.6

115.6
114.7
124.9
133.8

122.1
144.0
124.7
134.0

125.3
145.6
124.5
133.3

147.2
124.2

20
21
22
23
26

8.75
.67
2.68
3.31
3.21

137.9
114.3
137.1
124.2
137.4

137.3
113.8
142.4
129.0
137.9

139.4
117.5
141.6
125.1
137.8

140.4
120.6
143.7
125.8
138.6

142.8
120.2
138.5
125.8
146.6

141.8
122.7
140.4
126.8
148.0

142.9
120.8
141.0
124.5
140.5

144.0
118.6
139.5
127.2
141.9

144.4
120.6
142.2
130.9
142.3

143.5
119.0
142.1
130.6
145.8

144.1

U5.3

146.2

27
28
29
30
31

4 . 7 2 124.9 125.7 126.2 127.5 128.2 128.7
7 . 7 4 180.7 182.3 183.1 183.0 188.1 191.1
1.79 141.0 141.4 140.5 139.3 143.4 142.8
2 . 2 4 232.2 236.3 238.5 240.1 252.7 255.5
.86
75.3
78.1
75.7
77.0
77.3
75.1

130.3 129.5 131.0 130.3
192.3 192.2 194.2 195.8
144.3 144.1 147.1 146.7
259.1 261.1 263.1 264.1
74.0
74.5
74.1
73.8

131.9
196.8
147.2
263.7
74.5

132.9

12.05

utilities.

6.36
5.69
3.88

Mining
Utilities
Electric

Printing and publishing
Chemicals and p r o d u c t s . . .
Petroleum products
Rubber & plastic products.
Leather and products
Durable manufactures
Ordnance, private & government.
Lumber and products
Furniture and fixtures
Clay, glass, stone products

i43.0

i49!6

19,91
24
25
32

3.64
1.64
1.37
2.74

73.9
133.4
140.9
146.1

74.4
135.7
146.6
148.0

74.1
137.5
146.0
152.8

73.8
138.1
146.6
152.1

74.3
136.5
152.8
157.9

74.7
138.7
156.2
159.8

75.2
138.1
158.1
158.8

75.2
136.9
159.0
159.5

74.3
139.2
160.7
160.9

73.9
140.2
161.3
162.1

73.6
141.6
161.2
164.1

73.8

26
27
28
29
30

Primary metals
Tron and steel
Fabricated metal products.
Nonelectrical machinery.. .
Electrical machinery

33
331, 2
34
35
36

6.57
4.21
5.93
9.15
8.05

110.2
103.4
130.9
144.8
141.9

113.5
107.7
133.8
148.9
144.2

111.2
104.3
135.8
149.7
146.0

111.0
103.8
136.4
151.7
147.3

115.5
110.5
140.4
152.9
152.9

117.5
114.5
142.3
154.6
154.1

123.0
119.0
144.0
156.1
157.9

126.0
120.9
145.8
157.3
156.9

127.9
123.2
146.3
158.7
158.3

128.4
123.8
146.3
159.8
157.9

128.9
123.9
146.8
160.7
159.2

129.3

31
32
33
34
35

Transportation equipment
Motor vehicles & parts
Aerospace & misc. trans, eq.,
Instruments
Miscellaneous mfrs

37
371
372-9
38
39

9.27
4.50
4.77
2.11
1.51

121.1
159.7
84.7
159.1
149.1

124.3
168.4
82.8
162.2
151.0

122.0
163.0
83.3
163.1
151.8

122.2
161.8
84.9
164.7
152.5

130.1
168.3
93.9
169.8
152.7

130.4
167.7
95.0
170.9
153.5

132.1
169.7
96.5
172.2
153.2

133.4
171.0
98.3
175.4
153.8

132.8
168.9
98.9
174.6
154.1

136.9
177.1
99.2
175.3
153.9

139.3
181.3
99.8
177.2
153.9

138.6
178.5
101.1
180.1
155.5

147.9
162.2
160.9

Gross value (billions of 1972 dollars, annual rates)
MAJOR MARKET
36 Products, total.
Final
37
" • products
Consumer goods.
38
Equipment
39

1507.4 583.9
U 9 0 . 9 452.1
1277.5 317.5
U 1 3 . 4 134.6

40

U16.6

Intermediate products.

131.9

591.3

591.3

594.7

606.8

608.9

610.3

613.3

613.6

621.9

625.8

457.8

457.3

458.7

468.2

468.9

469.6

472.2

471.8

478.3

482.0

319.5
138.1

320.0
137.3

320.4
138.2

324.0
144.2

323.0
146.0

323.4
146.4

324.7
147.5

324.4
147.7

327.8
150.6

330.8
151.4

133.8

134.1

135.9

138.6

140.3

140.7

141.4

141.9

143.5

143.9

i 1972 dollars.
NOTE.—Published groupings include some series and subtotals not




shown separately. For description and historical data, see Industrial
Production—1976 Revision (Board of Governors of the Federal Reserve
System: Washington, D.C.), Dec. 1977.

A50

Domestic Nonfinancial Statistics • January 1979

2.14 HOUSING AND CONSTRUCTION
Monthly figures are at seasonally adjusted annual rates except as noted.
1978
1975

Item

1976

1977
June

May

July'

Aug.

Sept.'

Oct.'

Nov.

Private residential real estate activity
(thousands of units)
NEW UNITS
1 Permits

2
3

927

authorized

669
278

1-family
2-or-more-family

A Started

5
6

1,160

1-family
2-or-more-family

7 Under construction,

8
9

892
268
end of

period

1,003

1-family
2-or-more-family

531
All

10 Completed

11
12

1,297

1-family
2-or-more-family

13 Mobile homes shipped
Merchant builder activity in
1-family units:
Number sold
Number for sale, end of 2period 1 .
Price (thous. of dollars)
Median:
Units sold
Units for sale
Average:
Units sold

14
15
16
17
18

1,296

894
402

18,133

1,597

1,821

1,632

12,265
5,861

1,123
698

1,563

1,731

1,058
539

1,035
597

1,719

1,691

1,020
543

1,092
639

1,127
592

1,114
577

1,538

1,986

2,054

2,124

2,119

1,163
377

1,451
535

1,441
683

2,025

2,075

1,478
576

2,095

1,453
666

1,463
612

2,104

1,440
585

1,459
636

1,498
606

1,147

1,442

1,282

1,296
11A

1,298
119

1,308

1,326

655
492

829
613

770
513

522

'

1,298

786
'513

520

784
524

785
540

1,362

1,652

1,854

1,890

1,943

866
430

1,254
398

'

1,426
428

1,344
546

1,971

1,026
336

1,842

1,289
654

'1,364
603

1,447
524

1,397
445

213

246

111

258

263

232

283

111

300

304

544
383

639
433

819
407

846
412

831
418

789
418

'785
'419

793
420

975
411

811
418

39.3
38.9

44.2
41.6

48.9
48.2

55.7

56.7

54.8

'56.1

57.5

58.5

58.7

42.5

48.1

54.4

62.3

63.2

62.9

63.0

64.8

66.1

66.4

2,452

3,002

3,572

3,770

3,780

3,890

4,080

3,950

4,290

4,350

35.3
39.0

38.1
42.2

42.9
47.9

47.8
54.8

48.4
55.1

49.4
56.5

50.3
57.5

50.2
57.7

50.1
57.3

50.7
57.4

1,967

EXISTING UNITS (1-family)
19 Number sold
Price of units sold
(thous. of
dollars): 2
20
Median
21
Average

Value of new construction
(millions of dollars)

4

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

'110,416

'134,723

'156,188

'161,064

161,804

'160,562

161,258

161,935

165,477

2 3 Private

r

24
25

46,472
'47,178

60,519
'49,897

'80,957
'53,766

'94,275
'61,913

'95,357
'65,707

95,888
65,916

'95,011
'65,551

94,249
67,009

93,594
68,341

95,784
69,693

8,017
12,804
5,585
10,112

7,182
12,757
6,155
'23,803

'7,713
'14,789
'6,200
'25,064

8,735
18,546
6,935
'27,697

11,335
19,246
6,761
'28,365

11,170
19,463
7,036
28,247

12,043
18,835
6,721
'27,952

12,634
18,926
6,686
28,763

12,627
19,410
6,667
29,637

12,667
19,938
6,774
30,314

'40,883

'38,312

'37,828

'1,391
'10,548
3,256
'25,688

45,099

45,249

'1,521
'9,439
'3,751
'23,601

'1,517
'9,280
'3,882
'23,149

48,388

1,446
10,556
4,172
28,925

'

1,358
10,338
3,508
30,045

47,970

47,939

1,493
9,833
4,989
32,073

47,303

1,615
10,862
5,660
29,833

1,449
11,428
3,851
31,211

Residential
Nonresidential, total
Buildings:
Industrial
Commercial
Other
Public utilities and other

26
27
28
29

30 Public

31
32
33
34

Military
Highway
Conservation and development...
Other 3
1

93,650

r

Not at annual rates.
Not seasonally ad justed.
3 Beginning Jan. 1977 Highway imputations are included in Other.
4
Value of new construction data in recent periods may not be strictly
comparable with data in prior periods due to changes by the Bureau of
the Census in its estimating techniques. For a description of these changes
see Construction Reports (C-30-76-5), issued by the Bureau in July 1976.
2




43,162

'1,520
11,427
5,231
29,984

1,434

NOTE.—Census Bureau estimates for all series except (a) mobile
homes, which are private, domestic shipments as reported by the Manufactured Housing Institute and seasonally adjusted by the Census Bureau,
and (b) sales and prices of existing units, which are published by the
National Association of Realtors. All back and current figures are available from originating agency. Permit authorizations are for 14,000
jurisdictions reporting to the Census Bureau.

Prices

A51

2.15 CONSUMER AND PRODUCER PRICES
Percentage changes based on seasonally adjusted data, except as noted.
12 months to—
Item

3 months (at annual rate) to—
1977

1977
Nov.

1 month to—
1978

1978

1978
Nov.
Dec.

Mar.

June

Sept.

July

Aug.

Sept.

Oct.

Nov.

Index
level
Nov.
1978
(1967
= 100)2

Consumer prices 3
1 All items

6.7

9.0

4.9

9.3

11.4

7.8

.5

.6

.8

.8

.5

2 Commodities
Food
3
4
Commodities less food
Durable
5
6
Nondurable

6.1

8.4

4.9

9.3

11.2

6.3

.4

.4

192.9

11.3
7.3
8.8
5.3

4.2
5.4
5.2
5.1

16.4
6.1
8.7
3.1

20.4
7.2
9.0
5.5

3.0
7.8
8.3
7.3

.0
.6
.7
.5

.3
.5
.5
.5

.7
.8
.7
.8
.5

.6

8.0
4.9
4.7
5.1

.7
.5
.9
.9
.8

.3
.8
.8
.6

217.8
180.3
180.0
179.1

7 Services
8
Rent
9
Services less rent

7.8

9.6

4.9

10.3

.8

.8

.8

218.6

6.3
4.8

8.5
12.2

7.5
10.8

.5
.9

.5
.9

.8
.9

.8
.6

.4

7.3
9.9

9.1
6.2
9.6

11.8

6.4
8.0

.8

.7
.3

168.5
227.8

6.4
6.1
8.6

8.4
8.6
12.9

5.0
5.3
7.1

8.1
8.0
12.2

9.3
9.9
14.5

9.1
8.3
14.7

.7
.7
1.2

.7
.6
1.0

.8
.7
1.3

.8
.8
1.2

..6
.6
.7

197.8
195.3
238.8

10
11
12

Other groupings:
All items less food
All items less food and energy
Homeownership

202.0

Producer prices, formerly Wholesale prices
13 Finished goods
14
15
16
17

Consumer
Foods
Excluding foods
Capital Equiptment

18 Materials
19
Intermediate!
Crude:
20
Nonfood
21
Food

7.1

8.7

7.2




11.4

5.0

r

.9

.8

200.6

6.9
8.3
6.2
7.4

9.0
11.2
7.8
7.9

5.4
7.4
4.7
10.9

10.9
21.2
5.3
7.1

12.5
14.6
11.2
8.7

4.2
-1.0
7.6
r
6.4

.5
-.5
10
.6

— .2
-1.4
r
.5
.4

.S
1.7
r
.4
r
.5

1.0
1.7
.6
.6

.7
.6
.7
1.0

198.3
212.0
189.5
205.9

5.5
6.4

10.1
8.1

8.3
4.2

13.9
9.2

9.0
6.6

5.2
6.7

.2
.4

1
.6

.9
.6

1.6
1.1

.9
.8

226.5
222.7

1.9
3.7

16.6
19.3

20.1
27.6

16.2
40.3

11.6
28.1

12.2
-9.4

2.4
-2.5

1.0
1.9

2.1
3.6

1.8
1.3

300.6
221.3

1 Excludes intermediate materials for food manufacturing and manufactured animal feeds.
2 Not seasonally adjusted.

9.6

.5

.O

r

-.5
-1.8

r

3
Beginning Jan. 1978 figures for consumer prices are those for all urban
consumers.

SOURCE.—Bureau of Labor Statistics.

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.

1975

1976

1977

1977

1978

Account
Q2

Q3

Q4

Q1

Q2

Q3 r

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

1,090.2

1,206.5

1,188.6

1,214.5

1,255.2

1,276.7

1,322.9

1,356.9

By source:
Personal

2

3
4
5

consumption

expenditures

979.1

Durable goods
Nondurable goods
Services

6

Gross private

7

domestic

investment

Fixed investment

8

Nonresidential

9
10
11
12

Structures
Producers'durable equipment
Residential structures
Nonfarm

13
14

Change in business inventories
Nonfarm

15

Net exports

16
17

Exports
Imports

18

Government

19
20

of goods

and services

purchases

of goods

and

services

By major type of product:
Final sales, total
Goods

23
24
25
26

Durable
Nondurable
Services
Structures
Change in business inventories
Durable goods
Nondurable goods

30

MEMO: Total GNP in 1972 dollars

178.4
479.0
549.2

175.6
473.6
539.4

177.4
479.7
557.5

187.2
496.9
571.1

183.5
501.4
591.8

313.5

322.7

197.8
519.3
605.8

190.9

243.0

297.8

201.6

232.8

295.6

309.7

282.3

278.6

287.8

300.5

150.2

164.6

306.0

190.4

325.3

53.8
96.4
51.5
49.5

57.3
107.3
68.2
65.8

187.2

193.5

200.3

63.9
126.5
91.9
88.9

63.4
123.8
91.4
88.4

205.6

65.4
128.1
94.3
91.2

220.1

67.4
132.8
100.2
97.5

68.5
137.1
100.3
97.3

76.6
143.5
105.3
102.1

-10.7
-14.3

10.2
12.2

15.6
15.0

17.0
16.5

21.9
22.0

13.1
10.4

16.7
16.9

20.1
22.1

186.6

-5.9
178.1
184.0

180.8
187.8

126.9

22

27
28
29

156.6
442.6
491.0

20.4
147.3

Federal
State and local

21

132.6
408.9
437.5

7.4

163.2
155.7

-11.1
175.5

-7.0

-23.2

172.1
195.2

-24.1

181.7
205.8

345.4

-5.5

205.4
210.9

338.4

359.5

394.0

123.1
215.4

388.8

129.9
229.6

399.5

412.5

145.1
248.9

416.7

142.9
245.9

146.8
252.7

424.7

152.2
260.3

151.5
265.2

147.2
277.6

1,539.6

199.5
531.7
625.8
350.1

336.5
227.5

80.9
146.6
109.0
105.7
13.6
14.6
-10.7

210.1
220.8
439.8

154.0
285.8

1,689.9

1,871.6

1,850.0

1,894.9

1,945.0

1,975.3

2,067.4

686.6

760.3

2,122.5

832.6

825.8

259.0
427.5
697.6
144.7

341.3
491.3
862.8
191.8

844.7

859.6

304.6
455.7
778.0
161.9

861.8

339.1
486.7
850.0
191.3

912.2

346.5
498.2
875.3
196.8

347.4
512.2
893.6
204.9

927.3

351.2
510.6
926.4
203.8

375.8
536.4
952.0
223.4

380.1
547.2
973.7
235.0

-10.7
-8.9
-1.8

10.2
5.3
4.9

15.6
8.4
7.2

17.0
9.1
7.6

21.9
11.9
10.0

13.1
6.3
6.8

16.7
14.8
1.9

20.1
10.8
9.3

13.6
10.2
3.4

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

1,728.4

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

32 Compensation of employees

931.1

33

1,036.8

1,153.4

1,140.5

1,165.8

1,199.7

1,241.0

805.9

890.1

983.6

1,287.8

1,317.1

993.6

1,021.2

187.6
702.5

200.8
782.9

973.4

175.4
630.4

198.1
775.3

201.7
791.9

208.1
813.1

1,050.8
211.4

1,090.2

1,113.4

125.2

146.7

169.8

167.1

172.2

178.4

Wages

34
35

and salaries

Government and Government enterprises
Other

36

Supplement

37

to wages

and salaries

Employer contributions for social
insurance
Other labor income

38

3 9 Proprietors'

1

income

Business
and professional 1
Farm 1

40
41

42 Rental income of persons

2

43 Corporate profits 1
44
Profits before tax 3
45
Inventory valuation adjustment
46
Capital consumption adjustment
47 Net interest

60.1
65.1

69.7
77.0




78.6
88.5

79.9
92.2

98.9

97.2

78.9
20.0

80.8
16.5

87.0

88.6

99.8

63.5
23.5

70.2
18.4

79.5
20.3

82.4
96.1
107.3

82.3
25.1

216.8
896.6

190.2

197.6

203.6

90.2
100.0

93.6
104.0

95.7
107.9

105.0

110.1

114.5

83.1
21.9

89.6
25.0

86.1
24.0

22.4

22.5

22.5

22.4

22.4

22.7

22.8

22.2

24.3

95.9
120.4
-12.4
-12.0

127.0
155.9
-14.5
-14.4

144.2
173.9
-14.8
-14.9

143.7
175.1
-16.6
-14.8

154.8
177.5
-7.7
-15.0

148.2
178.3
-14.8
-15.3

132.6
172,1
-23.5
-16.1

163.4
205.5
-24.9
-17.2

165.2
205.4
-20.9
-19.3

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.
With capital consumption adjustments.

2

79.4
90.4

839.3

213.9
876.3

3 For after-tax profits, dividends, etc., see Table 1.50.
SOURCE.—Survey of Current

Business

(U.S. Dept. of Commerce).

National Income Accounts

A53

2.17 PERSONAL INCOME AND SAVING
Billions of current dollars; quarterly data are at seasonally adjusted annual rates. Exceptions noted.
1978

1977
1975

1976

1977

Account

Q2

Q3

Q4

Ql

Q2

Q3 r

Personal income and saving
1,593.0

1,628.9

1,682.4

1,731.7

1,021.2

1,050.8

1,090.2

1,113.2

1,255.5

1,380.9

1,529.0

1,508.6

1,543.7

805.9

890.1

983.6

973.4

993.6

275.0
211.0
195.3
160.1
175.4

307.5
237.5
216.4
178.6
187.6

343.7
266.3
239.1
200.1
200.8

342.0
264.1
236.5
196.8
198.1

348.3
269.3
241.2
202.3
201.7

65.1

77.0

90.4

88.5

92.2

87.0

88.6

99.8

98.9

97.2

63.5
23.5

70.2
18.4

79.5
20.3

78.9
20.0

80.8
16.5

12 Rental income of persons 2

22.4

22.5

22.5

22.4

22.4

22.7

13 Dividends

31.9

37.9

43.7

42.7

44.1

46.3

14 Personal interest income

115.5

126.3

141.2

139.1

143.6

146.0

15 Transfer payments
16
Old-age survivors, disability, and health
insurance benefits

178.2

193.9

208.8

204.0

211.9

81.4

92.9

105.0

101.8

108.5

50.5

55.5

61.0

60.5

61.4

62.6

67.2

69.2

70.5

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

168.8

196.5

226.0

223.3

224.6

233.3

237.3

249.1

263.2

1,391.6

1,433.3

1,468.4

3

Commodity-producing industries

5
6
7

Distributive industries
Service industries
Government and government enterprises

8 Other labor income
9 Proprietors'

income1

Business
and professional 1
Farm 1

10
11

17

LESS: Personal contributions for social
Insurance

18 EQUALS: Personal income
19

LESS: Personal tax and nontax p a y m e n t s . . . .

357.1
277.3
247.5
208.5
208.1
96.1
107.3

365.9
286.9
257.0
216.5
211.4

387.0
296.1
266.4
222.8
213.9

396.4
302.0
271.6
228.5
216.7

100.0

104.0

107.9

105.0

110.1

114.5

86.1
24.0

89.6
25.0

22.8

22.2

24.3

47.0

48.1

50.1

151.4

156.3

161.7

215.9

219.2

220.6

230.4

110.1

112.1

113.7

121.1

82.3
25.1

83.1
21.9

20 EQUALS: Disposable personal income

1,086.7

1,184.4

1,303.0

1,285.3

1,319.1

1,359.6

21

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

73.7

82.4

76.3

76.0

6,226
4,030
4,365
5.4

6,215
4,009
4,370
5.9

6,334
4,060
4,399
5.3

6,359
4,091
4,428
5.2

LESS: Personal outlays

22 EQUALS: Personal saving

83.6

68.0

66.9

67.5

74.3

5,629
3,626
4,025
7.7

5,906
3,808
4,136
5.7

6,144
3,954
4,271
5.1

6,120
3,922
4,241
5.3

6,191
3,953
4,293
5.6

MEMO ITEMS :

Per capita (1972 dollars):
24
Personal consumption expenditures
25
Disposable personal income
26 Saving rate (per cent)

r

Gross saving
27 Gross private saving
28
29
30

Personal saving
Undistributed corporate profits 1
Corporate inventory valuation adjustment....

31
32

Capital consumption allowances:
Corporate
Noncorporate

3 4 Government

35
36

surplus,

or deficit

(—),

259.8

270.7

290.8

288.6

310.7

304.3

305.4

319.9

325.7

83.6
14.2
-12.4

68.0
24.8
-14.5

66.9
28.7
-14.8

67.5
28.7
-16.6

74.3
38.0
-7.7

73.7
28.0
-14.8

82.4
15.6
-23.5

76.3
30.3
-24.9

76.0
29.0
-20.9

101.3
60.7

111.5
66.3

120.9
74.3

119.8
72.6

122.6
75.9

124.6
77.9

127.4
79.9

130.5
82.8

134.7
86.1

national

Federal
State and local

-64.4

-33.2

-18.6

-11.8

-25.2

-29.6

-21.1

-70.6
6.2

-53.8
20.7

-48.1
29.6

-40.3
28.5

-56.4
31.2

-58.6
29.0

-52.6
31.5

.6

6.2

-23.6
29.8

-22.8
23.4

37 Capital grants received by the United States,
net.
3 8 Investment

202.8

241.7

276.9

280.4

292.6

279.5

286.4

326.6

326.6

39
40

190.9
11.9

243.0
-1.2

297.8
-20.9

295.6
-15.2

309.7
-17.1

313.5
-34.1

322.7
-36.3

345.4
-18.9

350.1
-23.5

7.4

4.2

4.7

3.7

7.1

4.8

2.2

.5

.4

Gross private domestic
Net foreign

41 Statistical discrepancy

1 With inventory valuation and capital consumption adjustments.
With capital consumption adjustment.

2




SOURCE.—Survey of Current

Business

(U.S. Dept. of Commerce).

A54

International Statistics • January 1979

3.10 U.S. INTERNATIONAL TRANSACTIONS

Summary

Millions of dollars; quarterly data are seasonally adjusted except as noted, i
1978

1977
1975

Item credits or debits

1976

1977

Ql

Q4

Q3

Q2 '

1 Merchandise exports
2 Merchandise imports
3
Merchandise trade balance 2 .

107,088
98,041
9,047

114,694
124,047
-9,353

'120,576
r
151,706
-31,130

'31,009
'38,277
'-7,268

'29,461
'39,664
-10,203

30,664
41,865
-11,201

35,067
42,869
-7,802

4 Military transactions, net
5 Investment income, net 3
6 Other service transactions, net.

-876
12,795
2,095

312
15,933
2,469

1,334
17,507
1,705

467
4,609
583

5
3,813
482

210
4,877
538

592
4,583
842

7 Balance on goods and services 3 , 4
8 Remittances, pensions, and other transfers...
9 U.S. government grants (excluding military).
10 Balance on current account 3 .
11

Not seasonally

14
15
16
17

9,361

-10,585

'-1,609

'-5,903

-5,576

-1,785

-1,878
-3,145

-1,932
-2,776

-490
-787

-473
-591

-504
-778

-536
-781

18,445

4,339

-15,292

'-2,886
'-5,796

'-6,967
'-5,245

-6,858
-6,382

-3,102
-2,656

-3,470

-4,213

-3,679

-1,098

-838

-896

-1,176

151

-78

-231
-118
-121

adjusted*..

12 Change in U.S. government assets, other than official
reserve assets, net (increase, —)
13 Change

23,060

-1,721
-2,894

in U.S. official

reserve

assets

(increase,

-607

—)

Gold
Special Drawing Rights (SDRs)
Reserve position in International Monetary Fund (IMF).,
Foreign currencies

-2,530

246

329

-60

-29
42
47

-16
-62

-104
437
-4

-466
-75

-2,212
-240

-294
302

-9
133
27

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

-1,184

267

21
22
23
24

Long-term
Short-term
U.S. purchase of foreign securities, net.
U.S. direct investments abroad, n e t 3 . . .

2 5 Change
in foreign
(increase,
+)

26
27
28
29
30

-1,357

claims

official

-66

assets

in the

United

-366
-991
-6,235
-14,244

5
-2,035
-8,852
-11,614

25
-1,725
-5,398
-12,215

205
1,184
-2,165
-3,113

-279
-905
-731
-3,197

—2,222
-57
-2,165
-949
-4,945

18,073

-2,030

States

31 Change in foreign private assets in the United States
(increase, + ) 3 -

1,389

-1,700

37,124

8,246

15,543

15,760

-5,685

9,333
573
4,993
969
2,205

30,294
2,308
1,644
773
2,105

6,948
627
332
-163
502

12,900
973
390
909
371

12,965
117
804
1,456
418

-5,728
211
-312
-493
637

8,643

18,897

13,746

6,005

4,522

2,336

6,090

3,143

-314

1,836

425

495

248
-68

32

U.S. bank-reported liabilities.

628

10,990

6,719

2,640

33
34
35
36

U.S. nonbank-reported

319

-507

257
-620

590

37
38

liabilities

Long-term
Short-term
Foreign private purchases of U.S. Treasury securities,
net
Foreign purchases of other U.S. securities, net
Foreign direct investments in the United States, net 3

406
-87

-958
451

2,590
2,503
2,603

2,783
1,284
4,347

877

18
572

-242
667

38
457

563
2,869
3,338

1,251
513
1,012

-299
803
450

881
462
812

39 Allocation of SDRs
Owing to seasonal adjustments
Statistical discrepancy in recorded data before seasonal
adjustment

-4,751

9,300

4 0 Discrepancy

41
42

80
187
-1,103
-3,948

4,408
905
1,647
-2,158
2,104

6,907

U.S. Treasury securities
Other U.S. government obligations
Other U.S. government liabilities5
Other U.S. liabilities reported by U.S. banks
Other foreign official assets 6

324

-2,229

'1,602
'2,276

316
847
1,308
1,852

3,798

8.830

3,638

8.831

160

5,449

9,300

'-927

-2,522

-607
5,259

-2,530
13,080

-231
35,480

151
7,914

15,153

246
14,956

329
-5,373

7,092

9,581

6,733

1,438

1,024

1,963

-2,838

2,207

373

194

31

75

57

MEMO ITEMS:

Changes in official assets:
43
U.S. official reserve assets (increase, —)
44
Foreign official assets in the United States (increase, - f ) .
45 Changes in Organization of Petroleum Exporting Countries (OPEC) official assets in the Unites States (part
of line 25 above)
46 Transfers under military grant programs (excluded from
lines 1, 4, and 9 above)

1
Seasonal factors are no longer calculated for lines 13 through 46.
2
Data are on an international accounts (IA) basis. Differs from the
Census basis primarily because the IA basis includes imports into the
U.S. Virgin Islands, and it excludes military exports, which are part of
Line 4.
3
Includes reinvested earnings of incorporated affiliates.
4
Differs from the definition of "net exports of goods and services" in
the national income and product (GNP) account. The GNP definition




711

excludes certain military sales to Israel from exports and excludes U.S.
Government interest payments from imports.
5 Primarily associated with military sales contracts and other transactions arranged with or through foreign official agencies.
6 Consists of investments in U.S. corporate stocks and in debt securities of private corporations and state and local governments.
NOTE.—Data are from Bureau of Economic Analysis, Survey of Current Business (U.S. Department of Commerce).

Trade and Reserve
3.11

Assets

A55

U.S. FOREIGN TRADE
Millions of dollars; monthly data are seasonally adjusted.
1978
1976

1977

Item

1975

1 EXPORTS of domestic and foreign
merchandise excluding grant-aid
shipments

107,589

115,156

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

121,151

NOTE.—Bureau of Census data reported on a free-alongside-ship
(f.a.s.) value basis. Effective January 1978, major changes were made in
coverage, reporting, and compiling procedures. The internationalaccounts-basis data adjust the Census basis data for reasons of coverage
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
of military exports (which are combined with other military transactions

May

June

July

Aug.

Sept.

Oct.

Nov.

11,754

12,126

11,793

12,469

13,429

13,011

13,262

and are reported separately in the "service account"). On the import
side, the largest single adjustment is the addition of imports into the
Virgin Islands (largely oil for a refinery on St. Croix), which are not
included in Census statistics.
SOURCE.—FT 900 "Summary of U.S. Export and Import Merchandise
Trade" (U.S. Dept. of Commerce, Bureau of the Census).

3.12 U.S. RESERVE ASSETS
Millions of dollars, end of period
1978
Type

1975

1 Total
2 Gold stock, including
Stabilization Fund 1

1976

1977
June

July

Aug.

Sept.

Oct.

Nov.

Dec.?
3 18,650

16,226

18,747

19,312

18,864

18,832

18,783

18,850

18,935

17,967

Exchange
11,599

11,598

11,719

11,706

11,693

11,679

11,668

11,655

11,642

3 Special Drawing Rights 2

2,335

2,395

2,629

2,804

2,860

2,885

2,942

3,097

1,522

4 Reserve position in
Monetary Fund

2,212

4,434

4,946

4,270

4,177

4,196

4,214

4,147

1,099

31,047

80

320

18

84

102

23

26

36

3,704

4

1,558

International

5 Convertible foreign currencies 4

1 Gold held under earmark at F.R. Banks for foreign and international
accounts is not inc'uded in the gold stock of the United States; see Table
3.24.
2
Includes allocations by the International Monetary Fund (IMF) of
SDR's as follows: $867 million on Jan. 1, 1970; $717 million on Jan. 1,
1971; and $710 million on Jan. 1, 1972; plus net transactions in SDR's.




11,671
3

4,374

3 Beginning July 1974, the I M F adopted a technique for valuing the
SDR based on a weighted average of exchange rates for the currencies
of 16 member countries. The U.S. SDR holdings and reserve position in
the IMF also are valued on this basis beginning July 1974.
4
Beginning November 1978, valued at current market exchange rates.

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.

May 2

June

July

Aug.

Sept.

Oct.f

275,065

287,369

292,312

14,976

12,180

All foreign countries
1 Total, all currencies
2

3
4
5

6
7
8
9
10

Claims

176,493

on United States

Parent bank
Other
Claims

on foreigners

Other assets

11 Total payable in U.S. dollars
12

13
14
15

16
17
18
19
20

6,743

7,889

3,665
3,078

4,323
3,566

163,391

Other branches of parent bank,
Banks
Public borrowers 1
Nonbank foreigners

Claims on United States

Parent bank
Other
Claims on foreigners

34,508
69,206
5,792
53,886

Other assets

204,486

45,955
83,765
10,613
64,153

258,897

260,558

259,442

271,696

269,542

11,623

13,754

8,727

10,891

9,254

7,806
3,817
238,848

55,772
91,883
14,634
76,560

9,348
4,406
237,447

51,817
92,370
15,207
78,053

4.863
3.864
241,774

52,713
91,912
21,139
76,010

6,750
4,141

5,096
4,158

251,783

250,700

55,357
96,638
'22,654
r
77,134

55,236
94,659
'23,242
'77,563

'

10,154

'5,948
4,283
'254,779

58,746
92,854
23,311
'79,868

10,693
4,206
262,063

63,493
95,222
23,852
79,496

7,901
4,279
269,110

67,634
98,221
23,937
79,318

6,359

7,045

8,425

9,357

8,941

9,022

9,588

10,132

10,330

11,022

132,901

167,695

193,764

194,168

192,466

202,792

198,205

200,915

212,063

210,939

11,049

12,952

8,035

10,107

8,473

9,349

14,168

11,339

4,906
3,567

5,758
3,591

10,535
3,633

6,408

7,595

3,628
2,780

4,264
3,332

7,692
3,357

9,158
3,795

6,580
3,527
188,590

185,425

44,256
70,786
12,632
51,222

40,628
70,504
13,232
52,513

41,209
70,124
18,275
50,723

43,544
74,842
'19,674
'50,530

43,447
71,592
'20,257
'50,129

46,326
69,594
20,221
50,897

50,880
71,892
20,474
50,211

52,866
72,667
20,290
49,047

2,997

3,204

3,820

4,339

4,100

4,095

4,307

4,528

4,438

4,730

178,896

180,331

187,038

7,710
3,629

37,909
66,331
9,022
43,634

156,896

176,877

4,712
3,323

28,478
55,319
4,864
34,835

123,496

Other branches of parent bank
Banks
Public borrowers 1
Nonbank foreigners

219,420

193,457

194,870

United Kingdom
21 Total, all currencies.
22
23
24

Claims on United

25
26
27
28
29

Claims

30

Other assets

States.

Parent bank
Other
on foreigners

Other branches of parent bank.
Banks
Public borrowers 1
Nonbank foreigners

31 Total payable in U.S. dollars.
32

33
34

Claims

on United

States.

Parent bank
Other

35
36
37
38
39

Claims on foreigners

40

Other assets.

Other branches of parent bank.
Banks
Public borrowers 1
Nonbank foreigners

74,883

81,466

90,933

87,100

89,645

93,538

92,989

93,341

99,084

101,895

2,392

3,354

4,341

2,506

2,333

3,142

2,615

'2,626

2,940

3,127

1,449
943

2,376
978

3,518
823

1,548
958

1,476
857

2,279
863

1,515
1,100

'1,597
1,029

2,014
926

2,238
889

70,331

75,859

84.016

81,871

84,700

17,557
35,904
881
15,990

19,753
38,089
1,274
16,743

22.017
39,899
2,206
19,895

19,514
40,436
2,020
19,901

19,550
40,807
4,150
20,193

87,808

87,479

19,944
43,044
'4,559
'20,261

20,438
42,462
'4,591
'19,988

'87,769

93,364

95,774

21,661
40,401
4,532
'21,175

24,691
42,677
4,505
21,491

26,396
44,046
4,695
20,637

2,159

2,253

2,576

2,724

2,612

2,588

2,895

2,946

2,780

2,994

57,361

61,587

66,635

62,330

63,565

67,016

65,452

64,457

70,008

70,217

2,273

3,275

4,100

2,312

2,163

2,870

2,321

2,337

2,885

2,374
902

3,431
669

1,520
793

2,598

1,445
828

1,452
711

2,178
692

1,386
935

1,483
854

1,895
703

2,195
690

54,121

57,488

61,408

58,845

60,277

63,043

61,938

60,907

66,242

66,132

15,645
28,224
648
9,604

17,249
28,983
846
10,410

18,947
28,530
1,669
12,263

16,531
28,177
1,631
12,507

16,406
28,324
3,254
12,293

17,025
30,686
'3,525
'11,807

17,438
29,455
'3,626
'11,419

18,305
27,310
3,502
11,790

20,934
29,859
3,440
12,009

21,351
29,706
3,586
11,489

967

824

1,126

1,173

1,125

1,103

1,193

1,213

1,168

1,200

88,755

86,290

Bahamas and Caymans
41 Total, all currencies.
42
43
44

Claims on United

45
46
47
48
49

Claims on foreigners

50

Other assets

States.

Parent bank
Other
Other branches of parent bank.
Banks
Public borrowers 1
Nonbank foreigners

51 Total payable in U.S. dollars.
For notes see opposite page.




45,203

66,11A

79,052

84,409

82,083

84,692

82,145

85,654

3,229

3,508

5,782

9,908

5,237

6,441

5,132

5,620

1,477
1,752

1,141
2,367

3,051
2,731

6,710
3,198

2,502
2,735

3,449
2,992

2,381
2,751

2,751
2,869

10,053
1,090

2,963

7,250

4,255
2,995

41,040

62,048

71,671

72,720

74,846

76,282

74,988

77,949

76,863

8,144
25,354
7,105
21,445

11,120
27,939
9,109
23,503

9,565
28,712
9,362
25,082

10,580
29,045
11,424
23,797

76,651

5,411
16,298
3,576
15,756

10,803
30,307
12,394
22,778

10,292
29,302
12,599
22,795

12,134
29,749
12,461
23,605

12,348
29,472
12,362
22,469

12,618
30,314
12,092
21,839

933

1,217

1,599

1,781

2,000

1,969

2,025

2,085

2,051

2,177

41,887

62,705

73,987

79,324

76,660

79,277

76,494

79,701

83,007

80,222

Overseas Branches

A57

3.13 Continued

1978
Liability account

1975

1976

1977
May 2

Apr.

June

July

Aug.

Sept.

Oct.f

269,542

All foreign countries
52 Total, all currencies
53

54
55
56
57

58
59
60
61
62

To United

States

65
66
67
68

69
70
71
72
73

219,420

258,897

260,558

259,442

271,696

275,065

287,369

292,312

20,221

32,719

44,154

49,088

49,907

50,534

r51,583

52,565

49,191

51,548

19,773
12,946

24,542
19,613

26,643
22,445

28,422

25,199
10,371
14,964

27,722
8,608
r
15,253

29,051
7,659
15,855

24,590
10,064
14,537

27,617
8,365
15,566

12,165
Parent bank
Other banks in United States... } 8,057
Nonbanks
149,815

To foreigners

Other branches of parent bank..
Banks
Official institutions
Nonbank foreigners
Other liabilities

63 Total payable in U.S. dollars
64

176,493

To United

States

34,111
72,259
22,773
20,672

Other liabilities

206,579

53,244
94,140
28,110
31,085

\ 12,482
202,232

202,946

50,368
87,567
29,776
34,521

48,850
91,699
28,568
33,830

213,670

6,747

8,163

8,524

7,303

7,492

173,071

198,572

197,575

196,746

207,117

19.503

31,932

42,881

47,811

19,559
12,373

24,213
18,669

26,348
21,463

137,612

151,363

48,278

27,787
( 8,704
\ 11,787

145,350

144,758

r

209,810

53,547
93.413
31.414
35,296

6,456

112,879

Other branches of parent bank..
Banks
Official institutions
Nonbank foreigners

44,370
83,880
25,829
25,877

9,003

135,907

11;939
Parent bank
Other banks in United States... } 7,564
Nonbanks

To foreigners

179,954

(

53,788
88,364
31,831
r
35,827

r

56,955

r
89,234
r

31,455
36,334

228,866

61,599
97,628
33,077
36,562

231,074

65,063
95,955
32,237
37,819

8,149

8,522

9,312

9,690

202,407

205,074

215,496

215,503

50,457

47,037

49,304

28,159
7,286
15,012

23,640
9,724
13,673

26,682
8,011
14,611

49,668

48,820

26,951
8,286
r
14,43l

24,477
10,078
14,265
154,513

213,978

r

148,630

150,474
r

163,759

161,475

28,217
51,583
19,982
13,097

37,098
60,619
22,878
17,017

43,268
64,872
23,972
19,251

39,214
61,665
23,865
20,606

40,099
57,871
25,124
21,664

42,682
62,434
26,587
22,810

42,852
56,273
26,843
r
22,662

45,620
55,285
r
26,178
23,391

49,978
63,270
27,358
23,153

52,022
58,911
26,332
24,210

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
75

76
77
78
79

80
81
82
83
84

To United

States

87
88
89
90

91
92
93
94
95

81,466

90,933

87,100

89,645

93,538

92,989

93,341

99,084

101,895

5,646

5,997

7,753

7,266

6,758

8,174

8,011

6,978

8,033

8,386

1,198
4,798

1,451
6,302

1,983
5,283

1,636
2,346
2,776

1,822
3,273
3,079

1,959
2,987
3,065

1,905
2,290
2,783

1,872
3,150
3,011

2,174
2,949
3,263

2,122
Parent bank
Other banks in United States.. } 3,523
Nonbanks

To foreigners

Other branches of parent bank.
Banks
Official institutions
Nonbank foreigners
Other liabilities

85 Total payable in U.S. dollars
86

74,883

To United

States

67,240

73,228

80,736

77,169

80,108

82,703

81,847

82,991

87,678

89,901

6,494
32,964
16,553
11,229

7,092
36,259
17,273
12,605

9,376
37,893
18,318
15,149

8,014
34,940
18,817
15,399

9,009
35,980
19,087
16,032

9,700
36,856
20,074
16,073

10,098
34,662
20,863
16,224

11,708
35,293
19,863
16,127

12,006
37,677
21,493
16,502

12,228
39,276
21,193
17,204

1,997

2,241

2,445

2,665

2,779

2,661

3,131

3,372

3,373

3,608

57,820

63,174

67,573

62,662

64,025

67,936

65,671

64,926

70,227

71,166

5,415

5,849

7,480

6,938

1,182
4,667

1,416
6,064

1,953
4,985

2,083
Parent bank
Other banks in United States.. } 3,332
Nonbanks
To foreigners

Other branches of parent bank.
Banks
Official institutions
Nonbank foreigners
Other liabilities

(
(

6,446

7,852

7,652

6,606

7,650

8,013

1,609

1,794
3,176
2,882

1,926
2,904
2,822

1,852
2,209
2,545

1,805
3,092
2,753

2,114
2,902
2,997

(

2,281

\

2,556

51,447

56,372

58,977

54,498

56,274

58,856

56,636

57,015

61,231

61,735

5,442
23,330
14,498
8,176

5,874
25,527
15,423
9,547

7,505
25,608
15,482
10,382

6,202
22,115
15,672
10,509

6,696
22,554
15,908
11,116

7,259
23,472
16,866
11,259

7,696
20,527
17,397
11,016

9,163
20,601
16,113
11,138

9,317
22,936
17,659
11,319

9,271
23,259
17,106
12,099

959

953

1,116

1,227

1,305

1,228

1,383

1,305

1,346

1,418

82,145

85,654

88,755

86,290

37,041
21,755
4,587
'10,699

39,532
23,187
4,509
11,836

34,244
18,410
5,511
10,323

35,679
20,179
4,418
11,082

r

Bahamas and Caymans
96 Total, all currencies
97

98
99
100

To United

States

45,203
11,147

Parent bank
7,628
Other banks in United States..
} 3,520
Nonbanks

66,774

79,052

84,409

22,721

32,176

37,256

16,161
6,560

20,956
11,220

22,289
14,967

82,083
37,350
23,255
(
5,625

(

8,470

84,692
35,185

19,078
5,514
10,593

r

101

To foreigners

32,949

42,899

45,292

45,610

43,394

48,088

43,649

44,597

52,707

48,955

102
103
104
105

Other branches of parent bank...
Banks
Official institutions
Nonbank foreigners

10,569
16,825
3,308
2,248

13,801
21,760
3,573
3,765

12,816
24,717
3,000
4,759

10,288
25,847
3,489
5,986

11,250
21,452
4,419
6,273

11,657
25,752
4,583
6,096

11,165
21,951
4,221
r
6,312

11,436
21,884
4,598
6,679

14,762
27,371
4,468
6,106

15,635
22,471
4,440
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

84,317

81,323

107 Total payable in U.S. dollars

42,197

63,417

74,463

i In May 1978 a broader category of claims on foreign public borrowers,
including corporations that are majority owned by foreign governments,
replaced the previous, more narrowly defined claims on foreign official
institutions.




80,243

78,254

80,650

78,131

81,314

2
In May 1978 the exemption level for branches required to report
was increased, which reduced the number of reporting branches,

A58

International Statistics • January 1979

3.14 SELECTED U.S. LIABILITIES TO FOREIGN OFFICIAL INSTITUTIONS
Millions of dollars, end of period
1978
Item

1975

1976

1977
May

June
A.

1 Total i
2 Liabilities reported by banks in the United
States 2
3 U.S. Treasury bills and certificates 3
U.S. Treasury bonds and notes:
4
Marketable
5
Nonmarketable 4
6 U.S. securities other than U.S. Treasury
securities 5

8
9
10
11
12
13

Western Europe 1
Canada
Latin America and Caribbean
Asia
Africa
Other countries 6

Sept.

Oct.f

Nov.*5

By type

95,634 131,090 140,955

140,571

144,138

146,084

145,210

152,856

156,850

16,262
34,199

17,231
37,725

18,003
47,820

19,054
56,447

18,808
55,594

19,445
56,842

20,049
56,299

19,752
55,014

22,696
57,976

21,988
62,943

6,671
19,976

11,788
20,648

32,157
20,443

32,314
19,355

32,836
19,284

34,149
19,214

34,860
20,375

35,564
20,304

36,141
21,426

36,210
20,993

5,464

8,242

12,667

13,785

14,049

14,488

14,501

14,576

14,617

14,716

144,138

146,084

145,210

152,856

156,850

75,739
2,490
4,629
58,081
2,220
979

79,723
2,071
4,621
56,848
2,036
785

80,267
1,497
3,898
56,808
2,006
734

85,302
2,618
4,611
57,407
2,184
734

88,903
2,446
4,495
57,918
2,301
787

82,572

95,634 131,090

45,701
3,132
4,461
24,411
2,983
1,884

45,882
3,406
4,926
37,767
1,893
1,760

1
Includes the Bank for International Settlements.
2
Principally demand deposits, time deposits, bankers acceptances,
commercial paper, negotiable time certificates of deposit, and borrowings
under repurchase agreements.
3
Includes nonmarketable certificates of indebtedness (including those
payable in foreign currencies through 1974) and Treasury bills issued to
official institutions of foreign countries.
4
Excludes notes issued to foreign official nonreserve agencies. Includes
bonds and notes payable in foreign currencies.




Aug.

82,572

B.
7 Total

July

70,748
2,334
4,649
50,693
1,742
924

By area

140,955 140,571
72,777
2,680
5,425
57,219
1,945
909

74,455
2,593
4,668
56,199
1,689
967

5
Debt securities of U.S. Govt, corporations and Federally sponsored
agencies, and U.S. corporate stocks and bonds.
6
Includes countries in Oceania and Eastern Europe.

NOTE.—Based on Treasury Dept. data and on data reported to the
Treasury Dept. by banks (including Federal Reserve Banks) and securities
dealers in the United States.
For a description of the changes in the International Statistics tables,
see July 1978 BULLETIN, p. 612.

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
1975

Item

1976

1977
May
A.

7 Banks' custody liabilities4
8
U.S. Treasury bills and certificates5
9
Other negotiable
and readily transferable
instruments6
10 Other
and

regional

12 Banks' own liabilities.
13 Demand deposits...
1
14 Time deposits
15 Other2
16 Banks' custody liabilities4
17
U.S. 1 reasury bills and certificates
18 Other negotiable6 and readily transferable
instruments
19 Other
20 Official institutions8 .
21
22
23
24

Banks' own liabilities.
Demand deposits...
1
Time deposits
Other2

25
26
27

Banks' custody liabilities4
U.S. Treasury bills and certificates5
Other negotiable6 and readily transferable
instruments
Other

28

29 Banks 9
30
31
32
33
34
35
36
37
38
39

Banks' own liabilities
Unaffiliated foreign banks.
Demand deposits
1
Time deposits
Other2
Banks' custody liabilities4
U.S. Treasury bills and certificates
Other negotiable6 and readily transferable
instruments
Other

41
42
43
44

Banks' own liabilities.
Demand deposits...
1
Time deposits
Other2

45
46
47

Banks' custody liabilities4
U.S. Treasury bills and certificates
Other negotiable6 and readily transferable
instruments
Other

Sept.

Oct.^

Nov.f

By holder and type of liability

16,803
11,347

18,996
11,521

61,315
17,823
11,542
7,156
24,795

60,671
17,189
11,635
6,477
25,369

61,429
17,953
11,921
6,876
24,679

63,931
16,104
12,634
7,238
27,955

68,488
17,204
12,503
6,697
32,085

71,391
17,557
12,308
10,260
31,267

74,860
18,264
12,514
8,737
35,346

37,414

40,744

48,906

75,818
58,260

75,255
57,126

75,864
57,629

76,601
57,264

75,596
56,665

79,482
59,077

83,513
63,434

14,958
2,600

15,506
2,623

15,512
2,722

16,691
2,646

16,057
2,874

17,619
2,786

17,683
2,397

3,274

3,129

2,942

2,678

2,823

3,406

2,929

2,190

501
286
61
154

480
265
119
97

1,017
257
116
644

808
142
97
569

767
144
99
523

336
133
116
87

417
153
102
161

2,627
1,153

2,462
922

1,662
228

2,014
368

2,639
1,036

2,593
403

1,774
183

1,473
1

1,537
3

1,432
1

1,645

1,603
1

2,189

1,590

65,822

75,501

74,402

76,286

76,348

74,766

80,663

84,623

9,017
3.092
1,982
3,943

8.453
2,611
1,981
3,862

9,422
3,473
2,277
3,673

9,085
2,643
2,595
3,848

9,455
3,307
2,563
3,585

11,870
3,046
2,399
6,426

10,820
3,414
2,345
5,060

66,483
56,447

65,949
55,594

66.864
56,842

67,263
56,299

65,311
55,014

68,793
57,967

73,803
62,635

9,453
583

9,857
498

9,498
524

10,326
638

9,703
594

10,616
210

11,062
107

43,338

43,363

42,921

45,532

50,410

51,243

54,934

38,960
14,165
10,338
1,325
2,502

38,824
13,454
10,164
1,255
2,035

38,358
13,680
10,240
1,321
2,119

41,028
13,073
9.229
1,390
2,454

45,640
13,555
9,713
1,618
2,223

46,288
15.022
10,156
1,552
3,315

50,133
14,788
10,068
1,735
2,985

24,795

25,369

24,679

27,955

32,085

31,267

35,346

4,378
363

4,540
300

4,562
269

4,504
296

4,771
307

4,955
381

4,801
371

2,251
1,764

2,355
1,885

2,416
1,877

2.381
1,828

2,534
1,930

2,447
2,126

2,528
1,902

14,736

15,166

15,218

15,407

15,829

15,502

16,037

16,625

12,914
4,149
8,281
484

12,631
3,983
8,208
441

13,009
4,090
8,552
368

12,627
4,039
8,222
365

12,896
4,222
8,242
433

13,490
4,628
8,331
531

5,699

5,714

139
148

290
205

231
139

2,554

2,701

706

50,461

54,956

2,644
3,423

3,394
2,321

3,528
1,797

34,199

37,725

47,820

29,330

7,534
1,873

37,174

9,104
2,297

335

10,100

119

12,814

42,335

10,933
2,040

141

3,248
4,823

4,015
6,524

4,304
7,546

12.836
4,106
8,173
557

325

198

240

2,330
297

2,304
310

2,776
290

2,819
301

2,875
308

3,141
326

3,135
245

1,780
253

1,757
237

2,165
320

2,339
179

2,218
349

2,367
448

2,503
387

9,290

9,428

9,385

9,964

9,822

10,977

10,823

49 MEMO: Negotiable time certificates of deposit
held in custody for foreigners
1
Excludes negotiable time certificates of deposit, which are included
in 2"Other negotiable and readily transferable instruments."
Includes
borrowings under repurchase agreements.
3
U.S. banks: includes amounts due to own foreign branches and
foreign subsidiaries consolidated in "Consolidated Report of Condition"
filed with bank regulatory agencies. Agencies, branches, and majorityowned subsidiaries of foreign banks: principally amounts due to head
office or parent foreign bank, and foreign branches, agencies or whollyowned
subsidiaries of head office or parent foreign bank.
4
Financial claims on residents of the United States, other than longterm
securities,
held by or through reporting banks.
5
Includes nonmarketable certificates of indebtedness (including those
payable in foreign currencies through 1974) and Treasury bills issued to
official institutions of foreign countries.




Aug.

13,564
10,267

Own foreign offices 3 .

40 Other foreigners.

48

I July

95,590 110,657 126,168 137,133 135,926 137,293 140,532 144,084 150,872 158,373

1 All foreigners
2 Banks' own liabilities.
3 Demand deposits...
1
4
Time deposits
5
Other2
6
Own foreign offices 3

11 Nonmonetary
international
organizations7

June

6
Principally bankers acceptances, commercial paper, and negotiable
time
certificates of deposit.
7
Principally the International Bank for Reconstruction and Development,
and the Inter-American and Asian Development Banks.
8
Foreign central banks and foreign central governments and the
Bank for International Settlements.
9 Excludes central banks, which are included in "Official institutions."

NOTE.—Data for time deposits prior to April 1978 represent shortterm only.
For a description of the changes in the International Statistics Tables,
see July 1978 BULLETIN, p. 612.

A60
3.15

International Statistics • January 1979
Continued
Item

1975

1976

1978

1977
May

June
B.

July

Aug.

Sept.

Oct.2*

By area and country

1 Total

95,590

110,657

126,168

137,133

135,926

137,293 140,532 144,084

150,872

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

318
2,531
770
323
5,269
7,239
603
6,857
2,869
944
273
619
2,712
12,343
130
14,125
232
1,804
98
236

352
2,893
1,110
396
6,276
9,537
563
6,364
2,993
1,643
288
717
3,302
12,534
200
11,609
168
1,731
96
211

372
2,277
1,542
407
7,353
9,727
646
7,036
3,078
1,737
227
709
3,340
11,888
147
11,770
192
1,935
55!
222

67,339
424

69,099

351
2,756
1,335
352
6,550
10,029
597
6,869
3,118
1,869
191
688
3.385
12,415

73,367

431
2,368
1,673
415
8,060
11,206
865
7,394
2,756
1,208
521
765
3,341
13,077
226
11,802
167
2,497
65
262

473
2,464
1,734
424
8,402
13,374
887
7,346
2,523
1,210
386
702
3,187
14,262
164
12,438
158
2,887
82
262

4

24

Austria
Belgium-Luxembourg...
Denmark
Finland
France
Germany
Greece
Italy
Netherlands
Norway
Portugal
Spain
Sweden
Switzerland
Turkey
United Kingdom
Yugoslavia
Other Western Europe i.
U.S.S.R
Other Eastern Europe 2 .
Canada.

25 Latin

26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43

America

and Caribbean

Argentina
Bahamas
Bermuda
Brazil
British West Indies
Chile
Colombia
Cuba
Ecuador
Guatemala 3
Jamaica 3
Mexico
Netherlands Antilles 4
Panama
Peru
Uruguay
Venezuela
Other Latin America and Caribbean.

4 4 Asia

45
46
47
48
49
50
51
52
53
54
55
56

China, People's Republic of (Mainland).
China, Republic of (Taiwan)
Hong Kong
India
Indonesia
Israel
Japan
Korea
Philippines
Thailand
Middle East oil-exporting countries 5
Other Asia

57 Africa

58
59
60
61
62
63

Egypt
Morocco
South Africa
Zaire
Oil-exporting countries 6 .
Other Africa

6 4 Other

countries..

759
2,893
329
391
7,726
4,543
284
1,059
3,407
994
193
423
2,277
8,476
118
6,867
126
2,970
40
197

346
2,187
356
416
4.876
6,241
403
3,182
3,003
782
239
559
1,692
9,460
166

10,018

189
2,673
51
236

2,919

4,659

4,607

6,600

5,816

5,623

5,890

5,122

7,418

19,132

23,670
1,416

25,049

25,425

24,831

27,259

29,284

28,466

1,534
2,770
218
1,438
1.877
337
1,021
6
320

2,070
129
1,115
243
172
3,309
1,393

2,870
158
1,167
257
245
3,118
1,797

3,596
321
1,396
3,998
360
1,221
6
330
2,876
196
2,331
287
243
2,929
2,167

22,384

29, 766

30,488

123
1,025
605
115
369
387
10,207
390
700
252
7,355
856

48
990
894
638
340
392
14,363
438
628
277
9,360
1,398

53
1,013
1,094
961
410
559
14,616
602
687
264
8,979
1,250

3,369

2,298
333
87

2,535

342
68
166
62
2,240
491

141
36
1,116
585

404
66
174
39
1,155
698

2,012
1,905
107

1,297

2,006
113

67 Nonmonetary international and regional
organizations

5,699

5,714

68
69
70

5,415
188
96

5,157
267
290

65
66

Australia
All other

International
Latin American regional.
Other regional7

2,119

c ud s t h e B a n k f o r
! ®
International Settlements. Beginning April
1978, also includes Eastern European countries not listed in line 23
2
Beginning April 1978 comprises Bulgaria, Czechoslovakia, German
Democratic Republic, Hungary, Poland, and Romania.
1 9 7 8 I n d U d e d ^ " ° t h e r L a t i n A m e r i c a a n d Caribbean" through March
4
Includes Surinam through December 1975.
s
Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia
and United Arab Emirates (Trucial States).




110

11,471
229
1,666
66
255

2,174
1,593
416
7,989
10,766
826
8,055
3,240
1.516
324
752
3,355
12,102
137
10,956
149
2,311
46
210

15,028

1,146
1,874
184
1,219
1,311
319
417
6
120

2,260
3,327
339
1,298
3,949
361
1,300
7
318
552
46
2,970
289
2,609
274
208
3,298
1,643

1,692
3,954
396
1,220
4,769
376
1,424
7
325
448
66
2,776
320
2.386
282
220
3,157
1,606

1,550
3,629
383
1,295
4,009
380
1,429
9
378
415
75
2,921
435
2,639
309
218
3,229
1,530

1,453
4,601
372
1,382
5,474
346
1,486
10
347
419
59
3,171
288
2,628
311
185
3,208
1.517

35,171
41

33,463
44

1,393
7,249
409
1,350
5,380
351
1,431
7
405
347
78
3,112
317
2,741
321
197
2,560
1,637

35,463

33,665

47
1,060
1,489
962
451
568
19,731
817
688
304
8,059
1,285

53
1,053
1,085
899
330
476
19,020
748
595
297
7,894
1,213

1,195
1,191
798
597
519
20,374
714
640
320
7,267
1,510

1,262
1,21
762
309
440
19,755
736
566
296
6,719
1,364

1,230
833
348
432
19,890
lie
623
290
6,350
1,341

2,643

2,360

3,013

2,578

2,645

594
28
175
73
1,365
778

463
67
160
52
1,198
638

417
74
238
45
1,270
601

461
29
185
49
1,244
676

402
28
226
44
979
681

33,438

46

1,280

158,373

1,650
4,877
387
1,441
5,916
333
1,483
7
369
368
57
3,101
353
2,396
323
210
3,696
1,498
34,963

49
1,318
1,348
899
575
453
19,901
784
594
352
6,911
1,780
2,540
322

84
266
39
1,230
600

1,267

1,414

1,315

1,129
138

1,211
203

1,158
157

1,180
1,051
130

1,090

899
191

975
213

3,274

3,129

2,942

2,678

2,823

3,406

2,929

2,752
278
245

2,430
430
269

2,311
395
236

2,027
411
241

2,157
437
228

2,339
799
269

1,789
856
284

1,140
158

Nov.*5

1,189

6

Comprises Algeria, Gabon, Libya, and Nigeria.
7
Asian, African, Middle Eastern, and European regional organizations,
except the Bank for International Settlements, which is included in
"Other Western Europe."
NOTE.—For a description of the changes in the International Statistics
tables, see July 1978 BULLETIN, p. 612.

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

1976

1975

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
94
793
185
184
1,679
751
279
1,184
468
209
132
699
184
390
306
6,951
285
137
362
536

16,249
105
731
145
182
1,891
787
204
965
383
217
126
706
219
685
309
7,270
320
153
319
534

15,762
116
634
129
190
1,813
689
190
1,078
436
210
140
669
244
631
313
6,961
300
165
305
548

16,829
107
823
146
216
2,523
632
125
1,027
405
163
105
714
290
1,013
305
6,933
280
125
343
553

18,301
95
949
147
221
2,786
742
126
1,016
379
263
99
770
325
871
305
7,827
306
128
370
575

19,197
111
1,036
160
232
2,708
808
161
1,353
494
238
106
927
348
781
293
8,000
293
147
387
617

20,459
143
1,222
193
260
2,705
838
134
1,452
602
282
180
981
465
1,045
283
8,324
302
115
321
612

4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23

Austria
Belgium-Luxembourg
Denmark
Finland
France
Germany
Greece
Italy
Netherlands
Norway
Portugal
Spain
Sweden
Switzerland
Turkey
United Kingdom
Yugoslavia
Other Western Europe i
U.S.S.R
Other Eastern Europe 2

24

Canada.

25 Latin

26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43

America

and Caribbean

Argentina
Bahamas
Bermuda
Brazil
British West Indies
Chile
Colombia
Cuba
Ecuador
Guatemala 3
Jamaica 3
Mexico
Netherlands Antilles 4
Panama
Peru
Uruguay
Venezuela
Other Latin America and Caribbean.,

35
286
104
180
1,565
380
290
443
305
131
30
424
198
199
164
5,170
210
76
406
513

63
482
133
199
1,549
509
279
993
315
136
88
745
206
379
249
7,033
234
85
485
613

2,834

3,319

3,355

23,863

38,879

45,850

1,377
7,583
104
3,385
1,464
494
751
14
252

1,192
15,464
150
4,901
5,082
597
675
13
375

1,478
19,858
232
4,629
6,481
675
671
10
517

3,745
72
1,138
805
57
1,319
1,302

4,822
140
1,372
933
42
1,828
1,293

4,909
224
1,410
962
80
2,318
1,394

4 4 Asia

17,706

19,204

45

22
1,053
289
57
246
721
10,944
1,791
534
520
744
785

3
1,344
316
69
218
755
11,040
1,978
719
442
1,459
863

1,933

2,311

China, People's Republic of (Mainland).
China, Republic of (Taiwan)
Hong Kong
India
Indonesia
Israel
Japan
Korea
Philippines
Thailand
Middle East oil-exporting c o u n t r i e s 5 . . . .
Other Asia

57 Africa

58
59
60
61
62
63

Egypt
Morocco
South Africa
Zaire
Oil-exporting countries 6 .
Other

6 4 Other

65
66

countries.,

Australia
All other

67 Nonmonetary International and Regional
Organizations 7
1

123
8
657
181
382
581

19,236

10
1,719
543
53
232
584
9,839
2,336
594
633
1,746
947
2,518

126
27
957
112
524
565

119
43
1,066
98
510
682
1,090

2,412

2,493

3,116

3,343

3,448

3,584

4,537

46,942
1,595
21,041
345
4,443
6,272
717
578
I
529
79
42
4,505
206
2,147
920
58
2,233
1,233

45,990
1,556
18,725
145
4,659
7,412
745
615

46,974
1,572
19,643
145
4,599
6,872
745
648

49,469
1,566
22,172
194
4,858
6,885
809
6 9 0J

50,397
1,690
20,031
141
5,252
8,397
742
7 2 7J

49,215
1,448
19,205
357
5,591
7,171
832
793

54,299
1,698
23,510
141
6,141
6,421
862
935

562
90
53
4,865
212
1,901
930
53
2,240
1,227

546
83
49
5,068
206
2,278
918
52
2,337
1,212

560
115
44
5,004
198
1,625
928
56
2,515
1,250

646
79
46
5,007
230
2,280
966
51
2,745
1,367

623
83
66
4,852
213
2,482
945
63
3,105
1,387

681
90
49
5,255
241
2,526
931
58
3,367
1,389

19,448
22
1,456
754
70
137
494
9,741
1,801
751
730
2,521
970

19,317
13
1,343
769
80
146
468
10,023
2,328
680
711
1,575
1,181

2,218
72
37
1,055
80
441
533

18,326
5
1,193
698
46
139
445
9,779
1,937
641
725
1,551
1,167

18,918
31
1,177
666
73
125
504
9,876
1,925
743
693
1,951
1,155

2,136
70
38
1,054
79
383
512

2,133
79
36
1,036
79
340
563

18,994
8
1,241
705
76
152
544
10,205
1,930
730
633
1,656
1,113

21,249
10
1,289
1,320
66
144
555
10,505
1,779
732
741
2,096
2,012

2,267
62
42
1,058
79
459
566

2,158
67
38
1,022
82
406
544

2,218
56
40
990
161
438
533

2,163
68
36
906
162
439
551

22,436
6
1,338
1,242
46
188
719
11,884
1,741
717
758
2,181
1,617

830

772

700
130

597
175

905
186

965
798
166

995
828
167

1,002
836
167

980
835
145

1,063
894
168

1,023
879
145

1,041
894
147

33

40

43

34

31

36

38

39

41

42

Includes the Bank for International Settlements. Beginning April'
1978, also includes Eastern European countries not listed in line 23.
2
Beginning April 1978 comprises Bulgaria, Czechoslovakia, German
Democratic Republic, Hungary, Poland, and Romania.
3
Included in "Other Latin America and Caribbean" through March
1978.
4
Includes Surinam through December 1975.
5
Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia,
and United Arab Emirates (Trucial States).




65
561
173
172
2,082
644
206
1,334
338
162
175
722
218
564
360
8,964
311
86
413
566

6
Comprises Algeria, Gabon, Libya, and Nigeria.
7
Excludes the Bank for International Settlements, which is included
in "Other Western Europe."

NOTE.—Data for period prior to April 1978 include claims of banks'
domestic customers on foreigners. For a description of the changes in
the International Statistics tables, see July 1978 BULLETIN, p. 612.

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

58,308

1 Total

79,301

June

July

Aug.

96,184

90,206

Sept.

Oct.?

Nov. 2

103,495

2 Banks' own claims on foreigners.

87,832

87,212

87,349

91,844

94,399

96,527

104,975

3
4
5
6
7
8

5,739
35,882
27,772
4,656
23,115
18.439

6,036
31,590
30,166
5,116
25,050
19.419

6,858
33,813
27,499
4,623
22,876
19,179

7,292
37,325
27,400
4.352
23,049
19,826

7,708
34,828
31,467
4,482
26,985
20,396

7,949
36,402
31,031
3,965
27,066
21,145

9,176
40,330
33,582
4,004
29,578
21,887

Foreign public borrowers.
Own foreign offices 1
Unaffiliated foreign banks.
Deposits
Other
All other foreigners

9 Claims of banks' domestic customers 2 .
10
11
12

Deposits
Negotiable and readily transferable instruments 3
Outstanding collections and other c l a i m s 4 . . . .

13 MEMO: Customer liability on

8,973

5,467

5,756

1
U.S. banks: includes amounts due from own foreign branches and
foreign subsidiaries consolidated in "Consolidated Report of Condition"
filed with bank regulatory agencies. Agencies, branches, and majorityowned subsidiaries of foreign banks: principally amounts due from head
office or parent foreign bank, and foreign branches, agencies, or whollyowned subsidiaries of head office or parent foreign bank.
2
Assets owned by customers of the reporting bank located in the
United States that represent claims on foreigners held by reporting banks
for the account of their domestic customers.




6,176

acceptances...

9,095

389

563

3,694
4,889

3,717
4,816

11,995

13,091

3

Principally negotiable time certificates of deposit and bankers acceptances.
4
Data for March 1978 and for period prior to that are outstanding
collections only.
NOTE.—Beginning April 1978, data for banks' own claims are given
on a monthly basis, but the data for claims of banks' domestic customers
are available on a quarterly basis only.
For a description of the changes in the International Statistics tables,
see July 1978 BULLETIN, p. 612.

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
1979

1978
1978

Maturity; by borrower and area

1979
June*1

1 Total.
By borrower:
3
4

Foreign public borrowers
All other foreigners
Maturity of over 1 year*
Foreign public borrowers....
All other foreigners

5
6
7

....
...

Sept.P

55,128

59,516

43,682
2,919
40,763

46,684
3,640
43,044

11,445
3,162
8,283

12,832
3,928
8,904

8
9
10
11
12
13

By area:
Maturity of 1 year or less 1
Europe
Canada. .
Latin America and Caribbean
Asia
Africa .
All other 2

9,532
1,615
17,036
13,515
1,461
523

10,386
1,943
18,518
13,712
1,535
591

14
15
16
17
18
19

Maturity of over 1 year 1
Europe
Canada
Latin America and Caribbean
Asia
Africa
All other 2

2,979
330
5,979
1,282
629
247

3,104
793
6,843
1,305
577
211

1
Remaining time to maturity.
2 Includes nonmonetary international and regional organizations.

Dec.

Mar.

June

Sept.

NOTE.—The first available data are for June 1978. For a description of
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.

1 Banks' own liabilities
2 Banks' own claims 1
3
Deposits
4
Other claims
5 Claims of banks' domestic customers 2
1
2

766
1,276
669
607

Includes claims of banks' domestic customers through March 1978.
Assets owned by customers of the reporting bank located in the
United States that represent claims on foreigners held by reporting banks
for the accounts of their domestic customers.




560
1,459
656
802

781
1,834
1,103
731

925
2,356
941
1,415

986
2,383
948
1,435

Junef
1,704
3,153
1,290
1,863
809

Sept.?
1,980
3,530
1,386
2,144
446

NOTE.—Data on claims exclude foreign currencies held by U.S. monetary authorities.
For a description of the changes in the International Statistics Tables,
see July 1978 BULLETIN, p. 612.

A64

International Statistics • January 1979

3.20 MARKETABLE U.S. TREASURY BONDS AND NOTES

Foreign Holdings and Transactions

Millions of dollars
1978
Country or area

1976

1977

1978
*

Jan.NOV.p

May

June

July

Aug.

Sept.

Oct.f

Nov.f

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

13,936

12,966

13,106

14,226

14,154

14,689

15,260

15,654

3
4
5
6
7
8
9
10
11

2,330

Europe

Belgium-Luxembourg..
Germany
Netherlands
Sweden
Switzerland
United Kingdom
Other Western Europe.
Eastern E u r o p e . . . . . . .

14
764
288
191
261
485
323
4

19
3,168
911
100
497
8,888
349
4

19
4,031
1,070
175
468
6,856
348

19
4,361
1,113
185
529
6,527
371

19
5,531
1,113
200
590
6,403
370

19
5,761
1,278
210
636
5,862
387

19
6,157
1,306
211
694
5,909
393

19
6,645
1,356
231
731
5,915
365

19
7,102
1,351
266
915
5,674
327

12

Canada.

256

288

261

264

275

276

276

151

151

13
14
15
16

Latin America and Caribbean
Venezuela
Other Latin American and Caribbean.
Netherlands Antilles

313
149
47

118

551
199
183
170

503
174
167
162

494
174
158
162

485
174
149
162

545
244
139
162

445
144
139
162

426
144
119
162

416
144
109
162

17

18

Asia
Japan.

9,323
2,687

18,745
6,860

20,137
8,964

20,605
9,616

20,831
9,927

21,647
10,791

21,919
11,096

21,938
11,560

21,560
11,483

19

Africa

543

362

491

491

491

491

491

691

691

4

-3

7

5

6

-3

20

11

All other.

21 Nonmonetary international and regional
organizations.
22
23

International
Latin American regional.

3,034

4,746

5,021

5,694

4,842

4,454

4,386

5,150

5,378

2,906
128

4,646
100

4,931
90

5,633
61

4,809
33

4,421
33

4,354
33

5,118
33

5,345
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

27

5,119
274

20,369
762

4,052
521

-566
99

522
77

1,313
29

710
103

704
3

577
69

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
30
Africa 2

3,887
221

4,451
-181

-1,663
329

-563
150

-185

-85

-31

-31

-401
200

-241
-1

Other foreign

1 Comprises Bahrain, Iran, Iraq, Kuwait, Oman, Qatar, Saudi Arabia,
and United Arab Emirates (Trucial States).
2 Comprises Algeria, Gabon, Libya, and Nigeria.

3.21

3
Estimated official and private holdings of marketable U.S. Treasury
securities with an original maturity of more than 1 year. Data are based
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.

FOREIGN OFFICIAL ASSETS HELD AT FEDERAL RESERVE BANKS
Millions of dollars, end of period
1978
Assets

1975

1976

1977
June

Assets held in custody:
2
U.S. Treasury securities 1

Aug.

Sept.

Oct.

Nov.

Dec.?

353

352

424

288

347

309

325

305

379

367

60,019
16,745

66,532
16,414

91,962
15,988

99,465
15,620

101,696
15,594

102,902
15,572

102,699
15,553

107,934
15,548

112,434
15,525

117,126
15,463

1 Marketable U.S. Treasury bills, certificates of indebtedness, notes,
and bonds; and nonmarketable U.S. Treasury securities payable in dollars
and in foreign currencies.
2 The value of earmarked gold increased because of the changes in
par value of the U.S. dollar in May 1972 and in October 1973.




July

NOTE.—Excludes deposits and U.S. Treasury securities held for international and regional organizations. Earmarked gold is gold held for
foreign and international accounts and is not included in the gold stock
of the United States.

Investment transactions

A65

3.22 FOREIGN TRANSACTIONS IN SECURITIES
Millions of dollars
1978
Transactions, and area or country

1976

1978

1977
Jan.Nov.f

May

June

July

Aug.

Sept.

Oct.f

Nov.f

U.S. corporate securities

1
2
3
4

Stocks
Foreign purchases
Foreign sales

18.227
15,475

14,155
11,479

18,648
16,614

2,391
1,963

Net purchases, or sales (—)

2,753

2,676

2,034

Foreign countries

2,740

2,661

2,055
1,936

1,305
1,296

2,444
2,678

2,357
2,115

1,510
1,523

1,461
1,359

427

119

9

-235

241

-14

102

2,080

427

139

9

-235

244

-15

102

5
6
7
8
9
10

Europe
France
Germany
Netherlands
Switzerland
United Kingdom

336
256
68
-199
-100
340

1,006
40
291
22
152
613

970
85
356
-13
-562
1,144

323
-2
52
9
31
229

39
-39
83
-18
-76
101

-6
-15
17
9
-52
50

-152
9
-54
-22
-184
110

-33
2
24
7
-115
54

-91
-4
-30
7
-118
58

-10
1
8
6
-88
67

11
12
13
14
15
16

Canada
Latin America
and Caribbean
Middle East 1
Other Asia
Africa
Other countries

324
155
1,803
119
7
-4

65
127
1,390
59
5
8

37
135
777
171
-12
2

-58
36
90
39
-4

-12
33
59
23
-3

-16
-35
69
-5
1

-18
48
-134
35
-12

117
1
120
35
5

22
13
42
-4
2
2

6
-2
109
1
-2
1

13

15

-47

1

-21

*

-3

1

5,529
4,327

7,739
3,546

7,070
4,891

779
333

669
302

1,029
596

872
490

611
550

727
530

437
388

17

Nonmonetary international and regional
organizations

Bonds 2
18
Foreign purchases
19
Foreign sales

•

*

*

*

*

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

86
39
-49
-29
155
23

1,863
-34
-20
72
94
1,703

814
12
109
25
-139
821

41
8
21
-3
-36
75

157
-3
14
-7
5
154

387
13
18
11
-74
416

137
6
38
18
-20
89

80
-2
-5
19
43

89
-10
-12
-4
9
110

25
3
6
-1
9
9

96
94
1,179
-165
-25
-21

141
64
1,695
338
-6

9
12
370
14

6
2
91
39

14
-8
135
-116

24
17
99
52

16
11
-73
29

-5
13
-19
60

-41

96

22
23
24
25
26
27

Europe
France
Germany
Netherlands
Switzerland
United Kingdom

28
29
30
31
32
33

Canada
Latin America
and Caribbean
Middle East 1
Other Asia
Africa
Other countries

34

Nonmonetary international and regional
organizations

*

96
73
831
145
—1
4

*

1

217

-1

*

*

*

*

*

1

72

*

*
*

*

*

*

*

*

-1
-8
23

22

53

-3

60

10

Foreign securities
35 Stocks, net purchases, or sales (—)
36
Foreign purchases
37
Foreign sales

-323
1,937
2,259

-410
2,255
2,665

536
3,429
2,893

-13
271
284

-61
247
308

10
333
323

51
382
331

-69
261
330

-19
299
318

163
360
197

38 Bonds, net purchases, or sales (—)
39
Foreign purchases
40
Foreign sales

-8,774
4,932
13,706

-5,095
8,040
13,134

-4,045
9,992
14,037

-39
1,017
1,056

-636
1,095
1,730

-291
921
1,212

-196
982
1,178

33
759
726

-677
941
1,618

-431
871
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
43
Europe
44
Canada
45
Latin America and Caribbean
46
Asia
47
Africa
48
Other countries

-7,199
-850
-5,245
-3
-733
48
-416

-3,947
-1,100
-2,404
-80
-97
2
-267

-3,291
-86
-3,213
220
380
-441
-151

-67
-194
-80
72
131

-283
-171
-146
8
44
-25
7

-150
94
-161
-17
54
-123
3

-70
-86
-41
-12
69
_ i

-507
13
-747
-17
236

4

-742
-220
-420
-68
192
-44
-182

1

6

-288
-102
-246
33
21
1
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,
Kuwait, Oman, Qatar, Saudi Arabia, and United Arab Emirates (Trucial
States).




2

*

Includes State and local government securities, and securities of U.S.
Govt, agencies and corporations. Also includes issues of new debt securities
sold abroad by U.S. corporations organized to finance direct investments
abroad.

A66

International Statistics • January 1979

3.23 SHORT-TERM LIABILITIES TO AND CLAIMS ON FOREIGNERS
in the United States

Reported by Nonbanking Concerns

Millions of dollars, end of period
1977

Type, and area or country
June

1978

Sept.

Dec.

1977

June?

Mar.

June

Sept.

Liabilities to foreigners
1 Total

1978
Dec.

June^

Mar.

Claims on foreigners

6,624

7,315

7,971

8,448

8,817

16,352

15,249

16,293

18,481

18,293

5,909

6,459

7,171

7,564

7,992

15,192

14,132

14,863

16,762

16,711

1,160

1,117

1,430

1,718

1,582

By type:
2

Payable

in dollars

3
4

Payable

in foreign

5

currencies

28

Canada

29
30
31
32
33
34
35
36
37
38
39
40
41
42
43

Latin

America

Argentina
Bahamas
Brazil
Chile
Colombia
Cuba
Mexico
Panama
Peru
Uruguay
Venezuela

Other Latin American republics
Netherlands Antilles
Other Latin America

Thailand
Other Asia

56
57
58
59
60
61

Africa

62
63
64

Other countries

Egypt
Morocco
South Africa
Zaire
Other Africa
Australia
All other

65 Nonmonetary international and regional
organizations

825

6,454

7,161

7,756

8,301

8,685

2,335

2,512

2,854

3,028

23
151
14
10
156
163
73
138
212
12
20
68
36
236
21
780
110
6
16
10

19
126
16
11
170
226
78
107
180
12
12
74
41
257
97
784
92
9
11
14

448
1,028

50
223
37
24
22
*

*

120
11
21
3
208
141
17
151
2

138
27
41
80
45
183
88
73
11
1,329

21
116
14
9
238
284
85
128
232
7
11
77
28
263
108
756
90
10
24
12

451
1,035

530
1,352

40
308
49
17
42
*

103
12
13
4
225
122
9
154

26
171
23
12
273
335
108
104
253
9
7
94
37
229
93
954
82
8
15
23

504
1,186

50
229
76
13
24

53
310
62
14
26
*

114
22
15
3
222
118
25
209

169
12
22
5
280
107
41
250

414
703

620
809

724
995

676
907

16,351

15,248

16,291

18,479

18,291

5,799

5,077

5,797

5,626

5,326

26
212
40
90
413
377
86
440
182
42
30
322
92
179
37
3,012
28
15
76
102

24
226
44
59
430
393
52
352
161
38
34
307
91
146
32
2,495
20
15
62
96

24
211
56
13
513
453
41
387
166
42
69
387
117
220
39
2,825
20
25
55
135

21
187
47
13
545
411
42
382
184
42
27
408
117
238
35
2,706
24
33
44
121

28
155
40
53
543
419
40
459
187
47
54
376
78
296
29
2,374
27
29
37
56

524

2,709

2,649

2,682

3,429

3,486

5,000

4,619

4,491

5,895

6,067

51
2,309
457
28
72

53
1,963
414
40
85

53
2,028
517
45
84

53
3,108
499
40
80

61
3,108
494
37
79

302
222
30
5
251
257
8
989

314
91
32
5
269
281
12
759

1,419

*

448
713

26
167
22
9
323
355
82
156
221
13
25
105
38
282
92
976
84
18
19
18

74
307
78
23
27

*

185
71
17
9
197
101
30
299

2,640

2,871

2,850

3,000

1
152
25
44
60
58
604
75
78
17
1,526

8
156
40
37
56
63
695
103
74
17
1,623

1
167
32
26
57
68
761
99
95
11
1,535

1
170
29
11
59
59
799
107
107
27
1,631

301
121
28
5
237
237
8
1,146
2,323
1

131
93
51
184
70
927
158
90
22
591

*

*

*

*

312
175
30
6
306
268
24
994

2,403

2,782

12
139
73
42
185
46
1,026
153
111
24
590

9

2,976
22

157
98
38
375
38
1,068
171
99
23
708

144
85
85
185
47
1,379
133
94
32
770

331
97
30
4
311
235
19
1,261
2,836

21
173
93
93
153
43
1,157
170
94
30
808

609

588

591

612

603

370

346

393

408

433

33
72
27
39
438

45
105
29
48
361

13
112
20
46
400

19
130
30
55
378

25
148
39
57
335

24
11
69
17
248

22
10
75
19
221

38
21
75
15
245

33
22
71
11
271

38
16
85
16
279

111

98

111

93

104

149

153

146

145

144

78
20

93
18

75
18

89
14

97
14

110
40

113
41

111
35

111
34

109
34

170

154

215

147

132

1

1

1

1

2

NOTE.—Reported by exporters, importers, and industrial and commercial concerns and other nonbanking institutions in the United States.




884

2,253

2,017

China, People's Republic of (Mainland)....
China, Republic of (Taiwan)
Hong Kong
India
Indonesia
Israel
Japan
Korea

801

857

Deposits with banks abroad in reporter's
name
Other

By area or country:
6 Foreign countries
7
Europe
Austria
8
9
Belgium-Luxembourg
10
Denmark
11
Finland
12
France
13
Germany
14
Greece
15
Italy
16
Netherlands
17
Norway
18
Portugal
19
Spain
Sweden
20
21
Switzerland
Turkey
22
23
United Kingdom
24
Yugoslavia
25
Other Western Europe
26
U.S.S.R
27
Other Eastern Europe

44
45
46
47
48
49
50
51
52
53
54
55

715

Data exclude claims held through U.S. banks and intercompany accounts
between U.S. companies and their affiliates.

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

1 Total

1974

1976

1975

2

Payable

in dollars

Deposits
Short-term investments

5

Payable

6
7

in foreign

currencies

Deposits
Short-term investments 1 .
By country:
United Kingdom
Canada
Bahamas
Japan
All other

8
9
10
11
12

May

June

July

Aug.

Sept.

Oct.f

8,912

8,924

10,092

8,550

10,499

3,357

3,799

5,720

7,179

9,679

2,660

3,042

4,984

6,158

8,534

7,771

7,639

8,804

5,740
418

9,237

2,710
332

4,505
479

7,331

2,591
69

7,897
637

7,218
553

7,156
483

8,243
561

6,894
437

8,686
551

1,021

1,145

1,142

1,285

1,289

1,220

1,261

By type:
3
4

1977

697

757

735

429
268

511
246

404
331

553
468

544
601

599
543

669
616

669
620

725
495

787
474

1,350
967
391
398
252

1,306
1,156
546
343
446

1,838
1,698
1,355
133
716

2,144
1,777
1,904
153
1,201

1,660
2,866
3,612
266
1,275

1,683
2,547
2,975
273
1,435

1,861
2,513
3,222
286
1,042

1,839
3,008
3,541
292
1,412

2,171
2,440
2,235
267
1.437

2,947
2,857
2,819
234
1,642

i Negotiable and other readily transferable foreign obligations payable
on demand or having a contractural maturity of not more than 1 year
from the date on which the obligation was incurred by the foreigner.

NOTE.—Data represent the assets abroad of large nonbanking concerns in the United States. They are a portion of the total claims on
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
in the United States

Reported by Nonbanking Concerns

Millions of dollars, end of period
1977

1977

1978

1978

Area and country
June

Sept.

Dec.

Mar.

2

June '

June

Liabilities to foreigners

Sept.

Dec.

Mar.

June?

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...
3
Germany
4
Netherlands
5
Switzerland
6
United Kingdom

2,504
370
262
177
1,277

2,602
407
272
224
1,295

2,499
255
287
241
1,276

2,571
295
292
241
1.284

2,494
282
266
236
1,270

901
76
147
43
283

829
76
81
42
282

860
70
82
49
310

935
73
81
48
332

936
65
76
55
363

79

76

71

67

66

1,486

1,462

1,776

1,792

1,811

8 Latin America
9
Bahamas
10
Brazil
11
Chile
12
Mexico

297
160
7
1
26

289
151
7
1
30

284
148
7
1
30

250
142
6
1
30

250
141
7
1
28

1,452
34
125
208
178

1,367
36
134
201
187

1,402
40
144
203
177

1,387
42
154
194
183

1,298
2
143
190
188

13 Asia

408
386

358
319

342
305

284
250

286
251

851
111

829
94

817
66

810
83

803
78

7 Canada

15 Africa
16 All other i
1

3

3

2

2

2

158

165

161

156

154

67

59

60

60

60

67

63

59

60

59

Includes nonmonetary international and regional organizations.




A68

International Statistics • January 1979

3.26 DISCOUNT RATES OF FOREIGN CENTRAL BANKS
Per cent per annum

Country

Country
Month
effective

Per
cent

18.0

Argentina
Austria...
Belgium. .
Brazil
Canada..
Denmark.

4.5
6.0
33.6
10.75
8.0

Feb.
June
July
July
Nov.
July

Per
cent

1972
1978
1978
1978
1978
1977

France
Germany, Fed. Rep. of.
Italy
Japan
Mexico
Netherlands

9.5
3.0
10.5
3.5
4.5
6.5

Month
effective
Aug.
Dec.
Sept.
Mar.
June
Oct.

1977
1977
1978
1978
1942
1978

Per
cent

Month
effective

7.0
6.5
1.0
12.5
5.0

United Kingdom

Feb.
July
Feb.
Nov.
Oct.

1978
1978
1978
1978
1970

more than one rate applicable to such discounts or advances, the rate
shown is the one at which it is understood the central bank transacts the
largest proportion of its credit operations.

NOTE.—Rates shown are mainly those at which the central bank either
discounts or makes advances against eligible commercial paper and/or
government securities for commercial banks or brokers. For countries with

3.27

Rate on Dec. 31, 1978

Rate on Dec. 31, 1978

Rate on Dec. 31, 1978
Country

FOREIGN SHORT-TERM INTEREST RATES
Per cent per annum, averages of daily figures
1978
1977

1976

Country, or type

1978
July

1 Euro-dollars
2 United Kingdom
3 Canada
4
5
6
7

Sept.

Nov.

Oct.

Dec.

5.58
11.35
9.39

6.03
8.07
7.47

8.74
9.18
8.52

8.52
10.13
8.23

8.48
9.42
8.77

9.12
9.29
9.08

10.12
10.44
9.68

11.51
12.00
10.37

11.62
12.28
10.44

4.19
1.45
7.02
8.65

4.30
2.56
4.73
9.20

3.67
0.74
6.53
8.10

3.71
1.74
5.61
7.61

3.64
0.67
6.27
7.39

3.67
0.58
6.91
7.40

3.90
0.24
11.23
7.37

3.81
0.20
8.86
7.06

4.09
0.22
10.25
6.59

16.32
10.25
7.70

14.26
6.95
6.22

11.40
7.14
4.75

11.75
5.84
4.75

11.75
7.09
4.64

10.94
7.24
4.51

10.99
8.55
4.44

11.17
9.19
4.78

11.24
9.28
4.76

Germany
Switzerland
Netherlands
France

8 Italy
9 Belgium
10 Japan

Aug.

NOTE.—Rates are for 3-month interbank loans except for—Canada,
finance company paper; Belgium, time deposits of 20 million francs and

over; and Japan, loans and discounts that can be called after being held
over a minimum of two month-ends.

3.28 FOREIGN EXCHANGE RATES
Cents per unit of foreign currency
1978
Country/currency

1976

1977

1978
July

Aug.

Sept.

Oct.

Nov.

Dec.

Australia/dollar
Austria/schilling
Belgium/franc
Canada/dollar
Denmark/krone

122.15
5.5744
2.5921
101.41
16.546

110.82
6.0494
2.7911
94.112
16.658

114.41
6.8958
3.1809
87.729
18.156

114.94
6.7547
3.0864
88.921
17.846

115.41
6.9490
3.1834
87.690
18.171

115.29
7.0102
3.2207
85.739
18.411

116.87
7.4526
3.4503
84.546
19.584

114.53
7.1808
3.3389
85.244
19.025

114.15
7.2621
3.3637
84.763
19.063

6
7
8
9
10

Finland/markka
France/franc
Germany/deutsche m a r k . . .
India/rupee
Ireland/pound

25.938
20.942
39.737
11.148
180.48

24.913
20.344
43.079
11.406
174.49

24.337
22.218
49.867
12.207
191.84

23.809
22.531
48.647
12.245
189.49

24.381
22.998
50.084
12.483
194.06

24.586
22.909
50.778
12.445
195.95

25.454
23.767
54.430
12.643
200.75

24.932
22.958
52.508
12.458
196.08

24.957
23.178
53.217
12.174
198.61

11
12
13
14
15

Italy/lira
Japan/yen
Malaysia/ringgit
Mexico/peso
Netherlands/guilder

16
17
18
19
20

New Zealand/dollar
Norway/krone
Portugal/escudo
South Africa/rand
Spain/peseta

99.115
18.327
3.3159
114.85
1.4958

96.893
18.789
2.6234
114.99
1.3287

103.64
19.079
2.2782
115.01
1.3073

103.85
18.524
2.1939
115.00
1.2885

105.42
19.018
2.2042
115.00
1.3344

105.58
19.189
2.1948
115.00
1.3605

107.37
20.325
2.2342
115.00
1.4317

105.41
19.736
2.1510
115.04
1.4051

105.45
19.574
2.1472
115.01
1.4085

21
22
23
24

Sri Lanka/rupee
Sweden/krona
Switzerland/franc
United Kingdom/pound...

11.908
22.957
40.013
180.48

11.964
22.383
41.714
174.49

6.3834
22.139
56.283
191.84

6.3245
22.012
55.443
189.49

6.3926
22.523
60.013
194.06

6.3855
22.592
63.765
195.95

6.3757
23.349
65.117
200.75

6.4695
22.856
59.766
196.08

6.4700
22.808
59.703
198.61

105.57

103.31

88.86

88.52

1
2
3
4
5

.12044
.33741
39.340
6.9161
37.846

.11328
.37342
40.620
4.4239
40.752

.11804
.50101
42.447
4.3756
45.076

.11782
.47981
43.210
4.3896
46.284

.11952
.53002
43.433
4.3758
46.203

.12050
.52656
43.603
4.3907
46.733

.12317
.54478
45.627
4.3904
50.017

.11857
.52066
45.415
4.3881
48.512

.11863
.51038
45.524
4.3950
49.120

MEMO:

25 United States/dollar 1

I Index of weighted average exchange value of U.S. dollar against currencies of other G-10 countries plus Switzerland. March 1973 = 100.
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.




92.44

89.99

89.51

86.04

NOTE.—Averages of certified noon buying rates in N e w York for cable
transfers.

A69

Guide to
Tabular Presentation and Statistical Releases
GUIDE TO TABULAR PRESENTATION

Symbols

and

Abbreviations

p
r

e
c
n.e.c.
RPs
IPCs

Preliminary
SMSAs
Revised (Notation appears on column headREITs
ing when more than half of figures in that
*
column are changed.)
Estimated
Corrected
Not elsewhere classified
Repurchase agreements
figures
Individuals, partnerships, and corporations

General

Information

Minus signs are used to indicate (1) a decrease, (2)
a negative figure, or (3) an outflow.
" U . S . government securities" may include guaranteed issues of U . S . government agencies (the flow of
funds figures also include not fully guaranteed issues)

Standard metropolitan statistical areas
Real estate investment trusts
Amounts insignificant in terms of the particular unit ( e . g . , less than 5 0 0 , 0 0 0 when
the unit is millions)
(1) Zero, (2) no figure to be expected, or
(3) figure delayed or, (4) no change (when
are expressed in percentages).

as well as direct obligations of the Treasury. "State
and local government" also includes municipalities,
special districts, and other political subdivisions.
In some of the tables details do not add to totals
because of rounding.

STATISTICAL RELEASES

List Published

Semiannually,

with Latest

Bulletin

Reference
Issue

Anticipated schedule of release dates for individual releases




December 1978

Page

A-76

A 70

Federal Reserve Board of Governors
G.

WILLIAM

Chairman

MILLER,

HENRY

C.

OFFICE

OF BOARD

PHILIP E .

MEMBERS

OFFICE

THOMAS J. O ' C O N N E L L , Counsel
to the
Chairman
JOSEPH R . C O Y N E , Assistant
to the
Board
KENNETH A . G U E N T H E R , Assistant
to the
Board
JAY PAUL B R E N N E M A N , Special
Assistant
to the

Board
FRANK O ' B R I E N , J R . , Special

Assistant

to

the

Board
JOSEPH S . SIMS, Special
Assistant
to the
Board
D O N A L D J. W I N N , Special
Assistant
to the
Board

DIRECTOR

FOR

FINANCIAL

POLICY

the

Counsel
General

OF RESEARCH

AND

STATISTICS

Director
Division

Officer

Counsel
Counsel
General

ELEANOR J. STOCKWELL, Senior

Division
JAMES M .

Counsel

Research

Officer
B R U N D Y , Associate

Research

Division

Officer
ROBERT A . EISENBEIS, Associate

OFFICE

to

Board

JAMES L . KICHLINE,
Director
JOSEPH S . ZEISEL, Deputy
Director
JOHN H . KALCHBRENNER, Associate
JOHN J. M I N G O , Senior
Research

DIVISION

A L L E N L . RAIKEN, Associate
General
CHARLES R . M C N E I L L , Assistant
to the

AND

STEPHEN H . AXILROD, Staff
Director
EDWARD C . ETTIN, Deputy
Staff
Director
MURRAY A L T M A N N , Assistant
to the
Board
PETER M . KEIR, Assistant
to the
Board
STANLEY J. SIGEL, Assistant
to the
Board
NORMAND R . V . BERNARD, Special
Assistant

DIVISION

NEAL L . PETERSEN, General
ROBERT E . M A N N I O N , Associate

PARTEE

OF STAFF

MONETARY

LEGAL

COLDWELL

J. C H A R L E S

WALLICH

OF

THE

Division

SECRETARY

JARED J. E N Z L E R , Associate
THEODORE E . ALLISON, Secretary
GRIFFITH L . GARWOOD, Deputy Secretary
"JOHN M . WALLACE, Assistant Secretary
RICHARD H . PUCKETT, Manager, Regulatory

Improvement Project

Research

Officer
Research

J. CORTLAND G . PERET, Associate

Division

Research

Officer

MICHAEL J. PRELL, Associate

Research

OF CONSUMER

AFFAIRS

JANET O . HART,
Director
NATHANIEL E . BUTLER, Associate
JERAULD C . KLUCKMAN, Associate
A N N E GEARY, Assistant
Director

Division

Research

Officer

ROBERT M . FISHER, Assistant

Research

OF

SUPERVISION

Director
Director

FREDERICK M . STRUBLE, Assistant

Division

STEPHEN P . TAYLOR, Assistant

Division

Research

Officer
Research

Officer
Director

BANKING
AND

REGULATION

JOHN E . R Y A N ,
Director
-{•FREDERICK C . SCHADRACK, Deputy
Director
FREDERICK R . D A H L , Associate
Director
WILLIAM W . WILES, Associate
Director
JACK M . EGERTSON, Assistant
Director

DON E. KLINE, Assistant
ROBERT S . PLOTKIN, Assistant
THOMAS A . SIDMAN, Assistant
SAMUEL H . TALLEY, Assistant
WILLIAM TAYLOR, Assistant

Director
Director
Director
Director
Director

DIVISION

*On loan from the Federal Reserve Bank of Atlanta.
| O n loan from the Federal Reserve Bank of N e w York.

OF INTERNATIONAL

FINANCE

EDWIN M . T R U M A N ,
Director
ROBERT F . GEMMILL, Associate
Director
GEORGE B . H E N R Y , Associate
Director
CHARLES J. SIEGMAN, Associate
Director
SAMUEL PIZER, Senior
International
Division

Officer
JEFFREY R . SHAFER, Associate

Division
Division

International

Officer

LARRY J. PROMISEL, Assistant

International

Officer

RALPH W . SMITH, JR., Assistant

Division

International

Officer

DALE W . HENDERSON, Assistant

Division




Division

Officer

LEVON H . GARABEDIAN, Assistant
DIVISION

Division

Officer
HELMUT F . W E N D E L , Associate

DIVISION

Division

Officer

Officer

International

A 71

and Official Staff
NANCY

OFFICE
STAFF

H.

TEETERS

OF

OFFICE

DIRECTOR

FOR

MANAGEMENT

JOHN M . DENKLER, Staff
Director
ROBERT J. LAWRENCE, Deputy
Staff
JOSEPH W . DANIELS, S R . , Director
of

Employment

BANK

FOR
ACTIVITIES

WILLIAM H . W A L L A C E , Staff

DIVISION
Director

DIRECTOR

RESERVE

Director

Director
Equal

Opportunity

HARRY A . G U I N T E R , Program

Contingency

OF STAFF

FEDERAL

for

BANK

OF FEDERAL
EXAMINATIONS

RESERVE
AND

BUDGETS

Planning
ALBERT R . HAMILTON,
Director
CLYDE H . FARNSWORTH, J R . ,
Associate

DIVISION

OF DATA

PROCESSING

Director

CHARLES L . HAMPTON,
Director
BRUCE M . BEARDSLEY, Associate
Director
UYLESS D . BLACK, Assistant
Director
G L E N N L . CUMMINS, Assistant
Director
ROBERT J. ZEMEL, Assistant
Director

DIVISION

OF

PERSONNEL

DAVID L . SHANNON,
Director
JOHN R . W E I S , Assistant
Director
CHARLES W . W O O D , Assistant
Director

OFFICE OF THE

CONTROLLER

JOHN KAKALEC,
Controller
EDWARD T . M U L R E N I N , Assistant

DIVISION
DONALD
JOHN L .
WALTER
JOHN D .

OF SUPPORT

Controller

SERVICES

E. ANDERSON,Director
GRIZZARD, Associate
Director
W . KREIMANN, Associate
Director
SMITH, Assistant
Director




CHARLES W . B E N N E T T , Assistant
Director
JOHN F . HOOVER, Assistant
Director

P. D. RING, Assistant

Director

RAYMOND L . T E E D , Assistant

DIVISION

OF FEDERAL

BANK

OPERATIONS

Director

RESERVE

JAMES R . KUDLINSKI,
Director
WALTER A L T H A U S E N , Assistant
Director
BRIAN M . CAREY, Assistant
Director
HARRY A . G U I N T E R , Assistant
Director
LORIN S . MEEDER, Assistant
Director

A 72

Federal Reserve Bulletin • January 1979

FOMC and Advisory Councils
FEDERAL OPEN MARKET COMMITTEE
Chairman

G . WILLIAM MILLER,

PAUL A .

VOLCKER,

Vice

Chairman

ERNEST T . B A U G H M A N

J. C H A R L E S P A R T E E

HENRY C .

PHILIP E . C O L D W E L L

N A N C Y H . TEETERS

MARK H .

WILLES

WILLIS J.

WINN

DAVID P . EASTBURN

Secretary
Assistant
Secretary
T H O M A S J. O ' C O N N E L L , General
Counsel
E D W A R D G . G U Y , Deputy General
Counsel
R O B E R T E . M A N N I O N , Assistant General
Counsel
STEPHEN H . AXILROD,
Economist
JOSEPH B U R N S , Associate
Economist
J O H N M . D A V I S , Associate
Economist

Associate
Economist
Associate
Economist
IRA K A M I N O W , Associate
Economist
PETER M . K E I R , Associate
Economist
JAMES L . K I C H L I N E , Associate
Economist
JOHN P A U L U S , Associate
Economist
E D W I N M . T R U M A N , Associate
Economist
JOSEPH S . Z E I S E L , Associate
Economist

MURRAY ALTMANN,
NORMAND R . V .

RICHARD G .

BERNARD,

A L A N R . HOLMES,
PETER D .

WALLICH

DAVIS,

EDWARD C . ETTIN,

Manager, System Open Market Account
Deputy Manager for Domestic
Operations
Deputy Manager for Foreign Operations

S T E R N LIGHT,

SCOTT E .

PARDEE,

FEDERAL ADVISORY COUNCIL
H E N R Y S . W O O D B R I D G E , FIRST DISTRICT

ROGER E . A N D E R S O N , S E V E N T H

W A L T E R B . W R I S T O N , SECOND DISTRICT

CLARENCE C . BARKSDALE, EIGHTH

W I L L I A M B . E A G L E S O N , J R . , THIRD DISTRICT

RICHARD H .

MERLE E . GILLIAND, FOURTH

J. W .

J. O W E N C O L E , FIFTH
FRANK A .

DISTRICT

PLUMMER, SIXTH

MCLEAN, TENTH

JAMES D .

DISTRICT

DISTRICT

DISTRICT

DISTRICT

BERRY, ELEVENTH

DISTRICT

CHAUNCEY E . SCHMIDT, TWELFTH

DISTRICT
HERBERT V .

VAUGHAN, NINTH

DISTRICT

DISTRICT

Secretary
Associate
Secretary

PROCHNOW,

W I L L I A M J. K O R S V I K ,

CONSUMER ADVISORY COUNCIL
W A R R E N , LOS A t igeles, California, Chairman
A. H A K A L A , Omaha Nebraska, Vice Chairman
PERCY W. L O Y , Portland, Oregon
R O L A N D E . B R A N D E L , San Francisco, California
R. C. MORGAN, El Paso, Texas
JAMES L. B R O W N , Milwaukee, Wisconsin
M A R K E . B U D N I T Z , Boston, Massachusetts
FLORENCE M. R I C E , New York, New York
R A L P H J. R O H N E R , Washington, D . C.
JOHN G. B U L L , Fort Lauderdale, Florida
R A Y M O N D J. S A U L N I E R , New York, New York
ROBERT V. B U L L O C K , Frankfort, Kentucky
H E N R Y S . S C H E C H T E R , Washington, D . C.
C A R L F E L S E N F E L D , New York, New York
JEAN A. Fox, Pittsburgh, Pennsylvania
E. G. SCHUHART, Amarillo, Texas
BLAIR C. S H I C K , Cambridge, Massachusetts
R I C H A R D H . H O L T O N , Berkeley, California
T H O M A S R . S W A N , Portland, Maine
E D N A D E C O U R S E Y J O H N S O N , Baltimore, Maryland
A N N E G A R Y T A Y L O R , Alexandria, Virginia
RICHARD A. V A N W I N K L E , Salt Lake City, Utah
R I C H A R D F. K E R R , Cincinnati, Ohio
R I C H A R D D . W A G N E R , Simsbury, Connecticut
ROBERT J. K L E I N , New York, New York
M A R Y W. W A L K E R , Monroe, Georgia
H A R V E Y M. K U H N L E Y , Minneapolis, Minnesota




WILLIAM D .
MARCIA

A 73

Federal Reserve Banks, Branches, and Offices
FEDERAL RESERVE BANK,
branch, or facility
Zip

Chairman
Deputy Chairman

President
First Vice President

BOSTON*

02106

Robert M. Solow
Robert P. Henderson

Frank E. Morris
James A. Mcintosh

NEW YORK*

10045

Robert H. Knight
Boris Yavitz
Vacancy

Paul A. Volcker
Thomas M. Timlen

Buffalo

14240

John T. Keane

PHILADELPHIA

19105

John W. Eckman
Werner C. Brown

David P. Eastburn
Richard L. Smoot

CLEVELAND*

44101

Willis J. Winn
Walter H. MacDonald

Cincinnati
Pittsburgh

45201
15230

Robert E. Kirby
Arnold R. Weber
Lawrence H. Rogers, II
G. Jackson Tankersley

RICHMOND*

23261

E. Angus Powell
Maceo A. Sloan
I. E. Killian
Vacancy

Robert P. Black
George C. Rankin

Baltimore
21203
Charlotte
28230
Culpeper Communications
and Records Center . 22701
ATLANTA
Birmingham
Jacksonville
Miami
Nashville
New Orleans

30303
35202
32203
33152
37203
70161

CHICAGO*

60690

Detroit

48231

ST. LOUIS

63166

Little Rock
Louisville
Memphis

72203
40201
38101

MINNEAPOLIS

55480

Helena
KANSAS CITY
Denver
Oklahoma City
Omaha
DALLAS
El Paso
Houston
San Antonio

59601
64198
80217
73125
68102
75222
79999
77001
78295

SAN FRANCISCO

94120

Los Angeles
Portland
Salt Lake City
Seattle

90051
97208
84125
98124

Vice President
in charge of branch

Robert E. Showalter
Robert D. Duggan

Jimmie R. Monhollon
Stuart P. Fishburne
Albert D. Tinkelenberg

Clifford M. Kirtland, Jr.
William A. Fickling, Jr.
Harold B. Blach, Jr.
Vacancy
Vacancy
John C. Bolinger
Vacancy

Monroe Kimbrel
Kyle K. Fossum

Robert H. Strotz
John Sagan
Jordan B. Tatter

Robert P. Mayo
Daniel M. Doyle

Armand C. Stalnaker
William B. Walton
G. Larry Kelley
Vacancy
Vacancy

Lawrence K. Roos
Donald W. Moriarty

Stephen F. Keating
William G. Phillips
Patricia P. Douglas

Mark H. Willes
Thomas E. Gainor

Harold W. Andersen
Joseph H. Williams
A. L. Feldman
Christine H. Anthony
Durward B. Varner

Roger Guffey
Henry R. Czerwinski

Irving A. Mathews
Gerald D. Hines
A. J. Losee
Gene M. Woodfin
Pat Legan

Ernest T. Baughman
Robert H. Boykin

Joseph F. Alibrandi
Cornell C. Maier
Caroline L. Ahmanson
Loran L. Stewart
Wendell J. Ashton
Lloyd E. Cooney

John J. Balles
John B. Williams

Hiram J. Honea
Charles B. East
F. J. Craven, Jr.
Jeffrey J. Wells
George C. Guynn

William C. Conrad

John F. Breen
Donald L. Henry
L. Terry Britt

John D. Johnson

Wayne W. Martin
William G. Evans
Robert D. Hamilton

Fredric W. Reed
J. Z. Rowe
Carl H. Moore

Richard C. Dunn
Angelo S. Carella
A. Grant Holman
Gerald R. Kelly

* Additional offices of these Banks are located at Lewiston, Maine 04240; Windsor Locks, Connecticut 0 6 0 9 6 ; Cranford,
New Jersey 0 7 0 1 6 ; Jericho, New York 11753; Utica at Oriskany, N e w York 13424; Columbus, Ohio 4 3 2 1 6 ; Columbia, South
Carolina 29210; Charleston, West Virginia 25311; Des Moines, Iowa 50306; Indianapolis, Indiana 46204; and Milwaukee,
Wisconsin 53202.




A 74

Federal Reserve Board Publications
Available from Publications Services, Division of Administrative Services, Board of Governors of the Federal Reserve System, Washington, D.C. 20551.
Where
a charge is indicated,
remittance should
accompany

request and be made payable to the order of the Board
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Remittance from foreign residents should be drawn on a U.S.
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THE

B A N K CREDIT-CARD AND CHECK-CREDIT P L A N S .

FEDERAL
RESERVE
SYSTEM—PURPOSES
FUNCTIONS. 1 9 7 4 . 1 2 5 p p .

AND

A N N U A L REPORT

SURVEY OF CHANGES IN FAMILY FINANCES.

FEDERAL RESERVE B U L L E T I N .

Monthly.

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BANKING

AND

MONETARY

STATISTICS,

1914-1941.

AND

MONETARY

STATISTICS,

1941-1970.

1976. 1,168 pp. $15.00.
A N N U A L STATISTICAL DIGEST, 1 9 7 1 - 7 5 . 1 9 7 6 . 3 3 9 p p .

$ 4 . 0 0 per copy for each paid subscription to Federal Reserve Bulletin. All others, $ 5 . 0 0 each.
A N N U A L STATISTICAL DIGEST, 1 9 7 2 - 7 6 .

1977. 3 8 8 pp.

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1978. 361 pp.

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CAPITAL MARKET DEVELOPMENTS. W e e k l y . $ 1 5 . 0 0 p e r

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SELECTED INTEREST AND EXCHANGE R A T E S — W E E K L Y
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THE FEDERAL RESERVE ACT, as a m e n d e d through D e -

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REGULATIONS OF THE BOARD OF GOVERNORS OF THE
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PUBLISHED INTERPRETATIONS OF THE BOARD OF G O V -

ERNORS, as of June 30, 1978. $7.50.
EDITION.

1977.

304

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321

REPORT OF THE JOINT TREASURY-FEDERAL RESERVE
STUDY OF THE U . S . GOVERNMENT SECURITIES

MARKET. ,1969. 4 8 p p . $ . 2 5 e a c h ; 10 or m o r e to

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IES—PART 1. 1970. 86 pp. $ . 5 0 each; 10 or more
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O P E N MARKET POLICIES AND OPERATING PROCED U R E S — S T A F F STUDIES.
1971. 2 1 8 pp.
$2.00

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A N N U A L STATISTICAL DIGEST, 1 9 7 3 - 7 7 .

INDUSTRIAL P R O D U C T I O N — 1 9 7 6

1968.

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JOINT TREASURY-FEDERAL RESERVE S T U D Y OF THE
GOVERNMENT SECURITIES MARKET: STAFF S T U D -

(Reprint of Part 1 only) 1976. 682 pp. $5.00.
BANKING

1968.

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$.85 each.

REAPPRAISAL OF THE FEDERAL RESERVE DISCOUNT
MECHANISM. Vol. 1. 1 9 7 1 . 2 7 6 p p . Vol. 2 . 1 9 7 1 .

173 pp. Vol. 3. 1972. 220 pp. Each volume $3.00;
10 or more to one address, $ 2 . 5 0 each.
T H E ECONOMETRICS OF PRICE DETERMINATION

CON-

FERENCE, October 30-31, 1970, Washington, D . C .
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10 or more to one address, $ 3 . 6 0 each.
FEDERAL RESERVE STAFF S T U D Y : W A Y S TO MODERATE
FLUCTUATIONS
IN
HOUSING
CONSTRUCTION .

1972. 487 pp. $ 4 . 0 0 each; 10 or more to one
address, $3.60 each.
LENDING

FUNCTIONS

OF

THE

FEDERAL

RESERVE

BANKS. 1973. 271 pp. $ 3 . 5 0 each; 10 or more
to one address, $ 3 . 0 0 each.
IMPROVING THE MONETARY AGGREGATES ( R e p o r t o f t h e

Advisory Committee on Monetary Statistics).
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A N N U A L PERCENTAGE R A T E TABLES ( T r u t h in

Lend-

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1969. 116 pp. Each volume $1.00, 10 or more
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FEDERAL RESERVE MEASURES OF CAPACITY AND C A PACITY UTILIZATION. 1 9 7 8 . 4 0 p p . $ 1 . 7 5 e a c h ,

10 or more to one address, $1.50. each.
T H E B A N K HOLDING COMPANY MOVEMENT TO 1 9 7 8 :
A COMPENDIUM. 1 9 7 8 . 2 8 9 p p . $ 2 . 5 0 e a c h , 1 0

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IMPROVING

THE

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AGGREGATES:

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PAPERS. 1978. 170 pp. $4.00 each, 10 or more
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1 9 7 7 CONSUMER CREDIT SURVEY. 1 9 7 8 . 1 1 9 p p .

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$2.00

Federal

CONSUMER EDUCATION PAMPHLETS
use.

Multiple

CONSUMER HANDBOOK TO CREDIT PROTECTION LAWS
T H E EQUAL CREDIT OPPORTUNITY A C T AND . . . A G E
T H E EQUAL CREDIT OPPORTUNITY A C T AND .
CREDIT RIGHTS IN HOUSING
THE EQUAL CREDIT OPPORTUNITY A C T AND . . .
DOCTORS, LAWYERS, SMALL RETAILERS,
AND
OTHERS W H O M A Y PROVIDE INCIDENTAL CREDIT
THE EQUAL CREDIT OPPORTUNITY ACT AND .
WOMEN
FAIR CREDIT BILLING
A G U I D E TO FEDERAL RESERVE REGULATIONS
HOW TO FILE A CONSUMER CREDIT COMPLAINT
IF Y O U BORROW TO B U Y STOCK
IF Y O U USE A CREDIT CARD
TRUTH IN LEASING
U . S . CURRENCY

W H A T TRUTH IN LENDING M E A N S TO Y O U

Studies and papers on economic and financial
that are of general interest in the field of
research.

Only Printed

in the

(Limited supply of mimeographed
available upon request for single

subjects
economic

Bulletin

copies
copies.)

of full text

STRUCTURE AND PERFORMANCE STUDIES IN BANKING:
A SUMMARY AND EVALUATION, b y S t e p h e n A .

Rhoades. Dec. 1977. 4 5 pp.
A N ANALYSIS OF FEDERAL RESERVE ATTRITION SINCE

1960, by John T. Rose. Jan. 1978. 4 4 pp.
PROBLEMS IN APPLYING DISCRIMINANT ANALYSIS IN
CREDIT SCORING MODELS, b y R o b e r t A . E i s e n b e i s .

Jan. 1978. 28 pp.
CAPITAL

FINANCING

REQUIREMENTS

OF

COMMERCIAL BANKS: 1977-81, by Gerald A. Hanweck and John J. Mingo. Feb. 1978. 34 pp.
MORTGAGE BORROWING AGAINST EQUITY IN EXISTING
HOMES: MEASUREMENT, GENERATION, AND IMPLICATIONS FOR ECONOMIC ACTIVITY, b y D a v i d F .

Seiders. May 1978. 4 2 pp.
T H E BEHAVIOR OF MEMBER B A N K REQUIRED RESERVE
RATIOS AND THE EFFECTS OF BOARD ACTION,

1 9 6 8 - 7 7 , by Thomas D . Simpson. July 1978. 39
pp.
FOOTHOLD ACQUISITIONS AND B A N K MARKET STRUC-

TURE, by Stephen A. Rhoades and Paul Schweitzer, July 1978. 8 pp.
INTEREST RATE CEILINGS AND DISINTERMEDIATION, b y

Edward F. McKelvey. Sept. 1978. 105 pp.
THE RELATIONSHIP BETWEEN RESERVE RATIOS AND
THE MONETARY AGGREGATES UNDER RESERVES
AND FEDERAL F U N D S RATE OPERATING TARGETS,

by Kenneth J. Kopecky. Dec. 1978. 58 pp.

Printed

in Full in the

Staff Economic

Studies




Publications

A 75

(Except for Staff Papers, Staff Economic
some leading articles, most of the articles
not exceed 12 pages.)

Studies, and
reprinted do

MEASURES OF SECURITY CREDIT. 1 2 / 7 0 .
REVISION OF B A N K CREDIT SERIES. 1 2 / 7 1 .
ASSETS AND LIABILITIES OF FOREIGN BRANCHES OF
U . S . BANKS. 2 / 7 2 .
B A N K DEBITS, DEPOSITS, AND DEPOSIT T U R N O V E R —
REVISED SERIES. 7 / 7 2 .
YIELDS ON N E W L Y ISSUED CORPORATE B O N D S . 9 / 7 2 .
RECENT ACTIVITIES OF FOREIGN BRANCHES OF U . S .
BANKS. 1 0 / 7 2 .
REVISION OF CONSUMER CREDIT STATISTICS. 1 0 / 7 2 .
O N E - B A N K HOLDING COMPANIES BEFORE THE 1 9 7 0
AMENDMENTS. 1 2 / 7 2 .
YIELDS ON RECENTLY OFFERED CORPORATE B O N D S .
5/73.
RATES ON CONSUMER INSTALMENT L O A N S . 9 / 7 3 .
N E W SERIES FOR LARGE MANUFACTURING CORPORATIONS. 1 0 / 7 3 .
U . S . ENERGY SUPPLIES AND USES', Staff
Economic

Study by Clayton Gehman. 12/73.

STAFF ECONOMIC STUDIES

EXTERNAL

Board

REPRINTS

(Short pamphlets suitable for classroom
copies available without
charge.)

Summaries

Reserve

Bulletin

shown

under

"Reprints."

T H E STRUCTURE OF MARGIN CREDIT. 4 / 7 5 .
N E W STATISTICAL SERIES ON L O A N COMMITMENTS AT
SELECTED LARGE COMMERCIAL B A N K S . 4 / 7 5 .
RECENT TRENDS IN FEDERAL B U D G E T POLICY. 7 / 7 5 .
RECENT DEVELOPMENTS IN INTERNATIONAL FINANCIAL
MARKETS. 1 0 / 7 5 .
M I N N I E : A SMALL VERSION OF THE M I T - P E N N - S S R C

ECONOMETRIC MODEL, Staff Economic Study by
Douglas Battenberg, Jared J. Enzler, and Arthur
M. Havenner. 11/75.
A N ASSESSMENT OF B A N K HOLDING COMPANIES,

Staff

Economic Study by Robert J. Lawrence and Samuel H. Talley. 1/76.
INDUSTRIAL ELECTRIC POWER U S E . 1 / 7 6 .
REVISION OF M O N E Y STOCK MEASURES. 2 / 7 6 .
SURVEY OF FINANCE COMPANIES, 1 9 7 5 . 3 / 7 6 .
REVISED SERIES FOR MEMBER B A N K DEPOSITS
AGGREGATE RESERVES. 4 / 7 6 .

AND

INDUSTRIAL P R O D U C T I O N — 1 9 7 6 R e v i s i o n . 6 / 7 6 .
FEDERAL RESERVE OPERATIONS IN PAYMENT M E C H A NISMS: A SUMMARY. 6 / 7 6 .
RECENT GROWTH IN ACTIVITIES OF U . S . OFFICES OF
BANKS. 1 0 / 7 6 .
N E W ESTIMATES OF CAPACITY UTILIZATION: M A N U FACTURING AND MATERIALS. 1 1 / 7 6 .
B A N K HOLDING COMPANY FINANCIAL DEVELOPMENTS
IN 1 9 7 6 . 4 / 7 7 .
SURVEY OF TERMS OF B A N K L E N D I N G — N E W SERIES.
5/77.
T H E COMMERCIAL PAPER M A R K E T . 6 / 7 7 .
CONSUMPTION AND FIXED INVESTMENT IN THE ECONOMIC RECOVERY ABROAD. 1 0 / 7 7 .
RECENT DEVELOPMENTS IN
TRANSACTIONS. 4 / 7 8 .

U.S.

INTERNATIONAL

T H E FEDERAL B U D G E T IN THE 1 9 7 0 ' S . 9 / 7 8 .
SUMMARY MEASURES OF THE DOLLAR'S FOREIGN E X CHANGE V A L U E . 1 0 / 7 8 .
SURVEY OF TIME AND SAVINGS DEPOSITS AT A L L COMMERCIAL B A N K S , JULY 1 9 7 8 . 1 1 / 7 8 .
REDEFINING THE MONETARY AGGREGATES. 1 / 7 9 .

A76

Index to Statistical Tables
References

are to pages

A-3 through

A-68

although

ACCEPTANCES, bankers, 11, 25, 27
Agricultural loans, commercial banks, 18, 2 0 - 2 2 , 26
Assets and liabilities (See also Foreigners):
Banks, by classes, 16, 17, 18, 2 0 - 2 3 , 29
Domestic finance companies, 39
Federal Reserve Banks, 12
Nonfinancial corporations, current, 38
Automobiles:
Consumer instalment credit, 42, 43
Production, 48, 49
BANKERS balances, 16, 18, 20, 21, 22
(See also Foreigners)
Banks for cooperatives, 35
Bonds (See also U . S . Govt, securities):
New issues, 36
Yields, 3
Branch banks:
Assets and liabilities of foreign branches of U . S .
banks, 56
Liabilities of U . S . banks to their foreign
branches, 23
Business activity, 46
Business expenditures on new plant and
equipment, 38
Business loans (See Commercial and industrial
loans)
CAPACITY utilization, 46
Capital accounts:
Banks, by classes, 16, 17, 19, 20
Federal Reserve Banks, 12
Central banks, 68
Certificates of deposit, 23, 27
Commercial and industrial loans:
Commercial banks, 15, 18, 23, 26
Weekly reporting banks, 20, 21, 22, 23, 24
Commercial banks:
Assets and liabilities, 3, 15-19, 2 0 - 2 3
Business loans, 26
Commercial and industrial loans, 24, 26
Consumer loans held, by type, 42, 43
Loans sold outright, 23
Number, by classes, 16, 17, 19
Real estate mortgages held, by type of holder and
property, 41
Commercial paper, 3, 24, 25, 27, 39
Condition statements (See Assets and liabilities)
Construction, 46, 50
Consumer instalment credit, 42, 43
Consumer prices, 46, 51
Consumption expenditures, 52, 53
Corporations:
Profits, taxes, and dividends, 37
Security issues, 36, 65
Cost of living (See Consumer prices)
Credit unions, 29, 42, 43
Currency and coin, 5, 16, 18
Currency in circulation, 4, 14
Customer credit, stock market, 28
DEBITS to deposit accounts, 13
Debt (See specific types of debt or




securities)

the prefix

"A"

is omitted

in this

index

Demand deposits:
Adjusted, commercial banks, 13, 15, 19
Banks, by classes, 16, 17, 19, 2 0 - 2 3
Ownership by individuals, partnerships, and
corporations, 25
Subject to reserve requirements, 15
Turnover, 13
Deposits (See also specific types of deposits):
Banks, by classes, 3, 16, 17, 19, 2 0 - 2 3 , 29
Federal Reserve Banks, 4, 12
Subject to reserve requirements, 15
Turnover, 13
Discount rates at F.R. Banks (See Interest rates)
Discounts and advances by F.R. Banks (See Loans)
Dividends, corporate, 37
EMPLOYMENT, 46, 47
Euro-dollars, 27
FARM mortgage loans, 41
Farmers Home Administration, 41
Federal agency obligations, 4, 11, 12, 13, 34
Federal and Federally sponsored credit agencies, 35
Federal finance:
Debt subject to statutory limitation and
types and ownership of gross debt, 32
Receipts and outlays, 30, 31
Treasury operating balance, 30
Federal Financing Bank, 30, 35
Federal funds, 3, 6, 18, 20, 21, 22, 27, 30
Federal home loan banks, 35
Federal Home Loan Mortgage Corp., 35, 40, 41
Federal Housing Administration, 35, 40, 41
Federal intermediate credit banks, 35
Federal land banks, 35, 41
Federal National Mortgage Assn., 35, 40, 41
Federal Reserve Banks:
Condition statement, 12
Discount rates (See Interest rates)
U . S . Govt, securities held, 4, 12, 13, 32, 33
Federal Reserve credit, 4, 5, 12, 13
Federal Reserve notes, 12
Federally sponsored credit agencies, 35
Finance companies:
Assets and liabilities, 39
Business credit, 39
Loans, 20, 21, 22, 42, 43
Paper, 25, 27
Financial institutions, loans to, 18, 2 0 - 2 2
Float, 4
Flow of funds, 44, 45
Foreign:
Currency operations, 12
Deposits in U . S . banks, 4, 12, 19, 20, 21, 22
Exchange rates, 68
Trade, 55
Foreigners:
Claims on, 60, 61, 66, 67
Liabilities to, 23, 5 6 - 5 9 , 6 4 - 6 7
GOLD.
Certificates, 12
Stock, 4, 55
Government National Mortgage Assn., 35, 40, 41
Gross national product, 52, 53

A165Federal Reserve Bulletin • January 1979

HOUSING, new and existing units, 50
INCOME, personal and national, 46, 52, 53
Industrial production, 46, 48
Instalment loans, 42, 43
Insurance companies, 29, 32, 33, 41
Insured commercial banks, 17, 18, 19
Interbank deposits, 16, 17, 20, 21, 22
Interest rates:
Bonds, 3
Business loans of banks, 26
Federal Reserve Banks, 3, 8
Foreign countries, 68
Money and capital markets, 3, 27
Mortgages, 3, 40
Prime rate, commercial banks, 26
Time and savings deposits, maximum rates, 10
International capital transactions of the United
States, 5 6 - 6 7
International organizations, 5 6 - 6 1 , 6 4 - 6 7
Inventories, 52
Investment companies, issues and assets, 37
Investments (See also specific types of investments):
Banks, by classes, 16, 17, 18, 20, 21, 22, 29
Commercial banks, 3, 15, 16, 17, 18
Federal Reserve Banks, 12, 13
Life insurance companies, 29
Savings and loan assns., 29
LABOR force, 47
Life insurance companies (See Insurance companies)
Loans (See also specific types of loans):
Banks, by classes, 16, 17, 18, 2 0 - 2 3 , 29
Commercial banks, 3, 15-18, 2 0 - 2 3 , 24, 26
Federal Reserve Banks, 3, 4, 5, 8, 12, 13
Insurance companies, 29, 41
Insured or guaranteed by U . S . , 40, 41
Savings and loan assns., 29
MANUFACTURING:
Capacity utilization, 46
Production, 46, 49
Margin requirements, 10
Member banks:
Assets and liabilities, by classes, 16, 17, 18
Borrowings at Federal Reserve Banks, 5, 12
Number, by classes, 16, 17, 19
Reserve position, basic, 6
Reserve requirements, 9
Reserves and related items, 3, 4, 5, 15
Mining production, 49
Mobile home shipments, 50
Monetary aggregates, 3, 15
Money and capital market rates (See Interest rates)
Money stock measures and components, 3, 14
Mortgages (See Real estate loans)
Mutual funds (See Investment companies)
Mutual savings banks, 3, 10, 2 0 - 2 2 , 29, 32, 33, 41
NATIONAL banks, 17, 19
National defense outlays, 31
National income, 52
Nonmember banks, 17, 18, 19
OPEN market transactions, 11
PERSONAL income, 53
Prices:
Consumer and wholesale, 46, 51
Stock market, 28
Prime rate, commercial banks, 26
Production, 46, 48
Profits, corporate, 37




REAL estate loans:
Banks, by classes, 18, 2 0 - 2 3 , 29, 41
Life insurance companies, 29
Mortgage terms, yields, and activity, 3, 40
Type of holder and property mortgaged, 41
Reserve position, basic, member banks, 6
Reserve requirements, member banks, 9
Reserves:
Commercial banks, 16, 18, 20, 21, 22
Federal Reserve Banks, 12
Member banks, 3, 4, 5, 15, 16, 18
U.S. reserve assets, 55
Residential mortgage loans, 40
Retail credit and retail sales, 42, 43, 46
SAVING:
Flow of funds, 44, 45
National income accounts, 53
Savings and loan assns., 3, 10, 29, 33, 41, 44
Savings deposits (See Time deposits)
Savings institutions, selected assets, 29
Securities (See also U . S . Govt, securities):
Federal and Federally sponsored agencies, 35
Foreign transactions, 65
New issues, 36
Prices, 28
Special Drawing Rights, 4, 12, 54, 55
State and local govts.:
Deposits, 19, 20, 21, 22
Holdings of U.S. Govt, securities, 32, 33
New security issues, 36
Ownership of securities of, 18, 20, 21, 22, 29
Yields of securities, 3
State member banks, 17
Stock market, 28
Stocks (See also Securities):
New issues, 36
Prices, 28
TAX receipts, Federal, 31
Time deposits, 3, 10, 13, 15, 16, 17, 19, 20, 21,
22, 23
Trade, foreign, 55
Treasury currency, Treasury cash, 4
Treasury deposits, 4, 12, 30
Treasury operating balance, 30
UNEMPLOYMENT, 47
U.S. balance of payments, 54
U.S. Govt, balances:
Commercial bank holdings, 19, 20, 21, 22
Member bank holdings, 15
Treasury deposits at Reserve Banks, 4, 12, 30
U.S. Govt, securities:
Bank holdings, 16, 17, 18, 20, 21, 22, 29,
32, 33
Dealer transactions, positions, and financing, 34
Federal Reserve Bank holdings, 4, 12, 13, 32, 33
Foreign and international holdings and
transactions, 12, 32, 64
Open market transactions, 11
Outstanding, by type of security, 32, 33
Ownership, 32, 33
Rates in money and capital markets, 3, 27
Yields, 3
Utilities, production, 49
VETERANS Administration, 40, 41
WEEKLY reporting banks, 2 0 - 2 4
Wholesale prices, 46
YIELDS (See Interest rates)

A78

The Federal Reserve System
Boundaries of Federal Reserve Districts and Their Branch Territories

Minneapolis
Detroit

Chicago
jSalt Lake

Omaha*

City
Denver

Kansas

\s)

City

.

t. Louis

Louisville
fichjn?5
'harlottej

IOklahoma
ls

^mphisNashvM

City.

Angeles
,ittle Rock

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Atlanta

>

Dallas®
7

lPas~o
Ja< kson
Houston
San

Antonio

January 1978

ALASKA

LEGEND

—

Q

Boundaries of Federal Reserve Districts

®

Federal Reserve Bank Cities

Boundaries of Federal Reserve Branch
Territories

•

Federal Reserve Branch Cities

Board of Governors of the Federal
Reserve System




Federal Reserve Bank Facility