Full text of H.16 Capital Market Developments : August 22, 1960

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AUG 2 ^ 9 6 0 ° " T 1 C a t l ° " 1 ) E C O y n i O I M ) A i m SIX MOUTHS .
August 22, i960

FEDERAL REsBatife BANK
f^pTTAT. MABTTRff DEVELOPMENTS
IN THE UNITED STATES AND CANADA
P a r t I - United S t a t e s

(Including Monthly Review of Sources and
Uses of Funds of Financial I n t e r m e d i a r i e s )
The s a l e of l a r g e p u b l i c s e c u r i t y o f f e r i n g s f o r new c a p i t a l
t o t a l e d $185 m i l l i o n f o r corporations (including a | l 5 0 m i l l i o n GMAJ5
i s s u e ) and $1$ m i l l i o n f o r - S t a t e and l o c a l governments during t h e week
ending August 19. The S t a t e and l o c a l government o f f e r i n g was sold
by the Sta te of C a l i f o r n i a a t a n e t i n t e r e s t cost of 3»31 per c e n t .
This i s s u e was o r i g i n a l l y o f f e r e d f o r s a l e i n l a t e June, but a b i d naming a n e t i n t e r e s t cost of ii.02 p e r cent was r e j e c t e d a t t h a t time.
The calendar f o r t h i s week includes l a r g e corporate i s s u e s
with aggregate proceeds of $75 m i l l i o n . S t a t e and l o c a l government
i s s u e s t o t a l i n g $78 m i l l i o n a r e a l s o scheduled f o r s a l e .
Long-term bond y i e l d s
Yields on seasoned corporate and
S tate and l o c a l government bonds declined l a s t week, while those on
U. S. Government o b l i g a t i o n s i n c r e a s e d s l i g h t l y . The d e c l i n e was
p a r t i c u l a r l y sharp f o r S t a t e and l o c a l government bonds with y i e l d s
on Aaa-rated bonds reaching t h e lowest l e v e l s i n c e the summer of 1958.
Short-and intermediate-term i n t e r e s t r a t e s - Yields on Treasury
b i l l s and i n t e r m e d i a t e - t e r n Government i s s u e s increased l a s t week.
Other major money market r a t e s remained s t a b l e .
Stock p r i c e s - Stock p r i c e s , as measured by Standard and P o o r ' s
index of 500 common stocks, increased s l i g h t l y l a s t week, closing a t
57.01 on August 19. Trading a c t i v i t y declined with t h e d a i l y volume
averaging 2.7 m i l l i o n shares a day.
Stock market c r e d i t - Total customer c r e d i t i n t h e stock
market, excluding borrowing on U. S. Government s e c u r i t i e s , declined
i n J u l y , o f f s e t t i n g t h e increase a month e a r l i e r . The d e c l i n e l a s t
month was l a r g e l y i n n e t d e b i t balances, a s bank loans to o t h e r s than
brokers and d e a l e r s changed l i t t l e . Totaling $l*.l b i l l i o n a t t h e end
of J u l y , stock market c r e d i t i s now 11 per cent lower than a t the end
of July 1959» with the percentage decline being about t h e same f o r b o t h
net d e b i t balances and bank loans t o " o t h e r s . "
Borrowing by member firms of t h e New York Stock Exchange
maintaining margin accounts, excluding borrowing on U. S. Government
s e c u r i t i e s , continued to d e c l i n e in July and t o t a l e d $2.0 b i l l i o n a t




the end of the month. Customers' net f r e e c r e d i t balances changed
l i t t l e l a s t month. These and other data f o r July and June are shown
in the following t a b l e .
End of month
July
1 June
Customer c r e d i t
Excluding U. S. Government s e c u r i t i e s - t o t a l
Net debit balances
Bank loans t o "others"
Net debit balances secured by U. S. Govt, s e c u r i t i e s
Bank loans to "others" f o r purchasing or carrying U. S.
Government s e c u r i t i e s
Broker and dealer c r e d i t
Money borrowed except on U. S. Government s e c u r i t i e s
On customer c o l l a t e r a l
Money borrowed on U. S. Government s e c u r i t i e s
Customers' net f r e e c r e d i t balances

(Millions of d o l l a r s )
1,133
3,00k .
1,129
110

h,ZLk
3,082
1,132
106

135

135

Z,0k2
1,801
187
1,018

2,110
1,832
162
1,016

Housing s t a r t s - Private housing s t a r t s i n farm and nonfarm
areas in July declined t o a seasonally adjusted annual r a t e of 1,173,000,
according t o preliminary Census Bureau estimates. The r a t e f o r May has
been revised up s l i g h t l y , and f o r June down moderately, so t h a t generally
there now appears to have been a f a i r l y steady decline since February i n
the seasonally adjusted annual r a t e .
I n s t i t u t i o n a l i n v e s t o r s - Total savings inflow during June a t
t h r e e major f i n a n c i a l i n s t i t u t i o n s — l i f e insurance companies, savings
and loan associations and mutual savings banks—was s l i g h t l y l a r g e r than
a year e a r l i e r . The increased growth a t savings and loan associations
and mutual savings banks more than o f f s e t the decline i n the growth of
l i f e insurance company a s s e t s .
For the f i r s t s i x months of t h i s year combined growth a t these
t h r e e i n s t i t u t i o n s t o t a l e d #6.9 b i l l i o n , s l i g h t l y l e s s than i n the
comparable months of 1959. Savings and loan a s s o c i a t i o n s were the only
type of i n s t i t u t i o n experiencing an increased growth t h i s year. The
increase in l i f e insurance company a s s e t s was s l i g h t l y l e s s than l a s t
year, and t h e increase in deposits a t mutual savings banks was only a
l i t t l e more than one-half as l a r g e as i n the January-June period of 1959.
(The increase in time deposits a t commercial banks has also been smaller
than l a s t year even though t h e increase in June was much l a r g e r than i n
June 1959.)




;

Change

-81
-78
-3
+h
—

-68
-31
+25
+2

h
i
V
rV1

&

-3"
Sources and Uses of Funds of Major Types of Savings I n s t i t u t i o n s 1 /
F i r s t Half 1953-1960
( I n m i l l i o n s of d o l l a r s )
1
Year

Uses of funds
U. S. BusiState &
Govt. n e s s Mortl o c a l Other
cash s e c u r - s e c u r - gages
govt. a s s e t s
sec.
ities ities

Total
Orjii YiApfi
OUL14
WCO

Sources of funds
Net change
i n d e p o s i t s BorrowOther
or savings
ing
capital

L i f e Insurance Companies
I960 - l i l t
1959 -163
-81*
1958
1957 -137
1956 -178
1955 -136
195k -12 b
1953 -191

-289
61*
1*6
-207
-625
25
-1*21*
-165

81*7
1,339
1,191
1,096
1,01*8
968
1,135
1,502

1,332
802
790
1,190
1,059
1,556
1,109
976

IW
300
163
59
11*9
121*
363
69

838
502
669
570
363
365
692
178

2,751
2,8Wt
2,775
2,571
2,616
2,902
2,751
2,369

—

—

—

Savings and Loan Associations
i960
1959
1958
1957
1956
1955
I951i
1953

$0
-237
606
-60
-27
-12
311
1*1*

103591*
156
31*7
301*
256
36
210

i960
1959
1958
1957
1956
1955
1954
1953

11
-96
29
-1*9
-1*8
-37
1*
-51

-325
95
-163
-108
-I63
-73
-167
1*2

—

3, a ?
3,721
2,279
2,105
2,191
2,878
1,835
1,703

n.a.
n.a.
n.a.
n.a.
n.a.
n.a.
n.a.

267
1*62
185
JL1O8
300
182
130
110

3,667
3,226
2,798
2,762
3,30k
2,312
2,061*

3,6537
3,1*85
3,125
2.,578
2,656
2,603
2,282
1,91*5

-1*55
231
-31*1*
—166
-279
301
-211*
-llj6

1*3,8
821*
1*1*5
386
385 .
1*00
21*1*
265

Mutual Savings Banks
76
891*
15
980
525
996
1*02
721
116 1,11*7
-38 1,155
226
933
285
726

-25
39
1*2
10
30
56
125
53

58
62
70
58
65
to
61*
1*1*

689
1,096
1,1*99
1,031*
1,11*7
1,196 '
1,185
1,100

n.a.—Not a v a i l a b l e .
1 / For d e s c r i p t i o n of data see E x h i b i t s J , K and L.
2 / Includes Federal Home Loan Bank advances only.




1*80
885
1,293
876
997
975
1,01*2
1,007

—

209
211
206
158
150
130
11*3
93

-hThe n e t i n c r e a s e i n l i f e insurance company a s s e t s t o t a l e d $2.8
b i l l i o n i n the f i r s t h a l f , 3 per cent l e s s than a year e a r l i e r . Net
a c q u i s i t i o n of mortgages, amounting t o $1.3 b i l l i o n , was t w o - t h i r d s
l a r g e r t h i s y e a r than l a s t . In c o n t r a s t , a c q u i s i t i o n of business s e c u r i t i e s , t o t a l i n g $.8 b i l l i o n , was more than o n e - t h i r d smaller. There
was a s u b s t a n t i a l l i q u i d a t i o n of U. S. Government s e c u r i t i e s by these
companies i n c o n t r a s t with a s l i g h t n e t a c q u i s i t i o n l a s t y e a r . Net
purchases of S t a t e and l o c a l government s e c u r i t i e s were only about
h a l f as much as a year e a r l i e r . The increase i n holdings of these
s e c u r i t i e s had been s u b s t a n t i a l l a s t y e a r probably r e f l e c t i n g t h e volume
of very l a r g e revenue bond i s s u e s sold by S t a t e and l o c a l governmental
u n i t s . The i n c r e a s e i n p o l i c y loans (included i n other a s s e t s ) was
f o u r - f i f t h s l a r g e r than i n the f i r s t half l a s t y e a r .
The growth i n savings c a p i t a l a t savings and loan a s s o c i a t i o n s
was $3.7 b i l l i o n during t h e f i r s t s i x months, 6 p e r cent l a r g e r than
l a s t y e a r . Except i n A p r i l , t h e i n c r e a s e in share c a p i t a l has been
l a r g e r in each month t h i s year than i n corresponding month of 1959 and
the i n c r e a s e f o r June was a record $1.2 b i l l i o n . This y e a r , however,
t h e s e a s s o c i a t i o n s made very l a r g e repayments of borrowed f u n d s , p r i n c i p a l l y
t o t h e Federal Home Loan Banks, i n c o n t r a s t with s u b s t a n t i a l borrowing
l a s t y e a r ; i n 1959 a f t e r March, t h e s e a s s o c i a t i o n s had borrowed in record
amounts in addition t o drawing down t h e i r cash balances t o supplement
t h e i r savings inflow in order to c a r r y out t h e i r heavy mortgage lending
a c t i v i t y . Net a c q u i s i t i o n of mortgages t o t a l e d $3.2 b i l l i o n during the
f i r s t half t h i s year, one-seventh smaller than i n 1959. Net purchases
of U. S. Government s e c u r i t i e s were only o n e - s i x t h as l a r g e as i n t h e
f i r s t s i x months l a s t y e a r .
Deposits a t mutual savings banks i n t h e f i r s t h a l f increased
$.5 b i l l i o n , only about half as much a s l a s t y e a r . March and June a r e
the only months thus f a r t h i s y e a r i n which d e p o s i t s have increased more
than in the comparable period of 1959. Net a c q u i s i t i o n of mortgages
was only one-tenth s n a i l e r than i n t h e f i r s t half l a s t y e a r , but t h e r e
was a heavy l i q u i d a t i o n of U. S. Government s e c u r i t i e s t h i s y e a r in
c o n t r a s t with a modest a c q u i s i t i o n l a s t y e a r . Net purchases of business
s e c u r i t i e s , although s t i l l very ana 11, were much l a r g e r than a y e a r
earlier.
More d e t a i l e d information concerning r e c e n t c a p i t a l market
developments i s presented in t h e a t t a c h e d e x h i b i t s .
Developments i n t h e Canadian c a p i t a l markets are presented i n
P a r t I I a t the end of t h i s r e p o r t .
Capital Markets Section,
Division of Research and S t a t i s t i c s ,
Board of Governors of the Federal Reserve System.




LONG-TERM

BOND

YIELDS

HIGH-GRADE

f

LOWER-GRADE




MU . S .

1

GOVERNMENT

11. lit

-7-

Exhibit B - Tables f o r Exhibit A
Long-term Bond Yields
High-grade
Date

Corporate
Aaa 1/

U. S. Govt,
long-term 2/

Spread between
U. S . O o v t . and
Corporate
State and
local Aaa

State and
l o c a l govt.
Aaa y

(Per cent)
Low
1957 - High
1 9 5 8
- Low
1959 - High
Low
I960 - High
Low
1951*

-

July
July
Aug.
Aug.
Aug.

22
29
5
12
19 2 /

2.16

2 . 8 5

3.76
3.07
If. 37
3.63

U . U 4
3 . 5 5

h.6l

lt.09
l*.6i
U.26

(6/6)

1.90

(10/18)
lh/2S)
(12/31)
(1/2)

I S i S
3 . 0 6

i..te ( i / 8 )
3.75 (8/5)

1*.1*0
1*.38

( 3 / 2 6 )

3.53 (1/7)

3.02 (8/18)

3.81
3.81
3.75
3.78
3.81

l*.3l*
1*.30
U.26

(9/2)

3.32
3.28
3.22
3.11*

.30
.60
.22
.50
.16

.30
.17
.34
.92
.53

. 5 9

. 9 2

. 1 9

. 5 3

. 5 6

. 5 3

. 5 7

3.02

. 5 3

. 5 9

. 5 3

. 5 2

. 6 1

.1*5

. 7 9

Lower-grade
Date

Corporate
Baa 1 /

State and
local govt.
Baa y ^

'

Spread between
Aaa and Baa
State and
Corporate
l o c a l govt.

(Per cent)
Low
1957 - High
1 9 5 8
Low
1959 - Higfr
Low
I960 - High
Low
1951A

July
July
Aug.
Aug.
Aug.

-

22
29
5
12
19 £ /

3 , 111*

( 1 2 / 3 1 )

5.10 (1V29)
l*.5l ( 7 / 1 1 )
5 . 3 2

( 1 2 / 3 1 )

2 . 9 3

( 8 / 5 )

U.51 (8/29)
3.61*

5 / 1 )

. 7 7

. 9 3

1*.1*6

( 7 / 2 )

. 7 7

. 9 8

( 3 / 2 6 )

. 5 6

1*. 1*6 ( 1 / 7 )
l*.ll (8/18)

5.20

1*.26

5 . 1 5

5.15
5.11
5.06

. 9 6
1 . 2 1

3 . 9 2

a/17)
5.36 (2/12)
5.06 (8/19)
U . 8 3

. 5 2
1 . 2 7

1*.25
l*.2l*
1*.21
1.11

.81*
.71
.80
.77
.81
.81
.80

. 7 9
1 . 0 7
. 9 2

.91*
.97
1 . 0 2

1.07
1.09

d/ Preliminary.
5/ Weekly average ef daily figures. Averse term of bundle Included Is 26-Z6 j i » r i .
I f Weekly average of dully figure•. The eerie# includes bonds Aw er callable In 10 years or mar#.
3/ Thursday figures. Only general obligation bonds are ineluded; average torn le 20 years.
Note.—Highs and lews are for individual series and may be on different dates for different series.




SHORT-

AND

INTERMEDIATE-

TERM

INTEREST

RATES

GOVERNMENT




|7v

Ix.Vv

Exhibit D - Tables f o r Exhibit C
Short- and Intermediate-term I n t e r e s t Rates
Government
Date

Discount
rate 1/

Yields
6-month
b i l l s 2/

3-month
b i l l s 2/

3-5 y e a r
issues 2/

Spread between y i e l d s on
3-month b i l l s and y i e l d s on
6-rao, b i l l s 13-5 y r . i s s u e s "

( p e r cent)
1951*
1957
1958
1959

-

Low
High
Low
High
Low
I960 - High
Low

1.50
3.50
1.75
in 00
2.50
Loo
3.00

.61
3.61*
.58
1*.57
2.63
4.59
2.13

July
July
Aug.
Aug.
Aug.

22
29
5
12
19 E/

3.50
3.50
3.50
3.00
3.00

2.31
2.21*
2.13
2.18
2.31

(6/11)
(10A8)
(5/29)
(12/26)
(2/20)
(1/8)
(8/5)

3.02
lu91
2.92
5.07
2.39

(12/26)
(12/31)
(1/2)
(1/8)
(8/5)

2.62
2.56
2.39
2.1*8
2.66

1.66
lt.Ol*
2.11*
5.00
3.70
4.97
3.1*9

(V30)
(10/18)
(6/7)
(12/21*)
(1/2)
(1/8)
(8/5)

3.67
3.51*
3.1*9
3.52
3.53

.26
.79
.19
.58
.16

.66
.86
.01*
1.1*2
• 1|0
1.81
.38

.31
.32
.26
.30
.35

1.36
1.30
1.36
1.31*
1.22

Private

Date

Stock Exchange
c a l l loan 1 /

Spread between 3-month
Prime
Finance company Treasury b i l l y i e l d and
rate 1/
paper ] /
f i n a n c e company
paper r a t e s
( p e r cent)

1951*
1957
1958
1959

-

Low
High
Low
High
Low
I960 - High
Low

3.00
1*.50
3.50
1*.7 5
3.75
5.5o
5.oo

3.00
l*.5o
3.50
5.00
lt.00
5.00
5.00

1.25 (12/31)
3.88 (11/16)
1.13 (8/8)
1*. 88 (12/31)
3.00 (l*/6)
5.13 (1/22)
2.91* (8/19)

July
July
Aug.
Aug.
Aug.

22
29
5
12
19 2 /

5.oo
5.oo
5.oo
5.oo
5.oo

5.00
5.oo
5.oo
5.oo
5.oo

2.96
2.91*
2.91*
2.91*
2.91* "

0
.59
-.35
.86
.13
1.02
.22

(12/18)
(7/19)
(8/29)
(10/9)
(12/1*)
(3/25)
(V15)

.65
.70
;81
.76
.63

1/ Meekly rate shown la that in effect at end of period. Discount rate Is for Federal Reserve Bank of Hew York.
Stock exchange call loan rate i s going rate on oall loans secured ty custoaers' stock sxohinge oollateral at
New York City banks. Prime rate Is that oharged by large banks on short-term loans to business borrowers of
the highest credit standing.
2/ Market yield* weekly averegee ooapitted from dally closing bid prices'. Series of 3-6 year Issues wnslst* of
selected notes and bon&t.
2/ Average of dally rates published ty finance companies for directly placed paper for varying maturities In the
90-179 day range.
Mote.—Highs and lows are for individual series and nay be on dlffertnt dates for different series. For spread#,
nigh refers to widest, and low to narrowest.




Monthly




Thousands
~|

(including lorm)

ol

Units
160 !

Exhibit F - Tables f o r Exhibit E
Stock Market.
Stock p r i c e
index 1 /

Date

1957-1959 - High
Low
I960 - High
Low

60.51
39.78
59.50
54.24

June
July
Aug. 5
Aug. 12
Aug. 19 g /

57.26
55.8k
55. 44
56.66
57.01

1/
2/
3/
4/
5/

(7/31/59)
(12/27/57)
(1/8)
(3/11)

Common
Trading
stock
volume 2 /
y i e l d s 2/ (millions
( p e r cent) of shares)

Stock market customer c r e d i t
Customers 1
Bank
Total debit b a l - loans t o
ances h /
(Mi]Llions of d o l l a r s )

3.07
it. 66
3.18
3.51

4.3
1.4
3.9
2.U

4,761
3,554
4,365
4,132

3,401
2,482
3,198
3,004

1,373
1,060
1,167
1,111

3.35
3.1*5
3.49
3.42
3.a

3.5
2.7
2.6
2.9
2.7

4,211;
4,133
n.a.
n.a.
n.a.

3,082
3,004

1,132
1,129
1,133
. 1,125
n.a.

n.a.
n.a.

n.a,—Hot available.
g / Preliminary.
Standard and Poor's composite Index of 600 common stocks, weekly closing prices, 1941-43=10. Monthly data
are averages of dally figures rather than of Fridays' only. Highs and lows are for Fridays' data only.
Standard and Poor's composite stock yield based on Wednesday data converted to weekly closing prices by
Federal Reserve, Yields shown are f o r dates on which price Index reached I t s high or low.
Averages of dally trading voluae on the New York Stock Exchange,
End of month figures for member firms of the New York Stock Exchange which carry margin accounts; exoludis
balances secured by U. S. Government obligations,
Wednesday figures for weekly reporting member banks, Bcoludes loans for purohaslry or carrying U, S, Governmeat s e c u r i t i e s . Prior t o July 1, 1959, such loans are excluded only a t banks i n New York and Chicago. Weekly
reporting banks account for about 70 per cent of loans t o others. For further d e t a i l see Bulletin,

P r i v a t e Housing. S t a r t s 1 /
Date

1959 - July
Aug.
Sept.
Oct.
Nov.
Dec.
i960 - Jan.
Feb.
Mar.
Apr.
May
June 2 /
July p/
1/

Seasonally a d j u s t e d
Unadjusted
annual r a t e
Total
Conventional
Nonfarm
Total
Nonfarm
Total
FHA VA Nonfarm
Total
old s e r i e s new s e r i e s old s e r i e s new s e r i e s
old s e r i e s new s e r i e s
(Thousand of u n i t s )
1,375 1,578
1,340 1,U50
1,323 1,509
1,180 1,378
1,210 1,356
1,330 1,451
1,216 1,366
1,115 1,367
1,125 1,112
1,135 1,325
— — 1,342
—
1,298
1,173

127
125
117
102
91
83
75
74
95
109
——

148
138
136
120
105
96
87
88
,90
123
128
122
110

32
31
30
27
20
20
16
18
22
25
25
26
24

11
10
10
9
8
6
4
5
5
7
7
8
7

85
84
77
, 66
62
57
55
52
68
76
——
—

:106
97
97
84
76
69
67
65
63
91
96
88
79

Total s t a r t s are Census estimates, which are not s t r i c t l y comparable with old nonfarm series developed by BLS, A
duelling unit i s started when excavation begins; a l l units In c.n apartment structure are oonsi-lered s t a r t e d a t that
time. FHA ar.l VA data repraaorrt unite started, as based oa f i e l d o f f i c e reports of f i r s t compliance Inspections
which are nade before footings are poured In seme canes but normally a f t e r the foundations have been completed.
Capehart nlll-tary housing units are excluded. Conventional s t a r t s are derived as a residual, although t o t U and
FHA and VA s t a r t s are not s t r i c t l y comparable In concept or timing; they include both units fimnoed by conventional
mortgages and units without mortgages.




Exhibit G
Long-term Corporate and State and Local Government
Security•Offerings and Placements
(In millions of d o l l a r s )

I960

Corporate 1 /
1 1959
1

New c a p i t a l
1958

January
February
March

$11
715
860

821
738
61*6

1,5532/

April
May
June

766

891
785
887

1,11*0
597
887

535
7ii0
703

1,107
5k0
1,111*

879
861*
900

862
518
920

2,201*
2,567
2?6hl

3,139
2,623
2,760
2,300

9,392

10,823

. 1,03k

July
August
September

e/800
e/925

October
November
December
1st
2nd
3rd
iith

quarter
quarter
quarter
quarter

1st half
Three quarters
Year

2.151
'2,36?

; %,$19

s

728

88

.

I960

S t a t e and l o c a l 2/
1 1958
1 1959

736
623
575

639
858
61i6

729

932
593
1,006

,551
E/970
e/550
e/5S0

B
S

1,93k
g/2,2U9

E/1I,183'

812

£

g

798

806
W3
651
1*56
U7U
W5

2,lU3

2,21,1*
1,860
I'MB
1,571
1,365
l4,67U
6,222
7,793

1,520
tike

Excluding finance companies h /
1st
2nd
3rd
l*th

quarter
quarter
quarter
quarter

1,722
e/'2,067

Year
1/
2/
3/
U/

1,999
2,1*12
1,716
2,503

2,899
2,586
2,731
2,213

8,630

10,1*29

S e c u r i t i e s and Exchange Commission estimates of net proceeds.
Investment Bankers Association of America estimates of p r i n c i p a l amounts.
Includes $718.3 million AT&T convertible debenture i s s u e .
Total new c a p i t a l issues excluding o f f e r i n g s of s a l e s and consumer finance
companies.




Exhibit H

h.lk

-13-

Other Security O f f e r i n g s 1/
(In m i l l i o n s of d o l l a r s )
Long-teim
Foreign government 2/
Federal agency 3/
I960
I960
1
1959
1
1958
1
1
1959
January
February
March

175
70

April
May
June

33

81
60
2

196
53

1o 8
12

139
198
120

182

199

$

175

H18
35h

523

85
1
35,

9
5
17

October
November
December

33
30
70

58
$

86

5U7

992

70?

I6I4
98
150

April
May
June

1

365
fi/2li7

190
128
295
563
lill
215

July
Aupust
September

2i*6
16?
399

October
November
December

235
3k3
358

Year

h,179

2,321

Federal agency 3/

233
U60
273

h79
I463
512

359
500
I189

371 •
208
Ihh

s

509

I186
675
289

209
161
329

727
' 665

li37
206
330

his
2L3

In
288

1.5U
liU
137

3,910

6,0/tf

3,09a

26U

•

220

*

Short-term
S t a t e and l o c a l government U/
January
February
March

1,163
251

--

July
August
September

Year

1958

289
$

g

2 / Preliminary.
/
1 / Data presented I n t h i s e x h i b i t d i f f e r from those I n Exhibit' E I n t h a t r e f u n d i n g l s s u o s , an well a s new
c a p i t a l i s s u e a , a r e lnolu-led. Long-term e a o u r l t l e s are duflnnd a s those maturing In m^re thar. one y u a r .
2 / Inoludos s e c u r i t i e s off-ired I n the United S t a t e s by f o r e i g n govorwnenta and t h e i r s u b d i v i s i o n s end by
l n \ e r m t l o n a l o r g a n i s a t i o n s . "ouroaj S e c u r i t i e s and Kxahr.^ge Commission.
3/ I s s u e s not gunrejit<ad by the U. S, Gov^mner.:.. Souroei l o m ' - t e m , S e c u r i t i e s and Btobanj;® Cor.nl a i l on)
s h o r t - t e r m , Federal Reserve.
4 / P r i n c i p a l l y t a x and bond a n t i c i p a t i o n not*a, warrants or c e r t i f i c a t e # ar.<l Public Housing Authority
not**. I n some i n s t a n c e s PHA r.-itee l m l u i k d may have a somewhat longer t i n than one y e a r ; Sourcei Bond Buyer.




_lli_

Exhibit I
Large Long-term Public Security I s s u e s f o r New Capital
(Other than U, S. Treasury) 1 /
Proceeds of Large Issues Offered
(Millions of d o l l a r s )
Corporate

Month

S t a t e and
l o c a l government

Other 2 /

19U
263
21lt
291;
163
217
388
283
225
370
23U
561
191

50
98
175
20

110
363
199
itOO
1*21
230
279
262
381;
309
139
bh2
303

1959 - July
August
September
October
November
December
i960 - January
February
March
April
May
June
July

70
100
320
191
71
28
30

Large Individual Issues Offered August 1 through 19

Type y

Issuer

CORPORATE
Deb.
Southwestern B e l l Tel. Co.
Texas Eastern Trans. Corp. S.F. deb.
Com. s t k .
El Paso Natural Gas Co.
Conv. deb.
Consumers Power Co.
Deb.
Michigan Bell Telephone Co.
Deb.
General Motors Accept.Corp.

Coupon
Amount
Offering
r a t e or
(millions
Rating
Maturity
n
e
t inter- yield
of
dollars)
e s t cost
100.0
25.0
33.0
38.1
35.0
150.0

1995
1980

5-3/8

li.55
5.38

Aaa
Ba

1975
1996
1982

1-3/8

It. 38
H
i
U. 68

Aa
Aaa

li-5/8

—

STATE AND LOCAL GOVERNMENT
Chesapeake Bay Bridge and
Tunnel Commission

hev.-Ut.
Rev.-Ut.
11
Rev.-Ut.
G.O.
Los Angeles Co., California
G.O.
State of C a l i f o r n i a
OTHER
Fed. Mat. h t g . Assoc.

J




Deb.

70.0
30.0
81.3
11.0
15.0
75.0

2000
2000
2000
1961-80
1965-90/85
1971

5.62
5.62
5.62
3.31
3.31
I1-I/8

It.88
5.50
5.75
1.70-3.1*5
2 .W- 1.00
lulO.

Aa •
Aa

—

H.lL

^.-2

-

Footnotes

1 / Includes corporate and o t h e r s e c u r i t y o f f e r i n g s of $15 m i l l i o n and over;
S t a t e and l o c a l government s e c u r i t y o f f e r i n g s of $10 m i l l i o n and over.
2 / Includes f o r e i g n government and I n t e r n a t i o n a l Bank f o r Reconstruction and
Development i s s u e s and non-guaranteed i s s u e s by Federal a g e n c i e s .
y
In the case of S t a t e and l o c a l government s e c u r i t i e s , - G. 0 . denotes general
obligations5 Rev.-Ut., revenue o b l i g a t i o n s secured only by income from public
u t i l i t i e s ; Rev.-Q.Ut., revenue bonds secured only by revenue from q u a s i - u t i l i t i e s ;
Rev.-S.T,, revenue bonds secured by revenue f r o m s p e c i f i c taxes only; Rev.-Rent.,revenue bonds secured s o l e l y by lease, payments.




Exhibit J

-16-

Forthcoming Large Long-term Public Security Offerings f o r New Capital
(Other than U. S. Treasury) 1 /
Expected Proceeds from Forthcoming Large I s s u e s
Date of
computation

During month following
date shown
Corporate S t a t e and
Other 2 /
l o c a l govt.

July 31
Aug. 31
Sept. 30
Oct. 30
Nov. 30
Dec. 31
Jan. 29
Feb. 29
Mar. 31
Apr. 29
May 31
June 30
July 29

238
198
37 k
385
226
210
207
301
299
202
1*83
237
596

356
385
270
115
295
W*5
210
255
250
2ii3
277
180
275

—

25
70
30
1*5
35
30
30
—

Subsequent to_
date shown
Cozporate - S t a t e and
Other 2 /
l o c a l govt,
Uo6

305
517
69k
509
271
280
252
372
3Wt

25

1*02

1*70
336
1*85
515

70
30
1*5
35

385
280
258
502
380
32h

1

1,006

60
30

Forthcoming Large O f f e r i n g s , a s of August 19
Issuer

Type

Amount
Approximate date
(millions
of o f f e r i n g
of d o l l a r s )

CORPORATE
Southern C a l i f o r n i a Edison Co.
McKesson & Bobbins, Inc.
Republic S t e e l Corp.
^Virginia E l e c t r i c & Power Co.
^Public Service Co. of Colorado
Utah Power & Light Co.
P a c i f i c Power & Light Co.
s-Union E l e c t r i c Co.
American Telephone & Telegraph Co.
Commerce Oil Refining Corp.
T r u s t o r s ' Corp.
Liberian Iron Ore, Ltd.
Natural Gas Pipeline of America
Natural Gas Pipeline of America

1 s t r e f . mtg. bds.
Deb.
Deb.
1 s t r e f . mtg. bds.
Pfd. s t k .
1st mtg. bds.
1 s t mtg. bds.
1 s t mtg. bds.
Deb.
Deb., bds. & com.
Partic. c e r t i f .
Bds. & s t k .
1 s t mtg. bds.
Pfd. s t k .

60.0
15.0
125.0
25.0
15.0
16.0
20.0
50.0
250.0
1*5.0
1*0.0
30.0
25.0
15.0

Aug. 2k
Aug. 25
Aug. 31
Sept. lit
Sept. 15
Sept. 15
Sept. 22
Oct. 19
Oct. 25
Indefinite
Indefinite
Indefinite
Indefinite
Indefinite

STATE AND LOCAL GOVERNMENT
xState of
S t a t e of
East Bay
-^Atlanta,

Vermont
Washington
Municipal U t i l . l i i s t . , Cal.
Georgia




G.O.
G.O.
G.O.
G.O.

13.7
3U.0
30.0
12.7

Aug.
Aug.
Aug.
Aug.

23
23
21*
30

J-2

-17-

Forthcoming Large O f f e r i n g s , a s of August 19 (Cont'd)
Issuer

Type

Amount Approximate date
(millions
of o f f e r i n g
of d o l l a r s )

STATE AND LOCAL GOVERNMENT (Cont'd)
Alameda»Contra Costa T r a n s i t ?Dist eJI
California
*New York Sta te Thruway Auth.
City & Co. of San Francisco, C a l i f ,
*Pa. S t a t e Highway & Bridge Auth.
*State of Ohio
•^Public Housing A u t h o r i t i e s
Milwaukee, Wisconsin

Rev.-Ut.
Rev.-Ut.
G.O.
Rev.-Ut.
G.O.
G.O.
G.O.

16.5
50.0
21.5
10.0
31.0
1*8.9
10.8

Sept.
Sept.
Sept.
Sept.
Sept.
Sept.
Sept.

7
8
12
13
13
Ik
20

OTHER
None
*—Included in t a b l e f o r f i r s t t i m e .
1 / Includes corporate and o t h e r i s s u e s of $1$ m i l l i o n and over5 S t a t e and l o c a l
/
government i s s u e s of $10 m i l l i o n and over.
2 / Includes f o r e i g n government and I n t e r n a t i o n a l Bank f o r Reconstruction and
Development i s s u e s and non-guaranteed i s s u e s by Federal agencies.
Note. —Deletions f o r reasons o t h e r than s a l e of i s s u e : None.




Exhlbit K

-18-

Yields on New and Outstanding
E l e c t r i c Power Bonds, Rated Aa and A 1 /
Date

1952-1959 - High
Low
1959 - July
Aug.
Sept.
Oct.
Nov.
Dec.
1960 - Jan. 7
Feb. 25
26
Mar. 15
16
18
29
Apr. 6
8
11*

21
27
May 10
12

Aa-rated o f f e r i n g y i e l d s
A-rated o f f e r i n g y i e l d s
Amount above
Amount above
Actual
Actual
seasoned
y
i
e
l
d
s
seasoned y i e l d s
( p e r cent)
(per
cent)
(basis points)
(basis points)
5.30 (12/8/59)
2.93 (3/31/51*)

87
-3

*lu93
h.83

31
23

5.13^/
*5.08
*5.30

:
63

5.08
5.10

1*1*
1*6

32
17

1*.85

33

k.9h

39

1*.95
1*.88

39
32

25

June 17
28
29
July 8
13

li.82
1*.81*

25
27

5.65 (9/18/59)
3.00 (3/17/51*)

123
-15

5.07

17

*5.65
5.33

60
1*3

&

51
28

5.00

li.93

11
7

1*.98

21

5.30

50

5.10
5.20
I*. 95

26
33

1*.93
1*.88

11
8

#— Single observation, not an average.
1/ Covers only 30-year f i r s t mortgage bonds, as reported in Moody's Bond
Survey. Except where Indicated, the a c t u a l y i e l d f i g u r e and the amount above
seasoned y i e l d s are averages of o f f e r i n g s during the indicated period and of
the d i f f e r e n c e s between these new o f f e r i n g y i e l d s and y i e l d s on seasoned issues
of similar quality f o r the same day. Average maturity f o r the seasoned issues
v a r i e s from 26 t o 28 years.
2/ Provides f o r a 5-year period during which issue may not be called f o r
refunding a t a lower coupon r a t e . Monthly averages so marked include one or more
issues with such a provision. Other issues have no such provision.




-19-

Exhibit M
Sources and Uses of Funds by
Savings and Loan Associations

Cash
Value of a s s e t s
a t end of period
1956 - Dec.
1957 - Dec.
1958 - Dec.
1959 - Dec.
1$!60 - June

2,119
2,1146
3,585
2,201
2,*61

Changes:
1958 - Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.

119
42
178
. -290
-70
-77
-107
J42
335

1959 - Jan.
Feb.
Mar.
Apr.
May
July
Aug.
Sept.
Oct.
Nov.
Dec.
i960 - Jan.
Feb.
Mar.
Apr.
May
June

Uses of funds 1/
u. s .
Mort- Other
Govt,
gages
assets
2/
ities

Sources of funds
• Net
Total
change borrowsource's
Other
ing y
or uses savings
capital

(In m i l l i o n s of d o l l a r s )
2,782
3,173
3,819
4,474
4,577

35,775
40,049
45,627
53,093
56,310

42,875
2,199
46,136
2,770
3,106 . 55,139
3,707
63,475
67,142
3,994

37,148
41,912
47,976
54,
58,243

1,347
1,379
1,444
2,388
1,930

4,380
4,647
5,719
6,531
6,969

362
511
935
73
360
447
507
480
1,072

112
-29
165
-37
51
84
58
41
212

187
199
-311
180
205
161
174
144
-437

434
4o8
529
420
604
1,090
190
394 •
444
399
483
1,175

-181
-56
-5
97
63
313
31
118
148
136
57
223

93
226
241
262
314
-312
126
211
83
113
90
-625

460
409
623
372
~ 6 33
1,182

-453
-3 25
-127
38

79
210
171
231
301
-554

37
12
81
42
110
11+6
10k
51
37 '

403
528
573
554
564
578
605
470
528

102
99
-43
-90
12
45
137
102
-53

661
681
78y
216
616
692
739
665
847

-298
-26
-2
-182
26
245
-132
-43
-53
-68
65
384

297
97
76
105
23
-4
104
17
-7
7
-34
-26

402
427
593
705
754
840
783
727
670
621
459
485

-55
80
98
151
178
10
-108
22
65
88
140
-70

346
578
765
779
981
1,091
347
723
675
648
63d
773

-314
-33
49
-30
QD
308

201
67
-27
1
15
-15k

320
398
545
566
6 30
758

-113
62
100
104
2 09
-75

94
494
667
641
934
837

i7
1/

209

Preliminary.
.
Uses oi' funds represent net changes i n a s s e t s and t h e r e f o r e r e f l e c t n e t ,
r a t h e r than gross, uses. Savings and loan a s s o c i a t i o n s do not hold business
s e c u r i t i e s and data on holdings of S t a t e and l o c a l government bonds, presumed
t o be small, a r e not a v a i l a b l e ,
2/ P r i o r t o 1957, data a d j u s t e d to i n c l u d e mortgage pledged shares a a c u r r e n t l y
reported.
y
Advances from home Loan Banks and other borrowing.

Source.
—Federal Savings and Loan Insurance Corporation.



Lxhibit N.
Sources and Uses of Funds by
Mutual Savings Banks
Uses of funds 1/
State &
Busilocal
govt.
gages
i t i e s i t i e s 2j i t i e s

U.. S.
Govt.

Cash

Value of
it end of
1956 1957 1958 1959 i960 -

assets
period
Dec.
Dec.
Dec.
Dec.
June

Changes:
1958 - Apr.
May
June
July
Aug.
Sept.
Oct.
Nov.
Dec.

Sources of :founds
Other

Total
sources
or uses

Net
change
in
deposits

Other

(In m i l l i o n s of d o l l a r s )
920
890
921
829
8U0

7,971
7,552
7,266
6,86k
6,539

3,523
1,331
4,973
1,81,9
4,925

-47
-5
42
-66
-5
18
-8
-38
101

-85
-62
-36
11
19
-27
-92
-32
-2

97
120
-24
34
8
34
-6

119
. 39
,62

-16
6
-31
58
-20

47

669 19,529
682 20,951
725 23,039
722 24,768
697 25,662

698
761
855
910
968

33,311
35,168
37,779
38,942
39,631

30,032
31,695
34,041
34,983
35,463

4,168'

h
-19
2h
8
2
2
-3
-1
-7

154
195
253
193
198
ia
195
15L
174

-29
ho
5
-28
29
29
-I46
h3
-3

94
269
261;
152
251
237
40
123
309

93
181
300
88
143
267
95
42
418

1
68
-36
64
108
-30
-55
81
-109

208
125
175
155
161
115
179
156
160
137
12 h
132

-58
32
38
-32
15
39
-12
33
31
-37
h2
-12

175
216
330
-10
217
101
32
192
163
-283
65
218

122
113
313
6
120
202
-54
80
197
-187
-27
3140

53
103
17
-16
97
-41
86
112
-34
-96
92
-122

159
116
150
U9
161
179

-12
43
111
-21
63
-56

-11
167
319
-132
176
170

-68
50
320
-95
58
215

57
117
-1
-37
118
-45

1959 - Jan. 3/ -96
Feb F
IB
Mar*
15
Apr.
-Ilk ••
May
8 43
/July
-79
Aug,
3
Sept.
-2
Oct.
-27
Nov.
20
Dec.
111

13
-85
-13
-12
-32
-281
-85
-12

-hi
13
-2
-55
-28
23

17
-h
hi
- *33
10
-19
h
-1
6
-20
-8
-2U

i960 - Jan.
Feb.
Mar.
Apr.
May
June

-9
-11
32
.-1JU8 .
-80
-109

-12
-9
52
-19
13
51

-6
-9
3
13
-23
-3

-131
37
4l
-86
42
108

,

3,#9
3,473
3,738

l / Uses of funds represent net changes i n a s s e t s and t h e r e f o r e r e f l e c t , n e t r a t h e r
than g r o s s , uses.
,2/ Includes Canadian government and p o l i t i c a l s u b d i v i s i o n s , I n t e r n a t i o n a l Bank f o r
Reconstruction and Development, nonguaranteed Federal agency and other bonds as
well as corporate bonds and s t o c k s .
j / a d j u s t e d t o eliminate the e f f e c t of a c o n s o l i d a t i o n of a l a r g e savings bank with
a commercial bank.
Source.—National
 Assoc. of Mutual Savings Banks and Federal Deposit Insurance Corp.



Exhibit L

—21—

Sources and Uses of Funds by
L i f e Insurance Companies

Cash

U. S.
Govt.
ities

Value of a s s e t s a t
end of p e r i o d :
1956 - Dec.
1957 - Dec.
. 1958 - Dec.
1959 - Dec.
I960 - June

Uses of funds 1 /
BusiS t a t e and
ness
l o c a l govt.
secursecuri t i e s 2/
ities

Mortgages

Other ,

Total
sources
or uses

( I n m i l l i o n s of d o l l a r s )
1,273
1,29k
1,363
1,327
1,213

7,519
7,028
7,182
6,81$
6,559

Changes:
1958 - Apr.
May
June
July
Aug.
Sept.
Oct.
Nov,
Dec.

-18
61
-21*
22
-18
1
-17
55
110

ill
-71
1*5
172
1*1*
1*
11
19
-11*2

1959 - Jan.
Feb,
Mar.
Apr.
May
June
July
Aug.
Sept.
Oct,
Nov,
Dec,

-81
-57
-1U
-21
10
3
-15
19
-31
22
33
99

303
-71
-185
22
-16
11
13
95
-185
-22
-131
-168

i960 -v Jan,
Feb,
Mar,
Apr,
May
June

-91
-53
-30
39
-12
33

163
-36
-167
-85
-62
-102

2,231*
2,377
2,691
3,177
3,317

32,991*
35,271
37,092
39j299
1*0,631

11*
29
31*
21*
37
20
26
32
12

115
118
102
128
139
11*2
186
H*5
291

39
161*
11*8
1*5
151*
72
72
88
331*

360
1*61*
506
582
1*85
1*53
587
1*76
913

188
223
251
21*2
193
21*2
211*
75
95
208
207
227

53
30
66
1*9
79
23
9U
30
15
8
16
23

119
139
136
116
135
157
211*
171*
211
251
21*0
315

-17
171*
108
80
97
60
208
101
95
92
131*
226

565
1*38
362
1*85
1*98
1*96
728
1*91*
200
559
1*99
722

128
125
101*
131*
231
125

20
25
35
21
26
13

271*
196
21*2
225
203
192

82
207
115
95
128
211

576
1*61*
299

39,552
{|2,133
Mi, 612
W,977
1*7,821
216
lli3
201
191
129
211*
309
137
308

12,272
95,81*1*
13,206 101,309
11*, 6U0 107,580
15,996 113,626
l^,83d 116,377

1*29

5lS
1*69

1/ Uses of funds represent n e t changes i n a s s e t s and t h e r e f o r e r e f l e c t n e t , r a t h e r
than gross, u s e s .
2/ Includes s e c u r i t i e s of domestic corporations only.
Source. — I n s t i t u t e of L i f e Insurance,




August 22, I960
P a r t I I — Canada
Sharp d e c l i n e s i n Treasury b i l l y i e l d s dominated Canadian money markets
l a s t week. These d e c l i n e s brought Canadian b i l l y i e l d s close t o those i n t h e
United S t a t e s and v i r t u a l l y wiped out any i n c e n t i v e t o buy Canadian b i l l s .
Bond y i e l d s f e l l from 10 t o 20 p o i n t s on the s h o r t and intermediate m a t u r i t i e s
(up t o 12 y e a r s ) and t o a l e s s e r e x t e n t on longer m a t u r i t i e s . The spread
of Canadian bond y i e l d s compared with U.S. y i e l d s narrowed only s l i g h t l y .
For the f i r s t time i n a month and a h a l f , the spot Canadian d o l l a r declined
f r a c t i o n a l l y during the week.
Money market c o n d i t i o n s . At l a s t Thursday's a u c t i o n , t h e average
y i e l d on the 3-month Treasury b i l l dropped sharply by 35 b a s i s p o i n t s t o
2.66 per cent per annum from 2 . 9 1 per cent a week ago (see T a b l e ) . I t i s
only one b a s i s * p o i n t above i t s low f o r the y e a r . The 6-month b i l l y i e l d
a l s o dropped by 2b b a s i s p o i n t s t o 2.89 per cent from 3.13 p e r cent t h e
previous week. I t i s now equal t o i t s low f o r the y e a r . The chartered banks
purchased $21 m i l l i o n of Treasury b i l l s and the general public sold $19
m i l l i o n . The average closing r a t e on day-to-day loans remained a t 2.98 per
c e n t , the same as i n t h e previous week.
The n e t i n c e n t i v e t o hold t h e Canadian s h o r t Treasury b i l l on a
covered b a s i s f e l l s h a r p l y from 0.73 per c e n t per annum on August 11 t o 0.28
per cent on August 18. This was t h e r e s u l t of the f a l l of 39 b a s i s p o i n t s
i n the spread between t h e Canadian and United S t a t e s 3-month Treasury b i l l
r a t e s and the disappearance of t h e premium of the 3-month forward d o l l a r
(see T a b l e ) .
Bond market. Short and intermediate bond y i e l d s dropped during
the week between 10 and 20 b a s i s p o i n t s . The Bank of Canada purchased $17
m i l l i o n of bonds and the chartered banks purchased $10 m i l l i o n , while the
general p u b l i c sold $23 m i l l i o n . The spreads between s e l e c t e d comparable
Canadian and United S t a t e s s e c u r i t i e s (Thursday y i e l d f o r b i l l s and Wednbsday
y i e l d f o r bonds) were as follows ( f i g u r e s i n parentheses r e f e r t o the
previous week):
0.28
0.17
0.85
1.09
1.20

per
per
per
per
per

cent
cent
cent
cent
cent

on
on
on
on
on

a 91-day b i l l (0.67)
a 182-day b i l l (0.58)
an 8-year bond (0.96)
a 20-year bond ( l . l U )
a 35-year bond (1.29)

Market sources noted t h a t the f a i l u r e of an expected new i s s u e by the
Canadian National Railways t o appear c o n t r i b u t e d t o t h e r i s e i n Government
of Canada i s s u e s l a s t w e e k . ^ I t i s a l s o r e p o r t e d t h a t the Bank of Canada
has withdrawn o f f e r i n g s of a number of outstanding i s s u e s from t h e market.
P r u d e n t i a l Insurance Co. of America has bought a $30 m i l l i o n 6 - 1 / 8
p e r c e n t , 20-year f i r s t mortgage bond i s s u e of Celgar L t d . , which i s
building a $50 m i l l i o n pulp m i l l and sawmill i n B r i t i s h Columbia. Last
week, t h e r e was an o f f e r i n g i n Canada of $1,206,000 s e r i a l debentures of




e,

&
*
%
f
-g
w
^
j?
r

-23Cote S t . Lac, Quebec5 t h e 5-1/2 p e r cent l - t o - 1 0 - y e a r m a t u r i t i e s were
p r i c e d t o y i e l d 5.70 per cent and t h e 6 per cent U - t o - 2 0 - y e a r i s s u e s
were p r i c e d t o y i e l d 6.25 per cento
During t h e second q u a r t e r , Canadian mutual funds r e p o r t e d s u b s t a n t i a l s h i f t s from bonds i n t o e q u i t i e s (see T a b l e ) . This movement
reversed the trend of the two preceding q u a r t e r s .
Exchange r a t e * During the week, the Canadian d o l l a r f e l l t o
103.125 (U0S0 c e n t s ) on Thursday from 103.313 t h e week b e f o r e (see Table)•
The premium on t h e 3-month forward Canadian d o l l a r , which developed i n
the previous week, disappeared on Thursday* This i s t h e f i r s t easing i n
both t h e spot and 3-month forward d o l l a r since lAte June.
Stock exchange. The p r i c e s of i n d u s t r i a l stock on the Toronto
and Montreal exchanges have declined s t e a d i l y throughout I960 (see Table
below) o Canadian stocks now a r e r e t u r n i n g the h i g h e s t average y i e l d i n
more than two y e a r s , with an average of 1+.08 per c e n t on those shares used
t o compile t h e Toronto Stock Exchange i n d u s t r i a l index, compared with a
y i e l d of about 3 . 5 per cent f o r stocks used i n the New York Dow-«Jones
i n d u s t r i a l average. P r i c e s of i n d u s t r i a l stock on both the Toronto and t h e
Montreal exchanges improved by 5-6 per cent from August 11 t o . 1 7 as noted
i n the following t a b l e :
Toronto
January U
February 2
March 1
April 1
May 2
June 1
July 5
August 11
12
15
16
17

532.58
515.U8
U9L.71
195.23
U8U.60
1:96.75
U85.50
U85.9U
U90.31
U90.9U
U92.38
U92.9U

Montreal
318.9
305.8
290.6
285.1
280.9
28U.1
272.0
262.9
265.U
268.0
268.1
268.3

B r i t i s h Commonwealth Section
Division of I n t e r n a t i o n a l Finance
Bqard of Governors of the Federal Reserve System




New York
Standard
6U.50
60.81
59.83
59.lL
57.59
59.57
60.65
59.77
60.19
60.08
60.18
60.30

Selected Canadian Money Market and Related Data
3-mo . T r e a s . b i l l s
Spread
Canada
U . S ^ / over U.S.

Canadian d o l l a r
discount ( - )
Spot
3-mo.
forward premium(+)<y

1959 - High
Low
1960 - High
Low

6,16
3«25
5«lU
2.65

U.U9
2.80
U.63
2.15

2.96
0.30
0.90
-O069

105.51
102.58
105.27
101.31

July 28
Aug. 3
11
18

2.9-2
2.83
2.91
2.66

2.23
2.15
2o2li
2.38

0.69
O068
0.67
0.28

102.66
102.75
103.31
103.13

.

.

-

102.56
102.75
103.33
103.13

Net i n c e n tive to
hold Can,
bill®/

0.31
-0.72

0.9U
-0.57

-0.35
0.0
+0.06

0.33
0.68
0.73
0.28

a / Average y i e l d a t weekly tender on Thursday.
— —
15/ Composite market y i e l d f o r t h e U.S. Treasury b i l l on Thursday c l o s e of b u s i n e s s ,
c / In U.S. c e n t s ,
d / Spread between spot r a t e and 3-month forward Canadian d o l l a r on Thursday
c l o s i n g , expressed a s p e r c e n t per annum.
e / Spread over U.S. Treasury b i l l (column 3)> p l u s 3-month f o r w a r d ' d i s c o u n t or
premium (column 6 ) .
Selected Government of Canada S e c u r i t y Yields
6-moe Treas . b i l l s
Spread
Canada
u?ri/

Intermediate
bonds (8 y r . )
Spread
over
Canada
U.S.d/

-1959 - High
Low
I960 - High
Low

6.2L
5.11
5.33
2.89

0^85
-0.69

5.37
U.50
2.52
U.U5

1.11
0,21

July 2 8 1
Aug. 3
10
17

3.15
3.05
3.13
2.89

0.61
0.65
0.58
0ol7

U.57
U.53
U.5U
U»U5

0.92
0.9U
0.96
0.85

Long-term bonds
(20 year)
(35 year)
Spread
Spread
Canada
over
Canada
e/
U.S J /
«TJ/
5.30
•

5.U2
U.85

1.22
0.87

5.05
U.73
5.28
U.85

U.88
U.85
Ut8 9
U.87

1.11
1.1U
1.1U
1.09

U.87
U.85
U.90
• U.86

u.uu

a / Average y i e l d a t weekly tender on Thursday.
Spread between Canadian auction r a t e and composite market y i e l d of U.S.
on c l o s e of business Thursday.
Government of Canada 2 - 3 A p e r cent of June 1967-68•
Spread over U.S. Government 2-1/2 p e r c e n t of 1963-68.
Government of Canada 3-l/U p e r cent of October 1979.
Spread over U.S. Government 3 - l / U p e r c e n t of 1978-83.
Government of Canada 3 - 3 / 1 p e r c e n t of September 1996 - March 1998.
Spread over U.S. Government of 199$,

bill
c/
a/
e/
y
g/
E/




1.61
0.98
1.25
1.25
1.29
1.20

Canada i Changes in Distribution of Holdings of Canadian
Government Direct and Guaranteed Securities
(millions of Canadian dollars, par valueJ
Bank of Canada
Treas*
Bonds
bills
June 16
23
30
July 7
Hi
21
28
Augo li
11
18

Source:

*
*
+
+
-

20
k
5
18
2
18
3
12
3

+
+
+
+
+
+
+
+

Government
Total

13
13
5
U8
12
5
13
11
5
17

- 12
- 17
0
+ 13
- 2
+ 13
+ 25
+ 57
+ 15
+ 2

Chartered banks
Treas.
bills
Bonds
+
+
+
~
+

+
+
+
+
. •

Ul^
5
U6
21
21
h
h
12
8
21

5
2
11
27
6
U
3
3U
1
10

-25-

General publifl
savings m a s .
bonds bill* Bonds
-

3
7
7
5
2
6
6
5
5
5

- 52
- 1
+ Uo
- k9
> 2h
+ k
- 37
0
+ 11
- 19

Bank of Canada, Weekly F i n a n c i a l S t a t i s t i c s .

Canada:

Changes i n P o r t f o l i o s of Nine Mutual Funds p
end of q u a r t e r a March and June I960
t i n p e r c e n t of t o t a l a s s e t s )
"

All Canadian Funds
Canada General Fand
Canadian Investment Fund
Commonwealth I n t e r n a t i o n a l
Corporate I n v e s t o r s
I n v e s t o r s Mutual
Mutual Accumulating
New York C a p i t a l Fund
Scudder Fund
Source:

March

Bonds
June

Equities
March
June

10.6
0.6
19.0
31o5
15.3
201.
18.2
9.1
5.5

5.1
0.3
19.6
22 ok
16.6
23.1
16.6
6.9
koh

89.lt ' 9U.9
99.U
99.7
81.0
80.U
78.3
77.6
8U.7
83.U
79.9
75.9
81.8
83.U
90.9
93.1
95 06
?U.5

F i n a n c i a l P o s t , August 20 3 I 9 6 0 .




- 11
+ h
17
25
15
k
- 10
35
9
23