Full text of H.16 Capital Market Developments : October 12, 1971

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ffimUEKflJll
L.5.8 Confidential (F.R.)

(•':

DECONTROLLED ATOR SIX MONTHS

October 12,1971

fa#

CAPITAL
MARKET
DEVELOPMENTS




»c

U

-•
L.f.<

INDEX
3-5

Developments in the Corporate and Municipal Bond Markets

6-7

Capital Market Yields

8-13

Capital Market Volume

14-17

Stock Market

18-33

Mortgage Market

SYMBOLS:
e

Estimate

p

Preliminary

r

Revised

n.a.

Not available




3

TABLE 1: Yields, Volume and Reception

WEEK ENDING:

1971 - Sept.

Oct.

YIELDS
MOODY'S
SEASONED
NEW ISSUE 1
Aaa

3
10
17
24

7.38
7.21
7.56
7.60

7.45
7.42
7.44
7.44

413
285
673
832

54
77
93
90

n.a.

1
8
15

7.53
7.30

7.46
7.44

123
371e
45 Oe

82
77e

n.a.
n«cL*

....

WEEK ENDING:

1971 - Sept.

Oct.

CORPORATE BOND MARKET
VOLUME 2
PER CENT
GROSS
SOLD BY END
BONDS SCHEDULED
OFFERINGS
OF WEEK
WITHIN 28 DAYS /

YIELDS
BOND BUYER
MOODY'S
SEASONED 20
SEASONED
Aaa
BOND INDEX

MUNICIPAL BOND MARKET
VOLUME 2
PER CENT
GROSS
SOLD BY END
OF WEEK
OFFERINGS

3
10
17
24

5.30
5.00
5.10
5.15

5.39
5.36
5.38
5.48

474
371
350
235

91
34
77
67

1 j
8
15

4.90
4.80

5.24
5,17
n.a.

991
368
311

73
75

BONDS SCHEDULED
WITHIN 28 DAYS
805
848
910
1,397
955
833
n.a.

1 Derived by adjusting to a Aaa basis, new issues of publicly-offered corporate bonds
with call protection, rated A, Aa, or Aaa by Moody's Investors Service (except serial
and convertible issues, offerings of natural-gas pipeline and foreign companies, and
bonds guaranteed by the Federal Government.)
2 Millions of dollars unless otherwise indicated.
Note:

See footnotes to Table 3




TABLE 2: Details on Inventories
DATE
OFFERED.

AMOUNT ,
(MIL.' $)

10/6
10/5
10.5
9/13

JL _ _ _

40.0
50.0
100.0
23.0

OFFERED

DATE
j1 RELE\SED

CORPORATE BONDS IN SYNDICATE END OF LATEST WEEK
ORIGINAL
RATING AND
ISSUER
I
COUPON
YIELD CALL PROTECTION
Gen. Tel S.W.
Ohio Bell Tel.
Ohio Bell Tel
Cent'l P.S.

|

7
6
7
7

7/8
3/8
1/2
7/7

7.85
6.38
7.55
7.75

A
Aaa
Aaa
Aa

5
6
5
5

ESTIMATED PROPORTION SOLD

yrs
yrs
yrs
yrs

50%
40%
65%
98%

CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK
ORIGINAL INCREASE RATING AND ESTIMATED PROISSUER
COUPON
IN YIELD CALL PROT. PORTION RELEASED
YIELD

AMOUNT

NONE

INVENTORIES
MUNICIPALS
BLUE LIST
|
IN SYNDICATE

DATE
1971 - Sept.

Oct.
N .
1

10
17
24

565
647
630

243
112
ill

164
73
84

1

759r

308

8

872

242

31
85

- No call protection.
Ml

CORPORATES
IN SYNDICATE

'
'
'"

figures in millions of dollars. Bluv List Is dally average for w v k vn.lv.l Fri.lnv, vxcudu f,,r l , t , M
1S
a
vuraRe of three days ended Wednesday. All other figures ..re -as of Frid v..




|
-

TABLE 3: High Grade Bond Yields

•NEW
CORPORATE
Aaa1

DATE

MOODY'S SEASONED
CORPORATE
Aaa 2

U.S. GOVERNMENT
20-YEAR
CONSTANT
MATURITIES 3

BOND
BUYER'S
SEASONED
MUNICIPALS 4

1969 - High
Low

8.85 (12/5)
6.90 (2/21)

7.84 (12/26)
6.55 (1/12)

6.97 (12/26)
5.96(1/24)

6.90 (12/18)
4.82 (1/28)

1970 - High
Low

9.30 (6/19)
7.68 (12/18)

8.60 (7/3)
7.48 (12/31)

7.55 (5/29)
6.17 (12/18) k

7.12 (5/29)
5.33 (12/11)

1971 - High
Low

8.23 (5/12)
6.76 (1/29)

7.71 (8/13)
7.06 (2/12)

6.51 (6/18)
5.69 (3/23)

6.23 (6/24)
5.00 (3/18)

17
24

7.56
7.60

7.44
7.44

6.08
6.09

5.38
5.48

1
8

7.53
7.30

7.46
7.44

6.01
5.95

5.24
5.17

1971 - Sept.

Oct.

1

New corporate issues, with call protection, adjusted (as described in
footnote 1 of Table 1) to a Aaa basis.
2
Weekly average of daily figures. Average term of bonds included is
22-24 years.
3
Weekly average of daily figures.
4
Thursday figures. The average rating of the 20 bonds used in this index
falls midway between the four top groups as classified by Moody's Investors Service.
x
Note--Highs and lows are for individual series and may be on different dates
for different series.




TABLE 4: Long-term Corporate and State and Local Government
Security Offerings and Placements
(In millions of dollars)

^

GROSS PROCEEDS
CORPORATE

PERIOD
1971

1971

2 ,636
1 ,802
3 ,539

2 ,075
2 ,045
2 ,098

3 ,170
3 ,909
3 ,389

2 ,748
2 ,076
2 ,530

2 ,768
2 ,274
2 ,518

2 ,478
1 ,427
2 ,427

3,,777
4 :,182
3.,980

1:,933
2.,375
2 :,532

7 :,977
10,,468
8,,560
11, 939

6,,218
7,,354
6,,332
6, 840

23,844
18, 445
34,878e ' 27, 005
38, 944

13, 572
19, 904
26, 744

3,115
3,000
6,075

April
May
June

4,007
3,271
4,375

July
August
September

4,064
2,850e
4,120e

October
November
December
1st
2nd
3rd
4th

Quarter
Quarter
Quarter
Quarter

1st half
Three quarters
Year

STATE AND LOCAL

1969

January
February
March

12,190
11,654
ll,034e

1970

1

1

2

1970

1969

2,705
1,839
,2,144

1,340
1,214
1,555

1,262
987 |
538 j

1,907
2,135
2,008

1,647
996
1,085

1,801
1,110 '
737 •

1,928
1,871
1,700e

1,348
1,359
1,758

1,097
808
559

1,924
1,748
2,190

1,280
886
816

6,688
6,050
5,499e

4,109
3,728
4,465
5,862

2,787 :
3,648 i
2,464
2,982 ;

| 12,738
j
18,237e

7,837
12,302
18,164

6,435 .
8,899
11,881 :

:

;
t

1
1-

Securities and Exchange Commission estimates of gross proceeds.
Investment Bankers Association of America estimates of principal amounts.




TABLE 5: New Corporate Security Issues, Type of Issue and Issuer
(In millions of dollars)

QUARTER
OR
MONTH
1970-111
IV
1971 - I
II
Hie.

\
TOTAL
8,560
11,938
12,190
11,688
11,034

GROSS PROCEEDS BY
TYPE OF ISSUE
COMMON
AND
MEMO:
BONDS
PUBLICLY PRIVATELY PFD.
ISSUES INCLUDED
STOCK
PLACED
FOREIGN | CONVERTIBLE
OFFERED
83
287
5,937
914
1,659
7,827
226
737
1,421
2,690
8,369
1,516 . 2,306
84
724
6,546
3,384
1,758
215
1,351
4,731
4,516
1,787
n.a.
772

GROSS PROCEEDS BY
TYPE OF ISSUER
COMMUNICATIONS

MFG.

PUBLIC
UTILITY

2,314
3,169
3,794
3,130
1,839

2,714
3,406
3,197
2,910
2,556

868
1,346
1,606
896
2,362

2,663
4,020
3,594
4,753
4,277

OTHER
ISSUERS 1

1970 - Sept.
Oct.
Nov.
Dec.

3,518
3,777
4,181
3,979

2,425
2,390
3,001
2,436

389
304
283
834

704
1,083
898
709

4
56
11
159

121
388
184
165

994
1,006
1,107
1,056

1,241
1,101
1,350
955

445
371
693
282

838
1,300
1,033
1,687

1971 - J a n .
Feb.
Mar.

3,115
3,000
6,075

2,033
2,201
4,135

594
275
647

489
524
1,293

43
3
38

99
168
557

716
661
2,417

676
1,069
1,452

391
683
532

1,332
587
1,675

4,042
3,271
4,375
4,064
2,850
4,120

2,116
2,148
2,282
1,331
1,400
2,000

507
491
760
537
500
750

1,419
633
1,332
2,196
950
1,370

116
47
52
64
n.a.
n.a.

384
255
712
197
300
275

1,135
588
1,206
529
485
825

1,267
588
1,055
721
800
1,035

273
405
218
1,622
350
390

1,367
1,489
1,897
1,192
1,215
1,870

Apr.
May
June
July
e/ Aug.
e/ Sept.

1

Other issuers are extractive, railroad and other transportation, real estate
and finance, and commercial and other.
Source: Securities and Exchange Commission. Quarterly supplements are available.




TABLE 6: Large Long-term Public Security Issues for New Capital
(Other than U.S. T r e a s u r y ) 1
•

ISSUER

\
v

Oct. 1 thru Oct. 8, 1971

TYPE

2

AMOUNT
(MILLIONS
OF
DOLLARS)

MATURITY

COUPON
RATE OR
NET INTEREST COST

OFFERING
YIELD

MOODY'S
RATING

Corporates
Ramada Inn
Gen'l Tel Co of the S.W.
Phila Elec Co
Ohio Bell Tel Co
Ohio Bell Tel Co
Tenneco Inc
Mohasco Industries, Inc

)

r




Debs
1st mtg
Com stk
Notes
Debs
1st mtg
pipeline
Com stk

60.0
40.0
50.2
50.0
100.0

1996.
2001
1978
2011

6,.38
7,.50

• 6,
.38
7,.55

100.0
21.1

1991

8,.20

8,.20

--

--

5.,00
7.,88

5.,00
7,,85

--

--

--

A
Aaa
Aaa
A
. ' I-

TABLE 6: Large Long-term Public Security. Issues for New Capital (continued)
(Other than U.S. Treasury) 1
Oct. 1 thru Oct. 8, 1971
• !

ISSUER

TYPE 2

AMOUNT
(MILLIONS
OF
DOLLARS)

COUPON
1
RATE OR
| OFFKRNET INTERTi,C
EST COST
I YIKLD

MATURITY

MOODY'S
RATING

State and Local
Buffalo, N.Y.
Buffalo, N.Y.
Kentucky Turnpike, Auth
Kentucky Turnpike, Auth
Minneapolis, Minn
Minneapolis, Minn
Minneapolis, Minn
Maine
Maine
Massachusetts Port, Auth
Massachusetts Port, Auth
Chicago Public Bldg. Comm, 111

G.O.
G.O.
Rev.
Rev.
G.O.
G.O.
G.O.
G.O.
G.O.
Rev.
Rev.
Rev

Other
Federal Land Bank
Federal Land Bank

Bonds
Bonds

8. 3
18. 3
13. 5
71.,5
3.,6
4.4
2,,2
13.,8
8,.0
19,.9
58 .1
25,.0
326 .0
300 .0

1972-1990
1972-1985
1975-1991
2001
1973-1981
1973-1981
1972-1991
1990-1991
1972-1991
1975-1998
2001
1973-1991

4.34
3.96

4.96

2.,80-4. 90
2.,80-4.40
4.,00-5. 90
6..20
2..90-4. 75
3,.00-4. 75
2,.90-4.,75
2,.80-4.,60
2,.80-5.,00
4 .00-5.,90
6 .03
3 .30-5,.50

1974
1977

5.85
6.35

5 .85
6.35

•

*
1
2

3

---

4.43
3.66
4.20
4.27
4.23
——
--

*

. -

I

flights ottering.
'
Includes corporate and other security offerings of $15 million and over;
State and local security offerings, of $10 million and over.
In case of State and local government securities, G.O. denotes g e m r a l obligation;
Rev.-Ut,, revenue obligations secured only by income from public utilities;
Rev.-Q.-Ut,, revenue bonds secured only by income from quas i-utiliti us; Rev.-S.T.,
revenue bonds secured by revenue from specific taxes only; Rev.-Rent., revenue
bonds secured solely by lease payments.
Includes foreign government and International Bank for Reconstruction and
Development issues and non-quaranteed issues' by Federal Agencies.




Aa
Aa
—

Aaa
Aaa
Aaa
Aaa
Aaa
—
--

A-l
—-

10
TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital
(Other than U.S. Treasury) 1
(continued)
of Oct. 8 ,
As

ISSUER

TYPE

AMOUNT
(MILLIONS
OF
DOLLARS)

1971

APPROXIMATE DATE
OF OFFERING

Corporates
Cenco Instrument Corp
Florida Pwr Co
Pacific Pwr & Light Co
Gulf Pwr Co
Trail Mobile Finance Co
Mass Mutual Mtge & Realty Inv.
Ohio Power Co
FMC Corp
Carolina Telephone & Telegraph
Carolina Pwr & Light Co
Houston Natural Gas Corp
Illinois Pwr Co
Mountain Bell
Mountain Bell
Southwestern Elec Pwr Co
Pacific Gas & Elec Co
Teffi Industries Inc.
Beneficial Standard Mtg. Inv
Honeywell Finance Inc
Beneficial Corp
Beneficial Corp
Consolidated Foods Corp
Coastal State Gas Producing
Portland General Elec
Firestone Rubber Co
Combustion Engr. Inc.
Dallas Pwr & Light Co
Metropolitan Edison Co
Alison Mtge & Inv Trust
Detroit Edison Co
Detroit Edison Co
International Paper Co
Delmar Va Pwr & Light Co
Pacific Lighting Service Co




Debs
1st mtg
1st mtg
Bonds
Notes
Debs
1st mtg
Debs
Debs
1st mtg
Debs
1st mtg
Debs
Notes
Mtg
1st mtg
Conv deb
Conv debs
Debs
Notes
Debs
Debs
1st mtg
1st mtg
Debs
S.F. debs
1st mtg
1st mtg
Debs
Com stk
Sen'l & ref
mortgage
Conv debs
Lst mtg
)ebs

30.0
50.0
35.0
21.0
25.0
50.0
40.0
75.0
20.0
70.0
32.0
35.0
125.0
75.0
30.0
125.0
25.0
15.0
50.0
50.0
50.0
50.0
50.0
20.0
100.0
50.0
30.0
15.0
25.0
60.0
90.0
60.0
35.0
30.0

Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Nov.
Nov.
Nov. .
Nov.
Nov.
Nov.
Nov.
Dec.

12
12
12
13
13
14
14
16
18
'19
19
20
26
26
27
28

3
3
4
4
4

11
TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital
(Other than U.S. Treasury) 1
(continued)

ISSUER

TYPE

AMOUNT
(MILLIONS
OF
DOLLARS)

&s of Oct. 8, 1971
APPROXIMATE DATE
OF OFFERING

State and Local
Dallas, Indp S/D
Orlando, Utilities Comm, Fla
Montgomery Co., Md.
Michigan, State of
Puerto Rico
Commonwealth of Puerto
Columbus, Ohio
New York
New Orleans, La
New York State
North Dakota
Detroit, Mich
California State
Salt River Proj Agric Imp &
Pwr, Dist
Sacramento MUD, Cal.,
Penna State Pub Sch Auth
Maryland, State of
Los Angeles Co. Flood Contri
Dist, Calif
Los Angeles DWAPS
Ohio, State of
Guilford Co., N. C.
Anne Arundel Co, Md

G.O.
Rev.
G.O.
G.O.
G.O.
Bonds
G.O.
Bonds
Airport rev
G« 0.
G.O.
Rev.
Rev

17.5
33.5
30.0
40.0
40.0
40.0
11.8
96.0
18.0
96.0
15.0
20.0
13.7

Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.
Oct.

13
13
14
14
14
14
18
21
21
21
26
26
27

G.O.
Rev.
Rev.
Bonds

52.0
50.0
15.7
60.0

Oct.
Oct.
Oct.
Oct.

27
27
28

G.O.
Rev.
G.O.
G.O.
G.O.

19.0
50.0
100.0
10.0
15.0

Nov.
Nov.
Nov.
Nov.
Nov.

2
4
4
9
17

Bonds

200.0

Other
FHLB

*
1
2

Included in table for first time..
Includes corporate and other issues of S15 million and over; State and local
Government issues of $10 million and over.
Includes foreign government and International Bank for Reconstruction and
Development issues and non-guaranteed issues of Federal Agencies.




12

STOCK PRICES AND VOLUME
STOCK PRICES1

TRADING VOLUME 2 •

DATE
N Y S E INDEX 3 -

D J . INDUSTRIALS

AMEX 4

NYSE

AMEX

1969 - High
Low

50.32 (5/14)
49.31 (7/29)

968.85 (5/14) 32.91 (1/13)
769.93 (12/17] 25.02 (7/29)

16.5 (3/29)
8.6 (8/29)

8.0 (1/31)
3.6 (11/21)

1970 - High
Low

52.36 (1/5)
37.69 (5/26)

842.00 (12/29) 27.02 (1/8)
631.16 (5/26) 19.36 (5/27)

18.5 (12/4)
7.8 (8/14)

7.1 (1/2)
1.8 (8/14)

1971 - High
Low

57.76 (4/28)
48.73 (1/4)

950.82 (4.28) 26.68 (4/28)
830.57 (1/4) 22.72 (1/4)

22.1 (2/12)
11.0 (8/13)

6.7 (2/12)
2.7 (8/13)

Sept

3
10
17
24

55.66
55.56
55.24
54.26

912.75
911.00
908.22
889.31

25.61
25.66
25.59
25.35

11.4
14.6
10.8
12.2

3.1
3.3
3.2
2.8

Oct.

1
8

54. 66
54.94

893.98
893.91

25.54
25.71

11.4
14.8

3.1
4.1

Figures other than highs and lows are Fridays only.
Highs, and lows are for the year and are not necessarily for Fridays.
NYSE is the New York Stock Exchange; AMEX is the American Stock Exchange.
Volume figures are daily averaged for the entire week, (millions of share#).
Trading is normally conducted for 5-1/2 hours per day and 5 days per week, or
In recent years, however abbreviated trading to the extent, and over the time
Hours/
Days/
From
Through:
Day
Week
January 3, 1949
July 7, 1969
January 2, 1970

July 3, 1969
December 31, 1969
May 1, 1970

3.

12/31/65 - 50

4.

Average dollar value of shares listed.




27-1/2 hours per week.
periods, shown below:
Hours/
Week

13

TABLE 9: Security Credit

END OF PERIOD

CREDIT EXTENDED TO
MARGIN CUSTOMERS BY:
BROKERS' I BANKS 2 I TOTAL

CUSTOMERS'
NET DEBIT
BALANCES

NET CREDIT
CUSTOMERS' NET EXTENDED BY
BROKERS AND
FREE CREDIT
DEALERS 3
BALANCES

Outstanding;

6,110

3,810
3,920
4,010
4,010
4,030

2,300
2,330
2,270
2,320
2,330

6,250
6,280
6,330
6,360

(4)
(4)
(4)
(4)
(4)

2,083
2,236
2,163
2,197
2,286

4,000
4,090
4,300
4,530
4,620
4,720
4,790
4,850

2,300
2,330
2,360
2,340
2,340
2,390
2,420
2,430

6,300
6,420
6,660
6,870
6,960
7,110
7,210
7,280

(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)

2,452
2,743
2,798

Aug.
Sept
Oct.
Nov.
Dec.

10
110
90

10
30
-60
50
10

-60
140
30
50
30

171
153
-73
34
89

1971 -Jan
Feb.
Mar.
Apr.
May
June
July
Aug

-30
90
210
230
90
100
70

-30
30
30
-20

-60
120
240
210
90
150
100
70

291
291
55
-138
-110
110
230
-10

1970

Aug.
Sept.
Oct.
Nov.
Dec.

1971 -Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.

2,660
2,550
.2,440
2,210

2,200

(4)

(4)
(4)
(4)
(4)
(4)
(4)
44)
(4)
(4)

Change in
Outstanding
1970

20

•

60

50
30
10

Margin debt, as reported by the New York Stock Exchange. Although margin debt
until March 1968 included loans secured by U.S. governments, the amount of such
loans included is thought to have been small.
"Bank loans to others than brokers and dealers for purchasing or carrying securities other than. U.S. governments."
The difference between customers 1 net debit balances and customers' net free credit balances, this figure represents the net credit extended by brokers and
dealers to the nonfinancial.public.
,
L
v
NOTE* With the exception of bank loan data, figures are supplied by the New York
Stock Exchange and are end of month data. Bank loans are for weekly_reporting
large commercial banks. Broker data includes loans for regulated securities; bank
data includes loans for the purpose of purchasing or carrying any security, whether
Ite^les1 ^ s c o n t & u e d .
Changes in series.




TABLE 10: Savings Flows at Nonbank Depositary Intermediaries
($ millions)

DATE

MUTUAL SAVINGS BANKS
REGULAR DEPOSITS 3
NET
NEW
. ANNUAL
MONEY 2
GROWTH
NET
1
RATE
FLOW

4,203
2,549
4,466

1968
1969
1970

7.0
4.0
6.7

1970 - July
August
September

297
176
575

—•

1971 - July
August
September %/

416
300
600

—•»

—

--

-—

1,143
-763
936

U
TOTAL
DEPOSITS
ANNUAL
NET
GROWTH
RATE 1
FLOW

SAVINGS & LOAM ASSOCIATIONS
NET
SHARE CAPITAL
ANNUAL
NEW
NET
GROWTH
MONEY 2
1
FLOW
RATE
Not Seasonally Adjusted
7,432
6.0
2,738
4,200
3.2
-1,003
11,173
8.2
5,295

174
81
-8

543
550
1,827

276
200
0

1,554
1,106
2,610

11

840
726
2,402

«.*

1,463
1,050
1,100

1,970
1,406
3,210

••

4,172
2,791
2,970
3,167
1,707
2,549

21.8
14.3
15.1
15.9
8.4
12.5

—

*•

6.3
3.4
7.7

485
511
575

—

--

11,635
6,749
15,639

NET
NEW
MONEY 2

3,881
-1,766
6,231
659
592
567

—

---

1,714
1,250
1,100

Seasonally Adjusted
1971 - April
May
June
July
August
September

1
2
3

1,176
795
818
566
425
450

19.0
12.7
12.9
8.8
6.6
6.9

-— •

----

2,996
1,996
2,152
2,601
1,282
2,099

23.1
15.1
16.1
19.2
9.3
15.1

•*

-»
, «• •

e

Annual growth rate for monthly data Is the annualized monthly percentage Increase in deposits.
Net New Money is new deposits net of both withdrawals and interest. Data for S&Ls are for
insured associations only, which represent 96% of industry total resources.
Regular deposits at mutual savings banks exclude items such as Christmas club and certain
escrow accounts, which represent a very small part of total deposits.
SOURCE: National Association of Mutual Savings Banks and Federal Home Loan Bank Board.




••
mm
mm
mm

TABLE 11: Mortgage Commitments at Selected Thrift Institutions

DATE

TOTAL

OUTSTANDING COMMITMENTS
ALL
MUTUAL
SAVINGS &
SAVINGS
BANKS
LOAN
(N.Y. STATE)
ASSOCIATIONS

TOTAL

1

NET CHANGE
ALL
SAVINGS &
LOAN
ASSOCIATIONS

MUTUAL
SAVINGS
BANKS
(N.Y. STATE)

(Billions of Dollars, See sonally Adjusted)!/

70 - Aug.
Sept.
Oct.
Nov.
Dec.

9.8
8.9
9.3
9.6
10.1

•71 - J a n .
Feb.
Mar.
Apr.
May
June
July
Aug.

10.4
11.2
12.6
13.8
15.3
16.1
16 J
16.4

1

6.8 '
7.1
7.5
7.8
8.1
8.3
8.9
10.1
11.1
12.2
13.0
13,2
13.3

2.0
1.8
1.8
1.8
2.0

.21
.25
.30
.35
.51

2.1
2.3
2.5
2.8
3.1
) 3.1
3.1
3.1

.25
.80
1.36
1.30
1.56
- .77
.24
.13

.29
.36
.37
.34
.28
.20
.60
1.16
1.01
1,21
.72
.28 r/
.08

Based on data from Federal Home Loan Bank Board and Savings Banks Associations of
New York State. Net changes are derived directly.from unrounded outstandings
levels as reported and after seasonal adjustment by Federal Reserve. Subtotals
may not add to totals because of rounding. Mutual Savings Banks and total data
include building loans beginning August 1 9 6 7 .




-.08
-.11
-.07
.01
.23
.05
.20
.20
.29
.34
.05
.02
.05

TABLE 12: Net Change in Mortgage Holdings

DATE

TOTAL
INCLUDING
FNMA-GNMA

TOTAL

1

FINANCIAL INSTITUTIONS
LIFE
MUTUAL
SAVINGS &|
SAVINGS
LOAN
J INSURANCE
BANKS
ASSOC.
j COMPANIES

COMMERCIAL
BANKS

Not Seasonally Adlusted
18,219
21,273
19,814
16,913

4,639
6,677
5,404
2,462

3,153
2,787
2,682
1,845

7,520
9,350
9,676
10,288

2,907
2,459
2,052
2,318

1,797
2,508
4,375
4,909

2,136
2,089
2,070

1,739
1,626
1,671

187
200
300

209
160
182

1,140
1,079
1,114

203
187
75

397
463
399

1971 - June
July
" Aug.

4,544
4,264
n.a.

4,411
3,948
n.a.

1,300
•1,000
1,000

435
389
n.a.

2,693
2,511
2.372

-17
48

133
316
626

1970 - July
Aug.
Sept.
Oct.
Nov.
Dec.
1971 --Jan.
Feb.
Mar.
Apr.
May
June
July
Aug

2,083
1,017
2,192
2,128
2,049
2,604
1,860
2,097
2,988
2,939
3,280
4,177
4,259
n.a.

1,575
1,509
1,828
1,808
1,820
2,504
1,893
2,184
2,996
2,018
3,273
3,972
3,898

1,055
983
1,104
1,175
1,289
1,710
1,311
1,425
1,774
2,044
2,095
2,339
2,484
2,239

213
83
151
200
131
232
24
97
154
38
25
23
72

508
408
364
320
229
100
-33
-87
-8
-79
7
205
361
634

1967
1968
1969
1970 2./

20,016
23,781
24,189
21,822

1970 - June
/-July
Aug.

Seasonally Adlusted

1

165
268
329
295
224
312
383
445
688
653
840
1,197
969
972

142
175
245
138
176
250
175
217
380
283
313
413
373

....

.

Monthly data for commercial banks based on Federal Reserve estimates benchmarked
to Call Report data on real estate loans outstanding as available. Other data
derived from mortgage debt outstanding as reported separately by National Assn.
of Mutual Savings Banks, Federal Home Loan Bank Board, Institute of Life Insurance
and, through August 1968, the Federal National Mortgage Association, and thereafter by FNMA and the Government National Mortgage Association. Data for mutual
savings banks and for Life Insurance companies may differ somewhat from those
derived from- regular quarterly series because o£ minor conceptual differences for
which adjustments are not made in the monthly series. Altogether, these groups
accounted for 84 per cent of the net increase estimated for all holders in 1970.




TABLE 13: Net Increases in Mortgage Debt Outstanding

1

Billions of dollars, SAAR QUARTER

TOTAL

RESIDENTIAL 3

1- to 4FAMILY

MULTIFAMILY

COMMERCIAL

MULTI-AND
COMMERCIAL

FARM

1966 - II
IV .

18.6
15.1

10.9
9.1

8.3
7.0

2.6
2.1

5.5
4.1

8.1
6.2

2.2
1.8

1967 - I
II
III
IV

15.9
20.7
26.6
27.3

10.3
13.9
19.2
19.8

. 7.0
10.5
15.3
16.0

3.3
3.4
3.9
3.8

3.9
5.0
4.9
4.8

7.2
8.3
8.8
8.6

1.8
1.8
2.5
2.8

1968 - I
II
III
IV

27.7
26.2
26.0
29.6

19.0
18.2
17.7
20.2

15.8
15.0
14.1
16.4

3.1
3.2
3.4
3.8

6.4
5.9
6.5
7.5

9.6
9.0
10.1
11.3

1969 - I
II
III
IV

31.3
28.9
26.5
25.1

25.0
21.5
19.3
18.3

18.6
16.9
14.6
13.0

4.4
4.7
4.7
5.3

6.2
5.2
5.3
5.4

10.6
9.9
10.1
10.7

2.2
2.2
1.8
1.4

1970 - I
II
III r/
IV r/

20.2
22.8
29.5
31.6

13.8
16.9
22.1
22.5

8.8
11.5
15.8
16.1

5.0
5.4
6.3
6.4

4.9
4.3
5.2
6.9

9.9
9.7
11.5
13.4

1.5
1.5
2.1
2.1

1971 - Ip r/
H P £/

36.3
47.6

25.9
36.4

17.7
26.2

8.2
10.2

8.1
8.9

16.3
19.1

2.2
2.3

1

2
3

.

"

2.3
2.2
1.8
1.8

Derived from data on mortgage debt outstanding from Federal Deposit Insurance
Corporation, Federal Home Loan Bank Board, Institute of Life Insurance, National Association of Mutual Savings Banks, Departments of Commerce and Agriculture, Federal National Mortgage Association, Federal Housing Administration,
Veterans Administration and Comptroller of the Currency. Separation of nonfarm mortgage debt by type of property, where not available, and interpolations
and extrapolations, where required, estimated mainly by Federal Reserve. "
May differ somewhat from related flow of funds series mainly because of more
aggregative type of seasonal adjustment.
Residential mortgage debt includes nonfarm only and is sum of 1-to 4-family
and multifamily mortgage debt combined.




18

TABLE 14: FNMA Weekly " A u c t i o n " Results'

WEEK
ENDED

COMMITMENTS IN $ MILLIONS
ACCEPTED
1 -YEARH
90TOTAL
TOTAL
6-'
OFFERED
MONTH & OVER
DAY

IMPLICIT YIELD 2 (per cent)
90DAY

6M0NTH

1-YEAR
& OVER

June

1
14
28

322.4
664.4
539.3

146.6
191.2
262.2

77.1
133.7
191.8

57.8
47.3
60.3

11.6
10.2
10.4

8.05
7.91
7.92

8.18
8.15
8.22

8.16
, 8.22
8.28

July

12
26

606.0
686.2

241.1
183.4

161.8
183.4

58.2

21.1

8.31

--

7.98
8.07

8.23

--

25

634.6

153.5

153.5

--

7.97

--

Aug.
Sept.

7

445.2

188.6

188.6

7.88

1

--

-'/

Note: Under the FNMA auction system, approved sellers of Governmentunderwritten mortgages bid for FNMA forward purchase commitments, subject to an over-all dollar limit announced by FNMA in advance. Bids
accepted by FNMA are for delivery at the seller's option, and at any
time within the specified period. Bids on proposed homes relate to
construction not yet started on which mortgages may be delivered only
after completion and occupancy.
1

For "proposed construction" of new homes only.

2

Average secondary market y^eld after allowance for commitment fee and
required purchase and holding of FNMA stock, assuming prepayment of
15 years for 30-year Government-underwritten mortgages. Yields shown
arc gross, before deduction of 50 basis points fee paid by investors
to servicers.

3

FNMA announced limit of accepted bids for next week's auction.




19

TABLE 15: Private Housing Starts and Permits
STARTS
UNADJUSTED
TYPE OF FINANCING
FHA | VA | OTHER

BUILDING
PERMITS
(SEASONALLY
ADJUSTED
ANNUAL
RATE)2

SEASONALLY ADJUSTED
ANNUAL RATE
TOTAL 1-FAMILY 2 OR MORE

TOTAL

1970 - Aug.
Sept.
Oct.
Nov.
Dec.

1,425
1,509
1,583
1,693
2,054

838
881
890
934
1,240

587
627
693
759
814

128.7
130.9
140.9
126.9
121.4

34.1
34.3
40.4
33.7
63.2

5.6
5.3
5.8
5.5
5.7

87.7
91.3
94.7
87.2
52.5

1,378
1,388
1,523
1,487
1,768

1971 - Jan.
Feb.
Mar.
Apr.
May.
June
July r/
Aug el/

1,725
1,754
1,959
1,912
1,975

946
985
1,048
1,098
1,124
1.177
1.178
1,221

779
769
911
814
851
823
1,037
1,007

110.6
102.2

32.2

4.6
4.7
6.9
8.5
8.4
9.3
9.3

7.2.8
68.4
127.6
148.0
149.4
137.8
142.6

1,635
1,563
1,62?
1,638
1,927
1,849
2,052

2,000
2,215
2,229

167.9

201.1
198.5
193.8
193.2
201.4

27.3
33.4
44.6
40.7
46.1
42.0

2,008

Total starts are Census estimates including farm for both permit-issuing and
noii-issuing areas. A dwelling unit is started when excavation begins; all units
in an apartment structure are considered started at that time. FHA and VA
starts are units started under commitments by these agencies to insure or guar- z
antee the mortgages. As reported by-FHA and VA, a unit is started when a field
office receives the first compliance inspection report, which is made before
footings are poured in some cases but normally after the foundations have been
completed. Other starts are derived as a residual, although total and FHA and
VA starts are not strictly comparable in concept or timing; other starts include both units financed by conventional mortgages and units without mortgages.
Building permits are for 13,000, or all known permi't-issuing places. Unlike
starts, seasonally adjusted building permits reflect direct adjustment for ,
differences in the number of working days per month, as well as other
differences in timing and coverage.




2o

TABLE 16: Mortgage and Bond Yields
FHA
MORTGAGES
DATE
30-year
1968 - High
Low
1969 - High
Low
1970 - High
Low

_

1971 - Apr.
May
June
•
July
Aug.

1

2

3
4
5
6

2

CONVENTIONAL
MORTGAGES
3

SPREAD BETWEEN YIELDS
ON CONV. &
FHA MORTGAGES 5

1

NEW
Aaa CORPORATE
BONDS
4

SPREAD BETWEEN
YIELDS ON NEW
CORPORATE BONDS
AND
FHA MORTGAGES 6

7.52
6.78
8.62
7.99

7.40
6.75
8.35
7.55

.02
-.27
-.13
-.40

6.79
6.15
8.75
6.91

1.20
.26
1.08
-.13

9.29
8.40

8.60
8.30

-.10
-.74

9.11
7.80

.99
.01

7.37
7.75
7.89
7.97
7.92

7.55
7.65
7.70
7.80
7.85

.18
-.10
-.19
-17
-.07

7.57
8.01
7.90
7.96
7.65

-.20
-.26
-.01
.01
.27

Neither mortgage nor bond yields include allowance for servicing costs which are
much higher for mortgages than for bonds. Generally, bonds pay interest semiannually; mortgages, monthly. Mortgage yields, if computed as equivalent to
a semi-annual interest investment, would be slightly higher than given in the
table.
Based on FHA-field-office oponions about average bid prices in the private
secondary market for new-home mortgages for immediate delivery. Data shown
are for 30-year mortgages with minimum downpayments, and weighted by probable
volume of transactions. Yields computed by FHA, assuming prepayment period of
15 years for 30-year mortgages.
Based on FHA-field-office opinion on typical interest rates (rounded) on conventional first mortgages prevailing in the market areas of insuring office cities
See note for Table 1.
Yield spread equals conventional mortgage rate less FHA secondary market yield.
Yield spread equals FHA secondary market yield less new.Aaa corporate bond yield.




TABLE 17: Conventional Mortgage Terms

DATE

NEW HOMES
CON- FEES &
TRACT CHARGES EFFEC- MATURITY
RATE
(PER
TIVE
(YEARS)
(PER
CENT) RATE
CENT)
3
2

LOAN/
PRICE LOAN
RATIO AMT.
(PER ($000)
CENT)
4

1

EXISTING HOMES
CON- FEES &
LOAN/
TRACT CHARGES EFFEC- MATU- PRICE
(PER
RATE
TIVE
RITY RATIO
CENT) &ATE (YEARS) (PER
(PER
CENT)
CENT)
2
3

LOAN
AMT.
($000)
4 '

1970
Aug.
Sept.
Oct.
Nov.
Dec.

8 .35
8 .31
8,.33
8,.26
8..20

0.98
1.03
1.05
0.99
1.07

8.52
8.48
8.51
8.43
8.38

24.8
25.2
25.1
25.3
25.8

71 .6
72,.7
72,.4
72,.1
73..8

25.5
25.3
24.8
25.2
25.8

8.25
8.27
8.20
8.18
8.12

0.89
0.88
0.88
0.85
0.85

8,.41
8,.42
8..35
8,.32
8..26

23.1
22.8
22.8
22.7
23.3

71.5
71.7
71.5
71.5
71.9

21.4
21.0
20.5
21.1
21.7

8.,03
7.,74
7.,52
7.,37
7.,36
7. 38
7. 51
7. 60

0.92
1.00
0.83
0.73
0.71
0.74
0.90
0.84

8.18
7.91
7.66
7.49
7.47
7.50
7.66
7.73

25.8
26.2
25.9
26.3
26.1
26.3
26.3
26.2

73. 3
73..9
73.,7
73.,6
74. 0
73. 7
74. 5
74. 0

26.4
26.2
26.0
26.2
26.7
27.2
27.1
26.5

7.94
7.67
7.47
7.34
7.33
7.38
7.50
7.59

0.82
0.79
0.77
0.75
0.71
0. 74
0.75
0.74

8..08
7..80
7.,60
7..47
7.,45
7. 50
7. 63
7. 71

23.5
24.0
24.1
24.2
24.0
24.3
24.2
24.4

72.5
73.1
73.5
73.6
73.2
73.9
74.5
74.4

22.0
22.5
23.0
23.1
23.3
28.3
23.2
23.4

1971
Jan.
Feb.
Mar.
Apr.
May
June
July
Aug.

1.

Compiled by Federal Home Loan Bank Board in cooperation with Federal Deposit Insurance
Corporation. Data are weighted averages based on probability sample survey of characteristics of conventional first mortgages originated by major institutional lender
groups (including mortgage companies) for purchase of single family homes. Data exclude loans for refinancing, reconditioning or modernization; construction loans to
home-builders; and permanent loans which are coupled with construction loans to ownerbuilders. Related series on conventional mortgage rates only, based on unweighted
opinions of field-office directors of the Federal Housing Administration, are available
somewhat sooner than the results of the FHLBB-FDIC survey, and are included-in the case
of new home mortgage rates--in Table 16.

2

Fees and charges—expressed as a percentage of the principal mortgage amount--include
loan commissions, fees, discounts, and other charges which provide added income to the
lender and are paid by the borrower. They exclude any closing costs related solely to
transfer of property ownership.

3

Includes fees & charges amortized over a.10 year period in addition to the contract
interest rate.

4

Derived by FRB.

?
(