Full text of H.16 Capital Market Developments : October 26, 1971
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mmofriAi WOiriROlLED AFTER SIX MONTHS L . 5 . 8 Confidential ( F . R . ) CAPITAL MARKET DEVELOPMENTS October 26, 1971 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 n.a. Revised Not available TABLE 1: Yields, Volume and Reception CORPORATE BOND MARKET WEEK ENDING: 1971 - Sept. Oct. 3 10 17 24 7.38 7.21 7.56 7. 60 7.45 7.42 7.44 7.44 1 8 15 22 29 7.53 7.30 7.22 7.17 n.a. 7.46 7.44 7.42 7.37n.a. W E E K ENDING: 1971 - Sept. Oct. YIELDS MOODY1S SEASONED NEW ISSUE 1 Aaa S YIELDS BOND BUYER . MOODY'S SEASONED 20 SEASONED Aaa BOND INDEX GROSS OFFERINGS ' VOLUME 2 PER CENT SOLD BY END BONDS SCHEDULED OF W E E K WITHIN 28 DAYS 413 285 673 832 54 77 93 90 n.a. n.a. n.a. n.a. 123 371 471 575e 65 Oe 82, 77 74 94 n.a. n.a. n.a • n.a. MUNICIPAL BOND MARKET VOLUME 2 GROSS OFFERINGS PER CENT SOLD BY END OF WEEK 1 1 BONDS SCHEDULED 1 WITHIN 28 DAYS 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 67 805 848 910 1,397 1 8 15 22 29 4.90 4.80 4.65 4.65 n. a. 5.24 5.17 4.99 4.97 991 368 327 439 515e 73 75 68 57 955 833 1,180 1,290 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 1 AMOUNT (MIL. $) 50.0 70.0 32.0 20.0 40.0 100.0 25.0 100.0 10/21 10/19 10/19 10/18 10/14 10/14 10/14 10/5 DATE OFFERED | RELEXSED | CORPORATE BONDS IN SYNDICATE END OF LATEST WEEK RATING AND ORIGINAL YIELD CALL PROTECTION •> ISSUER COUPON Combust Eng Carolina P & L Houston Nat. Gas Carolina Tel & Tel Ohio Pwr Co M f g Han. Trailmobile Fin Ohio Bell , 7.45 7.75 7.87 7.75 6.63 6.50 7.50 6.38 7.45 7.75 7.92 7.70 6.55 6.50 7.41 6.38 A A Baa A A N.R. -- Aaa 10 5 5 5 5 B yrs yrs yrs yrs yrs -- 6 yrs 6 yrs ESTIMATED PROPORTION SOLD 80% 90% 80% 50% 80% 50% sk% 65% CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK ORIGINAL INCREASE RATING AND ESTIMATED PROIN YIELD CALL PROT. PORTION RELEASED ISSUER COUPON AMOUNT YIELD NONE INVENTORIES 1 MUNICIPALS BLUE LIST | IN SYNDICATE DATE 971 - S e p t . Oct. CORPORATES IN SYNDICATE 24 630 111 84 1 8 15 759 872 816 308 242 169 31 85 144 22 850 261 127 N.C. - No call protection. « 1 All figures in millions of dollars. Blue List is daily average for week ended Friday, except for latest week * • which is daily average of three days ended Wednesday. All other figures are as of Friday. TABLE 3: High Grade Bond Yields 1969 -High Low NEW CORPORATE Aaa1 8.85 (12/5) 6.90 (2/21) 1970 -High Low 1971 -High Low DATE 1971 -Sept. Oct. MOODY'S- SEASONED CORPORATE Aaa 2 U.S. GOVERNMENT 20-YEAR CONSTANT MATURITIES 3 BOND BUYER'S SEASONED MUNICIPALS 4 7.84(12/26) 6.55 (1/12) 6.97 (12/26) 5.96 (1/24) 6.90 (12/18) 4.82 (1/28) 9.30 (6/19) 7.68 (12/18 8.60 (7/3) 7.48 (12/31) 7.55 (5/29) 6.17 (12.18) 7.12 (5/29) 5.33 (12/11) 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) 4.97 (10/21) 17 24 7.56 7.60 7.44 7.44 6.08 6.09 5.38 5.48 1 8 15 22 7.53 7.30 7.22 7.17 7.46 7.44 7.42 7.37 6.01 5.95 5.90 5.93 5.24 5.17 4.99 4.97 New corporate issues, with call protection, adjusted (as described in footnote 1 of Table 1) to a Aaa basis. 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 o'f the 20 bonds used in this index ' falls midway between the four top groups as classified by Moody's Investors Service. Note--Highs and lows are for individual series and may be on different dates for different series. 1 2 - 6 TABLE 4: Long-term Corporate and State and Local Government Security Offerings and Placements (In millions of dollars) GROSS PROCEEDS CORPORATE 1 PERIOD 1971 1970 STATE A N D LOCAL 2 1969 1971 January February March 3,115 3,000 6,075 2,636 1,802 3,539 2,075 2,045 2,098 2,705 1,839 2,144 1,340 1,214 1,555 1,262 1 987 ; 538 : April May June 4,007 3,271 4,375 3,170 3,909 2,748 2,076 2,530 1,907 2,135 2,008 1,647 996 1,085 1,801 r 1,110 I 737 1,928 1,871 2,050e 1,348 1,359 1,758 1,097 •• 1,924 1,748 2,190 1,280 \ 886 > July August September October November ^December 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter 1st half Three quarters . Year 4,064 2,850e 4,120e - 12,190 11,654 ll,034e 23,844 34,878e 3,389 i 1 j 1970 1969 .ft ss ?• 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 6,688 6,050 5,849 4,109 "3,728 4,465 5,862 2,787 3,648 2,464 2,982 18,445 27,005 38,944 13,572 19,904 26,744 12,738 18,587 7,837 12,302 18,164 6,435 f 8,899 4 11,881 , i | • 8 1 6 ; f r ; | \ 1 2 Securities and Exchange Commission estimates of gross proceeds. Investment Bankers Association of Ameriea estimates of principal amounts. I TABLE 5: New Corporate Security I s s u e s , Type of Issue and Issuer (In millions of dollars) QUARTER OR MONTH 1970 - III IV 1971 - I II Ille TOTAL 8,560 11,938 12,190 11,688 11,034 GROSS PROCEEDS BY TYPE OF ISSUE COMMON AND ISSUES INCLUDED PUBLICLY PRIVATELY PFD. PLACED STOCK FOREIGN CONVERTIBLE OFFERED ~ 287 9 T 5 ~ 1,659 83 57 937 ~ " 737 7,827 1,421 2,690 226 8,369 1,516 724 2,306 84 6,546 3,384 1,758 215 1,351 4,731 4,516 1,787 772 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 1971 - Jan. Feb. Mai. 3,115 3,000 6,075 2,033 594 275 647 489 524 1,293 43 3 38 168 4,042 3,271 4,375 4,064 2,850 4,120 2,116 507 491 760 537 500 750 1,419 633 1,332 2,196 950 1,370 116 47 52 64 Apr. May June July e/ Aug. e/ Sept. 1 2,201 4,135 2,148 2,282 1,331 1,400 2,000 99 557 : 384 255 712 197 300 275 GROSS PROCEEDS BY TYPE OF ISSUER MFG. PUBLIC UTILITY COMMUNICATIONS OTHER ISSUERS 1 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 2,663 4,020 3,594 4,753 4,277 994 1,241 1,006 676 1,069 1,452 391 683 532 1,332 587 1,675 1,267 588 1,055 721 273 405 1,367 1,48% 1,897 1,192 1,215 1,870 716 661 2,417 1,135 588 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. 282 1,350 955 529 485 825 445 371 693 838 1,300 1,033 1,687 1,101 1,107 1,056 1,206 896 2,362 800 1,035 218 1,622 350 390 \ . T A B L E 6: Large Long-term Public Security I s s u e s for New Capital . V (Other than U.S. T r e a s u r y ) 1 ' / \ Oct. 1 thru Oct. 22, 1971 ISSUER TYPE2 AMOUNT (MILLIONS OF DOLLARS) COUPON RATE OR NET INTEREST COST MATURITY / OFFERING YIELD MOODY 1 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 Massmutual Mtge & Realty Inv Florida Pwr Co Pacific Pwr & Light Co Gulf Pwr Co Trail Mobile Finance Co Ohio Power Co Consolidated Food Corp Coastal State Gas Producing Union Tank Car Mfg Hanover Trust Carolina Tele & Telegraph Firestone Rubber Co Carolina Pwr & Light Co Houston Natural Gas Corp Borg-Warner Acceptance Corp Texfi Industries Inc FMC Illinois Pwr Co Illinois Pwr Co Portland Gen'l Elec Co Portland Gen'l Elec Co KempercS, Inc International Harvester Credit Debs 1st mtg Com stk Notes Debs 1st mtg pipeline Com stk Debs 1st mtg 1st mtg Bonds Notes 1st mtg SF debs 1st mtg equip trst certf Debs Debs SF debs 1st mtg SF debs Debs Conv deb SF debs 1st mtg Com stk 1st M t g Com stk Com stk Notes 5.00 7.85 A 6.38 7.50 6.38 7.55 Aaa Aaa 1991 8.20 8.20 A 1991 2001 2001 2001 1978 6.75 7.38 .8.00 7.50 7.50 6.38 7.38 7.75 6.25 7.60 8.00 7.50 7.50 1991 1979 2001 2001 2001 1991 1991 1996 2001 2001 7.75 6.50 7."75 7.30 "7.75 7.88 7.88 4.75 7.50 7.60 7 . 75 6.50 7.70 " 7.37 7.70 7.92 7.88 4.75 7.50 7.60 2001 8.00 8.00 Baa 1976 7.00 6.95 — 60.0 40.0 50.2 50.0 100.0 1996 2001 -- -- 1978 2011 100.0 21.1 50.0 50.0 35.0 21.0 25.0 40.0 50.0 50.0 25.0 100.0 20.0. 100.0 70.0 32.0 30.0 25.0 75.0 35.0 21.2 20.0 20.5 22.5 60.0 1996 1991 5.00 7.88 ' -- — 7.38 7.75 Aa Baa Aa A A Aa A A n.r. A Aa A Baa — A Aa T A B L E 6: Large Long-term Public Security I s s u e s for New Capital (Other than U.S. T r e a s u r y ) 1 Oct. 1 thru Oct. 22. 1971 ISSUER TYPE2 - i AMOUNT (MILLIONS OF DOLLARS) MATURITY COUPON RATE-OR NET INTEREST COST OFFERING YIELD MOODY •s RATING State and Local Buffalo, N. Y. Buffalo, N.Y. Kentucky Turnpike, Auth Kentucky Turnpike, Auth Minneapolis, M i n n Minneapolis, M i n n Minneapolis, Minn Maine Maine Massachusetts Port, Auth Massachusetts Port, Auth, Chicago Public Bldg. Com, 111 Orlando, Utilities Comm, Fla Michigan, State of Dallas, Indp S/D Chartiers Valley Jt. Sch Bldg Auth, Pa Montgomery Co., Md Puerto Rico South Carolina New York Hawaii, State of Hawaii, State of \ Columbus, Ohio Michigan, State of New Orleans, La New Jersey M t g Fin Agency G.O. G.O. Rev. Rev. G.O. G.O. G.O. G.O. G.O. Rev. Rev. Rev. Rev. G.O. G.O. 8.3 18.3 13.5 71.5 3.6 4.4 2.2 13.8 8.0 19.9 58.1 25.0 33.5 50.0 17.5 1972-1990 1972-1985 1975-1991 2001 1973-1981 1973-1981 1972-1991 1990-1991 1972-1991 1975-1998 2001 1973-1991 1973-1998 1,972-2013 1972-1991 Rev G.O. G.O. G.O. G.O. Rev. Rev G.O. G.O. Airp Rev Rev 11.3 30.0 40.0 3.79 96.0 6.3 13.7 11.8 40.0 18.0 36.8 1972-1993 • 5.73 1972-2001 4.32 1973-1996' 4.82 1972-1987 3.87 1972-2001 4.28 1976-1985 5.89 1996 5.89 1974-1998 4.61 4.07 1973-1991 5.30 1972-1981 4.53 4.34 3.96 —— -- 4.43 3.66 4.20 4.27 4.23 J 4.96 4.85 4.17 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 2.90-5.40 3.10-6. 00 2.75-4. 70 —— 3.00 -: 3.10-5. 30 2.70-4. 90 4.30-5. 40 6.10 3.20-5. 00 2.90-4. 60 3.40-5. 45 3.10-4. 50 Aa Aa —— Aaa Aaa Aaa Aaa Aaa A-1 Aa A Aa BaaA-1 Aa Aa Aa Aa Baa T A B L E 6: Large Long-term Public Security I s s u e s for New Capital (continued) (Other than U.S. Treasury) 1 Oct. 1, throuth Oct. 22, ISSUER j TYPE 2 AMOUNT (MILLIONS OF DOLLARS) MATURITY COUPON RATE OR NET INTEREST COST | j OFFER ! UX j YIELD MOODY'S RATING Other Federal Land Bank Federal Land Bank Bonds Bonds 326.0 300.0 1974 1977 5.85 6.35 5,85 6.35 FHLB T.V.A. Bonds Pwr bds 200.0 150.0 1981 1996 7.36 6.60 6. 60 * 1 2 3 Rights o f f e r i n g . ^ Includes corporate and other security offerings df $15 million and oyer; State and local security offerings of $10 million and over. In case of State and local government securities, G.O. denotes genvrn1 obligation; Kev.-Ut., revenue obligations secured only by income from public utilities; Rev. -Q. -Ut. , revenue bonds secured only by income from quasi.ruti lities ;° 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. 1971 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) As of Oct 22, 1971 APPROXIMATE DATE OF OFFERING Corporate Debs Cenco Instrument Corp. Debs Engelhard Mineral & Chemical Notes Beneficial Corp. Debs Beneficial Corp. Debs Mountain Bell Notes Mountain Bell Consolidated Freightways, Inc. Debs Mtg Southwestern Elec Pwr Co. Debs Trans America Financial Corp 1st mtg Pacific Gas & Elec Co Debs Realty Income Trust Conv debs Beneficial Standard Mtg Inv. Debs Honeywell Finance Inc. S.F. debs Combustion Engr Inc. Debs Telex Corp 1st mtg Dallas Pwr & Light Co 1st mtg Metropolitan Edison Co. Debs Alison Mtg & Inv. Trust Com stk Detroit Edison Co Gen & ref mtg Detroit Edison Co Bonds G e n 1 1 Tel Co. of Michigan Com stk Penna Pwr & Light Co 1st mtg Consumers R*rr Co. 1st mtg Consumers Pwr Co Debs Baxter Laboratories Inc. 1st mtg Gulf States Utilities Co, Jersey Central Rtr & Light Co Bonds 1st mtg Cincinnati Gas & Elec. Co. New York State Elec & Gas Corp 1st mtg Debs Central Tel Co Notes . South Central Bell Tel Co Debs South Central Bell Tel Co. 1st mtg Public Service Elec & Gas Co Conv debs International Paper Co S.F. debs Alcoa 1st mtg Delmarva Pwr & Light Co Debs Pacific Lighting Service Co. 30.0 60.0 50.0 50.0 125.0 75.0 25.0 30.0 50.0 125.0 25.0 15.0 50.0 50.0 25.0 30.0 15.0 25.0 60.0 90.0 18.0 35.0 60.0 60.0 55.0 35.0 25.0 60.0 50.0 15.0 75.0 100.0 80.0 60.0 150.0 35.0 30.0 October October October October October October October October October October October October October October November November November November November November November November November November November November November November November November November November November November November November December 25 25 25 25 26 26 26 27 27 28 28 1 3 3 4 4 4 4 A 8 8 9 9 10 10 11 15 15 15 17 TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. T r e a s u r y ) 1 (continued) ISSUER TYPE AMOUNT (MILLIONS OF DOLLARS) As o f QCt. 22, 1971 APPROXIMATE DATE OF OFFERING State and Local North Dakota Detroit, M i c h Port of New York Auth Maryland California State Sacramento M U D , Cal, Salt River Proj Agric Imp & Pwr, Dist Erie Co, N.Y. Penna State Public Sch Auth Port of Seattle, Wash. Lucas Co, Ohio Tulsa M u n i , Airport, Okla Texas, State of L o s Angeles Co, Flood Contri Dist. Calif Washington Sub. Sanit, Dist, Md Triborouth Brdg & Tunnel Auth New York G.O. Rev. Rev. G.O. Rev. Rev 15.0 20.0 100.0 60.0 13.7 50.0 Oct. Oct. Oct. Oct. Oct. Oct. 26 26 27 27 27 27 G.O. G.O. Rev Rev. Rev. Rev. G.O. 52.0 14.0 15.7 22.3 11.1 27.5 31.5 Oct. Oct. Oct. Oct. Oct. Oct. Nov. 27 28 28 28 28 28 1 19.0 26.0 Nov. Nov. 2 3 55.2 50.0 100.0 10.3 32.0 10.0 150.0 25.0 45.0 26.0 10.4 10.0 33.1 15.0 17.0 150.0 43.0 50.0 Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. Nov. 3 4 4 8 9 9 9 10 10 11 11 17 17 17 30 G.O. G.O. Ref Imp Rev Los Angeles DWAPS Rev. Ohio, State of G.O. Akron, Ohio G.O. & Rev Rev. Broward Co, Fla Guilford Co. NC G.O. California G.O. Port of Portland, Ore Rev. Chicago City Sch Dist G.O. G.O. Essex Co., N.J. Wayne T.P. S/D N.J. G.O. Rev t o s Angeles Philadelphia, Pa G.O. Anne Arundel Co, Md G .O. Milwaukee, Wise i G.O. California, State of i G.O. New Jersey Housing Finance Agcy G.O. New York State Mtg Agcy Rev. * 1 2 Included in table for first time. Includes corporate and other issues of $15 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 nin-guaranteed issues of Federal Agencies. 13 , STOCK PRICES 1 - NYSE INDEX 3 - DJ.INDUSTRIALS TRADING VOLUME 2 AMEX 4 - High Low 5 0 . 3 2 (5/14) 49.31 (7/29) 968.85 769.93 (5/14) 3 2 . 9 1 ( 1 / 1 3 ) (12/17] 2 5 . 0 2 ( 7 / 2 9 ) 16.5 ( 3 / 2 9 ) 8.6 (8/29) 8.0 (1/31) 3.6 (11/21) 1970 - H i g h Low 5 2 . 3 6 (1/5) 37.69 (5/26) 8 4 2 . 0 0 (12/29 27.02 (1/8) 6 3 1 . 1 6 (5/26) 19.36 (5/27) 18.5 (12/4). 7.8 (8/14) 7.1 (1/2) 1.8 (8/14) High Low 5 7 . 7 6 (4/28) 48.73 (1/4) 9 5 0 . 8 2 (4.28) 26.68 ( 4 / 2 8 ) 2 2 . 7 2 (1/4) 8 3 0 . 5 7 (1/4) 22.1 (2/12) 6.7 ( 2 / 1 2 ) 2 . 7 (8/13) 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 54.66 54.94 54.06 52.82 893.98 893.91 874.85 852.37 25.54 25.71 25.37 24.95 11.4 14.8 12.3 13.9 1969 1971 Sept 3 10 17 24 15 22 11.0 ( 8 / 1 3 ) 10.8 12.2 3.1 3.3 3.2 2.8 3.1 4.1 3.8 3.5 NOTES: 1. Figures other than highs and lows are Fridays only. Highs.and lows are for the year and are not necessarily for Fridays. 2. NYSE is the New York Stock Exchange; AMEX is the American Stock Exchange. Volume figures are daily averaged for the entire week, (millions of shares). 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, 1969 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. 4 4-1/2 5 5 5 5 27-1/2 hours per week. periods, shown below: Hours/ Week 20 22-1/2 25 T A B L E 9: Security Credit END OF PERIOD CREDIT EXTENDED TO MARGIN CUSTOMERS BY: BROKERS 1 I BANKS 2 TOTAL CUSTOMERS' N E T DEBIT BALANCES NET CREDIT CUSTOMERS' NET EXTENDED BY BROKERS A N D FREE CREDIT DEALERS 3 BALANCES Outstanding; 1970 Aug. Sept. Oct. Nov. Dec. 1971 -Jan. Feb. Mar. Apr. -May June July Aug. 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 4,000 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 10 -60 140 30 50 30 171 153 -73 34 89 -60 120 240 210 90 150 100 70 291 291 55 -138 (4) (4) (4) (4) (4) (4) (4) (4) (4) (4) $ (4) 2,083 2,236 2,163 2,197 (4) (4) (4) (4) (4) 2,452 2,743 2,798 (4) (4) (4) (4) 44) (4) 2,286 2,660 2,550 2,440 2,210 2,200 $ Change in Outstanding 1970 Aug. Sept Oct. Nov. Dec. 1971 -Jan Feb. Mar^ Apr. May ^ June July Aug 10 110 90 30 -60 50 20 10 -30 90 210 230 90 -30 30 30 -20 100 70 50 30 60 10 -110 110 230 -10 Margin debt, as reported by the N e w 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' net debit balances and customers'net free credit balances, this figure represents the net credit extended by brokers and dealers to the nonfinancial public. 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 ife^ies2 ddis°c^ntxnued. Digitized for Changes FRASERin series. „ T A B L E 10: Savings Flows at Nonbank Depositary Intermediaries ($ millions) DATE MUTUAL SAVINGS BANKS REGULAR DEPOSITS 3 NET ANNUAL NEW MONEY2 GROWTH NET 1 FLOW RATE SAVINGS & LOAN ASSOCIATIONS NET SHARE CAPITAL NEW ANNUAL NET MONEY 2 GROWTH 1 FLOW RATE 4,203 2,549 4,466 7,432 4,200 11,173 TOTAL DEPOSITS ANNUAL NET GROWTH RATE 1 FLOW NET NEW MONEY 2 Not Seasonally Adjusted 1968 1969 1970 1970 - J u l y August September 297 176 575 1971 - J u l y August September j-J 416 300 775 1971 - April May June July August September ]>/ 1,176 795 818 566 425 625 7.0 4.0 6.7 —— 1,143 -763 936 \ 174 81 -8 -— 276 195 125 — -— 543 550 1,827 1,554 1,106 2,610 6.0 3.2 8.2 11,635 6,749 15,639 485 511 575 840 726 2,402 1,463 1,050 1,100 1,970 1,406 -- 3,385 -- 4,172 2,791 2,970 3,167 1,707 21.8 14.3 15.1 15.9 8.4 —— —— — --— 6.3 3.4 7.7 2,738 -1,003 5,295 3,881 -1,766 6,231 —— 659 592 567 1,714 1,245 1,225 Seasonally Adjusted 19.0 12.7 12.9 8.8 6.6 9.6 —— -— — . 2,996 1,996 2,152 2,601 1,282 2,099 23.1 15.1 16.1 19.2 9.3 15.1 " —— —— . • • 2,724 , 13.4 \ 1 2 3 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. — --— — -- X \ DATE TOTAL 1 TABLE 11: Mortgage Commitments at Selected Thrift Institutions 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, Se£ sonally Adjusted)—/ 70 - Aug. Sept. Oct. Nov. Dec. 9.8 8.9 9.3 9.6 10.1 6.8 7.1 7.5 7.8 8.1 2.0 1:8 1.8 1.8 2.0 .21 .25 .30 .35 .51 171 - Jan. Feb. Mar. Apr. May June July Aug. 10.4 11.2 12.6 13.8 15.3 16.1 16.3 16.4 8.3 8.9 X 10.1 11.1 12.2 13.0 13.2 13.3 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 1967. -.08 -.11 -.07 .01 .23 .05 .20 .20 .29 .34 .05 .02 .05 17 TABLE 12: Net Change in Mortgage Holdings TOTAL INCLUDING FNMA-GNMA TOTAL 1 FINANCIAL INSTITUTIONS MUTUAL SAVINGS & SAVINGS COMMERCIAL LOAN ASSOC. BANKS BANKS LIFE INSURANCE COMPANIES Not Seasonally Adjusted 20,016 23,781 24,189 21,822 18,219 21,273 19,814 16,913 2,063r 2,072 2,314 4,544 4,264 4,556 n.a. l,919 2,192 2,128 2,049 2,604 r 1,860 2,097 2,988 2,939 3,280 4,177 4,259 4,404r 1,600 1,673 1,952 4,411 3,948 3,930 4,639 6,677 5,404 2,462 200 300 500 1,300 2,682 1,845 160 182 216 435 389 415 n.a. Seasonally Adjusted 1,000 1,000 1,100 l,511r 268 1,828 1,808 1,820 329 295 224 312 383 445 2,504 1,893 2,184 2,996 2,018 3,273 3,972 3,898 3,770r 3,153 2,787 688 653 840 1,197 969 972 922 175 245 138 176 250 175 217 380 283 313 413 373 410 7,520 9,350 9,676 10,288 1,079 1,114 1,123 2,693 2,511 2,391 2,907 2,459 2,052 2,318 161r 77r 113 -17 48 124 2,088 983 1,104 1,175 1,289 1,710 1,311 1,425 1,774 2,044 2,095 2,339 2,484 2,2S8r 85 151 200 131 232 24 97 154 38 25 23 72 130 2,069 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 of minor conceptual differences for which adjustments are not made in the monthly s e r i e s . A l t o g e t h e r , these groups accounted for 8 4 per cent of the net increase estimated for all holders in 1 9 7 0 . 18 TABLE 13: Net Increases in Mortgage Debt Outstanding 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 5 2.8 t 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 2.3? 2.2; 1-8; i.s; 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 IV 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.i; 1971 - Ip HP 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" 2.3f ' Derived from data on mortgage debt outstanding from Federal Deposit Insurance Corporation, Federal Home Loan B a n k Board, Institute of Life Insurance, National Association of M u t u a l Savings Banks, Departments of Commerce and Agriculture, Federal"Rational 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. M a y 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. < TABLE 14: FNMA Weekly WEEK ENDED Auction" R e s u l t s COMMITMENTS IN $ MILLIONS ACCEPTED 1 -YEARH 90TOTAL 6TOTAL OFFERED MONTH & OVER DAY IMPLICIT YIELD 2 (per cent) 90DAY 1-YEAR & OVER 6M0NTH 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 7.98 8.07 8 .23 8.31 Aug. 25 634. 6 153.5 153.5 -- -- 7.97 -- Sept. 7 20 445.2 437.5 188.6 193.0 188.6 193.0 -— -- 7.88 7.86 —* 4 18 365.1 219.8 194.8 103.6 194.8.. 103.6^ - - 1971 - June ' xx Oct. 1 — -- ' •Y Note:^ Under the FNMA auction system, approved sellers of Governmentunderwritten mortgages bid for FNMA forward purchase commitments. 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 yield 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 3 8 basis points fe^ paid by investors to servicers. 3 <o. FNMA announced limit of accepted bids for next week's auction. 4 4-month commitment basis. . -/ ,... , < . . TABLE 15: Private Housing Starts and Permits STARTS UNADJUSTED TYPE OF FINANCING FHA VA OTHER SEASONALLY ADJUSTED ANNUAL RATE / TOTAL 1-FAMILY 2 OR MORE 1970 - Sept. Oct. Nov. Dec. 1971 Jan. Feb. Mar. Apr. May. June J u l y r/ Aug. r/ Sept. £ / 1,509 1,583 1,693 2,054 1,725 1,754 1,959 1,912 1,975 2,000 2,229 2,235 1,958 881 890 934 1,240 627 693 759 814 130.9 140.9 126.9 121.4 946 985 1,048 1,098 1,124 1,177 1,187 1,208 1,182 779 769 911 814 851 823 1,042 1,027 776 110.6 102.2 167.9 201.1 198.5 193.8 194.3 202.2 170.4 BUILDING PERMITS (SEASONALLY ADJUSTED ANNUAL RATE) 2 34.3 40.4 33.7 63.2 5.3 5.8 5.5 5.7 91.3 94.7 87.2 52.5 1,388 1,523 1,487 1,768 32.2 4.6 4.7 6.9 8.5 8.4 9.3 9.2 9.4 8.7 72.8 68.4 127.6 148.0 149.4 137.8 142. 2 147.0 1,635 1,563 1,627 1,638 1,927 1,849 2,052 27.3 33.4 44.6 40.7 46.1 42.9 45.8 2,006 1,967 Total starts are Census estimates including farm for both permit-issuing and noi»-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 guarantee 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 permit-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. 21 : TABLE 16: Mortgage and Bond Yields FHA MORTGAGES DATE 30-year 2 CONVENTIONAL MORTGAGES 3 SPREAD BETWEEN YIELDS ON C0NV. & FHA MORTGAGES 5 1 NEW Aaa CORPORATE BONDS 4 SPREAD BETWEEN YIELDS ON NEW CORPORATE BONDS AND FHA MORTGAGES 6 1969 - High Low 8.62 7.99 8.35 . 7.55 -.13 -.40 8.75 6.91 1.08 -.13 1970 - High Low 9.29 8.40 8.60 8.30 -.10 -.74 9.11 7.80 .99 .01 1971 - High 7.97 7.32 7.95 7.55 .28 -.19 8.01 7.24y .40 -.36 7.37 7.75 7.89 7.55 7.65 7.70 .18 -.10 -.19 7.57 8.01 7.90 -.20 -.26 -.01 7.97 7.92 7.84 7.80 7.85 7.85 -.17 -.07 .01 7.96 7.65 7.44 .01 .27 .40 O Low 1971 - Apr. May June July Aug. Sept. 1 2 3 4 5 6 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 opinions about average bid prices in the private secondary market for new-home mortgages for immediate delivery. Data shown are. for 30-year mortgages w i t h minimum downpayments, ajid 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 (PER (YEARS) RATE TIVE CENT) RATE (PER CENT) 3 2 LOAN/ PRICE LOAN RATIO AMT. (PER ($000) CENT) 4 1 EXISTING HOMES FEES & CONLOAN/ TRACT CHARGES EFFEC- MATU- PRICE (PER RATE TIVE RITY RATIO CENT) RATE (PER (YEARS) (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.
@FedFRASER