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'/jityu. DECONTROLLED AFTER SIX HOHTHS L . 5 . 8 Confidential (F.R.) •I / * D OF")September 1 5 , r ~ = - T CAPITAL U4ARKEL.„_ DEVELOPMENTS Capital Markets Section, Division of Research and.Statistics, Board of Governors of the Federal Reserve System, Washington, D. C. 1969. 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 / TABLE 1: Yields, Volume and Reception WEEK ENDING: 1969 - Aug. Sept. 1 8 15 22 29 Sept. | | | CORPORATE BOND MARKET VOLUME2 •PER CENT GROSS SOLD BY END BONDS SCHEDULED OFFERINGS OF WEEK WITHIN 28 DAYS' 7.75 7.57 7.53 7.61 7.82 7.05 7.01 6.96 . 6.95 6.98 243 148 208 189 141 97 99 80 78 86 467 468 562 513 902 5 . 7.90 12 8.05 19£ f n. a. r/7.05 7.12 n. a. 204 310 400e 90 100 1,179 982 , WEEK ENDING: 1969 - Aug. YIELDS MOODY'S SEASONED 1 NEW ISSUE Aaa 1 8 15 22 29 5 12 19£/ YIELDS MOODY'S BOND BUYER SEASONED SEASONED 20 BOND INDEX 5.78 5.93 5.70 5.80 5.73 5.9.1 5.73 6.02 5.80 6.26 5.80 5.85 n.a. 6.37 6.33 n.a. n.a. MUNICIPAL BOND MARKET VOLUME2 PER CENT 1 GROSS BONDS SCHEDULED SOLD BY END OF WEEK WITHIN 28 DAYS OFFERINGS 141 268 319 r/177 r/148 86 132 lOOe 97 80 64 61 48 542 405 392 365 644 80 77 547 545 n.a. 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.) I 2 Millions of dollars unless otherwise indicated. I n.a. Note: See footnotes to Table 3 TABLE 2: Details on Inventories DATE OFFERED AMOUNT • (MIL. $) 9/10 10.0 DATE OFFERED | RELEXSED 9/4 9/4 9/10 9/10 CORPORATE BONDS IN SYNDICATE END OF LATEST WEEK ORIGINAL RATING AND YIELD CALL PROTECTION COUPON ISSUER Wisconsin National Gas 8-3/4 8.60 A iESTIMATED PROPORTION SOLD 5 years 95% V . CORPORATE BONDS RELEASED FROM SYNDICATE DURING LATEST WEEK ORIGINAL INCREASE RATING A N D ESTIMATED PROAMOUNT ISSUER COUPON IN YIELD CALL PROT. PORTION RELEASED YTETiD 100.0 R. J. Reynolds R. J. Reynolds 50.0 DATE 1969 - Aug. 15 22 29 Sept. 5 12jd/ 7-7/8 8-1/8 INVENTORIES 1 MUNICIPALS BLUE LIST | IN SYNDICATE 367 453 455 r/359 339 112 125 141 74 50 7.90 8.13 10 Aa Aa 10 yrs. 5 yrs. 10% 157= CORPORATES IN SYNDICATE 42 90 23 21 1 N.C. - No call protection. Digitized 1 for FRASER All figures in millions of dollars. which " u is daily average of three days Blue List is daily average for week ended Friday, except for latest week ended Wednesday. All other figures are as of Friday. BONDS IN SYNDICATE Millions of dollars 200 100 i—i—i—| i l i t . i—r i—i—i .i MUNICIPAL BONDS IN SYNDICATE i—i i i,i-i—r 300 200 100 SEPT. DEC. '67 JUN. 1968 SEPT. DEC. MAR. JUN. . 1969 SEPT. TABLE 3: High Grade Bond Yields 1967 - High Low , NEW CORPORATE Aaa 1 6.55(12/8) 5.11(2/10) 1968 - High Low 7.02(12/13) 6.13(8/30) 1969 - High Low 8.05(9/12) 6.90(2/21) 1969 - Aug. 7.75 7.57 7.53 7.61 7.82 7.90 8.05 DATE 1 8 15 22 29 Sept. 5 12j>/ 1 MOODY'S SEASONED CORPORATE Aaa? 6.24(2/29) 5.00(2/10) 1 U.S. GOVERNMENT 20-YEAR CONSTANT MATURITIES3 5.73(11/7) 4.48(1/20) BOND BUYER'S SEASONED MUNICIPALS4 4.45(12/7) 3.40(2/2) 6.55(1/27) 5.95(9/13) 5.90(1/20) 5.18(8/9) 7.12 (7/12) 6.55(1/3) 6.46(9/12) 5.96(1/24) 6,37(9/4) 4.82(1/28) 6.26 6.18 6.21 6.20 6.28 6.41 6.46 5.93 5.80 5.91 6.02 6.26 6.37 6.33 7.05 7.00 6.96 6.95 6.98 r/7.05 7.12 xx 4.85(12/26) 4.07(/8/8) 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. Note--Highs and lows are for individual series and may be on different dates for different series. HIGH GRADE BOND YIELDS Per cent NEW CORPORATE Aaa MOODY'S V CORPORATE Aaa U.S. GOVT. 20-YR. CONSTANT MATURITIES BOND BUYER MUNICIPAL Aaa 1965 1966 1967 1968 1969 TABLE 4: Long-term Corporate and State and Local Government Security Offerings and Placements (In millions of dollars) . PERIOD " 1969p GROSS PROCEEDS 1 STATE AND LOCAL 2 CORPORATE 1968p 1967 / • January February March 2,075 2,045 2,098 1,771 1,608 1,799 1,684 1,418 .2,362 April 2,748 2,076 2,480 1,428 1,866 2,411 2,015 1,518 2,674 m y June July August September 2,360e l,600e 2,250e 2,143 1,432 1,557 2,589 2,481 1,763 2,129 1,767 2,054 2,409 1,500 2,385 6,218 7,304 6,210e 5,178 5,704 5,133 5,950 5,464 6,208 6,832 ' 6,294 13,522 10,882 16,015 21,965 October 'November December 1st 2nd 3rd 4th Quarter Quarter Quarter Quarter 1st half Three quarters Year 19,732e 11,672 18,504 24,798 j 1969 p •1 • ! J j i ! 1 j ! ' 1967 1966p 1,263 988 .540 1,178 1,158 1,404 1,800 1,113 711 1,318 1,143 1,395 1,063 820e " 500e 1,469 1,699 1,444 950 860 1,340 2,230 1,021 1,115 975 1,401 1,182 2,791 3,624 2,383e 3,740 3,856 4,612 4,366 4,177 3,881 3,150 3,557 6,415 8,798e 7,956 12,008 16,574 8,059 11,209 14,766 1,492 1,236 1,450 - 1,130 1,254 1,497 Excluding finance companies 3 1st .. 2nd 3rd 4th Quarter Quarter Quarter Quarter Year 5,107 5,427 4,785 5,654 5,308 6,063 6,584 5,859 20,973 23,814 Securities and Exchange Commission estimates of gross proceeds. Investment Bankers Association of America estimates of principal amounts. Total gross proceeds excluding offerings of sales and consumer finance companies. TABLE 5: New Corporate Security Issues, Type of Issue and Issuer (In millions of dollars) . QUARTER OR MONTH . 1968 - I II III IV 1969 - I lie/ 1968 - Aug. Sept, Oct. Nov. Dec. 1969 - Jan. Feb. Mar. Apr. May June 1 GROSS PROCEEDS BY TYPE OF ISSUE COMMON MEMO: AND BONDS MFG. ISSUES INCLUDED TOTAL PUBLICLY PRIVATELY PFD. STOCK FOREIGN I CONVERTIBLE PLACED OFFERED 5™17B 5,705 5,133 5,951 6,218 7,304 1,433 1,556 2,129 1,767 2,055 2.075 2,045 2,098 2,748 2.076 2,480 2,360 2,465 3,105 2,606 2,555 2,657 3,411 637 727 1,009 939 607 . 980 842 835 1,268 871 1,272 1,360 700 1,724 1,644 1,361 1,922 1,540 1,623 400 433 595 362 965 636 395 509 649 510 464 500 500 989 956 1,166 1,474 2,023 2,268 396 398 525 466 483 460 808 755 830 694 744 500 400 313 172 124 113 215 227 584 758 1,037 902 1,355 1,077 49 211 28 221 365 211 326 376 578 401 430 463 184 24 49 40 103 74 38 62 28 137 1 , 907 1, 703 1,,657 1,,712 1.,407 1 ,723 GROSS PROCEEDS BY TYPE OF ISSUER PUBLIC UTILITY 1,442 1,244 1,160 1,435 1,346 1,878 362 453 640 421 651 403 513 491 513 569 641 n. a. 475 200 250 300 n.a. — 1T600 real estate Other issuers are extractive railroad and other transportation, and finance, and commercial and other. Quarterly supplements are availSource: Securities and Exchange Commission able. 446 475 674 443 319 627 315 404 784 392 COMMUNICATIONS 422 536 490 319 473 432 95 156 115 162 41 186 702 56 231 44 • 197 191 370 450 300 175 ISSUERS1 1,407 2,223 1,825 2,483 2,993 3,266 530 472 700 741 1,044 860 1,161 972 1,405 915 - 946 1>: 725 TABLE 6:, Large Long-tprm Public Security Issues for New Capital (Other than U.S. Treasury) 1 tember 15. 1969. September 2 th; ISSUER TYPE2 COUPON RATE OR. NET INTEREST COST OFFERING YIELD 1994 1999 6 8.20 6.,00 8.20 N.R, Aa 1994 1974 7-7/8 8-1/8 7.,90 8..13 Aa Aa 1994 1994 2005 6.00 7-7/8 8-1/4 6.00 7.90 8. 14 Baa Aa Aaa . AMOUNT (MILLIONS OF MATURITY DOLLARS),, MOOIW' S RAT INC. Corporate Conv. debs. 1st mtg. Conv. cum. pfd. stk. R. J. Reynolds Tabacco Co. S.F. debs. R. J. Reynolds Tabacco Co. Notes Saxon Industries Com. stk. -Phillip Morris Inc. Conv. debs. Beatrice Foods Company S.F. debs. Southwestern Bell Tel. Co. Debs. Price Capital Corporation Com. stk. First Mtg. Investors Benef. Int. Society Corporation Long Island Lighting Co. Weyerhaeuser Company 15.0 35.0 25.0 100.0 50.0 15.6 100.0 35.0 150.0 16.0 16.7 TABLE 6. Large Long term Public Security Issues for New Capital (contimu d) (Other than U.S. Treasury) 1 September 2 through September 15, 1969. COUPON RATE OR NET INTEREST COST AMOUNT (MILLIONS OF DOLLARS) iM-'FKRi;.( YIELD MOODY'S RATING •State & local Government Oregon, State of . Houston, Texas St. Louis Co., Missouri Newark, New Jersey G.O. Rev. bds. G.O. V.P. 47.0 1983/84/87 24.0 " 1990-2003 13.0 1970-79 20.5 1970-90 6.40 6.49 . 5.80 7.68 6.15-6.25/40 Aa 5.25-5.75 6.20-7.40 Aa Baa Other Federal Land Bank Federal Home Loan Bank Bights offering. Bonds Bonds 337.0 250.0 (1972) 1971 8.35 8.38 8.35 8.38 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 .general. ohl gat i o n ; [(ev. -Ut . , revenue obligations secured only by income from public .'uti 1 i ties ; Rev.-Q.-lit., revenue bonds secured only by income from qUasi-uti Iities; Rev -S.T., revenue bonds secured by revenue from specific taxes only; Rev.-Rent., rev, 1 bonds secured solely by lease payments. Includes foreign government and International Bank for Reconstruction and Development issues and non-quaranteed issues by Federal Agencies. , TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S. Treasury)1 . ISSUER (continued) AMOUNT (MILLIONS OF TYPE DOLLARS) As of September 15, 1969. APPROXIMATE DATE OF OFFERING State & local Government *Puerto Rico Urban Renewal and Housing. Corp. Newport News, Virginia Alaska ' West Virginia, State of Warren Consolidated Sch. Dist., Michigan Louisiana, State of -Memphis, Tennessee Los Angeles Dept. of Wtr. and Pwr. Los Angeles Co. Flood Control Dist. Bonds G.0, G.O. Bonds 25.7 16.0 10.2 18.3 September September September September Bonds Bonds G.O. 13.0 15.0 30.0 September 24 September 30 September 30 Rev. 39.0 October 8 Bonds 15.0 October 14 Bonds Bonds Bonds 19.7 200.0 100.0 16 16 17 18 Other . Isbrandtsen Lines Inc. HAA Tennesse Valley Auth. * 1 September 18 September 24 October 7 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. 2 Includes foreign government and International Bank for Reconstruction and Development issues and non-guaranteed issues of Federal Agencies. Postponed this week were: % u m Industries Inc., 18.0 postponed due to market conditions. Credithrift Financial Corporation, 20.0 cancelled due to market conditions. Jefferson Parish-wide School District, La., 10.0 no bids received due to 6% ceiling. International Bank, 30.0 cancelled due to market conditions. Chicago Park District, Illinois, 10.0 issue reduced 9.5. Washington State Bd. for Commission Education, 22.0 bid rejected. Wayne Co., Michigan, 20.0 no bids received interest rate limitation. TABLE 7: Forthcoming Large Long-term Public Security Offerings for New Capital (Other than U.S . Treasury)1 • ISSUER Corporate TYPE " APPROXIMATE DATE OF OFFERING j Conv. sub. debs. Computer Sciences Corp. Avco Delta Corporation S.F. debs. *Diversified Mtg. Investors Conv. debs 1st pipeline Tenneco Inc. Debs. Chemetron Corporation Ohio Edison 1st mtg. Monsanto Company S.F. debs. Gulf States Utilities Co. 1st mtg. *United Telephone Co. of 1st mtg. Ohio Conv. sub. debs. Hublein Inc. North Indiana Public 1st mtg. Service Co. *General Acceptance Corp. Sr. debs. 1st mtg. New England Pwr. Co. . Panhandle East. Pipeline Co,Debs. Panhandle East. Pipeline Co, Pfd. stk. Conv. debs, U.S. Bancorporation 1st & Ref. Baltimore Gas & Elec. 1st mtg. Washington Gas Light Co. Transcontinental Gas Pipe1st pipeline line Corporation Consolidated Edison Co. Com, stk. of New York Cincinnati & Suburban Bell Debs. Telephone Co. *New England Telephone & Com. stk. Telegraph Company Conv. sub. debs. First & Merchants Corp. 1st mtg. Northern States Pwr. Co. Debs. Columbia Gas System Inc. General Telephone Co. of 1st mtg. Illinois 1st mtg. Dayton Pwr. & Light Co. 1st mtg. *Illinois Pwr. Co. Bonds ^Appalachian Pwr. Co. National Health Debs. Enterprises Inc. Conv. debs. Collins & Aikeman Investment Properties Bonds Association As of September 15, 1969. AMOUNT (MILLIONS OF DOLLARS) 50.0 30.0 50.0 50.0 40.0 40.0 150.0 25.0 September September September ~~ September September September September September 15 15 16 16 16 16 17 18 30.0 50.0 September 18 September 18 20.0 50.0 15.0 40.0 20.0 25.0 25.0 20.0 September September September September September September September September 18 18 22 22 22 22 23 23 50.0 September 24 55.3 September 29(rts.exp.) 35.0 September 29 42.4 20.0 45.0 50.0 September 30(rts.exp.) September October 1 October 2 15.0 30.0 35.0 60.0 October October October October 15.0 15.0 October October 78.8 October 7 8 9 16 TABLE 8: Stock Prices and Volume TRADING; VOLUME 2 STOCK PRICES \ DATE S&P 500 3 ' 1967 - High Low 97.59(9/25) 80.38(1/3) D.J. - IND. AMEX 4 NYSE AMEX 943.08(9/25) 24.52(12/29) 786.41(1/3) 13.78(1/27) 60.7(8/14) 27.41(1/6) 33.5(10/27) 8.3(1/6) 1968 - High Low 108.37(11/29) 985.21(12/3) 33.24(12/20) 87.72(3/5) 801.96(7/29) 22.00(3/22) 82.1(6/7) 34.0(2723) 45.4(6/7) 14.1(2/23) 1969 - High Low 105.94(5/16) 91.96(7/25) 968.85(5/14) 32.91(1/3) 801.96(7/29) 25.02(7/29) 72.7(5/2) 32.8(4/4) 38.4(5/9) 12.9(4/4) 93.94 94.00 95.92 95.51 824.46 820.88 837.25 836.72 26.33 26.37 26.80 26.88 48.9 44.4 50.3 43.0 17.2 15.6 19.0 16.6 Sept.5 93.64 12£ f 94.35 819.50 824.25 26.3426.38 35.6 54.0 12.4 19.6 1969 - Aug. 8 15 V 22 29 l 2 Figures other than highs and lows are Fridays only. Highs and lows are for the year and are not necessarily for Fridays. Total number of shares traded per week (millions of shares). In the past, trading was normally conducted 5 days a week for 5 1/2 hours per day, or 27 1/2 hours per week. From August 8 through August 20, 1967, daily trading was reduced to 4 hours per day or 20 hours per week. A ZO-hour week was also in effect from January 22 through March 1, 1968. From June 30 through December 31, 1968, the exchanges were open 5 1/2 hours for 4 days ; a week or 22 hours. From January 3 through July 3, 1969, the exchanges were open 4 hours each day, 20 hours per week. Beginning July 7, 1969 the exchanges have been open 4 1/2 hours each day, 22 1/2 hours per week. NYSE is New York Stock Exchange; AMEX is American Stock Exchange. 3 1941-43 = 10. 4 Average dollar value of shares listed. 15 STOCK PRICES AND TRADING VOLUME AMEX Weekly STOCK PRICES AMEX PRICE LEVEL INDEX S&P's 500 AMEX TRADING VOLUME (TOTAL FOR WEEK) .,,l| ill III. NYSE TRADING VOLUME (TOTAL FOR WEEK) ,lh, .1 !!f j/ $ I li J 1 U ii !:llii!,i!ili!lliiliiiilliii;!!ilii^ lili!:.:-:!i!u!!ii:,.!i TABLE 9: Security Credit END OF PERIOD CREDIT EXTENDED TO , MARGIN CUSTOMERS BY: BROKERS 1 | BANKS 2 J TOTAL CUSTOMERS' NET DEBIT BALANCES NET CREDIT CUSTOMERS' NET EXTENDED BY BROKERS AND FREE CREDIT DEALERS 3 BALANCES Outstanding: 1968 - July 6,500 6,460 Aug. Sept. ^ 6,390 Oct. 6,250 6,200 Nov. 6,200 Dec. 1969 - Jan. Feb. • Mar. Apr. May June rj' July ' 5,930 5,750 5,590 5,570 5,670 5,340 5,190 2,420 2,490 2,520 2,560 2,630 2,710 8,920 8,950 8,910 8,810 8,830 8,900 8,861 8,489 8,724 8,859 9,029 9,970 3,269 2,984 3,126 3,407 3,419 3,717 5,592 5,505 5,590 5,452 5,610 6,073 2,750 2,810 2,780 2,760 2,770 2,740 2,700 8,680 8,560 8,370 8,330 8,440 8,080 7,890 9,042 9,148 8,318 8,044 8,474 8,214 7,515 3,597 3,647 3,294 3,077 3,084 3,085 2,783 5,445 5,501 5,024 4,967 5,390 5,129 4,732 10 70 30 40 70 80 -180 30 -40 100 20 80 133 -371 235 135 170 761 -24 -285 142 281 12 298 156 -86 85 -138 158 563 40 60 -30 -20 10 -30 -40 -220 -120 -190 -40 110 -360 -190 -928 -51 -830 -274 430 -260 -699 -120 50 -351 -217 7 1 -302 -628 -9 -477 -57 423 , -261 -397 . Change in Outstanding: 1968 - July Aug. Sept. Oct. Nov. Dec. 1969 1 2 3 - Jan. Feb. Mar. Apr. May June ry July £/ -190 -40 -70 -140 -50 --270 -180 -160 -20 100 -330 -150 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' 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 regulated or not. T A B L E 10: Savings Flows at Nonb'ank Depositary Intermediaries ($ millions) DATE MUTUAL SAVINGS BANKS REGULAR DEPOSITS 3 NET , ANNUAL NEW ' MONEY2 GROWTH NET FLOW RATE 1 SAVINGS < St LOAN ASSOCIATIONS NET SHARE CAPITAL 2,557 5,082 4,186 3,584 \ 10,687 7,396 ANNUAL GROWTH RATE 1 NET FLOW NEW MONEY2 TOTAL DEPOSITS ANNUAL NET GROWTH RATE 1 FLOW NET NEW MONEY 2 Not Seasonally Adiusted 1966 1967 1968 1968 - May June July 1969 - May June July 1969 - Feb. Mar. Apr. May June July . 1 2 3 363 453 186 4.9 9.3 7.0 —— — 308 323 ' -164 \ — 384 382 160 357 175 -45 7.2 7.1 3.0 6.6 3.2 -0.8 —— 227 2,376 1,143 3.2 9.4 5.9 300 -111 64 757 1,622 -605 __ 227 „ -266 -266 641 1,359 -1,062 __ — —— -— -- --- -552 6,129 2,676 6,141 15,769 11,582 722 158 -606 1,120 2,075 -419 602 949 -116 1,682 -1,075 >1,226 1• Seasonally Adiusted 582 894 190 498 491 8 — 5.3 8.1 1.7 4.5 4.4 0.1 —— --—— 966 1,276 350 855 666 -37 3.8 9.4 6.3 —— -- -- -325 8,505 3,819 1,022 47 -542 829 -382 •1,341 • " | •' 5.9 7.8 • 2, 1 5,2 4.0 -0.2 —— •* T "1 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. SAVINGS FLOWS (seasonally adjusted) Monthly Millions of dollars 2000 1600 .TOTAL 1200 800 400 400 1200 SAVINGS & LOANS 800 400 400 800 MUTUAL SAVINGS BANKS 400 400 1965 1966 1967 1968 1969 / T A B L E 11: Mortgage Commitments at Selected Thrift Institutions DATE TOTAL OUTSTANDING COMMITMENTS . I ALL MUTUAL I . SAVINGS TOTAL SAVINGS & ' BANKS LOAN . (N.Y. STATE) ASSOCIATIONS '/ NET CHANGE \ ALL SAVINGS & LOAN ASSOCIATIONS (Billions of Dollars, Seasonally Adjusted) 1/ MUTUAL SAVINGS BANKS (N.Y. STATE) \ 1968 - July Aug. Sept. Oct. Nov. Dec. 1969 - Jan. Feb. Mar. Apr. May June' July J>/ 8.8 9.0 9.1 9.5 9.7 9.7, 9.9 10.1 10.3 10.5 10.3 10.2 9.9 6.1 6.1 6.2 6.4 6.5 6.6 2.7 2.9 2.9 3.0 3.2 3.1 .24 .16 .14 .35 .27 -.01 6.7 6.9 7.0 7.2 7.1 7.0 6.8 3.2 3.2 3.3 3.3 3.2 3.2 3.1 .15 .25 117 .19 -.19 -.09 -.28 .16 ' ' . 10 .22 .10 .08 .08 .22 .09 . 18 -.10 -.05 -.20 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 . 16 / .04 .13 .17 -.10 .07 . 03 .08 .01 -.09 -.04 -.08 MORTGAGE COMMITMENTS OUTSTANDING (seasonally adjusted) Monthly Billions of dollars TOTAL S&L'S N.Y.-MSB'S Includes building loans beginning August 1967 1960 1962 \ 1964 1966 1968 1970 22 TOTAL INCLUDING FNMA-GNMA TABLE 12: Net Change in Mortgage Holdings 1 (millions of dollars) FINANCIAL INSTITUTIONS 1 MUTUAL SAVINGS & TOTAL COMMERCIAL • SAVINGS LOAN BANKS BANKS ASSOC. 1 18,197 19,988 23,807 15,874 18.191 21,399 1968 - Apr. May June July 1969 - Apr. May June July 1,978 2,238 2,125 1,851 2,202 2,165 2,41* 1,732 2,003 1,905 1,699 2,011 1:980 2,190 n.a. 616 616 616 533^ 600 600 600 200 1969 - Jan. Feb. Mar. Apr. May June 2,143 2,292 2,022 2,083 2,031 2,144 1,988 2,109 1,826 1,877 1,810 1,873 691 708 636 525 531 439 131 DATE , ' FNMA-GNMA 4,648 2,914 2,496 2,323 1,797 2,508 Not Seasonally Adlusted ^ 1966 1967 1968 " July 1/ LIFE INSURANCE COMPANIES 4,705 4,639 6,677 2,760 3,118 2,796 3,761 7,538 9,330 160 879 203 957 219 901 248 718 204 1,026 . 233 988 . 230 1,216 215 870 Seasonally Adjusted 303 269 208 253 258 231 163 890 874 852 897 842 1,033 874 88 216 169 200 181 159 144 n.a. 104 258 130 202 179 170 * 246 235 220 152 191 185 222 . 293 155 183 196 206 221 271 324 Monthly data for commercial banks, including banks in the possessions,-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 1 9 6 8 , 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 series. Altogether, these groups accounted for 87 per cent of the net increase estimated for all holders in 1 9 6 7 . NET CHANGE IN MORTGAGE HOLDINGS (seasonally adjusted) Monthly Billions of dollars 3.0 TOTAL, INCL. FNMA - GNMA 2.0 FINANCIAL INSTITUTIONS 1966 1967 1968 1.5 1969 TABLE 13: Net Increases in Mnrtaaoe Debt Outstanding 1 Billions of dollars, SAAR 2 RESIDENTIAL 1- to. 4- MULTI- . FAMILY FAMILY COMMERCIAL QUARTER TOTAL 1965 - I II III IV 24.9 25.2 25.8 26.6 18.6 18.5 19.3 19.6 15.1 15.1 15.5 15.8 3.5 3.5 3.8 3.8 1966 - I II III IV 28.3 24.2 -18.4 15.6 19.0 15.6 10.8 '9.5 14.7 12.1 8.3 7.2 4.3 3.5 2.6 2.3 15.5 20.4 III , 2 6 . 3 IVp 28.6 9.9 13.7 19.1 20.9 6.8 10.5 15.3 16.5 3.0 3.3 3.8 4.4 1968 - I P IIP IIII ivp 26.9 25.8 25.8 31.3 18.2 17.9 17.7 21.5 15.4 14.8 14.1 17.0 1969 - I P IIP 30.2 27.1 21.1 19.3 18.0 16.1 1967 - I n Hp MULTI-AND COMMERCIAL FARM 8.0 8.1 8.4 7.9 2.2 2.1 2.2 2.4 6.9 6.5 5.4 4.3 11.6 10.0 8.3 6.2 2.4 2.2 2.1 1.7 3.8 4.8 4.8 5.1 7.3 8.1 8.8 8.8 1.8 1.9 2.4 2.6 2.8 3.1 3.5 4.5 6.2 5.7 6.4 '8.1 9.4 8.7 10.2 11.8 2.4 2.3 1.8 1.7 3.2 3.2 7.1 5.9 10.6 9.0 2.0 1.9 4.2 4.5 4.4 4.6 ' = 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 non-farm mortgage debt by type of property, where not available, and interpolations and extrapolations, where required, estimated by Federal Home Loan Bank Board and the Federal Reserve. Residential mortgage debt includes nonfarm only and is sum of 1-to 4-family and multifamily mortgage debt combined. NET INCREASES IN MORTGAGE DEBT OUTSTANDING Quarterly Billions of dollars, seasonally adjusted annual rate TOTAL 24 TOTAL RESIDENTIAL / 1-4 FAMILY COMMERCIAL MULTIFAMILY 1965 1967 1969 TABLE 14: FNMA Weekly "Auction'' Results/• WEEK ENDED July 7 14 22 28 IMPLICIT YIELD2 (per cent) COMMITMENTS IN $ MILLIONS ACCEPTED 1-YEARN 901-YEAR 1 9066TOTAL TOTAL & OVER M0NTH & OVER DAY MONTH DAY OFFERED 85.1 11.7 8.42 8.47 24.1 8.31 121.0 195.5 11.5 8,,39 8.40 8.29 17.4 100.9 129.7 177.1 18.3 8.31 93.5 8.,30 19.1 8.19 130.9 250.9 21.3 8.,26 92.4 8.,25 8.15 15.9 129.6 298.2 282.5 275.2 269.7 250.6 Sept.. 2 ' 252.5 242.7 8 152,i Aug. 4 11 18 25 19.1 16.7 14.7 13.5 78.9 82.7 88.3 112.1 27.4 29.9 26.3 25.2 8,.27 8,.28 8,,31 8..32 8,.28 8,.29 8,.31 8.,32 8.16 8.16 8.18 8.19 150.5 22.9 152.4 29.0 (145.0) 3/ 94.8 98.7 32.9 24.6 8.33 8.34 8.34 8.36 8.21 8.22 125.4 129.3 129.2 150.8 Note: Under the FNMA suction 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 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 are gross, before deduction of 50 basis points fee paid by investors to servicers. 3 FNMA announced limit of accepted bids for next week's auctidn. FN MA WEEKLY "AUCTION" RESULTS 120 AMOUNT OF ACCEPTED BIDS BY COMMITMENT PERIOD 100 1 YEAR AND OVER 40 6 MONTHS / 3 MONTHS Per cent 8.6 "IMPLICIT YIELD 6-MONTH COMMITMENTS 8.0 Millions 400 300 200 TOTAL BIDS RECEIVED TOTAL BIDS ACCEPTED JUNE AUG. OCT. 1968 DEC. FEB. APR. JUNE 1969 AUG. OCT. DEC. TABLE 15: Private Housing Starts and Permits STARTS DATE 1968 - July Aug. SEASONALLY ADJUSTED ANNUAL RATE TOTAL 1-FAMILY 2 OR MORE 1,531 1,518 TOTAL UNADJUSTED TYPE OF FINANCING FHA VA OTHER BUILDING PERMITS (SEASONALLY ADJUSTED ANNUAL RATE) 2 904 867 944 965 905 922 627 651 648 605 828 585 139.8 136.6 134.3 140.8 127.1 96.4 18.8 20.9 18.6 21.4 17.5 16.3 4.9 4.8 4.6 5.3 4.2 4.4 116.2 110.9 111.1 114.0 105.4 75.7 1,289 1,290 1,393 1,378 1,425 1,463 1,878 1,066 1,686 975 1,584 828 Mar. 1,563 Apr. 797 883 May 1,509 801 June £ a , 464 739 July 2 a , 3 3 6 812 711 756 766 626 663 597 101.5 90.0 131.9 159.0 155.5 146.4 122.0 14.2 13.2 18.9 23.0 21.1 21.5 21.4 3.8 3.5 3.9 4.'4_ 4.3 4.6 4.7 83.5 73.3 109.1 131.6 130.1 120.3 95.9 1,403 1,477 1,421 1,502 1,323 1,340 1,206 Sept. 1 , 5 9 2 Oct. 1,570 Nov. 1,733 Dec. 1,509 1969 - Jan. Feb. Total starts are Census estimates including farm for both permit-issuing and ' nou-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. 2 Building permits before January 1963 are Census estimates for about 1 0 , 0 0 0 areas identified as having a local building permit system in 1 9 5 9 . Estimates beginning January 1963 are for approximately 1 2 * 0 0 0 and beginning January 1967 1 3 , 0 0 0 , 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. 1 PRIVATE HOUSING STARTS AND PERMITS M o n t h l y .annual rates Millions of u n i t s ] SEASONALLY ADJUSTED 2.0 HOUSING STARTS 1.6 1.2 BUILDING PERMITS (in issuing areas) CHANGE IN SERIES PER CENT OF UNADJUSTED TOTAL STARTS MULTI-FAMILY GOVERNMENT UNDERWRITTEN 1963 1965 1967 1969 TABLE 16: Mortgage and Bond Yields X DATE , 1957 - High ,1958 - Low 1959-60 - High 1961-66 - Low 1966 - High 1967 - High Low 1968 - High Low 1968 - Dec. 1969 - Jan. Feb. Mar. Apr. May June July 1 2 3 4 11 FHA MORTGAGES 2 . NEW SPREAD BECONVENTIONAL TWEEN YIELDS Aaa COR1 ON CONV. & MORTPORATE 25-YEAR 30-YEAR GAGES FHA MORTBONDS 3 4 GAGES I 5.63 n.a. 6.00 .47 4.94 5.35 n.a. 5.55 .15 3.65 6.26 n.a. 6.30 .23 5.25. 5.43 5.44 5.80 .25 4.41 6.73 6.81 6.70 .30 5.82 n.a. 6.81 6.65 6.51 .11 n.a. 6.29 6.40 -.12 5.18 n. a. 7.52 7.30 6.79 .02 n.a. 6.78 6.75 -.27 6.15 n.a. n.a. n.a. n.a. n.a. n.a. n.a. 7.50 7.99 8.05 8.06 8.06 8.35 8.36 7.40 7.55 7.60 ' 7.65 7.75 7.75 8.00 8.10 -.10 -- -.39 -.40 -.31 -.31 -.35 -.26 6.79 6.92 - 6.91 7.37 7.17 7.22 7.58 7.63 SPREAD BETWEEN YIELDS ON NEW CORPORATE BONDS AND FHA MORTGAGES 1.58 ..88 1.69 .77 1.16 1.28 .27 1.20 .26 .71 1.08 .68 .89 .84 .77 .73 Neither mortgage nor bond yields include allowance for servicing costs which arc 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-fieId-office opinions about average bid prices in the private secondary market for new-home mortgages for immediate delivery. Separate data available for 25-year and--beginning July 1961--30-year mortgages with minimum downpayments, weighted by probable volume of transactions. Yields computed by FHA, assuming prepayment period of 12 years for 25-year mortgages and 15 years for 30-year mortgages. Over the period for which they can be compared,, the movement of the two mortgage yield series has been similar. Dashed lines indicate periods of adjustment to changes in contractual interest rates. Based on FHA-field-office opinion on typical interest rates (rounded) on' conventional first mortgages prevailing in the market areas of insuring office cities. Beginning with April 1960, rate relates only to new-home mortgages; prior to that date, rate related to both new as well as existing-home, mortgages. Dashed line indicates this change in the series. See note for Table 1. MORTGAGE AND BOND YIELDS Monthly . Per cent HOME MORTGAGES: CONVENTIONAL Aaa CORPORATE BONDS: i NEW ISSUES / W Y I E L D S P R E A D (FHA MORTGAGE VS. NEW ISSUE Aaa CORPORATE BONDS) . Basis points 200 100 1962 1964 1966 1968 1970 TABLE 17: Conventional Mortgage Terms NEW HOMES CON- FEES & TRACT CHARGES EFFEC- MATURITY DATE . / / RATE (PER CENT) (PER CENT) LOAN/ PRICE RATIO (PER CENT) LOAN AMT. 1 EXISTING HOMES CON- FEES & LOAN/ TRACT CHARGES EFFEC- MATU- PRICE (PER RATE TIVE RITY RATIO LOAN AMT. ($000) (YEARS) 2 TIVE RATE 3 0.85 0.87 0.37 0.88 0.84 0.89 7.17 7.24 7.24 7.23 7.21 7.23 25.5 25.5 25.5 25.6 25.4 25.9 73.7 73.6 74.2 74.5 74.1 74.0 22.2 22.6 22.1 22.7 22.5 24.7 7.10 7.12 7.11 7.09 7.07 7.09 0.83 0.85 0.82 0.84 0.82 0.85 7.23 7.26 7.25 7.22 7.21 7.23 22.5 22.7 22.6 22.5 22.7 23.3 72.6 73.0 72.6 72.4 72.9 73.2 18.5 18.6 18.3 18.3 18.9 20.4 0.84 0.81 0.93 0.96 0.88 0.84 0.91 7.30 7.39 7.47 7.62 7.65 7.76 7.90 25.6 25.6 25.8 25.4 25.8 25.6 25.5 73.6 73.3 73.8 72.6 73.2 73.0 71.9 24.1 23.5 24.0 24.8 25.0 24.9 24.5 7.18 7.28 7.35 7.46 7.54 7.64 7.79 0.86 0.86 0.84 0.85 0.83 0.86 0.91 7.32 7.42 7.49 7.60 7.6b 7.79 7.95 22.8 22.9 23.0 23.0 22.7 22.8 22.9 72.6 72.8 72.7 71.8 71.9 71.4 71.7 20.0 19.6 20.2 19.9 19.7 20.1 20.2 ($000) (PER CENT) CENT) RATE 2 3 (YEARS) (PER CENT) ^1968 July Aug. Sept. Oct. Nov. Dec. 7.04 7.10 7.10 7.09 7,07 7.09 1969 7.16. Jan. Feb. 7.26 Mar. 7.32 Apr. !7.47 May 7.50 June . 7.62 July & '7.75 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 includ.ed-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. CONVENTIONAL MORTGAGE TERMS Monthly Years 30 MATURITY NEW EXISTING 20 80 LOAN/PRICE RATIO NEW EXISTING 1963 1965 1969 * CHANGE IN SERIES
@FedFRASER