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OUR ECONOMIC CONTROLS AND POLICIES
Speech by D a r r y l R. F r a n c i s , P r e s i d e n t ,
F e d e r a l R e s e r v e Bank of St. Louis,
At "Kingdom of Callaway" Supper,
Fulton, Missouri
J a n u a r y 23, 1968

It is good to have this opportunity of d i s c u s s i n g s o m e of the
n a t i o n ' s economic p r o b l e m s at this m e e t i n g in m e m o r y of the
"Kingdom of Callaway,"

I a m honored to be included among those

outstanding s p e a k e r s who have h e r e t o f o r e a d d r e s s e d this g r o u p .

Like

the m i l i t a groups that gathered h e r e during the e a r l y Civil War d a y s ,
we a r e s t i l l vitally i n t e r e s t e d in public p o l i c i e s ,

I shall, however,

limit my r e m a r k s to those policies that have an i m p a c t p r i m a r i l y on
economic activity.
In o r d e r to provide an a p p r o p r i a t e setting for public policies
r e l a t i v e to economic activity, I shall review the c o u r s e of our economy
since the c u r r e n t upswing began in e a r l y 1961. In this review I have
divided the seven y e a r s u n d e r d i s c u s s i o n into four s u b - p e r i o d s , 1961
through 1964, late 1964 to e a r l y 1966, e a r l y 1966 to late 1966, and late
1966 to date.




During the f i r s t period, 1961 through 1964, steady economic
expansion o c c u r r e d .

As a r e s u l t , unemployment was reduced from

about 7 p e r cent of the labor force in e a r l y 1961 to l e s s than 5 p e r
cent in late 1964.

I n d u s t r i a l plant utilization r o s e from 75 p e r cent

to 86 p e r cent of capacity.

These gains w e r e a c c o m p l i s h e d in an

o r d e r l y fashion without g r e a t f r i c t i o n s , s h o r t a g e s , or i m b a l a n c e s ,
and the t r e n d of p r i c e s did not deviate substantially from a 1. 5 p e r
cent upward trend r a t e .
Major tools of economic stabilization w e r e m o d e r a t e l y
s t i m u l a t i v e in this period of balanced economic expansion.

Growth

in the money stock of the nation was at a 2. 7 p e r cent annual r a t e
c o m p a r e d with an a v e r a g e 2 p e r cent r a t e in the p r e v i o u s decade.
The influence of fiscal actions (government expenditures and taxes)
on the economy b e c a m e m o r e expansive.
During the second period, from late 1964 to e a r l y 1966, the
p a c e of economic expansion quickened.

This period was m a r k e d by

the a c c e l e r a t i o n of m i l i t a r y p u r c h a s e s for V i e t n a m .

Total spending

on goods and s e r v i c e s r o s e at a 10 p e r cent annual r a t e .

Most of the

i n c r e a s e in spending was matched by a 7. 7 p e r cent r a t e of gain in




- 3 r e a l output.

The rapid expansion in output further reduced

unemployment from about 5 p e r cent to l e s s than 4 p e r cent of the
labor force and i n c r e a s e d i n d u s t r i a l plant utilization from 86 p e r
cent to over 90 p e r cent of capacity.

P r i c e s r o s e at the somewhat

f a s t e r 2 p e r cent annual rate from late 1964 to e a r l y 1966, but
c o n s i d e r i n g the r i s e in t o t a l demand, the r a t e of inflation was l e s s
than might have been expected.
F i s c a l and m o n e t a r y actions w e r e v e r y e x p a n s i o n a r y
this p e r i o d .

The F e d e r a l budget b e c a m e m o r e s t i m u l a t i v e .

during
It moved

1/
from a s u r p l u s of $6 billion in 1964 to a n e a r balance in e a r l y 1966.
The m o n e t a r y a u t h o r i t i e s provided r e s e r v e s to m e m b e r banks in
o r d e r to avoid a s h a r p tightening in c r e d i t conditions in r e s p o n s e to
the s t r o n g c r e d i t d e m a n d s .

The r e s e r v e s provided for a rapid

expansion in c o m m e r c i a l bank c r e d i t .
growth of money to a c c e l e r a t e .

T h i s , in t u r n , caused the

The r a t e of gain in the stock of money

r o s e from the 2. 7 p e r cent r a t e in the e a r l i e r period to a 4 p e r cent
r a t e from mid-1964 to the s p r i n g of 1965, and further to a 6 p e r cent
r a t e from the s p r i n g of 1965 to the spring of 1966.

This a c c e l e r a t i o n

in m o n e t a r y growth was v e r y e x p a n s i v e .
In the third p e r i o d , from e a r l y 1966 to late 1966, the r a t e
of growth in total spending slowed somewhat.

However, r e l a t i v e to

the ability of the economy to produce as it approached capacity, total
1/ Data apply to the h i g h - e m p l o y m e n t budget.



- 4 demand r e m a i n e d e x c e s s i v e .

The upward climb in o v e r - a l l p r i c e s

r o s e from the 2 p e r cent r a t e in the p r e v i o u s period to a 3 p e r cent
r a t e in this p e r i o d .
Monetary r e s t r a i n t was an i m p o r t a n t factor in the s l o w e r
growth in spending in late 1966.

F r o m April 1966 to J a n u a r y 1967,

t h e r e was little change in the money supply -—a v e r y r e s t r i c t i v e
m o n e t a r y action c o m p a r e d with the 6 p e r cent i n c r e a s e in money in
the previous 12 m o n t h s .
By the fall of 1966 a r e s t r a i n t on spending was n o t i c e a b l e .
Some spending units began to reduce outlays to c o n s e r v e c a s h and
r e v i s e d t h e i r expectations downward.

Credit d e m a n d s t a p e r e d off.

I n t e r e s t r a t e s , after reaching a peak in the e a r l y fall, declined
until e a r l y 1967.
monetary

Lower r a t e s gave an i m p r e s s i o n of an e a s i e r

situation despite continued slow growth in the money stock.

F i n a l p u r c h a s e s by the p r i v a t e s e c t o r (gross national product l e s s
F e d e r a l Government outlays and net p u r c h a s e s of i n v e n t o r i e s ) slowed
to a 4. 4 p e r cent r a t e from the first to third q u a r t e r s of 1966 and
further to a 2. 6 p e r cent growth r a t e in the final q u a r t e r of 1966.

In

c o m p a r i s o n , such p u r c h a s e s grew at about a 10 p e r cent r a t e from
late 1964 to e a r l y 1966.
The m a r k e d slowing in the growth of final spending by c o n s u m e r s
and b u s i n e s s e s during 1966 was partially offset by a c c e l e r a t i o n s in




- 5 G o v e r n m e n t spending and by s o m e , a p p a r e n t l y u n d e s i r e d ,

increases

in b u s i n e s s i n v e n t o r i e s .
Despite the pause in economic growth in late 1966, inflationary
p r e s s u r e s remained strong.

O v e r - a l l p r i c e s i n c r e a s e d at a 2. 3 p e r

cent annual r a t e in the first half of 1967, following the 3 p e r cent rate
of i n c r e a s e in the p r e v i o u s t h r e e q u a r t e r s .

Much of the slowing in

p r i c e i n c r e a s e s reflected a changed supply situation in a g r i c u l t u r a l
p r o d u c t s , bringing about a decline in quotations for f a r m p r o d u c t s ,
p r o c e s s e d foods, and feeds.
In the fourth period, late 1966 to date, activity first declined
somewhat and then a c c e l e r a t e d s h a r p l y .

Of the two m a j o r tools of

the Government for influencing the pace of economic activity, one was
a s t i m u l a t i v e force and the other was a r e s t r a i n i n g force in e a r l y 1967.
F i s c a l actions provided a strong upward t h r u s t to spending; in fact,
spending by Government ( F e d e r a l , state and local) accounted for the
e n t i r e i n c r e a s e in total spending in the first half of 1967.
through the " m u l t i p l i e r ,

n

These outlays,

probably had a stimulative effect on c o n s u m e r

and b u s i n e s s e x p e n d i t u r e s .

The lack of growth in money from the

s p r i n g of 1966 to e a r l y 1967 had a dampening effect on p r i v a t e spending.
Sometime during the late s p r i n g of 1967 another m a r k e d and
sustained change o c c u r r e d in the pace of economic activity.

Total

spending r o s e at an e s t i m a t e d 9 p e r cent annual r a t e in the last: half
of 1967 after going up at a 3.4 p e r cent pace in the first half.




Real

- 6 output of goods and s e r v i c e s , which had changed little on b a l a n c e
e a r l y in the y e a r , expanded at an e s t i m a t e d 5 p e r cent annual r a t e
in the l a s t half despite s e v e r a l m a j o r s t r i k e s .
This change from economic pause to rapid growth can be
a t t r i b u t e d to both fiscal and m o n e t a r y developments,,
v e r y s t i m u l a t i v e in the s u m m e r and fall of 1967.
change, however, was in m o n e t a r y f a c t o r s .

E a c h was

The s h a r p e s t

The money supply r o s e

at the r a t e of 7 p e r cent after having r e m a i n e d unchanged during
the p r e v i o u s p e r i o d .

F i s c a l a c t i o n s , which w e r e a l r e a d y the m o s t

s t i m u l a t i v e since World War II, may have b e c o m e slightly m o r e
expansive.
S u m m a r i z i n g developments since 1961, the combination
of fiscal and m o n e t a r y policies provided balanced and steady
economic

expansion until the end of 1964.

In late 1964 t h e s e policies

b e c a m e m o r e expansive, and by e a r l y 1966 demand for goods and
s e r v i c e s b e c a m e e x c e s s i v e , and noticeable p r i c e i n c r e a s e s o c c u r r e d .
Monetary r e s t r a i n t beginning in e a r l y 1966 began to slow expansion
late in the y e a r , and by e a r l y 1967 activity was showing virtually no
growth.

Despite the p a u s e , h o w e v e r , inflationary p r e s s u r e s r e m a i n e d

s t r o n g in the first half of 1967.

By late s p r i n g , economic activity

had turned up again as a r e s u l t of s t i m u l a t i v e fiscal and m o n e t a r y
policies.

The upswing continued through the y e a r with s u b s t a n t i a l

p r i c e inflation during the l a s t t h r e e q u a r t e r s .




.. 7 As a r e s u l t of this e x c e s s i v e demand and p r i c e inflation,
the F e d e r a l R e s e r v e S y s t e m has taken two steps which g e n e r a l l y
point to l e s s expansive m o n e t a r y conditions.

Last N o v e m b e r the

S y s t e m r a i s e d the discount r a t e from 4 to 4 - 1 / 2 p e r cent on
eligible p a p e r of m e m b e r b a n k s .

More r e c e n t l y r e s e r v e r e q u i r e -

m e n t s of the l a r g e r m e m b e r banks w e r e i n c r e a s e d .
B e c a u s e of t h e s e m o v e s and the upward trend of i n t e r e s t
r a t e s in r e c e n t y e a r s , grea,t c o n c e r n as to the probable c o u r s e of
i n t e r e s t r a t e s has developed.

I shall c o m m e n t on this topic by

a d d r e s s i n g myself to the question of what would likely happen if
l e s s expansive fiscal and m o n e t a r y policies a r e

adopted.

In a n s w e r ,

I suggest that total demand for goods and s e r v i c e s would decline
f r o m the c u r r e n t e x c e s s i v e levels after a brief t i m e lag.

This .would

r e d u c e p r e s s u r e on the c a p i t a l m a r k e t s and tend to lower i n t e r e s t
rates.

But a m o r e

immediate

i m p a c t on r a t e s would probably occur

as a r e s u l t of reduced g o v e r n m e n t b o r r o w i n g and m o r e stable p r i c e
expectations.
G o v e r n m e n t deficits n e c e s s i t a t e b o r r o w i n g , and such demands
for savings have the s a m e upward p r e s s u r e on i n t e r e s t r a t e s as a
s i m i l a r amount of b o r r o w i n g in the p r i v a t e s e c t o r .

Less Government

spending or higher taxes would reduce the deficits, t h e r e b y reducing
needs for c r e d i t and the accompanying upward p r e s s u r e on i n t e r e s t
rates.




- 8 G o v e r n m e n t deficits can be financed in two w a y s :
t h r o u g h money c r e a t i o n ( n o n - i n t e r e s t b e a r i n g g o v e r n m e n t debt)
o r through s a l e s of s e c u r i t i e s ( i n t e r e s t b e a r i n g g o v e r n m e n t debt),
As a continuous and p e r m a n e n t p r o g r a m , I can see s u b s t a n t i a l
flows in e i t h e r method of financing g o v e r n m e n t e x p e n d i t u r e s .
Although I a m r e l u c t a n t to c o m p a r e g o v e r n m e n t financing to that
of the individual f i r m or household, over the longer pull, it
a p p e a r s to m e that each m u s t be brought into balance with income.
Another s i m i l a r i t y is thai in both c a s e s d e c i s i o n s m u s t eventually
be made as to what we can afford, given the level of r e s o u r c e s
that the people a r e willing to allocate to public u s e .

This p r o b l e m

has a fairly s i m p l e solution in the case of m o s t individuals and f i r m s .
R e s t r a i n i n g influences come to b e a r r a t h e r quickly when e x c e s s i v e
debts a r e c r e a t e d by households.
m o r e subtle,

The r e s t r a i n i n g influences a r e

however, in the c a s e of g o v e r n m e n t s .

a r e still marketable.

Money is still a c c e p t a b l e .

Their securities

The p r o b l e m is

that i n t e r e s t r a t e s a r e higher than they would otherwise be and that
the dollar has l e s s p u r c h a s i n g power.

We thus pay for e x c e s s i v e

g o v e r n m e n t e x p e n d i t u r e s through reduced p u r c h a s i n g power of the
c u r r e n c y and through a reduction in value of all dollar denominated
s e c u r i t i e s and debt.




. 9 -

It a p p e a r s to m e that this nation should take a c l o s e r
look at its income and r e s o u r c e s and come to s o m e decision as
to what it can afford to spend in the public s e c t o r , given the selfi m p o s e d tax l i m i t a t i o n s of its c i t i z e n s .

Like the individual

household, it should then limit its expenditures to its i n c o m e ,
given p e r h a p s some leeway for deficits during p e r i o d s of s e r i o u s
r e c e s s i o n s and s u r p l u s e s as such r e c e s s i o n s r e c e d e .
The effect of r i s i n g p r i c e s on i n t e r e s t r a t e s is often
overlooked.

N e v e r t h e l e s s , it is quite r e a l .

Savers must protect

the p u r c h a s i n g power of funds lent, and b o r r o w e r s a r e willing to
pay h i g h e r r a t e s if they expect to repay in c h e a p e r d o l l a r s .

For

e x a m p l e , if savings through the i n v e s t m e n t route yield a r e a l r a t e
of r e t u r n of 4 p e r cent and p r i c e s a r e r i s i n g 3 p e r cent p e r y e a r ,
s a v e r s would r e q u i r e a stated r a t e of 7 p e r cent to r e a l i z e the 4
p e r cent r e a l r e t u r n on t h e i r s a v i n g s .

In this c a s e , if s a v e r s have

an opportunity to invest in capital goods w h e r e r e a l r a t e s of 4 p e r
cent a r e s t i l l obtainable, savings institutions m u s t pay a c o m p a r a b l e
r a t e to obtain loanable funds.

B o r r o w e r s a r e as willing to pay the

7 p e r cent when they expect p r i c e s to r i s e at a 3 p e r cent r a t e as
they a r e to pay 4 p e r cent u n d e r stable p r i c e e x p e c t a t i o n s .

It is

this upward p r e s s u r e on n o m i n a l r a t e s n e c e s s a r y for a constant r e a l
r a t e of r e t u r n that has pushed the nominal r a t e s up to such high levels
during the p a s t two y e a r s .




- 10 What will happen with a l e s s expansive m o n e t a r y policy?
In a n s w e r , I s h a l l c o m m e n t again on 1966 developments when t h e s e
policies p r e v a i l e d .

You will r e c a l l that i n t e r e s t r a t e s r o s e for about

3 or 4 months after the stock of money stopped growing.

Demand

for goods and s e r v i c e s , however, soon began to m o d e r a t e and a
reduction in r a t e s followed.

The m o r e r e s t r i c t i v e actions o c c u r r e d

in the second q u a r t e r of 1966, and by late S e p t e m b e r i n t e r e s t r a t e s
began to decline.
F r o m t h e s e c o m m e n t s you can conclude that I a m not
i m p r e s s e d with fears of h i g h e r r a t e s or a money c r i s i s r e s u l t i n g
f r o m l e s s expansive m o n e t a r y o p e r a t i o n s .

To the c o n t r a r y , I

suggest that the expansive m o n e t a r y and fiscal policies of r e c e n t
y e a r s have been the i m p o r t a n t factors that pushed i n t e r e s t r a t e s up.
A somewhat l e s s expansive m o n e t a r y policy than prevailed through
m o s t of 1967 would likely r e s u l t in l e s s demand for goods and
s e r v i c e s , m o r e stable p r i c e s and, after a s h o r t t i m e , lower i n t e r e s t
rates.
While on this topic of i n t e r e s t r a t e s , I would also like to
point out that m o s t of the s o - c a l l e d "money c r i s i s 1 1 o r " c r e d i t c r u n c h "
in 1966 reflected legal i m p e d i m e n t s to p r o p e r m a r k e t functions.

Many

s t a t e s have e x c e s s i v e l y r e s t r i c t i v e laws with r e s p e c t to i n t e r e s t r a t e s .
Such laws which limit r a t e s paid and c h a r g e d by savings i n s t i t u t i o n s ,
i . e . , c o m m e r c i a l b a n k s , savings and loan a s s o c i a t i o n s , e t c . , may do
g r e a t damage to local c o m m u n i t i e s ,



- 11 When the supply and demand situation with r e s p e c t to loanable funds calls for high i n t e r e s t r a t e s , savings institutions m u s t
both pay and c h a r g e the higher r a t e s or savings will find other outlets
w h e r e the r e a l r a t e of r e t u r n is g r e a t e r .

Savings f i r m s operating in

such a r e a s thus fail to grow at the s a m e rate as such f i r m s in f r e e r
market areas.

These slower growing firms thus do not get the funds

to lend and c r e d i t b e c o m e s unavailable to t h e i r c u s t o m e r s .

It thus

a p p e a r s to m e that m o s t state r e s t r i c t i o n s on r a t e s b e a r h e a v i e s t on
those institutions and b o r r o w e r s whom the r e s t r i c t i o n s are
to h e l p .

designed

C o n v e r s e l y , they aid the F e d e r a l Government, l a r g e

b u s i n e s s e s , and others that can successfully tap the central moneyarid capital m a r k e t s w h e r e r a t e s a r e free to move with b a s i c supply
and demand conditions.

The young b o r r o w e r s , the i n n o v a t o r s , and

the fast-growing f i r m s that would be willing to pay s o m e p r e m i u m
for r i s k - a r e excluded from c r e d i t m a r k e t s in t h e s e c o m m u n i t i e s .
The Dollar and Gold
In connection with m o n e t a r y p r o b l e m s , apparently one of
the m o r e m i s u n d e r s t o o d r e l a t i o n s h i p s is that between the dollar
and gold.

Some people believe that the size of the gold stock held

by the U. S, d e t e r m i n e s the value of the d o l l a r .

F o r all p r a c t i c a l

p u r p o s e s , gold has been detached from d o m e s t i c money since 1933.
It is still used for settling i n t e r n a t i o n a l t r a n s a c t i o n s , and as long as




- 12 such t r a n s a c t i o n s a r e settled in this m a n n e r , a stock of gold is
desirable.

On the other hand, in our domestic economy, gold is

only used for c o m m e r c i a l and i n d u s t r i a l p u r p o s e s .
gold is set by law at $35 p e r ounce.

The p r i c e of

This only m e a n s that the U. S.

Government stands willing to pay $35 p e r ounce for gold ?vnd will
s e l l gold to foreign g o v e r n m e n t s and g o v e r n m e n t a l a g e n c i e s at this
price.

The fact that the gold p r i c e is set at $35 p e r ounce does not

m e a n that gold d e t e r m i n e s the value of the dollar*

On the c o n t r a r y ,

the value of the dollar has for s e v e r a l decades d e t e r m i n e d the p r i c e
of gold.

F u r t h e r m o r e , the productive efficiency of our d o m e s t i c

economy, coupled with fiscal policies and the stock of money,
d e t e r m i n e s the value of the d o l l a r .

A rapid i n c r e a s e in the n u m b e r

of d o l l a r s c a u s e s p r i c e s to i n c r e a s e and the value of the d o l l a r to
depreciate.

C o n v e r s e l y , a d e c r e a s e in n u m b e r of d o l l a r s c a u s e s

t h e i r value to a p p r e c i a t e .

Thus, if we can find s o m e m e a n s of

settling i n t e r n a t i o n a l p a y m e n t s without the use of gold, we can drop
gold from our m o n e t a r y s y s t e m completely without any i m p a c t on
our d o m e s t i c economy and without any gain or d e p r e c i a t i o n in the
.value of money.

Gold supplies can then be used for tooth filling,

watch c a s e s , and other o r n a m e n t s , r a t h e r than being held u n d e r
guard by g o v e r n m e n t s at g r e a t expense.

W might view our d o l l a r e

gold r e l a t i o n s h i p in the s a m e m a n n e r as our p r i c e support p r o g r a m s
for f a r m p r o d u c t s .




F o r example, if the p r i c e is set too high, we

- 13 accumulate a stock of gold.

On the other hand, if the p r i c e is

s e t too low, our gold stock is depleted.
since we a r e losing gold a b r o a d .

That is the c a s e today,

I£ we r e m o v e d d o l l a r - g o l d p r i c e

r e l a t i o n s h i p s completely, however, we do not know what would
happen to the p r i c e of gold.

It might decline.

Another group views the c u r r e n t d o l l a r - g o l d r e l a t i o n s h i p
as being beneficial b e c a u s e of the c o n s t r a i n t it p l a c e s on d o m e s t i c
money c r e a t i o n .

F o r e x a m p l e , the legal r e q u i r e m e n t of 25 p e r

cent gold backing for all F e d e r a l R e s e r v e notes outstanding
u l t i m a t e l y places a limit on the volume of money c r e a t i o n .

In the

p e r i o d s , however, that such r e s t r i c t i o n s have b e e n effective, they
have proven h a r m f u l to the economy.

Such r e s t r i c t i o n s a r e m o r e

likely to cause destabilizing m o n e t a r y policies than policies which
contribute to m a x i m u m stability and growth.

T h u s , in r e c e n t decades

when m o n e t a r y expansion has approached the legal l i m i t s as m e a s u r e d
by the gold stock, the limits have been changed so as to p e r m i t an
o r d e r l y i n c r e a s e in the stock of money.
Since we a r e not willing to submit to the d r a s t i c r e s t r i c t i o n s
•imposed on m o n e t a r y policy by rigid gold t i e s , I see little r e a s o n for
maintaining any d o m e s t i c ties w h a t s o e v e r with gold.

In fact, as

indicated e a r l i e r , such ties have not r e a l l y existed since the e a r l y
1930 ! s.




Federal B u d g e t I n f l u e n c e *
S t i m u l u s or R e s t r a i n t
Q u a r t e r l y Totals a t A n n u a l Rates
Seasonally Adjusted

B i l l i o n s of D o l l a r s
20

CO

IDJ

Billions

of D o l l a r s
20

i—J

7

1\^>

<
C£

rHfcO

CO
LLJ
OCX

i- 1

\y\
-14.5

1959

1960

1961

1962

1963

1964

1965

1966

1967

Source:
F e d e r a l Reserve Bank of St. Louis
*The High-Employment Budget, first p u b l i s h e d by the Council of Economic Advisers.
Latest d a t a plotted: 4ih quarter estimated




Prepared by Federal Reserve Bank of St. Louis




~i {T>, '

Money Stock
Ratio Scale
Billions of Dollars

Ratio Scale

M o n t h l y A v e r a g e s of D a i i y Figures
Seasonally Adjusted

( Uune'64; ;Apr.'65;

Apr.'66 ! ! Jan.'671

;

Dec.'67:

ftJ*

1 O.

0A1

> yo z

? y r^,%

1964.

1965

1966

1 y6
o

30
/

Percentages are annua! rates of change between periods indicated. They are presented to a i d in'
comparing most recentdevelopments with pasf'trends."'
Latest c a ' a p ! o v t e d : D e c e r r . b e r p r e l i m i n a r y
Prepared by Federal Reserve Bank of St. Louis

Ratio Scale
Billions of Dollars

Ratio Scale
Billions of Dollars

Q u a r t e r l y T o t a I s at A n n u a l Rates
Seasonally Adjusted

+8.6%

807>6

450

•JU

1959

1960

1961

1962

1963

1964

1965

1966

1967

LLGNP in current d o l l a r s .
'
'
Source: U.S. D e p a r t m e n t of C o m m e r c e
[2_GNP in 1958 d o l l a r s .
Percentages are annual ratesof change between p e n o d s i n d i c a t e d . T h e y are presented to a i d in
comparing most recentdevelopments with p a s f ' t r e n d s "
Latest d a t a p l o t t e d : 4th q u a r t e r p r e l i m i n a r y




Prepared by Federal Reserve Bank of St. Louis

Prices
Ration Scale

Ratio Scale
1957-59=100
"120"

'1957-59=100
T20

1959

1960

1961

1962

1963

1964 1965

1966 1967

Source-. U.S. D e p a r t m e n t of Labor
Percentages are annual rates of change betv/een periods i n d i c a t e d . They are presented to aid in
comparing most recenrdeveloprnents v/ith past "trends."
 d a t a p l o t t e d :
Latest


November preliminary
Prepared by Federal Reserve Bank of St. Louis