Greenbook/Tealbook

Prefatory Note The attached document represents the most complete and accurate version available based on original copies culled from the files of the FOMC Secretariat at the Board of Governors of the Federal Reserve System. This electronic document was created through a comprehensive digitization process which included identifying the bestpreserved paper copies, scanning those copies, 1 and then making the scanned versions text-searchable. 2 Though a stringent quality assurance process was employed, some imperfections may remain. Please note that some material may have been redacted from this document if that material was received on a confidential basis. Redacted material is indicated by occasional gaps in the text or by gray boxes around non-text content. All redacted passages are exempt from disclosure under applicable provisions of the Freedom of Information Act. 1 In some cases, original copies needed to be photocopied before being scanned into electronic format. All scanned images were deskewed (to remove the effects of printer- and scanner-introduced tilting) and lightly cleaned (to remove dark spots caused by staple holes, hole punches, and other blemishes caused after initial printing). 2 A two-step process was used. An advanced optical character recognition computer program (OCR) first created electronic text from the document image. Where the OCR results were inconclusive, staff checked and corrected the text as necessary. Please note that the numbers and text in charts and tables were not reliably recognized by the OCR process and were not checked or corrected by staff. Content last modified 6/05/2009. CONFIDENTIAL (FR) SUPPLEMENT CURRENT ECONOMIC AND FINANCIAL CONDITIONS Prepared for the Federal Open Market Committee By the Staff Board of Governors of the Federal Reserve System February 3, 1967 SUPPLEMENTAL NOTES The Domestic Financial Situation Reflecting the trend toward slightly easier mortgage markets, FNMA raised its secondary-market buying prices on FHA and VA loans, effective February 3. FNMA's price increase -- reducing the yield on mortgages eligible for purchase by some 12 basis points -was the first in over 2-1/2 years. As a further market stimulant, FNMA also removed two former restrictions on its purchasing requirements. Mortgage sellers will no longer be required to submit loans for FNMA purchase within four months after FHA or VA underwriting, and the FNMA ceilings of $20,000 on existing-house loans and $25,000 on new-house loans eligible for purchase will no longer be in effect. A further stimulant to the industry was provided by the Home Loan Bank Board on February 3 when regulations on repayment of advances to meet withdrawals and restrictions on maximum loan commitments outstanding were relaxed. The loosening of these restrictions, imposed since last May, will mean that S&L's can increase their outstanding loan commitments from four times their loan repayments plus the last four months net increase in savings capital, to levels "consistent with local market conditions". Also, associations whic khhad- previously received advances to meet withdrawals and were repaying this debt on a monthly basis out of new savings, can now convert these advances to the expansion category, and thus will not have to repay But the Home Loan Bank Board also emphasized that assothe ciations with poor scheduled items ratios or those approaching/regulatory immediately. maximum on lines of credit will continue to be discouraged from incurring further Bank indebtedness. The Treasury's $7.5 billion cash refunding drew over $42 billion of subscriptions for the new 15-month and 5-year notes. Allot- ments were set at 10 per cent of subscriptions for the shorter-term issue with subscriptions up to $100,000 awarded in full. On the 5-year note, the allotment was an unusually low 7 per cent and subscriptions up to $50,000 were allotted in full. International Developments The Swedish central bank (Sveriges Riksbank) has reduced its discount rate from 6 per cent to 5-1/2 per cent effective February 3. Corrections: Page 111-18. as follows: Third sentence, first paragraph, should begin "Commercial banks, which had stayed fairly near their unusually high year-earlier levels of net takings in the second and third quarters, and life insurance companies . . ." The heading of the table on page IV-6 should be "Short-term Rates," and after each rate except Federal Funds "3-month" should be inserted. Insert after Federal Funds: Euro-dollar call money: 4-7/8 per cent at end January 1966, 6-1/4 per cent in middle of September 1966, 5-1/8 per cent near end of January 1967. 

Federal Reserve (1967, February 6). Greenbook/Tealbook. Greenbooks, Federal Reserve. https://whenthefedspeaks.com/doc/greenbook_19670207_part3

@misc{wtfs_greenbook_19670207_part3,
  author = {Federal Reserve},
  title = {Greenbook/Tealbook},
  year = {1967},
  month = {Feb},
  howpublished = {Greenbooks, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/greenbook_19670207_part3},
  note = {Retrieved via When the Fed Speaks corpus}
}