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 March 15, By the Staff Board of Governors of the Federal Reserve System 1974 SUPPLEMENTAL NOTES The Domestic Economy Autos. Sales of new domestic-type autos in the first 10 days of March were at a 7.0 million unit annual rate, a third below the level of the same period a year ago and 6 percent below the month of February as a whole. The decline from last month was due in part to the termination of some sales incentive contests in February. Inventories. Book value of retail trade inventories rose at a $1.7 billion annual rate in January (p), following the sharply upwardrevised $7.5 billion December rate. In January, auto stocks increased at a $.4 billion rate down from the $1.6 billion gain in December and the $8.1 billion rise in November. $.8 billion, annual rate in January. Nondurable goods inventories rose The retail trade inventory-sales ratio fell from 1.51 in December to 1.48 in January. Book value of total manufacturing and trade inventories increased at an annual rate of $28.6 billion in January (p), sharply lower than the $44.6 billion December rate. The overall manufacturing and trade inventory-sales ratio edged down from 1.46 in December to 1.43 in January. Retail trade inventories have been revised from 1972 to date, reflecting a benchmark adjustment and revised seasonal factors. The accompanying tables reflect these new data and supercede those in the March Greenbook. - 2BUSINESS INVENTORIES (Change at annual rates in seasonally adjusted book values, $ billions) 1973 Manufacturing and trade Manufacturing, total Durable Nondurable Trade, total Wholesale Retail Auto 1974 Nov. Dec. Jan. (p) 36.5 19.0 12.8 6.3 40.2 14.5 8.3 6.2 44.6 29.2 21.6 7.7 28.6 14.7 9.7 5.0 8.7 4.5 17.5 6.6 25.7 10.6 15.4 7.9 13.9 12.2 4.2 1.2 10.9 4.4 15.1 8.1 7.5 1.6 1.7 .4 1972 Dec. 1973 Jan. 1973 Dec. 1974 Jan. (p) 1.47 1.61 1.92 1.23 1.45 1.58 1.87 1.23 1.46 1.60 1.98 1.18 1.43 1.54 1.91 1.13 1.33 1.18 1.43 1.31 1.17 1.41 1.32 1.09 1.51 1.31 1.09 1.48 .856 .846 .716 .713 QIII QIV 21.1 12.4 9.8 2.6 INVENTORY RATIOS Inventories to sales: Manufacturing and trade Manufacturing, total Durable Nondurable Trade, total Wholesale Retail Inventories to unfilled orders: Durable manufacturing Manufacturers' inventory and sales anticipations. According to a survey conducted in January, manufacturers expected the book value of their inventories to increase at an annual rate of $18.0 billion in the current quarter and at a rate of $19.6 billion in the second quarter of 1974. The actual fourth quarter 1973 rate of $19.2 billion was about $8 billion larger than had been anticipated in the October survey. -3- Manufacturers expect sales to decline at an annual rate of 11.9 percent in the current quarter and to increase at an annual rate of 8.0 percent in the second quarter of 1974. percent annual rate in the fourth quarter. Sales grew at a 16.1 Inventory-shipments ratios of 1.71 and 1.74 are expected for the first and second quarters of 1974 respectively, compared with the fourth quarter ratio of 1.60. -4- The Domestic Financial Situation Mortgage market. In February, average interest rates on new commitments for conventional new- and existing-home mortgages fell by 10 and 5 basis points, respectively, according to the HUD (FHA) field office opinion survey--a finding consistent with the results of the FHLMC weekly survey of conventional mortgage rates at selected S&L's. Private secondary market yields on FHA-insured new-home mortgages averaged 8.54 percent at the end of February--64 basis points below the September peak. AVERAGE RATES AND YIELDS ON NEW-HOME MORTGAGES (HUD-FHA Field Office Opinion Survey) End of month Primary market Conventional loans Level 2/ Spread 4/ (percent) (basis points) 1973 - Low High Sept. Oct. Nov. Dec. 1974 - Jan. Secondary market 1/ FHA-insured loans Level 3/ Spread 4/ (percent) (basis points) Discounts (points) 7.70 (Jan.) 8.95 (Sept.) 30 (Jan.) 114 (Sept.) 7.55 (Jan.) 9.18 (Sept.) 15 (Jan.) 2.2 (Dec.) 137 (Sept.) 9.4 (July) 8.95 8.80 8.75 8.75 114 83 90 77 9.18 8.97 8.86 8.78 137 100 101 80 8.65 40 5.2 3.6 2.8 2.2 2.3 44 8.54 45 8.55 Feb. 1/ Any gaps in data are due to periods of adjustment to changes in maximum permissible contract rates on FHA-insured loans. 2/ Average contract rate (excluding fees or points) on commitments for conventional first mortgage loans, rounded to the nearest 5 basis points. 3/ Average gross yield (before deducting servicing costs) to investors on 30year minimum-downpayment FHA-insured first mortgages for immediate delivery in the private secondary market (excluding FNMA), assuming prepayment in 15 years. 4/ Average gross mortgage rate or yield minus average yield on new issues of Aaa utility bonds in the last week of the month. -5- Offerings to FNMA in its March 11 auction of forward purchase commitments for FHA/VA home mortgages increased sharply from the volume in recent auctions, and the average yield on accepted bids edged up by one basis point from the February 28 auction--the first increase since mid-September of last year. Rather than a surge in mortgage originations, the substantial increase in offerings reflected in part a decline in the demand for mortgages for pools to back issues of GNMA-guaranteed securities and, more generally, growing doubt among mortgage bankers that the downtrend in mortgage yields since September is likely to continue. - 6 - FNMA COMMITMENT AUCTIONS (FHA/VA HOME MORTGAGES) 1973 - High Percent of offers accepted 289 (9/4) 88 (4/16) 9.37 (9/17) 43 (8/20) 7.69 (1/8) 551 (9/4) 25 (10/15, Low Yield to FNMA l/ (percent) Offerings Accepted Received (millions of dollars) 11/26) 17 (10/15) Sept. 4 17 551 138 289 108 52 79 9.27 9.37 Oct. 1 15 30 33 25 28 25 17 22 76 68 79 9.11 8.97 8.94 Nov. 12 26 29 25 23 21 79 84 8.87 8.81 Dec. 17 39 36 94 8.78 1974 - Jan. 14 40 36 89 8.71 Feb. 11 50 49 98 8.53 25 58 42 73 8.43 11 351 285 81 8.44 Mar. 1/ Average gross yield on mortgages FNMA has committed to purchase within four months, assuming a prepayment period of 12 years for 30-year loans. The yield is calculated before deduction of 38 basis points paid by FNMA for mortgage servicing and without inclusion of FNMA commitment charges. CORRECTION Page I - 19, end of last sentence of text should be 300,000. -7INTEREST RATES 1973 Highs 1974 Lows Feb. 19 Mar. 14 Short-Term Rates 10.84(9/26) 5.61(1/3) 8.93(2/13) 9.05(8/14) 10.50(9/19) 11.69(8/9) 5.12(1/4) 5.63(1/12) 5.75(1/11) 5.81(1/5) 7.03 7.88 8.13 8.44 10.75(9/19) 5.50(1/3) 8.00(2/13) 8.25(3/13) 9.00(9/13) 10.50(9/2-) 6.80 7.75 7.16 7.54 9.80(9/13) 5.38(1/4) 5.63(1/12) 5.64(1/3) 9.38(8/15) 5.63(1/3) 7.50(2/13) 7.75(3/13) 8.50(9/13) 9.49(8/13) 5.40(1/4) 5.86(1/2) 6.39 7.01 7.02 7.67(3/13) 8.50(9/19) 6.00(c/8) 5.75(1/3) 3.20(1/3) 7.25(2/13) 3.70(2/15) 7.25(3/13) 4.20 Treasury coupon issues 5-years 20-years 3.13(8/7) 6.23(1/4) 6.04(1/3) 6.76 7.44 7.14 7.67 Corporate Seasonel Aaa Baa 7.77(8/24) 8.68(3/30) 7.10(1/2) 7.88(1/12) 7.87 8.61 8.00 8.63 8.52(8/C) 7.29(1/10) 3.05(2/13) 8.33p(3/13) Municipal Bond Buyer Index 5.59(8/1) 4.99(10/10) 5.18(2/13) 5.32(3/13) Mortgage--average yield in FNMA auction 9.37(9/17) 7.69(1/8) 8.44(3/11) Federal funds (wkly. avg.) 3-month Treasury bills (bid) Comm. paper (90-119 day) Bankers' acceptances Euro-dollars CD's (NYC) 90-119 day Most often quoted new 6-month Treasury bills (bid) Comm. paper (4-6 mo.) Federal agencies CD's (NYC) 180-269 day Most often quoted new 1-year Treasury bills (bid) Federal agencies 11.00(9/20) 9.03(3/13) 7.72 8.50 8.63 8.88 8.25 7.96(3/13) CD's (NYC) Most often quoted new Prime municipals Intermediate and Long-Term New Issue Aaa Utility 7.83(G/7) 8.53(2/11) SUPPLEMENTAL APPENDIX A* MONTHLY SURVEY OF TIME AND SAVINGS DEPOSITS AT MEMBER BANKS JANUARY 1974 Four-year consumer-type deposits at member banks showed a sharp increase of more than $1.4 billion in January according to data reported in a new special monthly survey of time and savings deposits The January increase was more than three times the December (Table 1). growth and reversed a gradual slowing in four-year deposit inflows over the October-December period. Although larger banks continued to issue the largest share of such deposits, inflows also were substantial at the smaller banks. The January surge in four-year deposits offset a sizable decline in other small denomination time deposits and accounted for almost all the increase in small denomination consumer-type balances at commercial banks during that month (Table 2, columns (3) and (1)). In addition to four-year certificates, the special survey also obtains data on large time deposits at member banks other than negotiable CD's at weekly reporting banks.1/ Over the four months for which survey data are available, these other large deposits--which are not considered to be consumer accounts--have been responsible for a major share of the growth in the "other time" component of M2 at member banks. In January, large time deposits other than negotiable CD's at weekly reporting banks increased close to $2.5 billion, thus accounting for over two-thirds of the growth in the "other time" component of M2 at member banks; the remainder of the increase was in four-year deposits (Table 3). * 1/ Prepared by Martha S. Scanlon, Economist, Banking Section, Division of Research and Statistics. Such deposits would include negotiable and non-negotiable CD's at nonweekly reporting banks and non-negotiable CD's at weekly reporting banks. TABLE 1 CHANGE IN FOUR-YEAR DEPOSITS IN DENOMINATIONS OF $1,000-$100,000 AT MEMBER BANKS BY SIZE OF BANK OCTOBER 1973 - JANUARY 1974 (In millions of dollars, not seasonally adjusted) Size of bank All member banks member banks (1) 1973 - October November December 1974 - January p Total p NOTE: (total deposits in millions of dollars) Less than 100 100 - 500 Over 500 (2) (3) + 703 + 593 + 439 + 243 + 103 + 186 + 178 + 168 + 105 + 282 + 323 + 147 +1,434 + 539 + 327 + 568 +3,169 +1,071 + 778 +1,320 Changes are calculated from deposit data reported for last Wednesday of each month. not add to totals due to rounding. p - Preliminary. (4) Figures may TABLE 2 NET CHANGE IN CONSUMER-TYPE TIME AND SAVINGS DEPOSITS AT MEMBER BANKS OCTOBER 1973 - JANUARY 1974 (In millions of dollars, not seasonally adjusted) l ls s Total savings s ladethane dep e ss t h a n $100,000 1/ Savings deposits _$1.000-$1001000 Time deposits less than $100,000 All 4-year deposits other other $9000-$100000 1973 - October November - 153 - 174 - 215 - 534 + 703 + 593 - 641 - 233 December + 904 + 106 + 439 + 359 +1071'. + 717 +1,434 -1,080 +1,648 + +3,169 -1,595 1974 - January p Total: NOTEj. 1/ Oct.-Jan. 74 Changes are calculated from single day data for last Wednesday of each month. to totals due to rounding. Column (1) is the sum of columns (2) through (4). Figures may not add TABLE 3 NET CHANGE IN "OTHER TIME" COMPONENT OF M BY TYPE OF DEPOSIT AT MEMBER BANKS OCTOBER 1973 - JANUARY 1974 (In millions of dollars, not seasonally adjusted) "Other time" deposit component of M I1/ Total time deposits of $100,000 or more less large negotiable CD's at weekly reportingbanks Savings and time deposits of less than $100000 1973 - October November +1,520 - 197 +1,673 23 - 153 - 174 December +2,326 +1,423 + 904 1974 - January +3,517 +2,446 +1,071 Total: +7,166 +5,519 +1,648 NOTE: Oct.-Jan. Changes are calculated from single day data for last Wednesday of each month. totals due to rounding. Figures may not add to 1/ "Other time" deposits equal total time and savings deposits at member banks less large negotiable CD's at weekly reporting banks. Column (1) is the sum of columns (2) and (3). SUPPLEMENTAL APPENDIX B* QUARTERLY SURVEY OF BANK LENDING PRACTICES FEBRUARY 15, 1974 The most recent Quarterly Survey of Changes in Bank Lending Practices taken February 15, 1974, indicated continued deterioration of expectations for commercial and industrial loan demand among the 125 respondents. About one-third of the participants thought that loan demand was weaker than at the time of the previous survey in November last year, and looking ahead, nearly half the respondents thought loan demand would moderate still further in the next three months (Table 1). Although by historical standards, the 10.6 per cent seasonally adjusted annual rate of growth of C&I loans at all commercial banks in the three months ending in February (roughly the period between surveys) is high, for the first three quarters of 1973 business loans grew at an annual rate of 25.9 per cent. Thus, the respondents' perception of weakness in the demand for C&I loans must be understood within the context of the extremely rapid pace of business borrowing at banks over most of last year. With loan demand weakening and the cost of funds declining, there was an easing in interest rate policy reported by more than half of the respondents, as indicated in Table 1. This is consistent with the decline in the prime rate by 50 basis points over the three-month period between surveys. A significantly higher proportion of the smaller banks--those with total assets of less than $1 billion--moved toward lower interest rates than larger banks (Table 2), but the survey results do not suggest why this is the case. As in the preceding survey, the bulk of the respondents reported that their nonprice terms of lending were unchanged from three months earlier, while the remainder reported mixed tendencies toward both ease and tightening. Moves toward ease were indications of more lenient review of credit lines of local service area customers and greater willingness to make term loans to businesses, consumer instalment loans, single-family mortgages, and participation loans with correspondents (Table 1). There were, on the other hand, some noteworthy offsetting moves toward firmness, especially at the smaller banks, in weighing the value of a loan applicant as a depositor or as a source of collateral business and in applying standards of credit worthiness to business loan applicants. Many respondents commented that careful attention was being given to loans to firms whose earnings might be adversely affected by inflation or the shortage of petroleum. Geographically, the February survey did not show any significant divergence in any of the Districts from the national pattern on expectations about loan demand or terms of lending. * Prepared by Paul W. Boltz, Economist, Banking Section, Division of Research and Statistics. NOT FOR QUOTATION OR PUBLICATION TABLE 1 QUARTERLY SURVEY OF CHANGES IN BANK LENDING PRACTICES AT SELECTED LARGE BANKS IN THE J.S. 1/ (STATUS OF POLICY ON FEBRUARY 15, 1974 COMPARED TO THREE MONTHS EARLIER) (NUMBER OF BANKS & PERCENT OF TOTAL BANKS REPORTING) MUCH STRONGER TOTAL BANKS PCT BANKS PCT MODERATELY STRONGER BANKS PCT ESSENTIALLY UNCHANGED MODERATELY WEAKER BANKS BANKS PCT PCT MUCH WEAKER BANKS PCT STRENGTH OF DEMAND FOR COMMERCIAL AND INDUSTRIAL LOANS (AFTER ALLOWANCE FOR BANK'S USUAL SEASONAL VARIATION) COMPARED TO THREE MONTHS ANTICIPATED DEMAND AGO IN NEXT 3 MONTHS 125 100.0 15 12.0 69 55.2 40 32.0 125 100.0 13 10.4 55 44.0 57 45.6 ANSWERING QUESTION BANKS LENDING TO NONFINANCIAL PCT MUCH FIRMER POLICY BANKS PCT MODERATELY FIRMER POLICY ESSENTIALLY UNCHANGED POLICY BANKS BANKS PCT PCT MODERATELY EASIER POLICY BANKS PCT MUCH EASIER POLICY BANKS PCT BUSINESSES TERMS AND CONDITIONS. 100.0 1.6 41.6 54.4 1.6 COMPENSATING OR SUPPORTING BALANCES 100.0 4.8 92.0 3.2 0.0 STANDARDS 100.0 12.8 85.6 0.0 0.0 100.0 3.2 87.2 9.6 0.0 ESTABLISHED CUSTOMERS 100.0 1.6 92.8 5.6 0.0 NEW CUSTOMERS 100.0 9.6 70.4 16.8 0.0 100.0 2.4 87.2 10.4 0.0 77.6 10.4 0.0 INTEREST RATES CHARGED OF CREDIT MATURITY OF TERM LOANS REVIEWING CREDIT LOCAL SERVICE NONLOCAL WORTHINESS LINES OR LOAN APPLICATIONS AREA CUSTOMERS SERVICE AREA CUSTOMERS 100.0 11.2 1/ SURVEY OF LENDING PRACTICES AT 125 LARGE BANKS REPORTING IN THE FEDERAL RESERVE QUARTERLY INTEREST RATE SURVEY AS OF FEBRUARY 15, 1974. NOT TABLE 1 FOR QUOTAION OR PUBLICATION ANSWERING QUESTION BANKS PCT ICONTINUED) MUCH FIRMER POLICY BANKS PCT MODERATELY FIRMER POLICY BANKS PCT ESSENTIALLY UNCHANGED POLICY BANKS PCT MODERATELY EASIER POLICY BANKS PCT MUCH EASIER POLICY BANKS PCT FACTORS RELATING TO APPLICANT 2/ VALUE AS DEPOSITOR OR SOURCE OF COLLATERAL BUSINESS 125 100.0 4 3.2 20 INTENDED USE OF THE LOAN 125 100.0 4 3.2 1 INTEREST RATES CHARGED 125 COMPENSATING OR SUPPORTING BALANCES 99 79,2 2 1.6 0 0.0 0.8 113 90.4 7 5.6 0 0.0 100.0 4.0 78 62.4 40 32.0 1.6 125 100.0 4.0 118 94,4 2 1.6 0.0 ENFORCEMENT OF BALANCE REQUIREMENTS 125 100.0 7.2 115 92.0 1 0.8 0.0 ESTABLISHING NEW OR LARGER CREDIT LINES 125 100.0 9.6 91 72.8 20 16.0 16.0 LENDING TO "NONCAPTIVE" FINANCE COMPANIES TERMS AND CONDITIONS: ANSWERING QUESTION BANKS PCT CONSIDERABLY LESS WILLING BANKS PCT MODERATELY LESS WILLING ESSENTIALLY UNCHANGED MODERATELY MORE WILLING BANKS PCT BANKS BANKS PCT PCT 0.0 CONSIDERABLY MORE WILLING BANKS PCT WILLINGNESS TO MAKE OTHER TYPES OF LOANS TERM LOANS TO BUSINESSES 125 100.0 1 0.8 3 2.4 97 77 6 24 19.2 0 0.0 CONSUMER INSTALMENT LOANS 124 100.0 1 0.8 5 4.0 96 77.5 21 16.9 1 0.8 SINGLE FAMILY MORTGAGE LOANS 122 100.0 5 4.1 9 7.4 85 69.6 23 18.9 0 0.0 MULTI-FAMILY MORTGAGE LOANS 121 100.0 7 5.8 13 10.7 93 76.9 6 6.6 0 0.0 ALL OTHER MORTGAGE LOANS 123 100.0 7 5.7 14 11.4 95 77.2 7 5.7 0 0.0 PARTICIPATION LOANS WITH CORRESPONDENT BANKS 124 100.0 4 3.2 102 82.3 14.5 0 0.0 LOANS TO BROKERS 124 100.0 9 7.3 106 85.4 6.5 0 0.0 2/ FOR THESE FACTORS. FIRMER MEANS THE FICORS WERE CONSIDERED MORE IMPORTANT IN MAKING DECISIONS FOR APPROVING CREDIT REQUESTS, AND EASIER MEANS THEf H RE LESS IMPORTANT. NOT FOR QUOTATION OR COMPARISON PUBLICATION TABLE 2 OF QUARTERLY CHANGES IN BANK LENDING PRACTICES AT BANKS GROUPED BY SIZE OF TOTAL DEPOSITS FEBRUARY 15, 1974. COMPARED TO THREE MONTHS EARLIER) (STATUS OF POLICY ON (NUMBER OF BANKS IN EACH COLUMN AS PER CENT OF TOTAL BANKS ANSWERING QUESTION) SIZE TOTAL S1 & OVER UNDER Sl 100 100 100 100 OF BANK MUCH STRONGER S1 & OVER UNDER $1 -- TOTAL DEPOSITS IN BILLIONS MODERATELY STRONGER SI & OVER 1/ UNDER $1 ESSENTIALLY UNCHANGED MODERATELY WEAKER 51 & OVER Sl & OVER UNDER S1 UNDER $1 MUCH WEAKER $1 & OVER UNDER $1 STRENGTH OF DEMAND FOR COMMERCIAL AND INDUSTRIAL LOANS (AFTER ALLOWANCE FOR BANK'S USUAL SEASONAL VARIATION) COMPARED TO THREE MONTHS ANTICIPATED DEMAND AGO IN NEXT 3 MONTHS TOTAL S1 & OVER UNDER $1 INTEREST RATES CHARGED 100 100 COMPENSATING OR SUPPORTING BALANCES 100 100 STANDARDS OF CREDIT WORTHINESS 100 100 MATURITY OF TERM LOANS 100 100 ESTABLISHED CUSTOMERS 100 100 NEW CUSTOMERS 100 100 LOCAL SERVICE AREA CUSTOMERS 100 100 NONLOCAL SERVICE AREA CUSTOMERS 100 100 MUCH FIRMER S1 & OVER UNDER 51 MODERATELY FIRMER Sl & OVER UNDER Sl ESSENTIALLY UNCHANGED Sl & OVER UNDER Sl MODERATELY EASIER Sl & OVER UNDER S1 MUCH EASIER $1 & OVER LENDING TO NONFINANCIAL BUSINESSES TERMS AND CONDITIONSI REVIEWING CREDIT LINES OR LOAN APPLICATIONS 1/ SURVEY OF LENDING PRACTICES AT 54 LARGE BANKS (DEPOSITS OF Sl BILLION OR MORE) AND 71 SMALL BANKS (DEPOSITS OF LESS THAN Sl BILLION) REPORTING IN THE FEDERAL RESERVE QUARTERLY INTEREST RATE SURVEY AS OF FEBRUARY 159 1974. UNDER Sl NOT TABLE 2 (CONTINUED) FOR QUOTATION OR PUBLICATION OF BANK MUCH FIRMER POLICY SIZE NUMBER ANSWERING QUESTION UNDER $1 S1 & OVER UNDER $1 51 & OVER UNDER 51 S1 & OVER UNDER MUCH EASIER POLICY 51 & OVER UNDER S1 $1 & OVER UNDER $1 VALUE AS DEPOSITOR OR SOURCE OF COLLATERAL BUSINESS 100 100 0 INTENDED USE OF THE LOAN 100 100 0 FACTORS RELATING TO S1 & OVER -TOTAL DEPOSITS IN BILLIONS MODERATELY ESSENTIALLY MODERATELY FIRMER UNCHANGED EASIER POLICY POLICY POLICY 51 APPLICANT 2/ LENDING TO "NONCAPTIVE" FINANCE COMPANIES TERMS AND CONDITIONS: INTEREST RATES CHARGED 3 COMPENSATING OR SUPPORTING BALANCES 0 BALANCE REQUIREMENTS 0 ENFORCEMENT OF 0 ESTABLISHING NEW OR LARGER CREDIT LINES NUMBER ANSWERING QUESTION 51 L OVER TO MAKE WILLINGNESS TERM LOANS CONSUMER UNDER 51 CONSIDERABLY LESS WILLING S1 & OVER UNDER $1 MODERATELY LESS WILLING 51 & OVER UNDER Sl ESSENTIALLY UNCHANGED $1 & OVER UNDER Sl MODERATELY MORE WILLING S1 & OVER UNDER Sl OTHER TYPES OF LOANS TO HUSINES5ES INSTALMENT LOANS SINGLE FAMILY MORTGAGE LOANS MULTI-FAMILY MORTGAGE ALL LOANS OTHER MORTGAGE LOANS PARTICIPATION LOANS WITH CORRESPONDENT HANKS LOANS TO BROKEwS 100 100 100 100 2/ FOR THESE FACTORS* FIRMER MEANS THE FACTORS WERE CONSIDERED MORE IMPORTANT IN MAKING DECISIONS FOR APPROVING CREDIT REQUEbTS, AND EASIER MEANS THEY WERE LESS IMPORTANT. CONSIDERABLY MORE WILLING Sl & OVER UNDER $1 t SUPPLEMENT APPENDIX C* DEMAND DEPOSIT OWNERSHIP SURVEY JANUARY 1974 Preliminary demand deposit ownership data indicate that the weakness in gross IPC demand deposits (not seasonally adjusted) at weekly reporting banks in January was concentrated in deposits held by nonfinancial businesses (see table). Although such deposits normally decline in January, the drop in nonfinancial business accounts in the current period was substantially larger than the average January decline of earlier years. Household deposits and deposits of financial business increased close to or only a little below the average for January in other recent years. * Prepared by Martha S. Scanlon, Economist, Banking Section, Division of Research and Statistics. Table 1 CHANGE IN LEVEL OF GROSS IPC DEPOSITS BY OWNERSHIP CATEGORY, WEEKLY REPORTING BANKS (Billions of dollars, not seasonally adjusted) Oct. Financial business Dec. Jan. Nov. .4 -. 1 -. 1 .7 .4 .4 .2 .5 n.a. -. 2 n.a. Oct. Nov. 1970 1971 1972 1973 ---- -. 1 -.1 1974 n.a. n.a. 1970 1971 -. 2 .1 1972 1973 1974 n.a. .4 -. 1 .9 -- .2 .3 2.2 2.8 n.a. -1.7 Oct. Households Nov. Dec. Jan. n.a. .4 -. 3 0 .2 .1 2.2 0 .5 .5 3.9 -1.8 0 .4 1.0 n.a. 1.3 n.a. 3.2 n.a. -1.3 -2.4 .1 n.a. .2 n.a. Jan. Oct. Nov. Dec. Jan. Oct. Nov. Dec. Jan. -.1 -. 1 -- .3 -. 1 -.1 -. 4 .1 .1 .1 .1 .5 .4 .2 -. 3 .8 1.4 1.7 .3 .3 1.4 1.4 4.5 4.1 5.1 4.2 n.a. -1.0 -1.2 -. 2 - .2 n.a. -- n.a. n.a. n.a. n.a. n.a. n.a. -1.8 n.a. -- n.a. --.2 -.1 Data are before deduction for cash items in process of collection. Figures may not add to totals due to rounding. .5 n.a. .6 .4 Total All other Dec. .7 1.0 .3 .3 Foreign Year Note: .2 n.a. Nonfinancial business Jan. Dec. Nov. Oct. 

Federal Reserve (1974, March 18). Greenbook/Tealbook. Greenbooks, Federal Reserve. https://whenthefedspeaks.com/doc/greenbook_19740319_part3

@misc{wtfs_greenbook_19740319_part3,
  author = {Federal Reserve},
  title = {Greenbook/Tealbook},
  year = {1974},
  month = {Mar},
  howpublished = {Greenbooks, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/greenbook_19740319_part3},
  note = {Retrieved via When the Fed Speaks corpus}
}