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 December 13, 1974 SUPPLEMENTAL NOTES The Domestic Nonfinancial Economy Industrial production declined further by an estimated 2.3 per cent in November. At 122.0 per cent of the 1967 base, the total index was 4.3 per cent below a year earlier. Reductions in output were widespread among consumer goods, business equipment, and industrial materials. Auto assemblies declined 16 per cent in November to an annual rate of 7.0 million units. As sales of new domestic cars continued well below production, further output cutbacks are being made in December. Production of consumer household goods was reduced sharply further in November and output of nondurable consumer goods eased off further. Production of business equipment declined 1.0 per cent as weaknesses in some equipment industries became apparent. Out- put of construction products continued to drop. Production of steel declined in November, in part because of the coal strike, and there were reductions in output of other durable and nondurable industrial materials. - 2INDUSTRIAL PRODUCTION (Seasonally adjusted) Month ago Per cent changes Annual Rate Year QIII QII QI ago 125.6 124,9 122.0 -2.3 -4.3 - 6.6 1.9 - .3 123.7 123,0 121.4 -1.3 -3.1 - 5.8 2.6 .6 Final products Consumer goods Durable goods Nondurable goods Business equipment 122.8 129.4 128.6 129.6 132,3 120.9 126. 120.4 129.0 131.0 -1,4 -1.6 -5.0 - .2 -1.1 -2.2 -5.2 -13.1 -1.9 2.5 3.0 - 6.5 -11.5 2.5 -26.6 14.7 - 5.2 -2.2 .6 7.2 Intermediate products Construction products 126.9 124.4 122.7 127.5 123.7 120.2 -1.4 -2.8 -6.4 -10.1 - 4.6 - 5.1 1.2 -2.7 -4.3 -7.7 128.8 128.0 122.9 -4.0 -6.5 - 6.4 - .3 -1.6 Total Products, total Materials r/ p/ e/ _ Indexes 1967=100 1974 Sept. Oct. Nov. (r) (P) (e) 122,6 128.6 126.8 129.3 132.4 2.3 - .6 -5.1 3.1 4.0 Revised. Preliminary. Estimated. The Wholesale price index for November rose 1.2 per cent, seasonally adjusted (not at an annual rate), to a level 23.5 per cent above a year earlier. The increase was propelled largely by higher sugar prices and a further large, but decelerating, increase in industrial commodities. The index of farm and food products increased 2.5 per cent seasonally adjusted, chiefly as a result of increases for sugar, milk, fresh fruits and vegetables, and meats. -3The index of industrial commodities rose 0.9 per cent, seasonally adjusted, paced by increases for machinery and equipment and chemicals. Also higher were prices for furniture and household durables, nonmetallic minerals, metals and metal products, and paper products. month. Lumber and wood products declined for the seventh consecutive Textile products and hides and skins also declined, and the fuels and power group was unchanged. WHOLESALE PRICES (Per cent changes at seasonally adjusted compound annual rates)¹ Nov '73 Dec.'72 June '73 Dec.'73 June '74 Sept.'74 Oct.'74 to to to to to to to Nov.'74 June'73 Dec. '73 June'74 Sept.'74 Oct. '74 Nov.'74 All commodities 23.5 20.2 10.9 18.2 35.2 29.4r 14.6 Farm and food products 15.0 45.8 10.4 -11.5 59.2 61.5r 29.9 Industrial commodities Crude materials Intermediate materials Finished goods Producer Consumer, excl.food Nondurable, excl. foods Durable 27.4 31.3 30.7 21.7 22.6 21.3 10.6 23.0 12.2 6.3 5.4 6.7 10.9 40.4 11.7 7.1 5.3 8.1 34.0 44.3 38.0 24.5 20.0 26.8 28.3 29.1 32.2 22.7 31.8 18.5 13.4 -5.2 12.6 23.5 29.1 20.8 10.3 -3.1 9.0 8.8 16.6 4.9 25.6 14.4 8.5 4.5 11.3 2.8 35.6 13.2 19.1 15.6 15.6 37.0 6.2 2.7 42.1 51.Or 29.4 -1.1 18.5 27.0 15.4 Consumer finished foods Note: Farm and food products include farm products and processed foods and feeds. 1/ Not compounded for one-month changes. -4The surge in sugar prices was a major factor in the sharp rise in the farm and food index and in the increase in the overall WPI last month. For example, if the sugar and confectionery group were excluded from the farm and food products index, the index would have declined 0.4 per cent, unadjusted, and would have been about unchanged, seasonally adjusted. If the sugar and confectionery group were excluded from the total WPI, the increase would have been 0.3 per cent, unadjusted, and an estimated 0.5 per cent, seasonally adjusted. WHOLESALE PRICES (Percentage changes) October to November, 1974 Seasonally adjusted Not seasonally adjusted Including sugar* Excluding sugar* Including sugar* Excluding sugar* WPI Farm and food products 1.0 0.3 1.2 0.5e 2.1 -0.4 2.5 O.Oe Processed foods and feeds 3.4 -0.9 3.5 *Sugar and confectionery group in processed foods and feeds. -0.8e CORRECTIONS Part I: Table I-8, line 4 from bottom of the table, Housing starts, private, QIII 1974, the figure should be 81.0 (not 16.0) per cent compound annual rate. Part II: Page 4, line 3 from the bottom, the figure should be 3.4 per cent (not 3.2). Part II: Page 6, line 7 of full paragraph, the figure should be 14 per cent (not 15). -5INTEREST RATES Highs Lows 12 Nov. 18 Dec. 9.34(11/20) 8 .06(12/il) Short-Term Rates 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 CD's (NYC) Most often quoted new Prime municipals 13.55(7/3) 8.81(2/27) 7.38 9.00 9.00 10.25 9.74<8/23) 6.93(2/6) 12.25(7/17) 7.75(2/22) 12.50(8/15) 7.75(2/26) 14.38(7/16) 8.25(2/18) 7.52 8.88 8.85 9.88 12.00( 9/4) 7.88(2/20) 8.50(11/20) 8.75(12/11) 9.86(8/23) 6.80(2/19) 12.13(7/10) 7.50(2/22) 10.63(8/28) 7.16(2/19) 7.52 8.63 8.08 7.18 8.75 7.61 11.90(8/21) 7.50(2/27) 8.25(11/20) 8.00(12/11) 9.65(8/23) 6.37(2/15) 10.18(8/26) 7.01(2/19) 7.23 8.05 '6.75 7.65 9.75(7/17) 7.00(2/27) 6.50(7/12) 3.70(2/15) 8.00(11/20) 4.40(11/22) 8.00(12/11) 4.60<12/13) 8.79(8/23) 6.72(2/14) 8.72(8/26) 7.40( 1/4) 7.61 7.94 7.26 7.83 9.40(10/8) 7.73( 1/2) 8.85 10.53(12/2) 8.54( 1/2) 10.50 8.85 10.50 Intermediate and Long-Term Treasury coupon issues 5-years 20-years Corporate Seasoned Aaa Baa New Issue Aaa Utility Municipal Bond Buyer Index Mortgage--average yield in FNMA auction 10.61(10/2) 8.05(2/13) 9.17(11/21) 9.60(12/12) 7.15(12/12)5.16( 2/6) 6.53(11/21) 7.15(12/12) 10.59( 9/9) 8.43(2/25) 9.81(11/18) 9.61(12/2) SUPPLEMENTAL APPENDIX A DEMAND DEPOSIT OWNERSHIP SURVEY * Revised data for the demand deposit ownership survey for the third quarter of 1974 indicated slower growth in gross IPC demand deposits (not seasonally adjusted) at all commercial banks. This slow- down continues the weakness reflected in the second quarter data, and is also consistent with changes in M1 over the two quarters (Table 1). Although the data are not seasonally adjusted, comparison with third quarter data for earlier survey years, and with the mean change in deposits calculated over the third quarters for the years 1970-74, indicates that changes in demand deposits in each ownership category were weaker than historical experience would have suggested (with the exception of foreign IPC deposits). Although the third quarter weak- ness was spread across ownership categories, Table 2 indicates that IPC demand deposit growth of nonfinancial businesses and households were especially weak at non-weekly reporting banks. 1/ Prepared by Steven M. Roberts, Economist, Division of Research and Statistics. Banking Section, Table 1 CHANGE IN LEVEL OF GROSS IPC DEPOSITS BY OWNERSHIP CATEGORY, ALL COMMERCIAL BANKS ¹ (Billions of dollars, not seasonally adjusted) Financial business QII QIII QIV Nonfinancial business QI QII QIII QIV Househlds Year QI 1970 1971 1972 n.a. 1.0 1.7 n.a. -.2 -2.3 --.2 -- .3 .6 .9 n.a. -6.4 -5.8 n.a. 3.3 5.0 2.7 1.9 4.0 4.6 6.9 8.4 n.a. .8 -3.9 1973 1974 -. 2 -. 2 -. 1 -. 6 .2 -. 3 .2 -7.1 -7.7 3.8 3.7 1.7 2.1 7.8 .6 -.8 -.1 -6.8 4.0 2.5 QIII--Mean 70-74 Foreign QIII Year QI QII 1970 1971 1972 1973 1974 n.a. n.a. -. 1 QIII--Mean 70-74 QIV QI -. 2 -.1 n.a. -. 1 .1 -- -- .1 .3 1.6 .1 -. 1 .3 -. 5 -. 2 .3 -. 1 0 0 -. 1 .1 .2 -1.4 0 All other QIII QI n. a. QIV QI QIII QIV n.a. 1.8 5.7 2.4 1.2 2.6 2.2 1.2 2.4 -. 3 .6 2.2 .8 1.8 .7 .9 -.7 2.6 1.7 QI QII Total QIII n. a. n.a. QII 4.9 .1 -4.2 -6.3 -8.0 -8.9 7.1 6.3 3.8 5.3 2.1 7.0 4.0 2.2 -. 3 -6.8 5.5 4.1 -1.3 Changes are based on daily averages of last-month-in-quarter to last-month-in-quarter, not annualized. Data are before deduction for cash items in process of collection. Figures may not add to totals due to rounding. 1/ QIV 7.3 9.7 12.6 9.7 Table 2 THIRD QUARTER CHANGE IN LEVEL OF GROSS IPC DEMAND DEPOSITS BY OWNERSHIP CATEGORY, AT WEEKLY REPORTING BANKS VS. NON-WEEKLY REPORTING BANKS ¹ (Billions of dollars, not seasonally adjusted) Financial business Households Nonfinancial business Year WRB Non-WRB TOTAL WRB Non-WRB TOTAL WRB Non-WRB TOTAL 1970 1971 1972 1973 1974 -. 1 -. 3 -. 4 .3 -. 2 .1 .1 .4 -. 1 -. 1 0 -. 2 0 .2 -. 3 .9 .4 1.8 -. 1 1.1 1.8 1.5 2.2 1.8 1.0 2.7 1.9 4.0 1.7 2.1 .9 .2 .5 .1 .3 1.6 1.1 2.1 1.7 .4 2.4 1.2 2.6 1.8 .7 Year WRB Foreign Non-WRB TOTAL WRB All other Non-WRB TOTAL WRB Total Non-WRB TOTAL 1970 1971 -. 2 -. 1 0 0 -. 2 -. 1 .2 -. 5 .2 -. 3 .4 -. 8 1.7 -. 2 3.7 2.4 5.3 2.1 1972 0 0 6 .2 .2 .4 2.0 5.0 7.0 1973 1974 .1 0 0 -.1 .1 -.1 .3 0 -. 1 -.1 .2 -.1 .7 1.2 3.3 1.1 4.0 2.3 Changes are based on daily averages of last-month-in-quarter to last-month-in-quarter, not annualized. Data are before deduction for cash items in process of collection. Only data for total and weekly reporting banks are reported; thus figures for non-weekly reporting banks are residuals. Figures may not add to totals due to rounding. / SUPPLEMENTAL APPENDIX B LENDING PRACTICES SURVEY, NOVEMBER 15, 1974 Loan demand was reported to be weaker or unchanged from three months earlier at the large majority of respondents to the Quarterly Survey of Changes in Bank Lending Practices taken November 15. Only 8 of the 124 responding banks predicted that loan demand would be stronger in the coming three months, while 53 banks were predicting moderation in loan demand. The weakening in demand that was being experienced and is expected for the coming quarter contrasts with the two previous surveys in which most banks had reported that credit demands from business customers were stronger and expected to intensify. The strengthening of loan demand anticipated in the May survey was borne out by subsequent loan growth, but following the August survey, growth of business loans has slackened sharply relative to the pace earlier in the year. The moderation in the intense pressure for credit led to some easing in their practices relating to interest rates charged at onethird of the respondents. Much of the easing occurred at the smaller banks (under $1 billion in deposits) on the panel, with 40 per cent of such banks reporting easing of rates. Three-quarters of the large banks on the panel indicated firmer or unchanged interest rate policies. Since the prime rate at major banks fell well over 100 basis points between the survey taken in September and the most recent survey, the unchanged or firmer policies reported must be interpreted relative to other short-term rates, particularly the commercial paper rate, which fell much more than the prime rate in the interval between surveys. Apparently, the banks reporting firmer interest rate policies--25 in all--are not lowering their rates as rapidly as market rates have dropped. In the nonprice terms of business lending, there was essentially no easing, and in some indicators of nonprice terms, further tightening had occurred at many of the respondents. Such tightening was reported by over 30 per cent of the respondents on compensating balance requirements, over 40 per cent on standards of credit worthiness in the evaluation of loan applications, and more than half on policies regarding use of the proceeds of the loan, particularly with respect to loans for speculative and "non-productive" uses. The tightening of the terms of lending follow severe tightening indicated in the May and August surveys. Nonprice terms of lending to financial businesses also have become more firm in the last three months. The tightening was most obvious in policies concerning new or larger commitments, with more than 40 per cent of the respondents reporting firmer policies in this area. - B2 There was virtually no easing in the restrictive policies toward mortgages adopted earlier in the year, and a substantial minority of the banks became more restrictive in limiting mortgages in their portfolios. * 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 U.S.¹ COMPARED TO THREE MONTHS NOVEMBER 15, 1974 (STATUS OF POLICY ON (NUMBER OF BANKS & PERCENT OF TOTAL BANKS REPORTING) MUCH TOTAL BANKS STRONGER PCT BANKS PCT EARLIER) MODERATELY STRONGER ESSENTIALLY UNCHANGED MODERATELY WEAKER BANKS BANKS BANKS PCT 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 AGO 124 100.0 12.9 66 53.2 41 33.1 ANTICIPATED 124 100.0 6.5 63 50.8 53 42.7 DEMAND IN NEXT 3 MONTHS ANSWERING QUESTION BANKS LENDING TERMS PCT MUCH FIRMER POLICY BANKS PCT MODERATELY FIRMER POLICY ESSENTIALLY UNCHANGED POLICY MODERATELY EASIER POLICY BANKS BANKS BANKS PCT PCT PCT TO NONFINANCIAL BUSINESSES AND CONDITIONS: INTEREST RATES CHARGED 100.0 3.2 16.9 46.0 COMPENSATING OR SUPPORTING BALANCES 100.0 5.6 26.6 67.8 0.0 STANDARDS 100.0 15.3 28.2 56.5 0.0 100.0 7.3 21.0 70.9 0.8 100.0 1.6 24.2 70.2 NEW CUSTOMERS 106.0 25.0 23.4 44.3 LOCAL 100.0 2.4 18.7 74.0 100.0 19.5 25.2 51.2 OF CREDIT WORTHINESS MATURITY OF TERM LOANS REVIEWING CREDIT LINES OR ESTABLISHED 33.9 LOAN APPLICATIONS CUSTOMERS SERVICE AREA CUSTOMERS NONLOCAL SERVICE AREA. CUSTOMERS 1/ SURVEY OF LENDING PRACTICES AS OF NOVEMBER 15, 1974. AT 125 LARGE BANKS REPORTING IN THE FEDERAL RESERVE QUARTERLY INTEREST RATE SURVEY MUCH EASIER POLICY BANKS PCT NOT FOR QUOTATION OR PUBLICATION 1 TABLE ANSWERING QUESTION BANKS PCT (CONTINUED) MUCH FIRMER POLICY BANKS PCT MODERATELY FIRMER POLICY ESSENTIALLY UNCHANGED POLICY MODERATELY EASIER POLICY BANKS BANKS BANKS PCT PCT PCT MUCH EASIER POLICY BANKS PCT FACTORS RELATING TO APPLICANT ² VALUE AS DEPOSITOR OR SOURCE OF COLLATERAL BUSINESS 124 100.0 15 12.1 28 22.6 65.3 INTENDED USE OF THE LOAN 124 100.0 24 19.4 37 29.8 49.2 LENDING TO "NONCAPTIVE" FINANCE COMPANIES TERMS AND CONDITIONS: INTEREST RATES CHARGED COMPENSATING OR SUPPORTING BALANCES 100.0 2 1.6 12.9 68.6 16.9 100.0 6 4.8 12.9 82.3 0.0 ENFORCEMENT OF BALANCE REQUIREMENTS 100.0 13 10.5 16.9 72.6 0.0 ESTABLISHING NEW OR LARGER CREDIT LINES 100.0 26 21.0 22.6 54.0 2.4 ANSWERING QUESTION BANKS WILLINGNESS TO MAKE PCT CONSIDERABLY LESS WILLING BANKS PCT MODERATELY LESS WILLING ESSENTIALLY UNCHANGED MODERATELY MORE WILLING BANKS PCT BANKS BANKS 21 16.9 69.4 PCT OTHER TYPES OF LOANS 100.0 TERM LOANS TO BUSINESSES 12.1 100.0 4.1 20 16.3 75.5 SINGLE FAMILY MORTGAGE LOANS 100.0 15.7 20 16.5 66.1 MULTI-FAMILY MORTGAGE LOANS 100.0 21.7 20 16.7 61.6 ALL OTHER MORTGAGE LOANS 100.0 18.9 26 21.3 59.8 CONSUMER INSTALMENT LOANS PARTICIPATION LOANS WITH CORRESPONDENT BANKS 123 100.0 8.1 14 11.4 90 73.2 LOANS TO BROKERS 123 100.0 8.1 16 13.0 95 77.3 2/ FOR THESE FACTORS, FIRMER MEANS THE FACTORS WERE CONSIDERED MORE IMPORTANT CREDIT REQUESTS, AND EASIER MEANS THEY WERE LESS IMPORTANT. IN MAKING DECISIONS FOR APPROVING PCT CONSIDERABLY MORE WILLING BANKS PCT SUPPLEMENTARY APPENDIX C MONTHLY LOAN COMMITMENT SURVEY OCTOBER 31, 1974 * The most recent Monthly Loan Commitment Survey taken at 137 large banks at the end of October indicates that total unused commitments increased substantially during October, but not enough to compensate for the decline in September; in October unused commitments remained below the year's peak reached in August. However, it is apparent from the twelve months of data now available in the monthly commitments survey that unused commitments, while large, have not been growing as rapidly as loans made under commitments. Total unused commitments to commercial and industrial firms, nonbank financial institutions, and for mortgages grew at a not seasonally adjusted annual rate of 3.7 per cent between November 1973 and October 1974, while loans made under commitments in such categories Commitments to nonbank financial institutions grew 20.5 per cent. at the 137 responding banks were essentially unchanged in the period, and commitments for mortgages fell at almost a 30 per cent annual rate. Thus, the 8.2 per cent growth of C&I unused commitments accounted for all the growth in unused commitments. With the relatively slow growth of unused commitments, the utilization ratios (the proportion of loans outstanding under commitment to total commitments) have risen steadily in nearly all categories of loans reported on the survey. However, with a current ratio of 50 per cent, the potential for takedowns at these banks is substantial. Though not keeping pace with loans made under commitments, the stock of unused commitments at major banks continues to be very large--despite the evidence from the Lending Practices Surveys and discussions with bankers that commitments policies became extremely In the present atmosphere restrictive in the spring and remain so. in financial markets, corporate borrowers place a high value on formal commitments for credit from major banks, and the banks are reported to be raising fees for commitments in response to the demand. However, the data thus far available do not provide an adequate basis for The weakening in evaluating the effectiveness of these policies. economic activity that is expected to continue for some time will likely act as a brake on the pace of takedowns in the short-term, but as economic activity picks up, the stock of unused commitments will likely again place a heavy burden on banks to meet the credit needs of their business customers. * Prepared by Paul W. Boltz, Economist, Banking Section, Division of Research and Statistics. NOT FOR QUOTATION OR PUBLICATION MONTHLY SURVEY OF BANK LOAN COMMITMENTS AT SELECTED LARGE U.S. BANKS ¹ (AS OF OCT. 31, 1974) TABLE 1 - UNUSED COMMITMENTS (DOLLAR AMOUNTS IN BILLIONS) I I I (1) FIRMS TOTAL CHG I NOVEMBER 30 83.81 DECEMBER 31 83.21 -( ).71 1 0.01 I1 FEBRUARY 28 85.21 2.51 0.91 I MARCH 31 I 85.41 MAY 31 I1 86.81 I1 JUNE 30 86.71 88.31 I 1.61 3.71 I 5.31 -4.61 4.91 5.51 4.51 10.31 I AUGUST 31 90.81 2.91 6.71 OCTOBER 31 88.61 90.71 - 2.51 2.41 OCT 74 86.71 0.71 I 6.41 -4.51 I I 5.71-10.41 I NOV 73 - 54.71 1 18.21 -1.31 I 23.51 18.51 24.01 I 0.01 I 4.51 I 0.01 I I1 56.91 1.31. 2.11 -0.51 4.11 18.41 -0.41 24.21 0.71 25.01 3.41 (8) 4.51 -1.71 4.81 7.11 4.91 1.711 1 -1.6 5.01 2.51 I 27.81 I I 27.11 -2.71 I I1 28.11 3.91 I 28.41 1.11 I 28.11 -1.31 I 8.91 0.41 -2.41 122.01 18.61 18.81 1.11 25.11 I 19.21 20.31 26.11 6.21 4.11I1 21.21 I1 2.01 21.61 I 23.31 7.81 0.21 I 3.91 27.91 2.41 I 4.51 28.01 0.41 26.71 3.61 29.011 19.61 1.91 55.41 -1.31 5.01 -0.21 27.01 -3.91 I 1.11 25.61 1.71 56.91 2.71 I 56.21 -1.31 I 56.91 1.21 58.31 57.41 56.41 56.41 4.81 -4.11 27.01 I1 4.51 -6.41 0.31 0.31 120.71 -0.8 8.21 -1.21 122.01 8.11 -1.91 120.91 -0.9 I1 4.71 4.71 5.71 26.41 0.81 1 4.71 -0.81 4.51 -4.11 27.11 2.81 I 26.51 -2.31 122.51 1 7.21 -8.31 125.11 7.91 -2.61 6.81 -5.6 I 2.31 I I 4.31 -4.31 .7 27.41 0.41 4.71 -0.41 27.21 3.41 6.51 -4.81 -2.8 1 -0.11 8.01 -2.81 LOAN COMMITMENT SURVEY ARE SELECTED WEEKLY REPORTING BANKS WITH TOTAL DEPOSITS NOTE: 1.0 I1 26.11 -3.31 I 2.41 I 56.11 -3.71 8.31 I1 NUMBER OF BANKS ** 119.11 -1.0 2.4 1 -0.81 123.01 0.8 I 8.61I 8.31 8.31 -3.71 121.71 -1.0 8.71 AVERAGE 1/ BANKS PARTICIPATING IN THE MONTHLY OF $100 MILLION OR MORE. (9) TOTAL I REAL ESTATE I COMMITMENTS MORTGAGES I AMT It CHG AMT % % CHG CHG AMT % CHG AMT I I I 0.0 0.01 120.4 0.0O 8.91 I I I. 0 6.01 0.91 57.11 I1 I 5.91 I SEPTEMBER 30 -1.01 I -8.21 6.31 24.01 I I 1.81 55.01 I -2.31 6.91 I 0.01 I 10.61 6.31 I 24.3) I 5.81 6.41 I 18.91 0.01 I 18.51 -2.31 (61 I (7) I C I I NON-BANK I OTHER I FINANCIAL INSTITUTIONS COMMITMENTS AMT % CHG AMT % CHG I I I -( 0.11 (3) (5) I (4) I C C I I I C I I REVOLVING TERM LOANS & CONFIRMED CREDITS REV. CREDITS LINES AMT I% CHG AMT % CHG AMT % CHG % CHG % CHG AMT AMT I 5.51 I I JULY 31 I I 0.11 I I I I 0.01 I 85.41 -( 0.71 APRIL 30 I 5.31 I I 86.01 TERM LOANS CHG AMT % I I JANUARY 31 (2) C &I MINOR INCONSISTENCIES MAY OCCUR DUE TO ROUNDING. ** 121.81 124.51 1.2 2.1 -2.6 2.2 1 122.01 0.3 NOT FOR QUOTATION OR PUBLICATION MONTHLY SURVEY OF BANK LOAN COMMITMENTS AT SELECTED LARGE U.S. BANKS ¹ (AS OF OCT. 31, 1974) TABLE 2 - LOANS UNDER COMMITMENTS ² (DOLLAR AMOUNTS IN BILLIONS) NOVEMBEk 30 DECEMBER 31 JANUARY 31 FEBRUARY 28 MARCH 31 APRIL 30 (1) I (21 I (3) I (4) (5) I (6) I (7) I (8) I (9) c I I C I I C I CC I I C & I C S NON-BANK I REAL TOTAL I FIRMS I TERM I REVOLVING ITERM LOANS IE CON FIRMED I OTHER IFINANCIAL ESTATE I COMMITMENTS TOTAL I LOANS I CREDITS IREV. CREDITSI LINES ICOMMITMENTS IINSTITUTIONSI MORTGAGES I ANT 12 CHtr ANT il CNCi AMT I r c I AMT It runr. ~W" i i V . AMT Ma l 1I CHGI AMT IZ CHGI AMT I1 CHG AMT AMT IZ CHGI CHGI AMT .11 CMH 12 I I 195 I I I I I I I I 70.31 0.01 18.51 0.01 0.01 38.01 0.01 25.81 0.01I 6.51 0.01 18.11 0.01 18.01 0.01 106.41 0.0 19.51 1 1 I I I1 I 71.91 2.31 19.01 2.81 19.51 -0.11 38.51 1.31 26.61 3.41 6.71 3.01 19.81 9.71 18.21 1.31 109.91 3.3 I I -7.11 I I 70.81 -1.41 18.91 -0.51 19.61 0.51 38.41 -0.31 25.51 -4.21 6.81 1.41 18.41 18.21 0.01 107.51 -2.2 I 1 1 I1 I I 1 10.2 72.31 2.11 19.11 1.21 20.11 2.51 39.21 2.11 26.51 3.71 6.61 -2.81 18.31 -0.41 18.31 1.3 0.21 108.9) I I1 I I 1 77.01 6.51 19.41 1.31 21.01 4.71 40.41 3.01 29.81 12.51 6.81 3.51 19.31 5.61 5.3 18.41 0.61 114.81 I1 1 I1 I 79.21 2.81 20.51 5.61 21.31 1.01 41.71 3.21 30.91 6.61 -3.11 18.41 -0.21 118.21 20.61 6.51 2.9 I1 MAY 31 JUNE 30 JULY 31 79.81 82.11 I 83.71 0.81 20.61 I1 I 2.91 20.91 1 1.91 21.51 0.91 21.61 1.81 42.31 I 1.01 22.11 84.61 1.11 SEPTEMBER 30 86.91 2.71 23.01 OCTOBER 31 85.01 -2.11 NOV 73 - OCT 74 AVERAGE 79I 79.41 1.8 2.21 23.31 1.81 24.61 22.4121.5I 1 -4.011 24.81 1.41 21.91 22.01I 20.51 7.21 7.91 20.51 -0.61 2.31 43.01 1.71 32.11 5.51 7.11 -1.31 22.21 8.71 3.71 44.51 3.41 32.21 32.21 0.41 22.41 0.81 0.01 7.01 7.11 -0.31 7.01 0.71 I1 AUGUST 31 30.41 -1.51 18.41 0.01 118.71 0.4 I1 I1 3.11 I1 I 1.41 1.41 1 I1 1.51 45.31 1.81 32.21 5.41 47.01 3.71 0.91 46.31 -1.41 32.91 2.21 I 31.61 -3.71 I1 2.21 1 42.41 1.68 30.01 2.01 22.11 -1.81 6.91 0.91 1 18.31 -0.21 122.71 3.4 I 1 19.51 6.21 125.61 2.3 I 19.01 -2.51 125.61 0.0 I 19.11 0.61 128.41 2.2 1 19.31 1.11 126.41 -1.5 6.91 0.81 20.71 18.6 18.61 I 22.01 -1.9| I 7.11 -1.01 1 22.51 2.11 I1 2.01 . 0.71 118.81 NUMBER OF BANKS 1/ BANKS PARTICIPATING IN THE MONTHLY LOAN COMMITMENT SURVEY ARE SELECTED WEEKLY REPORTING BANKS WITH TOTAL DEPOSITS OF $100 MILLION OR MORE. 2/ LOANS UNDER COMMITMENTS ARE DEFINED AS ALL LOANS UNDER COMMITMENTS CURRENTLY OR PREVIOUSLY IN FORCE, LESS REPAYMENTS OF THE PRINCIPAL. THE REPORTED DATA ARE DISTORTED BY TAKEDOWNS OF LOAN COMMITMENTS BY OVERSEAS BRANCHES OF US BANKS AND LOAN SALES. 1.6 1.6 MONTHLY SURVEY OF BANK LOAN COMMITMENTS AT SELECTED LARGE U.S. BANKS ¹ (AS OF OCT. 31, 1974) NOT FOR QUOTATION OR PUBLICATION TABLE 3 - UTILIZATION RATIO ² (PERCENTAGES) I (1) I I FIRMS TOTAL I C I (2) C c I TERM LOANS (3) I C REVOLVING CREDITS (71 (6) I 1 (5) I (4) I NON-BANK C c I I I C c I CCI OTHER I FINANCIAL ITERM + REV.I CONFIRMED I INSTS. ICOMMITMENTSI I LINES I I I I I (8) REAL I ESTATE MORTGAGES I I (9) TOTAL I 110) SHORT -TERM TOTAL3/ . I 47.0 39.7 67.2 67°2 48.0 41.0 39.6 67.7 46.8 39.4 39.2 68.0 47.0 39.6 57.9 40.8 68.9 48.5 41.7 35.8 57.2 43.3 68.8 49.5 42.8 62.8 34.8 S 60.1 43.1 69.0 49.3 42.5 53.6 62.3 36.3 61.3 46.0 69.4 50.4 44.1 77.3 53.0 62.5 36.1 59.9 46.0 71.2 50.6 43.9 48.2 76.6 52.4 61.9 35.6 60.3 44.8 72.5 50.1 43.2 SEPTEMBER 30 49.5 77.8 53.2 62.7 37.0 S 61.0 45.9 73.7 51.3 44.5 OCTOBER 31 48.4 79.0 51.6 61.5 35.5 62.3 44.7 74.9 50.4 43.3 47.5 77.2 52.5 62.1 34.4 69.9 49.1 42.1 30 45.6 77.6 50.8 61.0 31.9 59.0 DECEMBER 31 46.4 77.4 51.4 61.6 32.8 JANUARY 31 45.4 78.2 51.8 61.9 FEBRUARY 45.7 77.6 52.1 MARCH 31 47.4 77.0 APRIL 30 48.1 MAY 31 I 39.4 67.7 60.1 42.3 31.0 58.8 62.0 31.7 57.7 53.3 62.6 34.6 76.2 53.3 62.5 47.9 76.8 53.5 JUNE 30 48.6 75.2 JULY 31 48.7 AUGUST 31 NOVEMBER 28 NOV 73 - OCT AVERAGE 74 I I I I 596 I 42.9 I 59.6 I 42.9 I NUMBER OF BANKS 1/ 2/ 3/ BANKS PARTICIPATING IN THE MONTHLY LOAN COMMITMENT SURVEY ARE SELECTED WEEKLY REPORTING BANKS WITH TOTAL DEPOSITS OF $106 MILLION OR MORE. THE UTILIZATION RATIO IS THE RATIO, EXPRESSED AS A PERCENTAGE, OF LOANS UNDER COMMITMENTS TO THE SUM OF UNUSED COMMITMENTS AND LOANS UNDER COMMITMENTS EXCLUDES REAL ESTATE LOANS AND TERM LOANS. NOT FOR QUOTATION OR PUBLICATION MONTHLY SURVEY OF BANK LOAN COMMITMENTS AT SELECTED LARGE U.S. BANKS ¹ (AS OF OCT. 31, 1974) TABLE 4 - NEW COMMITMENTS (DOLLAR AMOUNTS IN BILLIONS) (8) (9) (7) I I (5) I (6) I (4) 1 (3) (1) I (2) 1 TOTAL NON-BANK I REAL I CCI I C C I I C I I C I C e I I I ESTATE I COMMITMENTS FINANCIAL I OTHER FIRMS TERM I REVOLVING ITERM LOANS SI CONFIRMED I MORTGAGES I TOTAL I LINES ICOMMITMENTS INSTITUTIONS! LOANS I IREV. CREDITSI CREDITS It CG AMT I r CGI AMT It CHGI AMT IZ CHGL AMT 12 CHGI AMLT AMT It CHGI AMT CLHG!. AMT 12 CtE I1 CHGt AMT I I I I I 4.91 0.01 I 0.01 1.21 I 1.11 0.01 I I 5.01 1.11 1.31 22.61 I I I I I NOVEMBER 30 DECEMBER 31 JANUARY 31 4.81 -3.01 0.81-39.61 FEBRUARY 28 I I 4.51 -6.41 I I 0.81 MARCH 31 6.21 1.31 59.71 I I 38.11 6.91 11.01 APRIL 30 MAY 31 I JUNE 30 JULY 31 AUGUST 31 SEPTEMBER 30 OCTOBER 31 NOV 73 - OCT 74 I 2.41 I 1.21 -8.81 I I 1.31 6.21 I I 6.21 -5.81 I I 7.21 15.81 I I 6.61 -9.11 I I 6.31 -4.51 I I 6.11 -2.71 6.0 2. I I 6.01 2.71 I 1.21 -5.71 I I I 2.31 I 0.01 1.81 0.01 I 1.11 -5.81 I I 0.91-21.91 I I 0.91 5.91 I I 2.41 8.01 1.71-31.71 I I 1.71 3.91 I I 0.01 I 1.81 -0.91 2.11 0.81 22.11 1.11 22.11 0.81 I 1 0.91-11.11 I I 22.61 2.11 -3.01 0.61-30.21 2.61 50.41 2.71 31.21 0.61 10.61 1.61 28.51 I 2.81 3.01 8.41 0.61 -0.51 I I 1.51 -5.91 I 1 5.51 1.61 1.21 0.81 2.6) 58.11 I I 1.01-15.81 I I 2.41 -5.31 1.01 -5.71 I I 2.31 -5.01 I 0.81-13.4| 2.21 I 1 I I I 1.11 0.21 1.61 I 1.61 I -5.91 . I 8.11 I I 2.81 -0.41 I 2.81 I 3.81 f 3.51 I 3.31 I 3.01 0.31 I 33.51 1 -8.51 I -5.21 I -8.11 .7 4.1 2.71 I I 2.81 -5.41 0.71 9.71 2.61 -5.91 0.61 -8.31 I 4.71 I 0.01 I 0.71-13.31 1.31 41.31 I 9.11 I 0.91 I 1.41 27.41 I I 1.21-12.21 I I 2.71 0.91 0.61 -2.71 1.11 -6.31 2.41 -9.41 0.51-13.91 1.21 0.61 11.51 I I 0.81 -34.2'1 I I 2.41 -1.51 2.41 -0.91 I 0.71-24.31 I I 0.91 27.71 I I 1.11 18.71 0.71 I 19.91 1.11 29.71 I I 2.41 3.21 0.71 0.51 9.11 1.0L I I 4.21 I I 0.81 0.01 I I 1.01 34.31 I I 0.91-13.21 I I 0.81 -8.21 I I 0.91 11.41 I I 0.91 1.71 I I 0.91 -1.71 I I 0.91 -4.11 I I 0.71-22.01 I I 4.81 0.71 I I 0.51-24.11 0.51 -6.41 I 8.11 33.2 1 8.91 10.7 8.91 -0.2 8.31 -6.6 9.01 8.6 I 8.51 -5.6 7.71 -9.4 7.71 0.5 7.81 2.2 I 0.81 -2.51 NUMBER OF BANKS 1/ BANKS PARTICIPATING IN THE MONTHLY LOAN COMMITMENT SURVEY ARE SELECTED WEEKLY REPORTING BANKS WITH TOTAL DEPOSITS OF $100 MILLION OR MORE. MINOR INCONSISTENCIES MAY OCCUR DUE TO ROUNDING. ** 7.11 7.7 I 6.71 -5.6 1 6.11 -9.1 -2.51 AVERAGE ** NOTE: 0.0 I I 0.8 6.61 SUPPLEMENTAL APPENDIX D GERMmAN POLICY ANNOUNCEMENT OF DECEMBER 12, 1974* Following two days of Cabinet deliberations, on December 12 the German government announced measures to restimulate the faltering domestic economy. In a joint press conference of the Ministers of Economics, Finance and Labor the government presented a package which includes substantial investment incentives, increased assistance to the unemployed, and use of part of the countercyclical funds held on deposit with the Bundesbank. As described by the Ministers, the main features of the new program are summarized below: 1) Investment Incentives. A bonus of 7.5 per cent will be paid to enterprises ordering investment goods or commencing projects for the seven months between December 1, 1974 and June 30, 1975. In order to assure swift impact on the economy, goods so ordered must be delivered by July 1, 1976, and qualifying construction projects must be completed by July 1, 1977. An exception will apply to delivery of goods on major energy projects, where delivery will be permitted as late as July 1, 1978. The investment bonus method is reported to have been chosen in preference to tax credits, since the latter might have little incentive effect for enterprises currently losing money and having little if any tax liability. This measure will require special legislation. 2) Government Investment. The Federal Government, using a portion of the countercyclical funds to be drawn from special deposits held with the Bundesbank, will spend DM 1.13 billion in priority sectors such as construction and energy. Projects will be chosen for their immediate impact and low followup costs. This portion of the program will supplement the DM 950 million in sectoral assistance, primarily to construction, announced in September. 3) Labor Assistance. A further DM 600 million will be spent by the Federal Labor Office to combat rapidly rising unemployment, which in November reached almost 800,000 out of a labor force of 23 million. Seasonally adjusted, the German unemployment rate has climbed steadily this year, from 1.6 per cent in January to a level of 3.8 per cent in November; and the number of workers on short-time reached 461,000 in the same month. Under the new program, employers who hire the unemployed prior to May 1, 1975, will receive special incentive payments over a six month period. In addition, the Federal Labor Office will provide relocation incentives to unemployed workers and make available supplementary benefits to workers on short-time for a period of two years, as against the one year period presently in effect. * Prepared by John F. Wilson, Economist, World Payments and Economic Activity Section, Division of International Finance. D -2 The estimated cost during 1975 of the programs outlined above is DM 1.73 billion, which will be met by the government's drawing DM 3.5 billion of the countercyclical funds raised through the now-expired temporary stability surcharges on investment expenditures and on personal income taxes. The drawing represents about one-third of the DM 10 billion in such funds. The difference between the drawing and cost of the December 12 program will reportedly be applied to the budget deficit for 1975, which for the Federal and State Governments is now estimated to total some DM 50 billion. With the measures announced on December 12, overall German policy has clearly shifted toward combating the recessionary influences which have deepened throughout 1974. The stimulus provided by the package is meant to take effect quickly, and will supplement previously announced tax reform measures going into effect in January, 1975, and the recent easing of monetary policy, as described in the December 11 Greenbook. In early December the Bundesbank Central Council also announced, for the first time, a target of 8 per cent growth for the monetary base during 1975. 

Federal Reserve (1974, December 16). Greenbook/Tealbook. Greenbooks, Federal Reserve. https://whenthefedspeaks.com/doc/greenbook_19741217_part2

@misc{wtfs_greenbook_19741217_part2,
  author = {Federal Reserve},
  title = {Greenbook/Tealbook},
  year = {1974},
  month = {Dec},
  howpublished = {Greenbooks, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/greenbook_19741217_part2},
  note = {Retrieved via When the Fed Speaks corpus}
}