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 this document may contain occasional gaps in the text. These gaps are the result of a redaction process that removed information obtained on a confidential basis. 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 optimal 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. CONFIDENTIAL (FR) CLASS II - FOMC March 25, 1983 SUPPLEMENT CURRENT ECONOMIC AND FINANCIAL CONDITIONS Prepared for the Federal Open Market Committee By the Staff Board of Governors of the Federal Reserve System TABLE OF CONTENTS Page THE DOMESTIC NONFINANCIAL ECONOMY Existing home sales . . . . . . . . . . . . . . . . . . . . . . Agricultural developments . . . . . . . . . . . . . . . . . . . TABLES: Existing homes sold . . . . . . . . . . . . . . . . . . . . . USDA supply-demand estimates for selected farm crops . . .. THE DOMESTIC FINANCIAL ECONOMY TABLES: Monetary aggregates . . . . . . . . . Commercial bank credit and short- and term business credit . . . . . . . Selected financial market quotations . . . . . . . . . . . . intermediate. . . . . . . . . . . . . . . . . . . . . . . . SUPPLEMENTAL NOTES THE DOMESTIC NONFINANCIAL ECONOMY Existing home sales Sales of existing homes 14 percent in January. fell 4 percent in February, after rising Taken together, home sales during the first two months of 1983 were up 18 percent from the pace in the fourth quarter of 1982. Price increases have remained moderate; in February, both average and median sales prices of existing homes were about 2 percent above year earlier levels. Agricultural developments Farmers participating in the administration's acreage reduction programs have agreed to devote 82 million acres of crop land to conservation uses in 1983, about one-third of the acreage base of those crops directly affected by the programs. Even assuming that some farmers drop out of the programs during the year, the level of idled acreage this year appears likely to exceed the previous peak levels of the 1960s. The acreage cutbacks are expected to lead to sharp declines in the output of some farm crops. The Agriculture Department's initial-- and highly tentative--supply-demand projections for the 1983-84 marketing year show 1983 corn production down about one-third from 1982, wheat production off nearly 20 percent, and soybean production declining by less than 10 percent. Because of large stocks remaining from earlier harvests, the total supplies of these crops are not expected to fall by as much as current production. -2- The USDA projections show corn inventories falling to about a three month supply at the end of the 1983-84 marketing year; this level of stocks would be down considerably from that of the current marketing year, but would still be well above the stocks of the 1973-75 period when end-of-year inventories were less than a one month supply. The USDA is projecting that wheat inventories will remain quite high at the end of the 1983-84 marketing year; the months' supply of soybeans at the end of the 1983-84 marketing year is expected to be in about the range of most recent years. EXISTING HOMES SOLD Period 1978 1979 1980 1981 1982 .... .... .... .... .... Sales Volume (Thousands of Units,Saar) Sales Prices Average Median Percent Percent Level Change Level Change ($1000) Year Earlier ($1000) Year Earlier 3986 3826 2974 2418 1991 55.1 64.0 72.7 78.0 80.4 17.0 16.2 13.6 7.2 3.1 48.7 55.5 62.0 66.1 67.7 13.9 14.1 11.7 6.6 2.4 1981 Q3.. Q4.. 2313 2000 79.7 77.6 5.2 4.7 67.6 66.2 4.9 4.5 1982 Q1.. Q2.. Q3.. Q4.. 1970 1953 1893 2133 79.2 80.8 81.3 80.1 4.3 2.8 2.0 3.3 66.8 68.1 68.5 67.5 3.8 2.5 1.3 2.0 1982 Jan. Feb. Mar. Apr. May June July Aug. Sept Oct. Nov. Dec. 1890 1990 2030 1960 1920 1980 1910 1860 1910 1990 2150 2260 79.8 78.8 79.1 79.4 80.6 82.3 82.0 82.0 80.0 79.3 80.4 80.6 4.9 4.1 3.8 2.7 2.5 3.0 3.0 1.9 1.1 3.5 3.7 2.5 66.4 66.9 67.0 67.1 67.8 69.4 69.2 68.9 67.3 66.9 67.7 67.8 2.9 4.4 4.0 2.8 2.3 2.5 2.5 1.2 0.3 1.4 2.7 1.8 1983 Jan. r Feb. p 2580 2470 80.0 80.4 0.3 2.0 68.1 68.3 2.6 2.1 r--Revised. p--Preliminary. USDA SUPPLY-DEMAND ESTIMATES FOR SELECTED FARM CROPS Marketing year beginning in 1980 U.S. Production: Corn Wheat Soybeans Total U.S. 1981 1982(p) 19 8 3(p) Percent change, 1982 to 1983 - - - - - - - Millions of bushels- - - - 6645 2374 1792 8202 2799 2000 8397 2809 2277 5640 2265 2100 -32.8 -19.4 -7.8 8263 3279 2151 9237 3791 2318 10684 3977 2543 9075 3850 2480 -15.1 -3.2 -2.5 7229 6951 7250 7200 -.7 supplies: Corn Wheat Soybeans Total domestic use and exports: Corn Wheat Soybeans 2290 2627 1833 2052 - - - - - -Months' 2395 2410 2163 2195 supply1- - - - - - - - - .6 1.5 End-of-year stocks: Corn Wheat Soybeans 1.7 5.2 2.1 3.9 5.3 1.6 5.7 7.9 2.1 3.1 7.2 1.6 p = USDA projections as of March 23, 1983. 1. End-of-year stocks relative to total use during the preceding marketing year. --- MONETARY AGGREGATES (Based on seasonally adjusted data unless otherwise noted)1 1982 Q2 Q3 Q4 1983 Dec. Jan. Feb.P Feb. '82 to Feb. '83P 9.6 (9.7) 12.8 10.8 --Percentage change at annual rates-Money stock measures 1. Ml 2. (M 1 ) 3. M2 4. M3 2 Selected components 5. Currency 13.1 (14.5) 9.3 9.5 3.2 (4.2) 7.0 8.5 6.1 (4.3) 10.9 12.5 8.7 7.2 7.4 10.6 (9.4) 8.9 3.8 9.8 (6.3) 29.8 12.2 22.2 (23.9) 24.3 13.6 8.2 12.7 12.5 11.1 -2.0 -3.5 1.4 6. Demand deposits -5.4 0.0 8.4 7. Other checkable deposits 19.3 21.6 34.0 14.4 36.7 92.0 34.8 8. M2 minus Ml (9+10+11+14) 8.3 12.4 8.1 8.3 36.2 24.9 13.9 2.1 28.6 23.9 -21.3 84.0 48.1 29.7 22.4 11.2 35.0 12.6 15.1 9.9 -56.5 37.8 -102.1 102.8 -50.4 44.4 2.3 25.2 -1.7 17.0 2.8 -1.8 -18.7 5.7 35.3 -0.4 4.1 169.0 -18.2 4.9 479.7 -83.6 15.5 189.5 -63.6 22.9 92.3 -4.9 6.9 0.4 3.7 2.8 6.9 30.1 -5.9 72.6 -23.0 248.8 -88.4 170.0 -62.3 16.0 20.0 10.4 -19.5 -70.0 -40.5 1.3 17.5 17.0 19.1 13.4 12.9 15.6 4.3 -1.3 29.3 -22.6 -28.5 -1.8 -82.3 -86.2 -64.8 -48.2 -58.5 -7.6 -3.6 -6.9 11.0 10.4 16.9 109.3 -11.9 32.7 34.4 -55.3 27.4 -37.8 11.9 -23.4 8.8 34.5 14.8 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 3 Overnight RPs and Eurodollars, NSA General purpose and broker/dealer money market mutual fund shares, NSA Commercial banks savings deposits, SA, plus 4 MMDAs, NSA small time deposits Thrift institutions savings deposits, SA, plus 4 MMDAs, NSA small time deposits M3 minus M2 (18+21+22) Large time deposits 5 at commercial banks, net at thrift institutions Institution-only money market mutual fund shares, NSA Term RPs, NSA -Average MEMORANDA: 23. Managed liabilities at commercial banks (24+25) 6 Large time deposits, gross 24. 6 Nondeposit funds 25. 26. Net due to related foreign 6 institutions, NSA 27. Other6 ,7 28. U.S. government deposits at commercial 8 banks 56.4 -12.4 monthly change in billions of dollars-- 1.6 5.7 -4.1 -4.1 -6.5 2.4 0.4 0.1 -4.4 0.3 -0.8 3.2 -1.6 0.2 0.3 -37.2 -28.1 -9.1 -13.9 -16.3 2.4 -38.3 -24.4 -13.9 -3.0 2.6 -14.1 5.0 0.4 2.0 -31.6 17.6 1.3 3.8 -6.9 -13.7 -13.3 -0.4 -8.6 1. Quarterly growth rates are computed on a quarterly average basis. Dollar amounts shown under memoranda for quarterly changes are calculated on an end-month-of-quarter basis. 2. M1 seasonally adjusted using experimental model-based procedure applied to weekly data. 3. Overnight and continuing contract RPs issued to the nonbank public by commercial banks plus overnight Eurodollar deposits issued by branches of U.S. banks to U.S. nonbank customers, both net of amounts held by money market mutual funds. Excludes retail RPs, which are in the small time deposit component. 4. Beginning December, 1982, growth rates are for savings deposits, seasonally adjusted, plus money market deposit accounts (MMDAs), not seasonally adjusted. Savings deposits excluding MDAs declined at commercial banks at annual rates of 21.7 percent in December, 88.2 percent in January and 57.1 percent in February. At thrift institutions, savings deposits excluding MMDAs declined during December, January and February at annual rates of 27.6 percent, 87.2 percent, and 21.8 percent, respectively. 5. Net of large-denomination time deposits held by money market mutual funds and thrift institutions. 6. Adjusted for shifts of assets and liabilities to International Banking Facilities (IBFs) which affected flows from December 1981 to September 1982. consists of borrowings from other than commercial banks in the form of federal funds purchased, securities under agreements to repurchase and other liabilities for borrowed money (including borrowings from the Federal Reserve and unaffiliated foreign banks), loans sold to affiliates, loan RPs and other minor items. Data are partially estimated. 8. Consists of Treasury demand deposits at commercial banks and Treasury note balances. p--Preliminary. -6COMMERCIAL BANK CREDIT AND SHORT- AND INTERMEDIATE-TERM BUSINESS CREDIT 1 (Percentage changes at annual rates, based on seasonally adjusted data) 1982 Q2 Q3 Q4 1983 Dec. Jan. Feb. Feb. '82 to Feb. '83 --Commercial Bank Credit-1. Total loans and investments 2 3 at banks , 8.0 5.8 3 4.7 4.8 3. Treasury securities 4.9 8.3 4. Other securities 4.8 3.0 2.5 9.1 6.2 3.0 5.1 15.0 9.0 -.2 .0 -26.8 63.6 2. 5. Investments 2 3 3 Total loans , 2 3 6.3 10.5 12.8 15.9 26.1 41.7 13.8 11.5 43.0 42.7 81.6 40.3 25.3 17.3 20.0 -. 9 4.6 2.8 5.3 6.6 8.5 1.2 8.2 7.5 7.6 6. Business loans , 7. Security loans 8. Real estate loans 6.6 2.8 4.9 6.4 7.1 6.3 5.3 9. Consumer loans 2.8 3.0 4.6 9.5 6.3 1.9 3.7 37.2 66.7 -97.2 -26.4 6.7 --Short- and Intermediate-Term Business Credit-10. 11. 12. Total short- and intermediateterm business credit (sum of 3 lines 14, 15 and 16) Business loans net of bankers 3 acceptances Commercial paper issued by non4 financial firms 13. Sum of lines 11 & 123 14. Line 13 plus loans at foreign 5 branches3, 15. 16. Finance company loans to business 6 Total bankers acceptances outstanding 11.7 9.2 15.9 9.0 2.8 -6.2 -39.6 -38.1 14.1 7.0 -4.5 -4.7 -4.8 4.0 5.3 8.4 -4.8 -4.8 -2.6 4.6 6.0 -16.1 1.5 n.a. n.a. -4.6 n.a. n.a. 15.8 6 6.6 -2.9 .6 -15.2 22.9 -3.1 -2.5 n.a. n.a. -.3 7.8 3.0 8.6 20.4 -104.0 12.7 -40.5 1. Average of Wednesdays for domestically chartered banks and average of current and preceding ends of months for foreign-related institutions. 2. Loans include outstanding amounts of loans reported as sold outright to a bank's own foreign branches, unconsolidated nonbank affiliates of the bank, the bank's holding company (if not a bank), and unconsolidated nonbank subsidiaries of the holding company. 3. Adjusted for shifts of assets and liabilities to International Banking Facilities (IBFs) which affected flows from December 1981 to September 1982. 4. Average of Wednesdays. 5. Loans at foreign branches are loans made to U.S. firms by foreign branches of domestically chartered banks. 6. Based on average of current and preceding ends of month. n.a.--Not available. 

Federal Reserve (1983, March 28). Greenbook/Tealbook. Greenbooks, Federal Reserve. https://whenthefedspeaks.com/doc/greenbook_19830329_part1

@misc{wtfs_greenbook_19830329_part1,
  author = {Federal Reserve},
  title = {Greenbook/Tealbook},
  year = {1983},
  month = {Mar},
  howpublished = {Greenbooks, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/greenbook_19830329_part1},
  note = {Retrieved via When the Fed Speaks corpus}
}