Regional President Speech

REAL 3STATE CREDIT CONFERENCE Federal Reserve Bank of Philadelphia Friday, October 20, 1950 I. CONDITIONS WHEN KOREA WAS INVADED LATE IN JUHE A. Employed in June . ... 61*5 million 11 a year before .59*6 " B. Industrial production index . . 199 From ....................... 169 a year before C. Credit had been expanding D. Prices rising II. EFFECTS OF KOREA A. No unused capacity as in 1939 B. Rapid increase in planned Government expenditure for defense C. Immediate impact 1. Increased expenditures of business 2. Increased expenditures of consumers (Read release of Friday) III. NATURE OF INFLATION A. Excess of demand over supply B. Many sectors on the frcnt 1. Produce more 2. Save more - spend less Wage demands and offers Wage policies of unions ) self- Price demands and offers Pricing " " mfgrs. )discipline St— Types pf-pttbl-ie-^oatpol-s IV. LIMITING CIVILIAN DEHAND A. Taxation B. Over-all monetary controls 1. Money supply increased $2 pillion to $172 billion in third quarter alone 2. Velocity outside New York at 21 - highest in over a decade 3. System actions in making reserves more expensive Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis - 2 - C. Selective credit controls - where expansion has been greatest 1. Consumer durables - instalment credit (a) Increase in third quarter . . . . $1.2 billion Third quarter - 1949...... . • $0.8 n (b) Amount: End of September . . . .$13 " plus Up about l/3 in a year 2. Housing (a) Number of starts 194 8 800,000 Rate this year .... 1,300,000 (b) Credit New loans - 9 months 1950 ....... Ill billion Yearly - 1947-49 ............... 11 " (c) Outstanding - new minus repayments (1 to 4-family houses) Third quarter . . . . . • . . . • • £ 2 billion 1949 4 (Order L-41) V. DIRECT CONTROLS Long 15% defense vs. shorter 50$ ^ar In real terms - a war/defense must be paid for as we go. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Karl R. Bopp (1950, October 19). Regional President Speech. Speeches, Federal Reserve. https://whenthefedspeaks.com/doc/regional_speeche_19501020_karl_r_bopp

@misc{wtfs_regional_speeche_19501020_karl_r_bopp,
  author = {Karl R. Bopp},
  title = {Regional President Speech},
  year = {1950},
  month = {Oct},
  howpublished = {Speeches, Federal Reserve},
  url = {https://whenthefedspeaks.com/doc/regional_speeche_19501020_karl_r_bopp},
  note = {Retrieved via When the Fed Speaks corpus}
}