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TABLE 19.—Offerings of new security issues, 1972—73[Billions of dollars]PeriodTotalCorporate securitiesBonds andnotesStocksState andlocalgovernmentsecurities1972197340.833.127.821.813.111.322.922.81972:1IIIII .. .IV1973:1. .IIIIIIV9.811.29.210.68.28.66.49.96.97.46.17.44.46.24.66.62.93.83.13.33.92.41.73.35.96.15.45.65.65.65.16.4i Preliminary.Note.—Detail may not add to totals because of rounding.Sources: Securities and Exchange Commission and The Bond Buyer.savings deposits decreased the net inflow of funds into thrift institutions. Thetightness in mortgage markets was less severe than in 1966 and 1969.In 1972, conditions in credit markets were relatively easy, and net savingsflows into thrift institutions were large (Table 20). The rate of this netinflow moderated during the first half of 1973, but it still remained substantial,partly because of unusually large tax refunds. Mortgage repaymentflows were also ample. Mortgage loan commitments outstanding atall savings and loan associations reached a record $15.1 billion in May. Asshort-term open market rates increased sharply, net savings inflows into thriftinstitutions excluding interest credited were reduced, and for the duration ofthe third quarter they turned into net outflows. Savings and loan associationsdecreased new commitments, borrowed heavily from the Federal HomeLoan Banks (FHLB), and sold liquid assets in order to meet existing commitments.Inclusion of interest credited into the net savings flow would stillyield a negative figure for the third quarter, though with seasonal adjustmentthe sharp diminution from earlier quarters would then leave the netthird-quarter flow positive.The progressive reduction of net savings flows to the thrift institutionstightened conditions in mortgage markets and induced Federal regulatoryagencies to take steps to revive this market. In July, maximum interestrates payable on time and savings deposits by thrift institutions were adjustedupward. Also the Federal Home Loan Bank Board lowered liquidityrequirements at member institutions, freeing additional funds for mortgagelending. Ceilings on FHA-VA mortgages were raised from 7 to 8JJ/2 percentin two steps in order to attract more funds to Government-backedmortgages.86
Assistance to Mortgage MarketsMortgage markets received substantial support from federally sponsoredhousing agencies in 1973. These agencies channeled funds from theopen market to mortgage markets and thus eased the availability ofmortgage credit. In addition, the President announced measures to help themortgage and housing sector in both the short and long run.Federal Home Loan Bank advances outstanding to member savings andloan associations reached $15 billion in December, compared to $8 billionat the end of 1972. The $7 billion net increase may be compared with a riseof $4 billion during 1969.TABLE 20.—Net savings flows at thrift institutions, 1968-73[Billions of dollars, not seasonally adjusted]PeriodNet savingsflows i19681969197019711972197321972- 1 IIIIIIV1973- 1 IIIII.IV23.9-1.86.226.329.910.210.77.16.35.97.83.6-3.72.51 New deposits less withdrawals. Excludes interest credited.2 Estimate by Council of Economic Advisers.Note.—Thrift institutions consist of mutual savings banks and federally insured savings and loan associations.Sources: National Association of Mutual Savings Banks, and Federal Home Loan Bank Board (except as noted).The Federal National Mortgage Association, the largest financial intermediaryserving mortgage markets, bought $6.1 billion worth of mortgagesduring 1973, an increase of $2.4 billion over 1972.The President announced a series of legislative and administrative proposalsin September 1973 in order to ease the tight mortgage market conditionsexisting at the time. First, the Federal Home Loan Banks were authorizedto make forward commitments up to $2.5 billion at a predeterminedrate of interest to member savings and loan associations. Second, theGovernment National Mortgage Association was authorized to reactivatethe Tandem Plan and offer to buy up to $3 billion of mortgages from varioustypes of financial institutions. Third, Congress was requested to raise themaximum amount of a mortgage loan insurable by the Federal Housing Administration,a step which would make Government-backed loans availableto a larger number of home buyers who cannot obtain conventional mortgageloans. The President also sent to the Gongresss several recommendations designedto make it easier for home buyers to obtain mortgages in the future.87
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ECONOMICTRANSMITTEDTO THE CONGRESSF
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CONTENTSPageECONOMIC REPORT OF THE
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ECONOMIC REPORT OF THE PRESIDENTTo
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of the inflation rate of 1973, and
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or permit incentives—including hi
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people of an easy time. Like our pa
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THE PRESIDENT:LETTER OF TRANSMITTAL
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CHAPTER 3. INFLATION CONTROL UNDER
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Page7. Unemployment Rates by Sex an
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Page53. Maximum Percent Change in E
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We have specific problems, too, asi
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This curtailment of supply does, of
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consumption we would not have chose
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outside the food and fuel sectors a
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about $14 billion from deficit to s
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8 percent, at annual rates. Continu
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A third method, which seems to have
Page 42 and 43: DEVELOPMENT OF LOW-COST ENERGY FOR
Page 44 and 45: would otherwise have been invested
Page 46 and 47: TRANSPORTATION REFORMLast year the
Page 48 and 49: constraints. Restrictions on entry
Page 50 and 51: In early 1974 the Commerce Departme
Page 52 and 53: Consumer SpendingConsumer expenditu
Page 54 and 55: Chart 1Changes in GNP, Real GNP, GN
Page 56 and 57: During the fourth quarter the downt
Page 58 and 59: A number of points may be noted abo
Page 60 and 61: income do not appear to have played
Page 62 and 63: Chart 2Changes in Real GNPPERCENTUN
Page 64 and 65: of essentially declining participat
Page 66 and 67: The unemployment rate for adult mal
Page 68 and 69: from job losers, the remainder of t
Page 70 and 71: to maintain a somewhat larger work
Page 72 and 73: Chart 3Changes in Selected Price Me
Page 74 and 75: TABLE 12.—Changes in selected pri
Page 76 and 77: production workers, and it is sensi
Page 78 and 79: the profits that companies report a
Page 80 and 81: Two measures of changes in income t
Page 82 and 83: About $8 billion of the growth in e
Page 84 and 85: effect of covered wage and employme
Page 86 and 87: Since these apparent stabilization
Page 88 and 89: MONETARY POLICY AND FINANCIAL MARKE
Page 90 and 91: lation requiring ceilings on all CD
Page 94 and 95: CHAPTER 3Inflation Control Under th
Page 96 and 97: (A more detailed presentation of th
Page 98 and 99: ate of advance in grocery store foo
Page 100 and 101: to the economy but also in the sens
Page 102 and 103: were imposed, limiting prices to th
Page 104 and 105: spurring of domestic inflation by e
Page 106 and 107: was more than twice as high in 1973
Page 108 and 109: wage increases in many cases, const
Page 110 and 111: TABLE 26.—Behavior of items in co
Page 112 and 113: Chart 6Changes in RelatedWholesale
Page 114 and 115: and natural gas. A complex set of f
Page 116 and 117: CHAPTER 4Energy and AgricultureFOR
Page 118 and 119: al gas have contributed to the low
Page 120 and 121: TABLE 30*—Wholesale prices, all i
Page 122 and 123: tion sector, which in 1972 accounte
Page 124 and 125: United States on oil imports, OPEC
Page 126 and 127: of old oil and prices of imported a
Page 128 and 129: LONG-TERM PROSPECTSThe price of imp
Page 130 and 131: important that the higher costs be
Page 132 and 133: improving the environment. The fund
Page 134 and 135: pollutants into the atmosphere will
Page 136 and 137: of research and rapid mechanization
Page 138 and 139: lion in fiscal 1972. Actually the a
Page 140 and 141: a minimum income. Unless prices fal
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The Administration supports the exa
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and estimates of some of these effe
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Since families typically pool their
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ability were not perfectly correlat
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Farm wages and farm income received
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TABLE 37.—Average usual weekly ea
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Chart 9Real Incomes for Men in Diff
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ecause they have acquired more expe
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whose owners or white workers have
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Several factors can be mentioned to
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y social pressures, however, which
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TABLE 42.—Relation of wage and sa
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ferences in their mix of occupation
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for public housing may be valued by
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8 to 20 percent for black females.
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sufficiently high to cover the addi
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TABLE 45.—Federal Government tran
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given to the problems of poverty du
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TABLE 47.—Trends in the employmen
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enefit increases greater than the i
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(Table 45). Medicare is chiefly des
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Public assistance is specifically d
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Then, subtracting equation (4) from
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policies, and the tensions among co
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In the fourth quarter the dollar ro
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which include trade, grants and oth
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tarily by foreign central banks, ev
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ply of oil, and by domestic price c
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in the United States. In view of th
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TABLE 52.—U.S. balances on intern
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esult from changes in market value
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TABLE 54.—Major changes in capita
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attempt was made to agree on a code
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The official price of gold was rais
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system, these demand changes were a
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What Pressures Should Be Exerted on
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The composition of reserves among d
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prices of approximately the same or
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tained, they would probably be felt
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Reducing Nontariff BarriersIn order
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Structural problems. Agreements on
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arrangements which are designed to
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capital and the means of putting th
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Canada and four smaller countries u
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currencies have appreciated relativ
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Effective Changes in Other Currenci
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Activities of the Advisory Committe
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Appendix BREPORT TO THE PRESIDENT O
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Report to the President on the Acti
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govern the exploitation of the reso
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Manpower and Social Affairs Committ
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Junior Staff EconomistsJames S. Fac
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Appendix CSTATISTICAL TABLES RELATI
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PRODUCTION AND BUSINESS ACTIVITY:Pa
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NATIONAL INCOME OR EXPENDITURETABLE
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TABLE C-2.—Gross national product
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TABLE C-3.—Implicit price deflato
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Page 263 and 264:
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TABLE C—8.—Gross national produ
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TABLE C-10.—Gross national produc
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TABLE C-12.—Personal consumption
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TABLE C-14.—Relation of gross nat
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TABLE C—16.—Relation of nationa
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TABLE C-18.— Total and per capita
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TABLE C-19.—Sources of personal i
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TABLE C-21.—Saving by individuals
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POPULATION, EMPLOYMENT, WAGES, ANDP
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TABLE C-24.—Noninstitutional popu
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TABLE C-26.— Selected unemploymen
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TABLE C—28.—Unemployment insura
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TABLE C-29.—Wage and salary worke
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TABLE C-31.—.•Average weekly ea
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TABLE C-33.—Changes in output per
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TABLE C—35.—Industrial producti
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TABLE C-37.—Capacity utilization
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TABLE C—38.—New construction ac
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TABLE C-39.—New housing starts an
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TABLE C-41.—Sales and inventories
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TABLE C-43.—Manvjacturers* new an
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TABLE O45.—Consumer price indexes
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TABLE C—47.—Consumer price inde
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TABLE C~49.—Wholesale price index
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TABLE C-50.—Wholesale price index
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194819491950.,1951195219531954Yearo
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TABLE C-53.—Commercial bank loans
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TABLE G-54.—Total funds raised in
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TABLE C-56.—Federal Reserve Bank
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TABLE C-58.—Bond yields and inter
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TABLE C-59.—Short- and intermedia
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TABLE C-61.—Mortgage debt outstan
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TABLE C-63.—Net public and privat
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TABLE C-65.—Federal budget receip
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TABLE C-66.—Relation of the Feder
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TABLE C-68.—Receipts and expendit
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TABLE C-10.—State and local gover
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TABLE C-72.—Estimated ownership o
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CORPORATE PROFITS AND FINANCETABLE
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TABLE C-76.—Relation of profits a
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TABLE C-77.—Sources and uses of f
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TABLE C-79.—State and municipal a
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TABLE C-81.—Business formation an
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Year1929...1933...1939...1940...194
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TABLE C-85.—Indexes of prices rec
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TABLE G-87.—Comparative balance s
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TABLE G-88.— U.S. balance of paym
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TABLE C-90.— U.S. merchandise exp
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TABLE C-92.—International reserve
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TABLE G-94.—International investm
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TABLE C-96.—Consumer price indexe
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ECONOMIC

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