Source stringclasses 1
value | Date int64 1.98k 2.01k | Text stringlengths 2 27.1k | Token_count int64 1 5.57k |
|---|---|---|---|
fomc | 1,977 | Thank you, Mr. Jackson. Mr. Balles now, please. | 15 |
fomc | 1,977 | Mr. Chairman, in some of your earlier testimony, it seems to me, you've done an outstanding job educating Congress as to the change in financial technology that's going on, and why M1, therefore, doesn't mean as much as it used to. And in fact, if adjusted for earlier conditions, [it is] perhaps as much as a couple of ... | 843 |
fomc | 1,977 | Thank you, Mr. Balles. Mr. Partee, please. | 15 |
fomc | 1,977 | Well, Mr. Chairman, I believe I would support the ranges you proposed, recognizing in each case that they're pretty tight. With regard to M1, I'm a little surprised to hear President Balles suggest a reduction in the range, when earlier he commented that the implied velocity increase was extraordinarily large [on the o... | 888 |
fomc | 1,977 | They're very much high. | 5 |
fomc | 1,977 | Well, but with a 5 percent inflation rate, and the desire for real growth [to move] from 6 to 7, it requires quite a sizable number I believe. | 37 |
fomc | 1,977 | The average rate of growth of M3 for the period 1966 to 1975 was 8.8 [percent]. The average for the period 1971 to 1975 was 10.8. The average for 1976 was 12.4. The corresponding figures for M2 are 8.3, 9.5, and 10.9. | 79 |
fomc | 1,977 | And you're suggesting an upper limit of 11-1/2 on the range for M3, and of 10 for M2, which is less than last year's result in both cases. | 39 |
fomc | 1,977 | That's correct. Last year's result was very much out of the ball park. | 15 |
fomc | 1,977 | My point, simply, Mr. Chairman, is that I think the Committee must be aware of the fact that--because we're talking about relationships among the family of aggregates--it's basically projecting interest rates. It may be that, sometime in the year, Regulation Q could give, which would hold the number up. But I hate to p... | 122 |
fomc | 1,977 | Thank you, Mr. Partee. Mr. Baughman now, please. | 17 |
fomc | 1,977 | Mr. Chairman, I've wondered how we're going to handle this situation in the environment that we apparently will be in, and I hadn't been as resourceful as you have been in terms of how it might be handled, because I had tended to think in terms of some change in the top instead of the bottom of the ranges. I'm prepared... | 113 |
fomc | 1,977 | Thank you, Mr. Baughman. Mr. Morris, please. | 15 |
fomc | 1,977 | Mr. Chairman, I guess I'm in a minority position in this, but it seems to me that there are advantages in the present situation of staying with the present ranges. I think you're quite right that we must have a policy of gradually moving down the ranges. But I don't think we ought to get an [unintelligible] policy--to ... | 225 |
fomc | 1,977 | I would only make one comment. There's never a good time. I've learned that from very long and hard experience. Secondly, the next time we turn to this subject will be in April, and the Congress may just have passed the fiscal bills recommended by the President, or be on the point of passing. That isn't going to be an ... | 91 |
fomc | 1,977 | Well, I think you're quite right, Mr. Chairman, but I think that if we were making a change in substance here, and [if] I thought we had the economic case to make it, I think it would be quite different. But to make a change that I don't think is substantive in this climate--I don't think that it makes a lot of sense. | 75 |
fomc | 1,977 | On the fact that there was an overshoot in M2 and M3, I would like to explore this a little. If we were to continue with the same ranges for M2 and M3, we would be doing nothing to correct for that overshoot. In other words, we would be allowing base drift to proceed. Now this is a convenient way of dealing with a past... | 630 |
fomc | 1,977 | Proceeding as we have, Henry, I've made some calculations--it will take us ten years. Ten years if we're lucky, if we don't have any recession, and if we just persist in doing pretty much what we've been doing. | 47 |
fomc | 1,977 | Well, I feel apprehensive about quarterly changes. This one, it seems to me, has a good deal of logic, and I support the reductions in the lower ends of the M2 and M3. So I do not arrive at a different conclusion. But there are some considerations here, I think, that at some time might need to be examined more in depth... | 75 |
fomc | 1,977 | Thank you, Mr. Wallich. Mr. Winn, please. | 14 |
fomc | 1,977 | I'm a little bit of the devil's advocate today. I'd like to refresh our memory as to where we set our target three months ago, when we were faced with a pause. We were concerned about the outlook, and we were not nearly as positive as we are at the moment; yet we took a stand for cutting back at that time in view of ou... | 192 |
fomc | 1,977 | That's a question of short-term targets. | 8 |
fomc | 1,977 | That's correct. | 3 |
fomc | 1,977 | It is a question as to what we mean by targets. | 12 |
fomc | 1,977 | Thank you, Mr. Winn. Mr. Coldwell now, please. | 15 |
fomc | 1,977 | Mr. Chairman, I've been debating this matter in my mind for several days, weeks, months as to where to opt for standstill or some modest lowering of targets, and I agree with you that, if we are going to lower targets, M2, M3 [offer] the better logic than M1. The arguments that I devised in my mind went something like ... | 666 |
fomc | 1,977 | That comment touches one of my nerves. I have made that comment repeatedly with regard to our two-month targets. I've never made it with regard to the long run. | 33 |
fomc | 1,977 | No, I recognize you have not made it for the long run. Nevertheless, M2 and M3 are presently on a 3-point spread. Now, I haven't got any strong feelings about this because I am not much of a short-run believer in these things. But [for] the long run, I have some belief in these figures, and I would like to see if maybe... | 209 |
fomc | 1,977 | Thank you, Mr. Coldwell. Mr. Mayo now, please. | 15 |
fomc | 1,977 | I am quite willing to accept your prescription, Mr. Chairman. I started out going Frank Morris's way--no change. Then I began to worry that, just about the time that we come up for this three months from now--and I feel much surer [now] in my own mind--I wouldn't want to see us make a change [then]. And if we're going ... | 340 |
fomc | 1,977 | All right, thank you, Mr. Mayo. Mr. Gardner now. | 15 |
fomc | 1,977 | I think we've had a kind of good discussion about the prospects of the economy and we have at least a seeming consensus of what is ahead. I once spoke about the fact that it is not necessary to change at every meeting of this Committee. But when I see a road ahead that I generally perceive [as desirable], then I want t... | 123 |
fomc | 1,977 | There is a lot of work done on this which shows that, over 15 years, M2 has been very stable. | 25 |
fomc | 1,977 | Relative to GNP. | 5 |
fomc | 1,977 | Starting around 1961. If you carry it back just a few years, it all collapses. | 21 |
fomc | 1,977 | Well, I have another view of M2, and M3 particularly, and that is that it isn't only [Regulation] Q; it's the technological change in the way transactions are handled, which you are all familiar with--telephone transfer, NOW accounts, and what have you. And I want to get about the business of this overshoot. We have ha... | 340 |
fomc | 1,977 | Thank you, Mr. Gardner. Mr. Guffey now, please. | 16 |
fomc | 1,977 | Yes, Mr. Chairman, in preparing for this meeting and sharing the desire to continue to move downward, I think we came to the judgment that whatever we might do should be principally cosmetic. And we came out, much as you did, to lowering the lower [end of the] range of M2 a half percentage point. We had thought some [a... | 171 |
fomc | 1,977 | All right, just one point: Leaving the upper limit of M3 unchanged should, I think, protect us against that criticism, assuming that criticism is going to be rational, which it sometimes is, and often is not. | 45 |
fomc | 1,977 | Mr. Chairman, I wonder, did the staff do any estimates to see what that M3 would do to housing? Did you project it? | 29 |
fomc | 1,977 | I don't believe [so], Governor Partee. We didn't project for the lower limit. | 18 |
fomc | 1,977 | No, but for the upper limit--M3, well anything. | 14 |
fomc | 1,977 | No, we did not project. Because [M3] includes time and savings deposits at banks, which are going down, I don't believe lowering it a quarter of a point would be offset by additional lending by the Home Loan Banks. So I don't think you're going to get any significant impacts on housing from that minor change. | 65 |
fomc | 1,977 | You know, they've been flooded with money. If they have a problem, they can easily solve it through 1978. | 25 |
fomc | 1,977 | The question that I had in my mind and, I think, that Governor Jackson had in his mind is whether coming down from where we've been recently--not with the upper end of the ranges but where we have been--won't create quite a wrench in housing. And that is a matter of flow of funds projections. | 64 |
fomc | 1,977 | Of course, that's basic to the projection of GNP that we've already presented to you. And that working-down is built into that projection. | 28 |
fomc | 1,977 | So, do you have a rising level of starts with an M3 within the ranges that we're talking about? | 22 |
fomc | 1,977 | Yes, that's right. | 5 |
fomc | 1,977 | Thank you, Mr. Guffey. Mr. Volcker, may we hear from you now. | 21 |
fomc | 1,977 | Just on this latter point, I would think part of the rationale--although I haven't worked the figures through very carefully--is that an awful lot of M3, in effect--certainly in the savings banks--is now going into the corporate bond market rather than in the mortgages. There's quite a lot of slack to be taken up if th... | 722 |
fomc | 1,977 | Thank you, Mr. Volcker. Would anyone else like to be heard? Yes, Mr. Van Nice, please, and welcome to our meeting, Mr. Van Nice. | 36 |
fomc | 1,977 | Thank you very much. Since I haven't been here for 2-1/2 years, I would like to give you a fresh viewpoint, but I am rather disappointed to say that I find, as Mr. Volcker does, that there seems to be a reasonable consensus here this morning, and I share that consensus. I think the Minneapolis view of the economic outl... | 165 |
fomc | 1,977 | Thank you, Mr. Van Nice. Would anyone else like to speak? If not, I do think that we have a rough consensus as to numbers. There is a consensus in another respect, and this goes--I have only one quarrel with your comment, Paul--at one point, you refer to being quite happy. I don't think anybody is quite happy with this... | 275 |
fomc | 1,977 | Chairman Burns Yes Vice Chairman Volcker Yes President Balles Yes President Black Yes Governor Coldwell Yes Governor Gardner Yes Governor Jackson Yes President Kimbrel Yes Governor Lilly Yes Governor Partee Yes | 38 |
fomc | 1,977 | Yes, Mr. Winn. | 6 |
fomc | 1,977 | Could I raise a question? Steve, I got troubled on your Appendix 3 in the Bluebook in terms of your federal funds rate projection. Now, is the failure of that behavior [mean] that higher rates at the moment would indicate a less rapid rise in the future due to the fact that that should be projected out over a couple mo... | 71 |
fomc | 1,977 | Higher rates? | 3 |
fomc | 1,977 | Well, of the federal funds rate? | 8 |
fomc | 1,977 | It would indicate lesser growth in what over the future? | 11 |
fomc | 1,977 | The federal funds rate in the future. See, you've got the high rates currently--raise the rates currently--to get even higher rates at the end of the year. | 34 |
fomc | 1,977 | Oh, well, alternative A pertains to a longer-run growth path for M1 that is higher than the one adopted by the Committee. Alternative C pertains to a longer-run growth path that's lower than the one adopted by the Committee. So alternative A simply permits a more rapid money growth and thus a lower funds rate; and alte... | 89 |
fomc | 1,977 | Okay. | 2 |
fomc | 1,977 | We should look at B as being the projection. | 10 |
fomc | 1,977 | B is the projection that would be consistent with what the Committee has adopted today for the long run. | 20 |
fomc | 1,977 | Any other questions? | 4 |
fomc | 1,977 | Just one brief question of what impressions or facts the staff may have about the prevalence of a reduction in the passbook rate, or savings certificates rates, around the country. | 34 |
fomc | 1,977 | I don't believe we have anything more specific than we presented last time, and it's just scattered reports. You don't have anything beyond that, President Volcker. | 31 |
fomc | 1,977 | Mr. Black, please. | 6 |
fomc | 1,977 | Steve, you may have answered this--I know you have skirted it very closely--but I was a little surprised when I remembered that, back in 1975, when we had that sharp jump in M1 and M2 in May and June, when we had the tax rebate--since we have larger refunds coming this year, we are going to have a rebate too. I would h... | 108 |
fomc | 1,977 | In 1975, the first quarter rate of growth was very small, of course, 0.6 percent, and the second quarter, on average, was 7.4. And we have assumed this year, in our tentative working out of a pattern in the second quarter, that the rebates will move out of demand deposits perhaps faster than they did last time. As you ... | 182 |
fomc | 1,977 | You do have pretty large refunds, don't you? | 10 |
fomc | 1,977 | Well, again, the refunds come, and it depends on the pattern, because what goes in in March goes out in April, and it has a negative effect on the April growth rate. So you might get a high March growth rate and a low April growth rate, [and] a high May growth rate as the rebates come in; if they go out, move into depo... | 105 |
fomc | 1,977 | Thank you, Mr. Black. Mr. Eastburn. | 12 |
fomc | 1,977 | Steve there has been some talk in the market about the uncertainties of seasonals, particularly at this time of the year. Do you have any feelings to whether they are more uncertain now than-- | 38 |
fomc | 1,977 | We hope to have new seasonals by the next Committee meeting. We have held them up, waiting for the June benchmark; we do them both simultaneously. I am absolutely certain, from following past experience, that the weekly seasonals are going to be revised substantially. The large weekly variations that we have seen will ... | 101 |
fomc | 1,977 | Thank you, Mr. Eastburn. Mr. Wallich, please. | 15 |
fomc | 1,977 | Steve, we've chosen for the long-term ranges something close to alternative B. If we were now to choose something like alternative C for the two-month ranges, then, of course, the interest rates path of Appendix 3 will not apply. But there will be something like the usual pattern, which shows that C means a higher fund... | 82 |
fomc | 1,977 | Yes. If you choose the interest rate pattern implicit in alternative C, that is, a higher federal funds rate over the next few weeks, which is about 1/2 point, then our ending point on the funds rate would not be 6-1/2 percent, as it is under alternative B; it would be somewhat lower, on the thought that the Committee ... | 95 |
fomc | 1,977 | Thank you, Mr. Wallich. Mr. Partee, please. | 15 |
fomc | 1,977 | Well, going back to President Black's question, what we can look forward to with some confidence is a bulge, maybe as early as March, with the refunds of 1976 tax payments, certainly in May and June depending on the timing of the rebate. And so it puts us in sort of an odd situation; the January and February numbers ar... | 97 |
fomc | 1,977 | Yes, but I might add that it seems as certain as death and taxes in May and June. The refunds that we are projecting--and we could be off again on that projection of the amount of refund--but if it does turn out to be $3 billion higher, it's likely it will bulge in March. | 64 |
fomc | 1,977 | Thank you, Mr. Axilrod. We have to make a decision as to the procedure. It's 5 minutes to 1:00. And we could continue this meeting and perhaps reach a resolution as to our short-range targets quickly, or we could break for lunch and come back at 2:00. What is the pleasure of the Committee? | 72 |
fomc | 1,977 | I think we ought to break. | 7 |
fomc | 1,977 | The suggestion has been made that we break for lunch; I hear no protest. [Lunch break] | 20 |
fomc | 1,977 | Now we are ready for item 4. Let me give you the housing figure. Here is the way they have been running, to give you a frame of reference: August--1,537,000; September--1,840,000; October--1,814,000; November--1,716,000; December--1,940,000. | 74 |
fomc | 1,977 | Single or multifamily? | 5 |
fomc | 1,977 | Increase in both. Let me give you the multifamily: August--366; September--560; remember there was a sudden increase associated with special activity by HUD; October--477; November--479; December--617. On the other hand, building permits figures show somewhat different results: July 1,215; August 1,296; September 1,504... | 393 |
fomc | 1,977 | That would put them at about alternative C, if you shade them. | 14 |
fomc | 1,977 | That's right. Well, that's the way I see matters for the month ahead. Who'd like to speak on the subject. Let's see if we can't go round the table and do it with reasonable speed. It's now 2:30, and there is a lot that all of us still have to accomplish before this day is over. Mr. Coldwell. | 72 |
fomc | 1,977 | Mr. Chairman, I found myself in the same box you did because the only thing I really have much problem with is the federal funds rate range. I don't have any problem with the alternative B objectives. The federal funds rate range, though, I came out differently than you did. Although not differently in the center point... | 143 |
fomc | 1,977 | All right, thank you, Mr. Coldwell. Mr. Volcker, please. | 18 |
fomc | 1,977 | My feeling about the interest rate range is exactly as you expressed it. I'd be hesitant to see it move from 4-5/8, but [a] 4-3/4 percent midpoint is okay. And I think in practice it should be narrower; however, as far as how we put the thing formally, I can't see what would happen to this market if it went above 5, or... | 277 |
fomc | 1,977 | All right, thank you. Mr. Partee, please. | 13 |
fomc | 1,977 | Oh, excuse me, let me just add [where] this leads me, I guess. | 19 |
fomc | 1,977 | Yes, I was going to ask that. | 9 |
fomc | 1,977 | I was going to live with alternative B--I suppose I would be a little happier, particularly if M2, in the light of our decision this morning, was reduced by 1/2. I think there are some reasons to make it a little higher at the moment, in the long term. | 61 |
fomc | 1,977 | All right. | 3 |
fomc | 1,977 | Well, I don't exactly agree with President Volcker's "straddling" the long-term range. I think a lot of times you got a month, and the two-month average that we know is coming in pretty high or pretty low. And so it becomes just impossible, unless you just disregard it, to have something in that midpoint. This doesn't ... | 537 |
fomc | 1,977 | No-- | 2 |
fomc | 1,977 | That is, well, you'd have to have a high number on both or a low-- | 18 |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.