January 26, 1960 FOMC Minutes

FOMC minutes

The Chairman commented that this was not a vital matter but he thought it would make some sense to split the subscription. Mr . Mills commented that this would have the advantage, also, of showing variation in the System's thinking. This time the System would be moving out on the longer side, while on other occasions it had moved from long to short. Mr. Mills then moved that a splitting of the subscription in the manner suggested by Chairman Martin be approved, and Mr. Johns seconded the motion. Thereupon, the motion was put to a vote and was approved unanimously. that the next meeting of the Federal Open It was agreed Market Committee would be held on Tuesday, February 9, 1960, at 10:00 a.m. The meeting then adjourned.

Effective Reserves Correction of seasonal factors made: January 1, 1960 of daily figures) (Monthly averages Janur 11yli op doll, T Po P o a: Fes rve s urplus *655 milln 1a.5 V, Ses oflly Adjusted 19 Reserves Reserve surplus I $490 million ReserveI 3 defcit D M J 3 D N J $474 illln Each square - $25 mi.llon r%'t-Reserves Without 'iI- Straitht Line Trend Saonal Adjtent !!o (4last squares method) ~l$ s (.6g per year) Surplus in seas. adJ. reserves from trend 4609 millonen Deebear 1959 . Milliaas of dollars SReserve deficit. $406 milion Re8s.erves7: adJusted 18.55 Seasonally adjusted 18,7 January 1960 l9 9s lreast 19& 19 n195sd Lin e 18,760 .LLIe. ---c . - - . r a - per year or $45 mflion per month. n arnnal froth Of 3.6 percent Trend line exnbitsn Last month plotted: Desember 1959 n deaoolbed on reverse Side. method o computati

Reserve figures are total member bank reserves (monthly averages of daily figures) adjusted for changes in reserve requirements and for seasonal influences. No effort was made to remove the expansion potential of total reserves resulting from shifts in deposits among classes of banks and between types of deposits subject to different requirements through April 1958. Method of computation: For May 1958-December 1959, figures used are actual member bank reserves, adjusted for seasonal influences. Monthly values of effective reserves for January 1947 through April 1958 (when reserve requirements were last changed) have been derived by (1) obtaining the ratio of average required reserves to average deposits subject to legal reserves for May 1958-April 1959; (2) multiplying actual reserves by the percentage is of the ratio of required reserves to deposits subject the above ratio to legal reserves for each specified month; and (3) adjusting the values for seasonal influences. Trend based on monthly values January 1947 through August 1959.

_ Alternate Growth Rates of Effective Reserves (Seas. Adj.) Reserve Levels (Seas. Adj.) Using Actual Fpr August 1958, June 1959, and December 1959 as Starting Points 1/ lions of dollars a o Sillion ~ ~- Era l& ~ rr-u7 i f I:i tIrii diil 11 _ 71f 4i ..ITJi f T trl -1LL 4_4 _44 ?j T t, H-" - t4*ti It h4 r I I f4 LL~- ~~L~~_I ~.~ LL~ ' LYI ~ ' '"' _T ft irs.o xB.o WT 1W,. -1 -1I I I I I I I fI I H tI'i1 Mi ~Stj l Ii H ir L.- 4 ~ +~ ii iI ~LLL~i1 I ri t 11 1l l r 1 I i 11r I1I1 L II ' i L9.01J mm LI ALL.J..LLL.i..L4.j..j~..-...- - f i 1. 1 1 -. - HHHt-tRfst~ [Wi T A ±LLLL- i _- 4 .+, . 4 t iS. - -4-4- 4-4-t- -4-4-4--+-+-- +- V Mtfl ~iErf 1-1~ I- t n 0r IFhdt- tor -Ii r J- -f-t- r LJ8jl'm : A U r r I i I I I i _11- '~ I I--~---- -~-~-