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Figure 1.

Civilian Unemployment Rate

Monthly

Period	Percent
January 2011	9.1
February 2011	9.0
March 2011	9.0
April 2011	9.1
May 2011	9.0
June 2011	9.1
July 2011	9.0
August 2011	9.0
September 2011	9.0
October 2011	8.8
November 2011	8.6
December 2011	8.5
January 2012	8.3
February 2012	8.3
March 2012	8.2
April 2012	8.2
May 2012	8.2
June 2012	8.2
July 2012	8.2
August 2012	8.1
September 2012	7.8
October 2012	7.8
November 2012	7.7
December 2012	7.9
January 2013	8.0
February 2013	7.7
March 2013	7.5
April 2013	7.6
May 2013	7.5
June 2013	7.5
July 2013	7.3
August 2013	7.2
September 2013	7.2
October 2013	7.2
November 2013	6.9
December 2013	6.7
January 2014	6.6
February 2014	6.7
March 2014	6.7
April 2014	6.3
May 2014	6.3
June 2014	6.1
July 2014	6.2
August 2014	6.2
September 2014	5.9
October 2014	5.7
November 2014	5.8
December 2014	5.6
January 2015	5.7
February 2015	5.5
March 2015	5.5
April 2015	5.4
May 2015	5.5
June 2015	5.3
July 2015	5.2
August 2015	5.1
September 2015	5.0
October 2015	5.0
November 2015	5.0
December 2015	5.0
January 2016	4.9
February 2016	4.9
March 2016	5.0
April 2016	5.0
May 2016	4.7
June 2016	4.9
July 2016	4.9
August 2016	4.9
September 2016	5.0
October 2016	4.9
November 2016	4.6
December 2016	4.7
January 2017	4.8
February 2017	4.7
March 2017	4.5
April 2017	4.4
May 2017	4.3
June 2017	4.3
July 2017	4.3
August 2017	4.4
September 2017	4.2
October 2017	4.1
November 2017	4.1
December 2017	4.1
January 2018	4.1
February 2018	4.1
March 2018	4.1
April 2018	3.9
May 2018	3.8
June 2018	4.0
July 2018	3.9
August 2018	3.9
September 2018	3.7
October 2018	3.7
November 2018	3.7

Source: Bureau of Economic Analysis via Haver Analytics.

Alternative Measures of PCE Inflation

Monthly
Percent

Period	Total	Excluding food and energy	Trimmed mean
January 2011	1.48	1.02	0.99
February 2011	1.79	1.14	1.15
March 2011	2.07	1.16	1.28
April 2011	2.46	1.35	1.41
May 2011	2.75	1.49	1.55
June 2011	2.79	1.58	1.62
July 2011	2.89	1.74	1.70
August 2011	3.00	1.86	1.79
September 2011	3.06	1.88	1.84
October 2011	2.76	1.81	1.93
November 2011	2.77	1.91	2.00
December 2011	2.60	2.06	2.06
January 2012	2.63	2.13	2.10
February 2012	2.58	2.10	2.03
March 2012	2.35	2.11	2.02
April 2012	2.06	2.04	2.00
May 2012	1.63	1.89	1.93
June 2012	1.59	1.88	1.90
July 2012	1.45	1.82	1.85
August 2012	1.54	1.67	1.79
September 2012	1.70	1.72	1.80
October 2012	1.99	1.91	1.78
November 2012	1.72	1.80	1.70
December 2012	1.65	1.71	1.62
January 2013	1.47	1.59	1.58
February 2013	1.60	1.55	1.62
March 2013	1.28	1.48	1.57
April 2013	1.07	1.41	1.43
May 2013	1.25	1.42	1.40
June 2013	1.53	1.49	1.50
July 2013	1.62	1.51	1.55
August 2013	1.43	1.57	1.54
September 2013	1.16	1.55	1.52
October 2013	1.03	1.52	1.53
November 2013	1.25	1.58	1.61
December 2013	1.46	1.63	1.66
January 2014	1.47	1.52	1.63
February 2014	1.14	1.45	1.56
March 2014	1.48	1.58	1.60
April 2014	1.77	1.69	1.76
May 2014	1.85	1.74	1.81
June 2014	1.76	1.69	1.78
July 2014	1.80	1.77	1.81
August 2014	1.63	1.69	1.76
September 2014	1.62	1.71	1.76
October 2014	1.43	1.58	1.74
November 2014	1.23	1.52	1.72
December 2014	0.84	1.46	1.68
January 2015	0.17	1.34	1.58
February 2015	0.27	1.39	1.64
March 2015	0.28	1.35	1.62
April 2015	0.14	1.32	1.63
May 2015	0.24	1.28	1.61
June 2015	0.33	1.30	1.63
July 2015	0.27	1.22	1.61
August 2015	0.30	1.28	1.67
September 2015	0.13	1.29	1.67
October 2015	0.15	1.22	1.62
November 2015	0.31	1.26	1.60
December 2015	0.41	1.25	1.58
January 2016	0.97	1.47	1.69
February 2016	0.75	1.55	1.71
March 2016	0.68	1.48	1.70
April 2016	0.96	1.56	1.71
May 2016	0.89	1.60	1.75
June 2016	0.86	1.58	1.72
July 2016	0.85	1.69	1.75
August 2016	1.00	1.78	1.77
September 2016	1.25	1.72	1.78
October 2016	1.49	1.86	1.88
November 2016	1.46	1.78	1.89
December 2016	1.74	1.85	1.96
January 2017	2.05	1.90	2.02
February 2017	2.18	1.87	1.97
March 2017	1.86	1.64	1.90
April 2017	1.78	1.64	1.86
May 2017	1.61	1.59	1.82
June 2017	1.51	1.62	1.81
July 2017	1.48	1.50	1.74
August 2017	1.54	1.41	1.72
September 2017	1.77	1.48	1.73
October 2017	1.71	1.58	1.73
November 2017	1.87	1.61	1.76
December 2017	1.81	1.64	1.78
January 2018	1.75	1.63	1.79
February 2018	1.85	1.66	1.80
March 2018	2.07	1.96	1.86
April 2018	2.05	1.89	1.84
May 2018	2.25	1.98	1.91
June 2018	2.28	1.95	1.97
July 2018	2.34	2.02	2.02
August 2018	2.19	1.93	2.00
September 2018	1.97	1.94	1.97
October 2018	1.98	1.78	1.91

Note: The data extend through October 2018; changes are from one year earlier.

Source: For trimmed mean, Federal Reserve Bank of Dallas; for all else, Bureau of Economic Analysis via Haver Analytics.

Figure 2. Financial Conditions Indexes

A line chart. The x-axis measures time and ranges from years 1990 to 2018. The y-axis ranges from -3 to 5 standard deviations. The data are weekly. There are two variables plotted on the chart. The first line, labeled "Goldman Sachs," is designated by a red line and ranges from about -2 to 5 standard deviations. This line begins at around 1.75 in 1990, decreases to about zero at the end of 1993, increases rapidly to about 1.5 at the end of 1994, decreases to about -1.75 in the beginning of 2000, increases to about 2.75 in 2002, decreases between 2003 and 2008 to about -0.5, increases sharply to about 4.75 from 2008 to the beginning of 2009, declines sharply to about 0.25 at the end of 2009, declines to about -1.5 in 2014, increases to about 0.5 at the end of 2015, decreases to about -1.25 from 2016 to the end of 2017, and increases to end at about -0.5. The second line, labeled "Federal Reserve Bank of Chicago," is designated by a solid black line and ranges from about -1 to 2 standard deviations. This line begins at about zero in 1990, increases to about 0.25 at the end of 1990, decreases to about -0.75 between 1991 and mid-1998, increases to about zero at the end of 1998, gradually declines to about -0.75 in 2007, rapidly increases from mid-2007 through the end of 2008 to about 2.5, decreases sharply to about zero from the end of 2008 to the beginning of 2010, and then decreases more gradually to end at about -0.75.

Note: The indexes are standardized; values above (below) zero represent tighter (easier) than average financial conditions. The shaded bars indicate periods of business recession as defined by the National Bureau of Economic Research: July 1990-March 1991, March 2001-November 2001, and December 2007-June 2009. The Goldman Sachs FCI is a weighted average of five financial variables (the federal funds rate, the 10-year Treasury yield, the corporate BBB Treasury yields spread, the S&P price-to-earnings ratio, and the broad value of the U.S. dollar), with weights chosen based on the effects of these variables on real GDP growth using a VAR model. The Chicago NFCI is based on 100 financial variables spanning three market segments: money market, debt and equity market, and the banking sector. The Chicago NFCI is weekly and is derived using a dynamic factor model, which optimally weights each variable by taking into account both the cross-correlations of the variables in the index and the historical evolution of the index itself.

Source: Bloomberg Finance LP; Federal Reserve Bank of Chicago, Chicago Fed National Financial Conditions Index [NFCI], retrieved from FRED, Federal Reserve Bank of St. Louis; https://fred.stlouisfed.org/series/NFCI.

Figure 3. Household-Sector Credit-to-GDP Ratio

Quarterly

Period	Ratio
1980:Q1	0.4798
1980:Q2	0.4833
1980:Q3	0.4836
1980:Q4	0.4757
1981:Q1	0.4617
1981:Q2	0.4664
1981:Q3	0.4597
1981:Q4	0.4653
1982:Q1	0.4719
1982:Q2	0.4695
1982:Q3	0.4656
1982:Q4	0.4696
1983:Q1	0.4630
1983:Q2	0.4617
1983:Q3	0.4610
1983:Q4	0.4637
1984:Q1	0.4640
1984:Q2	0.4664
1984:Q3	0.4690
1984:Q4	0.4767
1985:Q1	0.4914
1985:Q2	0.4989
1985:Q3	0.5069
1985:Q4	0.5242
1986:Q1	0.5288
1986:Q2	0.5360
1986:Q3	0.5456
1986:Q4	0.5566
1987:Q1	0.5562
1987:Q2	0.5632
1987:Q3	0.5680
1987:Q4	0.5595
1988:Q1	0.5672
1988:Q2	0.5685
1988:Q3	0.5718
1988:Q4	0.5712
1989:Q1	0.5713
1989:Q2	0.5742
1989:Q3	0.5784
1989:Q4	0.5856
1990:Q1	0.5890
1990:Q2	0.5907
1990:Q3	0.5938
1990:Q4	0.6035
1991:Q1	0.6097
1991:Q2	0.6097
1991:Q3	0.6069
1991:Q4	0.6117
1992:Q1	0.6103
1992:Q2	0.6059
1992:Q3	0.6049
1992:Q4	0.6034
1993:Q1	0.6052
1993:Q2	0.6070
1993:Q3	0.6108
1993:Q4	0.6100
1994:Q1	0.6113
1994:Q2	0.6109
1994:Q3	0.6136
1994:Q4	0.6169
1995:Q1	0.6210
1995:Q2	0.6269
1995:Q3	0.6307
1995:Q4	0.6327
1996:Q1	0.6404
1996:Q2	0.6385
1996:Q3	0.6394
1996:Q4	0.6389
1997:Q1	0.6414
1997:Q2	0.6393
1997:Q3	0.6399
1997:Q4	0.6414
1998:Q1	0.6465
1998:Q2	0.6528
1998:Q3	0.6519
1998:Q4	0.6539
1999:Q1	0.6603
1999:Q2	0.6677
1999:Q3	0.6709
1999:Q4	0.6712
2000:Q1	0.6828
2000:Q2	0.6793
2000:Q3	0.6904
2000:Q4	0.6935
2001:Q1	0.7019
2001:Q2	0.7101
2001:Q3	0.7331
2001:Q4	0.7375
2002:Q1	0.7463
2002:Q2	0.7528
2002:Q3	0.7638
2002:Q4	0.7792
2003:Q1	0.7916
2003:Q2	0.8142
2003:Q3	0.8172
2003:Q4	0.8250
2004:Q1	0.8355
2004:Q2	0.8465
2004:Q3	0.8539
2004:Q4	0.8672
2005:Q1	0.8701
2005:Q2	0.8852
2005:Q3	0.8934
2005:Q4	0.9026
2006:Q1	0.9136
2006:Q2	0.9286
2006:Q3	0.9417
2006:Q4	0.9488
2007:Q1	0.9519
2007:Q2	0.9620
2007:Q3	0.9673
2007:Q4	0.9713
2008:Q1	0.9845
2008:Q2	0.9702
2008:Q3	0.9765
2008:Q4	0.9717
2009:Q1	0.9782
2009:Q2	0.9792
2009:Q3	0.9725
2009:Q4	0.9560
2010:Q1	0.9444
2010:Q2	0.9281
2010:Q3	0.9135
2010:Q4	0.9013
2011:Q1	0.8993
2011:Q2	0.8838
2011:Q3	0.8727
2011:Q4	0.8602
2012:Q1	0.8488
2012:Q2	0.8396
2012:Q3	0.8344
2012:Q4	0.8310
2013:Q1	0.8218
2013:Q2	0.8186
2013:Q3	0.8108
2013:Q4	0.8036
2014:Q1	0.8041
2014:Q2	0.7959
2014:Q3	0.7861
2014:Q4	0.7839
2015:Q1	0.7806
2015:Q2	0.7763
2015:Q3	0.7728
2015:Q4	0.7721
2016:Q1	0.7737
2016:Q2	0.7708
2016:Q3	0.7724
2016:Q4	0.7697
2017:Q1	0.7686
2017:Q2	0.7684
2017:Q3	0.7643
2017:Q4	0.7643
2018:Q1	0.7621
2018:Q2	0.7535

Note: The shaded bars indicate periods of business recession as defined by the National Bureau of Economic Research: January 1980-July 1980, July 1981-November 1982, July 1990-March 1991, March 2001-November 2001, and December 2007-June 2009. GDP is gross domestic product.

Source: Federal Reserve Board staff calculations based on Bureau of Economic Analysis, national income and product accounts, and Federal Reserve Board, Statistical Release Z.1, "Financial Accounts of the United States."

Figure 4. Common Equity Tier 1 Ratio of Banks

A line chart. The x-axis measures time and ranges from years 2001 to 2018. The y-axis ranges from 0 to 14. Unit is percent of risk-weighted assets. The data are quarterly. There are two variables plotted on the chart. The first line, labeled "Other BHCs," is designated by a solid red line and ranges from 8 to just over 12. This variable decreases slightly over 2001 to 2008 from 10 to 8, increases rapidly from 8 in 2009 to 12 in 2012, and has remained near 12 through 2018:Q2. The second line, labeled "Large BHCs," is designated by a solid black line and ranges from about 5 to 12. This variable increases slowly from about 6 in 2001 to nearly 8 in 2006, decreases sharply to 5 in 2008, and increases rapidly to just below 12 through the end of 2013, where it has remained through 2018:Q2.

Note: The data are seasonally adjusted by Board staff. Sample includes banks as of 2018:Q2. Before 2014:Q1, the numerator of the common equity Tier 1 ratio is Tier 1 common capital for advanced-approaches bank holding companies (BHCs) (before 2015:Q1, for non-advanced-approaches BHCs). Afterward, the numerator is common equity Tier 1 capital. Large BHCs are those with greater than $50 billion in total assets. The denominator is risk-weighted assets. The shaded bars indicate periods of business recession as defined by the National Bureau of Economic Research: March 2001-November 2001, and December 2007-June 2009.

Source: Federal Reserve Board, Form FR Y-9C, Consolidated Financial Statements for Holding Companies.

Figure 5. Domestic Money Market Fund Assets

A stacked line chart. The x-axis measures time and ranges from the years 2000 to 2018. The y-axis is in billions of dollars (real) and ranges from 0 to 4,000 in increments of 500. The data are monthly. There are shaded areas in this chart. The bottom area, represented in red, is institutional prime fund assets. The institutional prime curve begins at about 300 in early 2000, increases to about 700 by late 2002, decreases to about 500 by mid-2005, increases to about 1200 by mid-2008, dips by late 2008 and remains in a range of about 800 to 1000 until 2016, decreases to about 100 by late 2016, and increases to end at about 200 in September 2018. The area above the institutional prime region is light orange and represents retail prime fund assets. The curve begins at about 750 in early 2000, increases to about 1200 by late 2002, decreases to about 950 by mid-2005, increases to about 1800 by mid-2008, dips to about 1500 by late 2008, increases to about 1650 by mid-2009, decreases to about 1400 by late 2015, decreases to about 350 by late 2016, and increases to end at about 500 in September 2018. The third shaded region from the bottom is light blue and represents tax-exempt fund assets. The curve begins at about 900 in early 2000, increases to about 1300 by late 2002, decreases to about 1200 by mid-2005, increases to about 2300 by mid-2008, dips to about 1900 by late 2008, increases to about 2000 by mid-2009, decreases to about 1600 by late 2015, decreases to about 500 by late 2016, and increases to end at about 650 in September 2018. The top shaded area is dark blue and represents government-only fund assets. The curve begins at about 1100 in early 2000, increases to about 1700 by late 2002, decreases to about 1500 by mid-2005, increases to about 3300 by early 2009, decreases to about 2450 by mid-2010, remains near that level until mid-2015, and increases to end at about 2900 in September 2018.

Note: The data are converted to constant 2018 dollars using the consumer price index. Key identifies regions in order from top to bottom.

Source: Federal Reserve Board staff calculations based on Investment Company Institute data; Bureau of Labor Statistics, consumer price index via Haver Analytics.

Figure 6. Business-Sector Credit-to-GDP Ratio

Quarterly

Period	Ratio
1980:Q1	0.4959
1980:Q2	0.5020
1980:Q3	0.5011
1980:Q4	0.4939
1981:Q1	0.4830
1981:Q2	0.4953
1981:Q3	0.4961
1981:Q4	0.5055
1982:Q1	0.5192
1982:Q2	0.5241
1982:Q3	0.5317
1982:Q4	0.5312
1983:Q1	0.5349
1983:Q2	0.5299
1983:Q3	0.5274
1983:Q4	0.5261
1984:Q1	0.5301
1984:Q2	0.5384
1984:Q3	0.5473
1984:Q4	0.5594
1985:Q1	0.5621
1985:Q2	0.5690
1985:Q3	0.5700
1985:Q4	0.5787
1986:Q1	0.5848
1986:Q2	0.5960
1986:Q3	0.6044
1986:Q4	0.6151
1987:Q1	0.6200
1987:Q2	0.6198
1987:Q3	0.6232
1987:Q4	0.6210
1988:Q1	0.6268
1988:Q2	0.6276
1988:Q3	0.6290
1988:Q4	0.6310
1989:Q1	0.6303
1989:Q2	0.6317
1989:Q3	0.6295
1989:Q4	0.6343
1990:Q1	0.6299
1990:Q2	0.6264
1990:Q3	0.6250
1990:Q4	0.6288
1991:Q1	0.6218
1991:Q2	0.6125
1991:Q3	0.5997
1991:Q4	0.5888
1992:Q1	0.5800
1992:Q2	0.5693
1992:Q3	0.5612
1992:Q4	0.5509
1993:Q1	0.5494
1993:Q2	0.5480
1993:Q3	0.5474
1993:Q4	0.5426
1994:Q1	0.5434
1994:Q2	0.5399
1994:Q3	0.5407
1994:Q4	0.5389
1995:Q1	0.5433
1995:Q2	0.5489
1995:Q3	0.5477
1995:Q4	0.5493
1996:Q1	0.5485
1996:Q2	0.5463
1996:Q3	0.5473
1996:Q4	0.5436
1997:Q1	0.5458
1997:Q2	0.5464
1997:Q3	0.5514
1997:Q4	0.5555
1998:Q1	0.5652
1998:Q2	0.5757
1998:Q3	0.5804
1998:Q4	0.5840
1999:Q1	0.5937
1999:Q2	0.5982
1999:Q3	0.6098
1999:Q4	0.6089
2000:Q1	0.6192
2000:Q2	0.6208
2000:Q3	0.6265
2000:Q4	0.6302
2001:Q1	0.6325
2001:Q2	0.6352
2001:Q3	0.6422
2001:Q4	0.6447
2002:Q1	0.6423
2002:Q2	0.6389
2002:Q3	0.6356
2002:Q4	0.6350
2003:Q1	0.6311
2003:Q2	0.6245
2003:Q3	0.6151
2003:Q4	0.6042
2004:Q1	0.6093
2004:Q2	0.6041
2004:Q3	0.6048
2004:Q4	0.6032
2005:Q1	0.6031
2005:Q2	0.6072
2005:Q3	0.6067
2005:Q4	0.6121
2006:Q1	0.6155
2006:Q2	0.6237
2006:Q3	0.6284
2006:Q4	0.6395
2007:Q1	0.6493
2007:Q2	0.6622
2007:Q3	0.6765
2007:Q4	0.6882
2008:Q1	0.7037
2008:Q2	0.7098
2008:Q3	0.7180
2008:Q4	0.7328
2009:Q1	0.7361
2009:Q2	0.7322
2009:Q3	0.7193
2009:Q4	0.6940
2010:Q1	0.6883
2010:Q2	0.6736
2010:Q3	0.6701
2010:Q4	0.6567
2011:Q1	0.6561
2011:Q2	0.6517
2011:Q3	0.6530
2011:Q4	0.6499
2012:Q1	0.6460
2012:Q2	0.6461
2012:Q3	0.6520
2012:Q4	0.6583
2013:Q1	0.6558
2013:Q2	0.6605
2013:Q3	0.6627
2013:Q4	0.6587
2014:Q1	0.6679
2014:Q2	0.6642
2014:Q3	0.6636
2014:Q4	0.6705
2015:Q1	0.6786
2015:Q2	0.6831
2015:Q3	0.6879
2015:Q4	0.6958
2016:Q1	0.7094
2016:Q2	0.7080
2016:Q3	0.7127
2016:Q4	0.7117
2017:Q1	0.7175
2017:Q2	0.7204
2017:Q3	0.7212
2017:Q4	0.7202
2018:Q1	0.7184
2018:Q2	0.7246

Figure 7. Gross Balance Sheet Leverage of Public Nonfinancial Corporations

Quarterly
Percent

Period	All firms	Risky firms
1999:Q1	31.08	39.64
1999:Q2	30.85	39.38
1999:Q3	30.72	38.62
1999:Q4	30.72	38.38
2000:Q1	30.64	37.97
2000:Q2	29.85	37.32
2000:Q3	29.30	36.27
2000:Q4	29.52	36.82
2001:Q1	29.53	38.24
2001:Q2	29.66	39.03
2001:Q3	29.65	38.18
2001:Q4	30.32	39.25
2002:Q1	30.94	39.51
2002:Q2	30.02	37.98
2002:Q3	29.81	37.86
2002:Q4	29.57	37.93
2003:Q1	29.24	37.79
2003:Q2	28.42	37.68
2003:Q3	28.05	36.73
2003:Q4	27.08	36.52
2004:Q1	26.55	35.35
2004:Q2	25.94	34.86
2004:Q3	25.63	35.02
2004:Q4	25.41	34.22
2005:Q1	25.16	34.17
2005:Q2	25.02	32.65
2005:Q3	24.28	31.48
2005:Q4	24.35	32.21
2006:Q1	24.82	33.08
2006:Q2	24.66	32.82
2006:Q3	24.63	33.06
2006:Q4	24.91	34.52
2007:Q1	25.19	35.12
2007:Q2	25.45	34.74
2007:Q3	25.86	35.52
2007:Q4	26.16	35.84
2008:Q1	26.41	36.49
2008:Q2	26.53	36.23
2008:Q3	27.56	38.45
2008:Q4	29.15	40.50
2009:Q1	29.37	40.72
2009:Q2	28.35	38.84
2009:Q3	27.38	36.94
2009:Q4	27.13	37.63
2010:Q1	26.73	36.54
2010:Q2	26.60	36.53
2010:Q3	26.57	36.66
2010:Q4	26.33	36.20
2011:Q1	26.12	36.08
2011:Q2	26.19	36.14
2011:Q3	26.51	36.07
2011:Q4	26.40	35.48
2012:Q1	26.34	35.92
2012:Q2	26.90	36.75
2012:Q3	27.03	36.96
2012:Q4	27.33	37.86
2013:Q1	27.28	37.60
2013:Q2	27.72	38.28
2013:Q3	27.98	38.25
2013:Q4	28.19	38.71
2014:Q1	28.82	39.28
2014:Q2	28.61	38.18
2014:Q3	28.75	38.08
2014:Q4	29.30	38.99
2015:Q1	30.17	39.63
2015:Q2	30.70	39.73
2015:Q3	31.23	41.02
2015:Q4	32.16	40.55
2016:Q1	32.77	42.18
2016:Q2	32.96	41.78
2016:Q3	33.04	41.62
2016:Q4	33.00	40.98
2017:Q1	33.22	40.79
2017:Q2	33.61	41.72
2017:Q3	33.42	41.90
2017:Q4	33.26	41.16
2018:Q1	33.34	40.80
2018:Q2	33.27	41.16

Note: Gross leverage is the ratio of the book value of total debt to the book value of total assets. The sample of risky firms is composed of firms with positive short-term or long-term debt that either have an S&P firm rating of speculative-grade or have no S&P rating. The shaded bars indicate periods of business recession as defined by the National Bureau of Economic Research: March 2001-November 2001, and December 2007-June 2009.

Source: Federal Reserve Board staff calculations based on S&P Global, Compustat.

Figure 8. Distribution of Large Institutional Leveraged Loan Volumes, by Debt-to-EBITDA Ratio

Annual
Percent

Period	Debt multiples ≤ 4x	Debt multiples 4x-4.99x	Debt multiples 5x-5.99x	Debt multiples ≥ 6x
2001	61.1	26.2	10.1	2.7
2002	54.6	27.3	12.2	5.9
2003	52.6	29.3	11.5	6.7
2004	45.0	28.6	17.6	8.8
2005	41.8	25.1	25.1	8.0
2006	36.4	26.3	21.1	16.3
2007	31.2	23.7	17.5	27.7
2008	63.1	14.2	12.1	10.7
2009	53.1	17.7	11.5	17.7
2010	53.7	22.6	17.9	5.8
2011	43.8	22.6	19.2	14.4
2012	35.9	26.6	21.8	15.8
2013	31.5	29.0	23.1	16.4
2014	28.7	22.6	21.5	27.2
2015	29.9	24.8	26.5	18.9
2016	22.0	32.3	24.7	21.0
2017	22.4	28.2	27.7	21.7
2018:Q1	23.0	23.0	29.0	25.2
2018:Q2	26.2	24.0	24.0	25.7
2018:Q3	13.4	20.6	32.0	34.0

Note: The data for 2018 are quarterly. Volumes are for large corporations with earnings before interest, taxes, depreciation, and amortization (EBITDA) greater than $50 million and exclude existing tranches of add-ons and amendments and restatements with no new money. Data may not sum to totals due to rounding. Key identifies bar segments in order from bottom to top.

Source: S&P Global, Leveraged Commentary & Data.

Figure 9. Large Bank Lending to Nonbank Financial Firms: Committed Amounts

A stacked line chart. The x-axis measures time and ranges from years 2013 to 2018. The y-axis measures billions of dollars and ranges from 0 to 1200. The data are quarterly. There are eight variables charted on the plot, which sum up to represent total committed amounts extended to nonbank financials by large banks. The overall trend has been steadily increasing from about 600 in 2013 to about 1000 in 2018:Q2. The first variable, "Other financial vehicles," is designated by black shading. This variable remains fairly constant from 2013:Q1 to 2015:Q2 at about 200 but begins to increase at a steady rate thereafter, reaching about 400 in 2018:Q2. The second variable, "Financial planning and pension funds," is designated by gray shading. This variable increases from about 30 in 2013:Q1 to about 40 in 2014:Q3, then begins to increase steadily to about 50 in 2018:Q2. The third variable, "Open-end investment funds," is designated by green shading. This variable increases steadily from about 70 in 2013:Q1 to about 120 in 2018:Q2. The fourth variable, "Insurance," is designated by purple shading. This variable remains constant through 2015:Q2 at about 90, increases sharply in 2015:Q3 to about 110, decreases to about 100 in 2016:Q2, increases to about 120 in 2016:Q4, falls to about 100 in 2017:Q2, and increases through 2018:Q1 to about 140 before falling to about 125 in 2018:Q2. The fifth variable, "Broker-dealers," is designated by light blue shading. This variable increases steadily from about 70 in 2013:Q1 to about 110 in 2015:Q3, and remains near 100 through 2018:Q2. The sixth variable, "Other lenders," is designated by red shading. This variable has remained near 35 through 2018:Q2. The seventh variable, "Real estate lenders," is designated by beige shading. This variable has increased steadily from about 20 in 2013:Q1 to nearly 50 in 2018:Q2. The eighth variable, "Consumer lenders," is designated by dark blue shading. This variable increased slightly from near 60 in 2013:Q1 to about 75 in 2015:Q4, before falling to about 70 in 2016:Q2, and increases to about 90 in 2017:Q4, where it has remained through 2018:Q2.

Note: Committed amounts on credit lines and term loans extended to nonbank financial firms by a balanced panel of 25 bank holding companies that have filed Form FR Y-14Q in every quarter since 2012:Q3. Nonbank financial firms are identified based on reported NAICS (North American Industry Classification System) codes, excluding other domestic and foreign banks, monetary authorities, and credit unions. Broker-dealers also include commodity contracts dealing and brokerages and other securities and commodity exchanges. Other financial vehicles include closed-end investment and mutual funds, real estate investment trusts, special purpose vehicles, and other vehicles.

Source: Federal Reserve Board, Form FR Y-14Q, Capital Assessments and Stress Testing.

Figure 10. Summary Measure of Valuations Pressures and Risk Appetite

Quarterly

Period	Percentile
1993:Q4	73.82
1994:Q1	79.68
1994:Q2	67.68
1994:Q3	70.83
1994:Q4	55.75
1995:Q1	65.30
1995:Q2	59.61
1995:Q3	51.35
1995:Q4	50.22
1996:Q1	58.36
1996:Q2	62.34
1996:Q3	64.00
1996:Q4	69.34
1997:Q1	76.65
1997:Q2	81.86
1997:Q3	74.93
1997:Q4	66.26
1998:Q1	83.17
1998:Q2	72.98
1998:Q3	29.96
1998:Q4	34.21
1999:Q1	48.88
1999:Q2	55.02
1999:Q3	53.98
1999:Q4	53.51
2000:Q1	48.92
2000:Q2	34.42
2000:Q3	43.32
2000:Q4	26.84
2001:Q1	24.15
2001:Q2	27.16
2001:Q3	21.23
2001:Q4	23.00
2002:Q1	34.75
2002:Q2	32.49
2002:Q3	14.79
2002:Q4	18.74
2003:Q1	32.78
2003:Q2	48.70
2003:Q3	67.97
2003:Q4	80.86
2004:Q1	89.38
2004:Q2	88.54
2004:Q3	88.36
2004:Q4	93.96
2005:Q1	94.37
2005:Q2	83.77
2005:Q3	84.18
2005:Q4	80.71
2006:Q1	89.00
2006:Q2	86.28
2006:Q3	69.81
2006:Q4	80.55
2007:Q1	82.31
2007:Q2	83.70
2007:Q3	36.77
2007:Q4	20.33
2008:Q1	6.85
2008:Q2	8.21
2008:Q3	4.18
2008:Q4	2.35
2009:Q1	2.80
2009:Q2	5.08
2009:Q3	8.27
2009:Q4	12.72
2010:Q1	19.68
2010:Q2	15.96
2010:Q3	12.51
2010:Q4	18.92
2011:Q1	26.56
2011:Q2	26.31
2011:Q3	9.11
2011:Q4	8.11
2012:Q1	17.47
2012:Q2	14.61
2012:Q3	19.08
2012:Q4	23.63
2013:Q1	36.70
2013:Q2	39.91
2013:Q3	39.70
2013:Q4	45.63
2014:Q1	50.06
2014:Q2	60.73
2014:Q3	56.58
2014:Q4	48.82
2015:Q1	55.69
2015:Q2	65.17
2015:Q3	42.23
2015:Q4	40.97
2016:Q1	28.06
2016:Q2	36.58
2016:Q3	47.70
2016:Q4	57.75
2017:Q1	72.69
2017:Q2	77.23
2017:Q3	81.09
2017:Q4	85.47
2018:Q1	90.69
2018:Q2	94.10
2018:Q3 (e)	92.23

Note: The indicator plotted is an aggregate of valuation measures from equity, housing, corporate debt, and commercial real estate markets and of indicators of standards or risk characteristics in these markets. The values are percentiles of the historical distribution for this composite over the time period shown. Data for the third quarter of 2018 are estimates (e). Shaded bars indicate periods of recession as defined by the National Bureau of Economic Research: March 2001-November 2001, and December 2007-June 2009.

Source: David Aikman, Michael T. Kiley, Seung Jung Lee, Michael G. Palumbo, and Missaka N. Warusawitharana (2015) "Mapping Heat in the U.S. Financial System," Finance and Economics Discussion Series 2015-059 (Washington: Board of Governors of the Federal Reserve System, June), http://dx.doi.org/10.17016/FEDS.2015.059.

Last Update: December 07, 2018