^{note (1) page 4} See Economic Trends, October 1968, pages x-xi.

^{note (2) page 4} See below, pages 16—19.

^{note (1) page 5} On seasonally adjusted data, the rise in registrations was 20 per cent.

^{note (1) page 6} Board of Trade Journal, 18 October 1968, page 1063.

^{note (1) page 7} Comparison of the terminal rates of growth (measured from the fourth quarter of one year to the fourth quarter of the next) gives much higher growth for 1968/7 than for 1969/8 (table 1). This is due to the exceptionally high level of private industrial investment forecast for the last quarter of 1968. The recovery of investment from the depressed levels of the first half year is expected already to have begun by then, and there is the additional factor of the withdrawal by the end of the period of the special bonus on investment grants.

^{note (1) page 8} The initial forecast, derived in the manner described from considering the movement in elements of demand, was also checked by applying disaggregated relationships to give predictions for components of the total volume of imports. Both methods of forecasting imports were described in I. G. Black, J. E. Kidgell and G. F. Ray, ‘Forecasting imports : a re-examination’ in the National Institute Economic Review no. 42, November 1967.

^{note (2) page 8} There is no evidence, in the aggregate stock figures, of an excessive position having been built up in total stocks as a result of any such hedging activity. Indeed, stock positions in aggregate appear to be rather low.

^{note (3) page 8} These figures may be compared with those in earlier forecasts, including that of the Treasury, which was given in the Financial Statement 1968-69, 19 March 1968, page 38. In index number form (second half 1967=100), these forecasts gave estimates of consumers' expenditure, at 1958 prices, for the first and second halves, respectively, of 1968 as follows : Treasury, 99.6 and 98.1; NIESR (May), 100.9 and 98.2; NIESR (August), 101.7 and 98.6; and NIESR (November), 100.8 and 99.8.

^{note (1) page 9} Even had there been no advance at all in the volume of real disposable funds between the second and third quarters, but merely a drop from the very high savings ratio of 8.8 to a more normal one of, say, 7.8, there would have been an increase in consumption expenditure of more than £50 million, at 1958 prices.

^{note (2) page 9} J. Revell : The Wealth of the Nation. Cambridge U.P., 1967, page 147, table 1.

^{note (1) page 11} Long-run analysis of the relationship between changes in stock market prices and consumption does not yield unam biguous answers, since generally advancing share prices and increased dividend incomes are nearly synchronous and it is difficult to identify separate effects. A study of American data by J. Arena gave rather negative results : ‘Postwar Stock Market Changes and Consumer Spending’, The Review of Economics and Statistics, November 1965, Harvard U.P.

^{note (2) page 11} The new official series for the money supply is only available from 1964, which limits comparison. The much slower and steadier rate of expansion shown in the alternative series reflects in part the exclusion of the demand liabilities of institutions such as overseas banks and accepting houses which have exhibited particularly fast growth relative to the system of Clearing and Scottish banks in recent years.

^{note (3) page 11} These restrictions are tentatively thought of as reducing real consumer demand in the first quarter of 1969 by some £30 million at 1958 prices, the maximum direct effect they seem likely to have. They are regarded as being somewhat similar in scale of effect to the hire purchase measures of July 1966.

^{note (1) page 12} In table 1, the former practice of smoothing this series has been dropped to permit more ready comparability with the official figures. The differences between the smoothed and unsmoothed data were, however, very small.

^{note (2) page 12} The conceptually more appropriate total of employees in employment ‘is a series only available quarterly and with a long lag—the latest available figure now is that for March of this year. The movement of the total in relation to unemploy ment in 1967, and up to March 1968, displays similar characteristics to that of the series shown in the chart.

^{note (1) page 13} Compare National Institute Economic Review no. 45, August 1968, page 10, especially footnote (2).

^{note (2) page 13} It looks as though the explanation must involve some thing more than a finding that there has been a change in underlying seasonal patterns of unemployment, resulting in the existing seasonal adjustment factors giving faulty readings. It is hard to conceive of there being major changes in the seasonal pattern of unemployment which would not reflect equally major changes in the seasonal character of employment. The suggestion given by the series shown in the bottom panel of chart 6, that the seasonal adjustments have been over compensating for the true seasonality of unemployment, is thus rather stronger at first sight than it appears upon reflection.

^{note (1) page 14} In August, we commented that up to the second quarter, the expected devaluation effects had still not come in, and we were then inclined to think that perhaps the full effect would be less than expected. National Institute Economic Review no. 45, August 1968, pages 13-14. The third quarter increases, however, seem to suggest that the full effect originally expected of devaluation has now come through. Between June and September the rise was 11/2 per cent.

^{note (1) page 15} See Details of demand, pages 20-21, table 8.

^{note (2) page 15} SO far, however, developments have been rather dis appointing. Tourist earnings in the first half of this year were only 8 per cent higher than in the first half of 1967, even though tourist arrivals reportedly rose by 13 per cent between the same two periods.

^{note (1) page 16} Some details of what was then known about repayment obligations were given in the National Institute Economic Review no. 44, May 1968, page 17.

^{note (1) page 19} The Board of Trade Journal, 18 October 1968, page 1063.