1$.25$.01$2.8610$5.1$.6246$1.2942$.0238$.4509$.2178$.0356$1.6514$.02155$.376$*pH6 7d46 *******************************************************************$d4 * *$d4 * THIS IS THE DECISION SCIENCES AND SOFTWARE VERSION OF THE ST *$d4 * LOUIS FEDERAL RESERVE DISTRICT ECONOMETRIC MODEL IMPLEMENTED *$d4 * FOR MICROCOMPUTERS. THIS VERSION PROVIDES RETROSPECTIVE SIMU- *$d4 * LATION AND UP TO A SEVEN YEAR FORECASTING CAPABILITY. DRIVE *$d4 * 'B' FILES PROVIDE THE ECONOMIC DATA - 'ECON1.DAT' AND YOUR OWN *$d4 * FORECAST FILES PLUS ANY FILES YOU WANT. *$d4 * *$d4 * DECISION SCIENCES AND SOFTWARE *$d4 * (COPYRIGHT 1981) LIMITED LICENSE TO SIG/M USER'S GROUP *$d4 * *$d4 *******************************************************************$d4d4 **** BE SURE YOUR PRINTER IS NOT IN A PROPOTIONAL PRINT MODE! **** $d4d4C C C C C C C C  C  C  C  C  C C C C              C C   3 .0072,.0111,.0145,.0173,.0195,.0213,.0225,.0231,.0232,.0228,3 .0218,.0203,.0183,.0157,.0126,.0089,.0047,3 .0562,.0633,.0691,.0736,.0769,.0788,.0794,.0787,.0767,.0734,3 .0688,.0629,.0557,.0471,.0373,.0262,.0137,3 .0238,.0386,.0500,.0579,.0625,.0637,.0616,.0560,.0471,.0348,.0191,3 .1829,.1681,.1529,.1373,.1214,.1051,.0885,.0715,.0542,.0365,.0184,3 .0120,.0276,.0362,.0377,.0322,.0196,3 .0611,.0481,-.0015,-.0504,-.0620,3 .4640,.4603,.2484,.0239,-.0814,3 1,2,3,4,1,2,3,4,NOYES EXIT6x 7!=6k6 7!=66 7!=66ۀ 7!=6΀6 7!=66 7)!=66> 7J!=616_ 7l!=:6Rd4IS THIS YOUR FIRST EXPERIENCE WITH THE FED(TM0 -YES OR NO?: n;!1'd4!76'& TUTORIAL TUTORIAL TUTORIAL TUTORIAL . TUTORIAL TUTORIAL TUTORIAL TUTORIAL $d4 T THE ECONOMISTS OF THE ST LOUIS FEDERAL RESERVE DISTRICT CONSID- T $d4 T ER THAT THE US ECONOMY MAY BE FORECASTED USING THREE AND ONLY THREE T $d4 T VARIABLES. THESE THREE VARIABLES ARE: T $d4 T 1) THE CHANGE IN THE MONEY SUPPLY - M1B! T $d4 T 2) THE CHANGE IN GOVERNMENT EXPENDITURES! T $d4 T 3) THE CHANGE IN THE CAPACITY OF THE ECONOMY! T $d4 T THESE ARE THE ONLY THREE INPUTS INTO 'THE FED'(TM) WHICH IS A MICRO- T $d4 T COMPUTER VERSION OF THEIR MODEL OF THE US ECONOMY - WHICH THEY USE T $d4 T TO SET MONEY SUPPLY POLICIES. THE FIRST VARIABLE IS INPUT INTO 'THE T $d4 T FED(TM)' AS THE QUARTERLY RATE OF CHANGE EXPRESSED IN ANNUAL TERMS- T $d4 T A 2.5 % PER QUARTER CHANGE INCREASE IN THE MONEY SUPPLY IS INPUT AS T $d4 T 10 PER CENT FOR EACH QUARTER - THE PROGRAM AUTOMATICALLY HANDLES IT T $d4 T AND CONVERTS THE PER CENT CHANGE TO A DOLLAR AMOUNT. SIMILARLY THE T $d4 T CHANGE IN GOVERNMENT EXPENDITURES IS INPUT AS THE QUARTERLY RATE OF T $d4 T CHANGE IN ANNUAL TERMS OF THE 'HIGH EMPLOYMENT BUDGET' ROUGHLY TOTAL T $d4 T GOVERNMENT EXPENDITURES LESS UNEMPLOYMENT BENEFITS. THE CHANGE IN T $d4 T THE CAPACITY OF THE ECONOMY IS ALSO INPUT AS A RATE OF CHANGE IN AN- T $d4 T NUAL TERMS AND CONVERTED TO DOLLARS BY THE PROGRAM. THIS BUSINESS T $d4 T OF EXPRESSING CHANGES IN ANNUAL PERCENTAGE TERMS IS CALLED 'DOT.' IT T $d4 T WILL BE USED EXTENSIVELY IN THIS TUTORIAL! T $d4 T THE QUARTERLY VALUES FOR EACH QUARTER ARE READ IN FROM YOUR FORE- T $d4 THE END OF THE FIRST TUTORIAL PAGE. ENTER 'NEXT' (CR) FOR PAGE 2:n;"1'd4 TUTORIAL TUTORIAL TUTORIAL TUTORIAL . TUTORIAL TUTORIAL TUTORIAL TUTORIAL $d4 T CAST FILE, THREE VALUES FOR EACH QUARTER. THE NUMBER OF QUARTERS AND T $d4 T THE QUARTER OF THE FIRST FORECAST MUST ADD UP TO AN ODD NUMBER OF EN- T $d4 T TIRE YEARS. FOR EXAMPLE, IF YOU START YOUR FORECAST IN THE THIRD T $d4 T QUARTER OF 1981, 18 QUARTERS PLUS THE TWO QUARTERS OF HISTORY IN 1981 T $d4 T ADD UP TO 20 QUARTERS OR FIVE COMPLETE YEARS -THAT'S AN ODD NUMBER OF T $d4 T YEARS. THIS IS REQUIRED BECAUSE 'THE FED(TM)' PRINTS TWO YEARS PER T $d4 T PAGE OF OUTPUT AND ALWAYS PRINTS AT LEAST ONE FULL YEAR OF HISTORY. T $d4 T AFTER YOU COMPLETE YOUR INPUT, YOU'LL WAIT A BIT BEFORE 'THE FED(TM)' T $d4 T DOES EVERYTHING IT HAS TO DO AND DISPLAYS THE FIRST YEAR OR FRACTION T $d4 T OF A YEAR'S FORECAST SO YOU CAN CHECK IT. I'LL NOW 'DECODE' THE DIS- T $d4 T PLAY FOR YOU! THE THREE INPUTS ARE AT THE BOTTOM OF THE SCREEN AFTER T $d4 T '** INPUTS*.' THEY ARE, IN ORDER, THE CHANGE IN MONEY SUPPLY, THE T $d4 T CHANGE IN THE HIGH EMPLOYMENT BUDGET AND THE CHANGE IN POTENTIAL GNP, T $d4 T RESPECTIVELY - ALL IN 'DOT' OR ANNUAL RATE OF CHANGE TERMS. GOING T $d4 T NOW TO THE TOP OF THE PAGE: GNP-CUR$ IS GNP IS CURRENT OR CONTEMPOR- T $d4 T ARY DOLLARS, THAT IS THE PRICE LEVEL DURING THAT QUARTER; GNP-POT IS T $d4 T POTENTIAL GNP IN 1972$- THE CAPACITY OF THE ECONOMY; GNP-1972$ IS T $d4 T ACTUAL GNP IN CONSTANT (1972) DOLLARS WHILE DEMAND PRESSURE IS A T $d4 T MEASURE OF THE PRESSURE OF GNP-1972$ AGAINST GNP-POT - THE HIGHER THE T $d4 T PRESSURE, THE MORE PRESSURE ON PRICES; PRICES '72 PRICE LEVEL WITH T $d4 T END OF THE SECOND TUTORIAL PAGE. ENTER 'NEXT' FOR PAGE 3:n;"1'd4 TUTORIAL TUTORIAL TUTORIAL TUTORIAL . TUTORIAL TUTORIAL TUTORIAL TUTORIAL $d4 T 1972 PRICES=1OO; GNP-GAP THE DIFFERENCE IN % BETWEEN POTENTIAL AND T $d4 T ACTUAL(1972$) GNP; MONEY SUPPLY-M1B IN CURRENT DOLLARS; THE SO-CALLED T $d4 T VELOCITY OF MONEY-GNP-CUR$/MONEY SUPPLY; THE LONG TERM INTEREST RATE- T $d4 T MOODYS SEASONED (LARGE A FOLLOWED BY TWO SMALL AS) BONDS; THE SHORT T $d4 T TERM INTEREST RATE-3 TO 4 MONTH COMMERCIAL PAPER; THE HIGH EMPLOYMENT T $d4 T GOVERNMENT EXPENDITURES BUDGET; THE UNEMPLOYMENT RATE; THE RATE OF T $d4 T CHANGE IN CURRENT OR 'N' FOR NOMINAL GNP; THE RATE OF CHANGE IN REAL T $d4 T OR 1972$ GNP; AND THE ANNUAL RATE OF CHANGE IN PRICES. 'THE FED(TM)' T $d4 T PROGRAM THEN WANTS TO KNOW IF YOU WANT TO PRINT THE PAGE FOR FURTHER T $d4 T STUDY AND, IF NOT, WHETHER OR NOT YOU WANT TO CHANGE ANY OR ALL OF T $d4 T THE FORECAST INPUTS-MONEY SUPPLY, GOVERNMENT EXPENDITURES, OR POTEN- T $d4 T IAL GNP. THE PROGRAM WILL NOT GO ON TO FORECAST THE NEXT YEAR UNTIL T $d4 T YOU HAVE TOLD IT YOU DON'T WANT A PRINT AND YOU DON'T WANT ANY MORE T $d4 T CHANGES TO THE INPUT VALUES DISPLAYED FOR THE FORECAQST QUARTERS. T $d4 T THE PROGRAM THEN GOES ON TO FORECAST THE NEXT YEAR, COURTEOUSLY T $d4 T ALLOWING YOU TO PRINT OR MAKE CHANGES AS YOU GO, TO ADJUST YOUR EST- T $d4 T MATE OF THE REACTION OF THE VARIOUS AUTHORITIES TO THE RESULTS WHICH T $d4 T ARE FORECASTED. AFTER IT HAS COMPLETED PROCESSING YOUR ENTIRE FORE- T $d4 T CAST FILE IT WILL THEN PRINT THE OUTPUT. T $d4 T THE ENTIRE 'THE FED(TM)' PACKAGE INCLUDES THE PROGRAM, ITSELF, T $d4 T THE SAMPLE INPUT FILE, FORCAST2.DAT, THE ECONOMIC HISTORY FILE, PLUS T $d4 T THIS IS THE END OF THE THIRD PAGE. ENTER 'NEXT' FOR PAGE 4:n;"1'd4 TUTORIAL TUTORIAL TUTORIAL TUTORIAL . TUTORIAL TUTORIAL TUTORIAL TUTORIAL $d4 T PLUS ONE PROGRAM FOR PRINTING ANY FORECAST FILE, AND ANOTHER PROGRAM T $d4 T FOR PRINTING THE ECONOMIC FILE. THE FIELDS OF THE ECONOMIC FILE ARE T $d4 T ARE LISTED IN ORDER, HERE: GNP-CUR(CURRENT GNP), GNP-N-DOT(RATE OF T $d4 T CHANGE-CURRENT DOLLARS), GNP-1972$(GNP IN 1972 $ - CONSTANT!), GNP R T $d4 T DOT(RATE OF CHANGE IN REAL(1972) DOLLARS, PRICES WITH 1972 = 100, T $d4 T RATE OF CHANGE IN PRICES, VELOCITY OF MONEY, GNP-GAP, UNEMPLOYMENT, T $d4 T LONG TERM INTEREST RATE, SHORT TERM INTEREST RATE, POTENTIAL GNP - T $d4 T REMEMBER CONSTANT 1972 DOLLARS, THE HIGH EMPLOYMENT GOVERNMENT EX- T $d4 T PENDITURE BUDGET, THE MONEY SUPPLY -FOLLOWED BY THE RATE OF CHANGE, T $d4 T AND LAST THE QUARTER AND YEAR OF THE ECONOMIC DATE DISPLAYED AS Q.YY! T $d4 T THIS DESCRIPTION MAY BE SUPPLEMENTED BY THE USER'S MANUAL FOR 'THE T $d4 T FED(TM).' THIS 50 PAGE MANUAL CONTAINS A MORE COMPLETE DESCRIPTION OF T $d4 T THE PROGRAM, INCLUDING THE RETROSPECTIVE SIMULATION OPTIONS; THE LIMI-T $d4 T TATIONS; THE RATIONALE FOR CONTROL INPUTS; PROCEDURES FOR UPDATING T $d4 T THE ECONOMIC FILE SUPPLEMENTING THE DISCUSSION ABOVE; (THE VARIABLES T $d4 T ARE PUBLISHED BY THE DEPARTMENT OF COMMERCE IN 'THE SURVEY OF CURRENT T $d4 T BUSINESS.') CONSTRUCTING FORECAST FILES; A DISCUSSION OF THE MODEL T $d4 T AS DEVELOPED BY THE ST. LOUIS FEDERAL RESERVE DISTRICT, A DISCUSSION T $d4 T OF FEDERAL RESERVE BOARD POLICY MAKING, FORECASTING HINTS, A DESCRIP- T $d4 T TION OF THE PROGRAM AND THE ERROR CODES; TOPPED OFF BY A GLOSSARY AND T $d4 T A SEVENTEEN ITEM BIBLIOGRAPHY OF PERTINENT MATERIALS. IN ADDITION T $d4 THIS ENDS PAGE FOUR OF THE TUTORIAL. ENTER 'NEXT' FOR PAGE 5:n;"1'd4 TUTORIAL TUTORIAL TUTORIAL TUTORIAL . TUTORIAL TUTORIAL TUTORIAL TUTORIAL $d4 T YOU WILL GET A PRINTED UPDATE OF THE ECONOMIC DATA TO THE MOST RECENT T $d4 T QUARTER AVAILABLE, GENERALLY 6 MONTHS OR SO BEHIND YOUR ORDER. T $d4 T THE MANUAL MAY BE ORDERED FROM: PLAIN TALK PRESS T $d4 T BOX 16023 T $d4 T IRVINE, CA 92714-6023 T $d4 T PRICES EACH: PERSONAL/COMMERCIAL 1-10 $ 25.00; OVER 10 $12.00 T $d4 T EDUCATION(SCHOOLS) 1-10 $ 15.00; OVER 10 $ 7.00 T $d4 T ADD $1.OO/MANUAL FOR HANDLING:CAL RESIDENTS ADD 6 % SALES TAX T $d4 T TERMS: CHECK/MONEY ORDER ALLOW ONE MONTH FOR DELIVERY T $d4 T T $d4 T******* ALL PRINTED MATERIALS COPYRIGHT ALL RIGHTS RESERVED ******T $d4d4 THIS ENDS THE TUTORIAL. ENTER 'NEXT' TO INVOKE THE PROGRAM;n;"1'd4d4!7'{DO NOT ENTER THE QUOTE MARKS AROUND THE SUGGESTED INPUTS THAT FOLLOW!$d4!7'PRETEND TODAY IS JUNE 30, 1982 RESPOND '30,6,1982' TO PROMPT$d4ENTER DAY, MONTH YEAR IN FORMAT -XX,XX,XXXX: n;#":$":%":'!7(d4!7(gYOU WANT YOUR FORECAST TO BEGIN IN THE THIRD QUARTER OF 1981$d4!7(SO YOU RESPOND '3,1981' TO THE NEXT PROMPT$d4QUARTER AND YEAR OF FIRST FORECAST QUARTER IN FORMAT -X.XXXX:n;&":'":'!7(d4!7)CTHE LAST QUARTER IN THE DATA BASE IS THE SECOND QUARTER OF 1981$d4!7)SO YOU RESPOND '2,1981' TO THE DATA BASE PROMPT$d4LAST QUARTER AND YEAR OF DATA BASE IN FORMAT -X.XXXX: n;(":)":'!7)d4!7*"YOU WANT TO FORECAST TO THE END OF 1986 - FIVE YEARS LESS THE$d4!7*p2 QUARTERS IN 1981, SO YOU RESPOND '18' TO NO OF QUARTERS PROMPT$d4NUMBER OF FORECAST QUARTERS IN FORMAT -XX: n;*":'!7*d4!7+ THE DEMONSTARTION FORECAST IS ON DRIVE B, YOU RESPOND WITH$d4!7+LIT'S NAME, 'FORCAST2.DAT,' TO THE FILE NAME PROMPT$d4FORECAST FILE NAME (DRIVE B ASSUMED): n;+1'!7+d4!7+NAME THIS RUN 'DEMONSTRATION' IN YOUR RESPONSE TO THE LAST PROMPT$d4ENTER MAXIMUM 40 ALPHA-NUMERIC TITLE ON NEXT LINE AFTER PROMPT:$d4TITLE: n;,1'd46,W 7,l&!7,i6,o6,J6G6, 7,(!7,6,6,w6H@-*pr..&p'p/.(p)p0/.pr07,6H1&*2131pp2p37- 6.#*2&d4*********************** WARNING **********************$d4*$d4**** NO OF FORECAST QUARTERS DOESN'T MATCH TABLE RESET TO: $*p#d4*$d4*********************** WARNING **********************$d4d4ENTER ANY CHARACTER AND CARRIAGE RETURN TO CONTINUE: n;41'5(B:ECON1.DATj66.S(66 7.(6&!)!)!)!)!)!)!)!) !) !) !) !) !)!)!)7)>6.F850B:+j6/* 7/D98&9!)9!)9!)>6/ :866/a:66 7/86!!! !!!d ! !ppp!d ! !ppp6/T60 70!'6/60) 709!'60070H61E60K60K00660h066 71=56!p56!p56!p56!p56!p56!p56!p56!p56 !p56 !p56 !p56 !p56 !p56!p56!p60[00;<=&;;61t 71!!61g;^961616161616161<===<61= 72>.8!pNp>>K8!>8!?.8!pNp??K8 !?8 !@.8!pNp@@K8 !@8 !619<62=99 76G89!.662Ā66 73!!6!6!!!6!6!62>.!p>>Np>>K!>!A!!!!!!A !!Bp66366 73BB6!.6!6 !63B.BpBB.p!C..B664066 74MCC6!6!64#DAC!dp!D!!dD!pppp!d!p!!d!!ppp! !! !!d!p !.!.!. !. 0. !665w 66 75 ! !6!6!6!.6!6 !65j !. . !66566 76D ! !6!6!6!.6!6 !6562E#####.#F # ####G8=HGIHJIKJLKMLN8=66fd4 CHECKING FORECAST OF THIS DATE: ## ## #### PAGE NO. # c#p#5$p#5%p#5;p#d4d4JdFc!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#5!p#d4JGNP-CUR$ $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JGNP-POT $dEcG !#5H !#5I !#5J !#5K !#5L !#5M !#5N !#d4JGNP-1972$ $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JDMND-PRES $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JPRICES '72$dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JGNP-GAP $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JMONEY SUP $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JVEL MONEY $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JLONG INT $dEcG !#5H !#5I !#5J !#5K !#5L !#5M !#5N !#d4JSHORT INT $dEcG !#5H !#5I !#5J !#5K !#5L !#5M !#5N !#d4JHI EMP EX $dEcG !#5H !#5I !#5J !#5K !#5L !#5M !#5N !#d4JUNEMPLOY $dEcG !#5H !#5I !#5J !#5K !#5L !#5M !#5N !#d4JGNP N DOT $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JGNP R DOT $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JPRICE DOT $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4J** INPUTS*$d4JM1B DOT $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JHI EE DOT $dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4JOUTPOT DOT$dEcG!#5H!#5I!#5J!#5K!#5L!#5M!#5N!#d4PRINT THIS? FORMAT -YES,NO,EXIT: n;O1'O7?6666?96?9O 7?H6G6?K6?KgDO YOU WANT TO CHANGE MONEY SUPPLY? FORMAT YES/NO: n;P1'DO YOU WANT TO CHANGE HIGH.EMP.EXP? FORMAT YES/NO: n;Q1'DO YOU WANT TO CHANGE POT.GNP? FORMAT YES/NO: n;R1'PQ R 7@)6A6@,6@,S=<THE NUMBER OF INPUTS IS: $Sp#d4P7@h6@6@k6@kINPUT MONEY SUPPLY VALUES: ONE INPUT PER LINE$dT6@STT 7@ˀn;8<T!"'6@d4Q7@6AJ6@6@INPUT HIGH EMPLOYMENT EXPENDITURES: ONE INPUT PER LINE$dT6A.STT 7AHn;8<T!"'6A!d4R7AY6A6A\6A\INPUT POTENTIAL GNP: ONE INPUT PER LINE$dT6ASTT 7An;8<T!"'6A61;-7A61W6A6AfU8&VU!'!WX*ppp. rY6B'XYY 7GUVVUW!W!MOVE PAPER PERFORATION TO TOP OF PRINT HEAD AND INPUT ANY SYMBOLn;Z":'[6B [[ 7Bd46BJ,$d4d4JMONETARY ECONOMETRIC MODEL FORECAST DSS VERSION$d4DATE: ## ## ####c