For use at 12:00 p.m., eastern time
                                                                                        December 9, 2010




FEDERAL RESERVE statistical release

Z.1




Flow of Funds Accounts
of the United States
Flows and Outstandings
Third Quarter 2010




Board of Governors of the Federal Reserve System, Washington DC 20551
                                  Flow of Funds Summary Statistics
                                  C




                                         Third Quarter 2010
Debt of the domestic nonfinancial sectors is                  in commercial mortgages and bank loans outstanding.
estimated to have expanded at a seasonally adjusted
annual rate of 41⁄4 percent in the third quarter of 2010,       State and local government debt rose 51⁄4 percent at
1⁄2 percentage point less than in the previous quarter.         an annual rate in the third quarter, after a 11⁄2 percent
Private debt changed little in the third quarter, while       decline in the second quarter. Federal government
federal government debt continued to grow rapidly.            debt increased at an annual rate of 16 percent in the
                                                              third quarter, 61⁄2 percentage points less than the
Household debt contracted at an annual rate of 13⁄4             average during the first half of the year.
percent in the third quarter, the tenth consecutive
quarterly decline. Home mortgage debt fell at an              At the end of the third quarter of 2010, the level of
annual rate of 21⁄2 percent in the third quarter, about         domestic nonfinancial debt outstanding was $35.9
the same as in the previous quarter. Consumer credit          trillion; household debt was $13.4 trillion,
was down 11⁄2 percent, after a decline of 31⁄4 in the             nonfinancial business debt was $11.0 trillion, and
previous quarter.                                             total government debt was $11.5 trillion.

Nonfinancial business debt rose 13⁄4 percent in the             Household net worth—the difference between the
third quarter, after remaining about flat over the first      value of assets and liabilities—was an estimated
half of this year. Corporate bonds outstanding posted         $54.9 trillion at the end of the third quarter, up about
another strong increase, more than offsetting declines        $1.2 trillion from the end of the previous quarter.


Growth of Domestic Nonfinancial Debt1          P
                                           P




Percentage changes; quarterly data are seasonally adjusted annual rates
                                                                                State and
                           Total               Households    Business                                  Federal
                                                                               local govts.
 2000                       5.0                     9.1          9.3               1.4                  -8.0
 2001                       6.3                     9.6          5.7               8.8                  -0.2
 2002                       7.4                    10.8          2.8              11.1                   7.6
 2003                       8.1                    11.8          2.3               8.3                  10.9
 2004                       8.8                    11.0          6.2               7.3                   9.0

 2005                       9.5                    11.1         8.6               10.2                   7.0
 2006                       9.0                    10.1        10.5                8.3                   3.9
 2007                       8.6                     6.8        13.1                9.5                   4.9
 2008                       6.0                     0.3         5.5                2.3                  24.2
 2009                       3.0                    -1.7        -2.6                4.9                  22.7

 2009:Q1                    4.7                    -0.8          0.1               5.6                  24.4
      Q2                    4.4                    -1.9         -2.6               4.3                  28.9
      Q3                    2.1                    -2.2         -4.3               5.8                  19.0
      Q4                    0.9                    -2.0         -3.7               3.8                  11.9

 2010:Q1                  4.3               -2.1                 0.4               5.6                  20.5
      Q2                  4.7               -2.2                -0.1              -1.5                  24.4
      Q3                  4.2               -1.7                 1.7               5.2                  16.0
1. Changes shown are on an end-of-period basis.
                                             Table of Contents


Title                                                                            Table      Page


Flow of Funds Accounts, Third Quarter 2010                                                    1

Availability of Data for Latest Quarter                                                       4

Credit Market Debt Growth by Sector                                              D.1          7

Credit Market Borrowing by Sector                                                D.2          8

Credit Market Debt Outstanding by Sector                                         D.3          9




                                                                    Flows             Levels
Title                                                          Table      Page   Table       Page



Summaries
Total Credit Market Borrowing and Lending                      F.1        10     L.1         60

Credit Market Borrowing by Nonfinancial Sectors                F.2        11     L.2         61

Credit Market Borrowing by Financial Sectors                   F.3        11     L.3         61

Credit Market Borrowing, All Sectors, by Instrument            F.4        12     L.4         62

Total Liabilities and Its Relation to Total Financial Assets   F.5        12     L.5         62

Distribution of Gross Domestic Product                         F.6        13

Distribution of National Income                                F.7        14

Saving and Investment                                          F.8        15

Net Capital Transfers                                          F.9        16

Derivation of Measures of Personal Saving                      F.10       17     L.10        63
                                                            Flows             Levels
Title                                                  Table      Page   Table       Page


Sectors
Households and Nonprofit Organizations                 F.100      18     L.100       64

Nonfinancial Business                                  F.101      19     L.101       65

         Nonfarm Nonfinancial Corporate Business       F.102      20     L.102       66
         Nonfarm Noncorporate Business                 F.103      21     L.103       67
         Farm Business                                 F.104      21     L.104       67

State and Local Governments                            F.105      22     L.105       68

Federal Government                                     F.106      23     L.106       68

Rest of the World                                      F.107      24     L.107       69

Monetary Authority                                     F.108      25     L.108       70

Commercial Banking                                     F.109      26     L.109       71

         U.S.-Chartered Commercial Banks               F.110      27     L.110       72
         Foreign Banking Offices in U.S.               F.111      28     L.111       73
         Bank Holding Companies                        F.112      29     L.112       74
         Banks in U.S.-Affiliated Areas                F.113      29     L.113       74

Savings Institutions                                   F.114      30     L.114       75

Credit Unions                                          F.115      31     L.115       76

Property-Casualty Insurance Companies                  F.116      31     L.116       76

Life Insurance Companies                               F.117      32     L.117       77

Private Pension Funds                                  F.118      32     L.118       77

State and Local Government Employee Retirement Funds   F.119      33     L.119       78

Federal Government Retirement Funds                    F.120      33     L.120       78

Money Market Mutual Funds                              F.121      34     L.121       79

Mutual Funds                                           F.122      34     L.122       79
                                                        Flows             Levels
Title                                              Table      Page   Table       Page


Closed-End and Exchange-Traded Funds               F.123      34     L.123       79

Government-Sponsored Enterprises                   F.124      35     L.124       80

Agency- and GSE-backed Mortgage Pools              F.125      35     L.125       80

Issuers of Asset-Backed Securities                 F.126      36     L.126       81

Finance Companies                                  F.127      36     L.127       81

Real Estate Investment Trusts                      F.128      37     L.128       82

Security Brokers and Dealers                       F.129      38     L.129       83

Funding Corporations                               F.130      38     L.130       83




Instruments
U.S. Official Reserve Assets                       F.200      39     L.200       84

SDR Certificates and Treasury Currency             F.201      39     L.201       84

U.S. Deposits in Foreign Countries                 F.202      39     L.202       84

Net Interbank Transactions                         F.203      40     L.203       85

Checkable Deposits and Currency                    F.204      41     L.204       86

Time and Savings Deposits                          F.205      42     L.205       87

Money Market Mutual Fund Shares                    F.206      42     L.206       87

Federal Funds and Security Repurchase Agreements   F.207      43     L.207       88

Open Market Paper                                  F.208      43     L.208       88

Treasury Securities                                F.209      44     L.209       89
                                                                      Flows                  Levels
Title                                                         Table           Page   Table        Page


Agency- and GSE-backed Securities                             F.210           45     L.210            90

Municipal Securities and Loans                                F.211           46     L.211            91

Corporate and Foreign Bonds                                   F.212           46     L.212            91

Corporate Equities                                            F.213           47     L.213            92

Mutual Fund Shares                                            F.214           47     L.214            92

Bank Loans Not Elsewhere Classified                           F.215           48     L.215            93

Other Loans and Advances                                      F.216           49     L.216            94

Total Mortgages                                               F.217           50     L.217            95

        Home Mortgages                                        F.218           51     L.218            96
        Multifamily Residential Mortgages                     F.219           51     L.219            96
        Commercial Mortgages                                  F.220           52     L.220            97
        Farm Mortgages                                        F.221           52     L.221            97

Consumer Credit                                               F.222           53     L.222            98

Trade Credit                                                  F.223           53     L.223            98

Security Credit                                               F.224           53     L.224            98

Life Insurance and Pension Fund Reserves                      F.225           54     L.225            99

Taxes Payable by Businesses                                   F.226           54     L.226            99

Proprietors' Equity in Noncorporate Business                  F.227           54     L.227            99

Total Miscellaneous Financial Claims                          F.228           55     L.228        100

        Identified Miscellaneous Financial Claims - Part I    F.229           56     L.229        101
        Identified Miscellaneous Financial Claims - Part II   F.230           57     L.230        102
        Unidentified Miscellaneous Financial Claims           F.231           58     L.231        103

Sector Discrepancies                                          F.11            59

Instrument Discrepancies                                      F.12            59
                                                                       Balance       Reconciliation
                                                                        Sheet
Title                                                              Table      Page   Table      Page


Balance Sheet and Reconciliation Tables
Households and Nonprofit Organizations                             B.100     104     R.100      107

Nonfinancial Corporate Business                                    B.102     105     R.102      108

Nonfarm Noncorporate Business                                      B.103     106     R.103     109




                                                                        Flows             Levels
Title                                                              Table      Page   Table       Page


Supplementary Tables
Nonprofit Organizations                                            F.100.a   110     L.100.a    111

Consolidated Statement for Federal, State, and Local Governments   F.106.c   112     L.106.c    113

Private Pension Funds: Defined Benefit Plans                       F.118.b   114     L.118.b    115

Private Pension Funds: Defined Contribution Plans                  F.118.c   114     L.118.c    115

Individual Retirement Accounts (IRAs)                              F.225.i   114     L.225.i    115

Flow of Funds Matrix for 2009                                                116                117

Balance Sheet of Households and Nonprofit Organizations
 with Equity Detail                                                                  B.100.e    118
                                                                                                                          1




                        Flow of Funds Accounts, Third Quarter 2010

                                                              Relation of Flows to Outstandings. Estimates of
This publication presents the Flow of Funds
                                                              financial assets and liabilities outstanding are linked
Accounts for 2010:Q3.
                                                              to data on flows. However, figures on outstandings
                                                              contain discontinuities or breaks in series that could
Data revisions and other changes. The statistics in
                                                              affect analysis of particular relationships over time.
the attached tables reflect the use of new or revised
                                                              Specifically, outstandings in the flow of funds
source data. Most significant revisions appear in
                                                              accounts are related to the flows in the following
recent quarters; however, new source information
                                                              way:
resulted in changes to data for earlier periods.

                                                              Outstanding t = Outstanding t-1+ Flow t+ Discontinuityt
1. Many nine-digit flow of funds mnemonics                                B   B           B       B       B   B               B   B




                                                              where “t” is the time period.
have been changed to make the coding more
consistent across instrument categories. A list of
                                                              Discontinuities result from changes in valuation,
these code changes is available online at:
                                                              breaks in source data, and changes in definitions. For
                                                              most series, the value of the discontinuity is zero for
http://www.federalreserve.gov/Releases/Z1/preview/Code_chan
                                                              nearly all time periods. However, in a few instances,
ges/
                                                              the discontinuity is nonzero for almost all time
2. The term “net financial investment” has been               periods, or is quite large in a particular quarter, such
changed on a number of tables to “net lending (+) or          as a period when there is a sharp increase or decrease
net borrowing (-)” to be consistent with System of            in equity prices or a major break in source data.
National Accounts (SNA) terminology.
                                                              The discontinuities in a series can distort estimated
Explanatory notes for tables D.1, D.2, and D.3.               rates of growth in assets and liabilities between
Domestic debt comprises credit market funds                   periods. In order to minimize these distortions,
borrowed by U.S. entities from both domestic and              percentage changes in assets and liabilities in flow of
foreign sources, while foreign debt represents                funds releases should be calculated as:
amounts borrowed by foreign financial and
nonfinancial entities in U.S. markets only. Financial         Percentage change t = (Flow t / Outstanding t-1) * 100
                                                                                  B   B       B       B           B   B




sectors consist of government-sponsored enterprises,
agency- and GSE-backed mortgage pools, the                    Preliminary Estimates. Figures shown for the most
monetary authority, and private financial institutions.       recent quarter in these tables are based on
Credit market debt consists of debt securities,               preliminary and incomplete information. A summary
mortgages, bank loans, commercial paper, consumer             list of the principal sources of information available
credit, U.S. government loans, and other loans and            when the latest quarter's data were compiled is
advances; it excludes trade debt, loans for the               provided in a table following this introduction. The
purpose of carrying securities, and funds raised from         distinction between “available” data and “missing”
equity sources. This definition is consistent with the        data is not between final and preliminary versions of
presentation of credit market borrowing and lending           data, but rather between those source estimates that
on tables F.1 through F.4. Net lending (+) or net             are fully ready when the latest quarterly publication
borrowing (-) on the individual sector tables and the         is compiled and those that are not yet completed.
matrix is defined as net acquisition of financial assets      However, the items that are shown as available are, in
less net increase in liabilities.                             general, also preliminary in the sense that they are
                                                              subject to revision by source agencies.
Growth rates in table D.1 are calculated by dividing
seasonally adjusted flows from table D.2 by                   Margins of Uncertainty. Flow of funds statistics are
seasonally adjusted levels at the end of the previous         subject to uncertainties resulting from measurement
period from table D.3. Seasonally adjusted levels in          errors in source data, incompatibilities among data
flow of funds statistics are derived by carrying              from different sources, potential revisions in both
forward year-end levels by seasonally adjusted flows.         financial and nonfinancial series, and incomplete data
Growth rates calculated from changes in unadjusted            in parts of the accounts. The size of these
levels printed in table L.2 can differ from those in          uncertainties cannot be quantified in precise
table D.1.                                                    statistical terms, but allowance for them is explicitly
2

made throughout the accounts by the inclusion of         In addition, these data, as well as data for the
“discrepancies” for various sectors and instrument       quarterly and annual Integrated Macroeconomic
types. A discrepancy for a sector is the difference      Accounts for the United States tables, are available as
between its measured sources of funds and its            customizable download datasets through the Data
measured uses of funds. For an instrument category,      Download Program (DDP) at the following location:
a discrepancy is the difference between measured
funds borrowed through the financial instrument and      www.federalreserve.gov/datadownload/Choose.aspx?rel=Z.1
measured funds lent through that instrument. The size
                                                         A Guide to the Flow of Funds Accounts is available.
of such discrepancies relative to the main asset or
                                                         The 1,200-page Guide, published in two volumes in
liability components is one indication of the quality
                                                         January 2000, explains in detail how the U.S.
of source data, especially on an annual basis. For
                                                         financial accounts are prepared and the principles
quarterly data, differences in seasonal adjustment
                                                         underlying the accounts. The Guide can be purchased
procedures for financial and nonfinancial components
                                                         for $20.00 from the Board’s Publications Services.
of the accounts sometimes result in discrepancies that
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cancel in annual data.
                                                         checks as well as credit card orders.
Availability of Data. Flow of funds statistics are
                                                         The Internet site for this release at the location shown
updated about ten weeks following the end of a
                                                         above contains a link to an order form for the Guide
quarter. This publication — the Z.1 release — is
                                                         that can be mailed or faxed to Publications Services.
available from the Board's Publications Services.
                                                         In addition, the Internet site includes a link to the
Flow of funds data are also available electronically
                                                         Guide’s descriptions of the tables in the flow of funds
through the Internet at the following location:
                                                         accounts.
                                                         Subscription Information. The Federal Reserve
www.federalreserve.gov/releases/Z1
                                                         Board charges for subscriptions to all statistical
                                                         releases. Inquiries for releases should be directed to:
This Internet site also provides coded tables and
historical annual tables beginning in 1945 that
                                                                    Publications Services, Stop 127
correspond to the tables published in this release.
                                                                          Board of Governors
There are also compressed ASCII files of quarterly
                                                                    of the Federal Reserve System
data for seasonally adjusted flows, unadjusted flows,
                                                              20th Street and Constitution Avenue, N.W.
outstandings, balance sheets, debt (tables D.1, D.2,
                                                                        Washington, DC 20551
and D.3), and supplementary tables.
                                                                            (202) 452-3244
                                       3




[THIS PAGE INTENTIONALLY LEFT BLANK]
4



                          Availability of Data for Latest Quarter


                                   Available at time of publication           Major items missing
                                   U                                 U        U                       U




1. National income and             Second estimate, seasonally adjusted,      Unadjusted flows since 2006.
   product accounts (NIPA)         for 2010:Q3.

2. Households and nonprofit        Estimates for this sector are largely residuals and are derived from data for
   organizations sector            other sectors. Availability of data depends on schedules for other sectors.
   (tables F.100 and L.100)        Data for consumer credit, which are estimated directly, are available
                                   through 2010:Q3. The source for nonprofit organizations data (tables
                                   F.100.a and L.100.a) is the Internal Revenue Service Statistics of Income.
                                   Data for nonprofit organizations are available for 1987 through 2000.

3. Nonfarm nonfinancial            Quarterly Financial Report (QFR) of            Statistics of Income data since
   corporate business              the Census Bureau through 2010:Q2;             2008.
   (tables F.102 and L.102)        Internal Revenue Service Statistics of
                                   Income (IRS/SOI) data through 2008;
                                   securities offerings, mortgages, bank
                                   loans, commercial paper, and other
                                   loans through 2010:Q3.

4. Nonfarm noncorporate            IRS/SOI data through 2007; bank and            Statistics of Income data since
   business                        finance company loans and mortgage             2007.
   (tables F.103 and L.103)        borrowing through 2010:Q3.

5. Farm business                   Mortgages, bank loans, loans from              Consumption of fixed capital
   (tables F.104 and L.104)        government-sponsored enterprises,              and undistributed profits since
                                   U.S. government loans to farms, and            2008.
                                   equity in government-sponsored
                                   enterprises through 2010:Q3;
                                   preliminary data for checkable deposits
                                   and currency and trade payables
                                   through 2008.
6. State and local governments     Gross offerings and retirements of             Total financial assets since
   (tables F.105 and L.105)        municipal securities, deposits at banks,       2008:Q2 and selected financial
                                   and nonmarketable U.S. government              asset detail since 2004:Q2.
                                   security issues through 2010:Q3; total
                                   financial assets through 2008:Q2 from
                                   the Census Bureau; breakdown of
                                   financial assets through 2004:Q2 from
                                   the comprehensive annual financial
                                   reports of state and local governments.

7. Federal government              Data from the Monthly Treasury                 None.
   (tables F.106 and L.106)        Statement of Receipts and Outlays and
                                   Treasury data for loan programs and
                                   the Troubled Assets Relief Program
                                   (TARP) through 2010:Q3.
                                                                                                                 5


8. Rest of the world                Balance of payments data through         Balance of payments data for
    (U.S. international             2010:Q2. NIPA estimates; data from       2010:Q3.
   transactions)                    bank Reports of Condition and from
    (tables F.107 and L.107)        Treasury International Capital System
                                    through 2010:Q3.

9. Monetary authority               All data through 2010:Q3.                None.
   (tables F.108 and L.108)


10. Commercial banking              All data through 2010:Q3 for             Data since 2009 for branches of
    (tables F.109 through F.113     U.S.-chartered commercial banks,         domestic commercial banks
   and tables L.109 through         foreign banking offices in the U.S.,     located in U.S.-affiliated areas.
   L.113)                           bank holding companies, and
                                    commercial banks in U.S.-affiliated
                                    areas.

11. Savings institutions            All data through 2010:Q3.                None.
    (tables F.114 and L.114)

12. Credit unions                   All data through 2010:Q3.                None.
    (tables F.115 and L.115)
13. Property-casualty insurance     All data through 2010:Q2. Preliminary    Final data for 2010:Q3.
    companies                       data for 2010:Q3.
    (tables F.116 and L.116)

14. Life insurance companies        All data through 2010:Q2. Preliminary    Final data for 2010:Q3.
    (tables F.117 and L.117)        data for 2010:Q3.
                                    Quarterly data through 2010:Q1;          Form 5500 data since 2007.
15. Private pension funds
                                    Internal Revenue Service/Department      Quarterly data since 2010:Q1.
    (tables F.118 and L.118)
                                    of Labor/Pension Benefit Guaranty
                                    Corporation Form 5500 data through
                                    2007.

16. State and local government      Detailed data through 2008:Q2 from       Detailed data since 2008:Q2.
   employee retirement funds        the Census Bureau; sample data
    (tables F.119 and L.119)        through 2010:Q3 from the Census
                                    Bureau.
17. Federal government retirement   Data from the Monthly Treasury           None.
   funds                            Statement of Receipts and Outlays, the
   (tables F.120 and L.120)         Thrift Savings Plan, and the National
                                    Railroad Retirement Investment Trust
                                    through 2010:Q3.
18. Money market mutual             All data through 2010:Q3.                None.
   funds
    (tables F.121 and L.121)
19. Mutual funds                    All data through 2010:Q3.                None.
    (tables F.122 and L.122)

20. Closed-end funds                                                         None.
                                    All data through 2010:Q3.
    (tables F.123 and L.123)

21. Exchange-traded funds           All data through 2010:Q3.                None.
    (tables F.123 and L.123)
6

22. Government-sponsored       Data for Fannie Mae, Freddie Mac,           None.
   enterprises                 FHLBs, Farmer Mac, FICO, FCS, and
    (tables F.124 and L.124)   REFCORP through 2010:Q3.

23. Agency- and GSE-backed     Data for Fannie Mae, Freddie Mac, and       None.
   mortgage pools              Ginnie Mae through 2010:Q3.
    (tables F.125 and L.125)

24. Issuers of asset-backed    All data for private mortgage pools,        None.
   securities (ABSs)           consumer credit, business loans,
    (tables F.126 and L.126)   student loans, consumer leases, and
                               trade credit securitization through
                               2010:Q3.

25. Finance companies          All data through 2010:Q3.                   None.
    (tables F.127 and L.127)

26. Real estate investment     Data from SNL Financial through             None.
   trusts (REITs)              2010:Q3.
    (tables F.128 and L.128)
                                                                           None.
27. Security brokers and       Data for firms filing FOCUS and
   dealers                     FOGS reports through 2010:Q3.
    (tables F.129 and L.129)

28. Funding corporations       Estimates for this sector are largely residuals and are derived from data for
    (tables F.130 and L.130)   other sectors.