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Fair Value Disclosures (Tables)
9 Months Ended
Sep. 30, 2018
Fair Value Disclosures [Abstract]  
Assets and liabilities measured on a recurring basis at fair value
Assets and liabilities measured on a recurring basis at fair value, primarily related to Financial Products, included in our Consolidated Statement of Financial Position as of September 30, 2018 and December 31, 2017 are summarized below:
 
September 30, 2018
 (Millions of dollars)
Level 1
 
Level 2
 
Level 3
 
Measured at NAV
 
Total
Assets / Liabilities,
at Fair Value
Assets
 

 
 

 
 

 
 
 
 

Debt securities
 

 
 

 
 

 
 
 
 

Government debt
 

 
 

 
 

 
 
 
 

U.S. treasury bonds
$
9

 
$

 
$

 
$

 
$
9

Other U.S. and non-U.S. government bonds

 
48

 

 

 
48

Corporate bonds
 

 
 

 
 

 
 
 
 

Corporate bonds

 
710

 

 

 
710

Asset-backed securities

 
61

 

 

 
61

Mortgage-backed debt securities
 

 
 

 
 

 
 
 
 

U.S. governmental agency

 
290

 

 

 
290

Residential

 
7

 

 

 
7

Commercial

 
14

 

 

 
14

Total debt securities
9

 
1,130

 

 

 
1,139

Equity securities
 

 
 

 
 

 
 
 
 

Large capitalization value
298

 

 

 

 
298

Smaller company growth
65

 

 

 

 
65

REIT

 

 

 
117

 
117

Total equity securities
363

 

 

 
117

 
480

Derivative financial instruments, net

 
22

 

 

 
22

Total assets
$
372

 
$
1,152

 
$

 
$
117

 
$
1,641

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
December 31, 2017
 (Millions of dollars)
Level 1
 
Level 2
 
Level 3
 
Total
Assets / Liabilities,
at Fair Value
Assets
 

 
 

 
 

 
 

Debt securities
 

 
 

 
 

 
 

Government debt
 

 
 

 
 

 
 

U.S. treasury bonds
$
10

 
$

 
$

 
$
10

Other U.S. and non-U.S. government bonds

 
42

 

 
42

Corporate bonds
 

 
 

 
 

 
 

Corporate bonds

 
584

 

 
584

Asset-backed securities

 
67

 

 
67

Mortgage-backed debt securities
 

 
 
 
 

 
 

U.S. governmental agency

 
261

 

 
261

Residential

 
8

 

 
8

Commercial

 
17

 

 
17

Total debt securities
10

 
979

 

 
989

Equity securities
 

 
 

 
 

 
 

Large capitalization value
284

 

 

 
284

Smaller company growth
56

 

 

 
56

REIT

 

 
110

 
110

Total equity securities
340

 

 
110

 
450

Total assets
$
350

 
$
979

 
$
110

 
$
1,439

Liabilities
 

 
 

 
 

 
 

Derivative financial instruments, net
$

 
$
19

 
$

 
$
19

Total liabilities
$

 
$
19

 
$

 
$
19

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fair values of financial instruments
Please refer to the table below for the fair values of our financial instruments.
 
 
 
Fair Value of Financial Instruments
 
 
 
 
 
 
September 30, 2018
 
December 31, 2017
 
 
 
 
(Millions of dollars)
 
Carrying
 Amount
 
Fair
 Value
 
Carrying
 Amount
 
Fair
 Value
 
Fair Value Levels
 
Reference
Assets
 
 

 
 

 
 

 
 

 
 
 
 
Cash and short-term investments
 
$
8,007

 
$
8,007

 
$
8,261

 
$
8,261

 
1
 
 
Restricted cash and short-term investments
 
$
39

 
$
39

 
$
194

 
$
194

 
1
 
 
Investments in debt and equity securities
 
$
1,619

 
$
1,619

 
$
1,439

 
$
1,439

 
1, 2 & 3
 
Note 8
Finance receivables – net (excluding finance leases 1)
 
$
14,815

 
$
14,764

 
$
15,452

 
$
15,438

 
3
 
Note 16
Wholesale inventory receivables – net (excluding finance leases 1)
 
$
1,194

 
$
1,168

 
$
1,153

 
$
1,123

 
3
 
 
Foreign currency contracts – net
 
$
13

 
$
13

 
$

 
$

 
2
 
Note 5
Interest rate contracts – net
 
$
7

 
$
7

 
$
1

 
$
1

 
2
 
Note 5
Commodity contracts – net
 
$
2

 
$
2

 
$
21

 
$
21

 
2
 
Note 5
 
 
 
 
 
 
 
 
 
 
 
 

Liabilities
 
 

 
 

 
 

 
 

 
 
 
 
Short-term borrowings
 
$
4,521

 
$
4,521

 
$
4,837

 
$
4,837

 
1
 
 
Long-term debt (including amounts due within one year)
 
 

 
 

 
 

 
 

 
 
 
 
Machinery, Energy & Transportation
 
$
8,001

 
$
9,155

 
$
7,935

 
$
9,863

 
2
 
 
Financial Products
 
$
23,251

 
$
23,110

 
$
22,106

 
$
22,230

 
2
 
 
Foreign currency contracts – net
 
$

 
$

 
$
41

 
$
41

 
2
 
Note 5
Guarantees
 
$
8

 
$
8

 
$
8

 
$
8

 
3
 
Note 10

1 
Total excluded items have a net carrying value at September 30, 2018 and December 31, 2017 of $7,481 million and $7,063 million, respectively.