FAIR VALUE OF FINANCIAL INSTRUMENTS

9 Months Ended

Jul. 31, 2011

FAIR VALUE OF FINANCIAL INSTRUMENTS

FAIR VALUE OF FINANCIAL INSTRUMENTS

(15)  The fair values of financial instruments that do not approximate the carrying values in millions of dollars follow:

	July 31, 2011		October 31, 2010		July 31, 2010
	Carrying	Fair	Carrying	Fair	Carrying	Fair
	Value	Value	Value	Value	Value	Value
Financing receivables - net	$  19,437	$   19,439	$  17,682	$   17,759	$  16,236	$    16,322
Financing receivables securitized - net	2,481	2,486	2,238	2,257	2,632	2,650
Short-term securitization borrowings	2,381	2,394	2,209	2,229	2,577	2,600
Long-term borrowings due within one year:
Equipment operations	$         96	$          97	$         40	$          42
Financial services	4,941	5,027	3,214	3,267	$   3,782	$      3,816
Total	$    5,037	$     5,124	$    3,254	$     3,309	$   3,782	$      3,816
Long-term borrowings:
Equipment operations	$    3,372	$     3,789	$    3,329	$     3,745	$   3,182	$      3,595
Financial services	12,521	12,903	13,486	14,048	13,192	13,737
Total	$  15,893	$   16,692	$  16,815	$   17,793	$  16,374	$    17,332

Fair values of the long-term financing receivables were based on the discounted values of their related cash flows at current market interest rates.  The fair values of the remaining financing receivables approximated the carrying amounts.

Fair values of long-term borrowings and short-term securitization borrowings were based on current market quotes for identical or similar borrowings and credit risk, or on the discounted values of their related cash flows at current market interest rates.  Certain long-term borrowings have been swapped to current variable interest rates.  The carrying values of these long-term borrowings included adjustments related to fair value hedges.