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1 MONGJrHL'Y RBVIBW FED ERA L RES E R V E Vol. 37, No.7 BANK o DALLAS, TEXAS F DALLAS July 1,1952 ..Atake United .states .savings Jionds a Part 01 Your .savings Program * There is a place for United States savings bonds in program. Yields consistent with the need for safety and liquidity vary according to the manner in which savings are held or invested. the savings and investment program of every American . * Individuals saved more during the past 12 months than in any other 12-month period since Warld War II, and the current rate of saving continues at a high level. • * ment program, United Statesyour savings and investIrrespective of the size of savings bonds can help meet your requirements. Savings bonds are unexcelled with respect to safety of principal and certainty of return. Savings bonds are readily convertible into cash should the need arise, without risk of market loss, thus providing a high degree of liquidity. Yields on savings bonds are more attractive than ever before. * ferent ways. But may be held orsaver 's inchoice may Personal savings used many difwhatever the be, the fact remains that savings must be held or invested. * Savings may be invested in capital assets either directly, such as in housing, or indirectly, such as through the purchase of corporate securities. Savings may be held in the form of currency or accumulated cash balances in demand deposit accounts. * and takemay formchanneled intoclaims, such as savSavings be savings institutions the of increased ings deposits or shares, or may be used to build equities in pension funds, annuities, and life insurance. Savings may be kept in savings bonds or other United States Government securities. * The needs of each saver and each investor may vary from those of every other. Personal preference for one form of saving or investment over another is important. * There are three considerations, however, which are common to the decisions of most individuals in choosing savings or investment media appropriate to their needs . These are Safety - Liquidity - Yield * A well-planned program includes a satisfactory balance among these three factors. Each is present to some degree with respect to most types of savings and investment. * Safety and liquidity are of overriding importance in most individual C\lses and must be considered in any * There is a type of savings bond to meet the needs of every saver and investor. Purchases of the new Series E bonds through the payroll savings plan are well suited to the programs of regular saving of most individuals. New Series H bands fulfill the requirements of savers for current income, while the new, improved Series J and K bonds are attractive media for other investors. * and intermediaterevisions of savingsyields to together Recent upward in both maturity yields bonds, with increases in the amounts that may be purchased annually, are features to be considered in planning your savings program. * Increased defense spending in the months immediately ahead and the necessity of raising funds to meet those expenditures constitute a problem of considerable magnitude for the Treasury. Moreover, that problem must be considered by each of us as Americans interested in the defense of our Nation and the preservation of the value of our savings. * Help the Nation and help yourself through a carefully planned program of saving that includes the purchase of United States savings bonds. * to purchase the new, more attractive United States Plan your savings and investment program and plan savings bonds. This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) • BoAIUl OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM COMPTROLLER OF THE CURRENCY FEDERAL DEPOSIT INSURANCE CORPORATION NATIONAL ASSOCIATION OF SUPERVISORS OF STATE BANKS AMERICAN BANKERS ASSOCIATION Washington, D. C. June 23, 1952. To the Chief Executive Officer: Your business, and ours, is to help people face financial problems squarely and solve them realistically. This has led to a pay-as-you-go and save-as-much-as-you-can policy during the defense emergency. This policy has paid dividends, --more than IS months of relatively stable prices in the face of rising defense expenditures. As essential spending for our defense continues to rise, maintaining a pay-as-you-go program becomes increasingly difficult. We must therefore continue to encourage the upward trend in savings. This is the people's method of minimizing the effects of inflation. United States Savings Bonds play an important part in the public's savings program. Savings Bonds can be sold and are being sold. Bankers have played an indispensable role in this great thrift program. More than 57 billion dollars are now outstanding, --substantially more than at the end of 1945. About 2 million more payroll savers were Signed up in 1951 by concerted efforts in bU!liness and industry. Sales of small denomination E bonds were up almost 25 per cent in the first four months of 1952. In order to show needed improvement in sales of the larger denominations, we solicit the same effective support by bankers to inform their customers as to the features of the improved Savings Bonds Series E, H, J, and K. The public should be informed that these series now carry improved investment yields which make them more attractive to larger as well as smaller denomination buyers. We endorse the Treasury's new Savings Bonds Program and we urge every banker to enlist personally in an intensified effort to promote the sale of these new and improved bonds. Insuran Comptroller of the Currency prq.& ~SSOCiatl~n NatlOnal of Supervisors of State Banks {o/h~~ President, American Bankers Association F'EDERAL RESERVE BANK OF DALLAS R . R. GILElERT PRESIDENT June 27, 1952 To the Principal Executive Officer of the Bank Addressed: The Federal and State supervisory authorities and the President of the American Bankers Association recently sent you a joint letter, endorsing the Treasury's savings bond program and urging your. personal support in promoting the sale of the new Series E, H, J, and K savings bonds. I should like to take this opportunity to add my unqualified endorsement to their statement. United States savings bonds always have been regarded as being of the highest investment quality, but the new revised series offer even better investment opportunities - both for the individual investor and the institutional investor. Higher yields to maturity, as well as for intermediate periods, and more favorable extension privileges make these bonds more attractive. In the months ahead the Treasury will face financing problems of considerable magnitude. Spending for defense will increase, and the Government will run a budget deficit. If inflationary pressures are to be minimized, the deficit must be financed as largely as possible by the sale of securities to nonbank investors, rather than to banks. Promotion of the sale of savings bonds is an essential part of such a policy. The bankers of the Eleventh District have played an important part in making the savings bond program of the past a really remarkable success. Your assistance in support of the new program is just as essential. I urge your cooperation and ask that you request the officers of your bank to familiarize themselves with the program so that they can inform the people of your community regarding the advantages of savings bonds, first, as a safe, sound, profitable investment opportunity and, second, as an essential part of the Nation's program to finahce its defense in a noninflationary manner. I know that you will accept this challenge and important responsibility. Sincerely yours, uke .New H h'on~ H 801m TlRlIS Aim CONDITIONS _ _ _ _ __ SIMILAIlITJU TO lID • BOIIIl 1.IDteresL _____________ 3.0OS to uturity SIMILARITIES ... 2.lssue date ______________ First day of .onth of purchase 3 .•• turlt1 ________________ 9 years and 8110nths 4.Annual li.it ( .. turity value) ______________ to new E Bond $20,000 5.El1g1ble 6ubscribers _ _ ~]nd1vldua1& 6.Bearer or reglstered ___ ~Reel&tered only ooly 7 .Kegotllbl1 t ty____________ MODe 8.E11C!bl11ty as collateral _______________ NoDe .... H BOIm TERIIS Aim CONDITIOIIS _ _ _ _ _ _ __ DI'FPERElICRS P'ROII nw E DOlfi) H I.Type of bond ___ Accrual 2 . Effe~tLve Current income June I, 1952 date_ May I, 1952 3 . MaturltJ value l issue prtce_ 54 for every $3 ioveated DIFFERENCES Par 4.Rede.p. values_ Incr, each 6 .os. Always at plir 5.0eno_lnatlons __ $25, $50, SlOO , $200, $500, $500, 51,000, $5,000,. SlO,OOO $l,OOO,~ 6.Redeeaabllity__ After 2 $10,000 .as . , After 6 .os . , on 1 110. 'S notice on de .. nd 7.ElItensLon _____ Up to 10 yrs . IIOre None 8.AvailabiUty of new stock __ Old stock tempo- Interi. receipts rarily YIELD COMPARISON OF NEW E AND H BONDS Investment yield Period Held 1/2 )'ur ____ _ _ _ _ __ __ __ _ 1 year ____ _ ___________ _ 3 yoar6 ________________ _ 5 yearS _ ______________ _ 7 years _______________ _ Hew Series E 1.0"" Series H .80\ 1.59 2.25 2.52 2.72 2. 2 1 2.49 2 . 73 3.00 3.00 1.65 9 years and 8 nonths (IIUlturllyL ___________ _ YIELD uke flew $erieJ J and K JJondJ ~_ _ Y1ELDS ON SERIES F AND J BONDS _ _--, For Selected Periods -".::!:'''~-' SERIES J BONDS REPLACE SERIES F BONDS, giving higher intermediate and over-all yields, and •.. SERIES K BONDS REPLACE SERIES GBONDS, ~_ _ with similar increases in yields. YIELDS ON SERES GAND K BONDS _ _--, For SeIIctId Pwrtods Held 9actJ oIbout uke Net r--_ _ _ _ IMPROVED E BOND YIELDS _ _ _ _---., For Selected Period, Held 3.00 INTERMEDIATE YiElDS HIGHER DURING FIRST 9 YEARS, 8 MONTHS AND ................. . CHANGES II! E BOIID TERMS AIID COIIDIT IONS New E Old E NOW YOU MAY BUY EACH YEAR ] ,Maturity_______ Effective 5/1/52 _10 yrs. 9 yrs. • 8 mos. 2.lnle r esL ______ MORE E bonds 2.900, to ma turi ty 3.000, to ma lurl ty 3.Annual l1mlL ___ 510,000 4 .De nomlnations (matur. va lue L. 525, S50, SlOO, $200. $500, With SHORTER maturities At HIGHER yields $20,000 Sl,OOO 5. HedeeN bll i ty 00 demand. ____ .After 6.Availabllity of new stock __ _ __ 60 oays • Same plus $10,000 After 2 month s -_.-- --- --- --- Old stock t e mporarily OffliCt of the Secretary of the lra.aSlJy Offa d "- TdncoI SIoff • t!rteJ ...--_ _ IMPROVED E BOND EXTENSION YIELDS _ _....., . For Selected Periods Held During Extension ~es .... -...-- -."''''- ~ ........................... :......................... 0URING 10·YEAR EXTENDED MATURITY PERIOD E BOND EXTENSIONI_ _ _ _ _ _ _ _ _ _ __ ~ Ilf TERIS AND CONDI T IONS Old exte nsion New extension BUY AND HOLD E BONDS 1. InteresL ______ _2.9()\ to extended 3 . 0()\ IlAturi t7 2.Extended Ma tur ity va l ue per $ 1 00 bond __ $133.33 3 . Applica U an to old E's _ _____ _ . Appll es to outstand!ng E's iSsu e d 5/1 / 4 1 to 4/1 / 42 4 .Curr e nt 1 ncoae bond o p tion _ _ __ _ G bonds redee.able at pa r orla <t tho SeeMory of the fnlosuy Otfa 01 !he T.ari:cI StIff $13 4 .68 To outstanding E'. begin ning with 5/1/42 Iss u es K bonds redeema bl e at pa r To earn MORE During EXTENSION period With improved OPTION 100 MONTHLY BUSINESS REVIEW REVIEW OF BUSINESS, INDUSTRIAL, AGRICULTURAL, AND FINANCIAL CONDITIONS Agricultural conditions in the District generally are very good, although some areas still need more moisture and mois· lure reserves in other areas are becomin g depleted. Harvest of winter wheat and oats has made good progress; yields per acre are very good. Weather has favored the cotton crop, but insect infestations are heavy in some areas. The sorghum grain and peanut, crops are in good con· dition. Fruit production in the District this year will be relatively smalL Han'est of spring vegetables is proceeding satisfactoril y; production estimates for most crops are down from last year. Marketings of cattle have been running 20 percent above last year; marketings of other livestock show littl e change. Farm commodity prices average about 10 per· cent below a year ago. Department store sales in the Eleventh District in May were 14 percent above April and 14 percent above May 1951; average sales per business day were the highest for any May on record. Suspension of credit controls, along with other factors, boosted instalment sales 49 percent above April and 90 percent above the relatively low May 1951 leveL Large percentage gains in sales were scored by television sets, ai r conditioning, laundry eq uipment, and mechanical refri gera. tors. End.of·May inventories at department stores were 12 percent below a year earlier; orders outstanding were 20 per· cent above the low level of a year ago, when merchants were attempting to reduce large inventories. Sales at district retail furniture stores in May registered gains of 38 percent over April and 31 percent over May of last year. Sales of automo· biles in the District have not responded to the easing of credit terms as had been expected. Department store sales in the Eleventh • Federal Reserve District rose durin/! May to thl' higbest monlh ly level for the year to date, showing an increase of 14 per. ren t above Apr il and 14 percent above May 1951. The average doll ar volume of sales per business day in May was the highest for any May on record. When Reglliation W was suspended on May 7, it was the general consensu s in the trade that the suspension of cred it controls would be only moderately stimu lating to department store sales. The figures representing the full month's oper· ations, however, indicate tbat the suspension, together with other factors, stimu lated sales to a considerable degree. Department stores extending instalment credit reported that their instalment sales during May rose 49 percent above April and 90 percent above May of last year. Instalment sales durin g Apri l represented 12 percent of total store sales. which is about the same percentage as during the first quarter. During May, however, that type of credit sales rose to 16 percent of total store sales and accounted for more than 75 percent of the total store in crease over year·ago hgures. 'Charge account sales durin g May were 4 percent above a year ago and rep· resen ted approximately 49 percent of total sales, compared with 52 percent during April. RETAil TRADE STATISTICS (Percentage change) Line af trode b y area DEPARTMENT STORES Totol EJe't'entt. District ••• • • • • •••• •• Corpus Christi • •••••••••• •• •••••. Dallas ••••••••••••• ••• • ••• , •••• EI Poso • • •••.••••.• • ••••• •• ••• . I. Fort Worth •.•• . •••• • • • . .•.• .. •. Houston •••••• •••• •••• , ....•. ••• Son Antonio ••••••••••••••••••• • Shreve port, la . • •. •••••••••••• . •. Waco . •••.•• . •..•••• •• ••• ••• •• Other cities ••••• . •..•••.•••••••• FURNITURE STORES 23 9 10 10 19 20 26 39 8 TOlal Eleventh District ••• ••...•. • •• 31 Austin •••••••• •. •... •••.••••••. Dollal •••••••••••••.•• . • • .•.. •. 85 Houston ••••••• •.•• . •••..•. •. .. . 60 Port Arthur ••• •••• . ••.••.••••. • _ -13 San Antonio ••••• • •• • _ • __••••.. _ 41 Shreveport, Lo ...... . .. .. _• _ •••• _ 11 Wichito Fo ils •••• •••• • •••••••••.. 1. HOUSEHOLD APPLIANCE STORES 19 Totol Eleventh District. •• 0 ••••••••• ·, 001101 ••• • ••••••••••••••••• •• 0 _ 5 May 1952 f rom 5 mo. 1952 compo with 5 mo. 1951 Moy 1951 The recent oil strike caused a loss of an estimated 50,000,· 000 barrels production of refined petroleum products. At the end of May, national stocks of gasoline, kerosene, and distil· late were down 12 to 15 percent as compared with a year earlier; residual fuel oil stocks were off 3 percent. Meanwhile, refineries are attempting to increase production in order to build up the reduced stocks. Crude oil stocks accumulated during the strike to reach the highest level in more than a decade. WeeKly crude oil production in the Eleventh District, having declined since March, was down in the week ended June 14 to the lowest rate since March 1951, except for the strike period. Drilling activity continues at a record leveL STOCKSl NET SALES May 1952 from 14 6 14 -2 9 16 21 27 20 11 38 49 5. 61 16 31 31 9 4 19 -1 3 1 8 5 12 21 -3 Moy 1951 -12 -11 -14 -16 -9 -12 - 12 -1 1 -9 -. -3 -3 -4 -2 -2 9 -5 -5 -. - 17 - 6 - 36 -10 - 28 -7 -20 _ 1 1 - 11 -I 43 28 1 Stocks ot end of month. In the 4 weeks ended June 18, loans at weekly reportin g member banks rose fractionally; about two· thirds of the increase was in the category including co nsumer· type loans. Loans for finan cing security transactions rose almost 4 per· cent, while real estate loans and loan s to banks declined. Investments rose 2 percent, reflecting principally an expansion in holdin gs of Treasury bills, although holdings of Treasury bonds also increased. Demand deposits rose 3 percent; time deposits increased 1 percent. Total resou rces and cash assets also scored gains. I Indicates chon.. o of I." thon one·holf of I percent. Although substantial gai ns over a year ago were recorded in some of the soft goods lines, such 3 S dresses, sportswear, and men 's clothing, the greatest percentage increases were in ohomefurnishings. Furniture and bedding increased 11 per .• cent. Sales of television sets rose 241 percent, while in the. major househol d appliance group, sales of air conditioning units, laundry equipment, and mechanical refrigerators showed increases of 362 percent, 210 percent, and 126 per· MONTHLY BUSINESS REVIEW cent, respectively. On the other hand, sales of radios and phonographs declined 19 percent. • District department store sales through June 1'4 continued substantially above a year ago. Cumulative weekly sales for the year to that date were 4 percent above the comparable period of last year. That compares with a 4,· percent decreasc ror the department sto rcs of the Nation as a whole. INDEXES OF DEPARTMENT STORE SALES AND STOCKS ( 1947-49 = 100) ADJUSTEDl UNADJUSTED Moy 1952 Area SALES-Doily overage Eleventh District .. . . .... . ... Dallas ... .. ............. . . Houston •••••• • •.. •.•.• •• • . STOCKS-End of month Seventh Diuriel .... .....•.. 125 116 141 April March Moy 1952 1952 1951 Moy April Moy March 1952 1952 195 2 1951 114 106 126 105 102 116 118 106r 109 126 120 142 114 109 128 115 108 129 111 110 120 125p 129 131 141 124p 122 124 District retail furniture stores during May registered a 38·pcrcent gain over thc April volume and a 31-percent rise above a year ago. The increase was sharp and was contributed to by the relaxation of down payment and credit terms. Moisture conditions over the District at mid·June generall y were the best in 2 years, although there were some dry areas, notably several South High Plains and Edwards Plateau counties of Texas. Steady winds and growing crops rapidly depleted moisture reserves in the last half of the month, however, and more rain is needed in many areas. Hot, open weather in June favored crop development and permitted farmers to make good progress in planting and replantin g summer crops. Feed crops and pastures made good to excellent growth during the month. 140 WINTER WHEAT PRODUCTION Adjusted for seasonal ... ariotion. r Revised. p Prelimina ry, lin thousands of bushels) The retail value of inventories at department stores at the end of May is estimated at a total slightly under April and approximately 12 percent below stocks on hand at the end of May 1951. The largest percentage reduction of inventories was in homefurnishings, which experienced the largest per· centage increase in total sales. As compared with May of 1951, inventories of furniture and bedding declined 30 per· • cent, and major household appliances fell 49 percent, while , stocks of televi sion sets, radios, and musical instruments were reduced by 31 percent. WHOLESALE TRADE STATISTICS Eleventh Federal Reserve District (Percentag o change) STOCKSlp NET SAlESp May 1952 from May 1952 from 5 mo. 1952 lin e of trode orl.tgs and sundries ...... .... Dry goods ................. Grocery (full.line wholesalers not sponsoring groups) .•. .. Hardwa re ......... ....... . Industrial supplies .. ......... Metals .. ... .. ............ . Tobecco produch ... .. .... . . Wines and liquers .. ........ Wiring 5uppJil!S, construction meterials distributors ... ... 101 Moy 1951 1952 5 mo. 195 1 Moy 1951 1952 -4 -3 -7 - 12 20 -37 I -8 4 5 8 -8 3 20 -8 5 -7 -8 1 -2 _11 14 6 6 15 9 3 -13 -4 3 3 -11 -2 - 12 -6 0 April camp. with 7 - 13 9 -6 April , Stocks 01 end of month. p-Prelimino ry. I lnd1coles change of leu th<ln one·half of 1 percent. SOURCE; United Stotes Bureau of the Census. I The total value of merchandise on order at the end of May was 6 percent above 1 month earlier and 20 percent hi gher than the extremely low level at the end of May 1951. Prior to May of last year, receipts of merchandise had been excep· tionally heavy; the district stock index stood th en 8t141, com· • pared with 108 in May 1950. As a result, new orders were , curtailed until in ven tories could be brought into better rela· tionship with the level of demand. The current volume of stocks on order may be takcn to represent a conservatively optimistic view regarding a continuing high demand. Average 1941-50 Area Arizona .. ................ ........ New Mexico ..................... . Oklohoma ..... .... ...... .. . ..... . Texas ........ ....... , ........... . . . . TOlal ............ .......... . United States .. . ...••.• .• •. . , ..... . 1951 Indicated 1952 3,800 71 ,737 60,347 572 786 575 628 38,902 90,132 136.455 799.977 57.567 645.469 132.867 1.060.296 571 17.307 41,532 SOURCE; United Stales Department of Agriculture. Harvest of the District's winter wheat crop, which began in IIorth Texas about June 1, is well along on the High Plains. Yields are better than were expected earlier in the season. The Texas crop is estimated at 41,532,000 bushels, whi ch is far above last year's small harvest of only 17,000,000 bushels but still below average. The Oklahoma crop estimate is placed at 90,132,000 bushels- more than double last year's production and substantially above average. The New Mexico crop is down from last year, while the Arizona estimate reflects little chan ge. United States production is the largest on record. Harvest of the oat crop in the District was carried forward in June with very good yields. Cotton planting was active in the Hi gh and Low Rolling Plains in June. Warm days favored germination. The crop in the Blacklands, east Texas, and northern Louisiana has made good growth. Light to severe insect infestations are reported in cen tral , eastern, and southern parts of Texas. Official esti· mates of the acreage of cotton in cultivati on will be released July 8; meanwhile, private forecasts indicate a large crop, although the acreage in Texas may be smaller than in 1951. The sorghum grain crop in the District is in good concli· tion in most areas. In the commercial area around Corpus Christi, sorghums began maturin g in carly June, and harvest began about midmonLh. Planting of the later crops On the Hi gh Plains is virtually complete. The peanut crop in southern counties of Texas is growing well. The crop in northern counties is getting ofT to a good start, as rains in late May and early June were greatly beneficiaL MONTHLY BUSINESS REVIEW 102 Ranges and pastures in the District have shown a remarkable improvement since the widespread rains of May and lune_ Moreover, feed grain and hay prospects are generally good. Cattle and calves are gaining on the new grass and are in good condition in most parts of the District. Sheep. on the other hand, still show the effects of the drought. LIVESTOCK RECEIPTS (Number) FORT WORTH MARKET May Class May 1952 1951 Cattle ••....... . ~~,812 3~,350 (1111"'85 ••••••••• • 14,701 60,693 87,3H 10,732 68,972 130,752 Hogs .••........ She.p ......... . SAN ANTONIO MARKET tfs~ May May April 1952 1951 1952 33,719 10,609 83,435 66,120 26,027 13,264 4,202 123,518 18,754 14.019 6.350 18.155 9,013 5,371 120.097 '15,921 l Includes goats. Receipts of cattle on the Fort Worth market in the 4 weeks ended June 14 showed an increase of 89 percent over the comparable period last year; receipts of calves were up 40 percent. Marketings of hogs were off 28 percent, while receipts of sheep and lambs were trailing last year's figures by 14 percent, due to latt<r movement of spring lambs to market in large volume. For the year thus far, marketings of cattle and calves in Fort Worth were up 20 percent compared with a year ago; marketings of hogs and sheep show no significant net change. FARM COMMODITY PRICES and savings notes. At the time of the offering of the bond the Treasury had borrowed $1,600,000,000 through increasing .. the weekly offerings of 9l-dal' bills (by $200,000,000 in ,. excess of maturities) during 8 of the 9 weeks ended June 5. .In addition, the Trcasury had raised about $318,000,000 during May through the offering of 2%,-percent nonmarketable bonds. The preliminary announcement of the offering of the new 2o/s·percent bond was made on June 10, with the announcement giving the approximate term of the secnrity, the amount of the offering, and the method of handling proceeds of sales (deposit of the proceeds in Tax and Loan Accounts was permitted). The Treasury, in its press release of June 12, announced that nonbank subscriptions for the new bond would be accepted without limit and would be allotted in full. It was announced also that subscriptions from commercial banks for their own account would be restricted in each case to an amount not exceeding combined capital, surplus, and undivided profits, or 5 percent of total deposits, whichever was greater; subscriptions for amounts up to and including $100,000 from commercial banks would be allotted in full; and subscriptions for amounts over 5100,000 from commercial banks would be allotted on a percentage basis to be made puhlic at the time of allotment. A linal announcement of the terms of the new bond was made on June 16, giving the coupon rate and the date of maturity. GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS Top Prices Paid in Local Southwest Markets Week ended Commodity and market COnON. MIddling 15/16-inc.h. Oollas ..... WHEAT. N.o. 1 hard, Fort Worth ••••••.•.• OATS, No.2 whit •• Fort Worth ••...•.••.• CORN, No.2 yellow,.!, Fort Worth ....•••• SORGHUMS, No.2 yellow milo, Fort Worth. HOGS, Choice. Fort Worth ....•. ......•• SLAUGHTER STEERS, Choice, Fort Worth . .• SLAUGHTER CALVES, Choice, Fort Worth... STOCKER STEERS, Choice, Fort Worth ••••. SLAUGHTER LAMBS, Choice. Fort Worth .•• HENS, 3·.4 pounds. Fort Worth .......••.• FRYERS, Commercial, Fort Worth ••••••...• BROILERS. South Tuas .................. EGGS, CUfrent Receipts, Fort Worth ••••••• TURKEYS, No.1 hens, Fort Worth •••••• . . • Eleventh Federa l Reserve District Comparable Comparable week week Unit June23,1952 lad month lb. bu. bu. bu. cwt. cwt. cwt. cwt. cwt. cwt. $ .4010 2.4BV2 1.061A 2.16l<\ 3.25 20.75 33.50 34.50 30.00 lb. lb. lb. 25.50 .19 .30 .29 case 12.50 lb. .28 (Averages of doily ftgurel. In thousands of dollars) S .3860 2.68Yo. 1.06l<\ 2.19 3.32 22.00 35.00 35.00 35.00 29.50 .19 .29 .28 10.50 .2 8 COMSINED TOTAL lost yeor $ .4477 2.60Y, 1.0.4'12 1.98l<\ 2.60 22.75 36.00 36.50 37.00 33.50 Farm commodity prices in the District continue to average below a year ago. Prices of individual commodities, meanwhile, are showing divergent trends. During late May and most of June, prices of cotton, wool, and poultry advanced, while most classes of livestock and some grains suffered losses. The Treasury borrowed approximately $-1 .,249,000,000 of new money in June through the offering of a 2%-percent intermediate-term bond dated Jul y 1 and maturing June 15, 1958. The new marketable bond was offered to investors for cash on June 16; subscription books clo~ed the same day_ The completion of that financing program increased the amount of new money borrowed by the Treasury during April, May, and June to a total of approximately $6,167,000,000, exclusive of the sales of savings bonds Dote Gross demand nmo RESERVE CITY BANKS Gross demond COUNTRY BANKS Gross Time demand Time May 1950 ...... 55,481,505 $670,514 $2,627,316 $423,42 8 $2,854,189 $247,086 May 1951 •..... 5,801,415 January 1952.... 6,779,455 February 1952 ... 6,567,846 Moren 1952. . . .. 6,513,810 April 1952... . .. 6,451,803 May 1952 •.. • .. 6,329,241 658,973 714,332 72 1,578 719,84.4 73j,170 736.861 2.697,033 3,162,301 3,030,813 3,046,289 3,021,143 2.959,228 362,380 391,577 395,992 392,193 401,280 403,137 3,104,382 3,617,154 3,537,033 3,467,521 3,430,660 3,370,013 296,593 322.755 325,586 327,651 332,890 333,724 The step-by-step procedure of announcing the offering permitted the market to adjust to the anticipated new supply of marketable securities. Prices of the taxable bank-eligible bonds of intermediate maturity declined by 8/32 to 15/ 32 following the arnlOuncement of June 10. Further moderate adjustments in the prices of those issues occurred during the remainder of the week. Decreases in closing prices between June 10 and June 16 ranged from 8/32 to 17/32, with the 2%'s of March 15, 1957-59, showing the greatest change. At the close of the market on J line 19, the bid price of the new 2%-percent bond (on a when-issued basis) was 100 14/32. Total subscriptions for the 2%·percent bonds were more than three times the amount of the offering, with nonbank subscriptions alone amounting to $3,642,000,000. In accordance with the Treasury's announcement of June 12, nonbank4 subscriptions were allotted in full. Subscriptions of commercial banks up to $100,000 were allotted in full; commercial banks subscribing to more than that amount were allotted $J 00,000 each. Total allotments amollnted to approximately MONTHLY BUSINESS REVIEW sentin g cash subscriptions. Private investors accounted fOJ 71 percent of the cash su bscriptions, with Treasury invest· ment accounts supplying the remainder_ BANK DEBITS, END -Of-MONTH DEPOSITS AND ANNUAL RATE Of TURNOVER Of DEPO SI TS (Am ounts In thousond, af dollars) DeBITSl DEPOSITS' PercenlClge chonge from Mgy City 1952 ARIZONA Tvcson ...... . ....... $ LOUiSiANA Monroe . ....•... .. . . Shreveport . •......• . HEW MEXICO Roswell .••.•••.•••• • 98,877 IA 18 22,312 13 16 Beaumont •••. .. • . •• . Corpus Chrilti ...... . . Corsicana •••.•••••• • 0 0110$ .•. ••••••••••• EI P050 .•. .......... Fort Worth ... . . . ... Galveston . .. ....... HoustOfl • ••..••..• •• Laredo ..... . . .. . . . . . . . lubbock . .... . .... . . Port Arthur . . ....... . San Angelo ...... .. . . San Antonio .. • .. . ... Texarkana' ... . ... .. . Tyl&r .... . ... . .. " .. Waco." ... . . . ,' , .. Wichita Falls ........ . 70,259 82,887 10101-24 cities . . ...... $5,585,995 6 8 19 6 5 3 12 12 -I 25 17 -9 -8 4 17 18 2 11 9 May May April 1952 1952 1951 1952 11.2 10.2 10.7 7 53,664 136,62A 138,287 123,231 137,264 1 1,962 1,438,900 170,074 5 15,770 83,554 1,598,549 27,621 101,336 36,623 39,95A 378,918 20,621 56,565 Annual rQI. of turnover May 3 1, 104,910 22 46,00 2 196, 141 TEXAS Abilene .... .. . .... • . Amarillo ••••••• •.• ,_ Austin . . . . . . . . . . . . . . April 195 1 1952 May 48,0 14 -1 4 201,935 26,706 4 -20 -1 5 54,559 114,232 121,891 96,892 106,242 23,159 1,000,144 145,795 410,050 101,688 1,1.44,427 26,031 99,465 43,036 2 384,632 -1 -4 2 -6 1 -5 6 -1 , 19 - 6 -2 50,238 25,516 -2 -7 54,944 85,243 105,278 2 10 $4,575,027 11.5 10.8 11.5 10.1 10.3 10.0 11.6 10.8 11.3 11.8 11.5 11.3 14. 3 14 .5 14.3 13.8 14.2 17.9 15. 1 15.6 6.4 17.3 14.2 15.5 9.8 16.7 13.1 12.4 10.0 9.6 11.9 9.7 12.5 9.8 9.5 14.6 15.6 14.8 6.5 18.1 15.1 15.6 10.1 15.8 12.6 11.3 1 1.8 10.3 11.9 8.8 11.3 10.6 9.5 14.6 14.8 9. 8 16.4 11.6 12.8 11.4 9.4 1 1.6 10.1 11.4 9.8 10.2 14,6 • 54,249,000,000, or about $749,000,000 In excess of the amount of the original offering_ Subscription and allolment figures were announced by the Secretary of the Treasury Jun e 19, On June 10, at the time of the preliminary announcement of the offering of the inlermediate bond, the Secrelary of the Treasury also announced that holders of the 1%-percent certificates of indebtedness which mature July 1 in the amo unt of $5,216,000,000 would be offered (on June 16) a new 1%percenl certificate in exchan ge for their holdings. The refunding security is dated July 1 and matures June I , 1953, The Treasury announced on J une 5 the subscri ption and allotmenl f'gures with respect to the offering of additional amounts of the 2%,-pereenl Treasury bonds, Inveslment Series B-1975-80, for cash and in exchange for the 2Y2-percent Treasury bonds of 1965-70, 1966-71, and the two restricted issues of 1967-72, Total subscription s amounted to $1,757,760,000, with $450,400,000 of that amount repreCONDITION Of THE fEDERAL RESERVE BANK Of DAllAS (In thousands of dollars) June 15, • Tota l gold cartiReate reserves .. , ............ Discounts for member bonks ... ........•. . .. Industrial advances, .... . . ... . ........•.... Foreign loans on gold ..... . , .. . . .. . ..•.... U. S. Government securities . . ............... T0101 earning osseh, . . . .. .. . . ............. Member bank reserve deposits. , ......... . .. Federal Reserve nates in actual circulation ... . . June 15, 1952 195 1 $ 727,499 $ 492,144 6,700 2,461 40 4 304 0 1,021,442 1,098,578 1,028,450 1,101,079 998,572 928,022 694,808 628,2 12 May 15, 1952 $ CONDITION STATISTICS Of WEEKLY REPORTING MEMBER BANKS IN LEADING CITIES El eventh Federal Reserve District 15.4 15.2 7 .0 17.2 14.9 1 De bits to de posit accoun" except int&rbank accounts. 2 Demond and time dep01its. including certified a nd officers' checks outstanding but excluding deposits to the credit of bonks. s The5e f'Igures include only one bonk In Texarkana, Texas. Total debits for all banks in Te xarkana, Texas·Arkansas, including two banks located in the Eighth DIstrict. amounted to $39,580,000 for the month o f May 1952. , Indicates change of len than one-hal f of 1 percent . Item Between May 21 and June 18, most major categories of assets and liabilities of the weekly reporting member bankE in the Distri ct rose. The more notable changes included increases in total resources, cash assels, and deposits. On June 18, total resources of lhese banks amounted to $4,314,534,000, refleetir1g an increase of about 3 percent during the 4-week period and 12 percent during the preceding 12 months, 678,790 5, 100 5 38 1,022,840 1,027,983 987, 167 681,747 (In thoulclnds of daUa rs) Item June 18, 1952 Total loa ns (grolS) and investments •...... . ... $2,909,040 Totalloans-Net1•• •• • •••• , ••••••••• " . , 1,538,494Total loon s-Gross . ... , .... , . • . .... , .... 1,5 54,987 Commercial, in dustrial, and agricultural loans .......... . .... . ...... , ... , .. 1.0-46,637 9,899 loons to brokers and dealers in securities .. Other loan' for purchasing or carrying 61,454 securities, . ..... . ... . ...... .. . , ... . Real estate loans. , . . ....... . .. ...... . 114,588 10,768 Loons to banks ...... . ... . . ........... All other loans ........... . ......•... . 311,641 1,354,053 Total inVestments ....................... U. S. Treasury bills ............. , .... , . 214,126 165,127 U. S. TreallKY certificates of in debted ness. U. S. Treosury notes ................... 177,028 U. S. Government bands (ind uding guar· 627,630 anteed o bligations) .... .. .. ... ...... 170,142 Other securities •. .. ... .. .............. 557,968 Reserves with Federa l Reserve Bonk . . ........ Balances with domestic bon ks .... .......... . 447,848 Demand deposils-odiusted s.............. .. 2,376,777 467,453 Time deposits eltcepl Government . . .......... 88,216 United States Government deposits ...•.. . .... Interbank d emand deposits .. , ..... . ... .. .. . 753,354 14,500 Borrowings from Federa l Reserve Bonk •.• . . . .. June 20, May 2 1, 1951 1952 $2,628,076 $2,877,078 1,444,361 1,531 ,258 1,461,072 1,547,696 1,000,283 1,045,586 8,412 8,381 57,228 60,488 , 15,062 122,443 1,245 11,325 271,461 306,854 1,167,004 1,329,382 88,263 195,213 80,688 169,959 259,251 177,363 574,297 613,488 16.4,505 173,359 550,590 570,87 1 351,975 389,006 2,209,992 2,348,558 -441,451 463,86 1 86,631 91,862 601,751 705,023 10,250 0 1 After deductions far reserves and unalloca ted charge-offs. S Includes all demand d e posits othe r than Interbank and United States Government, less cdsh items reported a s on hand o r in process of collectIon. Loans rose $7,291,000, or less than one-half of 1 percent, during the 4 weeks. Approximately two-thirds of that increase occurred in the category "all other" loans, which includes consumer- lype loans_ Loans for financing security transactions rose almost 4 percent, while real estate loans and loans to banks declined. The declining trend of commercial, industrial, and agricu ltural loans which prevailed during most other weeks of this year was reversed temporarily, with loan s of that type showing a fractional increase_ Increases in loans to commercial and industrial borrowers, such as sales finance companies, construction firms, and manufacturers of petroleum and related products, were more than ofTsel by decreases in loans to commodity dealers, wholesale and retail trade establishments, and grain and milling concerns_ Inveslments of the weekly reporting member banks rose $24,671,000, or 2 p~rcent, during the 4 weeks ended June 18, with the expansion in holdings of Treasury bills accounling ror most of the change. Investments in Treasury bonds increased, while holdings of certificates, notes, and non-Government secu rities declined, Deposit trends included increases of $107,751,000 in demand deposits and S3,592,000 in time deposits, or 3 percent and 1 percent, respectively, Approximately equal increases in MONTHLY BUSINESS REVIEW 104 deposits of individuals, partnerships, and corporations and interbank deposits accounted for about 90 percent of the expansion in demand deposits. Time deposits of individuals and bu sinesses rose somewhat more than total time depo sils. States total, compared wilh only 9 percent a year ago. On the other hand, nonresidential awards, totaling $84,000,000, showed a decrease of 10 percent from the previous month . and were 17 percent below May 1951. In May they accounted for 11 percent of the United States total, as compared with 9 percent a yea r ago. NEW PAR BANK The oil industry faces an unbalan ced situation in refined and crude stocks, which developed during the recent strike. The strike caused an estimated national loss of production of 50,000,000 barrels of refined petroleum producls. Primary stocks of the four major refined products declined over 33,· 000,000 barrels during the 5·week period ended May 31, a decrease of roughly 950,000 barrels a day. Normally, refin ed stocks would have risen appreciably during this period. The Haltom City Bank, Haltom City, Texas, a newly organized, insured, nonmember bank, located in the territory served by the head office of the Federal Reserve Bank of Dallas, was added to the par list on its opening date, May 24, 1952. The officers are: E. P. Haltom, Chairman of the Board; J. Allen Rhodes, President; H. B. Seale, Executive Vice President ; S. M. Payne, Assistant Vice President; and Grant Owens, Cashier. The value of construction contracts awarded in the Di strict during May totaled $178,000,000, which is 24 per· cent greater than in the previous month and 11 percent above a year ago; a rise in residential awards more than offset a decline in nonresidential awards. Residen· tial awards of S93,000,000 were up 88 percenl from April and were 58 percent over the year·ago figure. In May, residential awards in the District accounled for 12 perccnl of the United VALUE OF CONSTRUCTION CONTRACTS AWARDED (In thousands of dollars) January-May May Area and type May April 1952p 1951 1952p 1952p 1951 143,905 49,581 94,324 1,597,517 681,614 915,903 $ 628,824 $ 707.521 6,299,728 2,792,245 3,507,483 7.404,677 ElEVENTH DISTRICT .. $ 177.955 93,294 Re$idential • . .. . .. 84,661 All other .••...... UNITED 51 ATESl .... 1,593,660 Residential ••••••• 783,755 All other •........ 809,905 160,385 58,9 0 3 101,482 2,572,961 661,094 1,911,867 258,923 369,901 305.04 6 402,475 p_Prellmlnary. SOURCE, f . W. Dodge Corporation. BUILDING PERMITS 5 months 1952 Moy April Percentage chonge in va luation f rom 5 months 1951 1952 _ _ !:.M~c~y~I~9~52~~M;;-;-A.;;;;- Numbe r LOUISIANA Shreveport . •. . Voluation Valuation -38 425 $ 1,285,032 TEXAS 188 Abilene ... ... . Amarillo ••... . 381 234 Austin ..•.... . 232 Beaumont . .... Corpus Christi .. 399 1,958 Dallas ....... . 281 EI Paso . ...... Fort Worth . .. . 1,048 Galveston .... . 120 Houston ...... . 1,040 lubbock . ..... 270 Port Arthur . •.. 299 San Antonio . .. 1,539 360 Waco ....... . 51 Wichita faIl 5.. . 1.825 $ 10, 168.789 31 1,707.660 1,830,261 1,684,015 377,327 1,307,476 12,147,000 865,703 5,628,597 1,029,745 9,030,288 1,583,903 310,720 3,516,958 967,750 1,722,261 543 59 6 - 14 31 95 - 11 45 622 _ 8 18 - 44 25 - 36 352 59 - 35 - 52 - 79 5 31 -3 17 596 _22 _17 - 18 _11 - 42 71 750 1,957 1,301 1,221 1,907 9,275 1,576 4,852 585 4,848 1,4 13 957 6,922 1,775 653 .4,801,349 11,279,000 13,190,374 4,607,6 12 7,036,734 .41,694,470 8,329,707 21,199,112 1,953,207 45,417,472 7,539,938 1,338,949 18,285,747 7,148,681 13,880, 205 33 11 11 55 -38 -14 10 -20 24 -34 - 8 -28 -1 3 Total ........... 8,825 $44,994,696 35 - 7 41,817 $217,871,346 -10 I While the oil strike was reducing refined slocks, crude oil stocks were accumulating to reach the highest level in more lhan a decade. Crude oil stocks in the Nation on May 31, near the end of the strike, amounted to 288,000,000 barrels. This rep,"eSents an increase of 23,200,000 barrels over the pre· strike dale of April 26; the major portion of this gain was in the Eleventh Federal Reserve District, where stocks rose 17,. 100,000 barrels. As compared with a year earlier, national stocks at the end of May were up 39,900,000 barrels, with dis· trict stocks up 26,300,000 barrels. 1951 Percentage change in valuation from Number Refineries are attempting to increase production in order to build up the reduced stocks. Nevertheless, since a high level of refinery oUlput is necessary to meet current demands, the rebuilding of refined stocks may be extended over a fairly long period. It is estimated that to regain the 50,000,000 barrels lost during the strike will require an increase in crude • runs to refinery stills of about 165,000 barrels daily through the first quarler of next year. The immediate task of the industry is the maintenance of adequate supplies of gasoline dllring the heavy consumin g season of the next few months, but refineries must also make up the loss of home heating fuels to insure sufficient supplies next winter. 2.778,575 4,626,102 I 37 dotes eost of the Rocky Mountains. City On May 31, national stocks of gasoline in primary slorage were about 17,500,000 barrels, or 12% percent, lower than a year earlier. Kerosene stocks were do wn over 15 percent, and distillate, more than 13 percent. Residual fuel oil stocks, however, showed a decline of only a little over 3 percent as compared with a year ago. These decreases in stocks were widely distributed over the Nation. Indicates change of leu than ane·hclif of 1 percent. ; 288 The unduly high level of crude oil stocks was in Slrumental in the Texas Railroad Comm ission' s action reducing July oil allowables. This cut represents the fourth consecutive monthly reduction in allowables and brings allowables down to the lowest level since January 1951. Crude oil production in the Eleventh District, largely reflecting the cut in Texas allow· ables, has declined nOliceably from the March peak and in the week ended June 14 was at the lowest rate since March 1951, except for the period of the strike. The daily average production for that week was 2,987,000 barrels, or about 77,000 barrels below the daily average production of June a year ago, 4