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REVIEW
FEDERAL RESERVE BANK OF RICHMOND
R I C H M O N D 1 3, V I R G I N I A

J U N E 3D, 1 9 4 8

Business Conditions

I

N a national setting, generally appraised in an optomistic vein, business activity in the Fifth Federal
Reserve District presents some notable contrasts. Out
of twenty available business indicators for May seven
show improvement over April on a seasonally adjusted
basis, twelve were lower and one was unchanged.
Furthermore industrial operations have worsened in
several lines, notably in cotton textiles, hosiery, and
work clothing. Trade levels seasonally adjusted are gen­
erally lower in May than in April with opposing trends
shown in such wholesale lines as automotive and indus­
trial supplies, and electrical goods. Smaller amounts of
new insurance were written in May than in April and
time deposits of member banks continued to fall for the
third consecutive month. Farm income during the first
four months of the year was 7 per cent smaller than in
those months last year. Coal production in May was up
sharply from April, but still failed to equal the output
of May 1947, which was due mainly to car shortages.
Building construction remains the strongest factor in
the District’s economy despite a drop of 18 per cent in
permits from April to May after seasonal adjustment.

Figures for department stores thus far available by
the departments do not show many significant declines
in dollar sales. There are, however, an increasing number
of departments in which sales trends, again in dollars,
have been flat for a year or more. Even those depart­
ments which have contributed most to the total store
increases over the past year or more are experiencing a
leveling off.
Furniture store sales in May dropped 2 per cent from
the April level on a seasonally adjusted basis, but re­
mained 4 per cent higher than a year ago. Seasonally ad­
justed sales in the 5 months ended May 1948 were 6 per
cent lower than in the last quarter of 1947. In the de­
partment stores which report departmentally, furniture
sales have been in a flat trend since the spring of 1946.
These stores normally handle a somewhat higher quality
of furniture than most of the furniture stores reporting
in our larger sample. It would seem that the trends shown
by these two sets of figures would indicate that the lower
priced furniture sales continued to expand through 1947
and have since slid off whereas demand for better grade
furniture has held up comparatively well.

Trade

Textiles

Department store sales nationally established an all
time high seasonally adjusted figure in May at 308 per
cent of the 1935-39 average. The high point in the Fifth
District was in December 1947 at 322 per cent of the
1935-39 average. While the national index was rising
from 303 in April to 308 in May the Fifth District index
was falling from 321 in April to 313 in May, a drop of
2 per cent. Department store stocks in the District de­
clined 3 per cent meanwhile and since dollar stocks are
more than three times as large as sales this drop may be
evidence of a cautious merchandising policy and an at­
tempt to adjust inventories downward. It has been
learned from selected stores that much the same policy
is still in evidence at mid-year.
It is probably correct to say that the gain in income
payment in the Fifth District has been less rapid in 1947
and thus far in 1948 than for the country as a whole. It
must also be noted that the level of department store
sales in the Fifth District in May at 313 per cent of the
1935-39 average was still higher than the national figure
at 308 per cent of the same base period. Perhaps these
are indications that the trade level of the country is
catching up with the District and that the District is no
longer rising as rapidly as the national total.

Cotton consumption and spindle hours run by the
mills of the Fifth District declined 5 and 4 per cent re­
spectively on seasonally adjusted basis from April to
May. This has been the result of a run-off of order back­
logs, and a cautious purchasing policy on the part of
both converters and cutters, which in turn is an out­
growth of similar caution exercised by wholesalers and
retailers; by the loss in exports; and by the elimination
of demand for inventory building.
There has been very little new business written by
the mills since the turn of April and the price structure
has considerably weakened. Here in the latter part of
June there are just a few indications that goods and
yarn prices will level off and that some forward con­
tracting may not be far removed. However, with re­
tailers committing for only a part of their fall require­
ments it would seem that mill activity would be slow in
resuming after the vacation period which is concentrated
largely in the first two weeks of July. If the mills do re­
duce operations this summer to conform with their
orders booked, and do not produce for inventory, it is
probable that some strength may again be seen in cotton
textile prices this winter. Demand at the retail level will
probably hold steady in the Fall months particularly




FEDERAL RESERVE BANK OF RICHMOND

RFC. This provision together with FH A insurance un­
der Title II makes it possible that sale of individual
homes can be effected without too much difficulty.
Financing of rental projects, however, will require pri­
vate funds, but since the tension in the money market
evident in the early part of the year has relaxed, private
funds for rental developments may sustain the volume
of operations.

when the lower price of goods finds its reflection in
fiuished prodncts. Lower cotton prices seem probable
this fall and winter as the situation now appears and
this important element of cost may act as an offset to
possible strength in goods and yarn prices under condi­
tions as indicated.
Construction
Although building permits in the Fifth District in
May on a seasonally adjusted basis declined 18 per cent
in value from April they were still 30 per cent higher
than in May 1947 and 177 per cent above the 1935-39
average. Construction contract awards, which have
shown a flattening-off tendency this year, were 230 per
cent higher in May than the 1935-39 average and 24 per
cent above May last year. The construction volume is
the strongest factor in the Fifth District economy at the
present time and constitutes the major share of the new
capital formation of the District.
Home loans in the Fifth District insured by the Vetereans Administration turned up slightly in May after
many months of showing steady declines. This was be­
fore the Congress had passed a bill providing some ac­
cess by lenders to a secondary mortgage market in the

Conclusion
On an overall basis the business situation in the Fifth
Federal Reserve District can best be characterized as
easier. Trade levels have not been as good as in the na­
tion as a whole. Seasonally adjusted department store
sales in May held or rose moderately above April levels
in Virginia and the Carolinas but declined in Maryland,
District of Columbia and West Virginia. Employment
levels in manufacturing industries, aside from seasonal
industries, have shown only minor recessions on an
overall basis, while construction employment has con­
tinued to rise.
The employment level in some manufacturing indus­
tries has not given a good indication of factory operaContinued on page 6

BUSINESS IN DEXES—FIFTH FEDERAL RESERVE DISTRICT
AVERAGE DAILY 1935-39 = 100—SEASONALLY ADJUSTED

May
1948

Automobile Registration5' ............................
1
Bank Debits........................-.............................
Bituminous Coal Production*.......................
Building Contracts Awarded.........................
Apartments and Hotels..............................
Commercial Construction Contracts.......
Manufacturing Construction Contracts..
One and Two Family Houses.....................
Public Works and Utilities.......................
Residential Constiuction Contracts.........
Building Permits Issued ..............................
Business Failures—No...................................
Cigarette Production......................................
Cotton Consumption ......................................
Department Store Sales..................................
Department Store Stocks..............................
Electric Power Production............................
Employment—Mfg. Industries*...................
. Furniture Orders............................................
Furniture Shipments......................................
Furniture Unfilled Orders..............................
Furniture Sales—Retail ................................
Gasoline Consumption....................................
Life Insurance Sales........................................
Wholesale Trade:
Automotive Supplies**.............................
Drugs ...........................................................
Dry Goods...................................................
Electrical Goods** ...................................
Groceries .....................................................
Hardware ...................................................
Industrial Supplies**.................................
Paper and Its Products**..........................
Tobacco and Its Products**......................

326
182
366

314
277
31
226p
148
314
337

265p
252
408
253
172
89
262
138
387
153
92

*Not seasonally adjusted

**1938-41 = 100




[2]

Apr.
1948
129
313
102
324r
872
382
268
321
266
421
336
40
271r
156
321
340
256
135
313
311
1211
270r
261
339
269
171
83
262
142
358
167
99

Mar.
1948
140
320
91
326
173
304
498
378
316
290
274
51
248
153
317
340
265
136
320
307
1001
265
179
246
341
265
184
83
247
140
317
155
87

May
1947
131
290
188
264
215
342
478
206
460
215
213
14
216
139
301 r
292
235
132
235
268
913
256
173
238
296
244
154
90
266
126
341
191
109

% Change

May 1948 from
Apr. 48
May 47
-J- 4
+ 78
+ 13

+ 12
— 3
+ 39

— 25
— 18
— 23
— 17
— 5
— 2
— 1

+ 46
30
+121
+ 5
+ 6
+ 4
+ 15

— 2
— 3
+ 20
— 6
+ 1
+ 7
0
— 3
+ 8
— 8
— 7

+ 4
+ 6
+ 38
+ 4
+ 12
— 1
— 2
+ io
+ 13
— 20
— 16

MONTHLY REVIEW

JUNE 1948

Retail Credit Survey
In 1947 disposable personal income of the American
people amounted to $175.3 billion, a gain of $16.9 bil­
lion over 1946. Personal consumption expenditures
amounted to $164.4 billion, a gain of $20.7 billion over
1946. This larger gain in personal consumption expendi­
tures than in disposable income caused a reduction of
$3.9 billion in computed personal savings during 1947.
Also finding reflection in the personal consumption
expenditure figure in 1947 was a gain of $3.2 billion in
consumer instalment credit of which $1.8 billion repre­
sented a direct sales-increasing factor in the form of in­
stalment sale and charge account credit, and $1.4 billion
represented other consumer credit which may have in
part affected retail sales directly or indirectly by aug­
menting income of the borrower or the recipient of the
borrowed funds. In addition to reduced savings by some
people and larger use of credit by others, there was also
the addition of $5.1 billion of purchasing power for
some in the cashing of savings bonds and for still others
in the expenditure of an unknown portion of their other
liquid asset balances. The visible figures alone add to a
total of $12.2 billion or more than half of the increase
in consumer purchases.
Credit was an important factor in augmenting the
$20.7 billion increase in 1947 over 1946 of consumer
purchases, and the impact appears to be more effective
on the $17.1 billion gain in durable and non-durable com­
modities rather than in services. It might be contended
that had no increase in consumer credit been made dur­
ing 1947 sales of goods and services would have gained
$20.7 billion anyway by the alternative use of liquid as­
sets. This contention cannot be completely rejected, but
it would seem reasonable to suppose that there may have
been many consumers who did not have liquid assets or
were not willing to part with their liquid assets, but who
nevertheless were able to purchase goods and services
on credit.
Although receivables are expanding and collections
are slowing down, there is nothing thus far in the retail
credit situation that is of itself a cause for alarm. In fact
the use of credit in retail trade is considerably less im­
portant than in prewar years. This of course does not
deny that credit had an important part in expanding re­
tail trade in 1947.
Retail Credit Survey Data
The 1947 annual Retail Credit Survey conducted by
the Federal Reserve Bank of Richmond is based on data
collected from 274 credit-granting stores in the Fifth
Federal Reserve District. The survey covered nine lines
of trade which constitute the bulk of credit transac­
tions— automobile dealers, automobile tire and acces­
sory, department, furniture, hardware, household ap­
pliance, jewelry, men’s clothing, and women’s apparel
stores. Coverage in none of the nine lines of retail trade
surveyed is extensive enough to be entirely representa­
tive, and data for hardware and jewelry are particularly




inadequate. With cognizance that the reporting samples
are small and that wide distribution throughout the Dis­
trict has not been achieved, trends exhibited in the shifts
from cash to credit by respondent firms in the lines cov­
ered in the Fifth District are probably representative.
Furthermore, the changes in sales from 1946 to 1947 in
each line of trade are not greatly at variance with na­
tional trends shown by the Department of Commerce.
Sales Move Upward in 1947
Sales moved higher in 1947 compared with 1946 for
six of the nine lines of retail trade reporting in the Fifth
Federal Reserve District Credit Survey. Automobile
dealers and household appliance stores, with sales up 72
per cent and 57 per cent respectively, showed the great­
est gains and reflected the increasing availability of auto­
mobiles and household appliances. The removal of cer­
tain hardware items from the scarcity list contributed
to a 19 per cent increase in hardware sales during the
year. Reflection of price increases were shown in gains
of 14 per cent, 7 per cent, and 4 per cent in furniture,
men’s clothing and department store sales respectively.
Automobile tire and accessory dealers were generally
able to meet the backlog of demands during 1946 and this
fact contributed to an 11 per cent decline in sales in
1947. Despite the appearance of new styles in women’s
clothes, women’s apparel shops recorded a drop of 3 per
cent in sales. The smallest fluctuation in the nine lines
surveyed was shown in jewelry which was down 2 per
cent in sales from 1946.
Cash Sales
With the exception of automobiles, household appli­
ances, and hardware, cash sales in 1947 declined in all
lines from those of 1946. While automobile dealers
showed a 75 per cent increase in cash sales, in many in­
stances “ cash” represented a loan obtained from some
other source through which the consumer preferred to
finance his purchase rather than through the dealer. Cash
sales of automobile dealers accounted for 75 per cent
of total sales in 1947 compared with 74 per cent in 1946.
This was the only one of the nine groups in which cash
sales did not show a markedly lower percentage of total
sales in 1947 than in 1946. Increased supplies of house­
hold appliances and the availability of well-known brands
helped to push cash sales of these items 44 per cent above
1946. Automobile tire and accessory stores showed a de­
cline of 34 per cent in cash sales while losses in cash sales
in other lines were not quite so marked as women’s ap­
parel declined 15 per cent, jewelry dropped 13 per cent,
and furniture fell 12 per cent.
Increase in Credit Sales
The sharp increase in credit sales in 1947 was a re­
flection of several factors. During the year, goods with
a high unit value which consumers ordinarily purchase
on credit became increasingly available; dealers en­

r3 1

FEDERAL RESERVE BANK OF RICHMOND

couraged customers to purchase on credit; and towards
the latter part of the year credit control restrictions were
removed. As wartime savings dwindled, as musteringout payments to veterans were fewer, and as the cost-ofliving continued to increase in 1947, consumers were less
able to make cash payments in business transactions in
1947 than in 1946.
Credit sales increased in each line of trade covered in
the survey and a marked shift to instalment buying was
noted. Instalment components constituted a larger per­
centage of credit sales in 1947 than in 1946 in all lines
except men’s clothing and women's apparel which re­
mained unchanged. Customarily instalment sales of
men’s clothing and women’s apparel stores represent a
very small percentage of total sales in these two lines.
While charge account sales of automobile dealers in­
creased 45 per cent from 1946 to 1947, instalment sales
jumped 119 per cent, and as charge account sales de­
clined from 20 per cent to 17 per cent of total sales, in­
stalment sales rose from 6 per cent of total sales in 1946
to 8 per cent of total sales in 1947. In the household ap­
pliance group, charge account sales increased 51 per
cent; instalment sales gained 72 per cent. In the same
group charge account sales comprised 51 per cent of
total sales in 1946 and 49 per cent in 1947, while instal­

ment sales constituted 33 per cent in 1946 and 37 per cent
in 1947.
Gains of 11 per cent in charge account sales and 25
per cent in instalment sales were recorded by furniture
stores in 1947 over 1946. Charge account sales were
equal to 10 per cent of total furniture sales in both 1946
and 1947, but instalment sales rose from 63 per cent of
total sales in 1946 to 69 per cent in 1947. The increasing
use of credit by department store customers was ap­
parent in 1947 as charge account sales were up 11 per
cent and instalment sales climbed 31 per cent from 1946.
Charge account sales comprised 47 per cent and instal­
ment sales 7 per cent of total sales of department stores
in 1947 as compared to 43 per cent and 6 per cent re­
spectively in 1946.
Although charge account sales declined 14 per cent in
automobile tire and accessory stores in 1947 compared
with 1946, instalment sales spiraled upwards for a gain
of 81 per cent. In 1947 charge account sales accounted
for 48 per cent and instalment sales for 24 per cent of
total sales of automobile tire and accessory dealers as
compared to 50 per cent and 12 per cent respectively in
the previous year. Further trends in credit sales are
shown in Table I.

TABLE I
RETAIL SALES BY TYPE OF STORE, FIFTH FEDERAL RESERVE DISTRICT, 1946 & 1947
Percentage Change
Percent of Total Sales
1946 to 1947
Charge
Number
Instal­
Account
Instalment
Type of
of Total Cash Account ment
credit-granting
Cash Sales
Sales
Sales
Stores Sales Sales Sales
Sales
1946
1947
1946
1947
1946
1947
store
-f-72
+45
+119
+75
15
74
75
20
17
6
8
Automobile ................
+57
+44
+ 72
Household Appliance 68
16
14
51
49
33
37
+51
7
+36
52
44
48
1
55
0
+19
Hardware ..................
+ 59
+ 2
+ 14
—12
+ 25
27
21
68
10
10
63
69
Furniture ....................
+11
—6
51
46
29
6
43
47
+ 31
7
Department ................
+ 4
+11
—7
56
49
51
+26
0
44
0
0
Men’s Clothing ......... 15
+ 7
—2
—13
+23
60
21
6
53
17
23
26
Jewelry........................
+ 9
49
43
—3
—15
50
56
1
1
15
Women’s Apparel .....
+ 2
+ 8
Automobile Tire &
—11
—34
—14
38
28
50
48
12
24
51
+ 81
Accessory................
Source: Compiled by Federal Reserve Bank of Richmond from reports of stores cooperating in the Retail Credit Survey.
Trends in Receivables
As a result of the increase in credit sales in 1947, ac­
counts receivable carried by dealers showed gains in each
of the nine lines of trade under review. Increases ranged
from 19 per cent in women’s apparel to 112 per cent in
household appliances. With the exception of automo­
biles, total accounts receivable increased at a faster pace
than credit sales; for example, while total credit sales of
automobile tire and accessory retailers increased 4 per




cent during 1947, accounts receivable carried by these
dealers were 62 per cent greater at the end of 1947 than
at the end of the previous year. As total credit sales of
furniture dealers rose 23 per cent in 1947, end-of-year
receivables were 52 per cent higher than in 1946.
Ratios of receivables to sales increased in most lines
for both instalment and charge account sales. This trend
was indicative of less prompt payment of accounts by
customers and the extension of more liberal credit terms
by retailers. Details are shown in Table II.

MONTHLY REVIEW

JUNE 1948

TABLE II
ACCOUNTS RECEIVABLE BY TYPE OF RETAIL STORE
FIFTH FEDERAL RESERVE DISTRICT, 1946 AND 1947
(Accounts receivable figures are based on end-of-year
data; sales, on annual totals)
Accounts receivable
Charge Account
Instalment re­
percentage change
receivables as
ceivables as
1946 to 1947
% of charge
%of instal------ men^sales------Type of CreditCharge
Instalsales-granting stores*
Total
Account
ment
1946
1947
1946
1947
Automobile.....................
+ 27
+ 3
+ 87
14
10
23
19
+112
+ 53
+173
7
8
24
27
Household appliance.......
Hardware......................
+ 48
+ 47
+ 52
11
13
99
94
Furniture ......................
+ 52
+ 39
+ 53
27
32
37
44
Department ....................
+ 27
+ 23
+ 46
23
26
37
41
Men’s Clothing ............
+ 39+ 39
.....................
22
24
Jewelry ..........................
+ 30
+ 10
+ 45
39
35
37
49
Women’s Apparel .........
+ 19
+ 20
+ 1
23
26
70
70
Automobile Tire &
Accessory ...................
+ 62
+ 7
+200
11
14
19
31
*Type of store arranged in order of percentage change in total sales by type of transaction, 1946 to 1947, as reported in Table I.
Although retailers sold more instalment paper to banks inventories by retailers as scarce goods became available,
and finance companies in 1947 than in 1946, the larger Increased inventories in many cases represented an ex­
sales of instalment paper did not keep pace with instal- pansion of stocks to a more normal ratio to sales. Inment sales. The small amount of instalment paper sold ventories of all lines showed increases except women’s
indicated most retailers were in a good financial condi- apparel and department stores where declines of 7 per
tion and were in a position to bolster sales by promoting cent and 1 per cent respectively were registered. While
credit transactions without sacrificing a portion of their automobile tire and accessory sales dropped 11 per cent,
profits by selling instalment paper. Automobile dealers inventories rose 44 per cent indicating that the pent-up
who sold instalment paper sold it in an amount equal to demands for such items as automobile tires were satisfied
79 per cent of instalment sales in 1947 and equal to 71 in a relatively short time after the end of the war. An inper cent of instalment sales in 1946. The sale of instal- crease of 31 per cent in inventories of men’s clothing inment paper was of importance in only one other line, dicated that veterans had replenished their wardrobes
household appliances. Among dealers in this group who and were buying at a slower pace and that stores were
sold instalment paper, the percentage of instalment paper able to acquire a larger selection of goods. Other lines
sold to instalment sales remained unchanged from 1946 which reflected increased inventories were hardware,
to 1947, the figure being 87 per cent for both years.
household appliances, and automobiles with rises of 41
Consistent with the tightening of consumer finances
Per cent’ ^ Per cent an<^ ^2 Per cent respectively.
was the increase in bad debt losses noted in all lines exInventor Turnover
cept women’s apparel and jewelry where respective de^
dines of 34 per cent and 20 per cent were registered. Of
Basing inventory turnover on the ratio of total anthe seven lines that showed larger bad debt losses in 1947 nual sales to the end-of-year inventories at retail, the
than in 1946, the range was from 16 per cent in auto- inventory turnover ratio in 1947 was greater in five of
mobiles to 118 per cent in automobile tires and acces- the nine lines surveyed than in 1946 and this was an imsories. However, in two of these lines, automobiles and p^ ant consideration in store’s ability to take a smaller
household appliances, bad debt losses did not increase at mark in thdr merchandise. Hardware, men’s clotha rate as great as the rate of interest in credit sales. In a
. . ,
< ,
,
comparison of bad debt losses to total credit sales it was
Y an aU omo 1€ .^e an acc^ssory s ores r^“
J
found that bad debt losses amounted to slightly more Ported that stociks
wlth less raPldlt^ than m the
than one per cent of total credit sales of jewelry stores, Preylous year, but this was mainly due to the greater
approached one per cent of total credit sales of furniture availability of these goods. The general average of stock
stores, and were less than ,one-half of one per cent of turnover ratio ranged from three to six times per year,
total credit sales of other types of retail stores.
However, extremes were present with automobiles on
one end of the scale showing a turnover of over twelve
Expansion of Inventories
times a year and jewelry on the other end of the scale
Stocks of merchandise at the end of 1947 showed gains showing a turnover of 2.3 times a year. Other inventory
over the previous year and reflected the expansion of
turnover ratios are shown in Table III.




r5 1

FEDERAL RESERVE BANK OF RICHMOND

T A B L E III
S A LE S ANiD IN V E N T O R IE S B Y T Y P E OF R E T A IL STORE
F IFTH F E D E R A L R E S E R V E D ISTRIC T, 1946 A N D 1947
Num ber
of
Stores

Type o f Credit
Granting Store

Percentage Change
1946 to 1947
Total E nd-of-year
Sales
Inventories

Inventory
Turnover R atio
1946

1947

..................

19

+ 65

+ 22

9.1

12.2

Appliance..

10

+ 41

+ 23

4.7

5.3

H ardw are ......................

12

+ 18

+ 41

3.0

2.5

Furniture

......................

77

+ 10

+

2

3.2

3.4

Departm ent ..................

32

+

4

— 1

4.8

5.0

Autom obile
Household

M en’3 Clothing ............

17

+

8

+ 31

6.1

5.0

Jew elry ..........................

7

—

1

+ 11

2.6

2.3

W om en’s A pparel .....

17

— 3

— 7

6.2

6.4

A utom obile Tire &
A ccessory ..................

51

— 11

+ 44

5.0

3.1

Data on Individual Cities
Paucity of data for various cities in the Fifth District
precludes a discussion of trends in retail credit in the
cities except in general terms. For the most part the
cities displayed the same tendencies that prevailed in the
District as a whole— declines in cash sales; increases in
credit sales, both charge account and instalment; and
increases in accounts receivable, both charge account and
instalment.
Automobile sales in Baltimore in 1947 increased 117
per cent over 1946 with a 25 per cent increase in charge
account sales and a 204 per cent increase in instalment
sales. These increases were somewhat larger than the
increase in the District as a whole and were probably
caused in part by better deliveries by manufacturers to
Baltimore dealers than to dealers in other cities in the
District. Contrary to the pattern of the District as a
whole, accounts receivable of Baltimore automobile deal­
ers declined 18 per cent from 1946 to 1947. It appears
that Baltimore automobile retailers sold a greater per­
centage of instalment paper acquired than did retailers
in other cities in the District.
Furniture sales in the cities of the District followed
the same general pattern as the District as a whole. Cash
sales reversed their upward trend of the past several
years and accounted for a smaller proportion of sales
volume. Total sales ranged from an increase of 10 per

cent in Charleston, South Carolina, to an increase of 23
per cent in Charleston, West Virginia. Charge account
furniture sales ranged from an increase of 13 per cent
in Richmond to an increase of 32 per cent in Charlotte,
while instalment sales in the same line ranged from an
increase of 13 per cent in Charleston, South Carolina to
an increase of 35 per cent in Charlotte.
Trends in department store sales in 1947 for the three
cities covered— Washington, Baltimore, and Richmond—
are very similar. Total sales increased 4 per cent in
Washington, 3 per cent in Baltimore, and 6 per cent in
Richmond. The movement away from cash toward cred­
it sales was evidenced in all three cities. Sharp rises in
instalment sales of department stores are recorded as
this kind of credit rose 34 per cent in Washington, 22
per cent in Baltimore, and 55 per cent in Richmond. By
the end of the year, accounts receivable were increasing
at a greater rate than sales as evidenced by increases in
accounts receivable of 28 per cent in Washington, 16
per cent in Baltimore, and 48 per cent in Richmond.
Data on retail sales and accounts receivable for vari­
ous cities in the Fifth Federal Reserve District are
shown in Table IV.
T A B L E IV
P E RC E N T AG E CH AN GE, 1946 TO 1947, IN S A LE S A N D A CC O U N TS
R E C E IV A B L E B Y T Y P E OF R E T A IL STORE IN SELECTED
C ITIES— F IFTH F E D E R A L R E S E R V E D ISTRIC T
(Sales o f Credit-G ranting Stores are Based on A nnual T otals;
A ccoun ts Receivable, on end-of-year Data)
Type o f Store
and L ocality
Autom obile (D ist.)
Baltim ore

Total

Sales
Charge Instal­
Cash
ment
A c c ’t

A ccounts Receivable
Chg. InstalTotal A cc’ t ment

+ 72
+ 117

+ 75
+ 133

+
+

45
25

+ 119
+ 204

+ 27
— 18

+ 3
— 18

+ 87
— 14

—
—

+
+
+
+

11
15
13
32

+ 39
+ 34

+ 53
+ 152
+ 82

18

25
30
32
35
17
13

+ 52
+ 152
+ 64

+

+
+
+
+
+
+

+
+
+
+

11
11
11
15

+
+
+
+

36
34
22
55

+
+
+
+

27
28
16
48

+
+
+
+

+
+
+
+

+
+

26
23

0

+
+

39
39

+ 39
+ 39

81
59

+
+

62
63

+ 10
+ 14

Furniture (D istrict)
Baltimore
Richm ond, Va.
Charlotte, N. C.
Charleston, W . Va.
Charleston, S. C.

+
+
+
+
+
+

14
16
20
21
23
10

Departm ent (D ist.)
W ashington, D. C.
Baltimore, Md.
Riel mond, Va.

+
+
+
+

4
4
3
6

12
9
0
— 19
— 42
— 12
—
6
—
6
—
8
3
—

Men’s Clothing
(D istrict)
Richm ond, Va.

+
+

7
9

—
—

Autom obile Tire &
Accessory (D ist.)
Richm ond, Va.

—

— 11
7

7
6

— 34
— 28

— 14
— 11

+
+

23
20
14
47

46
52
30
69

+ 45
+ 151

Business Conditions
Continued from page 2

tions, for working time has been reduced in some plants;
manufacturing, sales yarn, work clothing, furniture,
and hosiery. Furthermore the situation confronting these
same industries would point to lower production or an
accumulation of inventories at the producer level.
ECA funds have improved the foreign demand for
cotton and tobacco, somewhat, but few other reflections
of this money can as yet be found in this District. Con­
struction is in large volume and will fully occupy avail­
able workers through the summer. New contract awards
appear to be leveling off, but this will have no retarding
effect on the volume of construction expenditures over




the next several months. Car shortages are showing up
in the coal fields, and the moving of another large wheat
crop will make fewer cars available for hauling lumber.
In contrast to the generally easier tendency in produc­
tion and trade indicators of the District are continued
rises in the trends of bank debits and electric power pro­
duction. The debits series are no doubt influenced con­
siderably by the activity of the real estate market. In
the latter series the effects of full employment may be
reflecting a relative gain in consumption by domestic
users.

MONTHLY REVIEW

JUNE 1948

The Continued Expansion of Bank Loans
3. That banks should give priority to loans to those
borrowers who can turn out the supplies and serv­
ices needed at home and abroad now, in order that
the machinery for the production of essential goods
may be kept functioning at maximum levels.

The past few months have seen four main develop­
ments which have been designed to influence banks to
decrease their expansion of loans or have had that ef­
fect incidental to other objectives. It is of interest to
re-examine these developments and to examine the sub­
sequent course of bank loans both as to the changes in
total loans and as to the types of loans in which the
changes have occurred.
Statement o f the bank supervisory authorities. On
November 24, 1947, the Board of Governors of the
Federal Reserve System, the Comptroller of the Cur­
rency, the Federal Deposit Insurance Corporation, and
the Executive Committee of the National Association
of Supervisors of State Banks issued a joint statement
discussing the current boom conditions and the contribu­
tion that a further growth of bank credit would make to
the already excessive demand, resulting in still higher
prices. Banks were warned to exercise extreme caution
in their lending policies, in particular to “ curtail all
loans either to individuals or businesses for speculation
in real estate, commodities, or securities,” to “ guard
against the over-extension of consumer credit,” and not
to relax the terms of instalment financing. “ As far as
possible,” the statement said, “ extension of bank credit
under existing conditions should be confined to financing
that will help production rather than merely increase
consumer demand.”
Lowering o f support levels for United States Govern­
ment obligations. Action by the Federal Open Market
Committee on December 24, 1947, in lowering the prices
at which obligations of the United States Government
would be supported served in some measure as a deter­
rent to the liquidation of holdings of long-term Gov­
ernments by banks in order to make loans. Banks hold­
ing long-term securities were faced with the necessity
of recognizing declines in market values in the event of
sale; since securities might be carried at values above the
market level— with provision for amortization— some
holdings were in effect frozen by this action. In these
particular cases, definite limits were thus placed upon
the volume of loans that might be held.
The American Bankers Association program o f selfrestraint. In the early months of 1948 the message of
this program was carried to virtually every banker of
the country. The main points of the program as stated
by A B A President Joseph Dodge, were as follows:
“ 1. That in the months immediately ahead, com­
modity and inventory loans which are designed to
withhold essential goods from the normal market
channels in anticipation of price rises should not be
made.
2. That mortgage loans for non-essential building
or for construction which can be postponed until
building supplies and labor are in greater abundance
should be discouraged at the present time.




4. That there should be a greatly intensified drive to
sell Treasury Savings Bonds to the public and to
promote other forms of savings, such as savings ac­
counts in banks, as a means of absorbing some of
the surplus money in the spending stream which
would otherwise continue to compete for the goods
and services in short supply.”
Treasury cash surplus. During the first quarter of
1948 (and the week ended April 7, 1948) the United
States Treasury realized a cash surplus of $6.7 billion
from current fiscal and nonmarketable security opera­
tions ; this sum was available for the retirement of mar­
ketable debt and $4.9 billion was so used. O f this $3.9
billion was used to retire obligations held by the Federal
Reserve banks, while another $300 million was used to
increase Treasury deposits with the Reserve banks, the
equivalent of the retirement of System-held debt inso­
far as the banking system was concerned. This drain of
reserves, although offset in part by a return flow of cur­
rency from circulation, an increase in the gold stock, and
a decline in reserve requirements, placed banks under
pressure for reserves throughout the three-month peri­
od. Under such conditions it was to be expected that
there would be some reluctance to expand loans since
to do so would place additional strains upon reserves
and, generally speaking, require the liquidation of other
assets.
Increase in Loans, United States
The estimated total loans of all banks increased from
$43.0 to $43.9 billion from December 31, 1947, to April
28, 1948, a gain of 2.0 per cent. This compares with an
increase of 7.6 per cent during the first six months of
1947, when total loans rose from $35.6 billion to $38.4
billion. Making allowance for the difference in the two
time periods (four months as compared with six), it is
still evident that the rate of increase thus far in 1948
has not been so great as that of 1947.
TABLE I
BAN K LOANS
(A m ounts in m illions o f dollars)

Class o f Bank
A ll banks
Com m ercial banks
Member banks
W eekly reporting
m em ber banks
N on-w eekly reporting
m em ber banks

A pril 28,
1948

Per cent chg.
Chg. from Dec. 31, ’ 47 Dec. 31, ’ 46 to
A m ount
Per cent
A pr. 30, '47

43,860e
38,760e
33,018

+ 861
+ 705
+ 390

+ 2.0
+ 1.9
+ 1.2

23,160

— 169

— 0.7

+

9,858

+ 559

+ 6.0

+ 10.2

n.a.
n.a.
+ 4.5
2.3

e Partly estimated
n.a. N ot available

The expansion of the loans of commercial banks dur­
ing the four-month period was estimated to be at a
r7 1

FEDERAL RESERVE BANK OF RICHMOND

somewhat lower rate than that for all banks, indicating
a higher rate for mutual savings banks. Similarly, since
the loans of member banks did not increase by as large
a percentage as did those of all commercial banks (1.2
as compared with 1.9), it appears that the loans of non­
member commercial banks increased by relatively great­
er amounts than did the loans of members.
The rate of increase of the member banks was con­
siderably below that of last year, 1.2 per cent as com­
pared with 4.5 per cent for the corresponding period of
1947. The weekly reporting member banks— consisting
principally of the larger member banks and holding 70
per cent of total member bank loans on April 28— showed
an actual decline in total loans from the year end to
April 28, 1948, as compared with an increase of 2.3 per
cent during the comparable period of last year. The re­
maining member banks showed a substantial increase—
6 per cent— which, however, was still less than last
year’s increase of 10.2 per cent.
Figures by classification of loans are available only
for the weekly reporting member banks, all other mem­
bers reporting only the aggregate amount of loans out­
standing. Table II below shows the changes that oc­
curred in the principal loan categories of the reporting
banks, together with the percentage change for the cor­
responding period of 1947.
TABLE II
L O A N S OF W E E K L Y R E PO R TIN G M E M B E R B A N K S
U N ITE D S TATE S

Class o f Loan

(A m ounts in m illions o f dollars)
Change from
Per cent change
Dec. 31, '46 to
A p ril 28,
Dec. 31, 1947:
A pr. 30, ’ 47
A m ount
Per cent
1948
I,

and agricultural
F or purchasing and
carrying securities
R eal estate
Other
Total

14,159

— 499

— 3.4

+

6.1

1,658
3,669
3,774
23,160

—
+
+
—

—
+
+
—

—
+
+
+

30.9
13.7
8.8
2.3

16
209
237
169

1.0
6.0
6.7
0.7

It may be noted that the relatively small increase of
the total loans of weekly reporting member banks in the
first four months of 1947 was the result of the offsetting
of a large decrease in loans for purchasing and carrying
securities against substantial increases in the other three
categories of loans. The changes of this year were small­
er and assume greater significance when viewed against
the comparable changes of last year.
The decline in commercial, industrial, and agricultural
loans represented a direct reversal of the performance
of 1947. The decline in loans for purchasing and carry­
ing securities was of far smaller magnitude both rela­
tively and in dollars than it was in the earlier period.
Real estate loans and “ other loans” — the latter including
consumer credit loans— increased by substantial per­
centages, although in neither case so rapidly as in the
four-month period o f 1947.
As has been seen, the weekly reporting member banks
are not representative of all banks; yet some general
conclusions may be drawn from their figures. In par­
ticular, it appears that further expansion of real estate
loans has contributed heavily to the increase of total
loans that has occurred this year. The lower rate of in­
crease as compared with last year has come in the face
of an increased dollar value of private construction—




$3.7 billion in January-April, 1948, as compared with
$2.6 billion for the same period of 1947— and reflects
three factors in the mortgage situation for banks: small­
er loans relative to appraised property values, a de­
creased turnover of old properties, and an increasing re­
luctance by banks to make real estate loans due to the
disappearance of the secondary markets for guaranteed
mortgages.
Other series than the weekly reports of member banks
confirm the importance of consumer credit in contribut­
ing to the expansion of bank loans. Commercial bank
outstandings of consumer instalment paper are esti­
mated to have increased by 13.6 per cent between De­
cember and the end of April. Availability of durable
consumer goods— at advanced prices— and the deter­
mination on the part of banks to establish and maintain
their position in this field have both contributed to the
increase.
The position of business and agricultural loans in the
picture is not as clear as that of the two types of loans
mentioned above. Agricultural loans occupy a minor
place in the aggregate of commercial, industrial, and
agricultural loans of the weekly reporting banks; among
the non-reporting banks, however, they are of greater
importance. Banks of this District report that the de­
mand for agricultural advances this year exceeds that
of previous years, due in most cases to increased costs
of production. It is likely that the increased volume of
loans to farmers contributed more than seasonally to
the increase in outstandings of the non-reporting banks,
and was probably a slight sustaining factor in the total
of commercial, industrial, and agricultural loans of the
reporting banks.
The decline of business and agricultural loans in the
reporting banks was widespread through the country,
the banks of only three Federal Reserve districts— Rich­
mond, Minneapolis, and San Francisco— showing an
increase. It is believel that some part of the decline re­
flected the use of alternative methods of financing by
corporate borrowers, viz., security issues and loans from
insurance companies. To the extent that this supposition
is correct, it is probable that the smaller banks did not
show a corresponding decline but rather increased
further. Smaller businesses do not have access to these
alternative sources of funds, and it is probable that their
demand for funds increased during the period under
consideration. This demand may account for much of
the greater growth record of the non-reporting member
banks and the non-member banks as compared with the
weekly reporting banks.
The following chart gives the changes in the compo­
nents of the loans of weekly reporting United States
member banks for the first half of 1947 and through
June 9, 1948. The grouping in the chart facilitates a com­
parison between the percentage change in each category
of loans for the two years. Since the latter part of April
commercial, industrial, and agricultural loans have re­
mained approximately the same, while during the same
weeks of the previous year they declined slightly. “ Other
loans,” which include loans to banks and personal loans,
continued their upward trend during May. The erratic

JUNE 1948

MONTHLY REVIEW
T A B L E IV

CHART I

L O A N S OF W E E K L Y

R EP OR T I NG M E M B E R BANKS

U NI TE D STATES

I B IL L IO N S
20

L O A N S OF W E E K L Y R E P O R TIN G M EM BER B A N K S
F ifth D istrict
(m illions o f dollars)

KB
ILLIO S
N
20

CO M M E R C IA L, IN D U S T R IA L , AND A G R IC U LT U R A L LO AN S

I

-}

— t—

I

May 26
1948

Class o f Loan

r

Com m ercial, industrial,
and agricultural
F or purchasing and
carrying securities
Real estate
Other
T otal

------- 1947
------- 1948

Chg. from Dec. 31, *47
A m ount
P er Cent

P er cent chg.
Dec. 31, ’ 46 to'
M ay 28, *47

387

— 1

— 0.3

+

3.1

53
188
193
821

—
+
+
+

—
+
+
+

—
+
+
+

18.7
14.8
6.7
3.4

6
17
8
18

10.2
9.9
4.3
2.2

O TH ER L O A N S

A study of the breakdown of the loans of the Fifth
District weekly reporting member banks indicated that
loans for purchasing and carrying of securities were the
only category of loans which registered a decided de­
cline during the five-month period ended May 26, 1948.
This was also the case in the previous year, when the
decline was 7 percentage points greater. Commercial, in­
dustrial and agricultural loans dropped slightly below
the December 31,1947 amount. Real estate loans showed
a percentage increase of 10 per cent, which was less than
during the corresponding period in 1947.

.OANS FOR PURCHASING OR CA R R Y IN G S E C U R m E S

I _____1_
_

i-r

JANUARY

R E A L E S T A T E LOANS
FEBRUARY

MARCH

jump during the third week in April was caused by the
doubling of loans to banks for the one week. Loans for
the purpose of purchasing and carrying securities evi­
denced an upward turn in May which carried them above
the December 31, 1947 amount. The same movement
was experienced by this group of loans during May,
1947. Real estate loans continued in the upward trend
which began in January of 1946. At the end of April,
1948, total loans showed a less than one per cent de­
cline during the four-month period, but by the beginning
of June the percentage change from the December 31,
1947 figure had become a positive amount.

CHART 2

L OANS OF W E E K L Y

iillions

R E P OR T I N G M E M B E R BANKS

F I F T H DI S T R I CT

600

60 0

500

C O M M E R C IA L, IN D U ST R IA L , AND A G RIC U LTU RA L LOANS

----I f ----- ------------------- 1---

400
300

500
400
300

-O T H E R L O A N S -

Tit
• 1947

1948

I

I

I

I

I

"L O A N S FOR PURCHASING OR CA R R Y IN G S E C U R IT IE S -

Loans of Fifth District Member Banks

60

Loans of Fifth District member banks showed an in­
crease during the first four months of 1948 that was
more than three times the rate of increase for members
of the country as a whole, 4.0 per cent as compared with
1.2 per cent. As in the national figures, the rate of ex­
pansion was greater among the generally smaller non­
weekly reporting banks; contrary to the national trend,
however, the loans o f the weekly reporting banks showed
an appreciable increase, 2.2 per cent as compared with
the 0.7 per cent decline for the country.
T A B L E III
B A N K LO A N S, FIFTH D ISTRIC T M EM BER B A N K S
(A m ount in m illions o f dollars)

Class o f bank
Member banks
W eekly reporting
member banks
N on-w eekly reporting
member banks

May 26
1948
1,491

Per cent chg.
Dec. 31, '46
Chg. from Dec. 31, *47
A m ount
Per cent
to M ay 28, '47
+ 69

+ 4.9

+

7.3
3.4

821

+ 18

+ 2.2

+

670

+ 51

+ 8.3

+ 12.5

As compared with the increases for the first five
months of 1947, the gains of the Fifth District banks
were smaller. The increase of the loans of the nonweekly reporting banks bore about the same relation to
last year’s increase as was indicated in the national
figures. The gain for the weekly reporting banks, how­
ever, approached that of last year.




50
40
30

200
i

i------------ 1
1
U --------------1
1
REAL ESTATE LO ANS
i
!----1
«
1
- JANUARY

FEBRUARY

1

.

1
1

1
*

M ARCH

It is interesting to note that during this period total
loans reached their peak during the third week in M arch;
since then they have been declining, the latest data be­
ing for June 9. This was influenced by the fact that
commercial, industrial and agricultural loans followed
the same pattern and they comprise 50 per cent of total
loans. Real estate and “ other loans’’ showed a steady
advance during the whole of the five months’ period.
There are 51 weekly reporting member banks in the
Fifth District, which, although they amount to only 11
per cent of all the member banks, represent the largest
banks in the District. On May 26, 1948 these weekly re­
porting banks had 55 per cent of the total loans of Dis­
trict member banks.
Loan Increases by States and by Size of Bank
The member banks of West Virginia registered a
larger percentage increase in their total loans for the
five-month period ended May 26, 1948 than did the

FEDERAL RESERVE BANK OF RICHMOND

member banks of any other state in the Fifth District.
This was an increase of 9.6 per cent which was followed
by the District of Columbia with an increase of 8.7 per
cent. The remaining states were below the District
average of 4.9 per cent, the lowest being South Carolina
with an increase of only 1.9 per cent.
TABLE VI
L O A N S OF M EM BER B A N K S OF TH E FIFTH D ISTRIC T
(thousands o f dollars)
May 26, 1948
Chg. since Dec. 31, 1947
A m ount
M aryland
D istrict o f Columbia
V irginia
W est V irgin ia
N orth Carolina
South Carolina
F ifth D istrict

249,734
241,249
482,242
140,652
278,958
98,634
1,491,469

+
+
+
+
+
+
+

Per cent

10,656
19,251
17,473
12,350
7,802
1,836
69,368

+
+
+
+
+
+
+

4.5
8.7
3.8
9.6
2.9
1.9
4.9

In a further investigation as to what group of banks
evidenced the largest increase in their total loans, a
breakdown was made as to size groups among the mem­
ber banks of the Fifth District. It was found that during
the four-month period ended April 28, 1948, the smaller
banks, i.e., those with deposits under $10 million dol­
lars, registered the greater percentage increase in loans
made. O f the 335 in the smaller category 90, or 27 per
cent, registered percentage gains of 16 per cent or over.
It is the group of larger banks which have tended to
reduce their loans in response to the previously cited
restrictive factors. Member banks in the Fifth District
which have deposits of $100 million or more, account
for 4.8 per cent of the number of member banks and
hold 30 per cent of total loans outstanding; these banks
accounted for 7 per cent of the net increase in loans
during this period.
The following tables give a detailed analysis of the
increases and decreases of total loans by member banks
divided into size groups.
T A B L E V II
N U M B ER OF M EM BER B A N K S SH O W IN G IN D IC ATE D
PE R C E N T A G E IN CR E ASE S IN T O T A L LO A N S, D ECEM BER 31,
1947 TO A P R IL 28, 1948
T otal No. o f
Size o f bank (total banks having
deposits, $m illion) increases
U nder 2
2- 5
5 - 10
1 0 -2 5
25 - 50
50 - 100
Over 100
Total

0-4
22
25
12
14
6
1

115
149
71
46
14
7
4
406

80

Percentage increase
4-8
8-12 12-16
23
34
20
13
3
2
3
98

25
28
10
11
2
3
1
80

12
26
8
1
2

49

T A B L E V III
N U M B E R OF M EM BER B A N K S SH O W IN G IN D IC ATE D
P E R C E N T A G E DE C RE A SE S IN T O T A L LO A N S, DECEM BER 31,
1947 TO A P R IL 28, 1948
Total N o. o f
Size o f bank (total banks having
deposits, $m illion) decreases

0-4

U nder 2
2- 5
5 - 10
1 0 -2 5
25 - 50
50 - 100
Over 100
Total

6
14
2
10
3
4
3
42




8
20
7
17
4
7
6
69

Percentage decrease
4-8
8-12 12-16
2
4
3
1
1
3
2
16

"2
1
4

"l
1

7

*1
3

Conclusion
At the end of the first five months of 1948, total loans
in the member banks of the United States and of the
Fifth District increased, but by a smaller percentage
than they did during the corresponding period of the
previous year. In the Fifth District real estate loans
showed a greater percentage increase than any other
type of loan, but in the United States “ other loans” ex­
ceeded real estate loans by .7 of a percentage point. A l­
though commercial, industrial and agricultural loans de­
creased slightly in the past month they are still asso­
ciated with an increasing upward trend in both the
United States and the Fifth District. In both classifica­
tions the smaller, non-reporting member banks, regis­
tered the greater increases in loans during this period,
while non-member banks exceeded member banks. In
the states of the Fifth District, West Virginia and the
District of Columbia had loan increases above the aver­
age.

AVERAGE DAILY TOTAL DEPOSITS* OF
MEMBER BANKS
Last half of Apr.
Last half of May
% of
%of
$ thousands U.S. $ thousands U.S.
Maryland
.93
987,463
.93
989,275
Reserve city banks
628,437
.59
627,227
.59
Country banks
360,838
.34
.34
360236
897,779
.84
District of Columbia
.85
896,966
876,636
.83
875,353
.82
Reserve city banks
Country banks
.02
21,143
21,613
.02
Virginia
1,259,215 1.19
1,270,193 1.20
Reserve city banks
295,379
.28
304,327
.29
Country banks
.91
963,836
.91
965,866
West Virginia
584,559
.55
.55
581,564
North Carolina
824,426
.78
.77
816,310
Reserve city banks
387,843
.37
381,024
.36
Country banks
436,583
.41
435,286
.41
South Carolina
428,600
.40
427,944
.40
Fifth District
4,983,854 4.70
4,980,440 4.69
United States (millions) 105,965 100.0
106,223 100.0
^Excluding interbank demand deposits.

MONTHLY REVIEW

JUNE 1948

ASSETS AND LIABILITIES— MEMBER BANKS, FIFTH FEDERAL RESERVE DISTRICT

(Amounts in thousands of dollars)
1947
1948
1946
Dec. 31
April 12
Dec. 31
ASSETS
Loans and investments...........................................
Loans (including overdrafts).............................
United States Government direct obligations....
Obligations guaranteed by United States Government..
Obligations of States and political subdivisions............
Other bonds, notes and debentures....................................
Corporate stocks (including Federal Reserve Bank stock)..
Reserves, cash, and bank balances..................................................
Reserve with Federal Reserve Bank...........................................
Cash in vault..
Demand balances with banks in United States (except private banks and
American branches of foreign banks).................................................................
Other balances with banks in United States.......................................................
Balances with banks in foreign countries..............................................................
Cash items in process of collection..........................................................................
Bank premises owned and furniture and fixtures....
Other real estate owned...........................................
Investments and other assets indirectly representing bank premises or other
real estate .................................................................................................. •..............
Customers’ liability on acceptances............................................................................
Other assets ................................-...................................................................................

5,867,226

4,349,321
1,436,336
2,662,920
512
108,865
131,247
9,441
1,623,323
789,370
127,010
406,469
2,689
72
297,713
46,274
870
2,637
722
15,350
6,038,497

4,352,613
1,149,106
2,972,371
488
92,452
128,946
9,250
1,493,796
733.924
125,931
368,064
1,762
191
263.924
44,896
760
2,693
986
13,787
5,909,531

4,150,462
3,210,318
112,671
360,907
384,624
4,154
77,788
1,306,455
1,269,272
14960
192
20,362
1,669
5,456,917
12,082
476
25,077

4,342,505
3,383,716
73,133
318,396
480,273
5,175
81,812
1,304,320
1,265,685
12,912
192
20,295
5,236
5,646,825
3,455
722
25,656

4,262,543
3,271,716
125,117
21,972
273,305
469,060
7,353
94.020
1,282,101
1,245,481
13,360
348
17.020
5,892
5,544,644
1,631
986
24,027

5,494,552

5,676,658

5,571,288

CAPITAL ACCOUNTS
Capital ...................................................................................
Surplus ..................................................................................
Undivided profits ...............................................................
Other capital accounts.......................................................
Total capital accounts........................................

117,027
164,223
66,105
25,319
372.674

115,702
162,775
58,619
24,743
361,839

113,476
150,687
51,854
22,226
338,243

Total liabilities and capital accounts.............

5.867,226

6,038,497

5,909,531

477

475

475

Total assets
LIABILITIES
Demand Deposits ................................................................................................................
Individuals, partnerships, and corporations..............................................................
U. S. Government: War Loan and Series E bond accounts.................................
Other ...............................................................................................
States and political subdivisions...................................................................................
Banks in United States..................................................................................................
Banks in foreign countries.............................................................................................
Certified and officers’ checks, cash letters of credit and travelers’ checks, etc..
Time Deposits.......................................................................................................................
Individuals, partnerships, and corporations..............................................................
United States Government.............................................................................................
Postal Savings .......................................................... ......................................................
States and political subdivisions...................................................................................
Banks in the United States...........................................................................................
Total deposits .................................................................................................
Bills payable, rediscounts, and other liabilities for borrowed money..
Acceptances outstanding ..............................................................................
Other liabilities ...............................................................................................
Total liabilities

Number of banks.....................................................




4,323,288
1,492,024
2,574,514
115,033
131,943
9,774
1,475,608
727,050
120,119
358,722
1,266
62
268,389
47,273
1,218
2,619
476
16,744

MONTHLY REVIEW

JUNE 1948
DEBITS TO IN D IV ID U A L A C C O U N TS

F E D E R A L R E S E R V E B A N K OF RICH M O N D
(A ll Figures in Thousands)
June 16
Change in A m t. From
6-18-47
ITEM S
1948
5-12-48
Total Gold Reserves .......................... $1,012,002
15,323
Other Reserves .....................................
1,027,325
Total Reserves ................................
Bills Discounted .....................................
16,300
Industrial Advances .............................
59
Gov. Securities, Total .......................... 1,347,538
Bonds ....................................................
401,145
N otes ......................................................
125,654
285,559
Certificates .........................................
Bills ........................................................
535,180
Total Bills & Securities ...................
1,363,897
U ncollected Items .................................
288,016
Other Assets ...........................................
23,810
Total Assets ....................................... 2,703,048

—
—
—
+
+
+
—
—
+
+
+
+
—
+

52,034
2,837
54,871
3,677
10
26,027
6,783
1,429
15,020
19,219
29,714
50,263
1,260
23,846

4_ 93,850
+
2,667
+ 96,517
+ 7,172
59
+
— 72,801
+ 356,305
—
—
—
+
+
+

90,615
441,379
65,570
12,148
8,079
51,174

Federal Reserve Notes in Cir............. 1,608,413
Deposits, Total .......................................
802,757
M embers’ Reserves ..........................
732,006
U. S. Treas. Gen. A cct .....................
52,357
Foreign .................................................
16,498
Other Deposits ...................................
1,896
252,851
Def. A vailability Items ......................
Other Liabilities ...................................
909
Capital A ccounts ...................................
38,118
Total Liabilities ......................... :...... 2,703,048

—
—
+
—
—
—
+
+
+
+

5,906
21,114
7,981
27,930
392
773
49,543
12
1,311
23,846

—
+
+
+
+
—
+
+
+
+

45,901
73,510
20,047
51,840
1,773
150
20,441
147
2,977
51,174

+102,888

51 R E PO R TIN G M EM BER B A N K S — 5th D ISTRICT
(A ll Figures in Thousands)
C hange in A m t. From
June 16
5-12-48
6-18-47
im

ITEMS

T otal Loans .......................................... $ 818,994
381,412
Bus. & A g r i.....................................
188,971
Real Estate Loans .......................
248,611
A ll Other Loans ..........................
1,734,734
Total Security H oldings ...............
87,828
U. S. Treasury Bills .....................
213,947
U. S. Treasury Certificates ..........
72,242
U. S. Treasury Notes ..................
1,235,300
U. S. Gov. Bonds ........................
125,417
Other Bonds, Stocks & Sec. ...
238,138
Cash Items in Process o f Col.......
163,318
Due from Banks ..............................
63,507
Currency & Coin
...........................
487,442
Reserve with F. R. Bank ..............
55,884
Other Assets .......................................
3,562,017
Total Assets .......................................

—
—
+
—
+
+
+
—
—
+
—
—
—
+
—
+

1,157
7,569
4,482
1,930
22,381
33,435
32,113
3,313
40,795
1,541
1,043
2,136
4,422
7,432
1,570
20,085

+
+
+
+
—
+
—
—
—
+
+
—
+
+
+
+

125,188
52,881
45,006
27,301
96,029
71,184
33,220
8,804
127,764
2,575
48,920
4,839
857
11,896
5,804
91,797

2,723,876
Total Demand Deposits ..................
2,058,716
Deposits o f Individuals ..............
47,935
Deposits o f U. S. Gov.................
.
199,270
Deposits o f State & Local Gov.
373,357
Deposits o f Banks ......................
44,598
Certified Officers’ Checks ............
601,577
T otal Tim e Deposits ........................
584,303
Deposits o f Individuals ..............
17,274
Other Time Deposits ..................
: 700
Liabilities fo r Borrowed Money ..
18,908
A ll Other Liabilities ......................
216,956
3,562,017

+
+
—
—
+
—
—
—
—
—
—
+
+

25,046
61,425
23,912
15,538
7,066
3,995
2,941
2,852
89
1,300
2,850
2,130
20,085

+
+
+
+
+
—
—
—
—
—
+
+
+

96,852
50,237
20,623
12,597
23,316
9,921
14,842
12,289
2,553
4,060
3,251
10,596
91,797

* Net Figures, reciprocal balances being eliminated.

STATES

(000 om itted)

District o f Columbia
W ashington ................
M aryland
B altim ore ..................
Cumberland ................
F rederick ....................
H agerstow n ................
N orth Carolina
Asheville ....................
Charlotte ....................
Durham .......................
Greensboro ................
Kinston ......................
R aleigh ........................
W ilm ington ................
W ilson ........................
W inston-Salem ..........
South Carolina
Charleston ..................
Columbia ....................
Greenville ..................
Spartanburg ...............
V irginia
Charlottesville ..........
Danville ...................... .
L ynchburg ..................
N ew port News ..........
N orfolk .......................
Portsm outh ................
Richm ond .....................
Roanoke ......................
West V irginia
Bluefield ......................
Charleston ..................
Clarksburg ..................
H untington ................
P arkersburg ................
District Totals ...............

Maryland ...................... $35,314,000
3,891,000
Dist. o f Colum bia.......
14,705,000
V irgin ia ........................
W est V irgil-ia ............... .... 13,489,000
18,704,000
N orth Carolina ..........
South Carolina ............ .... 9,143,000
F ifth D istrict .......... $95,246,000
S ource: F. W . Dodge Corporation.

M ONTHS

426
404
378
2,080
1,349

$1,080,000
294,000
291,000
2,192,000
1,897,000

% Change
from
5 Mos. ’ 47

3

$ 3,546,925

+
—
+
+

6
2
10
3

4,732,549
98,893
90,321
129,895

+
—
+
+

54,348
217,520
97,842
70,584
10,627
99,729
34,531
13,565
110,963

+
+
+
+
—
—
—
—
+

28
13
4
8
2
1
9
5
14

242,926
1,123,972
456,127
366,057
56,951
501,230
167,918
67,712
588,019

+
+
+
+
—
+

54,784
89,121
77,771
45,210

+
+
+
+

12
10
19
12

266,859
452,577
391,560
237,169

20,715
23,166
36,340
30,444
184,811
19,296
429,746
84,339

+
+
+
—
+
+
+
+

5
6
11
2
17
7
9
13

106,443
125,715
187,325
153,310
873,784
97,500
2,150,446
411,129

+
—
+
+
+
+
+
+

5
2
13
7
14
8
10
15

37,737
128,848
30,063
53,881
26,608

+ 7
+ 3
+ 10
+ 12
+ 12

197,879
639,645
152,734
277,155
128,379

+
+
+
+
+

19
11
17
18
8

930,290
20,275
18,264
26,193

$3,767,991

+

+

+ 12
9
2
5
7

11
14
1
19
6
4
0
— 5
+ 6
+ 10
+ 10
+17
+ 19

$19,019,104

7

May
1948

M ay
1947

Fifth D istrict States:
401,351
397,272
Cotton consumed ..................
U nited S tates:
Cotton consumed ..................
693,917
707,701
Cotton on hand May 31 in
consum ing establishments.. 1,645,875 1,606,995
storage and compresses .... 2,169,290 1,784,951
Cotton G row ing S tates:
Cotton consumed ..................
785,443
807,135
Cotton on hand May 31 in
consum ing establishments.. 2,006,617 1,926,659
storage and compresses .... 2,232,274 1,842,566
Spindles active, U. S................. 21,723,000 21,631,000
S ource: Departm ent o f Comm erce.

+ 10

A ug. 1 to May 31
1948
1947
4,018,576

4,195,134

6,980,853

7,549,137

7,917,696

8,617,619

COTTON CO N SU M PT IO N — FIF TH D ISTRIC T
M ONTH S

(In Bales)
N. Carolina S. C arolina V irginia

May 1948 .............................. 1
218,882'
A p ril 1948 ...............................
226,307
May 1947 ...................................
206,891
5 Months 1948 ...................... 1,126,310
5 Months 1947 ...................... 1,128,228
S ou rce: Departm ent o f Commerce.

163,542
175,225
171,914
856,133
886,850

District
401,351
420,429
397,272
2,076,607
2,110,972

18,927
18,897
18,467
94,164
95,894

P R ICE S OF U N FIN ISH ED COTTON T E X T IL E S
May
1948
Average, 17 constructions ........................
F rintcloths, average (6) ..........................
Sheetings, average (3) ...............................
Tw ill (1) ........................................................
Drills, average (4) .....................................
Sateen (1) ......................................................
Ducks, average (2) .....................................

A p ril
1948

May
1947

80.54
96.15
69.27
79.86
70.12
97.61
63.27

83.42
102.71
72.08
79.86
70.42
97,61
63.27

83.54
104.71
76.79
79.86
64.76
97,61
62.54

N ote: The above figures are those fo r the approxim ate quantities o f
cloth obtainable from a pound o f cotton with adjustments fo r salable
waste.

C OM M ER C IA L F A IL U R E S
Total Liabilities
N um ber o f Failures
D istrict
U. S.
D istrict
U. S.

16
May 1948 ....... .
...........
17
A p ril 1948
...........
7
May 1947
82
5 Months 1948
35
5 Months 1947 ............
S ou rce: Dun & Bradstreet.




+ 92
— 55
— 37
+ 38
+ 2
+ 35
+ 12

$ 690,280

5 Mos.
1948

COTTON C O N SU M PT IO N A N D ON H A N D — B A L E S

C ON STRU CTIO N CO N TRA C TS A W A R D E D
A pril
% Chg. from
% Chg. from
4 Mos. *47
4 Mos. ’ 48
A p ril 1947
1948
+ 39
$108,195,000
32,249,000
+ 11
60,871,000
— 18
+ 69
42,163,000
49,624,000
— 1
_ 30,246,000___ + 57
_
$322,348,000
+ 18

% Change
from
M ay 1947

May
1948

$13,814,000
15,296,000
17,326,000
85,175,000
76,826,000

D E POSITS IN M U T U A L SAVIN GS BAN KS
8 Baltim ore Banks
May 31, 1948
Total Deposits................$392,812,787

[ii]

A pr. 30, 1948

May 31, 1947

$393,221,652

$385,215,236

FEDERAL RESERVE BANK OF RICHMOND

B U IL D IN G PE R M IT FIG U R E S

W H O L E S A L E T R A D E , 202 FIR M S

Total Valuation
M ay 1948
May 1947
M aryland
B altim ore .............................................................. $4,433,130
Cumberland ..........................................................
124,040
Frederick .......................................................
53,750
H agerstow n ..........................................................
223,035
Salisbury ................................................................
150,492
V irginia
Danville ....................................................... ...........
1,437,354
L ynchburg ............................................................
219,235
N orfolk .......................................................... ........
1,271,640
Petersburg ............................................................
55,000
Portsm outh ..... ...................................... ...............
135,912
Richm ond ..............................................................
834,757
Roanoke ..................................................................
396,016
W est V irginia
Charleston ..............................................................
451,804
321,855
Clarksburg ............................................................
H untington ............................................................
592,244
N orth Carolina
A sheville ................................................................
301,910
Charlotte ................................................................
2,695,013
Durham ..................................................................
429,625
Greensboro ............................................................
1,111,025
H igh P oint ............................................................
344,623
R aleigh .....................................................................
393,545
R ocky M ount ........................................................
252,800
Salisbury ................................................................
111,875
W inston-Salem ......................................... ............
504,759
South Carolina
Charleston ..............................................................
147,272
Columbia ................................................................
389,895
Greenville ..............................................................
1,391,800
Spartanburg ........................ .................................
156,597
D istrict o f Columbia
W ashington ..........................................................
3,527,321

$

2,661,595
83,475
27,750
382,950
84,313
584,250
424,498
1,699,980
114,100
107,200
1,547,201
264,821
349,348
47,200
443,813
324,873
750,200
739,558
260,775
360,97*
438,900
356,600
148,370
431,887
288,318
506,121
114,950
102,057
3,599,383

D istrict Totals ......................................................$22,458,324
5 Months .............................. .................................$113,502,173

$ 17,245,466
$ 76,540,669

SOFT C O A L PR O D U C TIO N IN T H O U SA N D S OF TON S
May
1948

REG ION S

M aryland

in D istrict

May
1947

15,301
2,035
164
17,500
56,590
30.9

16,711
1,866
167
18,744
56,464
33.2

5 Mos.
1948

5 Mos.
1947

62,284
7,572
695
70,551
230,525
30.6

73,507
7,897
915
82,319
263,646
31.2

%
Chg.
—
+
—
—

8
9
2
7
0

L IN ES

Dry goods (1 5 )* ..............
Groceries (6 4 )* ..............
P aper & products (5 )*..
T obacco & products (8 )*
M iscellaneous (7 1)* .....
District A verage(202) *

15
4
24
14
13

% Change
from
May 1947

Sm oking & Chewing tobacco
(Thousands o f lbs.) .....
15,680
Cigarettes (Thousands) .... 28,497,561
Cigars (Thousands) ..........
444,491
Snuff (Thousands o f lbs.)
3,344

+24
+14
— 6
— 4

22
10
7
3
4
3
3
6
1
7
0

+
—
—
+
—
—
—
—
—
—

R atio M ay
collections
to a cc’ts
outstand’g
M ay 1

+ 8
+ 69
+ 28

0
+ 5
— 11

71
94
90

+ 4
+ 18
+ 12

*0
+ 1
— 5

— 3
+ 38
+ 25

2
5
10
7
10
0
1
8
6
6
5

— 3
0
— 2

116
67
160
104
137
90
99

R E P O R T ON R E T A IL F U R N IT U R E SALE S
Percentage com parison o f sales in
periods named with sales in same
periods in 1947
May 1948
5 Mos. 1948

STAT E S

+20
—2
—6
+ 6
— 4
+ 4
0

Maryland (4 )* ...........................
Dist. o f Columbia ( 6 ) * ..............
V irginia (1 8 )* ...........................
W est V irgin ia (6 )* ..................
N orth Carolina (1 5 )* ..............
South Carolina ( 9 ) * .... ...........
D istrict (5 8)* ......................
Individual Cities
Baltimore, Md., ( 4 )* ............
W ashington, D. C., ( 6 )* ........
R ichm ond, V a., ( 6 } * ..........
Lynchburg, V a., (3 )* ..............
Charleston, W . Va., (3 )* ........
Charlotte, N . C., (4 )* ...... .
Columbia, S. C., (3 )* ..............

+ 10
+ 2
— 3
+ 4
— 4
+ 3
+ 7

+20
2
0
+ 5
—1
3
+ 3
—1
6

+10

+. 2
+ 6

—

— 7

— 4
— 9
+ 1

♦Number o f reporting firms.

D E P A R T M E N T STO R E T R A D E
Richm ond

B altim ore

W ashington

Other Cities

D istrict

P ercentage chg. in M ay 1948 sales, com pared with sales in May 1947:
+ 5
— 5
— 6
+ 3
— 1
Percentage chg. in 5 mos. sales 1948, com pared with 5 mos. in 1947:
+ 5
+ 1
+ 3
+ 6
+ 4

TOBACCO M A N U F A C T U R IN G
May
1948

+
+
+
+
+
—
+
—
—
—

Stocks
M ay 31, 1948
com pared with
M ay 31 A p r 30
1947
1948

S ou rce: Departm ent o f Commerce.
* Num ber o f reporting firms.

c
/o
Chg.
—
—
—
—
—

Net Sales
M ay 1948
com pared with
M ay
A pr.
1947
1948

5 Mos.
1948
80,697
140,315,576
2,285,633
18,028

c Change
/o
from
5 M o s .’ 47

Percentage changes in stocks on May 31, ’ 48, com pared w ith May 31, ’ 47:
— 5
+16
+ 7
+16
+ 9
P ercentage chg. in outstanding orders M ay 31, ’ 48 from M ay 31, ’ 47:
— 25
— 15
— 3
+ 9
— 11

+ 7
+ 5
+ 1
+10

P ercentage chg. in receivables M ay 31, ’ 48, from those on May 31, ’ 47:
+ 38
+18
+17
+21
+21
Percentage o f current receivables as o f M ay 1, 1948, collected in M a y:
31
48
48
51
44
P ercentage o f instalm ent receivables as o f M ay 1, 1948, collected in M a y:
16
23
22
27
22

R A Y O N Y A R N S H IPM EN TS A N D STOCKS
M ay 1948

A p ril 1948

May 1947

69,900,000
23,700,000
8,700,000
3,700,000

67,900,000
. 22,900,000
8.700.000
3.800.000

60.400.000
17.900.000
8.400.000
3.800.000

M aryland
R ayon
Staple
R ayon
Staple

yarn
fiber
yarn
fiber

S o u rce :

shipments, lbs...........
shipments, lbs...........
stocks, lbs.................. .
stocks, lbs...................

Rayon O rganon.




[12]

Dist. o f Col.

V irgin ia

W . V irgin ia

N . Carolina

S. Carolina

Percentage change in M ay 1948 sales from May 1947 sales, by sta tes:
— 5
— 6
+ 5
+13
+ 4
0
Percentage change in 5 m onths 1948 sales from 5 m onths 1947 sales *
+ 1
+ 3
+ 7
+13
+ 5
+ 5


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102