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- F E D tF j/y RESERVE BANKAjFJRICHMOND

June 1953

United

States Population, 1900 - 1960,

with

Selected Percentage Increases

1900

A Ithough population growth is but one of the
i i major factors affecting long-term economic
trends, it is a highly significant one. The article
on page 3 points up areas of potential demand if
the high rate of population increase continues.
The cover chart depicts the population trend since
1900— and three projections to 1960.




Also In This Issue - - Fifth District Trend Charts_____________ Page
Trends in Fifth District
Deposit Ownership___________________ Page
April Call Report_______________________ Page
Business Conditions and Prospects_____ Page
Fifth District Statistical Data___________ Page

2
6
8
9
11

Federal Reserve Bank of Richmond

F if t h

d is t r ic t

T rends

CONSTRUCTION CONTRACT AWARDS

NEW PASSENGER CAR REGISTRATIONS

Commercial construction contract awards in April revived -1\
)f
from the adjusted March level and were back to approximately the
adjusted levels established in February.
Commercial construction
awards in April were 83% ahead of a year ago. In the first four
months of 11)53 this type of award was up 118% above a year ago.

Registrations of new passenger cars in the Fifth District during
March were up 39% from the previous month and 4 0 % ahead of a
year ago. Registrations in three District states for April were 35%,
higher than a year ago which was about in line with the increase
in registrations nationally. Used car stocks are heavy but sales are
likewise running well ahead of last year.

CONSTRUCTION CONTRACT AWARDS

CIGARETTE PRODUCTION

Contracts awarded for factories in this District during
78% higher than in March (on an adjusted basis) and
of a year ago.
April awards were nearly as large as
peak in December.
In the first four months of 1953
factory construction were up 2 3 % from a year ago.

April were
4 3 % ahead
the recent
awards fol­

Cigarette output in April (adjusted) dropped 8 % from the previ­
ous month and 4% below last year. This was mainly due to the
afterm ath of the rise in price of the previous month. In the first
four months of 1053 cigarette output was 2% ahead of a year ago.

CONSTRUCTION CONTRACT AWARDS

COTTON CONSUMPTION

April awards for residential construction were 21% higher than
March (adjusted) but failed by 29% to equal the level of April 1952.
Although the April awards for apartments and hotels (adjusted)
rose 9 6 % , they were still 60% under last year. One- and tw o-fam ily
houses rose 7 % (adjusted) from March to April but the April
figure was 6%, under last year.

The in-between-season month of April in the textile industry
witnessed a reduction of 4% in adjusted cotton consumption from
March, but the April level was 10% ahead of a year ago. In the
first four months of 1953 cotton consumption was 5% higher than a
year earlier.
In this same period cotton spindles were operated at
a rate 11% higher than a year ago.




June 1953

Economic Strength in Prospective Population Growth
may be some question as to how much longer
the business boom will continue, but it appears rea­
sonably certain that the population boom is in stride and
on its way to another record-breaking performance this
decade. It began in the early years of W orld W ar II,
declined some in the mid-Forties, accelerated to a post­
war record rate of growth in 1947, and has surprised
the experts by continuing to grow at a rate just under
the postwar peak. On the first lap of its record-break­
ing performance, the popu­
lation boom added almost
20 million persons to the
nation’s consumers in the
past decade. This was the
largest absolute gain in our
history. It is estimated on
the basis of a number of
different projections that
this mark may be exceeded
this decade with a growth
of 23 million.

to almost 141 million. By 1947 it was apparent that this
projection would fall short of the mark, and a revised
estimate was made of 145 million. Even this short-run
projection failed in approximating the actual count, er­
ring on the low side by 6.7 million.
The increase of almost 20 million persons in the
decade of the Forties was the largest on record and
more than double the depression-stunted gain from 1930
to 1940. Significantly, over half this increase was
packed into the last four
years of the decade when
the birth rate jumped by
more than 25% to reach
the highest level attained
since the early Twenties.
The upsurge peaked in
1947 with a rate of 26.6
births per thousand popu­
lation, compared with a
rate of only 18.4 in 1934
and 1936.
Although the
rate has declined since, the
W hile the gains in such
1947 total of 3.8 million
items as industrial produc­
births was exceeded slight­
tion, employment, and in­
ly in 1951 and again in
come have been in the
1952. Data are available
headlines, the growth in
Under , 0
1
1 -1
09
20-44
45-64 6 ond Over
5
only for the first three
Source 1950-United States Census of Population, t950
population has been re­
i960* "The Sutlaimng Economic Force# A«eodu o report fo the joint committee on tho
Economic Report, p 13.
months of this year, but
ceiving relatively scant at­
the long-expected drop in
tention. Yet, it has been an
births has still not ma­
underlying force as well as
terialized. In the first quarter the number of births was
a reflection of the postwar boom. Tw o significant points
3% higher than a year ago and the birth rate was up
should be noted. First, the impact of the unprecedented
2.5% . A decline, however, is still anticipated, and the
growth in population from 1940 to 1950 has by no
projected population curves shown on the cover chart
means been exhausted. Its effects in promoting shifts
are based on the assumption that the birth rate will de­
and growth in consumption and investment will be felt
cline from 1952 to 1960.
for years to come with undiminished strength. The de­
Based largely on the failure of the rate of population
velopment of the economy in growing up to its greatly
growth to decline in the last few years as anticipated
expanded population is far from completed, and since a
and on indications that the low and medium projections
further large gain in population is due this decade, the
of the Bureau of the Census shown on the cover chart
economy is going to have to move ahead at a high rate
assume unrealistic drops in the birth rate, a report pre­
just to hold its own. Continued improvement in the
pared for the Joint Committee on the Economic Report,
standard of living will require an accelerated rate of ex­
The Sustaining Economic Forces Ahead, estimates that
pansion in production and investment.
by 1960 the nation’s population will be in the neighbor­
In brief, the population changes of the past and pres­
hood of 175 million. The gain for the decade would
ent decades provide the potential for further long-term
be over 23 million as compared with the increase of 20
growth in our economy on a par with, and perhaps in
million from 1940 to 1950. Additional food, clothing,
excess of, the “ abnormally” high levels of recent years.
shelter, transportation, and classrooms will have to be
Twice the Gain of the Thirties
provided for this increment, along with, if the past is
A brief look at the unexpectedly large growth of
any indication, a higher standard of living for the popu­
population in this country from 1940 to 1950 helps ex­
lation in general.
plain why fast-expanding productive capacity found it
Second Highest Regional Gain
difficult to satisfy postwar demand for goods and serv­

T

h ere

ices. The population of the country in 1940 was 132
million, and it was estimated that by 1950 it would be up




A n important factor to business in the growth of
population is the geographical shifts that occur, creat­
■3 y
{

Federal Reserve Bank of Richmond
the inability to make much progress, relatively, after
the war l>ecause of the shortages of labor and materials.

ing new market patterns and opportunities for new and
expanded industries and distributive facilities. The eight
states of the South Atlantic Division* including the
five Fifth District states, recorded the second largest
regional gain in population from 1940 to 1950, 18.8rr
as compared with 14.5% for the nation. Maryland and
Virginia were among the ten states having the greatest
percentage increases, the former seventh in the nation
with a growth of 28.6% and the latter tenth with a gain
of 23.9% .
The projected population growth will be marked by
continued population shifts toward the Far West and
the Southeast. However, there is some question that
the District's growth will be as large relative to the
nation's as it was during the past decade when expansion
of Federal Government activity had such a marked im­
pact on the population growth of Maryland and Vir­
ginia. Nevertheless, the Bureau of the Census expects
the District of Columbia, Maryland, and Virginia to re­
alize higher percentage gains than the average tor the
country. It expects also that these gains will more than
offset the smaller-than-average growths in W est Vir­
ginia, North Carolina, and South Carolina, with a net
addition to the District’s population of around 2 million
this decade. Such a growth would be the equivalent of
the 1950 total population of the three largest cities in
the District— Baltimore, Washington. D. C., and Rich­
mond.

The point does not need to be la1x>red. Everyone is
familiar with the overcrowding, double shifts, and con­
version of such facilities as jails, poultry* houses, school
buses, garages, and churches into classrooms. The first
progress report of a survey of school facilities conducted
by the Office of Education of the Federal Security Agen­
cy reveals that 6% of the reporting states' school chil­
dren attend classes in quarters not designed for such use,
7% are housed in buildings over 50 years old, 20% are
in buildings rated unsafe because of fire risk, and 21 %
attended classes in buildings with antiquated or no in­
door sanitary facilities.
Despite the unprecedented volume of funds expended
on school construction in the last few years, only meager
inroads have been made on accumulated needs. Based
on data from the survey mentioned in the preceding
paragraph and from the Department of Commerce,
school construction contracts awarded in 1952 were only
19%. of estimated needs in 1952 in Maryland, 12% in
W est Virginia, and 7% in North Carolina. Data are
not at hand for the other states of this District, but it
has been indicated that similarly low ratios hold also in
Virginia and South Carolina.

The Three R’s in Jails, Service Stations,
and Chicken Houses

One of the aspects of recent and prospective imputa­
tion growth that indicates continuing needs for capital
outlays of boom-like proportions in certain fields the
rest of this decade is shifts in age groups. As shown on
the accompanying chart, the estimated increase in total
population between 1950 and 1960 will occur unevenly
among various age groups. In the two groups, tinder
10 years and 10 to 19 years, the increase is expected to
be around 12.5 million. This additional potential school
load will confront local education boards already strug­
gling with the problem of inadequate school facilities
and the wherewithal with which to expand them. The
problem has been accentuated by its relatively sudden
emergence. Due to the declining number of births dur­
ing the early Thirties, the effects of the depression, and
military drafts and job opportunities of the war years,
there was a net decline in enrollment in elementary and
secondary schools over the last two decades. With
the opening of the current decade the situation was
sharply reversed, and school enrollment began to in­
crease at the rate of a million a year. The war babies
had begun entering school, but unfortunately facilities
were inadequate for the increased load. In fact, the
school plant in most states was inferior to what it had
been prior to the war. This was a consequence of the
lack of maintenance and addition during the war and




i 4 y

Referring to 1952 needs only, the survey makes the
following national estimates: new construction $9.4 bil­
lion, remodeling and rehabilitation $535 million, site
acquisition $498 million, and new buses $165 million.
Taking into account the increase in enrollment expected
between 1952 and 1960, it has been estimated (The
Sustaining Economic Forces Ahead) that additional new
construction amounting to $6 billion will be needed, and
that replacement in the same j>eriod will require outlays
of $4 billion. All told, estimated current and prospec­
tive school needs call for total outlays of almost $21 bil­
lion by 1960. On an annual basis this would be $2.3
billion— which if actually expended would be a strong
offset to any likely downturn in, say, residential con­
struction.

From Abnormal to Normal?
Residential construction deserves particular attention
in a survey of prospective economic activity because it
has been singled out to an increasing extent lately as one
of the props of the boom that may soon decline in
strength. It is pointed out that the annual growth in
number of households and families, a key to housing de­
mand, has been declining since 1951 and that the indi­
cated trend through most of this decade is downward.
Hence, it is argued, the abnormal demand for housing
in the postwar period will soon be in the limbo of past
glories of a boom.
After the close of World W ar II, new households
were formed at a very high and rising rate. The growth
reached a peak in 1948 when the net increase topped

June 1953

1.5 million, but since then the rate of household forma­
tion has dropped over 4 0 ^ , being estimated at 900,000
for the year ended April 1952. The primary reason
for the decline stems from the low birth rates of the
Thirties which are now' being reflected in reduced num­
bers of persons of marriageable age. Toward the end of
this decade the number of persons reaching marriageable
age will l>egin to increase, and in the late Sixties the
country is likely to experience the greatest increase in
its history. This should give rise to a housing boom
that may make the number of residential starts in recent
years suffer in comparison.
In the meantime, however, it is not at all certain that
housing construction will decline sharply. To begin
with, the estimated increase of some 23 million persons
this decade will have to be housed. A reasonable esti­
mate of new residential units called for by this growth
can be based on recent experience regarding the size of
households. In addition, prospective housing activity
will be influenced by the number of replacements, ex­
penditures on maintenance, and rehabilitation of sub­
standard units. Taking all these factors into account,
the Housing and Home Finance Agency has estimated
that close to 1.5 million nonfarm units will be needed
each year of this decade. A more recent estimate (see
The Sustaining Economic Forces Ahead) sets annual
housing needs in the eight years to 1960 at 1.2 million.
These are estimates of needs, not effective demand.
Nevertheless, they are indicative of the possibility that
the “abnormal” housing activity of the past four years,
resulting in average annual starts of almost 1.2 million
units, could become a normal level of activity the rest
of this decade.

$2.5 Billion vs $866 Million
Another area in which the prospective increase in
population is going to accentuate an already tremendous
backlog of needs is hospital facilities. Despite expendi­
tures on hospital construction averaging $803 million
annually in the three years, 1949-51, almost two and
one-half times the average in the preceding three-year
period, it has been estimated that at the opening of 1952
the backlog of needed hospital construction amounted to
$14 billion. Although this is an estimate, based on
data submitted by each state as required by the Hospital
Survey and Construction Act, it is indicative of the gen­
eral level of current needs.
Alxmt $1.9 billion of this backlog represents the cost
of providing veterans’ hospitals and hence a Federal
Government obligation if and when undertaken. The
Joint Committee report previously cited estimates that
in order to clean up most of the remaining backlog by
1960 at “about as fast a rate as appears feasible while
keeping up with increasing population and offsetting
continuing obsolesence/’ about $2.5 billion of new con­
struction would l>e required annually from 1954 to 1960.
This is in striking contrast to the $866 million of hospi­




tal construction estimated to have been put in place in
1952.
The same report provides data showing that as of
January 1, 1952, the additional hospital facilities needed
in the Fifth District would require outlays of almost
$1.5 billion. In contrast, the total amount of bond
offerings in the Fifth District in 1952 for all types of
capital projects was only $422 million. And note that
the $1.5 billion figure makes no allowance for replace­
ment or growth of population in the years immediately
ahead.

Needs Not Effective Demand
Space permitting, other areas of activity could 1 e ex­
>
amined to assess the potential growth latent in current
needs and stemming from the impact of prospective
growth in population. Public utilities, highways, busi­
ness plant and equipment, new industries, suburban re­
tail outlets are all influenced to a considerable extent by
growth and geographical shifts in population. If the
flow- of investment in recent years should be measured
against the accumulated needs and the demand arising
from all these sources, the postwar boom would not ap­
pear as abnormally high as is indicated by historical
comparisons.
The feasibility of the needs spoken of should l)e con­
sidered in terms of effective demand— willingness and
financial ability. Obviously, the latter could fall far
short of effectuating the potential growth indicated by
current needs and prospective increases in markets.
Nevertheless, if the economy is to go forward— or even
hold its own— business and government must shape
their current and future operations and plans for capital
projects to fit the new sociological and economic pattern
that emerged from World W ar II. There is little justi­
fication now for economic myopia; the pessimism of the
Thirties regarding opportunities for growth has been
dissipated by the dynamic nature of the growth in popu­
lation and the peremptory drive of the population for an
ever-l)etter standard of living. An increase of 20 mil­
lion in the population during the Forties— more than
double the gain in the preceding 10 years— and an ex­
pected further increase of 23 million this decade sets an
economic stage on w
’hich opportunity and growth should
have featured roles.

Recommended reading on this subject: The
Sustaining Forces Ahead, prepared by the staff of
the Joint Committee on the Economic Report, 1952 ;
U . S. Department of Commerce, Markets After the
Defense Expansion, 1952; G. Colm, The American
Economy in 1960, National Planning Association,
1952; Joseph S. Davis, Our Changed Population
Outlook and Its Significance, American Economic
Review, June 1952.

Federal Reserve Bank of Richmond

Trends in Fifth District Deposit Ownership
ownership of demand deposits of individuals and busi­
ness firms. These periodic surveys, in addition to
providing further insight into our economic structure
and significant changes in it, also provide a means
whereby individual banks may make comparisons of
their own dej>osit structures with the average for banks
of similar size in the District.
All categories of individual and business demand de­
posits increased in this District from January 1952 to
January 1953 with one exception— foreign demand de­
b i t s , a relatively insignificant category in the District,
declined by 15% to $12,000,000. The increase in the
District came primarily from the extension of loans by
commercial banks here. Member hanks, which hold
over 70% of total loans and investments in the District,
expanded their loans outstanding by $229,000,000 from
January 1952 to January 1953. Additional expansion
in demand deposits resulted from loans extended by
nonmenil)er banks, from transfers of funds from other
districts, and from U . S. Treasury expenditures here
of funds realized from the sale of Government securities
to banks.
This widespread increase in deposit balances carried
with commercial banks reflected the need for greater
“cash*' holdings than formerly to transact the increased
level of business and personal economic activity. More
active use (more rapid turnover) of deposit balances
and of currency is another means of providing funds
for increased activity and this reduces the need for the

and business firms had $300,000,000
more money in demand deposits with commercial
banks in the Fifth Federal Reserve District on January
31, 1953 than a year earlier. They had $1,373,000,000
more than in January 1946, their total “cash in the
bank” on the current date amounting to $5,401,000,000.
Wholesale and retail traders, manufacturing and min­
ing firms, and other nonfinancial businesses held 45%
of this near-record total on the banks* books at the end
of January. This group of depositors have maintained
about this same percentage of the total throughout the
postwar years.
Financial business concerns have achieved a signifi­
cant increase over the postwar period in their share of
total demand deposits of individuals, partnerships, and
corporations at commercial banks in this District. Fi­
nancial businesses, including insurance, investment, fi­
nance, and real estate companies, increased their de­
posits from $270,000,000 in January 1946 to $487,000,000 in January of this year— from 6.7% of the total to
9 .0% . Personal accounts of individuals, on the other
hand, although increasing by $433,000,000 over the
seven-year period, declined from 40.5% of the total to
38.3% .
The principal characteristics of demand de|>osit own­
ership in this District are presented in the accompany­
ing tables. These figures are based on estimates which
are derived from a sample of commercial banks in the
District which participate in the annual survey of the

/

x d iv id u a ls

O W N ERSH IP OF DEM AND DEPOSITS
OF IN D IV ID U A LS, PARTNERSHIPS, AND CORPORATIONS
All Fifth District Commercial Banks
(In millions of dollars)
Amount
Change
__From Year Ago
Per Cent of Totals
Outstanding
Dollar Per Cent
Jan. *53 Jan. *52
Jan. ’53 Jan. *52 Jan. ’46
Type of Holder
2,894
2,715
+179
+ 6.6
53.6
53.2
Total business....................................
53.0
2,407
2,266
+ 141
+ 6.2
44.6
44.4
Nonfinancial business--------------46.3
726
693
+ 33
+ 4.8
13.5
M fg. and m ining____________
13.6
13.1
286
259
+ 27
+10.4
5.3
Public utilities ..........................
5.1
5.7
1,006
967
+ 39
18.6
Trade ____________ __________
+ 4.1
18.9
22.0
389
347
+ 42
+ 12.0
7.2
Other nonfinancial --------------6.8
5.4
487
449
+ 38
+ 8.4
9.0
Financial business-------------------8.8
6.7
138
127
+ 8.4
Insurance companies................
2.5
2.5
1.8
+ 11
322
349
+ 27
+ 8.5
Other financial ...... ...................
6.5
6.3
4.9
2,066
1.978
+ 88
+ 4.5
Personal ............... ............................
38.3
38.8
40.5
+ 2.6
438
427
8.1
8.4
Farm ers....................... ..................
8.7
+ 11
1,629
1,551
+ 5.0
+ 78
Others..............................................
30.2
30.4
31.4
98
82
+20.1
Trust funds.........................................
1.8
1.6
1.7
+ 16
330
312
Nonprofit associations ....................
+ 5.8
6.1
6.1
4.8
+ IB
12
14
Foreign ................ ..............................
-1 4 .7
2
.2
.3
.1
T ota l.....................................................




57401

5,101

A6 Y

+300

+ ” ^9

100.0

Toiho

loolo

June 1953
Business firms, not including financial types of busi­
ness, held $2,407,000,000 on deposit with Fifth District
commercial banks at the end of January this year, $141,000,000 more than in January a year ago. Certain
service-type industries such as theatres and other places
of amusement, hotels, garages, and laundries (which
are classified in the survey as “ All Other Nonfinancial
Businesses" ) accounted for the largest dollar and per­
centage increase over the year in the nonfinancial busi­
ness category. These firms held $42,000,000 more on
deposit with District banks this year than last, an in­
crease of \2c ( to $389,000,000. Public utility, trans/
j>ortation, and communications firms also showed a large
increase from a year ago. On the 1953 date, their de­
mand deposit balances totaled $286,000,000, \0l 2c<
/ /
more than in January 1952.

creation of new money to facilitate increased business
activity. Historically, however, increased economic ac­
tivity has been accompanied by increases both in the
supply of money and in the rate at which existing money
is being used. Two of the many factors which bring
this alxmt are the institutional forms of credit exten­
sion and the customs and habits of society in the mak­
ing of payments.
D E M A N D D E P O S IT O W N E R S H IP — F IF T H D IS T R IC T
B Y S IZ E O F C O M M E R C IA L B A N K S
P E R C E N T A G E H E L D B Y P R IN C IP A L C L A SSE S O F O W N E R S
January 31* 1953
_________ Deposit Size o f Banks*_________
$10,000,000
$1,000,000Less than
and over
$10,000,000
$1,000,000
Type of Holder
Total business -----------------Nonfinancial business ...___
M fg. and mining ___
Public u tilitie s --------Trade -------------------- ~
___
Other nonfinancial
Financial business ____ ___
Insurance companies .___
Other fin a n cia l_____ ___
Trust fu n d s --------------------Nonprofit associations __ ____
......
P e rso n a l--------Foreign
..
—
—

32.2
28.8
5.3
1.7
15.9
5.9
3.4
1.3
2.1
0.4
3.5
63.9
-------

T o ta l----------------------------------___ 100.0

47.0
41.0
12.5
3.2
18.9
6.4
6.0
0.9
5.1
0.8
3.8
48.4
--------

100.0

61.4
49.3
15.2
7.3
18.8
8.0
12.1
4.0
8.1
2.8
8.3
27.1
0.4

Nearly three-fourths of the demand deposits of all
types of business firms are owned by incorporated con­
cerns. Among the nonfinancial businesses, incor­
porated firms held 7\c< of the total on January 31,
/
1953, and in the financial business category they held
78% of the total. In each case the increase in deposit
balances over the year was greater in the corporate
forms of business than in the noncorporate forms. De­
mand deposits of financial noncorporate firms declined
by nearly 6% over the year, while incorporated financial
businesses increased their balances by over 11% .

100.0

* Total deposits o f Individuals, partnerships, and corporations held
on December 31, 1945.

Commercial banks are the traditional lenders of mon­
ey, and because of the organization of our banking sys­
tem the extension of new loans generally results in the
creation of new deposit money. In addition, some new
money is called for because the timing of salary, wage,
rental, and many other types of payments follow longestablished patterns— weekly, semimonthly, monthly,
etc. The timing of so many payments acts as a drag
on the increasing use (velocity of turnover) of money,
and new' money is needed to permit a higher level of
exj>enditures for the economy.

D E M A N D D E P O S IT O W N E R S H IP — F IF T H D IS T R IC T
B Y S IZ E O F D E P O S IT A C C O U N T
P E R C E N T A G E H E L D B Y P R IN C IP A L C L A SSE S O F O W N E R S
January 31, 1953
Size o f Demand Deposit Accounts
Type o f Holder

Total business _________ __ ....
Nonfinancial business ....
M fg. and m in in g -----Public u tilitie s-----------Trade __________________
Other nonfinancial —
Financial business
In su ran ce____________ _
Other fin a n cial______
Trust fu n d s ---------------------- .....
Nonprofit associations —
Personal
~
___
Foreign ___________________

Increase in Deposit Balances Widespread

Financial businesses held $38,000,000 more on de­
posit at Fifth District commercial banks on January 31,
1953 than on that date a year ago. This increase in
their bank balances raised their proportion of the total
of District demand deposits of all individuals, partner­
ships, and corporations slightly to 9 % , continuing a trend
which has been experienced throughout the postwar
years, not only in this District but in other parts of the
country as well. The relatively more rapid growth in
deposits of financial concerns reflects both sides of the
ever-expanding consumer credit and individuals' liquid
savings picture. Increased activity of sales finance and
personal loan companies is accompanied by larger cash
working l)alances, on the one hand, while the continuing
high level of personal savings in the form of life in­
surance payments and the purchase of savings and loan
shares leads to increased bank balances held by these
tyi>es of businesses.




T o t a l _____________________ _

$10,000$25,000

$25,000
and over

30.7
26.9
3.2
1.3
17.3
5.0
3.8
0.4
3.4
0.1
3.4
65.8

55.6
46.4
9.1
2.7
24.0
10.6
9.2
1.8
7.4
0.3
5.3
38.7
0.1

76.1
61.9
25.1
10.1
18.3
8.4
14.2
4.9
9.3
4.0
9.1
10.3
0.5

100.0

100.0

100.0

Less than
$10,000

Individuals had considerably more money in their
personal accounts at District commercial banks on the
survey date in 1953 than a year ago, an increase of
$88,000,000 raising their total balances to $2,066,000,000. The percentage increase over the year, however,
was less than the average for all types of accounts so
that personal deposits represented a smaller percentage
of the total in 1953 than in 1952. These accounts have
exj>erienced a moderate decline in relative importance
since 1947 when they came to 41.2% of total demand
deposits of individuals and business firms. This year
they made up 38.3% of the total.
J

rr

i

n ♦f

Federal Reserve Bank of Richmond
April Call Report
T \ e p o s ito r s

represents a loss of reserve funds to other parts of the
country.
Member banks had to dispose of nearly $170 million
of L\ S. Government securities over the period in order
to meet the needs of their depositors. Reduction of
$123 million in Treasury Bills held provided most of
the funds realized from this source. The banks also
reduced their holdings of all other classes of Federal
securities except nonmarketable bonds.

liquidated their demand accounts carried

JL s with Fifth District member banks at a faster clip
over the first four months of this year than in any of
the other post World W ar II years, after having raised
their balances to the highest level ever attained on De­
cember 31, 1952.* The combined statements of con­
dition provided by all the District's member banks as
of April 20, 1953 reveal that withdrawals, occurring in
all the principal categories of demand deposits, totaled
$432 million since the first of the year. Individuals
and business firms reduced their demand balances with
member banks here by $271 million in this period, while
bankers cut their accounts at other banks by $111 million.
The summary balance sheet presented on this page
reveals how the District's bankers met their customers'
demands for funds. Approximately $39 million of the
funds drawn out of demand accounts was redeposited
in time deposits at the District's member banks. About
$390 million represented a loss of cash or of balances
carried with other banks as shown by a reduction of
$222 million in the balances held in these accounts and
of $167 million in U. S. Government securities. Balances
that the District’s member banks have on deposit at
other banks were reduced by $92 million from the first of
the year to April 20. O f this loss, $17 million represented

E A R N IN G A SSE T S
F IF T H D IS T R IC T M E M B E R B A N K S
(millions of dollars)
Dec. 31,
1952
Loans and Discounts (Gross)
2,299.1
Commercial and industrial
Iran*
827.7
Loans to farmers ___________
54.6
Loans to brokers and dealers
in secu rities_______________
13.4
Other loans for purchasing
and carrying securities ......
102.5
Real estate loans:
On farm la n d _____________
47.3
On residential p ro p erty __
416.2
On other properties______
152.7
Instalment loans to individuals:
Retail automobile p a p e r__
150.9
Other retail p a p e r ________
61.2
Repair and modernization
loans
..
.....................
35.9
_____ _______
Cash loans
93.2
Single payment loans ______
277.5
Loans to banks _____
_
_
5.4
All other lo a n s _____________
60.6
U . S . Government Direct Obli­
gations ____________________
2,631.9
Treasury b ills ________________
353.1
Treasury Certificates o f In­
debtedness _________________
235.9
Treasury notes ................ ........
472.9
Nonmarketable bonds________
141.9
Other bonds maturing within
5 years o f call report date
829.0
Other bonds maturing in over
5 y e a rs____________________
599.0
Other Securities ........
.... ....
428.7

.. ..... .

SU M M A R Y B A L A N C E SH E E T
F IF T H D IS T R IC T M E M B E R B A N K S
December 31, 1952 and April 20, 1953
(millions o ! dollars)
A pr. 20,
1958

Change
12 31 52
4. 20 53

A SSE T S:
Reserves, cash and bank bal­
ances ----------------------------------Loans and discounts (incl.
overdrafts and less reserves
for lo s s e s )-------------------------U. S. Government securities
Other securities--------------------A ll other a sse ts______________

1,915.3

1.693.0

-2 2 2 .3

2,273.3
2,633.7
426.8
89.1

2,339.4
2.466.6
429.2

4 - 66.1
— 167.1
+
2.4

Total a sse ts__________________

7.338.3

90.5..
7.018.7

A pr. 20,
1953

Change
1 2/31/52
to 4 /2 0 /5 3

2,365.6

+

66.5

830.1
65.4

+
+

2.4
10.8

15.9

•f

2.5

103.9

+

1.4

49.0
414.9
157.0

+
—
+

1.7
1.3
4.3

164.3
72.7

+
+

13.4
11.5

37.1
97.3
283.5
10.9
63.6

+
+
+
+
+

1-2
4.1
6.0
5.5
3.0

2,464.9
230.6

— 167.0
-1 2 2 .5

200.4
465.9
143.4

— 35.5
— 7.0
+
1.5

826.2

—

2.8

598.3
431.0

—
+

0.7
2.3

—319.6

L IA B IL IT IE S :
—
Demand d ep osits------------------5,323.6
Time d eposits________________
1,472.9
B orrow ings__________________ 5.1
Other lia b ilitie s____________ 60.8
Capital accou n ts------------------475.9
Total liab ilities______________
N ote:

7,338.3

4,891.2
1,511.4
72.5
55.5
488.1
7,018.7

Although total assets of all member banks in the Dis­
trict were reduced by $320 million, bankers here met
customers' demands for loans in a larger total amount
than in the comparable period last year. The increase
in total loans outstanding of $66 million was spread over
nearly all categories of borrowers. Real estate loans
011 residential property was the only category showing
net repayments. Instalment loans to individuals ac­
counted for nearly half the total loan increase : and
about one-half of these instalment loans went for the
purchase of automobiles.
The sale of Government securities and the increase
in loans altered somewhat the asset structure of District
meml)er banks. Loans and discounts, which accounted
for 4 3 ^ of total earning assets at the beginning of the
year were raised to 4 5 '* , while Government securities
dropped from 49' < to 479r of the total.
/

-4 3 2 .4
-r 38.5
+ 67.4
5.3
-3 1 9 .6

May not add to totals because o f rounding:.

a reduction in reserve balances held with the Federal
Reserve Bank of Richmond. Additional reserve funds
were realized from borrowings from the Reserve Bank,
so that the total of reserve funds lost in the period
amounted to approximately $84 million. Since all the
factors within the District which affect member bank
reserves operated to increase them over this period, this
♦The article on page 6 discusses the increase over 1952 by principal
classes o f owners.




• 8 y
{

June 1953

Business Conditions and Prospects
primarily responsible for the high level of
activity in the Fifth District continued to show
strength during April. The construction industry— one
of the strong props in the District as well as in the na­
tional economy— continued to be very active in April,
though largely in the nonresidential sector.
Durable consumer goods sales, particularly in the
passenger automobile field in March ran 40% ahead of
a year ago and two states showed April gains of 19%
and 4 6% . Although furniture store sales (adjusted)
receded somewhat from the previous month, they were
still moderately ahead of last year. Department store
sales dropped moderately below April of last year but
this was due to the shift of Easter. March and April
combined were well above last year.
Machinery and transportation industries continued to
operate near peak levels. Seasonal letdowns have been
noted in textile and apparel lines, but the slackening so
far is nothing more than seasonal. Bituminous coal
output in the District appears to be holding its own at
a level 19% under a year ago as the effects of last year’s
exports and the mild Winter fade into the background.
Although employment is still at peak levels in the
transportation equipment and machinery industries, the
stimulative effects of defense expenditures in the Dis­
trict have been substantially reduced from a year ago.
Defense contracts awarded to Fifth District firms in the
first quarter 1953 were 33% under the same quarter a
year ago. Federal defense budget cutbacks, which apl>ear likely, may well have moderately adverse effects
on 1x>th construction and shipbuilding in this District.
In the financial sector, District member bank loans
continued their uptrend though the April gain was only
1% . The weekly reporting banks, however, showed
business and real estate loans leveling off near their
all-time peak while consumer loans continued their
sharp rise. Time deposits of all member banks rose
0.6% during April while demand deposits, excluding
interbank, declined 3 .7% . Borrowings from the Fed­
eral Reserve Bank continued heavy, and at the end of
April were 85% above a month earlier and 156% ahead
of last year.
a c to r s

F

Construction

Construction contract awards in April rose 32%
above March (after seasonal correction) to a level 5%
ahead of a year ago. Sharp changes occurred between
March and April in all sectors except one- and twofamily houses. Relative to a year ago, however, all
the nonresidential sectors showed gains, with commer­
cial structure awards up 8 3% , factory awards up 4 3 % ,
and public works and utilities awards up 7 2% . The
substantial gain in public works and utilities was due
to the awarding of two large contracts for dam construc­
tion near Roanoke Rapids, X . C.



Although awards for apartments and hotels nearly
doubled from March to April, they were still 60% under
April last year. Awards for one- and two-family houses
rose 7% more than seasonal from March to April but
were 6% under a year ago.
In the first four months of 1953 nonresidential con­
struction awards in the District were up 30%., with
commercial up 113% , factory up 2 7% , education off
, and other nonresidential up 4 8 % . In this same
period residential construction awards were down
22.5% , with apartments and hotels down 52% , oneand two-familv houses down 9% and other residential
down 6 5% . Awards for public works and utilities in
the four months were up 39% from last year and total
construction contract awards were up 5 % .
Due to the economy drive, the Air Force has recently
eliminated $146 million from its planned construction
program. Among the projects dropped are the RaleighDurham Municipal Airport on which $19 million had
teen scheduled for expenditure; the Seymour-Johnson
Field at Goldsboro, N . C , $9.7 million; Mvrtle Beach,
S. C. airport, $9.2 million. The Army and Navy are
reworking their construction programs and it may be
that some of their Fifth District projects will likewise
be eliminated.

Textiles
April is usually an in-l)etween-season month in the
cotton textile industry, and this year was no exception.
Cotton consumption dropped 4 % more than seasonal
from March but continued 10% higher than in April
1952. Weakness in contract prices around the middle
of April turned into strength by the end of the month
when a substantial amount of forward coverage was
effected. Prices early in May had more than recovered
previous losses. The industry is fairly well sold up on
its third quarter production of goods but sales yarn
backlogs have declined moderately. Yarn prices, how­
ever, have shown no weakness as a result, and with the
industry in general facing a fairly optimistic outlook
for the third quarter, the chances are yarn spinners will
do fairly well in this period. Current strength in the
industry can be attributed mainly to its attaining high
style apparel preference over synthetic products— a situ­
ation the synthetics could not be expected to take sit­
ting down. In fact they are organizing to regain their
previous position and the intensified competition will l>e
interesting to say the least.
In April the statistical picture in synthetics showed
shipments of rayon and acetate yams 29% higher than
a year ago, with filament yams up 36% and staple and
tow up 12% . In the first four months of 1953 filament
yarns were 31% ahead of similar months of 1952, while
staple and tow shipments were down 9C .
<
‘

i 9Y

Federal Reserve Bank of Richmond
Apparel manufacture in this District was at an alltime high level in March and continued during April
ahead of a year ago but seasonal factors were respon­
sible for some letdown in April.
The hosiery industry is at its period of seasonal reces­
sion though production is continuing well ahead of a
year ago. Some indication of future price weakness
in full-fashioned has appeared lately but it is not be­
lieved that this will become general.

Trade
Maintenance of current levels ot business activity both
in the District and the nation obviously depends on con­
tinuing demand for goods by the consuming public—
and this composite demand is reflected in the level of re­
tail trade. The durables segment of retail trade is cur­
rently at an inordinately high level, high both in histori­
cal perspective and in relation to consumer income. A
substantial portion of these durable consumer goods
sales are dependent upon consumer credit. Money is
tight at the present time and it is an interesting question
as to whether consumer credit will be available— and at
an attractive price— to maintain the sales level which
durable goods have recently attained.
Thus far. District automobile sales have shown a sub­

F if t h

stantial revival from last year, and though still well un­
der the August 1950 peak, they are only exceeded by
eight individual months of 1950. Indications are that
the automobile sales rise has continued in May and will
carry through June.
District furniture store sales ( adjusted ) dropped 6%
from March to April but were a modest 1% ahead of
April 1952. This is a good performance in view of a
drop of 22% in residential construction contracts dur­
ing the first four months of the year. Furniture store
inventories were down 1% (adjusted ) trom March and
were 7'.'r higher than a year ago. Accounts receivable
were up 17% from last year.
Average daily department store sales (adjusted) in
the District were down 6 c from March but remained
/c
4% ahead of a year ago. Dollar sales in April, with­
out correction for Easter or working days, were down
1.8% from last year but the combined March-April
sales were up 3.2%,. Department store inventories (ad­
justed) rose 4% from March to April and were 11%
ahead of a year ago. Disregarding the individual
month's changes, the general trend of inventories is
about in line with that of sales and no particular con­
cern should l>e felt over inventories, providing the sales
level continues on its upward trek.

d is t r ic t b a n k in g

Dist. of Columbia
_
W ash in gto n ___ _ $1,034,086
Maryland
_
Baltimore --------_ 1,395,668
_
25,484
Cum berland------_
23,373
F red erick --------- ___
38,958
Hagerstown ----- ___
North Carolina
___
58,649
A sh eville _______
.
354,563
Charlotte
82,884
D urham -------------___
G reensboro------- ___124,218
18,666
K in sto n ________ ___
180.762
Raleigh
...........
___
45,673
Wilm ington ___
15,044
W ils o n _________
138,746
W inston-Salem .___
South Carolina
78,394
Charleston______
166,545
C o lu m b ia _________
111,555
Greenville ......—
62,366
Spartanburg — ___
Virginia
28,058
Charlottesville ___
Danville ..
36,997
48,840
L yn ch b u rg------- ___
48,486
Newport News .___
262,640
N orfolk
.
32,191
Portsmouth ___ ___
612,290
R ichm ond_________
120,123
Roanoke _______ ___
W est Virginia
42,574
B lu efield _______ ___
164,329
C h arlesto n ____ ___
32,784
C larksburg------- ___
69,957
H u n tin g to n ----- ___
30,702
Parkersburg----- ___
District T o ta ls __ ___$5,485,605




t a t is t ic s

50 R E P O R T IN G M E M B E R B A N K S

D E B IT S T O D E M A N D D E P O S IT A C C O U N T S*
(000 omitted)
April
April
1952
1953

S

(000 omitted)
4 Months
1953

4 Months
1952

$1,050,843

$ 4,128,643

3 4,350,101

1,281,970
26,893
22,491
34,686

5.530,620
101,384
92,514
147.156

4.971.069
98,847
£7,803
137,480

57,095
322,943
75,049
103,899
17,671
191,204
43,184
16.504
121,063

242,171
1,448,670
340.069
470,734
80,369
798,777
179,685
67,361
578.865

240,718
1,365,741
313,020
420,181
74,966
709,157
173,928
71,281
513.973

75,499
148,320
101,542
66,077

322,068
632,781
450,227
260,708

297,889
566,639
414,658
270,565

24,008
30.620
42,003
43,569
234,622
26.041
554,683
111,026

101,029
151,435
192,806
195,396
1,020,461
122,260
2,419,352
477,405

96,968
131.969
174,126
183,566
951,340
105,326
2,220,594
450,633

44,495
151,154
31,385
68,873
29,485
$5,148,897

175,878
658,112
138,517
285.802
117,290
$21,928,545

203,878
639.854
147,130
286.135
117,565
$20,787,100

Change in Amount From
May 13,
A pril 15,
May 14,
Items
1953
1953
1952
Total Loans ____________________ $1,398,530** 4 - 4,547
+201,561
Bus. & Agric______ __________
646,811
4 - 3,150
4 - 76,909
Real Estate L o a n s___________
259,272
312
4* 13,589
All Other L o a n s --------------------508,668
4*111*555
4* 1,040
Total Security H o ld in g s______ 1,684,711
U . S. Treasury B ills__________
110,679
U . S. Treasury C ertificates__
119,569
285,410
U . S . Treasury N o te s________
U . S . Treasury B o n d s______
941,271
Other Bonds, Stocks & Secur. 227,782
Cash Items in Process o f Col. _
312,562
Due From B a n k s_______________
173,071*
Currency and Coin —
81,955
Reserve with F . R . B a n k s_____
562,650
Other A s s e ts ----------- ------------ -----58,872
Total A sse ts__________________ 4,272,351

—
—
—
•f
-444-f
-

57,284
58,680
3.646
3,215
3,228
1,401
16.984
8,676
4,531
9,084
2,771
62,011

—140,535
— 153,867
— 50,435
1,071
4 - 64,699
4139
+ 18,322
—
331
4 - 3,251
+
8,260
4* 3,762
4- 94,290

Total Demand D e p o sits---------- 3,226,500
Deposits o f In d ividu als_____ 2,440,701
Deposits o f U . S. Government
81,826
Deposits o f State & Local Gov. 191.308
Deposits o f B a n k s----------------450,062*
Certified & Officers* Checks ~
62,603

— 100,677
2,550
- 62,603
— 9,588
- 11,446
— 14,490

+ 21,945
4 - 55,873
- 25,861
—
104
— 7,431
532

Total Time D e p o sits___________
675,340
Deposits o f Individuals_____
595.961
Other Time Deposits — .........
79,379
Liabilities for Borrowed Money
56,700
43,244
A ll Other L ia b ilitie s___________
Capital A cco u n ts----------------------270,567
Total Liabilities ..... - ............ ~J$4,272,351

- f 2,936
4 - 2,670
4266
4 - 33,500
4146
4* 2,084
- 62,011

4>
4—
4+
44-

* N et figures, reciprocal balances being eliminated.
*♦ Less losses for bad debts.

< 10 )
•

25,004
25,073
69
25,900
8,962
12,479
94,290

June 1
953

F ifth

S tatistical

d istr ic t

SE L E C T E D IN D E X E S

B U IL D IN G P E R M IT F IG U R E S

A vg. Dally 1935-39=100— Seasonally Adjusted

A pril
1953

% Chg.—
A pr.
1953

M ar.
1953
215
490

Latest M o.
Y r.
Prev.
A go.
M o.
+39

A pr.
1952
169
455
139
506r

Automobile Registration*
Bank Debits
486
Bituminous Coal Production
111
112
Construction Contracts _____
533
405
i i
Business Failures— N o ._____
40
47
66
Cigarette Production ________
224
243
233
± xi
Cotton Spindle Hours .
163
158
139
—3
Department Store S a le s**___
— 6
115
404
Electric Power Production___
380
0
Manufacturing Employment*
158
151
194
181
Retail Furniture: N et Sales
183
±5
394
—2
L ife Insurance Sales _________
343
388
* N ot seasonally adjusted.
** 1947-1949=100.
Back figures available on request.

t l

— 19
+ 5
-2 9

Sales in
A pril 1953
Compared with
M ar.
1953

t u
.
t l3

Stocks on
A pril 30, 1953
compared with
A pr. 30, M ar. 31,
1953
1952
— 4

- 1

±?

i i

— 7

2

—18

*1

+27
+23

—1
± !
-

± i
7

I 2

6

—

4 Months
1953

4 Months
1952

$ 3,901,135
30,550
97,406
147,207
111,937

$ 24,666,860
187,900
929,297
1,023,263
405,926

$ 18,663,765
93,650
1,054,763
507,798
393,661

-

7

0
0

+11

4

Number o f reporting firms in parentheses.
Source: Department o f Commerce.

Virginia
D anville_______
Lynchburg ___
Newport News
N orfolk
Petersburg ___
Portsmouth __
Richmond ____
Roanoke _____
Stau nton _____

243,453
327,015
173,853
1,329,054
354,500
191,955
1,176,795
1,159,256
98,110

1,677,614
127,725
178,858
1,683,144
113,875
280,135
1,736,929
709,017
83,010

1,766,029
1,180,916
741,487
7,311,560
706,900
962,165
5,298,368
3,780,756
476,435

2,459,634
712,251
4,918,448
5,784,174
622,799
4,892,907
6,413,890
3,565,802
523,835

652,774
133,307
472,500

651,459
102,585
497,278

2,635,218
1,171,893
1,680,574

2,058,666
317,705
1,367,965

North Carolina
A sh eville_____
481,239
Charlotte_____ 2,912,957
Durham --------395,662
Greensboro ___ 1,085,653
H igh Point
499,675
Raleigh ............ 11,332,625
Rocky Mount _
320,982
Salisbury ____
117,290
W inston-Salem
1,013,160

238,548
1,916,393
432,647
518,229
284,610
883.086
420,648
730,960
886,229

1,026,453
12,102,510
2,475,432
4,445,983
1,793,483
14,350,670
2,129,757
567,371
2,842,132

1,236,886
8,719,087
3,343,671
2,474,633
990,665
6,516,633
1,300,180
923,037
3,592,431

South Carolina
C h arlesto n ___
Columbia ____
Greenville ____
Spartanburg _

ii

111

W H O LESALE TRADE

—

Maryland
Baltimore -------$ 8,737,535
Cumberland __
57,075
Frederick ____
133,840
Hagerstown __
107,000
Salisbury_____
193,802

April
1952

W est Virginia
Charleston ___
Clarksburg ___
Huntington __

122

L IN E S
Auto supplies ( 8 ) ___
Electrical goods (4 )
Hardware ( 1 3 ) ______
Industrial supplies (9 )
Drugs and sundries (12)
Dry goods (14)
Groceries (48)
Paper and products (5 )
Tobacco products (10)
Miscellaneous (93) ____
District Totals (216)

data

109,269
459,335
2,344,833
183,345

1,847,979
2,237,517
2,243,200
326,143

476,035
2,365.316
4,053,160
610,769

1,013,867
771,090
777,250
82,455

D ist. of Columbia
W ashington __ 4,862,967

5,531,434

20,213,119

16,767,912

District Totals „..$41,208,696

$27,069,430

$123,527,296

$107,722,128

D E P A R T M E N T ST O R E O P E R A T IO N S
(Figures show percentage changes)
Metropolitan Areas
Rich. Balt. W ash.
Sales, A p r. ’53 vs A pr. *5 2 ___

— 4.0

— 7.6

Other D ist.
Cities Totals

— 1.4

— 0.5

— 1.8

Sales, 4 Mos. ending A pr. 30, *53
vs 4 M os. ending A p r. *52 + 1.4
Stocks, A pr. 30, *53 vs *52 _ + 1 4 .5

+

1.0

+

0.2

+

4.9

+

2.9

+

7.8

+

9.1

+

9.9

+

9.5

Outstanding Orders
A pr. 30, *53 vs *52 ______

5.7

+ 1 6 .7

+

0.6

+

8.7

+

4.9

Open account receivables A p r . 1
collected in A p r. *53 ------31.7

48.1

44.0

38.3

41.7

14.0
W .V a .

15.4

13.6

D .C .

13.5
V a.

N .C .

S.C .

— 1.4

—2.2

—2.6

+ 3 .1

+ 6 .4

Instalm ent receivables A p r. 1
collected in A pr. *53 ____
Md.
Sales, A pr. *53 vs A p r.
* 5 2 ____________________ —7.7




-

11.8

•I n

R E T A IL F U R N IT U R E SA L E S
Percentage comparison o f sales in
periods named with sales in same
periods in 1952
ST A TE S
A pril 1953
4 M os. 1953
Maryland ( 6 ) ------------------------------- + 2 5
+10
D ist. o f Col. ( 7 ) _________________ — 6
—10
Virginia ( 1 7 ) ____________________
4 -2
+ 2
W est Virginia ( 1 0 ) ______________+ 3
+ 3
North Carolina ( 1 4 ) ____________ + 2
+ 3
South Carolina ( 6 ) ----------------------+ 3
+ 6
D istrict ( 6 0 ) ___________________ + 3
— 1
IN D IV ID U A L CITIES
Baltimore, M d. ( 6 ) _______________+ 2 5
Washington, D . C. (7 ) ___________
— 6
Richmond, V a . (6 ) ________________
+ 4
Charleston, W . V a. ( 3 ) __________
— 13
Number o f reporting firm s in parentheses.

y

+10
— 10
0
+20




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