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he contribution that a well-balanced international trade
can make toward full production and employment
throughout the nation is receiving growing recognition in the
Sixth Federal Reserve District, one of the sections that would
be most strongly affected. In addition, because of the Dis
trict’s proxim ity to Latin America, attention is being focused
upon the role that an expanded trade with that area may play
in the South’s economic future.
The im portance of foreign trade as a source of employment
and income is readily apparent where ships dock and unload
cargo brought from foreign countries and reload with Am eri
can goods, as they do at such District ports as Mobile, New
Orleans, Savannah, Jacksonville, Tampa, and M iam i; where
the arrival of planes bringing passengers from all parts of
Latin America is a regular occurrence, as it is at such Sixth
District cities as Miami, New Orleans, and T am pa; and where
ship-repair facilities are kept in operation by the needs of
vessels engaged in foreign trade. Furtherm ore a lively inter
est in the possibilities of foreign trade is demonstrated in
inland sections of the District as well. In the A tlanta area,
for example, a survey conducted by the Foreign Trade Coun
cil of the chamber of commerce reveals that approxim ately
150 firms have expressed a desire to expand their markets
through foreign trade. The current industrial expansion in
the South, it is hoped, will be paralleled by a growth in trade
with Latin America.
The recent announcement that the newly organized Inter
national Trade M art will begin operation at New Orleans
on June 7, 1947, is therefore of outstanding interest. As it is
planned, the m art will assist m aterially in removing some of
the obstacles to a perm anent development of United States
trade with Latin America. Since, in addition to being the Dis
trict’s largest port, New Orleans serves the entire M ississippi
Valley area, a development such as that of the International
Trade M art has significance to the growth of foreign trade
not only in the District but also in the rest of the nation. The
New Orleans experiment may point the way toward overcom
ing many of the difficulties that have ham pered trade with
Latin America.
As a general rule in the past, except for its m ajor national
lirms American business has not exhibited its present de
gree of interest in foreign markets. Foreign trade is a new
venture for many firms. For an individual concern the de
In te rn a tio n a l
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Number 4
A tlanta, Georgia, A pril 30, 1946
Volume XXXI
R o le
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R eview
T ra d e
M a rt
cision to enter that field becomes a practical problem re
moved from abstract generalities into the realm of ordinary
day-to-day business transactions. These firms realize that al
though trade agreements, financial agreements, the Interna
tional M onetary Fund and Bank, and trade treaties are all im
portant matters bearing upon the future course of interna
tional trade, the immediate problem of the individual firm is
one of m astering practical details.
Like domestic sales transactions, foreign trade involves
practical details of demand creation, finding a buyer, ne
gotiating terms of sale, and transferring the title. Also in
volved are the practical details of transportation, storage,
and finance. Furtherm ore, in international transactions many
of these details become more complex. There are customs and
shipping regulations. Sometimes certain special types of
packaging are required. There are problem s of foreign ex
change and finance. Foreign-trade documents appear to be
exceedingly complex to those persons accustomed to domestic
trade only. A lack of uniform ity in laws and commercial prac
tices and numerous other problems add their complications.
Many of these factors can be overcome by utilizing the faci
lities of the foreign-trade departments of commercial banks
and the services of export-im port firms specializing in the
handling of foreign-trade transactions.
Even more fundam ental perhaps are the problems that buy
ers and sellers have in getting together and that buyers have
in determining the fitness to their needs of the goods avail
able. In order to meet them, large American corporations
have developed special foreign-trade departments. They have
representatives in the foreign markets and branch offices in
the principal cities where American goods are displayed.
Contact is made directly between buyer and seller, the sale is
arranged, and other details completed. For the sm aller firm,
however, such a course of action is im practical, both because
of the lack of experience and because of the great cost in
volved.
W ithin the United States the problem of bringing the buyer
and seller together and that of making it possible for the
buyer to determine what goods are available and which of
them are suitable to his needs have been met by the develop
ment of specialized markets. Over the course of many years
centers have grown up in certain cities where buyers may view
the merchandise of many competing firms and where they
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may complete the details involved in the transaction. R etail
ers, fo r example, regularly visit the garm ent centers, the fu rn i
ture markets, and other centers. It is unnecessary fo r them
to search the entire country to find the goods they want. T rans
actions can be completed in a m inim um of time. In addition
to the specialized type of market, certain centers have been
developed at which a variety of goods are displayed and sold.
The most notable of these is the M erchandise M art in Chicago.
The establishment of such m arkets for international trade
is not a new development, although it is new to the United
States. In Medieval Europe the beginnings of international
trade were fostered prim arily through the great international
fairs. One of the most notable was the cycle of fairs at Cham
pagne, France, which succeeded one another so rapidly as
to become almost one continuous fair. At Champagne were
assembled on the greatest possible scale all the export raw
m aterials and m aufactures of Europe and the M editerranean
region.
W ith the development of im proved means of communica
tion and m odern industrial operations the character of the
great fairs changed. Though certain im portant fairs have con
tinued, they have done so on a changed basis. The sellers’
practice of bringing a store of goods for immediate sale was
changed to one of displaying samples, on the basis of which
sales were consummated. Serving as a sort of perm anent ex
position where orders m ight be placed, the Leipzig fa ir be
came an im portant instrum ent in the expansion of Germany’s
international trade. D uring and after W orld W ar I a num ber
of fairs, which were chiefly sam ple expositions, were devel
oped in other nations. There were about 150 such fairs in
Europe p rio r to W orld W ar II. The extensive staffs both p ro
vided the technical management and conducted publicity cam
paigns throughout the world. M any of them utilized modern
advertising methods and m aintained foreign offices. A resum p
tion of many of these European fairs has recently been an
nounced.
T rade growth in the U nited States failed to lead to the
development of such fairs on the E uropean scale. Perhaps one
of the chief reasons was that early American exports were
for the most p art standardized raw m aterials. Sale by descrip
tion and sam ple was relatively easy. Then m any of the m anu
factured goods that the United States later began to export
were industrial goods or consumer durable goods of large unit
cost, such as autom obiles. The sale of these goods required
less individual contact between buyers and sellers than the
sale of other types of m erchandise needed. Furtherm ore, the
firms selling them were able to support foreign-trade depart
ments.
If hopes for a continuing growth of Latin-American trade
at the scale now contem plated are to be realized, however,
greater emphasis m ust be placed on the sale of consumer
goods and on a large num ber of sales of goods of small unit
value. Moreover, the recognition that trade is a two-way
proposition requiring increased purchases of Latin-American goods by citizens of the United States is becoming ap
parent. This type of trade will demand m ore and more per
sonal contacts and m ore and m ore of the facilities for de
term ining which goods are suitable to the needs of the buyers
of both this nation and Latin America.
The 20 Latin American republics, with a population esti
m ated at approxim ately 184 m illion, constitute a great po
tential m arket for American goods. According to the United
States D epartm ent of Commerce, the oontinent of South
America with its 92 m illion inhabitants is the fastest growing
continent in the world. Prospects fo r future growth in popu
lation are favored by the high rate of natural increase and the
further reduction in m ortality that is expected.
A large and growing population, to be sure, does not in
itself create a demand for American goods unless it has p u r
chasing power. At present the income per capita in most of
the 20 Latin-American republics is com paratively low, rang
ing from the highest of $200 a year down to $20, with an
average of $101. The greater industrialization of m any of the
countries is, therefore, encouraging, fo r it points to a pos
sible rise in the level of national income and a consequent in
crease in purchasing power fo r American goods. C ontrary to
a popular belief, industrialized countries are the best Am eri
can customers, not only for raw m aterials but fo r m anufac
tured products. W ith each of the nations specializing in the
production of those goods in which it has a com parative ad
vantage, there are num erous m anufactured products for m u
tually advantageous trade.
Increased industrialization in Latin Am erica should also
eventually assist in stabilizing its purchasing power. The in
come of Latin-American countries depends to a marked degree
upon the sale of raw m aterials abroad. W ith the exception of
Mexico and Ecuador, each country usually has a maximum
of three products that represent m ore than 60 percent of its
total exports. In each of 12 countries a single product rep re
sents m ore than 50 percent of its exports. Because of their
great dependence upon single exports, the purchasing power
of these nations reflects keenly the trend of economic condi
tions in other countries, declining sharply in periods of de
pression. A more diversified economy should, therefore, p ro
vide a more stable purchasing pow er fo r products of the
United States.
D uring W orld W ar II both the im ports and the exports of
Latin America increased, and other conditions created by the
w ar have also placed those countries as a whole in a favor
able position to purchase American goods. Exports by the
United States to the other American republics, which averaged
485 m illion dollars in the period from 1936 to 1938, averaged
862 m illion dollars for the years 1942 through 1944 and in
1945 totaled alm ost 1.3 billion dollars.
The growth of exports p rio r to the entrance of the United
States into the w ar came about p artly as a result of the cut
ting off of the custom ary European sources of supply. Even
after the United States entered the w ar and Governmental con
trols were instituted, American exports to Latin A merica con
tinued at a high level. The policy of the United States was to
allocate the Latin American republics the scarce commodi
ties necessary to m aintain their economies. Relatively large
amounts of iron and steel, textiles, coal, wood pulp and paper,
dyestuffs, and industrial chemicals, which were form erly sup
plied by European nations, were included in the exports.
There was a decline, however, in the export of consumer
durable goods, which had been of great im portance in this
country’s trade prior to the war.
The value of the United States’ im ports from Latin-American
nations, which generally exceeded that of its exports to those
countries, fell slightly under the value of exports in the years
1938 through 1940. W hen the United States entered the war,
the picture rapidly changed. The expansion of im ports from
Latin America was relatively greater than the expansion of
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exports. The United States was forced to turn to the LatinAmerican republics to secure not only increased quantities of
m aterials custom arily obtained from that area but raw m a
terials and food stuffs form erly purchased from areas that
were then cut off by wartime conditions. As a result, im ports
from the Latin-American republics, which had an average
value of 542 m illion dollars in the period 1936-38, averaged
1.3 billion dollars during the period 1942-44 and amounted to
1.6 billion dollars in 1945. In the five-year period 1941-45
merchandise im ports of the Latin-American republics exceeded
their m erchandise exports by a total of 1.8 billion dollars.
Because of wartime controls in the United States on the
m anufacture and exportation of goods that the Latin-Ameri
can nations have custom arily purchased from this country, the
im portation by them of such commodities as automobiles,
agricultural machinery, and household appliances declined
markedly. On the other hand, trade in certain commodities
that had been only negligible before the war increased great
ly. As a result of their increased exports and inability to p u r
chase many goods, the Latin-American countries had accu
m ulated by the end of 1944 3.3 billion dollars in gold and
foreign-exchange reserves. At present these countries consti
tute one of the few areas of the world that have the means to
pay for im ports with American dollars.
There is now because of the war a large backlog of demand
for the goods of this country. The Co-ordinator of InterAmerican Affairs in 1944 estimated that the 10-year-postwar
industrial needs alone of the 20 Latin-American republics
would amount to 9.8 billion dollars, and the United States
D epartm ent of Commerce estimates an average annual re
quirement of 800 m illion dollars for im ports with which to
replace worn-out capital goods and carry on new capital de
velopments during the next four years. There are, in addition,
accumulated demands for many types of United States con
sumer goods.
Those persons fam iliar with Latin-American trade recognize
that, although the prospects of such trade appear very bright,
certain difficulties must be surmounted if it is to be m ain
tained on a continuing basis. There is, of course, the danger
that rising prices of United States goods may drive the LatinAmerican nations to purchase elsewhere as other industrial
countries get back into production. It is also possible that un
less the Latin-American nations can increase and continue
31
their exports at a high level, particularly to the United States,
they will be unable to purchase American goods. Moreover,
there is the ever-present possibility of increased competition
resulting from the neglect of Americans to cultivate those in
dividual trade relations in every-day details essential to a suc
cessful continuing foreign trade.
Such people see foreshadowed in the present situation a repe
tition of the experience following W orld W ar I, when, as in
W orld W ar II, there was an accumulated demand for Ameri
can goods, which developed from 1914 to 1918. Latin-American nations ordered so heavily from the United States im
mediately after W orld W ar I that its m anufacturers were un
able to meet the demands in full. American exports to Latin
America reached a total value of 1.6 billion dollars in 1920.
The chart on this page shows that the value of these exports
in 1920 has never been exceeded in subsequent years. As a re
sult of the depression of 1920-21 there were wholesale cancel
lations of foreign orders. American exports to Latin America
fell in 1921 to almost half the level of the preceding year. In
the reorganization of world trade after the depression, the
United States lost its new-won market in South America to
European nations.
Before 1914 the greater part of the Latin-American market
was controlled by European countries. Traders from these
countries were fam iliar with languages, local customs, and in
dividual problems, and they offered long-term credits. Ameri
can merchants demanded cash before shipment. They were,
furtherm ore, unfam iliar with the local markets. Emphasis
was placed by Americans upon the large sales, with a dis
regard for the many sm aller sales that amounted to a large
total for the European countries. In Argentina, for example,
goods from the United States made up 12 percent of Argen
tine im ports during the period 1910-14. The unavailability of
European goods increased that proportion to about a quarter
of A rgentina’s total im ports in 1920. After the recovery of
world trade the proportion supplied by the Americans de
clined, to 15 percent in 1922, rising to only 17 percent in
1923.
A group of New Orleans businessmen thoroughly conver
sant with these problems are determined to prevent, as far as
possible, a repetition of those conditions that came about after
W orld W ar I, when exports through New Orleans fell from a
value of 712 m illion dollars in 1920 to a value of 301 m illion
M I L L I O N S OF D O L L A R S
19 12
19 16
U.S DEPT. QF CQMMFRCE
19 2 0
19 2 4
19 2 8
19 3 2
19 3 6
19 4 0
19 4 4
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in 1923. They are resolved that trade with Latin America shall
rest on a foundation firmer than one erected upon tem porary
war-induced demands.
One step they have taken along the way to accomplishing
this goal is the establishm ent in New Orleans of Interna
tional House, which was described in the May 1945 issue of
the Review. This institution has as its purpose the develop
ment of personal relationships between buyers and sellers in
the two Americas. The success of International House in assist
ing to promote im port and export business between firms in
the M ississippi Valley and those in Latin America seems a l
ready assured.
It was recognized that international trade does not rest upon
personal contact alone. It rests also upon the buyers’ determ i
nation of the suitability of goods and upon a m ultitude of in
dividual sales transactions. At New Orleans, because of its
strategic location, both the men and the goods might be
brought together to the advantage of both buyer and seller.
In order to determine what goods are available and whether
or not they are suitable for his local markets, a prospective
buyer from Latin America at the present tim e is forced to visit
many areas throughout the United States. Not only does a
search for goods take a great deal of his time but in many
cases it necessitates his dealing with persons unfam iliar with
foreign trade. There is no one place where he may go to find
displayed the goods of several competing m anufacturers.
Furtherm ore, there is no one place where the buyers of the
United States m ight view m erchandise of the Latin-American
countries and complete sales transactions without making ex
tended trips outside the country.
The same group of New O rleans businessmen that sponsor
ed International House have therefore organized this new type
of institution resem bling in some respects the great European
trade fairs. They believe that the International Trade M art, a
nonprofit corporation chartered under the laws of Louisiana,
will assist in avoiding the mistakes of the past.
All 38 directors of the organization are executives of ship
ping companies, im port-export concerns, publishing com
panies, cotton firms, public organizations, and other interests.
The president of the organization, Theodore Brent, is also
president of Louisiana Shipyards, Incorporated. One of New
O rleans’ largest departm ent stores, the Maison-Blanche, is
represented by H erbert J. Schwartz, who is first vice president
of the Trade M art. R. S. Hecht, chairm an of the Board of the
M ississippi Shipping Company, Incorporated, is chairm an of
the executive committee. The vice presidents of the organiza
tion are W. Z. Zetzmann, R. K. Longino, C. Earl Colmb, and
Kenneth C. Barranger. Each of the directors has backed up
his belief in the enterprise by contributing a minimum of
$1,000. In many cases the contributions have been larger.
To facilitate the securing of quarters for the new trade m art
the original organizers created the M art Realty Corporation.
The sole purpose of this agency, which was financed by the
directors of the International Trade M art, was to purchase a
building for transfer to the International Trade M art. For the
sum of $200,000 this corporation has bought a five-story
building with frontages of three quarters of a block on Cominon Street and a half block on Camp Street. Located near
New O rleans’ financial and trading center, the building is only
a block from International House. It will be sold to the In te r
national Trade M art by the M art Realty Corporation at no
profit. Between $600,000 and $700,000 will be spent to reno
vate it.
Bonds sufficient to finance the acquisition and renovation of
the property will be floated in the near future. These bonds
will bear a low rate of interest, and they probably will be
amortized over a period of 10 years. No difficulty in securing
the necessary funds is expected. It is anticipated tliat rentals
from exhibits will be sufficient to amortize the bonds and to
carry on the necessary activities of the organization.
According to the present schedule, work on the building
will begin in August or September of this year. Plans have
been developed to transform the present structure into one of
the most modern of its kind. The white-stone facing of the
renovated building will be relieved by vertical panels of glass
brick, and an imposing corner entrance is planned. There will
be no outside windows.
The interior, which will be air conditioned throughout, will
be so constructed as to minimize dust and noise. Individual
sales rooms and display rooms with plate-glass show windows
fram ed in alum inum or alloy m aterials will line the corridors.
The lighting will be of the m odern indirect type.
Display spaces will range in size from 192 square feet to
1.000 square feet, although in some cases it may be possible
for merchants to secure additional space. W ith a total of
80.000 square feet of display space available the building can
accommodate about 160 different lines, if an average of 500
square feet is allocated each tenant. Exhibitors are being en
couraged to improve and decorate their individual spaces.
Toward the cost of such improvements the International T rade
M art will pay up to 50 percent of a specified amount.
The first floor of the building will be devoted to the display
of heavy machinery, autom obile parts, and other types of
heavy, bulky merchandise. On the second floor will be the
headquarters of a num ber of im port-export firms. These com
panies will be specialists in foreign trade, often representing
from 15 to 20 firms. They handle for their clients the technical
details involved in im porting and exporting. To those firms
new to foreign trade and to those that do not m aintain foreigntrade departm ents the central grouping of these companies
will be especially helpful.
The rem aining floors of the building will be devoted to the
display of various types of merchandise, representing a crosssection of the m anufacturing firms in the M ississippi Valley.
A buyer from Latin America will find displayed, in addition
to machinery, automobiles, and trucks, many varieties of con
sumer goods made in the United States. Moreover, a United
States buyer will be able to inspect a variety of Latin-American merchandise.
These buyers will find on exhibit cotton and woolen tex
tiles, all types of apparel, and gifts and novelties. The latter
classes of goods should be especially attractive to buyers in
this country. There will be space for the display of retailstore equipment, household appliances, and electrical goods.
Cosmetics as well as drugs and pharm aceuticals w ill'be found
in another section. The buyer can inspect all types of fu rn i
ture produced in the M ississippi Valley and those types of
furniture in which the Latin-American countries specialize.
Processors of packaged foods also will display their wares.
Several of those commodities that were exported before the
war to Latin-American republics in negligible quantities but
increased during the war made extraordinary advances.
Among them were paints and building m aterials such as ce
ment and clay products. Even before the w ar the exports of
lum ber and wood m anufactures to Latin-American countries
amounted to 3 percent of the total exports. D isplay space for
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building m aterials, paints, and allied products, therefore, is
im portant.
Scientific and professional instrum ents and supplies made
up one of the leading classes of commodities exported to Latin
America before the war. D uring the war period the increase
in this type of export was outstanding. From 1938 through
1944, the value of this type of export increased 404 percent.
The allocation of space for displays of medical equipment
and other scientific apparatus will, therefore, help to keep
this type of trade at a high level. D isplay space is also to be
assigned to m anufacturers of business machinery, in the production of which United States m anufacturers have made note
worthy advances.
Rather than lim iting the firms to a small num ber of large
m anufacturers, the directors of the International Trade M art
are seeking to obtain a wide representation of m anufacturing
firms in the M ississippi Valley and in Latin America. A num
ber of leases have already been signed. Since the Trade M art
is to represent the entire area, the number of New Orleans
firms will be kept down and the extent of display space that
any one firm may lease also will be limited.
Every effort is being made to enable the comparatively
small m anufacturing firm that has heretofore confined its
business to the United States to enter the foreign field. The
rental rates perm it even small firms to m aintain headquarters
in the Trade M art. Rates run from $4 to $5.65 a square foot
annually. Rental for the smallest space available would
amount to $976 a year. A typical unit of 1,000 square feet will
rent for approxim ately $370 a month. Leases are signed for
a three-year period. The headquarters of some of the smaller
firms in the International Trade Mart, it is expected, will be
used for district offices also.
The m art is not to be merely a place where goods are ex
hibited but also a place where goods are actually bought and
sold— where all arrangements of sale are completed and de
liveries arranged. Each tenant will be required to maintain
a sales office as well as to display his merchandise.
It is contemplated that a hardw are distributor from Bo
gota, for example, would thus be able to complete his busi
ness within the space of approxim ately a week. Under exist
ing schedules, he could arrive in New Orleans one and a half
days after boarding a plane at Bogota. Upon his arrival, in
stead of leaving for other points over the United States to dis
cover what merchandise was available and whether it was suit
able for his needs, he would go to the International Trade M art
to view goods displayed there by American hardw are m anu
facturers. In a few days’ time he could make his purchases,
arrange for financing and shipment, and return to Bogota.
Prospective buyers from other parts of Latin America also
can complete their business in a minimum of time. Under the
present air schedules, Lima is two days away
from New Orleans, Rio de Janeiro three days,
and Buenos Aires three and a half. A buyer
from Guatemala can arrive in New Orleans
within six hours. Even better air schedules,
it is expected, will go into effect soon.
The facilities will be equally advantageous
for the buyers of this country. A buyer
from a large department store in New York,
for example, wishing to enlarge his stock
of Mexican novelties could travel to New
Orleans, view the merchandise, complete the
33
sales transaction, and return to New York in a period of two
or three days. In contrast, even by air a trip to the various
centers in Mexico where such goods are available would re
quire a considerable period of time.
New Orleans’ location, the directors of the International
Trade M art believe, is also particularly advantageous for the
shipping of merchandise. It has been claimed that exports to
the east coast of South America can be shipped from 23 states
or parts of states in the central United States more advan
tageously through New Orleans and other Gulf ports than they
can be shipped through the northeastern Atlantic ports. New
Orleans is served by a number of steamship lines, and the
completion of new ships they are now having built will pro
vide frequent and fast freight service.
The staff of the International Trade M art is designed to
carry out most effectively its chief purpose of developing in
ternational trade. The present staff, under the direction of
Clay L. Shaw, sales manager, is housed in the International
Building, in which is also located International House. Event
ually the organization will include a general manager, ad
m inistrative director, a building manager or director of opera
tions, and a director of public relations.
It is contemplated that the public relations activities will
be very extensive. Plans call for perm anent maintenance of
representatives of the m art at the more im portant Latin-Ameri
can trade centers. The director of public relations will have
charge of an extensive advertising program both in the United
States and the Latin-American periodicals. A documentary
film will describe the activities of the m art and the m anu
facturing facilities of the Mississippi Valley area. The dis
play of a new type of product might call for an extensive ad
vertising campaign. Since the m art will be a nonprofit or
ganization, all money above the necessary operating expenses
will be available for prom otional work.
An integral part of the m art will be the activities of the
International Foreign Service Bureau. This agency will not
compete with the services now provided for foreign trade and
financial institutions. Rather it will act as a clearing house
from which a person may learn where to find the services he
requires. The services may include translation assistance and
the provision of inform ation on such m atters as forwarding
services, documentation, packaging regulations, and credit. In
addition, it is expected that the bureau will carry on market
research. This service should be extremely valuable to the
firms that do not maintain foreign-trade departments.
The economic future of the South, it is stated, is linked
with its success in developing a diversified industry. In a few
years, when the accumulated domestic demand for this coun
try’s m anufactured products has been satisfied, the size of the
nation’s export trade may mean the difference between
profits and losses to many industries, includ
ing those in the Sixth District. In a few
years, also, other nations whose economic
livelihood is dependent to an even greater
extent upon the size of their exports will be
much more able to compete with American
producers than they now are. From the de
velopment of such institutions as the Inter
national Trade M art the United States will
receive im portant aid in its struggle to re
tain its foreign markets and expand them.
C harles T. T aylor
34
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O w n e rs h ip
in the Sixth D istrict have been watching carefully
the trends of their deposits since V-J day. Some of them
have believed that postw ar conditions might alter the trend
toward the greater-than-national increase in deposits expe
rienced during the w ar and, especially, that they m ight cause
im portant shifts in ownership of the deposits. From July
1945 through January 1946, according to the sem iannual sur
vey of the ownership of bank deposits, total demand deposits
of individuals, partnerships, and corporations in all Sixth Dis
trict banks increased, however, at a rate greater than that ex
perienced by banks throughout the nation. Furtherm ore, in
creases were greater in alm ost all types of ownership, and
though deposits of m anufacturing and m ining concerns de
clined 7.0 percent in the D istrict banks, they declined 13 per
cent in banks of all the D istricts. W hether or not this trend
will continue depends upon both D istrict and national con
ditions that cannot be forecast with precision.
Total demand deposits of individuals, partnerships, and
corporations in all Sixth D istrict banks were estimated at
4,138 m illion dollars on January 31, 1946, or 13 percent
greater than they were estimated to be six months earlier and
22 percent higher than the level of the same date in 1945. In
creases m ore than sufficient to offset the decrease in m anu
facturing and m ining accounts were experienced in all other
types of accounts. The greatest dollar increases took place in
retail- and wholesale-trade accounts and in personal ac
counts. D etails showing the amounts of the estimates together
with the changes during the six-month period are shown in
table 1.
These estimates are based on reports received from 97 mem
ber banks, located throughout the District, that co-operated
in the survey by classifying and reporting the deposit ac
counts of individuals, partnerships, and corporations by type
of ownership. In this discussion these accounts are referred to
as demand deposits.
B
a n k e rs
TABLE 1
ESTIMATED OWNERSHIP OF DEMAND DEPOSITS OF INDIVIDUALS,
PARTNERSHIPS, AND CORPORATIONS IN ALL COMMERCIAL
BANES IN SIXTH FEDERAL RESERVE DISTRICT
(In Millions oi Dollars)
Percent Percent
Jan.
Change Change
Distribu
Type oi Ownership
1946
July 1945- July
1945- tion
Jan. 1946 Jan. 1
946 Jan. 1946
Manufacturing and mining_
— 34
429
10.4
— 7
Public utilities, transporta
tion, and communications...
245
+ 2
5.9
+ 1
Retail and wholesale trade_
878
+ 145
21.2
+ 20
246
+ 42
All other nonfinancial*........
5.9
+ 21
Total nonfinancial........
1,798
+, 155
43.5
+ 9
Insurance companies.........
74
+ 24
1.8
+ 14
Trust funds of banks..........
4.1
1.0
+ 3
+ 7
All other financial**..........
+ 48
199
4.8
+ 32
Total financial............
314
+ 65
7.6
+ 21
Total business...............
+ 220 . + 10
2,112
51.1
Nonprofit organizations......
+ 28
106
+ 36
2.6
Personal, including farmers... 1,918
+ 233
+ 14
46.3
Foreign.......................
2
+ il
+ 42
Total individual, partner
ship, and corporation......
4,138
+ 482
100.0
+ 13
including construction contractors and theaters and hotels, laundries
garages, repair shops, and other service establishments.
**Including investment and loan and insurance agencies, real-estate busi
nesses, etc.
o f D e m a n d
D e p o s its
The decrease in the deposits of m anufacturing and mining
concerns in the postwar period has been p artly the result of
a cancellation of war contracts. Many corporations that were
specifically organized for war production or were greatly ex
panded during the war period for the specific purpose of
m anufacturing war m aterials have alm ost completely ceased
operations. The decline of approxim ately 15 percent in m anu
facturing employment in the Sixth D istrict states during the
period of the survey is an indication of the relative decline
in m anufacturing activity.
Previous surveys have indicated, however, that the accounts
of these war-born or war-stim ulated corporations made up a
sm aller proportion of the total growth in deposits than might
have been expected. In m any cases, while a substantial work
ing balance was kept in Sixth D istrict banks a considerable
portion of the deposits of these corporations was m aintained
in the banks of other Districts. Large corporations also in
vested a large part of their cash surplus during the w ar in
Government bonds. The ending of the war, therefore, did not
create as large a shrinkage in m anufacturing deposits as it
would have done otherwise.
Perhaps of greater im portance in explaining the decline in
m anufacturing and m ining deposits are the expenses neces
sary for reconversion follow ing V-J Day. D uring this period
m anufacturing concerns converting from w ar production have
made expenditures fo r plant conversion, m aterials, and equip
ment prio r to the production and eventual sale of their peace
time m anufactured products. In addition, part of the decrease
may be caused by the accum ulation of inventories.
That the cancellation of war contracts did not have the ef
fect of causing a decline in Sixth D istrict demand deposits is
also indicated by the experience of banks located in the D is
trict’s shipbuilding centers. Total demand deposits of eight
large banks located in Mobile, Jacksonville, Tam pa, and New
Orleans registered a slight increase of 2 percent in the six
TABLE 2
PERCENT CHANGES IN OWNERSHIP OF DEMAND DEPOSITS OF INDI
VIDUALS, PARTNERSHIPS, AND CORPORATIONS, SELECTED SIXTH
DISTRICT BANKS, JANUARY 1946 FROM JULY 1945
AND JULY 1943
Eight Large
Banks in
20
Shipbuilding
Large Banks
Centers*
July
July
July
July
1943
1945
1945
1943
Classified Accounts**
— 3
- 16
Manu. and mining......... — 16
+ 1
Pub. util., trans., and
+ 63
— 5
+ 27
commun................. + 8
+ 48
+ ;15
+ 63
Ret. and whole, trade.... + 10
— 4
— 13
+ 6
All other nonfinan......... + 8
+ 26
+ 36
+ 35
All other financial......... — 30
+ 44
— 5
+ 22
Insurance companies..... + 10
+ 44
29
4* 6
Trust funds—banks....... — 9
+ 176
-j- 25
+, 117
Nonprofit assoc............ + 75
(
(
Personal
+0109
+ ( 92
.+( 14
Farmers................. +( 10
(
(
(
+ 3,1
+
3
6
+
3
5
Total class, accts.......... +
+ 59
+ 38
“f* >lil
Total nonclass, accts...... — 5
Total demand deposits,
+ 40
+ 37
+ 6
ind., part, and corpn.... + 2
*Changes between 1943 and 1946 in six banks.
**In the large banks accounts above $10,000 are classified. In the small banks
accounts above $3,000 are classified.
M o n t h ly
R e v ie w
o f th e F ederal R eserve B a n k o f A tla n ta fo r A p r il 1946
months ended January 31, 1946. This increase was slightly
less than that experienced in 20 sim ilar banks located through
out the District. The decrease that occurred in those m anu
facturing and m ining accounts of more than $10,000, how
ever, was at the rate it was in the larger banks generally.
There was also a slight decrease in the accounts of insurance
companies in the shipbuilding-center banks, but this type of
account constitutes no more than an approxim ate 2 percent
of the total demand deposits. Personal accounts increased
slightly less in these banks than in other large banks of the
District.
Even during the war the deposit-ownership pattern in these
banks did not differ m aterially from that in banks of a simi
lar size group in other cities throughout the D istrict. Not only
does it appear that the decline in shipbuilding and the can
cellation of some contracts failed to have the effect upon the
ownership pattern of deposits in these banks which might or
dinarily have been expected, but it appears that other types of
economic activity have rem ained at a higher level than might
have been expected. In many of the cities a certain am ount of
shipbuilding is continuing, and a considerable activity in shiprepair, a norm al peacetime industry, is underway. F urther
more, the relatively large proportion of personal deposits in
these banks has been im portant to the maintenance of total de
posits. Expansion in other types of industry has also offset
the decline in shipbuilding. Changes in deposits in these
banks, however, differ somewhat from those in banks in other
cities, as indicated in table 2.
Personal deposits have always been of greater im portance
in the Sixth D istrict than the deposits of m anufacturing and
mining enterprises. The end of the war saw no slowing down
in the growth of personal deposits, which have continually
expanded since the survey was inaugurated in 1943. These
deposits, including farm ers’ deposits, were estimated to make
up 38 percent of the total in all banks of the Sixth D istrict in
July 1943. They had more than doubled by January 1946,
when they constituted 46 percent of total demand deposits.
They expanded 233 m illion dollars, it is estimated, in the six
months preceding the date of the survey.
In the light of declining m anufacturing employment and
increased retail sales in the D istrict, the expansion of personal-deposit holdings m ight at first appear to be contrary to
expectations. The growth in m anufacturing employment dur
ing the war period was a very im portant factor in expanding
total employment, but it constituted only about one third of
total nonagricultural employment in the Sixth D istrict states.
The decline experienced in m anufacturing employment, there
fore, did not have as im portant an effect in inducing indivi
duals to draw upon their reserves accumulated during the war
as it would have had if m anufacturing employment had con
stituted a more im portant portion of total employment. By
the end of 1945 nonagricultural employment other than m anu
facturing had actually increased over the level of the pre
ceding year. W hile m anufacturing employment declined
311,000 during 1945 an increase of 14,000 in the num ber of
workers in other types of industry kept the total decline down
to 297,000. Furtherm ore, the D istrict’s income, which is de
pendent to a very great extent upon its agricultural income,
was aided by an increased cash farm income that was 4 per
cent above the 1944 figure and higher than the farm income
for any previous year.
35
POST WA R LO A N S
of Sixth District W eekly Reporting Member Banks
(MILLIONS OF DOLLARS)
560
560
u1
\
TO TAL LOANS
S20
520
480
480
440
44 0
1Q d fi
1Q
9 «f D
400
... 1
400
360
360
320
- - L^ 1
*JAN
I I
APR
1
1 1
1
320
I
D EC
AUG
APR
Loans of Sixth District weekly reporting member banks after remaining at
com paratively stable levels during the war years advanced rapidly during
the latter part of 1945. Although declining since the first of the year, total
loans on A p ril 17 were 55 percent above the previous year's level.
I 80
160
I 40
140
i oo
100
An expansion of loans to purchase securities caused partly by Treasury
financing and the victory loan drive accounted for most of both the increase
in total loans and the decline since the first of the year.
260
260
220
220
I 80
I 80
DEC
Co m m ercial, ag ricu ltural, and industrial loans, although declining slightly
since the first of the year because of seasonal influences, were 27 percent
higher on A p ril 17 than on the corresponding date in 1945.
145
I 10
145
I
BEAL ESTATE LOANS,
LOANS TO BANKS,
AND ALL OTHER LOANS
^
!1
/■
i
i 10
_ 1
1945
70
JAN
1946
--- L--- ...1 ...1 .. I
APR
I
AUG
l
I
DEC
70
APR
Part of the increase in other types of loans is the result of an expansion of
consumer borrowing. Real estate loans on A p ril 17 were at p ractically the
same level as in 1945.
M o n t h ly
36
R e v ie w
o f th e F ederal R eserve B a n k o f A tla n ta fo r A p r il 1946
S ix th D is tr ic t S t a ti s ti c s
B a n k
CONDITION OF 20 MEMBER BANKS IN SELECTED CITIES
(In Thousands of Dollars)
Percent Change
April 17 Mar. 20 April 18 April 17, 1946, from
Item
1945 Mar. 20 Apr. 18
1946
1946
1946
1945
Loans and investments—
2 4- 24
Total..................... 2,253,515 2,289,830 1,821,206 —
Loans—total.............. 498,079 503,032 322,,185 — 1 -J-* 55
Commercial, industrial,
and agricultural loans 237,973 242,697 186,657 — 2 + 27
Loans to brokers and
dealers in securities.. 11,023 10,179 7,759 + 8 4* 42
Other loans for pur
chasing and carrying
securities............ 125,572 128,372 36,308 — 2 +l246
Real estate loans......
27,129 21,612 25,917 + 26 + 5
1,408
Loans to banks.........
1,339 1,623 4- 5 — 13
Other loans............ 94,974 98,833 63,9211 — 4 4- 49
Investments—total...... 1,755,436 1,786,798 1,499,021 — 2 4- 17
U. S. direct obligations. 1,602,976 1,634,579 1,362,916 — 2 + 18
Obligations guaranteed
by U. S...............
1,672
1,461 6,192 4- 14 — 73
Other securities....... 150,788 150,758 129,913 + 0 + ,16
Reserve with F. R. Bank.... 366,108 370,794 346,596 — 1 4- 6
Cash in vault............... 29,,146 29,395 28,349 — 1 + 3
Balances with domestic
banks.................. 154,452 148,587 148,056 4- 4 4- 4
Demand deposits adjusted. 1,324,22(1 1,306,959 1,,229,632 4- 1 4- 8
Time deposits.............. 435*288 431,044 357,014 4- '1 + 22
U. S. Gov't deposits........ 386,475 413,863 146,805 — 7 +.163
Deposits of domestic banks. 540,026 564,907 505,977 — 4 4- 7
Borrowings................
3,500
Place
DEBITS TO INDIVIDUAL BiANK ACCOUNTS
(In Thousands of Dollars)
Percent Change
No. of
Mar.
Feb.
Mar. March 1946from
Banks
1946
1945
Report 1946
Feb. Mar.
ing
1946 1945
ALABAMA
,18,103 ,14,867
Anniston......
19,891
3
Birmingham. ..
227,866 188,753 212,430
6
10,143
9,569
Dothan.......
8,0,10
2
12,927
10,457
11,010
Gadsden.....
3
98,985
86,643 124,035
4
Mobile.......
Montgomery...
56,596
48,409
40,280
3
FLORIDA
212,463 186,756 191,739
Jacksonville. ..
3
231,944 205,242 159,908
Miami.........
7
Greater Miami* 1.1
336,340 297,485 219,872
46,714
4,1,125
39,562
Orlando......
2
29,152
Pensacola....
28,468
25,580
3
47,577
40,976
St. Petersburg.
3,2,394
3
98,610
85,755
89,846
Tampa........
3
GEORGIA
12,772
Albany........
11,356
10,041
,2
Atlanta.......
613,913 5,17,532 514,895
4
Augusta......
43,747
39,171
40,231
3
8,306
6,657
15,366
Brunswick....
2
42,202
38,656
36,242
Columbus....
4
Elberton......
3,093
2,6,15
2,04
2
*0
*
Gainesville*...
10,865
8,308
3
**
2
8,067
Griffin*........
7,229
Macon.........
38,153
44,010
44,193
3
Newnan......
9,186
7,183
5,75*9
2
*
17,054
14,807
Rome*.........
3
80,023
Savannah.....
65,998
87,330
4
8,803
7,410
7,097
Valdosta......
2
LOUISIANA
55,485
Baton Rouge... 3
49,850
42,926
21,086
19,976
17,547
Lake Charles. .
3
5
0
3
,6
3
2
New Orleans..
431,504 446,086
7
MISSISSIPPI
15,052
13,500
13,136
Hattiesburg....
2
88,019
75,881
70,873
Jackson.......
4
24,717
19,578
Meridian.....
18,472
3
25,168
21,973
18,807
Vicksburg....
2
TENNESSEE
,104,404
84,581
91,274
Chattanooga... 4
104,184
98,225 135,291
Knoxville.....
4
2
0
9
,8
7
9
1
8
5
,6
9
8
1
77,771
Nashville.....
6
SIXTH DISTRICT.
3,il08,370 2,683,091 2,749,969
32 Cities...... 108
UNITED STATES.
87,578,000 73,970,000 81,077,000
334 Cities.....
**Not available
*Not included in Sixth District total
+ 22
+ 21
— 6
4- 24
+ 14
+ 17
— 9
4- 7
4- 19
4- 17
— 20
4- 41
+ 14
,+ 13
4- 13
+ 14
4- 2
4- 16
4- 15
4- 11
4- 45
4- 53
4- 18
4- 14
4- 47
4- 10
+ 12
+ 19
4- 12
4- 25
4* 9
+ 18
4- 31
4- 12
4- 16
4- 28
4- 15
4- 21
+ 19
4- 27
4- 19
4- 9
46
4- 16
4- 52
H. N e e l y , chairm an of the board of the Federal
Reserve Bank of A tlanta, announced on A pril 18 that the
member banks in Group 3 had elected Donald Comer a class
B director of the Bank. Mr. Comer is chairm an of the board
of Avondale M ills, Birmingham, A labam a. He will fill the
vacancy on the Bank board caused by the death of Fitzgerald
H all of Nashville, Tennessee, on February 7.
Four new banks were added to the Federal Reserve P ar
List during the month of A pril. One of them is the East
Lauderdale Banking Company of Rogersville, Alabama, which
began rem itting at p ar on A pril 1. At the close of business
on December 31, 1945, capital accounts of the bank amounted
to $44,591 and its deposits to $719,000. W. R. Rousseau is
president, T. 0 . Rose vice president, H ollis Ezell cashier, and
Elizabeth H urn assistant cashier. The loans of this bank,
which is located in a good farm ing section of Alabam a, are
mostly crop and real estate loans.
On the same day the Farm ers Bank, Anderson, A labama,
also began rem itting at par. In its June 1945 statement this
bank showed capital of $20,000, surplus of $10,000, undi
vided profits of $7,000, and deposits am ounting to $628,000.
Its officers are W. R. Howard, president; L. E. Bayles, vice
president; J. W. H am ilton, cashier; and Inez Denham, assis
tant cashier.
The American Bank and T rust Company, a newly organized
nonmember bank in Baton Rouge, Louisiana, went on the P ar
List on A pril 2. Capital accounts of this bank amounted to
$300,000, of which $200,000 is common stock. The officers
are W. L. Caldwell, president; Rex D. Cannon, vice presi
dent and cashier; and R. K. Caldwell, assistant cashier.
On A pril 3 the Citizens Bank, Gainesville, Georgia, began
rem itting at par for checks drawn on it. According to its June
1945 statement this bank had at that time capital amounting
to $50,000, surplus $50,000, undivided profits $58,000, and
deposits $3,654,000. J. H. Hosch is chairm an of the board
and president. H. C. Hosch, J. M. Hulsey, and R. A. Brice
are the vice presidents. Mr. Brice also serves as cashier, and
Mrs. C. L. G oforth and S. H. Ledbetter are assistant cash
iers.
F
ra n k
R e c o n n a is s a n c e
Sixth District Statistics for March 1946compared with March 1945
PERCENT INCREASE ^ PERCENT DECREASE
4- 0
4- 60
—"8
4- 24
Departm ent | | | | Sales
Departm ent l i l i l i l s
4- 11 4- 29
4- 6 + 20
+ 17 4- 13
4- 11
4- 16
.4- 27
4- 15
Gasoline Taxj||[j(|{|{||||i{|^{(|j^(|njil|[|||l|ll[|||j|||||l[[|||j||
Cotton C|||isum ption
Bank I f ! ! ! !
M ember
4- 15
4- 24
+ 34
4- 34
4- 23 + 14
4" 6 — 23
4- 13 4- 18
M ember
Demand D e p o * |||d j u s te d
4- 16 4- 13
+ 18 4- 8
A n n o u n c e m e n ts
40
30
20
10
0
10
20
30
40
M
o n t h l y
R e v ie w
o f th e F e d e ra l R e s e rv e B a n k o f A tla n ta f o r A p r i l 1946
D is tric t
B u s in s s s
figures for March and April reported this year by
Sixth District department stores are larger than they have
been in any previous year. During March wholesale distribu
tion continued well above the volume for that month a year
ago. Life insurance sales have also reached new high levels.
More coal was mined in Alabama and Tennessee during
March than during any other month in recent years. Union
mines were closed by the nationwide strike on March 30, how
ever, and steel-mill activity has declined ever since. In recent
weeks the lumber mills have slightly increased their produc
tion despite continuing labor and equipment shortages.
ales
S
Department Store Trade
In the first two weeks of April the sales reported by more than
thirty Sixth District department stores averaged 65 percent
greater in dollar volume than such sales averaged in the same
weeks of last year. This large increase is in sharp contrast
to the gain of 15 percent shown by sales for the first three
months of this year compared with those for the first quarter
of 1945. One reason for the increase was the later date of
Easter this year. Since Easter fell on April 1 in 1945, Easter
buying took place in the month of March. This year, with
Easter falling on April 2 1, Easter purchases presumably were
made entirely in April. Another factor strongly affecting the
comparison is that last year March was fairly definitely the
first full month of spring, whereas the weather in April was
cooler than usual and was also rainy. As a result of the com
bined effects of the earlier date of Easter and of the weather
conditions, the daily average rate of department store sales de
clined in April 20 percent from the March rate, and, even
after allowance was made for seasonal influences and the
earlier date of Easter, the adjusted index showed a decline
of 15 percent. If the large increase in the first half of April
this year over the rate in that period a year ago holds good
for the entire month, which is hardly probable, it will mean
a rise of about 20 percent from March to April in the daily
average rate of sales. It will also mean an advance of about
6 percent in the index after allowance for seasonal factors
and the changing date of Easter.
Sales made by more than ninety department stores of the
District increased in actual dollar volume during March by
16 percent over the stores’ February sales. Because there were
more business days in the later month, however, the index of
daily average sales rose only 8 percent, and after seasonal
adjustment it actually declined almost 2 percent. In compari
son with the index for March 1945, however, the unadjusted
index for March this year was up 1 1 percent and the seasonal
ly adjusted index was up 22 percent.
Increases for the first quarter larger than the District aver
age of 15 percent were reported from several points. Or
lando with the greatest gain, 26 percent, over the volume for
the first quarter of last year was followed closely by Nash
ville with a gain of 25 percent. In addition, there were in
creases of 23 percent at Baton Rouge, 22 percent at Atlanta,
2 1 percent at Tampa and at Augusta, 20 percent at Miami,
and 18 percent at Chattanooga. Only at Knoxville and Colum
bus were first quarter sales less this year than last, and at
each of these cities the decrease was only one percent.
3 7
C o n d itio n s
Inventories for March were greater than those reported a
month earlier, since merchants were adding to their stocks for
the spring season. They were also larger than they were one
year ago at most places.
Wholesale Trade
Merchandise distribution through the District’s wholesale
firms also increased somewhat in March and showed an 18
percent increase over distribution in March of last year. Of
the 15 groups of wholesale firms for which sales figures are
available, decreases in comparison with March 1945 figures
were reported only by those dealing in beer and in industrial
hardware. Increases among the other classifications ranged
up to a gain of 45 percent, in sales of automotive supplies.
Inventories for March were off slightly from those of a month
earlier but were 20 percent larger than those for March 1945.
Life Insurance Sales
First-quarter sales of life insurance in the six states that lie
wholly or partly within the Sixth District were greater than
first-quarter sales in the District last year, according to figures
compiled by the Life Insurance Agency Management Associa
tion. The increase in January over sales in the corresponding
month last year was 29 percent, the February gain was 48 per
cent, and the March rise was 43 percent. Increases during
March for the individual states ranged from 3 1 percent for
Louisiana through 33 percent for Alabama, 37 percent for
Florida, 38 percent for Mississippi, and 39 percent for Ten
nessee to 56 percent for Georgia.
Bank Deposit Changes
The increase in demand deposits of weekly reporting mem
ber banks during April was moderate. Demand deposits ad
justed were 2 percent higher on April 24 than on March 27
and 5 percent above the amount on the corresponding date in
1945. On the other hand, Government deposits declined 6 per
cent during April but were about 2.8 times the amount on the
corresponding date of 1945.
Holdings of Government securities at the reporting banks
in the District at the end of April were approximately 15 mil
lion dollars less than they were at the end of March. They
were, nevertheless, 28 percent higher than they were in the
last week of April in 1945.
Industry
Improved weather conditions and, reportedly, a steady but
slow return of labor to the mills and the woods have been
responsible for the increased lumber production. The opera
tors are still handicapped, however, by a marked shortage of
tires and truck-repair parts as well as new handling equip
ment that is needed to replace equipment greatly worn under
the record-breaking burdens of the war period. Retail dealers
are still finding it impossible to obtain lumber in anything
like the quantities they need for meeting the constantly in
creasing demand.
Output of coal in Alabama and Tennessee during March
was at a daily rate 2 1 percent above the February rate. It
was 18 percent higher than the rate for March last year. The
daily average index of coal production in the two states for
3 8
M
o n t h l y
R e v ie w
o f the F e d e ra l R e s e rv e B a n k o f A t la n ta f o r A p r i l 1946
S ix t h D i s t r i c t S t a t is t ic s
INSTALMENT CASH LOANS
Number
Percent Change
of
Lender
Feb. 1946toMarch 1946
Lenders
Reporting Volume
Outstandings
Federal credit unions..........
+ 26
39
+ 4
State credit unions.............
21
+ 33
+ 2
Industrial banking companies
1.1
+ 16
+ 7
Industrial loan companies-19
+ 5
+ JO
Small loan companies.........
50
+ 20
+ 4
Commercial banks.............
34
+ 22
+ 11
RETAIL FURNITURE STORE OPERATIONS
Number
Percent Change
of
Item
March 1946from
Stores
Reporting February 1946 March 1945
Total sales..............................
+ 23
+ 52
99
Cash sales..............................
91
+ 22
+ 77
Instalment and other credit sales..
91
+ 24
+ 48
Accounts receivable en<£of month.
98
+. 13
+ 11
98
Collections during month..........
+ 3:1
+ 11
78
Inventories, end of month..........
+ 9
+ 8
WHOLESALE SALES AND INVENTORIES* —MARCH 1946
SALES
INVENTORIES
No. of Percent Change No. of Percent Change
Firms March 1946from Firms March 1946from
Report Feb.
Mar. Report
Mar.
Feb.
ing
ing
1946
1945
1946
1945
Automotive supplies.
+ 27
+ 1 + 45
Shoes and other
footwear.............
— 7 + 17
3
Drugs and sundries..
7
+ 4 + 3
Dry goods.............
9
— 10 + 21
+ 12
Fresh fruits and
5
vegetables.........
+ 16
+ 8
+ 41
Confectionery........
5
Groceries—full-line
+ 21
wholesalers........ 38
18
+ 25
— a
+ 6
Groceries—specialty7
— 9 + 37
line wholesalers... 10
+ 11
— 10
4
— 6
— 8
Beer.....................
5
4
Hardware,—general.. ill
— 1
+ 19
+ 2
— 6
Hardware—industrial 3
+ 10
Machinery, equip
ment, and sup
plies, except elect.
+ 16 + 29
Paper and its
products.............
+ 43 + 17
Tobacco and its
products.............
7
+11
+ 34
+ 11
Miscellaneous........ 14
■
18
+
+ ,19
+ 17
+ 0
____TOTAL............. 129
+ 44 +18
59
+ 20
*Based on U. S. Department of Commerce figures
Place
DEPARTMENT STORE SALES AND STOCKS
INVENTORIES
SALES
No. of Percent Change No. of Percent Change
Stores March 1946from Stores Mar. 31, 1946, from
Report Feb.
28 Mar. 31
Mar. Report
ing Feb.
ing
1946
1945
1945
1946
ALABAMA
Birmingham__
+ 18
+ <12
+, H
Mobile..........
+ 13 — 3
Montgomery...
+ "5
+ 5
+ 11 — 1
FLORIDA
Jacksonville-+ 5 + 14
+ ,21 — 2
Miami...........
+ 4 + 10
+ 4 + 13
Orlando.........
+ '15 + 21
Tampa..........
+ 25 + "9
+ ,23 + 17
GEORGIA
Atlanta..........
+ 9
+ 12
+ 17 + 17
Augusta........
+ 27 + 13
+ 59 + 43
Columbus......
+ 19 — 9
Macon..........
+ 6
+ '32
+ 16 + 2
LOUISIANA
Baton Rouge...
— 2
+ 13 + 12
+ 12
NewOrleans...
+ 16 + 39
+ 9 — 2
MISSISSIPPI
Jackson.........
+ >18 + 3
+ 13 + 14
TENNESSEE
Bristol..........
3
3
+ 30 4- 6
+ 0
Chattanooga...
4
22
3
+ 15
+ 9
27
Knoxville......
4
+ il
+ 20
Nashville.......
+ '23
‘5
6
+ 24
+ 1-1
22
OTHER CITIES*.. 18
+ 14 + 25
+ 7
+ 13
DISTRICT......... 93
72
+ 12
+ 17
+ 8
+ 16
*When less than 3 stores report in a given city, the sales or stocks are
grouped together under 1 other cities.
March stands at 19 3 percent of the 1935-39 average and ex
ceeds the index for any other month in a number of years.
Unionized mines in Alabama, and presumably in Tennessee,
however, closed at the time of the nationwide coal strike at
the end of March. Steel plants in the Birmingham-Gadsden
area that had been operating at 95 percent of capacity for the
four weeks preceding the strike, according to the Iron Age ,
were reported at 89 percent for the week ended April 9 and
87 percent for the week ended April 16.
The District’s textile m ills used about 288,000 bales of cot
ton in March, 5 percent more than they consumed in Febru
ary. Since the later month was longer, the daily average rate
was about 3 percent lower in March than it was either in
February or in March a )^ear ago.
Prospective Plantings
If Sixth District farmers carry out their early planting plans
it seems probable that more rice (in Louisiana), more tobac
co, and more potatoes will be raised in the District this year
than last year. On the other hand there will probably be
somewhat less of the other principal crops.
Each year the United States Department of Agriculture
issues a report that shows the acreages that farmers intended
on March 1 planting to the various crops throughout the
country. The estimates are valuable to farmers in making such
changes in their acreage plans as may appear desirable. Other
causes of possible changes in the estimates include weather
conditions, price changes, labor supply, and financial con
siderations.
Nationally the prospective total acreage in principal crops
is smaller than the 1945 acreage by a little less than one per
cent. More acres are going into corn, spring wheat, oats, bar
ley, tobacco, and sugar beets this year than last, but less are
going into other principal crops. Because of a legislative
prohibition cotton is not included in this report.
In the District during 1945 farmers planted about 2 percent
less acreage in the 10 principal crops, excluding cotton, than
they did in 1944. Their planting intentions this year indicate
a further reduction of about 3 percent in the total acreage for
the same 10 crops. The estimates show an increase of 6 per
cent in tobacco acreage, an increase of one percent in the
acreage to be planted in potatoes, and an increase of 2 per
cent in the Louisiana rice acreage. The largest decreases indi
cated by the estimates are one of 14 percent in the acreage of
oats and one of 17 percent in the barley acreage in the four
states where it is grown. Other prospective decreases are
8 percent in soybeans, 4 percent in tame hay, 2 percent in
sweet potatoes, 3 percent in peanuts, and one percent in corn.
Notwithstanding these prospective decreases in a comparison
with last year’s acreages, seven of the 10 crops will be plant
ed to larger areas than they were given in the 10-year period,
1935-44. Increases of 27 percent for peanuts and 28 percent
for tobacco are indicated over the 1935-44 average, and in
creases of 40 percent for barley and 44 percent for oats are
also expected. Prospective acreages of tame hay and pota
toes are respectively 5 percent and 4 percent above the 10-year
average, and the planned rice acreage in Louisiana is 14 per
cent greater than the 1935-44 average. Decreases in compari
son with that period are 16 percent in corn and in soybeans
and 7 percent in sweet potatoes.
In Alabama acreage intentions reflect significant decreases
from last year for almost all crops except oats. The acreage
M
o n t h l y
R e v ie w
o f th e F e d e ra l R e s e rv e B a n k o f A tla n ta f o r A p r i l 1946
planted to oats is estimated to be about 5 percent more this
year. If indicated intentions are carried out the acreage plant
ed to corn will be about one percent less than it was a year
ago, to potatoes 4 percent less, to sweet potatoes 3 percent, to
soybeans, cowpeas, and barley 10 percent, to peanuts 12 per
cent, and to tame hay 7 percent.
Florida farmers intended in March to plant the number of
acres in corn and peanuts this year that they planted last year,
6 percent less acreage in sweet potatoes, but 14 percent more
in potatoes, 6 percent more in oats and tobacco, and one per
cent more in tame hay.
In Georgia prospects point to an increase of 10 percent in
the tobacco acreage and an increase of one percent in pea
nuts. The acreage of tame hay is planned to be the same as
that of last year, and there are prospective decreases of 14
percent in oats, 1 1 percent in barley, 10 percent in sweet po
tatoes and in soybeans, 5 percent in potatoes, and one per
cent in corn.
Louisiana farmers intended to repeat last year’s acreages
of tobacco and tame hay. They planned to give 4 percent more
acreage to sweet potatoes and 2 percent more to rice and to
potatoes but one percent less to soybeans, 7 percent less to
corn, 17 percent less to peanuts, and 20 percent less to oats.
In Mississippi the farmers planned increases, over the 1945
acreage, of 4 percent in potatoes, one percent in com, and
one percent in sweet potatoes. They made no change in the
tame hay acreage. Decreases of 5 percent are indicated for
soybeans; 10 percent for peanuts, cowpeas, and sorghums;
32 percent for oats; and 53 percent for barley.
Tennessee farmers planned increases of 3 percent in to
bacco over last year’s acreage and 2 percent in sorghums.
In other crops there are prospective decreases, ranging from
2 percent in corn through 5 percent in oats, 7 percent in sweet
potatoes, 8 percent in potatoes and in tame hay, 10 percent in
soybeans, 13 percent in barley, 17 percent in cowpeas to 25
percent in peanuts.
Despite prospective acreage decreases for some of their
principal crops, Sixth District farmers are apparently plan
ning to use more fertilizer this year than they did in 1945.
Mississippi figures are no longer available monthly, but the
sale of tax tags in the other five states during the first quarter
of this year indicated that fertilizer sales were 7 percent
greater than in the January-March period a year ago. The in
creases ranged from one percent in Georgia through 4 per
cent in Louisiana, 8 percent in Alabama, and 10 percent in
Florida to 33 percent in Tennessee.
Cash Farm Income
Sixth District farmers received 6 percent less cash income
from the crops, livestock, and livestock products they market
ed in January 1946 than from those they marketed in Janu
ary of last year. Income from crops was 5 percent less, and
cash received for livestock and livestock products was 8 per
cent less. January farm income was off 29 percent from the
December income. Total figures for the Six States almost al
ways rise rapidly from the year’s low point in July to a peak
in October. They also usually decline, sometimes irreguarly,
from October to the following July. Against this general pat
tern for the District, farm income in Louisiana reaches its
peak in November and that in Tennessee in December. In
Florida the high point of the year usually falls in April be
cause the movement of citrus fruits and spring vegetables to
market is then usually at its height.
3 9
S ix t h D i s t r i c t S t a t is t ic s
RETAIL JEWELRY STORE OPERATIONS
Number
ol
Percent Change
Item
Stores
Feb. 1946toMarch 1946
Reporting
29
+ 12
27
+ 3
Credit sales............................
27
+ 23
Accounts receivable, end of month.
29
— 3
Collections during month............
29
4* i
DISTRICT.........
BatonRouge...
Birmingham....
Chattanooga...
Jackson.........
Jacksonville__
Knoxville......
Montgomery...
Nashville...... .
NewOrleans...
DISTRICT.........
Atlanta..........
Birmingham__
Montgomery...
Nashville........
NewOrleans...
DEPARTMENT STORE SALES*
Adjusted**
Unadjusted
Mar.
Mar.
Feb.
Mar.
Feb.
1946
1946
1945
1946
1946
334
339
274
314
292r
387
386
288
367
339
387
416
305
337
323
307
329
238
298
274
328
358
312
278
262
310
344
274
268
292
336
392
407
36,1
375
372
333
326
339
289
294
347
26,1
282
265
275
337
268
228
350
287
328
289
293
360
343
396
401
300
393
275
303r
260
251
250
355
402
395
308
402
Mar.
1945
282
303
202
253
275
274
368
327
264
286
284
315
246
326
DEPARTMENT STORE STOCKS
Unadjusted
Adjusted**
Mar.
Mar.
Feb.
Mar.
Feb.
1946
1946
1946
1945
1946
171
179
192
200
200
266
293
280
268
299
148
144
132
152
138
197
192
177
188
186
257
317
304
330
298
141
,129r
lOlr
149
129r
Mar.
1945
171
274
136
187
267
107r
TOTAL.............
Alabama........
Georgia.........
Tennessee......
COTTON CONSUMPTION*
Mar.
Mar.
Feb.
1946
1946
1945
161
162
157
172
172
162
159
160
158
124
141
113
COAL PRODUCTION*
Mar.
Feb.
Mar.
1946
194^
1945
193
159
163
202
160
171
146
i73
i58
SIX STATES ,..
Alabama........
Florida..........
Georgia.........
Louisiana......
Mississippi.....
Tennessee......
MANUFACTURING
EMPLOYMENT***
Jan.
Feb.
Feb.
1945
1946
1946
152
108
ll;lr
130r
184
121
90r
154
90
105
105
141
159
114
l,15r
141
118r
120
1
0
6
r
133
1Q1
GASOLINE TAX
COLLECTIONS
Mar.
Feb.
Mar.
1946
1946
1945
132
136
95
136
139
97
153
154
94
125
128
91
1.21
129
91
121
122
81
128
138
112
CONSUMERS' PRICE INDEX
Feb.
Feb. Jan.
1946 1946 1945
134
131
ALL ITEMS... 134
147
144
145
141
144
Clothing... 146
114
Rent........ 114
114
Fuel, elec
tricity,
109
111
andice... 111
Home fur
141
145
nishings. . 144
Miscel
127
131
laneous.. 13.1
CRUDE PETROLEUM PRODUCTION
IN COASTAL LOUISIANA AND
MISSISSIPPI*
Mar. Feb. Mar.
1946 1946 1945
Unadjusted.. 207 205
204
202 203
Adjusted**... 207
ELECTRIC POWER PRODUCTION*
Feb. Jan. Feb.
1946 1946 1945
SIX STATES. 247 ♦ 249 287
Hydro
generated 295
286
274
Fuelgenerated 186
201
305
ANNUAL RATE OF TURNOVER OF
DEMAND DEPOSITS
Mar. Feb. Mar.
1946 1946 1945
Unadjusted.. 15.9 15.7 15.2
Adjusted**... 16.3 15.6 15.6
Index**...... 63.1 60.3 60.2
*Daily average basis
**Adjusted for seasonal variation
***1939 monthly average = 100; other
indexes, 1935-39= 100
r=Revised
M
4 0
T h e
o n t h l y
R e v ie w
o f th e F e d e ra l R e s e rv e B a n k o f A tla n ta f o r A p r i l 1946
N a tio n a l B u s in e s s
production advanced considerably in March and
appears to have declined only moderately in the early part
of April notwithstanding a complete shutdown in the bi
tuminous coal industry and some reduction in output at steel
mills. The value of retail trade has continued to set new
records during this period, and wholesale commodity prices
have risen further.
I
n d u s t r ia l
Employment
Employment in nonagricultural establishments rose by about
600,000 in March after allowance for seasonal changes. This
rise reflected increased employment in manufacturing—large
ly in the iron and steel group—and continued gains in trade
and construction. There were further substantial releases from
the armed forces. The total number of persons unemployed
remained at a level of about 2,700,000 in March.
Distribution
Department store sales rose sharply in March and continued
at a high level in the first half of April. Total sales during
the Easter season are estimated to have been about one fourth
higher than last year.
Freight carloadings (luring March were close to the record
rate for that month reached last year. In the first three weeks
of April loadings declined, reflecting the stoppage of bituminous-coal production. Shipments of most other classes of
revenue freight continued to increase.
Commodity Prices
Wholesale prices of agricultural and industrial commodities
continued to advance from the middle of March to the third
week of April. The general level of wholesale prices is now
higher than last September by something over four percent.
In recent weeks ceiling prices for a number of products have
been raised considerably, and where ceilings have been re
moved prices have greatly risen. A bonus of 30 cents a bushel
has been granted on wheat delivered by May 25 under the
certificate plan to help meet the critical food situation abroad,
and a like payment has been offered for 50 million bushels
of corn.
Subsidy payments for some commodities have been in
creased to prevent further price advances.
Industrial Production
Production at factories and mines, according to the Board’s
seasonally adjusted index, rose from a level of 153 percent
of the 1935-39 average in February to 169 in March. This is
slightly above the level reached last November before produc
tion was reduced by strikes in the automobile, electricalequipment, and steel industries. In April the index will prob
ably show a decline of three or four points as decreases in
coal and steel are only partly offset by continued increases
in other industries.
The large increase shown by the total index in March was
due for the most part to a sharp recovery in steel-ingot produc
tion following settlement of the labor dispute. There were pro
duction gains also in industries manufacturing automobiles,
S itu a tio n
machinery, stone, clay and glass products, furniture, textiles,
paper and rubber products. These gains in steel and other in
dustries were offset only in small part by declines in the nonferrous-metal industries, some food industries, and crude pe
troleum.
Steel-ingot production for the month of March averaged 84
percent of capacity as compared with 20 percent in February
and at the end of March was close to 90 percent. Subsequent
ly, due to reduced coal supplies, steel output declined and by
the fourth week of April was down to a rate of 74 percent
of capacity. In the automobile and machinery industries pro
duction increased substantially during the latter part of
March and the early part of April, reflecting improvement in
steel supplies and settlement of important wage disputes.
Output of stone, clay, and glass products continued to ad
vance in March, and production in the first quarter of this
year exceeded the previous peak levels reached at the be
ginning of 1943.
Output of nondurable goods rose further in March to a
level of 168 percent of the 1935-39 average, the highest level
since last June. Production of nondurable goods for civilian
use is now in larger volume than at any previous time. Activi
ty at woolen mills has shown an exceptionally large advance
since the end of last year and, with marked increases in cot
ton consumption and rayon shipments, the Board’s index of
textile production in March was at a level of 162 percent of
the 1935-39 average. This equals the previous peak rate at
the beginning of 1943.
Mineral production declined in March as a further advance
in coal production was more than offset by a decline in crudepetroleum output and by work stoppages at important metal
mines. Activity at bituminous-coal mines was suspended be
ginning April 1 owing to a labor-management dispute over a
new wage contract.
Bank Credit
Member bank reserve positions tightened in the last half of
March as Treasury deposits at the Reserve Banks were in
creased by large income-tax collections.
Banks sold short-term Government securities largely to the
Reserve Banks and drew down their reserve balances to meet
this loss of funds. Reserve positions were eased on April 1
in connection with the cash redemption of 2.0 billion dollars
of Treasury certificates on that date, and in the following
weeks banks bought Government securities and reduced bor
rowings at Reserve Banks.
Commercial and industrial loans at member banks in lead
ing cities increased further. Loans to brokers and dealers
rose at the end of March in connection with Treasury-security-retirement operations and declined sharply in the week
ending April 3. Deposits, other than those of the Treasury,
fluctuated considerably, reflecting large income-tax payments
and the April 1 tax-assessment date in Illinois.
Yields on long-term Treasury bonds have remained rela
tively steady following a sharp decline in January and the
first half of February.
@FedFRASER