Full text of Economic Review (Federal Reserve Bank of Atlanta) : December 31, 1945, Volume 30, Number 12

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Number 12

R econversion in P a n a m a City
in Panam a City, Florida, presents some
problem s that may be profitably considered at this time.
A knowledge of the city’s economic history and of its ex­
periences during the war should furnish the background
necessary fo r a study of its typical present conditions.
Cities grow in norm al times in proportion to their success­
ful adaptation to the circumstances of their location. W ar,
however, and especially the urgent strategic industrialization
of W orld W ar II, has provided abnorm al stim ulation to
many American cities. D uring the recent war period this
stim ulation resulted in some instances in a change in the
kind of economic development in a com m unity; in other in­
stances it resulted in a change in the degree of economic de­
velopment. In some areas, for example, plants for making
ammunition were established where no such plants had been
before; in others, old plants were expanded in order to double
the amount of cotton cloth produced.
It is in general true that a community which experienced
a change in degree of development has fewer problem s of
reconversion and therefore has retained more benefits from
its wartime experience, but it is not the whole truth. M ili­
tary and strategic considerations were upperm ost in the minds
of Government officials who were responsible for the loca­
tion of war enterprises. Economic considerations were ob­
served wherever they did not run counter to the necessities
of the moment. Therefore, war brought to many communi­
ties, almost as if by chance, new types of development for
which they are naturally adapted. Such communities, if their
living facilities kept pace with their wartime economic ex­
pansion, may sometimes have profited m ore than those com­
munities that merely increased in the degree of economic
development along traditional lines.
For various reasons, then, some communities must take up
where they left off before the war, salvaging whatever may
be profitably retained from the period of artificial expansion
and lessening resultant evils wherever possible. Other com­
munities will be able to take up where they left off at the
end of the war. A fter a brief period of adjustm ent those in
the latter group will be able to m aintain their economic
position at, or near, the wartime level and therefore retain
their wartime populations. In still other communities the ces­
sation of war activities has reduced the population, but not
to prew ar levels. W ar necessitated in these centers immediate
expansions of community facilities, expansions which were
necessary for norm al growth but which norm ally would have
occurred only over a period of a decade or more.
Panam a City is apparently in this third group. D uring the
war period the city and the surrounding territory in Bay
County, stim ulated chiefly by the W ainwright Shipyard and

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a large gunnery school at Tyndall Field, more than tripled
their prew ar population. This growth was accompanied by a
proportionate expansion of industrial and community facili­
ties. Now, with the shipyard closing out operations and with
Tyndall Field already greatly reduced in personnel, half of
the excess population has fallen away.
Local people are undisturbed, however, by the decrease in
population. B. S. Gordon, m anager of Gulf Power’s local
branch and chairm an of the city’s industrial bureau, says,
“We knew we had a sharp drop coming after the war but
thought we could take it in stride. And we have.” J. M.
Rainey, secretary-manager of the chamber of commerce, says,
“A ll during the war we planned for a postw ar city twice as
big as it was before, not three or four times as big. We don’t
want to be too big too soon.” Such statements im ply an as­
surance that is typical in Panam a City, an assurance based
on the natural advantages of St. Andrews Bay and the G ulf
beach and on the sound economic growth of the city and area
over a period of many years.
Although there were scattered settlements on St. Andrews
Bay and along the coast as fa r back as Spanish times, P an­
ama City is a new town. The present city is the result of the
consolidation, by act of the state legislature, of the three
towns of St. Andrews, M illville, and Panam a City. This
m erger occurred in 1925, after Panam a City had become
much larger than the other two towns. The sections of P an­
ama City that were form erly separate towns are still called
by their original names and, oddly enough, still retain sep­
arate post offices. St. Andrews, in the western section of the
town, is the site of the W ainw right Shipyard. M illville, in
the eastern section, is the site of the International Paper
Company’s plant.
In 1906 only two families lived in the area that, three
years later, became Panam a City. At that time construction
was begun on the A tlanta and St. Andrews Bay Railroad, and
the fact that the town later became much larger than M ill­
ville and St. Andrews seems to have resulted from Panam a
City’s position as the term inus of the railroad. St. Andrews
in that year was a town of 600 people, its business life de­
pendent on the resort trade and on the working of a now
exhausted oyster bed.
M illville in 1906 was a much larger town, fo r it was the
scene of operations of a sawmill owned by the GermanAmerican Lum ber Company, a corporation financed by Ger­
man capital. The company owned 75,000 acres of land anid
employed 1,500 people. It also furnished electric power for
the whole community. Other tim ber operations in the vicinitiy
were carried on by the Sale-Davis Company, which ran a
sawmill, and by the West Bay Naval Stores Company. About

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M on th ly R eview o f th e F ederal R eserve B a n k o f A tla n ta fo r D ecem ber 1945

5,000 people were engaged in collecting and distilling tu r­
pentine in the area that in 1913 became Bay County. Fish,
oysters, lum ber, and turpentine were the chief sources of
wealth in the early days. As the years passed, more summer
visitors came to enjoy the beaches of St. Andrews Bay and
the Gulf, and the trade that they brought increased the busi­
ness life of the section.
Most of the products were shipped weekly to Pensacola
until 1903 by sailing vessel and thereafter by steamship.
A fter 1908 the railroad opened up new markets to the north
for local products. The old pass into St. Andrews Bay was
deepened in 1910 from 12 to 22 feet. Later a new pass was
cut, with a channel of 27 feet, its present depth.
Through the years lum ber m anufacturing became more im ­
portant to the com m unity’s economy. D uring W orld W ar I
the German-American Lum ber Company, which was still
owned entirely by German stockholders, was taken over and
run at accelerated pace by the Federal Government. After
the war this m ill was bought from the Government by local
interests for 1.4 m illion dollars. By the late 1920’s, how­
ever, almost all the m arketable tim ber had been cut out in
the immediate vicinity of Panam a City. No selective cutting
had been practiced, and no regular replanting occurred un­
til after 1930. The community therefore found itself with
rapidly dwindling local resources fo r its chief industry,
which was suffering from dim inishing returns as it became
dependent on more and more distant tim ber stands.
Led by R. L. McKenzie, a lum berm an and the town’s first

mayor, local businessmen began to look around fo r a substi­
tute. They thought that the fishing industry and the provid­
ing of services fo r a resort population did well enough as
seasonal supplements. W hat they wanted was a stable, yearround enterprise, and they were not looking for a sm all one.
Through contacts in A tlanta and New Y ork they learned that
the International P aper Company was planning further ex­
pansion, and they set out to dem onstrate to the company’s
officials that Panam a City provided the p roper combination
of plant site, harbor, railroad, and accessibility to timberland. The result was that in 1929 the company started con­
struction on what was at that tim e th eir largest Southern
m ill.
Events have proved that the choice was a wise one for
Panam a City. The paper m ill began operation in 1931. Thus
even the tim ing of the project was fortunate. F or while most
other towns were suffering from the depression of the 1930’s,
Panam a City’s population of 5,000 doubled soon after the
completion of the paper m ill, and business life increased.
The International P ap er Company, of course, dominated
the industrial life of the com m unity before the coming of
the shipyard. It norm ally employs between 1,100 and 1,20C
in the m anufacture of paperboard for shipping containers.
Almost all of its raw m aterial is bought through pulpwood
contractors. The bulk of this tim ber now comes by barge
and railroad from a distance of between 75 and 250 miles.
The plant uses 1,200 cords of wood daily to produce 750
tons of paperboard, most of which goes in norm al times by

JA M A C IT Y
SHIPYA RDS,

BIRMINGHAM

COLUMBUS
MONTGOMERY

NEW ^ _
O r le ans "

PENSAS C O IA




TALLAHASSEE

IN T E R N A T IO N A L
V p a p e r CO.

M o n t h ly

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water to N orth A tlantic and foreign ports. The company’s
pay roll was 1.4 m illion dollars in 1939, 1.6 in 1940, 1.8 in
1941, 2.2 in 1942, 2.3 in 1943, 2.6 in 1944, and 2.3 fo r the
first 10 months of 1945. The increases in its pay roll during
the war resulted from overtime pay and Little Steel awards,
not from an increase in num ber of employees. In fact, from
January 1943 to May 1944 employment was 10 per cent be­
low norm al, and the company had difficulty in keeping its
essential product moving. From 1931 until Ju ly 1942 Inter­
national P aper was Panam a City’s sole source of electric
power, selling its surplus to the G ulf Power Company, non­
producing distributor for the area.
In norm al times commercial fishing in the vicinity engages
about 1,100 people, who clear 9.5 m illion pounds of fish
through Panam a City annually. Since 1942 the catch has
been only about 6.7 m illion pounds. Because of increased
prices, however, the average am ount of money derived an­
nually from local fishing operations has been approxim ately
one m illion dollars, slightly more than the average fo r p re­
war years.
Because of its location on the Intracoastal W aterway, P an­
ama City is an im portant term inal for petroleum products.
Several large oil companies— Gulf, Standard, the Texas Com­
pany, American Oil, P ure Oil, Shell, City Service, and Sunny
State— m aintain on St. Andrews Bay storage tanks with a
combined capacity of 18 m illion gallons.
Panam a City’s resort trade is one of the chief enterprises
in norm al times. Before the coming of the paper m ill the
population was twice as large during the summer as it was
in the winter. A fter 1931 the num ber of summer residents
steadily increased, but the form er ratio between summer and
winter populations has not been maintained. Approxim ately
3,000 beach houses are inhabited in norm al times only dur­
ing the resort season of four and a h a lf months.
W hen asked why the International P aper Company had
located its plant at Panam a City, officials of the company
said immediately, “The harbor.” When asked the same ques­
tion about the establishment of W ainwright Shibyard there,
officials of the J. A. Jones Construction Company, builders
of both yard and ships, gave the same answer. Climate is
another m ajor consideration, since shipbuilding is almost
entirely an outdoor operation, and it was adm ittedly im ­
portant that in Panam a City the company could count on
a maximum num ber of good working days. An adequate sur­
plus of electric power was also essential so that the yard
could be established without the immediate construction of
new lines. This was assured, fo r in Ju ly 1941 a line had been
run from D othan, A labam a, connecting Panam a City with a
m ajor Southeastern power source. In May 1944, when the
need for critical m aterials had lessened, a supplem ental
pow er line was run from Pensacola. It was fortunate, too,
that hundreds of beach houses, those owned by summer vis­
itors and those ordinarily rented only in the summer, could
be made available to war workers.
The shipyard occupies a 112-acre area with 4,660 feet
fronting on St. Andrews Bay. It is within the corporate lim ­
its of Panam a City and six and a h alf miles west of the busi­
ness center. Construction began on A pril 7, 1942. Three
months later the keel was laid fo r the first ship. In the busy
interim 69 buildings with total floor area of 615,273 square
feet had been put up. More im portant than the buildings
were the six ways with concrete assembling and welding



135

slabs in front of each. The ways, designed for end launching,
are 451 feet long and 77 feet wide above water, 180 feet long
and 40 feet wide below water. The yard was designed for
building the Liberty ship, a 10,000-ton transport ship, though
a few tankers, tank carriers, and aircraft cargo carriers were
also built.
The building of the yard presented few difficulties since it
was just another construction job fo r J. A. Jones’ engineers
and carpenters. Shipbuilding was a different m atter, and the
yard was ham pered at first by a lack of skilled workers.
W ainwright Shipyard was just being constructed at a time
when m any wartim e yards were already on fu ll production
schedules. All workers with shipbuilding experience had been
drawn from the area, and a skilled worker of any kind was
hard to find. The company sent some of its regular construc­
tion superintendents to other shipyards for training. It also
opened a metal-working school, but training unconnected
with production was not highly developed.
TABLE l
N UM BER O F EM PLO Y E ES AT W A IN W R IG H T SHIPY ARD
PAN A M A C ITY , FLO R ID A
M o n th ______________________ 1942_________ 1943

1944

1945

J a n u a r y ......................................................
F e b r u a r y ...................................................
M a r c h ..........................................................
A p r il........................................
59

9,470
11,309
12,758
13,645

14,952
14,753
14,443
14,801

10,484
10,086
9,582
8,348

M a y ........................................
J u n e ........................................
J u ly ..........................................
A u g u s t...................................

694
981
1,350
1,540

14,070
15,256
.15,236
14,647

11,665
13,040
1,1,432
10,452

8,013
8,200
7,600
6,296

S e p te m b e r ...........................
O c to b e r ........................................
N o v e m b e r .............................
D e c e m b e r .............................

2,730
4,647
7,013
7,457

14,075
14,294
15,035
14,473

10,412
10,437
10,387
11,086

3,169
2,043
.........
.........

In fact, the whole shipbuilding project at Panam a City
gives the im pression of having succeeded through successful
experim entation on the job. Since the company, up to the
opening of the W ainwright yard, had engaged in only a gen­
eral construction business, it had no well-tried shipbuilding
techniques to be taught to trainees and adapted to local con­
ditions. So carpenters learned to work in metal and built
ships at the same time. W hen company officials discovered
that output per man-hour was lagging on the third shift, they
cut it out and lengthened the other two shifts to nine hours
each, releasing the less efficient workers. In doing so they
reduced employment in the yard from 15,000 to 10,500, and
at the same tim e they increased total production about 50
per cent.
Success at the beginning of the operation is evidenced by
the fact that eight months after ground was broken the first
Liberty ship was launched. As the months passed, the ab il­
ity of the company to adopt more and more efficient sched­
ules and methods was reflected in the results achieved. Manhours per hull were reduced from 1,408,680 in November
1943 to 530,000 in November 1944. During the same period
the num ber of days a ship remained on the ways before
launching was reduced from an average of 134 days to 42
days, and the num ber of days in the outfitting dock declined
from 29 to 15. Later on, production time was reduced still
further. The last Liberty ship was launched in 30 days and
outfitted in nine.
Since the company built both the yard and the ships and
since most of the yard-construction workers became produc­

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tion workers on ships by learning new trades and joining
new unions, there was a steady increase in the num ber of em­
ployees from 59 in A pril 1942 to 12,256 in June 1943. Em­
ploym ent rem ained between 14,000 and 15,000 until A pril
of 1944, as indicated in table 1. In August 1944, after the
two-shift schedule had been adopted, em ployment dropped to
10,452 and rem ained between 10,000 and 11,000 until Feb­
ruary 1945. A fter th at tim e em ploym ent declined steadily as
contracts were completed. A t the end of October of this year
only 2,000 employees rem ained at the yard.
Pay ro lls at the shipyard increased from the beginning in
direct proportion to the num ber of employees. This fact,
which seems a truism , has im portant m anpow er im plications.
Under the wartim e stabilization program companies engaged
in building-construction work were able to pay higher hourly
rates than most companies engaged in m anufacturing work.
However, hou rly rates of pay in the South fo r shipbuilding
and fo r the construction trades were practically the same.
This circumstance enabled the J. A. Jones company to pass
from the yard-construction phase to the shipbuilding phase
without the hourly rate reductions which ham pered most
other m anufacturers attem pting a sim ilar continuity of em­
ployment.
TABLE 2
PAY RO LLS AT W A IN W R IG H T SHIPY ARD
PA N A M A C ITY
( I n T h o u s a n d s o f D o lla rs )
M o n th
J a n u a r y .............
F e b r u a r y .........
M a r c h ................
A p r il.................. ....................
M a y .................... ..................
J u n e .................... ..................
J u l y .................... ....................
....................
A u g u s t ___
S e p te m b e r ___ ..................
O c to b e r ........... ....................
N o v e m b e r ___ ....................
D e c e m b e r , , . . ....................

1942

1943

1944

1945

11.8

2,161.4
2.161.6
2,478.5
2,760.0

3,587.7
2,995.5
3,006.0
3,936.4

3,231.0
2,887.8
2,234.3
2,438.0

189.8
491.1
634.4
680.4

3,620.9
3,153.2
2,964.0
3,875.0

3,241.7
3 227..1
3,758.0
2,885.1

1,820.4
2,005.2
2,403.8
1,720.5

703.5
959.5
1,623.2
1,522.4

3,127.9
4,084.8
3,667.9
3,430.3

2,124.4
3,523.0
3,437.0
3,365.7

1,211.5

The am ount of the shipyard pay ro ll rose from $11,800
in A pril 1942 to 3.6 m illion d o llars in M ay 1943. U ntil the
last contracts began to be completed in 1945 it rem ained at
that level. The m inor fluctuations shown in table 2 resulted
for the most p a rt from the varying lengths of months. The
total pay ro ll was not appreciably affected by the elim ina­
tion of the th ird shift since overtime pay and changes in job
content fo r a larg er group of m ore highly skilled workers
resulted in higher take-home pay fo r employees on the other
two shifts.
The W ainw right S hipyard had on contract, principally with
the U nited States M aritim e Commission, 66 Liberty ships,
28 aircraft cargo carriers, eight tank carriers, and six tank­
ers. The last Liberty ship was com pleted in M arch of this
year, and the last three tankers are now at the outfitting dock.
Tyndall Field, the largest flexible gunnery school of the
A rm y A ir Forces, brought as m any new people to the area
as the shipyard did. It occupies 25,000 acres on the eastern
peninsula, one of the two arm s that form land-locked St.
Andrews Bay. The school rapidly went into operation, and
at peak perform ance in 1944 had A rm y personnel and tra in ­
ees consisting o f 1,500 officers and from 10,000 to 12,000 en­
listed men. By the end of the w ar 45,000 gunners had been




trained at the field. Also about 1,200 copilots for Flying F ort­
resses were trained there.
Though the im pact of T yndall Field on the business life
of Panam a City was great, houses fo r all except the officers
and civilian personnel were provided at th e field itself. Ci­
vilians at the field num bered about 800 in 1942, about 1,300
in 1943, and about 1,500 in 1944. A t the end of November,
when the school was no longer in operation, 1,350 civilians
were still employed. D uring full-scale operations a t the field
the civilian pay ro ll am ounted to about $300,000 a month.
The field seems to have been planned as a perm anent instal­
lation. The runways and aprons are of concrete, the hangars
of steel. A ll other buildings, w ith the exception of a few
civilian and Q uarterm aster Corps barracks, are constructed
of concrete and stucco. A ll roads in the reservation are of a
perm anent type of construction. It is rum ored that the field
will be a perm anent aircraft training school, but no official
word has been given.
On the western peninsula are a perm anent Coast Guard
station and a wartim e naval base. Though the num ber of men
at the Coast G uard station was increased during the w ar, the
personnel of these two units never exceeded 500.
A community w artim e project which had an im portance
out of all proportion to the num ber of workers em ployed was
the oil-storage term inal at Lynn Haven, a sm all suburb six
m iles away. D uring 1942 and i;he early p art of 1943 German
subm arines cut off alm ost all oil shipm ents by w ater from
Texas and Louisiana to the east coast. To meet the em er­
gency the Defense P lan t C orporation constructed a large
term inal at Lynn Haven and a sm aller one at Jacksonville
for the General A merican T ransportation Company. The plan
was to ship the oil by way of the Intracoastal W aterway into
Panam a City, from there to Jacksonville by tank car, and
from Jacksonville by barge to a ll other points on the east
coast.
The installations at Panam a City and Jacksonville were
completed in July 1943, and successful test shipm ents were
run. By that time, however, the subm arine menace had been
elim inated, and the p lan fo r shipm ent to Jacksonville was
abandoned. Instead the Navy used the P anam a City facilities
fo r the storage of Diesel oil which had come by barge from
Texas and Louisiana and which was to be sent by rail to
N orfolk. By this plan of shipm ent the Navy needed only 14
per cent of the tank cars that otherwise would have been re­
quired, a saving of 2,000 tank cars in the operation.
The four piers at the Lynn Haven term inal are equipped
with 12 pum ps, which can deliver from barges to the 10
storage tanks 24,000 barrels of oil an hour. The tanks have
a capacity of 20 m illion gallons. Twelve miles of side track­
ing perm it the sim ultaneous loading of 120 railro ad tank
cars. The whole unit was installed at a cost of six m illion
dollars. Because of the highly mechanized equipm ent Gen­
eral American T ransportation was able to operate the ter­
m inal fo r the Navy with only about 100 employees.
A lthough precise figures are not available, the population
of Panam a City apparently m ore than trebled under the im ­
pact of this w artim e economic development. The 1940 census
figures were 11,610 fo r the city and 20,686 fo r Bay County.
Between 1940 and 1942, in spite of considerable local busi­
ness expansion, little population growth occurred. The city
had 3,441 dw elling units in 1940 and 3,500 in 1942, accord­
ing to census reports. Several w ar agencies, just before the

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W ainwright Shipyard was built, estimated the population at
approxim ately 12,000.
An incom plete official census in the spring of 1945 gave
Panam a City 23,914 people and Bay County 43,188. At
the same time, however, 63,000 people in the county had
ration books. A lthough m ore books than that were probably
in circulation during the last seven months of 1943, the
period of greatest employment at the shipyard, the figure
should give a definite indication of actual population. Since
according to the 1945 census there were about 20,000 more
people in the county than in the city, it seems safe to say
that Panam a City had a population of about 43,000, or about
20,000 less than the num ber of county ration books. D uring
the war, then, Panam a City was three and a h a lf times its
form er size and Bay County three times its form er size.
Housing this new population was one of the most difficult
early problem s. The Federal Public Housing A uthority built
4,608 units, and private capital, often with Federal Housing
A dm inistration aid, was responsible fo r the erection of 1,061
dwelling units and 41 conversions. The public facilities con­
sisted of fam ily units, dorm itory units, and sites providing
trailer conveniences. M any of the privately financed houses
were built on the beaches so that they could be used later as
resort cottages.
Panam a City business life reflects this growth and decline
of population. Table 3 shows increases in retail sales from
January 1939 to M arch 1945. T hereafter until November
1945 only relatively sm all sales decreases occurred, even
though 20,000 people were leaving the community over the
same period. If the average of m onthly sales in 1939 is used
as a base, or 100 per cent, average m onthly sales fo r eight
retail stores— grocery, hardw are, furniture, clothing, depart­
ment, and jewelry— rose to 335 p er cent in 1944. In the first
10 months of 1945 sales were 12 per cent less than they were
in the corresponding months of the preceding year.
TABLE 3
V O L U M E O F SA L ES O F E IG H T RETA IL S TO R ES IN PANAM A CITY
(In T h o u s a n d s o i D o lla rs )
1939

1940

1941

1942

1943

1944

1945

J a n u a r y ........... .............
F e b r u a r y ......... ...........
M a r c h ................ ...........
A p r il.................. ...........

36.1
38.4
52.8
55.6

36.4
42.0
60.1
60.4

40.1
42.8
55.9
63.1

78.8
66.4
83.2
90.5

119.9
131.7
153.0
156.9

145.3
141.4
1I 8 I .8
179.7

148.9
148.4
172.6
148.2

M a y .................... ...........
J u n e .................. .............
J u l y .................... ...........
A u g u s t ............. ...........

61.7
49.1
55.0
52.5

73.1
57.7
55.8
56.5

72.5
72.3
70.0
88.3

107.8
105.9
104.6
108.1

176.4
162.6 .
164.2
159.4

178.5
180.7
159.6
160.8

149.8
160.7
133.8
128.0

S e p te m b e r . . . .............
O c t o b e r ........... ...........
N o v e m b e r .. . . ...........
D e c e m b e r .. . .

50.3
49.2
47.5
65.4

54.3
57.2
60.1
64.3

78.8
81.8
83.6
110.8

120.4
128.5
126.4
,175.0

153.9
178.6
176.8
215.8

150.8
175.3
18?.4
217.8

115.8
145.1

M o n th

Deposits in Panam a City’s two banks, the Commercial Bank
and the Bay N ational Bank, showed much greater changes
over the same period, as indicated in table 4. W ith average
m onthly deposits fo r 1939 as the base, the index of deposits
increased to 1,265 per cent at the end of October 1945.
Other evidences of growth are almost as striking. Panam a
City’s only daily newspaper, the News-flerald, increased its
circulation from 2,881 in 1941 to 12,113 in 1944. G ulf Power
in 1939 had 2,693 electric meters and sold 8.3 m illion kilo­
watt hours of electricity. In 1944 the company had 7,133
meters and sold 36.6 m illion kilow att hours. Several of the
new meters, however, were m aster meters serving thousands



of people in the Government housing units. Telephones in use
increased from 1,337 in 1939 to 3,443 in 1944, and postal
receipts from $45,694 to $197,095.
TABLE 4
BANK D E P O S IT S IN PA N A M A CITY
( I n M illio n s o i D o lla r s )
1939

1940

1941

1942

1943

1944

1945

J a n u a r y ...........................
1.5
F e b r u a r y ...................... ........1.3
M a r c h .................................... 1.2
A p r il............................... ........1.2

M o n th

1.3
1.3
1.3
1.4

1.5
1.5
1.4
1.5

2 .7
2.6
2.5
2 .7

6 .9
7 .6
6 .7
7 .7

11.5
,12.6
12.7
12.8

17.3
17.11
16.1
15.7

M a y ..........................................1.2
J u n e ................................. .......1.2
J u ly ................................. ........1.3
A u g u s t .......................... ........1.3

1.3
1.4
1.5
1.5

1.8
1.8
2.0
2.1

2.8
4.1
4.0
4.3

8.7
8.6
8.8
9.2

12.6
14.0
14.0
14.4

15.5
15.9
17.1
17.1

S e p te m b e r ...........................1.3
O c to b e r ........................ ........1.3
N o v e m b e r ............................1.3
D e c e m b e r ............................1.4

1.5
1.5
1.6
1.6

2.3
2.4
2.8
2.8

4.8
4.9
6.1
6.5

10.2
10.0
10.3
11.2

13.9
13.4
14.9
,16.6

.16.8
,15.2

The income of the city government reflected in p art the
same tendencies. Tax receipts showed no appreciable in ­
crease. In 1939 real and personal taxes were $105,260; in
1945 they were $117,557. However, insufficient basis of com­
parison exists, as in 1939 a 70-mill rate was charged on
partial valuation, and by 1945 the rate had been gradually
reduced to 9 m ills on total valuation. Business licenses, how­
ever. increased from $20,247 in 1939 to $47,962 in 1944.
That the city’s expansion was accompanied by growing pains
is suggested by a phenomenal increase in police fines from
$1,568 in 1939 to $71,420 in 1944.
Increased community facilities included the construction by
the Federal W orks A dm inistration of seven new school build­
ings and numerous additions to old buildings at a total cost
of approxim ately $350,000. There were 4,700 pupils and 165
teachers in 1940, and 10,000 pupils and 260 teachers in 1945.
Since 1940 the city’s three deep wells have been supple­
mented by one new city well and seven wells dug by the
United States Government. The city in 1940 had 41 miles of
water mains and 9 miles of sewer lines; with Federal aid it
put in during the w ar 23 miles of new water mains and 8
miles of sewers, exclusive of mains and sewers in Federal
Public Housing A uthority properties. D uring the same period
the city built a new jail at a cost of $60,000 and increased
the num ber of policemen from 7 to 18.
The end of the war checked or reversed some of these de­
velopments that were incident to population growth. W ith
the departure of approxim ately 20,000 people, consisting
chiefly of shipyard workers and their families, the housing
shortage disappeared. As of November 14, 1945, the Federal
Public Housing A uthority listed 4,226 Government-owned
units as available, of which 3,172 were vacant. M any of these
units are being moved to college communities fo r the hous­
ing of student veterans. Others are being converted into in­
dividual farm cottages under the rural-rehabilitation p ro ­
gram of the Farm Security Administration. Hundreds of
beach houses form erly rented to war workers in Panam a City
are again vacant.
Another result of the population decrease is that postal
receipts in Panam a City’s principal post office were $12,523
in October 1945, as compared with $19,198 in October 1944,
$14,939 in October 1943, and $8,849 in October 1942. These
figures would not indicate that the population of the city has

138

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o f th e F ederal R e se rv e B a n k o f A tla n ta fo r D ecem ber 1945

decreased approxim ately 50 per cent since October 1944, but tentialities, the bureau selected fo u r— cotton-yam and cottonthat is just what seems to have happened.
cloth m anufacture, furniture, food storage, and brewing —
City and county officials and businessmen, however, do not and published half-page advertisements in the M ay and July
seem to feel th at h ard tim es are coming to Panam a City. issues of im portant trade journals. The advertisements dealt
They believe th at the w ar enabled the community to catch with a salient economic fact of interest to industrialists in each
up with itself. F o r instance, they have felt fo r years that field: in Textile World with a large potential local supply of
their sewage disposal facilities were inadequate. They are women textile w orkers; in Furniture Manufacturer with an
now planning to buy the disposal p lan t constructed fo r the easily available supply of soft-textured hardw oods; in Food
Federal Public Housing A uthority and to spend $750,000 Industries with opportunities fo r enterprises in the quickm ore on their sewage disposal and w ater systems. Before the freezing of fish; and in American Brewer with the unlim ited
w ar they suffered also from crowded school conditions. Now local supply of water with chemical properties suitable for
they have adequate schools, and changes in state regulations the brewing industry. As soon as these advertisements ap ­
have enabled them to keep the num ber of teachers at the peared, 550 letters were w ritten to m anufacturers in these
four industries. A m onth later each recipient of a letter was
w artime level. Since school enrollm ent fell from 10,000 in
sent a copy of the m agazine Gulf States Industry, which con­
1945 to 7,700, student loads have been reduced, and better in ­
tained a feature story on P anam a City. Correspondence and
struction should result. Form erly the community was de­
conferences with interested m anufacturers have resulted in the
pendent on the International P ap er Company fo r its elec­
bringing in of two quick-freeze plants fo r storing commercial
tricity. The two new lines are now capable of providing twice
fish, two building-block factories, and an ice-cream plant.
as much electricity as the community needs. Before the war,
The most significant postwar plan in Panam a City is the
housing facilities were inadequate. Today there are thousands
of vacant housing units, including both tem porary and per­ projected development of the w ater front. F or m any years
the beaches around Panam a City have been p o pular vacation
m anent types. Even if the Government removes all tem porary
grounds
for fam ilies of m oderate means from A labam a and
housing, the community w ill still have a thousand more units
Georgia. The new resort facilities on St. Andrews Bay are
than it had before the war.
M any war-boom towns find themselves in just such cir­ designed fo r this type of resort trade. The plans include a
cumstances. A pparently possessed of all the essentials for hydraulic fill that w ill make 17 acres of land, a boardw alk
industrial expansion, such communities are tem pted to en­ 900 feet long, a dance pavilion, a yacht basin, an auditor­
courage all kinds of m anufacturers to move in and provide ium, and a recreational area. Contracts are now being nego­
employm ent fo r displaced w ar workers. If this sort of activ­ tiated on the project. The cost is estimated at 1.3 m illion
ity results in a growth of m arginal enterprises th at can thrive dollars. A fu rther expansion in the same direction is the p ro ­
only under abnorm ally prosperous conditions, the communi­ jected building of a 100-room hotel on the G ulf beach about
ties in which the expansions occur m ay experience serious six miles west of the center of town. Such plans point to
what seems to be a justifiable development of the commu­
difficulties in a period o f business recession.
P anam a City’s postw ar plans, conceived and p artially ef­ nity’s n atu ral, advantages.
fected during the war, indicate that civic leaders do not in ­
T hat local business and civic leaders have confidence in
tend indiscrim inate industrialization. A pattern of action had the economic future of Panam a City is evidenced by the
been set when the International P ap er Company m ill was planning of private and public buildings, m any of which
brought in. This early effort in industrialization has been an are now under construction. They include 18 new buildings
entirely satisfactory community experim ent, and the men who put up by retail and service businesses, a church, a city hos­
encouraged the m ill’s establishm ent and later enlargem ent pital, and a bridge across N orth Bay— all at an estimated cost
are still influential in public affairs. They are interested in of approxim ately two m illion dollars. This new construction*
finding financially stable enterprises of desirable type which however, is not in anticipation of future growth but is evi­
can profit b y the economic advantages in­
dently necessary to take care of the present
herent in the com m uunity’s location.
population, which is now about a hundred
W ith postw ar development in m ind the
per cent above the prew ar level.
city, early in 1944, bought up 130 acres of
The history of Panam a City’s economic
industrial sites so th at it could offer im ­
life exemplifies successful community
mediate posesssion to desirable enterprises
adaptation to the n atural advantages of lo­
and could discourage others. D uring 1944
cation. D uring the latter h alf of the city’s
and 1945 the city’s industrial bureau has
existence this adaptation has been largely
been engaged in establishing contact with
the result of studied effort, and the indica­
industries that m ight be interested in locat­
tions are th at such effort will have a con­
ing plants in P anam a City. The bureau,
trolling effect in future growth. The arti­
consisting of a chairm an and five mem­
ficial stim ulation of w ar brought a degree
bers, was organized as an adjunct of
of development that would have been im ­
the cham ber of commerce in the spring
possible in norm al times but apparently
of 1943. Its m ethod of establishing in ­
did not cause business and civic leaders to
dustrial contacts indicates that it is also
lose sight of the community’s natural eco­
motivated by the p rinciple of selective in ­
nomic possibilities. Panam a City should
dustrialization.
therefore be able to retain perm anent ad­
A fter considering desirable industries in
vantages from its recent w artim e expan­
G a n tr i e s P la c in g P r e f a b r ic a te d
the light o f the com m unity’s economic po­
sion.
J ohn T yree F ain




S e c t io n o l S h ip

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o f th e F ederal R eserve B a n k o f A tla n ta fo r D ecem ber 1945

139

B ank A nnouncem ents
h e Federal Reserve Bank of A tlanta announces the ad­
mission of three additional banks to membership in the
Federal Reserve System and the addition of one nonmember
bank to the Federal Reserve P a r List. The new member
banks are the Pan American Bank of Miami, a new bank
chartered by the state of F lo rid a; the Capital City N ational
Bank of Tallahassee, Florida, which was a conversion from
the Capital City Bank, a nonm em ber; and the American
Bank, St. Joseph, Tennessee. The bank added to the P a r List
is the Indian River Citrus Bank, Vero Beach, Florida.

T

Philips, Godfrey Smith, and Mrs. W. H. Smith, vice presi­
dents; Fred N. Lowry, vice president and cashier; and C. L.
Johnson, J. Y. Humphress, T. H. M iddleton, and M arvin Col­
lins, Jr., assistant cashiers. The directors are S. E. Teague,
chairm an, and 0 . C. Collins, Fred N. Lowry, A. F. Philips,
Godfrey Smith, and Mrs. W. H. Smith.
Tallahassee is the capital of the state of Florida. Its pop­
ulation, which was 16,240 in 1940, is now estimated to be
25,000. The city serves a rich trade area.

American Bank

Pan American Bank of Miami

The American Bank, St. Joseph, Tennessee, a nonmember
The Pan Am erican Bank of Miami is a newly organized in ­ bank which went on the P a r List on November 1, was ad­
stitution that opened fo r business on December 1 of this m itted to membership in the Federal Reserve System on De­
year. The bank occupies quarters in the Pan American Bank cember 26. This bank was first opened for business in 1910,
Building, originally known as the Security Building. It be­ and on June 30 of this year had capital of $25,000, surplus
gins operations with capital funds of a m illion dollars, rep­ and undivided profits of $11,000, and deposits of $472,000.
resented by capital of $750,000, surplus of $200,000, and
The officers of the bank are W. H. Belew, president; G. L.
undivided profits of $50,000.
Posey, vice president; M arvin A. Bryan, cashier; and Mabel
Officers of the new bank are P. J. Serralles, chairm an of Bryan, assistant cashier. J. H. Belew, W. H. Belew, F. F.
the bo ard ; T. T. Scott, president; Alvin E. F uller, execu­ Locke, Mabel Bryan, M. A. Bryan, G. L. Posey, and 0 . W.
tive vice president; Eduardo M orales, vice president; E. A. W hite are the directors.
Gerard, vice president; Jose Garcia, vice president; and W.
Indian River Citrus Bank
C. Payne, vice president and cashier. D irectors of the bank
are Jacobo L. Cabassa, Alvin E. Fuller, A dalberto Roig, The Indian River Citrus Bank, Vero Beach, Florida, a non­
George H. Salley, T. T. Scott, P. J. Serralles, Max M. Weiss, member bank located in the territory served by the Jackson­
and H arrison R. W illiams.
ville branch, went on the Federal Reserve P a r List and be­
P. J. Serralles, chairm an of the board, is also chairman gan rem itting at p ar on December 1. This bank had on July
of the Board of Credito Y A horro Ponceno of Puerto Rico
1 capital of $30,000, surplus of $54,000, and deposits of
and has been actively engaged for many years in the produc­ $4,768,000.
tion of sugar cane and the refining of sugar on the island.
Its officers are Joseph S. Earm an, president; A. A. S ulli­
He is actively identified with a group of associates in the van, vice president and cashier; and C. H. Newbold and
extensive development of land in South F lorida fo r the pro­ K itty W harton, assistant cashiers. The directors are M errill
duction of sugar cane and its processing.
Barber, J. S. Earm an, E. B. Hardee, E. P. Poole, and A. A.
T. T. Scott, president, is also president of the F irst Na­ Sullivan.
tional Bank of Live Oak, Florida, and is well-known through­
Vero Beach, with a 1940 popuplation of 3,050, is the seat
out F lorida as a banker and businessman. He is the owner of of Indian River County. The town is well-known as a citrusvaluable business properties in the city of Miami.
shipping point.
A.
E. Fuller, executive vice president, first came to Miami
in 1921 and was associated in an official capacity with banks
in the Miami area for the ensuing ten years. In 1931 he was
R e c o n n a is s a n c e
appointed director of the Departm ent of Finance of the City
S ix th D is tr ic t S ta tis tic s fo r N o v e m b e r 1945 c o m p a r e d w ith N o v e m b e r 1944
of Miami and became president of the M unicipal Finance
PEB C E N T D E C R E A S E ^
P E R C E N T IN C R EA SE
Officers Association of the United States and Canada.

Department |||iBiU)5ales
Departm ent $>tore Stocks

Capital City National Bank of Tallahassee
On being granted a N ational charter by the Com ptroller of
the Currency, the Capital City Bank of Tallahassee, Florida,
converted to the Capital City N ational Bank of Tallahassee
and became a member of the Federal Reserve System on De­
cember 15. This bank was organized in M arch 1895. Its first
published statement of June 30, 1895, showed deposits of
$41,210, capital of $39,800, and undivided profits of $1,000.
Ever since its founding the bank has grown steadily, and on
November 5 of this year it had total deposits of $9,501,000,
capital of $100,000, surplus of $200,000, and undivided pro f­
its of $85,300. This bank has been on the Federal Reserve
P ar List since January 1.
Officers of the bank are 0 . C. Collins, president; A. F.



F u im tu llH illlllin
Gasoline T a f l||i i||H ii |B l l ||g
Cotton C||iisumption
Bank H i t s
M ember

ifliUliHllli

M ember Baxi^|[|)||||||i^||UilWIIIK
Demand D e p « t t | | u s t e d

+

—
40

30

20

10

5

15

55

30

40

M o n t h ly

140

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o f th e F ederal R e se rv e B a n k o f A tla n ta f o r D ecem ber 1945

The D istrict Business S ituation
store sales in the Sixth Federal Reserve Dis­
trict have apparently increased in December about the
usual extent, follow ing a slight rise in November. W holesale
distribution, on the other hand, was down 4 per cent in No­
vem ber from what it was in October. In each of these lines,
however, the level is at present well above th at of last year.
Tractile activity and coal output increased in November, and
steel-mill production continues at a high level. A rise in un­
employment in the six states of the D istrict during the month
has accompanied a decline in the num ber of available jobs.
In agriculture, the latest estim ate of acreage harvested in 1945
falls only slightly below the acreage actually harvested in
1944.

D

e p a rtm e n t

Retail and W holesale Trade
In the last three m onths of 1945 departm ent store sales have
apparently averaged about 13 per cent higher than they did
in that p a rt of 1944. Sales have been greater in each month
of this year than they have ever been in the corresponding
month of previous years.
D uring the first h a lf of December, sales reported by about
thirty stores in the larger cities of the D istrict averaged 15
per cent m ore than they did in that period last year. If this
condition proves to be also true of the m ore than ninety stores
m aking m onthly reports, it w ill mean an increase of 38 per
cent in the daily rate of actual d o llar sales from November
to December. It w ill m ean further that the seasonally adjusted
index fo r December will be at 297 per cent of the 1935-39
average, o r one point below the adjusted index fo r November.
In November the daily rate of sales in the D istrict rose 13
per cent over the October rate. A fter adjustm ent fo r the in­
fluence of seasonal factors, however, the rise was only two
per cent. The November index this year was 9 p er cent above
that last year. Most of the reporting cities in the D istrict had
increases from October to November, the largest gain being
one of 29 p er cent at M iami. The exceptions were decreases
of 3 per cent at Jackson, 4 per cent at Baton Rouge and 8 per
cent at M obile. Com parisons with the November 1944 rate
show gains this year at most reporting cities, the two largest
being 21 p er cent at M iam i and 22 p er cent at Tam pa. De­
creases of 2 p e r cent at Knoxville, 7 p er cent at Columbus,
and 9 per cent at M obile are attributed to reductions in war
activities in those areas.
At those stores th a t classify their sales figures cash sales
accounted fo r 62 p er cent of the total in November, as they
did in October and Septem ber. Open-book credit sales ac­
counted fo r 34 per cent of the total in November and 35 per
cent in October, and instalm ent sales m ade up the rem ainders
of 4 per cent in N ovem ber and 3 per cent in October.
Inventories at the close of November had increased over
those a m onth earlier at M iam i and Macon but had declined
at other reporting cities. They were larg er than those for N o­
vember of last year except fo r decreases of 5 per cent at
Birmingham , 7 per cent a t Jacksonville, 8 per cent at M ont­
gomery, 10 p er cent at Chattanooga, 12 p er cent at Jackson,
and 15 p er cent at New Orleans.
W holesale distribution of m erchandise in November de­
clined 4 p er cent from its October level but rose 10 per cent
above the figure fo r November last year. By reporting lines,



the increases and decreases from the October volumes were
about evenly divided. Though total sales were 10 per cent
greater than they were a year ago there were decreases in
sales of confectionery, beer, industrial supplies, shoes and
other footwear, and tobacco and its products. Inventories in
November were up 6 per cent from those a m onth earlier and
were 12 p er cent larger than they were a year ago.

Industry
A serious shortage of labor continues to be the chief retarding
factor in lum ber production. D uring recent weeks unfavorable
w eather conditions have brought additional difficulties. Cold
rainy w eather over wide areas of the Southern pine belt has
caught the lum ber producers short of logs as well as of labor
and m achinery replacem ents. C urrent production schedules
are reported at the lowest level on the average since last
winter. If press reports are correct, released war w orkers and
discharged servicemen are not returning to the m ills and the
woods. A recently announced advance in lum ber ceiling
prices that reportedly average $2.25 a thousand feet was less
than the industry had hoped for. Because of the great demand
for lum ber and their unwieldy backlogs of unfilled orders
m any of the m ills have been forced to w ithdraw from the
market.
Activity at steel m ills in the Birmingham-Gadsden area has
been at 95 p er cent of capacity, according to the Iron Age,
since the first week in November. In the country as a whole,
operations recovered from a rate of 66 per cent of capacity at
the m iddle of October, a drop caused by the coal strike, to 83
per cent in each of the three weeks ending December 11.
Cotton m ills in Alabam a, Georgia, and Tennessee used an
average of 11,052 bales of cotton fo r each business day in
November. This represents a 9 per cent increase over October
in the daily rate and is the largest gain for any m onth since
March.
Coal production in Tennessee recovered in November from
the decline that occurred in October. The daily rate for
Tennessee and A labam a combined was up 11 per cent over
that in October and was 4 per cent greater than it was in
November a year ago.
Crude-petroleum production in coastal Louisiana and
M ississippi increased slightly m ore than usual in November.

Labor and Employment
The trend in employment in the Sixth D istrict, as elsewhere
in the country, is apparently still downward. Exclusive of
Louisiana, states in this D istrict on December 1 had an indi­
cated unem ploym ent volume of approxim ately 103,000. On
December 15 the num ber o f unem ployed persons had risen
to about 109,000.
In the same states the num ber of unfilled jobs on De­
cember 1 amounted to slightly m ore than 50,000. By De­
cember 15 this num ber had declined to little more than 40,000.
Aside from Louisiana, A labam a apparently ranks highest
of all the other Sixth D istrict states in the num ber of unem ­
ployed, having estimated unem ploym ent of approxim ately
43,000 on December 15. The areas of greatest unemployment
afe the Birm ingham , M obile, and T alladega labor-m arket
areas. In Birmingham it is estimated that probably 50 per
cent of the 15,000 people listed as unem ployed is composed

M o n t h ly

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of women, fo r whom there are few suitable job openings.
M any of these women should not be considered as constitut­
ing a perm anent p art of the labor supply, fo r they will un­
doubtedly retire from the labor m arket when they have ex­
hausted their unem ploym ent compensation benefits.
As soon as m aterials and the necessary num ber of skilled
workers are available, Birmingham w ill probably be able to
absorb a p a rt of its unemployed on construction projects.
Projects of this type on which definite estimates of cost have
been m ade now total 15 m illion dollars, and m any m ore are
assured fo r the future. Some of the building projects, such as
the seven-m illion-dollar program fo r school buildings and
facilities and the new m illion-dollar medical college, will
probably be under way in the near future.
A confusing factor in the Birm ingham labor situation is the
threat of a strike in the steel industry. Since the recent strike
vote was taken em ployers have become decidedly hesitant
about hiring additional workers.
The M obile labor-m arket area is the second most seriously
affected region in A labama. Job layoffs in M obile continue
to occur largely in the shipbuilding industry and in Govern­
ment work, although some workers have been reabsorbed in
both these fields. Out-m igration continues to run at the rate
of about 50 per cent of layoffs.
In the Talladega area layoffs have been occurring at the
large ordnance p lan t that has now been placed on the m arket
for sale. Few of the workers displaced have been absorbed,
and unemployment in the area was estimated at 4,800 on De­
cember 15. The situation is eased to some extent, however,
by a sm all excess of out-m igration over in-migration.
The M iami labor-m arket area had the largest num ber of un­
employed persons of all the other areas in F lorida on De­
cember 15 — 10,000. Out-of-state workers have been entering
the area in increasing numbers, even while m any workers a l­
ready there were leaving because of the very serious housing
shortage. Hotels and restaurants are having no difficulty in
securing workers, but there is an apparent shortage of labor
in the lower wage brackets. The greatest demand fo r workers,
both skilled and unskilled, seems to be in the construction
industry. There is also, however, a shortage of auto me­
chanics, ground and a ir radio operators, and refrigerator and
air-conditioning mechanics.
In the Tam pa labor-m arket area, the next most seriously
affected area in the state, layoffs are due m ainly to norm al
turnover. The situation is worsened, however, by the excess
of in-m igration over out-m igration, and, in addition, job
opportunities are apparently reaching a tem porary saturation
point since em ployers’ needs fo r expansion have almost been
met.
The A tlanta labor-m arket area reported approxim ately
7,500 unemployed on December 1 and 7,700 on December 15.
Although the num ber of unemployed increased very slightly,
the num ber of unfilled jobs declined from 8,100 on December
1 to 4,300 on December 15. The large num ber of unfilled jobs
reported on December 1 was probably the result of an in­
crease in the num ber of clerks required by retail stores for
the Christmas season. Aside from this seasonal demand for
labor by the retail trade, the largest demand is found in the
construction industry, in transportation and public utilities,
in the fertilizer and textile industries, and in domestic service,
hotels, restaurants, and other m iscellaneous fields.
In those Tennessee labor-m arket areas of the Sixth Dis


141

S ix th D is tr ic t S ta tis tic s
C O N D IT IO N O F 20 M EM BER BANKS IN S ELE C TED C IT IE S
( I n T h o u s a n d s of D o lla r s ) D e c . 19
1945

Ite m

L o a n s a n d in v e s tm e n ts
T o t a l..........................................
L o a n s — t o t a l...............................
C o m m e rc ia l, in d u s tr i a l,
a n d a g r i c u lt u r a l l o a n s . .
L o a n s to b r o k e r s a n d
d e a le r s in s e c u r i t i e s ___
O th e r lo a n s fo r p u r ­
c h a sin g a n d c a rry in g
s e c u r i t i e s .............................
R e a l e s ta te l o a n s ..................
L o a n s to b a n k s ......................
O th e r l o a n s .............................
I n v e s tm e n ts —t o t a l ..................
U . S. d ir e c t o b l i g a t i o n s . ..
O b lig a tio n s g u a r a n t e e d
b y U . S .................................
O th e r s e c u r i t i e s ....................
R e s e r v e w ith F . R . B a n k ___
C a s h i n v a u l t .............................
B a la n c e s w ith d o m e s tic
b a n k s ........................................
D e m a n d d e p o s it s a d j u s t e d .
T im e d e p o s i t s .............................
U. S. G o v 't d e p o s i t s ...............
D e p o s its o f d o m e s tic b a n k s .
B o r r o w in g s .................................

N o v . 21
1945

D e c . 20
1944

Per C ent C hang*
D e o . 19, 1945, fro m

2,302,953 2,076,067 1,799,808
404,524
365,726
547,545

N o v . 21
1945
+
+

11
35

D e e . 20
1944
,+
+

28
50

248,429

220,872

214,639

+

12

+

16

16,623

8,464

7,440

+

96

+

123

156,478
66,735
51,810
23,520
23,245
23,828
3,476
2,459
2,278
99,019
82,749
65,734
1,755,408 1,671,543 .1,434,082
1,605,303 1,523,526 1,292,344

+
+
+
+
+
+

134
1
41
20
5
5

+
—
+

0
1
1
3

—
+
+
+

94
22
12
4

+ 25
—
3
—
0
+ .135
+
8

+
+
+
+,
+

12
13
29
82
18

1.121
148,984
372,622
31,837

1,121
146,896
377,846
31,045

, ,19,400
122,338
331,498
30,615

171,251
,137,235
152,538
1,260,861 1,299.252 ,1,114,309
414,205
320,877
414,193
473,296
201,409
259,478
614,875
571,800
519,094
23,900

+ 202
—
1
,+ 53
+
51
+
22
+
24

D EB ITS T O IN D IV ID U A L BANK A C C O U N T S
( In T h o u s a n d s of D o lla rs)

P la c e

ALABAMA
A n n is to n .............
B ir m in g h a m ___
D o th a n ..................
G a d s d e n .............
M o b ile ..................
M o n tg o m e r y .. .

N o . of
B anks
R e p o r t­
in g

N ov.
1945

O c t.
1945

N ov.
1944

P er C en t C h an g e
N o v . 1945 fro m
O c t.
1945

N ot.
1944

3
3
2
3
4
3

15,742
219,138
11,263
13,437
91,367
50,058

16,946
205,630
11,072
13,095
92,537
50,473

18,699
193,086
9,261
12,113
130,735
42,460

+
+
,+

,3
6
10
2
3
3
3

189,935
157,232
220,051
35,282
26,928
35,129
82,129

175,045
149,067
203,012
29,433
27,089
31,610
72,062

174 563
110,969
154,605
26,925
23,394
25,709
80,259

-j- 9
+
5
+
8
+ 20
1
11
+ 14

+
9
+ 42
+ 42
+ 31
+ 15
+ 37
+
2

N e w n a n .............
S a v a n n a h ...........
V a ld o s ta .............

2
4
3
2
4
2
3
2
4
2

15,41(1
538,722
39,460
9,946
39,376
3,075
45,,147
7,756
70,263
9,980

13,069
551,5(22
38,680
10,728
40,346
3,418
42,977
5,259
71,632
9,664

1.2,707 • + 18
488,5(16
2
34,030
+
2
14,837
7
36,465 __ 2
2,095 ___ 10
41,909 ■+ 5
5,805
+ 47
83,828
2
7,079
3
+

4 -2 1
+ . 10
+ 16
— 33
+
8
.+ 47
+
8
+ 34
— 16
+ 41

LO U ISIA N A
B a to n R o u g e . ..
Lake C h a rle s . . .
N e w O r l e a n s . ..

3
3
7

49,242
20,350
456,714

49 271
18,783
435,449

42,,111
16,449
451,758

,__
i+
+

0
8
5

+ 17
r f 24
+
a

M IS S IS S IP P I
H a ttie s b u r g .. . .
J a c k s o n ...............
M e r id ia n .............
V ic k s b u r g .........

2
4
3
2

14,082
69,989
20,557
23,649

14,937
66,855
22,368
2 1 ,ai3

16 844
59,047
17,624
23,406

__
+

6
5
8
8

— 16
■ + 19
•+ 17
H- 1

TEN N ESSEE
C h a tta n o o g a ...
K n o x v ille ............
N a s h v ille ...........

4
4
6

92,989
101,569
201,442

89,418
109,264
195,957

87,334
111,793
173,228

+
+

4
7
3

+
6
— 9
+ 16

SIXTH D ISTR IC T
32 C i t i e s .............

104

2,757,359

2,685,469

2,575,038

+

3

+

7

79,401,000 81,614,000 77,775,000

—

3

+

2

FLO R ID A
J a c k s o n v ille ___
M ia m i....................
G r e a te r M iam i*
O r la n d o .............
P e n s a c o l a ...........
S t. P e te r s b u r g .

—

7
7
2
3
1
1

—
+
+
+
—
+

16
13
22
1.130
18

G E O R G IA
A tla n ta ................
A u g u s t a .............
B r u n s w ic k .........
C o lu m b u s ...........
E l b e r to n .............

U N ITED STATES
334 C i t i e s ...........

*N ot in c lu d e d in S ix th D is tric t to ta l

%

+

142

M o n t h ly

o f th e F ederal R e se rv e B a n k o f A tla n ta fo r D ecem ber 1945

R e v ie w

S ix th D is tr ic t S ta tis tic s
RETAIL JEW ELRY S T O R E O P E R A T IO N S
N um ber
I te m

P er C ent C hange
O c to b e r 1945 to N o v e m b e r 1945

S to r e s
R e p o r tin g

T o ta l s a l e s ...................................................
C a s h s a l e s .................................................
C r e d it s a l e s ...............................................
A c c o u n ts r e c e iv a b l e , e n d o f m o n th
C o lle c tio n s d u r i n g m o n t h ..................

22
21
21
22
22

+ 19
+ 14
+ 23
+ 10
+ 17

RETAIL FU R N ITU R E S T O R E O PE R A T IO N S

Ite m

N um ber
oi
S to r e s
R e p o r tin g

T o ta l s a l e s ...................................................
C a s h s a l e s ...................................................
I n s ta lm e n t a n d o th e r c r e d i t s a l e s . .
A c c o u n ts r e c e iv a b l e , e n d o i m o n th
C o lle c tio n s d u r i n g m o n t h ..................
I n v e n to r ie s , e n d o i m o n t h ..................

ai
70
70
78
78
65

Per C ent C hange
N o v e m b e r 1945 iro m
O c to b e r 1945 N o v e m b e r 1944
+
+
+
+
+
+

+
5
+ 11
+
3
+
3
+
5
— 4

23
54
15
3
17
19

D EPARTM ENT S T O R E S A L ES A N D S T O C K S
IN V E N T O R IE S

SA L ES
P la c e

N o. oi
S to r e s
R e p o r t­
in g

ALABAM A
B ir m in g h a m ...
M o b ile ................
M o n tg o m e r y .. .
F L O R ID A
J a c k s o n v i l l e .. .
M ia m i..................
O r l a n d o ..............
T a m p a ..................
G E O R G IA
A tla n ta ................
A u g u s t a ..............
C o lu m b u s .........
M a c o n ..................
L O U ISIA N A
B a to n R o u g e . . .
N ew O rle a n s ..
M IS S IS S IP P I.........
J a c k s o n .............

TENNESSEE

5
5
3

N o. o i
S to r e s
R e p o r t­
in g

P er C ent C hange
N o v . 1945 iro m
N ov.
O c t.
1944
1945
+
—
+

P er C ent C hange
N o v . 1945 iro m
O c t.
N ov.
1944
1945

5
8
4

+
9
— 9
+ 19

4

—

5

—

5

3

—

3

—

8

3
3

— 19
+
3

— 7
+ 21

4
4
3
5

+
+
+

29
11
17

+
6
+ 21
+ 12
+ 16

3

—

5

+

11

6
4
3
4

+
+
+
+

8
3 •
‘1
13

+ 16
+ 18
— 6
+ 17

5
3

— 2
— 10

+
+

.1
10

4

+

8

+ • 30

4
4

—
+

4
1

+
+

15
3

4
3

—
—

3
7

+
o
— 15

4

—

3

+

6

4

—

3

— 12

3
3

— 1

+
8
— 10

B r i s t o l . ................
3
+ 14
C h a t t a n o o g a . ..
4
+
3
+ 13
— 2
K n o x v ille ...........
4
+
0
N a s h v ill e ...........
+ 18
6
+
3
O T H E R C IT IE S * .
18
+ 15
D IS T R IC T ..............
93
+
6
+ 11
• W h e n l e s s t h a n 3 s to r e s r e p o r t in a g i v e n c ity ,
g r o u p e d t o g e t h e r u n d e r ' o th e r c i tie s .'

—

9

5
— 3
+
7
22
— 6
+
5
72
— 4
+
1
th e s a le s o r s to c k s a r e

W H O L E S A L E S A L ES AND IN V E N T O R IE S* — N O V EM BER 1945
I

R e­
p o r ti n g
A u to m o tiv e s u p p lie s .
C lo th in g a n d
S h o e s a n d o th e r
f o o tw e a r ......................
D ru g s a n d s u n d r ie s ..
D ry g o o d s ......................
E le c tric a l g o o d s .........
F r e s h f r u its a n d
v e g e t a b l e s ................
F a rm s u p p l i e s ..............
C o n f e c tio n e r y .............
G r o c e r ie s — f u ll- lin e
w h o l e s a l e r s .............
G r o c e r ie s — s p e c i a lt y
lin e w h o l e s a l e r s . . .
B e e r .................................
H ard w are— g e n e r a l..
H a r d w a r e — in d u s tr ia l
M a c h in e r y , e q u i p ­
m e n t, a n d s u p p lie s
T o b a c c o a n d it s

SA LES
P er C ent C hange
N o v . 1945 iro m
O c t.
N ov.
1944
1945

7

+

16

+

61

4

—

7

+

1

IN V E N T O R IE S
Per C ent C hange
N o v . 1945 iro m
N ov.
O c t.
1945
1944

N o . oi
F irm s
R e­
p o r tin g
4

7

— 2
+
7
4- 12
+ 38

5
3
5

+
+
+

1
o
5

+ io
+
7
— 8

37

—

2

+

H

15

24
19
15
14

6

9
3
9
4

+ 19
—
— 5
+ 2

+
—
+
—

3

—

+ , 10

6
10
M is c e l la n e o u s .............
134
T O T A L ....................
• B a s e d o n U . S . D e p a r tm e n t of




2

— 14
— 5
— 2
+■ 3
— 4
+ 10
C o m m e rc e f ig u r e s

1

+

11

Agriculture

+ 21
— 5
— 27
+
6

3
8
11

+

trict fQr which reports are available unem ploym ent increased
from 26,000 on December 1 to 28,000 on December 15. U n­
filled jobs, on the other hand, decreased from a little more
than 12,000 to approxim ately 9,000.
The N ashville labor-m arket area on December 15 had the
largest num ber of unem ployed persons — 5,500. A sm all but
steady demand fo r certain skilled workers, such as printing
pressmen, auto mechanics, and m olders, is continuing. U n­
skilled jobs, however, are still difficult to fill because of wage
rates. Since the housing situation is extrem ely tight, it is also
difficult to attract qualified w orkers fo r job openings in the
m ore highly skilled categories.
A pproxim ately 5,000 unem ployed are reported by the
Chattanooga labor-m arket area, the largest num ber in any
area of the state except Nashville. On the other hand, this
area reports 2,200 unfilled jobs. Indeed, critical labor short­
ages are reported in the iron and steel and textile industries.
Shortages of unskilled labor are said to be serious. A p­
parently, workers who have acquired wartim e skills are still
reluctant to take unskilled or sem iskilled jobs as long as they
are receiving unem ploym ent compensation benefits.
The New Orleans labor-m arket area reported 17,000 unem­
ployed in November, the last m onth for which figures are
currently available. This is in contrast to 12,500 in October.
Ever since V-J Day, predictions of expanded employment
have been made, but so fa r they have not m aterialized. The
greatest decline in em ploym ent has occurred in the ship­
building trades, and the next greatest in ship repair. The ma­
jority of workers that have been added to the labor supply
during the last reporting m onth have become available
through the inactivation of shipbuilding establishm ents and
separation from the arm ed forces. The greater num ber of
male workers who became available during the m onth of No­
vember were skilled or semiskilled. Of the fem ale workers the
m ajority consisted of clerical and semiskilled groups, but
despite an increase in the supply a shortage of stenographers
still prevails. Job openings in the skilled categories are re­
ported to be very lim ited, and wages are low. Em ployers are
also becoming m ore selective in their hiring in an effort to
im prove the quality of the present labor forces.
Despite the present volume of unem ploym ent and the dis­
parity between wages asked and em ployer specifications that
makes it difficult to fill jobs in some categories and despite
some uncertainty in the progress expected in reconversion, the
labor situation is not expected to become too serious. It is
expected that the tu rn of the new year w ill bring fulfillm ent
of the hopes for expansion of employment.

3
5
4

+
2
+ 22
+
3

+
2
— 13
+ 99

+

—

+

4

14
55

+
+

11

5

3

+ ' 12

0

+

8
6

+
7
-f* 12

9

A 1945 cotton crop of 4,113,000 bales in the Six States is in ­
dicated in the latest m onthly estim ate by the U nited States
D epartm ent of A griculture based on inform ation available
on December 1. There were no changes in the November esti­
mates of the crop in A labam a, Florida, Louisiana, and
Tennessee, but the estimate fo r Georgia had increased 10,000
bales, and that for M ississippi had declined 5,000 bales. Be­
tween August 1, when the first estim ate of the 1945 crop was
made, and December 1 expected production in the D istrict
declined 7 per cent, or 302,000 bales. The estimate fo r A la­
bam a increased 4 per cent in this period, and that for
Tennessee 15 p er cent. In the other four states, however, there
were decreases ranging up to 27 per cent fo r Louisiana, where
late planting was followed by frequent and prolonged rainy

M o n t h ly

R e v ie w

143

o f th e F ederal R eserve B a n k o f A tla n ta fo r D ecem ber 1945

spells that induced excessive p lant growth, resulted in greater
weevil damage, and slowed m aturity of the bolls.
In the Six States combined the crop this year is sm aller by
17 per cent, o r 837,000 bales, than th at produced in 1944.
By states, decreases range from 7 p er cent in Alabama,
through 12 per cent in Tennessee, 17 p er cent in Mississippi,
18 per cent in Georgia, and 36 per cent in Louisiana to 38
per cent in the sm all cotton-producing state of Florida. For
the country as a whole, the December estimate is 9 p er cent
below the first estimate of the season in August and 25 per
cent lower than the 1944 crop.
The harvested acreage is estimated at only one per cent less
than the acreage th at was under cultivation in the D istrict on
Ju ly 1. F or the cotton-producing states, however, the reduc­
tion was 3 p er cent.
Per-acre yields were lower this year than last in all the Six
States, the decreases ranging between 5 per cent in Alabama
and 30 p er cent in Louisiana. The largest yield, 377 pounds to
the acre, was reported fo r Tennessee. N ationally the yield
this year was estimated at 250 pounds an acre, a reduction of
15 p er cent from th at of last year. In the first three quarters
of 1945 the D istrict’s farm ers received about 1.15 billion dol­
lars for the crops, livestock, and livestock products they
marketed. This total is 11 per cent greater th an the am ount
received in the corresponding p art of last year and exceeds
figures fo r other recent years. O f this large total, receipts
from crops have accounted fo r 65 p er cent, o r $755,272,000.
Receipts from m arketings of livestock and livestock products,
am ounting to $398,435,000, accounted fo r the rem aining 35
per. cent. Income from crops was 16 p er cent greater than
it was in the same period of 1944, whereas receipts from live­
stock and livestock products increased only 1.5 per cent. In ­
come from cotton, tobacco, truck crops, and fru it was higher
than it was a year ago, and though receipts from poultry,
eggs, and m ilk increased, returns from meat anim als were
less.

Life Insurance Sales
Sales of life insurance registered a fu rth er sm all m onthly
gain in November and in addition a 15 per cent rise over the
November 1944 volume. As in other recent months, the No­
vember total is larger than the sales reported fo r the corres­
ponding m onth in any of the past 15 years. By states, the
comparisons w ith November 1944 gave results ranging from
a decrease o f a sm all fraction o f one p er cent in M ississippi
through increases of 8 p er cent in Louisiana, 9 p er cent in
Georgia, 12 per cent in Tennessee, and 26 per cent in F lorida
to a gain of 28 per cent in A labam a.

Banking
Net circulation of this bank’s Federal Reserve notes increased
only 12 m illion dollars during November, one of the sm all­
est m onthly increases of the year, but in the first three weeks
of December there was a further rise of 15 m illion dollars.
At $1,494,000,000 on December 19, notes in actual circula­
tion amounted to 225 m illion dollars m ore than those in cir­
culation a year ago.
At weekly reporting member banks in the District, demand
deposits adjusted and tim e deposits were somewhat lower at
the m iddle of December than they were a m onth earlier but
were, respectively, 13 p er cent and 29 p er cent greater than
they were a t th at tim e last year. T otal loans, which have re­
cently increased, were h a lf again as large as they were a year
ago.



S ix th D is tr ic t S ta tis tic s
IN STALM ENT C A S H LO A N S
L eader

N um ber
ol
L e n d ers
R e p o r tin g

F e d e r a l c r e d i t u n i o n s ...........................
S ta te c r e d i t u n i o n s .................................
I n d u s tr ia l b a n k i n g c o m p a n ie s .........
I n d u s tr ia l lo a n c o m p a n ie s ..................
S m a ll lo a n c o m p a n ie s ...........................
C o m m e rc ia l b a n k s .................................

43
25
10
22
50
34

P er C ent C hange
O c to b e r 1945 t o N o v e m b e r 1945
V o lu m e

O u ts ta n d i n g s
+
—
+
+
+
4-

+
9
+ 10
+
6
+ 3
— 5
+ 17

2
0
7
3
4
6

D EPARTM ENT S T O R E SALES*
U n a d ju s te d

A d ju s te d *

D IS T R IC T ................
B a to n R o u g e . . .
B irm in g h a m ___
C h a tta n o o g a ...
J a c k s o n ................
J a c k s o n v ille ___
K n o x v ille ...........
M ia m i....................
M o n tg o m e r y .. .
N a s h v ille .............
N ew O rle a n s . . .
T a m p a ..................

N ov.
1945

O c t.
1945

N ov.
1944

N ov.
1945

O c t.
1945

N ov.
1944

298
378
328
293
302
279
394
343
318
305
317
358
2 50
370

292
338
284
266
288
284
334
328
280
305
316
334
258
356

271
327
288
267
268
264
377
348
273
2511
267
303
242
295

348
403
348
339
338
328
428
368
365
341
368
392
291
438

307
344
335
300
305
314
379
340
299
246
328
352
266
347

317
348
306
308
300
310
409
374
314
281
310
332
282
349

-

DEPARTM ENT S TO R E S T O C K S
A d ju s te d * »

D IST R IC T ................
A tla n ta ..................
B ir m in g h a m .. . .
M o n tg o m e r y .. .
N a s h v ille .............
N ew O r le a n s ...

U n a d ju s te d

N ov.
1945

O c t.
1945

N ov.
1944

192
260
126
183
3Q1
115

188
261
139
193
313
124

190
257
133
198
284
135

C O T T O N C O N S U M P T IO N *

TO T A L ......................
A la b a m a .............
G e o r g i a ................
T e n n e s s e e .........

N ov.
1945
202
300
149
213
’ 349
130

O c t.
1945

N ov.
1944

21.1
307
157
219
359
140

199
297
156
231
330
152

C O A L P R O D U C T IO N *

N ov.
1945

O c t.
1945

N ov.
1944

N ov.
1945

O c t.
1945

N ov.
1944

156
165
155
134

143
148
143
1.28

.160
163
161
137

169
177

152
179

.163
■171

ii>2

89

i46

M A N U FA C T U R IN G
EM PLO YM EN T* * *
O c t.
1945
SIX S T A T E S ...........
A la b a m a ..............
G e o r g i a .............
L o u i s i a n a ...........
M is s is s ip p i.........
T e n n e s s e e .........

G A S O L IN E TAX
C O L L E C T IO N S

S e p t.
1945

O c t.
1944

N ov.
1945

O c t.
1945

N ov.
1944

111
134
81
106
1,15
1,12
105

155
181
164
145
171
142
133

132
140
1.18
127
129
116
164

129
135
111
121
130
139
151

105
lill

88
103
1%
107
120

C O N S U M E R S ' P R IC E IN D EX

E L EC TR IC P O W E R . P R O D U C T IO N *

O c t.
1945

S e p t.
1945

O c t.
1944

O c t.
1945

S e p t.
1945

O c t.
1944

134
147
144
1.14

134
148
144
114

131
143
1,39
114

ALL IT E M S ..
F o o d ...........
C lo th in g ...
R e n t .............
F u e l, e l e c ­
tr ic ity ,
a n d ic e ..
H o m e f u r­
n is h in g s .
M is c e l­
la n e o u s . .

in

lid

109

145

145

139

131

131

126

C R U D E PETR O LEU M P R O D U C T IO N
IN COASTJ I L L O U ISIA N A AND
M tS S IS S IP P I*

U n a d j u s t e d . ..
A d ju s te d * * . . .

N ov.
1945

O c t.
1945

N ov.
1944

207
204

202
202

204
201

SIX S T A T E S ..
H y d ro ­
g e n e r a te d
Fuel-<
g e n e r a te d

232

252

263

213

234

212

256

275

331

ANN U AL R A TE O F T U R N O V ER O F
D EM AN D D E P O S IT S
•
U n a d ju s te d ...
A d ju s te d * * . .

N ov.
1945

O c t.
1945

.16.0
15,1
58.4

14.5
14.4
. 55.6

N ov.
1944
16.7
15.8
60.9

* D aily a v e r a g e b a s is
‘ ‘ A d ju s te d fo r s e a s o n a l v a r ia tio n
***11939 m o n th ly av e ra g e= > 1 0 0 ;
o th e r in d e x e s , 1 935-39= 100
r= R e v is e d

144

M o nthly R eview o f th e F ederal R eserve B a n k o f A tla n ta fo r D ecem ber 1945

The N ational Business S ituation
u tp u t at factories and mines increased considerably in
November, and activity continued to expand in most
other lines. Value of retail sales reached new record rates in
November and the early part of December, reflecting in part
further increases in prices.

O

Industrial Production
Output in most industries showed im portant gains in No­
vember, and the Board’s index of industrial production ad­
vanced about 5 per cent. The index, at a level of 171 per
cent of the 1935-39 average, was about the same as in Sep­
tember and in the autum n of 1941. O utput for civilian use in
November, especially of fuels, industrial m aterials, and p ro ­
ducers’ equipment, was larger than in those earlier periods.
Production for civilians of many finished consumer products,
however, like automobiles, radios, clothing, and shoes, while
much higher in November than in September, was still
greatly reduced from 1941 levels.
Steel production showed a large rise during November, and
in the first three weeks of December output was scheduled at
an average rate of 83 per cent of capacity, which was higher
than the November average. Activity at shipyards continued
to decline considerably in November, but increases occurred
in most other metal fabricating industries. Further increases
in O u t p u t were indicated in plants producing electrical pro­
ducts and machinery and in the railro ad equipm ent and
autom obile parts and assembly industries. Automobile pro­
duction, however, was curtailed sharply in the last week of
November and the first half of December by a strike in the
plants of a m ajor producer.
Lumber and glass production wrere at low levels in No­
vember, owing partly to industrial disputes. In the case ot
lumber, however, output in recent months, before the west
coast strikes, was below 1939 levels and one third less than
the rate in 1941.
Production of most nondurable m anufactures and of fuels
increased from October to November, reflecting increased
supplies of m aterials and labor and the end of w^ork stoppages
in the petroleum and coal industries as well as strong demand
generally for these and most other goods for civilian use.
Incomes received by agriculture, business, and consumers
appear to have continued to rise in November as a result of
the widespread increases in production and employment and
further rises in prices and wage rates. Payments to unem­
ployed industrial w orkers and veterans also increased some­
what in November.

Distribution
Departm ent store sales increased sharply in November and
the Board’s seasonally adjusted index rose to a record level
of 228 per cent of the 1935-39 average as com pared with 213
in October. November sales were 11 per cent larger than last
year, and in the first h alf of December sales continued to
show about the same increase. Sales at some other types of
retail stores, especially those selling automotive supplies,
men’s apparel, furniture, building m aterials, and hardware,
have recently shown much larger increases than departm ent
stores, while sales of foods and various other products have
shown somewhat sm aller increases.




Shipments of most classes of railroad revenue freight
showred less decline than is usual in November and the early
part of December and were only 4 per cent below last year’s
high level. Carloadings of agricultural commodities and lessthan-carload m erchandise wrere considerably above last year’s
level.

Employment
Employment in nonagricultural establishm ents rose by over
300,000 workers in November, after allowing for seasonal
changes, reflecting increases in all m ajor lines except Federal
war agencies. A further decline of about 100,000 workers in
m unitions industries was more than offset by gains in em­
ployment in other m anufacturing industries, mostly in recon­
verted metal-products plants. Em ploym ent in the trades and
services, construction, and various other lines showed rel­
atively larger increases than in m anufacturing.

Commodity Prices
W holesale prices of most groups of commodities increased
from the early part of November to the middle of December.
With most farm products at ceiling levels, advances in prices
of these products were sm aller than in September and Oc­
tober. Ceiling prices were raised for newsprint, textile fabrics,
building materials, and various other industrial products, but
a general increase in steel prices wras turned down.

Bank Credit
Loans and investments at banks in 101 leading cities in ­
creased by over seven billion dollars during the six weeks
ended December 12; this period covered the m ajor part of
the Victory Loan Drive.
Government-security holdings increased by 3.7 billion dol­
la r s — a somewhat sm aller rise than had ^occurred in the
three prior drives. Loans for purchasing or carrying Govern­
ment securities rose by 2.5 billion dollars, and at their midDecember levels loans both to brokers and dealers and to
other bank customers slightly exceeded the high points of the
previous drives. Commercial and industrial loans, which had
been expanding since early fall, rose by an additional 800
m illion dollars during the six-week period. The increase in
commercial-credit extension has been at a rate substantially
greater than at any time in recent years.
As payments for security purchases transferred funds from
deposits of businesses and individuals to reserve-exempt warloan accounts, the average level of required reserves at all
member banks declined by around 500 m illion dollars dur­
ing the first half of December. E arly in the month, excess
reserves rose to above 1.5 billion dollars on a weekly average
basis. Subsequently, however, excess reserves declined some­
what as the am ount of war-loan deposits at many banks
reached the maximum lim its and banks turned over to the
Treasury current receipts from sales of Government securities.
Currency outflow has continued at a slackened rate com­
pared with wartime years; money in circulation increased by
close to 350 m illion dollars during the six weeks ended De­
cember 12 compared with over 750 m illion in the 1944
period. On a seasonally adjusted basis, currency outflow has
recently been at the lowest rate since the early p art of 1941.
T

h e

B

oard o f

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o vern o rs