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Atlanta, Georgia Walking the Dog January • 1960 Also in this issue: THE PACE OF G EO R G IA 'S EC O N O M Y DISTRICT BUSINESS HIGHLIGHTS SIXTH DISTRICT STATISTICS SIXTH DISTRICT INDEXES %sem Iknkof 1 T g o e s w i t h o u t s a y i n g that it is a great pleasure, and I deem it a great honor, to speak to you today. I wish to preface my remarks, however, by paying a personal tribute to the Board of Directors of the Nashville Branch of the Federal Reserve Bank of Atlanta for the splendid job they have done in gathering together this distinguished group of businessmen and bankers. At the Federal Reserve Bank, we are proud of the Boards of Directors of all our Branches because of the high sense of responsibility that they bring to their duties. The Nashville Board, however, has gone beyond the call of duty in its effort to enlist the attention of such eminent and influential men as your selves in a consideration of the current position of the American econ omy, but more especially of the role that the Federal Reserve System plays in that economy. It is pleasant, too, to return to East Tennessee after many years’ ab sence and to see all about me evidences of a great industrial expansion and of new and vigorous life in a part of the country that once had its share in bringing upon the South the epithet of “the nation’s number one economic problem.” It must be recognized, of course, that East Tennessee is not alone in this great upward surge of industrialization. The whole nation has been going through a similar development. Ever since the end of World War II, indeed, our country has been washed by wave after wave of prosperity, each one rising higher than the one before. If it were not for the ill effects of the steel strike, we would probably now be experi encing record levels of production and consumption all along the line. Beneath the surface of this prosperity, however, I am sure that we would all confess to having serious problems. These problems usually have to do with money. Indeed, if we were asked about it, I think that most of us would say that there is nothing the matter with us that a little more money wouldn’t cure. I know that is my own case. There are many things I would like to do, and there are some that I really ought to do, but which I cannot do because I haven’t enough money. And what is true of me is true of my city and my state, as it must also be true of yours. The Federal Government itself is hard-pressed to find the money it needs to do all the things that are expected of it. Money is hard to get; if you are lucky enough to get it, you do so only at higher rates of interest than have prevailed for a quarter of a century. Who or what is to blame for this tight money situation? Well, people read the papers and in them they have read about the Federal Re serve’s following a “tight money policy.” Many have, therefore, come to believe that their particular activities and, hence, the operations of the whole economy, are being frustrated by a tight money policy im posed upon us only through the malicious orneriness of the Federal Reserve System. N OTE.— An address by Earle L. Rauber, Vice President and Director of Research, Federal Reserve Bank of Atlanta, before an assembly o f East Tennessee bankers, bank directors, and other businessmen to consider Federal Reserve monetary policy. The meeting was held under the auspices of the Board o f Directors of the Nashville Branch of the Federal Reserve Bank of Atlanta at University Center, University of Tennessee, Knoxville, Tennessee, N ovem ber 12, 1959. Today I want to discuss what I believe to be the real cause of the current monetary stringency, and I am going to intro duce my subject by way of a parable. I shall not apologize for doing so, for a greater Teacher than I once made very effec tive use of parables in driving home essential truths. The parable concerns a neighbor on our street some years ago. This neighbor was a young lady who had once been an animal trainer in a circus. She was tall and strong but had given up her circus career in order to work with a govern ment agency in the city. Still retaining her love of animals, she kept as a pet a huge dog, a boxer, whom she called “Baby.” All day long, while his mistress was away at work, Baby would doze on the enclosed porch, dreaming of all the things that dogs ordinarily dream about. He dreamed of his favorite fire hydrant up the street; and of that sad-eyed, taffycolored cocker spaniel whimpering behind her fence on the other side of the street. How he would love to go over and nuzzle her through the meshes of the fence! And then he thought of that tasty bone he buried a week ago in the neigh bor’s back yard. It must be ripe about now! And then he thought of all those beautiful, shiny, new cars speeding up and down the street. What fun it would be to chase them and make them honk their horns! And so1, Baby’s day would pass in dreaming. In the evening when his mistress had returned from work and had finished supper, she would take Baby out on a leash for a walk. But no sooner did Baby sniff fresh air than all the delightful things he had been dreaming about during the day swam together in his doggy mind in one uncontrollable surge of desire. He lunged mightily against the restraining leash, almost dragging his mistress after him. But she was tall and strong and kept a tight grip on it, so the poor dog’s eyes bugged out; he slavered at the mouth; he panted and groaned, and almost choked himself to death straining against the leash. Now, if you had asked the dog what was the cause of his very evident and acute discomfort, he would have said, “It’s this tight leash. And the person to blame is my mistress at the other end!” If you had asked the dog’s mistress the same question, how ever, you would have got a different answer. She would have told you that the trouble was that the dog was trying to do too many things at once. If he would control himself and walk along at a more gentlemanly pace, he would have a much better chance of achieving all his ends. She could, of course, lengthen the leash, but that would give the dog only momentary relief. He still couldn’t get everything he wanted at the same time. She could even throw the leash away and give the dog his head, as he seemed to want her to do, but even then he couldn’t get everything he wanted at the same time and, in all probability, would get himself killed in the street traffic trying to do so. Now, this is an almost exact analogy of what is happening to this economy of ours. It, too, is a husky beast, employing over sixty-six million persons and turning out nearly four hundred and eighty billions of dollars worth of goods a year. It has also a strong will of its own, for it does not move in response to any central directing agency, but rather in re sponse to the energy generated by the billions of economic decisions of people like yourselves. Underneath these billions of decisions, just what is the economy trying to accomplish? Many things, of course, but there are two especially to which I wish to call attention. For one thing, we are trying to carry through a techno logical revolution of unprecedented scope. We know from history the tremendous effects that have been produced by inventions and technological progress in the past. In the latter decades of the eighteenth century in England, a handful of inventions of quite simfie design revolutionized the newly born cotton industry and then went on to change the whole face of industry, creating the factory system and transferring skill from the craftsman’s hand to the power-driven machine. In the middle of the last century, the application of steam power to transportation on land and sea opened new lands for cultivation, linked the continents of the world together in a world economy, created gigantic new industries like the steel industry, and centralized populations in huge cities. The effects of cheap electric power and of the internal combustion gas engine at the turn of the present century are too evident to need mentioning. They have so completely revolutionized our personal and community ways of living that life without them is almost unthinkable. Today, however, we have on our hands a whole group of technological developments, any one of which would be sufficient to produce incalculable changes in our ways of living. There is nuclear power, for one thing, and jet propul sion. There are solar batteries drawing energy directly from the sun. There is also the imminent possibility of converting heat directly into electricity without the intervention of tur bines and generators. There is the creation through chemistry of materials that nature never heard of—materials tailormade for almost any specific purpose. And in the field of electronics and automation, we now have machines that per form tasks formerly possible only to the human brain, and doing them faster and better. We have no way of knowing what will be the final effects of all these scientific marvels on us as individuals, or as a society. We do know, however, that these changes and develop ments are coming about so rapidly that they are scarcely off the drawing board before they are obsolete. This continuous and rapid revolutionizing of industry necessarily imposes a tremendous drain upon our resources. At a slower pace, an investment in a new machine, a new process, a new industry, might be recovered in large part before it would have to be replaced by something newer still. But today the investment is no sooner made than it must be scrapped for something still newer, if the industry is to keep abreast of the times. The rapidity of technological change, moreover, is being stimulated and complicated today by our unsought and un wanted competition with Soviet Russia in every field, in cluding that of technology. Not only is our economy being driven forward by its own internal forces, but also by the seeming necessity of keeping ahead of Russia in those areas where we presently have the advantage, and of catching up with her in areas where she has now out-distanced us. This competitive factor alone adds tremendously to the cost of our technological revolution, both in terms of ultimate resources and in terms of dollars and cents. The second great task confronting our economy is the necessity of caring for an explosively growing population. The United States is not alone in this. It shares in a world wide population explosion. The world population now stands at something like two and three-quarter billions of people. In 1962, it will be three billion. It will have taken humanity some 250,000 years to achieve that first three billion. But in the year 2000—just about forty years from now—the world • will hold over six and a third billion souls. In other words, the world population will grow more in the next forty years than it did in the previous quarter of a million. Looking at the United States population: In 1950 we had 152 million persons in this country. Today we have over 178 million, and in 1975, as a conservative estimate, the popula tion will be in the neighborhood of 222 million. In the twentyfive years between 1950 and 1975, it will have grown by 70 million. This increase will not be spread evenly over the • 2 • country, if present trends continue, ft is much more likely to be distributed so as to create the maximum of problems. At present, 85 percent of the increase in population is going into the 168 metropolitan areas defined by the Census. If this trend continues, the metropolitan population of this country will grow by some 60 million between 1950 and 1975. Do you have any idea of what this increase means? It means that it will increase by the equivalent of another 1950 New Yorknorthern New Jersey area; another Boston area; another Philadelphia; a Washington; a Baltimore; a Buffalo; a Pitts burgh; a Cleveland; a Chicago; a Detroit; a St. Louis; a Minneapolis-St. Paul; a Los Angeles and a San Francisco area. In addition, there will remain 15 million to be spread among the smaller metropolitan areas. Indeed, if present trends continue, 71 percent of the increase in the metropolitan population will go precisely into the fourteen areas just mentioned. Now, the fact that the increase in our population is going to occur so largely in our metropolitan areas, and especially in the largest ones, is extremely important from an economic point of view. We all know the present difficulties faced by our cities, states, and public utilities in providing essential services to their rapidly growing and migrating populations— streets and roads; housing; water; sewers; schools; fire protec tion; police protection; sanitary facilities; health services; recreation; electric power; gas; telephones. In city after city it is impossible to build schools fast enough to take care of the growing school population and half-day sessions are com mon. If our cities and states are having difficulties now, imagine the magnitude of the physical and financial job they will have to do sixteen years from now to care for the much larger population that is already on the horizon. It is little wonder that state and local indebtedness rose 145 percent from 1950 to 1958—two and a half times as fast as total indebtedness. Dr. George Cline Smith, Vice President and Economist of the F. W. Dodge Corporation, put the problem dramati cally in a recent speech when he said that it will be necessary to build a “second United States” within the next forty years. Every house, every building, every factory, every tool, every machine, every facility of every sort will have to be duplicated by then, besides maintaining those we already have at their present efficiency. Why? For the simple reason that in forty years two persons will be living in this country for every one living here now. The population problem, unfortunately, is being further aggravated by the inordinate stimulation of consumer wants by every medium of persuasion that business can bring to bear on them. Not only does everyone now want everything he sees and hears about on radio and television, but even be fore he earns it, he thinks he deserves it as part of his heritage as an American citizen; and he feels, furthermore, that it is the sacred duty of banks and other lending agencies to imple ment his every whim by the magic of consumer credit. An ex panding population suffering from ballooning wants is bound to create economic problems of the first order. The effort to satisfy all these requirements simultaneously— those of industry to keep abreast of the technological revolu tion; of cities and states to care for their growing populations; of Government to maintain its expanding domestic programs and to meet Russian competition; and of growing millions of individuals clamoring for higher and higher levels of living with less and less work—this effort is now making, and for years to come will continue to make, nearly impossible de mands upon the available supply of physical resources. It is doubtful, indeed, if we can do all these things at the same time—anymore than the dog could get everything he wanted at the same time. Because: Although population can double in forty years (our young people can see to that!) our re sources cannot double in the same time. This is our funda mental problem—a scarcity of real resources vis-a-vis the demands we are making on them to do all the things we as a society want to do. It is a problem, however, that more money cannot solve. It is true, of course, that for any individual, for any partic ular business, or city, or state more money would enable it to attract to itself a larger share of our scarce resources and would thereby solve its particular problem—albeit at the ex pense of other segments of the economy. But this solution cannot be generalized for the simple reason that more money would not increase the total supply of physical resources. If more money were really the answer to our problem, it would be easy enough for the Federal Reserve to increase the money supply and thus assure perpetual prosperity. But that would be just like throwing away the leash on the dog. What would happen? History is strewn with the wreckage created in country after country by ill-fated attempts to evade through the magic of inflated currencies the restraints imposed upon men by real economic scarcities. The classic example of this sort of thing is the inflation that raged in Germany after the First World War, from some time in 1922 up until sometime in 1924. I have before me two pieces of German currency that illustrate the course of this inflation. The first piece is a five mark note issued in August 1917, when the war was three-quarters over. This piece of money is made of good tough paper. It is highly engraved on both sides, and at par would have been worth about a dollar and a quarter, but in August 1917 was worth much less—perhaps seventy-five or eighty cents. The second piece of German money was issued in October 1923. It is smaller in size; it is made of flimsy paper, almost like tissue paper; it is not engraved but is merely overprinted and only on one side at that. The other side is blank. This piece of currency, on which it did not pay to print the reverse side, carries the denomination five billion marks. But even such an astronomical sum would scarcely buy a paper of matches like those the hotel left on my night table. And what was the result of this incredible depreciation of the currency? I had the privilege in 1929 of studying at a German university on a traveling fellowship from my Ameri can university. While there I made the acquaintance of an old professor who should have retired years before. He had, in deed, planned on retiring and to that end had been saving throughout most of his working life to buy an endowment insurance policy in the amount of about 100,000 marks. On the income from this, he and his wife might have enjoyed a frugal but respectable living in their old age. Unfortunately, this policy fell due at the height of the in flation. By that time the mark had so deteriorated in value that the insurance company could not afford to use a stamp to mail the 100,000 marks to the old man. He had to stop by the office and pick it up in person—and his whole life’s savings would then buy only one cigarette. This gentleman, of course, was not alone. Thousands upon thousands were suffering the same fate. The whole middle class of Germany, indeed, was robbed, impoverished, de moralized, and destroyed by the inflation. And it was precisely in the confused and bewildered wreckage of the middle classes that Hitler found the material out of which to make a revolu tion and to create a power structure that later let loose upon the world the greatest blood bath in all history. And all those white crosses in American military cemeteries around the world are, therefore, among the tragic sequelae of a mistaken monetary policy followed by a distant nation across the sea. Continued on Page 6 • 3 • Most measures of Georgia’s economy indicate that 1959 was a banner year for the ‘‘Empire State of the South.” Recession-born downtrends gave way to renewed pros perity, and many indicators rose to record peaks. Employment, Spending, and Saving Rise Seasonally adjusted nonfarm employment passed the pre-recession high in November 1958, and has risen steadily since. Responding to high employment, Georgians spent record amounts last year. Tax receipts indicate that retail sales for the year ended September 1959 were more than 10 percent ahead of the comparable preceding year. Taxable sales of manufactures and public utilities rose even more. Debits to demand deposit accounts, a measure of spending for business and personal use, as well as a gauge of the volume of financial transactions, were 13 percent higher in the first eleven months of 1959 than in that period of 1958 at banks in 16 Georgia cities. Employment, Georgia The Pace of C facturing employment has risen steadily, so that by October 1959 it was at the same level reached in mid summer of 1957 and only 5 percent below the all-time peak of June 1955. The decline in November 1959 was due to a cutback in automobile manufacturing employ ment, a direct result of the steel strike. During the first eleven months of 1959, factory employment averaged 3.7 percent higher than in the same period a year earlier. Even more impressive than the upturn in factory jobs has been the increase in man-hours, or the number of employees on the job multiplied by the average number of hours worked each week. Since the 7.7 percent increase in man-hours in the first eleven months of 1959 was greater than the rise in factory employment, it is apparent that the average worker put in a longer workweek, and consequently enjoyed a fatter pay check. 1955-59 Changes in Manufacturing Employment And Man-hours W orked G eo rgia, 1959 from 1958 In addition to spending more, Georgians were able to add to their savings during 1959. Sales of ordinary life insurance policies in the January - October period ex ceeded the year-earlier volume 16 percent. Between October 1958 and October 1959, outstanding shares at savings and loan associations rose 10 percent, and time deposits at member banks increased 6 percent. The increased economic activity in Georgia has been stronger in some sectors of the economy than in others, as would be expected. Georgia farmers have been plagued by lower prices for their products. Cash receipts from farm marketings during the firsj three quarters of 1959 were 2.5 percent below the comparable period in 1958, which, it must be remembered, was a record year. The decline was centered in livestock production, and particu larly in the important broiler industry of North Georgia. Manufacturing a Stimulus If one major reason for the current high level of economic activity were to be singled out, it would be the turnabout in manufacturing. As the chart indicates, factory jobs in Georgia declined gradually from the end of 1955 to the middle of 1957, then dropped rather sharp ly until the spring of 1958. Since factory employment provides almost one-third of Georgia’s nonfarm jobs, the effects of the decline on total employment were great. Gains in trade, service, government, and other types of jobs did not offset the drop in manufacturing. Since May 1958, however, seasonally adjusted manu Within manufacturing, only food processors employed fewer workers in the average 1959 month than in 1958. Man-hours worked increased in all industry groups except food, and in each case the gain was greater than that in employment. The most dramatic upturn was in transporta- < tion equipment, which employed about 15 percent more people in 1959 than in 1958. Textiles Strong The highlight of the manufacturing upturn has been the new strength evidenced by the textile industry. Over 400 concerns employ 100,000 people in about 125 • 4 • 'gia’s Economy Georgia communities in the production of cotton broad cloth, woolens, upholstery, thread, tire cord, tufted goods, and other textile products. Besides providing al most one-third of the state’s manufacturing employment, textile mill production is apparently the most widespread industry in Georgia. The fortunes of over one-fourth of the Peach State’s communities depend to some extent on the ups and downs of textile manufacturing. Textile mill employment recently has enjoyed its most sustained upturn in several years. With the excep tion of one or two months of normal seasonal cutbacks, jobs have increased steadily for fifteen months. This is in marked contrast to the downward trend in the number of persons employed in textile mill production that began in 1951. From March 1951 until mid-1958, Georgia textile mill employment fell from 115,000 to 94,000. Banking figures and sales tax receipts indicate that the rate of improvement in economic conditions has been greater in textile communities than in other areas of Georgia. An outstanding example of this is the North Georgia area specializing in tufted textile products, cen tered in Dalton and Calhoun. Employment in the Dalton area is at the highest level since World War II. Bank deposits in the two cities have risen over 20 percent in the past year, and loans have jumped 25 percent. Sales tax receipts in the twelve months ended September 30 were 17 percent above a year earlier in the two counties in which these cities are located, compared with an 11-percent gain in the state. Percent increase. + 5 1959 from 1958 + 10 +15 Nontex,lle Bank L o a n s 1 Textile B a n k D e p o s it s1 | | 1 i Ban k D e b it s2 Additional Aids S a le s Tax R e c e ip t s3 m ___________________________I H l3 July 1959 from W W i i i i i l i i i ii i____li____Ii____Ii____ jfi f I9M i l " ‘ For the state as a whole, however, the rate of gain in textile mill employment has not been as impressive, at least on the surface, as the rates of increase in other types of manufacturing. Between the July 1958 low point and November 1959, textile mill jobs increased by slightly over 6 percent, compared with a 7-percent gain for all industries. During the first eleven months of 1959, average textile mill employment was only 2.3 percent ahead of the same 1958 period, whereas the gain in total manufac turing jobs averaged almost 4 percent. Not all of the recent upturn in textile mill activity is reflected in employment figures. Mill operators have expanded their operations to some extent by having their employees work longer hours. During the first eleven months of 1959, Georgia textile mill workers put in an average of 41 hours per week; in the comparable 1958 period the workweek averaged 38.2 hours. Production has increased at an even greater rate than man-hours worked as is evidenced by increased cotton consumption. Since almost 90 percent of Georgia’s textile mill employees work in plants that use cotton as their principal raw material, cotton consumption figures provide a highly reliable indicator of textile activity. For January-October 1959, Georgians used slightly over 1,400,000 bales of cotton, mostly for textile production. This represents an increase of 15.6 percent over the same period in 1958, a gain of 4.0 percent over the first ten months of 1957, and a slight decline from the 1955 and 1956 ten-month totals. The pickup in Georgia’s textile mill activity reflects a general upturn in textile activity in the nation. Seasonally adjusted textile mill production in the United States rose from 91 percent of the 1947-49 average in February 1958 to 120 percent in September 1959. The July 1959 index of 123 was the highest on record, exceeding the previous peak, reached in December 1950, by over 3 percent. Textile mill employment in the nation averaged better than 3 percent above a year earlier during most of 1959. The increased demand for Georgia’s textile mill prod ucts comes primarily from two sources: tire manufac turers and apparel producers. Several of the state’s largest textile mills are engaged in the manufacture of tire cord. These plants have benefited by the recent upsurge in automobile production and the resulting increase in tire consumption. Since most of Georgia’s mill products are used in the manufacture of apparel, however, develop ments in that industry are of prime importance. Apparel production in the nation during the first three quarters of 1959 exceeded the year-earlier level 15 percent. Although production data are not available for individual states, employment figures indicate that Georgia’s apparel indus try is growing at a greater rate than the nation’s. Over 2,200 jobs were created by new and expanded apparel plants in the year ended June 30. New plants provide a growing market for Georgia’s textile mill products. Many other factors were at work to bring about the upturn in Georgia’s business. Near-record building of homes, office buildings, retail stores, and other structures pushed the value of construction contracts awarded during the first ten months 13 percent ahead of the same period in 1958. New businesses were started at a rate well above that of 1958, and industrial development continued, with an estimated investment of $60 million in major new and expanded plants during the first three quarters of 1959. Government activities in Georgia have been stepped up at both the state and Federal levels, providing an average of 5,000 additional jobs during the first eleven months of 1959. An expanding population has created new jobs in service industries, communications and at financial institutions. R o bert M. Y oung • 5 • Continued from Page 3 Please do not misunderstand me. I am not saying that in this country we are in any immediate or even remote danger of following the example of Germany. I am saying, however, that, except for whatever prudence the public can muster, the hand of the Federal Reserve on the monetary leash is just about the only thing holding back the economy from plung ing headlong in the direction of such disaster. In this task we want your understanding. More than that, however, we want and need your support and cooperation, even though at times it may involve some sacrifice for you to give it. Walking the dog is not always an easy task. And restrain ing an economy as hefty and as headstrong as ours from doing itself harm is also not an easy task. If you are ever in clined to pray about such matters, you had better pray that the Federal Reserve keep a tight grip on the monetary leash and not connive with those who would seek for an easy and popular escape from economic and monetary troubles by throwing it away. Debits to Individual Demand Deposit Accounts (In Thousands of Dollars) Bank Announcements On December 14, 1958, the newly organized Citizens Na tional Bank of Sandy Springs, Sandy Springs, Georgia, opened for business as a member of the Federal Reserve System. Officers are A. J. Weinberg, Chairman of the Board; Thomas E. Cook, President; Ivan Allen, Jr., Vice Presi dent; and James S. Farr, Cashier. Capital totals $125,000 and surplus and other funds $175,000. On January 1, 1960, the Red Boiling Springs Bank, Red Boiling Springs, Tennessee, a nonmember bank, began to remit at par for checks drawn on it when received from the Federal Reserve Bank. Officers are Dayton Chitwood, President; Dr. C. C. Chitwood, Jr., Vice President; William B. Green, Cashier; and Miss Georgia Patterson, Assistant Cashier. Capital totals $25,000 and surplus and undivided profits $88,478. Department Store Sales and Inventories * Percent Change Place Sales Nov. 1959 from Oct. Nov. 1959 1958 11 Months 1959 from 1958 Inventories Nov. 30, 1959 from Nov. 30, Oct. 31, 1958 1959 +4 +2 +4 —4 +2 +6 +7 +4 + 13 —3 ALABAMA ......................... Birmingham.................... M obile.............................. Montgomery.................... —1 +7 —3 —4 FLO RID A .............................. Daytona Beach . . . . Jacksonville.................... Miami A r e a .................... M ia m i......................... O r la n d o ......................... St. Ptrsbg-Tampa Area . +3 +3 —0 —1 +1 —5 + 14 +3 +0 —2 +6 + 18 +4 + 34 + 16 + 15 +8 + 22 GEORGIA.............................. Atlanta** .................... A u g u s t a ......................... Columbus......................... M acon .............................. +8 +11 +0 —0 +2 — 10 +4 + 10 + 11 + 19 +4 +3 +4 +5 +5 +2 +5 +5 + 13 +7 + 21 +9 +7 + 11 + 19 +6 +6 + 16 +0 +4 + 16 —0 +4 —3 +7 +4 +1 +6 M e rid ia n * * .................... +8 +9 + 11 —2 +5 —9 +4 +3 +6 +8 +8 +6 .................... TENNESSEE Bristol-KingsportJohnson City** . . . Bristol (Tenn. & Va.)** Chattanooga.................... K noxville......................... D I S T R I C T ......................... +1 +5 +7 + 6 +7 —2 +1 +0 —1 +4 —1 —9 +2 +8 +9 +3 —1 +8 +9 +8 +4 +5 —1 — 11 +5 +3 + 17 +8 Savannah ......................... LO U ISIA N A......................... Baton Rouge .................... New O rle an s.................... M I S S I S S I P P I .................... —2 + 23 +2 +1 + 17 + 22 +4 +3 +6 +8 +2 +6 +1 +2 +1 +3 +2 +5 +9 + 11 ♦Reporting stores account for over 90 percent of total District department store sales. **In order to permit publication of figures for this city, a special sample has been constructed that is not confined exclusively to department stores. Figures for nondepartment stores, however, are not used in computing the District percent changes. ALABAMA Anniston . . . . Birmingham . . . Dothan . . . . Gadsden . . . . Huntsville* . . . Mobile . . . . Montgomery . . . Selma* . . Tuscaloosa* . . . Total Reporting Cities Other Citiesf . . . FLORIDA Daytona Beach* Fort Lauderdale* . Gainesville* . . . Jacksonville . . . Key West* . . . Lakeland* . . . Percent Change Year-to-date 11 Months Nov. 1959 from iqcjq Oct. Nov. from 1959 1958 1958 Nov. 1959 Oct. 1959 Nov. 1958 40,159 709,483 30,982 33,493 67,487 281,726 162,291 25,426 50,337 1,401.384 752,508 44,206 779,870 35,772 35,830 79,807 283,487 174,889 32,254 64,346 1,530,461 806,432 36,091 733,771 30,956 37,139 64,395 248,6% 151,880 23,364 44,610 1,370,902 656,914 —9 —9 — 13 —7 — 15 —1 —7 — 21 — 22 —8 —7 + 11 —3 +0 — 10 +5 + 13 +7 + 13 +2 + 15 + 15 + 11 +9 + 11 + 19 +12 + 14 + 12 +14 + 12 + 15 56,701 199,581 40,139 761,621 16,939 73,221 877,631 1,267,291 232,110 81,698 222,582 400,326 132,418 3,484,627 1,684,193 55,643 199,229 43,077 780,499 15,298 76,301 850,666 1,239,983 249,446 86,708 218,787 394,672 125,833 3,485,476 1,696,747 51,751 180,993 33,710 641,224 13,744 68,629 726,037 1,088,916 187,826 76,957 184,464 350,989 113,003 2,992,206 1,324,191 +2 +0 —7 —2 + 11 —4 +3 +2 —7 —6 +2 + 1 +5 —0 —1 + 10 + 10 + 19 + 19 + 23 +7 + 21 + 16 + 24 +6 + 21 + 14 + 17 + 16 + 27 +8 + 10 + 14 + 12 + 11 +14 + 16 + 14 + 28 + 10 + 20 + 17 + 13 + 15 + 17 —5 —4 —9 —7 —7 —2 —8 — 14 — 10 — 13 —5 — 14 — 22 —1 —8 — 10 —8 —3 + 20 + 17 +9 + 13 + 28 + 14 + 11 — 13 + 14 —1 + 10 + 16 —4 + 27 +4 +15 + 10 + 20 + 16 +8 + 13 +9 + 25 +9 +6 —3 + 14 + 10 + 14 + 21 + 13 + 17 + 11 + 27 + 13 + 16 —9 —8 — 16 —7 —8 —9 —8 —1 +10 —3 —4 + 12 +9 —1 +7 +10 + 14 +4 +8 +8 +11 —1 — 12 — 10 —6 —0 —2 —2 —7 —3 +16 +8 +9 +9 +17 +8 + 16 + 10 +7 + 17 + 13 + 19 + 17 + 17 + 12 +8 + 17 + 14 —4 —3 — 12 —5 —2 +2 —1 —0 —4 —5 —3 —5 +3 + 12 +2 + 15 + 15 + 15 + 13 + 1 + 12 + 11 +15 + 12 + 12 + 17 +7 + 15 + 11 + 14 + 14 + 14 +13 +13 +15 +13 —6 + 19 +10 Greater Miami* Orlando . . . . Pensacola . . . St. Petersburg . . Tampa . . . . West Palm Beach* Total Reporting Cities Other Citiesf . . . GEORGIA Albany . . . . 52,332 55,084 43,686 Athens* . . . . 38,372 40,071 32,775 Atlanta . . . . 1,899,634 2,080,123 1,737,985 Augusta . . . . 102,479 109,762 90,775 Brunswick . . . 24,498 26,255 19,175 Columbus . . . . 102,526 104,884 89,601 Elberton . . . . 9,078 9,857 8,153 Gainesville* . . . 46,886 40,383 46,593 Griffin* . . . . 20,% 2 18,906 16,624 LaGrange* . . . 18,271 20,937 18,507 Macon . . . . 118,771 124,828 108,226 Marietta* . . . 29,754 34,593 25,687 17,142 Newnan . . . . 21,991 17,939 Rome* . . . . 51,386 50,655 39,741 182,484 Savannah . . . . 198,737 175,485 34,797 Valdosta . . . . 31,419 27,257 Total Reporting Cities 2,736,704 2,981,153 2,498,209 959,971 Other Citiesf . . . 986,416 798,739 LOUISIANA 69,159 75,687 69,533 Alexandria* . . . 253,994 Baton Rouge . . 275,626 230,729 Lafayette* . . . 59,304 70,490 61,288 84,792 Lake Charles . . 79,029 82,671 New Orleans . . . 1,223,266 1,335,245 1,096,182 1,684,752 Total Reporting Cities 1,841,840 1,540,403 556,497 Other Citiesf . . . 607,340 562,999 MISSISSIPPI Biloxi-Gulfport* . 48,316 48,676 41,630 Hattiesburg . . . 33,538 37,973 31,004 284,764 Jackson . . . . 314,724 261,589 Laurel* . . . . 27,335 28,959 25,041 Meridian . . . . 44,729 44,845 38,147 23,234 Natchez* . . . . 22,660 21,044 21,247 Vicksburg . . . 20,896 18,031 482,238 519,658 Total Reporting Cities 436,486 251,302 Other Citiesf . . . 235,214 258,485 TENNESSEE 41,944 Bristol* . . . . 43,680 40,730 308,660 317,361 275,227 Chattanooga . . . 38,592 Johnson City* . . 43,832 38,017 80,596 84,646 Kingsport* . . . 70,048 238,192 232,623 Knoxville . . . 201,786 Nashville . . . . 753,619 739,461 657,977 1,456,034 1,467,172 Total Reporting Cities 1,283,785 Other Citiesf . . . 543,511 543,789 539,852 15,993,721 16,724,969 14,239,900 SIXTH DISTRICT . Reporting Cities 11,245,739 11,825,760 10,121,991 4,747,982 Other Citiesf . . 4,899,209 4,117,909 9,609,583 10,110,616 Total, 32 Cities . . 8,617,655 UNITED STATES 344 Cities . . . 217,167,000 230,245,000 183,092,000 *Nct included in total for 32 cities that are part of the National Bank Debit Series. fEstimated. •6 • S ix th D is tr ic t In d e x e s Seasonally Adjusted (1947-49 - 100) 1958 1959 SIXTH DISTRICT OCT. NOV. DEC. j JAN. FEB. MAR. APR. JUNE JULY AUG. SEPT. OCT. NOV. Nonfarm Employment 136 118 169 127 179 113 80 159 94 86 207r 199 88 314 137 119 170 128 178 112 80 159 90 86 215r 204 87 316 136 118 172 129 179 112 79 160 92 86 211r 205 84 330 137 119 173 132 182 113 79 160 91 86 212r 204 91 351 137 120 174 132 178 114 80 161 92 87 212r 206 92 346 138 121 174 133 179 115 78 161 95 88 208r 209 93 341 138 121 176 135 180 115 79 161 98 87 214r 214 94 340 139 122 179 135 181 113 80 163 100 88 212r 215 92 346 139 123 182 135 182 114 79 163 103 88 202r 219 89 357 139 123 186 135 181 112 80 165 102 89 207r 224 110 359 139 120 185 136 175 112 79 163 73 88 206r 216 94 359 139 120 185 131 177 113 81 165 74 88 203r 213 93 351 139 120 186r 130 173 115 81 164r 74 87 209r 210r 93 350 140 121 186 131 174 116 81 161 94 86 183 213 91 n.a. 190 364 433 308 112 84 217 166 154 180 131 152 111 135 146 153 258 144 209 202 145 175 285 250 142 149 105 190 333 375 298 123 99 216 172r 161 214 129 164r 126 136 155 158 232r 144 213 r 207 152 180 291 243 139 146 102 201 309 367 262 130 92 211 176 162 204 138 156 124 142 163 158 256 148 212 205 148 179 292 273 150 161 121 192 336 364 314 141 128 162 174 164 195 136 162 124 143 161 161 242 145 207 200 161 181 298 265 144 153 114 193 445 382 496 134 113 164 168 161 180 127 154 116 141 154 155 248 139 203 198 154 178 303 271 153 162 121 189 463 394 520 142 105 185 167 155 171 127 148 104 136 147 143 251 130 221 195 141 179 305 273 149 160 118 198 453 398 499 150 127 183 175 169 190 135 148 111 130 151 170 263 142 230 201 157 178 311 274 145 164 112 206 397 429 370 151 131 181 182 161 187 135 164 121 135 153 166 269 144 251 200 153 182 316 262 158 174 126 200 411 433 393 151 112 192 186 174 192 127 161 114 139 148 168 277 151 245 202 148 183 321 280 152 174 117 195 416 425 410 151 117 190 190 178 179 136 168 124 138 164 167 301 155 244 212 158 181 329 285 162 179 124 203 440 444 436 124 95 182 196 188 190 145 164 131 221 165 177 312 156 263 217 159 183 330 260 154 174 115 207r 380 440 331 135 124 194 180 169 168 131 155 111 166 165 158 277 151 241 222 147 183 331 283 150 164 118 215r 350 441 276 114 94 182 178r 169 185 r 124 160 113r 151 r 159 158 274 149 241 r 225 156 182 331 273 147 153 109 218 n.a. n.a. n.a. n.a. n.a. n.a. 187p 178 209p 129 168 130p 182 168 162 269 154p 260p 223p 161p 184 333 273 150 160 109 120 104 182 135 153 239 106 221 120 104 186 134r 158 246 101 216 120 105 179 131 155 242 111 232 121 105 182 147 155 248 126 233 120 106 185 154 154 254 123 233 121 107 189 125 154 250 147 233 120 107 193 145 156 254 148 238 121 107 190 135 157 259 132 231 121 106 195 134 160 266 162 253 122 109 198 139 160 275 164 254 117 100 173 143 160 269 127 226 117 99 167 139 160 270 134 248 117 97r 168r 138 159 272 84 241 121 105 183 134 159 273 n.a. 229 188 187 326 153 235 463 162 388 188 186 322 180r 241 477 147 357 187 186 316 167 241 477 162 403 188 188 318 176 242 485 281 372 189 190 326 184 238 492 232 382 191 193 319 163 235 500 182 391 193 195 343 183 233 511 230 389 195 195 351 176 241 526 227 400 197 198 351 175 243 534 236 437 199 202 364 178 238 544 239 441 199 202 371 212 246 548 200 408 200 202 370 177 247 550 212 450 200 202 371 180 245 547 172 436 200 201 368 203p 245 547 n.a. 428 130 115 190 150r 154 223 104 224 130 116 201 144r 158 226 124 218 130 116 200 153 158 227 153 243 131 115 195 149 159 230 143 236 131 116 197 143 157 237 142 238 131 117 204 134 157 235 169 243 132 118 206 151 157 244 150 248 132 119 211 148 160 246 158 235 132 119 215 139 159 250 140 253 134 120 219 159 157 256 178 261 133 119 216 163 162 260 131 238 134 120 207 144 160 260 172 258 134 120r 210r 159r 160 261 97 249 134 117 202 157p 163 266 n.a. 244 128 96 165 157 152 268 99 215 128 98 172 175 r 156 277 114 199 129 97 169 196 159 274 109 230 129 96 173 171 163 284 103 210 129 95 173 174 160 287 112 216 128 96 175 203 165 293 130 227 128 96 178 177 160 293 123 229 128 96 179 191 165 295 159 217 128 96 175 177 165 295 146 240 127 96 176 193 160 302 142 233 126 95 176 168 160 299 86 223 127 95 178 181 160 304 91 248 126r 96 170r 161 157 307 139 226 127 95 173 184 160 309 n.a. 212 130 132 247 80 197 359 94r 211 131 133 248 107 198 363 120r 214 130 132 245 133 195 369 125r 233 132 131 247 114 197 361 lOOr 216 131 131 246 106 190 367 103r 210 131 131 251 97 198 378 llO r 225 130 132 250 114 195 383 llO r 225 132 134 247 120 191 391 106r 208 131 133 247 132 195 398 lllr 238 131 134 252 115 197 403 112r 233 131 134 253 129 194 400 106r 224 133 135 253 95 195 411 140r 236 133 135 241 83 202 392 127 230 133 136 244 117 204 392 n.a. 233 120 116 187 109 159 251 114 220 120 116 187 113r 161 251 114 213 120 116 196 113 162 256 100 235 120 117 202 111 165 262 98 230 121 118 204 114 160 267 107 242 122 119 205 109 159 268 119 229 123 119 208 114 162 272 109 229 122 119 206 116 166 276 95 225 123 120 206 116 164 283 113 235 122 121 211 105 165 287 87 239 122 119 214 122 165 287 108 221 122 120 211 109 166 288 105 229 122 119 206r 108r 167 293 109 225 121 119 208 103 167 291 n.a. 234 Fabricated Metals . . . Food .............................. Lbr., Wood Prod., Fur. & Fix. Paper & Allied Products Primary Metals . . . . T e x tile s.............................. Transportation Equipment*** Manufacturing Payrolls . . . Cotton Consumption** . . . Electric Power Production** . Petrol. Prod, in Coastal Louisiana & Mississippi** . All Other . . . Farm Cash Receipts . Crops .................... Livestock . . . Dept. Store Sales*/** Jacksonville Knoxville Miami . . New Orleans Furniture Store Sales*/** Turnover of Demand Deposits* ALABAMA Nonfarm Employment . . Manufacturing Employment Member Bank Deposits FLORIDA Nonfarm Employment . . Manufacturing Employment GEORGIA Nonfarm Employment . . Manufacturing Employment Member Bank Deposits . . Member Bank Loans . . . Farm Cash Receipts . . . Bank D e b i t s .................... LOUISIANA Nonfarm Employment . . Manufacturing Employment Manufacturing Payrolls . . Furniture Store Sales* . . Member Bank Deposits* Member Bank Loans* . . MISSISSIPPI Nonfarm Employment . . Manufacturing Employment Manufacturing Payrolls . . Furniture Store Sales* . . Member Bank Deposits* TENNESSEE Nonfarm Employment . . Manufacturing Employment Member Bank Deposits* Member Bank Loans* *For Sixth District area only. Other totals for entire six states. ♦♦Daily average basis. ***Revisions reflect new seasonal factors. n.a. Not Available. p Preliminary. MAY r Revised. Sources: Nonfarm and mfg. emp. and payrolls, state depts. of labor; cotton consumption, U. S. Bureau Census; construction contracts, F. W. Dodge Corp.; petrol, prod., U. S. Bureau of Mines; elec. power prod., Fed. Power Comm. Other indexes based on data collected by this Bank. All indexes calculated by this Bank. •7 • SIXTH DISTRICT BUSINESS HIGHLIGHTS ^ N ^ o s t e c o n o m i c i n d i c a t o r s have shown som e im provem ent recently. N onfarm em ploym ent edged upward to a new record and factory payrolls increased, reflecting largely the return of steelw orkers to their jobs in early N ovem ber. Consum er spending has im proved, but is still slightly below the sum m er peak. Total farm output increased som ew hat but average prices received by farmers m oved slightly lower. Loans at m em ber banks rose further, and deposits strengthened som ewhat. Borrowings from the Federal R eserve Bank of A tlanta reached a new high. Nonfarm em ploym ent, seasonally adjusted, rose slightly in November following six months of virtually no change. The improvement, which brought a new record, reflected largely a sharp rise in Alabama, where the return of steelworkers to their jobs brought total employment close to its pre-strike level. Depressing effects of the long steel strike persisted in Georgia, where layoffs in the automobile industry caused by steel shortages almost offset gains in nonmanufacturing activities and held total employment at the previous month’s level. In early December, automobile workers were recalled to their jobs as steel supplies increased sufficiently to allow resumption of output. Factory payrolls for District states as a group rose slightly, reflecting a gain in manufacturing employment. Construction activity, as measured by seasonally adjusted construction em ploym ent, held steady in November, following declines from last summer’s record level. However, the three-month average of construction contract aw ard s, which includes data for November and gives a clue to construction activity in the near future, declined further. Cotton consumption, an indicator of textile activity, declined slightly in November. Crude oil production in Coastal Louisiana and Mississippi continued in near-record volume. With the re-opening of steel mills in early November, steel output rebounded sharply, but in mid-December was still somewhat below the pre-strike volume. Retail sales have almost regained summer peaks. Preliminary estimates for December indicate that seasonally adjusted departm ent store sales increased after a strong rise in November, when increases occurred in every major metropolitan area except Miami. Furniture store sales also increased more than seasonally in November. Automobile sales were strong in October, but probably declined in November because of low output of new models. Consumer instalment credit outstanding continued to mount in November, although at a slower rate than in other recent months. Consumer saving edged up in November. Seasonally adjusted bank debits, an indi cator of check transactions of all types, did not change. Weather favored farmers in most areas but a cold snap in Florida curtailed marketings of fresh vegetables there. Total farm m arketings increased slightly, however, as farmers shipped more hogs, cattle, citrus, and sugar cane. A verage prices for farm products shaded lower, but prices for broilers were a notable exception. Farm w ag e rates held at year earlier levels; total farm em ploym ent, however, was less than that a year ago. Loans and deposits at mem ber banks rose moderately in November after seasonal adjustment, and preliminary data show a further rise in December. Louisiana was the only state to show significant gains in loans in November; Georgia and Louisiana accounted for most of the increase in deposits. Investments, mostly U. S. Government securities, resumed their downward trend in November, following an increase in October. Borrowings from the Federal Reserve Bank of Atlanta rose to new records during early December, but fell again during the two weeks before Christmas.
@FedFRASER