The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
MONTHLY REVIEW fy M ti FED ERA L R ESER V E BANK M ARCH 1970 OF A T LA I n t e r n a t i o n a l L e n d in g A g e n c i e s : I n s t r u m e n t s f o r E c o n o m ic D e v e lo p m e n t S in c e th e fin a n c ia l end of a g e n c ie s W o r ld have W ar II, in te r n a tio n a l 1914. th e ir expanded S y s t e m , c o o r d in a t io n o f m o n e ta r y p o lic y a m o n g r o le in D e s p it e th e d e c e n tr a liz e d n a tu r e o f th e w o r ld e c o n o m ic a ffa ir s . B e c a u s e o f t h e n u m e r o u s th e liq u id it y a n d e x c h a n g e c r is e s o f t h e la s t d e c a d e , B oard th o se n e c e s s a r y to p r e v e n t t h e in d iv id u a l p a r ts o f th e a g e n c ie s te r n a tio n a l o c c u p ie d th e n a tio n a l th e p r im a r ily m oney fo r in v o lv e d w ith p a y m e n ts Fund and, In te r n a tio n a l to th e in sy ste m have th e In ter so m e e x te n t, s p o tlig h t— e s p e c ia lly M o n eta ry B ank and S e ttle m e n ts . O th e r in te r n a tio n a l a n d r e g io n a l in s t itu t io n s c o n c e r n e d m a in ly w ith lo n g e r - te r m tw e lv e of S y stem F ederal R eserve B anks and th e d e v e lo p e d . G overnors so o n T h is w as fr o m w o r k in g a t c r o s s p u r p o s e s in in f lu e n c in g fin a n c ia l a n d e c o n o m ic a c t iv ity . T h is c o o r d in a tio n O pen g r a d u a lly M arket e v o lv e d C o m m itte e , in to w h ic h th e F ederal w as le g a lly fo r m a liz e d b y th e B a n k in g A c t o f 1 9 3 5 . S im ila r ly , f in a n c in g o f e c o n o m ic in th e in te r n a tio n a l sp h ere, th e d e v e lo p m e n t h a v e a ls o e x t e n d e d th e ir r o le in th e w r e n c h in g e f f e c t s o f tw o w o r ld w a r s a n d a s e v e r e , w o r ld e c o n o m y . T h e s e in s t it u t io n s h a v e r e c e iv e d w o r ld w id e e c o n o m ic d e p r e s s io n o n in te r n a tio n a l le s s a t t e n t io n in m o s t a d v a n c e d in d u s tr ia l c o u n tra d e p a y m e n ts tr ie s . T h i s a r t ic le f o c u s e s o n in te r n a tio n a l m o n e ta r y s ta b iliz e w o r ld th e g e n e r a l n a tu r e o f th e m o s t im p o r ta n t o f t h e s e le n d in g in s titu and th e m e m b e r s h ip le d to th e c r e a tio n in s t itu t io n p a y m e n ts in c lu d e s in sy ste m . m o st of 1944 an to B eca u se tio n s a n d o n t h e m a jo r d iffe r e n c e s in th e ir a c t iv i its tie s . f r e e w o r ld , t h is i n s t it u t io n h a s p la y e d a k e y r o le n a tio n s of th e in t h e o p e r a t io n o f t h is s y s t e m . R a tio n ale for Len d in g In stitu tio n s O u ts id e th e fr a m e w o r k o f th e I M F , r e p r e s e n ta T h e e v o lu t io n o f th e in s t itu t io n a l fr a m e w o r k o f t iv e s o f c e n tr a l b a n k s in m a jo r fin a n c ia l c o u n tr ie s th e in te r n a tio n a l fin a n c ia l s y s t e m have in its d e v e lo p m e n t fin a n c ia l years of th e h a s p a r a lle le d e v o lu t io n sy ste m . W ith in p e r io d ic fin a n c ia l th e of th e U n ite d c r is e s le d U. S. S ta te s, to e s ta b lis h m e n t o f th e F e d e r a l R e s e r v e S y s te m th e in a ls o been a u s p ic e s o f th e m e e t in g B ank m o n th ly fo r under In te r n a tio n a l th e S e ttle m e n ts . H e r e , t h e y h a v e m u tu a lly d is c u s s e d a n d , to a d e g r e e , c o o r d in a te d o p e r a tio n s h a v e b e e n p o lic y . lim ite d H ow ever, jo in t to s p e c ia l c ir c u m s t a n c e s s u c h a s t h e v a r io u s s t e r lin g c r e d it p a c k M o n th ly R eview , Vol. L V , No. 3. Free subscription and additional copies available upon request to the Research Departm ent, Federal Reserve B a n k of Atlanta, Atlanta, G eorgia 30303. 38 a g e s d e s ig n e d to s u p p o r t t h e B r it is h pound. F o llo w in g th e c r e a tio n o f t h e F e d e r a l R e s e r v e S y s t e m , it w a s r e c o g n iz e d t h a t e v e n w ith a s t a b le M O N TH LY R E V IE W m o n e ta r y a n d c r e d it s y s t e m , c r e d it m a y n o t a l te r n a tio n a l B a n k fo r R e c o n s tr u c tio n a n d D e v e l w a y s flo w o p m e n t, o r t h e W o r ld B a n k a s i t is m o r e c o m in w a y s th a t a c h ie v e th e m o s t d e s ir a b le s o c ia l o r e c o n o m ic r e s u lts . T h is m a y o c c u r m o n ly c a lle d . C lo s e a f f ilia t e s o f t h e W o r ld B a n k fo r a t le a s t tw o are rea so n s: F ir s t, b e c a u s e o f im p e r fe c tio n s in fin a n c ia l m a r k e ts , s o m e e c o n o m ic se c to r s th e and m ay s u f f ic ie n t se p a r a te , o f r e tu r n in t h e s e s e c to r s , o r t h e la c k o f a d e q u a te W o r ld in s t itu t io n s be a b le to fo r c h a n n e lin g o b ta in fu n d s in th e d ir e c tio n , m a y a c c o u n t fo r s u c h tio n s . S e c o n d ly , th e r e tu r n n eces im p e r fe c to p r iv a te s u p p lie r s th e se th e D ir e c to r s , th r ee and serve r e s p e c t iv e ly , C o r p o r a tio n A s s o c ia tio n . v e lo p m e n t as th e The a re o fte n n o t r e fle c t th e to ta l e c o n o m ic or s o c ia l b e n e fits le g a lly of th e P r e s id e n t and I n te r n a tio n a l th r ee The C o n s e q u e n tly , th e U . S . C o n g r e s s e s ta b lis h e d a n u m ber of F e d e r a l c r e d it p rogram s to im o ld e s t of to c o lle c t iv e ly F i D e in s t itu t io n s B a n k G roup. th a t r e s u lt fro m su c h in v e s tm e n ts . referred are D ir e c to r s o f th e I n te r n a tio n a l and o f fu n d s fr o m in v e s tm e n ts in c e r ta in s e c to r s m a y C o r p o r a tio n . a g e n c ie s n o r m a lly A s s o c ia tio n F in a n c e P r e s id e n t Bank nance D e v e lo p m e n t In te r n a tio n a l A lth o u g h c r e d it. I n v e s t o r u n fa m ilia r ity w it h r is k s o r r a te s sa ry not I n te r n a tio n a l th e th e in te r n a tio n a l l e n d i n g a g e n c i e s , t h e W o r ld a t th e B r e tto n s is te r in s titu tio n p r o m o te F u n d . A lth o u g h th e B a n k c e r ta in d e s ir e d e c o n o m ic and s o c ia l fo r ts in s titu tio n s a s of th e S m a ll F ederal L and B u s in e s s A d m in is tr a to w a rd th e W o r ld d e v e lo p m e n t B a n k , w a s fo u n d ed W o o d s C o n fe r e n c e in p r o v e t h e e f fic ie n c y o f fin a n c ia l m a r k e ts a n d /o r g o a ls . T h e s e p r o g r a m s a r e a d m in is te r e d b y s u c h as 1944 a s a o f th e I n te r n a tio n a l M o n e ta r y d ir e c te d it s e a r ly e f h e lp in g E u rop e, w a r -to r n fin a n c e th e r e c o n s tr u c tio n it has s in c e d ev o ted its th e a t te n t io n e n t ir e ly to fin a n c in g e c o n o m ic d e v e lo p F e d e r a l H o u s in g A d m in is tr a t io n , a n d t h e E x p o r t- m e n t. I n a d d itio n , it p r o v id e s t e c h n ic a l a s s is t a n c e Im p ort B an k . to d e v e lo p in g c o u n tr ie s . tio n , th e B ank B e c a u s e o f d iffe r e n c e s in in s titu tio n s am ong S y stem , The la w s, c u s to m s , a n d n a tio n s , h o w e v e r , im p e r fe c Bank n o r m a lly fin a n c e s th e fo r e ig n e x c h a n g e p o r tio n o f th e c o s ts o f c a r e f u lly s t u d ie d tio n s in in te r n a tio n a l m o n e y a n d c a p it a l m a r k e ts p r o je c ts th a t w ill c o n tr ib u te a p p r e c ia b ly a r e c o n s id e r a b ly g r e a te r th a n w it h in t h e U n it e d p r o d u c tiv ity to th e S ta te s . I n e f f ic ie n c y o f m o n e y a n d c a p ita l m a r k e ts o n ly to m e m b e r g o v e r n m e n ts , th e ir a g e n c ie s , o r o f t h e b o r r o w in g c o u n t r y . I t l o a n s w it h in in d iv id u a l c o u n tr ie s a d d s to t h e s e im p e r to p r iv a te fir m s w it h in m e m b e r c o u n tr ie s w h ic h f e c t io n s . M o r e o v e r , n a t io n s w ith carry in c o m e s and lo w in v e s tm e n ts in ra tes areas of lo w p e r c a p ita s a v in g r e q u ir e la r g e su ch as e d u c a tio n , tr a n s th e ir g o v e r n m e n t ’s g u a r a n te e . L oans are o n ly m a d e w h e n o th e r so u r c e s o f fin a n c in g c a n n o t b e o b t a i n e d ; b u t t h e b o r r o w in g c o u n t r y m u s t p o r ta tio n , a n d p o w e r fo r e c o n o m ic d e v e lo p m e n t. have W h ile c a r r ie s a fix e d r a te o f in te r e s t a n d h a s a m a tu r it y retu rn s q u ite h ig h , fr o m th e y su ch are in v e s tm e n ts r e a liz e d o n ly m ay over be lo n g th e c a p a c ity r a n g in g fr o m to s e r v ic e th e lo a n , w h ic h 1 0 to 3 1 y e a r s . T h e B a n k f in a n c e s p e r io d s o f tim e . I n a d d itio n , th e r e tu r n s t o p r iv a te a w id e v a r ie ty o f p r o je c ts; th e m o s t c o m m o n a r e in v e s to r s w ith l o a n s f o r h i g h w a y a n d r a i lr o a d c o n s t r u c t i o n a n d t h e b e n e fits th a t a c c r u e to n a tio n a l d e v e lo p m e n t lo a n s fo r b u ild in g d a m s to p r o v id e e le c t r ic p o w e r e ffo r ts . T h u s , in te r n a tio n a l in s t itu t io n s h a v e b e e n a n d ir r ig a tio n . m ay be q u ite s m a ll, com p ared fo r m e d t o c h a n n e l c r e d it to n a tio n s t h a t w o u ld T h e v a r i o u s r e s t r i c t i o n s o n t h e B a n k ’s f i n a n c o th e r w is e h a v e g r e a t d iff ic u lty in o b ta in in g fu n d s in g a c t iv itie s fo r b a d ly n e e d e d in v e s t m e n t p r o je c ts. fo r a n o th e r a g e n c y The in p a r tic ip a tio n m any of th e se of th e U. S. in s titu tio n s is G overnm ent b e c o m in g in to p r i v a t e f ir m s c r e a t e d th e n eed to s u p p le m e n t it s a c tiv itie s . T h i s r e s u l t e d in t h e f o r m a t i o n o f t h e I n t e r n a t i o n a l F in a n c e C o r p o r a tio n in 1955. The C o r p o r a tio n c r e a s in g ly im p o r ta n t in o u r o w n fo r e ig n p o lic y . m a k e s n o n g u a r a n te e d lo a n s to p r iv a te e n te r p r is e R e c e n t ly , in a s p e e c h o n L a tin A m e r ic a , P r e s i in d e n t N ix o n s p e c ific a lly c a lle d a t te n t io n to th e ir c a p ita l r o le in U . S . p o litic a l a n d fin a n c ia l p o lic y . H e A fte r it s c h a r te r w a s a m e n d e d in 1 9 6 1 , t h e I F C in d ic a t e d t h a t , in t h e fu tu r e , a m u c h la r g e r p o r h a s b e e n a b l e t o p r o v i d e r is k c a p i t a l b y p u r c h a s tio n of U . S. a id to L a tin A m e r ic a w o u ld be c h a n n e le d th r o u g h in te r n a tio n a l le n d in g a g e n c ie s . d e v e lo p in g is c o u n tr ie s not a v a ila b le w hen on s u f f ic ie n t p r iv a te r e a s o n a b le term s. in g s to c k in in d iv id u a l c o m p a n ie s a s w e ll. I n a d d i tio n to d ir e c tly f in a n c in g in d iv id u a l p r o je c ts in d e v e lo p in g c o u n tr ie s , t h e I F C in v e s t s in d e v e lo p T h e W o r ld Bank G ro u p M o s t im p o r ta n t o f t h e s e in s t itu t io n s is t h e I n M ARCH 19 70 m e n t b a n k s t h a t r e lo a n to o th e r in s t it u t io n s a n d p a r t ic ip a t e s in u n d e r w r itin g a n d s t a n d b y tr a n s a c 39 t io n s fo r p r iv a te fir m s r a is in g c a p it a l. F in a n c in g L o a n s m a d e b y th e s e p a r a te ly a d m in is te r e d F u n d a fo r S p e c ia l O p e r a tio n s ste e l p la n t in A r g e n tin a , a cem ent p la n t in T h a i l a n d , a n d a c e l l u l o s e a n d f ib e r p l a n t i n P a k tio n . i s t a n e x e m p l i f i e s t h e I F C ’s a c t i v i t i e s . E v e n a fte r t h e I F C b e g a n su p p le m e n tin g th e a c t iv it ie s o f t h e W o r ld B a n k , o th e r g a p s in d e v e lo p m e n t le n d in g s till r e m a in e d . M any in c o m e c o u n tr ie s h a v e u r g e n t n e e d s lo w fo r in v e s t r e s e m b le t y p e s o f lo a n s m a d e b y th e In te r n a tio n a l D e v e lo p m e n t A s s o c ia In a d d itio n , tr u st fu n d S o c ia l on th e ID B a d m in is te r s , b e h a lf o f t h e P rogress T ru st U n ite d Fund as a S ta te s, th e w h ic h c h a n n e ls U . S . c o n tr ib u tio n s to L a tin A m e r ic a u n d e r th e A llia n c e fo r P ro g ress. A fte r r e c e iv in g its la s t m e n t in s o c ia l o v e r h e a d s u c h a s h o u s in g , s c h o o ls , in c r e a s e in r e s o u r c e s in 1 9 6 5 , t h is fu n d h a s b e e n tr a n s p o r ta tio n , a n d p o w e r in o r d e r to a c c e le r a te c o m b in e d w it h t h e F u n d fo r S p e c ia l O p e r a tio n s . e c o n o m ic d e v e lo p m e n t. B u t s e r v ic in g lo a n s m a d e on a c o n v e n tio n a l b a s is w o u ld im p o s e sev ere s tr a in s o n t h e a lr e a d y p r e c a r io u s b a la n c e o f p a y m e n ts s it u a tio n s o f m a n y o f t h e s e n a tio n s . C o n s e q u e n tly , s o c ia tio n th e I n te r n a tio n a l (ID A ) D e v e lo p m e n t w a s c r e a te d in so -c a lle d “so ft c a p a c ity to o b ta in lo a n s ” to n a tio n s c a p ita l A s 1 9 6 0 to p r o v id e w ith a n d /o r lim ite d s e r v ic e con ID A s im ila r to m akes p r io r ity th o se m a d e b y d e v e lo p m e n t t h e W o r ld Bank but and o n c o n s id e r a b ly m o r e g e n e r o u s te r m s “ so ft lo a n ” ) . lo a n s o f p u rp o ses fo r a s o m e w h a t b r o a d e r r a n g e e x p r e s s io n L oans ( th u s, th e are n o r m a lly g r a n te d o n a n in te r e s t - fr e e b a s is ( w ith a % o f o n e percent per fo u n d e d in la t e 1 9 6 6 . T h e A D B , m o d e le d s o m e w hat a fte r annum s e r v ic e charge) fo r a th e In te r -A m e r ic a n D e v e lo p m e n t B a n k , is a r e g io n a l b a n k fo r A s ia . T h u s , i t c o n d u c ts d e v e lo p m e n t le n d in g o p e r a tio n s u s in g c r ite r ia s im ila r to t h o s e o f t h e W o r ld B a n k a n d m akes “so ft s p e c ia liz e d v e n t io n a l lo a n s . The T h e U n ite d S ta t e s h a s a ls o b e c o m e a p a r tic i p a tin g m e m b e r in t h e A s ia n D e v e lo p m e n t B a n k , v e lo p m e n t lo a n s ” th r o u g h p u rp o ses. Bank I n te r -A m e r ic a n p o rta n t resp ect: sev era l H ow ever, d iffe r s fu n d s th e A s ia n s ig n ific a n tly D e v e lo p m e n t B ank A p p r o x im a te ly in fo r D e fr o m th e one im o n e -th ir d o f its su b s c r ib e d c a p ita l a n d , th e r e fo r e , a s im ila r p r o p o r tio n o f it s v o t in g p o w e r b e lo n g to n o n r e g io n a l in d u s tr ia l n a tio n s . m a t u r ity p e r io d o f 5 0 y e a r s . T h e r e p a y m e n t s c h e d u le in c lu d e s a 1 0 -y e a r g r a c e p e r io d , 1 0 y e a r s d u r in g w h ic h o n e p e r c e n t o f t h e p r in c ip a l is r e p a id a n C A P IT A L RESO U RCES IN T E R N A T IO N A L L E N D IN G OF A G E N C IE S ($ T h o u sa n d s) n u a lly , a n d 3 0 y e a r s d u r in g w h ic h 3 p e r c e n t o f t h e p r in c ip a l is r e p a id a n n u a lly . R e g io n a l In a d d itio n to Subscribed C a p ita l P a id -in C a p ita l 23,036 2,304 107 107 International Developm ent Association* 1,013 V o tin g C ap ita l Supplem entary 1,053 Resources 1,013 L e n d in g A g e n c ie s th e in te r n a tio n a l in s titu tio n s W o rld B a n k * j u s t d e s c r ib e d , th e U n it e d S t a t e s h a s a ls o p a r ti c ip a t e d in t h e fo r m a tio n o f r e g io n a l a g e n c ie s t h a t p r o m o te e c o n o m ic A m e r ic a n is th e d e v e lo p m e n t. The In te r- D e v e lo p m e n t B a n k , fo u n d e d in o ld e s t of su ch in s t itu t io n s . 1959, The ID B , w h o s e o r ig in a l m e m b e r s h ip in c lu d e d t h e U n ite d S ta te s and crea ted 20 L a tin A m e r ic a n c o u n tr ie s , w as to s u p p le m e n t th e w o rk o f o th e r in te r n a tio n a l in s t itu t io n s in L a tin A m e r ic a and to d e a l w it h p r o b le m s p e c u lia r to t h a t r e g io n . A s id e fro m p r o m o tin g e c o n o m ic in d iv id u a l L a tin has concerned been A m e r ic a n w ith d e v e lo p m e n t c o u n tr ie s , w ith in th e s u p p o r tin g ID B r e g io n a l e c o n o m ic in te g r a tio n . I n it s o r g a n iz a tio n a l str u c tu r e , th e I D B com b in e s f e a tu r e s o f b o th t h e W o r ld B a n k a n d I n te r n a tio n a l D e v e lo p m e n t A s s o c ia tio n . p a tte r n e d a fte r th o se 40 of th e W o r ld Inter-A m erican Developm ent B a n k * * O rd in a ry C a p ital F u n d for Special Operations Social Progress T ru st F u n d A s ia n Developm ent B an k** 1,053 2,741 475 1,900 1,900 525 525 970 291 th e W hen l e n d i n g o u t o f o r d i n a r y c a p i t a l , t h e I D B ’s p o l i c i e s are International Finance C orporation* * A s of June 30, 1969 * * A s of Decem ber 31, 1968 B ank. M O N TH LY R E V IE W in g . A t te m p t s t o b o o s t lo a n a b le r e s o u r c e s th r o u g h U. S. P A R T I C I P A T IO N IN T E R N A T IO N A L IN C A P IT A L L E N D IN G in c r e a s in g OF c a p ita l s u b s c r ip tio n s of m em ber n a t io n s h a v e m e t w ith d if f ic u lt y b e c a u s e o f b a la n c e A G E N C IE S o f p a y m e n t s p r o b le m s o f v a r io u s in d u s t r ia liz e d ($ T housands) n a tio n s Subscribed C ap ital th a t fu r n is h m o st of th e new c a p it a l. T h is p r o b le m h a s b e c o m e p a r t ic u la r ly s e v e r e fo r P aid-in C apital “ s o f t lo a n ” a g e n c ie s w h ic h d e p e n d u p o n c a p it a l c o n tr ib u tio n s fo r th e ir p r in c ip a l so u r c e o f fu n d s . W o rld B a n k * 6,350 635 35 35 C o n t r ib u t io n s to International Finance Corporation* Intern ational Developm ent Association* V o tin g C ap ital Supplem entary Resources Inter-A m erican Developm ent B a n k * * O rd in a ry C ap ital F u n d for Special Operations Social Progress T ru st F u n d S in c e th e ir in s titu tio n s 320 in te r n a tio n a l here have le n d in g c o m m itte d a c u m u la tiv e to ta l o f th e e q u iv a le n t o f $ 1 7 b illio n 320 312 in c e p t io n , d e s c r ib e d D e v e lo p m e n t 312 to f in a n c in g e c o n o m ic d e v e lo p m e n t. S lig h t ly le s s th a n h a lf h a s b e e n d is b u r s e d . T h e s e in v e s t m e n ts have 1,174 150 1,800 m ade p o s s ib le a a d d itio n a l in v e s tm e n ts c o n s id e r a b le fr o m o th e r am ount so u rces, of p r i v a t e a s w e ll a s p u b lic , t h a t p r o b a b ly w o u ld n o t h ave been m ade 1,800 o th e r w is e . M o r e o v e r , th e ir ex p e r ie n c e h a s p r o v e d h e lp fu l in c o o r d in a tin g o th e r 525 525 200 A sia n Developm ent Ban k** 60 t y p e s o f o f f i c i a l a i d . T h i s c o o r d i n a t io n , b y r e d u c in g d u p lic a tio n o f e ffo r t, h a s m a d e fin a n c ia l a id m o r e e ffe c tiv e . I n a d d itio n to p r o v id in g fin a n c ia l r e so u r c e s, th e s e a g e n c ie s h a v e b u ilt a v a s t sto r e * A s of June 30, 1969 * * A s of Decem ber 31, 1968 o f v a lu a b le d e v e lo p m e n t e x p e r tis e t h a t h a s b e e n p a s s e d o n to r e c ip ie n t c o u n tr ie s . M e th o d s I n te r n a tio n a l le n d in g le n d in g th r o u g h a D e s p it e th e fo r m id a b le d iff ic u ltie s o f d ir e c tly o f F in a n c in g a g e n c ie s o b ta in v a r ie ty of fu n d s fo r m e th o d s . P a id - in m e a s u r in g th e im p a c t of a g e n c ie s , th e ir le n d in g a c tiv itie s in te r n a tio n a l le n d in g h a v e c e r ta in ly c a p ita l fr o m m e m b e r n a tio n s is a c o m m o n s o u r c e c o n tr ib u te d to fa v o r a b le r e s u lts a lr e a d y s e e n in of th e fu n d s W o r ld to a ll th e Bank m ent Bank and have s e c u r itie s o n a g e n c ie s . In a d d itio n , th e I n te r -A m e r ic a n b e e n •a b le w o r ld c a p ita l to D e v e lo p flo a t th e ir m a r k e ts th e ow n b eca u se of la r g e m a r g in s o f c a lla b le c a p it a l a n d b e c a u s e o f th e q u a lity o f th e ir lo a n s . T h e A s ia n m e n t B a n k is lik e w is e e x p e c te d in t h is m a n n e r . Som e of th e le n d in g to D e v e lo p r a is e fu n d s e c o n o m ic p e r io d d e v e lo p m e n t record. O ver th e 1 9 6 0 -6 7 , d e v e lo p in g c o u n tr ie s a s a w h o le e x p e r ie n c e d h ig h e r a v e r a g e g ro w th r a te s in G N P , in a g r ic u ltu r a l in gross and in d u s tr ia l in v e s tm e n t c o u n tr ie s . th a n O f cou rse, w id e v a r ia tio n in one p r o d u c tio n , d id m u st e c o n o m ic and in d u s t r ia liz e d c o n s id e r p erfo r m a n c e th a t e x is ts a m o n g in d iv id u a l c o u n tr ie s . in s t itu t io n s have a ls o D e s p ite th e ir g a in s , le s s d e v e lo p e d n a tio n s a u g m e n te d th e ir lo a n a b le r e s o u r c e s th r o u g h s a le s s t ill f a c e s o m e d if f ic u lt p r o b le m s . F o r in s t a n c e , o f p a r tic ip a tio n s in th e ir o w n p o r tfo lio s . R e p a y b ecau se m e n t s o n p a s t lo a n s p r o v id e a d d it io n a l f u n d s fo r in c r e a s e in p e r c a p it a G N P w a s le s s t h a n fo r i n new d u s tr ia liz e d le n d in g a c tiv ity to th e W o r ld B ank, th e of th e ir r a p id p o p u la t io n g ro w th , th e c o u n tr ie s . M o r e o v e r , d e b t s e r v ic in g I n te r -A m e r ic a n D e v e lo p m e n t B a n k , a n d th e I n r e q u ir e m e n ts o n t e r n a t i o n a l F i n a n c e C o r p o r a t io n . T h e o t h e r t w o b e in g s h o r t-te r m , is b e c o m in g a s e r io u s b u r d e n fo r a g e n c ie s h a v e n o t o p e r a te d som e. c e iv e lo a n lo n g enough to re T h u s, r e p a y m e n ts. B u t t h e g r o w in g d e m a n d s fo r f u n d s in w o r ld e x te r n a l d e b t, a d e v e lo p in g c o u n tr ie s la r g e p o r tio n need in c r e a s in g a m o u n ts o f n e w c a p ita l to o v e r c o m e t h e s e c r itic a l c a p ita l m a r k e ts h a v e m a d e th e c o m p e tit io n fa c in g p r o b le m s a n d to c o n s o lid a t e e c o n o m ic t h e s e a g e n c ie s fo r o b ta in in g fu n d s m o r e in te n s e ready in r e c e n t y e a r s . F u r th e r m o r e , th e a c c o m p a n y in g th e r is e tin u e of h ig h w o r ld le v e ls in te r e s t has g r e a tly ra tes to e x tr a o r d in a r ily in c r e a s e d th e cost of fu n d s n e c e s s a r y fo r s u s ta in in g d e v e lo p m e n t le n d M ARCH 1970 a c h ie v e d . in te r n a tio n a l to have a P a st e x p e r ie n c e le n d in g la r g e in s titu tio n s in flu e n c e g a in s a l su g g e sts on w ill th e th a t con fu tu r e d ir e c tio n o f fin a n c ia l flo w s to m e e t t h e s e n e e d s . J ohn E . L e im o n e 41 A r e a D i v e r s i t y in L o u i s i a n a ' s G r o w t h P e r s is te n t d iffe r e n tia ls in e c o n o m ic g ro w th are L a fa y e tte -I b e r ia -H o u m a area, bank lo a n s in fr e q u e n tly fo u n d a m o n g g e o g r a p h ic a r e a s. S u c h cr e a se d a t a m o d e r a te b u t s te a d y p a c e th r o u g h d iffe r e n tia ls a r e o fte n r e la te d to d iffe r e n c e s in e c o o u t t h e s a m e f iv e -y e a r p e r io d . n o m ic str u c tu r e . D iv e r s it y in e c o n o m ic p e r fo r m D e p o s it a c t iv ity in th e d iffe r e n t a r e a s c lo s e ly a n c e w ith in v a r io u s a r e a s o f L o u is ia n a illu s t r a te s p a r a lle le d lo a n a c t iv ity . A s in lo a n s , B a t o n R o u g e th e se and p a tte r n s. g ro w th w ith arou n d b o o m in g R ouge, L ake and For N ew e x a m p le , O r le a n s a c tiv ity in s u r r o u n d in g C h a r le s 1 9 6 9 , h o w e v e r .) and L ake areas. B a to n s lo w e c o n o m ic C h a r le s , (T h is A le x a n d r ia -L a k e C h a r le s su rp a ssed o th e r s h a r p ly co n tra sts a r e a s in d e p o s it e x p a n s io n fr o m 1 9 6 5 th r o u g h 1 9 6 8 B a to n b u t d is p la y e d a le s s h e c t ic p a c e in 1 9 6 9 . N e w O r boom in R o u g e ta p e r e d o ff in T h e s e d iv e r g e n t p a tte r n s w ith in le a n s tr a ile d b e h in d a ll o th e r a r e a s in t h e r a te o f d e p o s it N ew g ro w th . T h e le v e lin g -o ff o f O r le a n s d u r in g 1969, th o u g h d e p o s its in c o n tr a s tin g L o u is ia n a a r e c lo s e ly r e la te d to g e o g r a p h ic d iffe r s h a r p ly w ith t h e u p s u r g e in lo a n s , r e m a in e d c o n e n c e s in e c o n o m ic m a k e u p . s is t e n t w ith t h e lo n g e r -r u n tr e n d s in b o th in d ic a G ro w th a s M e a s u r e d b y B a n k i n g A c tiv ity to rs. D e p o s it s in n o r th L o u is ia n a a n d L a fa y e tte I b e r ia -H o u m a a d v a n c e d s t e a d ily u p w a r d . M e m b e r b a n k lo a n s a n d d e p o s its , tw o im p o r ta n t b a r o m e te r s o f e c o n o m ic a c tiv ity , sh o w th a t e c o n o m ic e x p a n s io n h a s p r o c e e d e d u n e v e n ly in th e P e lic a n E m p lo y m e n t T r e n d s T h e r a te o f jo b e x p a n s io n fo r t h e d iffe r e n t s e c S ta t e . D u r in g t h e 1 9 6 5 -6 9 p e r io d , A le x - t io n s o f t h e s t a t e c lo s e ly f o llo w e d g r o w th p a tte r n s a n d r ia -L a k e C h a r le s a n d B a t o n R o u g e tr a d e a n d e v id e n t in b a n k in g a c t i v i t y .1 T h u s , L a k e C h a r le s b a n k in g a r e a s o u t s t r ip p e d o t h e r s e c t io n s in th e a n d B a to n R o u g e su r p a s s e d a ll o th e r L o u is ia n a g r o w th o f b a n k lo a n s . H o w e v e r , d u r in g m o s t o f S M S A ’s i n e m p l o y m e n t , d e s p i t e s o m e s l i p p a g e i n 19 6 9 , lo a n a c t iv ity b e h a v e d m o r e s lu g g is h ly . N e w O r le a n s , o n th e o th e r h a n d , e x p e r ie n c e d a n u p s u r g e in 1 9 6 9 a fte r la g g in g b e h in d d u r in g m o s t o f t h e 1 9 6 5 -6 9 p e r io d . I n n o r th 42 L o u is ia n a a n d th e ’ A n in d ic a t io n o f e m p lo y m e n t t r e n d s in in b a n k in g a re a s c a n b e in fe r r e d fro m th e b e m e n t in th e S t a n d a r d M e t r o p o lit a n S t a t is t ic a E m p lo y m e n t w it h in L o u is ia n a ’s s ix S M o v e r h a lf o f t o t a l s ta te e m p lo y m e n t . d iv id u a h a v io r l A r e a s S A ’s M O N T H L Y R E V IE W M EM B ER BAN K LOANS M EM BER BANK D E P O S IT S Million $ Million $ -1 5 0 0 2090 NEW O RLEANS 750 1350 N O R T H L O U IS IA N A 500 NORTH 730 L O U IS IA N A 290 470 260 395 140 255 A L E X A N D R IA - 200 310 LA KE C H A R L E S 100 200 130 LAFA YETTE- 250 LA FA Y E T TE IB E R IA - H O U M A 65 l i I i 160 i 65 67 '6 9 Note: All figu res except those for north Louisiana are seasonally adjusted and are show n by trade and banking areas. The areas include several counties surrounding central cities. 1 9 6 9 , th e r e b y n e a r ly p a r a l l e l i n g b a n k in g t r e n d s in th e L a k e C h a r le s a n d B a t o n R o u g e tr a d e a n d Note: A ll figures except those for north Louisiana are seasonally adjusted and are show n by trade and banking areas. The areas include several counties surrounding central cities. th e e x p a n s io n of th ese tw o in d u s tr ie s is w e ll know n. th e se T h e lo n g in v e s t m e n t b o o m in L a k e C h a r le s a n d tw o s e c tio n s o f th e s t a t e c a n b e la r g e ly e x p la in e d B a t o n R o u g e h a s a ls o s p a r k e d la r g e in c r e a s e s in b y t h e i r l i o n ’s s h a r e o f L o u i s i a n a i n v e s t m e n t i n c o n s tr u c tio n new a c c o u n t s fo r a m u c h la r g e r s h a r e o f t o t a l e m p l o y b a n k in g areas. T h e and exp an d ed e c o n o m ic p la n t and u p su rg e in e q u ip m e n t fro m e m p lo y m e n t; in fa c t, c o n s tr u c tio n 1 9 6 5 -6 9 . T h is e x p a n s io n is r o o te d in t h e b u r g e o n m e n t w i t h i n t h e s e S M S A ’s t h a n i n t h e r e s t o f t h e in g p e tr o le u m r e fin in g a n d r e la t e d p e tr o -c h e m ic a l sta te. in d u s tr ie s , w ith s tr u c tio n s o m e a d d itio n a l g r o w th d e r iv e d C o n s e q u e n tly , d ependence e s p e c ia lly on con s e n s itiv e to th e drop L o u i s i a n a ’s r a w m a t e r i a l r e s o u r c e s i n p r o m o t i n g d u r i n g 1 9 6 9 . L o c a l la b o r p r o b l e m s a n d t h e s l u m p 19 70 new th e ir fr o m th e p a p e r a n d lu m b e r in d u s tr ie s . T h e r o le o f M ARCH in m a d e th e m in v e s t m e n t o c c u r r in g in L o u is ia n a 43 C i v i l i a n BATON E m ROUGE p lo y m e n t (L o u i s i a n a LAFAYETTE Thousands Thousands S M LAKE S A CHARLES ’s ) Thou$ands — 50 '65 M O NRO E NEW ORLEANS SHREVEPO RT — 125 100 I l 65 I I 67 I '69 I '6 5 t h a t c h a r a c te r iz e d c o n s tr u c tio n n a tio n a lly a d d e d t o t h e d iffic u ltie s o f t h a t s e c to r in B a t o n R o u g e The I g ro w th o f e m p lo y m e n t in S h r ev ep o r t, a n d I '67 '69 th e L a fa y e tte , M o n r o e S M S A ’s t e n d s t o s u b a n d L a k e C h a r le s . T h e c o n t r a c t io n o f n e w in v e s t s t a n t ia t e t h e p a tte r n o f a m o d e r a te , u p w a r d tr e n d m e n t p r o b a b ly in d ic a te d b y b a n k in g d a ta in lo w e r c e n tr a l a n d ca u sed a d v e r s e r e p e r c u s s io n s in o th e r s e c to r s o f e c o n o m ic a c t iv it y a s w e ll. n o r th L o u is ia n a . T w o d iv e r g e n t fo r c e s h a v e a f fe c t E m p lo y m e n t in t h e N e w O r le a n s a r e a fa lte r e d e v e n m o r e t h a n b a n k in g a c t iv it y . T h e lim it e d e x ed e c o n o m ic fo r tu n e s in and around L a fa y e tte . T h e r e la t iv e ly la r g e im p o r ta n c e o f a g r ic u ltu r e , a p a n s io n in jo b s a p p e a r s to b e d ir e c t ly r e la te d to t r a d itio n a lly d e c lin in g s e c to r o f e m p lo y m e n t, a n d t h e fo r tu n e s o f th e M ic h o u d th e w h ic h e m p lo y m e n t fe ll fr o m Space a F a c ilit y , peak of in 1 1 ,5 0 0 c lo s e ly in d u s tr y r e la te d fo o d h a v e te n d e d and to h o ld k in d r e d dow n p r o d u c ts t h e o v e r a ll p e r s o n s in 1 9 6 4 to th e c u r r e n t le v e l o f a p p r o x i a s c e n t o f e m p lo y m e n t. N e v e r th e le s s , in v e s tm e n t m a t e ly 3 ,6 0 0 p e r s o n s . I n a d d itio n , N e w O r le a n s ’ in s lu g g is h g r o w th m a y h a v e b e e n in flu e n c e d b y t h e in d u s tr ie s d o m in a n c e o f fo o d L a f a y e t t e ’s and k in d r e d p r o d u c ts, t y p i c a lly a s lo w -g r o w th a n d lo w -w a g e in d u s t r y g r o u p . th e g r o w th -o r ie n te d have jo b m ore p e tr o le u m th a n g r o w th in o ffse t and c h e m ic a l th e se e ffe c ts. c o n s tr u c tio n and t r a n s p o r ta tio n , c o m m u n ic a tio n s , a n d p u b lic u t i l i T h a t th e d r a g o n to ta l e c o n o m ic a c t iv ity in N e w tie s O r le a n s w a s n o t g r e a te r s t e m s fr o m r e f le c t t h e r e p e r c u s s io n s o f t h is p a r t ic u la r t y p e o f s h ip b u ild in g a boom d u r in g t h e la s t tw o y e a r s . 44 in ( in c lu d in g p ip e lin e e m p lo y m e n t) te n d s to in v e s tm e n t. M O N TH LY R E V IE W d is p la y s f a y e t t e a n d n o r th L o u is ia n a , d e s p it e t h e in v e s t s o m e d iv e r g e n t fo r c e s . T h e d e c lin e in a g r ic u ltu r a l N o r th e r n L o u i s i a n a ’s econom y a ls o m e n t d r o p -o ff in p e tr o le u m a n d r e la te d p r o d u c ts . e m p lo y m e n t a r o u n d S h r e v e p o r t a n d a s ta n d s till S u c h in d u s tr ie s p la y a s m a lle r r o le in t h e s e p a r ts i n M o n r o e a n d S h r e v e p o r t ’s r e l a t i v e l y i m p o r t a n t o f t h e s ta te . F u tu r e g ro w th w ill d e p e n d la r g e ly f o o d in d u s t r ie s r e s tr ic te d e x p a n s io n . O n t h e o th e r u p o n t h e e x t e n t to w h ic h t h e y c a n d iv e r s if y a w a y h a n d , in v e s tm e n t in p e tr o le u m a n d c h e m ic a ls , a s fro m a g r ic u ltu r e a n d fo o d in d u s tr ie s to m o r e d y w e ll a s in lu m b e r a n d r e la t e d in d u s t r ie s , p r o v id e d n a m ic in d u s tr ie s . T h e S h r e v e p o r t S M S A h a s d i a s o u r c e o f g r o w th . A c o n s id e r a b le u p s u r g e in in v e r s ifie d v e s tm e n t a n d e m p lo y m e n t in m e ta l a n d m a c h in m e ta l a n d lin k e d m a c h in e r y in d u s tr ie s . T h is la t e r y in d u s tr ie s a d d e d a fu r th e r b o o s t t o S h r e v e te r in d u s t r y h a s a t r a d itio n a lly fa v o r a b le r e c o r d p o r t ’s e c o n o m y . o f lo n g - r u n e x p a n s i o n . so m ew h a t by e x p a n d in g its p r im a r y D e s p it e a d v e r s e im p a c t fr o m t h e s c a lin g -d o w n P ro sp e c ts a t M ic h o u d , th e r e are so m e p o te n tia lly b r ig h t T h e le s s h e c t ic e c o n o m ic p a c e in t h e L a k e C h a r le s s p o t s in N e w O r le a n s ’ e c o n o m y . T h e tr a n s p o r ta a n d B a t o n R o u g e a r e a s in 1 9 6 9 r e fle c ts a d r o p -o ff tio n e q u ip m e n t in d u s tr y — s h ip b u ild in g c o n s t it u t in in v e s tm e n t, e s p e c ia lly in p e tr o le u m a n d p e tr o in g a s ig n ific a n t p a r t— c o n t in u e s to a d d s ig n ifi c h e m ic a ls , a n d lo c a l a n d n a tio n a l d e v e lo p m e n ts c a n t ly to N e w O r le a n s ’ m a n u fa c tu r in g jo b to ta l. in A m o d e r n iz a tio n p r o g ra m o f p o r t f a c ilit ie s s h o u ld c o n s tr u c tio n . th e se tw o F u tu re g e o g r a p h ic e c o n o m ic areas, p r o sp e c ts th e re fo re, fo r d epend im p r o v e N e w O r le a n s ’ r o le in h a n d lin g in te r n a u p o n t h e a b ilit y o f t h e s e in d u s tr ie s to r e g a in th e ir t io n a l tr a d e , th e r e b y p r o v id in g a n a d d itio n a l b o o s t e c o n o m ic str e n g th . to th e area. E c o n o m ic a c t iv itie s a d v a n c e d s te a d ily in La J This is one o f a series o f articles in which econom ic developm ents in each of the Sixth D istrict ohn E. states are L e im o n e discussed. B a n k A n n o u n ce m e n ts M. Feagin, cashier. Capital is $400,000; surplus and other capital funds, $168,897. On February 23, Congress National Bank, Palm Springs, Florida, a newly organized member bank, opened for business. Officers are Jerry Thomas, chairman; Daniel S. Goodrum, president; George H. Boutwell, executive vice president and cashier; Dennis Grimes, vice presi dent; and Mrs. Jean Pinder, assistant cashier. Capital is $375,000; surplus and other capital funds, $375,000. On February 26, another newly organized nonmember bank, University State Bank, Tampa, Florida, opened for business. Charles E. Futch, Jr. is president and Cecil R. Fultz, Jr. is cashier. Capital is $500,000; sur plus and other capital funds, $150,000. Five Points Guaranty Bank, Jacksonville, Florida, opened for business as a newly organized nonmember bank on February 25. Officers are Julian E. Fant, chair man; Julian E. Fant, Jr., vice chairman; Carl E. Graham, president; Eloise S. Perryman, vice president; and Eva DeKalb County Bank, Atlanta, Georgia, opened for busi ness on February 27 as a newly organized nonmember bank. Officers are J. Mack Robinson, chairman; David M. Housend, president; Clinton L. Sanders, vice presi dent; and K. Lamar Thomas, cashier. Capital is $300,000; surplus and other capital funds, $300,000. M ARCH 1 9 70 45 S ix t h D is t r ic t S t a t is t ic s S e a s o n a lly A d ju ste d (A ll d a ta are Latest Month in d e xe s , One Month Ago Two Months Ago 1 9 5 7 -5 9 INCOME AND SPENDING . Dec. . Dec. . Dec. N.A. 250 150 122 202 N.A. 251 156 133 193 N.A. 249 155 112 188 66,211 233 139 126 171 292.0 307.0 337.7 296.0 320.0 298.4 282.6 248.3 152 149 176 143 180 118 106 131 135 116 210 152 142 61 152 149 176 141 182 117 108 130 136 116 209 153 142 56 149 149 176 141 176 116 111 128 128 116 207 149 146 63 3.5 Instalment Credit at Banks* (Mil. $) . Jan. . Jan. PRODUCTION AND EMPLOYMENT u n le s s in d ic a te d Latest Month Manufacturing .................................. N o nm anufacturing ............................ C o n s t r u c t io n .................................. . . Jan. Farm E m p lo ym e n t.................................. . . Jan. Unemployment Rate (Percent of Work ForceJt . . . . . Jan. Avg. Weekly Hrs. in Mfg. (Hrs.) . . . Jan. o th e rw is e Two One Month Months Ago Ago One Year Ago 178 176 138 91 177 176 134 93 176 178 136 90 177 169 129 94 2.4 41.3 2.6 41.4 2.8 41.3 2.6 41.0 385 259 294 379 278 284 378 263 294 324 250 251 N.A. 256 189 N.A. 271 160 N.A. 268 149 12,915 242 147 . Jan. . Jan. 154 145 159 154 56 153 145 157 151 59 154 146 157 153 48 150 143 153 160 64 . Jan. . Jan. 2.9 39.7 3.1 40.5 3.3 40.5 2.5 41.4 . Jan. . Jan. 348 229 317 347 242 307 344 236 322 324 250 264 . Dec. . Jan. N.A. 200 136 N.A. 191 158 N.A. 194 164 9,487 181 156 136 124 139 154 45 134 123 136 140 50 134 123 136 135 51 134 123 136 154 51 . Jan. . Jan. 5.2 42.6 5.1 41.2 5.6 42.0 4.7 41.5 . Jan. 278 176 217 281 186 204 270 179 207 247 178 190 N.A. 269 118 N.A. 261 126 N.A. 266 131 5,059 260 133 Jan. Jan. Jan. Jan. Jan. 149 157 146 171 54 148 156 144 158 50 147 156 144 157 45 147 157 142 160 57 Jan. Jan. 3.9 40.9 3.8 40.7 4.7 40.8 3.6 40.9 Member Bank Loans* . . . . Member Bank D e p o s it s * ............................Jan . Jan. Bank D e b its*/**.................................................. Jan 425 277 284 408 279 264 407 273 304 359 254 242 FINANCE AND BANKING Member Bank L o a n s ............................ . . Jan. Member Bank D e p o sits...................... . . Jan. Bank D e b its * * ............................................. GEORGIA t . Jan. 153 150 176 142 178 118 109 128 135 117 210 154 149 60 Unemployment Rate (Percent of Work Fon Insured Unemployment . Jan. 3.5 3.7 3.3 Avg. Weekly Hrs. in Mfg. (Hrs.) Construction Contracts* . . . . Jan. . Jan. . Jan. . Dec. . Dec. “ Jan. 2.3 40.6 439 318 542 167 103 232 1.9 40.7 292r 332 258r 165 98 238 1.8 40.8 200 216 187 164 101 233 1.9 41.0 290 268 309 153 101 206 . Jan. Jan. 342 289 339 286 335 282 301 265 . Jan. . Jan. . Jan. 225 186 276 238 199 268 229 189 278 224 189 243 . Jan. . Jan. . Jan. . Jan. . Jan. Textiles ....................................... Transportation Equipment . Jan. . Jan. Construction Electric Power Production* 1 0 0 , One Year Ago SIXTH DISTRICT Personal Income (Mil. $, Annual Rate = INCOME Personal Income (M il. $, Annual Rate) . . . . Manufacturing Payrolls . . . . Farm Cash R e c e ip t s ............................ . . Dec. . . Jan. . . Dec. PRODUCTION AND EMPLOYMENT Nonfarm Employmentt . . . . . Manufacturing .................................. . N o nm anufacturing ............................ C o n s t r u c t io n .................................. . Farm E m p lo ym e n t........................................ Unemployment Rate (Percent of Work ForceJt . . . . Avg. Weekly Hrs. in Mfg. (Hrs.) . . . Jan. . Jan. FINANCE AND BANKING Member Bank L o a n s ................................. Member Bank D e p o sits............................ Bank D e b its**.................................................. LOU SIANA FINANCE AND BANKING Loans* Bank Debits*/* ALABAMA $ Personal Income (Mil. $, Annual PRODUCTION AND EMPLOYMENT Nonmanufacturing Personal Income (Mil. $, Annual . Dec. . Jan. . Dec. N.A. 216 143 N.A. 216 131 N.A. 211 118 8,245 197 123 . . . . . Jan. Jan. Jan. Jan. Jan. 134 137 133 127 60 134 137 132 125 64 134 137 133 125 63 132 135 131 124 61 . Jan. , Jan. 3.8 40.3 3.9 40.8 4.0 40.9 3.6 40.9 Jan. Jan. Jan. 306 210 248 306 218 238 300 215 239 272 211 223 Dec. Jan. Dec. N.A. 336 172 N.A. 348 198 N.A. 331 222 20,275 300 151 Jan. 177 177 178 171 PRODUCTION AND EMPLOYMENT Nonfarm Employmentt . . . . Manufacturing ............................ Nonmanufacturing . . . . C o n s t r u c t io n ............................ Farm Em p lo ym e n t............................ Unemployment Rate (Percent of Work ForceJt . . Avg. Weekly Hrs. in Mfg. (Hrs.) Unemployment Rate (Percent of Work ForceJt . . Avg. Weekly Hrs. in Mfg. (Hrs.) FINANCE AND BANKING Member Bank Loans* FINANCE AND BANKING . . . . M ISSISSIPPI Personal Income (Mil. $, Annual R a t e ) ............................Dec . Dec. Manufacturing P ayrolls..................................Jan Farm Cash R e c e ip t s ....................................... Dec PRODUCTION AND EMPLOYMENT FLORIDA $ Personal Income (Mil. $, Annual Rate) . . . Manufacturing Payrolls . . . Farm Cash R e c e ip t s ...................... PRODUCTION AND EMPLOYMENT Nonfarm Employmentt . . . 46 Unemployment Rate (Percent of Work ForceJt • • Avg. Weekly Hrs. in Mfg. (Hrs.) FINANCE AND BANKING M O N TH LY R E V IE W One Two MonthMonths Ago Ago Latest Month ~ “ TENN ESSEE $ One Year Ago INCOME Personal Income N.A. N.A.N.A. 10,230 (Mil. $, Annual R a t e ) ................Dec. Manufacturing Payrolls................... Jan. 242 243 241 235 116 147 121 111 Farm Cash R e c e ip t s ...................... Dec. PRODUCTION AND EMPLOYMENT Nonfarm Em ploym entt................... Jan. Manufacturing ......................... Jan. 150 157 149 157 147 154 147 155 Latest Month Nonm anufacturing...................... Jan. C o n s tr u c tio n ......................... Jan. Farm Em ploym ent......................... Jan. Unemployment Rate (Percent of Work F o rc e lt.............Jan. Avg. Weekly Hours in Mfg. (Hrs.) . . Jan. One Two Month Months Ago Ago One Year Ago 147 177 62 145 165 62 145 164 57 145 180 63 3.9 40.0 3.6 40.4 3.9 40.4 3.2 40.5 324 203 262 319 213 273 317 206 278 293 189 275 FINANCE AND BANKING Member Bank L o a n s * ................... Jan. Member Bank D e p o s it s * ................Jan. Bank D e b its*/**.............................Jan. *For Sixth District area only Other totals for entire six states **Daily average basis tPreliminary data tEmployment figures for Alabama, Florida, Georgia, and Tennessee have been adjusted to new bench mark data. r-Revised N.A. Not available Sources: Personal income estimated by this Bank; nonfarm, mfg. and non mfg. emp., mfg. payrolls and hours, and unemp., U.S. Dept, of Labor and cooperating state agencies; cotton consumption, U.S. Bureau of Census; construction contracts, F. W. Dodge Div., McGraw-Hill Information Systems Co.; petrol, prod., U.S. Bureau of Mines; industrial use of elec. power, Fed. Power Comm.; farm cash receipts and farm emp., U.S.D.A. Other indexes based on data collected by this Bank. All indexes calculated by this Bank. D e b it s to D e m a n d D e p o s it A c c o I n s u r e d C o m m e r c i a l B a n k s in t h e S ix t h D i s t r i c t (In T h o u s a n d s o f D o lla rs ) Percent Change Percent Change Jan. 1970 From Jan. 1970 From January 1970 STANDARD METROPOLITAN STATISTICAL AREAS*t . 2,011,268 Birmingham . . . . 70,472 Gadsden . . . . 236,079 Huntsville . . . . . 672,506 Mobile ............. . . 386,720 Montgomery . . . . 129,262 Tuscaloosa . . . . . December 1969 January 1969 Dec. 1969 Jan. 1969 2,026,191 75,572 232,575 642,848 414,754 130,569 1,915,657 69,095 210,806 600,148 367,563 130,152 + + - 1 7 2 5 7 1 + 5 + 2 +11 + 12 + 5 - 1 January January____ December _____________________ 1970________ 1969________ 1969 Dec. 1969 Jan. 1969 102,692 149,525 47,497 81,615 29,977 492,041 176,762 1,089,859 86,031 - 3 +14 — 4 + 7 + 2 + 6 + 0 - 1 +14 +15 +27 — 10 +29 - 7 +5 +20 +23 +24 Gainesville ............. 117,729 Lakeland ................ 190,555 Monroe County . . . 42,867 ................... 105,970 Ocala St. Augustine . . . . 27,811 St. Petersburg . . . 518,958 Sarasota ................ 211,768 Tampa ................... 1,343,323 Winter Haven . . . . 106,736 121,746 167,546 44,787 99,014 27,236 490,593 211,410 1,360,474 93,374 Athens ...................... 108,258 Brunswick ............ 60,583 ................... 112,753 Dalton Elberton ................ 16,749 Gainesville ............. 105,835 Griffin ................... 44,215 L a G r a n g e ................ 24,036 Newnan ................ 28,874 ................... 96,742 Rome Valdosta ................ 68,774 118,188 58,159 128,685 17,216 92,984 45,917 25,155 30,066 103,497 67,783 104,144 55,133 125,948 17,155 78,393 39,181 24,876 25,597 88,054 61,332 - 8 + 4 -1 2 - 3 +14 - 4 - 4 - 4 - 7 + 1 +4 +10 -1 0 - 2 +35 +13 - 3 +13 +10 +12 Abbeville ................ Alexandria ............. Bunkie ................ Hammond ............. New I b e r i a ............. Plaquemine ............. Thibodaux ............. 18,134 179,255 9,166 44,979 47,715 18,472 35,321 15,635 181,058 9,012 45,087 47,849 14,730 32,1.03 17,817 185,062 8,825 43,277 46,193 15,983 36,398 +16 - 1 + 2 - 0 - 0 +25 +10 + 2 - 3 +4 +4 +3 +16 - 3 Ft. LauderdaleHollywood . . Jacksonville . . Miami ............. Orlando . . . . Pensacola . . . Tallahassee . . . Tampa-St. Pete. W. Palm Beach . 1,282,452 . 1,980,985 . 4,041,729 856,716 254,932 193,015 . 2,496,828 797,560 1,188,891 2,117,522 4,077,135 865,205 289,451 199,410 2,431,998 714,643 1,158,492 1,997,372 3,593,128 743,190 240,740 169,043 2,165,087 668,973 + 8 - 6 - 1 - 1 -1 2 - 3 + 3 + 12 + 11 - 1 +12 +15 + 6 + 14 +15 + 19 Albany ............. Atlanta . . . . Augusta . . . . Columbus . . . Macon ............. Savannah . . . . 124,207 . 7,708,432 327,949 282,919 332,604 357,495 125,157 8,044,201 344,707 294,697 376,178 382,427 113,770 6,456,435 309,357 272,884 312,516 341,512 - 1 - 4 - 5 - 4 -1 2 - 7 + 9 + 19 - 6 + 4 + 6 + 5 Baton Rouge . . Lafayette . . . . Lake Charles . . New Orleans . . 891,666 184,699 192,231 . 2,974,312 793,071 166,585 180,997 3,015,465 665,322 189,446 193,125 2,820,470 + 12 + 11 + 6 - 1 + 34 - 3 - 0 + 5 158,581 864,755 173,542 854,612 132,737 759,490 - 9 + 1 + 19 + 14 Hattiesburg ............. Laurel ................... Meridian ................ Natchez ................ 58,595 55,295 85,509 NA 60,282 52,430 84,156 NA 71,718 40,305 81,213 NA - 3 + 5 + 2 NA -1 8 +37 +5 NA 871,470 586,013 1,897,973 881,706 630,543 2,110,042 766,233 600,216 2,443,931 - 1 - 7 -1 0 + 14 - 2 -2 2 Pascagoula— Moss Point . . . . Vicksburg ............. Yazoo C i t y ............. 79,896 51,457 26,881 94,010 49,547 27,487 83,931 48,694 34,670 -1 5 + 4 - 2 - 5 +6 -2 2 80,379 89,184 50,983 83,594 89,153 59,501 77,813 79,751 51,467 - 4 + 0 -1 4 + 3 + 12 - 1 Bristol ................... Johnson City . . . . K i n g s p o r t ................ 94,967 103,101 172,872 103,996 107,797 189,825 91,008 94,619 186,410 - 9 - 4 - 9 +4 +9 - 7 49,175 114,391 269,981 117,082 46,067 107,654 272,604 106,312 50,921 121,804 286,893 106,974 + 7 - + 6 - 1 + 10 - 6 - 6 146,096 142,282 145,207 + 3 + 1 SIXTH DISTRICT, Total . A l a b a m a * ................ F l o r i d a ! ................... G e o r g ia !................... Louisianat* ............. M is s is s ip p it* ............. T e n n e s s e e t* ............. 44,339,165 5,201,051 15,232,468 11,485,262 5,362,228 1,926,278 5,131,878 + + + - +9 +6 +12 +15 +9 +12 - 9 Biloxi-Gulfport Jackson . . . . Chattanooga . . Knoxville . . . . Nashville . . . . THER CENTERS Anniston . . . . Dothan . . . . Selma ............. Bartow . . . . Bradenton . . Brevard County Daytona Beach Ft. MyersN. Ft. Myers ♦Includes only banks in the Sixth District portion of the state M ARCH 1970 3 + 9 tPartially estimated ^Estimated 45,075,662 5,253,868 15,153,705 11,938,671 5,243,153 1,921,707 5,564,558 40,802,215 4,899,474 13,628,151 10,017,696 4,913,879 1,720,909 5,622,106 2 1 1 4 2 0 8 r-Revised 47 D is t r ic t B u s in e s s C o n d it io n s The pace of economic activity continues to moderate. Except for large projects, the construction picture remains bleak. Consumer instalment credit posted a slight decline in January. According to early reports, however, employment is holding up better than nationally, despite w eakness in some areas. Higher interest payments on time deposits have helped reverse earlier deposit outflows, but bank lending activity has moderated. Higher livestock prices were countered by declining crop prices. In terms of dollar aggregates, construction contract awards in January continued extremely strong because of awards for large utilities, factories, office and bank building, and Florida apartment projects. T h i s b o o m i n t o t a l d o l l a r sta tes c o n s tr u c tio n m e n t a t L o c k h e e d -G e o r g ia c o n t in u e s to fa ll o ff. n ess in v o lu m e r e s id e n tia l m a sk ed a b u ild in g c o n tin u in g in m any so ft According to preliminary January returns, nonfarm employment, although soft in some areas, is holding up better than the national average. E m p lo y m e n t g a in e d in fo u r o f th e fiv e D is t r ic t r e p o r tin g . In th e A tla n ta area, e m p lo y cen ters. B u ild e r s a n d m o r tg a g e le n d e r s r e m a in p e s s im is tic a b o u t h o u s in g p r o s p e c ts fo r 1 9 7 0 . T h e r e c e n t tr e n d to w a r d lo w e r in te r e s t r a te le v e ls in som e Most member banks quickly posted the higher time deposit interest rates permitted by recent regulatory changes. M e m b e r s b a n k s o u t s i d e o f se c to r s o f th e m o n e y a n d c a p ita l m a r k e ts h a s n o t la r g e c it ie s w e r e a b le to e x p a n d th e ir v o lu m e o f yet S a v in g s tim e d e p o s its in F e b r u a r y ; fo r th e o th e r b a n k s, r e m a in o u tflo w s s to p p e d . B a n k le n d in g g e n e r a lly h a s c o n flo w s p erm ea ted to th e m o r tg a g e m o r tg a g e le n d in g m a r k e t. in s t itu t io n s s tu n te d a n d m o r tg a g e c r e d it a v a ila b ilit y s e v e r e ly tin u e d to a b a te s e a s o n a lly , b u t s o m e c a te g o r ie s r e s tr ic te d . of b u s in e s s le n d in g have d e c lin e d m ore th a n u s u a l. Early in the year, consum ers used instalment credit from commercial banks more sparingly. January co n su m er c r e d it o u ts ta n d in g f e ll fro m Average prices received by farmers advanced in February. T h e r i s e p r i m a r i ly r e f l e c t e d a n u p t h e p r e v io u s m o n t h b e c a u s e o f r e d u c e d n e w lo a n w ard v o lu m e a n d in c r e a s e d r e p a y m e n ts . E s t im a t e s a r e u s u a lly m ovem ent lo w in c itr u s January th a t a n n u a l d e p a r tm e n t sto r e s a le s in m a jo r m e t h e ld r o p o lita n a r e a s h a v e in c r e a s e d s lig h t ly le s s , p e r o ffse t c e n t a g e w is e , d u r in g 1 9 6 9 th a n in s p it e o f th e r is e in 1968. T h e A t la n ta r e ta il fo o d p r ic e in d e x c o n tin u e d it s u p w a r d in d e x p u s h in J a n u a r y . p r ic e s le v e l. s te a d y a s d e c lin in g e g g a n d p r ic e D ata on w h ich s ta t e m e n ts a re b a se d 48 h av e b e e n a d ju s te d at its fo r hogs of an un liv e s to c k b r o ile r p r ic e s and c a ttle . In c itr u s p r ic e s , t h e t o ta l c r o p 1967. NOTE: w as advances fr o m P r ic e s w h e n e v e r p o s s ib le lo w e s t to F ebruary e lim in a te seaso n al le v e l s in c e in flu e n c e s. MONTHLY REVIEW MARCH 1970
