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Atlanta, Georgia November • 1958 Ifc -v A ls o i n •III f : t h is is s u e : fa rm ers m o r e pro spero u s M 1958 the b u i l d i n g p ic t u r e SIXTH DISTRICT BUSINESS HIGHLIGHTS SIXTH DISTRICT STATISTICS SIXTH DISTRICT INDEXES The Other Side of the Question Where District Manufacturers Get Funds For Expansion I n asking, “How is the industrial expansion in the South being financed?” we are reminded of the old saying, “There are two sides to every question.” This question can be answered from the side of the users of funds, but generally we look at it from the standpoint of those who supply them—financial institutions, such as banks, insurance companies, security dealers, and others. They have complete financial records and their operations can be closely observed. Seeking the answer entirely from the side of the suppliers of funds, as we have done from time to time in the pages of this Review, may possibly have yielded a distorted picture. It may be desirable, therefore, to look at the question from the side of the users of funds. The best way of doing this would be to go directly to manufacturing firms that have built new plants or that have added to them in recent years and ask how they got their funds. This we did. We chose for our survey the experience of manufacturing firms from 1956 through mid-1958. From information gleaned from the press, from construction contract listings, from state industrial develop ment agencies, from power companies, and from other sources, we assembled statistics on manufacturing expansion projects costing $100,000 or more each. In the states in the Sixth Federal Reserve District there were, of course, many projects costing less than this amount. There were, too, some for which our sources gave us no in formation. The information we did get, however, probably represents fairly well the expansion of manufacturing firms during that period. Finding part of the answer was relatively easy after we had classified the firms into Southern firms and into those having home offices and operations in other sections as well as in the Sixth District. We found that these latter national concerns accounted for 90 percent of the total expenditures, and for them the answer was obvious: Funds for expan sion were supplied through their home offices. There was no reason to believe that the sources of funds for expan sion by national concerns in the Sixth District were different from those of such concerns elsewhere. We therefore made no further study of national firms except to note that they were especially important in certain industry groups, such as chemicals, petroleum, and pulp and paper manufacturing. In other industry groups, however, there have been numerous expansions by Southern firms that have contributed greatly to the economic growth of the South. To many a community, the expansion of local industry has been extremely important; in many instances it has been a multi-million-dollar affair. We asked the Southern firms certain details as to how they financed their expansions. About three-fifths of them responded to our questions. Thus, we have a fairly representative sample of the way in which manufacturing concerns in the South have been financing their expansions since 1956. Some of the firms told us that they needed no outside help at all; they had enough internal funds to pay for the new building, to remodel the old one, or to purchase machinery and equipment. These firms, about 15 percent of the total number, were only half as numerous as those that used no internal funds at all and relied entirely on external funds for financing. The greatest number, how ever, used some of their own funds but also got funds from outside the business. other sources—financed only about 30 percent of the total cost of their expansions. This apparently means that internal funds are less important to firms in our District than to firms in other sections, but it is principally because our survey covered mostly small firms. The large firms in the District relied on internal funds much more extensively than did the small ones. The tendency of small business generally to seek debt rather than equity financ ing was confirmed by the survey. Equity capital in the form of stock issues was the source of only a fifth of ex ternal funds for expansion. Diversity in External Financing Banks Most Important Source As shown by their replies, expanding firms acquired ex ternal funds in a wide variety of ways. In one case, the firm, although a corporation, was owned entirely by one man. The “external” funds were secured merely by trans ferring some of the man’s private funds to the corpora tion. Few cases, however, were that simple. A firm in the stone, clay, and glass manufacturing group, for example, was able to pay about half the cost of its expansion from its surplus and reserves. The other half came from several banks in the form of five-year loans. Some of the banks were located in the same city as the manufacturer; others were in a neighboring state; still others were in New York. An even more complicated transaction was initiated when a firm located at one end of the Sixth District de cided to close down its old factory, sell the building, and move to more modern quarters at another location. It found a private investment company that was willing to build the plant, using money that came from outside the South, and then arranged a long-term lease. This firm used its own funds to buy some of its new equipment, but paid for part of it by signing a long-term chattel mortgage in favor of the firm that made the machines. The local bank provided whatever short-term financing was needed. In Florida, a much smaller manufacturer began busi ness with equity capital secured by selling stock locally. A mortgage placed with an individual outside the South paid for some of the equipment and a loan from a Florida insurance company paid for the building. Some of the equipment was bought on credit. A food manufacturer with a long record of production in one of the District cities found financing from the ordinary sources difficult even though he needed to ex pand to keep up with growing sales. He needed all his internal funds for working capital and his financial state ment made it hard to secure funds through ordinary chan nels. He finally secured some of his financing by placing a participation loan through his bank with the Small Business Administration. In Alabama, Mississippi, and Tennessee, where legisla tion has authorized the practice, some manufacturers have acquired buildings that were financed by the sale of city or county bonds. An arrangement to repay monthly over twenty years, at which time the building might be pur chased for a nominal sum, is fairly typical in such cases. Although the financing of each industrial expansion may seem to have been unique, a general pattern emerges when we consider the firms as a group. For one thing, they required large external funds. Internal funds—those ob tained from earned surplus, depreciation reserves, and Although the number of firms using bank credit was greater than the number using other credit, not quite half of the total amount of their external funds was obtained in this way. Three out of every four firms em ploying fewer than twenty-five persons resorted to banks. That 78 percent of the loans extended were for terms of more than a year confirms the growing tendency for banks to extend intermediate and long-term credit re vealed by recent surveys of the banks’ loan records. Although most of the term loans ran from one to five years, there were instances when credit was extended for ten years or more. Loans made by insurance companies, although much less important than bank loans, were made for longer terms—over half being for ten years or more. Loans made by individuals (included in the “other” group in the table) were also made for longer periods than bank loans. Credit from suppliers, also included in the “other” group, was generally extended for from one to five years. Bond financing was used by about 15 percent of the firms. The funds secured in this way made up about 18 percent of the external financing. Some of these bond issues were marketed through underwriters, but most of them were placed directly with individuals as we have found from other studies. We have included in the total those issues floated by counties and municipalities for the purpose of financing industrial building under the legisla tive authority, although they account for only a small part of the total. Expansion Attracts Funds From Other Regions *|ip Recognizing the economic opportunities inherent in ui South’s physical and human resources, many of the na tion’s major corporations have invested heavily in nj'w manufacturing facilities in the South. In addition, as this s u r v e y shows, the nation’s investors have recognized the strength of these economic factors by putting their fun s at the disposal of Southern businessmen to use for indus trial expansion. In the period from 1956 through mi 1958, about three-fifths of all external funds used for industrial expansion by the local firms that were s u r v e y e came from outside the South. One out of every five fir018 used some form of non-Southern financing. Because the amounts they needed were large and so were frequently beyond the capacity of local lenders, an because their requirements fitted into the in vestm en t po cies of the large financial institutions, the larger firms • 2 • FINANCING OF PUBLICLY ANNOUNCED NEW MANUFACTURING PLANTS AND EXPANSIONS COSTING $100,000 OR MORE Sixth District, 1956 - Mid-1958 too occasionally secured funds from outside the South. Banks supplied 55 percent of all the expansion funds obtained by Sixth District firms from outside the South. More bank credit, indeed, came from outside the South than from within it. Nevertheless, only 17 percent of the District firms using bank credit got it from non-Southern banks. The survey, of course, excludes bank credit for working capital, which is supplied largely by local banks. Substantial sums were also obtained from outside the South through the sale of stocks and bonds and the use of trade credit and from insurance companies. Eipontion by O istrict firm * os percent of totol 20 30 40 50 60 Was Financing Adequate? Ike cost of new manufacturing plants built or expanded by Sixth District firms has been small compared with that by national firms, but four out of every ten projects w ere under taken by District concerns. Percent of totol cost fmonced 00 — *rWT* eiternol sources A L L S IZ E S L e t t 'hon 100 1 0 0 -4 9 9 tin SOO and ov«r Th* major part of the funds came from external sources, with smaller firms more dependent on external funds than the larger ones. P»rc*nf of (Dial finoncing from M ch ar«a 20________________ 4 0 ________________ 6 0 C«»lQTiim ii S i n A LL S IZ E S L* » l than 100 1 0 0 -4 9 9 500 and over Funds from nonlocal sources w ere especially importar •■rger firms. Percent of total financing from Other Southern States Areas Same State Types Bank Loans ..................... Insurance Companies jrtock Issues . . . . Bond Issues..................... Other, inc. Trade Credit and In d iv id u als 18 35 7 30 17 — 55 2 18 22 11 11 28 3 100 100 100 100 48 3 20 . . . . All T y p e s ........................ Outside South 57 1 14 Banks w ere the most important source of funds both within and •■♦side Hie SoutK. secured more funds from outside the South than they did from within the Sixth District. Small firms, on the other hand, more frequently drew funds from other Southern states when they did not secure them locally, but they Our survey of firms that succeeded in financing the build ing or expanding of their manufacturing plants tells us nothing about the firms that could not carry out their plans because of their inability to finance them. Of those who did get financing, about nine out of ten told us that their expansion was not limited by any difficulty in ob taining the necessary funds on suitable terms. In the words of one manufacturing executive, he was able to get “all the money we have any business borrowing.” Even though many of these firms went far beyond the boundaries of their own territories to secure funds, they apparently be lieved that available financing was adequate. On the other hand, about one out of ten of the firms covered by the survey told us they had difficulties get ting financing. One businessman complained that because of a delay he had to refuse business that amounted to more than the capital expenditures needed but which he eventually obtained. Another executive reported “great difficulty with banks.” Still another concluded, “If I could call back 10 percent of the time I’ve spent in conference with financiers and apply it to direct selling of small lots of stock, I would probably have all the financing that a dozen small firms could use.” We would need to look at the question of adequacy from the side of the supplier of funds before we could judge whether these complaints are justified. However, as one manufacturer has suggested, the difficulties may come partly from choosing the wrong method of financing and requesting funds from the wrong source. Most of the firms that had financing difficulties are small and to many small businessmen, as one manufacturing executive told us, “the red tape and controls involved in securing funds are a businessman’s nightmare.” The banker who points out alternative sources and guides the seeker of funds through the complexities of negotiations can sometimes secure adequate financing for industrial expansion in his community, even though he may be unable to provide the funds himself. The records of success in obtaining funds that we have reviewed show that capital funds have been made available from a wide variety of sources in many different ways. It is fortunate for the South that the American economic system places no embargoes on the flow of funds wherever economic opportunity beckons. For this reason, industrial expansion in that part of the South included in the Sixth District has not been limited by the availability of local funds alone. C h a r l e s T . T aylor •3 • Farmers More Prosperous in 1958 Farm families are heartened by their income prospects this year. All together, farmers in the six District states will enjoy gross sales at least 15 percent greater than those in 1957, judging from trends in this year’s harvests and cash receipts. Their net farm income also will be much larger, since total costs are little different from those last year. Farm income is rebounding from an extremely low level caused largely by heavy rains at harvest time last year. Nevertheless it will exceed that in 1956 by about 6 percent. losses from the hard freezes last January. Those with vegetables to sell, however, and some who were able to immediately replant profited from the high prices the freeze induced. For others replanted crops moved to market in early summer with those from other District states, which depressed vegetable prices sharply and lowered income of all District growers. Cash Receipts from Farm Marketings* Sixth District States Cash Crops Bring in More Cash To farmers turning the sod in 1958, the words “cash crops” have real meaning. Not only are the important cropS—peanuts, rice, corn, tobacco, cotton—yielding heavily, but declines in the prices for them are being minimized by the price-support program. Peanut output, so important in South Alabama and South Georgia, was a dismal failure last year; this year, however, it is a third larger. Growers of rice and soybeans—important crops in Louisiana and Mississippi—and of tobacco, which is important in South Georgia, North Florida and Tennessee, are also reaping larger crops. These harvests are boosting income; gains range from 5 percent for tobacco to 30 percent for peanuts. The region’s cotton growers are performing exception ally well this year despite certain handicaps. Their crop will total only 6 percent less than that in 1957— an out put the more remarkable because last spring farmers made large deposits in the Soil Bank and thereby cut their plantings 26 percent below those in 1957. Then too, cold, wet weather hindered crop growth at planting time, but as spring and summer wore on, growing conditions turned favorable and per acre yields mounted to levels well above those in 1957 in all states except Louisiana where heavy rains damaged the crop again this year. High yields will sustain farm incomes because the prospect for the price of cotton is favorable. Farmers can depend not only on the existing price support for cotton but also on firm prices for some grades in short supply. Freeze Damage Boosts Income Paradoxically the freeze last winter that hit hard in Florida, and to a lesser extent elsewhere in the District, boosted farm income. The freeze dealt severe financial blows to some farmers, especially in the northern fringes of Florida’s citrus belt and the potato and vegetable sec tions scattered over central and southern Florida, but for others the cold wave was as a touch from Midas. With the total citrus crop cut somewhat, demand held strong and prices rose sharply. Many citrus growers and the in dustry generally, therefore, obtained larger incomes. This had great impact in Florida, since citrus sales bring in about 38 percent of the state’s farm income. And that is not all: Anticipating a small crop next winter, buyers have contracted for oranges at prices double those quoted when the 1957-58 season began. Many Florida vegetable growers also took severe 0 5 Percent Increase, 1958 from 1957 _______ [0_________ (5________ 20_______ 25 Alabama Florida Georgia Louisiana Mississippi Tennessee Six States •Cash receipts for 1958 estimated by this Bank. Elsewhere in the District the protracted cold wave held fruit and nut trees dormant longer than usual. As a con sequence, yields are exceeding those in 1957. The Georgia peach crop, for example, was virtually doubled. The Dis trict pecan crop has almost tripled and the pear crop has increased by a third. Tung nuts too are in larger supply- Livestock and Poultry Receipts Rise Larger crop receipts are coming on top of rising in(j°inf from livestock and poultry products. Income from bee , for instance, is a fourth greater than it was last year. Farmers sold less beef and pork, but they were well pai for both; prices for beef were 42 percent over the 1 ^ average, and those for pork were 15 percent higher, o all growers profited equally, however. Those who inai tained herds despite low prices in 1953-56 are hi a enviable position; they have animals to sell at exis i high prices. Those who sold out after prices declined a bought back after prices rose are less prosperous n0^ Finally, poultrymen— ever more important among P ducers in our farm economy—have had a good y • True, broilermen obtained a lower average price year than they did in 1957, but they stepped up output 15 percent. Farmers who sold eggs receive higher prices in 1958 and since their volume was on o 15 percent their gross income increased. . ,§ The rise in farm income augurs well for the Distn • 4 • rural areas. Many debts held over from 1957 will be repaid; bank deposits in many places have been bolstered and financial liquidity of banks and other businesses in creased. Thus farmers may move into their 1959 opera tions more confidently. They may express this confidence to some extent by spending a bit more freely for autos, trucks, machinery, and household items this fall and This R ev ie w may be received regularly upon request to the Publications Section, Research Department, Federal Reserve Bank of Atlanta, Atlanta 3, Georgia. A r t h u r H. K a n t n e r The Building Picture Contract Awards Indicate Increased Activity Building activity in the Sixth Federal Reserve District has apparently stabilized in the past five or six months, bring ing to a halt the previous gradual decline from last year’s record level. This is shown by the solid line of the chart on construction employment, which reflects an adjustment to eliminate the fluctuations usually associated with the changing seasons. Because seasonal swings in employment are particularly large in the construction industry, the actual changes in employment, shown by the dashed line in the chart, have been adjusted to reveal the more basic changes in construction activity. Through most of last year building activity remained near the high level reached in January 1957 following a long and steady climb. After about August 1957, how ever, activity dropped more than the usual amount for late year, and seasonally adjusted employment declined through February of this year. Relative stability since that time has kept construction employment at a level about 4 percent below the record of early 1957. While employment figures provide a gauge of overall construction activity, the lack of detail on employment in different types of construction activity prevents our meas uring precisely the changing patterns of activity. More detailed information on building permits and construction contract awards, however, enables us to discern these patterns reasonably well. From this information, it is apparent that stability in the first three quarters of 1957 reflected the approximate balancing of declines in comConstruction Employment Sixtfi District States, 1954-58 mercial and industrial building and gains in home build ing and construction of public works and utilities. For a while in late 1957 and early 1958, the declining segments had the predominant influence, but more recently we have seen stability again result from counter-balancing gains. Since about February of this year an accelerated rise in home-building activity has combined with continued sharp increases in construction of public works and utilities to offset further declines in commercial and industrial con struction. S c e n e Changes from State to State In an area as large and diverse as the Sixth Federal Re serve District, which includes Alabama, Florida, Georgia and parts of Louisiana, Mississippi and Tennessee, one would expect to find differences in construction trends from place to place. The recent period has been no ex ception. In fact, contrasts in building activity among Dis trict states are striking whether one looks only at the last few months or whether one encompasses in his view ac tivity over the past four or five years. Over the longer period Florida and Tennessee show the most striking contrasts. Between 1954 and early 1957 activity in Florida increased over 40 percent to set a new record for the state. A slight dip occurred in late 1957 and early 1958, but since then activity has bounced back to equal the previous record. In contrast, building activity in Tennessee trended downward after 1954, and since about March has been relatively stable at a level approxi mately 25 percent below the 1954 average. If attention is confined to this year, the contrast between Georgia and Louisiana is perhaps most striking. Construction activity has picked up sharply in Georgia, pushing con struction employment above the previous record set in 1956. In Louisiana, however, employment has dropped sharply from the peak reached in late 1957. In Alabama, employment is well below last year’s record, but in Mississippi there has been some pickup from last year. In Georgia, Florida, and Mississippi, increases in both residential and nonresidential construction appear to be responsible for the improvement shown this year. The latest building permit figures show home building is up least in Florida, but the gain there is over a previous rec ord, while home building in Georgia and Mississippi is up from a reduced level. The other three District states have also shown increased home building. With total con•5 • struction employment either steady or moving downward in those areas, this indicates that cutbacks in nonresidential construction apparently have occurred. A Brighter View? Looking again at the District as a whole, where stability has characterized building activity, one naturally wonders what direction construction activity will take over the next few months. Figures on contract awards give us a clue, for they tell the value of contracts awarded for con struction that will get under way in the immediate future and continue for perhaps three or four months in the case of home building and for several more months, or even years, in the case of major projects. Increases in awards are usually followed by increases in construction activity. With this in mind, a glance at the index of construction contracts charted on the back page of this Review leaves little doubt as to the most likely direction of building ac tivity in the Sixth Federal Reserve District. Contract awards have increased at an exceptionally rapid pace this year, hitting new records in mid-summer. Nonresidential awards have shown the largest gains, but residen tial awards have also increased sharply. As the projects involved get under way, therefore, we should see a rise in construction employment. P h i l i p M. W e b s t e r Department Store Sales and Inventories4 Percent Change Place ALABAMA .................. Birm ingham .............. M obile..................... Montgomery.............. Sales Sept. 1958 from Aug. Sept. 1958 1957 —2 +2 — 12 — 10 +5 +3 +9 +6 9 Months 1958 from 1957 — — — — Inventories Sept. 30, 1958 from Aug. 31 Sept. 30 1958 1957 1 2 0 2 +10 +1 +3 —4 +12 — 1 +16 +15 —6 +0 FLORIDA .................. —8 Daytona Beach . . . . — 16 Jacksonville.............. — 11 Miami A r e a .............. —8 M ia m i.................. —9 O r la n d o .................. — 12 St. Ptrsbg-Tampa Area . — 4 +8 +17 +1 +5 +1 +10 +15 +1 — 3 —O +8 -A +7 +7 +4 +9 +9 — 12 +16 +2 +3 —6 +6 +4 — 24 +3 +9 —9 —7 ., +9 —0 +9 +10 —0 +5 +2 +9 — 17 — 10 GEORGIA .................. Atlanta** .............. A u g u s ta .................. Colum bus.................. M aco n ..................... R o m e * * .................. Savannah .................. — 2 — 13 — 17 — 13 +5 — 6 L O U ISIA N A .................. Baton Rouge .............. New O rleans.............. — 10 +1 2 — 14 —4 +5 —5 — 1 —5 +8 +9 +8 — 2 +3 — 3 M IS S IS S IP P I.............. Jackson .................. M e rid ia n **.............. — 2 — 1 +2 +3 +1 +2 — 2 —3 — 1 +3 +1 —6 —8 TENNESSEE .............. Bristol-KingsportJohnson City** . . . Bristol (Tenn. & Va.)** Chattanooga.............. Knoxville.................. —4 +0 —4 +9 D IS T R IC T .................. —7 —9 .. —9 —9 — 1 +0 —5 +7 +11 — 10 — 4 +1 — 0 — 4 +5 +6 +1 +9 — 7 —6 +4 — 1 + 10 — 3 •Reporting stores account for over 90 percent of total District depvtment store sales. **In order to permit publication of figures, a special sample has been constructed t k * fe not confined exclusively to department stores. Figures for noR-department stores however, are not used in computing the District percent changes. Bank Announcement The Federal Reserve Bank of Atlanta welcomes to membership in the Federal Reserve System the National Bank of Sarasota, Sarasota, Florida. The newly organized bank opened for business on No vember 3. Officers are Gilbert N. Parker, Chairman of the Board; Alan M. Cooper, President; W. E. Colson and Dr. A. L. Matthews, Vice Presidents; and L. L. Prince, Vice President and Cashier. Capital stock totals $500,000 and surplus, $400,000. Debits to Individual Demand Deposit Accounts (In Thousands of Dollars) ALABAMA Anniston . . . . Birmingham . . . Dothan . . . . Gadsden . . . . Mobile . . . . Montgomery . • . Selma* . . . . Tuscaloosa* . . Total Reporting Cities Other Citiesf . . . FLORIDA Daytona Beach* . Fort Lauderdale* . Gainesville* . . Jacksonville . . . Key West* . . . Lakeland* . . . Miami . . . . Greater Miami* Orlando . . . . Pensacola . . . St. Petersburg . . Tampa . . . . West Palm Beach* Total Reporting Cities Other Citiesf . . . GEORGIA Albany . . Athens* . . Atlanta . . Augusta . . Brunswick Columbus Elberton . . Gainesville* . Griffin* . . LaGrange* . Macon . . Marietta* Newnan . . Rome* . . Savannah Valdosta . . . Total Reporting Cities Other Citiesf . LOUISIANA Alexandria* . Baton Rouge Lafayette* . Lake Charles New Orleans Total Reporting Cities Other Citiesf . . M ISSISSIP P I Biloxl-Gulfport* Hattiesburg . . Jackson . . . Laurel* . . . Meridian . . . Natchez*. . . Vicksburg Total Reporting Cities Other Citiesf . TENNESSEE Bristol* . . Chattanooga Johnson City* Kingsport* . Knoxville Nashville . . Total Reporting Cities Other Citiesf . , SIXTH DISTRICT Reporting Cities Other Citiesf , ToUJ. 32 Cities . UNITED STATES 344 Cities . . . •Not inctaded hi total fEstimated. Percent Change Sept. 1958 from 1958 Sept. Aug. Sept. from 1957 1958 1957 1957 Sept. 1958 Aug. 1958 36,021 720,825 26,747 31,459 251,015 167,039 24,869 47,110 1,305,085 727,637 36,825 687,919 23,884 31,337 232,070 151,473 20,108 45,548 1,229,164 676,594 34,009 707,946 24,801 34,453 250,644 132,812 24,118 43,216 1,251,999 652,276 53,968 171,544 33,380 647,264 13,762 68,075 726,087 1,087,656 156,066 77,473 152,064 331,644 112,261 2,905,157 1,401,282 54,909 162,301 33,084 622,391 13,020 62,250 681,630 1,029,491 154,263 77,664 131,661 304,166 107,715 2,752,915 1,335,371 48,542 156,471 28,512 583,380 11,964 51,740 631,230 966,065 143,346 78,514 145,829 282,236 91,573 2,588,172 1,229,836 66,159 34,889 1,765,700 94,768 20,154 99,940 8,519 51,936 16,876 17,710 112,926 26,321 15,628 39,664 190,182 25.030 2,586,402 939,817 59,917 34,225 1,635,620 113,103 19,582 92.786 9,152 49,705 16,429 17.786 105,483 26,022 15,211 36,370 168,067 38,333 2,437,791 936,206 56,391 31,366 1,599,561 85,632 21,553 95,085 7,952 46,947 16,005 18,939 106,040 23,674 15.623 39,780 187,303 21.624 2,373,475 863,478 69.030 200,334 57,619 79,371 1,238,821 1,645,175 646,798 64,663 183,546 59,112 80,914 1,165,234 1,553,469 594,898 65,349 190,739 50,219 83,676 1,157,667 1,547,650 596,515 2 —2 +b — —1 +2 +5 -0 +12 +0 ±5 —7 +8 +8 +12 —2 +11 +w + i7 +9 1§ +++4! + +23 +7 +11 +5 +14 + 10 +1 7 +1 +8 +11 n *1} + — 16 +t +2 —— 0 +9 +13 — 35 +10 +3 +J +£ +2 +£ ±1 i $ i\ +11 is a +l -• +(k +0 + 1 *» ~~l +9 +2 +9 +2 +6 +1 ±1 +5 +k +£ +9 +9 + ! +* +1 + i3 +® — 2 -5 +2 + 12 +2 +34 + * * +13 +20 II t£ +53 + 12 t? +20 +1 +4 + 6- +} +? +2 ±2 +5 +* 195,171,000 185,849,000 189,297,000 tar 32 cities tin t are part of the National Bank 6 +9 —5 +4 -0 + 12 36,069 271,184 35,326 70,502 205,556 590,491 1,209,128 529,376 13,384,269 9,311,838 4,072/431 8,007,726 +2 +3 +11 +6 +4 +£ *+ 6 41,726 40,287 294,728 277,416 36,677 38,261 71,635 72,086 215,510 201,759 658,314 649,558 1,320,174 1,277,783 522,458 546,230 14,696,577 13,993,732 9,679,449 10,217,834 4,314,283 4,478,743 8,777,924 8,294,655 • + 10 I +1 5 +32 +15 +1 3 +9 -1 ±J 37,842 29,299 179,915 21,691 35,067 19,432 18,168 341,414 200,950 —9 +26 +3 +9 +4 +11 40,524 31,140 254,718 23,888 40,434 20,224 17,399 428,327 224,984 42,636 32,918 274,894 24,465 40,845 20,604 19,479 455,841 240,751 +9 +10 +24 +3 +6 • # fs +5 - 1 ++ i % + 9 +£ + 10 +2 ii8 X\ +10 +2 Sixth District Indexes Seasonally Adjusted (1947-49 = 100) 1957 1958 SIXTH DISTRICT AUG. SEPT. OCT. NOV. DEC. JAN. FEB. MAR. APR. MAY JUNE JULY Nonfann Employment . . . . Manufacturing Employment . . Apparel........................ Chemicals..................... Fabricated Metals . . . . Food..................... Lhr., Wood Prod., Fur. & Fix. Paper & Allied Products . . AUG. SEPT. 136 121 164 132 189 111 76 161 107 90 248 200 88 297 136 120 166 133 186 112 77 159 105 90 235 198 91 299 135 119 166 131 186 111 78 161 106 89 220 195 85 303 135 118 166 131 185 111 76 159 101 88 220 196 84 299 134 118 164 132 181 111 76 159 100 89 226 194 78 295 134 117 167 130 181 114 75 158 96 88 215 187 82 317 133 115 167 129 177 113 74 156 91 87 200 182 79 325 133 115 165 127 174 110 72 157 91 85 194 183 79 311 132 114 161 131 176 110 72 158 90 85 187 182 74 306 132 113 167 133 176 109 72 157 93 85 172 183 75 297 133 115 170 131 183 109 72 158 91 84 201 192 80 312 133 115 166 131 186 133 115 164 130 183 108 73 158 89 85 212r 198 83 n.a. 133 115 165 127 182 108 75 157 90 85 208 196 89 n.a. 160 330 341 321 104 79 154 176 167 i92r 138 i54r 121 136r 157r 166 274 149r 185 204r 152 160 266 231 147 166 106 164 315 324 308 89 70 152 168r 154 181 134r 147 111 134r 156 141 249r 151 189 205r 151r 160 267 234 144 158 110 167 283 334 241 99 84 158 156 149 187 128 141 102 118 139 136 244 145 177 208 145 160 267 232 138 145 101 161 261 288 239 104 90 152 163 154 205 123 147 115 130 144 143 231 140 195 206 155 161 267 230 136 144 99 175 259 294 229 128 103 172 170 156 201 126 145 117 133 156 149 255 147 207 207 I51r 161 269 240 149 160 113 169 264 272 257 119 97 161 157 151 181 m 142 109 127 146 139 234 132 192 202 151 162 269 245 146 157 111 170 298 293 303 118 92 156 147 147 171 111 128 99 116 128 137 227 135 174 199 125 163 269 233 144 155 112 168 309 279 333 87 160 158 157 175 132 141 97 122 139 148 233 125 186 193 132 166 270 231 139 150 110 162 318 301 332 150 134 177 156 153 164 117 136 99 108 141 151 242 135 181 190 138 168 273 238 141 160 106 164 369 324 406 157 145 176 166 154 172 130 145 107 122 147 159 244 137 203 191 143 170 276 227 141 155 112 167 387 365 405 165 146 184 176 169 199 129 144 106 126 137 165 259 145 202 191 139 174 279 234 147 168 110 127 139 164 268 141 207 192 139r 170 278 241 151 166 116 175 389 394 384 136 118 182 183 183 180 147 161 124 138 156 183 285 147 219 192 151r 176 281 231 148 166 114 184 n.a. n.a. n.a. 136e n.a. n.a. 167p 158 183p 133 150 107 129 151 147 250 139p 209 198 144p 175 282 257 147 161 118 123 113 193 140r 139 221 127 210 122 109 186 133 139 223 83 2 11 123 112 188 129 138 223 88 205 122 112 185 133 138 222 82 1% 121 107 173 132 139 222 111 202 122 105 170 132 140 224 120 205 120 103 162 113 140 223 113 196 120 102 165 122 140 224 128 197 119 103 162 134 145 226 152 201 119 104 166 135 146 230 142 196 119 105 174 128 150 231 147 202 119 106 175 130 150 235 143 205 119 104 177r 145r 154 233 130 203 173 135p 152 234 n.a. 225 180 179 287 175 207 414 144 329 181 177 290 181r 209 417 180 340 179 178 287 151 210 420 165 348 178 180 287 175 212 423 184 332 177 177 288 187 212 425 189 345 176 171 278 161 212 425 162 343 176 171 273 142 211 426 178 325 175 168 264 146 215 431 151 318 176 167 271 153 216 444 239 335 177 171 280 157 221 441 249 320 180 174 292 155 227 447 305 351 182 176 301 156 225 449 214 358 182 182 307 172r 233 456 183 181 311 171 234 457 340 383 129 119 198 150 140 216 90 211 129 118 191 145 141 216 121 219 129 116 186 142 140 215 114 209 128 118 196 149 141 213 127 207 128 117 190 149 142 213 140 215 128 115 183 137 142 213 143 223 126 114 177 113 144 212 141 211 126 113 177 127 147 211 150 203 125 112 171 121 147 212 150 213 124 109 167 139 148 126 113 189 133 146 213 129 126 113r 192 154r 154 127 212 209 125 114 182 136 152 217 167 215 222 157 215 188 142p 155 219 n.a. 238 134 101 173 205r 153 269 133 101 172 180 153 268 132 99 170 132 92 2“ 131 98 169 178 155 270 113 195 130 96 168 193 156 269 £&R.ee*ipts................... 96 69 • isb Sik? ......................... 222 224 131 98 171 177 153 266 116 206 171 171 154 269 96 209 129 95 169 181 157 271 115 208 127 94 166 178 159 272 148 216 127 94 163 177 153 264 143 214 127r 93 168r 179r 157 273 109 205r 127 93 168 184p 155 265 n.a. 240 125 124 125 123 124 126 230r 107 186 334 143 192 125 127r 238r 123r 192 352 127 128 240 185 308 128 183 124 123 226 113 186 337 145 193 118 117 Primary M e ta ls.................. Textiles......................... Transportation Equipment . . Manufacturing Payrolls . . . Cotton Consumption** . . . . Electric Power Production** Petrol. Prod, in Coastal Louisiana & Mississippi** All Other arm Cash Ri Crops Baton Rouge Birmingham Chattanooga Jackson . . Jacksonville Knoxville . Macon . . Miami . . New Orleans Member Bank Loans* . . . . Bank D e b its*..................... Turnover of Demand Deposits* In Leading C itie s.............. jtatsM^LeUin.cltla . . Nonfarm Employment . . Manufacturing Employment Manufacturing Payrolls . . Furniture Store Sales . . Member Bank Deposits . . . . . . . Bank Debits FLORIDA Bank Debits GEORGIA Bank Debits . . ! ! ! ! ' LOUISIANA Nonfarm Em ploym ent.................. 134 Manufacturing Employment . . . . 100 r.fm£acU' in® p« yn X « .................. 172 [urnitun(Store S a le s * .................. 190r .............. 154 member Bank L o a n s * .................. 268 Nwrfarm Em ploym ent.................. 124 Manufacturing Employment . . . . 123 c.!™:acturin» Payrolls.................. 217 Furniture store S a le s * .................. 104 I * * ° « P < » its*.............. 152 Memba-Bank L o a n s * .................. 286 E E S s h * * * ! * ..................... 103 T * a s r ......................... 184 Nonfarm Em ptoym ent.................. 120 Manufacturing Emptoyment . . . . 119 .................. 194 [ urojturestore S a le s * .................. 108 Member Bank D e p o s its * .............. 147 L0" * * * .................. 233 ...................102206 - J » * P « M t s * ............................. ••n ?LSixt* 126 123 212 98r 150 290 53 126 123 206 97 151 293 77 172 177 120 119 191 109r 146 234 120 118 190 101 147 233 207 200 68 92 area only. Other totals for entire six states. basis. "<wfarm and mfg. emp. and payrolls, state depts. of labor; * Mao; elec. power prod.. Fed. Power Com . Other ii 201 153 269 89 206 125 121 205 109 154 295 79 175 119 118 188 108 147 235 96 205 % 172 203 153 270 114 221 125 120 210 126 122 211 119 157 299 107 178 104 164 302 118 116 186 113 147 237 98 206 119 116 179 106 148 239 92 206 ft.*. Not Available. 100 177 12 1 111 212 125 125 207 226 95 172 304 115 173 122 86 166 303 92 176 117 112 179 89 149 238 86 196 p Preliminary. 122 118 113 181 101 155 239 104 200 129 % 221 % 112 178 106 156 242 116 201 e Estimated. 213 157 221 112 179 109 158 245 103 201 117 114 181 104 161 249 113 205 111 73 157 90 84 198 196 81 312 170 420 361 468 134 90 184 174 168 185 127 159 111 101 184 367 138 209 117 114 186 105 156 244 114 206 201 100 202 117 113 192 105 159 250 112 206 119 102 n.a. 112 101 194 359 n.a. 221 117 114 188 104p 158 247 n.a. 220 r Revised. cotton consumption, U. S. Bureau Census; construction contracts, F. W. Dodge Corp.; petrol, prod., U. S. Bureau on data collected by this Bank. Ail indexes calculated by this Bank. O v e r a l l e c o n o m ic a c t i v i t y continued to improve slowly in September, but some fields of activity were still relatively weak. Consumer spending lagged, but other types of spending increased further. Saving apparently continued to grow. Farm income held at levels well above last year. M ember bank loans rose further, and borrowings from the Federal Reserve Bank of A tlanta again increased sharply. Nonfarm employment, seasonally adjusted, was little changed in Sep tember from the preceding three months. Some improvement has occurred over the past few months in both manufacturing and nonmanufacturing employment, but it has not been sufficient to change the employment in dexes perceptibly. After four consecutive monthly increases, factory pay rolls dropped slightly in September as the w orkweek failed to make its usual seasonal gain. The rate of insured unemployment declined sea sonally. Cotton consumption continued upward in September, indicating a fur ther recovery in the cotton textile industry from last April’s low point. Crude oil production was also up further. Steel mill operations remained low in September, but improved substantially in early October. Seasonally adjusted construction contract awards dropped in August after hitting a new record in the preceding month. Sales at department stores, after adjustment for seasonal variation, dropped sharply in September from the record reached the previous month. Preliminary figures indicate a further slight decline in October. Sales at furniture stores, seasonally adjusted, also decreased, but sales at house hold appliance stores rose slightly. Although consumer spending has lagged, other types of spending pushed seasonally adjusted bank debits to an all-time high in September. Savings in the form of tim e deposits at commercial banks and ordinary lif« i*1" surance sales rose more than usual for this time of year. Instalment credit outstanding a t commercial banks rose somewhat less during Sep tember than it has in recent years, reflecting primarily continued w e a k n e s s in automobile credit. Farm income, held at levels well above those last year as indicated by cash receipts from farm marketings, seasonally adjusted. A large out put of important crops and favorable prices for many farm products have sustained overall farm income; an exception is Louisiana where heavy rains severely damaged the cotton crop. The improvement in farm income is reflected by an upward trend in demand deposits at banks in agricul tural areas. It is also reflected, in part, by a further rise in farm realestate values. Member bank loans, seasonally adjusted, rose slightly in September because of increases in all District states except Louisiana and Tennessee. Member bank deposits, however, declined more than seasonally as losses in Alabama, Louisiana, and Tennessee more than offset gains in Mississippi* Georgia, and Florida. Investments at all commercial banks also declined. In October, total loans outstanding at banks in leading cities increased seasonally. Member bank borrowings from the Federal Reserve Bank of Atlanta increased sharply further. Effective October 28, the Federal Reserve Bank of Atlanta raised the discount rate from 2 to 2 ^ percent.
@FedFRASER