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P e a n u ts:
A
C r o p T h a t B e lie s It s N a m e
in t h e S o u t h e a s t
M e e t in g
R e se rve
B a n k in g
N o te s:
D is tr ic t
B u s in e s s
R e q u ir e m e n ts
C on su m e r
C o n d it io n s
L e n d in g
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b y G e n e D . S u lliv a n
Peanuts is an im portant crop in Southeastern agriculture. M o s t of the U. S.
crop is produced within the Southeastern states. In fact, o ne-h alf is produced
on 700,000 acres w ithin A lab am a and Georgia.
The off-farm processing and handlin g of peanuts is a sizable industry
that contributes thousands of jobs to the e co n o m y du rin g the peak
season and generates substantial payrolls w ithin concentrated areas of the
Sixth Federal Reserve District.1
Financing institutions provide several hundred m illion dollars of
credit to purchase expensive m achinery and to cover annual production
and operating expenses of grow ers and processors. In addition, bankers
finance the inventories o f processors for a six-to-nine-m onth period,
extending credit equivalent to about 80 percent o f the crop's m arket value.
The business is m ore than just peanuts in the Southeast.
A t the Farm Level
Peanut production o ccu pied about 1.5 m illion acres in the U nited States
and produ ced over $500 m illion in farm cash receipts in 1972 (see Table 1).
O v e r one-half o f this acreage, nearly 800,000 acres, is located in Sixth
District states, and G eorgia alone accounts for over 500,000 of those acres.
District farm cash receipts from peanuts reached $317 m illion in 1972,
well over one -half of the U. S. total. The peanut enterprise is the largest
single in c o m e -p rod u cin g crop in G eorgia, and it is second only to cotton in
Alabam a. But it is not so im portant in Florida and M ississip pi, the other
p e an u t-p ro ducing District states.
Perm anent Legislation
U nlike producers of m ost other agricultural com m odities, peanut grow ers
have their ow n special governm ent program . It continues from year to
year w ithout renewed authorization from C on gress and is, therefore,
nonexpiring legislation. U n de r this program , as lo n g as producers
vote for m arketing quotas, acreages that can be planted in peanuts are
rigidly controlled. The Secretary o f Agriculture establishes a national
’The Sixth Federal Reserve District includes all of Alabama, Florida, and Georgia and parts of
Louisiana, Mississippi, and Tennessee.
Monthly Review, Vol. LVIII, No. 10. Free subscription and additional copies available
upon request to the Research Department, Federal Reserve Bank of Atlanta,
Atlanta, Georgia 30303.
150
O C T O B E R 1973, M O N T H L Y REVIEW
acreage allotm ent deem ed sufficient to meet the
production quota; this national allotm ent is then
allocated to growers. A producer m ust have an
acreage allotm ent based on historical production.
These allotm ents can be transferred from one farm
to another either through sales or leasing.
Reflecting the profitability of peanut grow ing,
acreage allotm ents have becom e quite valuable.
In early 1973, land sold with an attached peanut
acreage allotm ent co m m a n d e d around $400 m ore
per acre than com parable land w ithout an
allotment.
The C o m m o d ity Credit C orporation guarantees
a price to cooperatin g grow ers that m ay range
from 75 to 90 percent of parity. (Parity is a m athe
matical construct w hich show s the relationship of
the prices farmers receive to the prices they pay
for com m oditie s used in production.) A
guaranteed price at 75 percent of parity m eans
that farmers, by law, receive a price for their
peanuts that is at least 75 percent o f production
input prices. Peanut prices have been m aintained
at the legal m inim um parity level (75 percent) for
the past three years.
Peanut farmers have generally been able to in
crease land productivity through the use of new
te ch n o lo gy at a faster rate than input costs have
|----------------------------------------------------------------------------
CHART I
Sixth District states accounted for over half of
the U.S. peanut crop in 1972.
Other U.S. 4 3 %
N o te :
F ig u r e s re p r e s e n t p e r c e n t of to ta l p o u n d s h a rv e s t e d .
TA BLE 1
Peanuts Harvested For Nuts
Year
Ga.
Fla.
Ala.
District
States
u. s.
2.0
4.0
9.5
10.0
9.5
744.0
754.0
767.5
773.0
775.5
1,451
1,467
1,454
1,486
1,502
600
1,100
1,735
1,600
1,700
1,750
2,060
2,380
2,410
2,280
1,743
2,031
2,066
2,203
2,257
1,200
4,400
16,483
16,000
16,150
1,317,710
1,555,315
1,827,823
1,863,530
1,855,050
2,528,744
2,979,465
3,005,118
3,274,761
3,389,230
$ 192
456
1,418
2,185
$168,403
202,519
240,190
317,395
$321,564
369,883
423,888
518,025
Miss.
Acreage
1,000 Acres
1969
1970
1971
1972
1973
502.0
507.0
510.0
512.0
512.0
53.0
53.0
54.0
54.0
54.0
187.0
190.0
194.0
197.0
200.0
Yield
Pounds Per Acre
1969
1970
1971
1972
1973*
1969
1970
1971
1972
1973*
1,855
2,220
2,490
2,620
2,600
946,270
1,125,540
1,269,900
1,341,440
1,331,200
1,605
2,075
2,590
2,550
2,550
85,065
109,975
139,860
137,700
137,700
1,525
1,660
2,070
1,870
1,850
Production1
1,000 Pounds
285,175
315,400
401,580
368,390
370,000
Cash Receipts
1969
1970
1971
1972
$122,295
142,113
166,810
228,509
$10,684
12,829
19,205
23,807
$1,000
$35,232
47,121
52,757
62,894
Source: USDA, Agricultural Statistics 1972; Crop Production, Sept. 1973;
Farm Income State Estimates, 1959-1972.
♦Indicated
] Not necessarily the product of yield times acres because of rounding and data revision.
FEDERAL RESERVE BANK O F ATLANTA
151
increased; and peanut production, even at prices
set at 75 percent of parity, has continued to be
quite profitable. For example, at the program 's
inception, yields were ranging from 700 to 800
p ou nd s per acre. W ith the use o f output-increasing
technology, grow ers are n ow able to average
yields of w ell over 2000 p ou nd s per acre,
nearly three times production in the 1930's.
Peanut Production and M arketin g
A begin n in g farm er obtains the right to grow
peanuts by either leasing or bu ying peanut
acreage allotm ents from other grow ers w ithin
his county. A llotm ents from several farms may be
c o m bined in one area if a grow er so desires.
It is usually advantageous for a grow er to have his
total peanut acreage within a concentrated area
rather than have several sm all fields scattered
over different farms. In this way, it has often
been possible to transfer peanut acreage from
less desirable to m ore productive land and
thereby increase yields from fixed acreage allot
ments, in addition to the efficiencies resulting
from large scale operations.
Preparing land for planting peanuts involves
about the sam e operations used for other crops.
The application of chem ical herbicides, both
prior to planting and after the plants have
TABLE 2
Estimated Inputs and Variable Costs
of Producing Peanuts
Quantity
Value
Estimated1
Total Cost
District States
(Per Acre)
Preharvest Inputs:
Labor
5.31
Seed
65.00
Fertilizers
7.75
Lime
.167
Power & Equipment 3.09
----Insecticides
----Herbicides
Interest on Money !$56.78
hrs.
lbs
cwt.
ton
hrs.
Total Preharvest Cost
$ 6.22
22.10
11.23
1.29
8.38
6.04
6.08
2.65
$ 4,808,060
17,083,300
8,680,790
997,170
6,477,740
4,668,920
4,699,840
2,048,450
$63.99
$49,464,270
3.91
6.97
10.78
3,022,430
5,387,810
8,332,940
Harvest Inputs:
Labor
Power & Equipment
Cleaning & Drying
Commodity
Commission
3.33 hrs.
2.33 hrs.
.98 ton
.98 ton
Total Harvest Cost
Total Variable Cost
.98
757,540
$22.64
$17,500,720
$86.63
$66,964,990
Source: USDA, Selected U. S. Crop Budgets, Yields, In
puts, and Variable Costs, Volume 1, Southeast
Region, ERS 457, April 1971.
’ Cost per acre multiplied by total acreage of peanuts
harvested in District states in 1972.
152
em erged, has largely replaced w e e d in g by hand
and has also m inim ized cultivation.
Seed is the m ost expensive single item in
peanut produ ction (see Table 2). Fertilization
and disease and insect control through the a p p li
cation o f chem ical insecticides and fu n gicides
are also m ajor expenditures in production.
They have contributed im portantly to increasing
yields per acre. Preharvest expenditures account
for approxim ately three-fourths of ou t-o f-p o cket
production costs.
H arvesting expenses remain significant although
they do not account for as high a proportion
of production costs as once w as the case.
H arvesting techniques have changed drastically
over the past 20 years. There is no longer any
hand stacking o f peanuts or p icking nuts from the
vines by hand. Formerly, harvest began in late
A u gu st and Septem ber and ended around
January; since the advent of m echanical com bines
for picking, harvest is usually com plete within
four to six w eeks after it begins in late August.
M e ch an ize d harvesting techniques have im proved
over time. O rig in a lly harvesting involved d ig g in g
the peanuts or p lo w in g them out of the ground,
placin g them in w in d ro w s for drying to 10- to 12percent moisture, c o m b in in g them, and
eventually b a gg in g and b rin gin g the crop into
receiving points.
N e w te ch n ology n o w elim inates several steps.
After diggin g, the peanuts are allo w ed to dry o nly
for a day or tw o until they reach ab o u t 20
percent moisture, at w hich poin t they are co m b in e d
and brought directly into the sh elling facility
w here m echanical drying further reduces m oisture
content to just under 10 percent. Federal and
state gradin g of peanuts occurs at the sheller,
and the farm er receives paym ent for his peanuts
based on the grade of his crop. The percentage
of sound, mature kernels (SM K ) plays a large role
in determ ining peanut grade and the price received.
A t this point in the m arketing process, the
farmer has the option of placin g his peanuts
under a C o m m o d ity C redit C orp oration (C C C ) loan
or selling outright to a sheller. M o s t usually,
farmers are ready to sell their peanuts at the
time of delivery because only rarely w o u ld
they ever realize a price increase as a result of
storing their crop with the C C C .
Peanuts are usually placed in C C C storage
o nly at the recom m endation of the sheller after
he has received all peanuts for w hich he has
edible markets. G row ers then place their crop
under C C C loan to be kept in w arehouses (typi
cally at the shelter's facilities w hich are rented
to the governm en t for peanut storage). The
grow er ordinarily view s this action as a sale to
the governm ent.
In the event that the sheller foresees his peanut
sup ply for the year running short, he can redeem
O C T O B E R 1973, M O N T H L Y REVIEW
TABLE 3
T o ta l S u p p ly and D isp o sitio n of S h e lle d P e a n u ts
U n ite d S ta te s
Year
Total1
Supply
Exports
Crushed2
Edible
Use
Consumption
Per Capita (lbs.)
------------------------------------------- 1,000 Pounds------------------------------------- 1955
1960
1965
1966
1967
1968
1969
1970
945,726
1,329,856
1,776,937
1,796,708
1,885,587
1,853,202
1,851,037
2,106,556
1,318
57,172
175,221
166,316
148,295
79,623
100,051
213,027
182,534
258,009
373,547
418,292
483,992
491,447
437,127
600,855
595,414
794,596
969,893
947,326
1,004,966
1,031,940
1,062,857
979,467
3.6
4.4
5.0
4.8
5.0
5.1
5.2
4.8
1 Includes stocks, production, and imports.
2 Used as peanut oil and meal.
Source: USDA, Agricultural Statistics 1972.
the am oun t he needs to fill dom estic markets
for edible peanuts from C C C storage. He
w o u ld do this by repaying the loan plus about 5
percent for interest and handlin g charges. Because
m ost shellers m ake slightly over-optim istic
estimates of the peanuts they can sell, there is a
tendency to overbuy from grow ers at the begin n in g
of the season in order to avoid the m ore expensive
procurem ent from C C C at a later date. Thus,
redem ptions of C C C loans on peanuts are rare.
After the sheller purchases peanuts from the
farmer, he begins processing them im m ediately in
order to finish as quickly as possible. Shellers
typically operate their plants five days per week
for a period of five to six months. Ideally, shellers
are finished with processing operations by January,
but quite often the season continues into April.
C o st per unit is reduced if the processing
season is spread over additional m onths because
it serves to keep em ployees on hand perm anently
and it allow s the use of equipm ent to be spread
over a longer time. O n the other hand, if the
harvesting season shou ld stretch m uch beyond
April, the peanuts processed w o u ld be labeled
as old crop and becom e less valuable. A n y
peanuts processed in excess of those for w hich
sales have been m ade are put into cold storage
where they can be kept with little or no dete
rioration. O ld crop peanuts are m ore difficult to
sell, however, as the time of the prospective new
crop approaches.
Peanut Utilization
O f total peanuts used dom estically, about 50
percent are processed into peanut butter, ap
proxim ately 25 percent are consum e d in salted form,
and another 25 percent go into candies.
M o s t peanuts have already been marketed to
m anufacturers well before they are harvested.
The sheller usually markets over the period
FEDERAL RESERVE BANK OF ATLANTA
of a year, based on fall delivery. A n y m arketings
for postfall delivery typically carry som e price
m arkup to reflect carrying charges. Manufacturers,
therefore, try to buy in advance as m uch as
possible to escape these extra charges.
Total U. S. peanut production has, in fact,
rapidly grow n beyond the am ount that can be
used for edible purposes in the U nited States.
Less than 60 percent of the crop is marketed
in edible form dom estically (see Table 3). The
balance of annual production enters C C C storage
under nonrecourse loans to farmers.
O w n e rsh ip of the rem aining 40 percent of the
U. S. peanut crop is eventually taken over by the
C C C and disposed of at bid auction. D om e stic
shellers can and do bid for C C C peanuts, but they
must either crush and process them into peanut
meal and peanut oil (both usually low er-valued
products than edible peanuts)2 or they m ust
export the nuts w ho le to foreign buyers at w orld
market prices.
The W o r ld M arket
A lth o u gh the U nited States accounts for a m inor
proportion o f total global production (see
Table 4), it has reportedly becom e the num ber one
supplier o f peanuts sold for edible purposes
around the w orld. This is largely attributed to
the intensive effort directed tow ards produ cin g
an attractive product for w hich foreigners
have keen dem and. In particular, the attention
that U. S. grow ers have paid to ridding their
product of m o ld disease has assured foreign buyers
o f high quality. D e p e n d ab le quality coupled
2ln mid 1973, the demand for peanut oil and meal had advanced
to the point that the value of processed peanuts approached
the value of peanuts sold for edible purposes. However,
this is not expected to be a long-run situation. An early
realignment of prices to their historical pattern is anticipated.
153
TA BLE 4
W orld A cre ag e and P ro d u ctio n of P e a n u ts
1969
United States
Brazil
Nigeria
Senegal
China Mainland
India
Other
World
Harvested Acreage
— 1,000 Acres-------------------1971
1970
1,451
1,516
3,000
2,370
4,900
17,607
14,416
45,260
1,467
1,375
3,000
2,440
5,190
18,021
14,360
45,853
Production
----------------- 1,000 Metric Tons1969
1970
1,147
754
1,360
800
2,350
5,130
5,144
16,685
1,454
i
3,000
2,718
5,315
i
i
47,244
1971
1,357
800
1,000
875
2,700
5,800
5,611
18,143
1,351
928
775
554
2,650
6,065
5,005
17,328
’ Data unavailable.
Source: USDA, Agricultural Statistics 1972.
with com petitive pricing m ade possible
by export subsidies have substantially increased
the dem and for U. S. peanuts.
A radical change in w orld price patterns has
occurred in 1973 w hich may further affect the d e
m and for the crop. Until recently, prices hovered
around 23.5 cents per p o u n d for edible peanuts
sold in the United States and 11.5 cents per
p ou n d for those sold in w orld markets. By mid
1973, however, the price o f edible peanuts sold
abroad had advanced to about 25 or 26 cents
a pound, even exceeding the dom estic price.
In view of the current w o rld -w id e fo od and
protein meal shortages, industrial spokesm en state
that both the dom estic and w orld market prices
for edible peanuts m ay be about 27 cents per
po u n d in the 1973 m arketing year. In that
eventuality, the price offered to farmers for the
current crop w o u ld be substantially above the
C C C loan rate and the portion of the crop
acquired by the C C C is likely to be sharply
dim inished. Thus, the role o f the C C C and the
cost of the peanut program in 1973 m ay be
drastically reduced.
the peanut program in order to reduce the
governm ent outlay. U n de r norm al market c o n d i
tions, these prop osals w o u ld reduce the profitability
of peanut produ ction to grow ers w h o naturally
resist them.
C o n trib u tion to Off-Farm
Businesses
Peanut program changes that substantially
reduce acreage, however, w o u ld affect m ore than
producers. The e c o n o m y th ro u gh o u t the gro w in g
area w o u ld receive a shock from the drastic p ro
duction curtailm ent likely to ac co m p an y dom estic
prices that are com petitive in the w orld market
over the lo n g run.
The increasing use o f nonfarm inputs also
represents gro w in g sales o f farm supplies by
nonfarm businesses in the peanut area. Table 2
show s that peanut farm ers' annual variable or outo f-p ocket cost for p ro d u c in g peanuts averaged
about $87 per acre in 1970. W ith recent cost
increases, the District's total peanut acreage
could easily incur annual farm produ ction expend-
Program C osts
The governm ent subsidy to peanut grow ers be
com es evident at the tim e o f the C C C auction sale.
Until recently peanuts have been sold at prices
substantially b elo w those paid to farmers w hen
the stocks were acquired, resulting in net losses
to the C C C (see Table 5). Because yield-increasing
te chn ology has boosted production so rapidly
w hile dom estic consum p tion has stabilized, a
larger quantity o f peanuts has been acquired
by the C C C each year and disp ose d of at a loss.
Thus, year by year, until 1973, the peanut
program has been gro w in g increasingly costly
to the G overnm ent.
Projections for increasing losses in the years
ahead have led to proposals for alterations in
154
Year
TA BLE 5
Peanut Price Support Operations
United States 1955-72
CCC Realized
Percent of
Net Loss
Total Per Pound
Price
Under Support
Cents
1955
1960
1965
1970
1971
1972
12.24
10.062
11.20
12.75
13.425
13.95
%
$Million
Cents
20.3
20.5
30.7
36.4
41.3
1
17.1
16.7
44.3
66.3
112.7
105.0*
6.4
5.6
6.4
6.2
8.3
1
’ Data not available.
♦Forecast
Source: USDA. Fats and Oils Situation, November 1972.
Agricultural Statistics, 1972.
O C T O B E R 1973, M O N T H L Y REVIEW
CHART II
itures o f $70 m illion or more. This m oney
represents purchases o f labor, seed, fertilizers
and lime, insecticides, herbicides, fuel, lubricants,
m achinery m aintenance,and repairs. These figures
d o not include purchases o f farm m achinery and
other fixed investm ent items. W h e n allow ances
were m ade for interest and depreciation on fixed
investment, annual costs o f ou tstan din g producers
were reported as high as $215 per acre o f peanuts
produced.
The investm ent in m achinery for each 100
acres o f peanuts am ounts to approxim ately
$100,000 or an estim ated $775 m illion for the
District as a w hole. M o s t equip m e nt is replaced,
on average, about every five years. A lth o u gh
m achinery has som e salvage value, the rapid pace
o f m echanization and increasing prices probably
result in annual m achinery sales to peanut farmers
o f w ell over $100 m illion — a sizable source of
business to District farm m achinery establishments.
Peanut shelling facilities and com plem entary
eq uip m e nt reflect an estim ated investm ent
of at least $50 m illion. Em ployees w o u ld num ber
1750 on a relatively full time basis, running as
high as 6500 du ring peak seasons w hen peanuts are
bein g delivered from farms to receiving stations.
A n nu al payrolls at shelling facilities and receiving
points prob ab ly reach as high as $12 m illion.
Shellers' operating costs are estim ated at $4.7
m illion, covering such items as fuel, bags, and
other m iscellaneous supplies, all o f w hich represent
sales vo lu m es of other area businesses. Charges
for m aintenance, taxes, depreciation, and interest
on investm ent w o u ld am oun t to about $7.5
m illion each season. Thus, d u ring the year, the
off-farm e c o n o m y realizes nearly $25 m illion of
incom e from the operations of peanut shellers
alone.
Figures are not available on the contribution
of peanuts to the business vo lu m e o f various p ro c
essing and m arketing facilities through w hich
they flow after leaving the sheller. How ever,
the various m anufacturers o f peanut butter,
salted peanuts, peanut candies, peanut oil, and
peanut meal, as w ell as the c o m m o d ity brokers and
shippers, u ndo u bte dly also contribute significantly
to the region's e m plo ym en t and business volum e.
Financing the Industry
Financing institutions have a large stake in
each stage o f the peanut production and m arket
ing process. G ro w e r fin ancing accounts for a
m ajor segm ent o f the loan vo lu m e of agricultural
len ding agencies throu gh ou t the peanut belt.
G o vern m e nt price guarantees under the parity
form ula ensure that grow ers' prices alw ays m ove
up with rising input prices. W ith the increasing
yields that peanut farmers have alm ost consistently
obtained, the program has, in effect, ensured
FEDERAL RESERVE BAN K O F ATLANTA
U.S.D.A. projections for continued rapid growth
in CCC losses on peanuts have generated pro
posals for program alterations.
M il.
I
I Crop value
I
I CCC losses
$
1000
600
- 200
n
tL
'6 0
S o u rc e :
'6 5
'7 0
=L
'7 2
Q.
'8 0
'8 5
U S D A , F a ts an d O ils S itu a tio n , N o v e m b e r, 1 9 7 2 .
grow er profits as well. A s w o u ld be expected in
such an industry, there is brisk com petition a m o n g
lending agencies for the peanut producer's
business.
Typical financial arrangem ents include pro
duction credit averaging about $75 per acre, w hich
is advanced in the early spring and is repaid
from crop receipts around Septem ber or October.
Thus, the d ollar am oun t used to finance District
peanut producers' operating capital require
ments for each production season is w ell over
$50 m illion. The interest incom e to lenders
from this loan vo lu m e is quite substantial,
particularly at the high interest rates du ring the
1973 production season.
Farmers' m achinery and equipm ent needs
represent substantial additional capital require
ments that are largely met through borrow ing.
These are interm ediate type loans ranging up to
five years in term. A llo w in g for ow ner's equity
and norm al loan repayments, an estimated $250
m illion of production and harvesting equipm ent
inventory is financed at any given time.
As the harvested crop leaves the farm and
enters the processing channels, the inventories
acquired by the processors m ust also be financed.
Shellers typically use bank credit to acquire
raw product for the co m in g year's processing.
Typical arrangem ents involve bank financing of
about 80 percent o f the peanut inventories'
value. W are h o u se receipts on the stored c o m
m odity serve as collateral for the loan. Thus,
within the Sixth District, bankers extend credit
am o u n tin g to about o ne-h alf the crop's gross
value to finance sheller inventories.
This also has been a relatively safe loan for
the banker because the peanuts are on hand in
on-site storage bins and have been checked by
governm ent crop inspectors and verified to be of
the grade specified. Because shellers usually
acquire only lim ited am ounts o f peanuts in
excess o f current m arketing needs, the risk that
155
they w ou ld be unable to dispose of supplies on
hand at cost-covering prices has been m inim al.
These inventory or c o m m o d ity loans to peanut
shellers have other attractive features to bankers.
Individual len ding limits do not apply to c o m m o d ity
loans, so relatively sm all banks in rural areas
are able to m ake these loans that m ight
otherwise exceed their limits. This credit dem and
com es at the end of the production season,
pro vidin g a use for funds w hen other dem ands
for credit are relaxing.
Bank loans to peanut shellers are not loans to
farmers and are not reported as agricultural
credit. Thus, m any people both in and outside of
the b an king industry are unaw are of this su b
stantial loan vo lu m e that is outstanding from six
to nine m onths o f each year, a vo lu m e w hich is
directly dependent upon agriculture within the
area served by each bank.
Inform ation is not available on the extent to
w hich annual operating expenses of peanut p ro c
essors and m anufacturers are financed. How ever,
it is highly likely that banks also play a m ajor
role in su p p lyin g the capital required for payrolls,
supplies, and inventories at each processing
establishm ent from the tim e the raw product is
acquired until the processed product is sold.
U nquestionably, a large num ber o f business
establishm ents and financial institutions in
peanut areas are dependent on the peanut industry
for sizable portions o f their business. A n y sharp
curtailm ent in production m ight create an even
greater effect in the off-farm e co n o m y than in
the farm sector itself.
S o m e Policy C onsideration s
Regardless of the program 's substantial im pact
in peanut p ro d u cin g areas, the industry may
have to accept som e changes if the pop ulace as a
w ho le feels that the subsidy has grow n too
N O W
expensive. So m e cost-redu cin g program alterations
cou ld be made, short of com pletely a b a n d o n in g
the price support system. Less extreme changes
m ight w ell be weathered w ith little disruption
of the econom y. Evidence o f this possibility is
that considerable acreages o f cotton, soybeans
and feed grains are profitably produ ced w ithin
the p e an u t-grow in g area. That practically
no peanut acreage has been planted to these
alternative crops despite their recent profitability
increase m ay indicate that som e reductions in
support prices and governm en t costs co u ld be
accom p lished w ith o ut m uch decline in peanut
acreage.
From a national standpoint, the justification
for con tin u in g to subsidize the produ ction o f a
crop, a large and gro w in g proportion o f w hich
has been eventually exported at a loss, is subject
to question. A lth o u gh such a subsidy is not
unique to peanut growers, it is true that the
m ajor benefits of the program accrue to producers
in rather concentrated areas, w hile the costs are
shared by the w ho le country.
Farmers in other sections of the country are
reportedly eager to grow additional peanuts
but cannot secure the necessary acreage allot
ments. If they w o u ld be w illin g to produ ce
peanuts at com petitive m arket prices or even
at low er support prices than current grow ers are
w illin g to accept, there w o u ld seem to be som e
justification for allo w in g them to do so.
Som e observers feel that 1973 m arket c o n d i
tions represent a perm anent shift in w orld foo d
dem ands and that the favorable peanut prices
existing in w orld markets are likely to continue.
If that observation sh ou ld prove correct, then U. S.
peanut grow ers w o u ld no longer need costly
governm ent supports to m aintain profits. That
w o u ld be a happy solution indeed to a problem
that otherw ise seem s likely to generate gro w in g
p u blic concern.
A V A IL A B L E
E c o n o m ic
C h a r a c t e r is t ic s
A compilation of Sixth Federal Reserve District statistics based on 1970
Census data and intended to depict local area economic structures on the
basis of trade and banking areas and Standard Metropolitan Statistical Areas.
Single copies available to individuals and banking and educational institu
tions from the Research Department, Federal Research Bank of Atlanta, At
lanta, Georgia 30303.
156
O C T O B ER 1973, M O N T H L Y R E V IEW
M
R
e e t i n
g
R
e q u i r e m
e s e r v e
e n t s
b y W illia m N . C o x , III
All banks must meet reserve requirements. Those which are members
meet their requirements by leaving, at their regional Federal Reserve Bank,
enough funds to equal a stipulated fraction of each bank's own deposits.
Behind this statement lies the reserve calculation process, through
which the Fed and the commercial banks cooperate to ensure that reserve
requirements are satisfied. Since the Fed's ability to use reserves in
controlling national deposit levels depends, in a mechanical sense, on the
effectiveness of this calculation process,1 this article provides a bird's-eye
view of how it works.
Calculating Required Reserves
To be sure of meeting its reserve requirements, a bank has to know the
levels of its own deposits, for it is from these that required reserves are
derived. At the end of every business day, the bank pushes its adding
machine button or quizzes its com puter to see how many dollars of
deposits it owes to its customers. (On days when the bank is closed, it
repeats the previous day's figures.) At the end of each banking week,
which by custom runs from Thursday to W ednesday, the daily totals are
sum m ed and divided by seven to get a weekly average.
Problems do arise, of course. Daily deposit totals, reflecting complex
transactions tailored to the needs of diverse banking customers, often
raise questions about what to include and when. These questions are
usually resolved by published interpretations from the Fed's A ccounting
Department, supplemented by telephone calls or correspondence.
A d d in g the time deposits is usually straightforward. All time deposits
are subject to reserve requirements, and what problems do arise are usually
about bank liabilities similar to large-denomination certificates of deposit. The
bank groups its time deposit totals by type (passbook, etc.), regardless
of w ho holds them.
Calculation of the bank's dem and deposit totals is a bit more complicated,
however. It must distinguish am ong those dem and deposits it
owes to the U. S. Treasury, to other banks, and to other depositors.
1See "C o n tro llin g M o n e y with Bank Reserves," this
FEDERAL RESERVE BANK OF ATLANTA
Review,
April 1973.
157
A C - 7 9 (6 -7 3 )
F E D E R A L R E S E R V E BANK OF A TLA N TA AND BRA N CH ES
REPORT OF DEPOSITS SUBJECT TO RESERVE REQUIREMENTS AND OF VAULT CASH
— F o r M a in ta in e d P e r io d E n d e d _
F o r B ase D e p o sit Pe rio d E n d e d .
7 -3 o
-73
B a la n c e s a t th e C L O S IN G O F B U S I N E S S ea ch d a y sh o u ld b e re p o rte d fo r th a t d a y ; h o w e v e r, S u n d a y and h o lid a y fig u re s a re th e c lo sin g b a la n c e s o f th e p re v io u s b u sin e ss d a y .
(Stated in Nearest Thousands of Dollars)
R E S E R V E
R E Q U IR E M E N T
C A L C U L A T IO N S
DAY
OF
W EEK
T h i s is r e s e r v e a c c o u n t i n g f o r m
Mo. Day
A C -7 9 , fro n t a n d
(a) Dem and Deposits
o f Ban ks
(Item s 7 , and 8
Sch edule E
Report o f C on d itio n )
M illions
Thu.
b u t h y p o t h e t i c a l S ix t h D i s t r i c t m e m b e r b a n k d u r i n g t h e
b a n k i n g w e e k o f J u ly 5 - 1 1 , 1 9 7 3 .
F o r s im p lific a t io n ,
th is
e x a m p le
m e m o ran d u m
o m its
b o th
ite m s s u p p lie d
th e
by
each
b a n k a n d th e m a r g in a l re s e rv e r e q u ir e m e n t s w h ic h a p p ly
to
la r g e -d e n o m in a t io n
c e r t if ic a t e s o f d e p o s i t a n d
to
n o n d e p o s it s o u r c e s o f fu n d s.
Over $2 Million to $10 Million
I (o, 3 9 (d
Over $ 10 Million to $100 Million
- O -
[Thousand s M illions
(Thousands M illions
(Thousands
3. N ET DEMAND
DEPO SITS
(b) Balances S ubject
to Im m ediate W ith
C olum ns 1 (a ). 1 (b)
drawal D ue from
and 1 (c) less colum ns
Other B an ks (Item 2 ,
2 (a) and 2 (b)
Sch edule D
Report o f C o n d itio n )
M illions
(Thousand s
M illions
(Thousands
4. TIM E AND SAVIN G S DEPO SITS
(a) Savings Deposits
(Ite m 1
Sch edule F
R eport o f C on d itio n )
M illions
(b) O th er T im e
Deposits
(Item s 3 , 4 , 6 . 7 ,8 ,
9 , and 10 Sch ed. F
R eport o f C on d itio n )
(Thousands
M illions
(Thousand s
5. V A U L T CASH
(Ite m 5
Sch ed ule D
R eport o f C on d itio n )
M illions
{Thousands
(a 0 0 3 5 O fl3 L
3 a 93
J93
5 95t>
<o 5 0 1
Id ?&>*h
1. The ban k records each d a y 's d e m a n d d e p o sits
clo sin g levels (c h e c k in g a c c o u n t balances) o f
other banks, the U. S. G o v e rn m e n t, and other
d e m a n d dep o sito rs, then a d d s to get seven -d ay
totals for each d u rin g the w e e k o f July 5-11, 1973.
9. o o o
./3&
7 -5
/& o
First $2 Million or Less
.u 'k
M illio n s
(a) Cash Item s in
Process o f C ollectio n
(Item 1
Sch edule D
Report o f C on d itio n )
(BACK)
N E T D E M A N D D E P O S IT S (C o lu m n 3 A C 7 9 )
■i o Vj -
Sch ed ule E
R eport of C o n d itio n )
(c) O th er Demand
Deposits
(Item s 1 , 2 , 5 , 6 , and 9
Sch ed ule E
R ep o rt o f C on d itio n )
th a t date should be show n as zero .
R E Q U IR E D R E S E R V E S
2 .0 0 0
(Thousands
(b) U .S . G overnm ent
Demand D eposits
(Item 4
700/
/340
LoZO A8-5H3 0 5 9 3 732
73M Fri.
U o
/ 0 9 b J 5 ’/22- 7 0 0 5
10 781
AO M
7-(*
757.. 3 0 W
LLO
Sat.
7
0
0
5
'
3
0
9
*
9
5
0
S
/
J
/O
78!
I
096?
77
751
£>bo
7005~ JO
Sun.
/ 0 9 b 5 5 /5JiO 78!
7 5 7 o®
7-X
705/
Mon.
a o is o
7 9 7 . % 4 / 5 IO 741
743
I44i JbW I
7-<?
Tue.
7 '/o
IU 7
7044
209
.553 .£! S 4 7 //
57 K ?
Wed.
?
2
k
o
Q/O
1 3 $ '$
7-//
4^7 3 1 4 4 5
48578 7 0 6 /
(9 5 9 4
Totals
1^ 4 7 0 5 4 9 17P- I 4 C 7i t
4 / <302- 4 m . J I l f M 7 0 2 5 1 5 I8 A .J
If Dem and Deposits are less than the D e d u ctio n s, N et Dem and D eposits on
A V E R A G E BA LA N C ES
AO 7 0 5
740 \
M 3 8 i> 7 0 2 5
b a c k , a s it m i g h t h a v e b e e n f i l l e d o u t b y a r e p r e s e n t a t i v e
s u p p le m e n t a r y
DEDUCTIO N S A LLO W ED
IN COMPUTING R E S E R V E S
|2 .
1. G RO SS DEMAND DEPO SITS
o-
l4 l
SHOULD YOUR TIME DEPOSITS BECOME SUBJECT TO THE
MARGINAL RESERVE REQUIREMENT OR SHOULD YOU INCUR
EURODOLLARS OR OBLIGATIONS OF AFFILIATES OR
SUBSIDIARIES SUBJECT TO RESERVES, PLEASE CONTACT
US FOR THE PROPER REPORTING FORMS.
Over $100 Million to $400 Million
-
•I ?
Q -.
-o -
O
Over $400 Million
2. The bank re co rd s each d a y 's c lo sin g levels o f
uncolle cted cash item s a n d the b a n k 's o w n
d e m a n d b a la n ce s at o th e r banks. These, too,
are totaled o ver the se v e n -d a y b a n k in g w eek.
r*
3 0 1 ?
S A V IN G S
(C o lu m n 4 a A C 7 9 )
• 0 3
x
_______
7026
3. The item s p o ste d in Step 2 are d e d u c te d from
the d e m a n d d e p o sits po ste d in Step 1, y ie ld in g
the net d e m a n d d e p o sits a gain st w h ic h reserve
requirem ents a p p ly ($26,386,000, o n average,
for the w eek). From this figure, the reserves
required aga in st the b a n k 's d e m a n d d e p o sits
($3',048,000) are calculated u sin g the back o f
the report form .
A IL
5000
• 0 3
C o lu m n 4 b A C 7 9 u p to $ 5 M illio n
•0 5
15 1 0 3
x
C o lu m n 4 b A C 7 9 in E x c e ss o f $ 5 M illio n
T O T A L R E Q U IR E D R E S E R V E S
LES S V A U LT CASH
4. The p ro c e d u re o f po stin g, a d d in g , a v e ra g in g and
calcu latin g required reserves is repeated tw ice,
for p a ssb o o k sa v in gs d e p o sits and for oth er tim e
deposits, y ie ld in g average required reserves o f
$211,000 an d $905,000, respectively. T h ese tw o
figures, w h e n a d d e d to the $3,048,000 required
against net d e m a n d de p o sits, indicate the total
required reserves ($4,164,000) the b a n k m u st
h old a gain st its July 5-11 d e p o sit levels. (M a rg in a l
(S u m o f L in e s A b o ve)
(C o lu m n 5)
N E T R E Q U I R E D R E S E R V E S T O B E M A I N T A IN E D A T
FE D E R A L R E S E R V E BAN K
A LLO W A B LE C A R R Y FO RW A RD
(2 % o f T o ta l R e q u ire d Reserves)
158 for FRASER
Digitized
0
;
13
OCTOBER 1973, MONTHLY REVIEW
FEDERAL RESERVE BANK OF ATLANTA
reserve req u ire m e nts o n la rg e -d e n o m in a tio n
C D 's a n d n o n d e p o sit sou rce s o f fu n ds, if a p
plicable, are calcu lated o n a separate fo rm and
in c lu d e d in this total.)
5. V a u lt cash, as reco rded and a veraged by the
b a n k d u rin g the w e e k o f July 5-11, is a llo w e d to
c o u n t to w a rd satisfaction o f reserve requ irem ents
o n d e p o sits held that sa m e w eek.
6. T he re m ain d e r ($3,424,000) c o m p rise s the net
required reserves to be m a in tain e d at the Federal
Reserve B an k o f A tlanta, in the b a n k 's reserve
accou nt. T h is is the level that m u st be met, on
average, d u rin g the w e e k o f July 19-25, tw o
w e e ks later.
7. T h e b a n k can "c a rry fo r w a r d ," into the fo llo w in g
w e e k o f July 2 6 -A u g u st 1, a reserve b a la n ce
excess or d e fic ie n c y o f u p to 2 p e rce n t ($83,000).
159
From its overall demand deposit total, furthermore,
each bank is allowed to make two deductions to
avoid double-counting.
The first deduction is called "cash items in
the process of collection." For the most part,
these are checks which have been written against
customers' accounts, deposited in another bank,
and routed back to the first bank, but which
have not yet been charged against the checkwriter's account. Since these funds have been
added to the depositor's bank account but
have not yet been subtracted from the checkwriter's bank account, they are counted twice, in
two different deposit accounts at two different
banks. To offset this double-counting, the original
bank is allowed to deduct these items from its
demand deposit totals.
The second deduction reflects the fact that
when two banks hold reciprocal demand deposit
accounts with each other, only the net or the
difference between the two reciprocal accounts
is meaningful. So each bank deducts the
deposits it holds at other banks from its daily
dem and deposit total.
At the end of every business day, then, each
member bank records its gross dem and deposits,
"cash item s" deduction, "d u e from other
banks" deduction, and time deposits. It reports
these items weekly to the Fed, generally on
Thursday or Friday after the end o f the banking
week on W ednesday, along with a few other
items of information.2
Accounting for Reserve Balances
Just as in the case of the bank's own deposits,
reserve funds count only if they are on deposit
at the Fed at the close of a business day. (On
holidays and weekends, just as with customer
deposits, the Fed repeats the previous day's
totals. This is one reason why "b a n k " holidays
are coordinated am ong the banks and with
each Federal Reserve office.)
Reserve accounts may show much or little ac
tivity, depending on the size of the commercial
bank and how it uses its reserve account. A
billion-dollar bank, settling transactions on behalf
of m any correspondents and dealing with other
banks around the country, will often show
thousands of transactions each day. A small rural
bank, on the other hand, may show only a
handful o f small transactions.
Reserve account transactions also vary in
nature. Some are payments on credits for checks
deposited through the Fed's check collection
system. Som e are payments for currency shipments
2These reports are also the keystone o f the Fed's
m easurem ent o f national m on ey and deposit totals.
160
between the bank and the Fed. Others are
intercity transfers of funds through the Fed's
wire system, and still others reflect borrow ing
from the Fed through the discount window.
To help each bank keep up with these transac
tions and their effect on reserve balances, the
Fed sends each bank a daily statement, much like
the m onthly checking account statement a
commercial bank provides its customers. In the
Sixth District, a courier delivers this statement
before the bank opens on the follow in g day.
Com paring Reserves Against Requirements
W hen a bank reports its weekly deposit data to the
Fed, it calculates its required reserves on the
back of the same report form. These calculations
involve the follow ing steps:
1. A d d in g dem and deposits owed to other
banks, to the U. S. Government, and to
others to get gross dem and deposits.
2. Deducting "cash item s" and "dem an d deposits
due from other ban ks" to get net dem and
deposits.
3. Calculating the am ount of reserves
required to be held against these net dem and
deposits according to the reserve percentages
established by the Fed.3
4. Calculating the am ount o f reserves required
to be held against reported levels of
savings deposits, again according to the
established percentages.
5. Similarly, calculating the am ount of
reserves required to be held against other
time deposits, including large-denomination
certificates of deposit.
6. A d d in g the three reserve calculations to
determine the total am ount of required
reserves.
For all but a handful of the m em ber banks in
the Sixth District, these steps com pletely describe
the calculation of required reserves.4 But before
the bank and the Fed can make the obvious
com parison of required reserves versus reserve
balances held at the Fed, they must take
account of the fact that vault cash— the am ount
of currency and coin held by the bank itself—
counts toward satisfying reserve requirements.
The am ount o f vault cash held at the close of
each day, a figure the bank has also recorded on
•’ Reserve requirem ent ratios are listed in the m onthly
Federal Reser\'e Bulletin, T able A-9.
4THe exceptions, a few large banks involved in borro w
ing funds through foreign branches o r h o ld in g
com p an y affiliates, m ust calculate and m eet additional
requirem ents against these borrow ings. For details, see
the Federal Reserve Bulletin, June 1973, pp. 445-46.
OCTO BER 1973, MO NTH LY REVIEW
the deposit report, is then subtracted from the
total o f required reserves. The result, the basic
result o f the bank's w eekly report to the Fed,
is the m inim um am oun t of net reserve balances
the bank is required to hold. ("N e t " denotes that
vault cash has been deducted.)
O n c e the calculations are com plete to this
point, all that remains is to see w hether or not the
reserve balances held at the Fed are sufficient to
satisfy the requirements.
There is a lag involved in the com parison,
however. A bank must hold en o ugh reserve
balances at the Fed, on average du ring a particular
week, to satisfy the net required reserves calculated
from the deposits and vault cash reported tw o
w eeks earlier. For example, this m eans that the
deposit and vault cash averages reported by a
bank du ring the w eek of July 5-11,1973, determ ined
the average level o f reserve balances w hich the
bank had to hold at the Fed du ring the w eek
of July 19-25. This tw o-w eek lag aids banks
in m anagin g their reserve balances because the
banker know s for a fact the am oun t o f reserve
balances his bank m ust maintain, on average,
du ring a particular week. It was for this purpose
that the tw o-w eek lag w as introduced in 1968.
For m uch the sam e purpose, another reserve
FEDERAL RESERVE BANK OF ATLANTA
accou nting feature w as also added then: the 2percent carry-over. If a bank's average reserve
balances are w ithin 2 percent of its net required
reserves average, it can m ake up the deficiency
or apply the excess du ring the fo llo w in g week.
(It cannot carry the deficiency or excess m ore
than one week, however.) Like the lagged reserve
feature, the carry-over provision w as designed
to reduce the banks' cost and difficulty of
m anagin g their reserve balances, w ithout obviating
the Fed's ability to use reserves as its instrum ent
o f deposit and m oney control.
W h a t happens if, despite these aids, banks
carry m ore reserves than they need to, or are
deficient? (Excess reserves nationally am o un t to
about $250 m illion from w eek to week.) The bank
pays a self-im posed penalty in the form of foregone
interest, since excess reserve balances earn none.
Banks w hich are deficient in their reserve balances,
on the other hand, m ust pay the Fed a prescribed
penalty equivalent to a rate of interest 2 percent
above the discou nt rate. A deficient bank
becom es subject to the Fed's adm inistrative
scrutiny. If reserve deficiencies are repeated, the
Fed will intensify its scrutiny and can ultimately
invoke legal sanctions against the bank involved.
This is quite rare, however.®
161
Bank
Announcements
August 21, 1973
C A H A B A BANK & TRUST C O M P A N Y
Trussville, Alabama
Opened for business as a par-remitting nonmem
ber. Officers: Samuel J. Lisenby, Jr., president; Lee
W. Ormond, vice president and cashier. Capital,
$375,000; surplus and other funds, $375,000.
September 6, 1973
EXCHANGE BANK OF D U N ED IN
Dunedin, Florida
Opened for business as a par-remitting nonmem
ber. Officers: H. E. Long, president; Carl H.
Keltner, vice president; Charles Jay Marvin, cashier.
Capital, $500,000; surplus and other funds; $500,000.
September 10, 1973
CITIZENS BANK OF BLOUNT C O U N TY
Maryville, Tennessee
Opened for business as a par-remitting nonmem
ber. Officers: Joe Bruce, president; Carl Wyatt,
cashier. Capital, $900,000; surplus and other funds,
$900,000.
September 10, 1973
CITIZENS BANK & TRUST C O M P A N Y
A N D BRANCH
Covington and Mandeville, Louisiana
Began to remit at par.
162
September 12, 1973
BISCAYNE BANK
Miami, Florida
Opened for business as a par-remitting nonmem
ber. Officers: Harry Joe King, president; Gonzalo
J. Menendez, vice president and cashier. Capital,
$875,000; surplus and other funds, $875,000.
September 26, 1973
THE A M ER IC A N BANK OF O RAN G E C O U N T Y
Orlando, Florida
Opened for business as a member. Officers:
William T. Wallis, chairman; J. C. Barfield, Jr.,
president; Thomas W. Gurley, III, vice president
and cashier; T. Robert Richmond, vice president.
Capital, $500,000; surplus and other funds, $500,000.
September 26, 1973
M A R IN E BANK OF PUNTA G O R D A
Punta Corda, Florida
Opened for business as a member. Officers:
John N. Elder, chairman; Aubrey B. Campbell,
president; Kenneth W. Kemmerly, vice president;
Edward E. Phinney, cashier; Theodore J. Zolkos,
assistant cashier. Capital, $500,000; surplus and
other funds, $500,000.
September 27, 1973
AM ER IC A N BANK OF LAKELAND
Lakeland, Florida
Opened for business as a member. Officers:
Jerry R. Hetfield, president; John Teal, vice presi
dent and cashier. Capital, $500,000; surplus and
other funds, $500,000.
O C T O B ER 1973, M O N T H L Y REVIEW
R e c e n t P u b lic a tio n s
AVAILABLE UPON REQUEST
Please address all requests for publications to the Research Departm ent,
Federal Reserve Bank of Atlanta, Atlanta, G eo rgia 30303.
Federal Reserve Policy-Making and Its Problems
A review o f the principal tools of m onetary policy, the problem s faced
by those w h o form ulate policy, and the actions taken by m onetary authorities
du ring the past several years. Published in 1964, this collection o f articles
w as updated and revised in 1972. Single copies are available to individuals
and ban king and educational institutions.
International Finance and Trade: A Southeastern Perspective
A collection of articles w hich covers several institutional aspects of the
w orld m onetary system, describes the grow th o f international trade and banking
in the Sixth District and exam ines som e aspects o f financing eco n o m ic
deve lopm en t in less developed
nations. N o w
available with
these limits:
single copies to individuals; five copies to ban king and educational institutions.
Monthly Review Reprints
Comparative Advantage and the Changing Composition of U. S. Output, Exports
and Imports
John E. Leimone, Septem ber 1973
The Paradox of Bank Reserves
W illiam N. Cox, III, Septem ber 1973
Controlling Money With Bank Reserves
W illiam N. Cox, III, A pril 1973
Member Bank Borrowing: Process and Experience
A rn o ld A. Dill, A pril 1973
The Discount Rate: Problems and Remedies
W illiam N. Cox, III, June 1972
Liability Management Banking: Its Growth and Impact;
Its Practice in the Sixth District
A rn o ld A. Dill, February and D e ce m b e r 1971
FEDERAL RESERVE BAN K O F ATLANTA
BANKING STATISTICS
Billion $
-3 4
■36
•30
32
•26
28
-20
■14
•16
10
Other S e cu ritie s
•8
U.S. G o v ’t. Se cu ritie s
I I I I I I I I I I II I I I I I I I I I I I I I I I I I
J
J
DJ
J
1972
LATEST M ONTH PLOTTED:
DJ
1973
I I I I I I I I I I I I I I I I I II I I I I I I I I I I
J
J
J
1974
DJ
J
1972
DJ
1973
J
1974
SEPTEMBER
‘ F ig u r e s a r e fo r th e la s t W e d n e s d a y o f e a c h m o n th
* * D a ily a v e r a g e f ig u r e s .
S I X T H
C
D I S T R I C T
o n s u m
B A N K I N G
e r
N O T E S
L e n d i n g
E
x p a n d s
R
a p i d l y
Consumer creditexpansion continues.
%
1972
1973*
payment
consumer lending
modernization
loans
consum er goods
‘ D e c e m b e r 1 9 7 2 to J u n e 1 9 7 3 a t a n n u a l ra te
F ig u r e s s h o w n c o v e r a ll S ix t h D is t r ic t m e m b e r b a n k s
164
O C T O BER 1973, M O N T H L Y REVIEW
Southeastern consum ers continue to m ake heavy
use o f bank credit to finance a spen ding spree of
unprecedented size. D u rin g 1972, consum er loans
at m em ber banks grew by 21 percent, or $1.16 b il
lion, the largest dollar increase in consum er lending
ever recorded and the largest percentage increase
since 1950. T hrough the first half o f 1973, consum er
loans at the sam e banks grew at an even higher
annual rate o f 24 percent.
slightly below 1972's slo w rate, perhaps indicating
the Southeast. O f course, changes in this category
are erratic and prom otions by a few large banks
can still strongly influence credit card lending.
Banks throu ghou t the District have show n a
w illingness to expand consum er loans rapidly, but
during the first half o f 1973, G eorgia (up 17 percent)
and Florida (up 14 percent) were clear leaders in
consum er credit expansion in the Southeast. O th er
District states registered gains o f 10 percent or less
for the period. Both G eo rgia and Florida scored
above-average gains in several loan categories, but
G e o rgia's surge in single-paym ent loans and Flori
da's co ntin u in g exceptional strength in m obile
hom e lending contributed a go o d deal to the clim b
in consum er credit for these states.
A lth o u gh District consum er lending accelerated
rapidly in the first half of 1973, the rate of grow th
may be tapering off. Estimates of consum er instal
ment credit outstanding, seasonally adjusted and
based on a sam ple of m em ber and n on m em ber
banks, sh ow grow th in instalm ent credit m ay have
reached a peak in M arch 1973, tapering off in the
fo llo w in g four months. N e w loan extensions
d ropped only slightly in the second quarter, but
repaym ent of previously existing debt accelerated.
As a result, the rate o f grow th in total consum er
credit outstanding m oderated slightly from its earlier
torrid pace.
The series on w hich that estimate is based, C o n
sum er Instalm ent Credit O u tstan d in g at C om m e rcial
Banks in the Sixth District, is published m onthly
by this Bank. It is calculated from data supplied by
a sam ple of all com m ercial banks in the Sixth D is
trict. Benchm arked to the june 1971 Reports of
C ondition , the new Sixth District data were p u b
lished begin n in g in April 1973. Benchm arking the
series resulted in an upw ard revision of approxi
mately 20 percent. In addition to ben chm arkin g the
series, a change in definitions w as initiated, m aking
all categories of data published by the Bank for the
Sixth District com parable to categories published
by the Board of G overnors of the Federal Reserve
System for all com m ercial banks in the United
States. Beginn in g in April 1973, bank credit card
loans were included in the category "O t h e r C o n
sum er G o o d s " and consum er len ding m ade through
check credit plans w as added to the category of
"Personal Loans." Prelim inary data published by
this Bank are n ow revised m onthly, and these re
visions m ake the Sixth District com m ercial bank
consum er loan data directly com parable to the
consum er loan data for com m ercial banks published
by the Board o f Governors. Prior year data are
available from this Bank upon request.
that this particular b an king market has m atured in
BRIAN D. DITTENHAFER
A s usual, bo rrow in g follo w ed the pattern set by
spending. The current bo o m in consum er bu ying
began in the auto sector and did not spread to other
consum er go o d s until late in 1972. F ollo w in g that
pattern, consum er credit grow th in the first half
o f 1972 w as paced by auto lending; nonauto
b o rro w in g did not pick up until late in the year.
D u rin g 1973, however, nonauto bo rro w in g is nearly
m atching the fast rate set by autos.
Bo rro w ing to finance m obile hom es slow ed from
last year's 30-percent rate o f gain; but for the first
six m onths of 1973, such len ding was gro w in g at the
still substantial rate of 25 percent. This im portant
category m akes up an increasing portion of total
c onsum er loans in the Southeast, as it does in the
nation. In the D e ce m b er 1972 Reports of C ondition ,
m obile hom e financing m ade up 9 percent of D is
trict m em ber bank consum er loans and 7.2 percent
of the U. S. m em ber bank total. D u rin g 1972, m obile
hom e financing grew faster in the nation (36 per
cent) than in the District (30 percent), as banks in
the rest of the nation fo llow ed the District's, lead
in this gro w in g and profitable len ding activity.
Single-paym ent loans are the District's largest
single consum er loan category and were a m ajor
factor in overall consum er credit grow th here. In
the first half of 1973, single-paym ent loans grew at
an annual rate of 26 percent, far surpassing the 1972
rate of 19 percent. Loans to repair and m odernize
h o u sin g and personal loans have both increased
at an annual rate of 22 percent du ring the same
period, slightly less than the 24-percent average
increase for all consum er lending. Personal loans
are just m atching 1972 gains, w hile repair and
m odernization loans are reb ou n din g from last year's
sluggishness.
The grow th rate o f len ding through chargeaccount credit plans continued to slow in 1972.
Lending in this category expanded at an unsustain
able rate in the late 1960's as bank credit cards were
introduced in m uch of the Southeast. The annual
rate of increase for the first six m onths o f 1973 was
FEDERAL RESERVE BAN K OF ATLANTA
165
S i x t h
D i s t r i c t
S t a t i s t i c s
S e a s o n a l l y A d ju s t e d
(A ll d a ta a re in d e x e s, u n le s s in d ic a t e d o th e r w is e .)
L a te s t M onth
O ne
M onth
Ago
Tw o
M o nth s
Ago
O ne
Year
Ago
S IX T H D IS T R IC T
U n e m p lo ym e n t R a te
(P e rc e n t o f W o rk F o r c e ) ......................... A ug.
Avg. W e e k ly H rs. in M fg. (H r s .) . . . A ug.
IN C O M E AN D S P E N D IN G
M a n u fa c tu rin g P a y r o l l s ...............................
F a rm C a sh R e c e i p t s ......................................
C r o p s .....................................................................
L iv e s to c k
.........................................................
In s ta lm e n t C re d it at B a n k s * / 1 (M il. $)
N ew L o a n s .........................................................
..................................................
R e p a y m e n ts
Aug.
J u ly
J u ly
J u ly
161
217
267
198
161
180
189
191
160
164
239
184
147
167
191
158
. Aug.
. Aug.
6 34
533
686r
5 88 r
661
570
632
469
.
.
.
.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
A ug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
Aug.
125.9
114 .3
111 .9
100.3
109.5
111.1
111.1
1 25 .0
106.4
1 17 .3
110.3
121.5
110.0
127.0
143.8
108.9
130.0
133.6
122.1
131.9
137.0
134.9
100.0
134.4
8 3.8
125 .6
113 .9
1 11 .9
101.1
110.1
111.1
1 11.3
123 .5
1 07 .4
116 .5
1 10 .4
120 .2
108 .9
126.8
141.9
108.3
129.7
132.7
121.9
132.1
136.6
134.2
9 9.3
134.3
8 5.5
124 .9
114.2
112.3
101.6
110 .8
110 .8
111 .2
123.2
107 .0
116.5
110.2
119 .8
111.1
126.6
141.4
107.7
128.8
131.2
121.9
131.3
136.0
134.0
99.2
131.9
8 4.0
121.0
111 .9
110.6
1 02 .0
107 .2
110 .0
110 .0
120.1
105 .4
113 .5
108 .4
115 .2
108.8
120.2
132.6
110.2
124,2
125.1
116.8
125.5
130.1
130.6
100.0
126.5
81.7
. Aug.
3.7
3.7
3 .8
3.9
2 .9
4 0.5
283
288
278
188
82
113
301
245
189
291
297
224
161
310
367
203
193
206
253
288
472
871
462
1.8
4 0.6
242
281
204
187
84
114
292
242
188
286
291
223
161
3 08
352
198
191
206
241
289
452
797
447
1.8
4 0.7
275
308
242
186
80
115
292
244
188
288
296
223
163
308
349
200
192
207
232
2 89
449
7 68
4 54
2.2
4 0 .9
246
305
188
168
86
128
277
237
187
272
290
218
163
298
325
197
187
182
208
268
4 28
720
423
.• A ug.
. Aug.
243
229
238
223
234
218
189
174
. A ug.
. A ug.
. Aug.
198
174
252
198
175
246
195
173
236
171
150
198
. A ug.
. J u ly
159
266
157
205
160
224
148
176
115.8
1 13 .0
117.1
119.9
6 9.9
115.3
112.7
116.5
118 .9
7 2.4
1 14 .6
112 .4
115 .6
115.4
70.1
112.0
110.7
112.6
113.8
7 5.7
.
.
.
.
.
.
.
.
.
.
,
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
Aug.
Aug.
Aug.
Aug.
Aug.
D ec.
J u ly
S e p t.
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
Ju n e
F IN A N C E A N D B A N K IN G
Loan s*
A ll M e m b e r B a n k s ................................
L a rg e B a n k s ..................................................
D e p o sits*
A ll M em b er B a n k s ......................................
L a rg e B a n k s
..................................................
B a n k D e b its * / * *
............................................
166
O ne
Year
Ago
4 .2
4 0.5
4.3
4 0.4
4 .3
4 1 .4
4 .7
4 1 .3
224
190
2 09
219
190
214
2 14
186
205
180
165
182
164
279
164
197
161
214
145
213
144.1
1 48 .4
181 .0
106.1
143 .8
120 .8
148 .2
179 .9
1 13 .8
141.6
119 .6
145 .8
177.7
102 .8
1 3 3 .9
1 1 5 .8
137 .3
1 58 .4
100.1
2 .7
4 0 .9
2 .7
4 0 .8
2 .8
4 0 .9
3.0
4 1 .2
273
230
306
268
230
284
263
2 24
271
2 08
193
230
156
176
159
174
154
178
144
133
121 .2
108 .5
127 .7
127 .5
82.1
121 .9
109.3
127.7
1 25 .9
8 0.9
119 .7
108 .5
1 24 .9
124 .7
8 1 .6
3 .7
3 .8
4 0 .6
3.7
3 9.7
3 .8
4 0 .2
241
183
278
239
185
261
2 32
182
2 64
184
151
206
146
147
159
147
234
140
166
1 13 .0
1 04 .3
1 14 .8
9 3.7
7 5 .9
113 .2
104 .2
115 .0
9 3 .4
7 4 .5
112.7
104 .3
114 .4
9 2.2
7 5 .7
1 10 .9
1 03 .6
1 1 2 .4
9 1 .3
7 3 .3
4 1 .7
5 .6
4 1 .9
6 .2
4 1 .6
6 .0
4 2 .6
2 24
171
191
2 14
172
192
2 14
173
187
166
157
165
183
2 38
182
2 02
182
118
162
2 06
1 22 .3
1 26 .3
1 20 .5
1 13 .3
7 1 .5
1 21 .2
1 26 .4
1 1 8 .9
1 10 .0
8 2 .6
1 21.1
1 2 6 .4
1 18 .6
1 09 .1
8 0 .9
118 .7
123 .7
1 1 6 .4
1 10 .4
7 7.1
F IN A N C E A N D B A N K IN G
M em b er B a n k L o a n s ............................................ A ug.
M em b er B a n k D e p o s i t s ......................................A ug.
B a n k D e b i t s * * .........................................................A ug.
F L O R ID A
M a n u fa c tu rin g P a y ro lls
................................Aug.
Fa rm C a sh R e c e i p t s ............................................ J u ly
EM P LO YM EN T
N o n farm E m p l o y m e n t ......................................Aug.
M a n u fa c tu rin g
.................................................. Aug.
N o n m a n u fa c tu rin g
......................................Aug.
C o n s t r u c t i o n ...................................................Aug.
Fa rm E m p lo y m e n t .................................................. Aug.
U n e m p lo ym e n t R a te
(P e rc e n t o f W ork F o r c e ) ......................... Aug.
Avg. W e e k ly H rs. in Mfg. (H rs .) . . . Aug.
121.8
F IN A N C E A N D B A N K IN G
M em b er B a n k L o a n s ............................................ Aug.
M em b er B a n k D e p o s i t s ......................................Aug.
B a n k D e b i t s * * .........................................................A ug.
G EO R G IA
IN C O M E
M a n u fa c tu rin g P a y r o l l s ......................................Aug.
Fa rm C a sh R e c e i p t s ............................................ J u ly
EM P LO YM EN T
N o n farm E m p l o y m e n t ......................................Aug.
M a n u fa c tu rin g
.................................................. Aug.
N o n m a n u f a c t u r in g ............................................ Aug.
C o n s t r u c t i o n .................................................. Aug.
Fa rm E m p lo y m e n t ...................................................A ug.
U n e m p lo ym e n t R ate
(P e rc e n t o f W ork F o r c e ) ..........................Aug.
Avg. W e e kly H rs. in M fg. (H rs .) . . . Aug.
122.6
109.1
1 28.7
1 28 .6
87.1
F ’ N A N C E AND B A N K IN G
M em b er B a n k L o a n s ............................................ A ug.
M em b er B a n k D e p o s i t s ................................Aug.
B a n k D e b i t s * * .........................................................Aug.
LO U IS IA N A
IN C O M E
M a n u fa c tu rin g P a y ro lls
................................Aug.
F a rm C a sh R e c e i p t s ............................................ J u ly
211
EM PLO YM EN T
N o n farm E m p l o y m e n t ......................................A ug.
M a n u fa c tu rin g
...................................................Aug.
N o n m a n u f a c t u r in g ............................................ Aug.
C o n s t r u c t i o n ...................................................A ug.
F a rm E m p l o y m e n t ...................................................A ug.
U n e m p lo y m e n t R a te
(P e rc e n t o f W o rk F o r c e ) ......................... Aug.
Avg. W e e k ly H rs. in M fg. (H rs .) . . . Aug.
6.2
M em b er B a n k L o a n s * ......................................A ug.
M em b er B a n k D e p o s i t s * ................................A ug.
B a n k D e b its * / * *
...................................................A ug.
IN C O M E
M a n u fa c tu rin g P a y r o l l s ......................................A ug.
F a rm C a s h R e c e i p t s ............................................ J u ly
EM PLO YM EN T
EM PLO YM EN T
Tw o
M o nth s
Ago
M IS S IS S IP P I
IN C O M E
N o n fa rm E m p l o y m e n t ................................
M a n u fa c tu rin g
............................................
N o n m a n u f a c t u r in g ......................................
C o n s t r u c t i o n ............................................
F a rm E m p lo y m e n t ............................................
O ne
M onth
Ago
F IN A N C E A N D B A N K IN G
A LA B A M A
M a n u fa c tu rin g P a y ro lls
.........................
F a rm C a sh R e c e i p t s ......................................
M onth
IN CO M E
E M P L O Y M E N T A N D P R O D U C T IO N
N o n fa rm E m p l o y m e n t ................................
M a n u fa c tu rin g
............................................
N o n d u ra b le G o o d s ................................
F o o d ...............................................................
T e x t i l e s ...................................................
A p p a re l
..................................................
Paper
.........................................................
P r in t in g a n d P u b lis h in g . .
C h e m i c a l s ............................................
D u ra b le G o o d s ......................................
L b r ., Wood P ro d s ., F u rn . & F ix
S to n e , C la y , an d G la s s . . .
P r im a ry M e t a l s ................................
F a b ric a te d M e t a l s .........................
M a c h i n e r y ............................................
T ra n sp o rta tio n E q u ip m e n t
N o n m a n u fa c tu rin g
................................
C o n s t r u c t i o n ......................................
T ra n s p o rta tio n
................................
T r a d e .........................................................
F in ., in s ., and re a l e s t. . . .
S e r v i c e s ..................................................
F e d e ra l G o v e rn m e n t . . . .
S ta te and L o c a l G o v e rn m e n t.
F a rm E m p l o y m e n t ............................................
U n e m p lo ym e n t R a te
(P e rc e n t o f W ork F o rc e ) . . . .
In su re d U n e m p lo ym e n t
(P e rc e n t of C ov. E m p . ) .........................
Avg. W e e k ly H rs. in M fg. (H rs .) . .
C o n s tru c tio n C o n t r a c t s * .........................
R e s i d e n t i a l .........................................................
A ll O t h e r ...............................................................
E le c tr ic P o w e r P ro d u c tio n **
. . .
C otton C o n s u m p t i o n * * ................................
Pe tro le u m P r o d u c t i o n * * .........................
M a n u fa c tu rin g P ro d u c tio n
. . . .
N o n d u ra b le G o o d s ......................................
Food
.........................................................
T e x t ile s
..................................................
A p p a re l
...................................................
Paper
.........................................................
P r in tin g an d P u b lis h in g . .
C h e m i c a l s ............................................
D u ra b le G o o d s ............................................
L u m b e r a n d W ood
. . . .
F u rn itu r e an d F ix t u r e s
. .
S to n e , C la y , a n d G la s s . . .
P r im a ry M e t a l s ................................
F a b ric a te d M e t a l s .........................
N o n e le c tric a l M a c h in e ry . .
E le c tr ic a l M a c h in e ry . . . .
T ra n s p o rta tio n E q u ip m e n t
La te st
.
.
.
.
.
Aug.
A ug.
Aug.
Aug.
Aug.
N o n fa rm E m p l o y m e n t ......................................A ug.
M a n u fa c tu rin g
...................................................A ug.
N o n m a n u f a c t u r in g .............................................A ug.
C o n s t r u c t i o n ...................................................Aug.
F a rm E m p l o y m e n t ...................................................A ug.
O C T O B E R 1973, M O N T H L Y REVIEW
O ne
M onth
Ago
L a te s t M onth
Tw o
M o n th s
Ago
O ne
Year
Ago
L a t e s t M onth
O ne
M onth
Ago
Tw o
M o n th s
Ago
O ne
Year
Ago
EMPLOYMENT
U n e m p lo y m e n t R a te
(P e rc e n t of W o rk F o rc e ) . .
A vg. W e e k ly H rs. in M fg. (H rs .)
Aug.
Aug.
4.0
4 0.6
4 .2
4 0.7
N o n farm E m p l o y m e n t .........................
M a n u fa c tu rin g
......................................
N o n m a n u f a c t u r in g ................................
C o n s t r u c t i o n ......................................
F a rm E m p lo y m e n t ......................................
U n e m p lo ym e n t R a te
(P e rc e n t o f W o rk F o rc e ) . . .
Avg. W e e k ly H rs. in M fg. (H rs .) .
F IN A N C E A N D B A N K IN G
M e m b e r B a n k L o a n s * ......................................Aug.
M em b er B a n k D e p o s i t s * ................................Aug.
B a n k D e b its * / * *
..................................................Aug.
236
196
200
225
193
227
2 28
195
2 19
189
172
187
163
164
252
149
152
Aug.
Aug.
Aug.
Aug.
Aug.
122 .8
114.7
127.3
119.7
9 6.3
123.1
114 .8
127 .7
119.7
9 3.2
123.7
115.9
128.0
120 .6
9 2.6
1 1 9 .4
112.3
1 23.4
1 20.8
8 8.0
. . Aug.
.. . Aug.
3.1
4 0.6
3.4
4 0.5
3.0
40.5
3 .5
4 0.8
. Aug.
. Aug.
226
182
205
221
182
191
219
178
198
185
165
166
.
.
■
•
•
.
.
•
•
•
TEN N ESSEE
F IN A N C E A N D B A N K IN G
M a n u fa c tu rin g P a y r o l l s ............................... Aug.
F a rm C a s h R e c e i p t s ............................................J u ly
165
197
202
* F o r S ix th D is t ric t a re a o n ly ; o th e r to ta ls fo r e n tir e s ix s t a t e s
B a n k D e b its * /*
* * D a ily a v e ra g e b a s is
t P r e lim in a r y d a ta
r*R evised
N .A . Not a v a ila b le
Note: Indexes for bank debits, construction contracts, cotton consumption, employment, farm cash receipts, loans, petroleum
production, and payrolls: 1967 = 100. AM other indexes: 1957-59 = 100.
S o u rce s : M a n u fa c tu rin g p ro d u ction e s tim a te d by th is B a n k ; n o n fa rm , m fg . a n d n o n m fg . e m p ., m fg. p a y ro lls an d h o u rs, and u n e m p ., U .S . D ept, of L a b o r an d co o p e ra tin g
s ta te a g e n c ie s ; cotto n c o n su m p tio n , U .S . B u re a u of C e n s u s ; c o n stru c tio n c o n t ra c t s , F . W . Dodge D iv ., M cG ra w -H ill In fo rm a tio n S y s te m s C o .; p e tro l, p ro d ., U .S . B u re a u of
M in e s; in d u s tr ia l u se of e le c . p o w er, F e d . P o w er C o m m .; fa rm c a s h re c e ip ts an d fa rm e m p ., U .S .D .A . O th e r in d e x e s b a se d on d a ta c o lle c te d by t h is B a n k . A ll in d e x e s
c a lc u la t e d by t h is B a n k .
'D a ta b e n ch m a rk e d to Ju n e 1971 R e p o rt o f C o n d itio n
D e b i t s
t o
D e m
a n d
D e p o s i t
A c c o u n t s
In s u r e d C o m m e r c ia l B a n k s in th e S ix t h D is t r ic t
(In T h o u s a n d s o f D o lla r s )
P ercent Change
Percent Change
A u g u st
1973
J u ly
1973
A u g u st
1972
A u g u st
1973
fro m
d a te
8 m os.
J u ly Aug.
1973 1972
from
1972
ST A N D A R D M E T R O P O L IT A N
S T A T IS T IC A L A R E A S * *
B irm in g h a m
. .
G ad sd e n
. . . .
H u n ts v ille
. . .
M o b i l e .........................
M o ntg o m ery
. . .
T u s c a lo o s a
. . .
.
B a rto w -La k e la n d W in te r H aven
D ayto n a B e a c h
F t. La u d e rd a le H o llyw o od . . .
F t. M yers . . . .
G a in e s v ille
. . .
Ja c k s o n v ille
. . .
M elbourneT itu s v ille - C o c o a
M iam i
.........................
O r l a n d o ........................
P e n s a c o la
. . . .
S a ra so ta
. . . .
T a lla h a s s e e
. . .
T a m p a -S t. P e te
W. P a lm B e a c h
D o th an
S e lm a
3 .4 19 ,8 83
9 4 ,7 1 9
3 04 ,5 22
1 ,1 1 4 ,5 9 4
6 4 9 ,5 1 6
2 2 9 ,3 71
3 ,6 6 2 ,8 8 8
9 5,05 9
3 45 ,9 64
1,0 30 ,9 21
6 58 ,3 27
2 1 9 ,6 2 6
3 ,2 01 ,4 83
88,237
2 68,5 23
9 50 ,5 81
51 9 ,2 1 6
175,061
7 7 1 ,1 7 0
5 1 8 ,6 77
8 0 6 ,7 63
46 9 ,9 2 4
6 67 ,1 67
3 1 4 ,7 1 0
1 ,7 9 2 .9 6 9
3 1 0 ,0 6 6
2 5 5 ,1 4 8
4 ,4 7 3 ,7 6 3
1 ,8 37 .5 22
28 8 ,1 3 2
2 4 1 ,6 8 4
3 ,8 5 6 ,6 5 9
4 4 1 ,5 7 4
6 ,9 6 9 ,8 9 9
1 ,7 2 6 ,9 6 7
4 5 8 ,4 4 5
4 9 6 ,2 2 9
1 ,0 39 ,4 37
4 ,0 9 5 ,1 6 1
1 ,2 29 ,5 56
4 2 7 ,9 11
6 ,9 7 9 ,2 9 6
l,5 6 6 ,9 6 1 r
4 3 7 ,2 6 2
5 2 0 ,3 9 2
8 5 5 ,9 2 3
3 ,9 3 0 ,3 9 6
1 ,2 34 ,5 21
A lb a n y
...............................
1 9 7 ,5 82
A tla n ta
. .
16 ,5 6 5 ,1 1 6
A u g u sta
.........................
579 ,6 11
C o l u m b u s ........................
4 4 7 ,2 3 2
M acon
...............................
5 6 2 ,1 26
Savannah
.........................
5 4 0 ,0 88
7
_ 0
—12
+ 8
—
+ 4
+ 7
+ 7
+ 13
+ 17
+ 25
+ 31
+ 19
+ 17
+ 18
+ 15
+ 22
+28
_
4
+ 10
+ 16
+ 65
+ 25
+ 30
1,6 78 ,3 77
2 2 2 ,4 3 8
2 1 1 ,9 6 0
3 ,3 4 9 ,0 6 4
2
+ 8
+ 6
+ 16
+ 7
+ 39
+ 20
+ 34
+ 15
+ 35
+ 23
+24
3 2 9 ,5 6 6
5 ,0 5 0 ,9 0 7
1 ,2 4 1 ,7 3 0
3 8 7 ,2 39
33 5 ,3 2 6
6 6 1 ,2 3 9
3 ,0 4 6 ,9 9 8
8 3 8 ,0 6 3
+ 3
— 0
+ 10
+ 5
— 5
+ 21
. 4
0
+ 34
+ 38
+ 39
+ 18
+ 48
+ 57
+ 34
+ 47
+ 28
+ 29
+25
+ 12
+48
+46
+26
+ 38
187 ,1 76
1 5,28 0,48 7
520 ,4 11
4 3 1 ,5 6 9
5 4 0 ,3 15
5 3 7 ,7 83
164,120
11,41 1,78 1
4 6 5 ,4 6 5
3 9 4 ,3 4 3
4 5 9 ,5 1 2
4 5 9 ,8 0 6
+ 6
+ 8
+ 11
+ 4
+ 4
+ 0
+ 20
+ 45
+ 25
+ 13
+ 22
+ 17
+ 19
+ 42
+ 19
+ 11
+ 19
+ 19
4
A le x a n d ria
. . . .
B ato n R o uge
L a f a y e t t e .........................
L a k e C h a r le s
. . .
New O rle a n s
. . .
2 52 ,0 73
1 .3 25 ,2 93
2 7 5 ,0 4 6
228 ,6 81
4 ,1 9 7 ,2 1 8
2 5 9 ,9 1 9
1 ,4 13 ,5 81
2 7 6 ,1 2 6
2 2 7 ,2 0 4
4 ,4 2 0 ,8 0 9
2 11 ,7 71
1 .1 5 2 ,7 3 4
236 ,1 21
1 9 2 ,6 70
3 ,6 9 7 ,8 9 3
_
_
+
-
3
6
0
0
5
+ 19
+ 15
+ 16
+ 19
+ 14
+ 19
+ 14
+ 21
+ 10
+ 13
B ilo x i-G u lfp o rt . . .
Jackso n
.........................
2 5 6 .2 7 3
1 ,4 08 ,5 06
2 80,701
1 ,4 6 6 ,4 3 6
2 5 0 ,5 1 7
1 ,2 3 5 ,3 8 8
-
9
4
+ 2
+ 14
+ 20
+ 23
C h atta n o o g a
. . .
K n o x v ille
. . .
N a s h v ille
. . . .
1 .3 79 ,9 80
9 4 3 ,9 4 4
3 ,4 8 1 ,0 3 3
1 ,2 8 6 ,8 2 0
9 4 9 ,1 3 3
3 ,1 8 2 ,1 9 3
9 4 2 ,2 07
7 4 8 ,3 2 0
2 .7 0 1 ,4 9 8
+ 7
_ 7
+ 9
+ 46
+ 26
+ 29
+ 24
+ 21
+ 21
1 09 ,7 70
1 05,479
101,173
+ 4
+ 8
+ 14
O TH ER C E N T E R S
A n n isto n
.........................
.
A u g u st
1973
fro m
. . . .
. . . .
B ra d e n to n
. .
M onroe C o u n ty
O ca la
. . . .
S t. A u g u stin e
S t. P e te rs b u rg .
Tam pa
. . . .
A th e n s
.
B ru n s w ic k
D aito n
.
E lb e rto n
G a in e s v ille
G riffin
.
L a G ra n g e
N ew n a n .
Rom e
.
V a ld o sta
.
.
. .
. .
. . .
. . .
. .
. . .
. . .
. . .
. . .
. . .
A b b e v ille
.
B u n k ie
. . .
Ham m ond
.
New Ib e ria
P la q u e m in e
T h ib o d a u x .
.
.
.
.
.
.
.
H a ttie sb u rg
.
L a u re l
. . . .
M e rid ia n
. .
N a tc h e z
. .
P a sc a g o u la M o ss P o in t
V ic k s b u rg
. .
Y a zo o C ity
.
.
.
.
.
.
A u g u st
1972
d a te
8 m o s.
1973
J u ly A ug. fro m
1973 1972 1972
1 3 1 ,1 18
6 5 ,9 2 7
+ 12
+ 10
+ 55
+ 24
+ 41
+ 28
1 3 3 ,0 06
58,90 1
146 ,5 39
3 3 ,9 1 5 r
7 4 8 ,2 9 6
1 ,4 7 3 ,6 0 2
- 3
+ 17
+ 4
- 1
- 9
+ 11
+ 36
+ 49
+ 41
+ 30
+ 34
+ 37
+ 31
+ 33
+ 40
+ 20
+37
+ 22
1 6 4 ,5 06
1 02 ,8 83
1 6 6 ,7 00
1 9 ,4 6 9
1 4 1 ,1 30
7 2 ,2 9 6
3 9 ,7 9 3
5 6 ,7 9 0
1 42 ,8 80
9 8,96 3
147 ,0 83
7 9 ,5 2 2
155 ,6 95
2 1 ,4 5 9
1 11 ,8 72
5 8,82 2
3 6,07 6
5 0 ,3 8 8
1 2 2 ,7 56
91,26 1
+ 11
+ 8
+ 17
+ 12
+ 2
+ 7
+ 5
-11
+ 3
- 0
+ 24
+ 39
+26
+ 2
+ 28
+ 31
+ 16
- O'
+ 20
+ 8
+ 14
+33
+ 15
+ 2
+ 29
+ 24
+ 24
+ 37
+ 16
+13
1 5,63 6
1 0,29 0
8 7 ,1 4 0
6 1 ,0 8 7
2 6 ,6 0 5
4 2 ,2 4 3
18,94 2
11,131
9 5 ,1 9 2
6 2 ,9 1 7
2 8 ,0 9 2
3 8 ,3 5 3
14,723
8 ,6 19
6 3 ,0 0 4
5 0,89 6
15,911
2 9 ,6 5 7
-17
- 8
- 8
- 3
- 5
+ 10
+ 6
+ 19
+ 38
+20
+67
+42
+ 5
+ 24
+ 36
+ 14
+ 60
+ 16
A u g u st
1973
J u ly
1973
2 0 3 ,2 9 8
8 1 ,9 8 4
1 8 0 ,9 55
74,84 1
1 8 0 ,8 9 4
87,61 1
2 07 ,2 91
4 3 ,9 4 7
1 ,0 01 ,0 26
2 ,0 2 3 ,3 2 7
186 ,6 13
7 5 ,1 8 8
2 0 0 ,0 8 4
4 4 ,1 8 7
1 ,0 9 7 ,9 4 7
1 ,8 2 4 ,4 5 6
1 8 2 ,4 08
1 1 0 ,6 57
1 9 5 ,5 60
2 1 ,8 8 8
1 43,651
77,26 1
4 1 ,9 0 0
5 0 ,3 1 8
1 4 7 ,5 97
9 8 ,6 6 8
.
.
.
131 ,6 20
7 2 ,7 4 9
1 21 ,1 43
5 4 ,8 5 2
1 37 ,7 97
7 6 ,0 5 0
1 37 ,5 48
5 3 ,5 1 5
1 0 8 ,7 1 9
6 3 ,3 6 4
105 ,9 97
4 7 ,0 2 8
- 4
- 4
-1 2
+ 2
+ 21
+ 15
+ 14
+ 17
+23
+ 19
+ 19
+ 14
.
.
.
.
.
.
8 6 ,5 9 3
6 9.59 5
3 8 ,9 3 0
1 3 9 ,0 59
7 8 ,3 6 8
46,98 1
1 4 9 ,7 99
5 6,03 4
3 0 ,7 6 7
-3 8
-11
-1 7
-4 2
+24
+ 27
+ 10
+ 24
+ 10
B ris to l
.........................
Jo h n so n C ity . . .
K in g sp o rt . . . .
1 15,391
1 7 6 ,7 56
2 6 7 ,9 7 8
116 ,4 92
1 88,371
25 9 ,9 8 7
1 28 ,7 02
1 41 ,3 20
2 2 7 ,5 0 4
- 1
- 6
+ 3
-1 0
+ 25
+ 18
- 2
+ 18
+ 18
D is t ric t
To ta l
.
.
.
. 7 6 ,8 9 7 ,7 7 8
7 4 ,9 6 6 ,7 2 2 r 6 0 ,2 1 1 ,2 6 2 r
+ 3
+28
+26
A la b a m a
. . . .
8 ,4 0 7 ,9 0 2
F l o r i d a ......................... . 2 7 ,0 4 1 ,7 3 6
G e o r g i a ........................
2 2 ,5 2 5 ,1 3 4
L o u is ia n a '
. . . . 7 ,5 7 5 ,8 1 9
M is s is s ip p i'
. . . . 2 ,9 0 1 ,2 3 3
Ten n e sse e '
. 8 ,4 4 5 ,9 5 4
8 ,6 0 4 ,7 4 1
7 ,2 8 9 ,7 3 5
2 5 ,8 9 5 ,2 08 r 2 0 ,2 3 6 ,6 0 2 r
2 1,1 5 2 ,6 6 3
1 6,62 8,73 2
7 ,9 13 ,6 81
6 ,5 6 9 ,3 8 0
3 ,2 0 1 ,7 1 8
2 ,7 0 1 ,7 15
8 ,2 28 ,7 11
6 ,7 8 5 ,0 9 8
+
+
+
+ 15
+ 34
+ 35
+ 15
+ 7
+ 24
+20
+ 27
+ 34
+ 21
+ 19
+ 20
2
4
6
4
9
3
1 D is t ric t p o rtio n o n ly
r-R e vise d
* C onfcfrm s°toS°M SA3 dVf?nfti o n s a s *of* De c e m b e r 31 ^ 972^ " 8UreS PU b" Shed
FEDERAL RESERVE BANK OF ATLANTA
" B a n k DebitS a " d D eP ° Si‘ T U rn ° V er" by B ° ard 0 f G ° ve m 0 rS of th e F e d e ra l
S»
167
D i s t r i c t
_
B u s i n e s s
C o n d i t i o n s
Mfg. Producti on
1 9 5 7 - 5 3 =1 0 0
S e t s . Adj.
Unemployment Rate
*Seas. adj. figure; not an index
Latest plotting: August, except mfg. production, June, and farm receipts, July.
The Southeast e c o n o m y still displays considerable resistance to a slo w d o w n , alth ou gh som e elem ents are
m oderating.
C onstru ctio n activity continued to increase despite a lackluster perform ance by the h o u sin g
sector. Agricultural prices m o ved up then d o w n sharply, and
crop
prod u ction
prospects
im proved.
The
grow th in em p lo ym en t m oderated in the face of lo w u n e m p lo ym e n t rates and high labor dem an d. Bu si
ness loans at banks have resum ed a slow er pace after a brief resurgence, and con su m e r sp e n d in g is less
exuberant.
V a lu e o f construction contract aw ards w as pushed
Em p loym ent e dged u pw ard in A u gu st, th o u gh at
to new heights by record levels of non-residential
a slow er pace than in recent m onths. Nevertheless,
awards.
C o m m e rcial and engineering construction
labor dem an d rem ains high. Job levels of m an u
accounted for m uch o f the strength in the n on
facturing and construction were up in all reporting
residential sector in August. The value of residential
states.
contract aw ards changed
creased in all states except Louisiana. Both factory
little from
July's level.
N o n m an u fa ctu rin g
e m p lo ym e n t
also
in
Activity in the residential sector continued to be
b elo w levels recorded in late 1972 and early 1973.
R ising interest rates on construction and perm anent
hours and earnings m aintained
achieved the previous m onth.
loans, rising construction costs, and net outflow s
from thrift institutions continued to be problem s for
August, particularly business loan s to textile and
service industries. D e p o sits also surged; the in
the residential sector.
Agricultural prices in A u gu st sh ow ed the largest
crease w as entirely attributable to increases in tim e
deposits. B o rro w in g from the Federal Reserve and
on e -m on th increase o f record, fo llo w in g the re
purchases o f Federal funds also rem ained at very
m oval o f the price freeze on
m ost fo o d
Bank
le n d in g
sh ow e d
the
unexpected
high
levels
strength
in
com
high levels. By m id-Septem ber, however, larger D is
for meats and
trict banks had returned to the m o deratin g levels
increased livestock m arketings have co m b in ed to
of business len ding o f early sum m er and were re
produce
d u cin g their purchases o f large-den om in ation C D 's.
m odities. How ever, slack dem and
sharp
price
reductions
through
early
Septem ber. Recent crop production forecasts in d i
cate
im proved
yield
prospects
for the
C o n su m e r instalm ent credit gre w m oderately in
District's
A ugust. N e w c onsum e r len din g at com m ercial banks
soybeans, cotton, and peanuts, but the rice crop
slackened from this year's earlier extrem ely high
w as d am aged by heavy rainfall. Broiler placem ents
levels, as all categories except direct auto loans grew
have declined from a m onth ago, principally re
less than in the previous m onth. Prelim inary retail
flecting reductions in A lab am a and Louisiana, but
sales indicators sh ow c o nsum e r sp e n d in g c o n tin u
eggs
ing strong, particularly for autos. How ever, grow th
set for broilers
have
increased.
Farm
cash
receipts continue at least one-fourth higher than
in consum e r sp e n d in g is less exuberant than
1972's levels in five of six District states.
earlier m onths this year.
1 6 8 for FRASER
Digitized
in
O C T O B E R 1973, M O N T H L Y REVIEW
@FedFRASER