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M o n th ly I p R e v ie w F E D E R A L R E S E R V E B A N K O F AT L A N T A A T L A N T A , V o lu m e X X V I I G E O R G IA , O C T O B E R 31, N um ber 1942 10 Sixth D istrict Business Conditions October saw Sixth District farmers harvest the best crops in many years and, because they were able to market these crops at the highest prices in recent years, farm income in this area reached an all-time high. Monetary circulation continued to expand, reflecting the extremely high levels of business activity stemming from the war production effort and sharp rises in farm wage rates. Agriculture: Although the October estimate is somewhat lower than that of September, the 1942 cotton crop forecast for the six states, either wholly or partly in the District, of 5.1 million bales is 36 per cent above production in 1941 and approximately 5 per cent above the 1931-40 average. The total United States cotton crop was forecast at 13.8 mil lion bales on October 1, compared with the forecast of 14 million bales on September 1. Declines in the indicated yield were predicted for all states of the District with the exception of Mississippi where an increase of 30,000 bales was pre dicted and Tennessee where the October estimate was the same as that of September. With increased production and the continued high price, cotton farmers face the prospect for much larger returns from cotton marketing this year. The ten market average price for Middling 15/16 on October 16, was 18.95 cents as com pared with 18.78 cents a week earlier and 16.16 cents a year ago. The September farm price was the highest for any September since 1927. The domestic carry-over of American cotton on August 1 was 10.5 million bales, 1.5 million less than a year earlier. The large 1942 production will bring the total domestic supply to about 24 million bales compared with 22.6 million last year. Despite the decrease in foreign consumption of cotton from 2.3 million to 1.3 million bales, world con sumption of cotton increased from 11.8 million bales to 12.2 million bales for the 1941-42 season as the result of increases in United States consumption. Because of the labor situation in the cotton textile industry and the near-capacity operation of many mills, further increases in consumption will probably be quite limited and total consumption in 1942-43, as pre dicted by the Department of Agriculture, may be limited to about 11.6 million bales compared with 11.2 million in 1941-42. The Government loan program may be expected to keep the price of cotton at its present level. Under the Price Stabilization Act, approved by the President on October 2, the loan rate on cotton has been increased 1 cent per pound above the rate previously announced, bringing the rate from 85 to 90 per cent of parity prices. Additional payments will be made to producers who have already obtained loans on the 1942 crop. The cotton of which there definitely is an over-supply Digitized for only FRASER R e c o n n a is s a n c e PER C E N T D EC R E A S E ^ PER C EN T IN C R E A SE Retail i i i Hetail W i « | | | | | S | | I I Fumitui§ Sales W holesale Sales llllll— l i i Collections Cotton C o j j — M— i, Bank M l l l l i n i l l l Lo^ ■ M ember B a ^ ||» # M |1 ||l ||||||l |||i l |||B |B I B I I I ! l l l l Demand D e p < f l a i I l l M ^ ^ —______________________________________________ + 40 30 20 10 0 10 20 30 40 S ix th D is tric t s ta t is tic s fo r S e p te m b e r 1942 c o m p a r e d w ith S e p te m b e r 1941. under existing conditions, according to the Department of Agriculture, is short-staple cotton, a high proportion of which is lower grade. During the present season, farmers were urged to increase the production of cotton having a staple length of one and one-eighth inches or longer. It is too early at present to know how successful that program has been, although the Department of Agriculture announced on Oc tober 8 that the 1942 crop in most of the southeastern states is of a lower grade and shorter staple length than last year. In view of these factors, farmers are urged to turn to longer staple varieties next year which will involve buying new planting seed as early as possible. Premiums and discounts under the 1943 loan program may bear a much closer re lationship to market differentials than at present. The United States production of peanuts for picking and threshing from this year’s crop is now expected to be 2.9 million pounds. Of this crop, 1.4 million pounds are accounted for by production in the Six States—almost as much as the entire 1941 United States production of 1.5 million pounds. Yield per acre prospects increased during September in Mississippi and Louisiana, while they declined in Georgia and remained unchanged in the other states of the District. On September 23 prevailing sales and quotations on farmers’ stock No. 1 Spanish peanuts ranged from $133 to $135 per ton, with runner peanuts at $115 to $120 per ton. The loan rate on quota peanuts has been increased from 7 0 M o n t h l y R e v ie w of the Federal Reserve B a n k of Atlanta for October 1942 SALES O F UNITED STATES WAR SAVINGS BONDS IN THE SIXTH FEDERAL RESERVE DISTRICT S a le s R ep o rte d in P e rio d S e p te m b e r 24-O ctober 23. 1942 At Is su e P rice T O T A L ................................................................ A la b a m a ........... .......................................... F lo r id a ............. .......................................... G e o r g i a ........... .......................................... L o u i s i a n a ......... .......................................... ............................................ M is siss ip p i T e n n e s s e e ___ .......................................... S e r ie s E $31,527,881.25 6,211,125.00 5,954,456.25 6,482,643.75 5,678,475.00 2,332,443.75 4,868,737.50 S e r ie s F a n d G $14,338,964.50 2,490,160.00 2,780,816.50 2,408,513.50 3,622,710.50 1,090,236.50 1,946,527.50 SIXTH DISTRICT BUSINESS INDEXES ______________ D e p artm e n t S to re Sales** . . . . . . . Jackson. , . N ew O rle a n s . . . T a m p a .................. . . . (1935-39 A v e r a g e = 1 0 0 ) A d ju s te d * ** U n a d ju s te d S e p t. S e p t. A ug. S e p t. A ug. S e p t. 1941 1942 1942 1941 1942 1942 169 149 171 158 161 144 149 148 157 140 166 143 164 207 190 179 148 170 164 155 161 160 150 166 187 185 154 158 165 142 198 186 159 210 206 233 170 215 182 218 166 210 164 159 167 147 150 151 179 161 166 226 210 229 116 134 141 111 91 135 187 171 197 219 173 213 127 117 121 139 133 138 145 148 145 163 157 160 149 154 185 195 197 157 ________________ D e p a r tm e n t S to r e S to c k s _________________ D IS T R IC T ............................. A tla n ta ............................... B ir m in g h a m .................... M o n tg o m e r y .................. N a s h v ill e .......................... N e w O r l e a n s .................. (1935-39 A v e r a g e = 100) A d ju s te d * * * U n a d ju s te d S e p t. A ug. S e p t. S e p t. A ug. S e p t. 1942 1942 1941 1942 1942 1941 177 195 143 187 188 151 210 229 181 224 224 193 179 177 122 182 178 124 144 155 135 161 154 IPO 206 217 171 223 217 185 167 211 150 175 198 158 __________ P a y ro lls __________ SIX S T A T E S ........................ A la b a m a ........................... F lo r id a ............................... G e o r g i a ............................. L o u i s i a n a ........................ M is s is s ip p i...................... T e n n e s s e e ...................... (1932 A v e r a g e = 100) S e p t. A ug. S e p t. 1942 1942 1941 364 361 252 598 612 384 168 158 106 372 349 284 349 347 201 319 333 211 314 324 250 C o tto n C o n s u m p tio n * * (1923-25 A v e r a g e = 100) S e p t. A ug. S e p t. 1942 1942 1941 T O T A L ................................... 285 255 250 A la b a m a ........................... 327 300 303 G e o r g i a ............................. 271 240 231 T e n n e s s e e ...................... 247 210 218 ___________ W h o le s a le S a le s ___________ _________ E m p lo y m e n t_____ (1932 A v e r a g e S e p t. A ug. 1942 1942 176 174 218 216 113 111 188 184 189 186 146 144 153 157 — 100) S e p t. 1941 156 173 99 174 145 134 155 C o a l P ro d u c tio n * * (1935-39 A v e r a g e = 100) S e p t. A ug. S e p t. 1942 1942. 1941 165 162 135 168 168 125 158 146 152 _____ E le c tric P o w e r P ro d u c tio n * * ______ (1923-25 A v e r a g e = 100) (1935-39 A v e r a g e = 100) S e p t. A u g . S e p t. S e p t. A u g . S e p t. 1942 1942 1941 1942 1942 1941 D IS T R IC T .................. 94 9199 SIX S T A T E S .........................218 214 175 D r u g s .................... 155 149 145 H y d r o - g e n e r a t e d . 223 218 127 D ry G o o d s ...........109 116 103 F u e l - g e n e r a t e d . .. 213 209 238 G r o c e r i e s ............. 84 79 73 H a r d w a r e ............. 125 116 171 * N ot in c lu d e d in to ta ls . _______ C o n s tr u c tio n C o n tr a c ts _______ ** I n d e x e s of d e p a r t m e n t s to r e s a le s , (1923-25 A v e r a g e = 100) Sept A ug. S e p t. 1942 1942 1941 f.le c tr ic *>°w,e r * n d c o a l P r o d u c tl o n - a n d °.f. c o tto n c o n s u m p tio n a r e o n a d a ily a v e r a g e b a s is . ^ R e s i d e n t i a l . . . . ^65 pi -3 ........... 311 ........... ,o o *71 394 oen ,°c G e o r g i a . . ! . . ■ 398 401 271 L o u i s i a n a ......... 73 397 141 M is s is s ip p i___ 1353 1840 1057 T e n n e s s e e ___ 147 86 1319 *** A d ju s te d fo r s e a s o n a l v a ria tio n . B a c k f ig u r e s fo r d e p a r t m e n t s to r e s a le s a n d s to c k s in th e n e w s e r ie s w il1 b e f u r n is h e d u P °n re * u e s t' 85 to 90 per cent of parity prices. All peanuts produced over and above the AAA acreage allotments must move into oil channels. Although September estimates were revised downward in October for some of the other important crops of the District, prospects continue for better-than-average crops in general. If first prospects materialize, the tonnage of Louisiana and Florida cane used for sugar will be the largest on record— 6.7 million tons—and 35 per cent above the amount used for that purpose in 1941. Production of cane for both sugar and seed is estimated at 6.2 million tons in Louisiana compared with 4.5 million tons in 1941, and at 1.2 million in Florida compared with 974 thousand tons last year. In Florida the early and mid-season orange crop is placed at 17.2 million boxes. The 1941 crop totaled 15 million boxes. The tangerine crop estimate of 3.5 million boxes is 67 per cent larger than last year’s production. Prospective production of grapefruit is 29 per cent above last year’s. According to a policy adopted by the Growers’ Administrative and Shippers’ Advisory committees, operating under the Federal Citrus Marketing Act, the shipping of third-grade Florida citrus fruit in interstate commerce is to be prohibited this season provided the policy receives Federal approval. What may prove to be an important development in the citrus industry is the formation of a chemical company at Winter Haven for the manufacture of alcohol and molasses from the pressed citrus juice and the waste water of the citrus peel. The plant is to have a daily capacity of 6000 gallons of molasses and 3000 gallons of 190 proof ethyl alcohol. Not only will the plant provide a means of utilizing citrus by-products, but at the same time it will furnish alcohol for the production of smokeless powder. While the increased crop yields have been predicted for some time, whether or not they will be finally realized de pends on how well farmers are able to meet harvesting problems. Increasing difficulties are reported from different areas in securing adequate labor supplies. According to the Bureau of Agricultural Economics, the index of the supply of farm labor throughout the United States is at 70 per cent of the 1935-39 average, while demand stands at 117. Con ditions in the Southeast are somewhat better than those throughout the United States. However, as a result of the labor situation, farm labor wage rates averaged $1.70 on October 1 this year in the Six States, an increase of 30 per cent from October of last year. Throughout the United States as a whole, farm labor wage rates increased 33 per cent over the same period. Various methods have been utilized to meet the labor problem. In Georgia special school holidays have been de clared in some counties in order to overcome the shortage of cotton pickers. Mechanical harvesters will be used more exFARM LABOR W A GE RATES PER DAY W ITHOUT BOARD A la. 194 1 J a n u a r y ..........................90 1.00 A p r il...................... J u l y ......................... 1.00 O c t o b e r .................. 1.25 1942 J a n u a r y .................. 1.20 A p r il...................... 1.30 J u l y ........................ 1.35 O c t o b e r .................. 1.65 So u rce : F la . G a. L a. 1.35 1.35 1.40 1.55 .90 .95 1.00 1.15 1.05 1.10 1.15 1.30 1.00 1.05 1.05 1.25 1.65 1.75 1.75 2.05 1.10 1.20 1.25 1.45 1.25 1.30 1.35 1.70 1.25 1.25 1.30 1.60 U . S . D e p a rtm e n t o f A g r ic u ltu r e . M iss. T e n n . D istric t ~ 1.05 1.04 1.10 1.09 1.20 1.13 1.35 1.31 1.35 1.40 1.45 1.75 1.30 1.37 1.41 1.70 U .S. 1.59 1.70 1.98 2.08 2.12 2.10 2.45 2.76 M o n t h l y R e v ie w of the Federal Reserve B a n k of Atlanta for October 1942 tensively than usual in Louisiana for harvesting cane. Em ployers of farm labor in the Lake district in Florida have recently organized themselves into a vegetable growers as sociation to distribute the available labor efficiently and to arrange for the importation of any necessary itinerant labor. The fear of a labor shortage is also being reflected in the reluctance of some growers to plant acreages in winter vege tables on as large a scale as formerly. The large crops have also created a storage problem. In Mississippi, for example, the estimated production of soy beans for oil is placed at about 3 million bushels in addition to the peanuts grown for oil. This is the first year these two commodities have been grown in the state for oil purposes and cotton seed crushing mills are already taxed with handling of cotton seed. Farmers have been asked by the Department of Agriculture to store soy beans on their farms wherever possible until such time as the crushing mills will be able to handle them. Wholesale Trade: Distribution of merchandise through Sixth District wholesale firms increased 3 per cent in Sep tember but was only 1 per cent larger in dollar volume than in September 1941. This is the same percentage increase that was shown by August sales over those in August last year. Taken in conjunction with the Bureau of Labor Sta tistics’ wholesale price index, which has recently been about 9 per cent higher than it was a year ago, this means that these firms are selling a smaller volume of goods than they were at this time last year. In September there were declines from August in sales of dry goods, fresh fruits and vegetables, meats and meat products, and machinery and equipment. DEBITS TO INDIVIDUAL ACCOUNTS (In T h o u sa n d s oi D ollars) A ug. 1942 14,658 158,227 7,252 8,043 98,665 35,800 13,724 149,676 5,806 . 7,354 110,329 35,913 123,188 64,277 13,013 18,795 11,418 53,010 126,897 60,148 12,398 16,325 9,888 50,367 98,395 55,802 7,967 325,127 30,235 7,991 33,303 1,767 34,973 3,511 63,222 6,158 7,123 310,120 28,148 7,752 28,641 1,288 34,133 3,274 56,106 11,928 7,785 274,301 26,203 3,609 25,260 1,380 26,902 3,277 38,743 6,604 27,152 12,230 334,111 36,200 10,081 305,756 298,697 — 25 + 21 + 9 + 12,846 61,351 16,465 11,368 11,668 39,521 18,493 12,461 11,854 36,359 17,722 9,712 + 10 + 55 — 11 — 9 + 8 + 69 — 7 + 17 78,411 44,293 137,608 72,254 40,480 137,683 61,528 39,755 118,424 + + — 9 9 0 + 27 + 11 + 16 4- 5 + 21 7 + 20 141,995 5,473 68,691 31,849 + 7 + 6 + 25 + 9 — 11 — 0 + + 11 32 + + 44 12 — 3 + 7 + 5 + 15 + 15 + 5 + + 25 15 + 12 + + + + + + + — 7 3 16 37 2 7 13 48 + 2 + 19 + 15 + 121 + 32 + 28 + 30 + 7 + 63 — 7 FLORIDA la c k s o n v ill e ............... M ia m i............................. O r la n d o * ...................... P e n s a c o l a .................... S t. P e te r s b u r g * ......... T a m p a .......................... 13,940 37,103 + 35 + 43 GEORGIA A lb a n y .......................... A tla n ta .......................... A u g u s t a ........................ B r u n s w ic k .................... C o lu m b u s .................... E l b e r to n ...................... M a c o n .......................... N e w n a n ........................ S a v a n n a h .................... V a ld o s ta ...................... LOUISIANA B a to n R o u g e * ........... L a k e C h a r l e s * ........... N e w O r l e a n s ............. . . . . 12 M ISSISSIPPI H a t t i e s b u r g ............... l a c k s o n ........................ M e r id ia n ...................... V ic k s b u r g .................... TENNESSEE C h a t ta n o o g a ............. K n o x v ille ...................... N a s h v ill e ...................... SIXTH DISTRICT 26 C i t i e s ...................... . . . . 1,769,921 1,682,290 1,461,363 52,704,000 49,180,000 43,866,000 UNITED STATES 274 C i t i e s .................... . . . . Decreases from September last year in sales of electrical goods, hardware, and machinery and equipment, all of which are made of critical materials, were sufficiently large nearly to offset increases reported in other lines. Inventories in the hands of wholesalers declined 9 per cent in September. During all of 1941 and the first six months of 1942 wholesale stocks were consistently larger in dollar value than they had been in corresponding months a year earlier, at least a part of these increases being due to the steady rise in prices. But in July, August, and September wholesale in ventories were 3 per cent, 14 per cent, and 15 per cent, respectively, smaller than in those months a year ago, in spite of higher prices. In September the only wholesalers report ing their stocks larger than in September 1941 were in the fresh fruits and vegetables, beer, and miscellaneous groups. WHOLESALE SALES ANDINVENTORIES — SEPTEMBER 1942 S ales In v en to ries N o. of P e r C e n t C h a n g e F ro m F irm s A u g . 1942S e p t. 1941 A u to m o tiv e 4 S u p p l i e s ........... C lo t h in g ............... 3 S h o e s ...................... 3 D ru g s an d S u n d r i e s ........... 6 D ry G o o d s ........... 12 E le c tric a l G o o d s 8 F r e s h F r u its a n d V e g e t a b l e s . .. 6 M e a ts a n d M eat P r o d u c ts ........... 3 G r o c e r i e s ............. 46 B e e r ........................ 4 H a r d w a r e ............. 19 M a c h in e r y a n d E q u ip m e n t.. . . 5 P a p e r P r o d u c ts . 4 Tobacco P r o d u c t s ........... 5 M is c e lla n e o u s . . 1 8 T o t a l.................. 146 N o. o f P e r C e n t C h a n g e F ro m F irm s A u g . 1942 S e p t. 1941 sam e + 5 + 10 + 12 +24 + 8 + 4 — 6 + 8 +20 + 7 — 30 6 6 — + 26 3 — 6 + 6 + 9 + 8 4 + 5 +21 +17 — 6 3 19 3 10 — 1 + 1 — 25 sam e + 3 + 5 + 3 +13 — 2 + 1 — 16 — 14 + — 1 — 42 86 + 86 — 17 — 2 + 5 — 11 — — + — 19 11 24 20 3 — 8 — 9 i6 69 — i — 9 + "6 — 15 S o u rc e : U . S. D e p a r tm e n t of C o m m e rc e P er C ent C hange S e p t. S e p t. 1942 fro m 1941 A u g .1942 Seo.1941 S e p t. 1942 ALABAMA A n n is to n * .................... B ir m in g h a m ............... . . . . D o th a n .......................... G a d s d e n * .................... M o b ile ........................... M o n tg o m e r y ............. 7 1 + Textiles: In September the rate of textile activity in the Sixth District rose to a new high level. Cotton mills in Ala bama, Georgia, and Tennessee used more cotton in the month of September than in any other month on record excepting July and, because September was shorter by one working day than July, the daily average rate of consumption reached a new high level. The daily rate in September was 12 per cent above that for August and up 14 per cent from September last year. New high levels of textile activity have been re corded in seven of the past twelve months. Retail Trade: Department store sales in the District during September were 9 per cent above those in September of 1941. The index of daily average sales adjusted for seasonal vari ations, however, declined eight points in September after having reached a peak in August. Although department store stocks on September 30 were 20 per cent above those a year ago, the adjusted index of department store stocks has registered a decline each month since July. Shortages of many items are developing and the stocks index may be expected to decline further in months to come. In the four weeks ending October 24, department store sales in the Sixth District were up 17 per cent over the four weeks ending October 25, 1941, as compared with a rise of 14 per cent in the country as a whole. In four Districts the increase was greater than in the Atlanta District; in seven the increase was smaller percentagewise. In dollar volume, retail furniture store sales were approxi mately the same in September this year as in 1941, in con- M 7 2 o n t h l y R e v ie w of the Federal Reserve B a n k of Atlanta for October 1942 trast with previous months of this year when sales were fai below last year’s levels. September sales in 1941 were un usually low because of the introduction of the Federal Re serve Consumer Credit Regulation and the necessity for ad justment in merchandising and financing methods. Total sales of reporting stores in September were 1 per cent less than in August 1942 and sales of this month were in turn 44 per cent lower than those in August 1941. OPERATING DATA O F RETAIL FURNITURE STORES IN THE SIXTH FEDERAL RESERVE DISTRICT T o tal S a l e s ........................................ C a s h S a l e s ...................................... I n s ta lm e n t a n d O th e r S a l e s . . . A c c o u n ts R e c e iv a b l e .................. C o ll e c t io n s ...................................... I n v e n t o r ie s ...................................... N u m b e r of S to r e s 103 90 90 100 100 79 S e p te m b e r 1942 c o m p a r e d w ith : A u g u s t 1942 S e p te m b e r 1941 — 1 + 1 — 1 +54 — 3 3 — 5 — 31 — 3 f 0 + 18 Industry: With the volume of industrial production for war purposes limited only by available facilities, manpower, and raw materials, production in most industries in the Dis trict continues at a high level. A total of $3.6 billion of major war and supply facility contracts has been awarded in the Sixth District from June 1940 through July 1942. The greater part of the total consists of facilities contracts al though $1.6 billion of the total is accounted for by supply contracts. The largest part of the supply contracts, or 54 per cent, was for ships, with the construction of aircraft account ing for 7 per cent, and all other types of contracts for 39 per cent of the total. Approximately 55 per cent of the facility contracts were for nonindustrial facilities, covering such things as the construction of army camps and other military installations. In compiling the data, the War Pro duction Board excluded contracts having a value of less than $50 thousand and all awards for food purchases. The completion of each new industrial facility brings with it the problem of utilizing the manpower of the area most effectively. In Panama City, Jacksonville, Birmingham, and Atlanta the War Manpower Commission is studying the problems created by the increased manpower loads in those areas. The war program is creating tremendous changes in the South and no doubt many of these changes will be continued in the postwar years. A recent report of the Southeast Regional Planning Commission concludes that as a result of the war, the region will have developed important tools and skills which may be utilized in the postwar years. War expenditures, according to the report, will have provided additional income in the area which may be used as a source of investment funds. Shortages of skilled labor will be de creased because of training in war industries. The conversion problem may not be great since many of the new plants may be able to step rather easily into peacetime industries. The report warned, however, that steps must be made to combat immediate postwar unemployment. Mining: Output of coal in Alabama and Tennessee, on a daily average basis, increased only slightly in September, when there is usually a rather substantial rise. The rate for September was about 2 per cent larger than that for August and 22 per cent above the rate for September 1941. How ever, when allowance is made for the usual seasonal trend, the adjusted index of September output was down 9 per cent from August, being the lowest since March. Construction: Construction contracts were awarded during September in the Sixth District in a total amount of approxi mately $75 million, a gain of 8 per cent over August, but considerably less than the large total reported for September last year which was, at that time, the largest total ever re ported for a single month. It should be recalled that contract awards in this District during August, September, and Oc tober of 1941 accounted for about half of the year’s total and were greater than had ever been reported for a three-month period until the summer of this year. In the first three quar ters of 1942 the total value of contracts awarded in this Dis trict has been $705 million, larger by 48 per cent than for that part of last year. On October 21 the War Production Board announced that MAJOR WAR SUPPLY AND FACILITY CONTRACTS SIXTH DISTRICT it intends to reduce the 1943 construction schedule by about J u n e 1940 T h r o u g h J u ly 1942 one-third. The present schedule stands at $16 billion. ( In T h o u s a n d s of D o lla rs) I n d u s tr ia l S u p p ly F a c ilitie s Treasury Issues: On October 19, 1942, the Secretary of A re a T o ta l C o n tr a c ts P r o je c ts the Treasury offered for subscription an issue of 2 per cent T O T A L ............. .............................................. $3,601,690 $1,639,373 $1,962,317 A tla n ta ....................................................... 130,344 35,718 94,626 Treasury Bonds due in 1950-52. Subscriptions in the Sixth B irm in g h a m ............................................ 57,580 52,116 5,464 C h a t t a n o o g a .......................................... 144,720 74,923 69,797 District amounted to $88,697,500, and were allotted in full. C h i l d e r s b u r g .......................................... 275,347 91,210 184,137 An issue of 1.5 per cent Treasury Notes, Series B-1946, was K n o x v ille ................................................. 18,687 15,221 3,466 M o b ile - P a s c a g o u la ............................. 442,955 383,396 59,559 offered on September 25, and Sixth District subscriptions of M u sc le S h o a ls - S h e f f ie ld .................. 43,032 2,638 40,394 N a s h v ill e ................................................. 77,799 68,855 8,944 $67,752,500 were also allotted in full. These offerings were N e w O r l e a n s .......................................... 259,047 188,734 70,313 R e m a in d e r of D is tr ic t........................ 2,152,179 726,562 1,425,617 in addition to the 0.65 per cent Treasury Certificates of In debtedness and 1.25 per cent Treasury Notes offered on S o u r c e : W a r P r o d u c tio n B o ard . September 21 and 25, respectively, referred to in the Sep tember Monthly Review. Treasury bills continue to be offered Gasoline Tax Collections: During September collections weekly. of gasoline taxes in the six states of the District, continued their downward trend. Collections in September of this year UNITED STATES TREASURY BILLS : TENDERS AND ALLOTMENTS IN THE for the District as a whole were 25 per cent below those in SIXTH FEDERAL RESERVE DISTRICT OF ISSUES DATED S e p te m b e r 15 to O cto b er 15, 1942 September 1941. In Florida and Georgia, the two rationed D a te d ___________________________ T e n d e r s __________________A llo tm e n ts states, the decline was particularly severe—38 and 40 per S e p te m b e r 16, 1942.................................................$11,960,000 $ 8,945,000 cent respectively. In Florida collections during September S e p te m b e r 23, 1942................................................. 11,095,000 9,065,000 S e p te m b e r 30, 1942................................................. 8,085,000 5,385,000 were 27 per cent below the monthly average of the pre-war O c to b e r 7, 1942....................................................... 8,675,000 7,379,000 O c to b e r 14, 1942....................................................... 13,525,000 12,879,000 year, 1939, while in Georgia the collections were 19 per cent T o t a l ....................................................................................$ 5 3 ,3 4 0 ,0 0 0 $ 4 3 ,6 5 3 ,0 0 0 below that average. Collections for the Six States were 2 M o n t h l y R e v ie w of the Federal Reserve B a n k of Atlanta for October 1942 per cent above the 1939 average, compared with 6 per cent above that average in August. GASOLINE TAX COLLECTIONS (1939 M o n th ly A v e r a g e = 100) S e p te m b e r 1942 A u g u s t 1942 D IS T R IC T ............................................ A la b a m a .......................................... F lo r id a .............................................. G e o r g i a ............................................ L o u is ia n a ........................................ M is s is s ip p i...................................... T e n n e s s e e ........................................ 102 124 73 81 105 Ill 137 S e p te m b e r 1941 106 127 86 97 105 108 125 136 143 116 136 136 144 158 CONSUMER INSTALMENT CREDIT OPERATIONS O F 38 MEMBER BANKS IN THE SIXTH FEDERAL RESERVE DISTRICT P e r c e n t a g e C h a n g e A u g . 1942 to S e p t. 1942 V o lu m e O u ts ta n d i n g s — 24.4 + 9.5 — 13.6 _ + 2.1 4 159.1 — 16.4 + 61.6 — .1 — 82.3 -f 7.0 + 3.2 — — — — 5.4 3.8 5.4 8.8 OPERATIONS O F CONSUMER CREDIT AGENCIES IN THE SIXTH FEDERAL RESERVE DISTRICT P e r c e n t a g e C h a n g e A u g . 1942 to S e p t. 1942 V o lu m e O u ts ta n d in g s F e d e r a l C r e d it U n io n s ......................................................... + 3.1 S ta te C r e d it U n io n s ............................................................... — 1.7 In d u s tr ia l B a n k in g C o m p a n ie s ........................................ -f- 5.3 P e rs o n a l F in a n c e C o m p a n ie s ........................................................... . . . — —■ — — million. This amount represents an increase from September 23 of 10.2 per cent. The means of payment in the form of bank deposits subject to check also increased further during October, largely as a result of purchases of Federal obliga tions by member banks. C O N D IT IO N O F FED ER A L R ESERV E B A N E O F ATLANTA ( I n T h o u s a n d s of D o lla rs ) p er C ent C hange O c t 21, 1942, from O c t. 21 S e p t. 16 O c t. 22 S e p t. 16 O c t. 22 1942 1942 1941 1942 1941 Money and Credit: Operation of the Consumer Credit Regulation, coupled with growing inventory shortages in some lines of merchandise and earlier anticipatory buying, resulted in a further decline in consumer credit outstandings from August to September. Monetary circulation continues to increase in this District as throughout the country. On October 21, Federal Reserve notes in actual circulation issued by this Bank totaled $462.7 1. R e ta il in s ta lm e n t p a p e r p u r c h a s e d (a ) A u to m o tiv e ........................................................... (b) O t h e r ........................................................................ 2. D ire c t r e ta il in s ta lm e n t lo a n s (a ) A u to m o tiv e ........................................................... (b) O t h e r ...................................................................... 3. R e p a ir a n d m o d e rn iz a tio n lo a n s (a ) FH A , T itle I, C la s s I .......................................... (b) O t h e r ...................................................................... 4. P e rs o n a l in s ta lm e n t c a s h l o a n s ................................. 5. T o ta l.......................................................................................... 7 3 4.5 1.9 2.1 3.0 B ills d is c o u n t e d ................................... I n d u s tr ia l a d v a n c e s .......................... U. S. s e c u r i t i e s ..................................... T o tal b ills a n d s e c u r i t i e s ............. F. R. n o te c i r c u la t io n ........................ M e m b e r b a n k r e s e r v e d e p o s it s . . U. S. G o v 't d e p o s i t s .......................... F o r e ig n b a n k d e p o s i t s ...................... O th e r d e p o s i t s ..................................... T o ta l d e p o s i t s ................................... T o ta l r e s e r v e s ........................................ I n d u s tr ia l a d v a n c e c o m m itm e n ts . 175 814 191,560 192,549 462,668 411,484 24,338 25,443 2,514 463,779 728,000 135 1,088 802 154,468 156,357 417,575 413,718 228 26,724 2,646 443,316 701,080 142 42 271 93,250 93,562 246,796 286,252 33,729 39,460 7,790 367,231 527,355 1,041 — 84 + 1 + 24 + 23 + 11 — 1 +967 — 5 — 5 + 5 + 4 — 5 + 317 +200 +105 +106 +187 + 44 — 28 — 36 — 68 + 26 + 38 — 87 C O N D IT IO N O F 20 M EM BERS B A N ES IN SELE C TED C IT IE S ( I n T h o u s a n d s of D o lla r s ) P er C ent c h a n g e O c t 21, 1942, fro m O c t. 21 S e p t. 16 O c t. 22 S e p t. 16 O c t. 22 1942 1942 1941 1942 1941 L o a n s a n d I n v e s tm e n ts — T o ta l. 1,053,220 992,417 769,486 340,875 338,342 408,246 L o a n s — T o t a l..................................... C o m m e rc ia l, in d u s tr ia l, a n d a g r i c u lt u r a l l o a n s .................... 198,868 195,389 211,391 O p e n m a rk e t p a p e r .................... 5,314 5,205 5,035 L o a n s to b r o k e r s a n d d e a le r s in s e c u r i t i e s ............. 3,872 4,101 5,764 O th e r lo a n s fo r p u r c h a s i n g a n d c a r r y in g s e c u r i t i e s ......... 7,392 7,353 11,823 R e a l e s ta te l o a n s .......................... 27,997 28,098 37,998 L o a n s to b a n k s ............................. 425 1,144 1,774 97,007 97,052 134,461 O th e r l o a n s ................................... In v e s tm e n ts — T o ta l........................ 712,345 654,075 361,240 U. S. d ir e c t o b l i g a t i o n s ........... 553,356 496,498 177,115 O b lig a tio n s g u a r a n t e e d b y U. S ........... ........................ .. 44,760 46,716 70,453 O th e r s e c u r i t i e s .......................... 109,229 110,861 113,672 R e s e r v e w ith F. R. B a n k ............. 250,436 259,961 184,976 C a s h in v a u l t ..................................... 21,236 22,656 17,736 B a la n c e s w ith d o m e s tic b a n k s . 189,467 196,237 260,563 D e m a n d d e D o s its - a d j u s t e d ......... 725,213 720,632 536,398 T im e d e p o s i t s ................................... 200,311 199,376 195,839 U. S. G o v 't d e p o s i t s ...................... 92,340 38,472 37,429 D e p o s its of d o m e s tic b a n k s . . . . 419,418 434,153 397,609 B o r r o w in g s ............................................................ 2,000 .................... + + 6 1 + 37 — 17 + + 2 2 — 6 + 6 — 6 — 33 + — — — + + 1 0 63 0 9 12 — 37 — 26 — 76 — 28 + 97 +215 — 4 — 1 — 4 — 6 — 3 + 1 + 0 +140 — 3 — 36 — 4 + 35 + 20 — 27 + 35 + 2 +147 + 5 W ar F in an ce a n d M ember B ank Reserves As a result of war expenditures on an enormous scale and participation of banks in financing the war effort, the reserve position of the banking system has changed considerably in the past two years. Between October 16, 1940, and October 14, 1942, the excess reserves1 of all member banks in the United States declined from $6,870 million to $2,710 million. While excess reserves have been declining in total during the war years, the situation as between various Federal Re serve Districts has not been uniform by any means. Indeed, in five Districts—Richmond, Atlanta, Kansas City, Dallas, and San Francisco—excess reserves were a great deal larger in August 1942 than in August 1940. Furthermore, the experi ence of member banks in the money centers has differed great ly from that of Country banks. The decline in excess reserves has been concentrated in the Central Reserve City banks of New York and Chicago. This declining trend has been much less strong in the Reserve City banks and even weaker in the Country banks. Table I illustrates these points. ‘“ E x c e s s r e s e r v e s ” r e p r e s e n t th e d iffe re n c e b e tw e e n t o t a l d e p o s its o f m e m b e r b a n k s w ith t h e i r r e s p e c tiv e F e d e r a l R e s e rv e B a n k a n d th e a m o u n t o f d e p o s its t h a t th e y a r e r e q u ir e d t o h o ld a s a re s e r v e a g a i n s t d e m a n d a n d t i m e d e p o s its . The fall in excess reserves in the country as a whole is the result of two sets of conditions. Table II shows the changes that have taken place in the factors supplying reserve funds and those using reserve funds over the past two years. In the first place, the factors supplying reserve funds operated be tween the autumn of 1940 and the autumn of 1942 in such fashion as to make additional reserve funds available at a much slower rate than had been the case in the years between 1933 and 1940. Secondly, factors using reserve funds operated over the past two years so as to use these funds for purposes other than the building up of member bank reserve deposits. Indeed, total member bank reserve deposits declined from $14,016 million on October 16, 1940, to $12,303 million on October 14, 1942. The inflow of gold was an active factor in supplying re serve funds. In the years from 1933 through 1940, the mon etary gold stock of the United States grew rapidly. The gold stock increased from $4,036 million at the end of 1933 to $21,995 million at the end of 1940. Thereafter, however, the rise was much less rapid and on October 14, 1942, the total 7 4 M o n t h l y R e v ie w of the Federal Reserve B a n k of Atlanta for October 1942 TABLE I EXCESS RESERVES O F MEMBER BANES (A v erag es oi D aily F ig u re s in M illions of D ollars) F e d e r a l R e s e rv e D is tric ts T o ta l B o s to n N. Y ork P h ila . C le v e . R ich. A tla n ta C h ic a g o S t. L o u is M in n . K. C ity D a lla s S. F ra n . C en . B es. C ity B anks A u g u s t 1940 ........................................................... A u g u s t 1942 ......................................................... P e r C e n t C h a n g e .......................................... 3,843 346 — 90 499 60 3,344 286 — 91 —88 R eserv e C ity B anks A u g u s t 1940.......................................................... A u g u s t 1942........................................................... P e r C e n t C h a n g e .......................................... 1,748 1,091 —.3 8 334 61 — 82 21 10 — 52 240 111 — 54 378 196 — 48 82 96 + 17 44 51 + 16 159 133 — 16 106 43 — 59 38 13 — 66 816 812 — 0 105 91 — 13 212 155 — 27 89 69 — 22 73 96 + 32 41 54 + 32 30 47 + 57 134 113 — 16 29 34 + 17 + 6,407 2,248 —.6 5 439 152 — 65 3,577 451 — 87 329 180 — 45 451 292 — 35 123 150 + 22 74 98 + 32 792 306 — 61 135 77 — 43 74 80 8 49 64 + 31 29 30 3 26 39 + 50 31 44 + 42 17 39 + 129 67 43 — 36 100 119 + 19 80 108 + 35 239 272 + 14 — + 222 233 5 C o u n try B anks A u g u s t 1940........................................................... A u g u s t 1942........................................................... P e r C e n t C h a n g e .......................................... All M em ber B anks A u g u s t 1940........................................................... A u g u s t 1942 ........................................................... P e r C e n t C h a n g e .......................................... gold stock amounted to $22,758 million. This growth re flected large and continued gold imports part of which re sulted from the desire of Europeans to transfer capital to the United States for safekeeping in anticipation of unsettled political conditions. Minor factors contributing to the increase in gold stock during the years after 1933 were an expansion of domestic gold production and the reduction in the gold content of the dollar in January 1934. The chief factor reducing member bank reserve deposits over the past two years was the very rapid and continued in crease of money in circulation from $8,229 million on Octo ber 16, 1940, to $13,932 million on October 14, 1942. During the same period, demand deposits of member banks were A n n o u n c em en t The Federal Reserve Bank of Atlanta on October 27, 1942, welcomed the Fidelity National Bank of Baton Rouge, Baton Rouge, Louisiana, to membership in the Federal Reserve System. The Fidelity Bank and Trust Company of Baton Rouge was organized and opened for business on June 7, 1937, under the laws of the State of Louisiana. It is one of three commercial banking institutions in Baton Rouge, the capital of the State of Louisiana, which has a population of about 35,000. On October 27, 1942, the bank was granted a national charter and was au thorized by the Comptroller of the Currency to com mence business as a national bank. It thus became a member of the Federal Reserve System. Its capital and surplus amount to $600,000, and it has deposits of about $7,600,000. In active charge of the operation of the bank is W. L. Ward, Sr., who was President of the Louisiana Bankers’ Association in 1930. Mr. Ward is assisted by Executive Vice President Wm. B. Gladney, Vice Presi dent W. L. Ward, Jr., Assistant Vice President George Herlitz, Cashier Millard G. Redden, and Assistant Cashiers Russell V. Gaudin and Louis W. Borne. The Board of Directors, in addition to W. L. Ward, Sr., W. L. Ward, Jr., and Wm. B. Gladney, includes Robert T. Barber, H. Payne Breazeale, R. Frank Cangelosi, Louis A. Carville, Lancaster W. Collens, Charles H. Hebert, Byran R. Kantrow, George E. Mc Nutt, Harry B. Nelson, Percy E. Roberts, and George M. Wallace. rising and thus the dollar amount of reserves required was in creasing. Time deposits also rose slightly. A breakdown of de mand deposits of member banks by Federal Reserve Districts (Table III) indicates, however, that deposits rose more rap idly in those Districts— Richmond, Atlanta, Kansas City, Dallas and San Francisco—in which excess reserves increased than they have risen in the country as a whole. The explanation is, apparently, that reserve funds have been transferred out of some Districts into others. These trans fers in large part are the result of Federal financial opera tions. Over the past two years Federal expenditures on war account have been rising rapidly and they have now attained an annual rate of approximately $75 billion. Expenditures on such a scale have necessitated accelerated Federal borrowing and the bulk of the borrowed funds has been raised in the money markets of New York City and Chicago. Much of the military mobilization, however, has taken place outside of the New York and Chicago areas so that it has been necessary for the Treasury to transfer funds to other centers. The drain of TABLE II THE SUPPLY AND USE O F RESERVE FUNDS (In M illions of D ollars) SUPPLY G o ld S to c k ....................................................................... T r e a s u r y C u r r e n c y ..................................................... R e s e r v e B a n k C r e d i t ................................................... U n ite d S ta t e s G o v e r n m e n t s e c u r i t i e s ........... A l l O t h e r ....................................................................... T o ta l S u p p l y ................................................................... U SE M e m b e r B a n k R e s e r v e B a l a n c e s ........................ M o n e y in C ir c u la t io n ................................................. T r e a s u r y C a s h .............................................................. T r e a s u r y D e p o s its w ith F e d e r a l R e s e r v e B a n k s .............................................................................. N o n m e m b e r D e p o s its a n d O th e r F e d e r a l R e s e r v e A c c o u n t s ................................................... T o ta l U s e ........................................................................... O c t. 16 1940 O c t. 14 1942 Per C ent C hange 21,373 3,053 2,481 (2,384) ( 98) 26,907 22,758 3,360 4,042 (3,809) ( 233) 30,160 + 6.5 -j- 10.1 -j- 62.9 + 59.8 + 1 3 7 .8 + 12.1 14,016 8,229 2,268 12,303 13,932 2,228 — 12.2 + 69.3 — 1.8 463 123 — 73.4 1,931 26,907 1,574 30,160 — 18.5 + 12.1 TABLE III DEMAND DEPOSITS O F MEMBER BANKS (In T h o u san d s of D ollars) F e d e ra l J u n e 29 R e s e rv e D is tric ts _____ 1940 T O T A L ............................................................ 39,659,398 B o s to n ............................................................ 2,240,392 N e w Y o r k ..................................................... 16,878,622 P h ila d e lp h i a ............................................... 2,142,064 C l e v e l a n d ..................................................... 2,529,726 R ic h m o n d ..................................................... 1,436,693 A tla n ta ............................................................ 1,362,642 C h i c a g o ........................................................ 5,459,916 St. L o u i s ....................................................... 1,279,566 M in n e a p o lis ................................................. 762,569 K a n s a s C i t y ................................................. 1,510,356 D a ll a s .............................................................. 1,335,486 S a n F r a n c i s c o ............................................. 2,721,366 J u n e 30 _____1942 51,168,041 2,796,695 19,714,451 2,640,136 3,609,829 2,108,875 1,973,206 7,523,694 1,859,573 1,010,232 2,106,729 1,866,307 3,958,314 P er C ent C hange + 29.0 + 24.8 + 16.8 + 23.3 + 42.7 + 46.8 + 44.8 + 37.8 + 45.3 + 32.5 + 39.5 + 39.7 + 45.4 M o n t h ly R e v ie w of the Federal Reserve B a n k of Atlanta for October 1942 7 5 T A B L E IV UNITED STATES GOVERNMENT OBLIGATIONS. DIRECT AND GUARANTEED. HELD BY WEEKLY REPORTING MEMBER BANKS (In M illions oi D ollars) F e d e r a l R e s e r v e D is tric ts T o tal B o s to n N. Y ork P h ila . C le v e . 689 2,627 20 150 335 942 0 115 8 146 3 77 2 68 249 610 10 78 0 72 24 116 36 79 2 174 0 3,044 0 161 0 1,186 0 78 0 175 0 89 0 91 0 740 0 140 0 64 0 87 0 79 0 154 1,811 3,235 38 108 987 1,770 29 75 145 230 113 95 36 105 257 354 32 70 20 39 56 113 33 74 65 202 6,783 11,132 343 560 2,875 4,609 335 531 637 1,029 205 439 111 232 1,092 1,766 158 304 121 189 95 205 92 211 719 1,057 2,605 2,111 54 67 1,508 1,189 93 68 134 137 66 64 66 47 272 247 72 35 28 20 75 68 46 39 191 130 ............. 11,888 ............... 100.0 ............. 22,149 ............... 100.0 455 3.8 1,046 4.7 5,705 48.0 9,696 43.8 457 3.8 867 3.9 924 7.8 1,717 7.8 387 3.2 764 3.4 215 1.8 543 2.5 1,870 15.7 3,717 16.8 272 2.3 627 2.8 169 1.4 384 1.7 250 2.1 589 2.7 207 1.7 482 2.2 977 8.2 1,717 7.8 R ich. A tla n ta C h ic a g o St. L o u is M in n . K. C ity D a lla s S. F ra n . Billa O c to b e r 16, 1940............................... ............... O c to b e r 14, 1942................................................ C ertificates O c to b e r 16, 1940................................. .............. O c to b e r 14, 1942................................................ N otes O c to b e r 16, 1940................................. ............. O c to b e r 14, 1942................................. ............... B onds O c to b e r 16, 1940................................. ............... O c to b e r 14, 1942................................. ............... G u a ra n te e d O c to b e r 16, 1940................................. ............. O c to b e r 14, 1942................................. ............. Total O c to b e r 16, 1940................................. P e r C e n t ............................................ O c to b e r 14, 1942................................. P e r C e n t ............................................ reserve funds has persisted because the interior banks—and this is particularly true of those in the “country” classifica tion—have in turn not increased their holdings of Federal debt offerings to the same degree that funds have been trans ferred out of the New York and Chicago markets. The extent to which the New York and Chicago Reserve Districts hold government securities is revealed in Tables IV and V. Table IV shows the amount of United States govern ment securities, direct and guaranteed, held by weekly report ing member banks in the various Federal Reserve Districts. While it is realized that the weekly reporting sample does not adequately reflect the position in the Country banks, the material is included because it is the most recent available and because it makes possible a breakdown of security hold ings on the basis of types of obligations. Table V covers all member banks for the period June 29, 1940, to June 30, 1942. There are several ways of meeting the wartime financial needs of the Federal Treasury. The Victory Fund Committees, and other individuals and organizations, are facilitating the placement of large quantities of Federal obligations outside the banking system. To the extent that borrowing from non banking sources is inadequate, securities must be sold to banks. Bank purchases of securities increase deposits and put an added drain on reserves. Reserves can be replenished in several ways. Rediscounts are available to tide member banks over periods of temporary reserve shortages. The Federal Reserve Banks continue to provide reserve bank credit through large purchases of Fed eral obligations on the open market. Reserve requirements of member banks may be reduced, thus freeing additional funds for the purchase of additional Federal debt offerings. The achievement of a wider dispersion of Federal obligations through the banking system will make it possible to utilize available reserves more completely. To encourage such a wider dispersion of Federal obligations owned by banks the Federal Reserve Banks have recently adopted the policy of buying at a rate of % per cent all Treasury bills presented to them. The offering bank may retain the option to repurchase at the same rate if it so desires. Treasury bills thus become for all practical purposes as liquid as excess reserves. The Board of Governors of the Federal Reserve System has recently reduced reserve requirements in the Central Reserve Cities of New York and Chicago. This action had the effect of making additional reserves available to the member banks in those cities. Reserve requirements in New York and Chicago have been reduced from 26 to 20 per cent of net demand de posits within the past three months. This action was taken in three steps. Requirements were reduced from 26 to 24 per cent on August 20, to 22 per cent on September 14, and to 20 per cent on October 3. Reserve requirements against net demand deposits are now 20 per cent both in Central Reserve and Reserve Cities and 14 per cent for the Country banks. The requirement against time deposits remains at 6 per cent for all member banks. TABLE v Industrial activity expanded further in September and the first half of October. Prices of uncontrolled commodities continued to advance in September. Early in October an Office of Economic Stabilization was established with a view to more effective control of prices and wages affecting the cost of living. Production: Industrial production increased more than sea sonally in September and the Board’s adjusted index rose 2 points to 185 per cent of the 1935-1939 average. Armament production continued to advance. Steel production was main tained at a high level during September and then increased during October, reaching 101 per cent of rated capacity in the third week of the month. Cotton consumption continued UNITED STATES GOVERNMENT OBLIGATIONS, DIRECT AND GUARANTEED. HELD BY MEMBER BANKS IN THE VARIOUS FEDERAL RESERVE DISTRICTS (In M illions ol D ollars) F ed eral R e s e r v e D is tr ic ts ______J u n e 29, 1940______ A m ount P er C ent TO T A L ....................................................... B o s to n ....................................................... N e w Y o rk ................................................ P h ila d e lp h i a ............................................ C l e v e la n d ................................................ R ic h m o n d ................................................ A tla n ta ....................................................... C h ic a g o ..................................................... S t. L o u is ................................................... M in n e a p o lis ............................................ K a n s a s C it y ............................................ D a ll a s ......................................................... S a n F r a n c i s c o ........................................ 14,722 641 6,363 748 1,148 507 327 2,299 368 285 356 276 1,405 100.0 4.4 43.2 5.1 7.8 3.4 2.2 15.6 2.5 1.9 2.4 1.9 9.5 _____ J u n e 30, 1942 A m ount P er C ent 24,098 1,195 10,073 1,18 1 1,916 905 671 3,771 715 455 594 500 2,122 100.0 5.0 41.8 4.9 8.0 3.6 2.9 15.6 3.0 1.9 2.5 2.1 8.8 The N ational Business S ituation (Prepared by the Board of Governors of the Federal Reserve System) M 7 6 o n t h l y R e v ie w of the Federal Reserve B a n k of Atlanta for October 1942 at a high rate and output of manufactured food products rose budget and now the proportion of the total under control more than seasonally owing chiefly to increased activity in the is about 90 per cent. Another action directed residential rents meatpacking and canning industries. Coal production, which throughout the country to be limited to the levels of March 1, had been maintained in large volume during the summer 1942, wherever rent control procedures were not already in months, did not show the usual sharp seasonal rise in Sep effect. tember and the first half of October. Output of crude petrol Agriculture: The October 1 official crop report confirmed eum showed little change following considerable increase in earlier prospects that unusually heavy crop yields were in August. sight. The Department of Agriculture pointed out, however, Value of construction contracts awarded in September was that, as the harvest progresses under difficulties, particularly about the same as in August, according to reports of the as to labor supply, farmers are showing less assurance that it F. W. Dodge Corporation. As in other recent months, awards can be completed in season. Record crops of grain, hay, oil were mainly for publicly-financed work which, in September, seeds, sugar, vegetables, and probably fruits are still likely. amounted to over 90 per cent of the total. Bank Credit: Following a temporary peak of 3 billion dol Contracts for manufacturing buildings reached the highest lars in mid-September, excess reserves of member banks de total yet reported, and increased awards for defense housing clined to 1.7 billion dollars in the latter half of September raised the total for residential building by about one-fourth but increased considerably in the first three weeks of October. despite a decline in privately-financed work. Awards for pub This increase resulted in part from the action of the Board of lic works and utilities and for commercial buildings dropped Governors of the Federal Reserve System in reducing reserve substantially. requirements on demand deposits at central reserve city banks Distribution: Department store sales, which had been un from 22 to 20 per cent, which added about 400 million dol usually large in August, showed somewhat less than the usual lars to excess reserves. In addition member bank reserves sharp seasonal rise during September. In the first half of were increased through purchases of Government securities October sales were sustained near the high level prevailing by the Federal Reserve Banks. As a result of these develop at the beginning of the month. Variety store sales increased ments excess reserves of all member banks on October 21 seasonally from August to September, while sales in small amounted to 2.4 billion dollars, of which about 500 million towns and rural areas rose by more than the usual seasonal dollars were in New York City. amount. At reporting banks in leading cities heavy purchases of new Railroad freight-car loadings increased further in Septem Treasury certificates of indebtedness and Treasury notes were ber and the first half of October. The rise was small for this reflected in an increase of 1.6 billion dollars in Government time of year, however, owing mainly to the fact that ship security holdings during the four weeks ending October 14. ments of many commodities, particu Further large increases occurred in the INDUSTRIAL PRODUCTION larly coal, had been maintained at un following week as banks received their usually high levels during the summer allotments of the new ll/£> per cent notes h months. and 2 per cent bonds. Commercial loans, after declining in August and Septem Commodity Prices: Prices of uncon ber, increased in the first two weeks of trolled commodities advanced further in October, mainly in New York City, September. During the first half of Oc while other loans declined further. tober, after passage of an amendment to the Price Control Act of 1942, more United States G overnm ent Security — fl widespread controls were announced. Prices: Prices of United States Govern A - \ /J Maximum prices at the highest levels — \ ment securities continued steady last x / reached around the end of September month. Long-term taxable bonds are were established for butter, cheese, eggs, yielding 2.33 per cent on the average and various other foods. These items F e d e r a l R e s e rv e m o n th ly in d e x o i p h y s ic a l v o lu m e and long-term partially tax-exempt p r o d u c t io n , a d j u s t e d io r s e a s o n a l v a r ia tio n , constitute nearly one-third of the food of bonds are yielding 2.05 per cent. 1935-39 a v e r a g e — 100. L a te s t f ig u r e s s h o w n a r e fo r S e p te m b e r 1942. FREIGHT-CARLOADINGS COST OF LIVING MEMBER BANKRESERVES or WUMI M.UOW TOTAL V or DOLtm jvi A > VV J w y1 REQUIRED RESERVESJ] "‘ ’ " a r EXCESS RESERVES F e d e r a l R e s e r v e m o n th ly in d e x of to ta l lo a d in g s of r e v e n u e f r e ig h t, a d j u s t e d fo r s e a s o n a l v a r ia tio n , 1935-39 a v e r a g e = 100. S u b g r o u p s s h o w n a r e e x p r e s s e d in te r m s of p o in ts in th e to ta l in d e x . L a te s t f ig u r e s s h o w n a r e fo r S e p te m b e r 1942. ( , _J -... \ W e d n e s d a y f ig u r e s . R e q u i r e d a n d e x c e s s r e s e r v e s , b u t n o t th e to ta l, a r e p a r t ly e s tim a te d . L a te s t f ig u r e s s h o w n a r e fo r O c to b e r 14, 1942. B u r e a u o f L a b o r S ta t is tic s ' in d e x e s , 1935-39 a v e r a g e = 100. F if te e n th of m o n th f ig u r e s . L a s t m o n th in e a c h c a le n d a r q u a r t e r t h r o u g h S e p te m b e r 1940, m o n th ly th e r e a f te r . L a te s t f ig u r e s s h o w n a r e for S e p te m b e r 1942.
@FedFRASER