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On the State of the Economy Iso m this issue: HOW HAVE DISTRICT BANKS BEEN DOING? THE CHANGING SOUTHERNER SIXTH DISTRICT STATISTICS DISTRICT BUSINESS CONDITIONS It is flattering to have been asked to appear before you today. After an examination of conscience, however, I find my sense of self-esteem greatly reduced by the necessity of confessing that I have no new figures and no new and revealing arrangement of old figures. I think I should also confess— and this is done out of no sense of false modesty—that I do not know the answers to the problems that beset us. At the moment, without trying to support the point with figures, it seems to me that we are churning around at a high level of economic activity, perhaps even edging upward a little, all without going any where in a hurry. Whether this slowdown in our rate of expansion will be followed by a break-out on the upside, with continued recovery, or on the downside, I do not know; but I am sure that when the facts are in, it will appear to everyone, including myself, that I ought to have known. Let me state a few convictions for whatever they may be worth: 1. If we break out of this pause on the downside, there is no pres ently visible, objective, rational reason why the period of adjustment should be long and deep. It will only be long and deep if we take counsel of our fears and frighten each other into panic. If we do this, then we are stupid. 2. It is inevitable, in the normal misjudgments of human beings, especially when correct judgments are made the more difficult by a long inflationary cycle such as this country has had, that there will appear a thousand and one misapplications of capital and manpower that find a less-than-expected market for their products and services. It is possible, to be sure, that we shall be unpleasantly surprised by the magnitude and extent of the adjustments that may be necessary. I myself believe that they are of a size and magnitude small enough that our dynamic economic system can accommodate itself to them. What chiefly scares me is that we shall attempt to over-manage the economy, wherein I think our last case may well be worse than our first. What is continuously needed is not a single adjustment but a myriad of adjustments. These can only be made by a flexible economy whose decisions related to manpower and capital are under the day-to-day guidance of free consumer and free investor choices. I realize that an economy guided by a free market is often an uncomfortable thing to have around; a free market often seems to behave miserably. Unfortu nately, in my judgment, there is no substitute for it. So I bespeak my conviction that we should at this time be guided by two general philosophies: a. Speaking simply as an American citizen, I think we should see to it that the pains of readjustment do not fall with over whelming and degrading force on the unemployed, which is the tragic and classic locale of most of those pains. I believe we are bound in conscience not to let that happen. NOTE— Statement of M alcolm Bryan, President of the Federal Reserve Bank of Atlanta, before the Joint Economic Committee, Washington, D. C., August 15, 1962. b. Again, speaking simply as an American citizen, I believe we should do the things we know that Gov ernment can do and do well. We should see that competition is maintained in all sectors of the econ omy; we should see that the consumer is protected against the sharp practice of an occasional scoundrel; we should see that he is protected in those areas where his quality judgments do not suffice. Even, if I dare say it, I think we should strive studiously to avoid rigidities introduced into the economy by Gov ernment itself. After that, I believe we shall be well advised to give the free market economy a chance to adjust itself before we intervene with massive medi cations. I shall make a slight further allusion to this point in a minute or so. Now, as for monetary policy. As I see it, monetary policy in most of the postwar period can be interpreted around a few simple ideas. First of all, we have been striving to bring inflation to an end, but to bring it to an end so gently and so grad ually that American businesses, individuals, governments, and the managers of savings institutions could continually examine their commitments in the light of a gradually evolving situation, not in the light of a sudden and dra matic alteration in their environment, which would neces sitate sudden, large, and dramatic adjustments. Put in a different frame of reference, we have been feeling our way slowly toward a viable structure of inter est rates that will attract from the American people as savers the large bulk of the funds that other Americans, American governments, and our offshore friends want to borrow. Note, however, a point so many times made: The Federal Reserve System has had no intellectual or emo tional preoccupation with either high interest rates or low interest rates, as such. We have merely wanted an interest rate— the price for money— that largely equates the sup ply of savings that Americans are willing to furnish at that price with the demand for American savings at that price. At the same time, we have allowed for a growth of bank reserves intended to accommodate a growth in the money supply, which has been intended in turn to accom modate the increasing population and the increasing trans actions of our country. That growth of reserves over the long postwar period exhibits a straight-line trend of 3 percent per annum. I do not believe that this has been a tight money policy. Indeed, if it is to be criticized, I think the criticism over the long period is that it may have been too easy, delaying adjustments that, considering the constant change in a consumer-guided economy, are forever necessary and are the easier the more promptly they are made; if we are to be criticized, I suspect the criticism is properly taken on the point that we have allowed too much of the economy’s expansion to be financed out of bank created credit. Second, speaking not to the long term but to our re action toward cyclical situations, we have had an extra ordinarily simple pattern. Whenever we could detect a downward trend in economic activities, we have acted promptly to increase the supply of bank reserves and thus to permit banks to seek loans and investments and, in turn, to increase the money supply. By the same token, when we have detected the economy operating in condi tions of boom, we have allowed borrowing demands to press against bank reserves and interest rates to call up a greater supply of real savings. The pattern has been as simple as that. Our counter cyclical actions, whether by luck or sophistication I do not know, seem to me to have had an excellent result. We have avoided in postwar America a long or severe depres sion of the sort that has characterized other postwar pe riods, and the economy has responded when we have tried to stimulate it by monetary means. Now, let me go back to a point made a short while ago. In endeavoring to stimulate the economy we have in creased bank reserves, after adjusting for changes in re serve requirements, from the low point in April 1960 of $18.2 billion to $20.0 billion (daily average basis) in July 1962. This has amounted to a 10-percent increase. Note that the figure for total reserves, both on a seasonally adjusted and unadjusted basis, stands comfortably above the long-run 3-percent growth rate in bank reserves. In short, we have had an easy money policy. The commercial banks of this country have responded to this easy money policy by expanding their loans and investments $31.2 billion, seasonally adjusted, or 16.8 percent, between April 1960 and July 1962. Still, we must all agree that the economy, while it has responded to monetary ease, has not recently been re sponding altogether to the heart’s desire. Although the figures, I believe, give an exaggerated impression, we have an uncomfortable overcapacity in many lines. True, the figures for July were somewhat heartening, but unemploy ment remains higher than it should be. This leads me to an uneasy suspicion that something is happening in the economic system that we do not quite understand. Since I must frankly say that I do not believe it to be a lack of money availability, I believe a search for what is happening to our economy must take other directions; we need an agonizing reappraisal of some of the other elements of our total national policy. Mean while, with so many doctors disagreeing, I think we would be smart to postpone any exploratory operations or mas sive medications. It seems to me that the economy is like a man slightly afflicted with hypochondria who goes to his physician for a regular check-up and mentions that he has not been feeling as peppy of recent weeks as he had been. I think the physician in such a case would be wise and prudent to keep the patient under observation for a time before he begins dosing him either with tranquilizers or stimulants. Neither may be needed. With the art of economic diagnosis what it is, I feel that we should all be wise to pause a while and to find out, as best we can, what is actually happening in the economy before we begin dosing it. Such a suggestion may have the defect of being a little behind hand in the beginning of treatment, if treatment is needed; it has the enormous advantage of assuring that the patient is not treated with a medicine that aggravates, rather than remedies, his condition. That leads to a further question. Do I believe that ad ditional injections of easy money would help the economy at this time? I do not. •2 • How Have District Banks Been Doing? Key indicators show that activity at District member banks has been in a rising phase throughout most of this year. Loans and investments, seasonally adjusted, rose $644 million in the first seven months, substantially more than in the same period of 1961. During the three months end ing in July, however, loans and investments rose at a monthly average rate of 0.5 percent, compared with an aver age rate of 1.3 percent in the first four months of this year. Member bank loans, seasonally adjusted, increased $257 million between December 1961 and July 1962. After pausing in the early months of this year, loan expansion picked up, particularly at banks in major District cities. In recent months, moreover, loan expansion has been stronger there than in smaller cities and towns. Further, it has been concentrated primarily in consumer and real estate loans. Banks in Florida and Georgia accounted for the bulk of the dollar increase in loan volume this year, although banks in all other District states registered gains. Growth in investments at member banks accounted for the major share of this year’s expansion in total loans and investments. Bankers added substantially to their holdings of state and local government securities partly in an effort to invest a portion of the heavy inflow of time deposits in high-yielding securities. Bankers also con tinued to acquire U. S. Government securities maturing within a year; they reduced their holdings of securities in the one to five-year range but increased their holdings of longer-term issues. The rise in loans and investments so far this year has been accompanied by a comparable increase in total de posits. Expansion in total deposits at member banks has been dominated by a spectacular rise in time deposits. Such deposits, not adjusted for seasonal influences, in creased over $500 million in the first seven months of 1962, about three-fifths more than in the same period of 1961. In recent months, a moderate slowdown in the ex pansion in time deposits, combined with little change in de mand deposits, has reduced the pace of total deposit growth. Bank reserve positions have been easy throughout the period since the recession trough in February 1961. Since that date member banks have been able to expand loans and add to their security holdings. At the same time, they have retained a sizable volume of excess reserves and kept almost completely out of debt to the Atlanta Federal Reserve Bank. Expansion in seaso nally adjusted loans and investments a t District member banks has continued throughout 1962, but has slowed somewhat in recent months. I9 6 0 1961 1962 Total deposits of member banks, not adjusted for seasonal influences, have also increased throughout this y e a r because of a sharp rise in time deposits. Billions of Dollars Billions of Dollars Throughout 1962, excess reserves at member banks have been am ple, and borrowing from the Atlanta Federal Reserve Bank has rem ained at a low level. Millions of Dollars Millions of Dollars The Changing Southerner If the typical lawyer, banker, grocer, millhand, or house wife were asked to list some of the most important signs of economic change that took place in the South in the 1950’s, he would probably answer “fewer farms,” or “new industries,” or “more shopping centers,” or “better job op portunities,” or “new housing developments.” These and other changes have been continuously spotlighted in the region’s newspapers and magazines, intoned by its politi cians, and publicized by its development organizations. Knowledge of these happenings has virtually become part of the basic education of the present-day Southerner. As important as these changes are, they actually only describe the causes or effects of a more fundamental economic development in the South— a continued rapid •3 • Percentage of Population That Completed One or More Y ears of High School High school enrollm ent rose ste a d ily through 1960 . . . Sixth District States, 1950 and 1960 Total 1950 1960 Urban 1950 1960 Rural Nonfarm 1950 1960 Rural Farm 1950 1960 White 1950 1960 Non white 1950 1960 Ala. Fla. Ga. La. Miss. Tenn. 38.7 50.7 53.8 62.6 38.4 50.2 37.1 48.1 37.7 48.5 39.4 46.7 50.2 59.4 59.0 65.1 48.0 58.0 45.5 54.8 53.5 61.5 51.5 56.9 34.9 41.5 45.0 55.0 34.9 41.3 29.2 38.1 42.9 43.5 35.1 38.2 22.9 34.5 31.4 47.2 22.4 35.0 19.6 30.0 24.5 34.3 22.6 29.4 47.9 58.8 62.3 67.9 48.2 59.1 48.2 58.9 56.5 65.2 43.0 49.8 16.8 27.6 18.9 30.8 13.0 23.9 11.6 22.1 10.8 18.7 20.6 29.5 rate of income growth. Basic to this income gain was a substantial upturn in productivity—the output per worker. The income per person in the South increased at a rate well above that of the nation as a whole during the 1950’s, which implies that the region’s work force also improved its productivity at a faster rate than the nation’s. Why have Southerners increased their ability to pro duce, measured both by past performance and by national standards? There are several reasons. For one thing, there was a substantial shift from employment in farming, lum bering, textile production, and other industries tradition ally yielding a small output for each unit of labor used to employment in petroleum production, durable goods man ufacturing, and other high productivity industries. This shift, which was more pronounced in the South than in the nation, was accompanied by increased capital invest ment in the form of new plants and modernization of old facilities. Concomitant with both of these developments were technological improvements in all fields of endeavor. Another important factor in the increased efficiency of Population changes groups . . . varied sharp ly among District age Southern workers was the changing characteristics of the people themselves. Among other things, the educational attainments of the population rose more than in the na tion, increasing the ability of Southerners to cope with the demands of more complex methods of production. Also, the gap between the South and the nation in the proportion of the population in the productive age groups was sharply reduced. The age make-up of the population is an important determinant of both productivity and the resulting income distribution. First, a small percentage of people in the 30 to 64 age group would indicate that the proportion of experienced, and presumably more skilled, workers is relatively small. Second, a large percentage of the population in the less productive age groups (19 and under and 65 and over) would mean that the income re sulting from any level of productivity must be spread out thinner. The 1960 Census provides us with detailed data on educational attainment and age distribution, two of the most significant measures of the potential productivity of resulting groups. in a shift tow ard the younger and olde Percent Change - I960from1950 19 and U nder 2 0 -2 9 1 0 -4 4 4 5 -6 4 6 5 and O ver 19 and U n der 20 - 29 30 - 44 45 - 64 • 4 • 6 5 and O ver . . resulting in a substantial upturn in the amount of ducation received by District adults. Nevertheless, wide gaps in educational attainment remained between various groups. PercentofPersonsOver25 YearsofAge WhoHaveCompletedOneor MoreYearsofHighSchool 0 20 40 Percent of Persons Over 25 Years of Age Who Have Completed One or More Years of High School Urban W hite Rural Nonfarm W hite Rural Farm W hite Urban Nonwhite Rural Nonfarm Nonwhite Rural Farm Nonwhite M iss. Tenn, U .S. the people. A look at some of the changes in these factors that have taken place among the people who live in the Sixth Federal Reserve District states—Alabama, Florida, Georgia, Louisiana, Mississippi, and Tennessee— will pro vide a basis for recognizing the gains that have occurred in the region's productivity and the shortcomings that still exist. Better Educated Southerners The table and charts appearing at the top of these pages indicate that the number of people in this part of the South with more than a grammar school education increased much more rapidly than did the adult population between 1950 and 1960. There was, for example, a 58-percent jump in the number of people over 25 who had completed one or more years of high school, compared with a popu lation gain of only 24 percent in that age group. Further more. the proportion of the region’s adults who had achieved this level of education advanced from 79 percent of the national average in 1950 to 87 percent in 1960. The increase in the number of the region’s college grad Although the median age of the total population remained almost unchanged, significant changes took place in several residence and racial groups. Median Age “ 1950 and I960 White Nonwhite Nonfarm White Nonfarm Nonwhite Farm White Farm Nonwhite uates was even more impressive. The 1950 total of 418,000 had jumped to 717,000, or 71 percent, by 1960, compared with an increase of 44 percent in the nation as a whole. Despite the overall gains in education made by people living in District states in the past decade, inadequate preparation for the demands of industry remains a prob lem for large segments of the population. In 1960, only one population group in this region— the urban white class— exceeded the comparable group in the nation in the percentage of those who had received more than grammar school training. At the other end of the scale, the percentage of rural farm nonwhite adults who had achieved this level of education was only half the national average. The proportion of all rural adults who had attended high school was only about two-thirds of the urban average. Southerners Become Younger and Older The age distribution in District states was much more similar to the nation’s in 1960 than it was a decade earlier. Although the proportion of the population in the non Median Age of the Population Sixth District States 1950 and1 1960 Total 1950 1960 Urban 1950 1960 Rural Nonfarm 1950 1960 Rural Farm 1950 1960 White 1950 1960 Nonwhite 1950 1960 Ala. Fla. Ga. La. Miss. Tenn. 25.5 25.9 30.9 31.1 26.2 25.9 26.7 25.3 24.6 24.1 27.3 26.9 27.8 26.9 32.8 32.5 28.7 27.2 28.7 26.3 28.2 26.0 29.3 28.7 24.7 24.2 27.3 26.7 24.7 23.9 24.9 23.3 26.2 23.6 25.2 25.6 21.5 26.1 25.6 31.7 21.8 25.2 21.6 22.6 20.9 20.7 25.2 30.9 26.7 28.1 32.0 32.9 27.4 27.7 28.0 27.4 27.3 28.5 27.2 28.7 22.7 20.4 27.2 23.0 23.1 20.9 23.9 20.5 21.3 18.6 27.4 23.8 • 5 • productive age groups increased here, largely as a result of a sharp jump in the birth rate following World War II, the gain was much smaller than in the nation. At the same time the percentage of the region’s population in the broad 30 to 64 age group remained unchanged as the nation’s proportion dropped, resulting in a sharp decline in the gap between the two areas. As divergent as the population changes for various age groups in the District’s total population were, shifts among residence and racial groups were even more dramatic. For example, the median age of the white rural farm popula tion increased from 25.4 years in 1950 to 33.3 years in 1960, reflecting the large-scale movement of young people from the farms to the cities or to nonfarming jobs in the rural areas. The median age of nonwhite urban dwellers, on the other hand, dropped 4 years during the decade. Still Room for Improvement Many factors contributed to the vast changes that took place in these important characteristics of the population during the 1950’s: the rapid advances being made by the nation’s economy; the desire of Southerners to share in these gains; the mobility of the population, which led to a wholesale exodus of people from farms to cities and the migration of many Southerners, particularly those in the lower income groups, away from this region; and the movement of many non-Southerners to District states, especially Florida. The gaps in population characteristics between the na tion and the region have by no means been closed alto gether, despite the progress made by District states. Wide differences in educational achievement remain between the nation and this part of the South, particularly for the rural and nonwhite people. The differences are magnified because of the disproportionate ratios of these groups to the total population in the District. This region still has a larger portion of nonproductive persons, as measured by age, and a smaller proportion of experienced workers in its population than does the nation as a whole. A continuation of recent trends will mean that the major characteristics of the South’s population will more closely resemble those of the country as a whole in the Bank Announcements On August 9, the newly organized nonmember Peoples Bank of Stuart, Stuart, Florida, opened for business and began to remit at par for checks drawn on it when re ceived from the Federal Reserve Bank. Officers include W. H. Boyette, President; James H. Reardon, Jr., Vice President; and Donald L. Bowden, Cashier. Capital totals $400,000, and surplus and undivided profits, $140,000. On August 17, the First National Bank of South Miami, South Miami, Florida, through a conversion of the par-remitting, nonmember First Bank & Trust Com pany of South Miami, became a member of the Federal Reserve System. Officers are Omar E. Stang, President; L. B. Hedgpeth and A. E. Metzger, Vice Presidents; Robert Faltings and George L. Mendes, Jr., Vice Presi dents and Trust Officers; and John W. Roberts, Jr., Cashier. future. Only as the gaps between the various population groups are further narrowed can the South hope to raise the productivity of its people to, or above, the national average. As this occurs, the region will be in a better position to compete for the more efficient industries, and in turn this will help to narrow the differences between the South’s and the nation’s people. „ r r R o ber t M. Y oung Debits to Individual Demand Deposit Accounts (In Thousands of Dollars) July 1962 June 1962 July 1961 ALABAMA 49,485 Anniston . . . . 46,855 41,553 904,396 900,857 Birmingham . . . 804,495 36,932 35,782 Dothan . . . . 39,446 Gadsden . . . . 37,692 37,438 33,576 82,344 Huntsville* . . . 85,541 67,183 310,250 295,028 285,952r Mobile . . . . Montgomery . . . 186,084 180,519 172,116 25,507 27,508 22,617 Selma* . . . . 60,822 68,544 Tuscaloosa* . . . 55,209 1,670,817 l,518,483r Total Reporting Cities 1,704,431 801,897 797,584r 731,824r Other Citiesf . . . FLORIDA n.a. Bradenton* . . . 47,525 50,460 63,915 Daytona Beach* 57,374 56,398 Fort Lauderdale* . 205,284 206,362 190,659 46,764 48,980 39,486 Gainesville* . . . 864,320 824,453 Jacksonville . . . 756,086 Key West* . . . 15,179 15,619 18,803 Lakeland* . . . 82,331 84,909 76,701 986,633 961,671 826,162 Miami . . . . Greater Miami* 1,415,103 1,399,464 1,238,697 Orlando . . . . 263,759 267,603 253,877 89,264 Pensacola . . . 86,590 83,104r St. Petersburg . . 230,362 215,484 214,586 84,183 79,128 n.a. Sarasota* . . . 74,252 n.a. Tallahassee* . . 65,886 Tampa . . . . 394,587 439,288 440,503 W. Palm-Palm Bch.* 161,366 154,065 140,461 Total Reporting Cities 4,083,845 3,999,114 3,460,261r Other Citiesf . . . 1,708,970 1,719,264r l,677,403r GEORGIA Albany . . . . 59,703 57,694 51,099 Athens* . . . . 48,303 44,178 44,138 Atlanta . . . . 2,597,671 2,445,592 2,171,330 121,214 119,037 Augusta . . . . 126,448 Brunswick . . . 31,171 26,621 37,173 Columbus . . . 120,944 118,268 109,972 Dalton* . . . . 52,922 49,989 n.a. Elberton . . . . 11,017 12,254 8,630 Gainesville* . . . 54,096 53,836 49,234 Griffin* . . . . 23,586 21,219 18,816 16,214 LaGrange* . . . 17,866 15,821 Macon . . . . 147,490 139,389 121,777 Marietta* . . . 37,935 36,345 32,889 Newnan . . . . 20,422 22,460 20,251 Rome* . . . . 54,945 48,584 45,525 178,992 Savannah . . . 179,977 172,050 Valdosta . . . . 37,725 31,759 35,527 Total Reporting Cities 3,617,419 3,439,962 3,042,717 Other Citiesf . . . 1,031,287 983,587r 935,447r LOUISIANA 80,851 81,616 Alexandria* . . . 67,136 Baton Rouge . . 289,462 310,663 258,177 Lafayette* . . . 68,735 68,657 62,520 Lake Charles . . 87,178 88,093 81,327 New Orleans . . . 1,517,444 1,499,848 1,319,839 Total Reporting Cities 2,064,871 2,027,676 1,788,999 Other Citiesf . . . 652,068 654,502r 568,822r MISSISSIPPI Biloxi-Gulfport* . 68,890 58,128 52,419 Hattiesburg . . . 39,322 38,573 38,408 Jackson . . . . 347,102 347,487 308,903 Laurel* . . . . 28,809 28,776 29,159 Meridian . . . . 52,162 46,817 45,333 Natchez* . . . . 25,332 24,909 21,528 Vicksburg . . . 23,999 23,136 21,985 Total Reporting Cities 584,867 568,575 517,735 Other Citiesf . . . 299,787 281,274r 272,294r TENNESSEE Bristol* . . . . 51,274 56,325 48,512 Chattanooga . . 363,380 344,743 335,828 Johnson City* . . 48,975 50,015 41,536 Kingsport* . . . 92,676 93,171 87,614 Knoxville . . . . 271,971 270,188 255,435 Nashville . . . . 869,596 826,295 833,330 Total Reporting Cities 1,697,872 1,640,737 1,602,255 Other Citiesf . . . 664,775 674,506r 634,691r SIXTH DISTRICT . 18,912,086 18,457,598r 16,750,931r Reporting Cities 13,753,302 13,346,881 ll,930,450r Other Citiesf . . 5,158,784 5,110,717r 4,820,481r Total, 32 Cities . . 11,610,210 11,239,524 10,236,735r UNITED STATES 344 Cities . . . 279,700,000 291,800,OOOr247,700,000 Percent Change Year-to-date 7 months July 1962 from \qbZ June July from 1962 1961 1961 +6 +0 —6 +1 +4 +5 +3 —7 + 13 +2 +1 + 19 + 12 +3 +12 + 27 +8 +8 + 13 + 24 + 12 + 10 +8 +9 +6 +4 +19 +3 +7 +8 + 12 +8 +3 —6 + 11 —1 —5 +5 + 24 —3 +3 +1 —1 —3 +7 +6 + 13 —0 +5 +2 —1 n.a. + 13 +8 + 18 + 14 + 20 +7 + 19 + 14 +4 +4 +7 n.a. n.a. +11 +15 + 18 +2 n.a. +7 +7 + 12 +6 +6 +3 +9 +7 +6 +3 +8 n.a. n.a. +7 + 18 + 11 +5 +3 +9 +6 + 19 +2 —6 — 10 +0 + 11 —9 +6 +4 —9 + 13 —1 +19 +5 +5 + 17 +9 + 20 +2 + 40 + 10 n.a. +28 + 10 + 25 +2 +21 + 15 +1 +21 +4 +6 +19 + 10 + 13 +11 + 16 + 12 + 27 + 11 n.a. + 10 +9 +11 —2 + 12 + 12 +8 +3 +8 +6 + 15 +9 —1 +7 +0 —1 +1 +2 —0 + 20 + 20 + 10 +7 +15 +15 + 15 + 18 + 13 + 11 + 10 +8 +9 + 12 +19 —2 —0 +0 + 11 +2 +4 +3 +7 +31 +0 +12 —1 +15 + 18 +9 + 13 +10 + 15 +5 + 14 +2 + 11 +8 + 10 + 12 +2 —9 +5 —2 —1 +1 +5 +3 —1 +2 +3 +1 +3 +6 +8 + 18 +6 +6 +4 +6 +5 + 13 + 15 +7 + 13 +9 +6 + 14 +9 +4 +7 +7 +9 + 10 +11 +7 +10 —4 + 13 +11 ♦Not included in total for 32 cities that are part of the national debit series maintained by the Board of Governors. fEstimated. r Revised. n.a. Not available. • 6 • Sixth District Statistics Seasonally Adjusted (All data are indexes, Latest Month (1962) One Month Ago 1957-59 Two Months Ago = 100, unless indicated otherwise.) One Year Ago Latest Month (1962) One Month Ago Two Months Ago One Year Ago SIXTH DISTRICT G EO RGIA INCOME AND SPENDING Personal Income, (Mil. $, Annual Rate) . . June 37,883 37,825r 36,996r 35,605 117 102 109 Farm Cash R e c e ip t s ........................................June 113 115 105 129 C r o p s ...............................................................June 116 104 104 111 Livestock.........................................................June 110 110 115r 118 Department Store S a l e s * / * * ....................... Aug. 115p 106 114 115 Department Store S t o c k s * .............................July 120 Instalment Credit at Banks,* (Mil. $) 130 144 133 New Loans ................................................... July 142 126 125 129r Repayments................................................... July 140 INCOME AND SPENDING Personal Income, (Mil. $, Annual Rate) . . June Farm Cash R e c e ip ts ........................................June Department Store S a l e s * * .............................July 7,007 95 113 7,020r 107 113r 6,852r 99 114r 6,496 97 106 PRODUCTION AND EMPLOYMENT Nonfarm Employment........................................July Manufacturing..............................................July Nonmanufacturing........................................ July Construction..............................................July Farm Employment............................................. July Insured Unemployment, (Percentof Cov. Emp.) July Avg. Weekly Hrs. in Mfg., (Hrs.) . . . . July Manufacturing P a y ro lls .................................. July 107 104 108 114 93 3.4 39.9 119 107 104 108 107r 77 3.3 39.9r 118 106 lt»3 108 109 80 3.0 40.0 118 102 100 103 90 99 5.0 39.7 107 FINANCE AND BANKING Member Bank L o a n s ........................................July Member Bank D e p o s its .................................. July Bank D e b its * * ................................................... July 143 127 136 144 128 134r 138 125 128r 128 117 117r INCOME AND SPENDING Personal Income, (Mil. $, Annual Rate) . . June Farm Cash R e c e ip ts ........................................June Department Store S a l e s * / * * .......................July 5,609 122 107 >,603r 120 100 5,564r 103 105 PRODUCTION AND EMPLOYMENT Nonfarm Employment........................................July Manufacturing..............................................July Nonmanufacturing........................................July Construction..............................................July Farm Employment............................................. July Insured Unemployment, (Percentof Cov. Emp.) July Avg. Weekly Hrs. in Mfg., (Hrs.) . . . . July Manufacturing P a y r o lls .................................. July 97 94 98 74 90 4.6 41.7 107 98 93 99 72 101 4.7 41.2 107 98 94 99 73 91 4.8 41.2 106 FINANCE AND BANKING Member Bank L o a n s*........................................July Member Bank D eposits*.................................. July Bank D e b it s * / * * ..............................................July 131 115 120 132 113 122r 129 112 113r June 2,886 112 June 100 July 2,949r 126 97 2,813r 86 102 2,688 97 95 109 114 107 100 85 4.6 40.2 131 109 114 107 101 81 4.1 39.9r 129 110 113 108 103 84 4.6 40.5 129 105 106 105 99 91 7.1 39.9 113 152 133 130 152 130 133r 151 130 127r 132 117 116r INCOME AND SPENDING Personal Income, (Mil. $, Annual Rate) June 6,013 Farm Cash R e c e ip ts ........................................June June 93 Department Store Sales*/** . . . July 101 6,022r 87 99 5,933r 110 109 PRODUCTION AND EMPLOYMENT Nonfarm Employment........................................July Manufacturing..............................................July Apparel......................................................... July Chemicals................................................... July Fabricated M e t a ls .................................. July Food...............................................................July Lbr., Wood Prod., Furn. & Fix. . . . July P a p e r .........................................................July Primary M e ta ls ........................................July Textiles ................................................... July Transportation Equipment . . . . July Nonmanufacturing........................................July Construction..............................................July Farm Employment............................................. July Insured Unemployment, (Percent of Cov. Emp.) July Avg. Weekly Hrs. in Mfg., (Hrs.) . . . . July Manufacturing P a y r o lls .................................. July Construction Contracts*.................................. June R e sid e n tia l................................................... June All O th e r.........................................................June Electric Power P ro d u ctio n **.......................June Cotton Consumption** .................................. July Petrol. Prod, in Coastal La. and Miss.** . July FINANCE AND BANKING Member Bank Loans* All B a n k s.........................................................July Leading C i t i e s ..............................................Aug. Member Bank Deposits* All B a n k s.........................................................July Leading C i t i e s ..............................................Aug. Bank D e b it s * / * * ............................................. July 106 107 121 101 104 105 98 103 93 97 105 106 95 89 4.4 40.7 121 117 120 114 131 106 146 107 106 119r 101 104 105 98 103 96 96 105 107 94 85 4.1 40.9 122 122 124 120 106 106 118 100 104 103 114 100 105 106 98 103 97 96 103 106 94 85 4.0 41.0 99 103 95 104 95 96 89 104 89 97 5.8 40.4 139 116 158 106 115 99 121 111 122 102 130 109 146 122 136 137 136 136 133 136 123 126 123 120 128 122 120 113 128r 123 113r 122 106 145r 120 130 111 LO U ISIAN A 5,373 111 99 98 93 99 74 98 6.5 40.6 101 118 110 104r M ISSISSIPPI ALABAMA INCOME AND SPENDING Personal Income, (Mil. $, Annual Rate) June June July 5,157 103 107 5,185r 116 102 5,078r 104 110 PRODUCTION AND EMPLOYMENT Nonfarm Employment...................... Manufacturing............................ Nonmanufacturing....................... Construction ............................ Farm Employment....................... Insured Unemployment, (Percent of I Avg. Weekly Hrs. in Mfg., (Hrs.) Manufacturing Payrolls . . . July July July July July July July July 102 99 104 89 103 5.1 39.9 111 102 99 104 90 85 4.9 40.7 116 102 99 104 90 80 4.7 40.4 116 FINANCE AND BANKING Member Bank Loans . . . . Member Bank Deposits . . . Bank D e b its * * ............................ July July July 134 122 123 Department Store Sales** . . 136 121 123r 132 119 120r 4,899 99 107 103 97 105 92 104 5.7 39.7 103 124 110 lllr INCOME AND SPENDING Personal Income, (Mil. $, Annual Rate) . . June 11,211 Farm Cash R e c e ip ts ........................................June 131 142 Department Store S a l e s * * ............................ July FINANCE AND BANKING Member Bank L o a n s ........................................July Member Bank D e p o s its .................................. July Bank D e b its * * ................................................... July PRODUCTION AND EMPLOYMENT Nonfarm Employment............................ July July July July Farm Employment............................................. July Insured Unemployment, (Percentof Cov. Emp.) July Avg. Weekly Hrs. in Mfg., (Hrs.) . . . . July July FINANCE AND BANKING Member Bank Loans* . July July July TENNESSEE FLORIDA PRODUCTION AND EMPLOYMENT Nonfarm Employment........................................July Manufacturing..............................................July Nonmanufacturing........................................July Construction............................................. July Farm Employment............................................. July Insured Unemployment, (Percent of Cov. Emp.) July Avg. Weekly Hrs. in Mfg., (Hrs.) . . . . July Manufacturing P a y r o lls .................................. July INCOME AND SPENDING Personal Income, (Mil. $, Annual Rate) Farm Cash R e c e ip ts ............................. Department Store Sales*/** . . . 114 124 113 94 86 4.0 41.0 148 ll,0 4 6 r 133 140 115 123r 114 95r 84 3.3 41.6 150 10,756r 10,428 115 125 137 125 114 121 113 92 105 3.2 41.4 148 110 117 109 89 93 4.6 41.5 138 PRODUCTION AND EMPLOYMENT Nonfarm Employment........................................July Manufacturing..............................................July Nonmanufacturing........................................July Construction..............................................July Farm Employment............................................. July Insured Unemployment, (Percentof Cov. Emp.) July Avg. Weekly Hrs. in Mfg., (Hrs.) . . . . July Manufacturing P a y ro lls .................................. July 105 108 104 112 105 108 104 113r 121 4.9 40.3r 121r 136 122 129 135 119 131r 84 5.3 40.7 86 105 107 104 117 84 4.8 40.8 120 5,721 96 102 104 104 103 107 99 7.0 39.9 111 FINANCE AND BANKING 132 126 126 131 122 127r *For Sixth District area only. Other totals for entire six states. **Daily average basis. 128 122 125 120 113 112r . July . July . July p Preliminary. 133 119 122r 124 115 123r r Revised. Sources: Personal income estimated by this Bank; nonfarm, mfg. and nonmfg. emp., mfg. payrolls and hours, and unemp., U.S. Dept, of Labor and cooperating state agencies; cotton consumption, U.S. Bureau of Census; construction contracts, F. W. Dodge Corp.; petrol, prod., U.S. Bureau of Mines; elec. power prod., Fed. Power Comm.; farm cash receipts and farm emp., U.S.D.A. Other indexes based on data collected by this Bank. All indexes calculated by this Bank. • 7 • 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 I i i m i | i i i i i | i i i I I | ii i i i | i i i i i | i i i i i | Billion* of Dollars _ Annual R a t* Seas. Adj. - 1 — Personal Income^ N o decisive change in the trend of the District's economy can be ob served from the latest a v a ilab le data. Economic indicators never move sim ultaneously in the sam e direction, and the current period is no exception to that rule; but most recent data show that n early all changes, w hether up or down, w ere sm all. is Mfg. Employment Employment has ceased its rather considerable rise of recent months. Declines in nonmanufacturing employment in July, attributable in considerable degree to an airline strike, more than offset widespread gains in manufacturing. Manufacturing payrolls edged downward in July, reflecting a decline in the average work week, but differed little from the generally high level of the previous five months. ^ Average Weekly Hours* W orked in Mfg. Mfg. Payrolls Cotton consumption, an important m easure of textile activity, dropped back slightly in Ju ly, thus continuing this y ea r's pattern of monthly fluctuations about a high averag e volum e. The latest three- Construction Contracts 3 - mo. moving avg. \S month average of construction contracts, based partly on July data, declined again, but the high volume of contracts previously let continues to sustain employment. Construction employment changed little in July from the im proved level maintained since February. . Electric Power Production Consumer spending has added little to the strength of the economy in recent months. While quite high by historical standards, it showed little change in July from the previous month. Department store sales rose moder ately, but preliminary figures for August indicate a moderate drop, back to the June level. Furniture store sales rose only fractionally in July, sales at household appliance stores remained approximately constant, and bank debits declined slightly from the record high of June. Cotton Consumption Dept. Store Soles More com prehensive figures for June, a v a ila b le only after a longer time lag, reveal that sales of firms operating one to ten retail outlets declined slightly, w hile sales ta x collections increased m oderately to set another new record. Personal income made only a slight gain. Bank Debits Saving is still a popular habit in the District, and consumers seem more reluctant to go into debt now than in recent months. Consumer instalment credit outstanding at commercial banks rose only very slightly in July. New borrowing decreased slightly, while repayments rose markedly. Con sumer savings increased considerably more than usual for the month of July. \S \S As the harvest season began, the farm economy showed signs of in creasing strength. Cash crop production has exceeded last year’s yield by a Member Bank Loans substantial margin, largely because cotton and tobacco harvests have been larger. The peanut crop, however, has suffered a setback from hot, dry weather. Farmers’ shipments of eggs, beef, and pork have been maintained. Prices farmers received for rice and other major crops, meanwhile, declined in July; prices for livestock products, however, rose slightly. )S Member Bank Deposits P E R C E N T OF R EQ U IRED R E S E R V E S 1 Bank loans, after expanding since the middle of last y e a r, have re cently shown little change, although deposits continue to rise. Loans Excess Reserves - V - A ^■ f ^Borrowings v from F. R Bank I i M i I i i li in I mI I960 1961 *Seas. adj. figure; not an index. '■V*'"'45 . -5 i 1962 at all member banks changed little in July. Moreover, weekly reporting member banks registered loan declines in August, in contrast with gains in the same month of most recent years. Spurred by a substantial deposit increase at banks in Florida, total deposits at all member banks rose in July. Note: Data on which statements are based have been adjusted to eliminate seasonal influences.
@FedFRASER