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IDAH O
ALASKA
FEDERAL RESERVE BANK OF SAN F R A N C I S C O
TWEL FTH FEDERAL RESERVE DISTRICT
O fv d L 1 9 6 2
HINGTON
Digitized for CALIFORNIA
FRASER
3 n
D ,h i J ? 53ue
UTAH
Review of Business Conditions
Net Profits of District Banks
Declined in 1961 . . .
.
.
. page 83
ARIZONA
NEVADA
The Search for Certainty in An Uncertain World
This booklet contains a discussion of the role of gold both in our
domestic monetary system and in the international payments system.
A description of the evolution of the gold standard, the pound sterling
standard, and the dollar standard provides a background against which
recent developments affecting our international payments system are
discussed.
The booklet is a reprint of four articles which appeared in this
Bank’s Monthly Review during 1961 and early 1962.
Readings in District Banking
This booklet consists of reprints of three articles which appeared
in this Bank’s M onthly Review during 1961. Each article discusses an
important aspect of banking activity, both in terms of general prin
ciples and with specific reference to the data for Twelfth District banks.
The three topics discussed are: (1) the significance of Treasury bills
as a type of investment for banks and others, with specific reference to
the buying pattern of Twelfth District investors in the weekly bill auc
tions; (2) the role of Federal funds in our national money market and
the important position that Twelfth District banks occupy in the Federal
funds market; and (3) the significant role which Twelfth District banks
play in international banking.
Copies of both of these booklets are available for classroom use and
similar purposes. Requests for copies should be directed to the Federal
Reserve Bank of San Francisco, 400 Sansome Street, San Francisco 20,
California.
tion gains were widespread among consumer
in over-all economic activity during
goods, business equipment, and materials.
the first quarter of 1962 advanced the
total value of goods and services produced in Total retail sales, which had lagged for two
months after November, also rose in Febru
our economy by $7 billion to a new high of
$549 billion on a seasonally adjusted annual
ary and March on a seasonally adjusted basis.
rate basis. Increased spending by consumers
The dollar volume in March (seasonally ad
on services and nondurable goods and by the
justed) exceeded the November peak, ac
Federal Government contributed to the ex
cording to preliminary data.
pansion, as did the growth in business in
Less encouraging has been the behavior
ventories which had the largest quarterly dol
of construction activity. Private housing starts
lar increase in two years. Consumer spending
on a seasonally adjusted basis declined for
on durable goods and on residential construc
four consecutive months through February.
tion declined from the fourth-quarter level.
March, however, brought a sharp rise— 23
Marking the end of the first full year of ex
percent above the February level. Unusually
pansion, the rise left gross national product
adverse weather earlier this year in some
slightly below the expectation of many ana
sections of the nation, including parts of the
lysts of a “$550 billion or better” quarter.
Twelfth District, may have been partly re
If some downward revision of expectations
sponsible for a more than seasonal decline
for the remainder of the year now seems ap
in housing starts at that time. Total expendipropriate, it is worth emphasizing that the
recent shortfall in gross national product was
more in the area of expectations than per
formance. Through the end of 1961 gross
national product in real terms (that is, meas
Trough 2 100
ured in constant prices) advanced at a no
ticeably swifter pace than in comparable
periods of earlier postwar recoveries. The
diminished rate of growth in the first quarter
of this year reduced the over-all rate of ad
vance to approximately that of the corre
sponding periods of prior postwar recoveries,
as indicated on the accompanying chart.
To the extent that weaknesses occurred in
monthly economic indicators, they appear to
have been concentrated early in the first
quarter and some strengthening has occurred
since. Industrial production and personal in
come, both relatively comprehensive indi
N ote: T he data plotted on this chart show the percentage in
cators of month-to-month developments, lost
creases in gross national product, measured in constant prices,
from the lowest quarter of gross national product in each reces
ground in January but advanced in each of
sion through subsequent quarters of recovery.
Source: United States D epartm ent of Commerce and Council of
the following two months. In March, produc
Economic Advisers.
G
a in s
FEDERAL RESERVE BANK OF SAN F R A N C I S C O
tures on new construction, both private and
public, declined rather sharply in February
but rose 1 percent in March. For the quarter
as a whole, expenditures on new construction,
seasonally adjusted, were 3 percent below
the fourth quarter of 1961 and only 3 per
cent above the year-ago level.
Recent changes in unemployment and em
ployment, while favorable, have not shown
as much strength as some of the other indi
cators already mentioned. Both unemploy
ment and the unemployment rate continued
to fall through March, but neither decline
represented very significant improvement.
Figures covering long-term unemployment
(15 weeks or more) and “hard-core” unem
ployment (27 weeks or more) showed rises
from mid-February of 53,000 and 31,000,
respectively, but the increases were less than
seasonal. Perhaps even more disquieting was
the figure showing the civilian labor force in
March at 314,000 under the level of March
1961. This contrasts sharply with the increase
in the labor force which would have been ex
pected on the basis of age distribution and
other population characteristics in a year of
economic expansion.
Pacific Coasf unemployment
up in March
The seasonally adjusted rate of unemploy
ment in the Pacific Coast States rose to 5.8
percent of the civilian labor force in March,
from 5.6 percent in February. In contrast, the
national rate of unemployment in March
edged down to 5.5 percent from 5.6 percent
in the preceding month. The increase in the
Pacific Coast States reflected both a slight rise
in the labor force and a small decline in total
employment, even though nonfarm wage and
salary employment rose fractionally. How
ever, in spite of the March increase, the num
ber of jobless workers in the Pacific Coast
States was still 16 percent below a year ago,
while the total number of employed was about
2.6 percent greater than in the same month
of 1961. According to preliminary data
for these States, the small addition to nonagricultural wage and salary employment in
March reflected increases in every major in
dustry except construction and manufactur
ing, which registered slight declines. The de
cline in construction employment occurred in
Oregon and Washington where unfavorable
weather conditions slowed outdoor activity.
Within the manufacturing sector, divergent
movements were evident; a substantial gain
in electrical equipment and slight gains in
primary and fabricated metals, machinery,
and printing and publishing failed to offset
sizeable declines in food and kindred products
and lumber and wood products and a moder
ate loss in transportation equipment. In the
latter industry, Pacific Coast aircraft employ
ment dropped slightly as the result of con
tinued layoffs in California, concentrated in
the San Diego area, which more than offset
increased employment in Washington.
District employment records
small increase in February
District nonfarm wage and salary employ
ment rose by 15,600, or 0.2 percent, on a
seasonally adjusted basis in February, with
small gains in the manufacturing, trade, fin
ance, services, and government sectors more
than offsetting declines in mining, transpor
tation, and construction. As a result of these
declines, District employment in mining re
mained slightly under the level of the same
month a year ago, and transportation employ
ment was unchanged from February 1961.
Employment in the construction industry,
however, still posted a 2 percent gain on a
year-to-year basis, in spite of the greater than
seasonal decline in February (1 percent)
brought about by severe midwinter weather.
An increase in February of 0.4 percent in Dis
April 1962
MONTHLY REVIEW
trict manufacturing employment was concen
trated in the Pacific Coast States. On a yearto-year basis, District manufacturing employ
ment, which accounts for 25 percent of total
District nonfarm wage and salary employ
ment, recorded a 5.4 percent gain. This was
the largest increase realized by a major in
dustry sector and was primarily responsible
for the 3.7 percent gain in total District non
farm employment during the year.
While District nonfarm employment on a
seasonally adjusted basis recorded a slight
increase in February, the number of District
workers drawing unemployment compensa
tion under regular State programs also in
creased on a seasonally adjusted basis to
286,000 from 280,000 in January. This in
crease interrupted a succession of monthly de
clines dating from July 1961, which was the
peak month for the District. This increase re
flected, almost in its entirety, higher unem
ploym ent in C alifornia stem m ing from
weather-induced layoffs in construction, lay
offs in the food-processing industry, and a
continued decline in aircraft payrolls. An
additional factor was the availability in Cali
fornia of a new quarter’s wage credits for
purposes of unemployment insurance. In
March, the number of District workers draw
ing unemployment compensation registered
a smaller decline than is usual for the month,
so that on a seasonally adjusted basis the
number of such workers rose to 297,000.
Although there were no changes during
February in the classification of the fifteen
major labor market areas in the District by
the Bureau of Employment Security, an im
portant change occurred in March with the
reclassification of Los Angeles-Long Beach
from an “area of substantial unemployment”
(6.0 to 8.9 percent of the labor force) to an
“area of moderate unemployment” (3.0 to
5.9 percent of the labor force).
Retail sales maintain high level
During January, sales of Group I retail
stores1 in the Twelfth District were 21 per
cent above the same month a year ago. The
increase was shared by all types of stores,
although the automotive dealers had the
largest gain. Available data on department
store sales and new car registrations indicate
th at retail activity during F eb ru ary and
March was also at a high level. During Feb
ruary, the index of department store sales in
the Twelfth District reached a record high,
equal to 177 percent of the 1947-49 base
period after seasonal adjustment. The pre
liminary seasonally adjusted index of depart
ment store sales for March remained at the
February level. For the first quarter of the
year, department store sales in the District,
including an adjustment for the different tim
ing of Easter, were about 9 percent above the
year-ago quarter. Some of the increase re
flects operations of newly opened department
stores and expanded operations of existing
stores within the District. It is difficult to
evaluate their actual importance inasmuch as
these new stores would attract sales away
from other stores. However, by excluding
the sales operations of those stores without
comparable year-ago data, the first quarter
of the year still showed an increase of 5 per
cent. For the nation as a whole, department
store sales during the first three months of the
year were 6 percent above the year-ago quar
ter, with the index of sales reaching a record
high after seasonal adjustment during the
month of March.
Automotive sales in the nation were also
at a high level during February and March—
about 25 percent above the same months of
1961. During February, daily average new
car registrations in California reached 2,094,
which was up substantially from the January
“Stores of firms operating 1-10 stores at the time of the
1958 Census of Business.
FEDERAL RESERVE BANK OF SAN F R A N C I S C O
level of 1,930 per selling day though still
running behind the last three months of 1961.
When compared with the early part of 1961,
the selling rate for both January and Febru
ary of this year was significantly higher.
A sharp pickup occurred in March, with daily
sales averaging 2,480 in the first 27 days of
the month. This was the highest rate for any
month since M arch 1960.
District construction down
in February
The value of total construction contracts
awarded in the District during February
amounted to $571 million, representing a
decline of 9 percent below January and a
decline of 1 percent below February a year
ago. About half of the decline from January
reflected a reduction in contracts let for resi
dential construction, and reduced awards for
nonresidential and heavy engineering con
struction accounted for an equal proportion of
the remainder. As compared with February
1961, all of the decline in District awards was
accounted for by heavy engineering contracts
and, specifically, by a sharp reduction (70
percent) in contracts let for utilities. Non
residential construction awards were slightly
above the same month a year ago due to an
increase in the value of contracts let for hos
pital and recreational facilities. An almost
equal increase in the value of contracts let
for apartments and 1- and 2-family houses
contributed to a 21 percent increase in Dis
trict awards for residential construction. In
contrast to developments in the District, total
construction contracts let in the nation dur
ing February recorded a slight increase from
January, while in relation to February of
1961, all major categories of construction
awards recorded substantial gains. However,
the letting of contract awards is subject to
erratic month-to-month changes and not too
much significance should be attached to the
divergent movement of District and national
construction awards in February.
Contract awards are a measure of pro
spective rather than of current construction
activity. As indicated by the number of pri
vate housing starts (after seasonal adjust
m ent), current residential construction activi
ty in both the District and the nation de
clined in February. Severe weather, particu
larly very heavy rains in Southern California,
was an important factor contributing to the
reduced activity in both the District and the
nation.
In conformity with trends in the nation,
District mortgage markets eased somewhat
during February. A primary factor contribut
ing to this development was the continued
vigorous flow of savings into District financial
institutions. The net increase in shares of
District savings and loan associations was
maintained at a high level, topping the growth
realized during the same month a year ago.
For their part, District commercial banks also
recorded substantial gains resulting from
higher interest paid on savings and time de
posits following modification of Regulation
Q. During the first two months of the year,
the increase in the supply of mortgage funds
in the District outpaced the amount of mort
gage lending. According to preliminary in
formation, a continued strong growth in the
supply of mortgage funds occurred in March,
pointing toward keener competition in the
lending of these funds by District financial
institutions. In addition to a reported slight
decline in rates on conventional loans, easing
conditions in District mortgage markets are
reflected in the price for Federally insured
mortgages. Discounts on these mortgages
were slightly smaller in February and ap
parently declined substantially in March.
Lumber production, prices up
Following a moderate increase in January,
Douglas fir production again rose in February
April 1 9 6 2
MONTHLY REVIEW
and in board feet reached a level 8 percent
above output in the corresponding period a
year ago. Largely as the result of reduced
orders by Eastern buyers, new orders de
clined from January to a level below current
production but still were 12 percent above
the level of orders in February 1961. Demand
increased somewhat in March notwithstand
ing the influence of bad weather and delayed
construction activity in consuming areas early
in the month; however, new orders again fell
below production and also were below the
level of new business received in March 1961.
After declining in January, Western pine
production picked up in February and reached
a level 15 percent above the same month a
year ago. New orders also recorded strong
gains, rising 10 percent above January and
39 percent above the level of new business in
February 1961. Orders reportedly were main
tained at a high level in March and contribut
ed to a further strengthening of prices. Al
though prices for green fir dipped slightly in
March, higher prices for dry fir and, in particu
lar, for pine species, boosted Crow’s average
lumber price per thousand board feet to
$75.88 at month-end. This represented an
increase of 81 cents during March and an in
crease of $2.36 since the first of February,
Mixed market demand for
District metals
Fluctuations in weekly steel production in
the District and the rest of the nation during
the months of February and March mirrored
the changing sentiments of steel producers
and consumers concerning the outcome of the
steel industry’s labor contract negotiations.
Both Western and national steel production
advanced in February up to the week ended
February 17 and then declined until the week
ended March 3. Over the four-week period
extending from February 3 to March 3, the
national and District steel production indexes
(1957-59 — 100) had declined 3.5 and 1.7
percent, respectively. The weakening of the
steel market in late February was due to hesi
tation among many customers to order more
steel until the outcome of the negotiations
became more certain.
The breakdown of the contract talks by
March 2 and the influence on the national
index of a 14 point rise in the Cleveland dis
trict contributed to the advance of both in
dexes in the week ended March 10. In the
remaining three weeks of March, the national
and Western indexes moved in opposite di
rections; the national index rose successively,
while the Western index declined. Reflecting
increased confidence th at co n tract talks
would not result in a strike, many steel con
suming firms were reluctant to place heavy
orders during these weeks. While this senti
ment should have resulted in a lull in the
market, the national index continued to rise
through March as mills kept pouring steel at
a fairly high rate to meet heavy shipment
schedules and as seasonal demands increased.
Copper producers and smelters report that
demand for copper held up well in March
and that sales were steady at a “good” level.
March shipments of refined copper probably
exceeded the amounts delivered in February.
Prices for copper in the more sensitive m ar
kets here and in London have remained un
usually steady for the past several months,
so far riding out turmoil in the Congo, politi
cal and labor unrest in Northern Rhodesia,
and the possibility of a strike by Chilean
workers at a major copper producing firm in
that country. Although foreign demand for
copper fell a bit in March, the relative stabili
ty of the metal’s price in London is reported
to have resulted from purchases and sales
by some foreign producers to stabilize the
m arket. C opper for im m ediate delivery
closed Friday, March 30, at the equivalent of
about 29.375 cents a pound, up from 29.34
cents a week earlier.
FEDERAL RESERVE BANK OF SAN F R A N C I S C O
CHANGES IN S E LE C TE D BALANCE SHEET ITEM i OF
W E E K LY R EPO R TIN G M EM BER BANK! IN LEADING CITIES
(dollar amounts in millions)
Twelfth District
From Dec. 27, 1961
From Mar. 29, 1961
to Mar. 28, 1962
to Mar. 28, 1962
Dollars Percent
Dollars Percent
ASSETS:
Total loans and investment*
Loans adjusted and invest
ments!
Loans adjusted^
Commercial and industrial
loans
Real estate loans
Agricultural loans
Loans for purchasing and
carrying securities
Loans to non-bank financial
institutions
Loans to domestic commer
cial banks
Loans to foreign banks
Other loans
U. S. Government securities
Other securities
LIABILITIES:
Demand deposits adjusted
Time deposits
Savings accounts
+ 100
+
— 148
+ 99
__ 0 .57
0.61
+
— 78 _
+ 100 +
+ 55
+
0.38
United States
From Dec. 27, 1961
From Mar. 29, 1961
to Mar. 28, 1962
to Mar. 28, 1962
Dollars Percent
Dollars Percent
+ 2,533
+ 10.67
— 1,216
—
0.99
+ 9,790
+
8.78
+ 2,348
955
+ 10.00
+ 6.20
— 1,518
— 539
—
—
1.25
0.72
+ 9,523
+ 4,392
+
+
8.66
6.31
+
5.32
5.40
+ 23 .94
+
+
+
+
+
+
+
+
+
+
811
893
193
+
1.35
1.83
7.46
+
+
287
285
153
+
+
94
221
52
+
0.29
1.65
4.09
2.52
7.02
+ 17.09
+
43
+
19.55
+
72
+ 37.70
—
347
—
7.13
+ 1,415
+ 4 5 .59
—
47
_
5.3 4
+
89
+ 11.95
—
510
—
8.32
+
592
+ 11.76
+ 24 8 + 120.98
0
0
1.52
+ 49 +
— 460 — 6.42
+ 213 +
8.35
+
+
+
+
+
185
48
54
781
612
+
+
+
+
+
+ 302
+
35
+
81
— 2,033
+ 1,054
+ 20.01
+ 5.33
+ 0.48
— 5.94
+ 8.61
+ 267
+
10
+ 647
+ 2,695
+ 2 ,4 3 6
+ 17.29
+ 1,47
+ 3.97
+ 9.13
+ 2 2 .4 4
— 779
+ 747
+ 423
+ 274 + 2.43
+ 1,948 + 15.94
+ 1,321e + 13.41 e
— 4,1 1 4 — 6.20
+ 3,583 + 8.64
+ 1,539 + 5.12
+ 596
+ 7,557
....
+ 0.97
+ 2 0 .15
n.a.
+
+
6.31
5.57
3.94
69.03
24.87
1.68
13.18
28 .44
e Estim ated,
n.a. N ot available.
1 Inclusive of loans to domestic commercial banks and after deduction of valuation reserves; individual loan items are shown gross.
Sources: Board of Governors of the Federal Reserve System and Federal Reserve Bank of San Francisco.
Petroleum refining operations steady
American Petroleum Institute weekly re
ports indicate that West Coast refining activi
ty was maintained at about 75 percent of
capacity during the first half of March, close
to the average rate during February. Al
though refining operations have been con
sistently above year-ago levels for the last
several months, increased demand has kept
stocks of most major refined products at or
below the earlier levels. During the four
weeks ended March 23, crude oil production
in California was down 4 percent from a year
ago; for the United States as a whole, output
was maintained at the year-ago rate. Nation
ally, output rose in April compared to a year
ago, while it fell in California.
Sharp reduction in prospect for
District crop acreage
Over 2 million acres of District crop land
are scheduled for idleness in 1962 under vari
ous Government programs to remove land
from crop production. Crop acreage in the
District was little affected by the emergency
Feed Grain Program in 1961 because the
crops included in the program— corn and
grain sorghum— are of little importance in
the District. With the addition of barley to the
Feed Grain Program this year, however, Dis
trict farmers have indicated that they intend
to divert 670 thousand acres of farm land
from barley production. Furthermore, par
ticipation in the new Wheat Program for 1962
indicates a wheat acreage diversion in the Dis
trict of about 1 million acres.
April 1962
MONTHLY REVIEW
A reduction in District crop acreage is also
indicated by the March 1 planting intention
reports released by the United States Depart
ment of Agriculture, but it is not nearly so
large a reduction as that indicated by the pros
pective participation in the Wheat and Feed
Grain Programs. The difference may be even
greater when the final reports on participation
in the various programs have been tabulated.
In addition to field crops influenced directly
by farm programs, a 10 percent reduction in
acreage is in prospect for potatoes following
the low prices received for the 1961 crop. In
creased plantings are scheduled for a few
major crops in the District, with the largest
increases indicated for the production of sugar
beets, rice, and hay.
Total loans show quarterly gain,
but business ioans fell
After a relatively heavy loan demand in
December, member banks in the Twelfth Dis
trict started the new year with the usual Jan
uary loan decline as seasonal repayments ex
ceeded new loans by $130 million.1 This loss,
however, was more than offset by a gain in
February of $111 million and a further in
crease of $172 million in March as the normal
demands for credit were augmented by bor
rowing to meet mid-March tax payments.
Thus, District member banks ended the first
quarter of 1962 with a net loan increase of
$ 153 million. This is a slightly larger gain than
in the first quarter of 1960 and contrasts with
a decline in the corresponding period of
1961.2 Country banks contributed one-half
the dollar amount of the quarterly increase in
loans, which meant for them a gain of 2.89
percent in loan volume compared with only
a 0.48 percent increase for the reserve city
banks.
The weekly reporting member banks in the
District had a net reduction of $78 million in
business loans in the first quarter. The amount
'T o ta l Ioans after adjustm ent to exclude Ioans to domestic com
m ercial banks and deduction of valuation reserves.
*After adjustm ent for inclusion of form er nonmember banks in
the series.
of tax borrowing by business over the midMarch tax date was about half that of last
year and was insufficient to offset the large
seasonal repayments in January which re
flected, in part, the unusually high rate of
business borrowing in November and De
cember. For banks which report business
loans classified by industry, there was a net
decline of $68 million in borrowings of non
durable goods manufacturers, principally the
result of a $76 million seasonal reduction in
the bank debt of food, liquor and tobacco
companies. The dominant factors in a $13
million decline in loans to durable goods man
ufacturers were a $25 million decrease in the
category “other durable goods” and a par
tially offsetting increase of $14 million in the
bank debt of m achinery m anufacturers.
Loans to commodity dealers fell seasonally,
by $23 million, in contrast to a $10 million
rise in borrowing by retail trade firms. The
other large reduction was in loans to trans
portation, communications, and other utilities
firms which dropped $21 million. Borrowing
by “other business” (mainly services) regis
tered a net gain of $11 million for the quarter.
Higher interest rates on District
business loans in March
In spite of the lower volume of business
loans, the average rate charged by District
banks on short-term business loans rose to
5.39 percent in the first half of March, accord
ing to the latest quarterly interest rate survey
conducted by this Bank. This was 14 basis
points above the 5.25 percent average rate in
the first half of December 1961. Moreover, it
was the largest quarterly change since Sep
tember 1960 when rates declined sharply as a
result of the drop in the prime rate. The aver
age rate on business loans of over one year
maturity also rose. While loans made at the
current prime rate of AVi percent constituted
28 percent of the total dollar volume of
short-term loans made during the first 15
days in M arch, this proportion was down
FEDERAL RESERVE BANK OF SAN F R A N C I S C O
from one-third of the total in December 1961.
A combination of factors may have brought
about these rate increases. Banks in the Dis
trict shared the general optimistic outlook for
a marked upturn in business activity in the
latter part of the first quarter. Because of their
proportionately larger holdings of time to
total deposits, District banks were particularly
conscious of the need to increase earnings to
offset rising costs resulting from the recent
increase in rates paid on savings and time de
posits. In addition, the seasonal decline in de
mand deposits was particularly heavy in the
first two months of the quarter, placing Dis
trict banks under some reserve pressure dur
ing part of this period.
B illiont of Dollars
Real estate loans support
quarterly loan gain
While business loans declined in the first
quarter, weekly reporting banks increased
their holdings of real estate loans $100 mil
lion, in contrast to reductions in the first
quarter of the last several years. Gains in con
sumer loans, loans to brokers and dealers and
to others for purchasing and carrying secu
rities, and agricultural loans also contributed
to the over-all loan increase in the first
quarter. The gain in agricultural loans, how
ever, was due mainly to bank acquisition of
Commodity Credit Corporation loans. Al
though n onbank financial in stitu tio n s in
creased their bank debt over the March tax
payment period, there was a quarterly net de
cline in borrowings by this group.
Portfolios of United States
Government securities reduced;
other security holdings increase
Both reserve city and country banks in the
D istrict reduced th eir holdings of U nited
S tates G overnm ent securities in the first
quarter. Data for weekly reporting member
banks indicate that the reduction occurred in
Treasury bills and in notes and bonds in the
1-5 year maturity range— all other categories
N ote: D ata are for Tw elfth D istrict weekly reporting member
banks. Tim e deposit data from February 1961 through Sep
tember 1961 have been adjusted to exclude loan funds of a
national retailer temporarily held as time certificates of de
posit. Dem and deposits adjusted are total demand deposits other
than domestic commercial interbank and U nited States Govern
ment, less cash items in process of collection.
showed increases. Part of the reduction in the
interm ediate-term s was a result of bonds
dropping into the within-one-year category,
and some was due to the Treasury refunding
operations during this period. A t the same
time, District banks made net additions to
their holdings of other securities, largely state
and municipals, including housing authority
bonds. This switch, particularly pronounced
at the larger banks, was the result of the desire
to hold higher paying investments as an offset
to increased expenses. For all District mem
ber banks, the net reduction in total invest
ment holdings for the first quarter was about
2.5 percent.
Larger than seasonal decline in
demand deposits adjusted,
while time deposits rose
As previously m entioned, a m ore than
usual seasonal decline in demand deposits
April 1962
MONTHLY REVIEW
'T o ta l dem and deposits excluding deposits of banks and United
States Governm ent deposits and less checks in process of
collection.
the change in Regulation Q last December
and by the sluggish expansion of commercial
bank loans since then. Commercial banks in
search of investment income stepped up their
purchases of the shorter maturities of new
bonds, particularly since February, and pro
vided the main support for absorption of the
unusually large supply of bonds marketed in
the first quarter. Competition for the supply
of new issues put downward pressure on
yields. At the end of March, yields averaged
about V a, percent lower than at the beginning
of the year, according to the Bond Buyer’s
index.
This national picture was reflected in Dis
trict bond sales during this period. District
rates declined slightly less than the compar
able national rates; Staat’s index of California
bonds declined to 3.20 percent at the end of
March from 3.37 percent in early January.
Large bond sales of State and local govern
ments in the District amounted to about $350
million in the first three months of 1962,
compared with $205 million in the same pe
riod last year. January and February calen
dars held the bulk of these new issues. Weekly
reporting m em ber banks in the D istrict
showed a net gain of about $250 million in
their holdings of “other securities” (princi
pally municipals) during the quarter. Most of
the gains occurred after mid-February.
profits of Twelfth District member
banks fell in 1961 from their year-ago
peak, despite a record high in total earnings.
The percentage rise in total expenses from
1960 to 1961 was almost double that of gross
earnings, and consequently net current earn
ings were nearly 5 percent below the 1960
level. The major factor contributing to the in
crease in expenses was a rise of approximately
20 percent in interest paid on time deposits.
Savings deposits, which tend to increase dur
ing the first stages of recovery, continued to
expand well into the cyclical upswing as many
District banks initiated the practice of paying
interest on savings accounts on a daily basis in
order to attract additional funds. Although
total earnings on loans of District banks were
only 2 percent larger than in 1960, earnings
adjusted,1 over 6 percent, placed member
banks in the District in a relatively tight re
serve position during part of the first quarter.
Both in January and February, District banks
were on balance net purchasers of Federal
funds and not until March, when the decline
in demand deposits was reversed, were they
net sellers. In addition to causing borrowing
through the purchase of Federal funds, the
deposit decline contributed to the banks’ re
ductions of security holdings. In contrast to
demand deposits, both savings and time de
posits rose sharply th ro u g h o u t the first
quarter, including a contraseasonal gain in
January. The sizable 5.4 percent increase in
total savings and time deposits was due in
large part to the payment of higher interest
rates permitted on such deposits under revised
R egulation Q. R eserve city banks had a
slightly higher percentage gain in total savings
and time deposits than the country banks, but
both groups were able to attract new savings.
Municipal bond market strengthens
The m arket for m unicipal bonds was
stronger during the first quarter of 1962 than
in preceding months. Demand for tax-exempt
investments was given a special stimulus by
et
N
FEDERAL RESERVE BANK OF SAN F R A N C I S C O
(millions of dollars)
1959
1960r
1961p
9 3 8 ,6
1 ,0 7 9 .3
1 ,1 2 2 .9
196.1
6 3 .4
10 6 .4
3 9 .8
5 5 .9
1 8 1 ,7
6 1 ,6
11 8 .8
4 3 .6
5 5 .9
2 2 4 .2
7 1 ,0
12 6 .6
50.1
6 2 .6
1 ,4 0 0 .2
1 ,5 4 0 .9
1 ,6 5 7 .4
369.1
3 2 3 .9
2 4 9 .7
4 1 1 .7
3 3 1 .9
2 8 9 .5
4 3 9 .5
4 0 6 .3
3 2 4 .3
9 4 2 .7
1 ,0 3 3.1
1,170.1
4 5 7 .5
5 0 7 .8
4 8 7 .3
Earnings on loans
Interest and dividends on
U. S. Governm ent securities
Other securities
Service charges on deposit accounts
Trust Department earnings
Other e a rn in g s1
Total e a rn in gs1
Salaries and w a g e s2
Interest on lim e deposits
Other expenses
Total expenses
Net current earnings
Net recoveries and profits {— losses)®
On securities
O n loans
Others
—
—
—
81.1
3 8 .4
3.6
— 4 .7
— 3 9 ,7
— 9 .4
+ 2 8 .0
— 58.1
— 5.5
Total net recoveries an d profits (— losses)
— 123.1
— 53 .8
— 3 5 .6
3 3 4 .4
1 3 8 .6
19 5 .8
1 1 0 .4
8 5 .4
4 5 4 .0
2 0 4 .6
2 4 9 .4
119.2
1 3 0.2
4 5 1 .7
2 0 7 .4
2 4 4 .3
130 .2
114.1
Net profits before income taxes
Taxes on net income
Net profits after taxes
Cash dividends declared
Undistributed profits
r Revised.
^Preliminary
1 Includes rental income.
5 Includes wages and salaries of building personnel.
3 Including transfers to (— ) and from (-}-) valuation reserves.
N ote: T he volume of assets and of earnings and expenses of Tw elfth D istrict member
mergers of nonmember banks with member banks. T he figures shown in this table are
year, w ithout adjustm ent for the effects of these mergers. For analytical purposes, the
estimates which attem pt to adjust the data for 1960 and 1961 to a roughly comparable
are concerned.
from interest and dividends on securities rose
almost 20 percent in 1961. This is in sharp
contrast to the experience of District banks in
1960 when earnings from securities declined
15 percent from the year-ago figure. The gen
eral condition of monetary ease that prevailed
throughout 1961 permitted Twelfth District
banks to rebuild their liquidity positions from
the low level reached at the peak of the busi
ness cycle in the spring of 1960.
The volume of assets and of earnings and
expenses of Twelfth District member banks
was affected more than usual in 1961 by
mergers of nonmember banks with member
banks. For analytical purposes, the percent
banks was affected more than usual in 1961 by
data for member banks only in each respective
percent changes cited in the text are based on
basis so far as the effects of the 1961 mergers
age changes cited in the text are based on
estimates which attempt to adjust the data for
1960 and 1961 to a roughly comparable basis
so far as the effects of the 1961 mergers are
concerned. For this reason, these percentage
changes differ from the changes that could be
calculated from the dollar amounts shown in
the tables, since the latter are the actual data
for member banks in each of the two years
with no estimates introduced to place the two
years on a more comparable basis.
Lagging demand limits rise
in loan earnings
The small percentage increase in earnings
from loans realized by District banks in 1961
April 1962
MONTHLY REVIEW
differs considerably from the experience in
1960 when the dollar rise in returns on loans
accounted for almost the entire gain in total
earnings. Loan dem and lagged throughout
the first six months of 1961, a typical pattern
for the recession trough and the first phase of
recovery in a business cycle. However, owing
to the mildness of the recession, banks in both
the Twelfth District and the nation did not
experience the sharp decline in business bor
rowing characteristic of previous periods of
cyclical decline. This behavior partly ac
counts for the failure of the prime rate on
short-term business loans to fall below the
AVz percent level established in August 1960.
Business loans, which constitute about onethird of the total loan volume of member
banks in the District, rose in the first half of
1960 and then remained relatively stable un
til the fourth quarter of 1961. Nearly all the
6 percent rise in commercial and industrial
loans during 1961 occurred during the last
three months of the year.
Real estate loans, which also make up
about one-third of the loan portfolios of Dis
trict m em ber banks, picked up gradually
throughout 1961 and had risen 4 percent by
the end of the year, reflecting an increase in
both residential and nonresidential construc
tion. This compares with a net decline of 2
percent in such loans during 1960.
During the first few months of 1961, con
sumers chose to increase their liquidity, as is
evidenced by the increase in personal savings,
and made repayments on their instalment
loans at District banks at a faster pace than
they borrowed. However, loans to finance
purchase of autom obiles, which comprise
about 40 percent of loans to individuals by
District banks, increased about 3 percent in
the last quarter of 1961, following the unveil
ing of the new models in October. Other con
sumer loans outstanding also showed moder
ate gains during the latter part of the year,
experiencing a somewhat more than custom
TWELFTH DISTRICT, 1960 and 19B1
(millions of dollars)
Loans1 and investments
Dec. 31,
1960
Dee. 31,
1961?
2 6 ,3 61
2 9 ,4 3 0
1 7 ,1 02
1 8 ,3 48
Comm ercial and industrial
loans
Agricultural loans
Real estate loans
Loans to in d ivid u als
5,8 6 8
772
5 ,8 8 6
3 ,3 6 8
6 ,3 3 0
902
6 ,2 8 7
3 ,5 2 6
U. S. Governm ent o b liga tio n s2
6 ,8 6 4
8,2 0 2
69 3
1,2 6 6
271
1,92 2
3 ,9 7 8
308
3,1 2 5
3,5 0 3
2 ,3 9 5
2 ,8 8 0
Total assets
3 3 ,0 8 6
37,101
Demand deposits
Time deposits
Total deposits
1 6 ,8 0 8
1 3 ,1 6 3
29,9 71
1 8,4 82
15,211
3 3 ,6 9 3
2 ,2 0 4
2 ,5 2 2
Loans and discounts, net1
Treasury bills
Treasury certificates of in
debtedness
Treasury notes
U. S. Bonds2
Other securities
C ap ital accounts
p Preliminary.
1 Total loans m inus valuation reserves. Those selected loan items
which follow are reported gross.
5 Includes obligations guaranteed by the U nited States Govern
ment.
N ote: T he volume of assets and of earnings and expenses of
Twelfth District member banks was affected more than usual in
1961 by mergers of nonmember banks with member banks. The
figures shown in this table are data for member banks only in
each respective year, w ithout adjustm ent for the effects of these
mergers. For analytical purposes, the percent changes cited in
the text are based on estim ates which attem pt to adjust the data
for I960 and 1961 to a roughly comparable basis so far as the
eSects of the 1961 mergers are concerned.
ary seasonal gain as a consequence of a rec
ord volume of Christmas buying.
Substantial rise in earnings
on securities
In sharp contrast to the decline in earnings
on both United States Government and other
securities sustained by Twelfth District mem
ber banks in 1960, returns on securities in
1961 comprised approximately 50 percent of
the dollar increase in total earnings. The av
erage rate of return of 2.96 percent on United
States Government securities in 1961 was
higher than the 2.89 percent average rate of
the previous year, despite the fact that rela
tively high yields on securities prevailed dur
ing the first few months of 1960. However,
FEDERAL RESERVE BANK OF SAN F R A N C I S C O
early in 1960 loan demand was strong, and
banks had little inclination to add to their
securities holdings. As loan demand slack
ened after midyear, banks purchased securi
ties at higher prices than had prevailed earlier.
From mid-1960 through most of 1961, in
terest rates on short-term Government secu
rities remained relatively stable with yields
above 2 percent. This stability reflected the
efforts of both the Federal Reserve System
and the Treasury to discourage outflows of
liquid funds seeking higher returns abroad
and to foster conditions of ease in the domes
tic money market. Banks found it advanta
geous to invest more heavily in the shorter
term bills and certificates in order to remain
liquid in expectation of rising needs for loan
able funds. Purchases of long-term Govern
ment securities fell off gradually during the
year as member banks elected instead to
supplement their investment portfolios with
higher yielding municipal and corporate bond
issues. Such purchases occurred in substan
tially increased volume in December after
banks had decided to increase the rates paid
on time and savings deposits, effective Janu
ary 1, 1962.
MILLIONS O F DOLLARS
0
200
----------- 1-------
400
600
1000
1200
1400
—I—
—I—
—I—
800
From
Securities
................
—
1600
Alt
O th e r
SO U RCES OF
E A R N IN G S
A 1 B
______ 1______
U SE5 O F
E A R N IN G S
1961
W a g e s and
S a la rie s
O th e r O p e ra t- I
in g Expen ses ||||
H lf iy L s
Incom e
Ta x e s
Net
.Losses'
1960
I
N et Profits
A fter Ta x e s
SO U RCES OF
E A R N IN G S
------------------------
—
1* ”
"
If
>/
1
1
1
A
B
U SES O F
E A R N IN G S
_
..................................
SO U RCES OF
E A R N IN G S
1959
.
l i f t
p
w
............................................
_
1 -------
i
■
.* v
-
V"-'
A
1 B
R
U SES O F
E A R N IN G S
A— C ash dividends declared.
B— Undistributed profits.
1N et losses on securities and loans including transfers to and from valuation reserves.
N ote: Owing to changes in the "R eport of Earnings and Dividends” form subm itted by member banks in 1961, some adjustm ents
have been necessary to provide classifications comparable to those of previous years. The 1961 wage and salary figures for this chart
have been adjusted to include wages and salaries of building personnel; in addition, rental income is included in the “ail other” earn
ings figures.
Source: Federal Reserve Bank of San Francisco.
April 1962
MONTHLY REVIEW
Earnings from service charges on deposit
accounts at Twelfth District member banks
grew approximately 5 percent during 1961,
chiefly attributable to an 8 percent gain in
demand deposits during the year. However,
such charges still made up the same percent
age of total earnings as they had in 1960. In
addition, trust department earnings rose both
in dollar volume and as a percentage of total
earnings.
Large increase in interest
payments on time deposits
A larger relative increase in expenses than
in earnings resulted in a decline in net oper
ating earnings of District member banks dur
ing 1961. Confronted with keen competition
from savings and loan associations, which pay
higher rates of return on shares, most banks
initiated the policy of paying interest on sav
ings deposits on a daily basis during the sec
ond quarter of the year. This arrangement,
coupled with a continued high level of per
sonal saving, accounted for the 13 percent
growth in time deposits at District member
banks during 1961. Not only did the banks
pay an effective rate of interest closer to the
3 percent ceiling, but they also incurred larger
costs in their bookkeeping operations. The re
sult was that the dollar increase in interest
paid to depositors absorbed almost threefourths of the net dollar gain in total earn
ings. This was decidedly different from the
experience in 1960, when interest paid on
time deposits showed the smallest rise of the
expense categories. During the first three
months of that year, District banks lost a siz
able amount of time deposits as individuals
chose to invest instead in United States Gov
ernment securities and savings and loan insti
tutions which offered higher rates of return.
Although time deposits did rise during the
following nine months, the rate of increase
was not nearly so great as that of 1961.
Total wage and salary payments to em
ployees, the largest single expense item of
(percent ratios)
I960'
Return on loans
6 .4
Return on U. S.
Governm ent securities 2 .9
Current earnings to
capital accounts
24.1
Net profits after taxes
to capital accounts H . 9
increase
or
1961
6.3
decrease
3.0
+ 0.1
2 0 .6
— 3.5
10.3
— 1.6
— 0.1
■■Revised.
N ote: Capital accounts, loans, and Government securities items
on which ratios are based are averages of Call Report data as of
December 31, 1959, March 15, June 15, October 3, and Decem
ber 31, 1960; and December 31, 1960, April 15, June 30, Sep
tember 27, and December 31, 1961.
D istrict mem ber banks, rose substantially
during the year, despite the increasing use of
automation in routine operations. This was
due, in part, to opening of new branch offices
by the larger banks and to salary and wage
increases during the year. Other expenses of
District banks, which include costs of building
and equipment maintenance, interest on bor
rowed money, and benefits to employees, also
rose during 1961.
Sale of securities added
to bank profits
For the first time since 1958, banks real
ized net recoveries and profits on securities.
Stable interest rates and a sustained market
demand for securities enabled banks to obtain
profits on issues which had been previously
purchased at lower prices. Many of the larger
banks took advantage of the relatively high
market price of bonds at the beginning of
1961 to switch to short-term securities at a
profit with little loss in earnings.
Offsetting the gain in profits from securi
ties were net losses on loan transactions, in
cluding transfers to valuation reserves. These
losses, coupled with lower net current earn
ings, left District member banks with net
profits before taxes at a level 2 percent below
that of 1960. Taxes on 1961 net income of
the 13 largest banks in the D istrict were
nearly the same as the previous year’s despite
FEDERAL RESERVE BANK OF SA N F R A N C I S C O
lower net current earnings, since these banks
realized substantial capital gains on securi
ties. However, the smaller banks as a group
incurred a 6 percent increase in taxes, with
the result that they had a 5 percent decline in
profits after taxes compared with the 3 per
cent decrease experienced by the 13 largest
banks in the District.
Rate of return on capital
declined in 1961
The ratio of net profits after taxes to capi
tal accounts declined from 11.9 percent in
1960 to 10.3 percent in 1961.1 Although net
profits after taxes fell about 4 percent from
the previous record year, Twelfth District
members banks, nevertheless, elected to pay
approximately 8 percent more in dividends
to their stockholders than in 1960. However,
due entirely to the increase in capital accounts
during the year, the ratio of cash dividends to
capital declined from 5.63 percent in 1960 to
5.51 percent in 1961. While in the previous
year banks plowed back 52 percent of their
net profits, only 47 percent was retained in
1961.
Net profits of all member banks
in nation rose in 1961
Total earnings of all member banks in the
United States in 1961 were $286 million
larger than in 1960, according to preliminary
estimates. This was a 3 percent increase com
1These ratios are based on member bank data for each of the
two years and do not reflect any estimates introduced to adjust
for the effects of mergers in 1961.
88
pared with a 5 percent rise in Twelfth District
member bank gross revenue. The average rate
charged on loans by member banks declined
more during 1961 in the nation than in the
Twelfth District. However, the volume of
loans outstanding expanded more in the
nation than in the District, with the result
that both all member and Twelfth District
banks realized about the same percentage
gain in returns from loans.
The 8 percent rise in earnings from United
States Government securities realized by all
member banks was less than half as large as
the 20 percent gain of Twelfth District mem
ber banks. This reflects principally the efforts
of District banks to rebuild their investment
portfolios which had been reduced substan
tially more in 1960 than had those of other
member banks.
In 1961 the rise in expenditures of Twelfth
District member banks was higher than the
7.4 percent increase of all member banks.
Even though net current earnings of all mem
ber banks in 1961 were 4 percent lower than
in 1960, net profits after taxes were 1.4 per
cent higher, due to smaller net losses on non
operating transactions than in 1960. Although
Twelfth District banks had a decline in net
profits during 1961, the ratio of net income
to average total capital accounts remained
higher for the District, 10.3 percent versus
9.5 percent for all member banks. Moreover,
the percentage increase in dividends paid by
District banks in 1961 was nearly the same as
the 7.8 percent rise for the nation as a whole.
FEDERAL RESERVE BANK OF SAN F R A N C ISC O
.pril 1962
BANKING AND CREDIT STATISTICS AND BUSINESS INDEXES— TWELFTH DISTRICT1
( I n d e x e s : 1 947-1949= r 100. D o lla r a m o u n ts in m illio n s o f d o lla r s )
Bank rates
Condition items of all member banks5’ 1
Bank debits
index
31 cities1’ 6
Demand
deposits
adjusted1
Total
time
deposits
405
720
1,450
6,619
6,639
7,942
7,239
6,452
6,619
8,003
6,673
6.964
8,278
1,231
95 1
1,983
10,520
10,515
11,196
11,864
12,169
11,870
12,729
13,375
13,060
14,163
1,790
1,609
2,267
7,502
7,997
8,699
9,120
9,424
10,679
12,077
12, 452
13,034
15,116
42
18
30
140
150
153
173
190
201
209
237
253
270
17,517
17,637
17,632
17,578
17,504
17,779
18.028
17,901
18,212
18,499
6,916
7,436
7,393
7,.)71
7,935
7,863
7,955
8,190
8,182
8,278
12,860
13,222
12,865
12,935
13,206
13,212
13,317
13,901
13,944
14,163
13,754
13,999
14,289
1 1,371
14,492
14,656
11,786
14,867
14,874
15,116
273
266
265
268
267
262
277
291
265
293
18,646
18,622
18,906
8,082
7,820
7,776
13,671
13,163
13,235
15,448
15,647
15.939
291
289
Year
and
Month
Loans
and
discounts
1929
1933
1939
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
2,239
1,486
1,967
8,839
9,220
9,418
11,124
12,613
13,178
13,812
16,537
17,139
18.499
1961
M arch
April
M ay
June
Ju ly
A ugust
Septem ber
( )ctober
N ovem ber
D ecem ber
1962
Ja n u a ry
F ebruary
M arch
U.S.
Gov’t
securities
short-term
business
loans6’ 7
Total
nonagricultural
employ
ment
3.95
4.14
4.09
4.10
4.50
4.97
4.88
5.36
5.62
5.46
"66
118
121
121
127
131
139
138
146
150
152
57
130
137
134
1 14
15 I
161
153
165
16.'.
163
150
150
151
152
152
152
153
153
154
154
161
If,0
162
163
162
164
165
166
167
167
155
156
156/i
169
169
169;>
5.48
5]5(j
5.45
5.42
Industrial production (physical volume)5
Year
and
month
1929
1933
1939
1951
1952
1953
1954
1955
1956
1957
1958
1959
1960
1961
Petroleum7
Lumber
95
40
71
113
115
116
115
122
120
106
107
I lf,
110
109
1961
F e b ru ary
M a rc h
A p ril
M ay
J lin e
.1u l y
A ugust
S e p te m b e r
O c to b e r
N ovem ber
D ecem ber
1962
Jan u ary
F e b ru ary
I
lO O r
103
114
111
111
110
111
111
110
113
106
105
Crude
Refined
Cement
55
27
56
128
124
131
133
145
156
149
158
174
161
169
'24
146
139
158
128
154
163
172
142
138
154
171
91
92
92
92
91
91
91
92
92
92
92
134
131
135
143
143
113
140
1 12
144
141
176
178
168
169
188
157
160
163
171
182
152
152
162
172
191
187
183
180
174
181
167
167
139
165
110
15 3
184
187
90
92
144
Dep't
store
sates
lvalue'5
Retail
food
prices
102
52
7/
100
100
96
101
104
96
89
94
88
87
30
IS
31
120
122
122
132
141
140
143
157
156
175
61
42
17
115
113
113
112
111
118
123
123
125
127
83
81
85
86
84
87
99
100
92
160
161
153
162
167
157
170
1C,
165
175
127
127
127
126
126
125
126
127
126
127
100
99
97
160r
17 7 r
177
127
128
Ss
Waterborne Foreign Trade Index7*
Exports
7, 8
10
Imports
Total
Dry Cargo
Tanker
Total
Dry Cargo
103
17
80
116
115
113
103
120
131
130
116
99
129
136
29
26
40
136
145
162
172
192
209
22 4
229
252
271
190
no
163
186
171
141
133
166
201
231
176
188
241
150
217
128
7
107
194
201
138
1 11
178
261
308
2 12
223
305
2 43
175
130
145
123
149
117
123
123
138
149
124
72
95
162
204
314
268
314
459
582
56 t
686
80S
97
140
14 1
163
166
187
201
216
221
263
269
57
733
1,836
4,239
2,912
3,611
7,180
10,109
9,504
11,699
14,209
134
137
133
143
143
12 t
107
276
285
283
285
289
293
300
29.',
310
305
2 18
26 1
261
265
221
27 l r
2 17
217
209
256
362
363
331
331
290
95
124
163
171
128
Mi-jr'
138
140r
233
252
286
292
289,297
277r
277
307
264
11,985
19,268
13,139
15,856
13,223r
20,025
1 l,586r
15,542
Copper1
78
50
63
112
116
122
119
121
129
132
124
130
13 4
140
Carloadings
(number,5
Electric
power
Steel1
87
52
67
106
107
109
106
106
105
101
94
92
91
92
Total
mf’g
employ
ment
138
149
147
145
322 r
317
310
331
76
67
148
666
952
7.">9
865
767 r
1,02 Or
S0 5 r
841 r
S72
756
Tanker
15,613
13,573
143
A d ju ste d fo r se aso n al v a ria tio n , e x c e p t w here in d ic a te d . E x c e p t for b a n k in g a n d c re d it a n d d e p a r tm e n t s to re s ta tis tic s , all in d ex es a r e b ased u p o n
la t a fro m o u tsid e so u rces, a s follow s: lu m b e r, N a tio n a l L u m b e r M a n u fa c tu r e r s ’ A sso ciatio n , W est C o a st L u m b e rm a n 's A sso c ia tio n , a n d W e s te rn
?ine A sso ciatio n ; p e tro le u m , cem en t, a n d c o p p er, U.S. B u re a u of M ines; ste el, U.S. D e p a r tm e n t of C o m m e rc e a n d A m e ric a n Iro n a n d S teel I n s t i t u t e ;
le c tric p o w er, F e d e ra l P o w er C o m m issio n ; n o n a g ric u ltu ra l a n d m a n u f a c tu rin g e m p lo y m e n t, U .S. B u re a u of L ab o r S ta tis tic s a n d c o o p e ra tin g s t a te
„gencies; re ta il food prices, U.S. B u re a u of L ab o r S ta tis tic s ; o arlo ad in g s, v a rio u s ra ilro a d s a n d ra ilro a d a sso c ia tio n s ; a n d foreign tr a d e , U .S. D e p a r tm e n t
»f C o m m erce.
2 A n n u al ligures are a s of en d of y e a r, m o n th ly figures as of la s t W e d n e sd a y in m o n th .
3 D e m a n d d e p o sits, e x c lu d in g
n te r b a n k a n d U.S. G o v e rn m e n t d ep o sits, less c ash ite m s in process of collection. M o n th ly d a ta p a r tly e s tim a te d .
4 D e b its to to ta l d e p o s its
x cep t in te r b a n k p rio r to 11)12. D e b its to d e m a n d d e p o s its ex c e p t U .S . G o v e rn m e n t a n d in te r b a n k d e p o s its fro m 1942.
D a ily a v e r a g e .
A v erag e r a te s on lo an s m ad e in five m a jo r cities, w eig h te d b y lo an size c a te g o ry .
7 N o t a d ju s te d for se aso n al v a ria tio n .
s L os A n g eles,
San F ra n cisco , a n d S e a ttle in dexes co m b in ed .
9 C o m m ercial carg o only, in p h y sical volum e, for th e P aciiic C o a s t c u s to m s d is tr ic ts p lu s A la sk a
.nd H a w a ii; s ta r tin g w ith Ju ly 195U, “ sp ecial c a te g o ry " e x p o rts a re ex clu d ed b ecau se of s e c u rity reaso n s.
10 A lask a a n d H a w a ii a re in c lu d e d
:i in d ex es b eg in n in g in 1950.
p — P re lim in a ry .
r — R ev ised .
88A
@FedFRASER