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IDAHO ALA SKA VSHINGTON C A LIFO RN IA 7Uwsim1)sl?l 1962 H ue UTAH Review of Business Conditions ARIZO N A NEVADA Review of Business Conditions overall pace of economic activity quick in November and may lend further support ened somewhat in October after several to steel production. Inventories of durable months of comparative lull. The output of goods manufacturers increased slightly during goods and services in the economy was at an October but have been relatively low in rela annual rate of $555.3 billion during the third tion to sales; the latter declined somewhat in October. quarter, according to Department of Com merce estimates. The increase from the pre Construction put in place in October was vious quarter was only $3.3 billion compared estimated at a seasonally adjusted annual rate with a disappointing $7.0 billion increase for of $63.1 billion, up slightly from September. the second quarter. The rise during the third However, preliminary estimates indicate a sig nificant decline in November. On the surface, quarter resulted in part from a $ 2.2 billion the housing start data for October appear to rise in government purchases of goods and herald an upswing in residential construction services. Consumer expenditures rose at a activity with housing starts rising 17 percent reduced rate while business outlays and ex from the September rate. Actually, housing ports declined. After such a lackluster per starts in October returned to about the same formance in the third quarter, indications of level as in August. The low level of starts in more vigor in the economy are particularly September was attributed in part to working welcome and have prompted more optimistic day differences, which blunts the significance forecasts for economic activity in 1963. of the October rise. The prospects for a Industrial production remained unchanged in October for the third consecutive month as strengthening in residential housing construc the Federal Reserve index stayed at a season tion, however, is reinforced by heavier appli ally adjusted level of 120 (1957-59 = 100). cations to the Federal Housing Administra Gains in output were confined to business tion for mortgage insurance. These applica equipment industries while declines occurred tions reached an annual rate of 212,000 in in the production of materials and some con October, the highest rate since July. Interest sumer durable goods, particularly television rates on conventional mortgages remained un sets and furniture. Prospects for future expan changed in October but had been trending sion of industrial output were strengthened by downward in previous months according to the Commerce Department announcement the FH A survey. that new orders received by durable goods Nonfarm employment rose to 63.4 million manufacturers rose 3 percent in October to a in October, a new record for the month. The record level following an indecisive increase increase from September, however, was about of 1 percent in September. The Commerce on a par with the usual seasonal movement. Department called the October increase Unemployment declined by 218,000 between “widely based” with special mention of the September and October, reducing the unem rise in new orders received by the iron and ployment rate to 5.5 percent. Moreover, the steel, nonferrous metals, and machinery in hard core of unemployment — persons seek dustries. The increase in new orders received ing employment for six months or longer — by the steel industry was undoubtedly sup declined from 477,000 to 447,000. Total un ported by the large volume of new car sales employment in November rose 507,000, which is more than the typical increase be and a decline in steel inventories held by auto tween the two months, and the unemployment makers. Car sales continued at a rapid pace T 210 h e November 1962 MONTHLY REVIEW rate returned to its August-September level of 5.8 percent. Personal income rose $2.1 billion in Octo ber to a seasonally adjusted annual rate of $445.6 billion. This is the largest month-tomonth increase since April and was fairly wide spread except among factory workers. Al though factory payrolls remained unchanged, this represented some strengthening following a two-month decline. About one-third of the October increase in personal income resulted from a rise in transfer payments as the Gov ernment began payment of the increased monthly rates of compensation to veterans for service-connected disabilities. The October disbursement was unusually large because it included payment of the increase for the months of August and September as well as for October. Consumer anticipation of higher incomes over the next year was more prevalent in Oc tober than in July according to results of the Quarterly Survey of Consumer Buying Inten sions conducted by the Bureau of the Census for the Board of Governors of the Federal Re serve System. A more general expectation of higher income strengthened consumer plans regarding purchases of household durable goods and new automobiles. However, slight ly fewer consumers indicated plans to pur chase homes in the October than in the July survey. Retail sales moved to a record high in Oc tober, reaching a total of $20.1 billion after seasonal adjustment. This represents a 0.8 percent increase from September and reflects a 5.9 percent rise in the sale of durable goods as the sales of new cars rose to a record level during the month. Gains in the durable goods sector were partially offset by an easing in de partment store sales which contributed in part to the 1.4 percent decline in purchases of non durable goods. District em ploym ent g a in e d in October; insured unem ploym ent unchanged Nonagricultural wage and salary employ ment1 in the Twelfth District2 increased again in October by 0.3 percent, after rising 0.4 per cent in September. Employment rose in all seven states during October, with the largest percentage gains occurring in Oregon and Utah; California had only a 0.2 percent rise, off from the average rate of increase per month of 0.4 percent during 1962. All indus try divisions in the District increased in Octo ber, except mining; however, mining employ ment in October was slightly higher than the average for the 10 months of 1962. The great est percentage increases were recorded in con tract construction and finance and govern ment. Wholesale and retail trade employment, which was unchanged from August to Septem ber, added 5,100 workers in October, an in crease of 0.3 percent. Manufacturing employ ment rose moderately in October but was off the pace set in August and September when manufacturing achieved the greatest percent age gains thus far in 1962, 0.8 percent in both months. Since January of this year, District nonag ricultural employment has expanded by 2.7 percent, or 197,600 employees. Of this in crease, 55,900 workers, or 28 percent, were added to manufacturing payrolls; this repre sented a 3 percent rise from January to Octo ber. The two industries which registered the greatest percentage gains (3.5 percent each) were finance and services. The latter industry, trade, and government have expanded their payrolls by almost 40,000 workers each. Manufacturing, services, and finance also showed sizable increases over October 1961. Although contract construction employment had risen by 4 percent over the year-ago fig ure, the rate of expansion since January was 1 A ll employment data are seasonally adjusted except where noted. 2 District employment data exclude Alaska and H aw aii except for insured unemployment data. 211 FEDERAL RESERVE BANK W o rkw eek of Twelfth District m anufacturing w o rkers up sh arp ly in September J M M J S 1961 N J M M J S 1962 N Note: A ll data are seasonally adjusted. Source: State departments of employment* only 1.4 percent. The sluggishness of this in dustry was further reflected in the relatively small increase (5,400 workers or 1.2 percent) in average employment for the last three months compared with the prestrike months of January through April. Average weekly insured unemployment in the District was virtually unchanged from September to October. After jumping to a peak in June (primarily because of the Cali fornia construction strike), District insured unemployment has edged downward in the last four months. This is in contrast to insured unemployment in the nation which has been rising steadily since May, with the exception of a minor decrease in September. Pacific Coast unem ploym ent fell in October; m anufacturing jobs rose 2 Total unemployment on the Pacific Coast fell by 2.2 percent in October, after rising by 1.7 percent in September. Unemployment was 11 percent less than in October 1961, and the rate of unemployment was 5.7 percent this October as compared with 5.8 percent in September and 6.5 percent last year. Civilian OF SAN FRANCISCO employment was down somewhat because a slight increase in nonfarm employment did not offset a sizable decline in the typically er ratic agricultural sector. Manufacturing jobs on the West Coast rose by 0.3 percent in October, with gains in both durable and nondurable goods. In the non durable goods sector, the volatile canning and preserving industry scored the greatest monthto-month increase as it had in September. This industry’s employment was higher than the average for the first 10 months of 1962 by approximately 7 percent in September and 10 percent in October. All other nondurable goods industries showed moderate gains. In October, the largest gain in the durable goods sector occurred in transportation equip ment. However, within this industry, aircraft employment fell slightly during the month. The fourth consecutive monthly increase in California aircraft employment failed to offset a 2.3 percent decrease in Washington. After reaching an all-time high in August, aircraft employment in Washington fell by 1,200 workers in September and 1,700 in October. However, the October employment level was 8,300 more than October 1961. In Califor nia, the year-to-year gain was 2,200 workers. Although most of the durable goods indus tries had gains over last October ranging from 3 percent in fabricated metals to 14.5 per cent in electrical equipment, two industries, November 1962 MONTHLY REVIEW primary metals and lumber and wood prod ucts, showed declines from year-ago levels. Primary metals employment, after falling be low last year’s levels in September, fell fur ther in October, down 3.7 percent. Lumber and wood products employment was 0.4 per cent lower than last year. In Oregon, where 42 percent of Pacific Coast lumber employ ment was located in 1961, the employment level this October was the lowest for the month since employment estimates were be gun in 1947. The decline was concentrated in logging and sawmills, 8 percent below last October. In contrast, plywood and veneer employment in the State was almost 4 per cent higher. Department store sales dip in October Twelfth District department store sales during October fell 1 percent below Septem ber after adjustment for seasonal factors and trading day differences. This compared fa vorably with sales in the nation, which dropped 7 percent between the two months. During the first three weeks of November, un adjusted figures for the District showed a gain of about 5 percent over the high level of ac tivity in the same period of 1961 with all metropolitan areas sharing in the increases. Autom obile registrations strengthened in October New car registrations in California during October totaled 61,149. While this was a rec ord for the month, registrations during March and June of this year were larger on both a total and daily average selling rate basis. Dur ing the month, the largest number of regis trations occurred during the first week fol lowed by a general tapering off during each subsequent week. Nationally, sales of domes tically produced automobiles were the high est for any month in the industry’s history, though daily average sales fell below May and April 1955. November sales continued at a high level reaching the highest daily aver age selling rate for any mid-month period. H eavy en gin eerin g construction g ain ed substantially in October Total contracts for heavy engineering con struction in District states rose 35 percent above September levels to reach a value of S317 million for the month of October.1 Too much significance should not be attached to the sharp October increase, however, because it represents only a partial recovery from a somewhat depressed September level, which was down 43 percent from August. Private construction gained by 40 percent above Sep tember levels, with contracts for commercial buildings mainly responsible; contracts for mass housing and industrial buildings also in creased. Public works projects increased 31 percent, largely due to a trebeled volume of nonresidential building contracts. Awards for streets and roads also increased somewhat, but most other categories of public works de clined. As compared with October 1961, total heavy engineering awards were nearly onefourth higher, but this was chiefly due to a more than doubled rate of private contract awards; contracts for public projects rose only 5 percent. Prospective hom ebuilding d isp layed m ixed trends in Septem ber an d October Applications to FH A District insuring of fices for mortgage insurance on new homes fell 30 percent below August levels in Sep tember and declined even more as compared with September 1961. Applications for exist ing homes declined about 19 percent below their August level, but dropped only 11 per cent below last year’s level. New housing units started under FH A inspection fell more than one-fifth below their August level in 1As reported by E ngineering N ew s-R ecord for the “ Far W est,” which includes the entire area of all Twelfth D istrict states. 213 F E DERA L RESERVE BANK SAN FRANCISCO September, in contrast to month-to-month gains in the preceding three months, and they also dropped below September 1961 levels. creased supply of funds to the mortgage mar ket, follows declines in these holdings in nearly every month since April. M o rtg a g e s rates sh o w ed some further e a s e in October Lumber markets m ixed in N ovem ber; fir orders decline w h ile pine orders improve According to a survey of the F H A ’s insur ing offices as of November 1, the average in terest rate charged on conventional mort gages in the West (includes Wyoming and Montana in addition to all District states) was 6.15 percent on loans to purchase new homes. This rate was unchanged from October and 5 basis points below its September level. The comparable rate on loans to buy existing homes was 6.25 percent, 5 basis points below the October 1 level. Both rates are at their lowest levels since May 1960, when these data first became available. The same survey in dicates that the average net price paid in the West for FHA-insured home mortgages (25-year, 10 percent down, sale for immedi ate delivery) on the secondary market rose $0.20 to $97.60per $ 100 on November 1. District sa v in g s an d m o rtgage lending rose in October 214 OF Savings accounts at reporting District sav ings and loan associations increased 1.6 per cent during October; this gain was at about the same rate as in prior months this year, if allowance is made for quarterly crediting of accrued interest in March, June, and Sep tember. Mortgage lending rose 2 percent dur ing the same period. Borrowing from the Home Loan Bank by associations gained about 9 percent, and reported loan commit ments rose 4 percent during October after showing declines in the two previous months. A report from the Los Angeles office of the Federal National Mortgage Association in dicated that there was an increase in the num ber of mortgages held by the Association’s Secondary Market Operation during October. This gain, which would tend to indicate an in Mild weather across the country forestalled the usual October seasonal declines in build ing activity and lumber orders. There does not appear to be anything which could sig nificantly increase lumber demand for the rest of the year, however. Ordering is being con fined to immediate needs with quick delivery a requirement. For many months Canadian cargo mills have been building up stocks and trying to avoid disrupting the United States East Coast cargo market during the tariff hearings. On November 2, however, the market broke, and the best estimate is that more than 100 million feet has been booked by the British Columbia mills at prices $3 to $5 below the October level. Most of the footage was taken for ship ment in December and early January. Orders for Douglas fir in October were 14 percent above their depressed September level and just fractionally above production which advanced almost 9 percent. However, while production was almost 7 percent above its level a year ago, October orders exceeded their corresponding level by only 3 percent. Production outpaced shipments in October so that inventories rose slightly but were still almost 18 percent below last year’s level. Inventories of fir continued to accumulate during the four weeks ended November 17. Although production declined slightly, output exceeded both new orders and shipments. During the same period, orders and ship ments of pine increased and were brought into an improved position relative to produc tion which showed little change. New orders for California redwood in Oc tober were almost 31 percent higher than Sep November 1962 MONTHLY REVIEW tember and 6 percent above their level a year ago. Production, which exceeded orders and shipments, increased almost 19 percent but was approximately 6 percent below last year. The relationship of unfilled orders to stocks showed improvement over last year, since or ders on hand were well above their level in October 1961 while stocks were lower. The continued decline in Crow’s average lumber price since July was extended from October 25 to November 22. The composite price per thousand board feet fell $0.26, or 4/10 of 1 percent, as the result of lower prices for green fir and dry fir which were not offset by a fractionally higher price for pine species. The average was 2.1 percent above last year’s level, however. District steel production declined in October an d held stea d y in N o vem ber w h ile national steel output rose Twelfth District steel production declined 3.6 percent in October while national steel output rose 3.9 percent under the influence of increased orders from automobiie produc ers. Subsequently, Western1 steel production showed no overall change during the four weeks ended November 24. National steel output, however, advanced 2.2 percent to reach 61.2 percent of estimated present ca pacity. This was the highest level of weekly output since the week ended April 28, which was one month after the settlement of the labor contract and the beginning of inventory liquidation. Seasonal factors contribute to a dim steel outlook in the District for the rest of the year. Production for 1962 will be significantly low er than 1961, since on a cumulative basis through November 24, Western steel output was running 10 percent below its level for the comparable 47-week period last year. Steel compamies outside the District have raised their production forecasts for the remainder 1Twelfth District states (Arizona, U tah, W ashington, Oregon, and C alifornia) are included plus Colorado. of the year, however. Improvement in orders from nonautomotive customers as the result of the end of inventory liquidation as well as the continued rise in steel orders from auto mobile manufacturers have led steel compa nies to forecast that the usual year-end lag in orders and output will be averted this year. Production nationally in 1962 should exceed or at least equal 1961, since through the week ended November 24, national steel produc tion was ahead of its level for the comparable period of 1961 by 2.4 percent. N ovem ber copper shipments expected to equal slightly improved October level Copper producers report that November shipments will be close to the October level which was stimulated at the end of the month by the Cuban crisis. Copper output figures for October issued by the Copper Institute did not show evidence of the mine cutbacks an nounced in July and September by United States and foreign producers to alleviate the problem of excess world supply. Although foreign mine output rose only slightly in October, United States mine production rose almost 11 percent to attain the highest level since the record output reached in May. Unit ed States production of refined copper in creased almost 19 percent, was 6 percent above its level a year ago, and far outpaced shipments. Deliveries to fabricators rose only 5 percent from September and were 3 per cent below the level of deliveries in October 1961. The considerable increase in producers stocks was a disappointment to the industry and brought inventories to the highest level since March 1961 and almost 58 percent above October 1961, Littie ch an ge in District petroleum industry The run of crude to stills in the District held steady at the October rate during the FEDERAL RESERVE BANK W estern petroleum refining operations rem ain at high level in S e p t e m b e r M i l l i o n s of B a r r t l t , Daily A v e r a g i OF SAN FRANCISCO higher. The heavy movement of seasonal fruit to market in Oregon dropped the farm price index for crops in that State to the lowest level in three years. District farm prices in October averaged about the same as in Sep tember. Local market prices of selected farm products in late November indicated some strengthening in farm prices. Potato, citrus, and beef prices showed the greatest advances and were as much as 75 percent higher than a year earlier. District banks experience reserve pressure 1961 1 9 62 N ote: Twelfth District includes Alaska, California, H aw aii, N e vada, Oregon, a n d W ashington. D a ily average run of crude to stills. Source: U nited States Departm ent of Interior. early part of November. Usually some in crease in the daily rate of production can be expected between the two months. The ab sence of a pickup in refining activity may stem from somewhat higher stocks of gaso line, kerosene, and distillate than a month earlier. Nevertheless, demand and supply of major refined products were in relatively good balance with prices of gasoline at the retail level remaining firm. Record farm returns Returns of District farmers from market ings in September eased below the same month in 1961 for the first time since early in the year. Nevertheless, they were relatively high. With downward revisions in cash re ceipts estimates for 1960 and 1961, returns from marketings for the first three quarters of 1962 were at a record level. Prices received by District farmers in Sep tember displayed diverse movements from a year earlier. Crop prices generally were below 2i 6 a Year earlier while livestock prices averaged From mid-October through mid-Novem ber Reserve City banks in the Twelfth Dis trict were under some reserve pressure as the increase in deposits at some of the banks failed to keep pace with seasonal loan expan sion. This tightness was evidenced by District banks’ net purchases of Federal funds during most of this four-week period and by some borrowing from the Federal Reserve Bank to cover temporary reserve deficiencies. A few banks also sold substantial amounts of short-term United States Government secu rities. Reserves released by the reduction in required reserves against time deposits from 5 to 4 percent (effective October 25 for Re serve City banks and November 1 for coun try banks) were largely offset by other fac tors, and in the week ended November 7 Re serve City banks had negative free reserves MONTHLY REVIEW November 1962 CHANGES IN SELECTED BALANCE SHEET STEMS OF W EEKLY R EP O RT IN G M E M B E R BANKS IN LEADING CITIES (dollar am ounts in m illions) Twelfth D istrict From Nov. 15, 1961 to Nov. 14, 1962 Dollars Percent From Oct . 10, 1962 to Nov. 14, 1962 Percent Dollars ASSETS: Tolal loans and investments Loans adjusted and Invest ments1 Loans adjusted1 Commercial and Industrial loans Real estate loans Agricultural loans Loans to nonbank financial institutions Loans (or purchasing and carrying securities Loans to foreign banks Other loans Loans to domestic commercial banks U. S. Government securities Other securities LIABILITIES: Demand deposits adjusted Time deposits Savings accounts + 230 + 0.84 + 1,771 + + 261 + 183 + + 0.97 1.03 + 1,660 + 1,944 + + + 68 98 2 + + + 1.14 1.61 0.23 + + + + 43 + 4.66 — — + 56 34 63 584 + 0.46 + 7,172 + 6.00 + 6.51 + 12.20 454 + + 1,272 + 0.37 + 1.64 + 6,628 + 6,538 + + 5.61 9.03 463 779 128 + 8.28 + 14.37 + 17.61 + + + 532 301 115 + 1.56 + 2.00 + 8.67 + 2,472 + 1,997 + 226 + 7.69 + 15.00 + 18.59 + 147 + 17.97 + 70 + 1.14 + 803 + 14.82 — 19.24 — 12.83 + 1.76 — + 17 10 464 — 6.75 + 4.52 + 14.62 + — 138 8 129 + 3.26 — 1.23 + 0.72 — 468 + 92 + 1,593 — 9.67 + 16.67 + 9.64 — 31 5 73 — + — + 9.42 0.08 2.47 111 939 655 + 59.36 — 13.02 + 27.64 — + 130 919 101 + 7.39 — 2.92 + 0.67 + 544 — 3,587 + 3,677 + 40,42 — 10.50 + 31.84 + 233 — 40 + 95 + — + 1.95 0.27 0.79 108 + + 1,770 + 1,383 + 0.90 + 13.47 + 12.96 + + + 820 335 285 + 1.34 + 0,69 + 0,84 — 580 + 7,715 + 4,619 — 0.92 + 18.79 + 15.54 + + + + + 6.89 United States From Oct.. 10, 1962 From Nov. 15, 1961 to Nov. 14, 1962 to Nov. 14, 1962 Dollars Percent Dollars Percent + + + 1 Exclusive of loans to domestic commercial banks and after deductions of valuation reserves; individual loan items are shown gross. Source: Board of Governors of the Federal Reserve System and Federal Reserve Bank of San Francisco, of $20 million, that is, borrowings from the Federal Reserve Bank exceeded excess re serves by that amount. Several seasonal fac tors may be expected to exert some pressure on bank positions in the latter half of No vember. The usual preholiday increase in currency in circulation tends to reduce the amount of vault cash held by banks, and the payment of Christmas Club accounts around mid-November results in lower holdings of individual time deposits, at least for a tem porary period. Total loans rise, but business borrow ing la g s In the period from October 10 to Novem ber 14, District weekly reporting member banks registered a $183 million increase in total loans (adjusted to exclude loans to do mestic commercial banks). This was a slight ly better performance than in the correspond ing period in 1961. The gain in business bor rowing, however, was only one-third of the increase for the comparable period a year ago and was largely concentrated in seasonal ex tension of credit to food and liquor proces sors and to retail trade firms. As shown in the accompanying table, the dollar increase in real estate loans was greater than for busi ness loans and widened the margin by which outstanding real estate loans exceed loans to commercial and industrial firms. This rela tionship has existed since July of this year and is a reversal of the situation that pre vailed in the preceding nine months. The net increase in credit extended to sales and personal finance companies by weekly 217 FEDERAL RESERVE BANK OF SAN FRANCISCO Table 2 T able 1 CHANGES IN C O N S U M E R L O A N S C H A N G E S IN R E A L E S T A T E L O A N S OF T W E L F T H D I S T R I C T M E M B E R BAMHS OF TWELFTH DISTRICT M EM B E R B A N K S (in m iilions of dollars) (In m illion s of dollars) S e c u re d b y f a r m la n d s 19S2 2nd quarter + 300 + 311 00 + Total r e a l e s ta te lo a n s 3rd quarter + + + 12 S e c u r e d b y r e s id e n tia l p r o p e r t ie s In s u r e d b y F H A + 5 54 In s u r e d o r gu a ra n te e d by V A — N o t in su r e d b y e ith e r + 177 — 3 218 47 P a s s e n g e r a u t o m o b ile in st a lm e n t lo a n s 45 103 34 O t h e r re ta il c o n su m e r in st a lm e n t lo a n s 4 1 12 14 „ 4 6 42 — 5 —-2 0 58 + 171 + 11 O t h e r in st a lm e n t lo a n s + 83 S in g le p a y m e n t lo a n s reporting banks brought outstandings to $400 million, a level that has prevailed gen erally since June, and outstanding loans to other nonbank financial institutions rose to above the $500 million level reached in midSeptember. The continued high rate of auto mobile sales probably contributed to the in crease in loans to consumers, which are re flected in the “other loan” category. The ma jor decline for this period was in loans for financing United States Government securi ties as brokers and dealers repaid substan tial amounts borrowed in early October. There was virtually no change in total holdings of United States Government secu rities by District weekly reporting member banks from October 10 to November 14, al though there were shifts among the various categories. Banks acquired over $150 mil lion of the 1-year Treasury bills issued Octo ber 15 and then sold or ran-off bills during three of the four succeeding weeks. There was a continuation of the shift toward longer maturities as banks sold securities in the 1to 5-year range and purchased longer term issues. After two months of reductions, banks resumed net acquisitions of securities other than United States Governments. 46 T o tal lo a n s to in d iv id u a ls f o r p e r s o n a l e x p e n d it u r e s — -22 00 65 1st quarter 15 — n + 53 1962 2nd quarter R e s id e n t ia l r e p a ir a n d m o d e r n iz a t io n in s t a lm e n t lo a n s + Se cu re d b y o th e r p r o p e r t ie s 1 + 17 3rd quarter 1st quarter — 17 39 District reporting banks ended the week of November 14 with a $233 million gain over October 10 in demand deposits adjust ed, but this was partly offset by a decline of $129 million in United States Government deposits. The steady gain in time deposits was temporarily interrupted during this pe riod. Net withdrawals of time deposits by states and political subdivisions and early payments of Christmas Club accounts by some banks more than offset the savings de posit gain, resulting in a net reduction of $40 million in total time deposits. M o rtg a g e lending rem ains high but consumer borrow ing declines in third quarter The data from the September 26 Call Re port of Condition of member banks in the Twelfth District revealed the continued inter est of District banks in expanding their real estate portfolios as a means of increasing earnings to cover higher costs associated with interest payments on time deposits. The to tal increase in mortgage lending was $300 million in the third quarter— practically the same dollar amount as for the second quar November 1962 MONTHLY REVIEW ter. As shown in Table 1, the largest gain was in conventional mortgages. Loans on com mercial and industrial properties, however, expanded substantially less than in the first two quarters of the year. Reflecting some sluggishness in consumer demand, increases in consumer loans in the third quarter dropped back to the first-quar ter rate and were less than one-fourth the dollar increase in the second quarter. While seasonal factors probably accounted for the smaller gain in loans to finance automobile purchases, the increases in the other con sumer instalment loans were also generally lower than in the second quarter, and single payment loans registered a decline. Revision of industrial Production Index The industrial production index compiled by the Board of Governors of the Federal Reserve System has been shifted from a 1957 to a 1957-59 base. For the period since 1957, all seasonal adjustment factors have been reviewed and a few of the underlying production series have been revised. A description of the revision and the detailed results are available in a booklet entitled, Industrial Production—• 1957-59 Base. This publication may be obtained for $1.00 per copy or $.85 apiece for 10 or more copies in a single shipment. Orders should be addressed to the Division of Administrative Services. Board of Governors of the Federal Reserve System, Washington 25, D. C. 219 FE D E RA L RESERVE BANK OF SAN FRANCISCO BAN K IN G AND CREDIT STATISTICS AND BUSINESS IN D E X E S — TW ELFTH DIST RICT 1 ( I n d e x e s : 1 9 5 7 - 1 9 5 9 = 1 0 0 . D o l l a r a m o u n t s in m i l l i o n s o f d o l l a r s ) Condition items of all member banks2- 7 Bank debits index 31 cities1' 5 Total nonagri cultural employ ment Bank rates on short-term business loans6’ 7 Demand deposits adjusted3 Total time deposits 495 720 1,450 6,619 6,639 7,942 7,239 6,452 6,619 8,003 6,673 6,964 8,278 1,231 951 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 19 8 11 6o 69 71 80 88 94 96 109 117 125 3.95 4.14 4.09 4.10 4.50 4.97 4.88 5.36 5.62 5.16 8! 86 85 90 95 98 98 104 106 108 17.901 18,212 18,499 8,190 8,182 8,278 13,901 13,944 14,163 14,867 14,874 15,116 134 122 135 5^42 18,646 18,622 18,906 19,070 19,328 19,625 19,669 20,017 20,165 20,460 8,082 7,820 7,776 7,811 7,582 7,689 7,532 7,309 7,471 7,471 13,671 13,163 13,235 13,706 13,945 13,101 13,535 13,255 13,446 13,969 1.5,448 15,647 15,939 16,091 16,352 16,511 16,587 16,655 16,772 16,934 136 133 138 143 140 145 145 138 143 146 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.S12 16,537 17,139 IS .499 1901 O ctober N ovem ber Decem ber 19G2 Ja n u a ry F ebruary M arch A p ril M ay Ju n e Ju ly A ugust Septem ber October U.S. Gov’t securities 5^50 5.52 5.40 Crude Refined Retail food prices 7, 3 82 86 84 90 96 101 96 103 103 102 18 11 19 73 74 74 82 91 93 98 109 110 115 53 34 38 95 93 93 92 94 97 101 101 103 104 109 109 109 104 105 105 100 102 104 115 118 120 104 104 104 110 110 111 111 111 111 112 112 113 113p 106 106 106 107 106 106 107 108 109 109 p 107 106 104 104 99 100 106 105 107 105 119 120 123 118 121 123 123 124 122 121 105 105 105 105 106 106 105 105 106 106 Exports Cement Dep't store sales (value)5 Waterborne Foreign Trade Index7’ s> 10 Petroleum’ Lumber Car loadings (number)5 llO r 56 r 83 r 108 108 103 112 112 103 96 101 95 94 .... Industrial production (physical volume)5 Year and month Total mf’g employ ment Electric power Imports Steel1 Copper7 Total Dry Cargo Tanker Total Dry Cargo 1929 1933 1939 1951 1952 1953 1954 1955 1956 1957 1958 1959 1960 1961 87 36 65 102 105 106 105 111 109 96 98 106 100 99 91 54 70 111 112 114 111 111 109 106 98 96 95 96 61 39 49 87 90 95 92 96 100 103 96 101 104 108 34 17 35 80 77 82 83 90 97 93 99 108 101 105 13 11 17 58 61 69 73 82 89 95 97 107 115 124 96 55 82 94 86 71 67 84 101 116 89 95 122 61 193 * 43 78 81 56 57 72 105 124 86 90 123 i90 137 102 113 96 116 91 96 96 108 116 20 12 16 27 33 51 44 51 75 95 92 112 132 55 i6 97 92 105 85 102 108 114 94 92 102 111 89 15 70 101 100 98 90 104 114 113 101 86 112 119 '42 60 60 70 71 80 86 93 95 113 115 " i 7 18 41 28 35 69 97 91 112 136 1961 Septem ber O ctober N ovem ber Decem ber 101 100 103 97 96 96 96 96 110 111 112 110 102 107 114 95 113 117 107 107 120 129 128 126 125 132 130 125 109 105 129 138 128 125 134 150 59 52 115 105 138 143 124 119 119 132 113 117 149 150 130 120 1962 Ja n u a ry February M a rc h A p r il M ay Ju n e J u ly A u g u st Septem ber 97 103 104 102 104 99 101 96 94 94 95 95 96 96 96 97 96 108 110 106 105 108 112 115 114 113 103 95 109 120 113 100 110 114 109 119 120 112 98 107r 103 r 84 r 90p 91 p 121 138 130 140 136 130 112 11 or 120p 132 126 130 124 137 133 107 134 104 82 131 143 124 121 145 121 85 102 123 130 67 103 59 74 125 94 120 140 137 156 111 107 128 117 138 132 132 86 116 154 137 171 Tanker 1 A d ju s te d for seasonal variation, except where indicated. Except for b a n k in g an d credit a n d d e pa rtm e nt store statistics, all indexes are based u p o n d a ta from outside sources, as follows: lum ber, N a tio n a l L um ber M a nu fac ture rs’ A ssociation, W est C oast L u m b e rm a n ’s A ssociation, an d W estern Pine Association; petroleum , cement, an d copper, U .S. Bureau of M ines; steel, U .S. D e p a rtm e n t of Com m erce a n d A m erican Iro n a n d Steel In s titu te ; electric power, Federal Power C om m ission; non agricu ltural an d m an ufac tu ring e m ploy m ent, U .S. B ureau of L ab o r Statistics a n d cooperating state agencies; retail food prices, U .S. B ureau of Labor Statistics; carloadings, various railroads and railroad associations; a n d foreign trade, U .S. D e p a rtm e n t of Com m erce. 2 A n n u a l figures are as of end of year, m o n th ly figures as of last W ednesday in m o n th . 3 D e m a n d deposits, excluding in te rb a n k an d U .S . G o ve rn m en t deposits, less cash item s in process of collection. M o n th ly d a ta p artly estim ated. 4 D e b its to to ta l deposits except inte rb a nk p rior to 1942. D e b its to d em and deposits except U .S. G ove rn m en t an d in te rb a n k deposits fro m 1942, 6 D a ily average. 6 Average rates on loans m ade in five m ajo r cities, weighted b y loan size category. 7 N o t ad ju ste d for seasonal va riatio n. 8 A new index now co m b inin g n o t o nly Los Angeles, San Francisco, an d Seattle food indexes b u t also P o rtland . Rew eighted by 1060 Census figures on p o p u la tio n of standard m e tro p o lita n areas. 9 C om m ercial cargo only, in physical volum e, for the Pacific C o ast custom s districts plus A laska an d H aw a ii; starting w ith J u ly 1950, “ special category” exports are excluded because of security reasons. 10 A laska a n d H a w a ii are included in indexes beginning in 1950. p— Prelim inary. r— Revised. * Less th a n 0.5 percent. 220
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