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MONTHLY BUSINESS REVIEW o f the Volume 27, No. 10 FEDERAL RESERVE BAN K o f Dallas This COpy Is released for publication in afternoon papers Dallas, Texas, December 1, 1942 DISTRICT SUMMARY The value of construct ion contracts awarded in the Eleventh Dist rict during October exceeded t he previous all-time peak established in August. T he daily average production of crude petroleum increased slightly during October, but was 5 per cent lower than in the same month last year. Although drilling activity was slightly higher in October, t he rate of well completions was only about one-third of that in October, 1941. Production of cot tonseed products at Texas mills increased seasonally during October and was somewhat higher than last year. Consumer purchases at reporting department stores increased by less than the usual seasonal amount during October, but were 31 per cent higher than a year earlier. Similar in~reases occurred in retail furniture sales. Loans of weekly reportI!1g member banks increased for the second consecutive month, but were still substantially below those last year. The rate of increase in member bank holdings of United States Government ~ecurities increased sharply. Intermittent rains delayed harvestI!1g operations during October and the early part of November, but caused little damage to most crops. BUSINESS The value of consumer purchases at reporting department stores in the Eleventh District increased 10 per cent from Septembel: to October and was 31 per cent above that in October, 1941. Sales of all types of piece goods, small wares, readyto-wear accessories, women's and misses' ready-to-wear, as well as sales in basement departments, were well above those: of last year. On the other hand, sales of furniture and some items of house furnishings and household appliances were smaller than a year ago. Tot al sales increased by less than the usual seasonal amount from September to October; consequently, this bank's adjusted index of department store sales declined further to 150 per cent of t he 1923-1925 average, but was still 37 points above that in October last year. . The ratio of cash sales to total sales was slightly higher durI!1g October and was considerably above that of a year earlier. The ratio of collections on both regular and instalment accounts Outstanding at the first of the month rose during October to the highest level of record, the respective ratios being 61 per cent and 25 per cent. . The dollar value of inventories at reporting department stores In this district increased slightly during October and was 3 per cent above that on October 31, 1941. The increase, however, Was less than is usual at t his time of the year, wit h the result that this bank's seasonally adjusted index of department store stocks declined for the third consecutive month, and at the end of October stood at 93 per cent of the 1923-1925 average. The value of outstanding orders increased further during October and at the end of the month was 30 per cent above that on the corresponding date last year. . Reports from 82 representative retail furniture firms in this district indicate that total sales increased about 16 per cent ~l'om September to October and were 22 per cent above those In October, 1941. The ratio of cash sales to total sales increased sl!ghtly from September to October and was conside.rably higher than in October last year. Accounts receivable cont1l1ued to decline, and at the end of October were one-third smaller than a year earlier, whereas collections were correspondingly great er. During recent months inventories have shown only small net changes, and at the end of October were 10 per cent above those of a year ago. The dema d for merchandise at reporting wholesale trade Dec. 2 fi rms in this district fel~ off about 4 per cent from September to October, but was still 6 per cent above that in October 1941. Most of the decline during the month occurred in sale~ of. gl'Oceri 7 and ~ardware, althoug~ sales of automotive sups piles.' surgical equl.pment and electrical goods also experienced ?ecilnes. These declmes, however, were offset in part by increases 111 the demand for drugs, tobacco and miscellaneous lines. The value of in ventories at reporting wholesale establishments which has shown a moderately downward trend since last Apra' continued to fall off during October, and at the end of th~ month was about 12 per cent lower than a year earlier. According to Dun and Bradstreet, Incorporated, there were 9 business failures in the Eleventh District during October, the same as in September, as compared with 12 in October, 1941. Although the number of failures in both September and October this year was the same, the indebtedness of defaulting firms declined 'hllrply from $462,000 in September to $ 84,000 in October. AGRICULTURE Harvesting operations were delayed by intermittent rains throughout most of the Eleventh District during October and the earl y part of November. However, little damage was caused to most crops. Grain and forage crops, fall sown small grains, pastures and truck crops were benefited by the improved moisture situation. In its November 1 report, the Department of Agriculture decreased earlier estimates of the district's corn cotton, rice and peanut crops, but production of all majo; crop' except cotton, oats and pecans is expected to exceed the respective 1930-1939 averages, and the harvest of only oats, barley, and pecans is likely to be substantially smaller than in 1941. Weather damage and delay in harvesting reduced the yield of cotton, particularly in northwest Texas. The November 1 es timate of the T exas cotton crop was 3,223,000 bales, or 180,000 bales smaller than the October 1 estimate. The indicated T exas crop for 1942 is 14 per cent below the 1930-1939 average production, but 22 per cent greater than the 2,652,000 bales harvested in 1941. The indicated per acre yield on November 1 of 190 pounds also represents a decline from the 201 pounds per acre forecast a month earlier, but is still substantially above the per acr.:: yield of 165 pounds in 1941 and the tenyear (1930-1939) average per acre yield of 154 pounds. Ginnings in Texas prior to November 1 totaled 2,162,000 running bales, or 70 per cent of indicated production, as compared with 1,498,000 bales, or 59 per cent of estimated production prior to the same date last year. The Louisiana cotton crop is expected MEMBER BANK RESERVES [l.LvtHnt rED(RAL RULRVE DISTRICT mL-__~____~---+----+---~----+----+----1---~m 6OO L-__~____~---+----+----+----+----+----1---~OOO >oo~__~____~--~----+----+----t----+----+----4'" This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) I /, MONTHLY BUSINEiS REVIEW to be almost double that of 1941, and estimated production in than three times that in 1941, and the yield per acre is someNew Mexico, Arizona and Oklahoma is well above actual pro- what larger than last year. The indicated production of pecans duction last year. A crop of 13,329,000 bales of cotton is fore- in Texas was reduced further during October, the November cast for the United States as compared with a production of 1 estimate being 8,800,000 pounds as compared with 10,350,10,744,000 bales last year. The per acre yield of 275 pounds 000 pounds on October 1 and a harvest of 22,100,000 pounds indicated for the current year is substantially higher than the in 1941. Texas truck crops made rapid progress during Octoyield of 232 pounds per acre in 1941. Through October, the ber as a result of favorable weather which prevailed throughout Commodity Credit Corporation had made loans on more than the month, and were only slightly retarded by light frosts and 450,000 bales of 1942 cotton, of which 60 per cent was pro- a brief cool spell which occurred in some sections of the State duced in Texas. As of the same date last year, loans had been during the first half of November. Truck crop prospects arc made oil approximately 400,000 bales of United States cotton. much better in Texas than in other vegetable prod ucing sections As the harvesting of the Texas corn crop neared completion, of the country, where weather conditions have been somewhat it became evident that production would be somewhat smaller unfavorable to crop development. The 1942-1943 Texas citrus than the earlier forecast. The November 1 estimate of 81,270,- crop showed some improvement during October. The estimated 000 bushels was 2,709,000 bushels below that a month earlier grapefruit harvest of 16,200,000 boxes exceeds production last and compares with the 1941 yield of 73,875,000 bushels and season by 1,700,000 boxes, or by approximately 12 per cent. Livestock in this district are entering the winter season in the 1930-1939 average harvest of 75,964,000 bushels. The corn yield per acre is approximately the same as in 1941 and good-to-excellent condition. Sheep and lambs are in good flesh, slightly below the ten-year average yield. Anticipated produc- and cattle and calves are carrying good weight and finish. tion of corn in Louisiana and Oklahoma is somewhat greater Above average range conditions, excellent wheat pastures and than in 1941. The United States crop is now estimated at abundant feed supplies assure ample feed and forage for the 3,185,000,000 bushels which, if realized, will exceed the pre- winter season throughout most sections of the district. A heavy vious record established in 1920 by 115,000,000 bushels, and movement of cattle t~ north and northwest Texas has conwill be 19 per cent above the 1941 crop. A record crop of grain tinued throughout the season to utilize grain pastures and the sorghums is indicated for Texas. The November 1 estimate of abundant feed supplies. Marketings of cattle and calves in Texas 82,118,000 bushels compares with 79,724,000 bushels produced were 27 per cent greater in September than in the same month in 1941 and the 1930-1939 average production of only 44,854,- of last year and total sheep and lamb marketings during Sep000 bushels. Harvesting of the crop in northwest Texas has tember exceeded the total of September, 1941, by 55 per cent. Marketings of Texas cattle and calves prior to October 1 were been delayed by the shortage of labor. Progress with the harvesting and threshing of the Texas rice 30 per cent greater than the total marketings of the same crop which permitted a more accurate appraisal of August period of last year and were only 2 per cent below the record storm damage resulted in an 11 per cent reduction in the esti- for the period established in 1937. Reports indicate that ranchmate for the current year. Estimated 1942 production of men are culling herds but are holding good heifers and ewe 17,472,000 bushels, however, is well above last year's crop of lambs for replacements. FINANCE 13,60 0,000 bushels and 65 per cent greater than the 1930 During the early part of the current year customer depositS 1939 average. The November 1 estimate of the Texas peanut crop reflected further weather damage, but the expected pro- at member banks in this district declined seasonally, but sin~e duction of 556,500,000 pounds is still by far the largest crop April there has been a marked expansion. The rapid rise 111 on record and exceeds 1941 production by approximately 400 ,- deposits during recent months reflected the luge marketings ~£ 000,000 pounds. Texas acreage in peanuts tIlls year is more farm products at high prices and the net Government expenditures in this area. The month-to-month increase in deposits was WHOLESALE AND RET,AIL TRADE STATISTICS particularly large after June, with the result that the combined ===::N;;t;Percentage ohange i n : - - - - gross demand and time deposits of all member banks in t he Number : Net sales Stoekst-of Ootober, 1942 from Jan. 1 to October. 1942 from Eleventh District averaged $2,469,000,000 during October. Retail trade: reporting Oetober. , Sept., Oct. 31. 1942 October. Sept., That amount is $386,000,000 above the June average and comDepartment .tore!: firl1l5 1941 1942 from 1041 1941 1942 Total 11th Dist.... 48 +31 +10 +11 + 3 + 1 pares with a net increase of only $43,000,000 during the nrst Dalla............. 7 +29 +12 + 4 + 3 + 2 half of the year. 4 +28 +12 +12 +15 - I Fort Worth...... .. Houston........... 7 +28 + 4 +11 + t + 8 During the first half of this year reserve balances of a!1 San Antonio.. ... .. 5 +48 + 8 +20 + 5 - 1 Shreveport........ 3 +16 +14 +13 member banks in the Eleventh Federal Reserve District showed -1 -6 Other eities.. ... ... 22 +35 +14 +13 a net increase of $18,500,000 and since June the month-tORetail furniture: -t +10 +16 Tetaillth Distriot. ~ 82 .r nf+22 month expansion in reserve balances has been at a sharply !n+31 +13 +9 Dalla. ............ 8 +27 +12 +2 +11 Fort Worth....... . 3 +17 creased rate. Thus, from July through October the average 111-1 - 4 +17 Houston........... 12 +15 crease for each month has been substantially greater than t~e - 4 +16 +16 San Antonio....... 6 +25 Independent stores:· . entire net increase for the first six months of the year. Thi 5 +13 +25 +11 Arizona........... 196 trend continued through the first half of November whe!1 - 1 +12 +12 New Mexico. . ..... 145 +12 +1 +16 Oklahoma.. .. .. . .. 450 average reserve balances of $435,064,000 were $52,000,~OO +4 +16 +6 TexlIB .... .. ....... 1,020 higher than the average for the same part of the preced1111 Wholewe trade:· Automotive supplies a;j!""l'.)l:-30 - 4 month, and $118,000,000 above those during the first half Ok +2 Drui. (iocl.liquOMl). 11 "li.~H35 +9 +24 , Electrioal good~. . . . 5 -26 - 9 - 15 June. On November 15 reserve balances of all member ball s +4 [ Groeerie.......... . 31 +20 - 6 +17 -4 were at a new peak of $4 52,126,0 00. Hardware.. .... ... 15 - 15 - 7 + 7 Suriical eqp't...... 4 - 7 - 5 +10 Due mainly to an expansion in customel' deposits at member Tobacco & product.. a - 13 +15 - 2 .Compiled by United States Bureau of Census. tChange less than one-half of one pcr cent. banks, a large part of the expansion in reserve balances has tstook. at end of month. been absorbed by increases in required reserves. Thus, from Jul~ through October required reserves increased at the rate 0 INDEXES OF DEPARTMENT STORE SALES AND STOCKS (1923·1925 averaie ~ 100) about $18, 000,000 a month, while excess reserves expanded at October ' !;~H ;October September AugJst the rate of $4-,500,000 a month. It is estimated that excesS reSales (daily average): 1942 1941 1942 1942 Without seasonnl adjustment. . . . . . .. 170 127 171 127 serves were at a new peak during the first half of November .. With seasonal adjustment. .. . .. .. .. . 160 113 Ib4 165 Federal Reserve notes of this bank in actual circulatl~ll Stocks (end of month) : 105 100 104 107 Without seasonal adjustment. . . . .•. . showed a net increase of about $24,000,00 0 during the nrst Sl~ With sellSonal adiustment. . . . . . . . . . . 93 89 9& 10& MONTHLY BUSINESS REVIEW months of this year, or an average monthly increase of $4,000,000. Due in part to seasonal factors, the rate of expansion increased sharply from July through October. During those four months there was a net expansion of $54,000,000, or an average monthly rate of $13,500,000. During the first half of November the average circulation of Federal Reserve notes of this bank Was at a new high level of $228,070,000, which amount was $19,000, 000 higher than the average for the first half of October and more than $100,000,000 greater than in the corresponding period last year. Total loans and investments of 33 weekly reporting member banks in the Eleventh District amounted to $906,978,00 0 on November 11, which was $56,230,000 greater than a month earlier and $248, 500,000 above the level on the corresponding date last year. These increases reflect principally purchases of United States Government securities in connection with the financing of the war effort. Total investments during the four weeks ended November 11 rose $53,453,000 to a new high of $595,149,000. In April the Treasury began to increase substantially the volume of short term Government securities, consisting of Treasury bills and Treasury Certificates of Indebtedness. Purchases of these offerings by reporting member banks in this district, between April 8 and September 23, increased their net holdings of Treasury bills by $37,500,000 and Treasury Certificates of Indebtedness by $89,100,000. The remainder of the increase in holdings of direct obligations of the United States Government during that period consisted almost entirely of United States Treasury bonds, while holdings of Treasury nOtes increased only $1,374, 000. Since the latter part of September the Treasury has offered a wider variety of issues designed to meet the needs of commercial banks, with the result that there has been a marked change in the types of Treasury securities purchased by reporting member banks. Between Septem?er 23 and November II, reporting member banks continued to Increase their holdings of Treasury bonds, but holdings of TreasUry bills and Treasury Certificates of Indebtedness showed a net decline of $7,600,000. On the other hand, holdings of Treasury notes increased $64,875,000 and holdings of Treasury bonds increased $32,142,000 during the seven weeks ended November 11. Thus, during the four and one-half months prior to September 23, about two-thirds of the increase in reporting member bank holdings of direct obligations of the United States Government consisted of Treasury bills and Treasury CertifiCates of Indebtedness, while holdings of Treasury notes were about unchan ged. Between September 23 and November 11 holdings of Treasury bills and Treasury Certificates of Indebt~dness have fallen off slightly, whereas two-thirds of the large Increase in holdings of United States Government securities has been accounted for by an expansion in the holdings of Treasury notes, and the remainder by increased holdings of Treasury bonds. . The loans of 33 weekly reporting member banks in this rlstrict continued the slight recovery which began in the atter part of September. On November 11 total loans of $311 ,829,000 were $2,78 0,000 higher than on October 14, but were $43,260,000 less than on the corresponding date last year. For the; second consecutive month commercial, industrial and agriC liltural loans accounted for a large part of the increase, al~hottgh there was also a sizable increase in loans to brokers and calers in securities. Other classes of loans showed only small net changes during the four-week period. INDUSTRY D . Tl~e value of construction contracts awarded in the Eleventh IStrlct during October, which amounted to $129,000, 000, exceeded th(! previous all-time peak established last August and Was more than 25 per cent greater than the September ~"'ard s, of $101,600,000. The continued heavy awards for overnment-f1nanced manufacturing facilities during October a CONDITION OF THE FEDERAL RESERVE BANK ( Thousand. of doll.rs) Nov. 15, Nov. 15, Oot. 15, 1942 1941 1942 Totnl c.sh reserves. . . . . . . . . . . . . . . . . . . . . . . .•. . . . . 1526,673 1408.831 $500,038 Discounts for member b. nks ... ........... .. ...... : 30 314 191 Industrinl ndv.noes .. " " .... .. .. . "" " ...... "" 133 273 134 United States Government seourities. . ... . . . . . ... .. . 179,486 76,551 150,076 All other investmenls. . . ... . . .. ......... .......... 145 None 145 Tot.1 e. rning assets ................. . ... . "...... 179,744 77,138 150,546 Member bnnk reserve deposits . .... . ............... 452,126 297,873 401,350 Federal Reserve notes in aotunl oiroul.tion.. .. ...... 228,594 126,917 211.959 Commitments to make industrinl .dvances. . . . ... . . . Nono 23 None CONDITION STATISTICS OF MEMBER BANKS IN LEADING CITIES ( Thousnnds of dollars) Nov. 11, Nov. 12, Oot. 14, 1942 1941 1042 'fot.l lonns .nd investments. . .. . . . . . . . . . .. . . . . . .. . 1906,978 S658,492 $850,748 Tot.lloa"s. . . . . . . . . . . . . .. . . . . .. . . . . . . . . . . . . . . . . . 311 ,829 355,085 309,052 Commeroi.l, industrial and ngrioulturallonns. . . . . . 228,279 244,608 225,710 Open m. rket paper. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 612 1,554 1,072 Lo. ns to brokers .nd dealers in seourities..... ... . . 3,314 5,483 2,375 Other lo.ns for purohasing or carrying seourities ... . 11,656 13,921 12,067 Ronl estate lo.ns. . . . .. .. .. .. . . . . .. .. .. .. .. . . .. . 20,182 23,362 20,028 Lonns to b. nks ...... " .. .. . . .. . . .. .. . . .. .. . . . . . 226 443 241 All other lo.ns .. ...... .... . . . . ......... .. " . . . . 47,560 05,714 47,550 Total investments. .. . . .. . . . . . . . . .. .. . . . . . . . . . . . . . 505,149 303,407 541,696 United St.tes Tre.sury bills. .. ..... .. . . .. . . ..... 08,875 38,803 79,176 Unit·ed States Trcnsury Cortifio.tes of Indebtedness. 82,866 None 79,187 United States Treasury notes. . ....... .. . . . .. . . . . 108,000 40,741 73,919 United States Government bonds .... . . . ... . . ..... 237,788 124,116 211,196 Obligations gu.ran teed by United States Gov't. . . . 37,936 38,651 38,685 Other seourities . . .. ..... ................. ".... 59,680 61,096 59,533 Reserves with Federal Reservo B.nk.. .. .. . .... . .... 278,765 184,026 262,612 Balances with domestic b.nks·... . . . . . .. . . .. .. . • . . . 286,141 303,229 271,888 Demand deposits- adjustedt. . . . . . . .. .. . . .. ... . . . . 807,403 613,057 776,956 Time deposits... . . . . .. . . . . . .. . .. . . . . . . . . . .. . . . . . . 130,088 132,460 128,948 United States Government deposits... ... . . . . . . .. . . . 61,283 21,166 34,201 Interbank deposits·. . ... . .. .. .. . . . . . . . . . ... .. . . . . . 4~l322 3271600 39~J166 BorrolVlDgs from Federnl Reserve B.nk. . ........... Nona NOno None OBeginning July ~, 1942, reoiprooal interbank demnnd bnl.nees reported on net b.sis. tInoludes .11 dom.nd deposits other th.n int~rbank .nd United Bt.tes Government, Ie .. onsh items reported as on h.nd or in prooess of oolleotion. DEBITS TO INDIVIDUAL ACCOUNTS ( Thousands of dolla",) Cotober Ootober Potg.oh.nge September Potg.ohango 1942 1941 over ye.r 1942 over month +13 14,977 Abilene . .. . .. ........... 1 20,843 1 18,447 +39 -2 Am.rillot .. · .. · ........ . ~::~~~ .. 4 il,os5 .. +4S" ~~:m Austin . . . " ............ . +21 42,320 32,932 +29 37,508 Be.umont . .........•. . •. +13 Corpus Ohristit . ........ . 37,957 .,. '5',6no' ' 37,317 ' ' .. 6,822 u 20 5,262 t8~ Corsioana . ......... .. .. . 469,239 423,238 11 421.188 Dall.s . ................ . +11 51,113 46,189 +11 46,635 +1 0 EI Pnso . ... " ......... .. 157,671 128,079 +23 143,029 Fort Worth ......... .... . +10 50,367 31,025 +62 32,430 Gn lvc.~ton ............. . . +55 429,033 362,204 +18 374,502 Houston ................ . l~ 9,351 8,095 Laredok ........ · .. ·· .. · 20,089 15,514 29 Lubboo ......... . .... . 18,298 17,284 6 Monroe, •.t ...... · .... · 16,640 .. '12:4ii "+84" 16,698 -t Port Arthur ........... .. 6,480 5,475 +18 5,355 +21 Roswell, N. M . .... . .... . 17,120 17,558 -2 S.n Angelot . ... .. .. .... . ' 149,213 . 't'02',676 .. +45 . . 105,328 +42 S.n Antonio ....... .. ... . 68,698 64,007 + 6 61,313 +12 Shroveport, La •. ......... 15,500 16,973 - 8 14,249 'foxarkaon· ........ . .. .. . 23,862 16,168 +48 22,948 Tueson, Ari ............. . 14,606 15,013 - 3 13,711 Tyler . . ...... .. . ...... . . 29,945 21,978 +36 26,253 +a Waco . ..... . .. . .. .... .. . 21,480 26,230 - 18 22,857 -4 \Viohi ta Falls ...... " ... . "t " f ti Tot.I-18 oitios ... ....... SI,638,874 11,373,400 +19 $1,417,687 +10 Tot.I-24 oities........ . . 1,786,627 1,559,610 +15 .Inoludes the figures of two oonlas in Toxark.na, Ark.ns••• loo.ted in the Eightb Diatrlot. tN. w roporting conter; d.ta prior to M.y, 1042, not availablo. tLess th.n ono-half of one pcr cent. GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS (Avor.(I. of d.ily figures-Thousands of doU.rs) Combined total Jl;lsorve oity b.nlas Country b.no GrOSll Gro>s Gross Time demand Time dem.nd Time demand 1940 .... ..... $1,408,515 1233,323 1 814 ,555 1128,205 $593,960 1105,028 Ootober, 105,017 962,113 132,050 700,353 Ootober, 1941 .......... 1,062,466 237,667 90,087 1042 .... . .... . 1,850,567 220,503 1,058,847 127,416 797,720 Juno, 99,382 226,047 1,095,607 127,015 818,906 1942 . . . ....... 1,914,513 July, 99,685 226,916 1,137,687 127,231 847,441 Augus\ 1942 ...... . ... 1,985,128 100,104 Septem er, 1942 .. ....... . 2,055,183 227,472 1,166,232 127,368 888,951 225,791 1,260,835 125,607 973,840 100,124 1942 .......... 2,243,075 O~tober, SAVINGS DEPOSITS Peroen ta~a ohange in Ontobor 31, 1942 savings eposits (rom Number of Number of Amount of O,tobor 31, Sept. 30, savings 8Ilvin~8 re~ortinll 1941 1942 depOS its depositors anlas + 2.4 10,840 $ 4,368,769 +l.9 3 Be.umont . . ....... . .... . 26,460,857 + .8 89,050 + 1.8 8 DaU.s .......... .. ...... 7,376,317 + .02 + 1.2 18,448 2 E! Paso . . . ....... .... ... 12,880,142 + .3 + 1.3 32,405 3 Fort Worth .............. 10,876,777 - 5.4 18,288 + .3 4 Galveston." . ........ . .. .2 32,601,229 + .1 74,521 10 Houston ................. + 2.1 597,548 + 6.1 1,326 3 Lubbock ................ - 4.0 3,108,771 - .2 5,170 2 Port Arthur ............. 18,334,000 + 2.7 +1.3 28,421 5 San Antonio ............. 3.4 11,658,181 - 8.4 24,905 3 Shreveport, Ln ... . ..• . ... 4,259,241 - 2.5 7,400 3 Waco .............. ·.· .. 2. 1 .01 1.4 3,440,501 0,599 3 Wiohita FaUs ........... . 1.1 27,756,880 - 3.8 51,484 62 All other . . ............ .. - - t - Total. ... . ...... III -- --- 363,953 $163,719,312 ~9 + .6 MONTHLY BUSINESS REVIEW indicate that a further expansion of war production in this last year, while stocks of crude petroleum outside of the disdistrict is in prospect. The volume of public works and the trict continued their downward trend with a decline of 4 per volume of utilities construction increased substantially over cent during October, and at the end of the month were 16 pcr September, and were somewhat greater than in October of last cent smaller than at the end of October, 1941. National stocks year. Awards for residential building, nearly all of which now of fuel oil rose slightly but at the end of October were 18 per represents defense housing, increased over the preceding month cent below the level of last year. and were only 11 per cent under the near record total in the same Drilling activity in the district was 3 per cent greater in month of 1941. The War Production Board recently placed October than in September, but the rate of well completions was construction machinery and equipment under allocations con- 64 per cent below the rate set in October, 1941. Drilling trol and specified forty-eight items of heavy machinery and activity outside of the district declined 8 per cent from the equipment which hereafter may be produced only for military September rate and was 33 per cent below that during the same uses. Further restrictions were placed upon private residential month of last year. The rate of drilling activity in this district construction, and some Federal awards were withdrawn. during the first ten months of this year was only about half Production of Portland cement at Texas mills in September of that during the same period of 1941. In the United States exceeded 1,000,000 barrels for the fifth consecutive month, but the rate of drilling declined about one-third. was somewhat smaller than production in August. During SepCotton consumption at United States mills increased less tember, shipments of cement from Texas mills declined more than seasonally during October but set a new record for the than 20 per cent from those in August. Stocks of cement at amount of cotton utilized during that month. According to Texas mills, which had dropped sharply during the preceding the Bureau of the Census, consumption of cotton at mills was four months, were partially replenished during September, but 972,490 bales compared with 966,149 bales consumed in Septhey were still more than 50 per cent smaller than stocks of a tember and 955,657 bales consumed in October, 1941. Inyear ago. Production of lumber during October continued on a ventories of raw cotton in consuming establishments increased smaller scale than shipments, bringing about a further decline seasonally during October and at the end of the month totaled in mill stocks. The volume of unfilled orders at the mills has 2,117,902 bales, which compares with the previous all-time peak declined from the peak reached earlier this year, but at the end for that date of 1,993,293 bales set last year. Current mill of October was still substantially greater than at the same time stocks now represent slightly more than a two month's supply last year. in relation to mill consumption. United States stocks of cotton Floods, breakdowns, train wrecks, and diversion of tank-cars in public storage and compresses increased almost 3,000,000 to other services have retarded rail movement of petroleum and bales during October, but were 5 per cent smaller than at the petroleum products to the East Coast since September. During end of October, 1941. the two week period ended October 24, tank-car deliveries of The average price of middling 15/16-inch staple at the ten petroleum to the East Coast averaged less than 800,000 barrels spot markets continued a moderate upward trend during the per day, and were about 47,000 barrels below the level of daily last half of October and was 19.48 cents per pound on Novemdeliveries during the comparable period of the preceding month. ber 5. Thereafter, prices declined slightly, and on November 14, The petroleum supply situation on the Eastern Seaboard be- the ten spot market average was 19.34 cents per pound, as comcame more critical during October and November as a result pared with 18.91 cents on October 15, and 16.39 cents per of the decline in petroleum receipts and expanding military pound on November 15, 1941. requirements for petroleum products. The basic passenger car Ginnings of cotton prior to November 1 were substantially gasoline ration was therefore reduced from four to three gallons greater than in 1941, both in Texas and in the United States, per week in the sixteen eastern states, effective November 22. and receipts of cottonseed at cottonseed oil mills were correDelays in the delivery of registration forms and ration books to spondingly larger. Production of cottonseed products at Texas local ration boards necessitated the postponement of the effec- mills in October was approximately 50 per cent greater than tive date of gasoline rationing in the remaining states from during September and somewhat greater than in October, 1941. November 22 to December 1. Shipments of products from Texas mills during the first quarter Early in November, the War Production Board approved of the current season have exceeded shipments during the comextension of the War Emergency "big inch" pipe line from parable period of 1941 by 40 per cent or more. Operations at Illinois to New York. The section of the line extending from United States mills have also increased substantially. BUILDING PERMITS Longview, Texas, to Illinois which will provide for the transPerccntage change Percenwg· portation of 300,000 barrels of petroleum daily is expected to October, 1942 :Ivaluation from Jan. 1 to Oct. 31, 1042 chan~o -::---:-:--:---:----:~---::-------.:.~ valuatlO" be in operation shortly after the first of the year. Readjustment No. Valuation Oct.,1041 Sept.,1042 No. Valuation from 10. 1 of pipe line facilities now under way will provide the emergency Abilene . ....... .. ~~ 5~:m =~~ +" ~~ 024 s 1,530,342 -:~~ "~~!:~n line with petroleum from such widely separated points in the Amarillo ......•.. 101 Austin .. . ...... .. 26,383 - 02 + 55 67 Beaumont . ......• district as West Texas and the Corpus Christi area. The Texas Corpus Christi. .. . 16~ l~i:~~~ =~~ tl~~ l:~!~ ~:~~~:~g~ ::~~ Railroad Commission has announced adoption of a policy which Dallas .. .. ... ... . 548 238,084 - 01 + 25 6,612 5,805,025 -58 EI Paso ..... .. .. 45 470,300 + 3 +048 547 2,424,523 -10 will allow East Texas producers to transfer to other wells on the Fort Worth .. .. .. .. 251 341,012 +54 +140 2,678 10,005,416 +74 Houston 116 - 00 +172 2,368 11,033,216 -35 same lease the allowable of wells which are not eligible for Lubbook ..... . . ... 120 168,036 ........ 10,430 -86 + 30 1,000 2,040,605 -27 7,706 - 05 - 30 717 340,614 - 69 pumping equipment under present regulations of the War Pro- Port Arthur . .. .. . 61 San Antonio ..... . 909 277,651 -58 + 53 8,202 4,106,319 -34 -40 duction Board. Shrevcport, La . . . 71 100,602 - 55 + 42 057 2,001,801 57 -20 + 65 583 1,144,681 - 70 The · daily average production of crude petroleum in the Waco ......... .. .. .. 34 124,871 64,903 - 02 + 27 316 582,850 -82 Wichita Falls .. Eleventh District was 2 per cent greater during October than _ 33 - 77 +110 28,b12 $54,836,440 Total ...... 2,605 $2,1 08,070 during the preceding month, but was 5 per cent below the level VALUE OF CONSTRUCTION CONTRACTS AWARDED of October, 1941. During the month, daily average production ( Tbounonds of dollara) October October September January 1 to Ootober 31 increased in all sections of the district except North Louisiana 1042 1941 1042 1042 1941 and the Texas Coastal area, where very slight declines were Eleventh District-totnl... 1128,001 $ 70,101 $101,554r $ 747,356 $ 306,~~~ Residential. . . . . . . . . . . . 16,064 .8,021 16,431 118,368 100, 55 experienced. Daily average production outside the district Allothcr ..... . ........ 112,837 52,080 01,123r 628,088 286,1 dropped slightly from September to October and was 4 per United States·-tolal..... 780,306 606,340 723,216 6,802,161 5, !17,~~ Residential .. .......... 161,206 171.772 126,708 1,501,427 1 ,73~'171 cent below production in October, 1941. Stocks of crude peAll other.. ............ 610,100 434,677 506,508 5,300,734 3,38 , troleum in the district continued to accumulate and at the end '37 States cast. of the Rocky Mountains. f'-R~vi.ed. SOURCE: F. W. Dodgc Corporation. of the month were 22 per cent greater than at the same time S m - MONTHLY BUSINESS REVIEW DECEMBER I, 1942 NATIONAL SUMMARY OF BUSINESS CONDITIONS (Complied by the Board of Gl)vernol's of the Federal Reserve System) INDUSTRiAl PRODUCTION -, Industrial output expanded further in October and the first half of November. Retail food prices continued to advance while prices of other commodities generally showed little change. Distribution of commodities to consumers was maintained in large volume. " / 180 180 ./ PRODUCTION / 160 160 f I" 140 120 \ / 100 hi 7 IV \ \ 140 J I ,J I 00 v / ~/ 80 19~6 1937 to 80 11/38 1939 11/40 1941 11/42 Federal Reserve monthly index of physical volume of production, adjusted for seasonal variation, 1985-89 average 100. Latest figures shown are fol' October 1942. = DEPARTMENT STORE SALES AND STOCKS Od ~ 0 14 0 140 130 ~ 120 J~V 110 ~ eo v eo I/ ~ 70 ..... .\ 1 / \ '-----$31 len jV -../ -c-~ 60 eo ." 180 100 len Int . Industrial pro~uction continued to advance in October and the Board's seasonally adjusted mdex rose three pomts to 188 per cent of the 193 $ - 19 39 average. Gains in armament production accounted for most of the increase, and it is estimated that currently well over $0 per cent of total industrial output is for war purposes. In lines producing durable manufactures, approximately 80 per cent of output now consists of products essential to the war effort. I 1840 ,,1 ~. .. 20 I 10 I 00 " DO' Value of construction contracts awarded in October increased somewhat over that of September, according to reports of the F. W. Dodge Corporation. Publicly-financed projects continued to account for over 90 per cent of total awards. The Department of Commerce estimates that, in the third quarter of 1942, expenditures for new construction amounted to 4.2 billion dollars, of which 3. $ billion came from public funds. For the first nine months of this year the corresponding figures were 10.2 and 7.7 billion dollars. Construction of military and naval facilities and of industrial buildings accounted for the bulk of the expendi· tures. DISTRIBUTION 80 70 60 194' Steel output reached a new high level in October as production expanded to 100 per cent of rated capacity. In the first half of November output declined slightly to around 99 per cent, reflecting some shutdowns for furn ace repairs, according to trade reports. Activity in industries producing nondurable goods declined less than seasonally in October. Production of foods, especially canning, was unusually large for this time of year and output of textiles continued at a high level. Mineral production, which usually increases in October, declined slightly this year owing chiefly to a decrease in coal production which had been maintained in large volume throughout the summer. • 1942 Federal Reserve monthly indexes of value of sale8 and stocks, adjusted for sensonal variation, 1928-25 average 100. Latest figures shown are for October 1942. = Department store sales increased in October and the Board's seasonally adjusted index rose to 129 per cent of the 192 3-192 $ average as compared with 123 in September and 13 0 in August. In the first half of November sales increased further and were 17 per cent larger than in the corresponding period last year, reflecting in part price advances of about J 0 per cent. Railroad shipments of freight were maintained in large volume during October and declined seasonally in the first half of November. OOST OF LIVING COMMODITY PRICES f7'- 130 120 130 120 CUlTH ~ 110 100 t - -+ -- I----1- ................~ .L _~ ............ 1 ._ . :::::::.'C;;;;.9=:/ ' ./~'- .A--- _ 110 100 80~~~~~~~~~-L~~L---~--.J 80 1937 1938 BANK CREDIT II tll ' 90r---i----+--~+_~~--~----+_--~ 90 1836 Retail food prices continued to advance sharply from the middle of September to the middle of October and further increases are indicated in November, Prices of most other goods and services increased slightly in this period. In the early part of October maximum price controla were established for a number of additional foods. Maximum price levels for many other food products have been raised, howeve.r, and the Office of Price Ad~inistration .reports on the. basis of a recent survey that in numerous mstances sellers are not complymg fully with the regulatIOns now in effect. 11/39 1840 1941 194. Bureau of Labor Statistics' indexes, 1985-89 aver!,ge 100. Fifteenth of month figures . Last month In each calendar quarter through September 1940, monthly thereafter. Latest figures shown are for for October 1942. = Excess reserves of member banks were 2.5 billion dollars in the middle of November, a somewhat higher level than generally prevailed in the preceding four months. At New York City banks eXCeSS reserves amounted to about 500 million dollars. Additions to member bank reserve balances during the four weeks ending November 18 were the net result of an increase of 500 million dollars in Reserve Bank holdings of Government obligations, which approximately covered the continued heavy currency drain, and a decrease of 200 million in Treasury balances at the Reserve Banks. EXOESS RESERVES OF MEMBER BANKS Holdings of Government securities by reporting banks in 101 cItIes increased by 1.9 billion dollars to 24 billion during the four weeks ending November II. Almost half of the increase occurred at New York City banks. There were substantial increases in holdings of Treasury notes, bonds and certificates, and a smaller increase in Treasury bills, while holdings of guaranteed obligatio;s declined. These changes reflected new offerings and retirements by the Treasury during the period. Commercial and industrial loans at reporting member banks in leading CIties increased somewhat during the first two weeks of November. Br~kers' loans in New York City increased around Government financing dates, but subsequently decltned. UNITED STATES GOVERNMENT SECURITY PRICES o 0 1836 IDST ! l8~e 1'3. 1840 1841 1942 Wednesday figures, partly estimated. Latest figures shown are for November 11, 1942. Prices of United States Government securities were steady in the four weeks ending November 18. Long-term taxable bonds yielded 2.32 per cent, and 3-month Treasury bills sold at a yield of 0.37 per cent. MONTHLY BUSINESS REVIEW OASH FARM INCOME FROM THE SALE OF PRINCIPAL FARM PRODUCTS (Thousands of dolla...) ~Augu sl, - ~~i~i:~~ . . ·.::: ::: :::::: : New Mcxioo . . . . . . . ..... . Oklahoma . ... .. ...... .. . Texas .. . .. . .. ... ... . .. . . 1942 - - - - - - T o t a l receiptsl---- Receipts from: ~ August August Jan. 1 to August 31 Crops Livestock" 1942 1941 1042 1041 1,204 1,840 3,143 2,011 61,035 46,871 4,044 3,860 8,813 6,384 72,035 54,342 1,894 2,601 4,405 4,133 32,914 25,292 16,228 23,055 38,2& ~ 30,044 195,170 120,926 54,403 36,434 90,837 82,507 473,230 360,587 67,808 145,571 124,070 834,303 Tolal. . . .. .... .... 77,763 "Includes rcceipts from the sa1c of livestock and livestock producta. SOURCE: United States Department of Agriculture. 617,018 LIVESTOCK RECEIPTS-(Number) - - - F o r t Worthl---~-- San Antonio - - - October October Sept. October October Sept. 1942 1941 1942 1942 1041 1042 Cattie .... . . .. .. .... . ... . 101,259 65,206 95,984 31,450 10.067 24,461 Calves . ... .. . .......... . 65,042 64,617 60,909 44,896 28,817 35,369 46,844 33,178 66,307 11,346 14,607 13,268 220,036 42,250 218,004 37,220 11,908 31,946 fhe~~:: : ::: ::::: ::::::: : COMPARATIVE TOP LIVESTOCK PRICES (Dolla... per hundredweight) Fort Worth San Antonio - - - Beehte...... .. . ...... ... . Stockcr stce ...... . .. ... . . . Heife... and yearlings . .. . . Butcher Cows ............ Calves . ... .... . . .. . .. ... Hogs .... . . . ..... . .. . . . . . Lambs .. ... . . .. . . .. . . . .. October 1942 S14.OO 12.00 14 . 65 10.75 12.75 15. 00 13 .50 Ootober 1941 Sept. 1042 October 1942 112 .00 113 .75 112.50 10.50 12. 00 8 .00 10.50 11.20 11.00 12.00 14. 75 10. 25 13.00 15 .00 14 .00 .i:i:2ii 9.75 12.50 14 . 65 12. 00 October 1941 $10.40 11.25 7 .50 11.00 10.75 0.00 Sept . 1942 112 .bO .i:i:2ii 9.75 13 .00 14.25 10.50 STATISTICS ON COTTONSEED AND COTTONSEED PRODUCTS UDited Statea--Texas August 1 to Ootober 31 August 1 to October 31 This season Last season This seasOD Last season Cottonseed received at mills 492,294 2,877,106 2,416,678 639,666 (tons) .. . . .. ...... . ... . .. . . 270,042 1,361,163 1,199,669 861,880 Cottonseed oruahed (tons) . . . . . CottoDseed OD hand Oct. 31 (toDS) ........ . .. .... .. . ... 249,446 1,607,871 1,347,438 828,145 Preduetion of ~reducls: 78,220 422,860 372,006 Crude oil (t ousaDd lba.) . . .. 104,028 695,791 622,419 Cake aDd meal (tons) ..... . . 156,486 122,150 Hulls (tons) . . ... .... ...... 68,441 329,718 302,623 87,902 Linte... (ruDDing bales) .. . ... 103,246 74,394 402,387 344,364 Stocks on hand October 31: Crude oil (thousaud Ihs.) .... 20,283 19,106 62,217 60,785 96,454 134,136 203,161 Cako and meal (tons) ... . .. . 63,085 Hulls (tons) . .. ...... ...... 88,330 92,309 74,043 2.3,862 124,424 37,121 42,039 100,601 Linte ... (ruDnung bales) . .. .. SOURCE: United States Bll108u of CeD8U8. DOMESTIC CONSUMPTION AND STOCKS OF COTTON-(Bales) September August 1 to October 31 October October 1942 .941 1942 This season Last acason Consumption at: Texas mills .. . .... .. .. . 21,904 19,893 21,669 63,780 6MU United States mills .... . 972,490 955,657 966,149 2,863,728 2,706,663 U.S. stocks-end of month: In consuming estabm'ta. 2,117,902 1,812,204 1,99a,505 0,724,038 Public stg. '" compre89es, 12,674,414 13,318,190 CRUDE OIL PRODUCTION-(Barrels) October. 1042 Increase or decrease in daily average production from Total Dailyavg. October, 1041 Sept., 1942 production production North Texaa ...... . ......... . 228,155 7,072,800 +12,915 + 6,080 6,422,000 West Texaa ... ....... .. .... .. 207,161 -69,076 4,4S3 Ea.t Texas . ...... .. ........ . 13,840,300 446,461 + 1,521 +20,755 168,190 -51,183 5,068,900 South Taxa.. ... . .. ..... ... .. + 2,340 9,631,000 310,678 Texas Coastal. .. . .. ...... . .. . +28,815 310 + Total Texas .... . .. North Louisiana .. .. ... . . . .. . . New Mexico . ...... . ....... .. 42,020,000 8,034,500 3,064,300 1,365,646 97,887 98,848 -82,008 +17,347 -16,797 Total district. . . •. . 48,128,800 1,552,380 - 81,458 SOURCE: Estimated from American Petroleum Inatitute wcekly rcporta. +33,318 436 + 1,676 +a4,658
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