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MONTHLY BUSINESS REVIEW
of

the

FEDERAL RESERVE

BAN K o f

=-

This copy is r eleased for publication in afternoon papel'S-

Dallas, Texas, February 1, 1941

Volume 25, No. 12

=

J

an. 3 1

BUSINESS
Augmented by a heavy Christmas trade, the dollar value of
merchandise sold at reporting department stores in the Eleventh
District during December was the highest for any month of
record, exceeding that in December, 1939, by 4 per cent. On
a seasonally adjusted basis, sales showed little change from the
high level attained in November. This bank's adjusted index
of sales averaged 116 per cent of the 1923-1925 average in
December, which compares with 117 per cent in November
and 113 per cent in the corresponding month a year earlier.
An increase in and a wider distribution of income resulting
from larger business earnings, higher fado. income and increased employment and payrolls in business and industry were
reflected in a further expansion in consumer buying in this
district during 1940. Virtually all branches of retail trade
experienced an increase in sales over those in 1939. Department
store trade at reporting establishments averaged 5 per cent
greater than in 1939 and the aggregate dollar value of sales
closely approximated that in 1929. Consumer purchases at
independent retail outlets other than department stores also
rose by about 5 per cent during the past year. In Texas the
6 per cent increase was fairly general among the 33 reporting
lines of trade, with the most outstanding expansion occurring
in the distribution of automobiles and automobile accessories.
It is significant, moreover, that the gain in sales over those in
1939 was widely distributed among rural as well as urban
centers. Sales at independent retail establishments in Oklahoma
and New Mexico during 1940 were about 2 per cent higher
than in the preceding year and in Arizona they were up 5 per
cent. In New Mexico, sales of nondurable goods, including
wearing apparel and foods, showed the most pronounced gain
over the year; whereas, in Oklahoma and Arizona the distribution of durable goods, such as motor vehicles, furniture,
and building materials, evidenced the largest increase as compared with 1939.
Department stores in this district continued to follow conservative inventory policies during 1940. Stocks at reporting
firms during 1940 averaged higher than those in 1939, but
the increase in stocks was smaller than that in sales with the
result that stocks were turned over at a slightly faster rate
in 1940 than in the preceding year. Although the value of
stocks at the end of 1940 was 3 per cent greater than a year
earlier, a portion of this gain may be accounted for by higher
retail prices, which, according to Fairchild Publications, were
2 per cent higher in December, 1940, than a year earlier.

NOTICE
On December 31, 1940, a Special Report was submitted to the Congress by the Board of Governors of
the Federal Reserve System, the Presidents of the Federal Reserve banks, and the Federal Advisory Council.
Copies of this report may be obtained from R. R.
Gilbert, President, Federal Reserve Bank of Dallas.
DISTRICT SUMMARY
Industrial production in the Eleventh Distric~ expan?ed
further in December and consumer purchases at retail estabhshIllents increased seasonally. Employment and payrolls continued
to expand as a result of the increased business activity and
higher industrial output. Distribution of merchandise through
reporting department stores was at an all-time peak in December and sales during the first half of January, 1941, were
Considerably higher than in the corresponding period last year.
December business at wholesale firms in six lines of trade
exceeded that of a year ago by 10 per cent. The value of conStruction contracts awarded during the past month was more
than double that in December, 1939, and exceeded the previous
record established in June, 1940, by 12 per cent. Petroleum
production decreased somewhat in December, but refinery
operations continued at the November rate, which exceeded
that in December last year by a wide margin. Total loans at
weekly reporting member banks increased further in December
and at the year-end they were $32,000,000 in excess of those
~ year earlier. The outlook for the agricultural and livestock
Industries continues favorable, with the moisture supply generaUy good throughout the district.
During 1940, industrial activity in this district ~howed a

~Urther increase, reflecting in a large measure the direct and

Indirect effects of the National Defense Program. Between the
Illiddle of June and the end of December, National Defense
Contracts totaling nearly $200,000,000 were awarded in Texas
and that total was augmented by awards in other sections of
the district. A large proportion of the total was for t.he c?n~truction of defense projects, such as army camps, shlpbulldtng yards, airports and air training bases, housing facilities and
Illa n ufacturing plants. This huge construction program has
created a heavy demand for various types of building materials
produced or fabricated in this district. Contracts have also
been awarded for a large variety of other products, the prodUCtion of which has greatly increased the operating schedules
0,£ ll1any manufacturing plants and in some instances has necesSltated the construction of additional plant facilities. The general Increase in ind ' 1 activity h as been accomparue d b y a
.
. .
ustna
rise in employment and payrolls and in business. Likewise, the
expansion of industrial production in the United States has
~csulted in a stronger demand for many commodities produced
In this district, particularly some agricultural and livestock
Pr.oducts. It should be noted, however, that the rise in industhrlal activity in tlus district has been unevenly distributed and
t at it has been accompanied by some unfavorable developIIIents, including a marked reduction in the foreign demand
f
Or Some agricultural commodities, especially cotton, and
SlllaUer exports of petroleum and petroleum products.

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This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

MONTHLY BUSINESS REVIEW
The rate of collections on accounts receivable at depart- cent, respectively, during the past year, which is indi~a:ive
ment stores in this district during 1940 showed little change of the continued expansion in business and industrial actlvlt~
from that recorded in each of the preceding four years. During On a seasonally adjusted basis, the number of persons employe
the past year collections averaged about 40 per cent monthly in non-agricultural businesses during December, 1940, was
on regular accounts and 15 per cent on instalment accounts. above that at any time since the speculative boom in 1937,
and payrolls were at the highest level in more than ten year
Reflecting the heavy demand at retail establishments during A large majority of the State's manufacturing trades repor: eh
the past year, the distribution of merchandise through whole- increases in both employment and payrolls during 1940, WIt
sale channels exceeded that of a year earlier by about 7 per the largest gains occurring at cotton textile mills and at tho~e
cent. Business at representative firms in eight lines of trade establishments producing food and forest products, m.en 5
was generally active throughout 1940 with unusually heavy work clothing, stone and clay products, and structural Iron
sales taking place toward the latter part of the year. This and steel. In non-manufacturing lines sizable increases occurr~d
development apparently reflects a heavier year-end trade than at wholesale and retail trade establishments, and at publIc
had been anticipated by retailers, thereby necessitating sub- utilities and power laundries. Employment at petroleum restantial fill-in orders to replenish depleted inventories. In fineries declined moderately over the year, but payrolls at the~e
comparison with 1939, the distribution of surgical equipment plants expanded by about 4 per cent. Preliminary reports in.d lwas the only reporting line of trade to experience a decline. cate that the number of workers employed in manufactu~mg
Sales of tobacco and tobacco products closely approximated and extractive industries and at trade and service establIshthose of a year ago, and the distribution of groceries and drugs, ments in Texas increased by more than 100,000 between
including liquors, averaged about 7 per cent higher than in January and December, 1940.
1939. The business of automotive supply firms expanded
The number of commer&ial failures in the Eleventh DistriCt
sharply and showed the most pronounced increase over 1939
was 3 per cent smaller in 1940 than in 1939, but liabilities
of any reporting line of trade. The distribution of other duradefaulting firms showed a further marked increase, the t.o.tal
ble goods, including electrical supplies, hardware, and machinbeing nearly twice that in 1939. The unfavorable liablh:y
ery, reflected increases over 1939, ranging from 3 to 10 per
record is accounted for by the default of two large industrial
cent.
concerns during the year. According to Dun and Bradstreet,
Following a substantial increase in 1939, employment and there were 313 failures in 1940 having an aggregate indebted
payrolls in Texas rose further by about 5 per cent and 10 per ness of $8,4 58,000 . The latter figure is the largest record~
in seven years, but is smaller than liabilities of commerCial
WHOLESALE AND RETAIL TRADE STATISTICS
failures during any of the fourteen years from 192 0 to 1933 ,
Percentage ohange in:
-Ratio Deo. oolleotions
Net sales
Stocks·
to acoounts outstand·
inclusive.
ing Dccember 1
r
Jan. 1 to
Dco., 1940 from :
Deo., 1940 from
AGRICULTURE
Nov., Deo. 31, 1940 Dec., Nov.,
Doo.,
Instal·
from 1939
1940
1939
1940
1939
Regular
Retail trade:
ment
Widespread rains in the Eleventh District during recent
Department stores:
weeks have provided good surface and subsoil seasons and
- 20
41
Total 11th Dist .. +4
+53
16
+5
+3
-21
44
17
Dallll8 .......... +3
+48
+5
+3
improved considerably the general outlook for the agricultu.r a1
8O
- 19
Fort Worth . . .. . . +7
35
18
+4
t
46
- 16
40
Houston .. . ...... +3
+5
+2
and livestock industries. In some areas, however, exceSSive
- 15
43
San Antonio ..... +9
+20
11
+41
+10
rainfall and high winds have caused considerable damage to
- 9
- 21
41
Othsr cities .. . . .. +2
19
+ 62
+1
Independent stores:t
growing crops and delayed the preparation of land for 1941
Amon . .. ....... + 1
+ 5
crops. Following a very slow start, due to poor moisture
New Mexico. . •.. + 5
. . ..
+ 2
+26
+ 3
Oklahoma.. .. ... + 7
conditions, the Texas wheat crop has shown a noticeable recoVTelll8.... .. ..... + 4
+30
+ 6
ery since last October, and the outlook is for a better-t~~n­
Wholesale trade:t
Maohinery, eqp't &
average crop in 1941. On December 1, 1940, the condlt!o~
au pplies (eleept
24
eleotrical).. .... . +12
- 18
+10
+10
+ 5
of wheat was placed by the Department of Agriculture at 6
Drug. (inol.liqu'rs) +12
+12
+ 8
+16
- 1
80
per cent of normal, which compares with an average of 4 7
111
Electrical supplies. + 8
+20
+ 3
87
Grocerie. .. ...... . +5
-7
+7
+5
- 5
per cent on that date last year and a 1928-1937 average
74
Hardware . ....... +21
- 13
+ 7
+ 6
- 5
93
Tob.ooo&prod's .. + 2
- 2
t
- 2 - 3
December 1 condition of 73 per cent, The conditiOn of t~e
·Stooks at olose of month. tLc88 than oO&-half of one par oont. tCompilod by United
crop has apparently improved further during the past .Sl~
States Buroau of Census.
weeks. The acreage seeded to winter wheat in Texas, whic
had been reduced sharply in 1938, is gradually returning to a
INDEXES OF DEPARTMENT STORE SALES AND STOCKS
(1923-25.verage = lOO)
more normal level. In 1939 the total acreage planted to wheit
With scll80nsl adjustment
Without sell80nal adjustment
was 8 per cent higher than a year earlier and seedings last fa ,
Sales-Doo.
Stooks- Deo.
Stocks-Dco.
Sales-Doo.
amounting to 4,360,000 acres, were 3 per cent higher than
1940
1939
1940
1939
1940
1939
1940
1939
in 1939 and only 6 per cent under the 1928-1937 aver~ge,
201
195
62
60
113
71
69
Total Eleventh Dist . . 116
72
127
69
208
204
63
61
Dallll8 .. . ...... ..... 130
The prospects for wheat production in Oklahoma have lIke130
73
73
248
229
60
60
Fort Worth ...... ... . 140
52
49
51
48
116
190
191
Bouston .... ........ 116
wise improved considerably over the past two months. .
107
63
50
178
167
44
San Antonio •....... . 115
56
Weather conditions during the latter part of December Id
COMMERCIAL FAILURES IN THE ELEVENTH DISTRICT
south Texas were unfavorable to commercial truck crops ad
(Liabilities in thousands of dollars)
citrus groves in that area. Excessive rainfall, strong win s
r - - -1940- - - v - -1930------v------1938------.
Numher Liabilities Number Liabilities Number Liabilities
and hail retarded the growth of crops, delayed harvesting oper23
$ 286
35
$ 754
25
S 217
January .. .. ....... . .... .
ations and caused considerable damage to some vegetable croPd
23
200
34
333
25
245
February .... . .. . ...... ..
22
167
85
368
19
305
Maroh ........ . . .. . .. .. .
particularly carrots, cauliflower, English peas, potatoes an
23
215
31
414
28
254
24
316
26
370
21
414
tf:~l::: : : : ::::: : : ::: :: ::
spinach, The indicated production of grapefruit and or~nges
18
166
30
265
15
160
June .... . . .. .. ...... .. ..
38
2,320
24
223
14
120
was likewise reduced, as a result of strong winds caU~!Ilg :
July ....... . .... ...... ..
34
384
23
340
19
197
August .. . . ..... .. .... . ..
substantial volume of fruit to fall from trees. It is signdicda n
23
159
22·
250·
16
203
September ... . . ... ...... .
as
720
23·
657·
2l
316
Ootober .. . ........ .. .. ..
to note, however, that despite the damage that occurre to
26
3, \45
24
293
36
a38
November .. . ..... . . . .. ..
truck and citrus crops during December, the indicated produl'
26
380
17
243
16
95
December . ...... .... ... .
tion of virtually all crops affected still compares favora~ 'f
Total. . ... .. n
....... 313 $8,458 324· U.419· 255 $2,873
with the final harvests in 1940. On January 1 the productlOll
·Revised.
2

d

°

d

:t

MONTHLY BUSINESS REVIEW
forecast for grapefruit and oranges was placed at 14,400,000
boxes and 2,850,000 boxes, respectively, which compares with
a 1940 harvest of 14,200,000 boxes of grapefruit and 2,360,000 boxes of oranges.
The condition of livestock ranges in the Eleventh District
showed less than the usual seasonal decline in December and
Continued above the average condition for that season of the
y~ar .. Heavy and frequent rains in the eastern portion of the
dlstnct caused a further deterioration in range feeds and preVented grazing on grain pastures. On the other hand, range
weeds and grasses in the western portion of the district are
making good growth and have furnished considerable grazing.
Prospects are favorable for early spring grasses throughout
mOst of the district. Although the prolonged period of wet
weather has caused some shrinkage in cattle weights, animals
afre ~till in good flesh and losses have been light. Supplemental
ceding has been resorted to in those areas where excessive
rainfall has caused extensive grass-rot. Sheep continue in better:han-average condition, and prospects are good for another
arge lamb crop in 1941.
Physical conditions were generally favorable to the agricultural and livestock industries in the Eleventh District during
1940. Per acre yields of virtually all major crops were above
the ten-year, 1929-1938, average, and in a majority of cases
they exceed the 1939 yields. Moreover, the production of most
crops was in excess of that in the preceding year and the tenCROP PRODUCTION- tin thousands of units)
,,---- - - Telns - - - - v - - Eleventh Distriot '----.,
1929·1988
1929·1938
Crop
Unit
1940
1039
average
1040
1980
average
Cotton .. . . ...... BaIes
3, u
28'
2, 6
84
3,876
4,863
Cotto
4,421
5,650
C nseed ..... . Tons
1,463
1.268
1.726
2,1 66
1,060
2,514
Whn . . ..... . . . .. Bushels 90,324
O
73,876
75,556 157,546 126,744
132,073
Oat at (all) . . . .. . Bushels 20,355
20,032
32,958
88,226
94,057
83,483
Il
Bushels 37,1 25
28,750
35.290
72.327
52.896
62.858
arr oy .. . . . .. " . Bushels
3.825
2.055
2,445
11 ,053
10.300
4.885
15.172
9.770
16,005t
15.172t
0,770t
G c~ ... . ........ Bushels 16.005
TralO sorghums .. Bushels 46,397
38,115
45,412
67,587
53, 148
62,163
W~~\hay....... Tons
1,341
1,022
745
3,510
2,930
2,487
ay
l'eanuts . . . . . . .. Tons
273
257
220
839
770
602
hi h ....... . . Pounds 166,675
129,480
77,449 204,055
151,190
00,750
S s Potatoes .. . . Bushels
3,200
2,666
3,343
8,786
7,716
9,071
S: eet potatoes ... Bushels
4,335
3,780
4,600
10,023
11,660
12,580
Or ee sorghums.. Tons
2,475
1,752
752
3,632
2,430
1,203
Granges .... " . .. Boxes
2,075
2,360
047
2,075t
2,360t
047t
l'e~s
fruit . . .... . Boxes
15.000
14,200
5,020
15,000t
14,200t
5,020t
..... . ... Pounds 41,000
19,000
24,470
66,604
36,104
41,262
fO t~ExcePt where otherwise indicated, Eleventh District figures represent the combined totals
r
Ok! he five states wholly or partially includod in the Eleventh District; i.e., Texas, Louisiana ,
tTexas only.
a oma, New Mexico, and Arizona.

f··· ·········

CASH FARM INCOME FROM THE SALE OF PRINCIPAL FARM PRODUCTS
AND GOVERNMENT BENEFIT PAYMENTS
(In thousands of dollars)
, . - - -October, 1040---.,
Receipts from:
Govern· ,r--- - - 'Total receipts
,
October Ootober
J an. 1 to Oct. 31
"---- - -----,, ment
Crops Livestock' payments
1040
1939
1040
1939
Arizon •
2,045
3,400
322
6,667
8,310
44,144
43,087
Lo " .. . .. ..
Ne~8Iana: .... . 12,725
2,090
2,271
17,086
24,103
86,538
98,780
11,605
177
13,887 ~ (10,148
41,032
37,522
Oklah~eXlco .. . 2,015
18,380
0,600
1,475
29,455
160,520
150,561
Texns .~~:: : : : 71,186 33,360 10,546 115,002 ~~. 23,446 466,781 440,236
76,083
Total. . .. . 107,251
60,145
14,701
182,187
142,000
700,865
'Includes receipts from the salo of livestook and livestook products.
SOURCE: Unitod Staton Department of Agrioulture.

LIVESTOCK RECEIPTS
(Number)
,,--- -Fort Worth- - - - v - - - - San Antonio----...
Deo.
DeD.
Nov.
Deo.
Dec.
Nov.
1040
1030
1940
1040
19aO
1940
42,181
34,062
47,108
12,720
12,401
16,066
27,565
23,440
42,722
23,304
21,212
25,555
58,867
31,600
35,504
13,500
18,149
13,650
28,738
26,867
44,654
4,209
3,701
4,446

(

r

780,045

COMPARATIVE TOP LIVESTOCK PRICES
(Dollars per hundredweight)
_____Fort Worth----v---- San Antonio----...
Dec.
Dec.
Nov.
Dec.
Dec.
Nov.
1040
1030
1940
1040
1080
1040
Ileef steers
$ 9.50
$10 .50
$11 .00
$ 0. 75
$ 0.00
StoCk
.. .. ....... .. .. $11 .00
0.75
8.50
0.75
7.50
7. 25
7.50
lleife:; :~dera
10.00
10.50
12.50
10.25
11 .00
Ilutoh
yearlings . ... . 12.00
Calve er oows . . ... . .. .. . .
6.75
6.75
6.50
6.50
5.50
6. 15
0.00
8.H
0.00
0.25
8.00
9.00
6.85
6.85
6.80
6.50
6.15
6.50
8. 75
8.00
9.00
8.00
8.00
8. 00

...:...... ,.

~:~:.:: : : : : : :: :::: :: :~

3

year average, the principal exceptions being the smaller-thanaverage harvests of wheat and cotton, the district's two principal cash crops, as a result of reduced acreages under Government allotment programs, However, production of wheat
closely approximated that in 1939 and the cotton harvest was
8 per cent greater. The cotton acreage harvested in Texas
during 1940 was about the same as that in 1939 but 4,060,000
acres less than the 1929-1938 average. Although the decline
from the average cotton acreage harvested was partially offset
by increases in the acreages of other crops harvested in Texas,
the total of 25,844,000 acres was still 2,500,000 acres less
than the ten-year average. Total acreage harvested during
1940 in states partially included in this district showed comparatively little deviation from that of a year earlier or the
ten-year average.
Prices received by Texas farmers for most of their farm
products during 1940 were lower than in the preceding year,
but the recession in prices was more than offset by the increased production. As a consequence, the total value of crop
production, which is estimated by the Department of Agriculture at about $367,000,000, was $48,500,000, or 15 per cent,
greater than in 1939. The significant feature of the expansion
in the value of crops produced in 1940 is that two-thirds of
the increase was in cash crops, which indicates that cash income
of farmers from the sale of agricultural commodities will
probably exceed the 1939 receipts from that source, which
amounted to $424,000,000 in the five states wholly or partially included in the Eleventh District. During the first ten
months of 1940, cash receipts from the sale of crops averaged
6 per cent higher than in the corresponding period of 1939.
The livestock industry in this district showed a further
growth during the past year. The 1940 calf crop was large
and the lamb crop exceeded the previous maximum by about
6 per cent. Production of wool was likewise at an all-time
peak. In Texas, average prices received for range animals during
the year were above those in 1939, and although shipments of
cattle and calves from this State were apparently somewhat
smaller than in the preceding year, due in part to a disposition
on the part of farmers and ranchmen to increase the stock of
animals on farms and ranches, marketings of sheep and lambs
exceeded those in 1939 by about 10 per cent, Prices of wool
and mohair were strengthened during 1940 by a heavy demand
created in part by Governmental purchases for defense purposes, and ranchmen are reported to have disposed of the
record growth at considerably higher prices than those obtaining in 1939. Cash income to farmers in the Eleventh District from the sale of livestock and livestock products during
1940 is expected to exceed the 1939 peak of $405,000,000 by
about 3 per cent.
Livestock prices have shown considerable strength in recent
weeks. Hog prices, which had declined by less than the usual
seasonal amount during the final quarter of 1940, increased
sharply on the Fort Worth market in the initial two weeks of
the new year and at mid-January they were at the highest
level since October, 1938. The seasonal advance last fall in
prices of slaughter steers has been well maintained, with some
grades of animals showing a further net gain in prices. Lamb
prices have followed a moderate upward trend over the past
few months.
FINANCE
Significant developments that occurred in the field of finance
in this district during 1940 include a further marked expansion in ballk loans and deposits, a continued rise in the volume
of funds for which there is no effective demand, an increase
in debits to individual accounts, and a subsantial gain in money
in circulation.
Following a seasonal contraction during the first half of

MONTHLY BUSINESS REVIEW

4

the year, total loans at weekly reporting member banks in this
district increased during the subsequent six months at a much
faster rate than is ordinarily the case in that period; as a
result, the margin of gain over the preceding year widened
gradually from month to month and amounted to $32,000,000
at the year-end. The expansion in loans during 1940 represented chiefly increased demand for funds from commerce,
industry and agriculture; however, personal and instalment
loans advanced somewhat and loans to brokers and dealers in
securities rose by about $2,000,000. Total loans of $319,000,000 on December 31, 1940, were the highest in ten years. In
contrast with the substantial net increase in loans, investments
of reporting banks showed noticeable variations during the
course of the year with respect to both the total amount of
securities held and the distribution of holdings among the various types of securities, but total holdings of $262,000,000 on
December 31, 1940, were only slightly larger than those at the
close of 1939. Over the past five years security holdings at
reporting banks in this district have fluctuated mostly between
$250,000,000 and $300,000,000; whereas, investments at reporting banks in 101 leading cities of the United States
increased about $3,148,000,000 during that period. Over twothirds of the latter gain was at New York City banks, where
the volume of funds redeposited by interior banks has shown a
marked increase during the past few years. Despite the small
increase in investments at reporting banks in this district during 1940, total loans and investments at the year-end were at
an all-time peak, amounting to slightly more than $580,000,000 and exceeding the total at the end of 1939 by

rate than in the preceding year. A peak of nearly $90,000,000
was reached during the first half of July, and while a net
decline of $6,000,000 occurred in daily average excess reserves
during the remainder of the year, a substantial portion of this
CONDITION OF THE FEDERAL RESERVE BANK
(In tbousandB of dollan)
Jan . 15,
Jan. 15,
19U
1940
$256,177
Total cash reserves . ..... . .. .. . . . . ......... . ..... . $297,081
4
12
Disoounts for member banks ....... . ... . .. ... ... . . .
18
151
Other bills disoounted . . ...... ... . .. . .. .. . . .. .... . .
278
487
Industrial advances .. ... .... . . .. . . .... . . . ...... . . .
86,835
94,302
United States Government securities . .. . . . . .. .... . . .
87,143
95,004
Total earning assets . . .. . . .. ........ . . . .. .. ..... . .
244,118
222,741
Member bank reserve depcsits ...... . ... .. . ... .. .. .
81,386
95,119
Federal Reserve notes in actual circulation . . .. .. . .. .

CONDITION STATISTICS OF MEMBER BANKS IN LEADING CITIES
(In tboueands of dollars)
Jan . 8,
Jan. 10,
Dec. 11,
1941
1040
1040
Totallonns and investments. . . . . . . . . . . . . . . . . . . . . . . $582,364
$548,172
$580,037
Total loans . ... ..... . .............. .. . .. .. ..... ..
315,695
288,065
308,053
Commereial, industrial and agricultural loans . .....
216,133
188,170
209,133
Open markct paper . . .... . . . .... . . . .. . . ... ... . ..
1,517
1,740
1,611
LOans to brokers and dealers in securities . . . . . . . . . .
5,033
8,033
4,004
Other loans for purcbasing or carrying securities. ...
12,640
14,145
13,337
Real estate loans. . .. . ...... .. . . . . . . .... . ..... . .
23,208
22,410
23,833

Xl\a~:h~ ~ann~:"", ::::::::::: : :: : ~:: :::: :: :: : ::

MEMBER

BANKS

IN

El.CVENTH r eOtR AL AU t RY!

LEADING

56,~~i

54,m
153,132
171,245
53,590
41,087
57,479
58,152
138,522
145,840
261,903
277,(92
450,404
519,015
137,122
135,264
82,680
25,479
270,059
274,807
None
None
States Government, Isss

GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS
(Avorage of daily figures-in thousands cf dollars)
Combined total
Resorve city banks
Country banks~

CITIES

DISTRICT

..,a.UONS 01 OOl1.ARS

Gross
demand

"""
'100 I-+----I----+

50,~~~

United States Government direct obligations. . .. .. ...
167,218
Obligations fully guaranteed by United Stntes Govt . .
40,423
Other Becurities . ....... . ..... . .. . ... . .. . .........
50,028
Reserves with Federal Reserve Bank. .. . . .. .. .. . . . . .
149,204
Balances with domestic banks . ... . . . . . .. . . . . . . . . . . .
282,598
Demand deposito-adjusted".. . . . ... ... ... ... . .. ..
520,377
Time deposIts . . .. . . . . .... .. . ... . ... ... ..... . .. . ..
135,936
United States Government deposits . .. . . . . . . . . .• . . ..
20,000
Interbank deposits ..... .. . . . . . . . . . . . . . . . . . . . . . . . . .
279,592
Borrowings from Federal Reserve Bank. " . . . . . . . . . .
None
"Includes all demand deposits other than interbank and United
oasb items reported as on hand or in process of ccllection.

$33,100,000.
REPORTING

Deo.15,
19(0
$294,542
17
28
82
84,923
85,050
242,800
95,257

- - - - J - - - + - - - I - - - +- -__i 700

1--f---_t---+-~--i---::r--''---t_--+----i ClOO

",c= =----j---'-+- ---i >oo

Deeember,
December,
August,
September,
October,
November,
December,

1938 .. .. ... . .. $1,180,070
1939 . . . ....... 1,3 44,386
1940 .. . . .. . , . . 1,315,554
1040 . .. . ..... . 1,346,840
1940 . . . . . . .. .. 1,408,515
1040 .. . . .... .. 1,409,805
1040 ... . ... .. . 1,474,217

~I-~~~_t---+-----J------_r------t_----_r---__i~

200
'00

':'-U.""V

.LL1..........

Deposits at all member banks in this district showed a
further pronounced rise during 1940. The expansion represented chiefly increases in adjusted demand deposits, which
include principally individual, corporate and municipal deposits. The daily average of combined gross demand and time
deposits recorded new highs in each of the final three months
of 1940 and the average of $1,712,000,000 in December was
$133,000,000 greater than in the closing month of 1939.
Since January, 1936, daily average deposits at member banks
in this district have risen by nearly $600,000,000.
As a result of the sharp expansion in deposits at member
banks during 1940, which exceeded the increase in loans and
investments, banks made substantial additions to their reserves
at the Federal Reserve Bank and also increased their balances
with other domestic commercial banks. The expansion in reserve balances was especially pronounced during the final
quarter of the year, when daily average reserves registered
new highs in each succeeding month. Moreover, the trend continued upward during the first two weeks of the new year;
on January 15, 1941, reserves totaled $244,000,000, which
was a newall-time peak. Excess reserves of member banks in
this district likewise increased during 1940, though at a slower

Abilene .... . . .. .
Austin.. ........
Beaumont. . .... .
Coraioana . . . . .. .
Dallas . . .. . .. . . .
E\ Paso... . .....
Fort Worth. . . .. .
Galveston . .. .. ..
Houston .........
Port Arthur . . . . .
Roswell. . .... ...
San Antonio . .. . .

~~~~~rf.c:,r:.:. . :::

Tueson .. .. .. ... .
Tyalcor...... ... ...... . . .
e
W.
Wiehita Falls. . ..

Time
$223,336
234,145
234,123
233,023
233,323
233,412
237,308

Gross
demand
665,072
777,031
708,031
783,742
814,555
842,570
841,903

Groes
demand
524,508
560,455
547,523
502,604
503,000
627,319
632,314

Time
123,655
130,290
128,003
128,161
128,295
128,213
131,622

Time
$ 99,081
103,846
105,100
104,862
105,028
105,199
105,680

DEBITS TO INDIVIDUAL ACCOUNTS
(In tboueands of dollars)
Petg. ehange from
Total year
December 'December November:
, potg.ohango
1940
1030
1940
1940
1080
from 1989
$ 10,130
+ 2. 1
+ 1.5
105,389
102,845
+ 2.5
43,050
+ 9.5
+31.3
419,459
410,405
+ 2.~
28,285
+ 5.8
+ 3.7
291,177
278,706
+ 4. 7
4,171
- 1.2
+17.5
42,032
39,780
+ 5.
334,728
+ 2.6
+19 .0
3,160,201
2,992,039
+ 5.6
50,595
+41.0
+18 .9
386,009
340,032
+10.6
109,502
+ 4.0
+24.7
1,004,297
973,830
+ 3.1
32,932
+10.9
-14 .4
334,689
302,210
+10. 7
292,038
+ 3.3
+ 8.0
2,998,003
2,729,307
+ 9.~
10,005
- 1.1
+ 5 .7
116,235
109,301
+ 6. 0
5,744
+ 1.9
- 18 .5
57,501
52,816
+ 8.
84,077
+ 7.1
+ 9.3
880,588
830,718
+ 6.7

5~:m +~:~ :j:~~J

13,120
13,215
10,207
17,521

------

- .3
- 3.0
- 3.0
- 2. 0

+ 1.4
+ 0.0
+10.3
.4

5~~:t~~

147,188
141,516
170,054
200.027

5~~::~~ :j:U

139,359
137,473
106,227
174,836

------ ------

+ 5.~
+ 2' 8
+ 2.
+14.4

-----

Total. ... . $1,130,377
+ 4. 0
+13.0 $11,096,263 110,400,230
+ 0.7
"Includes the figures of two banks in Texarkana, Arkansas, located in tbe Eigbth District.

Beaument .... . . ........ .
Dallas . .. ........ . ......
EI Paso . .... . ... . .......
Fort Worth ..............
Galveston ........ .. .....
Houston ......... .. ......
Port Artbur . ......... . ..
San Antonio .............
Shrevepert ....... .. . ... .
Waco .. . . . ... . . .........
Wicbita Falls ...•... • ....
All otbers . .. .•.. .. ... . ..
Total. ....... .. .

SAVINGS DEPOSITS
December 31, 1940
Percentage ehanfe in
---., eavings deposits ~
Number of Number of Amount of ,
Nov.30,
Dce.31,
savings
savin~s
re~rting
1040
depoSits
1989
depositors
anks
+ 2.6
10,038 $ 4,243,106 + 8.2
S
+ .8
90,825
20,025,933
8
.3
+ 2.6
8,515,778 + .4
2
18,002
+ .8
35,221
13,121,803 - 1.1
3
_ .1
4
18,456
12,167,580 + .3
+ \.2
32,194,350 + 3 .0
76,238
10
+ .6
5,770
3,302,757 + 6.1
2
+ 1.0
18,134,227
22,069
.3
5
+ .4
12,253,034 + 2.7
24,998
a
_ 4.5
4,404,100 - 7.5
8,115
3
_ .02
7,048
3,648,437 - a.o
3
31,049,378 + 3.0
50,758
00
+ .1

-

-

115

378,33.

Sl69,661,392

-+ 1.3

+

.8

MONTHLY BUSINESS REVIEW
Contraction was offset during the first half of January, when
tOtal reserve balances showed a much greater increase than
required reserves. Balances with correspondent banks in the
United States averaged $488,000,000 during the first half of
December, 1940, which was $13,000,000 greater than a year
earlier.
MEMBER

BANK

RESERVES

tL[VCHTH rtDfI\AL. RtxRVt

DISTRICT

j-----r-----t-----t-----t-----t-----t-----t-----1~

j-----r-----t-----t-----t-----t-~~~~~t-----1 200

7m1-----l

'0

Federal Reserves notes of this bank in actual circulation
showed a seasonal decline during the first five months of 1940,
reaching the low point of the year at $78,028,000 on May 24.
During the remainder of the year, however, note circulation
Shhi?Wed the largest gain in several years, with the result that
t s bank's circulation reached an all-time peak at $98,400,000
On December 23. This figure was about $12,300,000 above the
tnaximum circulation in 1939. The rise in the latter part of
t~e year, which reflected in part seasonal factors, was intensified by the expansion in business and industry and shipments
of Currency to army camps.
Total earning assets of the Federal Reserve Bank of Dallas
were reduced further by $7,900,000 during the year ended
J~nuary 15, 1941. This decline represented chiefly a contraction in holdings of United States Government securities, and
rhflects this bank's proportionate share of a net liquidation in
t he.System's investment account. Discounts for member banks,
w lch were completely liquidated early in 1940, showed a
gradual upward trend until August 23, when total bills disc~unted amounted to $877,000. Loans to member banks declllled seasonally during the remainder of the year, however,
and totaled only $12,000 on December 31, 1940.
h Debits to individual accounts at banks in eighteen cities of
~ e Eleventh District increased seasonally in December to the
bghest level of record for that month, and the total was only
~ OUt 4 per cent under the all-time peak recorded in October,
b929 , when charges to depositors' accounts were augmented
1~ a heavy volume of security transactions. During the year
40, total debits averaged 7 per cent higher than in 1939,
and the increase was well distributed among cities from which
reports are obtained.
INDUSTRY

(

e Thhe value of construction contracts awarded in the Elev$~t District during December amounted to approximately
r 2,500,000, which was the largest total for any month of
/c ord . The figure reflects primarily sharply increased awards
r
the construction of National Defense and United States
r ~Using Authority projects. The value of awards for nonteSI~ential building, which amounted to about one-half of the
nOta, showed the most pronounced gain during the month;
al~ve~theless, contracts let for residential building were at an
b -tune peak and nearly three times the value of awards in
ecetnber, 1939.

IB

5

The awards for National Defense projects also had a marked
effect upon construction activity for the year 1940. The total
value of new projects initiated during the year amounted to
about $271,000,000, which was 4 per cent greater than the
previous maximum recorded in 1926 and nearly 40 per cent
higher than in 1939. Although publicly-financed construction
accounted for the major portion of the expansion over 1939,
privately-financed building increased about 13 per cent, reflecting chiefly a substantial gain in contracts awarded for
the erection of non-residential buildings. Publicly-financed
construction during 1940 was nearly double that of a year
ago, the gain extending to each of the several classes of construction work.
Among the principal classes of building initiated during the
past year, marked gains occurred in the construction of nonresidential building and of engineering projects, the latter
classification including public works and public utilities construction. The value of contracts awarded for engineering
projects was about 45 per cent greater than in 1939, reflecting
increased awards for streets and highways, dams and reservoirs,
water supply systems, railroads and airports. The value of
non-residential building during 1940 was nearly 60 per cent
larger than in 1939. This expansion was accounted for largely
by increases in the construction of aircraft hangers, manufacturing buildings, and facilities at various army camps. In the
residential field the number of projects upon which awards
were let and the total floor space made available upon completion of the structures were approximately 25 per cent greater
than in 1939; whereas, the value of all residential contracts
awarded during the year was only 16 per cent greater than
VALUE OF CONSTRUCTION CONTRACTS AWARDED
(In thousand. of dollars)
December Deoember Noveml>or
Jan. 1 to
1040
1930
1040
1040
Eleventh Distriet-total. .42.516
17,603
22,500
271,487
Residential ..... .. .. . eo
13,037
4,762
7,636
07,014
All other ..... ..... "....
29,470
12,841
14,864
174.473
United Statea· - total. ... '.
456,1 89
354,008
380,347
4.003,957
Residential. .. .. ... .. ..
159,275
88,681
152,838
1,506,944
206,014
265,417
227,500
All other . . .. .. ..... .. ".
2,407,013
·37 stotea east of the Rocky Mountains.
SOURCE: F. W. Dodge Corporation.

Deo. 31
1939
100,110
83,43~

115.676
3,550,543
1,334,272
2,216.271

BUILDING PERMITS
Peroentage change
Peroentaga
valuation from Jan. 1 to Deo. 31, 1940 obanse
v
valuatIon
No. Valuation v Deo.,1039 Nov.,1040 No.
Valuation from 10aQ
44$
74,855 +340 .8 +100 .0
311 $ 676,209
+17.1
244,614 +128.9 + 47 .5
54
883 2,504,179
-1.5
646,754 +134.4 - 12.3
100
2,878 7,363,000
+ 2. 6
117
83,361
2.4 - 48.0
1,645 1,540,020
-10 . 2
160
247,070 + 38 .6 - 12 .0 2,393 8.002,630
+22.7
510 2,059,276 +375 .0 +331.0 7,727 16,220,813
26 3
.
134,050 - 16 .8 + 1.6 1,001 3,057,179
106
18.8
142
186,681 - 53.7 - 54 .2 2,050 4,850,672
-aU
121
40,054 - 61.8 - 82 .3 1,741 2,086,560
+45.3
260 3,155,628 + 62 .7 +191.2
5,537 24,253,888
- 4.4
126
40,852 - 28.6 - 30.4
2,308 1,127,851
- 1.4
442
004,055 + 05.7 - 58. 0 7,562 9,340,558
+10 .0
84
220,607 - 18 .1 - 40.0
2,018 4,816,403
- 17.0
27
80,867 + 41.1 - 21.3
837 2,562,082
+71 .3
32 1,047,176 +207 .6
545 2,345,402
t
+ 83 .1
Deoomber. 1940

Abilene . .... .. .
Amarillo .... ...
Austin .. ... ....
Beaumont . . . . . .
Corr,us Christi . .
Dal as· . . ......
E\ Paso .. . . . . . .
Fort Worth . ....
Galveston .. . ...
HOllston ... .... .
Port Arthur .. ..
San Antonio ... .
Shrevoport . . . . .
Waco ... . ... ...
Wiohita Falls . ..

-

t

------ -----

------ - -

Total. . ... .. 2,343 SlO,075,800 +100.7 + 50.4 40.435 190,928,514
+U
·Inoludes Highland Park and Univorsity Park.
tInoreaao over 1,000 per oentl

PORTLAND CEMENT STATISTICS-TEXAS MILLS
(In thousands of barrols)
Produotion
Shipmonts
Stooks (end of montb)
1040
445
477
580
713
758
672
528
574
631
743
648
602

1030
673
571
400
720
772
537
667
485
685
704
478
547

1940
450
533
678
600
712
594
538
505
645
784
563
592

1039
628
545
607
665
686
644
535
582
585
568
554
518

.... .. . 7,376

7.888

7.383

7,207

January ..... ............ .
Fobruary .. . ... .... . .. . . .
Maroh . .. .. .. ..... .......

¥nit·:::::,::·::::::: ::::

July . . "' .... ...... . .... ... . .
August .... .. ...... .. ... .
September . ... ..... . .....
OOtober ... .. . ..... . . . .. .
November .... ... . .... . . .
Deoember . . .. ......... . ...
Totol. .....

v

1940
906
850
762
775
821
808
883
862
848
807
882
802

1939
826
852
655
700
705
688
820
722
822
058
882
911

,

MONTHLY BUSINESS REVIEW

6

in 1939. There was a marked decline in the value of apartment houses erected during the year, but this recession was
more than offset by increases in the value of dormitories, onefamily dwellings and army barracks. The construction of onefamily dwellings that were placed on the "for sale" or "for
rent" markets expanded sharply due in part to the construction of additional slum-clearance projects under the United
States Housing Authority. Reports indicate that residential
building costs in this district rose somewhat during 1940,
reflecting the increased demand for building materials and
labor as a result of defense activities.
The valuation of permits issued for building projects within
the corporate limits of fifteen principal cities in the Eleventh
District increased further in 1940 to the highest level for any
year since 1929, the total exceeding that in the preceding year
by 5 per cent. The value of permits issued at nine of the
reporting cities showed a gain over 1939, with the largest
increases being recorded for Dallas, Galveston, Waco, Corpus
Christi, and Wichita Falls. Although the value of permits
issued at Houston during 1940 was moderately smaller than
in 1939, the aggregate for that city accounted for more than
one-fourth of the total value of permits issued at all reporting
cities.

CONSTRUCTION
ELEVENTH
MILLIONS Of DOLLARS
4()

30

CONTRACTS AWARDED

FEDERAl..

RESERVE

DISTRICT
MILLIONS

or

I-+-I-+- I -~--~--~--~--~--~--~--~~--

OOI..L "RS
4()

-

~

20

Reflecting the expansion in building activities during 1940
the demand for lumber and cement was heavy, resulting in
the maintenance of operations at mills producing those products at a comparatively high level. At Portland cement mills
in Texas, production during the year closely approximated
the record output in 1929 and shipments were moderately
higher than the previous record movement established in 1939.
Activity at lumber mills in this district was very irregular
during the first half of 1940, with production and shipments
averaging somewhat lower than in the corresponding period
of 1939. In the second half of the year, however, operations
increased noticeably due in part to the acceleration of demand
for lumber incident to the National Defense Program. For the
year as a whole, output of lumber was about the same as that
in 1939, and shipments were 5 per cent greater. Mill stocks
of lumber were reduced sharply during 1940.
Daily average output of crude oil in the Eleventh District
was curtailed further in December and was 13 per cent below
that of a year ago; as a result of this contraction, petroleum
production in the United States was fractionally smaller than
in November and 5 per cent lower than in December, 1939.
Refinery operations both in this district and in the nation as a
whole showed little change over the month, but continued at a
somewhat higher level than a year ago.
Outstanding developments in the petroleum industry during
1940 include a further expansion in the production and refining of crude oil, increased drilling activity, a record demand

for refined products, increased imports of crude petroleum and

refin~d products, and a sharp curtailment of exports. Produc-

tion of crude oil and refining operations in the United States
were at an all-time peak and drilling activity was at the
highest rate since 1937. In the Eleventh District operations
were above those in 1939, but the rate of increase was much
smaller than that elsewhere in the United States due principally to the resumption of more normal operations in Kansas,
where activity had been curtailed sharply in 1939, and to the
rapid development of fields in southern Louisiana, Indian~,
Mississippi and Illinois. The expansion in imports of crude 011
and refined products into the United States during 1940,
reflected chiefly increased takings of crude petroleum from
Mexico and higher imports of residual fuel oil from Venezuela.
Above-ground stocks of crude petroleum increased sharplY
during the first six months of 1940, but since the beginnmg
of July inventories have shown little net change, reflecting
close alignment between the amount of petroleum produce
and the amount utilized.

d

Notwithstanding a sha;p contraction during 1940 in shi Pments to foreign countries, total demand for the refine d
products of petroleum was at an all-time high, exceeding the
previous maximum recorded in 1939 by about 2 per c~nt.
Exports declined about 30 per cent due chiefly to the clOSIng
of European markets by military operations, but the increas:d
demand in this country more than offset the contraction ,0
foreign buying. The domestic demand for virtually all productS
was greater than in 1939, with pronounced increases occurring in the consumption of kerosene, heating and distilla;e
fuels and wax. Although a record consumption of gasoline ,n
the United States during the past year aided in reducing gas oline inventories, which had mounted sharply during the winter
of 1939-1940, stocks are still heavy, being near the record
high for this season of the year. The demand for residual fuel
oils during 1940 was about 5 per cent higher than in the preceding year, reflecting the marked expansion in industrial production that occurred during the year.
The existence of heavy inventories of gasoline throughout
1940 had a depressing effect upon the market of that pro~uct
with the result that prices declined to the lowest level sm ce
1933. Prices of lubricants, which had increased considerably
in the latter part of 1939, also declined in 1940 due largelY
to the contraction in foreign demand. Posted prices for crude
oil showed little change during the past ye;lr; nevertheless,
the market was weak at ·times and reports indicate that some
Mid-Continent crude moved at less-than-posted prices.
Following a curtailment in the preceding two years, drilling
activity in the Eleventh District, as measured by the numbed
of wells completed, increased 6 per cent during 1940, an I
completions in the United States rose 11 per cent to a leye
only moderately below the peak recorded in 1937.
Domestic consumption of raw cotton in the United States
continued in record proportions during December. In contra.ji
with a seasonal decline that is usual in December, cotton JTl.I
activity was stepped up further during that month of
the volume of cotton consumed totaling 775,500 bales, whll
was 19 per cent greater than in December, 1939, and on Y
fractionally below the all-time peak of 777,000 bales
sumed in March, 1937. The Board of Governors' season a Y
adjusted index of cotton consumption increased to 145 Pdr
cent of the 1935-1939 average in December, which ex~ee s
the previous peak established in November, 1940, by 10 pOInts.
The output of cotton products during December was apparently well in excess of incoming orders; nevertheless, the
backlog of unfilled orders remained in large volume, and a~ter
the turn of the year, there was a resumption of heavy buyUlg·

191°h

cOit

MONTHLY BUSINESS REVIEW
Prices of cotton goods have continued generally firm, with
quOtations on some constructions showing a further advance.
During 1940 consumption of cotton in the United States
Was at a high rate; the total of cotton consumed during the
twelve months amounted to more than 8,000,000 bales, which
exceeds that for any calendar year of record. During the early
months of the year, the rate of activity declined substantially
from the high level prevailing in the latter part of 1939,
but operations were expanded rapidly in the last half of the
year when heavy Government buying of cotton goods for
defense purposes coincided with an increased demand from
commercial sources.
Operations at cotton textile mills in Texas, which had been

~airly active during the first half of 1940, increased sharply

I~ the final six months of the year, when the strong commer-

C demand for products was augmented by heavy Governial
mental purchases. The volume of cotton consumed during 1940
~as the highest in recent years, exceeding the amount utilized
ill 1939 by nearly 35 per cent. Although the expansion in
te~tile mill activity in Texas during the latter half of 1940
cOillcided with the increase at all such mills in the United
States, the gain over 1939 for the country as a whole was
mUch smaller than that at Texas mills.
. In addition to the expanded operations in the cotton textile
iIldUstry during 1940, the production of rayon in the United
States established a new high and output of woolen materials
whas especially heavy during the final quarter of the year when
t e Government placed large orders for wool clothing for
armed forces.
Cotton textile mills continued to make heavy purchases of
r~w Cotton during December. Stocks on hand at the close of
t e year were 9 per cent greater than a month earlier and
~nly 2 per cent less than on December 31 , 1939. Based on the
ecember, 1940, rate of consumption, mill stocks of cotton
on Dec~mber 31 were equivalent to about two and one-third
months' operations. At the close of 1940, stocks of cotton in
public storage and compresses, the major portion of which
represents Government loan stocks, were 3 per cent higher
than on December 31, 1939.

(
1

In Contrast with the prevailing high rate of cotton mill
~Ctivity in the United States, foreign consumption of cotton
I~ at a comparatively low level, due chiefly to military operatiOns and the loss of export markets. The Department of AgriJUlture reports that operating schedules at cotton mills in
~pan have been reduced sharply in an effort to bring production in line with sales, which are relatively small because of a
Phor foreign demand. Operations at textile mills in most of
t e Countries of Continental Europe have been curtailed due
apparently to their inability to obtain raw cotton, and while
actiVity at English mills has been fairly well sustained, cotton
c~nsumption is somewhat smaller than a year ago. As a result
o the curtailment in operations at foreign cotton mills together with increased competition from South American
COUntries for the accessible world markets for raw cotton,
eXpOrts of American cotton have been in small volume for
;everal months. Shipments during December amounted to only
07,400 bales and the . total for the first five months of the
C
. Urrent season aggregated only about 600,000 bales, which
IS 80 per cent smaller than exports in the corresponding period
o.f the preceding season and the smallest for any similar period
Since 1873.

7

Foreign exports of cotton from the ports of Houston and
Galveston during the first five months of the 1940-1941 season
amounted to only 262,000 bales, or about one-seventh of those
in the corresponding period of the preceding season. Tlus decrease was larger than that in total exports from the United
States and reflects the small shipments to the Far East and
the transportation difficulties in making direct shipments to
Great Britain. The sharp reduction in foreign shipments of
cotton from these ports has been offset in part by a 15 per
cent increase in coastwise shipments; nevertheless, total movements through these ports during the five months ended December 31 were at a lower level than in any corresponding
period for which data are available.
CRUDE OIL PRODUCTION-(Barrels)
December, 1040
Increase or decrease in daily
average produotion from
Dailyavg. ,
Total
Dec., 1030
Nov., 1940
production
produotion
181,923
+ 12,812 + 5,253
5,030,600
North Texas ........... ..... .
- 48,409
-11,722
236,506
7,331,700
West Texa.................. .
- 115,007
-13,822
432,200
East Texa................. .. 13,401,000
-13,352
- 30,360
187,416
5,800,000
South Texas . . . ..... . ...... ..
- 11,612
234,444
- 1,528
7,267,750
Texas Coastal ......... .... .. .
Total Texas ........ .
New Mexico ................ .
North Leuisiana ............. .

30,440,950
3,141,300
2,125,550

1,272,579
101,332
68,566

-201,666
- 7,784
810

Total Distriot.. ...... 44,716,800
1,442,477
-210,260
SOURCE: Estimated from American Petroleum Instituto weekly reports.

-35,171
244
+ 1,818

+

-33,100

STATISTICS ON COTTONSEED AND COTTONSEED PRODUCTS
~--Texas---v--United States----...
August 1 to Deoember 31
A¥gust 1 to Deoember 31
This season
Last season
ThiS season
Last season
Cottonseed received at mills
3,581,713
3,553,182
823,372
024,078
(tons) ..... .. ..... . ... .. ...
2,310,080
2,536,034
653,008
662,826
Cottonseed crushed (tons) .....
Cottonseed on hand Dec. 31
1,165,405
1,275,709
224,472
277,659
(tons) .................. . ..
Produotion of produots:
780,468,443
737,717,158
188,241,761
Crude oil (pounds) ......... 200,000,847
1,030,026
1,137,074
300,062
308,645
Cako and moal (tons) ... . ...
643,644
576,780
171,486
160,079
Hulls (tons) ....... . .......
611,415
628,750
148,701
161,145
Linters (running bales) .... . .
Stooks on hand Deo. 31:
66,721,343
93,183,310
10,670,961
Crude oil (pounds) ......... 30,167,591
175,700
219,412
70,320
61,085
Cako and meal (tOilS) . ......
172, 170
167,626
71,633
84,436
Hulls (tons) ...............
225,396
344,349
112,459
67,905
Lint~rs (runlling bales) .. ....
SOURCE: Bureau of Census.
COTTON
1040
January .... ... .. 12,827
February ........ 11,451
Maroh ...... .... 10,507
10,700
~ril .. ....... ...
ay ...... ...... 12,309
Juno ..... . ...... 10,759
July .... . . . . ... , 12,407

CONSUMPTION
1038
1030
10,378 8,737
0,785 8,064
10,961 10,551
0,240 0,356
11,182 10,622
10,355 10,248
0,182 10,731

AT TEXAS MILLS-Bales
1040
August .......... 15,213
Soptomber ... .. .. 16,206
Ootober . . ... . ... 15,772
November . .. .. . . 20,583
Deoomber ... . .. . 22,408

1080
11,062
11,115
12,149
12,800
11,049

1988
11,529
10,878
10,092
0,887
8,001

------

Total. ...... 171,322 120,258 120,586

CONSUMPTION, STOCKS AND EXPORTS OF COTTON-(B.los)
Deoember December November Au~ust 1 to December 31
ThiS season Last seoson
1940
1939
1940
Consumption at:
90,182
20,583
58,175
11,040
22,408
Texas mills ....... . ... ·
3,584,017
3,310,143
744,088
650,123
775,472
Unitod States mills . .. ..
U.S. stocke-cnd of month:
1,682,278
1,861,406
In oonsuming estab'mts. 1,833,864
Publio stg. & oompresses. 15,046,513 14,570,390 14,727,234
EX-lfurts from U. S. to:
51,850
307,650
053,508
162,873
10,564
niled Kingdom .. . . ...
None
None
300,364
67,451
None
Franoo . . ... . .... ····· .
None
243,201
None
08,761
None
Italy ........ ".........
None
18,992
None
None
None
Germany ..............
143,368
44,878
708,608
169,825
42,120
Other Europo ........ . .
20,716
422,171
2,787
123,932
8,865
122,031
45,105
478,481
188,878
i~r~~h~~ ·oou·~t~iCs·.·. '. : : : 36,817
602,765
3,134,415
144,710
806,720
107,375
Total exports . . ....
RECEIPTS, EXPORTS, AND STOCKS OF COTTON AT THE PORTS OF
HOUSTON AND GALVESTON-(Bales)
Dooember Deoember November Au Rust 1 to Deoember 31
This season Last season
1040
10a9
1940
1,384,367
2,737,165
320,064
403,567
105,360
Receipts ............... ..
526,342
1,809,432
131,441
460,310
08,013
Exports . . .............. .
1,895,820
1,762,336
Stooke, end of month .... . 1,966,926

MONTHLY BUSINESS REVIEW
I

I

FEBRUARY 1,1941

NATIONAL SUMMARY OF BUSINESS CONDITIONS
(Compiled by the Board of Governors of the Federal Reserve System)

INDUSTRIAL PRODUCTION

---, 140
~

ptR CENT

140
130
120

100

/J

90
80

70

\
\
\

I

110

IV

/

k/

)

J

I

tl-

01M1

130
120

110
100

v

90

,I

so
70

60

60
1934

1935

1936

1937

1938

1939

1940

Index of physical volume of production, adjusted
for seasonal variation, 1985-1989 average
100.
By months, January, 1934 to December, 1940.

=

DEPARTMENT STORE SALES AND STOCKS
PER can

PER c£HT
II 0

I 10

100
SA LES/,

0
80

70

./"\.IV
.......-....,.

60

rv

V

~

J

\,fi IV

_1"
...

I 00

90

so

S10CICS - - - ' \

'--

---./ --_/

,~'

r..,,"'

70

60

50

50

40

40
1934

'935

1
936

.938

1937

BILLIONS

A

4

~V

---

r---..

'''-.,./ ~

or

DOL LAR;

L

4

1935

1936

1937

1938

1939

1940

MONEY RATES IN NEW YORK CITY
4

Textile production, which in November had exceeded the previous record levels reached a yca r
ago, continued at this high rate in December, not showing the usual seasonal decrease. At cotton and
rayon mills, activity increased somewhat further and at wool textile mills output was sustained at
peak rates. In the shoe industry, where output had been in reduced volume during the first ten
months of the year, there was less than the usual seasonal decline in November and December and,
on a seasonally adjusted basis, production was close to earlier peak levels.
At mines bituminous coal production declined less than seasonally and anthracite production
increased. Output of crude petroleum showed a reduction in December owing mainly to the factI
that wells in Texas were closed for ten days as compared with nine days in November. Output 0
metals continued in large volume.

Distribution of commodities to consumers increased more than seasonally in December. Depatt~
ment and variety store sales showed the customary sharp expansion during the Christmas seaso~
and sales at mail-order houses rose more than is usual at this time of year.
Freight-car loadings showed a seasonal decline from November to December. Shipments of forest
products and miscellaneous freight decreased less than seasonally, while ore loadings, which had been
unusually large in November, declined sharply.
WHOLESALE COMMODITY PRICES

U. S. Department of Commerce estimates of the
amount of income payments to individuals, adjusted for seasonal va riation. By months,
January, 1984 to December, 1940.

fl£Jt C( N1'

Automobile production declined somewhat more than seasonally in December following an
unusually large volume of output in November and October. Retail sales of new cars during the
last quarter of 1940 were about one-fourth greater chan in the corresponding period last year a~d
used car sales also were large. In the nonferrous metals industries activity increased further In
December and output of lumber and cement showed less than the usual seasonal decline.

6

r

3
1934

""til

DISTRIBUTION

PAYMENTS

BILUONS OF DOt. l MI;$

6

Volume of industrial production showed little change from November to December, although
usually there is a decline at this season, and consequently the Board's adjusted index rose further by
four points to 136 per cent of the 1935-39 avccage. Steel ingOt production was sustained at about
96 per cent of capacity. New orders for steel continued large, according to trade reports, and
were equal to or slightly greater than production; consequently the volume of unfilled 0~dcr5
remained at about the peak level reached in November. In the first half of January steel output jncreased to around 98 per cent of capacity. Activity in the machinery, aircraft, and shipbuilding
industries continued to increase sharply and working forces were expanded further. In these lin.es
and in some others, such as wool textiles, unfilled orders are oxceptionally large, owing in the
to the defense program.

Value of construction contract awards, as reported by the F. W. Dodge Corporation, increased
contraseasonally in December, reflecting further sharp increases in awards for defense construction
and private nonresidential building. Contracts for private residential building declined by somewhat
less than the usual seasonal amount.

=

7

PRODUCTION

1940

1939

Indexes of value of sales and stocks, adjus'ted
for seasonal variation, 1923-1925 average
100.
By months, January, 1934 to December, 1940.
INCOME

Industrial actIvIty continued at a high rate in December and the first half of January and
distribution of commodities to consumers was maintained in large volume. There was some incre;1.lC
in wholesale commodity prices.

pt A GtHT

4

Basic commodity prices generally increased from the middle of December to the middle 01
January, following little change during the preceding fou~ weeks. Currently these prices are sub'
stantially above the level prevailing last summer. Increases in the past month were most marked {or
foodstuffs, especially hogs, pork, lard, and cottonseed oil, but there were advances also in a nurnb~
of industrial materials, particularly pig iron, cotton, cotton goods, paint materials, and hides. s~e
CS
scrap prices, after increasing during most of the period, subsequently declined and lumber pClC
also decreased somewhat from the sharply advanced peak reached in November.
BANK CREDIT
Total loans and investments at reporting member banks in 101 leading cities continued to in'
crease substantially during the six weeks ending January 8, reflecting principally increases in holdingS
of United States Government obligations at New York City banks. Commercial loans tO~e
somewhat further while loans to New York security brokers and dealers, which had increased I~
December, subsequently declined somewhat.
Excess reserves, after declining during the first half of December, have since increased to
about $6,900,000,000. The increase reflected reductions in Treasury deposits with the Reser~e
Banks, a continued inflow of gold, and since Christmas a seasonal return flow of currency frofll
circulation.
UNITED STATES GOVERNMENT SECURITY PRICES

Prices of United States Government securities reacted somewhat after reaching record ~ig~
o levels early in December. Bonds of 1960-65 showed on January 8 a net decline of about 2% pOlni
o
1935
1939
1 40
9
1934
1935
1936
'9~7
from the all-time peak of December 10 but subsequently fluctuated somewhat above this le'le~
For weeks ending January 6, 1984 to January The yield on this issue, which was 2.03 per cent at the peak in prices, was 2.16 per cent 0
11, 1941.
January 14.