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MONTHLY BUSINESS · REVI EW of the FEDERAL RESERVE BANK of Dallas ~~~======================================================================================~ ~~================================================================================N=o~.=7~ Volume 29 Dallas, Texas, September I, 1944 DISTRICT SUMMARY I' Consumer buying at department stores in this district dec ~ed by less than the usual seasonal amount from June to July a~ Was 12 per cent larger than that in July, 1943. Sales of furitture stores were in about the same volume as in July last year. eflecting the heavy demand for petroleum products for war ~~rp?ses, daily average production of crude petroleum in this . IStnct rose to a new peak in July and on the basis of allowables, Is ixpected to expand further in August and September. The late of construction contracts awarded declined further in u Y and Was at the lowest level of the current year. Lumber and T~ent production continued in smaller volume than a .yea.r al?o. d ~ hot, dry weather, which prevailed over much of this dlstnct . urtng July and the first half of August, caused a deterioration n growing crops and in livestock ranges. While scattered rains f aVe relieved the d~ought in some areas, general rains are needed ?r crops to permit preparation of soil for fall seeding operations, to revive ranges, and to replenish stock water supplies. h BUSINESS The dollar volume of sales at department stores during July Was 12 per cent above that of a year ago and showed a less than seasonal decline from that in the preceding month. On a daily ~verage basis, the adjusted index rose to 277 per cent of the .935-1939 average, thus superseding all other peaks in the adJUsted series since 1919. During the first seven months of this Year the dollar volume of sales exceeded that of the comparable period a year ago by 15 per cent. of Da~a available on sales by departments for the first six ~onths this year depict the type of transactions which contrtbuted gre~tly to this continued rise over those a year ago. During this period sales of women's and misses' clothing and ready-to-wear ~ccessories, which constituted approximately 45 per cent of the Otal sales volume reported, were 19 per cent above those for the sarne . d Iast year. ' ., d peno Reflecting the effects 0 f rattomng, t he f ernand for women's and children's shoes remained unchanged /orn a year ago. Sales of men's and boys' apparel during this alX-rnonth period were up 6 per cent over last year principally as thresult of the increase in the demand for furnishings. During p e same period, the demand for men's and boys' shoes and slipr::: ~ecreased considerably from that of a year ago. Despite the of hlcted manufacture of many durahle goods, aggregate sales tho ouse furnishings increased 10 per cent over last year. A~ a ugh sales of refrigerators, stoves and other household apphces decreased tremendously from the low volume of last year, as ~ de~and for items that were available in some quantity, such I llrnlture, domestic floor coverings, draperies, lamps, etc., was ge enough to counterbalance the decreases mentioned abo.ve. a reported increase of 45 per cent in sales of pictures, fram.mg f n mirrors during chis six-month period over a year ago IS a ~rther 'indication of the consumers' desire to add items of r auty to their households. Among small wares, sales increases Ianged from only 1 per cent for silverware to 77 per cent for aces, trimmings, embroideries and ribbons. An increase of 43 pe~ ~ent in the sales of stationery reflects to a great extent the '7lttng habit stimulated by the numerous separations as a result o War conditions. th thd The furniture outlook for the immediate future remains unfavoraple as a result of the recent lumber restrictions. Inventories at reporting furniture firms in July were 17 per cent lower than a year ago, whereas sales remained at approximately the same level as last year. AGRICULTURE Hot, dry weather prevailed in most sections of the Eleventh throughout July and the first two weeks of August. By mid-August, the shortage of moisture was critical in the north, west central and extreme southwest portions of Texas and was becoming serious in all other sections of the State except in the southern part of the High Plains and in some northwest and north central areas. The high temperatures and the lack of rain favored harvesting of wheat, hay and early feed crops but hindered the plowing of small grain fields in preparation for fallsowing, reduced prospects for corn, cotton, sorghum, late hay and sweet potatoes and held back range growth in most sections Harves~ing of early hay crops made go?d progress generally, and harvestmg of corn, peanuts and gram sorghums is active in southern counties of Texas. Recent rains in Louisiana have relieved droughty conditions and improved late crops. D~strict High temperatures and depleted soil moisture caused cotton to s~ffel' in n:ost of ~exas. and even though the crop was still holdmg up fairly well 10 spite of these conditions, growth of the late crop had almos~ scopped, and shedding caused by the high temperature was qwte general. Moisture conditions were more favorable on the South Plains and in the Cross Timbers area where the crop was making good growth and was fruiting well' but surface moisture was becoming scarce. All other areas of th~ State were in urgent need of moisture and cooler weather. Picking was well advanced in the southern portion of the State and had started in some south central counties, with pickers reported to be adequate in counties where picking had begun. Harvesting of wheat in Texas was practically completed by mid-August with production indicated at 77,071,000 bushels, 4,166,000 bus.hels above the July 1 forecast, reflecting better Yields than preVIOusly expected and weather conditions favorable for harvesting operations. The indicated yield per acre as estimated by the Department of Agriculture, was 18.5 bushels on August 1, as compared with 17.5 on July 1, 11.0 bushels in 1943, and the 10-year average of 9.7 bushels. 0: The Department of Agriculture reported that stocks of old wheat in Texas interior mills, elevato,rs and warehouses on July 1, 1944, were estimated at 240,000 bushels, as compared with 4,900,000 bushels a year ago, and the eight-year, 1935-1942 average of 1,280,000 bushels. Stocks stored on Texas farms wer~ estimated at 909,000 bushels, as compared with 5 218 000 bushels a year ago and the eight-year average of 574,000 bushels. The combined stocks of old wheat on farms and in interior mills, elevators and warehouses amounting to 1,149,000 bushels are the lowest since 1937 and only about 11 per cent of the 10,118,000 bushels reported on the same date a year ago. Total acreage planted to grain sorghums in Texas was estimated at 4,706,000, a record high, comparing with 4,357,000 acres last year, and the 10-year average of 2,208,000 acres. Har- This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) 2 MONTHLY BUSINESS REVIEW vesting of the grain sorghums was largely completed in the commercial areas of southern Texas early in August but was just starting in the Low Rolling Plains. Total production of grain sorghum was forecast at 82,355,000 bushels, as compared with 71,817,000 bushels last year and the 10-year average of 33,790,000 bushels, reflec ting both the larger acreage and higher yields. The indicated yield per acre is 17.5 bushels as compar~d with 16.5 bushels last year and the 10-year average of 14.6 bushels. Total acreage planted to peanuts was estimated at 770,000, which is a decline of 15 per cent from the 906,000 acres planted last year. The 1944 production of peanuts for picking and threshing was estimated at 308,000,000 pounds, as compared with 298,980,000 pounds last year and the 10-year average of 144,255,000 pounds. The yield per acre is indicated at 400 pounds, and compares with 330 pounds last year and the 10-year average of 470 pounds. The prospective pecan crop is indicated at 36,750,000 pounds, which is an increase of 41 per cent over the 26,000,000 pounds harvested last year, and the largest since 1940. While the recent heat wave has affected adversely prospective production over a considerable area, most areas still have a fair crop in sight. The corn crop is largely made, except in the High Plains areas. Although the hot, dry weather during July was tmfavorable for the crop in the heaviest corn producing sections, much of the crop had matured by July 1. The August 1 estimate of the Texas corn crop was placed at 64,649,000 bushels, which is 2,487,000 bushels below the July 1 estimate, approximately 27 per cent under the 1943 harvest of 88,416,000 bushels, and 10,920,000 bushels below the 10-year, 1933-1942, average production of 75,569,000 bushels. This year's yield was forecast at 13.0 bushels per acre, compared with 16.0 bushels in 1943 and the 10-year average of 15.3 bushels. Rice prospects declined during July and production is now forecast at 18,816,000 bushels, as compared with the estimate of 19,920,000 bushels a month ago, 20,196,000 bushels in 1943, and the 10-year average of 12,004,000 bushels. Broomcorn pro; duction is estimated at 8,900 tons, compared with only 2,700 tons last year and the 10-year average of 4,450 tons. The large production this year reflects the greatly increased acreage and the high per acre yield. Harvesting of the few remaining commercial truck crops has reached into the latest producing areas. Cantaloupes for the remainder of the season will come mainly from the Pecos section but watermelons of good quality are still available in volume. Harvesting of onions proceeded under favorable conditions in the Panhandle area with good yields and quality reported. Irish potato production was estimated on August 1 at 4,752,000 bushels, as compared with 6,450,000 bushels last year and the 10-year average of 3,516,000 bushels. Sweet potato production was forecast at 4,255,000 bushels, as compared with 5,616,000 bushels last year and the 10~year average of 4,332,000 bushels. During July, the condition of range feed and pasturage deteriorated more sharply than usual in most of the district due to excessive heat and lack of moisture. Range conditions are generally poor to fair in southern New Mexico and over most of Texas, with a shortage of stock water reported in many areas, although conditions in New Mexico were improved by July rains. In the Panhandle and High Plains area 'o f Texas, pasturage and range feeds were generally good as a result of more adequate moisture. Parts of the Low Rolling Plains and eastern Texas were improved by mid-July rains, but much of the area is still dry. Cattle in the Panhandle area are in generally good condition, but in many other sections they are either just holding up, or beginning to show shrinkage as a result of the continued dry, hot weather. The condition of sheep declined considerably during July due to the high temperatures and the deterioration 01 range foods over much of the sheep country. Receipts of livestock at the For t Worth and San AntoniO markets during July declined rather sharply from the record movements during May and June. Receipts of cattle, calves, hogs and sheep at the two markets during July totaled 694,800 head, which was 359,000 head less than in June, but 159,600 head more than in July last year. During the latter part of June CASH FARM INCOME- (Thousands of dollnrs) - - May 1944 Total reeoipt.s - - - J -Receipts from~ May May J anunry 1 to MaY 3 Crops Livestock· 1044 1043 1044 1943 Ariz.o~a................. 4,042 5,080 9,122 8,365 63,372 64,83 1 LcUlslDna..... . ..... . . ... 7,691 5,537 13,228 14,508 67,700 58,9~ New Mexioo... . ..... .... 374 4,941 5,3 15 5,040 24,338 30,09 Oklahoma........ . ...... 1,855 20,523 22,378 21,914 121,595 116,903 Tex....... ... ....... .. .. 22,034 01,520 84,163 78,308 390,210 304,04 6 Total . . . . . . . . . . . 36,590 97,610 134,206 129,044 - 667,323 664,826 · Ineludes receipts from the sale of livestock and livestock produots. SOURCE: United States Dopartment of Agriculture. LIVESTOCK RECEIPTS-(N umbor) - - -Fort Worth---~-- San Antonio---Jul y July June July July JunO 1944 1943 1944 1044 1943 1944 Cattie...... .... ... .. .. . . 97,679 65,432 105,840 27,760 14,763 30,75~i Calves .................. 37,500 24,646 32,082 23,584 17,606 10'9il rhoo'l,"p.'.'.'.' .' ::: :: :: : : : : : :: 3~g~g 2~6:~~~ 6~~:~~~ ~~:~~i 3N~~ ~~:OsD COMPARATIVE TOP LIVESTOCK PRIOES (Dollnrs per hundred weight) - -- Fort Worth July JUly 1944 1943 Beef steers ............. . . S15.50 $15.50 Stocker stcers . . .. . . . .... . 11.00 13 .50 Heifers and yearlings ..... 15 .50 15.25 Butcher oows . . ...... .. .. 11 .25 12.25 Calves . . . . ...... . ....... 13 .25 14 .00 14 .55 14.50 14.00 14.00 ~:b';.'::::::::::::::::: June 1044 $10.10 12 .85 16 .00 12.00 14.00 13 .05 14.75 July 1944 $13.75 .iil:oo 10.40 13 .00 14 .25 12 .00 San Antonio---July Juno 1044 1943 i14 .50 $13. 15 ' '' '(j) 14 '00 12 . 14.00 12.00 14.00 14 .25 13.00 14.10 13. 66 13.26 COTTONSEED AND COTTONSEED PRODUCTS - - --Texas United States---August 1 to JUly 31 August 1 to July 31 This season Last season This season Last seaBOD Cottonseed received nt mills (tons) ........... .. .. ..... . 940,668 1,054,064 3,983,513 4,516,087~ Cottonseed crusbed (tons) .... . 953,838 1,043,250 3,953,588 4,497,7 Cottonseed on hand July 31: (tons) .................... . 31,499 44,669 118,701 gO,386 Produotion of products: Crude oil (thousalld Ibs ) .... Cake alld meal (tons) .... . .. Hulls (tons) ....... .. ...... Linters (running bales) ... . .. 287,475 451,339 226,000 284,450 300,135 466,717 258,960 308,280 1,235,938 1,834,054 926,451 1,183,115 1,904,6 1,085,034 1,355,1 01 Stooks on hand July 31: Crude oil (thousand lb. ) . . .. Cake and meal (tons) . ..... . l:Iulls (tons) .. ............. Linters (running halos) . . . ... 1,964 8.860 3,342 17,917 1,357 5,678 2,321 42,807 8,847 27,776 14,677 63,059 18:5~~ 11,0 1,400'~f 6307 135,927 DOMESTIC CONSUMPTION AND STOCKS OF COTTON-(Bales) July Consumption at: 1944 TexllS mills... ........... 18,3 11 United States mills .... .. . 724,167 U. S. stooks-end of month: In consuming estah'ments. 1,873,187 Publio stg & comprosses.. 8,245,641 July 1043 24,319 830,868 June 1944 17,037 805,735 August 1 to July ~OD This sellSon Last 60 207,537 267,4~ 0,942,070 11,100,0 2,115,323 7,676,629 CROP PRODUCTION-(Thousands of units) ~-- TexllS--~- Eleventh Distriot/ Crop Winter wheat .. . ... ..... . Cotton ...... .... . .. .... . Corn ................... . Oats . .. . ...... . ........ . Barley . .............. . . . Tame bay ... . ........ . .. Potu toes, IriRh ... .. ..... . Potatoes, sweet ......... . Rice ......... . ......... . Unit Bushels Bales Bushels Bushels Bushels Tons Bushels Bushels Bushels Estimated Aug 1,1044 77,071 2,450 64,049 42,471 8,428 1,405 4,752 4,225 18,816 • Arizona, New Mexico, Oklahoma and Texas. only. ~Texas Estimated 1943 Aug 1,1944 36,360 78,111 2,823 3,117 88,410 74,806 21,780 47,978 3,341 17,811" 1,469 1,968 0,450 5,731 5,616 12,421 t 20,196 18,816 ~ tLcuisiana, Oklahoma and SOURCE: United States Department of Agrioulture . rOJas· MONTHLY BUSINESS REVIEW and July, a large percentage O'f the total movement was made ~P of sheep and spring lambs. Even though the number of breedIng ewes in Texas on July 1 this year was about 9 per cent srnaller than a year earlier, the Department of Agriculture rerOtted that the sharp increase in percentage lamb crop from 63 St year to 71 this year resulted in a lamb crop of 4,589,000 lead, which is about 2.5 per cent larger than for 1943 and is nly a'bout 3 per cent smaller than the record crop of 1941. The eXas lamb crop is the largest percentage of total western and total United States crops for any year of record. t r . Average prices received by Texas farmers in July on such (~~rns as corn, cottonseed, potatoes, wool, eggs and butter were s l?htly above those of the previous month. On the other hand, Prtces decreased moderately for small grains, meat animals, newcrop hay items, grain sorghmns, chickens, turkeys and old-crop peanuts; although the declines were relatively small, it is the Ncond consecutive month that lower levels have been reported. e~ertheless, prices for all commodities in these groups, except &ba1n sorghum, meat animals and chickens, are considerably a OVe levels obtaining at this time last year. FINANCE d' T~e gross demand and time deposits of member banks in this wtnct, which increased sharply during the period of the Fifth ar Loan Drive, averaged $3,905,000,000 during July. This ~~era~e, which represents a newall-time peak, was $247, 000.'Ju~ higher than t~at in June an.d $788,0 00'.000 a~ove that 111 Y last year. While the expansIOn of depOSits dUl'lng the past ~\vo months has been most pronounced at reserve city banks, it I as also been substantial at country banks. The volume of war n deposits at depositary banks in this district which reached ~'foW point of $127,200,000 shortly after the opening of the theth .War Loan Drive rose to a peak of $566,0 00 ,0 00 around a tnl~dle of July, but by August 15, the total had declined to pproxllTlately $5 00,000,00 0. J The reserve balances of member banks in this district during u~y averaged $540,121,000, which was approximately the same as In June, but about $63 300000 higher than in July last year. . ' , nunng the first half of August, reserve balances rose to a new pea~ of $58 0,26 2,000 and averaged $571,262, 000 for the brl~d, which was about $31,000,000 above the July average. urmg July w hen a large volume of customer deposits at banks ;as transferred to reserve-exempt war loan accounts i.'l payment Or Government securities, required reserves declinell. and average excess reserves rose approximately $17,0 00,000 tV the high~t leVel reached during the past year. During the first half of I ugust, the Treasury made substantial withdrawals from war ,can accounts and as the funds were disbursed, customer deposits ~ncreased bringing about a rise in required reserves of member banks. However, the reserve balances of member banks increased Y a greater amount than required reserves with the result that excess reserves . . l11creased further. b The circulation of Federal Reserve notes of this bank declined a OUt $9,000,00 0 between July 6 and July 26, which is considcrabl Yarger I . of the mont, h but 111. than usual at that penod ~cased rapidly thereafter and amounted to $480,900,000 on Ugust 15. This amm.mt was about $14, 000,000 higher than a rnonth earlier and $140,000,000 greater than a year ago. °i shaThe deposits of weekly reporting banks which had risen $l?ly between June 14 and Julyl2, increased further by about ,168,000 during the four weeks ended August 9. In the lat~er p~riod, Government deposits consisting mostly o,f war loan epOSIts declined nearly $40 000 000 but the expansion in other . ' , , dePOSits more than offset this decline. The increase of $12,100,- CONDITION OF THE FEDERAL RESERVE BANK (Thousands of dollars) August 15, August 15, 1043 1044 581,773 653,586 Totnl cas!. resorve., . , , . ................ , ........ . Nono 50 Disoo unts for member banks" . .... . ...... , ........ . Nono 18 Industrinladvanoes .... "., .. , , .. ,. ,., .... ....... . 527,000 231,620 United States Govomment securities, ...... , .. ..... . 527,000 231.688 Totnl cornin g assets, , .. , . , . , .. , . . . , . , , . , . , ...... . 493,908 574.808 Mombor bank reservo doposits, ..... , . , , , , . . . , . , .. . 480,906 340.898 Federal Reservo Notes in aotual oiroulation, ., .. . , .. . "Inoluding nonmember banks. July 15, 1944 56?J 497 . Nono None 523,985 523.985 540.403 466,945 CONDITION STATISTICS OF 33 MEMBER BANKS IN LEADING CITIES (Tbousands of dollars) August 9, August 11, July 12• 1944 1043 1944 Total loans and investmonts . . , ... , , . , . , .... , . , , , . . $1,564,807 $1.230.738 $1,546,048 Total loans.. .................................. 343,710 274.325 374.323 Commoroial, industrial, nnd a~ricu l turalloans.,. . 236.331 109,058 249,620 Loons to brokor. nnd dealers 10 soouritios" .. ,... 2,605 1,647 2877 Other loans for purohasing or carrying .eourities. . 41,013 13,626 56:178 Real estate loans .. , .. , . , ........ , ..... .... , . . 20,389 10,341 20,234 Lonns to blink........... , ... . , ...... , . , , , , . . . 421 132 211 All otber loans .... .... , .... ,.,., .... " .. , ·,·· 41.061 40.521 45,203 Total investmonts .... . . , ... , ... ··,·,,······,,·· 1,221,007 056.413 1,172.625 U, S. Treasury bills""." ... , .. , " ., .... ,.... 12n.652 114,476 102.849 U. S. 'I'reasury cortifioates of indobtodnCS9....... 352,482 230,605 332,685 U. S. 'rroasury notes .. , . .......... ,.,., ,...... 216,894 151,285 213,710 U. S. Govorament bonds, . . , ... ,., . ".,,·..... 460.334 351.004 457617 Obligations guaranteed by United Statos Gov't.. 20,620 54,406 21:703 Othcr seourities, , . ............... ... .. ....... 44.106 53,647 43.071 Rescrves with Federal Rcserve Bank ... .. . . ".,.,.,. 322,818 295.953 326.042 Bllianoes with domestio banks" . . ...... .. . , ., . . , .,. 228,578 238.782 231,004 Demand doposits-adjusted"... ................... 1,075.048 1.011.639 1,040.988 Timo doposlts......... .. .. ...... .......... ....... 190,378 147,159 186,590 310.220 130.080 349,989 United Statos Governmont doposits" . , .......•.. , , , Interbank deposits ... ...... ,",., ...... ,",·,',·,· 478.604 424.128 466515 Borrowings from Fedoral Reserve Bnnk, ... .... ..... Nono Nono Non. ~Tnolud es all domand doposit~ other than intorb~nk and United States Govornmont less cUllh Items reported as on hand or In proccss of collootlOn . ' DEBITS TO INDIVIDUAL ACCOUNTS (Tholls~nds of dollars) Potg ehango July July 1044 1043 over year Abilello ................. $ 17,289 15.240 +13 Amarillo.. .. .. .. .. .. .. .. 48.205 48.004 + 12 Austill. .............. ". 70.759 80,lI 8 - 12 Beaumont.. . ............ 56.739 53.761 + 6 Corpus Christi ....... . ". 53.162 41.015 +27 Corsicana ............ ". 6.449 6,135 + 5 Doll.................... 514.319 446.888 +15 EI Paso.. .. .. ... .. . ..... 52.246 53.298 - 2 Fort Worth ..... , ..•• , .. · 215.168 237.994 - to Galveston ..... ....... ". 45,986 89.010 +18 Houston"...... ..... .. .. 528,794 456.881 +16 Larcdo", , ...... ,. ...... 11.380 10.951 + 4 Lubboek .... ..... " ..... 23.943 20.558 +16 Monroe "., .. ,.......... 16.668 14.488 +15 Port Arthur, . . . .. . ... .. . 24,138 18.050 +27 Roswoll. ...... .......... 8,587 7,315 +17 San Angelo .. . ..... , . ... · 16,563 15,484 + 7 San Antonio .. , .. , .... ,.. 154,536 128,401 +20 Shroveport ...... "...... 72,879 64,554 +18 Texarkana".............. 18,940 15.058 +26 Tneson... .. ............ . 27,364 31.239 - 12 Tyler 22,460 18,488 +21 Waco:: :: :::::::: : :::::: 26.403 28.4 12 +13 Wichita Falls. .. .... .. ... 28.582 23,866 +20 June Pctg chango 1044 over month 10,602 - 12 44.632 + 8 08.450 -28 57,364 - 1 51,402 + 3 6,468 t 582.166 =12 59,888 -13 232.082 - 8 53,116 -18 597,248 -11 13.090 -18 26.700 -10 17.983 - 7 25.080 - 4 0.445 - 9 21.596 -23 163,518 - 5 83,064 -12 20,951 -10 30,239 -10 24,316 - 8 80,468 -13 32,652 -13 Total- 24 oities" ... , .... $2,061,454 $1.866,957 +10 $2,302,373 - 10 "Includes the figures of two banks in Texarkana, Arkansns, located in the Eighth Distriot tChango Icss tban onc-balf of one per cent. . GROSS DEMAND AND 'TIME DEPOSITS OF MEMBER BANKS (Average of daily figures-Thousands of dollars) Combined total Reservo oity bonks Country banks Gross demand 1042 ........ " ... $1,014,513 July July 1943 ............ · 2,874.871 Maroh 1044., .... ,., .. , · 3.320,227 April 1044 .......... ,,· 3.292,252 May 1044.. ...... . .... 3.275.467 Junc 1044 .. .. ..... ·· ,' 3,361,412 July 1944 ............. 3,601,462 Gross Gross Time domand Time domand Tim. $226.947 $1,005.607 $127,615 $ 818.006 $ 99,332 241.779 1,562,343 143,301 1.312.528 08.478 277,705 1.725,856 171.302 1.594,870 106,318 284.538 1,709,275 175,621 1,582,077 108,918 291.289 1.094.017 180.464 1,581.450 110.775 296,055 1.749,241 184.628 1,612.171 112,327 303.710 1,000.222 187,985 1,701.240 1J5,734 SAVINGS DEPOSITS July 31, 1044 Beaumont .... ..... ····· . Dallas, ...... .. · .. · .... , El Paso ...... .. .... · .. ·· Fort Worth ......... · .. · · Galveston ............... Houston .......... .... · .. Lubbook, ... , ........... Port Arthur .. . ..... , .... San Antonio, . .... .. . , ... Shreveport .. ........... . Waeo" .... ,· .. ,,··· .... Wichita Falls .. , ......... All other, .............. . Total ........... Number of roc:orting anks 3 8 2 3 4 10 2 2 5 3 3 3 68 100 Percentage ebBD~e in ,",vings deposits rom Number of Amount of July 31, savings savinll'l June 30, depOSIts 1943 depositors 1944 11,425 $ 5,537,680 +18.1 + 1.2 42,943.100 +36,2 101,560 + 2.0 13.1 36,438 +38,1 24,000 + 2.6 20.028.764 +31.0 35.048 + 1.8 14.627,688 +20,7 21,002 + 1.8 22 3 44.862.545 84,606 + 1.0 . 490.282 6.1 826 + ,0 3.704.548 +17.3 5.802 + .a 27.075,884 +27.7 31,080 + 2.2 10.472,141 +28.8 28,904 + 2.8 5,604,702 +18.2 8.198 + 1.4 3,732,706 + 5,5 0,815 + 1.0 83,440,314 +17.2 58.268 t +1.4 413,689 $231,755,751 +25.8 + 2.0 4 MONTHLY BUSINESS REVIEW 000 in interbank deposits reflected an extension of the rise that has been in progress since April. These deposits, which amounted to $478,600,000 on August 9, were at an all-time high level. During the four-week period, these banks made net withdrawals of $3,224,000 from their reserves with the Federal Reserve Bank and $2,521,000 from their balances with correspondents. The loans of reporting banks, which had risen $46,000,000 between June 14 and July 12, declined approximately $31,000,000 during the subsequent four weeks. During the Fifth War Loan Drive, the loans for security trading, representing mostly loans secured by Government securities, increased about $28,000,000. A considerable amount of these loans were made to purchasers of Goverrunent securities in anticipation of liquidation out of future income, but the decline of $14,300,000 in these loans during the four weeks following the close of the drive suggests that a substantial amount of the total represented speculative purchases for subsequent resale in the market or to banks. Commercial, industrial and agricultural loans declined $13,300,000 between July 12 and August 9, after having increased by $17,000,000 dunng the preceding four weeks. During the four weeks ended August 9, the reporting banks utilized the funds derived from the increase in deposits and the decline in loans to expand their holdings of Government securities. Total investments increased during the four weeks by $48,472,000 to a new peak of $1,221,000,000. The increase in holdings consisted chiefly of Treasury bills and certificates of indebtedness. During the drive when required reserves declined, some of the banks repurchased Treasury bills previously sold to the Federal Reserve Bank and in' addition made substantial purchases through subscriptions to weekly offerings, with the result that total hOldings on August 9 were at the highest level since July last year. During the past eight weeks, these banks have also added approximately $77,000,000 to their holdings of certificates of indebtedness. INDUSTRY The aggregate value of construction contracts awarded in the Eleventh Federal Reserve District during July amounted to $9,004,000, which was about 11 per cent below the figure for the previous month and approximately 38 per cent less than in July, 1943. The total value of awards for the first seven months of this year was $89,716,000, representing a decline of about 65 per cent from the aggregate of $259,448,000 for the same period in 1943. Even though there was a gain of approximately 13 per cent over the preceding month in the value of awards for residential construction, the volume was about one-third smaller than in July last year, and marked declines from the preceding month and the corresponding month last year occurred in all other types of construction. The demand for lumber in this district and in the United States increased considerably following the inauguration of the national defense program in 1940, reflecting the rising civilian requirements and the needs for lumber for military construction. Although lumber production rose steadily from 1939 through 1942, output was apparently insufficient to 11leet the civilian demand and the rapidly expanding military requirements. Since the early part of 1943, the situation has become increasingly critical, largely because 01 the decline in pro.;luction brought about by manpower shortages and the exceptionally heavy demands for war purposes. In the earlier years, the war demand consisted chiefly of lumber for construction purposes, but as the construction of military establishments and plant facilities were completed, increasing quantities of lumber were diverted to the crating and shipment of war materials abroad, Due to the continued exceptionally heavy direct and indirect requirements for lumber for war purposes, the War Production Board issued an order which became effective on August ,I, 1944, greatly restricting the use of lumber for non-essential purposes. Preference ratings will be given to home owners to assist them in obtaining lumber only in extreme emergencY cases, In general, damage caused to dwellings by fire, flood, tOrnado, earthquake, storm, 01' similar catastrophe is considered justification for emergency ratings when the damage is of such a nature as to make the dwelling unfit for continued occupancY' LUMBER PRODUCTION-TEXAS, ELEVENTH DISTRICT AND UNITED STA'fES (M illions of board feet) ~- Texas --~- Four Statcs' -~-U nited Sta1 09 -Month 1044 1913 1044 1043 1944 10 43 January ...... .... ...... . 72 1I5 161 230 2,480 2,2~~ February .............. .. 70 108 168 224 2,460 2'~67 March .. . ... ..... . ..... . m ~g ~:~l. ::::::::::::::::::: fJ;. is·t·.:: ::::: ::: :::::~: September .............. . Oeteber ..... ... ... . .. .. . November .. ......... .. . . December ..... ..... .... . Total- first five month) .. . 354 Year j~~ J 13 107 103 9S 93 101 08 80 62 June ......... , ......... . 106 585 842 Texa. 1,137 1,271 ),330 1,384 1,274 1030 ......... .. ........ . 1940 .... ....... . .... , .. . 1041. ........ .. .. ...... . 1~2 .. ........ ... . .. . .. . 1943 ....... .... ...... .. . m 244 237 242 226 205 210 214 183 1,185 N~~ ~:020 2,010 3,06 ' 3,1 10 3,141 3,233 3,040~ 3,0 2,9 7°8 2,64 -- 13,302 Four Stntcs2,399 2,580 2,719 2,88 1 2,711 13,463 United State.' 24,975 28,034 33,476 30,332 34,622 -ArizonR, Louisiana. New Mexico, and Toxus. SOURCES: War Prod uction Board, Bureau of Census, and United States Ilorest Service, CRUDE OIL PRODUCTION-(Darrela) July 1944 Inorellso or deoreaso in dailY nvernge produotion~ Total Daily "vg production production July 1013 JUliO1944 North TexllS ........ ... ,..... 7,476,050 241,163 + 13.411 _ 197 We.t Texa.... .. .. ... .. ...... 14,304,050 464,324 +210,643 +17'84~f EnstTexns" .... , .. .. . .. .... 15,877,450 512,176 + 15 412 + 6, South Texas ... , ... . . . . ".... 9,009,250 310,653 + 90:853 + 7,04~ Telns Coastal................ 16,478,050 531,550 +120,450 ~ Total Texas .. , . .. ' " New Mexico .. ... ... .. .. . . ... North Louisiana ...... .. . ..... 64,134,850 3,356,000 2,235,200 2,068,866 108,258 ~ +150,760 + 12,880 6,489 - 'Fotnl Distriot...... .. 60,726,050 2,249,227 +453,369 SOURCE: Estimated from American Petroleum Institute weekly reporte. +34,8~ 2= 1,~16 ___ +33,489 VALUE OF CONSTRUC'rION CONTRACTS AWARDED (Thousnnds of dollars) JUly .Tuly Jnne ,January 1 to JU~4:1 1044 J 048 1014 1914 1 48 Eleventh Distriot-total . . 0,004 14,4 12 10,080 81,716 250,4 48 Residential. ....... . ... 2,1 12 3,209 1,872 19,327 19 6~,'~ All o/,hor" ...... ...... 6,8112 11,113 8,217 70,389 United Stntcs--totnl ..... 190,589 183,66l 163,866 1,150,760 2,034,~~~ Residential. ....... . '" 25,813 71,836 30,622 220,705 1,~~~:971 All other"............ 164,726 111,825 133,244 921,055 -37 states cast of the Rocky Mountain. BOURCE: F . W. Dodge Corporation, BUILDI NG PERMITS poroontal' Percontage ehauge nne valuation fro m Jan 1 to July3 1, 1944 ha tion va 1un 9j3 Valuation July 1043 Ju ne 1944 No . VIIIuntion from I 5 $ 10,090 - 6 - 84 lPO $ 255,0:10 tl~o 100,102 +167 - 50 515 987, 124 + 113 83,310 - 21 +330 725 385,088 78 34,758 - 44 - 43 033 474,308 -';' 177,223 - 87 - 53 805 1,156,058 +218 400,131 - 25 - 27 4,407 5,419,591 + 107 20t,608 +260 010 903,081 49 + 15 225,874 1,611 - 50 2,000,314 - 10 + 28 64,370 - 78 - 20 585 560,199 :;: 8 781,487 + 11 5 1,747 - 65 5,604,730 +448 323,956 60S,4 11 3 +947 +220 036 3 1,846 427 +131 200,402 :;: 44 + 75 344,307 6,113 2,320, 130 +255 +41 + 7 268,558 +807 988 +269 665,473 +104 63,111 - 37 - 79 587 1,137,046 + 37 137,125 ___ 17,973 217 + 4 + 6 ° July 1944 Abilene. " ..... .. Amarillo . ..... . , . Austin .. " . ,. , ... Beaumont , , , , , ' " Corr,us Christi . ... Dalas .. .. .. , .... EI Paso ......... . Fort Worth .. , .. ,. Galveston , , .... , . HOllston .. " , .. , .. Lubbock ......... Port Arthur .... , . San Antonio .. ... , Shreveport . .. ... . Waco . . .. , . . .. ". Wichita Falls, , . , . No, 22 82 145 145 158 040 07 218 57 278 202 113 858 133 55 29 ----- Total" ..•. 3,232 $3,llO6,62~ -16 -35 ~J,486 $22,783,709 + 13 6 MONTHLY BUSINESS REVIEW season showed declines ranging from 3 per cent in the case of During July, crude oil production in this district reached a cake and meal to 13 per cent for hulls. Stocks of crude cottonnew peak for the third consecutive month, with a daily average seed oil, cake and meal and hulls on hand at mills on July 31 production of 2,249,227 barrels. This figure exceeded the June average by about 2 per cent and surpassed that for July, 1943, were subs tantially higher than the exceptionally low supplies a by about 25 per cent. The west Texas field continued to show year earlier, but stocks of cake and meal and hulls were lower the largest increase, with a daily average production of 17,500 than on the corresponding date of other recent years. End-of?arrels ahove that during the previous month. All other produc- season stocks of cottonseed oil have been at a very low level Ing areas in the district showed increases in production as com- since 1940 and current stocks are smaller than for most years pared with June, with the exception of north Texas and north- prior to 1940. Increased shipments of linters during the 1943ern Louisiana fields, where decreases in daily average output 1944 season and reduced production brought about a decline of occ.urred. Crude production outside this district~ however, re- 58 per cent in end-of-season stocks. lllal11ed at about the same level as in June and mcreased only WHOLESALE AND RETAIL TRADE STATISTICS slightly as compared with July a year ago. ~----Percentage change in : Stocks of above-ground crude oil declined slightly in the Stooks * Number Net sales of July 1944 from Jan 1 to July 1944 from Eleventh District during July and at the end of the month July June ropor ting July June July 31, 1944 trade: firms 1943 1944 from 1943 1943 1944 t~taled 120,605,000 barrels, as compared with t he 1943-1944 Retail Department stores: 49 +ll - 9 +15 + 3 + 6 Total 11th Dist . .. . 111gh of 127,165,000 barrels on February 19 this year and the 7 +12 - 14 +22 +13 + 9 Dallas .. . ....... .. 4 + 9 - 10 +12 +15 + 4 Fort Worth ....... . 1942-1 943 low of 92,678,000 barrels on January 10, 1942. +14 - 6 + 14 + 5 + 7 7 Houston ..... . .. · •. 5 + 8 - 8 + 9 -15 - t ~tocks of crude oil outside this district declined about 2 per cent San Antonio .....•. +14 - 7 +20 3 Shreveport . . ..... . 111 July and at the end of the month totaled 104,507,000 barrels, 23 +11 - 5 +11 Other cities . . ..... . as compared with 122,742,000 barrels a year earlier. Retail furniture: -1 - 15 -9 -2 66 Totnil i th Dist ... . -29 +10 +1 6 +8 Drilling activity throughout the United States, as measured Dallas ... . ...... .. -36 -4 -13 + 15 3 }!il Pano .. . .... ···· -20 by well completions, has increased materially for the third con+5 -5 10 +1 Houston .......... . -4 - 12 +2 4 +1 San Antonio ...... . secutive month and during July averaged more than 500 wells stores:· 1"3 pe.r v.: eek fo r the first time since early in 1942. In the E~eventh Independent -7 +2 +3 Arlzonn. . .. .. ..... u DIStnct, approximately 3,700 wells were completed durmg the .~ New Me<ieo....... 38'6' + 11 Oklahoma ..... . . . . - 6 +11 first seven months of 1944, as compared with 2,400 ~o.r t~e 'fexas.. .. .. .. .. .. . 072 same period a year earlier. The expansion of drilling activity ~n Whelesale trade:· -1 +34 Automotive supplies 6 +13 - 1 recent months has been brought about by an impr~vement 111 +22 +6 Drul!ll............. 6 - 1 + 1 +i i Eleotrical supplies. . 4 + 3 - 7 +" . 7' th.e supply of drilling rigs and equipment, the r.elaxlllg of cer+ii 26 - 6 - 11 Groeeries ... . .. , ., . +18 tam Government restrictions, increased wildcattmg and the reIInrdwaro......... 8 + 9 - 11 + 5 Surgioal equipment. 4 +16 - 12 +26 ~ently announced crude price subsidies for settled fields. DurTobacco & products 5 - 6 - 1 + 7 - 18 + 2 .Compiled by United States Bureau of Census (wholesale trade figures preliminary). In 9 the first seven months of this year 1,002 wildcat wells were *Stooks at cnd of month. tChnuge less thau one·half of one per cent. dnlled in the district but 78 per cent of these wells failed to produce oil in paying quantities. INDEXES OF DEPARTMENT STORE SALES AN D STOCKS July May Juno July Receipts of cottonseed at Texas cottonseed oil mills were ap1943 1944 1944 1944 proximately 11 per cent smaller during the 1943-1944 season Salcs(1035·1939 c 100): 228 160 203 202 th.an in the preceding season, but crushings of cottonseed deWithout sellsonal adjustment 220 228 245 277 With seasonal adjustment ... ... . .... .. . ... .. c1lned only about 9 per cent, In consequence, stocks 0 f cotton1 Stocks (1923-1925=100): 111 98 J09 115 seed at mills on July 31 this year were 30 per cent small~r oan Without seasonal adjustment ....... . 121 97 11 6 126 a year earlier. The output of cottonseed products dunng the With sensonal adjustment ... . . . .... . THE FIFTH WAR LOAN DRIVE .. ' L D ··ve come tax payments and, therefore, they will eventually result in n f 11 , a reduction of cash income tax revenues. Certificates of indebtAs 111 the case of the earher dnves, the Fifth War 1 ~ro~ed to be outstandingly successful. The grand tota 0 9sa es edness 1 Y4 per cent notes, 2 per cent Treasury bonds, and 2 Yz (url1~g the drive period aggregated $20,639,OO?'OOO'lor 2 p~r per c:nt Treasury bonds accounted for the remainder of the ~:nt ~l ex~ess of the $16,000,0?0,000 goal. ThiS tota wased~n - drive total. Sales of certificates of indebtedness were slightly less d ~ntlally 111 excess of ~hat realIzed frOI~ any of the prec 0 ~ than during the Fourth Drive, but sales of 2 ~ per cent bonds 01'!ves, ~he largest prevIous amount l:a"1I1g.been $18,94 4 ,00 , totaled somewhat more than in the preceding drive. No 2 per 00 wInch was realized from the Third Dnve. cent bonds or 1 Y4 per cent notes were offered during the Fourth In .an effort to minimize the expansion of ban~ deposits~ no Drive. Sales of securit!es to brokers and dealers were comparaseCUrities were offered to commercial banks durmg the Fifth tively small, aggregatmg only $533,000,000, or about $100,D~ive, a policy which had been followed in the preceding twO 000,000 over the Fourth Drive volume. dnves. The sale of Series E bonds to small investors aggregated Sales of the various types of securities during the Third, $3,036,000,000, or slightly over the assigned qu?ta .o~ $3,OOO'd Fourth and Fifth War Loan Drives are shown in the following 000,000. The sale of other types of securities to llldlviduais an table: Third Drive Fourth Drive Fifth Drive partnerships totaled $ 3,315,0 00,000, or 11 per cent more than (Millions of dollars) To non·bank invostol'!l: , 3,036 $ 3,187 the quota. Series E savings bonds . ... .. ..... .... .. .. . $ 2,.72 1,024 81 8 Sorie; F nnd 0 savings bonds. . . . .• . .. . . .. . 831 2,575 2,232 Sales of Series E, F, and G war savings bonds account~d for Tax nnd savin ~s notes .... .. ......... . .. " 2,483 4,770 6,036 Certificates of tndcbtedness. . . . . . . . • . . . . . . . q22 1,948 19 per cent of all sales during the drive, as compared ~Ith 1 ~ per oent notes. . . .. .. .. . . . .. .. .. .. . .. . . ... 5,220 2 por cent bonds ....... . ............. , .. . 6,257 ... . per cent for the Fourth Drive and about 16 per cent durmg t e 21« por cont bonds ......... .... ... ··· .. ·· 3,331 2}'j por cant bonds ............ , . .. .. .. .. . 3',779 I,P20 2',263 third Drive. However, sales of tax savings notes reac~ed a recTotol .......... ".. .. .. .. ... .. .. $18,044 $16,730 $20,639 ord high of $2,575,000,000, or 12 per cent of the drive tot~l, NOTE' Totols in tho above toblc do not include 1I00uritios sold ouwde tho drives to oorot?e great bulk of these notes going to corporations and assoc.la- mercial b~ks and to Governmont agenoies and tr ust funds. tlO ns. These notes will, of course, be used in making future m. °i r 6 MONTHLY BUSINESS REVIEW Both Texas and the Eleventh Federal Reserve District as a whole made an excellent showing in the Fifth War Loan Drive. Aggregate sales in Texas, which amounted to $613,000,000 were 132 per cent of the State quota of $464,000,000 and approximately 3 per cent of the national aggregate. This latter was about the same proportion of the national total as was provided during the Fourth Drive. An especially fine record was made in sales of Series E bonds. With a State quota of $125,000,000, actual sales amounted to $13 8,000,000, or 11 per cent over the quota. Of the ten large states with Series E quotas of $100,000,000 or more, this was easily the best record. In total sales of all securities to individuals and partnerships an even more impressive record was made, the State quota of $236,000,000 being exceeded by 34 per cent. The amounts of the various types of securities sold in Texas during the Fifth War Loan Drive and the percentage distribution of the sales in Texas and in the nation are presented in the following table. TexllS United States TYJ>e of issues: Series E savings bond......... . .............. . Series F and G savings bonds .... . ...... ...... . Tax .and saviu~s notes ....................... . Certificates of lIldebtcdllcss .... . ...... . . . ..... . 17i per ceut notes .......... . ...... . ......... . 2 pcr cent bonds .. . ...... . .... .. ............ . 2}1 pcr cent bonds . ... ............... . Alhount SI38.326,000 30,340,000 01,733,000 112, 181,000 59,305,000 140,746,000 30,001,000 Pcr Cent or Total 22.6 5.0 15 .0 IS.2 0.7 24.5 5.0 Totnl. ........... ...... . ....... ...... . $612,624,000 100.0 Per Cent or Total 14 .7 4.0 12 .5 23.1 0.4 25.3 11.0 100.0 The composition of the security sales during the drive in Texas differed considerably from that of the nation. In general, sales to individuals were proportionately heavier in Texas than for the country as a whole, whereas sales to non-banking corporations were lighter. This, of course, is to be expected as the larger corporations generally are located in the North and East. Series E sales accounted for 22 .6 per cent of the Texas aggregate, but only 14.7 per cent of the national total. The relative proportion of tax savings note sales was also higher in Texas than for the nation, in both cases about 10 per cent of these sales go' ing to individual accounts. On the other hand, the proportion of 2 per cent and 2 Yz per cent bond sales was substantially higher for the nation than for the State. Treasury security selling during June and July undoubtedlY constituted the most gigantic financing operation in history. In addition to the record-breaking total raised in the formal drive, the Treasury also sold a very large volume of securities outside the drive. Approximately $765,000,000 in long-term bonds was sold to commercial banks with savings accounts. Another $590,000,000 of bonds was placed in Government Treasurya c' counts, and $1,800,000,000 of Treasury bills was sold to banks and others over and above current maturities. The grand total of Treasury financing for the two months, therefore, really aggregated almost $23,800,000,000. COTTON AND COTTON TEXTILES Despite the fact that cotton is one of the most important cash cents, but a new 16-year high of 22.13 cents was reached in the crops grown in the United States, the total acreage planted to 10 spot markets on July 11, 1944, reflecting the effects of the cotton has shown a downward trend in recent years. Cotton provisions contained in the Stabilization Extension Act of 194~, planting reached a peak of 45,968,000 acres in 1925, but the which became effective on June 30. The most important proVl ' average acreage for the 10-year period, 1933-1942, was only sions of this act, reported by the Department of Agriculture as 28,189,000 acres. In 1943, the total had declined to 21,942,000 pertinent to cotton, are: (1) that the loan rate on cotton nOW acres and the estimate for 1944 was placed at 20,472,000 acres, and for at least two years after the war is raised to 92.5 per cent which is about 7 per cent below the previous year and represents of parity; (2) that each major cotton textile item be separately the smallest acreage planted to cotton in 49 years. Planting of considered in determining whether OPA ceiling prices ref1~ct special types has also declined. The total acreage planted to parity; (3) that in the establishment of ceiling prices, the pfl ce American-Egyptian cotton during 1944 is estimated at 14,000 of m~ddling 1's-inch cotton at the center of location shall be acres, as compared with 141,700 acres last year, and the acreage construed by OPA as equivalent to parity as is done by the Cojl1' planted to Sea Island cotton this year was negligible. modity Credit Corporation for loan· purposes; and (4) that the Cotton production in the United States reached a high of President shall take all lawful action to assure that the farm prO' 18,945,000 bales in 1937, brut the average for the 10-year period, ducer of all basic and proclamation commodities shall receive 1933-1942, was only 12,455,000 bales. The 1943 production not less than the minimum price at which ceilings could be was 11,427,000 bales and the forecast for 1944, made by the established by OP A. Department of Agriculture based on conditions prevailing on Since mid-July price declines ha ve offset recent gains and are August 1, is 11,022,000 bales, or about 12 per cent below the now at about the same levels as they were late in May. The facaverage production of the past ten years. tors contributing to the recent price decline appear to be the A record of 18,443,000 acres was planted to cotton in Texas current favorable war news, the continued good progress of the during 1925. However, for the 10-year period, 1933-1942, the cotton crop, and a further reduction in mill activity. average acreage had declined to 10,558,000 acres. The acreage The present outlook in the cotton textile industry, generally, planted in 1944, as reported by the Department of Agriculture, is one of continued labor shortages, further complicated by totaled 7,325,000 acres, or 7 per cent below the 7,915,000 acres worn machinery and inadequate carding equipment. Eve planted in 1943, and represents the lowest cotton acreage for the though the industry has expanded output, employment a~ State in 44 years. . wage payments since 1940, very little has been undertaken 11'1 A Texas cotton crop of 2,450,000 bales is forecast as of expanding or replacing equipment. The industry entered the August 1 this year by the Department of Agriculture, which war period with sufficient capacity to meet both Governm~l'It compares with 2,823,000 bales produced last year, and the average production of 3,273,000 bales for the 10-year period, 1933- and civilian requirements, for a short time, but since reachl~f 1942. The yield was forecast at 165 pounds per acre, as com- a production peak in September, 1942, the total output of mIl s pared with 174 pounds last year and the 10-year average of 162 has declined. Despite the continued efforts of several Gov~rll' pounds. The 1944 cotton crop for the Eleventh Federal Reserve ment agencies to bring about an increase in textile productJO~' District is estimated at 3,117,000 bales as compared with the the consumption of cotton in July declined to 724,000 bales, •t eSe lowest since September, 1940. As the Government requ lr 1943 production of 3,578,000 bales. Average prices for middling 15/16-inch cotton have fluctu- about 40 per cent of the total cotton textile output for the ",~r ated greatly since the yearly average peak of 35.4 cents was effort, acute shortages of many textile items are now being fe t reached in 1920. By 1932, the average price had declined to 5.7 by civilian consumers. To partially relieve tIus situation, the d 7 MONTHLY BUSINESS REVIEW sun.ption, were sufficient to cover requirements for less than \Val' Production Board issued an order on July 27, designed to three months. Stocks in public storage and at compresses totaled channel approximately 50,000,000 yards of cotton fabrics each 8,246,000 bales on July 31, as compared with 7,677,000 on the l:lend~r qU,arter into the p:rod':1c~i,on of m?derately-priced and same date last year. t-Pflced Items for essentIal CIVIlIan cloth1l1g. The cotton texThe expansion of the cotton textile industry in Texas has ~l e, yardage to be set aside in accordance with this order will be ehvered to apparel manufacturers and made up into garments been relatively small during the past 20 years, even though to ,be sold during the coming fall and winter seasons, However, Texas is the leading cotton producing state. The average numt~lS new order will give civilian consumers an additional supply ber of spindles in place at the cotton mills of Texas from Octoo goods equivalent to only about 2 per cent of the total annual ber 31, 1924 to June 30, 1944, increased by only 26,870, and the increase in active spindles for the same period has been only OUtput of 10,000,000,000 yards, 41,650. The Bureau of the Census reported that 239,136 cotton ,The Bureau of the Census reported that 23,281,000 cotton spindles were in place in Texas mills on June 30, 1944, and that SPIndles were in place in the United States on June 30,1944, and 233,988 were active during the month, showing an aggregate of OUt of this number, 22,373,000 were in operation during the 85,799,000 spindle hours with an average of 360 hours per nlonth, as compared with 22,412,000 for the preceding month spindle. and 22,769,000 for June, 1943. The aggregate number of The trend of cotton consumption in Texas mills has varied spindle hours reported for the month was 9,712,000,000, as considerably over a period of years. The average monthly con~olllpared with 10,060,000,000 during May and 10,714,000,000 sumption for the 10-year period, 1921-1930, was about 8,900 In. June, 1943. Based on an activity of 80 hours per week, bales, hut during the period 1931-1935 the average declined to ~flUdle activity du~ing June, 1944, was 118.5 per cent of, capac- 6,175 bales. The monthly average for the period 1936-1940 was as compared WIth 119.0 per cent in May and 130.0 111 June approximately 10,000 bales, but increased sharply during 1940o last year. Spindle activity for the season ended July 31, 1944, 1941 to 20,140 bales and reached a peak of 22,280 bales during averaged about 122 per cent of capacity as compared with 133 the 1942-1943 season. However, the monthly average for the }er cent in the 1942-1943 season and the peak of 139 attained in present season has declined to 17,300 bales. anuary, 1943. Cotton consumption during the 1943-1944 seaAverage mill margins which reached a low of 8.92 cents per son totaled 9,942,000 bales, as compared with 11,100,000 in the pre~eding season and the record high of 11,170,000 bales in the pound in 1932 averaged 12.7 6 c~nts per pound during the eight~eflod 1941-1942. The 10-year, 1931-1940, average was about year period, 1932-1940. Followmg marked expansion in activity, average mill margins increased sharply to 19.35 in 1941 and ,648,000 bales. reached a high of 21.14 in 1942. In 1943, the average margin Stocks of all kinds of cotton in consuming establishments declined to 20.19 cents and to 19.97 cents during the first five to~aled 1,873,000 bales on July 31, as compared with 2,115,000 months of 1944. a es on the same date last year and, at the present rate of con- I MONTHLY BUSINESS REVIEW SEPTEMBER 1, 1944 NATIONAL SUMMARY OF BUSINESS CONDITIONS (Compiled by tbe Board of Governors of the Federal Reserve System) ... - ......, INDUSTRIAL PRoDuonON .1I1tI ..... _ . _ .."'''' toO ZOO /' 2"" 220 240 "' / uo / 1/ 200 180 200 Ie. / 160 160 I 140 120 \ 100 eo 1937 v ) 140 / 120 100 / eo 193e 1939 1940 1941 1942 1943 1944 1. Federal Reserve index. Monthly figures, latest shown is for July, 1944. . OOST Of' UVIIIO ,,~ " .*- 1ft 180 " 011.' I ,--- 170 160 so 170 I 60 I ,t.,.;;:::::, 140 r '000).1 130 ~' 1"- ---.... '~--+ 90 110 40 I30 ~, ="~ I 120 AU.n ... 20 110 100 ......<J/ ' '"--' I r'-r IIIMT 100 90 - '------ eo eo 1937 1938 1939 1'940 1941 1942 1'943 1944 6. Bureau of Labor StatistIcs' Indexes. Last month in each calendar quarter through September, 1940, monthly thereafter. Mid-month figures. latest shown nrc for July. 1944. MEMBER BANKS IN LEADING CITIES 'IUAMI"OOI,~W 80 30r---1------r--- Y-I._-., '0 20r---~~~~~----_r--~_r----_+----~.0 ' 10 ISS 1940 1~1 1942 1M3 1944 8. Demand deposIts (adjusted) eXclude U. S. Government and Interbank deposits and collection items. Governm~nt securities include direct and guaranteed issues. Wedneeday figures. latest shown are for August 16. 1944. MEMBER BANK RESERVES AND RELATED ITEMS ""'_ ... MU..... z.' to I-----\- ;1,- - - --,20 15 ~'----r-- f+------1 10 -----.. -!'~~.......,... t~-=~~~~~~I~~~~~~T~~~~T~~~~~=-~ 0 1938 J!HO IMI 1142 tH3 Industrial production and employment declined slightly further in July. Wholesale commoditY prices generally continued to show little change, while the cost of living increased somewhat. 1M4 9. Wednesday figures. latest shown are for August 16. 1944. INDUSTRIAL PRODUCTION Output at factories and mines continued to decline slightly in July and the Board's seasonallY adjusted index was 233 per cent of the 1935-39 average as compared with 235 in June. The decrease in industrial production largely reflected small declines in a number of industr ies due to continued minor readjustments in the munitions program and to manpower shortages. Output of steel and of nonferrous metals declined further in July to levels respectively 8 pel cent and 20 per cent below the high levels of last autumn. A small decrease in activity in tranSpor. cation equipment industries reflected partly the indirect effects of manpower shortages .n foundrie! and continued readjustments in the shipbuilding and aircraft industries. In August a cutback io aircraft production was announced which was expected to result in the immediate release of 20,00 0 aircraft workers and the gradual release of 100,000 more du ring thc balancc of this year. Production of manufactured da.iry prod ucts and mCHS, after allowance for seasonal change, was maintained in July while outpu~ of other food products declined slightl y. Cotton consumption showed little change from the rate of the last two months. Activity in the rubber products industrY continued to decline slightly in July and su;plics of heav y truck and bus tires available for civilianS during the third quarter were substantially below estimated needs. Output of chemicals likewi¢ continued to decline slightly. Crude petroleum output and metal mining were maintained in large volume during July. coal production dropped 5 per cent from the level of the preceding month, but for the year thrOUgh August 12 was approximately 8 per cent above the corresponding period of last year, reflecting un' interrupted operations, longer working hours, and a great expansion of strip mining. So far this year the value of construction contracts award ed, as reported by the F. W. podge Corporation for 37 states, has fluctuated around 160 mi llion dollars a month--the lowest level since early 1935. DISTRIBUTION ' Department store salcs declined considerably less than is usual in .July, and have continued in August at a higher level than a year ago. • Freight carloadings continued to rise in July and were maintained at a high level during the first two weeks in August. There were considerable increases in shipments of grain, forcst produCts, and misccllaneous freight, offset partly by a slTlall decrease in coal shipments. AGRICULTURE Dry weather during July in the cast central area has reduced somewhat national prospectS fot corn, hay, and potatoes. Aggregate crop production, however, is likel y to exceed last year by 5 per cent, reflecting chiefly a record wheat crop 35 per cent larger than last year. Total production of all feed grains is estimated at 112 million tons compared with 115 rni!li~~ tons produced in 1943. While hay production, except in the drought areas, has been large, it wll provide a smaller supply per animal unit th an has been available in any of the last 6 yearS. Crop prospects for most fruits and vegetables, except potatoes, arc better than last year. TobacCO production is indicated as being abovc average and cotton yields may be good as dry weather haS held the boll weevil in check. BANK CREDIT In the fivc weeks following the close of the Fifth War Loan Drive, loans by banks for purchasing and carrying U. S. Government securities declined sharply; calls on war loan deposits and subsc<tuent Treasury expenditures increased adjusted demand deposits and consequently required reserves; the rapid outflow of currency into circulation was renewed; and exce5S reservcs declined. In the five weeks from July 12 through August 16 loans to brokers and dealers for purchasing Ps and carrying Government securities declined 500 million dollars to about the pre-drive level. Loa to others for purchasing and carrying Goverrunent securities declined about thc same amount, but are still considerably larger than before the drive. Commercial loans continued to show little chapge. Treasury war-loan balances at all depositories declined in the five-week period by 2.7 bill~~ dollars. At weekly reporting banks, Government deposits fell by 2.2 billion during the same perl se and adjuste4 dem:lrtd deposits increased by 1.4 billion s. Time deposits continued the stMdy inc rea that has been in progress for more than a year. J . rapiD Followi~g a slackened rate of outflow during the war Joan drive. currency renewed Its • he outflow and in the next few weeks increased at a rate of about 500 million dollars a month. f ha seS resulting drain on bank reserves and the increase in required reserves were met in pare by pure of Government securities by the Reserve Banks and in part by a decline in excess reserves. I Weekly average excess reserves of all member banks declined about 300 million dollars their peak during the war loan drive and amounted close to 1.1 billion dollars in mid_August. rate of decline was about the same at reserve city and at country banks. f:;e