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MONGJrHLG)(

RBVIBW
FEDERAL
Vol. 38, No.9

RESERVE

BANK

o

F

DALLAS
September I, 1953

DALLAS, TEXAS

THE CHANGING CHARACTER OF SOUTHWESTERN AGRICULTURE

During the past two decades, far-reaching changes have
occurred in southwestern agriculture. Some of these, such as
the mechanization of farming and ranching operations and
greater use of power machinery, are quite obvious and well
known. Others, such as the decrease in the number of persons
employed in agriculture, a declining farm population, and
changes in the business and financial aspects of farming and
ranching, have received less attention and probably are not
as widely recognized. The shifts and developments that have
taken place in agriculture during the past 20 years not only
have revolutionized fanning methods but also have changed
the character of agriculture as an industry and have altered
somewhat its position and inOuencc in the economy.
The decrease in the number of persons employed on farms
and ranches in the Southwest* during the past decade has
been striking. The downward trend in agricultural employment is not a recent development - it has been evident for
many years - but the decline was accelerated by the war
and defense programs of the past 15 years, the rapid and extensive mechanization of agriculture, and the growing industrialization of the Southwest. As industry demanded more
workers and offered higher wages, people moved from the
rural areas to accept these higher paying jobs and, as a result,
left fewer people to operate the farms and ranches. In the
meantime, technological progress in agriculture, in the form
of machinery and methods, actually enabled the smaller farm
labor force to expand production.

ployed - including the self-employed, part-time employees,
and unpaid family workers - was rising steadily. Hence,
the percent of the total labor force employed in agriculture
has declined sharply. In 1930, workers in agriculture - including farmers and their families, as well as hired laborers - constituted 40 percent of the total labor force in the
Southwest. By 1940 the number decreased to 31 percent, and
by 1950, to 17 percent. Estimates for 1952 indicate a further decline to about 14 percent. Similar changes, although
of a lesser degree, have been evident in employment data
lor the Nation. For the United States, employment in agriculture in 1930 represented 22 percent of total employment;
in 1940, 19 percent; in 1950, 12 percent; and in 1952, 11
percent_
Much of the decline in farm employment during the past
two decades has been in the number of hired farm workers.
Mechanization has reduced the need for hand labor, and
man y farm operators have found it possible to do virtually
all of their work with the aid of power machinery and equipmen t. Twenty years ago it was not uncommon for the owner
of a farm or ranch to devote most of his time to supervising
th e work oI the laborers on his farm or ranch and very little

EMPLOYMENT'"
FIVE SOUTHWESTERN STATES·

In 1930 there were 1,387,400 persons employed in agriculture in the Southwest, but by 1940 the number had declined
to 1,180,473, or a loss of 15 percent. During the forties the
shrinkage in agricultural employment was at a more rapid
pace, and by 1950 the number of such workers was only
821,209, reflecting a decline of 31 percent for the decade_
Tentative estimates indicate a further decline since 1950, with
probably not more than 788,000 persons working on southwestern farms and ranches in 1952.
The major portion of the decrease in farm employment
occurred at a time when the total number of persons em-Includes the states lying wholly or partly in the Eleventh Federal
Reserve District - Arizona, Louisiana, New l.1exico, Oklahoma, and

Texas.

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118

MONTHLY BUSINESS REVIEW
d uce the food and fiber required by the population or as
long as there were no alternative opportunities for employment at favorable wages. Moreover, as long as farm labor
was cheap, there was less incentive for agriculture to increase
greatly its use of labor-saving machinery. However, as industry and technology provided tools which made it possible for
fewer people to meet the foo d and fiber needs of the Nation
and growing industrialization of the Southwest provided
opportunities for fa rm labor to earn a more satisfactory wage
than could be obtained in agriculture, workers began to move
from the farm to the factory.

TRACTORS ON FARMS
F IVE SOUTHWESTERN STATES ·

1920

1930

:.A.[~~~";:\t~.O~ I II(I"~, Nlw loU,leo,

SOURCE ' unlu§ Sld'l .

1940
O_'~"omo , (I~d

O.po"ml"' el

1945

1950

1952e

T .. H

Agtl~""",I.

to performing the actual work of tending crops and livestock. Today, most operators of small farms, and many who
have relatively large acreages, find it more profitable to use
mechanized equipment and perform almost all of the production operations themselves, hiring only during the period of
harvest when extra labor may be needed_ Moreover, today's
farmer has found that he can do the job much easier, more
efficiently, and in less time than it required 20 years ago
with a number of hand laborers and with horses and mules
for power_
Thc number of farm operators also has decreased substantially. In 1930 there were 906,377 farm operators in the five
southwestern states. By 1950 the number was 632,005, a
decline of 30 percent. The movement of tenants away from
farms was at an even faster rate, with a drop of 63 percent
from 1930 to 1950, including those who became farm owners. Sixty percent of all farmers were tenants in 1930; by
1945, only 39 percent of the farm operators were classified
as tenants; and by 1950 the percentage had decreased to 32
percent. The class of tenants generally known as sharecroppers has been virtually eliminated as the mechanization
of farming operations has made it more profitable to operate
larger and larger farming units, rather than many small
units_
Greater use of power machinery has enabled farmers to
increase the size of their operations, even with a reduced
labor force. For example, 20 years ago one man and a pair
of mules could do the work involved in raising not more than
40 acres of cotton. Toda y, many west Texas farmers, with
four-row tractor equipment, do all the work required in growing 200 acres of cotton. This sharp increase in the amount
of work that can be donc by one man equipped with modern
machinery and the related upward trend in the average size
of farm units have resulted in a decrease in the number of
farms and ranches in the five southwestern states from 906,377 in 1930 to 800,269 in 1940 and 631,742 in 1950.
Changes such as these in agricultural employment could
not occur as long as most of the workers were needed to pro-

The growth of the industrial segment of the Southwest
since 1940 is illustrated by the sharp increase in nonagricultural employment, which rose from 2,678,000 in 1940 to
4,684,000 in 1952, and the increase in manufacturing employment from 383,000 ir 1940 to 722,000 in 1952. This
tremendous increase in nonfarm job opportunities has provided a co nstan t outlet for fa rm labor. Moreover, this pool
of farm labor that could be attracted to industry from the
rural areas has been an important factor in the industrial
growth of the Southwest.
As industry grew in size and numbers throughout the
area, job opportunities at relatively higher wages than those
available in agric ulture increased, and more and more people left their agricultural jobs to take employment in industry, even though they may have continued to live on the
farm. With a declining labor supply, rising wage competition, and an increasing demand for food and fiber by a
growi ng nonfarm population, farmers fonnd it not only
profitable but also necessary to make use of labor-saving
eq uipment and machinery. Moreover, the introduction and
wider use of equipment and machinery created a self-generative influence, because nonmechanized units were faced with
the competitive stimulus of the more efficient and more productive mechanized units. Thus, in a sense, agricultural developments reflect the steps taken in an industry in which
there is increasing pressure toward the "economic survival
of the efficient."
At the same time that these developments were taking
place, there was a decrease in the number of persons living
on farms and ranches. In the five southwestern states the
farm population declined from 4,447,000 in 1930 to 4,200,000 in 1940 and 2,600,000 in 1950. In 1940 the farm population constituted 35 percent of the total population of the
Southwest, as compared with 40 percent 10 years earlier,
while in 1950 it represented only 19 percent. Estimates for
1952 suggest that this trend has continued and that the farm
population now is only about 16 percent of the total. By
contrast, total populati on of the area increased 16 percent
during the decade of the forties.
The shift of population away from farms has not been
uniform in all sections. In a few areas, notably the irrigated
sections of the South High Plains of Texas and the irrigated
valleys in New Mexico and Arizona, where more acres have
been placed under irrigation and where farming has been
relatively profitable, there has been a net increase in farm
population. In parts of the Southwest where industries havll

I

MONTHLY BUSINESS REVIEW

POPULATION
FIVE SOUTHWESTERN ST ATES·

-Ariz al'lo, Lou lllo l'lG , NIW Mu l~o . O~l ohoma , and Tuo •.
e-EslirMltO
SOURCE ; Unllld S l olll DI~orrmlllr 01 CO"ufttrce

moved into the smaller towns and cities, the farm population
has tended to remain more stable as many workers in the
plants continue to live on farms and to operate them on a
part·time basis. However, in communi tics where virtually no
industry has been established, where the fertility of the soil
has been dcpleted seriously, and where profitable employ.
ment opportunities have been uncertain, the decline in farm
population has been very sharp.
The movement from rural to urban areas and from farm
employment to nonagricultural employment during the past
20 years has been relatively constant. The only important
break occurred immediately after World War II, when there
was a moderate movement back to thc farm as men returned
from the armed services and as industrial employment
slumped temporarily. Throughout the period, agricultural
workers have moved from the farms to the cities. Sometimes
the entire family moved; in other cases, farming became a
secondary occupation of the family, as one or more members
accepted jobs in plants or installations within commuting
distance of their farm homes.
This movement of farm population toward industrial cen·
ters in the Southwest is most graphically illustrated in the
case of the larger cities which have shown such substantial
population increases, but this population shift has not been
confined to those larger centers. Many smaller cities and
towns throughout the area have participated in the growing
industrialization. The establishment of industrial plants in
these smaller cities in the more rural areas of the Southwest,
with employees Ilwnbering upward from 25 or 50 people,
has provided jobs on a full·time or part·time basis for many
farm people.
Total agricultural incomc and income per worker have
risen during the past decade. Although this increase has been
fairly steady since 1939, it has not been uniform from year
to year. Agricultural income in the Southwest is heavily inAuenced by the size of the cotton and grain crops, which
fluctuates considerably from year to year, depending upon
acreage and weather conditions.

119

Since 1940, total income payments to individuals working in agriculture have increascd 244 percent, while income
payments to those engaged in nonagricultural enterprises increased 343 percent. However, when the change in income of
those working in the various segments of the economy is
measured on a per capita basis, the increase from 1940 to
1952 amounted to 419 percent per agricultural worker, compared with 153 percent for those engaged in nonagricultural
industries. Based on data of the United States Department of
Commerce and the Bureau of the Census, it is estimated that
the per capita income of agricultural workers rose from $560
in 1940 to $2,890 in 1952, whereas the per capita income for
nonagricultural workers increased from $1,530 to $3,880
during the same period. Expressed another way, the agricultural worker's per capita income rose from about 36 percent
of that of the nonagricultural worker to almost 75 percent
between 1940 and 1952. Consequently, although total agri.
cultural income in the area did not keep pace with the rate
of growth of nonagricultural income, the agricultural worker
improved his position considerably, relative to that of the
nonagricultural worker.
Wholly comparable agricultural income data by states are
not available covering a sufficiently long period of years to
establish a conclusive long-term trend, but available data
seem to permit certain generalizations. For instance, income
payments to farmers in the southwestern area as a percentage of total individual income payments in the Southwest
declined from 18.4 percent in 1929 to 13.9 percent in 1940,
U.8 percent in 1950, and about 1l.1 percent in 1952. Even
if one acknowledges that agricultural income may Auctnate
rather sharply from year to ycar as a result of abnormal
influences affecting certain major crops, figures such as those
cited probably should not be ignored. Perhaps they point at
least to the possibility that the area's agriculture is contributing a smaller share of the area's total income than was
the case in earlier periods.
There is little doubt that per capita income of agricultural
workers has risen substantially. In this case also, while data
are perhaps not conclusive, it seems reasonable to make the
generalization that the trend of per capita income of agricultural workers has been upward at a rate in excess of that
for nonagricultural workers. Moreover, it appears that this
absolute and relative gain in per capita income is, in large
degree, a reflection of the greater increase in productivity
per worker that has resulted from the growing application
of mcchanical and technological advancements to agricultural
production practices. Perhaps it is true to say that production methods in agriculture have undergone more marked
changes than is true in the case of nonagricultural pursuits
as a whole.
Wl,ile these developments have been taking place, agricultural production, as reflected by the accompanying chart, has
shown an upward trend. Greater productivity per worker in
agriculture has enabled the industry to experience this increase in output during a period when the labor force engaged in agricultural production was declining steadily.

MONTHLY BUSINESS REVIEW

120

AGRIGULT URAL PRO DUG TION
FIVE SOUTHWESTERN
19:!>.5-~9 ·100

STATES'

p, rttnf
1>5

P

'"I ent
35

12 5

"

1\

5

105

95

85

f\ J

\

\\

rJ\

A

j\J"

I

I 15

95

fJ

85

V
1935

/

:/

I0 5

o
1930

\

I 25

1940

1945

1950

75

o

19 55

•.,.,I:ofto, LOUlelon", NIW ~uic:o, O, tollo m., Q"G T••••.
SOUI'fC( : Unllto Siole. O ,~o rt""~ l 0 1 .II gdt~ lI ur.

Many factors other than the increased mechanization of
agriculture have contributed to the rise in productivity.
Technological improvements, such as the development of
hybrid corn, the breeding of disease· resistant grain varieties,
more effective insecticides for combating insects, and greater
use of fertilizer, have improved per acre yields and have
reduced the risk of crop failure. High·energy feeds, the dis·
covery and use of additional vitamins and antibiotics, and
improved feeding techniques have raised the efficiency of
producing livestock and livcstock products.
In the field of technical progress in production, perhaps
one of the more important programs in the past 20 years has
been the wider use of soil conservation and improvement
practices. For example, the use of legumes in rotation with
cotton has increased per acre yields more than 50 percent
on some farms. Terracing and the use of sodded waterways,
together with suitable crop rotations, have contributed great.
ly to the conservation of water and the reduction of soil
losses through erosion. In the High Plains, new techniques
for retarding soil erosion have assisted farmers in the battle
against drought and soil losses from blowing.
Electricity is one of the more spectacular tools that has
been added to the farmers' resources. As recently as 1930,
only about 4 percent of the farms and ranches in the Southwest had electric power available to them. By 1945 the number had increased to 35 percent of the total, and by 1950,
to 73 percent. It is estimated that electricity now is available
to more than 90 percent of the farms and ranches in Texas.
Electric power has brought to the farm operation a multitude
of labor·saving devices, including pressure water systems for
livestock and for the farm home, feed grinders and mixers,
elevators, electric welders, and milking machines. In addiLi on, electricity has brought lights, refrigeration, electric
washing machines and ironers, and many other consumer
goods into the farm home, improved the efficiency of the
farm family, and raised its standard of living.
The impact and influence upon agriculture of changes
such as those which have been discussed have been signifi-

cant. As compared with an earlier·day agriculture, the presen t·day agriculture in the Southwest has taken on many of
the characteristics of a mechanized industrial- or business·
type oper ation .
First, a much larger capital inveshnent per worker is reo
quired on the present-day farm or ranch. The shift from
mules and relatively cheap hand labor to power machinery
and mechanically equipped, relatively skilled workers in·
volves very s ubstantial expenditures. The capital investment
on a comparatively small farm - say 200 acres - can very
quickly mount to $10,000, in addition to the value of the
land and buildings.
Secondly, the cash costs of operation have increased very
grea tly. Expenditures for fertilizers , insecticides, gas, oil,
tires, equipment repairs, and numerous other operating items
quickly can reach a very sizable sum. The need for reliable
access to cash emphasizes the importance of the establish·
ment of sound working relationships between the farmer and
his banker. Moreover, the growing size of farmers' cash requirements is reflected in the increased size of bank loans
and outstandin g credits to farmers. Furthermore, the greater
dependence of the farmers upon these products of industry
- fertilizers, insecticides, gas, oil, etc. - often may introduce a considerable rigidity into the farmers' cost structure.
Thirdly, a much higher quality of managerial, financial,
and business efficiency is required of the farmer today than
was the case in an earlier period. No longer can farming be
regarded as " just running a farm." Instead, it must be regarded as managi ng a very complex business, the success of
which may be very largely determined not only by the more
or less purely agricultural decisions but also by those deci·
sions of a management or financial character.
Requirements such as these mean that the successful farm
or ranch operator in the Southwest today must have consid·
erable financial strength and stability; he must have an understanding of the gains to be achieved from the "right"
combination of machine power and man power; he must be
well aware of the technol ogical advances in the production
of crops and livestock and be able to appraise their adaptability to his operations; he must keep reasonably well in·
formed regarding market trends as they r elate to his produc·
Lion; and he must have the business judgment and acumen
to foresee and make th ose adj ustments in his operations
which ma y be necessary if he is to meet changing conditions
as they develop.
In one sense, these developments in agriculture may seem
to raise serious and difficult problems, and perhaps they do.
More importantly, however, they have been instrumental in
creating a more sound, more efficient, and more productive
agricultural industry. Their advantages and contributions to
agriculture as a whole gready outweigh the problems they
have raised fo r the farmer or the rancher. Moreover, the
trend toward a more productive, more economically efficient
agriculture cannot and should not be reversed; there is no
turning back in this respect. In fact, every encouragement
should he given to ways and means that will further the
trend within sound economic limits.

MONTHLY BUSINESS REVIEW
Viewed in relation to total economic activity and sources
of income and employment in the Southwest, agriculture
undoubtedly holds a very important position. That position,
however, probably is not as dominant in its full effect upon
the over-all level of economic activity in the area as it was
in times past. For example, before the discovery of the rich
oil fields of Texas, probably it could be said with considerable truth that the Texas economy was dominated by cattle
and cotton. After the discovery of oil on a large scale in the
State, one might have modified the statement to include
cattle, cotton, and oil. As the years passed, one surely would
have added a great chemical industry, an aircraft industry,
a lighter metals industry, an expanding textile industry, a
larger food-processing industry, and many others to bring
the picture up to date. Then too, government has become an
increasingly important source of income to numerous parts
of the State as a result of the establishment of large military
bases, numerous air bases, and other installations.

The decline that has occurred in agricultural income as
a percentage of the total income payments in the area and
the decline in agricultural employment, while indicating for
that segment of the economy a somewhat less important relative position, by no means are indications of weakness or of
loss of strength. The increase since 1940 of 244 percent in
total income payments to individuals working in agriculture
is very substantial and is evidence of an expanding industry,
even when allowances are made for inflationary influences.
Moreover, the rapid rise in per capita income of agricultural
workers is a sign of genuine progress.

The increase in per capita income of agricultural workers
has had an important effect not only with respect to the individual worker but in a broader market sense. Undoubtedly,
agriculture as an industry and agricultural workers as a
group have become a much more important market for a
wide variety of industrial goods_ The shift to mechanization
has created a very significant demand for a miscellany of
capital goods, ranging from tractors and trucks to milking
machines and electric power systems, while the higher standard of living of people on the area's farms and ranches has
been reflected in a very substantial demand for many con-

121

sumer-type goods, running the gamut from automohiles to
radios and television sets.
Much has been said from time to time, and with truth,
of the importance of diversifying agriculture to give it
greater strength and stability. This has been done to a notable degree in the Southwest, and additional crops and types
of livestock production have risen to positions of importance.
These innovations in the area's agricultural production have
represented a part of the movement away from a "one-crop
system" to a more diversified, better balanced agriculture.
The same position, however, can be equally well held and is
of quite as much importance with respect to the changes that
have taken place in the total economy of the area. The diversification in the sources of income and in the fields and opportunities of employment have shown very marked progress
during the past 20 years. Many communities in the Southwest now derive their income from several better halanced
sources and are less dependent upon the economic well-heing
of anyone type of activity. A crop failure, for example, in
many of the agricultural sections of the area is not likely to
have the same widespread deadening effect upon trade, business, and incomes as in times past, for it is not uncommon
in such cases to find that oil and gas receipts, small-scale
industrial payrolls, or perhaps government payments tend
to have, at least in part, an offsetting effect. Even those who
believe that perhaps cattle and cotton are the economic kings
of the area will admit that there have come into being in
recent years some very important crown princes_
Undoubtedly, present-day agriculture in the Southwest is
more efficient, and it represents a stronger, more stable segment of the economy of the area than its counterpart of the
twenties. Furthermore, it seems that the over-all effect of
these changes that have taken place has been to build in the
Southwest a more efficient total economy as measured in
terms of productivity; an economy as a whole that is less
vulnerable to the shocks of economic adjustment or adversity
and, consequently, is more stable; an economy that has seen
a steadily rising standard of living, especially among those
groups whose earlier standards were relatively low compared with other groups; and an economy that offers much
greater opportunities to its people.

122

MONTHLY BUSINESS REVIEW

REVIEW OF BUSINESS, AGRICULTURAL, AND FINANCIAL CONDITIONS
Retail sales at reporting department stores in the Eleventh Federal
Reserve District in July were 12 percent below the high level of June but
maintained a I-percent gain over
July 1952. Sales turned up during the first 2 weeks of August,
to top year-earlier sales by 2 percent. Cumulative sales for the
first 7 months of 1953 exceeded those of a year ago by 4 percent. Accounts receivable at department stores on July 31
were down 3 percent from a month earlier; inventories rose
to a level 9 percent higher than a year ago. July sales at reo
porting furniture stores trailed those of the same month last
year by 16 percent.
Crop prospects and the condition of ranges and pastures
improved considerably during late July and August as rains
fell over most parts of the area. Larger crops of rice, sorghum grain, hay, peanuts, and potatoes are forecast for the
five states of the District as compared with the 1952 harvests,
while production of corn and cotton is expected to be lower.
Weekly shipments of cattle to market continue to exceed
those of a year ago. Farm commodity prices are holding relatively steady.
1'"'
Stocks of major refined petroleum products in the Nation
are at very high levels; gasoline stocks have declined less
than usual this summer, and the build-up in distillate stocks
has resulled in some price trimming on the East Coast. Refinery activity in the District has been cut back some because
of the mounting stocks of refined products. Crude oil production in the District, which has been rising in recent months,
is expected to decline in September, due to the reduction in
Texas allowables.
Most major categories of nonagricultural employment,
except government, continue to rise in the district states,
stimulated by seasonal, as well as long-term growth, factors.
Construction, mining, service industries, and transportation
and utilities have registered large gains in recent months.
Meanwhile, unemployment also has risen this summer beca use of the addition of students to the labor force and the
layoff of Federal Government workers. Nonagricultural employment is expected to rise further in September.
The value of construction contracts awarded in the District declined in July to a level 18 percent below a year
earlier. The decline from June reflects principally a drop of
25 percent in awards for residential building. Construction
contract awards in the first 7 months of 1953 were valued
at 17 percent less than those for the same period last year.
Loans of the weekly reporting member banks rose less
than one-half of 1 percent between July 22 and August 19;
investments increased 1.9 percent. Gross deposits were reduced less than one-half of 1 percent as a slight increase in
time deposits was more than offset by a decline in demand
deposits. Debits to deposit accounts reported in 24 cities of
the District declined seasonally in July but remained 7 per-

cent above a year earlier. Net profits of member banks in the
District in the first half of 1953 showed a 13-percent gain
over the same period last year_
The total dollar volume of retail
sales at department stores in the
Eleventh Federal Reserve District .
during J ul y declined 12 percent from
the high level of June but gained 1
percent over July 1952. Although July normally marks the
smmner low point in department store trade in this District
because of vacations and other seasonal factors, the seasonally adjusted index declined 7 percent from June.
Sales activity usually rises in Augnst as the vacation pe"riod
draws to a close and early back-to-school buying begins. During the first 2 weeks in August, daily average sales gained 3
percent over the first 2 weeks in July and were up 2 percent
relative to the comparable period in August last year.
Cumulative sales for the first 7 months of 1953 were nearly 4 percent above the same period in 1952, despite the
strong upsurge in sales of major appliances and television
sets that was experienced last year following suspension of
Regulation W. The year-lo-year increase in cumulative sales
of district department stores was due, in part, to intensive
merchandising efforts and, in a very large part, to the continued record and near-record levels of employment and personal income.
While there have been exceptions in certain localities, department store reports indicate that economic conditions
thus far this year have been favorable over most of the District. In fact, the cumulative gain over sales of 1952 has been
at approximately the same rate for department stores located
in the smaller cities as for stores in the larger cities.
RETAil TRADE STATISTICS
(Percentage change)

NET SALES

STOCKSl

July 1953 from

line of trade
byared

July

1952

June
1953

7 mo. 1953
compo with
7 mo. 1952

July 1953 from
July
1952

J"".
1953

9
17
10
9
5
10
11
15
-2
9

2
-1
8
3
1
1
5
-7
1

DEPARTMENT STORES
Totol eleventh District .•....•......

I

4
4
EI POlO • .•• •• •.•..• ••.•••••••• •
-3
Fort Worth •...•.•.....•.... •...
-7
HOll5ton . • .. •.• • •....•••..•.... •
3
Son Antonio . ..... .. .... . .. •....
-2
Shre... eport. La .... .....•....•....
-2
Waco ..... .......... . . . . . ..... -11
Other cities .. .................. .
-1
Corpus Christi •. ................ .

Dallas •...•...•.. . .. ... ... • ... .

FURNITURE STORES
Total eleventh District .............

Austin •.... ... ....• .. . • ..•..•. .
Dallas ••••....••..••..•.•• ..•. .
Houston •••• • .•••. • •••.•••...•. .
Port Arthur ••. .•• •••••..••...• .•
Son Antonio •• ••.•.•....••••••••
Shre¥eport, La .... •••.•••••••••••
HOUSEHOLD APPLIANCE STORES
Total Eleventh D1strict •••..•..•.•..
Dallas ..... ....................
I Stocks at end of month.

_16
-9

-12
-15
-7
-19
-14
-8
-12
-17
-33
-15

-15
-35
-26
8

- 19
-5
- 27
-19
-45
-12
-16

-3'
-30

-23
-36

-24

I Indicates change of less than one·half of I percenT.

4
12
4
6
-2
7

- I

4
-1
4

- ;
3
13

1

-1
-1
5

-19

-1

-3

-2

123

MONTHLY BUSINESS REVIEW
WHOLESALE TRADE STATISTICS

Eleventh Federal Reserve District

ANNOUNCEMENT

(Percentage change]

The Research Department of the Federal Reserve
Bank of Dallas has reviewed its adjusted indexes of department store sales for the Eleventh Federal Reserve
District and lor the cities of Dallas and Houston, Texas,
jor the period from January 1951 to June 1953, inclltsive, lor the purpose of making revisions in monthly
index numbers wherever indicated in order to allow for
gradual shifts in seasonal influences. Adjusted stock indexes for the Eleventh District were reviewed for the
same purpose, and appropriate revisions were made.
Although the revisions are minor, it is believed that the
revised indexes reflect more accurately only the main
nonseasonal movements that occurred during the period. Index numbers prior to 1951 remain unchanged.

NET SAlESp

STOCKS'p

July 1953 from

Une of Irade
Dry goods • ••• •••• •• •. •••

Jul y

June

1952

1953

7 mo. 1953
compo wIth
7 mo. 1952

July 1953 from
J~ y

June

1952

1953

-6

6

41

10

-4
3
10

-2
-6
2

-4

-13
10
-1

1
-2
-6

- /
-2

8
-7
-2

-3
-6
1
-7

Grocery (full-line wholesalers

not sponsoring groups) • • •
Hardware • •• • •••• •• •• •••

Indultriol supplies • ••••.•••
Machinery equipment and
supplies except electrical -29
Metals •••• •••• • •••••• ,_. -23
Tobacco produds ••• • ••• . •
-4
Wines and IIqvors ••• • •• . •
- I

I

-35
-I

-8
6

4

1 Stoeb at end of month.
p-Prellminory,
.
, Indlcales change of less than one-half of 1 percent.
SOURCE:! UnIted Stotes Bureau of the Census.

Although sales of major household appliances and television sets were exceptionally heavy during May, June, and
July last year, sales of major appliances for the first 7 months
of this year exceeded those for the comparable period in
1952 by approximately 7 percent. Sales of television sets
over the 7-month period, however, declined 18 percent. At
department stores reporting a monthly breakdown of sales
by departments, hard goods, mainly homefurnishings, showed
a 7-month gain of 2 percent, compared with an increase of 3
percent in the soft goods lines.
During the month of July, department stores recorded
gains in sales over a year earlier in most major soft goods
departments, ranging from 2 percent in sales of men's and
boys' wear to 6 percent for women's and misses' wearing apparel and 10 percent for household textiles. These gains were
largely offset by a year-to-year decline of approximately 8
percent in sales of homefurnisrungs.

The revised adjusted indexes are shown in the accompanying table_

REVISED ADJUSTED MONTHLY INDEXES OF
SALES AND STOCKS

DEPARTMENT STORE

(19017·49-1001

Elevenlh Federal Reserve District
SALES

STOCKS

Month

1951

1952

1953

1951

1952

1953

January • • • ••••• •••••••• • • • • •

129
118
113
113
113
113
114
114
115
114
127
120

120
115
117
116
129
132
124
126

127
125
126
1201
131
1301

129
127
133
138
140
139
139
140
132
125
122
126

124
123
123
122
123
124
129
127
129
129
131
132

135
134
133
138
139
141

February • • ••••• •• • • • ••• •• •• •
March ••.• • ••• • , ••••••••••••
April •••••••• • •• • • • • • •• •• •• •
May • • •• • •••••• • ••••••••• ••

June: ••••• • • • •• • ••••••••••••
July • •• ••••• ••••••• • • • ••••••
August •••• • ••• • •••••••••••••

September • • • • •• ••• • •• • •••••
Oelober ••••••••••••••••••••

November • •• • • ••• •• •••• •• •••
Dl!cemher •••••••• • ••• •• • • •••

120.

128
128
128 _

Dallas and Houston

Total accounts receivable at department stores during July
declined 3 percent because of a 6·percent reduction in regular charge accounts. Instalment accounts rose 1 percent during the month, to an amount representing 51 percent of total
receivables.

DALLAS SALES

1951

1952

1953

1951

1952

1953

January ••• •• ••. .•• . ••• . •••••

133
117
1101
109
110
109
109
108
108
110
123
116

118

122
119
116
118
127
130

127
130
123
121
120
121
128
127
130
122
1010
134

132
128
131
128
142
145
138
141
133
150
145
147

146
143
145
146
146
148

February •••••••• • ••••••••• • •

Marth • ••••••• • • ••••••••••••

April .. . .. ...... . .. .........

May ••••• • •••••••••••••••••

June •• • •• • • • • • • ••••••• • ••• •

Based on collection ratios, the average collection time on
charge accounts during July was 63 days - 2 days shorter
than both the previous month and July"l952. For instalment
accounts the average collection time was 17 months, which
shows no change from June and compares with 13 months a
year ago.
INDEXES OF DEPARTMENT STORE SALES AND STOCKS

(19017.019

=

1001

UNADJUSTED

July

Area

SALES-Daily ove rage
Eleventh Distri r:t • • •••. . • ••

Dolle s ••••• • •• ••••• •• • ••

Hou:;'on ••• •• •.•.•••••• . •
STOCKS-End of month
EJeventh District • • •• ••• . ••

May

118
107
135

127
124
144

104
96,
120

124
123
143

131p 130

141

120

141p 141

July

1953 1953 1953 1952

Adiusted for seasonal variation.
r-Revised.
p-Preliminary.
I

July •• •• ••• •• • • • • •• ••• •• ••• •
Aogust ••••••••• •• •• •• •• •• • • •

Se ptember •• ••• • ••• ••• • •• •••
October • • • •••• •• •• • ••• •••• •
November ••• • • • • • ••• • ••••• • •
December • • •••••••••••• • •• • •

III

109
1101
119
126
118
115
116
124
120
124

Department store inventories at the end of July were 1
percent larger than at the end of June and 9 percent larger
than a year earlier. Merchandise on order on July 31 was
down 6 percent from the previous month and 4 percent from
a year ago_

ADJUSTED1

J",,"

1001
99
1201

HOUSTON SALES

Month

July

J",.

May

Jvly

1953 1953 1953 1952
1301
130 r

148

r

13 1 r 12A.r
127r 118r

146

138

139

129r

Furniture store sales at reporting stores in the District
during July declined 19 percent from June and trailed yearearlier figures by 16 percent. Total accounts receivable were
reduced 1 percent during the month but remained 15 percent
above a year ago . Collections increased during July to a
level 5 percent above the same month last year. Inventories
on July 31 were not significantly different from a year
earlu.. -

124

MONTHLY BUSINESS REVIEW

The cotton situation dominates the
agricultural picture in the District
at this time. Harvest of the crop has
been completed in the Lower Rio
Grande Valley and the lower coastal
counties of Texas. The crop was below earlier expectations
in these areas, with the August 1 estimate for the Lower Val·
ley placed at 280,000 bales, the lowest since 1947. Picking
is nearing completion in the upper coastal counties and is
becoming active in central and northern counties.
Prospects for above·average cotton yields continue good
throughout most of the Blacklands section of Texas, in east
Texas, and in northern Louisiana, although there is con·
siderable acreage of late cotton in these sections on which
production is qillte uncertain at this time. If present crop
prospects materialize in the central and northeastern parts
of Texas, the crop will be the best in these areas since 1950.
In eastern counties of the Low Rolling Plains of Texas
the cotton crop is making fairly satisfactory progress. The
hot, dry weather of June threatened cotton production, but
July and August rains in most of these counties have enabled
the crop to recover and make satisfactory growth.
In west Texas and in the western counties of the Rolling
Plains, prospects for dry·land cotton are not very bright.
Some acreage survived the summer drought and was bene·
fited materially by the late-July and August showers. In the
area between Lubbock and Midland there is virtually no
dry·land cotton, and considerable acreage of irrigated cotton
was lost to high winds and drifting sand. Elsewhere in the
High Plains, irrigated cotton acreage is reported to be very
promising; current private estimates of the crop for the
South High Plains are in the neighborhood of 1,200,000
bales, about in line with last year's crop. The major hazard
to the crop in the High Plains area is the possibility of an
early frost.
The Nation's cotton crop was estimated at 14,605,000
bales by the United States Department of Agriculture on August 1. This for ecast was based on an expected average yield
of 291.7 pounds, which is 10 pounds higher than the yield

of the 1952 crop and 20 pounds above the 1942·51 average,
The condition of the crop is reported to be excellent through.
out the Mid·South and the far West, as well as in parts of the
Southwest.
Cotton acreage abandonment has been unusually heavy
this year, with a substantial portion of the abandoned acre·
age in Texas. The prolonged drought forced a reduction in
cotton acreage in the State from 11,756,000 acres planted
in 1952 to 9,284,000 acres estimated to be in cultivation on
July 1, 1953.
The outlook for feed crop production in the District im·
proved sharply as showers fell over a wide area of west and
northwest Texas. Much additional acreage was seeded to
sorghums during late July and early August, and if weather
conditions continue favorable, a substantial part of this acre·
age will mature before the average date of the first killing
frost , Grain sorghums are providing a major part of the
District's feed crop this year as corn production is down
sharply from a year ago. In Texas the corn crop is the small·
cst since 1879. A bwnper crop of oats also is adding mate·
riall y to the supply of feed grains.
A substantial acreage of feed and forage crops, threatened
by the hot, dry weather of Jun e, was utilized as silage this
year as farmers attempted to salvage as much of the green
feed as possible. Additional acreages of feed crops that were
threatened by the drought were grazed off. Generally favorable growing conditions, except during June, in much of the
District have permitted harvesting of a hay crop that is
around 10 percent higher than a year ago.
Harvest of a record rice crop in Texas is making rapid
progress, with excell ent yields reported. The prospective crop
of 14,500,000 100-pound bags would be the largest ever pro·
duced in Texas,

HORnlERN
JiIGH PLAINS

I-N

COTTON PRODUCTION

Texas Crop Reporting Districts
lin thousands of bales-SOO th. gross wt.}

1953

1953

1952

Indicaled
August'

As percent of

467
1,005
182
59
12
610
95
96
240
17
200
222
231
62
31 0

525
675
110
245
35
665
95
110
220
35
180
85
240
25
280

112
67
60

10·5 •.• • .•. ••••.•.•

351
941
288
218
33
608
113
85
192
25
192
86
25.
7.
607

292
109
100
11 5
92
206
90
38
104
40
90

Slate •••••• • ••••••

4,074

3,808

3,525

93

Crop reporting distriet
l·N •• • • ••••••• • • • .•

1-5 • •• • • • •• • • •.••.•

2-N • ••••••• • ••••• • •

2-5 , .. .... . . . ... ...

3 . . . .... .. .. . ..... .

4 •• • • ••• •..•• • .• • . •
S·N • • • • • •• • • •••••••

5·5 ... . ... . .. .. . . . .
6 .... .. .. . . .... . ...
7 . .. . ... . ... . .. . . ..
8·N •• •• •••••••• • •••

8·5 •• • .• •• ••• • . • •• •

...................
lO·N ••• • • •••• • • ••••

1951

SOURCE: United Stohu Department of Agriculture.

1952

415

CROP REPORTING
DISTRICTS OF TEXAS

MONTHLY BUSINESS REVIEW

125

ClOP PRODUCTION

LIVESTOCK RECEIPTS

Texas and Five Southwestern Slates

(Number)

(In tho\lSQnd, of bushel.)

fORT WORTH MARKET
T.xas

five solltbw.stern states t
Clou

19.53
Crop

1942-.51

19.52

Indicated
August 1

CoHon' , •• • •••
Com • • • .• ••••

3,162
5-'.256
59,088
25,280
2,986
202
9,498
80,523
734

3,808
41,292
34,626
20,910
870
216
13,662
48,236
1,062
1,512
85,100
2,0"'0
1,215

3,.525
29,768
21,681
37,638
1,755
247
14,500
56,000
1,008
1,617
130720
2,398
1,890

Average

Winter whea t ••

Oats, ••••....
B(uley •••••• ••
Rye ••••••••••
Rice ' ••• ••••••

Sorghum grain .
Flo~511.d ••. •••

Her. .. .. ....

1,547

Peanut.s , • ••• • 312.916
Irish potatoe, ••
",0"0
Sweet potatoes
4,372

19.53
Ind cated

t;:2~~i

19.52

August 1

4,664
97,664
134,029
47,630
10,937
785
20,021
96.850
1,328
4.739
4 38,361
8)'96
14,272

6, 106
65,587
142,966
32,198
7,738
1,176
26,304
55,057
1,150
4,605
136,400
4,800
9,235

5,817
51,239
92,223
52,927
9'm
27,226
67,465
1,008
4,775
210,820
5,882
12,910

I Arizono, Louhiana, New Muko, OkJahoma. and Toxas.
thousands of bales.
thousands of bags, 100 pound. each.
thotnoands of tom.
thousands of pounds.
SOURCE, Unit.d Sta' •• Department of Alilric""'ure.

t in
In
• In
• In
S

The District's peanut crop, while substantially larger than
a year ago, is still less than half of the average crop during
the past several years, A larger acreage was planted this year
and yield prospects are somewhat more favorable, except in
so uth Texas, where the crop was cut short by dry weather,
Pecan production in the District is expected to be above
average, even though a bumper crop was harvested in 1952.
Tbe Texas peach crop was about average but substantially
higher than in 1952, Broomcorn production in Texas was reo
duced by the hot, dry weather, and production is forecast
at only about half of last year's crop and slightly below aver.
age. A sweet potato crop more than 50 percent larger than
last year's very short crop is in prospect, while Irish potato
production probably will be moderately higher than the short
crop a year ago.
Prospects for fall vegetable production in the District are
uncertain, due to the shortage of irrigation water in most
of the major producing sections of south Texas. Consider·
able acreage is being prepared, and some planting has been
done, Lack of rainfall and shortage of irrigation water in
the Lower Rio Grande Valley of Texas have curtailed se.
riously development of the trees and production of citrus
Iruit. Prospects for production continue to decline, with most
growers concerned primarily with keeping trees alive.
Ranges and pastures in the District improved as showers
during late July and August were fairly general over much
of the drought·stricken areas. In most of south and west

/;13

Cortle •••• •• ••• 100,696
Calvel •••• ••••• 27,539
Hogs •••••• •••• 26,635
Sheep •••••••• , 67,966
1

J.ty

J..,.

1952

1953

77,153
27,633
44,133
96,479

Stat.
Ari%Of'lCl •• ••••••• • •• •

t;:;~~i
3,298
518

1952
2,590
326
11 ,590
963

1953p

Texas • • •• . •• • • •••• •

1.496
6",864

1.6,277

2,667
364
11,790
834
41,101

Totul • • ••• ••• •• •• •

83,230

61746

56,756

louisiana ••••••• .• •• •
New Me:dco ••• •••• ••
Oldohoma ••• ••••••••

13,05A.

p- PreCimfnory.

SOURCEI United Stole, Deportment of Agriculr",re.

1953
As percent of
oy.rClge

81
70
90
56
63
68

i~13

130,631
27,497
35,049
144,095

29.222
21,256
'17,085

July

June

1952

1953

20,162
11 ,0 89
5,806
120,860

36,391
21,283
276
131.423

Include. "oats.

Texas and in eastern New Mexico, range feed is very short,
and additional rains will be needed to stimulate growth.
Elsewhere in the District, ranges and pastures are providing
ample feed.
The movement of cattle and calves to market continues to
exceed the volume shipped a year ago by a substantial mar·
gin. However, the increase over a year earlier is narrowin~,
since marketings in the fall of 1952 were very heavy, It IS
anticipated that the volume of cattle and calves moving to
market will remain at a high level through the normal fall
marketing season. The 1953 Texas lamb crop is estimated
to be 8 percent larger than the very small 1952 crop. The
increase occurred despite the fact that the number of breed·
ing ewes on January 1, 1953, was 7 percent below a year
earlier, The number of lambs saved per 100 ewes was 66an improvement over last year but still below average.
There have been no major changes in prices of southwest·
ern agricultural products during the past month. Prices of
cattle and calves have fluctuated considerably from week to
week, depending upon the volume of receipts at major mar·
kets, Prices of cotton, wheat, oats, grain sorghums, and pea·
nuts are at or near the support levels, and it is reported that
prices of rough rice have declined as harvest progressed and
are now only moderately above the loan rate,
Wheat growers approved the use of marketing quotas on
the 1954 crop, and acreage allotments and marketing quotas
are being established for each farm. The Texas acreage
allotment is 5,021,000 acres, about 8 percent below the acre·
age seeded for harvest in 1953, Peanut growers, already
operating under quotas, probably will be asked to vote on
an extension of the program; producers of cotton and of
corn may be asked to approve or disapprove quotas for the
1954 crops, Under current legislation, where referendums
FARM COMMODITY PRICES
Top P,fc.s Pold In Local Southwest Markeff

SHORN WOOL PRODUCTION
(In thousands of pounds)

SAN ANTONIO MARKET

CommodHy and market

Unit

COTTON, Middling 15/16·lneh. Dollas •• •••
WHEAT, No. 1 hard, For. Worth •••••• •• ••
OATS, No. 2 white, Fort Worth ...........
CORN, No.2 yellow, Fort Worth ••••• ••••
SORGHUMS, No.2 yellow, Fort Wort+. ••••
HOGS, Choke, Fort Worth •• ••• • • ••• ••••
SlAUGHTER SolEERS. ChoIce, Fort WOft+. ••••
SlAUGHTER CALVES, Choice, fort Worth. ,.
STOCKER STEERS, Choke. Fort Worth ••••••

lb.
bu.
bu.
bu.

SLAUGHTER SPRING LAMBS, ClIoke, fo<t
Worth •••••••••• • ••••••••••••••••••
HENS, ~ ~unds and o".r, Fort Worth • • •••
FRYERS, ommardol, Fort Worth ••••••••••
BROILERS. south Taxol • •••••••••••••••••

Week ended Comparable Comparabl.
AUTOS' 21,
week
w••1e
953
las. mon'"
lalf year

cwt.
cwt.
cwt.
cwt.
cwt.

.3220
2.5014
1.01'h
1.91Y,
3.00
26.50
23.00
17.00
18.00

cwt,
lb.
lb.
lb.

21.00
.24
.28
.28

$

$

.3290
2.44
1.01
1.9014
2.92
27.00
22.50
21.00
17.00
23.00
.21
.30
.29

S .3860
2.60
1.10
2.11

3.53
22.50
31.00
28.00
2700

Yl

28.00
.21
.33
.33

126

MONTHLY BUSINESS REVIEW

are held, growers' approval of quotas assures price supports
for the co=odities at 90 percent of parity to growers who
comply with acreage allotments.

CONDITION OF THE FEDERAL RESERVE BANK OF DAllAS
(In thousand. of dollars)
August 15.
1953

Item

Net profits of the 635 member
banks in the Eleventh Federal Reserve District rose to a total of $27,744,000 during the first half of this
year, an increase of 13 percent over
the comparable 6 months of 1952. A gain of 32 percent in
current earnings on Government securities at country member banks and an increase of 17 percent in interest and discount on loans at reserve city member banks were among the
more notable developments contributing to the rise in profits
and reflected in the semiannual statements of earnings and
expenses.
Total earnings from current operations of the member
banks amounted to $120,064,000 during the first 6 months
of this year, as compared with $105,761,000 during JanuaryJune 1952. Slightly less than 23 percent of this expansion
was carried through to net profits, however, principally because of the partially offsetting effects of a 13-percent increase in current operating expenses and a 22-percent rise in
taxes on net income. In the first half of 1953, member banks
declared cash dividends of $8,692,000 on common stock, or
6 percent more than in the comparable period last year.
The relative increase in net profits of the District's member banks during the 6 months ended June 30, as compared
with the first half of 1952, was markedly greater than that
for all member banks in the United States - 13 percent for
the District and slightly more than 5 percent for the Nation.
Although increases in net earnings from current operations
and in taxes on net income of the Nation's member banks
compared favorably with those of district member banks,
losses, charge-offs, and transfers to valuation reserves rose
sharply in comparison with last year. Consequently, about
CONDITION STATISTICS OF WEEKLY REPORTING
MEMBER BANKS IN LEADING CITIES
Eleventh Federal Reserve Distric:t
(In thousands of dollars)
August 19,
1953

August 20,
1952

Total loons Igross) and inv.lfments •• • • •• •• ••• $3,255,431
Total loans-Net l . . . . . . . . .. . . . . . . . . . . . . . 1,794,624Total loans-Gross ••••.•.. ....•. • • •• .•. • 1,813,402
Commercial, Industrial, and agricultural
loans •• •• • • ••••••••••• •• •••••••••• 1,163,372
loans to broker. and dealers In securities ••
12,129
Other loans for purcha,ing or carrying
securities • •• •••••• ••• ••••••••••••••
72,071
Real estale loanl •• •• ••• •••••••••••• ••
134,270
Loans to banks •• •• •••••••••••••••• •••
22,456
All other loans •••• ••• • •••••••• •• •••••
409,104
Total in\lestments ••••••••••••••••••••••• 1,442,029
U. S. Treasury bills ••••••••••••••••••••
161,539
U. S. Treasury certiAcotel of indebtedness ••
203,016
U. S. Treasury note •••• ••• •••••••••••••
176,026
U. S. Government bond. (Including guoranleed obligations) ••• •• ••••••••••••
712,178
Other securilles •••••••••••••••••••••••
189,270
549,429
Reserves with Federal Reserve Bank •• ••••••• •
Balances with domestic banks •••••• • ••••••• •
428,731
Demand deposits-o dlusted' •••••••••• •••• •• 2,468,887
TIme d epo$lts except Government ••••••••..••
571.013
131,908
United States Govemment deposits •••••••..• •
Interbank demand deposits ••••.• • ••.• • •.• ••
772,199
Borrowings from Federa l Reserve Bonk ••••.•.•
44,500

$3,079,067
1,609,937
1,626,465

$3,223,467
1,789,002
1,807,755

1,083,134
12,143

1,154,428
10,982

65,362
121,155
9,688
334,983
1,452,602
213,443
174,384
182,336

73,478
134,863
30,018
403,986
1,415,712
153,546
196,752
177,999

708,305
174,134
601,803
396,367
2,398,033
480,45'
156,369
779,559
39,760

702,977
184,438
555,397
463,023
2,480,430
566,654
133,862
773,716
43,500

Item

July 22,
1953

1 Aft.r d.ductions for reserve, and unallocated chorge-off's.
2 Includes all demand depositJ other than interbank and United Sioies G overnment. less
cash items reported o. on hand or in process of collection.

Total gold certificate reserves ••••••••••••••• $ 588,849
Discounts for member bonks. .. . • • • • • . • •• • • •
51,870
Industrial advances.. ... • • • • • • • . • . • • • • • • • . •
0
Foreign loa ns on gold. • • • • • • . • • • • • . • . • • • • •
428
U. S. Government securities . • • • • • • • • • • • • • • •• 1.178,811
Total earning assets ••••••.••••..•.••••••.• 1,231 ,109
Member bank reserve deposits . • . • • • . . . . • • • .
995.616
Federal Reserve notes In actual circulation. .. .
728,863

July 15,
1953

August 15,
1952

$ 716,580
32,100

$ 501,648
28,423

1,387
1,055,700
1,089.187
1,038,654
721,034

428
1,205,271
1.234,122
934,172
727,953

o

o

9 percent of the expansion in earnings from current operations of the Nation's member banks was reflected in net
profits, or less than half the percentage for member banks in
the Eleventh District.
Between July 22 and August 19, loans of the weekly reporting member banks in the Eleventh District rose $5,647,000, or by less than one-half of 1 percent, to approximately
the January 21 record total of $1,813,742,000. The expansion in co=ercial, industrial, and agricultural loans even
exceeded the increase in total loans, reflecting principally the
rise in borrowing by commodity dealers and a group of miscellaneous commercial and industrial businesses. Construction firms and manufacturers in the food and liquor lines
also increased their outstanding bank indebtedness in most
weeks. On the other hand, wholesale and retail trade establishments and sales finance companies liquidated substantial amounts of borrowings.
Among the changes in other categories of loans were an
increase of $5,118,000, or 1.3 percent, in "all other" loans
(which include consumer-type loans) and a relatively sharp
reduction in loans to banks. Real estate loans and loans for
financing security transactions were practically unchanged.
Investments of the weekly reporting member banks rose
$26,317,000, or 1.9 percent, during the 4 weeks to a total of
$1,442,029,000. Holdings of Treasury bills, certificates of
indebtedness, and bonds were increased, while investments
in Treasury notes were reduced. The member banks also
added substantially to their investments in municipal and
other non-Government securities - $4,832,000, or 2.6 percent_
Deposit trends between July 22 and August 19 included a
decline of $20,058,000 in demand deposits and an increase
of $3,999,000 in time deposits, with the resulting net reduction amounting to less than one-half of 1 percent. Demand
deposits of individuals, partnerships, and corporations reGROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS
Elevenlh Federal Reserve District
(Averages of daily figures. In thousands of dollars,
COMBINED TOTAL
Dote
J~y

Gross
demond

Time

1951 ..... $5,855,513 $673,533
July 1952 ..... 6,566.056 74'.250
March 1953 ... 6,822.777 829.]'12
April 1953.... 6.700,806 855,308
May 1953 ... • 6,'92,8-'8 877.764
June 1953 .... 6,523.407 891.731
July 1953 ..... 6,572,440 901,614

RESERVE CITY 8ANKS

Gross
demand

Time

$2,746,696 $376.455
3.147.075 408,616
3,25 1,351 '44,623
3,180,189 465.370
3.053,816 484,0' 1
3.106,229 492,9 83
3,152,963 495,431

COUNTRY BANKS
Gross
demand

$3,108,817
3,418,981
3,571,426
3,520,617
3,439,032
3,417,178
3,419,477

Time

$297,078
335,634
385,089
389,938
393,723
398,748
406,183

127

MONTHLY BUSINESS REVIEW
BANK DEBITS, END-Of-MONTH DEPOSITS
AND ANNUAL RATE Of TURNOVER Of DEPOSITS
(Amounts in thousands of dollars)

DEBITSl

DEPOSITS:

Percentage
c;honge from

July

City

1953

July
June
1952 1953

Annual rate of turnover

July 31 ,
1953

July
July June
1953 1952 1953

On August 14 the Secretary of the Treasury announced
that holders of $2,788,000,000 of the 2-percent certificates
of indebtedness maturing August 15 accepted the new 2%percent certificates which were offered in exchange. The maturing issue was outstanding in the amount of $2,882,000,000. The 2o/s-percent certificates are dated August 15, 1953,
and mature August 15, 1954,

ARIZONA
Tucson •• . •.•.• . . . • .. $
LOU ISIANA
Monroe •.•.•.••••• ••
ShreYeport •••••• • •••

104,125

12

-I

81,432

14.5

13.4

14.4

.49,0.43
191,859

7

-2

2
-4

38,387
162,492

15.5
14.2

14.8
14.4

15.1
14.6

2.4,338

18

27,027

10.7

10,3

10.3

51,674
1
I
130,569
-7 - I
110,295
12
-5
131,308
1
7
157,515
12
3
1
12,573
B
1,656,056
15
2
199,013
15
3
512,608
- I -21
76,350
1
-3
1,662,377
6
-3
19,01.4
-7 -5
92,086 -12
-4
.46,960
9
-8
4
-6
37,.456
10
-3
395,.475
19,511
.4
-5
58,233
9
3
7.4,930
11
-5
82,13.4 -10
-1

50,207
103,585
97,900
92,185
106,765
19,716
867,139
115,318
331,739
82,885
1,044,750
18,278
75,458
36,988
.4.4,886
310,981
18,862
52,714
62,.475
97,305

12.2
15.0
13.3
16.9
17.4
7.7
22.9
20.3
18.4
11.2
19.0
12.2
14.0
15.2
10.0
1.4.9
12.2
13.2
1.4.5
10.1

11.9
16.3
12.8
16.7
17.2
7.0
20.3
18.2
19.4
13.9
19.1
12.5
15.0
13.8
9.5
1.4.5
12.5
12.6
13.3
11.8

12.2
15.4
13.8
16.3
16.7
7.7
22.1
19.8
23.4
11.9
19.6
12.7
14.2
16.4
10.6
15.2
11.8
12.8
15.6
10.3

$3,939,.47.4

17.8

17.3

18.2

NEW MEXICO
Roswell • . •••••••••••

TEXAS
Abilene •...•.. . .•.••
Amarillo ••• . . . •• .. • .

Austin ••• • ••..... . . •
Beaumont •• .. •••. . • .

Corpus Christi ••... .. •
Corsicana •••.••• .. . •
Dallas •••••••• • •••.•

EI Paso •••••..••••.•
Fort Worth ••...•.•.•
Golvedon •••..••••..
Houston ••• . •••••••••

L<Hedo •••••••••••••
lubbock ••••••••••••
Pori Arthur ••.... • •..
San Anglllo •••...•• ..
Son Antonio •••.•••••
Te)(Qrkana 3 •••••••• • •
Tyler •••.•.•••...• .•
WaCo ••...••••.•..•
Wichita Falls ••••.••••

Total-2.4 dties .• • •.•.• $5,895,502

7

-3

The build· up in stocks of major
refined products this summer as a
result of the sustained high rate of
refinery operations has caused somc
uneasiness in the oil industry. The
substantial year-to-year increase in the level of primary stocks
of major refined products at mid-August still may have been
distorted by the effects of the refinery strike of May 1952.
Nevertheless, gasoline stocks have declined somewhat less
than usual this summer, and distillate stocks on August 15
werc 25 percent higher than 2 years earlier, when there was
no refinery strike to cloud the picture, Moreover, some softness is apparent in distillate prices on the East Coast; the
movement of distillates from refineries to secondary suppliers has lagged. Prices of gasoline and residual fuel oil,
however, have been firm, Crude stocks showed little change
during July and the first part of August.

I Debits to demend deposit eccounfs of individuals, partnerships, and corporations and

of states end political subdivisions,
1 Demond deposit eccaunts of individuels, partnerships, and corporations and of states
and poUtical subdivisions.
'These flgures include only one bank in Tea:arkana, Tea:as. Total debits for ott banks in
Texarkana, Toxes·Arkansas, including two banks located in the Eighth District, emaunted to
$ U,.486,OOO for the manth of July 1953.
I Indicetes change af le~ than one·half of 1 percent.

fleeted the principal change among the major deposit categories, declining $29,94.0,000, or 1.2 percent. Time deposits
of individuals and businesses rose $2,887,000, or about 1 percent. In meeting deposit withdrawals and increasing their
earning assets, the weekly reporting member hanks drew
down cash and balances in the amount of $46,150,000, or
3.4 percent_
Debits to deposit accounts reported by banks in 24 cities
of the District declined 3 percent in July, to a level which
is 7 percent above a year earlier, The decrease in the volume
of spending from June to July, as reflected by the reduction
in charges to deposit accounts, was fairly general over the
District. The annual rate of turnover of deposiLs was 17,8
in July, as compared with 18,2 in June and 17,3 in July 1952,

Refinery crude runs in the Nation continued at a very
high level during July and the first part of August, exceeding 7,000,000 barrels daily, In this District, however, a moderate cutback in refinery activity occurred, Average crude
runs per day of district refineries were an estimated 2,020,000 barrels in July, which was down 80,000 barrels from
the previous month; moreover, runs averaged slighLly lower
in the first part of August.
Concern over Lhe present level of refined products stocks
and the cutback in refinery runs in this District may have
influenced the Texas Railroad Commission to cut sharply
the September allowables, which were reduced 119,691 barrels daily from the mid-August level. Crude oil production
in the Eleventh District has shown an upward trend in recent
months, with the estimated output during the first half of
August amounting to 3,170,000 barrels per day, or about
21,000 barrels higher than in July and 159,000 harrels higher
than in August a year ago,
CRUDE OIL, DAILY AVERAGE PRODUCTION

NEW PAR BANK
The Spring Branch State Bank, Spring Branch Community, Houston, Texas, a newly organized, insured,
nonmember bank, located in the territory served by
the Houston Branch of the Federal Reserve Bank of
Dallas, was added to the par list on its opening date,
August 1,1953. The officers are: Harold Moon, President; A, W, Schmidt, Executive Vice President;
Thomas W, Lee, Vice President and Cashier; and
Lewis Dickson, Vice President,

(In thousands of barrels}

Change from
Area
ELEVENTH DiSTRiCT ••.••••••
Texes, •.• ,., .•.••••••••
Gulf Coast ••••••••••••
Wesl Tea:as •••••••••••
East TeJl:as (proper) •••••
Panhandle, •• ••...••.••
Rest of State ••••.••.•••
Southeastern New Mea:ico ••
Northern Louisiana ••..•. . •
OUTSIDE ELEVENTH DISTRICT
UNITED STATES, . ••.•• •••••

July
1953 1

July
1952%

June
1953 1

3,148.7
2,846.2
635 . 3
1,093.5
247,8
76.5
793.1
193.7
108.9
3,379,1
6,527.8

2,879 ....
2,602.4567.8
1,008.2
271.6
82.7
672.1
165.6
111.4
3,213.1
6,092.5

3,110.1
2,804.9
628.7
1,077.2
252.5
75,1
771.4
191.8
113.4
3,350.9
6,461.0

July 1952

269.3
2.43.8
67.5
85.3
-23.8
-6.2
121.0
28.1
-2.6
166.0
435,3

SOURCE5l 1 Estimated fram American Petroleum Institute weekly reports.
1 United States Bureau of Mines.

J""e 1953
38.6
.41.3
6.6
16.3
-4.7
1.4
21.7
1.9
-4.6
28.2
66,8

128

MONTHLY BUSINESS REVIEW

Crude oil production trends in the Nation continue to be
similar to those in the District. Daily average production in
the United States during the first half of August was 6,566,000 barrels, which is 38,000 barrels more than in July and
347,000 barrels more than in August 1952.
Imports of crude oil and refinery products, after averaging
more than 1,000,000 barrels per day during each of the first
6 months of this year, were at a lower rate during July and
the first part of August. Imports in the 2 weeks ended Au·
gust 15 amounted to 895,000 barrels daily, which is only a
little higher than in July and August 1952.
The large year· to· year gains in demand for refined prod·
ucts which prevailed during the spring and early summer
apparently have narrowed somewhat in recent weeks. For
instance, the estimated demand for the four major refined
products at refineries and bulk terminals in the 5 weeks
ended August 15 averaged 5 percent higher than a year
earlier, which compares with an estimated year·to· year gain
of almost 12 percent in the preceding 5 weeks.
Nevertheless, the total domestic oil demand for July
through next May may run 7 percent above year-earlier
levels, assuming a normally cold winter and a high level of
business activity, according to a recent estimate released
by an official of the Petroleum Administration for Defense.
Furthermore, in early August the Bureau of Mines revised
upward its January forecast of total demand for oil in 1953,
both domestic consumption and exports. The new forecast
reflects an increase of 5.2 percent over 1952 rather than 3.8
percent, as predicted earlier.
Although no marked increase has occurred in the number
of active drilling rigs since the rise in crude prices at midJune, drilling activity continues appreciably higher than a
year ago, when the steel strike forced the lay-up of some rigs.
Both The Oil and Gas Journal and World Oil have revised
upward their forecasts of the number of wells which will
be completed this year. The higher prices for crude and the
improvement in steel supplies are factors which are expected
to promote increased drilling.
Marketed production of natural gas in the four producing states lying wholly or partly within the Eleventh District - Louisiana, New Mexico, Oklahoma, and Texascontinued to expand during the first quarter of 1953, to
reach a new record high of 1,742 billion cubic feet. This
volume was 3.9 percent higher than in the previous quarter
and 5.1 percent above the first quarter of 1952. The four

states' marketed output in the first 3 months of this year
accounted for 78 percent of the national total.
While the year· to-year increase in marketed gas production of the district states in the first quarter of 1953 was
substantial, it was appreciably less than the 16.5·percent
rise during the previous year. The smaller rate of the yearto·year gain for the first quarter of 1953 reneets principally
a reduction in pipeline expansion during 1952, due in part
to materials shortages, and a negligible increase in consumption by industrial users in the Southwest, as compared with
a large increase in the previous year.
Employment trends in the five
states of the District appear to be
more or less contradictory. While
the total of nonagricultural wage
and salary workers rose 21,600 from
May to June, unemployment also increased. In Texas alone,
the unemployment total rose from 99,100 in May to 118,900
in June, principally because of the fact that high school and
college students entered the labor force and a number of
school workers and Federal Government employees were reo
leased from their jobs. Seasonal increases in labor require·
ments boosted total nonagricultural employment, but this
rise did not absorb completely the additions to the labor
force.
In the five states of the District, around 5,000 workers
were registered in both the transportation and public utili·
ties category and the service industries between May and
June, while mining and construction each showed gains of
more than 6,000 workers. The only major category experi·
encing a decline was government employment.
In the district states there has developed over the past
few months a lower rate of expansion in nonagricultural
employment than that which prevailed last year or early this
year. This is particularly evident in the June reports of the
state employment agencies. Whereas the May·to·June increase in the total of nonagricultural wage and salary workers was 41,900 in 1952, the increase in 1953 was only 21,600. Similarly, the rise in manufacturing employmeut from
May to June was 7,900 in 1952 but only 1,300 in 1953.
NONAGRICULTURAL EMPLOYMENT
Five Southwestern Slates l

Type of employment

NATURAL GAS, MARKETED PRODUCTION
lin millions of cubic feet)
Fint quarter

First quarter

State

1953

1952

1952

Louisiana • •• ••••••.••••••••••. •

New Mexico •..................
Oklahoma •••••......•........ .
Texas . ... .••............... . .

307,400
98,600
171,500
1,164,700

276,600
93,800
192,700
1,094,500

342,200
92,100
154,500
1,105,200

Total.......... . .... .. .. ....

1,742,200

1,657,600

1.676,000

SOURCE: United Sta'es Bureau of Mine •.

Fourth quarter

Percent change
June 1953 from

Number of persons

J",.

Jun.

May

June

May

1953p

1952

1953

1952

1953

3,768,800
693.500
3,075,300
229,300
294,200

3,845.900
724.100
3,121,800
230,200
285,300

2.6
4.6
2.2
3.1
-.9

.6
.2
.7
2.6
2.2

408.200
949,800
139,100
"'44.400
610,300

404,900
976,100
147,700
454,200
623.400

.5
3.1
7.2
3.3
1.1

1.3
.3
.9
1.0
-1.0

Total nonagrieultural
wage and sa lary workers .. 3,867,500
Manufacturing . ..........
725.400
Nonmanufacturin; ...... . . 3,142,100
Mining ............... .
236,300
Construction . . . ........
291,600
Transportation and public
utilitiel . . . •...... . . . .
41 0,100
Trade .... .. ...... . . . .
979.200
Finance . ..............
149,100
Sel"o'iee .... . ......... .
458,900
Go... emment ...........
616,900

I Ari;r.ono, louiJiana, New Mexico, Oklahoma, and TeJoas.
p-Preliminory.
SOURCE: State employment agencies.

MONTHLY BUSINESS REVIEW

129

BUILDING PERMITS

NONAGRICULTURAL WAGE AND SALARY WORKERS
Ark ansas, LouIsian a, New Mu ico, Oklahoma, and T exo s

7 months 1953
Pertentage
change in
'Valuation from

TOT AL

Percentage

change in
valuation
from 7
months

July 1953
J~y

City

Number

LOUISIANA
Shreveport . ...

19~ 1

3,600

3,400 J...... ..

.' -r

M

...-..... - ....
I
·1 I T
A

ThollSQ d

•

I
I

I
I

A

o

f Per

I
I
N

3,600
0

Thou sand, of PU!OtIS

800f--+_+--+---1

MAN UFACT UR ING

11--+_-+_+--1

800

750~-+-~-+--f--'--r1 -,-~-+--f--+---1 750

I
I ____ --t:~'~'::t::j:::t~t.:::t::t~~~t:::t::t~
___ __ __ - ,;;;;-- I
..............
70 0
~

700

~

650 f-~.;i~.5~1.-.~..4r-...~..~.. :~..."'..~~·~+··~··~··4·-1-··-···~··~··-··-·+--+-~~f-~650
I . -~
I A-~M~~--+-~
I
I A-~-+
I
I
600J'-~-~
O--N~-+O~J600
SOUfIICf : $'1 1,

'/!lP !CtPl\ I~ 1

Valuation

Jun.
1952 1953 Number

362 $ 1,538,244 -20 -28

TEXAS
Abilene ....• •
63
Amarillo .• • ..
200
Austin •..... .
250
Beaumont • .. .
215
Corpus Christi.
518
Dalta s......• 2,009
EI Paso .. . ...
261
Fori Worth .• •
870
Golveston • ••.
118
Houston •• .•• . 1,020
lubbock ••• • .
206
Port Arthur • • •
111
SOl1 Antonio . . 1,477
WaCo . ... . . •
351
Wichita Folts .•
91

355,947
1,628,734
1,790.500
242,285
2,451,621
9,099,773
1,041,528
3,835,209
130.880
9,649,120
962,114
162,143
4,316,452
1.176,756
691,535

Total • .•... •..• 8,122 $39,072,841

-28
-31
-25
-38
116
-48
7
7
-51
-7
-63
-63
70
-37
-62

-76
57
-21
-55
49
7
-33
-30
-28
-55
-27
-57
-3
-4
23

-23 -28

1952

Valuation

2,447 $ 14.409,933
772
2,132
1,768
1,582
3,268
12,995
2.246
5,836
660
7,454
1,893
1,031
12,143
2.395
446

6

5,256,525
13,550,631
17,818,944
4,576,459
17,911,750
65,148,037
14,737,089
28,193,529
3,793,969
82,039,SO.411,040,277
1,945,331
31,762,232
6.936,215
4,708,533

-9
-11
2
-20
28
-1
45
-5
17
29
-4
-20
15
-26
-71

59.Q68 $323,829,258

4

GRI Mlfl.

Conversely, June 1953 unemployment in Texas (unem·
ployment figures for the other states of the District are not
availahle) was higher than in June 1952, and the rate of
increase from May to June also was larger. Unemployment
in the State increased 12,800 from May to June in 1952
but rose 19,800 in the same period this year. In June 1953,
unemployment in Texas represented 4. 3 percent of the total
nonagricultural labor force, compared with 3.8 percent a
year earlier. While the nonagricultural labor force in the
State increased 3.4 percent from June 1952 to June 1953,
unemployment rose 17 percent, despite the fact that a year
ago there wcre many persons unemployed because of major
strikes.
Total nonagricultural employment in district states is ex·
pected to make further seasonal advances in September, part·
ly as a result of the rehiring of school workers. Net changes
in unemployment will depend largely on the number of stu·
dents withdrawing from the labor force; an offsetting factor
will be a further decline in Federal Government employ·
ment. It has been estimated that nearly 11,000 employees
will be taken off the Federal Government payroll as economy
measures are effected in the four·state area of Arkansas, Lou·
isiana, Oklahoma, and Texas. There are approximately
201,000 Federal employees in this area at the present time.

the total reported for June and 18 percent less than in July
1952. July is the fifth consecutive month to show a year·to·
year loss. However, contract awards in August may show
an increase over those for the previous months. Contracts
were a warded during August for two multimillion·dollar
buildings in Dallas - the Statler Hotel and the Oil Center
- while throughout the District there has been considerable
letting of contracts for schools and commercial buildings,
street and highway improvement, and municipal water facili·
ties.
Perhaps the most significant development in the construction picture in July was a drop of 25 percent in awards for
residential building. During the first 6 months of this year,
awards for residential construction in the District about kept
pace with last year's high leveL
Construction contract awards for the first 7 months of
1953 were valued at an estimated $705,000,000, or 17 per·
cent less than in the same period last year. Residential
awards, reflecting the sharp decline in July, totaled 6 percent
less than a year ago. Nonresidential awards were under the
year-earlier total by 25 percent, mainly because of the decrease in awards for construction of utilities and of manu,
facturing and certain institutional buildings.
COTTONSEED AND COTTONSEED PRODUCTS

The value of construction contracts awarded in the Dis·
trict during July, about $94,000,000, was 7 percent less than

TEXAS
August

VALU< OF CONSTRUCT ION CONTRACTS AWARDED
(In thousands of dollars)
January -

July
1953

A.rea and type

93,576
33,757
59,819
UNITED STATES'", . . . 1,793,342
653,407
Residential . . , . . ' .. .
All other ... ... ... . . 1,139,935
ElEVENTH DiSTRiCT ....
Residential . . . .. ... .
All other ...... . .. , .

$

July

Jun e

1952

1953

113,723 $ 100,691
43,307
45,141
70.416
55,55 0
1,511,285 1,115,509
608,078
463,084
903,207
652,425

1 37 states eosl of the Rocky Mountains.
SOURCE: F. W . Dodge Corporation.

1953

July

1952

7 0 5,006 $ 853,006
321 ,51 2
342,175
383,494
510,831
9,701,180 9.269,863
3.911.903 3.952, 115
5.789,277 5,317.748

UNITED STATES

1 to June 30

August I fa June 30

Item

This season

Last seoson

This seoson

last seoson

COnONSEED (Ionl)
Received at mills .... ... . ..
Crushed ..•........ . .•. . . .
Stocks, end of period ••• • • ..

1.393,185
1,420,337
4S,100

1,367,586
1,455,134
30,433

5,540,583
5,371,059
197,208

5.390,552
5.348,824
176,112

Production
Crude oil (thousand pounds)
Cake and meal (tons} .....
Hulls [tonsl ......... . . • ·
Linters (ru!"lning boles) . . . •

468,949
688.767
331,713
402,490

469,371
698,009
332,812
433.746

1,756,604
2,580,207
1,159,370
1,715,603

1,704,434
2,487.017
1,205,249
1,707,044

Slotks. end of period
Crude oil (thousand pound s)
Coke and mea l (tons) • ... .
Hulls (tons) . • . ... • ......
linters (running boles) . • ..

4,766
53,489
13,808
20,551

6,367
15.903
S,359
33.564

32,011
122,619
67,992
88,069

24,549
58,946
30,676
148,066

COnONSEED PRODUCTS

50URCE; United Stotes Bureau of the Census.

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