Monthly Business Review OF THE FEDERAL RESERVE BANK OF DALLAS • (Compiled February 15, 1937)

======Volume 22, No.1 Dallas, , March 1, 1937 This eopy is released for pub- March 2 Heatlon in afternoon papers- ~~======DISTRICT SUMMARY

January valuation of building permits issued at fourteen THE SITUATION AT A GLANCE cities reporting to this bank, although 10 per cent below Eleventh Foderal Reserve District the previous month, was 29 per cent above the aggregate January Change from 1037 Dec., 1036 for the same month last year. debits to individual accounts (at 18 cities) ..... , , , . , ~'nk 5805,805,000 - 6 . 2 ~ IVti~en t stor~ . alcs ... . '.. , , ...... - 56 .0 Reserve balances of member banks in this district, after R Ie trado sales (6ve lines) ...... + 5.5 0 Vfrye bank loans to momber banks at end of month ... . i " .. '2'1',872 +S18,707 reaching a record total of $173,905,000 at mid-January, de­ e a uation of building permits (14 cities) ...... $ 5,524,395 - 10 .2% creased approximately $13,000,000 during the subsequent e~~~~~o! al fa!lurCII (~u~9c.r) ...... •...... 11 - 2 Oil OIal failures (liab,lit,es) ...... $ 42,000 - $1 20,000 two weeks, but by February 15 they had risen to $169,- production (barrels) ...... 44,094,050 + 3.8% 061,000. At the weekly reporting member banks in leading ------cities, loans and investments declined $28,094,,000 in the four weeks ending February 10, reflecting a net reduction Notwithstanding the deterr.ent effects of adverse weather of $11,822,000 in investments and a contraction of $16,- conditions, general business activity in the Eleventh District 272,000 in loans. As compared with February 12, 1936, ?uring January was substantially higher than in the open­ there was an expansion of $23,589,000 in loans and an l~g month of the preceding year. The volume of merchan­ increase of $32,501,000 in investments. The daily average dIse distribution at wholesale, although showing less than of combined gross demand and time deposits of member the usual increase from December to January, exceeded banks was $14,657,000 lower in January than in December ~at of the corresponding month last year by 14 per cent. but exceeded the average of a year ago by $173,082,000. etail trade, as reflected by sales of department stores in larger cities, decreased 56 per cent from the large December Weather conditions during January were unfavorable volume, but registered a gain of 12 per cent over January for the agricultural and livestock industries. Farmers have ~ast.year when there was one additional shopping day. Bank made poor. to only fair progress with winter plowing, and ebits at eighteen cities, which were seasonally 6 per cent land preparation is very backward with the spring planting smaller than in December, reflected an increase of 19 per season close at hand. Small grains continue in fair to good Cent over the same month last year. condition, but to stimulate plant growth rains are needed in the western portion of the district and sunshine in other E The valuation of construction contracts awarded in the areas. Ranges reflected a general decline during the month .leventh District, as reported by the F. W. Dodge Corpora­ and livestock showed some shrinkage, yet conditions in most hon, rose 4, per cent from December to January, but fell sections remained above the average. The Department of 13 per cent under the total for January, 1936. Residential Agriculture reported that prospects for spring grazing are nontracts awarded had a value 11 per cent higher than in good and that the outlook for the industry in most sections ecember and 25 per cent higher than a year ago. The is favorable. BUSINESS fl7h olesale Buying at wholesale through the five lines a gain of 13.7 per cent over a year ago and 5.5 per cent Trade of trade surveyed by this bank continued over the previous month. in good volume during January despite the retarding effects of the adverse weather prevailing during Reflecting a strong demand by retailers for early spring mUch of the month. Sales in all lines remained appreciably merchandise, the sales of wholesale dry goods firms in this :bove those in the corresponding month a year ago, ranging district during January rose 61.9 per cent above those in rom 3.0 per cent in the case of drugs to 22.0 per cent in December, and were 14.2 per cent greater than in January, the case of hardware. Total sales of reporting firms showed 1936. The business of wholesale grocery firms was likewise

This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library ([email protected]) 2 MONTHLY BUSINESS REVIEW heavy in the past month. The increase in sales, which was both to the higher prices of commodities and the larger general over the district, averaged 8.9 per cent as compared volume of goods. A general increase was reflected in the with the preceding month, and 18.6 per cent as compared collections on accounts by wholesale drug firms, but in other with the January, 1936, volume. The latter gain is the largest lines of trade payments evidenced a seasonal recession. for that comparison in recent months. The demand for hard­ ware at wholesale declined somewhat more than seasonal Retail Consumer demand for merchandise at during January, due in part to the retarding effects of un­ Trade department stores in eleven of the larger favorable weather conditions upon building and other out­ cities of this district during January con­ side activities. Sales averaged 4.7 per cent less than in tinued to show a wide margin of gain over the correspond­ December, but continued 22.0 per cent above those in the ing month of the preceding year. This increase was sig­ like month a year ago. The distribution of drugs evidenced nificant in view of the fact that the weather prevailing dur­ a recession of 11.8 per cent from December to January, ing a considerable portion of the month was unfavorable which is partially accounted for by a reduction in the for shopping. Total sales of reporting firms were seasonally demand for liquors. An increase of 3.0 per cent was reg­ 56.0 per cent smaller than in the preceding month, b~t istered as compared with sales in January, 1936. Following exceeded the volume in January, 1936, which had one addI­ the record-breaking demand for farm implements during tional business day, by 11.7 per cent. Based on daily average the past few months, sales fell off somewhat in January sales, business in January was 16.2 per cent greater than and reflected a contrary to seasonal decrease of 9.8 per in the like month a year ago. cent. Notwithstanding this decline, sales remained at a com­ Inventories of department stores declined 1.0 per cent paratively high level and were 16.9 per cent greater than in in January, which was seasonal, and reflected the clearance the same month last year. of winter merchandise. Stocks at the end of the month, hoW­ The dollar value of inventories on hand was ever, were 13.6 per cent larger than on the same date in larger than a year ago in all reporting lines of trade, due 1936. The rate of stock turnover was .26 in January, which was the same as that in January last year. CONDITION OF WHOLESALE TRADE DURING JANUARY, 1937 Collections on open accounts during the past month evi­ Percentage of increaso or decreaso in- denced more than the usual seasonal recession, declining Net Sales Stocks Ratio Jan. January, 1937 Jan. 31, 1937 collections from 44.7 per cent in December to 41.3 per cent in J anU­ oompared with compared with to accounts Jan. Dec. Jan. 31, Dec.31, outstanding ary. The latter figure compares with a ratio of 39.9 per cent 1930 1930 1936 1030 Dec. 31 in January, 1936. The ratio of January collections to in­ Groceries ...... +18.0 + 8.9 +19.4 + 5.2 89.4 Dry goods ...... +14 .2 +0l.9 +22.0 +19.5 36.6 stallment accounts outstanding on was 14.7 per Farm implements ...... +16.9 - 9.8 + 2.2 - 6.7 7.7 cent as compared with 16.1 per cent in December, and 14.9 Hardware ...... +22.0 - 4.7 +10.2 +15.4 50.6 Drugs ...... + 3.0 -11.8 +15 .9 + 3.9 09.2 per cent in January last year.

BUSINESS OF DEPARTMENT STORES - Total sales (percentage): Dallas Fort Worth San Antonio Others Total District January, 1037, compared with January, 1930 ...... +11.5 +12.1 +13.0 + 7.4 +13.9 +11.7 January, 1937, compared with December, 1930 ...... -53.8 -03.5 - 55 .0 -52.6 - 57.0 -56.0 Credit sales (percentage): January, 1937, compared with January, 1936 ...... +14.0 +14.0 +18.5 +17.0 +12 .0 +15.3 January, 1937, compared with December, 1930 ...... -40.7 -04.9 -49.5 -49.4 -55.1 -52.8 Stocks on hand at end of month (percontage): January. 1937. compared with January, 1930 ...... +16.0 - 2.2 +10.0 +16.5 +10.5 +13.6 January, 1937, compared with December, 1930 ...... - 3.4 - 1.4 - 9.1 + .7 + 6.4 - 1.0 Stock turnover (rate): Rate of stock turnoverin January, 1930 ...... 30 .21 .26 .28 .22 .26 Rate ofstock turnov~r in January, 1937 ...... 28 .23 .27 .20 .22 .20 Ratio of January collections to open accounts roceivable and outstanding January 1, 1937 ...... 40.3 33.7 43.0 45 .8 43.5 41.3 Ratio of January collections to installment accounts receivable and outstanding January 1, 1937 .. . 10.0 10 .2 12.~ 18 .8 14.7 Indexes of department store sales: 183 .1 204 .4 170.4 149.4 175.4 85.8 75 .9 78 .4 71.2 78 .1 114.4 115.5 107.0 90.4 107.6 ~~~§~~Wgt~~~?~\ ~: ~ ::~: ::: : ~::: ::~ :: ::: ~: : :::: :: :::: :: :: :: ~::::::::: :: ::: 99 .8 102.0 88.1 78 .2 93.0 Indexes of department store stocks: 58.2 55.2 30.3 53.0 57 .1 H~~::!;:l=ra,::,~::ri9~~~~ ::: : : ::::: : :: :: : : ::: : : : :::: :: : ::: :: : : : : :: ::: ::: : ::::: ::::: 50 .6 50 .7 41.7 55 .4 57 .8 Adjustod-December, 1936 ...... 00.1 07 .3 42 .3 69 .6 65.6 Adjustod-January, 1937 ...... 65.1 05.9 48 .5 60.2 66.4- Commercial An improvement in the business mortal­ month and 39 bankruptcies in the same month last year. Failures ity rate in the Eleventh Federal Reserve Liabilities of firms defaulting during the month totaled District during January was reported by Dun and Bradstreet, Incorporated. There were 11 failures only $42,000, which compares with $171,000 in December in January, as compared with 13 insolvencies in the previous and $339,000 in January last year. AGRICULTURE

Crop Con­ Field work in the major portion of the tion for spring planting is very backward. In much of the ditions Eleventh District has been greatly re­ eastern half of the district excessive rains accompanied tarded since the first of the year on ac­ by cloudy weather have kept the soil too wet for plowing· count of unfavorable weather conditions, and land prepara- Recently farmers have made some progress with plowing MONTHLY BUSINESS REVIEW 3

?n uplands, but the bottom lands are still wet. Operations RECEIPTS FROM THE SALE OF PRINCIPAL FARM PRODUCTS In the western portion of this district have been delayed by (In thousands of dollars) the dry, cold weather. Receipts from: Farm Livestock and Iivo­ Total crops stock products receipts Although small grains show the effects of the adverse State 10S6 1035 1036 1035 1036 1035 Weather prevailing during the past six weeks, these crops Arizona ...... $ 21,806 $ 24.020 $ 22,240 $ 24,508 $ 44,055 S 48, 61 8 are in fair to good condition in most sections except the Louisiana. , ...... 82,608 77,240 17,354 20,417 00,062 07,066 Oklahoma ...... 40,043 57,716 82,677 82,762 131,720 140,478 Texas Panhandle and eastern New Mexico. In the latter New Mexico ...... 13,138 0,221 28,150 26,560 41,207 35,700 areas, the dry winds and the deficiency in both surface and TellIS ...... 257,760 211,245 145,663 138,037 403,432 340,282 su~soill11oistu r e are causing deterioration in the wheat crop. Total five states ...... 1424,364 $370,451 $206,102 $202,383 $720,466 $671,634 ThIs situation is being aggravated by the recurrence of dust SOURCE: United States Department of Agriculture. storms which are causing some shifting of soil. Heavy rains are urgently needed in these areas and would be beneficial Livestock Despite the general decline in the con· to most of the western portion of the district. dition of ranges and livestock in this COlmllercial vegeLable crops made good progress in Jan· district during January, the outlook for the livestock indus· Uary. M:oisture has been ample in all portions of the truck try was reported by the Department of Agriculture to be growing area except the Coastal Bend district, and crops favorable in most areas. Cattle ranges in Texas declined 4 ?ave escaped damage from the low temperatures. The plant· points in January, but the 77 per cent of normal condition Ing of tomatoes and potatoes in the Lower Valley was obtaining on February 1 was the same as a year earlier practically completed by February 1 and these crops are and 2 points higher than the ten·year average. The decline getting an early start. Conditions generally are favorable in west and northwest Texas was due to the dry, cold for the planting of other spring crops. weather, and in the other portions of the State it resulted from the wet weather and lack of sunshine which caused CONDITION OF COMMERCIAL TRUCK CROPS IN TEXAS matured grass to decay. In New Mexico, the 75 per cent February 1, 1037 February 1, 10S6 January 1, 1037 condition of ranges on February 1 was 1 point lower than (Per cent) (Per cent) (Per cent) ~ccts ...... 83 76 86 a month earlier and 11 points below that on the same date C~~li...... ~~ 70 83 in 1936. The condition of sheep and goat ranges in Texas 80 82 ga~reJ~: : : : : : : : : : : : : :: : : : : : : : 81 80 78 was rated at 81 per cent of normal on February 1 as com· p:ll~ Bermuda ...... ~~ 83 81 SPin~ehnghsh ...... 70 70 pared with 86 per cent on January 1 and 80 per cent on St ...... 60 66 60 T rawhorric...... 82 86 February 1 last year. Although the January freezes killed u'nips ...... 77 si 87 the green grass and weeds which were furnishing good graz· SOURCE: United States Department of Agriculture. ing for sheep, ranges carry a good supply of matured grass. The February 1 report of the Department of Agriculture Livestock showed some shrinkage in January due to the stated that the weather during the winter had been very cold, wet weather, but the loss in flesh was comparatively favorable for citrus fruits in Texas. The temperature aver· small and animals are in generally good condition. Losses aged above normal, and the ample supply of moisture of cattle and sheep were light, and losses of calves and helped the trees to carry the large crop of fruit. The quality lambs were confined largely to new·born animals in the of the fruit was reported to be excellent. The indicated regions where the weather was most seVere. Supplemental production of oranges was placed at 1,800,000 boxes on feeding was necessary in some sections during the severe February 1, as compared with 1,600,000 boxes on January weather. Feed supplies are ample in most sections to carry 1 and a harvest of 74.7,000 boxes in the previous season. livestock through the winter. The February 1 condition of Although the estimated production of grapefruit remained cattle in Texas, as reported by the Department of Agri· unchanged at 6,790,000 boxes, the report stated that the culture, was 79 per cent of normal as compared with 84 frUit is "sizing" better than growers had expected. per cent on January 1 and 81 per cent a year ago. Sheep and goats in Texas declined 3 points in January, and the Cash Farm According to ·the estimate of the United February 1 condition figure was 1 point lower than on the Income States Department of Agriculture, reo same date last year. In New Mexico the condition of cattle ceipts from the sale of principal farm and sheep dropped 2 points between January 1 and Feb· products in the five states wholly or partially attached to ruary 1 and on the latter date was considerably lower than ~he Eleventh District amounted to $720,4,66,000 in 1936, an a year earlier. Tcrease of 7.2 per cent over the estimated total for 1935. he income from the sale of crops increased 11.8 per cent, Movements The January receipts of sheep at the Fort and the receipts from the sale of livestock and livestock and Prices Worth market were nearly double the products rose 1.3 per cent. In Arizona and Oklahoma, total December supply, the increase being con· Income was lower in 1936 than in 1935. Due to the larger siderably larger than the average for that season. The supply receipts from the sale of both crops and livestock products, was also sizably larger than a year ago. The arrivals of total income showed a gain of 15.4 per cent in New Mexico cattle and calves reflected a seasonal decline from December and 15.5 per cent in Texas. In Louisiana, the increase in and were smaller than in the same month last year. Contrary ~otal receipts was only 2.4, per cent as the gain in income to the usual trend, hog receipts decreased from December rom the s/1.1e of crops was nearly offset by a decrease in to January, and fell considerably below those in Jan· receipts from livestock and livestock products. uary, 1936. . Government payments in these states totaled $47,699,000 The cattle market held generally steady in the last half In 1936 as compared with $120,392,000 in 1935. of January; declined in the first week of February; and 4 MONTHLY BUSINESS REVIEW

then advanced in the subsequent week. Although quality slightly lower than a month earlier. There was a good offerings were scarce, the available supply was in good de­ demand for lambs, and prices showed an upward trend. mand. Hog prices showed considerable fluctuation during the period, but at the middle of February they were only COMPARATIVE TOP LIVESTOCK PRICES (Doll ars [X'r hundrodwcight) FORT WORTH LIVESTOCK RECEIPTS January January December (Number) 1037 1030 1036 Boef steers ...... S 9.75 S 9.35 S 0.00 January January Chango over December Change over Stooker steers ...... 7.15 7.00 7.35 1937 1986 year 1936 month Heifers and yearlings ...... 0.85 9.50 11.00 Cattl...... 51,324 73,247 -21,023 60,385 - 0,061 Butoher cows ...... 6.00 6.00 6.00 Calves ...... 20,814 31,105 - 1,201 43,868 -14,054 Calves ...... 7.05 7.00 7.60 Hogs ...... 37,672 44,068 - 6,306 43,626 - 5,954 10 .35 10 .25 9.05 Shoop ...... 34,526 20,727 + 4,709 18,543 +15,083 ~b.;:::: : ::: ::: :::::::: :: ::: : :: : :::: :: :::::: :: 10 .00 10.00 8.25

FINANCE

Operations of On the Board of Governors CONDITroN OF THE FEDERAL RESERVE BANK of the Federal Reserve System announced (In thousands of dollars) the Federal Re­ February 15, February 15, , serve Bank a further increase of 33 1/3 per cent in 1037 1036 1037 the reserve requirements for member Total cash reserves ...... $104,213 $142,111 $101,604 Disoounts for member han ks .... " ...... 41 80 None banks, one-half of the increase to become effective as of the Other bills discountod ...... None None None Industrial ad vano...... " . 1,200 1,735 1,3~~ opening of business on March 1, 1937, and the remaining Bills bought in the o[X'n market ...... 86 133 United States Government seouriti es owned .. . . 04,006 85,000 05,01~ half to become effective as of the opening of business on All other investments ...... 3 10 May 1. Total carning assets ...... 06,395 80,907 96,422 M.mber hank reserve deposits ...... 169,061 132,040 178,005 Foderal Reserve notes in aetual circulation .. . . 87,784 72,505 88,742 In a statement released to the press on the following day, Commitments to make industrial advances . . . . 486 500 480 the Board said in part: ------"By its present action the Board eliminates as a basis Condition of The loans, investments, and deposits of of possible credit expansion an estimated $1,500,- Member Banks reporting member banks in leading cities 000,000 of excess reserves which are superfluous for the in Leading showed substantial decreases between present or prospective needs of commerce, industry, Cities Janua.ry 13 and February 10. Holdings of and agriculture and which, in the Board's judgment, direct obligations of the United States would result in an injurious credit expansion if per­ Government, after reaching a new high level on January mitted to become the basis of a multiple expansion of 27, reflected a sharp decline during the subsequent two weeks bank credit. and showed a net decline of $5,526,000 for the period. In' vestments in fully guaranteed obligations evidenced a fur· "All but a small number of member banks" (in the ther reduction of $9,314,000. Holdings of other securities United States) "have more than sufficient excess re­ were increased $3,018,000. During the four weeks loans o~ serves and surplus balances with other banks to meet securities declined $827,000 and "all other" loans (agrI' a 33 1/3 per cent increase in reserve requirements. cultural, commercial, and in d ustria 1 loans) reflected 8 further recession of $15,445,000. Total loans and invest­ "It is the Board's expectation that, with approxi­ ments of these banks aggregated $488,54,0,000 on February mately $500,000,000 of excess reserves remaining with 10, which was $56,090,000 higher than a year earlier. Be­ the banks, credit conditions will continue to be easy. tween and February 10 adjusted demand de· At the same time the Reserve System will be in a posi­ posits declined $6,14,2,000 and time deposits dropped $325, tion to take promptly such action as may be desirable 000. During the same period there were withdrawals of to ease or tighten credit conditions through open­ $8,926,000 in United States Government deposits and $3, market and rate policy." 555,000 in interbank deposits. Balances with other banks In the Dallas district, member bank reserve balances were increased $12,502,000. Reserves with the Federal Re· averaged $165,182,000 in January, which was 60.4 per cent serve Bank showed a decline of $2,820,000 from the high larger than average required reserves, and in the first fifteen level reached on January 13. days of February average balances maintained by these CONDITION STATISTICS OF MEMBER BANKS IN LEADING CITIES banks rose to $167,579,000. (In thousands of dollars) February 10, February 12, January 13, Federal Reserve notes in actual circulation reflected a 1037 1936 1037 Unitod States seourities (owned) ...... $102,804 $147,502 $108,300 further decline of $958,000 between January 15 and Feb­ Securities fully guaranteod by Unitod States ruary 15, but the total of $87,784,000 on the latter date was Government (owned) ...... ' ...... 30,120 50,003 39,443 All olher stocks, bonds, and seouriliC8 (ownod) . 55,478 48,375 52,400 $15,279,000 higher than a year earlier. Discounts for mem­ Loans on seourities ...... 45,004 42,020 46,821 All other loans ...... 164,075 144,400 170,520 ber banks at the middle of February amounted to only Totalloaas ...... 210,009 186,480 226,341 Demand deJ>08its- adjustod" ...... •. 386,667 323,824 302,809 $41,000. Industrial advances outstanding totaled $1,299,000 120,814 119,760 121,139 on February 15, a decline of $11,000 as compared with a t::rt~ff'1rat~Go~e~~;ne ni depoolt:s·.: :: : : : : :: : 20,482 21,383 38,408 Interbank deposits ...... 198,165 187,135 201,720 month earlier and $436,000 as compared with the corre­ Balances with domestic banks ...... 184,761 186,268 172,250 Reserve with Foderal Reserve Bank ...... 107,082 76,357 109,002 sponding date in 1936. Total reserves of this bank rose to Bills payable and redisoounts with Foderal $194,213,000 on February 15, a new high level and gain Reserve Bank...... None None None "Demand deposits olher than interbank and Unitod States Government, loss cash items of $52,102,000 over a year ago. reporlod as on hand or in process of eolleotion. MONTHLY BUSINESS REVIEW 5

Debits to Although debits to individual accounts $11,057,000 at reserve city banks and $2,527,000 at country Individual at banks in eighteen cities in the Eleventh banks. The daily average of time deposits of these banks Accounts District declined seasonally from De- was $1,074,,000 lower in January than in December, the . cember to Janum'y, they continued rna- loss being about evenly divided between reserve city banks tenally higher than in the corresponding month of the and country banks. previous year. The month's total of $895,895,000 was 6.2 GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS per cent smaller than in December, but 18.7 per cent above (A vcr age of daily figures-in thousands of dollars) the figure for January, 1936. Combined Total Reservo City Banks Country Banks DEBITS TO INDIVIDUAL ACCOUNTS Gross Gross Gross (In thouSllnds of dollars) domand Time demand Time demand Time Month and Ycar doposits deposits dcposits deposits doposits deposits January Janunry Pctg. chango 1037 1036 ovor year 1036 ~~~:~:ttO January ...... $ 026,S04 1106,765 1523, 120 1110,051 $402,684 186,714 Abilone $ 7.660 1 7,304 + 3.6 S 0,306 - 17 .7 February .. , ...... 037,137 197,078 630,276 100,664 406,861 87,414 26,417 20,436 +20.3 30,677 - 13.0 Maroh...... 033,523 106,804 681,473 108,414 402,050 87,800 ~~;o'~'i::::: : ::::::::: 24,901 22,402 +11.1 26,637 - 2.6 tr,ril...... 027,028 106,675 627,743 107,660 400,186 88,016 D~IT~~na ...... 3,994 3,380 +17.0 4,028 - .8 ay ...... 026,927 104,602 520,858 107,863 307,069 86,829 264,167 218,013 +20.7 282,177 - 6.4 June ...... ,',., . . . , 048,130 106,703 640,068 108,065 402,181 88,638 ~ I ~W::::: :: ::: : :::::: 30,368 23,247 +30.6 20,486 + 3.2 July ...... , ,., .. , ..... 000,400 100,570 578,721 100,062 420,730 89,024 G~\v es~~th ...... 88,304 70,086 +11.8 05,067 - 7.9 August ...... , ...... 088,321 100,824 670,488 100,634 417,833 00,200 20,583 25,030 +14.1 32,624 - 0.0 September ...... , ...... 1,017,180 190,602 685,613 100,304 431,073 00,238 ~o~ston .... ::::: ::: ::: : : : 222,231 180,492 +23.1 233,876 - 6.0 October ...... 1,001,207 200,763 008,277 109,028 453,020 01,140 Ror ~rthur ...... 0,186 7,616 +20.6 0,001 + 1.0 November ...... 1,007,227 200,788 627,187 110,105 470,040 00,078 Ba~'i:nt)· :...... 3,600 2,721 +32.6 4,188 - 13 .8 December, , .. , .. , .. . , . .. 1,108,410 200,808 632,243 110,280 476,167 00,618 Sb DlO ...... 70,190 60,463 +1.1 76,262 - 6.7 1037 T rovOport...... : .. .. 40,000 37,184 31.8 62,605 - 6.9 January ...... , . .... , " 1,004,827 100,824 621,186 109,726 473,040 00,098 Toxarkana' ...... 0,163 0,670 :\:37.2 0,371 - 2.2 11,560 0,606 +20.3 12,707 - 9.7 14,138 12, 161 +16.3 16,037 - 11 .8 ADJUSTED DEMAND AND TIME DEPOSITS OF MEMBER BANKS ~~r:' ::::::::::::::::: 16,002 13,601 +16.0 17,125 - 7.1 ON SELECTED "CALL" DATES 10 Ita Falls ...... 16,333 14,323 +7) 14,822 +3.4 (In thousands of dollars) Total...... 1806,805 1764,731 +18.7 196'4,016 - 6.2 Combined Total Rescrvo City Banks Country Bankst -2nclud08 tho figures of two banks in Texarkana, ArkanSll8, located in tho Eighth District. Domand Demand Domand doposits Timo deposits Timo deposits Time Acceptance Acceptances executed by member banKS Call dates adjusted' deposits adjusted' doposits adjusted' deposits Market in this district and outstanding at the end Juno 30,1933 ... . : . . .. . ,. 1379,662 1180,863 1170,720 $114,301 $202,033 175,562 Deo. 30, 1033 .,.,.,',.... 444,205 100,000 104,014 107,407 240,201 82,503 of January totaled $1,553,736 as com­ Juno 30, 1034 , , . , . , . , . , . . 405,620 107,280 232,801 111,864 262,600 86,426 Dec. 31, 1934 . ... . ,',. ... 651,276 106,066 242,422 112,117 308,864 83,040 pared with $2,202,277 a month earlier. The volume of out­ June 20, 1036 . .... , , , , .. . 583,044 105,210 270,550 113,421 307,088 81,780 standing acceptances based on import and export trans­ Doo, 31, 1036 ...... , . . . 642,167 108,405 202,620 111,851 340,538 86,644 Junc 30, 1036...... 607,486 200,661 327,363 110,006 370,133 80,605 ictions increased from $4,83,04.5 on December 31 to $489,- 'Demand doposits other than interbank and United States Govornment, ICBS cash items in procCBS of colloction and, prior to Dcccmber 31, 1035, loss casb items reported on hand but not 4,8 on January 31, while those executed against the 1D prOCCBB of collection, domestic shipment and storage of goods declined from tOutlying banks in rcsorve cities whioh havo been authorized to carry country bank re­ serves arc inoluded with country banks, ~1,719,232 on the former date to $1,0640,588 on the latter ate. Savings Savings deposits reported by 117 banks Deposits of The daily average of gross demand' de- Deposits in this district totaled $155,037,4.95 on Member Banles posits of member banks, which reached a January 31, which was 0.3 per cent lower . high level in December at $1,108,4.10,000, than on December 31, but 4,,5 per cent higher than a year ~echned to $ 1,094~827,000 in January. Although the latter ago. The number of savings accounts at these banks in­ gure was $13,583,000 lower than that for the previous creased from 34,6,14,0 on December 31 to 348,623 on Jan­ month, it was $169,023,000 larger than the January, 1936, uary 31. The latter figure compares with 333,088 accounts average. The December to January decline amounted to at the end of January, 1936.

- SAVINGS DEPOSITS January 31, 1037 January 31, 1030 Deocmber 31, 1036

Number of Number of Amount of Number of Amount of Percentage c~ange Number of Amount of Porcontage cbango rc~rting savings SIlvin~ savings savin~ over year In savings 8nvin~s over month in anks dopositors doposlts depositors dcposlts savings deposits dcpositors doposlts savings deposits ~onumont ...... 3 0,306 3,620,776 0,017 3,637,709 + 2.3 8,078 3,663,800 - .0 Et~B8 ···· ···················· , . · . 8 SO,188 20,220,733 78,016 24,632,602 + 0.0 80,710 26,504,020 -1.4 Fort 'Worth' ...... ' 2 14,009 7,560,886 12,230 0,101,800 +24.1 13,840 7,530,671 + .4 3 36,664 12,541,021 34,500 11,518,177 + 8.0 36,600 12,538,750 .02 4 17,097 10,803,186 10,000 10,503,576 + 2.8 17,063 10,870,636 .2 10 09,420 28,136,887 66,040 29,255,060 - 3.8 68,070 28,464,001 -t 1.2 2 6,468 2,344,384 5,620 2,213,808 + 6.0 6,381 2,384,171 + .4 5 20,230 15,000,766 18,122 15,286,500 + 4.5 20,077 16,030,144 - ,5 3 23,801 11,341,730 22,420 10,320,566 + 0.0 23,884 11,276,973 + ,6 3 9,630 5,335,733 0,634 6,001,630 - 0.6 0,548 5,008,736 + 4.6 ~::: .:: 3,307,431 + 3,1 0,545 3,501,112 All otb Is ...... 3 0,604 3,408,764 0,280 - 2.6 era ...... • ...... •... . .• . 71 60,216 27,648,031 53,380 ---26,815,646 + 7,1 64,826 27,543,064 + .4 Total., ...... , ..... , .... 117 348,623 156,037,406 3S3,088 148,383,005 + 4.5 340,140 156,451,307 - ,8

- DISCOUNT RATES CHARGED BY MEMBER BANKS DURING FEBRUARY, 1037 Prevailing mtcs Dallas EI Paso Fort Wortb Houston Sail Antonio Waco RatoF~arged oustomers on primo commercial paper such as is now oligiblo for rediscount undor tho Rate h eral Reservo Act ...... , , . , . , , , ...... , . , .. . , ...... , ... , ...... , , , .. . 2-8 6-8 1 ~7 3-7 3-7 2-6 Rate e arged on loans to other banks secured by bills receivable . , . , ...... , , , ...... 4-6 6-6 6 6-0 . on tlohans secured by primo stook excbange or other currcnt collatoral (not including loans placed In 0 Dcr mnrkots tbrough correspondont banks): 4 0 4-10 3-7 6-6 6 Rate h Ti=n,~': ::::::::: :::: ::::::::: : :::::::::: :::: ::: : :::::::::: : :::: ::::: : ::::::::: H 6-8 4-10 3-7 6-7 6 Rato c arged on commedity paper secured by warehouBC receillts, etc ...... ••.... , , •• , , , ...•.... 2-8 6-8 6-8 2-7 6-8 5-8 _on cattlo loans .. , ...... ,', ...... " ...... , .. " .. ,', .... , ...... , . , ...... 6-8 6-8 6-10 7-10 6-8 8 6 MONTHLY BUSINESS REVIEW

INDUSTRY

Cottonseed The receipts of cottonseed at Texas mills Cotton The receipts of cotton at the ports of Products in January were 74.2 per cent smaller Movements Houston and Galveston were unusually than in December and 59.5 per cent small in January, the combined total for below those in January last year. Due to the small January the two ports reg~ stering a decline of 67.0 per cent from volume, total receipts for the first six months of the current the previous month and 57.4, per cent from a year earlier. season fell 3.7 per cent below those for the corresponding Exports reflected the usual seasonal decline from December period of the previous season. January crushings of cotton­ to January and were moderately smaller than in the same seed at these mills declined 20.4 per cent from December month last year. For the fi rst six months of the current and were 12.9 per cent ,lower than a year earlier. Shipments season, however, shipments from the two ports were in about of manufactured products from Texas mills reflected a sub­ the same volume as in the same period of the previous stantial decline as compared with the previous month, but season. they closely approximated the month's production. Stocks on hand at the mills on January 31 were considerably lower Exports of cotton from the United States in January than a year earlier, the decreases ranging from 12.5 per amounted to 538,280 bales, which represents a recession of cent for linters to 59.9 per cent for crude oil. At all United 9.4, per cent from the 593,860 bales shipped in December, States mills, the crushings of cottonseed and the production and a slight decline from the 542,776 bales exported in of products were moderately smaller in January than in January last year. Total exports for this season to January December, but continued approximately a fourth larger than 31 aggregated 3,4,35,082 bales as compared with 4,,003,597 a year earlier. bales during the same period last season. STATISTICS ON COTTONSEED AND COTTONSEED PRODUCTS Texas United States COTTON MOVEMENTS THROUGH THE PORT OF GALVESTON August 1 to January 31 August 1 to January 31 (Dales) This season . Last season This SOBSon Last SOBSon January January August 1 to January 31 Cottonseed received at mills 1037 1936 This season Last srason (tons) ...... 884,318 018,358 4,226,126 3,481,658 Receipts ...... 66,991 105,616 1,576,202 1,402,532 Cottonseed orushed (tons) ...• . 504,369 747,064 3,362,666 2,035,861 Exports ...... , .. 221,501 168,065 1,215,723 877,563 Cottonseed on hand Jan. 31 Stooks, January 31...... 723,038 749,622 (tons) ...... 80,825 102,806 885,386 635,372 Produotion of products: Crudo oil (pounds) ...... 226,663,685 210,451,042 1,003,457,068 882,025,512 Cake and meal (tons) ...... 370,015 343,068 1,500,002 1,324,216 Hulls (tons) ...... 214,372 201,287 858,480 755,918 COTTON-GALVESTON STOCK STATEMENT Lintars (running bales) ...... 173,041 146,245 817,763 661,462 (Blll es) Stocks on hand January 31: January 31, January 31, Crude oil (pounds) ...... 13,363,505 33,302,410 40,753,944 88,338,751 1937 1936 Cake and meal (tons) ...... 78,733 02,760 224,460 362,500 2,300 100,443 For Great Britain ...... , ...... 10,000 Hulls (tons) ...... 55,733 04,812 164,038 For France ...... , ... ~ ...... 7,000 5,600 Linters (running bales) ...... 61,151 60,006 200,036 201,687 For other foreign ports ...... , ...... 58,000 40,700 SOURCE: Bureau of Census, For ooastwiso ports ...... , ...... , 6,500 2,000 In oompresses and depots ...... , 641,538 699,022 Total...... 723,038 749,622 Textile Although the consumption of cotton by Milling domestic mills registered a counter-to­ seasonal decline of 2.1 per cent from COTTON MOVEMENTS THROUGH THE PORT OF HOUSTON December to January, the total for the latter month was (B ales) January January August 1 to January 31 14.8 per cent larger than a year earlier and set a new high 1937 1936 This season Last season record for that month. Consumption for January amounted Roooipts ...... 43,605 153,899 1,179,207 1,507,050 Exports ...... 120,130 202,577 820,784 1,154,646 to 678,064 bales, which compares with 692,921 bales in Stooks, January 31...... •.... 489,361 643,669 December and 590,4.84 bales in January last year. The aggregate for the first six months of this season reached 3,848,195 bales, which exceeds the 3,014,381 bales consumed SEASON'S RECEIPTS, EXPORTS, AND STOCKS OF COTTON AT ALL in the corresponding period of the previous season by 27.7 UNITED STATES PORT8-(Bales) August 1 to January 31 per cent, and is larger than for any similar period on record. This season Last season Stocks of raW cotton held by consuming establishments rose Rocoipts ...... ,', ..•... .. •... ..•. .. . .•.. , 5,643,745 5,974,222 Exports: United Kingdom ...... , ...... 753,021 918,511 from 2,001,378 bales on December 31 to 2,066,302 bales on Franco ...... 538,545 498,023 January 31, and on the latter date were at an all-time high Italy ...... , ...... 202,229 213,236 Garmany ...... 0 • • • • •• ••• 305,012 484,165 level. Othcr Europe ...... 424,937 622,944 Jaran ...... 914,308 1,059,547 COTTON CONSUMED AND ON HAND AI otbor countri es ...... 207,030 207,171 (Bales) Total exports ...... 3,435,082 4,003,597 January January August 1 to January 31 Stocks hold at all United States ports, January 31...... • . . . . . 2,488,708 2,608,756 1087 1036 This SOBSon Last soason Cotton-growing states: Cotton oonsumed...... 564,874 407,054 3,310,162 2,527,342 Cotton on hand Jan. 31 in- SPOT COTTON PRICES-(Middling basis) 1,748,008 1,212,587 Consuming establishmonts. (Conts p~r pound) Publio storage and oom- presses ...... 6,000,474 7,710,203 January, 1937 United States: Fobruary 15, Cotton oonsumed ...... 678,004 500,484 3,848,105 3,014,381 High Low 1937 Cotton on hand Jan. 31 in- Nowyork ...... 13 .33 12 .91 13 .15 Consuming establishmonts . 2,066,302 1,436,418 Now Orleans ...... , ...... 13.40 12 .78 13 .00 Puhlio storago and oom- Dallas ...... 12 .07 12 .29 12 .45 prosses ...... 6,770,351 7,844,547 Houston ...... , 12.89 12.53 12 .07 SOURCE: Bureau of Census. Galveston ...... , .. .. . 12.82 12 .46 12.68 MONTHLY BUSINESS REVIEW 7

Petroleum A further expansion in the production of During the latter part of January a general advance of petroleum in the Eleventh Federal Re­ 10 to IS. cents a barrel in the price of crude oil was posted serve District occurred during January when allowables at fields throughout this district. In some instances the Were again raised to meet the increased market demand. The gravity schedule was broadened to include a further grading output for the month rose to 44,,094,,950 barrels, which was of both the higher and lower gravity oils. - ?nly moderately lower than the previous record established In l\;1ay, 1933. The January figure compares with a pro­ JANUARY DRILLING RESULTS duction of 42,4.64,200 barrels in December, and an output Com- Pro- Gas Initial pletion8 ducers We1l8 Failures Produotion of 35,498,100 barrels in January, 1936. During the four North Texas ...... , ... 185 105 8 72 25,584 Weeks ended there were fewer new wells com­ West Texas ...... 185 150 5 30 101,077 East Texas ...... , ...... 212 104 2 16 625,671 pleted and smaller initial production of producing wells South Texas ...... 275 201 11 63 88,662 ~han in the previous four-week period. Completions in the Texas Coastal ...... 06 62 4 30 23 ,526 Total Texas ...... 053 712 30 211 054,520 atest period totaled 1,016 wells of which 766 were pro­ N.w Mexioo ...... 52 48 1 3 68,016 ducers of oil yielding an initial flow of 1,027,4.26 barrels North Loui8iana ...... 11 6 4 1 3,090 of oil. ·Junua~total8, di8triet ...... 1,016 766 35 215 1,027,426 tDcocm r total8, distriot ...... 1,080 822 40 227 1,286,524 'Januarbj'gures represeat four weeks ended January 23, 1037. ~roduction at Texas fields averaged 1,252,056 barrels !Decem r figures represent four weeks ended December 26, 1036. dally in January, reflecting an increase of 47,485 barrels over December and 215,656 barrels over January last year. CRUDE OIL PRICES As compared with the previous month, production gains (Priee pcr barrel) January 31, January 31, Were registered at all major fields of the State with the 1037 1036 lcargest increases being shown for the east Texas and Texas T.XM COMtal (40 gravity and above) ...... $1.41 $1.22' North Texas (40 gravity and above) ...... 1.20 1.08 oastal areas. The upward trend of production in New North Louisiana (40 gravity and abov.) ...... 1.22 1.10 ~exico continued during January, the average daily output ·Prices of oil 34 gravity and above. or the month rising 6,975 barrels above that in December. SOURCE: "The Oil We.kly", Houston, Texas, ~rO?Uction in north Louisiana averaged 77,997 barrels daily unng January, which was 1,855 barrels lower than in the Building The estimated value of building permits previous month. issued during January at fourteen cities in the Eleventh District dropped 10.2 per cent under the OIL PRODUCTION (BarreI8) large December volume, but exceeded the January, 1936, Inorease or deorease over total by 29.3 per cent. The January valuation of $5,524,,395 January, 1037 December, 1936 was, with the exception of December, larger than in any Total Daily Avg. Total Daily Avg. month since March last year. Although more than half of ~~\\~~x as ...... 4,126,600 133,116 + 188,800 t 6.000 East Tex as ...... 6,301,750 203,282 + 144,600 4,664 the month's total was represented by permits issued at one South Te':· · ·· · ······ .. ····· 17,056,800 550,210 + 510,100 +16,745 5,776,500 186,330 + 240,200 + 8,030 city, there were eight cities which showed increases over Texas Coasi~".::::::::::::::: ---5,552,100 170,100 + 370,350 +11,047 the previous month and a like number which registered New ~~~i Texas ...... 38,813,750 1,252,056 +1,472,050 +47,485 gains over a year ago. Permits issued numbered 1,600 in 2,863,300 02,365 + 216,200 + 6,975 North Lou~~i~;,i".'::::::::: ::: 2,417,000 77,097 - 57,500 - 1,855 January as compared with 1,914 in December and 1,644 in the same month last year. - Total Di8triot ...... 44,004,050 1,422,418 +1,630,750 +52,605 BmLDING PERMITS January, 1037 January, 1036 Peroentag. ehange Deoember, 1036 P.reentage ehange valuation valuation No. Valuation No. Valuation over yoar No. Valuation over month Amarillo ...... 10 $ 45,078 22 $ 43,334 + 6.1 3a $ 80,007 + 16.1 127 220,002 154 700,345 - 72 .5 143 214,556 + 2.6 02 42,200 07 210,888 - 80.8 07 174,075 - 75 .7 101 305,481 81 125,530 +143 .4 132 141,635 +115.7 301 570,753 410 000,275 - 42 .0 357 1,044,430 - 70 .2 85 110,340 47 42,093 +183 .5 64 50,601 +135.0 124 280,231 102 582,400 - 51.0 184 614,760 - 54 .4 80 155,717 82 25,561 +500.2 76 43,840 +255.2 241 2,006,605 260 703,021 +266.1 324 1,640,370 + 76.2 00 52,124 69 25,409 +105.1 126 58,802 - 11.4 187 415,652 105 480,880 - 15 .2 252 303,178 + 5.7 110 353,157 73 84,203 +319.4 82 135,278 +161.1 27 30,046 27 27,753 + 40 .7 31 144,150 - 72 .0 7 8,950 7 12,905 - 31.1 13 547,577 - 98.4 1,644 $4,271,546 +20.3 1,014 $6,151,868 - 10 .2 ------Total...... 1,600 $5,524,305 8 MONTHLY BUSINESS REVIEW SUMMARY OF NATIONAL BUSINESS CONDITIONS (Complied by the Board of Governors of the Federal Reserve System)

INDUSTRIAL PRODUCTION Industrial activity, adjusted for seasonal changes, showed a decline in Janu­ , NltctNT ...... I 40 140 ary following a rapid rise in November and December. Distribution of commodi­ 130 \30 ties to con~umers declined more than seasonally. J\. ..0 120 PRODUCTION AND EMPLOYMENT \ 110 110 I Volume of industrial production, 'which usually increases at this time of year, 100 ~ 100 A IV declined from December to January, and the Board's seasonally adjusted index to \ 90 1\1/\ i'" was 115 per cent of the 1923-1925 average, as compared with 121 in December eo '\ 80 and 114 in November. Steel production increased, though by less than the usual \, \ V 70 70 seasonal amount, and was larger in J anuary than at any other time during the .0 1\ f' 60 recovery period. In the first three weeks of February output of steel increased somewhat further. Output of automobiles was curtailed by strikes in January and eo 1929 taso t~1 193t 10M 1934 ID56 115& 1037 ISO the first half of February but after the strikes were settled production rose sharply. At lumber mills there was a considerable decrease in activity in Janu­ Index of physical volume of production, adiusted ary, reflecting in part the effects of unusually cold weather in the western lumber for seasonal variation, 1928-1926 average = 100. By months, January, 1929, to January, 1987. regions. Production of plate glass declined further in January but toward the end of the month the strikes which had restricted output since October were settled. At textile mills activity declined from the exceptionally high level reached in December, and in the meat-packing industry there was also a decrease, while FACTORY EMPLOYMENT output at shoe factories increased. Mineral production was smaller in JanuarY em H.II CCNT 120N' I 20 than in December, reflecting a: reduction in output of coal. There was a further rise in output of crude petroleum. 110 I 10 Value of construction contracts awarded showed a considerable rise in Janu­ h I 100 00 ary, according to figures of the F. W. Dodge Corporation, and was substantiallY 1\ / 90 larger than a ye.ar ago. The most marked increases over December were in f,ac­ \ /\ r./ tory building, which recently has been in larger volume than at any time since eo eo 1930, and in residential building. The increase in residential building was largely

70 '\ I 70 in publicly-financed apartment construction.

V J 60 Factory employment and payrolls showed about the usual seasonal decline 00 between the middle of December and the middle of January. Among the durable 00 60 goods industries there were increases in employment at blast furnaces and steel mills and at foundries and machine shops, while in the automobile industry there Index of number employed, adiusted for seasonal was a considerable decline. In industries producing nondurable goods employment variation, 1928-1926 average = 100. By month. , declined by less than the usual seasonal amount, 'with increases at textile mills January, 1929, to January, 1987. and in the chemical industries, and seasonal reductions in working forces in most other lines.

WHOLESALE PRICES DISTRIBUTION I'CIIU,Nf ... "NT I 10 110 Department store sales showed the usual seasonal decrease in January, whi~e 100 I I 00 sales at variety stores and mail-order houses declined considerably more than JS usual. Car'loadings of revenue freight also declined in January, reflecting in pal't 00 I 90 Olher the effects of floods. There were substantial declines in shipments of forest prod­ Conmodli lts ~ ~~ 80 eo . ""V ucts, coal, and miscellaneous freight. r;;'ootIs k. 70 70 COMMODITY PRICES I, "" ~~.l 60 60 V)"tV'{ The general level of wholesale commodity prices, which, according to the eo 00 V"I / Fcrm iroducts Bureau of Labor Statistics, had advanced more than 5 per cent from the end of 40 40 October to the middle of January, showed little change from the middle of I 30 January to the third week of February. Prices of agricultural commodities 1932. I ... 1e34 1936 1937 declined slightly, while industrial commodities as a group continued to advanced' There were substantial increases in nonferrous metals, lumber, and petroleum and Indexes compiled by the United States Bureau of smaller increases in a wide variety of finished products, while prices of glass an Labor Statistics, 1926 = 100. By weeks, 1982 to date. Latest figure is for week ending certain cotton textiles declined, following rapid increases in other recent monthS. February 20, 1987. BANK CREDIT Total loans and investments of weekly reporting member banks in leading cities declined some'what further during the four weeks ending February 17, MEMBER BANK LOANS AND INVESTMENTS ...­ ~, UQMS ()IfOClU.. ItS reflecting principally a decrease in holdings of United States Government obliga­ "' ...... \I • LOANS INVESTMENTS tions. Commercial loans, following a seasonal decline in January, increased at 10 reporting banks outside New York City and remained practically unchanged in r-~~y New York. On January 31 the Board of Governors raised reserve requirements for melli­ I bel' banks by 33 % per cent, half of the increase to become effective on March 1 I--~/ ..... _".---.. and half on May 1. This action completes the use of the Board's authority under the law to raise reserve requirements. ~ ~ ue.Gort'1rJ~ Gwtaflt ... OI:II/taI~ ':r~,,":;,", .-... Excess reserves of member banks showed little change in the five weeks end­ I .t:::i=:- ing February 24 j there was a further increase at New York City banks and 80 o n- I decline at banks elsewhere. .. 111M 1935 1831 M 1&:55 1838 193' The rate on bankers' acceptances was raised 1/16 of 1 per cent on February 1, Wednesday figures for reporting member banks in following a similar increase on . Market yields on short and mediulll 101 leading cities, September 6, 1984, to February 17. 1987. Loans on real estate and loans to term Treasury obligations also increased slightly in January and the early part banks excluded. of February, while yields on long-term Government bonds showed little change.