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MONTHLY REVIEW
OF
B U S IN E S S
C O N D IT IO N S
ISAAC B. NEW TO N , Chairman of the Board and Federal Reserve Agent
Federal Reserve Bank of San Francisco
Voi. X III
San Francisco, California, July 20,1929
No. 7
S U M M A R Y OF N A T IO N A L C O N D IT IO N S
Prepared by the Federal Reserve Board
Output of manufactures continued in large
volume during June, while mineral production
declined. There was a rise in the general level
of com m odity prices, reflecting chiefly an ad
vance in agricultural commodities.
Production. A ctivity of manufacturing es
tablishments continued at a high rate in June.
Output of automobiles and of iron and steel
showed a seasonal decline smaller than is usual
from May to June. Silk mill activity increased
and there was a growth in the daily average
production of cement, leather, and shoes. Pro
duction of copper at smelters and refineries de
creased sharply, and output of cotton and w ool
textiles was also reduced, although production
in all of these industries continued larger than
in other recent years. The volume of factory
employment and payrolls in June showed a
small seasonal decline from May, but, as in
earlier months, was substantially larger than
in 1928. Output of mines was generally smaller
in June than in May, reflecting declines in the
production of coal, copper, and other nonferrous metals. Output of petroleum, however,
increased to new high levels.
Reports for the first half of July indicate
some further reduction in output of cotton
textiles, iron and steel, lumber, and coal. V o l
ume of construction contracts awarded de
creased further in June, and for the first half
of the year awards were 12 per cent less than in
the same period in 1928, reflecting chiefly a sub
stantial decline in residential building. During
the first three weeks of July contracts awarded
were larger than in the same period a year ago.
Agriculture. Department of Agriculture es
timates, based on July first crop condition
reports indicate a wheat crop of 834,000,000
bushels, about 8 per cent smaller than produc
tion last year, but larger than average produc
tion in the preceding five years. The acreage
of cotton in cultivation on July first was esti
mated at 48,457,000 acres, 3 per cent more than
a year ago.
Distribution. During the month of June
freight carloadings were slightly smaller than
in May, as a result of decreases in loadings of
most classes of freight, except grain products
and ores. In comparison with other recent
years, however, loadings continued to show an
increase. Sales of department stores in June,
as in earlier months were larger than in the
same month in 1928.
Prices. W holesale prices, according to the
Bureau of Labor Statistics index, advanced
from May to June on the average by some
what less than they had declined during
the preceding month. Farm products, particu
larly grains, cattle, beef, and hides showed
marked advances in price. Prices of mineral
products and their manufactures also averaged
higher in June than in May, the rise reflecting
largely increases in the price of petroleum and
gasoline. Prices of leading imports— rubber,
sugar, silk and coffee— showed a decline for the
month as a whole. During the first two weeks
of July wheat and corn continued to move
sharply upward, while hides declined slightly
PER
IIC
125
CENT
i f
MANUFAC: t u r e s /
—v
100
Y V
V
A
f
t
s
!/'
Uv—
"
1
I r»
\
r........
fr
•
(00
9 - •
/MINERAL s
t
-----
------—
— —
-vU
P R O D U C T IO N O F M A N U F A C T U R E S A N D M IN E R A L S
In d ex num bers of p rod u ction o f m anufactures and m inerals, adjusted
for seasonal variations (1923-1925 average = 100). Latest
figures, June, m anufactures 126; m inerals 113.
90
1925
1926
1927
I92Ô
1929 T
W H O L E S A L E P R IC E S
Index of United States Bureau of Labor Statistics (1926=100, base
adopted by Bureau). Latest figure, June, 96.4.
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
50
in price. H og prices increased and prices of
rubber and tin, which began to advance in the
middle of June, continued to rise.
Bank Credit. During the first half of July
the volume of credit extended by member
banks in leading cities declined somewhat, fol
low ing a rapid increase in June. On July 17
loans and investments of these banks were
July, 1929
volume of reserve bank credit outstanding
showed an increase of about 120 million dollars
during the four weeks ending July 17, the in
crease being in discounts for member banks.
Demand for additional reserve bank credit
arose chiefly out of a considerable increase in
the volume of money in circulation which ac
companied the issuance of the new small-size
B IL L IO N S
R E S E R V E B A N K C R E D IT A N D M O N E Y IN C IR C U L A T IO N
IN M IL L IO N S O F D O L L A R S
M on th ly averages o f daily figures. Latest figures are aver*
ages o f first 21 days in July.
about 4 million dollars above the level at the
end of May. The increase reflected chiefly
rapid growth in loans to brokers and dealers in
securities and also some further increase in
commercial loans. The banks’ holdings of in
vestments continued to decline and on July 17
were about 7 million dollars below investment
holdings at the middle of last year. The total
M E M B E R B A N K C R E D IT
M on th ly averages o f w e e k ly figures fo r reporting m em ber banks in
leading cities. Latest figures are averages o f first three
w ee k s in July.
currency. There was also some increase in re
serve balances of member banks accompanying
the growth in their loans and consequently in
their deposits. Open market rates on 90-day
bankers’ acceptances declined from
to 5 %
per cent between the latter part of June and
the middle of July, while rates on prime com
mercial paper remained unchanged.
T W E L F T H F E D E R A L R E S E R V E D IS T R IC T C O N D IT IO N S
Business in the Twelfth Federal Reserve
District was more active during the first six
months of 1929, than during the same period of
1928. Prices of many commodities, particu
larly farm products, important in the District’s
commerce, have advanced during the past
month indicating that despite reduced yields of
some crops agricultural purchasing power, in
the aggregate, may not be seriously reduced as
compared with recent years. A decline in the
loans and investments of reporting member
banks in the District between the middle of
June and the middle of July reflected a decrease
in the banks’ loans on securities which had in
creased earlier in the year, and in their invest
ment holdings. There was no further advance
in interest rates, bank reserves increased, and
Reserve Bank credit in use approached the low
est level of several years, notwithstanding the
increased accommodation extended to agricul
tural sections.
Industry operated at record levels during the
early months of 1929, but slackened its pace
considerably during June, despite a record
breaking production of petroleum and an in
creased cut of lumber. There were sharp
recessions in building permits issued and in
construction contracts let during June, as com
pared with large totals of earlier months of
the year.
Retail and wholesale trade have been active
during the past six months. Sales of new auto
mobiles exceeded previous records throughout
the half-year. Both the volume of intercoastal
traffic and foreign trade, although greater
than during the first half of 1928, have de
clined steadily since early this year.
In June, the downward trend of prices which
had been evident since the first of the year was
reversed largely as a result of advances in
quotations on agricultural products. Lumber
prices remained firm.
Discounts at the Federal Reserve Bank of
San Francisco fluctuated irregularly during
June and early July without showing much
net change until the week ended July 17, when
they dropped sharply. Recent increases in
borrowings by country member banks, prob
ably in response to the seasonally expanding
credit needs of agriculture, were offset by re
duced borrowings of city banks. The decrease
in Reserve Bank credit extended to city mem
ber banks was coincident with a sharply in
creased demand for currency, and the member
banks met the situation by sales of investments,
reductions in loans on securities, and transfers
July, 1929
FEDERAL RESERVE AG EN T AT SAN FRANCISCO
of funds into this District from other sections
of the country. The Reserve Bank further re
duced its holdings of acceptances and govern
ment securities.
Agriculture
The subnormal temperatures which have
characterized the 1929 agricultural season in
this District continued until late June, when
high temperatures were reported in most agri
cultural areas. Temperature abnormalities and
a continued shortage of water are reflected in
the United States Department of Agriculture’s
July 1 estimates of crop production, which in
dicate that, in general, yields will be smaller
this year than last. Livestock and livestock
ranges are in a less satisfactory condition than
a year ago.
July 1 estimates of this year’s deciduous fruit
and nut production in California, Oregon, and
W ashington show a decrease as compared with
production figures for 1928. No official esti
mates of grape production in California have
yet been made. The condition figures for wine,
raisin, and table grapes, however, stood at 76,
68, and 70, respectively, on July 1, as compared
with 96, 101, and 95, respectively, on July 1,
1928.
D E C ID U O U S F R U IT S A N D N U T S -P R O D U C T I O N
(in thousands)
F orecast
1928
1927
U nit
July 1,1929
C a liforn ia
7,458
7,280
13,105
.................
A p p le s
175
208
180
A p r ic o t s ..............
19
12
15
C h erries ............ ..
492
299
618
P e a ch e s ...............
322
158
414
C lin g sto n e .. .
204
170
141
F r e e s to n e
181
172
225
57
41
66
P lu m s .................
203
128
220
P ru n e s
................
12
14
5
A lm o n d s ............
51
41
25
W a ln u ts .............
O re g o n
6,950
4,320
6,034
A p p le s
.................
2,700
1,900
2,387
P ea rs .....................
P r u n es*
............
20
23
3
W a s h in g t o n
33,500
25,343
A p p le s
.................
28,530
3,500
1,670
2,842
P e a rs
....................
U n ite d S tates
184,920
123,693
A p p le s
.................
154,000
23,783
19,800
18,373
P e a rs .....................
68,374
45,463
P e a ch es ................
47,075
* O r e g o n and C la rk e C o u n ty , W a s h in g t o n .
S o u r c e : U n ite d S tates D e p a r tm e n t o f A g r ic u ltu r e .
California deciduous fruits offered at East
ern auction markets during the 1929 marketing
season (to mid July) have sold for prices aver
aging approximately 20 per cent higher than
last year. Prices paid for most canning fruits
have been double those of a year ago. Ship
ments of California’s small 1929 fruit crop to
Eastern markets and to canneries have been
delayed due to the late maturity of the fruit,
and up to July 1 totaled 1,860 carloads as com
pared with 3,264 carloads shipped during the
1928 season up to July 1.
The record 1929 Valencia orange crop in
California, which is estimated at 19,310,000
boxes, has been m oving to market in large vol
ume during the past two months. During May
and June of this year, 16,211 carloads of or
51
anges were shipped from California, compared
with 8,842 carloads shipped during the same
period in 1928. The increased supply of small
oranges has been a difficult factor in the mar
keting of the 1929 crop and average prices
f. o. b. California have been at levels approxi
mately 50 per cent below those of a year ago.
The 1929 lemon crop— 4,698,000 boxes— moved
to market in large volume during June, 1929,
when 2,667 carloads ( approximately 928,120
boxes) were shipped. In June last year, 1,917
carloads (approximately 667,120 boxes) were
marketed. Average prices for lemons f. o. b.
California were slightly higher during June,
1929, than a year ago.
The acreage planted to wheat, oats, and bar
ley in the District is about 2 per cent less this
year than the acreage from which these crops
were harvested in the autumn of 1928. W ith a
smaller acreage and decreased yields per acre,
production is expected to be smaller than in
1928. Physical and other conditions during the
remaining weeks before the harvest will, of
course, aid in determining the ultimate 1929
yield of these grains.
G R A IN C R O P S — P R O D U C T IO N
(In thousands of bushels)
------A ll W h e a t------ »
,---------B arley--------- *
F o re ca st
F orecast
July 1,1929
1928
July 1,1929
1928
A r iz o n a
......................................
1,053
1,269
599
646
C a lifo rn ia ...................................
10,871
16,380
25,004
31,842
...........................................
27,216
28,792
5,757
6,192
Idaho
N e v a d a ........................................
405
482
421
440
O r e g o n ........................................
21,430
23,318
3,949
3,675
U tah ..............................................
4,984
6,861
1,527
1,666
W a s h in g to n ...............................
43,966
48,644
1,784
1,952
T w e lfth D is tr ic t ...................... 109,925 125,746
39,041
46,413
U n ited S ta tes .......................... 833,869 902,191
317,764 356,667
S o u r c e : U n ite d S tates D e p a r tm e n t o f A g r ic u ltu r e .
Although the acreage planted to the princi
pal field crops in the District is 3 per cent larger
than was harvested in 1928, this year’s produc
tion forecast (July 1) of each of these crops,
with the exception of beans, shows a smaller
yield than the final estimates for 1928. Federal
legislation does not permit a forecast of cotton
production prior to August 1.
F IE L D C R O P S — P R O D U C T IO N
(in thousands)
F oreca st
B e a n s ( b u .)
July 1,1929
1928
6,057
5,901
C a lifo rn ia , I d a h o .....................
U n ite d S tates ...........................
18,223
16,630
T a m e H a y (t o n s )
T w e lfth D is t r ic t ......................
13,614
14,568
........................
98,991
U n ite d S ta tes
92,983
H o p s (lb s .)
29,550
C a lifo rn ia , O r e g o n , W a s h . .
32,742
U n ite d States ...........................
29,550
32,742
P o t a t o e s ( b u .)
38,620
T w e lfth D is t r ic t ......................
47,107
U n ite d States ........................... . .
379,290
464,483
R ic e ( b u .)
C a lifo rn ia ....................................
8,073
U n ite d S tates ...........................
32,686
41,881
S u g a r B e e ts (t o n s )
C a lifo rn ia , I d a h o , U ta h . . .
1,328
1,578
U n ite d S tates ...........................
7,633
7,101
1927
6,531
16,891
15,312
106,001
29,794
29,794
55,756
406,964
8,960
40,231
1,534
7,753
S o u r c e : U n ite d S tates D e p a r tm e n t o f A g r ic u ltu r e .
Livestock and livestock range conditions
showed no improvement during June and early
July. Market receipts of range stock at the
District’s stockyards during the current sea
son have been of poorer quality than those re-
52
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
ceived a year ago, reflecting the scarcity of
good feed in most range areas. Some stock in
Arizona and California have been moved from
the poorer range areas either to high moun
tain pastures or to grain stubble fields in the
lower valleys.
Receipts of livestock at the eight principal
markets of this District have shown the same
trends as receipts at the principal national
markets in the Middle W est. Market prices for
cattle were steady during June at levels ap
proximately 3 per cent higher than in June,
1928. Sheep prices generally have been about
10 per cent lower during 1929 than during the
1928 marketing period. H og prices rose steadily
during June, and were approximately 10 per
cent higher than in June, 1928.
Some sales of w ool were reported during
June at levels approximately 20 per cent lower
than prices paid in 1928. W o o l markets have
been relatively inactive during recent months,
and it is reported that approximately 30 per
cent of the 1929 w ool clip in the United States
remained unsold at mid-July.
Industry
Industrial activity in the Tw elfth District
was maintained at record levels during the first
half of 1929, although in nearly all industries,
except petroleum, there was evidence of some
tapering off of activity during May and June.
This retardation was contrary to the seasonal
movement in most industries for which data
are available. Considering the first six months
as a whole, however, output of the District’s
chief industrial products— lumber, petroleum,
copper, refined mineral oils, flour, and mis
cellaneous manufactures — was of record or
near-record volume. From January to June,
1929, building and construction contracts
awarded were substantially greater in value
than in the first half of 1928. Employment con-
(A ) Industry—
(1923-1925 daily average = 1 0 0 )
,------------------ 1929 --------------,.------ 1928------>
Six
Six
Months
Months
Average June May Apr. June Aver.
F lo u r ..................................................
S la u g h te r o f L i v e s t o c k ............
L u m b e r .............................................
R e fin e d M in e ra l O i l s t ...............
C em en t ..............................................
W o o l C o n s u m p t io n .....................
M in e r a ls :
P e t r o le u m ( C a l i f o r n i a ) f ..........
C o p p e r (U n it e d S t a t e s ) $ ..........
L e a d (U n it e d S t a t e s ) ? ............
S ilv e r (U n it e d S ta te s ) $ ............
G e n e r a l:
C a rlo a d in g s — In d u s tr ia l ..........
V a lu e o f B u ild in g P e r m i t s #
T w e n t y C ities ...........................
S e v e n ty C ities ...........................
V a lu e o f E n g in e e r in g C o n tr a c ts
A w arded#
T o t a l .........................................
______ E x c lu d in g B u ild in g s . . . .
I ll
84
112
182
I ll
7 5 1|
105
83
109
190
96
..
94
105
88
82
85
92
105
113 103
180 1870 156
103
106
111
..
76
75
102
100
105
148
114
75
IN D E X
NUM BERS
IN D U STR IA L C A R L O A D IN G S—T W E L F T H DISTRICT
Index adjusted for seasonal variations; 1923-1925 daily average =»100.
Latest figure, June, 120.
Production of petroleum in California was
at an exceptionally high level during the first
half of this year, and the daily rate of output
averaged approximately 27 per cent higher
than in the corresponding period of 1928. In an
effort to avoid the serious effects of continued
over-production a voluntary curtailment pro
gram was attempted by producers during the
spring months. This plan was not successful,
and on June 22 all cooperative production re
straints were removed. Further increases in
production followed, and during the week end
ing July 13 average daily output reached 882,600 barrels, the highest rate of production for
any entire week of record. A new California
law providing for conservation of natural gas,
with the attendant effect of conserving petro
leum, is now scheduled to go into effect on
August 31. The run of crude oil to stills and
refineries in California was about 20 per cent
(jB) Employment—
No. of
No. r~ Employees —% No.
of
June,
June,
of
Industries
Firms 1929
1928 Firms
145
All Industries.......... 717 155,637 146,831
S to n e , C la y and
G lass P r o d u c t s .
6,167
6,238
L u m b e r an d W o o d
^
M a n u fa ctu re s . . 110 25,041
41
25,718
(—2.6)
No. of
Employees
June,
June,
1929
1928
29,430
27,614
(-6 .2 )
147
( - - 3 6 .1 )
16,613
53
( — 3 .9 )
5
2,305
2,367
9
60
7,864
7,818
8*
157
(0 -6 )
27,270
29,837
230
17,291
2,125
(1 8 .3 )
1,796
455
(0 .7 )
452
40
2,547
( - -3 9 .9 )
4,236
30
M is c e lla n e o u s . . .
13
2,575
2,021
________
(2 7 .4 )
^ L a u n d e r in g o n ly , j l n c l u d e s th e fo llo w in g
m a c h in e r y and c o n v e y a n c e s ; le a th e r
c h e m ic a ls , o ils an d p a i n t s ; p r in t in g an d
F ig u r e s in p a re n th e se s in d ica te p e r c e n ta g e
5,727
(5 .6 )
5,425
T e x tile s
..............
C lo th in g , M illin e ry
and L a u n d e r in g .
17
^
119
134
113
97
126
125
112
96
117
139
122
100
118
141
122
106
97
102
104
101
94
105
104
90
114
120
124
117
118
113
W a t e r , L ig h t and
P o w e r .................
70
94
64
96
73
96
76
94
70
95
73
88
O th e r I n d u s t r ie s !. 314
162
193
121
101
134
146
168
203
130
106
131
112
fN o t adjusted for seasonal variation. ^Prepared by Federal Re
serve Board. #Indexes are for three months ending on the
month indicated. ]]Four months’ average. QRevised.
ditions were generally improved as compared
with last year, except for workers in the agri
cultural and lumbering industries in California.
Available data indicate a movement of workers
out of California and into the Pacific North
west during May and June.
t-------- California------—% /------------ Oregon ....... - - ^
Indexes of daily average production, adjusted for seasonal variations
Manufactures:
July, 1929
F o o d , B e v e ra g e s
and T o b a c c o . . .
^
5
^
7,968
(—2.1)
76,447
(1 8 .2 )
8,140
64,692
in d u s t r ie s : m etals,
and r u b b e r g o o d s ;
paper g o o d s.
c h a n g e s Ju n e , 1928.
July, 1929
FEDERAL RESERVE AG EN T A T SAN FRANCISCO
greater during the first half of 1929 than dur
ing the same period of 1928. Total shipments
of petroleum from California through the
Panama Canal to Atlantic and Gulf Coast ports
for the six months ending June 30, 1929, ex
ceeded those for the six months ending June 30,
1928, by 18 per cent, the result almost entirely
of a more than 50 per cent increase in ship
ments of gasoline. Crude oil shipments de
clined by more than 50 per cent over the year
period, the decline being attributed to in
creased competition from the new oil fields in
Venezuela. Stored stocks of all oils in Cali
fornia on June 30 were 18 per cent larger
than those held on June 30, 1928, chiefly be
cause of increases in stocks of light refinable
crude oils. Despite sharply increased produc
tion, gasoline stocks at California refineries de
creased one per cent from June, 1928, to June,
1929, a reflection of increased consumption
which, for the United States as a whole, was
13 per cent larger during the five months end
ing May 31 than during the same five months
o f 1928.
The total lumber cut of this District during
the first half of 1929 was about 7 per cent
larger than in the corresponding period of
1928, according to estimates prepared by this
Bank. The Pacific Northwest accounted for all
of this increase, the lumber output in Califor
nia having been smaller than in 1928. Severe
weather conditions forced substantial curtail
ment of lumbering activities in W ashington
and Oregon during February, but expansion
(C ) Bank Debits*—
A r iz o n a
P h o e n ix
June,
1928
June,
1929
..........$
44,939
C a lifo rn ia
B a k ersfield . . .
12,777
B e r k e le y .........
19,361
F r e s n o ............
28,636
L o n g B e a c h ..
60,534
L o s A n g e l e s . . 1,146,370
O a k la n d . . . .
243,112
P a sa d e n a . . . .
38,408
S a c r a m e n to . .
57,792
S a n B e r n a r d in o
10,722
S an D ie g o . . .
59,717
S an F r a n c is c o . 1,271,611
S an J o s e . . . .
28,201
S a n ta B a rb a r a
18,266
S tock ton
....
29,515
$
33,613
during March, April, May, and the first part of
June brought total production for the half-year
well above comparable output figures for 1928.
During the latter part of June a number of
mills reported that they were working short
shifts and contemplated more extensive shut
downs than usual over July 4 and the period of
summer fire hazard. A ccording to data pub
lished by the National Lumber Manufacturers’
Association, shipments of lumber have been
somewhat heavier thus far in 1929 than in 1928,
but carloadings of forest products as reported
by railroads of the District declined slightly
and shipments of lumber through the Panama
Canal declined by 17 per cent as compared with
the 1928 figures. New orders received were
well maintained in relation to shipments and
production until May and June when they de
clined sharply. During the first six months of
1928 total shipments were 5 per cent and orders
8 per cent greater in volume than total pro
duction, while during the same period in 1929
shipments and orders exceeded production by
4 and 6 per cent, respectively.
The dollar value of building permits issued
and of engineering construction contracts
awarded during the first half of 1929 was ap
proximately 12 per cent larger than the figures
reported for the first half of 1928, but the trend
of month to month changes was reversed. The
first six months of 1928 witnessed more than
seasonal increases in building and construction
activity. The same period this year began at a
higher level but has been marked by greater
than seasonal declines, especially in May and
June. Follow ing the tendencies in evidence
t— F irst Six M on th s —-■%
1929
$
269,250
1928
$
209,148
13,943
20,682
31,810
53,531
1,153,229
255 ,614
40,270
50,186
11,651
68,050
1,899,374
29,258
13,207
31,432
85,265
126,516
183,814
387,248
7,392,478
1,449,163
263,174
299,762
68,079
393,288
8,184,428
168,993
102,863
165,878
87,348
129,834
199,862
326,036
6,530,098
1,514,137
257,249
288,952
64,441
386,395
9,686,884
164,281
82,614
175,924
Idah o
B o is e
...............
15,712
16,154
87,655
84,800
N ev a d a
R en o
.................
13,399
11,118
73,077
55,029
O reg on
E u g e n e ............
P o r tla n d .........
8,248
189,973
8,503
198,766
45,343
1 ,129 ,119 t
U ta h
O g d e n ..............
S alt L a k e C ity
16,616
77,512
16,534
76,086
106,208
473,144
100,383
439,893
W a s h in g t o n
B e llin g h a m
..
E v e r e t t ............
R it z v ille .........
S ea ttle ............
S p o k a n e ..........
T a c o m a ..........
Y a k im a
..........
10,662
15,707
886
259,157
60,579
50,940
14,540
10,734
15,214
763
258,614
57,584
47,130
13,287
62,691
85,590
5,268
1,577,838
357,739
298,772
82,048
60,483
78,571
5,386
1,471,808
335,945
_______ T o t a l ..........$3,803,892
$4,436,337
43,906
1,026,859
271,981
75,949
$ 2 3 ,9 2 4 ,6 9 1 f $24,154,196
* I n th ou sa n d s o f d olla rs, f ln c l u d e s $7,584,000 at fo u r b a n k s n o t
r e p o r t in g p r io r to w e e k e n d e d M a y 2, 1928.
53
(D) Distribution and Trade—
-------19,29----------
r
Six
M on th s
A v era ge
F o r e ig n T ra d e d
T o t a l f .....................
I m p o r t s f ..............
E x p o r ts .................
I n te r co a s ta l T ra d e d
TotalO .....................
..........
W estb ou n d
E a s tb o u n d ............
C a rlo a d in g s
T o t a l*
...................
M e r ch a n d is e and
M is c e lla n e o u s !
W h o le s a le T r a d e
R e ta il T r a d e
A u to m o b ile Sales$
T o t a l ...................
P a s s e n g e r C ars.
C o m m e r c ia l
V e h ic le s . . . .
D e p a rtm e n t S to r e
S a le s i ................
S tock s§
............
June
,.
..
145°
132°
152°
..
92
129
83
89
131
77
. , 115
..
118
.
M ay
A p ril
1928--------s
Six
M onths
June A verage
135
117
144
121
112
127
123
115
128
86
125
76
90
127
80
87
111
80
85
103
80
118
1190
116
118
113
116
118
118
118
114
104
101
109
105
102
101
.
131
. . 130
132
130
1360
1360
131
129
99
100
86
86
146
147
1410
146
92
82
. . 121
.
102
122
105
S t o c k T u r n o v e r ]].
C o lle c tio n s #
R e g u la r
............
In s ta llm e n t . . . .
121
115
115
117
101
109
107
1030
----------^
------------A ctu al F ig u r e s .25
.24
.26
.24
.23
.23
46.4
15.2
45.5
14.4
47.4
14.8
45.9
15.9
45.0
15.4
45.3
15.7
* A d ju s t e d fo r s e a so n a l v a r ia tio n s, 1923-1925 averagerzrlOO. t E x c lu d in g ra w silk. J D a ily a v e ra g e . § M o n th ly to ta ls o f ten
lin es c o m b in e d . ¿ A t e n d o f m o n th . ||P r o p o r t io n o f av e ra g e
s t o c k s so ld d u r in g m o n th . # P e r c e n t o f c o lle c t io n s d u r in g
m o n th t o a m o u n t o u ts ta n d in g at first o f m o n th . {[In d e x e s
are f o r th re e m o n th s e n d in g o n m o n th in d ica te d . Q R evised.
° F o u r m o n t h s ’ a v e ra g e .
54
July, 1929
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
during the past four years, building was more the past six months have ranged from 3 to
active in the smaller than in the larger cities of 5 per cent smaller in value than in the first
the District. During June the value of both half of 1928.
R E T A I L T R A D E — T w e lfth D istrict
building and engineering contracts awarded
,---------N E T S A L E S * ----------^
STO C K *
was below that for the previous month or the
J a n .l t o
June, 1929
June 30.1929
June, 1929
same month a year ago.
com pared
com pared with
com pared
with
Jan. 1 to
with
Total output of the District’s non-ferrous
June. 1928
June 30,1928
June. 1928
metals mines was much larger during the first D e p a r tm e n t S t o r e s f . . . — 0.4 ( 68)
2.2 ( 68 )
— 3.7 ( 52)
2.6 ( 3 0 )
3.1 ( 19)
e l S to r e s ............... — 1.5 ( 30 )
six months of 1929 than in the first six months AF puprna ritu
r e S to r e s ..........— 0.7 ( 4 8 )
2.2 ( 47 )
— 1.9 ( 33)
of 1928. During May and June production
2.2 (1 4 5 )
— 3.0 (1 0 4 )
A ll S t o r e s .......................... — 0.5 (1 4 6 )
schedules were reduced moderately from the * P e r c e n ta g e in cre a s e o r d e c r e a s e ( — ) . F ig u r e s in p a re n th e se s in
d ic a te n u m b e r o f s to r e s r e p o r tin g , f ln c l u d e s d r y g o o d s sto re s.
record levels established in the first four
During the first half of 1929, trade at whole
months of the year, but at the close of June
were still well above those of a year ago. Sales sale was at levels above those of a year earlier.
The wholesale groups showing the most sub
and shipments of copper declined during May
and June and were reported as being confined stantial increases in sales over the year period
largely to custom smelters. Stocks of both were the furniture and the elctrical supply
mine copper and of the refined metal have in dealers. Hardware, grocery, drug and paper
creased substantially during June, but on and stationery houses also reported moderately
larger sales, while sales of dry goods and agri
July 1, were smaller than on July 1, 1928.
A ctivity in the flour milling industry de cultural implements changed little from last
year. Shoe jobbers reported sales about 9 per
clined more than seasonally during the second
quarter of the year, coincident with sharp cent smaller during 1929 than during the first
half of 1928. Stocks carried by wholesalers on
fluctuations in wheat prices. The total output
for the first half of 1929 exceeded that for the June 30 were 5 per cent larger in value than
first half of 1928 by a substantial margin. M il those carried on June 30, 1928.
lers’ stocks of flour and of milling wheat at the IN D E X N U M B E R S
end of June were larger than those of a year
ago.
130
Trade
120
RIE T A IL
S »A L E S
A
A
/ v \ r
V
Trade was active in the Twelfth District 110
---------- 1 ? ■*,
WH OLESALE
t\ i
during the first six months of 1929, and the
ä SALES
x
A
V
100
,
/
y
volume of goods distributed was substantially
V
y
\I s
larger than in the same period of 1928. Sales
at retail and wholesale, sales of new automo 90
biles, railroad carloadings of merchandise and
I / V - : - - - - -----miscellaneous freight, and the District’s for
eign trade increased more than seasonally R E T A I L A N D W H O L E S A L E T R A D E — T W E L F T H D I S T R I C T
In dexes adjusted fo r seasonal variations. 1923-1925 average=100. D aily
from month to month. Total railroad carload
average figures of departm ent store sales. M on th ly figures of
sales at w h olesale.
ings changed little in volume and waterborne
intercoastal commerce, while well above the
Total freight carloadings reported by rail
comparable period of 1928, declined during the roads of the District for the first six months of
first half of 1929. During June this Bank’s this year were slightly larger than the first half
seasonally adjusted indexes of department of 1928. This was the result almost entirely of
store sales and of movements of commodities heavier loadings of merchandise and miscel
in the intercoastal trade advanced and were
laneous freight, industrial carloadings having
higher than in June a year ago. Adjusted in shown practically no change over the year
dexes of sales of new automobiles and of mer period. During June daily average carloadings
chandise carloadings declined from May to
of all classes of commodities combined declined
June but remained well above the 1928 figures. as compared with May, but were in practically
Trade at retail was greater in value during the same number as in June, 1928.
the first half of 1929 than during the first six
Sales of new automobiles, both passenger
months of 1928, total sales of reporting depart and commercial vehicles, were at exceptionally
ment, apparel and furniture stores during the high levels during the entire first half of 1929,
later period being 2 per cent above those of the total being more than 50 per cent larger
last year. Total sales during June, 1929, were than in corresponding months of last year.
about the same as in June, 1928, but as there Sales during June were smaller in number than
was one less trading day in June of this year in May, 1929, but were well above those of
daily average sales were actually 4 per cent June, 1928.
larger than in 1928. Stocks carried by report
W hen adjusted for seasonal variations, the
ing department stores of the District during volume of waterborne intercoastal trade de
a
J u l y ,1929
55
FEDERAL RESERVE AG EN T AT SAN FRANCISCO
clined during the first six months of 1929, but
was markedly greater than during the first six
months of 1928. In the year to year compari
son, traffic from Atlantic to Pacific Coast ports
increased by a larger percentage than did the
tonnage passing from the Pacific to Atlantic
Coast, a result chiefly of the reduced volume of
lumber and crude oil shipments from Pacific
Coast ports. During June the seasonally ad
justed indexes of intercoastal trade advanced
as compared with May, and were above those
of June, 1928. As compared with June a year
ago, shipments of petroleum and general cargo
from the Pacific to the Atlantic Coast were
larger and lumber shipments smaller in volume.
Foreign trade of the District, up to the end
of April, 1929, was substantially in excess of
the record for the first four months of 1928.
Total exports during the period January 1 to
April 30, 1929, were 16 per cent and total im
ports 11 per cent greater ’than during the
period January 1 to the end of April, 1928. The
volume of both imports and exports dropped
sharply in April as compared with March, but
remained well above that of April, 1928.
low levels reported during the first five months
of the year. Prices for w ool have declined
steadily this year and are now from 15 to 20
per cent lower than a year ago.
A m ong the more favorable price develop
ments of the period under review has been the
sharp increase in deciduous fruit prices. Higher
prices for these crops are tending to offset the
effect of severe crop losses— due to frost dam
age during April— upon agricultural income in
California and to a lesser extent in Oregon and
Washington. Prices to growers for canning
peaches, pears, and apricots are especially fa
vorable. Growers of citrus fruits are receiving
large aggregate returns for their crops, the ef
fect of the relatively low prices of the current
season having been more or less counter
balanced by record yields of fruit.
Prices
* A v e ra g e s o f M a y and Ju n e f. o. b . C a lifo rn ia p rice s.
The general level of wholesale commodity
prices declined during the first five months of
this year, but early in June the movement was
reversed and since then practically all of the
well-known com m odity price indexes have ad
vanced. Both the decline during the spring
months and the recovery during recent weeks
were due largely to changes in prices of farm
products. The downward tendency noted dur
ing most of the first half of this year was not
confined to the United States, but was also
reflected in indexes for countries throughout
the world.
Changes in farm products’ prices during the
first half of 1929 accounted largely for the gen
eral decline in com m odity prices in the United
States. During June, however, farm products’
prices reversed their previous downward trend
and the general com m odity price level im
proved. This rise in agricultural prices has
been a favorable factor in sustaining the agri
cultural purchasing power in the District dur
ing the past six weeks. The sharp recovery in
wheat quotations since June 1 has been of spe
cial interest to growers in this District. Live
stock prices have generally been at satisfactory
levels this year, although lamb quotations have
declined sharply during the past three months,
and are somewhat under the prices paid a year
ago. This lower level of lamb quotations dur
ing the late spring is a seasonal movement, but
it was accentuated this year by unusually
heavy marketings of animals during April and
May, the result of the poor condition of D is
trict ranges during those months. Since early
June, hide quotations have advanced from the
F R E S H F R U IT P R IC E S C a n n in g D e c id u o u s
(N u m b e r on e fru it)
....................................
A p r ic o t s
C h erries (R o y a l A n n e ) . . .
P e a ch e s ( C lin g s to n e ) . . . .
P e a rs ...........................................
C itru s*
O ra n g e s ....................................
L e m o n s ......................................
C aliforn ia
U nit
to n
to n
to n
to n
1929
$ 75.00
200.00
80.00
85.00
1<?28
$ 55.00
150.00
20.00
42.00
1927
$ 60.00
160.00
22.50
44.00
box
box
2.47
3.99
5.40
5.26
3.16
3.43
Softwood lumber prices increased steadily
throughout 1928, and firm market conditions
for woods produced in this District prevailed
during the first half of 1929. Reports indicate
some advances in Douglas Fir quotations dur
ing recent weeks as compared with slight de
clines in May and early June.
Credit Situation
During the past month there was a pause in
the rising trend of interest rates which has
been in progress since June, 1928, and rates
remained unchanged at the highest levels of
the past three years. During July the rapid
growth of total loans and investments of
reporting member banks which began in O cto
ber, 1927, was also checked, at least tempo
rarily. This easing of the credit situation
resulted from transfers of funds into this Dis
trict from other sections of the country and
from sales of securities by member banks.
Twelfth District reporting member banks
(all of which are city banks) have reduced their
loans and investments approximately 52 mil
lion dollars during the past four weeks. Invest
ments of these banks were reduced 31 million
dollars, the greater part of the reduction being
in government securities holdings. There was
also a slight drop (one million dollars) in their
commercial loans. The remainder of the de
cline in total loans and investments arose out
of reductions in security loans, principally in
loans to brokers and dealers in New York City
which resulted in transfers of funds into the
District. These movements in the loan and in
vestment account were accompanied by but a
56
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
relatively slight decline (8 million dollars) in
the deposits of reporting banks, and conse
quently there was a net gain of available bank
ing funds in the District. The banks used these
funds to increase their holdings of cash by 4
million dollars ; to reduce borrowings at the
Reserve Bank by 24 million dollars ; to increase
reserve deposits by 2 million dollars ; and to
supply an increased customer demand for curMILLIONS OF DOLLARS
M 1 L L I0 N S OF D O L L A R S
2¡00
900
July, 1929
excess— amounting to more than 2 million dol
lars— of United States Treasury disbursements
over collections within the District. Each of
these factors assisted member banks in reduc
ing their borrowings at the Reserve Bank. An
increase of 13 million dollars in money in cir
culation was met almost entirely by an in
crease of Federal Reserve notes issued, which
was made possible without increased borrow
ing from the Reserve Bank by the incoming
transfers of funds referred to above.
PER CENT
MILLIONS OF DOLLARS
-»560
1
■..1r ....
TOTAL B ILLS AND
SECUfCITIES
SECURI1■y LOANS,
600
—
500
300
'
Y
1
fco MMERX: ial
LOANS
11
DISCOLO
RATE
1927
1928
1929
1927
1928
iü
1929
I
C h a r t II
M E M B E R B A N K C R E D IT
C hart
X T '
M on th ly averages o f w eekly figures o f T w elfth D istrict reporting
m em ber banks. Latest figures are averages for the
first three report dates in July.
R E P O R T I N G M E M B E R B A N K S — T w elfth D istrict
T o t a l L o a n s and I n v e s t m e n t s .. .
T o t a l L o a n s .......................................
C o m m e r c ia l L o a n s ........................
L o a n s o n S e c u r itie s ......................
In v e s tm e n ts ........................................
N e t D e m a n d D e p o s it s .................
T im e D e p o s it s ..................................
B o r r o w in g s fr o m F e d e ra l R e s e r v e
B a n k ..................................................
-----Condii t io n ------June 19, M a y 15, July 18,
1929
1929
1928
1,849
1,984
1,961
1,319
1,241
1,353
880
897
922
361
422
431
608
631
642
786
781
785
937
984
997
979
July 17,
1929
1,932
1,332
921
411
600
778
33
57
40
54
Total Federal Reserve credit extended to
this District has declined continuously since
the peak months of February and March, 1929,
and during the week of July 17 approached the
lowest level of recent years. The Federal Re
serve Bank of San Francisco’s holdings of
acceptances and securities have also been cur
rently lower than at any time since 1923, hav
ing declined sharply since the opening of 1929.
The decline in Reserve Bank credit outstand
ing at the Federal Reserve Bank of San Fran
cisco during July was made possible by (a) a
net gain to this District of approximately 37
million dollars through transfers of funds from
other districts; (b) mint purchases of new gold
amounting to 2 million dollars; and (c) an
Tr
\
r
a .
A'Xv
—
120
F
»
«
TOTAL
DISCOUh
1
\
4 / BANK!EIRS
f ACCEPTAlNCES
1
C hart
rency. Reporting (city) member banks were
thus placed in a favorable position to meet the
needs for commercial credit which usually de
velop at the time of crop harvesting and mar
keting. Country member banks increased their
borrowings from the Reserve Bank approxi
mately 5 million dollars during the four weeks
ending July 17, largely to build up their reserve
accounts against deposits, a seasonal m ove
ment.
I
f f )
A
A
SO
40
x/
B IL L sV ^ *
BOUGHT
II I
U.
SECUFMTIES
1928
1929
C hart
IN T E R E S T R A T E S
1
1
IV
R E SE R V E BA N K C R E D IT
C H A R T I I I — R eserve Bank discou n t rate and averages o f prevailing
interest rates charged by banks in San F ra n cisco. Figures are as of
m iddle of each m onth, latest figures being for July.
C H A R T I V — M on th ly averages o f daily figures, F ed eral R eserve Bank
o f San F ra n cisco. Latest figures are averages for first 17 days in July.
During the four-week period, June 19 to
July 17, total earning assets of the Federal
Reserve Bank of San Francisco were reduced
24 million dollars. Discounts declined 19 mil
lion dollars, and bills bought in the open mar
ket were reduced 5 million dollars. The Re
serve Bank credit thus taken out of the market
had been extended mainly in other districts,
however, through Federal Reserve System pur
chase and allotment and indirectly by member
bank transfers of funds out of this District.
Consequently, its withdrawal represented rela
tively little reduction in accommodations to
banks or industries of the Twelfth District.
F E D E R A L R E S E R V E B A N K O F S A N F R A N C IS C O
(In millions of dollars)
July 17,
1929
T o t a l B ills and S e c u r it ie s . . . . .
68
B ills D i s c o u n t e d ......................
B ills B o u g h t .............................
9
U n ite d S ta te s S e c u r itie s . .
11
T o t a l R e s e r v e s ........................
T o t a l D e p o s it s ........................
F e d e ra l R e s e r v e N o te s in
------ C o n d ition --------June 19, M a y 15,
July 18,
1929
1929
1928
92
79
97
60
66
52
19
13
15
17
12
12
266
284
277
178
187
187
161
155
167
Effective July 16 this Bank’s buying rates
for bankers’ acceptances were reduced as follows :
Rates
t----------- E ffe c tiv e ------------- *
M aturities
1 - 4 5 d a y s ..............................................
4 6 -1 2 0 d a y s ................................................
1 2 1 -1 8 0 d a y s ..............................................
July 16,
1929
5H
5 Y\
5^
M a rch 21,
1929
5%
$V2
5H
@FedFRASER