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MONTHLY REVIEW OF B U S IN E S S C O N D IT IO N S ISAAC B. N EW TO N , Chairman of the Board and Federal Reserve Agent Federal Reserve Bank of San Francisco Vol. X I San Francisco, California, May 20,1927 No. 5 S U M M A R Y O F N A T IO N A L C O N D IT IO N S Prepared by the Federal Reserve Board Industrial output declined in April, reflect ing* reduced activity both in mines and in fac tories. Distribution of commodities by rail roads increased, as did trade at retail. The general level of prices showed a further slight decline. Production. Decreased output of industry in April, as compared with March, was due chiefly to the coal miners’ strike, which caused a large decline in production of bituminous coal. Manufacturing industries, as a whole, were somewhat less active in April than dur ing the previous month, when allowance is made for usual seasonal changes. Reductions were reported in the iron and steel and textile industries, as well as in meat packing and in production of building materials. The manu facture of m otor cars, though showing the usual seasonal increase in April, remained at a lower level than a year ago. Petroleum produc tion continued in record volume, notwith standing large stocks and declining prices. Value of building contracts awarded in April declined slightly from the record high figure of March, but was larger than a year ago. The decline in building between March and April reflected reduced activity in the construction of commercial, industrial, and educational build ings. Volum e of contracts for construction of residential and public buildings increased. On the basis of conditions on May 1st, the Department of Agriculture forecasts a winter wheat crop of 594,000,000 bushels, or about 5 per cent less than in 1926. Continued wet, cold weather over much of the corn belt and also in the spring wheat area has retarded the planting of spring crops. Trade. Commodity distribution at retail was larger in April than at the same season of any previous year, ow ing in part to the lateness of the Easter holiday. Department store sales were approximately 7 per cent larger than in April of last year, and sales of mail order houses and chain stores were also in large volume. W holesale trade showed about the usual decrease between March and April and continued smaller than in the corresponding month of 1926. Inventories of merchandise carried by de partment stores were in about the same volume at the end of April as in March, while stocks of wholesale firms were smaller than at the PER C E N T P E R CENT u \r A - à MINEF*ALS MAI NUFACTURI ES 1923 1924 1925 1926 1927 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 o f produ ction o f m anufactures and m inerals, ad justed for seasonal variations (1923-1925 average=11)0). Latest figures, A p ril, m anufactures, 109; m inerals, 107. D E P A R T M E N T STO R E SALES In dex o f Sales o f 359 Stores (1919 sales = 100). Latest figures, A p ril, w ith adjustm ent, 140, w ithout adjust ment, 143. 34 M O N T H L Y REVIEW OF BUSINESS CONDITIONS close of the previous month. Railroad carloadings were larger in April than is usual at this season of the year, reflecting chiefly large ship ments of iron ore, coke, grain, and grain prod ucts. A n increased movement of miscellaneous freight and of merchandise in less than carload lots was also reported. Coal shipments were 27 per cent smaller in April than in March. M ay, 1927 than $300,000,000 during the month ending May 18th, and was, on that date, at the highest level on record. This growth represented for the most part an increase in the banks’ hold ings of investments and in the volume of their loans on stocks and bonds. Their commercial loans showed relatively little change during this period. PER CENT I 9 2 3 1 9 2 4 19 2 5 19 2 6 1927 W H O L E S A L E P R IC E S In d ex o f U nited States B ureau o f L a b or Statistics (1913 prices = 100, base adopted by B u rea u ). Latest figure, A p ril, 144.2. Prices. In April there was a further slight recession in the general level of wholesale prices, as measured by the index of the Bureau of Labor Statistics, but in the first three weeks of May firmer price conditions were encoun tered. The decline in April reflected chiefly a decrease in the price of petroleum, lumber, and several of the non-ferrous metals. There was little change in the level of agricultural prices, which have been fairly constant since the be ginning of the year. During the first three weeks of May, prices of grains, cotton, iron and steel, petroleum, lumber, and hides advanced, while prices of livestock, coke, and non-fer rous metals declined. Bank Credit. V olum e of credit of weekly reporting member banks, as measured by their total loans and investments, increased by more M E M B E R B A N K C R E D IT M on th ly averages o f w ee k ly figures fo r banks in 101 leading cities. L atest figures are averages for first three w eek ly report dates in M a y. A t the reserve banks, there was a decrease during the month in total volume of credit out standing, owing to the receipt of a considerable amount of gold from abroad, in addition to the purchase abroad by the reserve banks of about $60,000,000 of gold, now held earmarked with a foreign correspondent. The banks’ holdings of acceptances and of government securities declined by about $85,000,000, while discounts for member banks increased by about $45,000,000, apparently in response to the increased reserve requirements arising from the growth in the member bank deposits. Conditions in the money market were com paratively stable during the first three weeks of May, and there were no changes in rates quoted on prime commercial paper and on ac ceptances. 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 In the Tw elfth Federal Reserve District, general business activity expanded by more than the usual seasonal amount during April, 1927, and was at higher levels than in April, 1926. The district’s industries did not partici pate in this movement, even to the extent of the usual seasonal increase, although industrial output approximated that of a year ago. Sub stantial gains in volum e of distribution and trade were reported, however, both as com pared with March, 1927, and April, 1926. M ost evident among the signs of trade ex pansion during April was the growth in value of sales at retail which, partly in consequence of a relatively late Easter buying period, in creased 4 and 9 per cent as compared with one month and one year ago. W holesale trade was in but slightly greater volume than in April of last year. Daily average railway freight carloadings, a measure of physical volume of dis tribution, showed an increase over the year period, the result of increases reported for Arizona, California, and Nevada. The number of railway carloadings in the Pacific Northwest was 5 per cent smaller in April, 1927, than in April, 1926. This bank’s seasonally adjusted index of daily average bank debits advanced slightly during April and was above the figure of a year ago. B A N K D E B I T S * —T w e lfth D istrict M a r., F e b ., A p r., 1927 1927 1927 161 161 W ith S e a s o n a l A d ju s t m e n t . . . 164 182 W it h o u t S ea s o n a l A d ju s t m e n t 167 173 A p r ., 1926 150 150 M a r., 1926 150 159 D a ily a v e r a g e , 1919 a v e r a g e = 1 0 0 . INDEX B A N K D E B IT S -T W E L F T H acreage remaining for harvest, and the per cent of acreage abandoned: W IN T E R W H E A T f D IS T R IC T la d ex for 20 principal cities, Ph oenix, A r iz o n a , not included (daily averages, 1919 average = 100). Latest figures, A p ril,w ith ______ adjustm ent, 164; w ithout adjustm ent, 167. *Based upon average month to month increase during the years 1919 to 1926 inclusive.. Soundness continued to characterize the banking and credit situation in the district. Condition statements of member banks have revealed only mild seasonal changes, and de mands upon the Federal Reserve Bank of San Francisco have declined. The trend of prices continued downward during April, although advances in prices of some of the district’s important agricultural products were recorded during the latter part of that month and early in May. Agriculture Cold weather and heavy rains during late April delayed an already late agricultural sea son, but warmer temperatures during early May have favored growth of crops and of range feed. Abandonment of winter wheat during the present season has been larger, in proportion to the acreage planted, than a year ago. The acre age sown in the district was considerably larger than last year, however, and estimated produc tion, as indicated by condition figures of May 1, 1927, is 19.5 per cent larger than a year ago. The follow ing table gives condition estimates, -C ondition---------- \ (P er C en t 10-Y ea r* o f N orm al) A v era ge M a y 1, (P e r C e n t 1927 1926 o f N o rm a l) 90 100 94 91 88 82 90 97 87 98 92 98 92 97 93 92 99 95 92 87 91 . .. . . . , . U ta h ............... . W a s h in g t o n . . T w e lfth D is t r ic t . .. U n ite d S ta te s . ’ 85’. 6 C a lifo rn ia *1917-1926. NUMBERS 35 FEDERAL RESERVE AG EN T A T SAN FRANCISCO M a y , 1927 84.0 83.7 r~~ A c r e a g e f— \ T o be har vested 1927 41 749 512 5 900 149 1,250 3,606 38,701 H ar vested 1926 38 653 427 5 880 149 847 2,999 36,913 P erC en t i o f AcreageJ Sow n A b a n d on ed -----M a y ----- \ 1927 1926j 3.0 1.0 4.0 3.0 4.0 2.5 0.0 1.0 3.0 2.0 2.0 2.0 2.5 6.0 t 8.4 5.6 1000 o m itte d . In California and in the fruit producing sec tions of the Pacific Northwest, late frosts have materially injured deciduous fruit crops, but, because of the lateness of the season, an accu rate estimate of condition of deciduous fruits is not yet possible. California citrus fruits are re ported to be in excellent condition. Shipments of oranges and lemons from California during April, 1927, totaled 7,343 and 1,373 carloads, respectively, compared with 5,834 and 1,121 carloads a year ago. Estimated production of the 1927 Valencia orange crop is 14,300,000 boxes, as compared with 11,260,000 boxes shipped during 1926. The United States Department of Agricul ture estimates that on May 1, 1927, the con dition of the hay crop in all states of this dis trict was slightly below that of a year ago. A late spring, which has delayed growth of the 1927 crop of hay and other feed, has also made considerable feeding of livestock necessary, and this in turn has reduced the carryover of hay on farms of the district as compared with stocks held in 1926. The presence of an ade quate supply of soil moisture in most range areas gives promise of good summer range con ditions. Condition figures for livestock and ranges are shown in the follow ing table: C O N D IT IO N O F R A N G E S A N D L IV E S T O C K (P e r C e n t o f Estim ated N orm al) A r iz o n a C a lifo rn ia . .. . . . . U ta h ............ . W a s h in g t o n . . S ource: Ranges-------- \ M a y 1, A p r . 1, 1927 1926 1927 89 110 90 98 94 99 81 95 86 100 84 91 89 103 87 89 100 91 89 92 90 Cattle--------% / M a y 1, A p r . l , 1927 1926 1927 89 98 89 95 95 93 87 99 91 87 99 89 90 106 88 90 105 92 88 93 90 SheepM a y l, A p r .l. 1927 1926 1927 95 95 99 95 95 94 100 92 87 91 92 101 92 88 106 94 105 91 92 99 93 U n it e d S ta te s D e p a r tm e n t o f A g r ic u ltu r e . W o o l shearing is nearing completion under favorable weather conditions, in the sheep rais ing sections of the district. Fairchild’s estimate of the 1927 domestic wool clip of the United States, at 281,310,000 pounds, is 4.3 per cent larger than the clip of 1926. Field buyers of wool have not been active during April and May, and there has been considerable shipment of w ool to Boston on consignment. The con tract price for w ool has ranged from 28 to 33 cents per pound, which is 2 to 5 cents lower than a year ago. Shipments of California spring lambs to Eastern markets totaled 269,496 head for the season to M ay 13, 1927, as compared with 173,368 head for the season to May 15, 1926. E x cellent feed conditions in California have made it possible to market a better grade of lambs than was possible a year ago. There were 97,410 head of cattle and calves shipped to the eight principal markets of the district during April, 1927, as compared with 93,805 head during April, 1926. Improved prices for cattle are reflected in the follow ing table : W E E K LY A V E R A G E PRICE OF CATTLE* , -------------------W e e k L o s A n geles. .................................... O g d e n ................................................ P o r t la n d ............................................ S a lt L a k e C i t y ................................ S an F r a n c is c o ................................ A p ril 30, 1927 $9.09 8.80 10.29 8.80 9.06 E n d in g 1 M a y 2, A p ril 30, 1925 1926 $9.06 $8.65 8.50 8.00 9.95 8.26 8.00 8.50 9.50 8.50 * G o o d g r a d e ste e rs, 1,100 p o u n d s o r u n d e r, as q u o t e d 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 . b y the Industry Reports of industrial activity received by this bank during April, 1927, were somewhat con tradictory in character. Available data indi cate, however, that, in the aggregate, indus trial output and volume of employment did not experience the full seasonal expansion usually noted during April, although approxi mating the levels of a year ago. V olum e of employment in California was larger during April, 1927, than during April, 1926. In the Pacific Northwest, however, volume of employment is estimated to have been smaller than a year ago, a result chiefly (A) Employment-California .... r ~ — Oregon ----------- \ No. of No. of t— Employees —> No. r—Employees —> No. Apr., Apr., Apr., of Apr., of 1927 1926 Firms 1926 Industries Firmsi 1927 28.337 31,219 All Industries.......... 787 153,946 149,899 174 (-9 .2 ) (2.7) S to n e , C la y a n d 414 364 6,439 6 7,135 G lass P r o d u c t s . 47 L u m b e r an d W o o d M a n u fa c tu r e s . . (1 0 .8 ) 127 24,673 ( — 11.0) 2,551 18 ( — 2 .0 ) 27,719 T e x t i l e s .................... C lo th in g , M illin e ry 62 an d L a u n d e rin g . F o o d s , B e v e ra g e s an d T o b a c c o . . . 176 W a te r , L ig h t and 5 P o w e r ................. 2,604 8,243 (6 .2 ) 33,775 (1 7 .3 ) 7,528 — 1 5.8) ( O th e r I n d u s t r ie s !. 340 68,034 ( 3 .9 ) 2,007 12 M is c e lla n e o u s . . . . ( — 6 .7 ) 7,765 28,792 (1 3 .7 ) 17,422 63 (-— 11.9) 2,107 13 ( — 16.3) 479 9* (2 .1 ) 1,890 48 (0 .6 ) 19,766 2,518 469 1,879 8,937 65,492 2,151 35 6,025 ( — 3.2) 6,223 * L a u n d e r in g o n ly , f l n c l u d e s th e f o llo w in g in d u s t r ie s : m etals, 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 and r u b b e r g o o d s ; c h e m ic a ls , o ils and p a i n t s ; p r in t in g and p a p e r g o o d s . Figures in parentheses indicate percentage changes from April, 1926. M ay, 1927 M O N T H L Y REVIEW OF BUSINESS CONDITIONS 36 of curtailed operations in the lumber industry, one of the most important industries in that section. Building operations, as indicated by build ing permits issued, continued during April, 1927, at levels below a year ago. The value of permits issued in 20 principal cities of this dis trict was less during April, 1927, than during April, 1926, and was smaller than in any other April since 1922. As compared writh last month, value of building permits issued during April, 1927, increased slightly, but the increase was not so great as the average March to April in crease recorded since 1919. Large gains in value of proposed construction during April, 1927, as compared with both March, 1927, and April, 1926, were reported for Phoenix, A ri zona, Boise, Idaho, Portland, Oregon, and Spo kane, W ashington, but the increases for the year period were more than offset by substan tial declines in Los Angeles, Oakland, and San Francisco, California, and Seattle, W ashington. B U IL D IN G PERMITS IN 20 CITIES Per C ent Increase or Decrease (— ) Months in 1927 compared with same Months in 1926 Monthly Year-to-date No. Value No. Value — 6.6 A p r i l ............ M a r c h .......... — 10.7 F e b r u a r y ... — 13.2 J a n u a r y ... . — 15.5 — — — — 4.5 8.9 14.4 16.5 — — — — 11.3 12.9 14.4 15.5 —10.6 — 12.9 — 15.5 — 16.5 Month in 1927 compared with preceding Month No. Value — 9.5 41.1 — 1.9 3.6 1.3 44.5 — 6.0 — 19.2 Building materials prices, as reflected by the index of the United States Bureau of Labor Statistics, continued their downward trend during April, a result chiefly of lower prices for lumber. A ccording to this index, which for April stood at 165.0 (1913 prices= 100 ), build ing materials costs were then at the lowest point since May, 1922 (160.6). In April, 1926, the index stood at 173.0. In April, 1927, for the third consecutive month, the Aberthaw index of industrial building costs, including both labor and materials, stood at 193 (1914 p r ice s = 100). A year ago this index stood at 199. (B) Building Permits— April, 1927 No. N Value B e r k e le y .............. B o is e ...................... F r e s n o ................. L o n g B e a ch . . . L o s A n g e le s . . . O a k la n d .............. O g d e n .................. P a sa d e n a ............ P h o e n ix ............... P o r t la n d .............. R e n o ...................... S a c r a m e n to . . . . Salt L a k e C it y . . S an D ie g o .......... San F r a n c is c o . San J o s e ............ S e a ttle ................... S p o k a n e ............... S tock ton ............ T a com a ............... April, 1926 No. Value 206 100 109 453 3,296 796 37 245 87 1,085 29 212 146 555 964 100 962 252 78 143 $ 600,319 198,620 306,083 1,133,440 10,458,622 1,891,716 161,800 814,332 1,375,383 4,022,170 75,750 491,556 462,565 2,008,444 4,939,212 256,325 3,181,555 490,020 302,168 314,890 254 84 95 335 3,332 1,010 46 213 90 1,213 24 247 147 679 981 122 1,031 276 91 286 9,855 $33 ,484,970 10,556 $ 642,100 55,822 186,921 490,190 11,207,289 2,134,179 183,250 948,839 149,653 3,176,370 110,700 1,349,576 923,015 1,596,560 7,299,451 6 11,730 2,534,130 393,580 247,676 817,125 $3 5 ,058 ,15 6 M a y , 1927 Lumbering operations expanded by less than the usual seasonal amount during April, 1927, as compared with March, 1927, and are re ported to have been considerably smaller in volume than a year ago. In every year since 1920, according to data reported by mills of the district to The National Lumber Manufactur ers Association, annual output of lumber has exceeded shipments which in turn have ex ceeded orders received. This tendency per sisted throughout 1926 and, within the district, wherein is consumed approximately 50 per cent of the lumber produced here, was accom panied by a decline in demand for lumber. In ventories were accumulated at mills and prices declined to unsatisfactory levels. Unsatisfac tory lumber prices are reported to have forced many high cost mills to cease operation. Other mills, more favorably situated, curtailed pro duction during the winter months and output declined sharply to levels below those of a year ago, where it has since remained. Since D e cember, 1926, output has been smaller than both shipments and orders, and some diminu tion of inventories has been reported. A p r .,1927$ (board feet) P r o d u c t io n ____ 515,321 S h ip m e n ts .......... 621,641 O rd e rs ................. 600,877 U n fille d O r d e r s ! 438,525 N o . o f M ills R e p o r t in g ? . . 145 LUM BER* r -F ir s t F ou r M o n th s— M ar., 1927 A p r., 1926 1927 1926 (board feet) (board feet) (board feet) (board feet) 491,655 812,316 1,893,578 2,609,064 589,061 788,887 2,227,462 2,753,379 620,492 751,192 2,330,680 2,793,579 458,565 553,076 .................................... 147 183 151 183 * A s r e p o r te d b y fo u r a s s o c ia tio n s , 000 o m itte d e x c e p t in c a se o f n u m b e r o f m ills r e p o r tin g . f R e p o r t e d b y th ree a s s o c ia tio n s . T h e figu res are n o t s t r ic t ly c o m p a r a b le w ith o th e r fig u re s a p p e a r in g in the ta b le . Î A v e r a g e . § F ig u r e s n o t s t r ic t ly c o m p a ra b le w ith th o s e r e p o r te d a y e a r a g o . S o u r c e : N a tio n a l L u m b e r M a n u fa c tu r e r s A s s o c ia t io n . Figures of national non-ferrous metal pro duction, together with a guide to the propor tionate importance of this district in such pro duction, are presented in the follow ing table : N O N -F E R R O U S M E T A L S p ® 'C e“ t N ational P rodu ction P rodu ced in A p r ., M a r., A p r ., 12th D ist.* C o p p e r (s h o r t t o n s ) (m in e 1927 1927 1926 in 1926 p r o d u c t io n ) ..................... 70,552 68,881 73,006 64.1 L e a d ( s h o r t t o n s ) (c r u d e ) t 61,237 61,365 55,347 43.50 Z in c (s h o r t t o n s ) ( s l a b ) . 51,626 56,546 53,334 13.3 S ilv e r ( o z .) (c o m m e r c ia l b ars) ..................................4,310,000 5,131,000 4,954,000 69.7 * I n c lu d in g all o f A r iz o n a , the five s o u th e a ste rn co u n tie s o f w h ich are in the E le v e n th F e d e ra l R e s e r v e D is tr ic t. ^ R evised , f ln c l u d e s fig u res fo r M e x ic o . Follow ing four months of declining produc tion, average daily output of petroleum at Cali fornia wells increased slightly during April. Indicated average daily consumption of crude oil during April was 4.0 per cent less than in March, and stored stocks at the end of April were 0.5 per cent larger than at the beginning* of the month. Indicated average daily con sumption during April, 1927, was 5.0 per cent greater than in April a year ago. Although the number of new wells brought into production has been smaller during the first four months of 1927 than during the corresponding period 37 fe d e r a l re serv e a g e n t a t san fra n c isc o of 1926, the total flow of crude oil from such wells has been greater. An average of 89 new wells were opened each month during the period January through April, 1927, with an average initial daily output of 49,341 barrels of petroleum. During the first four months of 1926, there was an average of 93 new wells brought in each month, but the average initial daily production of new wells during that period was only 27,112 barrels. PETROLEUM—California Indicated Average Stored /— New Wells Average Daily Stocks at Daily Daily Consumption End of Number Produc* Production (Shipments) Month Opened tion A p ril, M a r., A p ril, 1 9 2 7 .. . 1 9 2 7 .. . 1 9 2 6 .. . (barrels) (barrels) (barrels) 648,870 629,918 119,085,070 105 639,862 656,143 118,516,525 79 603,059 599 ,789 * 124,685,080 95 (barrels) 81,432 40,552 24,267 * E x clu d e s fire lo s se s d u r in g A p ril, 1926, eq u iv a le n t to 273,829 b a rrels d a ily . S o u r c e : A m e r ic a n P e tr o le u m In s titu te . Output of flour, as reported to this bank by 14 milling companies, was larger in volume during April, 1927, than during April, 1926, and exceeded the five-year (1922-1926) average output for that month by 15 per cent. Mills wrere less active during April, 1927, than dur ing March, 1927, but the decline was not so great as that which usually occurs at that sea son of the year. Output during April was ap proximately 14 per cent smaller in volume than during March, compared with an average March to April decrease of 20 per cent during the five years 1922-1926, inclusive. Stocks, both of flour and of wheat, in millers’ hands de clined during April but were larger than at the close of April a year ago. Stocks of flour were smaller, however, than average April 30th holdings during the past five years. FLOUR M IL LIN G * Apr., 1927 O u tp u t ( b b ls .) . . . 394,912 S tock st F lo u r ( b b l s . ) . . . 415,284 W h e a t ( b u . ) . . . 2,164,092 Five-Year Average April, 1922-1926 Mar., 1927 Apr..1926 461,617 371,473 342,948 449 ,286 2,429,973 375,133 1,942,454 495,197 1,965,691 C o n s o li d a t i o n s h a ve r e d u c e d th e n u m b e r o f r e p o r tin g c o m p a n ie s b u t h a ve n o t s e r io u sly a ffe cte d th e co m p a r a b ility o f the fig u res, f A t en d o f m o n th . Distribution and Trade Distribution and trade in the Twelfth Fed eral Reserve District were in greater volume during April, 1927, than during April, 1926, and, if allowance be made for usual seasonal movements, were more active than in March, 1927. Retail sales during April, 1927, as reported by 120 stores in seven lines of trade, were ap proximately 4 per cent larger in value than in March, 1927, and were 9 per cent larger than in April, 1926. Increases were shown in sales of each of the seven lines upon which this bank compiles data, although in some lines the in creases were, no doubt, caused by the relative M O N T H L Y REVIEW OF BUSINESS CONDITIONS 38 lateness of Easter buying this year, as com pared with last year. Total reported sales of 43 department stores were 5.2 per cent greater in value during April than during March whereas, ordinarily, there is but little differ ence in value of sales as between these two months. Sales of the 43 department stores were 11 per cent larger than in April a year ago. Stocks of 74 stores were but 0.7 per cent larger in value at the close of April, 1927, than at the close of April, 1926, and stock turnover of reporting stores was more rapid than a year ago in all lines except furniture and w om en’s apparel. Percentage changes in sales and stocks of all reporting retail stores are shpwn below, and index numbers of sales of 32 stores, chiefly de partment stores, for which data have been com piled since 1919, are shown in Table “ D .” ,----------N ET SALES*--------- * January I to April, 1927 April 3 0 , 1927 compared compared with with same period April, 1926 in 1926 D e p a r tm e n t S to r e s . . D r y G o o d s .................... F u rn itu r e ....................... M e n ’ s and W o m e n ’ s A p p a r e l ...................... S h o e s ............................... W o m e n ’ s A p p arel . . . A ll R e p o r t in g S t o r e s f ............ r -S T O C K S ^ End of Month, April, 1927 compared with April, 1926 11.0 ( 4 3 ) 12.4 ( 7) 0.8 ( 61) 4.3 ( 3 8 ) 8.7 ( 6) 3.3 ( 33 ) — — 0.4 (3 6 ) 3.9 ( 4) 3.3 (1 7 ) 15.8 ( 10) 13.6 ( 2 2 ) 5.9 ( 11) — 1.4 ( 1 0 ) 2.2 ( 6) 7.1 ( 11) 16.1 (1 0 ) 9.2 (1 2 0 ) 4.3 (1 0 4 ) 0.7 (7 4 ) * P e r c e n t a 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 ren th eses in d ica te n u m b e r o f s to r e s r e p o r tin g . F ig u r e s o f id e n tica l d ep a rtm e n ts o f d e p a rtm e n t s to r e s r e p o r t in g s u ch figu re s sep a r a te ly in c lu d e d in sales c o m p a r is o n s o f fu rn itu re and sh o e sto re s, A p r il, 1927, w ith A p r il, 1926. f I n c l u d e s fig u res o f m e n ’ s fu r n is h in g s s to r e s n o t s h o w n se p a ra te ly . Value of sales at wholesale during April, 1927, as reported to this bank by 215 firms in 11 lines of trade, approximated the figures of a year ago, and was but 2.3 per cent smaller than in March, 1927. The March to April decline was less than that which usually occurs at this season of the year. Increased sales, as com pared with April of last year, were reported in (C) Bank Debits* — B e r k e l e y ............ B o is e .................. F r e s n o ............... L o n g B e a ch . . . L o s A n g e le s . . O a k la n d ............ O g d e n ................ P a sa d e n a .......... P h o e n ix ............ P o r t la n d .......... R e n o ................... S a c r a m e n to . . . S alt L a k e C ity . San D ie g o San F r a n c is c o San J o s e .......... S ea ttle ............... S p o k a n e ............ S to ck to n .......... T a c o m a .............. Y a k im a .............. D is t r ic t ......... .$3,3 63,791 *000 om itte d . r -F ir s t F ou r M o n th s — A p ril, 1927 A p ril, 1926 1927 1926 .$ 22,201 $ 19,504 $ 86,293 $ 78,609 12,910 11,950 51,683 50,545 40,694 36,418 161,577 143,565 54,860 56,027 204,198 219,650 863,984 3,939,358 3,566,899 . 954,235 228,179 891,564 168,264 684,043 17,017 73,897 15,322 88,644 44,776 38,163 175,245 158,637 28,563 26,007 112,330 103,289 . 171,307 642,212 173,443 680,573 8,517 8,584 33,867 33,588 33,293 29,368 116,546 132,764 70,384 73,051 273,318 285,146 265,971 63,432 69,925 265,863 . 1,228,689 1,041,377 4,846,579 4,455,517 24,890 103,116 99,185 24,668 . 222,331 221,119 815,337 836,778 56.150 219,986 57,958 216,466 107,142 24,541 107,764 26436 45,887 48,796 180,027 185,250 12,630 13,286 48,994 49,437 $3,025,345 $13,349,132 $12,442,320 M a y , 1927 seven lines, while the other four showed de creases ranging from one per cent in sales of groceries to 9 per cent in sales of furniture. Dry goods and hardware jobbers continued to re port declines in dollar value of sales over the year period, a characteristic of wholesale trade reports for the past five months. Decline in value of sales in these lines over the year period is not, however, necessarily indicative of a smaller volume of trade, inasmuch as the United States Bureau of Labor Statistics’ in dexes of wholesale prices of those commodities handled by dealers in each of these lines have for some time been several points lower than were the indexes of twelve months ago. Prices of automobile tires during April, 1927, were considerably below those of April, 1926, but an average increase of one per cent in dollar value of sales was reported by 24 co-operating firms. W H O L E SA L E T R A D E Percentage increase or decrease (—) t----------- in Value of Sales------------ Apr., 1927 Apr., 1927 Mar.,192i compared compared compared No. of with with with Firms Apr., 1926 Mar., 1927 Mar.. 192f A g r ic u ltu r a l Im p le m e n ts , 15 6.4 — 8.7 — 13.2 A u t o m o b ile S u p p lie s . . . . A u t o m o b ile T ir e s ........... .. D r u g s ................................... .. D r y G o o d s ......................... .. 24 24 7 31 11 17 G ro c e r ie s ................................ 28 H a r d w a re .............................. 22 S h o e s ....................................... 13 P a p e r and S t a t io n e r y . . . . 23 A ll L in e s ............................. 215 — — — — 2.4 1.0 3.3 3.7 4.8 8.7 1.0 4.5 9.1 15.0 0.2 — — — — — — — 1.4 7.3 1.9 5.7 3.3 17.9 2.3 2.1 8.0 5.0 2.3 — 0.5 — 1.8 2.8 9.6 4.4 — 2.5 — 0.3 — 4.8 — 4.9 2.7 — 2.8 — e of foreign commerce passof the Twelfth Federal Reserve District during the first three months of 1927 was approximately the same as during the first three months of 1926. Exports were larger in value than during the first quarter of any year since 1920 and were 10 per cent larger than in the first quarter of 1926. Imports were 8 per cent smaller than a year ago and ex ceeded exports by only 7.6 per cent. In the first quarter of last year, the excess of imports over exports was 28 per cent. A 40 per cent increase in exports from Los Angeles and an 18 per (D ) D EPAR TM EN T STORE SALES—Index Numbers! Los Angeles Oak land ( 6 )* (5)* San Fran cisco (8)* Salt Lake City (4)* Seattle (5)* Spo kane Dis trict (3 )* (3 2 )* Without Seasonal Adjustment A p r il, M a r., F e b ., Jan ., D e c ., A p r il, 1 9 2 7 .. 1 9 2 7 .. 1 9 2 7 .. 1 9 2 7 .. 1 9 2 6 .. 1 9 2 6 .. . . . . . . 254 254 196 230 411 222 161 147 117 130 286 144 146 139 108 115 247 134 106 97 79 87 198 106 109 99 79 81 193 102 99 89 73 69 165 95 164 159 124 138 281 150 152 140 141 130 154 139 113 106 110 105 127 113 115 107 122 107 122 108 103 106 107 96 109 98 170 164 162 157 180 155 With Seasonal Adjustment A p r il, M a r., F e b ., Jan ., D e c ., A p r il, 1 9 2 7 .. 1 9 2 7 .. 1 9 2 7 .. 1 9 2 7 .. 1 9 2 6 .. 1 9 2 6 .. . . . . . . 263 254 242 243 272 229 166 157 155 152 171 149 ^ F ig u r e s in p a re n th e se s in d ica te n u m b e r o f sto re s. O n e store in c lu d e d in d is tric t fig u re s n o t in c lu d e d in c itie s s h o w n ab ove, ! 1 919 m o n t h ly a v e r a g e = 1 0 0 . M a y , 1927 cent decrease in imports into Seattle were re ported during the first three months of this year as compared with the first three months of 1926. F O R E I G N C O M M E R C E — T w elfth D istrict E xports* C u stom s January 1 to M a rch 31, D istricts 1927 1926 $21,032 L o s A n g e le s .......... $29,425 O r e g o n ...................... 11,160 12,286 46,297 43,338 San F r a n c i s c o ____ W a s h in g t o n ............ 33,190 32,486 D is t r ic t ................ $120,072 $109,142 C alend ar Y e a r 1926 1925 $ 99,708 $ 71,792 78,422 41,925 187,165 183,014 147,582 120,559 $512,877 $417,290 C alendar Y e a r 1926 $ 42,130 13,720 210,185 261,936 1925 $ 38,732 12,431 197,375 262,171 Im ports* C u stom s January 1 to M arch 31, D istricts 1927 1926 L o s A n g e le s .......... $ 8,945 $11,350 O r e g o n ...................... 3,602 2,993 60,540 57,429 S an F r a n c i s c o ____ W a s h in g t o n ............ 56,106 68,826 D is t r ic t ................ $129,193 $140,598 $527,971 $510,709 *000 om itte d . Prices Irregularity characterized price movements of April and early May but the general trend continued downward. The United States Bureau of Labor Statistics’ index of prices of 404 commodities at wholesale declined to 144.2 (1913 prices=100) during April, 1927, com pared with 145.3 for March, 1927, and 151.1 for April, 1926. O f those group indexes composing the general index, declines were registered dur ing the month by the fuels, metals, building ma terials and miscellaneous groups while group indexes of farm products, foods, cloths and clothing, and chemicals and drugs advanced. The house furnishings group was unchanged. I N D E X N U M B E R S O F W H O L E S A L E P R IC E S B Y G R O U P S O F C O M M O D IT IE S (1913 = 100). G rou p A ll C o m m o d itie s ............ F a rm P r o d u c t s ................ . , F o o d s ................................... . . C lo th s an d C l o t h i n g . . . . F u e l an d L i g h t i n g .......... . . M e ta ls .................................. . B u ild in g M a te ria ls C h em ica ls and D r u g s . . , H o u s e F u rn ish in g s . . . . 39 FEDERAL RESERVE AG EN T AT SAN FRANCISCO A p ril, M a rch , Febru ary, January, A p ril, 1927 1927 1927 1927 1926 144.2 145.3 146.4 146.9 151.1 136.7 136.6 136.9 137.2 144.9 147.1 148.2 153.2 147.3 149.6 169.1 168.4 168.7 176.8 167.3 177.1 174.0 160.6 168.3 179.8 121.9 124.4 122.8 122.2 126.5 173.2 166.8 167.9 169.7 165.0 122.0 122.1 130.3 121.8 120.7 157.4 163.4 157.4 157.4 157.5 126.5 118.6 117.9 118.5 Prices paid to farmers for farm products were slightly lower during April, 1927, than during March, 1927, according to the United States Department of Agriculture. The decline in farm prices was not so great as the decline in prices of non-agricultural commodities, how ever, and the purchasing power of farm crops is estimated to have increased fractionally during the month. The United States Department of Agriculture’s index of prices for farm products at the farm declined from 126 in March (August, 1909-July, 1914 prices=100) to 125 in April, 1927, and the Bureau of Labor Statistics’ in dex of non-agricultural commodities declined from 152.9 (1909-1914 prices=100) to 150.9. The ratio between these two indexes, an indi cation of the purchasing power of farm prod ucts, stood at 82.8 for April, 1927 (pre-war purchasing p ow er= 100), compared with 82.4 for March, 1927, and 87.8 in April, 1926. Livestock quotations at Chicago averaged higher during April, 1927, than during March, 1927, and April, 1926, with the exception of prices for hogs which continued to decline. Monthly average prices and percentage changes are shown in the following table: L I V E S T O C K P R IC E S A T C H I C A G O (Monthly averages per 100 pounds) Percentage changes from A p ril, M a rch , A p ril, O n e M onth O ne Y ea r 1927 1927 1926 Ago Ago $11.00 $10.62 $ 9.46 + 3.6 + 16.3 11.47 — 3.5 10.77 12.05 — 10.6 8.09 8.35 + 9.6 + 6.2 8.87 15.66 14.94 + 4.8 13.15 + 19.1 H ogs S heep Influenced by weather conditions in the wheat sections, the market for wheat during recent weeks has been somewhat unsettled. Price declines of early April were more than offset, however, by advances during the latter weeks of April and early weeks of May. For the week ending May 6, 1927, quotations for September contract wheat at Chicago ranged from $1.31 ^ to $1.32% per bushel, compared with a range of from $1,275^ to $1.28 a month ago, and $1.33% to $1.35 per bushel a year ago. On May 19, 1927, quotations for this grade of (E) Commodity Prices— C om m od ity W h o le s a le P r ic e s ( U . S. B u rea u o f L a b o r ) 1 9 1 3 = 1 0 0 .......... .................... P u r c h a sin g P o w e r o f F a rm P r o d u c t s ( U . S. D e p t, o f A g r ic u lt u r e ) * C a ttle (N a t iv e B e e f ) . .W e e k ly a v e r a g e p r ic e at C h ic a g o ........................... H o g s .................................. W e e k ly a v e r a g e p r ice at C h ic a g o ..................................... W h e a t ............................... C h ic a g o c o n t r a c t p r ic e fo r S e p te m b e r w h e a t ............ W o o l .................................. A v e r a g e o f 98 q u o ta tio n s at B o s t o n ................................. O r a n g e s ............................N avels, F a n c y , w h o le sa le at San F r a n c is c o ................ P r u n e s ................................S iz e 4 0 /5 0 in 25-lb . b o x e s , f. o . b. C a lifo r n ia ............. R a is in s ................................T h o m p s o n S e e d le s s , b u lk , in 25-lb . b o x e s , f. o. b. C a n n ed P e a c h e s ............ C h o ic e C lin g , s lic e d , 2}4s, B u t t e r ................................92 s c o r e at S an F r a n c is c o . L e a d .................................... M o n t h ly a v e r a g e at N e w Y o r k ...................... ........... S i l v e r ..................................M o n th ly a v e ra g e at N e w Y o r k ................................... L u m b e r ( S o f t w o o d ) . .W e e k ly In d e x , U n ite d S t a t e s ! .................................... U nit 100 lb s. 100 lbs. 100 lbs. bu . lb. box lb . lb . doz. lb . lb . lb . o z. M a y 6,1927 144.2 82.8 $11.00 16.25 10.15 1 .3 1 ^ -1 .3 2 ^ 64.440 $ 4 .5 0 -5 .0 0 .07y4- .0 7 t t O n e M on th A g o 145.3 82.4 $10.90 15.75 10.90 1 . 2 7 ^ -1 .2 8 65.440 $ 4 .2 5 -4 .5 0 .07—.07 5^ .07^2 1 .8 5 -2 .1 0 .41 12.8080 7.1260 56.3990 30.52 .0 7 ^ 1 .8 5 -2 .1 0 .42 13.0790 7.5770 55.3060 30.52 O ne Y ear Ago 151.1 87.8 $9.30 14.70 12.80 1 .3 3 ^ - 1 .3 5 67.770 $ 4 .5 0 -5 .0 0 m y 2 -.Q9yA .0 7H '2 .2 0 -2 .3 5 .40 13.7060 7.9710 64.4090 31.52 *Ratio of Farm Prices (August, 1909-July, 1914=100) to wholesale prices of non-agricultural commodities (1910-1914= :100). tA s published by “ The Lumber Manufacturer and Dealer.” 40 M a y , 1 927 M O N T H L Y REVIEW OF BUSINESS CONDITIONS wheat ranged slightly higher (from $1.34^4 to $1.36^ per bushel), and were higher than on May 19, 1926 (from $1.30*4 to $1.31%). Cotton prices advanced steadily during April, 1927, continuing an upward movement in progress since late February, but ranged considerably lower than during April, 1926. Quotations for spot middling uplands cotton at New Orleans during the week ending May 6, 1927, ranged from 14.86 to 15.42 cents per pound, compared with a range of from 14.12 to 14.31 cents per pound a month ago, and 17.89 to 18.02 cents per pound a year ago. The aver age of daily quotations for the month of April, 1927, was 2 per cent higher than for March, 1927, but approximately 20 per cent lower than for April, 1926. An average of 98 wool quota tions on the Boston market declined to 64.44 cents per pound during April, 1927. A month ago it stood at 65.44 cents, and a year ago at 67.77 cents per pound. During March and early April, competitive conditions resulted in sharp declines in gaso line prices in California. Early in May, how ever, prices were again advanced to levels but slightly lower than those prevailing before the reductions were made. Price changes, made by important factors in the industry during recent months, are shown in the follow ing table: vestment holdings, and at the same time to re duce their borrowings from the Federal R e serve Bank of San Francisco. REPORTING M EM B ER BAN K S— Twelfth District (In millions of dollars, percentage changes in parentheses) Condition /---------- Changes from ----------> May 18, One Month One Year 1927 Ago Ago T o t a l L o a n s ................................ 1,312 C o m m e rcia l L o a n s ................. 974 337 L o a n s o n S e c u r itie s ............ In v e s tm e n ts ................................ 507 T o t a l L o a n s and In v e s tm e n ts 1,819 N e t D e m a n d D e p o s i t s .......... 788 T im e D e p o s it s ........................... 963 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 ...................... 33 (+ +13 + 9 + 3 + 1 +13 + 5 +20 = ( ( ( ( ( ( ( increase. 1.0 ) 1.0 ) 0 .9 ) 0 .1 ) 0 .7 ) 0 .6 ) 2 .2 ) — 13 (2 8 .6 ) — = decrease.) + 1 0 9 ( 9 .1 ) + 73 ( 8 .1 ) + 36 (1 2 .1 ) + 33 ( 6 .8 ) + 1 4 2 ( 8 .4 ) + 24 ( 3 .2 ) + 1 2 8 (1 5 .4 ) — 1 ( 2 .7 ) Total earning assets of the Federal Reserve Bank of San Francisco declined by 22 per cent (26 million dollars) during the four weeks end ing May 18, 1927, and on the latter date were 20 per cent smaller than on May 19, 1926. All MILLIONS OF DOLLARS G A SO L IN E PRICES— California (Tank Wagon) 1927 M arch 1 M a r c h 17 M a r c h 19 M a r c h 31 A p r il 15 A p r il 16 M ay 5 ............ ............ ............ ............ ...... ............ ............ ............ ............ ............ ............ ............ ............ ............ Los Angeles San Francisco Sacramento (Cents per gallon) i s y2 14J4 (Cents per gallon) 16 15 13 13 13 11 15 (Cents per gallon) 17 16 14 14 14 12 16 12y2 10^ sy2 8y 14 y 2 M onthly average prices of non-ferrous metals, with the exception of silver, declined during April, 1927, continuing an earlier m ove ment which was interrupted only temporarily by the slight price advances reported during March. A national lumber index published by “ The Lumber Manufacturer and Dealer” re mained unchanged in April, 1927, at 30.52 where it stood in March. A year ago this index was 31.52. Banking and Credit Throughout the early months of 1927, con dition statements of reporting member banks in nine principal cities of the Twelfth Federal Reserve District have shown relatively mild seasonal changes. A n abundant supply of credit and sound condition of these banks have enabled them to meet all customers’ demands for credit accommodation, to add to their in M EM BER BANK CR ED IT—T W E L F T H DISTR ICT Figures for about 65 member banks in leading cities, as of last Wednesday of each month. Latest figures, May 18. classes of earning assets— member bank dis counts, holdings of bills bought in the open market, and of United States government secu rities — declined over the month and year periods. Federal reserve note circulation in creased slightly during the month. Deposits were lower at the close of the period than at its beginning, however, and reserves were con siderably higher, so that the reserve ratio of the Federal Reserve Bank of San Francisco rose to 78.2 on May 18th, the highest point reached in over a year. F ED ER AL RESERVE BANK OF SAN F R A N C ISC O (In millions of dollars, percentage changes in parentheses) Condition May 18, 1927 T o t a l B ills a n d S e c u r itie s . . B ills D is c o u n t e d ................. U n ite d S tates S e c u r itie s . . . B ills B o u g h t ........................... 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 C ir c u la tio n ........................... . . t------- Changes from----------■, One Month One Y ear Ago Ago 91 42 31 18 282 180 (+ = — 26 — 13 — 8 — 5 + 28 — 5 increase. — — decrease. ) — 23 (2 0 .1 ) ( 2 2 .4 ) (2 3 .7 ) — 2 ( 5 .2 ) (2 1 .1 ) — 19 (3 8 .1 ) (2 1 .8 ) — 1 ( 6 .1 ) (1 1 .0 ) + 27 (1 0 .6 ) ( 2 .6 ) + 11 ( 6 .6 ) 182 + 10 ( 5 .7 ) — 4 ( 2 .3 )
@FedFRASER