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FEDERAL RESERVE BOARD STATEMENT FOR THE PRESS X-3821 For Relea.se in I4orning Papers , Monday, .Augu.s t 27, 1923. The following is a. sumnary of general business and financial conditions throughout the several Federal Reserve Districts, ba.sed upon sta.tistics for the months of July and August, a.s conta.ined in the forthcoming issue of the Federal Reserve Bulletin. Production of ba.sic comrr.odities and employment a.t industrial •e s tahlisb:r,p,en ts deer ea. sed in July and there wa.s a. further decline in wholesale prices. The distribution of goods, a.s indica.ted by ra.ilroa.d freight shipments, ma.inta.ined record tota.ls and the sales of merchandise, though showing the usua.l sea.sonal decline,· continued to be rela.tively heavy. PRODUCTION: Production in ba.sic industries, a.ccording to the inde.x. of the Federa.l Reserve Board, declined one per cent in July. Mill con- sumption of cotton, steel ingot production, and sugar meltings were considerably smaller than in June. New building opera.tions during the month, a.s mea.sured by the value of permits gra.nted and of contra.cts a.wa.rded 1 showed more than the usual sea.sonal decline. 1:. Employment at industrial esta}?lishments located in various sections of the country decrea.sed 2 per cent during July. Manufa.cturers of automobile tires, and cotton goods showed large reductions in number - of e~loyees. There were some further announcements of wa.ge advances, but thelie were not a.s n'l.lm3rous a.s in the three previous months- Avera.ge weekly earnings of factory workers, due to a. deorea.se in full-time .. -, -2-._ operations, were 3 per X-3821 cent less than in June. Crop foreca.s.ts of the Department of Agricul tut"e on the basis of cond'i'tion on August l indica.ted ,tha.t yields of wheat and !'Ye would be below J11ly estima.tes, while larger yields of cotton, corn, oa.ts and barley were foreca.st. Due to a. seasonal increa.se in grain shipments and continued large shipments of ir.dustl·ial raw ma.teria.ls and ma.nufa.ctut"ed goods • ca.:r loadings in the la.st week of July rea.ched the largest tota~ recm~d. TRADE: The volume of V'bolesale trade wa.s a.bout the same· in July as in June, \\hile there wa.s a. decline in retail trade, which wa.s largely sea.sonal in na.ture. AmOl'lg the wholeaale lines sa.les of dry goods a.nd clothing were larger than in June, while sales of groceries, ha.rdwa.re, and shoes were considerably SII'a.ller. l3usiness in all reporting lines wa.s larger tha.n :i.n July, 1922, and the a.vera.ge increase, a.s indica.ted by the Federa.l Reserve Board' s index of who l.esale tra.de, wa.s 13 per cent • . Sales of department stores were 10 per cent larger than a. yea.r a.go, while mail order sa.les showed a. ga.in of 27 per cent. Stocks of de- pa.rtment stores showed a. sea.sona.l reduction during July a.nd were smaller than in a:ny month since Ja.nua.ry. fR!CES: Wholesale commodity prices declined during July for the third consecutive month and the index of the Burea.u of La.bor Statistics wa.s 5 per cent below the April peak. Prices of a.ll groups of com- modi ties, except housefurnishings, were lower in July. The la.rgest decline occurred in quota.tions of clothing, drugs and chemica.ls, farm prodl.lCts, a.nd building ma.teria.ls. During the first half of August price changes were more moderate and quota.tions of cotton,spr'-n~ \11/hEJa.~t' h6'g~/ Sheep,· _,. -3- X-3821 a.nd rubber a.dvanced. BANK CREDIT: Since the middle of July the volume of bank credit in use ha.s shown a. reduction, largely because of the substantial liquide.tion of loans on stocks and bonds a.t New York City banks. Between July lSth and August 15th loans of member oonks in lea.ding cities t'~cured by !>tocks and bonds decrea.sed by $94,000,000 to ~he' lowest point for the yea.r, $258 ,000,000 below the a.rr..ount .outstanding a.t the beginning of the year. Commercial loans, hovreve;r, increa.sed, so tha. t the net reduction in total loa.ns for the period aroounted to $6o,ooo,ooo. ~curity investrrents·de- clined $73,000.000 to a new low level for the year. The volume of disco"Unted pa.per held a. t the Federa.l Reserve .Banks showed a. slight decrease, While their holdings of a.cceptance and United Sta.tes securities rea.ched new low points for the year. Between the middle of July and the middle of Augu.s t gold holdings of the Federa.l Reserve Banks increa.sed by $21.100 1 000, reflecting in part net gold imports during July of $27,400,000. Federa.l Reserve note circula.tion increased by a.bout $15,000,000, a.nd there were also substantia~ increa.ses in the volume of gold certifica.tes and Na.tiona.l bank notes in circulation. Slightly firmer tendencies in money rates during the month were reflected 'in a. gradually increa.sing proportion of comnercia.l paper sales a.t 5 1/4 per cent, a.s compared with 5 per cent in the previous month • ..
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