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March 18, 1927



Business Situation

Mr. Thomas

In February recovery from the l a t e 1926 recession which began
in January became more evident* Preliminary figures indicate an increase
of one point in the manufactures index, two points in the minerals index,
and one point in the combined Index. These increases, furthermore, seem
to have been fairly general, the only decreases noted in the products
shown on the attached table being in s i l k , lumber, anthracite, copper and
zinc. The iron and steel industry show[ed] notable increase and trade
reports, for March indicate- a continuation of production a t a high rate.
The price decline In Iron and steel seems to have been definitely checked
but the volume of buying although fairly well maintained seems to be
largely for immediate delivery and contracts for the future are small
despite the fact that the second quarter begins within a couple of weeks.
Bituminous coal production continues in enormous volume and, despite the
large stocks accumulated, with the approach of April 1 at which time the

is almost certain to take place, prices seem to have strengthened

somewhat* The anthracite market on the other hand is dull and price
reductions effective March 15 and April 1 have been announced*


automobile production figures for the United States in February show an
output of 298,359 passenger cars and trucks as compared with the estimate
given l a s t week of 300,000«(fhla figure i s to be released Monday).
Detroit employment continues to show increases of about 1000 a week but is
s t i l l 'something over 40,000 less than l a s t year* Employment for the week
ending March 16 totals 227,613, therefore the decrease from a year ago Is

2* .
about 16 per cent.
Figures for freight car loadings for the week ending March 5
were substantially larger than in the corresponding week of l a s t year
and a l l the increase was not due to coal. This increase is particularly

because it was in that week of last year that the big advance

in car loadings began owing partly to the end of


Building contracts for the f i r s t 11 days in March were



in practically

the same volume as in the corresponding period of last year. They seem
to be showing the usual seasonal


The large contracting last

Spring, however, was in the l a s t half of March and the f i r s t half, of
The index of non-agricultural prices in February fell below the
previous pre-war low point. Agricultural products advanced in price
owing again largely to increases in livestock and their products. Clothing materials also show[ed] general increases but fuels, metals, and building
materials declined by substantial amounts. Our weekly index for March
11 reached practically the low point of 1924, and during the past week
cotton and wheat seem to have declined further. The price drop has
apparently not yet been checked.
Employment and payrolls



in February

offsetting the unusually large decrease in January. The indexes, however,
remain lower than a year ago.