View PDF

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

B u sin ess C onditions
R eserv e
niSTRICT

S ev en th
FEDERAL
Volume 10, No. 6

June 1, 1027

M O N T H L Y R E V IE W P U B L IS H E D BY T H E
F E D E R A L R E S E R V E B A N K OF C H IC A G O

BUSINESS CONDITIONS IN THE UNITED STATES

NDUSTRIAL output declined in April, reflecting re­
duced activity both in mines and in factories. Distribu­
tion of commodities by railroads and retail trade increased,
and the 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 the
production of bituminous coal. Among manufacturing
industries, which as a whole were somewhat less active in
April than during the previous month when allowance is
made for usual season changes, reductions were reported
in the iron and steel and textile industries, as well as in
meat packing and in the production of building materials.
The manufacture of motor cars, though it showed the usual
seasonal increase in April, continued at a lower level than
a year ago. Petroleum production continued in record
volume, notwithstanding large stocks and declining prices.
The value of building contracts awarded declined slightly
in April from the record high figure in March, but was
larger than last year. The decline in building between
March and April reflected reduced activity in the construc­
tion of commercial, industrial, and educational buildings,
while contracts for residential and public buildings in­
creased.
On the basis of conditions on May 1, the Department
of Agriculture forecasts a winter wheat crop of 594,000,000
bushels, or about 5 per cent less than in 1926. Continued

I

P R O D U C T IO N

OF

MANUFACTURES

AND

M IN E R A L S

In d ex n u m b ers of p ro d u c tio n of m a n u fa c tu re s a n d m in e ra ls,
a d ju s te d fo r se a so n a l v a ria tio n s (1923-1925 a v e ra g e = 100). L a t ­
e st figures, A pril, 1927: M a n u fa c tu re s, 109; M in erals, 107.



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,
owing in part to the lateness of the Easter holiday. De­
partment 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. Wholesale
trade showed about the usual decrease between March and
April, and continued smaller than in the corresponding
month of last year. Inventories of merchandise carried
by department stores were in about the same volume at
the end of April as in March, while stocks of wholesale
firms were smaller.
Railroad carloadings were larger in April than is usual
at that season of the year, reflecting chiefly large shipments
of iron ore, coke, grain and grain products, but also in­
creased movement of miscellaneous freight and of mer­
chandise in less-than-carload lots. Coal shipments were 27
per cent smaller in April than in the preceding month.
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 price conditions were firmer. The
decline in April reflected chiefly a decrease in the price
of petroleum, lumber, and several of the nonferrous metals.

Compiled May 26, 1927

DEPARTMENT

STORE

SALES

There was little change in the level of agricultural prices,
which have been fairly constant since the beginning of the
year. During the first three weeks of May, prices of grains,
cotton, iron and steel, petroleum, lumber, and hides ad­
vanced, while those of live stock, coke, and nonferrous
metals declined.
BANK CREDIT.—Volume of credit of weekly report­
ing member banks, as measured by their total loans and
investments, increased by more than $300,000,000 during
the month ending May 18, and was on that date at the
highest level on record. This growth represented for the
most part an increase in the banks’ holdings of invest­
ments and in the volume of their loans on stocks and
bonds, while commercial loans showed relatively little
change.
W HOLESALE

P R IC E S

In d e x es of U. S. B u re a u of L ab o r S ta tis tic s (1913 = 100).
L a te s t figures, A pril, 1927: A ll C om m odities, 144.2; A g ric u ltu ra l
C om m odities, 143.3; N o n -a g ric u ltu ra l C om m odities, 144.4.

MEMBER

BANK

C R E D IT

M o n th ly a v e ra g e s of w eek ly fig u res for b a n k s in 101 lea d in g
cities. L a te s t figures, a v e ra g e s fo r first th re e w eek ly re p o rtin g
d a te s in M ay, 1927: L o an s on S e c u rities, 5,782 m illion; A ll O th e r
L o an s, 8,682 m illion; In v e stm e n ts, 5,974 m illion.

BUSINESS CONDITIONS IN THE SEVENTH RESERVE DISTRICT

Seasonal developments in the main are reflected by cur­
rent reports to this bank. In agriculture may be noted
planting operations as averaging for the district slightly
in advance of last spring despite certain retarded sections;
the corn acreage nearly equal to that of 1926, but a reduc­
tion in the area planted to oats; lower estimates for the
district winter wheat and rye crops; and less favorable
fruit prospects this year than last. Grain receipts during
April dropped to unusually low levels; flour production de­
clined seasonally; trading in futures slowed down. April
receipts at stock yards, and output by meat packing com­
panies, likewise showed recessions. Dairy products, how­
ever, increased in volume of production and distribution.
Industrial employment continued to register declines,
reaching a level about five per cent below a year ago. The
curtailment customary in April at steel mills was slight,
while average daily pig iron output increased both over
March and last year. Automobile production advanced in
the month-to-month comparison. Operations at casting
foundries, shoe and furniture factories, and at tanneries,
on the other hand, were reduced. W et weather tended to
delay building and allied activities; contract awards fell
below the March total, although heavier than in April,
1926; the number of permits continued under last year
but gained over the preceding month. Retail lumber yards
sold more than in March or a year ago, and cement pro­
duction and shipments increased in both comparisons;
brick shipments improved.
April statistics on distribution at wholesale indicate con


At the reserve banks there was a decrease during the
month in total volume of credit outstanding, owing to the
receipt of a considerable amount of gold from abroad, in
addition to the purchase abroad by these banks of about
$60,000,000 of gold that is 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 comparatively
stable during the first three weeks of May, and there were
no changes in rates quoted on prime commercial paper
and on acceptances.

traction in sales of lumber, automobiles, groceries, hard­
ware, dry goods, drugs, and shoes. Retail trade, however,
expanded, with gains by department stores, furniture and
shoe dealers, and mail order houses; all showed increases
over a year ago.
In the financial situation easy money continues the chief
factor, with large funds available as reflected in the bond
market. Decreases occurred in commercial paper sales
and check payments; savings deposits increased.
CREDIT CONDITIONS AND MONEY RATES
A moderate expansion in industrial activity during recent
weeks has found reflection in heavier commercial loans
in many centers, but the volume of available funds has so
far exceeded actual requirements that rates have held their
own with difficulty. In Chicago, marked ease has pre­
vailed, although commercial loans have increased consid­
erably since May 1. Current quotations are as follows:
Commercial paper 4-4J4, customers’ over-the-counter loans
4^-4$4, and collateral loans
A lowering ten­
dency in rate levels is indicated by the fact that the
average rate earned on loans and discounts by ten of
the larger loop institutions in April was 4.86 per cent as
against 4.95 per cent the preceding month. In Detroit,
where conditions are reported as essentially unchanged
from a month ago, the average rate earned by six banks
amounted to 5.47 per cent in April, and 5.41 per cent in
March. The prevailing rate on loans and discounts in the
latter city for the week ended May 15 was \y2—6 per cent.

The volume of reserve bank credit in use in the Seventh
district has been in decreasing volume, subject to weekto-week fluctuation, since the first of the year, the $114,471,000 shown on May 18 for total bills and securities
marking the low point thus far in 1927 and since August
12, 1925, when $107,071,000 was given. Loans to member
banks have followed a similar trend, but the low point
of 1927 was registered on April 13, with $38,579,000; on
May 18 the item aggregated $44,890,000. Since mid-April,
Federal Reserve notes in circulation have shown moderate
weekly declines, $222,362,000 on May 18 comparing with
$229,357,000 April 13.
Loans and discounts of reporting member banks on May
11 reached the high point of the year, with $2,180,679,000,
gains in Chicago and Detroit being largely responsible for
the heavier volume shown in the district total on the first
two reporting dates in May. On May 18 a drop of about
5 million brought the figure to $2,175,373,000. Invest­
ments were in decreasing volume until May 18 when
a rise of 11 million from the $778,329,000 on May 11 took
place. Net demand deposits were reported as $1,828,619,000
on May 18, the highest point since the $1,841,457,000 on
October 13, 1926. Time deposits have moved steadily up­
ward since the middle of April; on May 18 this item aggre­
gated $1,087,691,000, the largest total shown since compi­
lation of these figures was begun in 1919.
April sales of eleven commercial paper houses report­
ing regularly to this bank aggregated less than for any
month this year, and with the exception of September
were below each month in 1926. All but one firm indi­
cated declines from April last year, the net reduction for
the group amounting to 23.0 per cent; this compares with
3.7 per cent, the average decrease in sales during the first
quarter of 1927 from the corresponding period of 1926.
In comparison with the preceding month, nine declines and
two increases averaged a drop of 13.5 per cent. The
amount of paper outstanding on April 30 for five dealers
was 2.4 per cent below the March 31 figure, and 4.8 per
cent under a year ago; both declines represent individually
four decreases and one gain. Total paper outstanding
for twenty-six dealers throughout the country on April 30
amounted to $602,000,000, or $5,000,000 less than on March
31. Rates were steady, high ruling at 4J4, low at 4, and
customary at 4 to 4*4; some dealers noted a slightly
firmer tendency.
Average weekly purchases of six reporting dealers in
the Chicago open bill market from April 14 to May 18
exceeded by 34.4 per cent the volume bought during the
preceding four weeks. Sales in the same comparison ad­
vanced 2.5 per cent, which reflects gains in the amount
sold to the Federal Reserve bank and to others, and
declines to local and out-of-town banks. Paper was drawn
chiefly for rubber, cotton, packing-house products, sugar,
grain, canned goods, lumber, tobacco, silk, poultry and
eggs. Inter-office statistics indicated a decrease in the
volume received from other cities but a gain in the amount
forwarded from Chicago. Holdings dropped on April 20
to the low point for 1927, but on May 18 were 22.0 per
cent above the close of the preceding period, and the
highest since March 9; ninety-day maturities constituted
the bulk of bills held, with sixty- and thirty-day following
in the order named. Steady rates were maintained, all
paper selling the same on May 18 as on April 13, with
thirty-day bills offered at 3J4, sixty- and ninety-day at
3§4, and four-month paper ruling at 334.
Reporting banks accepted during April a dollar volume
of bills within 0.9 per cent of the March amount, individu­
ally six banks registering increases and six declines, with



four indicating no transactions; the drop of 28.4 per cent
from April, 1926, reflects two gains and ten decreases.
Statistics covering the first two weeks of May include
bills principally for provisions, copper, iron, rubber, coffee,
lumber, tobacco, cotton, grain, and feathers. Purchases
during April fell off 35.3 per cent from the preceding
month, but were 65.8 per cent above a year ago; sales
declined 48.1 and 22.7 per cent in the two comparisons.
In the amount of liability as acceptors for acceptances out­
standing, the group, with three exceptions, reported re­
ductions from 1926, the aggregate on April 30 for the first
time in eight months dropping below the corresponding
date of the previous year (20.2 per cent); the decline of
4.9 per cent from March 31 represents gains for five banks
and decreases for eight. Total holdings advanced 63.3
per cent between March 31 and April 30 to 33.1 per cent
in excess of the volume held a year ago. Holdings by the
Federal Reserve Bank of Chicago at the end of April
totaled $32,682,843, or 40.1 per cent heavier than last year;
April purchases of $28,625,199 compared with the March
figure, $27,363,699.
Agricultural Financing—Nineteen Joint Stock Land
banks with loans outstanding on April 30 in the five states
including the Seventh district of $221,052,015 showed a
decrease of $723,351 in the item from March 31. Loans
of four Federal Land banks in the same territory April 30
totaled $196,111,952, as against $193,436,464 March 31.
Four Federal Intermediate Credit banks had loans and
discounts (including rediscounts) on April 30 of $849,519
compared with $863,195 at the close of the preceding
month.
Volume of Payment by Check—Thirty-seven clearing
house cities of the Seventh district in April showed a
decrease from March of 1.2 per cent in aggregate payment
by check, and a gain of 3.7 per cent as against April, 1926.
The four larger cities, Chicago, Detroit, Milwaukee, and
Indianapolis, showed an aggregate drop of 0.7 per cent in
the monthly and a rise of 4.3 per cent in the yearly com­
parison, while in thirty-three smaller centers, the respective
changes in these comparisons were a decline of 3.8 per
cent, and a gain of 0.7 per cent.
C he cks

V O L U M E OF P A Y M E N T BY C H E C K
D r a w n on C le a r i n g H o u s e B a n k s , 7t h

D istrict

d ian ap o lis, 5,165,237; 31 O th e r C lea rin g H o u se C e n te rs, 948,203.

Savings—Both the total number of savings accounts
and the aggregate amount of deposits for 212 reporting
banks in this district were 0.1 per cent higher on May 1
than at the beginning of April; individually, half the banks
registered increases in number, and 113 in amount of de­
posits, while by states all except Illinois averaged gains in
the two items. The advance in number of accounts raised
the totals for Indiana, Iowa, Michigan, and Wisconsin, as
Page 3

well as for the district, to record levels; in deposits In­
diana and Michigan alone reached new peaks. The net
increases over May 1, 1926, of 3.5 per cent in number of
accounts and 1.0 per cent in deposits reflect gains at 146 and
132 banks, respectively.
Bonds—The bond market continues active in response
to the large volume of funds seeking investment. Prac­

tically all classes of bonds are in demand, and new flota­
tions are readily absorbed. Many of the latter, recently
offered, have been for refunding purposes. High grade
utilities retain favor. Railroad bonds have continued pop­
ular and advanced in price. Municipals likewise have
strengthened further. Dealers’ shelves are relatively bare;
inventories of real estate bonds are reported unusually low.

AGRICULTURAL PRODUCTION AND FOODSTUFFS

According to data compiled from reports sent direct to
this bank by 139 county agents representing 232,569 farm­
ers, spring planting operations by early May showed bet­
ter than normal advancement in lower Michigan, but were
lagging from one to two weeks behind usual schedule in
Iowa, northern Illinois, northern Indiana, and southern
Wisconsin. The acreage being planted to corn is nearly
equal to that of a year ago, while the area devoted to oats
has been reduced 5 to 10 per cent. Prospects for fruit
were not so favorable as last year; varying degrees of
frost damage to early blooms were reported in the south­
ern part of the district and in a number of Michigan coun­
ties largely outside the so-called “fruit belt” bordering
Lake Michigan. Apples that bloomed before the frost
were in poor condition, while later varieties ranged from
fair to good. Indications pointed to a smaller crop of
peaches and to the possibility of a reduction in size of
the cherry crop and the total production of apples. The
reports showed an increase of 2.3 per cent in the Seventh
district crop of young pigs over last spring, and a reduc­
tion of 3.4 per cent in the number of marketable hogs
remaining on farms as compared with a year ago. The
Bureau of Agricultural Economics, on the basis of May
1 condition, forecasts the 19'27 crop of winter wheat at
93,151,000 bushels and of rye at 10,228,000 bushels for
the five states including the Seventh district, as compared
with respective harvests of 99,439,000 and 10,415,000 bush­
els in 1926. A production of 593,940,000 bushels of winter
wheat and of 47,861,000 bushels of rye is estimated for the
United States as a whole, against 626,929,000 and 40,024,000
bushels, respectively, the final estimates for 1926, and com­
pared with the 1917-26 average of 572,887,000 bushels of
winter wheat and 67,001,000 bushels of rye.
Grain Marketing—Wheat, corn, and oats receipts at
interior primary markets in the United States receded to
unusually low levels in April, with the quantity of each
grain less than in the preceding month or the 1922-26
average for the period and with wheat arrivals showing
the only gain over a year ago. Reshipments of wheat and
corn from these centers were greater than in March or
the corresponding period last year and those of oats were
smaller; the two last-mentioned items fell below the fiveyear average for April. United States visible supplies of
grain were lower on May 14 than on the corresponding
Saturday in April; wheat and corn holdings exceeded a
year ago, but the stock of oats, rye, and barley declined.
April trading in future delivery grain by members of the
Chicago Board of Trade showed a recession in volume of
13.8 per cent from the preceding month and was 30.7
per cent under a year ago; contracts for oats and rye,
however, were in excess of March and those for corn and
rye increased slightly over April, 1926. Chicago quota­
tions for cash wheat and oats averaged about steady with
March, while those for corn and rye firmed a little; prices
eased for May, July, and September wheat and corn deliv­
eries. Quotations for most grain tended to advance early
in May.
Flour—Production of flour by mills in the Seventh dis­
Page 4




trict declined seasonally in April, but for the second suc­
cessive month exceeded that of the corresponding month a
year ago. As is usual in April, receipts of flour at Chicago
were smaller; shipments, on the other hand, increased
somewhat. Both receipts and shipments were heavier
than in April, 1926.
CHANGES IN APRIL, 1927, FROM PREVIOUS MONTHS
P er cent change from
M arch
C ompanies
A pril
1927
1926
included

Production (bbls.) ......................... — 10.6
Stocks of flour at end of month
(bbls.) ........................................... — 17.8
Stocks of wheat at end of month
(bu.) ............................................... —28.8
—25.5
Sales (volume) .........................
Sales (value) .................................... —21.9
other flours.
to wheat flour only.

+ 3.3
33
— 2.4
29
+ 16.4
29
15
+ 3.1
15
— 12.7
Balance of items refer

Movement of Live Stock—April receipts at public stock
yards in the United States showed a recession in volume
from the preceding month and a year ago. Light to
medium weight steers, marketed from feed lots, comprised
the larger portion of cattle arrivals during the period;
the receipts of cows, heifers, and choice heavy steers re­
mained moderate. Smaller numbers of fed lambs were
received than in March, but they constituted the bulk of
ovine offerings; the supply of sheep continued rather
limited and the movement of spring lambs expanded
slightly. Hog receipts were reduced because of farm
work and bad roads.
LIVE STOCK SLAUGHTER

C attle

Yards in Seventh District,
April, 1927 ..................... 208,395
Federally Inspected Slaughter U. S.
April, 1927 ....... ............... 741,951
March, 1927 .................. 761,299
April, 1926 ....... ............... 765,540

L ambs and
S heep

C alves

677,828

219,335

147,698

3,329,557'
3,837,278
3,104,656

959,673
1,026,736
994,287

453,956
456,599
461,482

H ogs

Reshipments to feed lots increased slightly for cattle
and declined for lambs during April as compared with
March; both showed a recession in volume from the cor­
responding month of 1926.
AVERAGE PRICES OF LIVE STOCK

(Per hundred pounds at Chicago)
W eek ended
M ay 14
A pril

Native Beef Steers (average)
Fat Cows and Heifers............
Hogs (bulk of sales) .................
Yearling Sheep ..........................
Lambs (average) ..........................

1927
$11.10
8.00
9.70
12.25
15.60

1927
$10.95
7.85
10.75
13.25
15.65

M onths of
M arch

1927
$10.65
7.45
11.40
12.35
15.10

A pril

1926
$ 9.40
6.95
12.25
10.50
13.65

Indices of the International Liv< Stock Exhibition show
the volume of inspected slaughter in the United States as
102, the price of all live stock as 114, and the total value
of the slaughter as 116 for April, compared with similar
indices of 106, of 115, and 122 for March.
Meat Packing—Production at slaughtering establish­
ments in the United States was seasonally lower for April
than for the preceding month, while employment for the
last payroll of the period showed a decline of 2.7 per
cent in number, 3.2 per cent in hours worked, and 3.5 per
cent in total value from corresponding figures for March.
Domestic demand averaged fair. Sales billed to domestic
and foreign customers by fifty-three meat packing com­
panies in the United States totaled 1.0 per cent greater

than in March and were 5.5 per cent below a year ago.
Chicago quotations for pork, lard, and veal showed some
recession in April from March, those for smoked meat held
fairly steady, while prices of beef, lamb, and mutton
firmed. May 1 inventories at packing plants and coldstorage warehouses in the United States exceeded those
of April 1 despite a reduction in beef, lamb, mutton, and
miscellaneous meat holdings. Stocks of cured beef, dry
salt pork, lamb, and mutton declined from the correspond­
ing date last year, while the volume of other edible
products increased. All the items, with the exception of
frozen and pickled pork, fell below the 1922-26 May 1
average. A slightly larger tonnage of lard was forwarddd
in April for export than in the preceding month, but the
volume of meats showed little change. European custom­
ers purchased a fair tonnage of lard and oleo oil, and the
English demand for hams improved somewhat, while for­
eign trade in other packing-house products remained rather
narrow. Consigned stocks abroad were indicated slightly
heavier than at the beginning of April. Prices remained
a little under Chicago parity.
Dairy Products—Reports from sixty-nine creameries in
the Seventh district show that butter production aggregated

10.1 per cent greater for April than for the preceding
month and was 10.4 per cent in excess of a year ago.
Statistics released by the American Association of Cream­
ery Butter Manufacturers indicate a similar trend for the
United States. April sales of creamery butter billed to
customers by seventy-one firms in the district totaled
2.9 per cent heavier than in March and 9.9 per cent above
the corresponding month last year. Receipts of American
cheese at Wisconsin primary markets from factories within
that state increased 18.4 per cent during the four weeks
ended April 30 over the preceding period, and showed a
recession of 6.5 per cent from a year ago; redistribution
gained 17.1 per cent and declined 6.3 per cent, respectively,
in the two comparisons. Cold-storage warehouses and
packing plants in the United States held larger inventories
of eggs and smaller quantities of cheese on May 1 than
at the beginning of the preceding month or a year ago; the
volume of each gained over the 1922-26 May average.
Butter stocks increased over April 1 but showed a reces­
sion of 80 per cent from May 1, 1926, and of 54 per cent
from the five-year average. Receipts of dairy products
at Chicago were heavier in April than in the preceding
month. Chicago quotations for dairy products averaged
slightly lower than those of March.

INDUSTRIAL EMPLOYMENT CONDITIONS

A decline of 0.9 per cent in the volume of employment
at manufacturing plants of the Seventh Federal Reserve
district was reported for the period March 15 to April 15.
This follows an early spring recession of 0.5 per cent
registered for the preceding month, and brings employ­
ment to a level about 5 per cent lower than in April, 1926.
At least part of the downward trend in employment for
April, however, can be ascribed to the lateness of the sea­
son, cold weather and rains retarding an active demand
for many products.
Losses exceeding the average were registered by the
metals, textiles, lumber, and leather groups, while definite
gains were shown in the manufacture of automobiles, rub­
ber products, and most of the building materials. Under
the “metals” group, the loss shown was almost entirely
the result of the heavy reductions in the manufacture of
machinery and electrical apparatus; under “textiles,” it
was due to the continued curtailment in the clothing in­
dustry. The decrease in employment at furniture factor­
ies again accounted for the loss registered by the lumber
products group, while leather industries generally made

further reductions in their working forces. Declines in
meat packing and confectionery more than offset increases
in other food industries, as in canning and preserving, the
manufacture of ice and ice-cream, and in dairy products.
A slight gain was made by the chemical products group,
and rubber products showed a marked increase in employ­
ment. Greater activity in construction work was reflected
in the stone, cement, brick, and glass industries, as well
as in the manufacture of sash, door, and interior finish.
At Detroit employment continued to gain slightly, the
reports from the Employers’ Association indicating a 0.3
per cent increase from the second week in April to the
corresponding week of May. Workers applying for posi­
tions at the free employment offices of the state of Illinois
were in declining ratio to the number of positions avail­
able, falling from 174 per cent at the end of March to
154 at the close of April; the employment offices of Iowa
showed a similar decline, from 352 per cent to 269; while
in Indiana the ratio remained about the same, 122 as
compared with 120 the preceding month.

EMPLOYMENT AND EARNINGS—SEVENTH FEDERAL RESERVE DISTRICT

I ndustrial G roups

Paper and printing................................................................................ -----......

N umber of W age E arners
W eek ended
M arch 15
P er C ent
A pril 15
1927
C hange
1927
— 0.9
368,183
364,873
— 1.2
152,126
150,366
+ 2 .6
34,055
34,950
— 3.4
28,025
. 27,070
— 0.8
49,173
48,762
+ 2 .0
14,039
14,321
— 1.8
31,538
30,976
+ 0 .4
10,654
10,701
— 6.2
16,231
15,231
+ 4 .7
3,328
3,484
— 0.0
29,014
29,012

P er C ent
C hange
— 0.5
+ 0.6
+ 4.3
— 12.7
— 0.3
+ 3.6
— 0.8
+ 0.2
— 12.6
+ 13.1
+ 0.3

MANUFACTURING ACTIVITIES AND OUTPUT

Automobile Production and Distribution—The fourth
monthly increase in United States production of passenger
automobiles took place in April, output totaling 353,071,
or a gain of 3.3 per cent over the preceding month. In
the comparison with a year ago, however, a lower rate
of output continues, the decline averaging 8.0 per cent



T otal E arnings
W eek ended
M arch 15
A pril 15
1927
1927
$9,723,042
$9,768,747
3,861,557 « 3,838,228
1,096,631
1,051,158
624,977
715,560
1,330,504
1,326,869
417,924
432,955
759,902
765,827
297,760
298,287
347,287
303,691
84,364
95,374
920.135
922,799

for April. Truck production in the United States totaled
44,495 in April, a recession of 1.5 per cent from March
and 4.5 per cent below the corresponding month of 1926.
Retail distribution of new automobiles remains consid­
erably below the rate of a year ago, although continuing
to shoiw increases in the month-to-month comparison.
Page 5

After three successive months of gain, wholesale distribu­
tion fell off in April and was likewise under the correspond­
ing month of 1926. Used car sales were larger in both
the month-to-month and yearly comparisons, while stocks
of salable used cars have declined and are under the num­
ber held on April 30, 1926. New cars on hand at the
end of the month were also less than on March 31 or
the corresponding date a year ago. Sales made during
April on the deferred payment plan by thirty-one dealers
reporting the item, averaged 37.1 per cent of their total
retail sales, dropping from 43.1 in the preceding month
and comparing with 45.8 per cent in April last year.
MIDWEST DISTRIBUTION OF AUTOMOBILES

Changes in April, 1927, from previous months

P er cent CHANGE FROM C om panies INCLUDED
M arch
A pril
M arch
A pril

1927
.New cars
Wholesale—
Number sold ......... .... — 5.0
Value ........................ . . — 9.0
Retail—
Number sold ................ +12.7
Value ........................ ... +23.4
On hand April 30—
Number ......................... — 5.5
Value ........................ .... — 6.4
Used cars
Number sold ................ + 4.7
Salable on hand—
Number .................... .... — 10.8
Value ........................ ..... — 4.5

1926

— 6.7
—20.4
—24.0
— 16.2
—21.5
— 10.3
+ 7.6
— 13.5
— 5.8

1927

1926

38
38
86
86
56
56
87
56
56

35
35
83
83
54
54
84
53
53

Agricultural Machinery and Equipment—Agricultural
machinery and equipment sales billed to domestic and for­
eign customers by eighty-five manufacturers in the United
States showed recessions in April from March of 11.6
per cent for the tractor, thresher, combination harvester
group; 26.5 per cent for all other (exclusive of barn sup­
plies); and a gain of 5.5 per cent for barn equipment. The
light machinery sales declined 15.3 per cent from a year
ago, while those for the heavy group and for barn equip­
ment increased 31.3 and 5.1 per cent, respectively. Pro­
duction showed a somewhat irregular trend but averaged
a little ahead of March.
PRODUCTION AND SALES OF FARM EQUIPMENT IN THE
UNITED STATES

Changes in April, 1927, from previous months
P er cent change from
M arch
A pril

C om panies

1927
1926
INCLUDED
Domestic sales billed......... ..... — 17.0
+ 4.5
85
Sales billed for export ..... ..... — 30.8
44
— 2.8
Total sales billed ............. ..... — 19.3
85
+ 3.4
Production .......................... ..... + 6.5
— 1.4
83
Sales based on value. Production computed from average employment during the month.

Iron and Steel Products—Specifications and sales of fin­
ished steel during April, as reported by mills in the Chi­
cago district, compared favorably with the corresponding
month of 1926, although activity was slightly under the
March rate. In most districts of the country a moderate
recession took place during the month. The unfilled ton­
nage of the United States Steel Corporation on April 30
was th‘«e lowest since August 31, 1924, totaling qfnly
3,456,132 tons; this compared with 3,867,976 tons on the
same date a year ago. Steel ingot production, averaging,
158,844 tons daily for the United States, fell off from
the March rate but was heavy for April. Average daily
pig iron output for the country of 114,074 tons exceeded
that for the preceding month but was under April last
year; the average in the Illinois and Indiana district was
higher in both comparisons.
Prices have been firmer in recent weeks. The composite
price of fourteen leading iron and steel products, as com­
piled by Iron Trade Review, after touching a low for the
year on April 20 of $36.64, had risen to $36.85 by May
11, an advance mostly attributable to increases in sheet
Page 6




prices. On May 18 it had declined slightly to $36.82, be­
cause of pig iron which has been weak, as has also scrap
iron and steel.
Forty-five iron and steel casting foundries of the district
report the aggregate value of shipments made during
April as 7.0 per cent less than in the preceding month,
while the number of tons shipped declined 6.8 per cent.
The total amount of metal consumed showed a decrease of
10.8 per cent. Production and shipments continue below the
rate of a year ago, shipments declining 19.6 and 19.9 per
cent in tonnage and value, respectively, and metal con­
sumption being less by 20.2 per cent. Stove and furnace
manufacturers shipped a slightly larger amount during April
than in March or the corresponding month a year ago. O r­
ders accepted during the month declined in the month-tomonth comparison, but wrere somewhat greater than in
April, 1926. Production was reduced from the March rate
and exceeded that of April last year. Stocks were heavier
in both comparisons.
Shoe Manufacturing, Tanning, and Hides—Shipments
during April by thirty-two shoe factories in the Seventh
district exceeded their production by 6.2 per cent, while
both showed a seasonal recession from March and a gain
over a year ago. Stock shoes reported on hand by twentyeight of the companies were equivalent in volume to 79.1
per cent of their April shipments. Unfilled orders gave
assurance of practically five weeks’ business at the current
rate of distribution.
CHANGES IN THE SHOE MANUFACTURING INDUSTRY IN
APRIL, 1927, FROM PREVIOUS MONTHS
P er cent change from
M arch
C ompanies
A pril

Production ............................ ....
Shipments .............................. ....
Stock shoes on hand........... ....
Unfilled orders ...................... ....

1927
— 14.1
— 16.3
— 4.1
— 3.0

1926
+ 13.9

+ 8.0
—
+

3.4
3.2

INCLUDED
32
32
29
23

Leather production in the Seventh district declined in
April from the preceding month, according to reports
sent direct to this bank by representative tanners. In the
year-to-year comparison, the gains slightly more than offset
the recessions. Sales billed to customers totaled a little
below March and somewhat ahead of April, 1926. Demand
for belting and harness was indicated less active than in
the preceding month or a year ago. Quotations advanced
for cowhide leathers, while those for the remaining lines
showed slightly firmer tendencies.
A smaller number of packer green hides and calf skins
were sold at Chicago during April than in March; pur­
chases by tanners located in this district also declined.
Quotations at Chicago advanced in April over the prior
month.
Furniture—New business received by twenty-four furni­
ture manufacturers located in the Seventh district averaged
a decline of 15.6 per cent in April as compared with March.
Orders booked showed a decrease in the yearly comparison
for seventeen firms of 4.0 per cent in the aggregate, and
as compared with the corresponding month of 1925 they
were 4.9 per cent smaller. Shipments during April likewise
declined in all comparisons, falling off 13.3 per cent from
March, 1.6 per cent from April a year ago, and 4.3 per
cent from April, 1925. Shipments were heavier than new
orders, so that unfilled orders at the end of the month
were 17.8 per cent below the amount held on March 31;
as compared with April 30 last year, they were 0.5 per cent
larger. Operations continue to be reduced, averaging 77.6
per cent of capacity in April, against 81.3 per cent in thej
preceding month.
Raw Wool and Finished Woolens—Few developments
of importance have taken place in either the raw wool

or finished goods markets during the past two months, and
the situation in general has been quiet. Mills continue
to buy wool for current needs only, while prices have eased
one to two cents per pound since the middle of March.
Inasmuch as foreign markets have been stronger than
domestic, there has been some re-exporting of foreign
wools during the period. Both contracting on the new
domestic clip and actual shearing have slowed down in
recent weeks. The Jericho clip of approximately 1,000,000
pounds sold at 30% cents this year, as compared with
34% cents obtained last year. Conditions with manufac­
turers are uncertain and vary considerably; a fair amount
of advance business has been booked by a few firms, a
substantially large amount by others, but orders in gen­
eral have not been in sufficient quantities to assure a high
rate of operations over a long period.
Electric Energy—Production of electric energy declined
in April from the preceding month, according to reports
of eight central station companies in this district, but a
reduction is usual for this month and the decline of 4.5
per cent in daily output compares with one of 6.7 per
cent in the same comparison last year. The slight fall­
ing off in total sales to industrial users was due entirely
to the fewer number of working days in April, as the daily
average for the month showed an increase; in April,

1926, the working day average of industrial sales was less
than in the preceding month by 2.2 per cent.
CHANGES IN APRIL, 1927, FROM PREVIOUS MONTHS

(Compiled from direct reports to this bank by eight companies)

P ee cent change from
M arch
A pril

1927
1926
Plant capacity (KW ) .................................................... — 0.0
+12.3
Plant output (K W H ) .................................................... — 7.6
+ 8.4
Plant output (daily average— K W H )...................... -—4.5
+ 8.4
Peakload demand (K W )................................................. — 3.2
+ 7.5
+17.6
Industrial sales (K W H )................................................ —0.3
Industrial sales (working day average—K W H ).. + 3.5
+17.6
A pril
M arch A pril
1927
1927
1926
Ratio peakload demand to plant capacity............ 68.9
71.2
72.0
Load factor ................................................................. 57.3
58.1
56.8

Indices of industrial production as measured by electric
energy consumption, compiled by McGraw-Hill Publish­
ing Company, show gains over April a year ago in both
the north central states and the United States as a whole.
By industrial groups, chemicals, automobiles, and textiles
gained over the preceding month in the north central
states, while metals, paper, and lumber declined.
INDUSTRIAL PRODUCTION AS MEASURED BY ELECTRIC
ENERGY CONSUMPTION

(Monthly average 1923-1925 = 100)
A pril M arch
A pril M arch
1927
1927
1926
1926
North Central States........................... 121.0
121.9
118.9
122.6
United States ...................................... 126.1
121.1
114.1
123.0
Data furnished by McGraw-Hill Publishing Co., Inc.

BUILDING MATERIAL AND CONSTRUCTION ACTIVITIES

Dollar sales in April of twenty-five wholesale lumber
dealers declined 9.8 per cent from March and 2.3 per cent
from a year ago; sales in board feet showed decreases of
4.5 and 8.2 per cent in the same comparisons. The ratio of
accounts receivable at the end of April to sales during the
month was 143.8, as against 127.8 on March 31 and
147.4 a year ago. Automobile makers bought large quan­
tities of hardwoods on the hand-to-mouth plan; demand
was also active from furniture and box manufacturers and
sash and door factories. Although wet weather delayed
building activities, 236 retail yards showed total sales in­
creases of 12.0 and 6.9 per cent in the respective month-tomonth and yearly comparisons, with the ratio of out­
standings to sales 267.4 at the end of April, as against
280.4 on March 31 and 281.7 a year ago. Stocks of retail
dealers were somewhat larger than at the end of March
and about the same as on April 30, 1926; wholesale deal­
ers reported slight declines in both comparisons.
Brick shipments improved markedly over March and
compared favorably with April of last year; production

MERCHANDISING CONDITIONS

Wholesale Trade—Heavy rains which made roads im­
passable and delayed spring planting in many sections of
the district restricted sales which, according to dealers
in five reporting lines of wholesale trade, were smaller
in April than in March, and likewise below a year
ago for all except hardware and shoe firms. Collections
were larger than in the preceding month and, as compared
with April, 1926, increased for all except drugs and shoes;
outstanding accounts at the end of the month were larger
for groceries and hardware, and smaller for all other lines
in both comparisons.
Groceries—Sales of thirty-nine wholesale grocers de­
creased 0.4 and 0.04 per cent in the respective month-tomonth and yearly comparisons. Stocks advanced 6.9 per
cent over March 31 and were 8.6 per cent under the same
date a year ago; outstanding accounts increased 1.5 and
0.8 per cent, and collections during the month gained 1.8
and 3.8 per cent, respectively.



was curtailed by excessive rains. In the cement industry
both production and shipments increased over the preced­
ing month and April, 1926, although wet weather pre­
vented much contemplated road building and other con­
struction. Cement stocks, while somewhat below March,
were larger than a year ago.
Building Construction—Building contracts awarded in
the Seventh district during April, amounting to $112,069,635, represented an increase of 27.8 per cent over a year
ago and a decline of 7.7 per cent from March. Residential
contracts totaling $47,803,805, exceeded the figures of
March and last year by 13.7 and 46.2 per cent, respectively.
The aggregate number of permits issued by fifty cities in
the district was 8.5 per cent above the prior month and
10.6 per cent under April, 1926, while their estimated cost
decreased 4.0 and 4.7 per cent in the two comparisons. Of
the five larger cities only Des Moines and Detroit had an
increased number of projects over March, and all reported
declines from last year.
Hardware—Seventeen hardware dealers with total sales
5.0 per cent in excess of April, 1926, represented one of
the two wholesale lines reporting increases in that com­
parison; a decline of 4.0 per cent from March was indi­
cated. Stocks on April 30 declined somewhat from both
March 31 and a year ago; outstanding accounts increased
7.2 and 1.4 per cent, respectively, while collections were
larger by 12.7 and 9.3 per cent in the two comparisons.
Dry Goods—Respective sales declines of twelve report­
ing dry goods dealers as compared with March and a year
ago were 22.4 and 7.1 per cent; stocks increased 1.3 per
cent over March 31 and decreased 25.6 per cent from last
April; outstanding accounts on April 30 aggregated 1.4
and 4t7 per cent less, respectively; and collections ad­
vanced 4.7 and 0.2 per cent in the two comparisons.
Drugs—Twelve drug dealers reported total sales as 7.6
and 8.0 per cent smaller in the month-to-month and yearly
comparisons. Stocks at the end of April were 3.4 and 3.8
Page 7

per cent larger, respectively; accounts outstanding on April
seven retail furniture dealers and the furniture departments
.i0 declined 2.4 and 11.3 per cent, and collections showed
of twenty-two department stores, total sales for April in­
an increase of 6.3 per cent over March and a decline of 2.9
creased over March and a year ago by 13.7 and 5.1 per
per cent from April, 1926.
cent, respectively, while stocks changed but little in the
former and were slightly less in the latter comparison.
Shoes Sales reported by nine shoe dealers contracted
Installment sales, as reported by twenty furniture stores,
5.3 per cent from March and advanced 7.0 per cent over a
increased 22.4 and 8.2 per cent, respectively. Collections,
year ago. Stocks decreased 5.4 per cent in both compari­
on both installment and total sales, and accounts outstand­
sons; outstanding accounts fell off 0.3 and 5.2 per cent;
ing were larger than for either the preceding month or a
and collections, while increasing 16.1 per cent over the
year ago.
preceding month, showed a total decline of 8.7 per cent
Retail Shoe Trade—Total sales of forty-three retail shoe
from last year.
dealers for April averaged 25.8 per cent more than in
Department Store Trade—April sales of eighty-four re­
March, and 8.9 per cent over a year ago, with sales for
porting department stores showed an advance over March
the first four months of the year aggregating 3.0 per cent
of 8.5 per cent and in the yearly comparison a gain of 9.7
above the same period in 1926. Individually, all firms re­
per cent. Aggregate sales for the first four months of
ported increases over March and nearly three-fourths over
1927 were 3.4 per cent in excess of the same period in
April last year. Stocks gained 0.5 and 1.2 per cent in the
1926. Stocks at the end of April showed little change
two comparisons; outstanding accounts declined 14.7 and
from either the preceding month or the end of April last
26.3 per cent, respectively, while collections were larger
year; the ratio of total sales to average stocks was 32.6
by 2.2 and 2.0 per cent. The ratio of outstanding accounts
per cent as compared with 29.5 a year ago. Collections
to sales was 53.1 per cent in April as compared with 81.7
and accounts outstanding at the end of the month in­
for March and 76.3 a year ago.
creased over both March, 1927, and April, 1926, the former
Chain Stores—Five of nine chain store systems report­
by 0.1 and 11.9 and the latter by 3.2 and 9.6 per cent,
ing to this bank had larger sales in April than in the
respectively. Outstanding orders on April 30 represented
previous month and six showed gains over April of last
7.2 per cent of total 1926 purchases, as compared with 7.3
year, changes which are to some extent attributable to
per cent at the end of March. April collections averaged
increases in the number of stores in operation. Of four
42.2 per cent of accounts outstanding on March 31; the
reporting lines, grocery, drug, and shoe chains had in­
figure a year ago was 41.2.
creased sales over a year ago; and drug and musical
Retail Furniture Trade—According to reports of twentyinstrument dealers showed aggregate declines from March.
MONTHLY BUSINESS INDICES COMPUTED BY FEDERAL RESERVE BANK OF CHICAGO

(Index numbers express a comparison of unit or dollar volume for the month indicated, using the monthly average for 1923-1924-1925 as a base, unless
otherwise indicated. W here figures for latest month shown are partly estimated on basis of returns received to date, revisions will be given the following
isions
No. of April March April March
No. of April March April Marcl
Firms 1927 1927 1926 1926
Firms 1927 1927 1926 1926
Meat Packing— (U. S.)—
Wholesale T ra d e Sales (in dollars) ........................................ 62 102.9 102.4 108.3 108.4
N et Sales (in dollars) :
38 95.3 95.7 95.6 93.4
Groceries ......................
Casting Foundries—
19 97.7 101.7 97.0 98.1
Shipments (in dollars) ...................... ......... 27 88.6 93.9 107.7 116.0
. 13 68.1 93.2 79.0 92.8
Dry
Stoves and Furnaces—
11 94.2 104.5 107.6 114.1
Shipments (in dollars) ...................... .......... 13 89.3 85.7 82.6 81.4
9 90.0 95.0 80.7 112.8
Shoes ...........................................
Agricultural Machinery
Retail Trade (Dept. Stores)& Equipment— (U. S.)—
Net Sales (in dollars) :
Domestic Sales (in dollars)............ .......... 90 153.9 185.1 147.5 176.7
7 111.8 106.4 98.4 97.5
Exports (in dollars) .......................... .......... 60 137.3 199.8 140.3 175.0
5 138.1 126.9 116.2 123.7
Detroit
Total Sales (in dollars) .............................. 90 151.2 187.4 146.3 176.4
5 103.4 99.6 95.1 98.4
Production ............................................. .......... 88 144.6 136,0 146.4 141.4
6 114.3 95.5 107.6 96.9
Milwaukee
. 57 105.8 98.7 105.7 97.8
Furniture—
. 80 118.2 108.2 107.6 106.3
Seventh District ...............................
Orders (in dollars) ........................... .......... 19 76.2 101.5 79.4 108.4
Retail Trade— (U. S.)—3
Shipments (in dollars) ..................... .......... 19 110.2 115.7 112.1 117.3
128 133 130
359
Departm ent Stores .......- ..................
Shoes—1
132 120 130
4
Mail Order Houses ............................
Production (in pairs) ....................... .......... 34 100.1 117.8 87.0 102.2
Chain Stores:
Shipments (in pairs) ......................... .......... 34 105.5 127.9 96.3 110.9
386 329 302
27
Grocery ........................... ..................
Electric Energy—
224 191 194
9
D rug ....................................................
O utput of Plants (K W H ) .............. .......... 8 128.0 138.5 118.0 130.6
125 166 143
6
Shoe ....................................................
Industrial Sales (K W H ) ........................... 8 145.3 145.7 123.5 131.1
5
213 202 199
Five and Ten Cent.........................
216 226 206
Candy .......................................................... 5
Flour—
108 111 112
4
Music .....................................................
Production (in bbls.) ....................... .......... 34 88.3 98.8 85.9 92.3
153 150 142
Cigar ....................................................
3
O utput of Butter by Creameries—
Stamp Tax Collections—4
Production ........................................................ 76 114.8 101.3 107.1 96.9
77.2 118.2 91.2 141.3
Sales or Transfers of Capital Stock
Sales ........................................................ .......... 76 104.1 98.6 97.2 97.5
67.6 45.9 128.7 96.9
Sales of Produce on Exchange— Futures>
Automobiles—
U. S. Prim ary M arkets—5
Distribution in Middle W est:
Grain Receipts:
New Cars— Wholesale—Number sold.. 28 207.4 195.1 208.8 194.3
44.5 48.5 65.7 57.0
Oats ...................................................
Value .............. 28 167.6 166.3 192.6 178.3
48.0 85.9 58.7 93.9
Com ........... ........................................
New Cars— Retail — Number sold.. 48 116.6 99.6 157.0 150.2
41.5 53.9 40.0 44.9
W heat _.................................................
Value .............. 48 140.3 106.4 163.6 141.8
Grain Shipm ents:
New Cars— On Hand— Number .......... 42 122.7 124.7 153.0 190.7
55.0 55.2 68.0 67.4
Oats ...................................................
Value .............. 42 128.9 133.7 138.3 173.1
Corn ...................................................
57.5 46.4 44.6 44.2
Used Cars—
Number sold.. 41 153.0 147.5 159.4 145.2
52.1 35.3 29.0 33.9
W heat ..................- ..........................
148.7 160.0 159.8
Used Cars— On Hand— Number .......... 41 141.4
Building Construction—
Value .............. 41 128.0 128.1 129.5 126.8
Contracts awarded "(in dollars) :
122.1 118.1 132.8 131.8
166.4 146.4 113.8 149.0
Production (U. S.) : Passenger Cars......
Residential ......................................
132.3 134.3 138.6 123.7
166.6 180.5 130.3 135.8
T ru ck s..........
Total ................................................
Freight Carloadings— (U. S.) —
Perm its :
Grain and Grain Products................
82.0 86.4 81.9 86.2
95.8 122.0 99.1 97.7
Chicago .........................................Number
Live Stock .............................................
83.2 82.4 84.5 82.6
154.9 174.1 145.6 123.9
Cost......
90.6 119.6 95.8 103.1
Coal ........................................................
94.3 100.4 115.6 98.9
Indianapolis ................................ Number
85.4 132.5 73.5 94.7
Coke ........................................................
96.7 102.3 104.3 117.2
Cost......
95.9 98.9 106.4 107.2
63.4 56.7 84.5 52.6
Des Moines ........................... Number
Forest Products ..................................
38.8 36.4 38.2 146.
62.2 27.9 40.0 27.9
Cost......
Ore ..........................................................
105.3 87.6 143.3 95.v
111.2 108.7 107.4 105.5
D etroit .........................................Number
Merchandise and Miscellaneous....
100.2
94.7 152.8 149.9
101.8 104.6 100.5 100.5
Cost......
Total ...................................................
97.0 98.9 102.6 72.7
Milwaukee .....................
Num ber
Iron and Steel —
142.9 130.7 136.9 124.6
Cost......
Pig Iron Production :2
137.5 115.5 140.9 82.4
132.7 123.1 123.1 122.0
Others (45) ................................ Number
Illinois and Indiana.......................
152.2 140.2 154.2 110.1
116.2 114.4 117.1 113.1
Cost......
United States ................................
85.4
112.8 104.0 126.1
119.2 126.0 118.5 124.2
Fifty Cities .................................. Number
Steel Ingot Production— (U. S .)2..
138.1 143.8 144.9 125.5
72.4 74.4 81.0 91.7
Cost......
Unfilled Orders U. S. Steel Corp..
1919=100;
1. M onthly average of mean of production and shipments in 1923-24- :100: 2. Average daily production; 3. Monthly average
4. First Illinois internal revenue d istrict; 5. Monthly average receipts




Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102