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THE BUSINESS REVIEW THIRD FEDERAL PHILADELPHIA RESERVE DISTRICT SEPTEMBER i, 1930 By RICHARD L. AUSTIN, Chairman and Federal Reserve Agent FEDERAL RESERVE BANK of PHILADELPHIA Business and Financial Conditions in the United States Business activity declined further during July and industrial production and factory employment reached the lowest levels in recent years. Crops were damaged by prolonged drought. Wholesale prices declined further until early in August when agricultural prices increased. Money rates con tinued easy. Production and em ploym ent. Output o f factories and mines decreased by about 6 per cent during July, according to the Board’s index o f production which makes allowance for seasonal fluctuations. A number o f automobile factories were closed during part of the month and there was a substantial reduction in output of iron and steel and cotton textiles. Daily average pro duction o f bituminous coal, lumber, and shoes continued small. In the first half o f August, the output o f steel showed a further slight decrease. Some automobile plants resumed oper ations on a limited scale. Factory employment and wage pay ments decreased further, and at the middle o f July were at the lowest level since 1922. The reduction in number o f workers employed was largest at steel and automobile plants, car shops and foundries, hosiery and cotton mills, and clothing factories. There was a seasonal increase in employment in the canning, flour, and shoe industries. W orking forces at bituminous coal mines were further reduced, and the Department o f Agriculture reported an unusually small demand for farm labor. Building contracts awarded during July and the first half o f August were in exceptionally small volume, ac cording to reports by the F. W . Dodge Corporation. The reduction from June was primarily on; account o f smaller awards for public works and utility construction. Building in other lines continued relatively inactive. Feed crops and pasturage have been severely damaged by drought, which was not broken until the middle of August. The August 1 crop report o f the Department of Agriculture indi cated a corn crop o f 2,212,000,000 bushels, the smallest since 1901, and the smallest hay crop in ten years. Food crops were less severely affected, with wheat production estimated at 821,000,000 bushels, 15,000,000 bushels larger than last year. The cotton crop was estimated at 14,362,000 bales, or slightly less than a year ago. Freight car loadings have been in smaller volume than at the same season o f any other recent year. Department store sales declined in July to the lowest level since the summer o f 1924 Distribution. The sharp downward move ment o f wholesale prices continued through July, and the Bureau o f Labor Prices. Index of United States Bureau of Labor Statis tics (1926 = 100, base adopted by Bureau). Latest figure July, 84.0. PER CENT Index number of production of manufactures and minerals combined, adjusted for seasonal variations (1923-1925 average=100). Latest figure July, 95. Index num ber of factory em ploym ent and payrolls, with adjustm ent for seasonal varia tions. (1923-1925 average=100). Latest fig ures July, employm ent 84.6, payrolls 82.0. M onthly rates in the open Y ork: commercial paper rate paper. Acceptance rate on acceptances. Latest figures first 20 days in August. PER CENT market in New on 4 to 6 m onth 90-day bankers’ are averages of Page One Statistics index fell to a level 14 per cent below that o f a year ago. The most pronounced decreases from June to July were in the prices o f cattle, beef, wheat, cotton, silk, and rubber, and nearly all commodities showed some decline. During the first half o f August, prices o f grains moved up ward, reflecting the influence o f the drought. There have also been recent increases in the prices of cattle, hogs, silver, and silk, while the prices of cotton, copper, iron and steel, and rubber have declined further to the lowest levels in recent years. Bank credit. Loans and investments o f reporting member banks in leading cities decreased slightly between July 16 and August 13, largely as a result o f a decline o f $48,000,000 in security loans. All other loans showed little change, while investments increased further. Reserve bank credit outstanding in creased by about $60,000,000 during the first three weeks o f August, re flecting seasonal increase in the de mand for currency and a decrease o f about $25,000,000 in the country’s gold stock chiefly on account o f gold ex ports to France. The increase in re serve bank credit was in the form of bankers’ acceptances and United States Government securities; member bank borrowings showed little change. Money rates continued easy. The prevailing rate on commercial paper was reduced to 3 per cent around the first o f August and remained at that level during the first three weeks o f the month. Bond yields continued to decline. Discount rates at the Federal Reserve Banks o f St. Louis, San Fran cisco, and Kansas City were lowered from 4 to 2>y2 per cent during August. Business and Financial Conditions in the Philadelphia Federal Reserve District Industrial and commercial activity in this district as in the country has been at a relatively low level, and in July business generally was the dullest in years. Such seasonal improvement as has occurred in August has been less extensive than is normally ex pected. This exceptional slackness in trade and industry has been reflected in a substantial reduction in the re serve bank credit in use in comparison with other recent years when business activity was at a higher level than at the present time. Funds for commer cial purposes, moreover, have been in plentiful supply and money rates have been the lowest in years. Manufacturing. Manufacturing activ ity in July was curtailed to a much greater extent than is normally the case, and in early August the expected seasonal upturn failed to materialize, save in a few lines. Factory wage payments in this sec tion continued the sharp decline since March and in July reached the lowest level for any month since the middle o f 1924. Employment also declined noticeably and was even lower than in July six years ago. This recession has not been confined to this district alone; on the contrary, the relative decline in the country has been some what greater than here, reaching in July the lowest point since the middle o f 1922. The sharpest drop in fac tory payrolls in Pennsylvania between June and July occurred in the textile, stone, clay, and glass, transportation equipment, and metal products indus tries. The demand and prices for fabri cated metal manufactures declined Page Two further, buying by the principal con and noticeably less than a year ago. The leather industry is holding its sumers o f these products being at a comparatively low level. Orders on ground, though prices show further the books o f reporting firms have de weakness. In response to an increas creased noticeably in spite o f the ap ing demand, the daily output o f shoes parent improvement in business senti increased in July from the low level of the previous month. Advance orders ment expressed by several firms. The daily output o f pig iron con also show appreciable gains, while tinued downward, reaching in July the stocks have declined in the month and smallest quantity since 1924. Opera as compared with a year ago. Local tions o f steel works and rolling mills, tanneries also expanded their opera on the other hand, showed a slight up tions somewhat earlier than is usual turn in the index when it is cor and are now definitely on the upgrade. Activity in the group comprising va rected for the usual seasonal changes. rious food products, while showing a Other leading metal industries as a rule decline in wage payments during July, reported further declines in plant oper continued at a fairly stable level in ations and output. This is also true of point o f production. Gains over the those industries which comprise the previous month in fact have been noted transportation equipment group. in sugar refining, bread and bakery The market for textile products gen output, canning and preserving, and erally has been dull, although demand to some extent in animal slaughter in the first half o f August showed ings. At least part o f these gains, some seasonal gains. Prices o f textile especially in August, were characterfibres and manufactures have con tinued to decline, a t r e n d which has been in effect since FACTORY EMPLOYMENT the spring o f last PERCENT year. Textile pro 1923— Z5 AVG — IOO ductive activity on the whole was re duced in July to the A PHILADELP lowest level in many H IA 7 \ w ________ years. As a result, 100 ; V consumption o f raw / \ . / J '• A . materials and the -•— v ' " \ PENNSYLVA NIA \ output o f finished 90 products declined U c o r r e s p o n d in g ly . \ - A S t o c k s h e l d at 80 * \ 'P IT T .5BURGH plants for the most part have been 70 smaller t h a n in 1926 1927 1928 1929 1930 the previous month TEXTILES 1925 1926 1927 1928 1929 l§^0 1925 1926 1927 1928 1929 1930 Source: Cotton— Bureau of Census Silk— Silk Association of America istic o f the season. The daily output o f tobacco products on the whole de creased. More than the ordinary quiet pre vails in the chemical industry, reflect ing in the main unsatisfactory conditions in other lines, particularly textiles. Prices, especially o f indus trial chemicals, declined further. Plant operations generally have been curtailed more sharply than at the same time in other years. Among the principal building ma terial manufactures, the output of cement, and lumber and its products showed slight gains, after making due allowance for seasonal fluctuations, while production o f brick declined very sharply. The present level o f activity in the entire industry is the lowest in several years. Prices generally con tinue to exhibit weakness. July, 1930 (Daily average) Electric power Philadelphia Federal Reserve District 12 Systems Change Change from from June, July, 1930 1929 Per cent Per cent Rated generator capacity......... + 6 .7 ....0 .0 Generated outp ut....................... H ydro-electric......................... Steam ........................................ Purchased................................. - 1.3 - 1.1 + 4 .0 -1 2 .2 - 4 .9 -4 7 .2 + 11.9 - 2.4 Sales of electricity....................... L ighting.................................... M unicipal............................. Residential and commercial..................................... P ow er........................................ M unicipal............................. Street cars and railroads. . Industries.............................. A ll other sales.......................... + 0 .0 + 13.8 + 8 .4 - + 14.6 + 3 .4 + 19.6 - 7 .5 + 5 .0 * -3 8 .7 - 9 .9 - 5.2 + 2 .9 - 0 .5 - 6 .1 * -3 0 .1 * W orking days average. 8.1 9.3 3.9 July, 1930 Percentage change since Business indicators Philadelphia Federal Reserve District Amount July, 1929 June, 1930 Retail trade*— estimated net sales (152 stores) Department (6 4).............................................. M en’s apparel (1 8 ).............................................. W om en’s apparel (1 7 )........................................ Shoe (3 7 )............................................................... Credit (16)............................................................ $578,280 $495,523 $14,715 $46,431 $11,669 $9,942 - 5 .0 -2 5 .4 W holesale trade*— net sales (103 firms) Boots and shoes (5 )................................ Drugs (1 0)................................................ D ry goods (1 2 )........................................ Electrical supplies ( 5 ) ............................ Groceries (3 2 ).......................................... Hardware (2 2)......................................... Jewelry (1 0)............................................. Paper (7 )................................................... $258,843 $3,199 $41,751 $9,891 $15,033 $109,918 $55,719 $8,070 $15,262 -1 3 .4 - 8 .7 + 0 .3 -1 6 .1 -4 3 .5 - 5 .8 -1 8 .0 -3 0 .0 -1 9 .4 - 5 .3 - 4 .3 - 3 .8 -1 4 .4 - 4 .1 1.1 -1 0 .4 -2 5 .3 303,022 $7,329,261 p rs...................37,076 doz. p rs.........45,539 lbs................. 187,756 604,300 ton s.................. 6,225 ton s.......................174 ton s.......................179 ton s.............. 217,800 ton s.............. 379,300 -1 1 .5 -2 0 .4 + + 5 .6 -4 5 .1 -2 4 .0 -4 0 .9 + 13.4 -1 6 .7 bbls.................61,774 bbls...............115,032 K W H . . .16,030,600 - Productive activity*—Employment— 840 plants in Penna.............................................. Wage payments (weekly average)................................................ Shoe production!— 71 factories..................................................... Hosiery productionf— 132 m ills.................................................... W ool consum ption!— 69 m ills....................................................... Active cotton spindle hours (P enna.).......................................... Pig iron p roduction.......................................................................... Iron casting production— 33 foundries........................................ Steel easting production— 11 foundries....................................... Anthracite.......................................... ................................................ Bituminous coal (Penna.)............................................................... Petroleum receipts at Port of Philadelphia— domestic and foreign.............................................................................................. C em ent................................................................................................ Electric power output— 12 system s.............................................. Financial and credit— Debits (check payments)—-18 cities............................................... Loans and investments— middle of August— 90 member banks. Bills discounted held by F. R. B. of Phila. (daily average). . . Bankers’ acceptances outstanding— end of m onth..................... Commercial paper sales— 4 dealers.............................................. Commercial failures— num ber......................................................... Commercial failures— liabilities....................................................... Building and real estate— Building permits— 16 cities...................................................... Building contracts awarded.............................................................. Number of real estate deeds recorded (Philadelphia cou n ty).. Value of mortgages recorded (Philadelphia cou n ty).................. Sheriff sale— number of writs issued for August— (Philadel phia cou n ty )..................................................................................... Miscellaneous— Freight car loadings (Allegheny district)..................... Tonnage of vessels (Port of Philadelphia)................... Sales of life insurance (Penna., N. J., and D e l.)........ Automobile sales registrations of new passenger cars - 9 .2 9 .3 7 .7 - 6.6 -3 0 .5 -2 9 .6 -3 4 .1 -3 9 .3 -2 2 .5 -2 8 .3 + 0.1 - - 1.6 3 .9 1.3 4 .8 9 .4 1.4 21.2 8.8 - 1.9 - 9 .2 - 3 .9 -3 2 .2 + 5.1 - 2 .7 - 6.1 + 1.6 4 .9 - $2,374,165,000 $1,653,000,000 $24,400,000 $20,700,000 25,020,350 96 $2,513,152 -2 4 .0 + 1.9 -6 8 .4 + 38.0 + 7 2 4 .5 + 68.4 + 98.3 - 9 .8 + 0 .7 -1 3 .2 + 2 .0 + 1 9 6 .5 - 5 .0 -1 5 .2 $5,171,244 $20,362,000 4,163 $12,038,096 -8 0 .8 -4 0 .0 -2 0 .9 -5 1 .9 -5 6 .0 -6 7 .0 - 5 .9 + 3 .4 + 5 .5 -1 3 .0 -1 6 .9 2 .0 + 2 .4 + 3 .6 - 7 .7 -2 6 .9 1,263 811,178 ton s......... 4,635,408 $105,728,000 13,083 + + 0.1 -3 3 .2 * Daily average of monthly figures, t Bureau of Census preliminary figures. Page Three G O AT AND KID L E A T H E R M IL L IO N S STOCKS / V 'V -f * J J\ rT U1“1““11 1926 =6^ J-\ w OUTPUT 1928 1927 1929 1930 Source: Department of Commerce Building and real estate. The con struction and contracting industry has been fairly active, although the present level remains considerably lower than at the same season o f other recent years. Employment and wage pay ments in Pennsylvania increased fur ther between June and July, the largest percentage gain being in the western part o f the state. The proposed expenditure under per mits issued in 16 cities o f this district, however, decreased substantially in the month and as compared with a year earlier. Similarly, the value o f con tracts for new construction declined sharply, reaching in July the lowest level for that month, with one excep tion, since 1921. Awards thus far this year have been running materially be low the monthly average o f the past five years, as is shown by the ac companying table. The sharpest drop in the month occurred in contracts for industrial buildings, which in June showed an exceptionally large volume. Appreciable decreases also took place in residential buildings and public works and utilities. Building contracts awarded (000s omitted in dollar figures) First seven months, 1930 Philadelphia............... Reading....................... Scranton...................... Cam den....................... T ren ton....................... W ilm ington................. $96,178 1.749 3,067 2,539 2,611 3,969 T otal for Philadelphia Federal Reserve District, ineluding all cities. . . Per cent change from 1929 - 6 .0 -7 4 .5 + 85.2 -7 8 .1 -7 0 .2 -4 1 .1 1925-28 average —22.1 —52.5 + 6 .3 -5 0 .6 -5 0 .9 + 15.2 The real estate situation continues relatively quiet. The renting demand for less expensive houses is only fair and rents generally have declined dur ing the past three months. Sales of houses on the whole have shown no material change since last month and have been in a smaller volume than a year ago. The number o f real estate deeds recorded in Philadelphia declined further, while the value o f mortgages increased somewhat between June and July; but compared with a year ago both showed noticeable decreases. Foreclosures during August declined, following an unusually high peak in the preceding month. Coal. In anticipation o f the usual fall advance in prices, the demand by householders for anthracite improved slightly in the latter part o f July, and it has been fair since then. The daily output o f collieries increased and the total production in the month of 5,662,000 tons was the largest o f any July since 1926. Although production declined in the first three wreeks of August, it was larger than in the cor responding period of a year ago. The dullness in the market for bi tuminous coal continued through July, and there was virtually no improve ment in August. The daily output of Pennsylvania collieries declined and the total production in the month, although slightly larger than in June, amounted to 980,000 tons less than in July, 1929. Agriculture. Although moderate rains 241,477 -1 1 .0 Source: F. W . Dodge Corporation Page Four -1 0 .2 about the middle o f August served to check the withering effect o f the drought, a marked deficiency o f sub soil moisture continues to exist, the rainfalls being insufficient to provide the necessary irrigation. Late reports from the county agents indicate that the present crop conditions are gen erally lower than the government esti mates which were made as o f August 1, 1930. Early estimates o f farm in come generally are less favorable than they were at the same time in the past two years, reflecting smaller yields and lower prices. Such leading crops as corn, alfalfa hay, late potatoes, and fruit are re ported to have been seriously injured by the drought, although the degree of this damage has been less pronounced in this district than in the country. Nevertheless, the Pennsylvania tobacco crop, which gave promise o f high yields earlier in the season, has deteri orated so rapidly that its present con dition is said to be the poorest in many years. Most o f the early crops as a rule escaped the effects o f the dry weather, so that the yield and quality measured up favorably to the average o f past years. Because o f the parched grazing meadows, livestock generally have re quired additional feeding. The con dition o f dairy cattle, wffiich last month compared favorably with the July averages o f the past ten years, is now reported as only fair. Shipments of milk and cream bv farmers in the main have been in smaller volume this year than last. Distribution. Wholesale trade as measured by dollar sales declined by about the usual seasonal amount be tween June and July, dealers in all lines except paper reporting smaller DEPARTMENT A U T O M O B IL E STORES P h i LA. FED. RES. DIST. P H IL A . s EASONALLY ADJUSTED FED. REGISTRATION RES. D IS T R IC T PA SSE.NGE =? CARS SALES b u i i C 'v k / ll/ 'N / S T O C K S '"* I/ V a _____ 1 1 9 2 3 -2 5 A V G .-I0 0 1927 I 1 1929 1930 y / 3 1926 1 V \ d 1 jfK FOR SEAS ............. l i m n m i H . 1928 / i! IL A V ' 1926 X 1 i r 4, V l 1923llN DE-25/^ 4 A 'f\ \ \ V ONAL CHANGES l\ ^ I „ V 1 1 1 1927 ADJUSTED Y ,1 i -n . * . . . . . . 1928 1929 . . . . . . . . , 1930 Source: R. S. Polk Company Pennsylvania Motor List Company volumes. In the first fortnight of August, when normally wholesale business begins to turn upward, fur ther decreases were shown by many preliminary reports. In comparison with July 1929, the wholesale and jobbing trade in the ag gregate showed a drop o f more than 13 per cent, sales o f drugs alone be ing slightly larger. In the first seven months o f this year all lines had a smaller dollar volume of business than in the same period last year, the range o f the decline varying from about one per cent in drugs to 28 per cent in electrical supplies. This recession co incided with a sharp downward trend in commodity prices this year in con trast with a fair degree of stability a year ago. Latest reports show that wholesale prices have continued to decline. Stocks o f goods held by dealers at the end o f July on the whole were smaller than in the preceding month and a year ago. Collections in all lines were smaller in July this year than last. Dollar retail sales in July declined to the lowest level since the middle o f 1922. Sales in the first seven months of this year were nearly 6 per cent smaller than in the same period last year. At least part o f this de cline was due to price recessions which followed a rather steady decrease in wholesale prices since the last quarter o f 1929. Unsatisfactory industrial conditions have affected adversely the volume o f retail trade in comparison with other years. Most o f the early reports for the first part of August showed a con tinued decrease in sales, a trend which is contrary to the usual development at this season. Price recessions gen erally have been more extensive than for some time past. Retail prices o f food declined further between June and July. Inventories o f retail establishments have remained at a relatively low level, and in July they were reduced to the lowest point in many years. Turnover was a little smaller in July this year than last, but for the year to date it about equalled that for the same period last year. Collections as a rule were smaller than in July, 1929. Railroad shipments o f commodities in this section in July increased by a somewhat larger amount than is cus tomary for that month. Loadings in the early part o f August continued up ward as is to be expected at this sea son. Compared with each o f the last two years, the movement o f commodi ties has been in smaller volume, the decline being attributable chiefly to smaller shipments of coal, merchandise, and miscellaneous goods. Sales o f new passenger automobiles declined seasonally and were the low est in several years, when due allow ance is made for the usual seasonal fluctuations, as is shown by the accom panying chart. Ordinary life insurance sales in July declined seasonally, but they were higher than in any July in the last decade. Financial conditions. The credit situ ation in this district continues quite favorable to business; funds have accumulated considerably, reflecting largely the unusual slackness o f indus try and commerce and prevailing dull ness in the stock market. The discount rate o f the Federal Reserve Bank re mains at 3^2 per cent, and no change has been made in the 4 per cent re newal rate for call money in Philadel phia, but large member banks in this city report a further reduction in rates for commercial loans to prime cus tomers. The average now is little over 4 per cent, and is the lowest in several years. The settlements o f commercial and financial transactions with other dis tricts were especially favorable to the money market in this district during the four weeks ended August 20. In part this may have been due to the withdrawal o f a portion of the funds held in other districts either in the form o f deposits or brokers’ loans. The condition o f business made little additional currency necessary, and the banks were free to apply the major portion o f the funds gained in the set tlements to a reduction in reserve bank credit and the building up of reserve deposits. The gold gained in the set tlements was the principal factor in raising the reserve ratio of the bank from 83.9 per cent to the exceptionally Flow of Funds Affecting the M oney Market of the Philadelphia Federal Reserve District July 24 to August 20, 1930 (In millions of dollars) Funds gained: Gold (largely through favorable balances in interdistrict settlem ents)............................ 17.1 Unexpended capital funds of reserve bank, decrease i n ............................................. 1 17.2 Disposition of funds: Federal reserve credit in use,* decline i n . . . 8.1 Bank deposits at reserve bank,increase in . 4 .9 Treasury operations, excess of collections over expenditures......................................... 3 .3 Currency, increase in demand f o r .......................... 9 17.2 * Includes bills discounted, bills bought, and float. Page Five high figure o f 86.1 per cent on A u gust 20. City banks are nearly out of debt at the reserve bank, and country member banks, too, are borrowing in small vol ume, as may be noted from the fact that the total o f bills under discount at this bank was less than 17 millions on August 20. This was a reduction o f more than 4 millions in the past month, and was the lowest amount held in many years, lower in fact than in 1924, when the influx o f gold into this coun try and the credit operations o f the system, at a time o f low industrial activity, were influential in carrying money rates down to levels much the same as those now prevailing. During the past four weeks this bank partici pated in the purchase o f United States securities for the account o f the sys tem and its holdings o f these securities increased by over 2 millions. No pur chases o f bills have been made re cently, owing to the high buying rate o f the bank, and the bills actually in the possession o f the bank a month ago Ninety member banks Aug. 14, Aug. 13, in 20 cities Changes 1929 1930 (000,000’s omitted) Loans on securities........ Other (largely commercial) loans.................... $578 $601 623 598 - 25 T otal loans and discou nts.................. $1,201 Investm ents.................... 421 Net demand d ep osits.. . 841 Time deposits................. 458 $1,199 453 884 532 + + + $2 32 43 74 +$23 Commercial paper sales by four dealers operating in this district reached the unusually high amount o f $25,020,000 during July. This figure, which includes a small portion dis posed o f outside o f the Philadelphia district, was the highest in records going back to 1921. About threequarters o f the total was purchased by Philadelphia banks. Commercial paper sales (four dealers) Sales to Totals City banks Country banks 1930— Jan. . $ 7,0 1 2,50 0 $8,124,500 $15,137,000 Feb. . 6,9 7 5,00 0 875,000 6,100,000 Mar. 7.8 4 0.00 0 4.4 9 5.00 0 12,335,000 A p r .. 8.3 3 7.50 0 4.2 6 5.00 0 4.0 7 2.50 0 7,7 6 2,30 0 3.915.000 11,677,500 M ay. June. ,5,000,000 3.437.500 8 .4 3 7.50 0 July . 18,686,000 6,3 3 4,30 0 25,020,300 1929— July . 120,000 2,914,500 3,0 3 4,50 0 Total sales in the first seven months o f 1930 amounted to $87,900,000, more than four times the sum disposed o f in the corresponding period o f 1929. In harmony with the tendency shown in the national figures, the out standing acceptances o f banks in this district increased from $20,292,000 to $20,687,000 during July. This com pares with $15,046,000 at the end o f July, 1929. Federal Reserve Philadelphia (Dollar figures in millions) Bills discounted for member banks in Philadelphia. . . Other communi ties ...................... T o t a l b ills d is counted ............. Bills b ough t.............. United States secu rities ................... Other securities........ T otal bills and se curities ............... Federal reserve note circulation......... Member banks’ re serve deposits. . Cash reserves............ Reserve ratio............ Changes in Aug. 20, 1930 Four weeks One year $ .7 - $ .7 -$ 5 2 .7 15.9 - 3 .7 - 28.2 $16.6 .1 —$ 4.4 .8 -$ 8 0 .9 4 .4 52.3 1 .0 + 2 .1 0 + 34.5 + .7 $70.0 —$3.1 -$ 5 0 .1 124.2 - CO given for a somewhat larger group o f banks: + Page S ix have matured; the small sum remain ing on the books represents a par ticipation in bills held by another re serve bank. Member banks in four o f the larger cities o f the district report only a slight increase in loans over the last four weeks. Loans on securities declined from 508 to 498 millions, probably owing in part to a reduction in loans to New York brok ers, for the rates quoted on call loans in New York have not been especially attractive to lenders. Other loans and discounts, however, increased from 422 to 434 millions; there is a strong possi bility that at least a portion o f this in crease was due to the purchase o f com mercial paper, for sales o f this paper are said to have been active and the dullness o f industry and commerce makes it improbable that customers’ loans to finance such transactions have increased to any material extent. The weekly reporting banks show an expansion o f 11 millions in the total o f net demand, time, and govern ment deposits between July 23 and August 20, and an increase o f about 20 millions in their investment hold ings, about one-third o f which was in the form o f government securities. The banks in this group include most o f the member banks in Philadelphia, among which are large institutions whose condition is very responsive to changes in the financial situation, so that the figures which they report de serve careful attention. A chart de picting changes in their loans and in other items since the beginning o f 1928 accompanies this article. Loans have increased in recent months, but the total still is materially lower than at the peak last November, when both loans on securities and other loans were in large volume. The long de cline in investments ended early this year and since that time a plethora of funds has caused the banks to add to their holdings in an amount somewhat greater than the increase in their time deposits. In the accompanying table compari son o f changes in the past year is 28.4 143.1 + 5 .0 + 10.3 231.7 + 11.0 + 3 2.3 8 6 .1 % + 2 .2 % + 1 6 .7 % Employment July, 1930 Employment and wages in Pennsylvania Percentage change July 1930, compared with July 1929 Payrolls July, 1930 City conditions by city areas* Per cent change since July index* Per cent change since June, 1930 July, 1929 June, 1930 All manufacturing industries (51)...................................... 88.9 - 1 1 .5 - 4.8 81.9 -2 0 .4 - Metal products......................... Blast furnaces....................... Steel wks. & rolling m ills. . . Iron and steel forgings........ Structural iron w ork........... St. & hot wtr. htg. a p ......... Stoves and furnaces............ Foundries............................... Machinery and parts........... Electrical apparatus............ Engines and pum ps............. Hardware and tools............. Brass and bronze p roducts. 87.4 56.0 78.3 78.0 127.1 100.9 75.3 93.0 96.0 112.9 86.5 85.4 89.7 - 1 5 .7 -1 3 .6 -1 4 .3 -2 6 .9 + 9.1 - 3 .3 + 14.6 -1 0 .7 -1 4 .9 -2 3 .7 -1 3 .7 -1 5 .2 -1 2 .1 - 3.5 + 2.8 - 5.0 -1 3 .9 - 0.2 + 0.1 -1 0 .6 - 2 .8 - 3.1 - 1.0 - 4 .7 - 4 .4 -1 1 .7 81 .5 54.0 72.6 67.7 116.3 91.9 61.4 78.8 83.6 119.2 85.2 73.0 83.3 -2 3 .9 -1 7 .7 -2 4 .6 -3 6 .3 + 11.4 -1 8 .1 + 7 .2 -2 7 .0 -3 0 .0 -2 2 .5 -2 2 .9 -2 6 .4 -1 8 .6 - 8.3 - 0 .9 - 9 .9 -1 3 .2 - 6.7 - 3 .8 -1 7 .4 - 6 .0 - 5.4 - 6 .0 - 5.9 -1 0 .5 —15.5 - 5 .4 + 1.1 -2 4 .1 -1 6 .1 - 0 .5 + 56.2 + — 6 4 .lt 46.7 59.3 41.0 74.4 144.5 -2 0 .9 -1 9 .9 -3 5 .8 -2 3 .4 -1 3 .0 + 56.0 -1 0 .8 -1 4 .5 -1 0 .2 -1 4 .2 - 4 .6 — 2.2 Textile products........................ 86.0 C otton goods......................... 62.2 W oolens & worsteds............ 55.9 Silk good s............................... 90.0 Textile dyeing & finishing.. 89.0 Carpets and rugs.................. 6 1.5 H a ts........................................ 88.6 H osiery................................... 104.0 Knit goods, Other................ 87.6 M en’s clothing...................... 80.3 W om en’s clothing................. 68.8 Shirts & furnishings............. 125.0 -1 6 .7 -2 7 .3 -1 9 .9 -1 5 .0 -1 5 .2 - 9 .0 - 9 .3 -1 9 .8 -1 1 .8 - 9 .0 -4 2 .7 - 6 .0 - 1 1 .5 - 6 .7 - 0 .9 -1 7 .9 - 4 .5 - 6 .3 - 0 .2 -1 1 .6 - 5.1 - 4.1 -3 7 .7 ...0 .0 71 .4 47.4 51.9 79.8 82.1 43.2 72.9 81.6 86.8 65.7 63.1 109.2 -3 2 .9 -3 9 .7 -2 2 .3 -2 4 .8 -2 3 .9 -2 0 .1 -2 8 .7 -4 7 .7 -2 6 .4 -3 3 .0 -4 4 .3 -1 7 .8 - 1 8 .9 -1 3 .3 - 0 .6 -2 5 .1 -1 4 .4 - 7.1 + 1.8 -2 7 .6 - 8 .4 -1 6 .3 -4 2 .0 - 2 .8 Foods and tobacco................... Bread & bakery products . . C onfectionery........................ Ice cream ............................... Meat packing........................ Cigars & tob a cco.................. 110.0 111.4 94.5 130.0 95.0 110.3 + + + + + - 2 .0 1.5 1.4 0 .3 0 .6 4 .0 104.6 111 .5 83.3 124.8 89.8 100.3 + 1.9 + 1-1 -1 2 .2 — 5 .5 - 5.9 + 15.3 - 3 .9 - 0 .6 -1 5 .1 - 0.1 - 2 .7 - 2 .7 Stone, clay & glass prods. . . . Brick, tile & p ottery........... Cement ............................. Glass........................................ 68.1 82.0 64.6 60.1 -1 7 .9 -1 3 .7 - 6 .8 -3 2 .8 - 3 .5 - 2.1 + 3 .0 -1 3 .2 55.0 58.5 59.3 46.8 -2 8 .6 -3 3 .0 -1 4 .4 -4 3 .7 - 1 4 .1 -2 1 .1 - 1.2 -2 6 .6 Lumber products...................... Lumber & planing m ills. . . . Furniture................................ W ooden boxes....................... 74.1 73.9 68.1 72.5 - 2 5 .5 -3 0 .7 -2 9 .9 + 2.1 - 6 .6 8 .0 7 .8 1.5 69.0 70.1 64.3 66.5 - 2 9 .0 -3 0 .6 -3 3 .0 - 7 .3 + + 2 .0 0.1 3 .9 0 .8 Chemical products................... 94.5 Chemicals and drugs........... 71.9 C o k e ........................................ 100.0 E xplosives.............................. 80.2 Paints & varnishes............... 97.3 Petroleum refining............... 119.6 - 6 .4 -1 6 .5 + 6 .6 -1 0 .9 - 3 .9 - 8 .6 - 6 .4 - 6 .4 -1 0 .9 + 2 .0 - 1.6 - 6.1 98.7 96.2 70.4 85.5 94.1 95.4 - 6 .0 -1 9 .5 + 6 .9 + 4 .7 -1 3 .2 - 6 .0 -1 + - 7 .8 9 .9 1 .2 7 .8 8 .5 6 .8 Leather & rubber products.. . 97.2 .108.6 Shoes....................................... 91.6 Leather products, O ther. . . 80.4 Rubber tires & goods.......... 88.7 - 1.3 + 2 .8 - 4 .8 -1 3 .4 - 3 .8 + + - 0.1 2 .5 2 .0 5 .5 2 .4 132.1 108 7 80.2 80.5 9 5.5 - 3 .8 + 7 .4 -2 3 .0 -1 0 .4 -1 2 .0 - 3 .5 + 3 .6 -1 6 .8 - 9 .7 - 7 .7 Transportation equipment.. . . A utom obiles.......................... Auto, bodies and parts. . . . Locom otives and cars.......... Railroad repair shops.......... Shipbuilding.......................... 7 4 .9f 73.3 73.3 45.4 79.6 90.9 W age payments Building permits (value) Debits -1 1 .8 - 3 .0 -1 1 .4 -2 6 .2 - 3 .3 -1 7 .8 - 8 .7 -1 1 .0 -1 5 .4 + 3 .0 -2 0 .3 -1 2 .2 - 5 .3 -1 6 .9 - 8.1 -2 3 .7 -3 8 .1 - 4 .4 -2 0 .4 -3 1 .1 -2 3 .0 -1 6 .3 - 2 .6 -3 9 .3 -1 0 .6 - 8 .7 - 79.5 - 37.6 - 93.9 + 2 3 3 .0 + 58.6 - 83.8 2 .0 - 48.8 - 94.1 - 78.1 - 27.1 - 4 2.2 + 121.0 -1 6 .4 - 8 .5 -1 8 .7 -2 0 .4 -1 2 .4 -2 6 .4 -1 5 .5 -1 0 .2 -2 4 .3 -2 0 .4 -2 7 .9 -2 1 .3 -1 4 .6 -1 7 .2 - 3 .2 -1 0 .5 -1 0 .4 -1 0 .8 - 7 .2 -1 2 .2 -1 5 .4 - 4 .4 - 9 .3 - 5 .3 - 0 .8 - 3 .5 - 4 .1 -1 0 .6 -1 1 .5 - 1.9 + 1.6 + 1.4 - 9 .7 - 5 .7 -1 7 .0 - 2 .6 -2 6 .3 - 2 .2 -2 6 .5 -2 0 .8 -1 0 .2 -3 4 .4 -2 4 .2 -1 5 .2 -3 0 .1 -2 1 .9 July index* July, 1929 5 .4 0 .4 1.7 4 .3 0 .8 12.6 3.5 2.4 3.6 5.2 0.3 1.5 9.4 Allentown............... A ltoona................... Harrisburg............. Johnstown.............. Lancaster............... Philadelphia.......... R eading.................. Scranton................. T renton.................. W ilkes-Barre......... W ilm ington............ - 3 .0 3 .6 7 .6 2 .3 - 1.7 2 .4 4 .3 1.3 99.5 74.6 94.7 108.0 - 3 .7 -1 5 .3 - 3.1 .. 0 .0 - 5 .6 -1 2 .1 - 2 .0 - 3 .7 Anthracite.................................. + 7 .8 + 0 .9 71.6 + 2 6 .1 - 3 .4 - 9.2 92.3 - 1.7 Construction & contracting... 116.1 - 7 .4 + 5 .4 104.7 Street railways.......................... 84.4 - 7 .2 - 0.1 86.4 87.7 - 3 .2 - 7.2 Wholesale trade....................... 91.1 - 5 .0 - 0 .4 * 1923-1925 average =100. -1 2 .8 - 4 .8 + 4 .7 - 5.8 - 8.1 July 1930 compared with June 1930 A ltoona................... Harrisburg............. Lancaster............... Philadelphia........... R eading.................. Scranton................. T ren ton................... W ilkes-Barre......... W ilm ington............ -1 0 .2 - 6 .2 -1 2 .2 -2 2 .5 - 8 .5 - 6 .4 -1 1 .9 -1 5 .3 - 7.1 - 9 .5 - 3 .5 -1 0 .0 - 1.9 - 9 4 + 0 .8 - 4 .8 -1 6 .3 - 2 .9 - 4 .8 - 4 .6 -1 1 .7 - 5 .6 - 9 .3 — 5 .5 - 5 .8 - 1.5 — 10.6 - 22.2 + 4 6.0 + 31.0 - 67.9 + 36.4 + 31.8 - 8 9.8 - 67.1 — 10.8 + 12.7 + 2 0 2 .5 -2 9 .3 * Area not restricted to the corporate limits of cities given here. July 1930 —percentage change Wholesale trade Philadelphia Federal Reserve District Dry good s.............. Electrical supplies. Groceries................ H ardware............... Jewelry................... P aper....................... Net sales: 1930 compared with 1929 July Seven months - 8 .7 + 0 .3 -1 6 .1 -4 3 .5 - 5 .8 -1 8 .0 -3 0 .0 -1 9 .4 - 9.1 - 0 .9 -1 0 .0 -2 8 .0 - 2 .6 - 9.1 -2 5 .3 -1 0 .4 Stocks: July 31, 1930, compared with July 31, 1929 June 30, 1930 Collec tions during July 1930, compared with 1929 - 8 .9 -3 7 .8 - 6 .6 - 1.9 -1 5 .8 - 4 .8 -1 .8 -0 .3 -2 .0 -1 .6 + 3 .6 -3 .4 - 1.3 — 3 9 -1 2 .7 -2 8 .7 - 3 .0 -1 1 .0 - 2 1 .6 -1 6 .2 July 1930 —percentage change Retail trade Philadelphia Federal Reserve District Net sales: 1930, compared with 1929 July Paper and printing................... 97.0 Paper and wood p ulp.......... 83.1 Paper boxes and bag s......... 85.9 Printing & publishing......... 102.6 Retail trade sales Em ploy ment All reporting stores................ D epartm ent............................ in Philadelphia................... outside Philadelphia.......... M en’s apparel......................... in Philadelphia................... outside Philadelphia.......... W om en’s apparel................... in Philadelphia................... outside Philadelphia.......... Shoe........................................... C redit........................................ Seven months 9 .2 - - 9 .3 - 7 .2 -1 3 .4 - 7 .7 -1 1 .0 - 5 .2 - 6 .6 - 7 .4 - 1.1 - 5 .0 -2 5 .4 _ - 5 .6 6 .0 — 5 .2 — 7 .7 — 6 .4 __ 6 .4 — 6 .4 — 1.7 — 1.4 — 3 .7 — 5 .2 -1 0 .5 Stocks: July 31, 1930, compared with July 31, 1929 - Rate of turnover: seven months June 30, 1930 ' 1929 1930 8 .9 - 8 .9 2.11 2.12 - 9 .7 - 9 .2 -1 0 .6 - 7 .9 8 .0 7 .6 2.07 2 .08 2.28 2.31 1.67 1.66 + - -1 2 .6 -2 3 .9 -2 5 .4 -1 7 .7 - 4 .7 - 3.1 0 .2 4 .8 6.9 3 .8 1.8 7 .4 1.49 3.57 3.86 2.34 1.62 1.36 1.39 3.42 3.69 2.24 1.61 1.30 f Preliminary figures. Page Seven Synopsis o f Industrial and Trade Conditions in the Philadelphia Federal Reserve District D em an d O pera tion s Stocks M an u factu rin g Iron and Steel Blast furnaces ........................ Fair L ow er Steel works and rolling mills ....................................... Fair, som e in crease D eclined in July less than usual Foundries and machine shops .................................... U n filled ord ers fo r iron ca s tin g s O u tpu t o f iron ca s tin g s sh ow ed In creased in the m onth in creased in J uly, while for little ch an ge fro m June, while steel ca stin g s there w as little steel c a s tin g s d eclin ed ch a n g e from June Electrical apparatus .......... Slow D eclined Locomotives and c ar s . . . . L ittle ch an ge D eclined Shipbuilding Fair Increased Silk m anufactures................. Slow , som e in crea se in July Increased W ool Fair to low er T extiles dealers........................... poor, W ool manufactures ............ O n ly fair Cotton Fair to poor, p rice s low er manufactures Hosiery .... .................................... Floor coverings ................... Fair to low er d e clin e d ; F airly h e a v y , gen era lly than a ye a r a g o p rice s M od era te to h e a vy , a ye a r a g o L ow er som e poor, in cr e a s e ; Som e gain in A u g u st d e clin e d ; sm aller la rge r than M od era te to lig h t, sm a ller a m on th an d y e a r a g o than H ea vy to m o d e ra te , a year ago than la rge r p rice s L ow er than a m on th and a yea r F u ll-fa sh io n e d ra th er h ea vy , ago seam less m o d e ra te t o light P o o r, d eclin ed ; p rice s u n ch a n g ed D eclined, m u ch low er than a ye a r to low er ago M od era te, m onth little ch a n g e in the L eather p ro d u cts Shoes ......................................... Leather— sole ........................ k id ........................... Fair, som e in crea se in July, p rice s u n ch a n g ed to low er a y e a r a g o M od erate, d e clin ed Increased b u t b e lo w Fair, little ch a n g e in the m onth, Som e in crea se in July p rice s low er S to ck s la rg e r than la st m on th G ood fo r b la c k , fa ir fo r co lo r e d ; Increased in July little ch an ge in p rices Som e in cre a se in c o lo r e d kid in J uly, b la c k kid s lig h tly sm aller B uilding m aterials B r i c k ........................................... Quiet, p rices u n ch a n g ed to low er D eclined , m u ch low er than a yea r F a irly h e a vy , som e in crease in the ago m on th , la rge r than a y e a r a g o C e m e n t....................................... F airly good, u n ch a n g ed L u m b e r ....................................... P o o r, d eclin ed ; p rice s u n ch a n g ed to low er D eclined less than usual in July Paints and v a r n is h e s .......... Slow , d eclin ed ; p rice s u n ch a n g ed S lig h tly low er in July, m u ch low er M od erate, m onth than a y e a r a g o Plumbing supplies P o o r, p rices low er D eclined, m u ch low er than a yea r M od erate to ligh t, ago a year ago Fair, in crea sed ; p r ic e s som ew hat low er Increased .............. Slate ............................................ in cr e a s e d ; p rices Increased slig h tly b elow a ye a r a g o in July but M od erate to light, sm aller th a n a m on th a g o b ut la rger than last year M od era te, som e the m on th som e a ccu m u la tio n d eclin e H e a v y t o m o d e ra te , a year ago in in the sm aller than la rge r than M iscellan eous Paper ......................................... Fair, som e in crea se in the m onth S om ew hat low er M od era te to h e a v y , som e in crease in the m onth Tobacco— cigars ................... Fair, n o t m onth M od era te to light le a f........................... Rubber ....................................... m u ch ch a n g e in P o o r, p rices som ew h a t low er the S lig h tly low er U n ch an ged in the m onth Slow , som e in crea se in the m on th ; U n ch an ged to low er p rice s low er M od era te, la rger than a y e a r a g o M od era te to light B uildin g p erm its d ecre a se d in B uildin g c o n tr a c ts d eclin ed July and w ere sm aller than a sh a rp ly in July, the la rgest y e a r a go. d e cre a se o c c u r r in g in a w ards fo r in d u stria l b u ild in gs Building C oa l M in ing Anthracite ................................ Fair, fo r d o m e s tic; fa ir t o g o o d Increased in July and h igh er than H e a v y t o m o d e ra te a ye a r a g o fo r steam , som e in crease in the m o n th ; d o m e stic p rice s higher Bituminous P oor, p rices u n ch a n g ed ............................. to low er D eclined, b e lo w a y e a r a g o M od era te to light T ra d e Retail ......................................... Quiet, d eclin ed ; p rice s low er W holesale and jobbing. . . . Q uiet, p rices low er Page Eight D eclin ed in July to lo w e st p o in t in m an y y e a rs D eclined in the m o n th and sm aller th a n a y e a r a g o