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B usiness C onditions S eventh F ederal Volume 12, No. 8 R eserve T district 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 A N U F A C T U R IN G and trade in the Seventh Federal Reserve district decreased somewhat in June from the preceding month, although tw o-thirds of the reporting lines continued to record greater activity than a year ago. Production of pig iron and steel in the district remained near capacity levels. O perations and distribution in the automotive industry declined in the m onth-to-m onth com parison but showed a marked expansion over the corre sponding period of 1928, except for a drop recorded by wholesalers. A gricultural machinery and equipment sales in the thresher, combination harvester-thresher, tractor group and in barn equipment were seasonally larger during June, while sales of light machinery remained unchanged, and the total production of farm equipment fell off slightly from May; activity in all these lines remained considerably above a year ago. The furniture industry showed an ex pansion over last year; factory production increased, and the wholesale and retail sales of furniture decreased in the comparison with May. Domestic and industrial coal m ark ets were rather quiet during the month. Little change was reflected in industrial em ployment from the preceding period but the volume averaged about 7 per cent higher than a year ago. Residential contracts awarded for June in the Seventh district not only exceeded those of May but also were considerably greater than last June; total contracts fell below the preceding month but were above a year ago. Contracts awarded in residential projects for the first half of 1929, however, remained considerably under those of the same period in 1928. D epartm ent store sales declined in the Seventh district during June but were heavier than last year; an opposite trend was shown for the city of Chicago. W holesale trade in the m ajority of reporting lines was below that of May; more than half the groups had larger sales than a year ago. Retail distribution of shoes and hardw are increased and average sales per chain store decreased in both com parisons. T he production of principal crops in the Seventh dis trict is smaller in 1929 than a year ago, according to the July 1 estimates of the U nited States D epartm ent of A gri culture; notable exceptions, however, are found in winter wheat, rye, hay, peaches, and dry beans. Corn made ex cellent progress in July following a late start, but needs favorable w eather during the remainder of the growing season to assure full m aturity before early frosts. The harvesting of small grain is progressing and the farmers M August 1, 1 9 2 9 have cut a bumper crop of hay. Live-stock m arketings and June production of slaughtering establishments in the U nited States totaled less than in May, a year ago, or the 1924-28 average for the month. Sales of packing-house products were about on a level with the preceding month and in excess of a year ago. T he dairy industry recorded expansion over May, with output of butter larger and the production of cheese smaller than in the corresponding period of 1928. Prices of farm commodities trended up ward. Banking centers of the district reported a strong demand for funds, with commercial loans in relatively heavy vol ume and with loans on securities less active. Rates re mained firm. Loans and discounts of the Federal Re serve and those of member banks decreased on July 17 from the preceding month; a decline also was recorded in investments. Commercial paper dealers reported a limited to fair supply of paper and moderate demand in June, with sales larger than in May but considerably below last year. T ransactions in bankers’ acceptances aggregated less than a month previous but were ahead of 1928; openbill m arket operations and savings deposits gained in both comparisons. C REDIT C O N D IT IO N S A N D M ONEY RATES A steady demand for funds continues in the m ajority of banking centers in the district, some of them reporting slightly higher rates in recent weeks, though in general rate levels are substantially those of last month. Demand for loans on securities is less active than in the early months of the year, while commercial loans continue in relatively heavy volume. Conditions are firm in the Chi cago money m arket, with rate levels approxim ating those obtaining the middle of June—collateral loans 6 J 2 to 7 per cent, and over-the-counter loans 6 to 7 per cent. The average rate earned on loans and discounts by six large banks in Chicago during June was 6.23 per cent, com pared with the same figure in May and w ith 5.27 per cent in June 1928. Credit requirem ents in D etroit are strong, with little change in rates from a month ago; the average rate earned by five im portant banks in that city in June was 6.06 per cent, as against 6.07 per cent the preceding' m onth and 5.50 in June a year ago. The prevailing rate on commercial loans in D etroit during the week ended July 15 was 5 ^ - 6 per cent, compared with 5*4-6 for the corresponding period in June. T he total volume of bills and securities held by the Federal Reserve Bank of Chicago on July 17 amounted Compiled July 26, 1 9 2 9 to $152,289,000 as compared with $186,772,000 on the cor responding date in June and $202,606,000 on July 18, 1928. Loans to m ember banks on July 17 amounted to $121,037,000, which is below the $151,621,000 of June 19 this year and also under the $154,412,000 on the corresponding date of last year. T otal reserves of the Federal Reserve Bank have exhibited an upward trend during the past month and on July 17 totaled $571,252,000, the largest in volume since the $573,345,000 reported February 13, 1924. United States securities am ounted to $23,314,000 on July 17 as compared w ith $26,909,000 a month previous and $35,728,000 last year. Federal Reserve notes in actual circulation aggregated $340,884,000 July 17, a drop of about nine mil lion from the preceding week; on June 19 this item stood at $306,570,000. Loans and discounts of reporting member banks in the district on July 17 totaled $2,618,448,000, continuing an upward trend evident since the first of the month, for which an increased volume of commercial loans in Chicago and D etroit is mainly responsible, though in the latter city security loans also have shown gains since the end of June. O n June 19 the aggregate loans and discounts of reporting member banks were $2,636,567,000. Invest m ents have moved steadily downward in volume since June 19, the total on that date being $704,367,000, which on July 17 had declined to $691,114,000. N et demand de posits of reporting member banks in the district are at a considerably higher level than a month ago; $1,876,534,000 was reported July 17 as against $1,805,549,000 June 19. Tim e deposits showed a similar movement, $1,228,115,000 on July 17 com paring with $1,225,381,000 June 19. June sales of commercial paper in the Middle W est exceeded those of the preceding month by 5.7 per cent but were 23.2 per cent smaller than last year, according to a compilation for nine reporting dealers. Individually, however, three of these firms experienced a recession in business from May and three found it at a higher lever than a year ago. The supply of paper continued limited to fair, and the demand remained moderate. Four Chicago dealers reported a larger volume of sales in the aggregate during the first half of July than in the corresponding weeks of June; supply and demand showed some improvement and averaged between fair and good. June quotations ranged from 5^4 and 6 per cent for low (largely 6 per cent) to 6)4 and 6)4 per cent for high, w ith 6 to 6)4 per cent pre vailing as the custom ary charge. Selling rates opened on July 15 at 6 per cent for low and 6)4 per cent for high, and averaged 6 per cent. O utstandings of five dealers in the Middle W est decreased 4.6 per cent on June 29 from May 31 and were 27.6 per cent below a year ago; outstandings of tw enty-three dealers in the U nited States am ounted to $273,000,000 in comparison with $304,000,000 a m onth previous. The average weekly transactions of five dealers in the Chicago open bill m arket increased from June 13 to July 17 over the preceding period by 101.3 per cent in the quantity of purchases, 305.6 per cent in receipts from other offices, 150.7 per cent in the am ount of sales, and 27.9 per cent in shipments to other offices. Gains of 175.9, 610.3, 394.1, and 34.7 per cent, respectively, were recorded over last year. Dealers reported a relatively light supply of bills during the period; some firms found it good at times. Demand ranged between fair and good with preference shown for ninety-day maturities. Bills were drawn against grain, cotton, packing-house products, wool, dairy products and poultry, machinery, cement, sugar, dollar exchange, Page 2 malt, iron, tin, celluloid, automobiles, tim ber, merchandise, and miscellaneous commodities. Selling rates declined from the preceding m onth and closed on July 15 at 5% per cent for all maturities. Portfolios exceeded those of June 12 by 32.1 per cent and were 19.7 per cent heavier than last year. Fourteen banks in the Seventh Federal Reserve district reported 13.0 per cent fewer bills accepted by them during June than in the preceding month; the volume of sales also decreased 18.5 per cent, while the quantity of pur chases increased 21.2 per cent. Gains of 5.8, 86.3, and 530.0 per cent, respectively, were recorded over last year. Ac ceptances of three Chicago banks for the first half of July increased considerably over the corresponding two weeks of June and were drawn for grain, machinery, pack ing-house products, iron and steel, copper, textiles, coffee, wool, canned goods, tin, industrial spirits, tobacco, hides, cotton, chemicals, sugar, fertilizer, and miscellaneous com modities. June 29 liability for outstandings was 1.5 per cent less than at the end of May but exceeded that of the corresponding date last year by 25.6 per cent. Portfolios decreased 60.6 per cent from the preceding m onth and 48.2 per cent from a year ago, w ith half of the individual banks reporting increases in both com parisons. These holdings contained 24.8 per cent more of the originating banks’ own bills than a m onth previous. The Federal Reserve Bank of Chicago bought $10,782,955 of bankers’ acceptances during June as compared with $21,078,287 in May, and had $7,269,742 in this class of securities on hand June 29. Volume of Payment by Check—T hirty-eight clearing house cities in the Seventh district reported an aggregate volume of paym ent by check of $7,270,444,000 in June, which was 1.5 per cent below May and 1.1 per cent greater than in June 1928. The four larger cities, Chicago, D e troit, Milwaukee, and Indianapolis, dropped 1.6 per cent below May, but gained 1.0 per cent over June 1928. T hirtyfour smaller reporting centers declined only 0.8 per cent from the preceding month and increased in the aggregate 1.8 per cent over the corresponding m onth of last year. The city of Chicago with $4,445,223,000 as the total of debits to individual accounts in June, fell short of the May aggregate by 0.8 per cent, and was 0.3 per cent below June a year ago. V O LU M E OF P A Y M E N T BY C HECK C he ck s D r a w n on C le a r i n g H ou s e B a n k s , 7 th D i s t r i c t s yCMCAfiO.DCTWr. •out Z *v ~ ‘ SI CLCAA1UB a <TTRS '923 1924 1925 192b 1927 1928 — 1929 F i g u r e s u s e d a r e e s t i m a t e s f o r c a l e n d a r m o n th s , b a s e d o n w e e k ly r e p o r t s to t h i s b a n k . L a t e s t f ig u r e s , J u n e , 1929, i n t h o u s a n d s o f d o lla rs : C h ic a g o , D e t r o i t , M ilw a u k e e , a n d I n d ia n a p o lis , 6,185,304; 31 O t h e r C l e a r i n g H o u s e C e n t e r s , 1 ,0 30 ,4 48 . Savings Deposits—Seventh district savings increased 0.06 per cent in num ber of accounts, 0.5 per cent in aggregate deposits, and 0.5 per cent in average account on July 1 over the figures of a m onth previous, according to a com pilation for 197 banks. Gains of 2.4 per cent in number of accounts and 1.2 per cent in total deposits were re corded in the comparison w ith a year ago, although the average account showed a decline of 1.2 per cent. In dividually, more than three-fifths of the banks reported an increase in deposits over June 1, and the same number showed a gain over July 1, 1928. A decrease in the num ber of accounts in Michigan and W isconsin, together with a decline in average and total deposits in Indiana and Iowa marked the only recessions in state totals from a month previous. Illinois was the one state falling below a year ago in num ber of accounts and total deposits. In average account, however, all states were under the cor responding period of 1928. AGRICULTURAL PRODUCTION AND FOODSTUFFS Present indications point to a considerably smaller crop of corn for the Seventh Federal Reserve district this year than in 1928, although the plants have made excellent progress in July, following unfavorable growing weather in June and the late start this spring. There was consider able variation in size of the plants even in the same locality, so that July 15 found some corn tasseling, much of the crop laid by, a goodly portion knee to waist high, and a number of fields only a few inches above ground. Some counties in central Indiana and Illinois! and in parts of Iowa reported more or less damage to corn because of washing rains and heavy winds during the latter part of June and the first half of July. The harvesting of w inter wheat and rye is well under way, with production in excess of last year but below the ten-year average and somewhat smaller than anticipated a month ago. Cool w eather has been beneficial to oats because ripening of the grain has been delayed some what, thereby perm itting the kernels to attain greater plumpness; the straw is short in many parts of the dis trict. A large crop of hay has been cut despite interrup tions by frequent rains. CROP PRODUCTION E stim ated by the B u re au of A g ric u ltu ral Economics as of Ju ly 1 (I n thousands of bushels unless otherw ise specified) S e v e n t h D i strict F orecast F inal U n i t e d S tates F orecast F in al 5-Y r. A v. 1929 1928 1929 1 928 C orn ...............................880,841 1 ,017,822 2 ,6 6 2 ,0 5 0 2 ,8 35 ,6 78 O ats ...............................513 ,2 16 624 ,0 72 1,2 47 ,1 47 1,448,677 W in te r W heat ............ 59,537 36,411 582 ,4 92 578,133 Spring W heat ........... 4,697 6,582 2 51 ,3 77 324 ,0 58 B arley ............................ 65,801 ( a ) 8 4,181 ( a ) 317 ,2 64 356 ,6 67 Rye ................................. 9 ,2 2 6 (a ) 7 .2 6 4 (a ) 4 1,94 9 41,67 6 Flax — ......................... 2 1 9 (f ) 3 2 0 (f ) 19,885 18,690 Potatoes (w h ite ) ........ 59,221 7 6,982 379 ,2 90 464 ,4 83 Potatoes (s w e e t)........ 1 .5 4 3 (b ) 1 .5 8 1 (b ) 77,127 77,661 .......... 4 9 6 (c ) 5 2 6 (c ) 7,633 7,101 S ugar B eets* Apples (to tal cro p ).... 1 8 .3 7 4 (a ) 1 9 .9 7 0 (a ) 154,302 185,743 Peaches ........................ 4 .4 5 7 (d ) 3 .4 4 9 (d ) 47,075 68,37 4 Pears ............................ 1 .4 3 0 (d ) 1 .6 9 4 (d ) 19,781 2 4,012 5 .9 7 2 (c ) 18,223 16,630 D ry B eans ................... 7 .1 4 2 (c ) Broom C orn* ............. 4 .8 (e ) 4 .8 (e ) 52.8 54.5 T obacco** ................... 47,066 49,005 1,492,508 1,378,139 16,781 98,991 92,983 All Tam e H a y * ........... 22,216 1923-27 2,7 46 ,7 40 1,345,081 549,257 260,411 208,783 54,793 23,243 382,756 78,045 7,462 183,452 52,224 20,211 17,058 56.3 1,330,576 92,810 * I n thousands of tons. * * I n thousands of pounds. ( a ) Five states in clu d in g Seventh d istric t, (b ) In d ia n a , Illin o is, Iow a, ( c ) M ichigan, W isconsin, (d ) In d ia n a , Illinois, M ichigan, Iow a, (e ) Illinois, ( f ) W isconsin, Iowa. Grain Marketing—June receipts at interior prim ary m ar kets in the U nited States increased for wheat and corn and decreased for oats in the comparison with the preceding m onth and the five-year average; those of each grain gained in volume over last year. Reshipments from these centers declined from May, although the quantity of oats and wheat exceeded that for the corresponding period of 1928 and shipments of the latter grain were greater than the 192428 average for June. Visible supplies of grain in the United States on July 13 were considerably above a year ago, with greater holdings of w heat and corn and smaller stocks of oats, rye, and barley than on the corresponding S atur day in June. Transactions in grain futures by members of the Chicago Board of Trade exceeded those of May by 3.3 per cent and were 17.2 per cent heavier than a year ago. Chicago prices of wheat, corn, and oats advanced over the May level. Q uotations for rye trended upward during June, but averaged less than in the preceding month. Movement of Live Stock—June receipts of live stock at public stock yards in the U nited States were less than in May and considerably below last year and the 1924-28 average for the month. LIVE STOCK SLAUGHTER C attle Y ards in Seventh D istrict, Ju n e, 1929 .................... 186,445 Federally Inspected S laugh ter, U . S. Ju n e , 1929 ................... 6 36 ,2 78 M ay, 1929 .................... 676 ,2 97 Ju n e, 1928 ................... 705,525 L ambs and S heep Calves 741,083 249,321 94,665 3 ,7 55 ,6 20 3 ,7 97 ,9 18 4 ,0 78 ,0 12 1,107,785 1,201,852 1,109,427 344,306 4 26,667 3 98,119 H ogs Reshipments of sheep and lambs to feed lots increased slightly in June, while those of cattle and calves showed a custom ary recession as compared with the preceding month; the movement was smaller than a year ago. AVERAGE PRICES OF LIVE STOCK (P e r h u n d re d pounds a t Chicago) W eek E nded J u l y 20, 1929 N ative Beef Steers (a v e ra g e )....$14.85 F a t Cows and H e ife rs..... .............. 10.35 Calves .................................... .............. 15.50 H ogs (b u lk of s a le s )......... .............. 11.50 Y earling Sheep .................. .............. 11.85 Lambs .................................... .............. 14.55 J un e 1929 $14.20 10.90 13.70 10.75 11.50 15.25 M onths M ay 1929 $13.65 11.00 12.65 10.95 11.25 14.20 of J une 1928 $13 .9 0 10.25 12.85 10.00 13.60 16.60 M eat Packing—A smaller tonnage of packing-house com modities was produced by slaughtering establishm ents in the U nited States during June than in May, a year ago, or the 1924-28 average for the month. The number of em ployes covered by the last payroll in June was 1.6 per cent greater than a month previous, and gains of 11.5 and 9.5 per cent, respectively, were shown in hours worked and total earnings, the two last-m entioned increases being largely accounted for by an additional w orking day in the current period. Trade in domestic m arkets expanded some w hat for sausage, bacon, smoked meats, and other hot w eather specialties, averaged fair for dry salt pork and smoked ham, was good for veal, and quiet for lard. D e mand for beef and lamb improved during the first half of the month but tended to drag at the close; an opposite trend was shown for fresh pork. June sales billed to domestic and foreign customers by fifty-eight m eat pack ing companies in the U nited States totaled 0.5 per cent more in value than in May and 6.3 per cent in excess of last June. Domestic demand improved early in July over the preceding m onth and ranged between fair and good. Inventories of packing-house products in the U nited States aggregated slightly less on July 1 than a month previous or a year ago, but remained above the 1924-28 average for the beginning of July. Stocks of beef, lamb, and miscel laneous meats were in excess of last year; those of dry salt pork and pickled beef decreased from the five-year average, and holdings of lard and lamb increased in the comparison with June 1. Chicago quotations for the m ajority of pork products, beef, and veal firmed in June over the preceding period; dry salt meats advanced in price, while pork loins declined. Prices of lamb, m utton, fresh skinned hams, fresh spare ribs, and pork trim m ings trended downward during Page 3 The volume of creamery butter billed to custom ers by sixty-nine companies in the Seventh district gained 14.2 per cent in June over a m onth previous and 6.4 per cent over the corresponding period of 1928. Inventories of dairy products at cold-storage warehouses and packing plants in the U nited States showed a seasonal expansion on July 1 over the beginning of June; stocks of butter and cheese increased and holdings of eggs decreased in the com parison with a year ago and the 1924-28 average for July 1. W isconsin factories supplied the prim ary m arkets of that state w ith a 30.4 per cent greater tonnage of American cheese during the four weeks ended June 29 than in the preceding period, while distribution from these centers increased 22.0 per cent; declines, however, of 9.2 and 8.1 per cent, respectively, were recorded from last year. June receipts of butter at Chicago were larger than in 1928, but those of eggs and cheese were smaller; the quantity of butter and cheese increased as compared w ith May and th at of eggs decreased. Chicago quotations for butter were a little firmer during June than a month previous; egg and cheese prices eased slightly. the first two weeks and then firmed, the average for the month being somewhat below that of May. Shipments for export were reduced slightly in the ag gregate for June from the preceding month; individually, however, a m ajority of the companies reported practically the same volume as in May. Foreign trade in meat and lard was rather quiet during the month as a whole, though fairly good at times; some firms experienced a little im provement in the demand for lard and other fats over a month previous. July 1 consignment inventories of pack ing-house products, already landed in foreign countries or in transit to Europe, showed little change from June 1. Prices averaged below Chicago parity. D airy Products—Sixty-seven creameries in the Seventh Federal Reserve district manufactured 9.5 per cent more butter, in the aggregate, during June than in May, the volume being above the five-year average for the month and 4.5 per cent in excess of a year ago. W eekly figures compiled by the American Association of Creamery B ut ter M anufacturers show that production in the U nited States also expanded over the preceding month and last year. WENT CONDITIONS INDUSTRIAL EMPL showed expansion, especially canning and preserving and the m anufacture of ice; leather products; and the paper and printing group in which the paper mills were mainly responsible for the total gain. Metals and metal products showed a further downward trend in num ber of men but not in payrolls; vehicles declined more sharply, both in men and payroll am ounts, the automobile industry show ing definite curtailm ent in operations. The stone, clay, and glass products group also recorded a decline, although in this group the cement industry reported a gain. Reports on employment outside m anufacturing plants indicate some gain in sales forces, especially at retail stores, as well as a continued steady expansion in build ing and construction work. Public utilities registered a decline in employment and there was a reduction in the number of w orkers at coal mines. For Illinois, the un em ployment ratio as reflected in the num ber of applicants for positions available at the free em ployment offices, registered an increase, rising from 124 per cent in May to 139 for June; in Indiana there was also an increase from 100 per cent to 113; while Iow a showed a drop from 244 per cent to 232. Industrial em ployment within the Seventh Federal Re serve district remained practically stationary in aggregate volume during the period May 15 to June 15, plants with an approxim ate total of 350,000 w orkers showing a decline of 0.1 per cent. Payroll am ounts at these plants increased 0.6 per cent, a partial recovery from the decrease of 1.4 per cent reported for the previous period. The slight in dication of a downward trend in the volume of industrial employment is the first since January and follows a steady rise during the past four m onths am ounting to 4.9 per cent for the period. Payroll am ounts during these same m onths registered an increase of 9.2 per cent and on June 15 were alm ost 10 per cent higher than on January 15. In the comparison with a year ago employment, as represented by reporting plants, is approxim ately 7 per cent heavier, both in number of w orkers and in payroll amounts. Industrial groups recording gains in both men and payroll am ounts over the preceding month were the tex tiles and textile products, an increase mainly due to sea sonal activity in the clothing industry; food and related products, in which group a m ajority of the industries EMPLOYMENT AND EARNINGS—SEVENTH FEDERAL RESERVE DISTRICT N umber I nd u str ia l G roups A ll groups ( 1 0 ) ........................................................ ......... M etals an d metal products (o th e r th an vehicles) V ehicles ................................................................................ T extiles and te x tile p ro d u cts....................................... Food a nd related pro d u cts.............................................. Stone, clay, and glass p ro d u cts..................................... L um ber a n d its p ro d u cts........................... .................... Chem ical p roducts ........................................................... L eath er pro d u cts .............................................................. R ubber products ................................................................ P a p e r an d p rin tin g ........................................................... W J u n e 15 1929 350,393 138,556 41,866 25,083 45 , 6 2 1 14,314 27,955 10 , 7 7 3 14,747 4 ,0 6 7 27,411 eek of W age E arners E nded M ay 15 1929 350,812 139,735 43,200 23,989 44,721 14 . 4 9 7 28,088 10 ,7 83 14 ,4 23 4,164 27,212 T otal E a r n in g s W eek E nded J u n k 15 M ay 15 19 2 9 1929 P er C ent C hange — — — -f + — — — + — + 0.1 0.8 3.1 4. 6 2 .0 1.3 0.5 0.1 2.2 2.3 0.7 $10,178,761 4,396,346 1 ,2 4 5 ,5 6 1 617,763 1 ,2 2 5 ,9 0 1 422,663 669,032 281,684 326,946 94,730 898,135 $10,113,971 4,3 91,888 1,302,009 563,971 1,161,323 438,073 664,796 294,119 309,414 93,666 894,712 P er C en t C hange + 0.6 — + + — + — + + -f 4.3 9.5 5.6 3.5 0.6 4.2 5.7 LI 0.4 + 0.1 MANUFACTURING ACTIVITIES AND OUTPUT Automobile Production and Distribution—A further re cession was recorded in automobile production for June, but output was maintained at a higher rate than a year ago. Production of passenger automobiles totaled 452,641, Page 4 or 12.3 per cent less than in May and 27.1 per cent greater than in June last year. F or the first half of 1929 output of 2,772,277 cars has aggregated 41.2 per cent above the same period of 1928. T ru ck production totaled 91,296 for June, against 86,647 in the preceding month and 40,174 a year ago; output for the half year increased 86.9 per cent over the first six months of last year. Both passenger car and truck output have made records for the half-year period. M iddle-W est distributors report a smaller volume of cars sold at wholesale during June than in either the month previous or June 1928, while sales at retail continued to decline in the m onth-to-m onth comparison but were much larger in number than a year ago; the value of retail sales, however, shows a smaller gain over last June. Used cars sold increased over May and over June 1928. D istribution of new cars at wholesale and retail and sales of used cars have aggregated considerably larger during the first six months of 1929 than in the same half of last year. Stocks of new and used cars on hand the end of June fell below those held the last of May, but continued heavier than a year ago. Deferred paym ent sales consti tuted 51.6 per cent of the total retail sales during June of forty-tw o dealers reporting the item, which compares with 54.0 per cent in May and 41.0 per cent for seventeen dealers in June last year. MIDWEST DISTRIBUTION OF AUTOMOBILES Changes in Ju n e, 1929, from previous m onths P er C e n t C h an ge F rom M ay J un e 1929 New cars W holesale— N um ber sold .............. — 19.3 V alue ....................... .... — 22.4 R etail— N um ber sold .......... 8.5 V alue ........................ ....— 15.2 On hand Ju n e 29— N um ber ................... ....— 15.6 V alue ....................... ....— 14.6 U sed cars N um ber sold .......... .....+ 2.2 Salable on han d — N um ber ................... ....— 13.0 V alue ........................ ....— 10.1 1928 C o m p a n i e s I ncluded M ay J une 1929 1928 — 11.9 — 15.9 38 38 27 27 + 37.9 + 9.0 65 65 41 41 + 14.6 + 33.3 66 66 42 42 + 23.0 65 41 + 48.1 + 12.5 64 64 40 40 Agricultural Machinery and Equipment— Sales of agricultural machinery and equipment billed to domestic and foreign customers expanded in June, a customary trend at this time of year, the gains am ounting to 20.5 per cent in the thresher, combination harvester, tractor group, 23.7 per cent in the barn equipment group, and 0.1 per cent in light machinery. The volume sold exceeded that of last June by 34.3 per cent in the light machinery group, 31.2 per cent in barn equipment, and by 3.9 per cent in the heavy machinery group. PRODUCTION AND SALES OF FARM EQUIPMENT IN THE UNITED STATES Changes in Ju n e, 1929, from previous m onths P er Ce n t C hange F rom M av ay J une 1929 1929 192 8 D om estic sales billed......................... + 8.9 8. 9 + 10.2 +f-15.3 15.3 + 54.4 Sales billed for export........................ — T otal sales billed................................. -j-10.1 + 10.1 + 16. 9 + 21.8 P roduction ......................... ................... — 3.8 P ro d u ctio n com puted from Sales based on value. average em ploym ent d u rin g C o m p an i es I ncluded 72 36 72 71 the m onth. Iro n and Steel Products—Steel producers of the Chicago district report that activity during June was maintained at approxim ately the same high level as in earlier months this year; operations continued at about capacity rate, demand has held up well, and order books are considerably larger than a year ago at this time. The first half of 1929 has established a record for the industry in this district. Pig iron also continued active through June, production in Illinois and Indiana slightly exceeding in the daily aver age the previous high point for May. U nited States output of pig iron fell below the May level, but was heavier than in any previous month on record, which was also true of steel ingot production for the country. A decline of 47,257 tons from May 31 took place on June 29 in unfilled orders of the U nited States Steel Corporation, which totaled 4,256,910 tons; however, the volume was larger than usual at this season. Chicago prices of finished steel have shown no change, and scrap iron and steel prices have remained steady since the latter part of June. The tonnage of orders booked by steel and malleable casting foundries in the Seventh Federal Reserve district again declined in June and for the first time this year fell below the corresponding m onth a year ago; shipments and production fell off seasonally but exceeded the volume of June 1928. O rders booked, production, and shipments of reporting stove and furnace m anufacturers in the district were smaller in June than in the preceding month, but registered gains over June last year. Shoe M anufacturing, T anning, and H ides—Shoe factories in the Seventh Federal Reserve district decreased their m anufacturing operations 2.9 per cent during June from the preceding month, according to preliminary statistics re leased by the U nited States D epartm ent of Commerce. The production and sale of leather by district tanneries exceeded that of May, with the form er showing a recession and the latter an expansion from a year ago; individually, however, more than half of the reporting firms recorded a decrease in sales from 1928. A slightly smaller quantity of packer green hides and a larger number of packer calf and kip skins were sold on the Chicago m arket during June than a month previous; total shipments from the city and purchases by district tanneries increased. Q uotations advanced. F urniture—The volume of new orders booked during June by twenty-five furniture m anufacturers in the Seventh Federal Reserve district declined 12,9 per cent from May, but as compared w ith a year ago showed an increase of 45.2 per cent. In the form er comparison, about tw o-thirds of the firms reported a drop in orders booked, while in the latter slightly more than half of the firms recorded a decline. Shipments fell off 2.4 per cent from the preceding m onth but totaled 28.8 per cent more than in June 1928. Unfilled orders on hand June 29 approxim ated those on May 31, though exceeding the am ount on the corresponding date last year by 71.6 per cent. O perations increased slightly over May and were also greater than a year ago. BUILDING MATERIAL AND CONSTRUCTION ACTIVITIES Shipments of cement from plants within the district con tinued to expand seasonally during June and also showed an increase over the corresponding month last year. To date, however, the total volume shipped has been about 6.0 per cent less than during the first half of 1928, so that while production has also been somewhat curtailed, stocks on hand have been increasing heavily. The volume of cement going into consumers’ hands within the district is shown on the accompanying chart which indicates a decline of 13.2 per cent for the first five m onths of 1929 as compared w ith the corresponding period of 1928. T he volume received during May, of 4,461,030 barrels, was 60.0 per cent larger than in April but 17.7 per cent below May 1928. The brick industry registered a decline in operations dur ing June, production and shipments falling off from the seasonally high level of the preceding month. Page 5 yards averaging 0.6 per cent less than for May, although 5.9 per cent above June 1928. O utstanding accounts of these yards were 270 per cent of sales as compared with 254 per cent on May 31 and with 287 per cent June 30, 1928. Stocks at retail showed little change in either the monthly or yearly comparison, while at wholesale a slight curtailm ent was reported from a year ago. Receipts of lumber at Chi cago as well as shipm ents out of that city were 1.7 per cent less than in the preceding m onth and also below the volume moved a year ago. For the first half of 1929 re ceipts have totaled 7.8 per cent under the corresponding period of 1928, while shipments out of the city have been 0.6 per cent larger. C e m e n t r e c e i v e d a t p o in ts w i t h i n t h e fiv e s t a t e s in c lu d in g t h e S e v e n th F e d e r a l R e s e r v e D i s t r i c t (I llin o is , I n d i a n a , Io w a , M ic h ig a n , a n d W is c o n s i n ) b y m o n th s . L a t e s t fig u re , M a y , 1929 : 4 ,4 6 1 ,030 b a r r e ls . The June lumber sales reported by eighteen wholesale and m anufacturing concerns of the Seventh Federal Re serve district exceeded those of the preceding m onth by 2.6 per cent in dollar volume and 3.4 per cent in board foot measure. A gain of 0.8 per cent over June 1928 was also registered in dollar sales but the board foot volume de clined 5.5 per cent in this comparison. Demand from both industrial plants and retail yards was principally for immediate needs and filling-in purposes. O utstanding ac counts of reporting firms increased considerably during the m onth and on June 30 were 124 per cent of m onthly sales as compared with 118 per cent a month earlier and 117 per cent a year ago. In the retail m arket there was a slight decline in demand for lumber, dollar sales at 199 Building Construction— Building contracts awarded in the Seventh district totaled $134,831,798 during June, $58,957,641 or 43.7 per cent of which was for residential con struction. T otal awards were 4.7 per cent less than in May but 4.8 per cent larger than in June a year ago. Resi dential contracts registered increases of 35.5 and 18.0 per cent, respectively, in the two comparisons, so th at the total volume of such contracts for the year so far is but 19.6 per cent below the corresponding period last year. The decline in total building awards for the same period am ounts to 7.6 per cent. T he issue of perm its in ninetyone cities of the district recorded a decline in both the m onthly and the yearly comparison, estim ated cost falling off 33.3 per cent in the form er and 21.5 per cent in the latter. The number of perm its issued was smaller by 16.4 and 5.7 per cent, respectively. The estimated cost of building for which perm its have been issued in the first half of 1929, is approxim ately 20 per cent smaller than last year. MERCHANDISING CONDITIONS Wholesale Trade—Sales declines were recorded in June from May in the m ajority of reporting lines of whole sale trade, while four of the six groups had larger sales than in June a year ago. Conditions in the hardware, dry goods, and electrical supply trade continue, as in recent months, to reflect improvement over the corresponding period of 1928, both sales and collections gaining in the comparison, although several of the individual reports in dicate slower collections in electrical supplies. In the first half of 1929, sales of wholesale hardw are firms have totaled 7.4 per cent above the same six m onths of 1928, those of dry goods firms 9.0, drugs 5.0, electrical supplies 21.5, and shoes 0.4 per cent more, while grocery sales have been 0.7 per cent smaller. Prices are steady in most groups, though somewhat firmer for wholesale groceries. W H O L E S A L E T R A D E D U R IN G T H E M O N T H O F J U N E , 1 9 2 9 N et Sales D u rin g M onth Stocks at E n d of M onth P er C en t C hange F rom P receding S am e M o nth L ast Y ear M o n th G roceries . H ardw are D ry Goods D rugs ....... Shoes ....... E lectrical Supplies (2 9 )+ (1 5 )— (9 )+ (8 )— (8 )— (3 6 )— 0.8 3.5 0.1 3.5 7.4 3.2 ( 2 9 ) — 2.3 ( 1 5 ) + 7.3 ( 9 ) + 2.0 ( 8 ) + 0.9 ( 8 ) — 5.8 (3 6 ) + 18.3 P er C e n t C hange F rom P receding S am e M o n th L ast Y ear M o n th (2 0 )+ (1 0 )— (7 ) + (7 )— (6 )— (3 0 )+ 0.3 2.9 4.7 6.1 7.2 4.1 ( 20) + 6.6 ( 1 0 ) + 7.1 ( 7 ) — 5.2 ( 7 ) + 3.1 ( 6 ) — 6.4 (3 0 ) + 2 7 .4 A ccounts O u tstan d in g E n d of M onth Collections D u rin g M onth P er C en t C h ang e F rom R atio to P receding S am e M o n t h N et S ales M o n t h L ast Y ear D u r in g M o n t h (2 6 )+ (1 5 )+ (9 )— (7 )— (7 )— (3 6 )+ 0.7 0.5 1.3 3.3 4.0 0.4 ( 2 6 ) — 5.7 ( 1 5 ) + 7.8 ( 8 ) + 4.5 ( 8 ) + 2.0 ( 7 ) + 2.0 (3 6 ) + 2 6 .8 (2 6 ) (1 5 ) (9 ) (8 ) (7 ) (3 6 ) 99.0 193.9 301.6 142.7 290.8 139.8 P er C e n t C h ang e F rom P receding S a m e M o n th M onth L ast Y ear (2 4 )+ (I D — (8 )— (6 )— (6 ) + (2 8 )— 2.0 1.4 1.4 8.5 3.7 2.6 ( 2 2 ) — 4.1 ( 1 1 ) + 3.0 ( 8) + 2.2 ( 6 ) — 1.4 ( 6 ) + 2.6 (2 7 ) + 2 5 .9 F igures in p arentheses indicate n u m b er o f firms included. Department Store Trade—A decline of 3.9 per cent from May and a gain of 2.9 per cent over a year ago, took place in aggregate June sales of ninety-seven Seventh district departm ent stores. Chicago stores recorded a slight increase in the comparison with May, but Detroit, Indianapolis, Milwaukee, and stores in smaller centers shared in the decline shown. As compared with June last year, sales of Chicago firms totaled 1.8 per cent less, and the aggregate for sixty-tw o stores in the smaller cities registered practically no change, while data for D etroit, Page 6 Indianapolis, and Milwaukee showed m oderate gains. For the first half of 1929, departm ent store sales in the dis trict have been 3.7 per cent heavier than in the same period of 1928, both the larger and the smaller cities recording expansion. Stocks on June 29 averaged 6.1 per cent lower for the district than a m onth previous, but continued above the level of a year ago, being 4.7 per cent larger than on June 30, 1928. Stock turnover for June this year was very slightly less than for the same m onth of 1928, and turnover for the six m onths’ period shows little change, averaging 1.91 times for 1929 against 1.90 a year ago. T otal collections gained 1.3 per cent in June over a month previous and were 6.5 per cent above last June, while accounts outstanding the end of the month declined 0.6 per cent in the monthly and increased 12.1 per cent in the yearly comparison. The ratio of June collections to accounts outstanding the end of May averaged 40.0 per cent this year, compared with 41.2 per cent for the cor responding period of 1928. O ther Retail T rade—Sales of shoes during June by tw enty-six retail dealers and tw enty-four departm ent stores exceeded those in May by 8.5 per cent and totaled 10.6 per cent greater than for the corresponding month last year. The increase in the m onth-to-m onth comparison was accounted for largely by heavier sales of departm ent stores, as less than one-third of the dealers showed gains, while five-eighths of the departm ent stores had increased sales. As compared with a year ago, more than half the departm ent stores reported smaller sales, and almost threefourths of the dealers recorded gains. F or the first half of 1929, sales exceeded the corresponding period of 1928 by 4.8 per cent. Stocks of dealers and departm ent stores averaged 7.8 per cent smaller the end of June than a month previous, but were 11.2 per cent heavier than a year ago. Dealers’ collections gained 2.0 per cent over May, though declining 2.6 per cent from last June; accounts receivable the end of the m onth showed an opposite trend, being 3.9 per cent less in the m onthly but 10.9 per cent larger in the yearly comparison. Accounts receivable averaged 65.1 per cent of June sales, against a ratio of 63.5 per cent for May and of 63.7 per cent for June 1928. The volume of furniture and house furnishings sold during June by tw enty-six dealers and twenty-eight depart m ent stores in the district fell 21.7 per cent below the May aggregate, but continued, as in previous months this year since January, to total larger than in the correspond ing month of 1928, the gain averaging 7.9 per cent. In stallm ent sales by dealers declined 30.2 per cent in the m onthly comparison and were 6.6 per cent above a year ago. Stocks held on June 29 by both dealers and de partm ent stores averaged 1.9 per cent less than a m onth previous and were 0.6 per cent under those on the same date last year. Accounts receivable on dealers’ books the end of June declined 0.5 per cent from May 31 and aggre gated 4.5 per cent more than a year ago, while total col lections during the month were smaller by 5.6 and 1.9 per cent, respectively, in the m onthly and yearly compari sons; installm ent collections increased 1.2 per cent over May but declined 4.3 per cent from June 1928. M O NTH LY B U SIN E SS IN D IC E S COM PUTED BY F E D E R A L R ESER V E BA N K OF CHICAGO (I n d e x num bers express a com parison of u n it or dollar volum e for the m onth indicated, using the m onthly average for 1923-24-25 as a base, unless otherw ise indicated. W h ere figures for latest m onth show n are p a rtly estim ated on basis of re tu rn s received to date, revisions will be given the following m onth. D a ta refer to the S eventh Fed eral R eserve D istric t unless otherw ise n o te d .) No. of Tune F irm s 1929 M eat P ack in g — (U . S .)— Sales (in d o lla rs) ............................................ ... 59 120.0 C asting F o u n d ries— Shipm ents : Steel— In dollars ........................................... 15 101.4 I n to n s ............................................ ... 15 108.9 80.6 M alleable— In dollars ............................... .. 17 I n to n s ......................................... 15 117.3 Stoves and F u rn aces— 96.1 Shipm ents (in d o llars) ................................. ... 12 A g ricu ltu ral M achinery & E quip m en t— (U . S .)— D om estic Sales (in d o lla rs )........................ .. 83 244.4 E x p o rts (in d o lla rs) ...................................... .. 56 275.0 T o tal Sales (in d o lla rs )................................. .. 83 252.3 P roduction ........................................................ .. 82 175.2 F u rn itu re — O rders (in d o llars) ........................................ .. 27 103.6 99.5 Shipm ents (in d o llars) ............................... .. 27 E lectric E n erg y — O u tp u t of P la n ts (K W H ).......................... .. 8 147.4 In d u stria l Sales (K W H ) .......................... .. 8 199.4 F lour— 87.6 Production (in b b ls.) ................................. .. 32 O u tp u t of B u tte r B y Cream eries— Production ........ ............................................... .. 74 178.1 Sales ..................................................................... .. 74 143.4 Iro n a n d Steel— Pig Iro n P roduction 148.3 Illinois and In d ia n a ................................. 125.5 U n ited S tates ............................................... Steel In g o t P ro d u ctio n — (U . S . )1............. 146.5 Jnfilled orders U . S. Steel C orp............. 89.1 A utom obile P ro d u ctio n (U . S . ) : Passenger cars .................................................. 153.6 Trucks ................................................................. 258.3 Stam p T a x Collections— 2 Sales or T ran sfe rs of C apital S to c k ......... 332.9 Sales of Prod u ce on E xchange— F u tu res 75.4 U. S. P rim a ry M ark ets— 3 Drain R eceipts : O ats ................................................................. 40.8 97.1 C orn .................................................................. W h eat .............................................................. 76.2 Drain S h ip m e n ts: O ats .................................................................. 39.4 C orn ................................................................ 65.9 W h eat .............................................................* 54.5 M ay 1929 Ju n e 1928 M ay 1928 119.5 112.3 107.7 109.4 119.2 94.9 135.8 82.9 82.9 71.2 98.9 86.4 87.8 71.6 100.0 110.0 93.3 105.5 223.9 233 .6 225.5 182.5 222.5 202.7 219.3 142.6 186.2 188.3 186.6 146.0 114.9 100.0 73.6 79.0 101.9 85.7 154.7 207.0 137.7 169.9 139.3 167.9 90.3 92.0 100.2 162.3 127.8 170.7 132.5 145.2 120.1 148.1 128.0 146.5 90.1 122.1 104.6 108.1 76.2 129.3 107.9 116.9 71.6 175.1 245.2 120.9 113.7 127.3 141.3 339.9 81.8 202.5 134.3 300.7 134.4 50.9 53.2 53.9 34.0 86.0 44.9 69.5 108.6 74.2 43.6 72.9 67.5 38.1 88.6 44.5 74.7 107.8 81.1 M ay June M ay 19 2 9 19 2 8 1928 99.6 1 07 .9 82 . 3 103. 5 10 0. 7 101. 5 9 7. 0 80.6 9 8. 3 99 .1 1 00 .0 10 1. 9 75. 2 1 07 .7 99.4 1 62 .4 100. 5 113. 8 95 . 9 1 14 .0 1 04 .7 1 75 .6 1 08 .8 11 9. 7 1 04 .0 11 8. 7 10 8. 5 14 3. 3 94.6 10 8. 5 96.0 11 1. 3 1 08 .7 15 6. 9 10 4. 5 1 17 .9 104. 5 11 6. 9 10 6 110 104 108 222 197 161 153 234 195 144 16 6 207 16 2 147 13 9 213 164 13 0 13 9 96.7 71.2 91.7 101.5 98.1 197.5 116.8 111.4 86.0 8'0.4 95.1 107.7 100.1 192.5 117.6 112.3 75.5 76.4 84.8 80.7 92.5 171.9 110.5 103.8 89.1 82.4 92.9 87.8 97.3 125.5 114.8 107.3 200.8 196.9 148.2 206.5 170.2 187.8 193.9 204.1 40.0 50.4 61.5 90.0 69.6 54.5 84.9 73.3 109.1 95.9 101.9 112.5 89.5 73.7 53.5 124.2 66.7 75.2 69.6 58.0 99.1 85.9 134.5 137.7 123.9 128.6 107.8 115.3 66.9 93.7 72.3 105.3 59.8 113.7 89.6 84.5 101.7 101.8 111.6 105.8 95.3 95.5 79.8 146.1 91.8 137.5 66.5 42.8 100.7 87.4 125.2 116.4 132.9 128.0 114.3 126.2 No. of June Firm s . 19 29 W holesale T rade— N et Sales (in do llars) : G roceries ............................................. ........... 37 1 00 .8 H ard w are ........................................... ........... 15 104. 1 D ry Goods ......................................... ........... 10 82 . 3 59.2 D ru g s .................................................... ........... 12 Shoes .................................................... ........... 8 93 . 3 R etail T rad e (D e p t. S to re s )— , N et Sales (in do llars) : Chicago .............................................. ........... 30 10 5. 3 ........... 4 In dianapolis ...................................... ........... 5 ........... 5 O utside .............................................. ........... 53 Seventh D istric t ............................. ........... 97 R etail T rade— (U . S .)— D epartm ent Stores ............................... ........... 5 2 7 C hain S to re s : G rocery ............................................... ........... 34 D ru g .................................................... ........... 13 Shoe ...................................................... ........... 7 Five a n d T en C ent........................... ........... 14 F reig h t C arloadings— (U . S .)— G rain and G rain P ro d u cts........... L ive Stock .......... Coal ........................ Coke ........................ F o rest P roducts ... O re .......................... M erchandise and M iscellaneous. T o tal .................... B uilding C onstruction— C ontracts aw arded[ (in d o lla rs) : R esidential ...... T o tal .................. P erm its : Chicago ............. .N um ber C ost...... Indianapolis ..... .N um ber C ost...... Des M oines ...... .N um ber C ost...... D etroit ................ .N um ber C ost...... M ilw aukee ........ .N um ber C ost___ O th ers (4 5 ) ..... .N um ber C ost...... F ifty Cities ...... .N um ber C ost...... *A verage daily production; 2F irst Illinois in tern al revenue d istric t; sM onthly average receipts 1923-24-25 = 100. Page 7 P R O D U C T IO N OF MANUFACTURES M IN E R A L S PERCENT AND mo iwr 120 Manufac tures $ / 'T . f f j j L __ ■ i u S M inerals eo 80 60 60 1925 1926 1927 1928 1929 I n d e x n u m b e r s o f p r o d u c tio n o f m a n u f a c t u r e s a n d m i n e r a l s c o m b in e d , a d j u s t e d f o r s e a s o n a l v a r i a t i o n s (1 9 2 3 -2 5 a v e r a g e = 1 0 0 ). L a t e s t fig u r e s , J u n e , 1929: M a n u f a c t u r e s , 127; M in e r a ls , 113. WHOLESALE (By the Federal Reserve Board.) TPU T O Umineral of m anufactures continued in large volume in June, while production declined. T here was a rise in the general level of commodity prices, reflecting chiefly an advance in agricultural com modities. P r o d u c t io n h * # < O NATIONAL SUMMARY OF BUSINESS CONDITIONS PERCENT P R IC E S Activity of m anufacturing establishm ents continued at a high rate in June. O utput of automobiles and of iron and steel showed a seasonal decline smaller than is usual from May to June. Silk mill activity in creased and there was a grow th in the daily average production of cement, leather, and shoes. Production of copper at smelters and refineries de creased sharply and output of cotton and wool textiles was also reduced, although production in all of these industries continued larger than in other recent years. The volume of factory employment and payrolls in June showed a small seasonal decline from May, but, as in earlier months, was substantially larger than in 1928. O utput of mines was generally smaller in June than in May, reflecting declines in the production of coal, copper, and other nonferrous metals. O utput of petroleum, however, in creased to new high levels. Reports for the first half of July indicate some further reduction in output of cotton textiles, iron and steel, lumber and coal. The volume of construction contracts awarded decreased further in June, and for the first half year, awards were 12 per cent less than in the same period of 1928, reflecting chiefly a substantial decline in residential building. D uring the first three weeks of July, contracts aw arded were larger than in the same period a year ago. A g r ic u l t u r e D epartm ent of A griculture estimates, based on July first crop condi tions report, indicate a w heat crop of 834,000,000 bushels, about 8 per cent smaller than production last year, but larger than average production in the preceding five years. The acreage of cotton in cultivation on July first was estim ated at 48,457,000 acres, 3 per cent more than a year ago. D is t r ib u t io n (1 9 2 6 = 1 0 0 ). L a t e s t fig u r e , J u n e , 1929: 96.4. MEMBER b a n k C R E D IT BILLIONS OF DOLLARS BILLIONS OF DOLLARS 10 D uring the m onth of June, freight carloadings were slightly smaller than in May, as a result of decreases in loadings of m ost classes of freight, except grain products and ores. In comparison with other recent years, however, loadings continued to show an increase. Sales of departm ent stores in June, as in earlier months, were larger than in the same m onth of 1928. P r ic e s M o n th ly a v e r a g e s o f w e e k ly f ig u r e s f o r r e p o r t i n g m e m b e r b a n k s in l e a d in g c itie s . L a t e s t fig u r e s , a v e r a g e s o f f ir s t t h r e e w e e k s in J u ly , 1929: L o a n s o n S e c u r itie s , 7,703 m illio n ; A ll O th e r L o a n s , 9,2 05 m illio n ; I n v e s t m e n t s , 5,535 m illio n . RESERVE B A N K C R E D IT A N D C IR C U L A T IO N MONEY IN fig u r e s , a v e r a g e s o f f i r s t 21 d a y s in J u ly , 1929: R e s e r v e B a n k C r e d it, 1,4 08 m illio n ; M o n e y in C ir c u la tio n , 4 ,7 8 2 m illio n . Page 8 W holesale prices, according to the Bureau of Labor Statistics index, advanced from May to June on the average som ew hat less than they had declined during the preceding month. Farm products, particu larly grains, cattle, beef, and hides, showed marked advances in price. Prices of mineral products and their m anufactures also averaged higher in June than in May, the rise reflecting largely increases in the price of petroleum and gasoline. Prices of leading imports, rubber, sugar, silk, and coffee, showed a decline for the m onth as a whole. D uring the first two weeks of July, w heat and corn continued to move sharply upward, while hides declined slightly in price. H og prices increased, and prices of rubber and tin, which began to advance in the middle of June, con tinued to rise. B ank C r e d it D uring the first half of July, the volume of credit extended by m em ber banks in leading cities declined somewhat, following a rapid increase in June. On July 17, loans and investm ents of these banks were about $400,000,000 above the level at the end of May. The increase reflected chiefly rapid grow th in loans to brokers and dealers in securities and also some further increase in commercial loans. The banks’ holdings of investm ents continued to decline and were on July 17 about $700,000,000 below the middle of last year. The total volume of reserve bank credit outstanding showed an increase of about $120,000,000 during the four weeks ending July 17, the increase being in discounts for m ember banks. Demand for additional reserve bank credit arose chiefly out of a considerable increase in the volume of money in circulation, which accompanied the issuance of the new smallsize currency. There was also some increase in reserve balances of member banks, accompanying the grow th in their loans and consequently in their deposits. O pen-m arket rates on 90-day bankers’ acceptances declined from 5j4 to 5% per cent between the latter part of June and the middle of July, while rates on prime commercial paper remained unchanged.
@FedFRASER