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IjaA ^ THE BUSINESS REVIEW THIRD FEDERAL PHILADELPHIA RESERVE DISTRICT AUGUST i, 1935 By RICHARD L. AUSTIN, Chairman and Federal Reserve Agent FEDERAL RESERVE BANK of PHILADELPHIA Business and Banking Conditions in the United States Factory production declined season ally in June, while output of mines increased. Employment and payrolls at factories showed more than seasonal declines. There was little change in the average level of wholesale prices, and a decrease in retail food prices. Production and employment. Daily average output at factories, according to the Federal Reserve Board’s pro duction index, declined by about the usual seasonal amount during Jane. Output of mines increased, and the Board’s combined index of industrial production, which is adjusted for usual seasonal changes, advanced from 85 per cent of the 1923-1925 average in May to 86 per cent in June. Daily average output of automobiles and lumber in creased in June, while activity at cotton mills, shoe factories, and meat-packing establishments declined. Activity at steel mills declined seasonally during June, but, according to trade reports increased after the first week of July. There were sharp increases in the pro duction of anthracite and bituminous coal during June and output of crude petroleum was also larger than in May. Factory employment and payrolls de creased between the middle of May and the middle of June. More than seasonal declines in employment were reported by producers of automobiles, clothing, shoes and cotton fabrics, and employ ment at lumber mills also decreased, while the number of workers at woolen mills increased. In most other manu facturing industries changes in employ ment from May to June were largely seasonal in character. Employment and payrolls at mines increased consid erably. Daily average construction contracts awarded, according to reports of the F. W. Dodge Corporation, were larger in value in June, and the first half of July than in May. Awards of residen tial building contracts were twice as large as a year ago, while contracts for public projects continued smaller than last year. The Department of Agriculture July 1 estimates forecast corn and wheat crops larger than a year ago, but smaller than the five-year average for 1928-1932. Acreage of cotton in cul tivation on July 1 was reported as about 5 per cent larger than at the same time last year. Distribution. Daily average loadings of freight on railroads increased during June, reflecting larger shipments of coal. Daily average value of depart ment store sales showed little change from May to June, when a decline is usual, and the Board’s seasonally ad justed index advanced from 76 per cent of the 1923-1925 average to 80 per cent. Commodity prices. Wholesale prices of farm products and foods declined during June, while the prices of other commodities as a group showed little change. Retail prices of food, which had increased sharply in the two years INDUSTRIAL PRODUCTION CONSTRUCTION CONTRACTS AWARDED MEMBER BANK CREDIT Index of industrial production, adjusted for seasonal variation. (1923-1925 average = 100.) Three-month moving averages of F. W. Dodge data for 37 Eastern States, adjusted for seasonal variation. Latest figures based on data for April and May and estimate for June. WHOLESALE PRICES Indexes of the United States Bureau of Labor Statistics. (1926 = 100.) By months 1929 to 1931; by weeks 1932 to date. Wednesday figures for reporting member banks in 91 leading cities. Latest figures are for July 17. Page One ending last April, according to the in dex of the Bureau of Labor Statistics, declined somewhat in May and June. Bank credit. Member bank reserve balances with the Federal reserve banks and excess reserves showed declines for the four weeks ending July 17, re flecting in large measure an increase in the balance of the Treasury with the Federal reserve banks, following a sale of Treasury notes. Total loans and investments of re porting banks in leading cities in creased by $260,000,000 during the five week period ended July 17. Sub scriptions by reporting banks to new security offerings by the Treasury ex ceeded retirement of bonds held by these banks, and consequently their holdings of direct obligations of the United States increased by $200,000, 000. Holdings of other securities in creased by $125,000,000, while loans declined by $60,000,000. Government deposits with these banks were reduced by over $200,000,000, while other de posits, exclusive of inter-bank balances, showed an increase of a similar amount. Yields on Government securities de clined slightly during this period, while other short term open market money rates remained at low levels. Business and Banking Conditions in the Philadelphia Federal Reserve District Industrial activity in the Philadelphia Federal Reserve District generally has declined further, after increasing for three months ended in April. Output of manufactures and crude oil during June fell off by a larger volume than usual while production of coal showed an exceptional increase over the May volume. The June output of these three industries combined was still larger than a year ago, and the rate of productive activity continued about 4 per cent higher in the first half of this year than last and was the highest for that period since 1931. Some improve ment also was evident in the activity of building and construction, though the present level continues very low compared with that prevailing in the years prior to 1931. Retail trade sales in June showed a considerable improvement over May and in July the dollar volume compared well with a year ago. Trading at wholesale in general failed to maintain the normal seasonal rate of activity. The market for new passenger auto mobiles showed noticeable improvement in June, after declining in May from the three-year peak reached in April; for the year to date about one-third more new units have been sold than in the same period last year. There has been some gain in railroad freight car loadings, mainly because of greatly in creased shipments of coal, but the movement of manufactures from this district has shown little change since early June. General employment and earnings of workers in the principal branches of trade and industry in this section in creased slightly from the middle of May to the middle of June, according to reports from 10,265 establishments employing in June about 783,000 work ers whose average weekly earnings ap proximated $17,500,000. Early re ports for July indicate about the usual seasonal declines in the case of manu facturing. Compared with the average for 1932, which was a record low' year, the June index of general employment was 8 per cent higher and that of in come from w'ages and salaries 27 per cent higher. Manufacturing. The market for manufactures shows additional slack ening as it usually does at this season. Sales have fallen off since the middle of last month, except in the case of wool and silk manufactures and some of the metal products. Compared with a year ago, the volume of business has been well maintained and in’the case of cotton, wool, clothing, shoes, chemi cals, brick, lumber, plumbing supplies and certain fabricated metals sales have continued larger. The volume of unfilled orders for finished products generally about the middle of July seemed to have exceeded that at the same time last year by a fair margin. Stocks of finished goods at factories have not shown much change during the month, and with but a few excep tions they are smaller than a year ago. Nor has there been any material change during the month in the case of raw materials, except for some increases in the inventories of wool fibers and yarns, leather, pottery and slate. The supply of raw materials held by the plants in this section appears to be smaller than a year ago; stocks of such important textile fibers as silk and wool, for example, seemed consider ably smaller on June 30 this year than a year before. Factory prices of finished products have shown little change during the month, following some advances in such textiles as wool and silk manu- SALES OF FARM PRODUCTS-VALUE INDUSTRIAL AND TRADE ACTIVITY PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT PHILADELPHIA “ FED RES. DISTRICT RETAIL TRADE SALES OUTPUT OF FACTORIES AND MINES UNITED STATES - - - - -VALUE OF — BUILDING CONTRACTS Page Two 1933 1934 1935 1936 1931 1933 1934 1935 1936 factures and fibers in early June. But the range of fluctuations on the whole has been negligible. The price index, compiled by the Bureau of Labor Sta tistics for all manufactures including fuel and lighting materials, on July 20 was 77.9 per cent of the 1926 average or the same as a month ago and com pared with 78.6 a year ago. The number of wage earners in Pennsylvania manufacturing industries showed a decline of nearly 1 per cent and the amount of wage payments al most 3 per cent from the middle of May to the middle of June. The volume of work done during the payroll period nearest to the middle of June, as measured by the number of hours actually worked by all wage earners, decreased in about the same propor tion as did payrolls. The extent of these recessions is about usual at this time. The June level of factory em ployment was a trifle higher than the low and 2 per cent lower than the high point reached this year. A somewhat similar comparison is found in the figures on payrolls and working time. July declines appear to be no larger than is to be seasonally expected. Average weekly earnings in June amounted to about $19.25 as compared with $19.72 in May and $19.71 in June 1934. Hourly earnings showed a slight drop from the previous month but were virtually unchanged from a year ago. The number of hours actually worked by a wage earner averaged 33.2 a week as against 33.9 a month ago and 34.4 a year before. The index of factory employment, representing 68 important industries in Pennsylvania, in June was 75 per cent of the 1923-25 average, or about 1 per cent lower than a year ago. The pay roll index was about 60, or 3 per cent r below that in June 1934. Since March last year the range of fluctuation has narrowed down greatly. For example, the proportion that the low level has been to the high level in the past 16 months approximates 95 per cent in employment and 82 per cent in payrolls. These ratios were much higher than in the previous comparable period. Output of factory products in this district during June declined from the May volume by a larger proportion than usual, following a rise for three months from February to April. Rela tive to the 1923-25 average as a base, this bank’s preliminary index of pro ductive activity, which is adjusted for the number of working days and sea sonal variation, was 69 as compared with 73 in May, 74 in April, and 70 in June last year. The rate of factory pro Business Indicators Philadelphia Federal Reserve District Index numbers: percentages of the 1923-1925 average taken as 100 (All figures are rounded from original data) Adjusted indexes allow seasonal change which an uneven distribution of business between the months of the year. Adjusted for seasonal variation Percentage com parison Unadjusted indexes reflect merely the actual change which may or may not be up to the usual seasonal expecta June Apr. May June tions. 1934 1935 1935 1935 June with Month Year ago ago Industrial production.................... Manufacturing—total....................... Metal products............................... Textile products............................. Transportation equipment.......... Food products................................. Tobacco and products.................. Building materials......................... Chemicals and products.............. Leather and products................... Paper and printing........................ Electric power output.................. Industrial use of electricity........ Coal mining......................................... Anthracite....................................... Bituminous...................................... Employment and wages—Pa. 101 111 80 197 135 69 69 66 72 73 57 66 65 85 44 70 94 27 92 42 69 93 27 95 134 81 197 136 67 69 52 86 102 129 82 200 134 70 71 62 Writs for Sheriff sales—Phila......... Distribution Retail trade— sales............................ Wholesale trade—sales..................... Life insurance sales........................... New passenger auto, registrations. Freight car loadings—total............. Mdse, and misc.............................. Coal................................................... Business liquidations 72 72 71 71 70p 68p 64 87 44 65 81 46 68 68 108 79 188 137 60 60 58 85 27 96 132 82 193 138 69 72 47 91 28 104 117 83 186 137 69 71 56 61 77p 35 66p 96 30 107p 120p 82 188 148 83p 85p 69p 76 62 65 76 63 62 76 62 62 75 60 60 108 127 - 2 - 5 — 9 — 4 - 8 - 7 -24 - 2 - 5 + 2 + 5 - 5 + i — 1 + 9 +36 +37 +27 71p 69p 52p 82p 60 79p 34 69p 89 27 107p 123p 83 198 146 95p 97p 79p + 2 — 1 — 10 + 3 - 7 +13 -29 -13 - 1 -13 + 6 +11 + 4 + 0 + S +38 +41 +19 _ i* — 1* — 3* — 3* - 3* _ 7* Emplove-hours (1927-28=1001. . . General—12 occupations: Payrolls (1932=100).................... Building and real estate Contracts awarded—total!............. Residential!..................................... Non-residentialf............................ Public works and utilities!......... Permits for building—17 cities... . M or tgages recorded—Philadel ph ia. Real estate deeds—Philadelphia . . June Apr. Mav June 1935 1934 1935 1935 1935 with 6 mos. 1934 + 1* — 2* - 1* 110 107 107 + 3* + 0* + 4* 126 124 123 70 70 58 79 65 70 48 79 90 31 74 74 57 90 Not adjusted 17 13 23 26 30 12 21 97 6 8 6 7 44 37 17 13 24 13 7 5 41 18 13 69 62 81 68 100 79 57 58 58 63 62 67 -39 0 - 8 18 7 5 40 764 801 928 69 62 83 71 93 94 + 7 22 +ii +41 + 4 -11 - 2 0* — 3* -18 765 + 3 -81 57 56 63 56 68 88 +30 102 -12 -13 + 2 + 3* + 8* + 3* -36 - 6 - 8 -67 34 14 25 + 0 40 89 63 764 +10 + 2 20 20 20 15 25 25 9 17 27 15 16 26 8 8 5 43 44 117 109 60 66 841 974 74 67 63 62 77 78 66 71 69 + 3 104 105 94 +34 111 142 123 + 9* 96 121 113 +10* + 8* 92 125 115 + 0 — 2 63 55 58 - 9 - 3 64 59 59 +32 +1 58 53 62 2 60p — 3 0 81p - 3 70p + o 3 +n 98 - 3 92 + 16 — 5* + 12* — 11* + 9 - 0 68 48 75 97 34 -27 +10 + 7 +22* + 1* + 3* +13* 62 83 70 85 65 -23 -12 rip 88 69 110 10 6 66 + 7 68 + 4 + 5 + 6 + 6 +ii +16 + 1 — 7 - 2 - 7 - 1 - 1 + 0 + 1 + 5 + — + + 3 67 59 77 + 0 + 6 21 9 5 44 109 64 765 69p 77p 68p 102 128 107 102 62 58 77 +12* +23* +22* —42* — 44* 74 80 48 60 41 90 46 74 78 74 83 30 73 29 73 31 74 30 70 +51* 68 Payment of accounts Check payments................................. Rate of collections (actual) 71 77 75 80 + 7 +12 29 70 29 75 30 73 29 67 — 5* — 9* + 0* _ 4* + 7 Prices—United States — — + 0* + 7* + 8* 75 80 80 +24* +30* 63 80 81 +19* +24* 70 84 84 — 0* _ j* 78 77 78 +13* +14* 109 125 124 _ i* + 7* + 8* 118 128 1127 + 1* +10* + 8* 115 124 125 3* 2* 1* - 1* Scranton........................................... (000,000’s omitted in dollar figures) June 1934 Mar. 1935 Apr. 1935 9 8 $ May 1935 June 1935 8 $ 80 781 83 78 123 126 125 Per cent change from Month ago Year ago Banking and credit Federal Reserve Bank Bills discounted.............................. Other bills and securities............. Member bank reserves................. Ratio................................................. Reporting member banks Loans to customers....................... Other loans and investments. . . Net deposits.................................... Bankers’ acceptances outstanding. 8 1 171 i 171 i 222 68.8% 221 68.8% 68.5% 178 227 67.4% $460 574 1041 14.5 8418 667 1123 13.2 8413 665 1124 12.5 *416 664 1130 12.5 $417 670 1139 12.9 * Computed from data unadjusted for seasonal variation. ! 3-month moving daily average centered at 3rd month. 171 1 167 206 68.0% 221 0 +4 +3 -87 + 7 +10 -2 - 1 +0 +1 +1 - 9 +17 + 9 +3 -11 p—Preliminary. Page Three VALUE OF RESIDENTIAL BUILDING CONTRACTS INDUSTRIAL FUEL AND POWER PHILADELPHIA FEDERAL RESERVE DISTRICT PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT ELECTRIC POWER USED BY INDUSTRIES APARTMENTS AND —— HOTELS- - - - - ONE AND TWO FAMILY DWELLINGS FUEL OIL OUTPUT .TOTAL BITUMINOUS COAL ~ OUTPUT 1931 1932 1933 1934 duction in the first six months of this year averaged S per cent higher than in the same period last year. The decline in the output of the dur able goods industries in June was some what more pronounced than that in consumers’ manufactures, owing partly to curtailed operation of ship building through prolonged labor dif ficulties and partly to lessened activity of steel works and rolling mills, elec trical apparatus plants, and establish ments producing chiefly locomotives and cars. Nevertheless, latest reports seem to indicate that there exists at present well sustained or more active forward demand for certain heavy products including tools and ma chinery from such industries as auto motive, railroads, farm equipment and manufacturing. Marked increases in the output of woolens and worsteds, and carpets and rugs during June were not sufficient to offset sharp declines in production of knit goods and silk manufactures. In the case of the food group only baker ies and canning plants reported gains, while meat packing and sugar refining fell off substantially from the previous month. Output of shoes and leather was less active than usual in June, though the current level of production continued well above the base period. Activity at petroleum refineries and paint and varnish plants showed larger gains than usual from May to June. This is also true of paper and wood pulp, and brick establishments, while output of cement, lumber, explosives, coke and cigars failed to maintain their customary levels. Output of electric power in this dis trict on the whole changed little and continued slightly above the level of a year ago. Total sales of electricity for Page Four 1935 1936 1930 all purposes increased and in the case of industries, which constitute the largest class of consumers, purchases of electrical energy in June were 9 per cent above the usual seasonal quantity and they exceeded last year’s consumption by 6 per cent, comparing on the half-yearly basis. Coal and other fuels. Production and shipments of anthracite increased greatly in June, contrary to the usual downward tendency. Output and ship ments have been increasing since March, although preliminary figures for July indicate slackening in anthra cite activity. Stocks in producers’ yards increased SS per cent by the first of June, after declining for six months ; retailers’ supplies also showed a gain for the second month. (Output and shipment figures are daily averages) Anthracite Production........... tons Shipments............. tons Stocks.......... 1000 tons Prices.. . .(1926=100) Employment.........No. Bituminous Production........... tons Shipments. . .No. cars Prices.. . . (1926= 100) Employment.........No. Coke Prod. . (1923-25=100) Prices... . (1926= 100) Gas and fuel oil Prod.. (1923-25= 100) Prices... . (1926= 100) Per cent change from June 1935 225,700 216,833 705,000f 74.0 97,585 Month Year ago ago + 19 +20 +55 + i + 6 +40 +46 -39 — 4 — 1 329,200 23,210 96.1 134,278 +24 +18 + 0 + 6 +19 80.1 88.7 - 4 0 -13 + 4 109.5* 64.4f + 5 + 3 + 2 + 3 +20 + i + 4 Sources: Bureau of Mines and Bureau of Labor Statistics. ♦Estimated, t May. Output of bituminous coal continued upward in June, being 24 per cent larger than in May, instead of showing the usual slight decline; shipments also increased substantially. Figures for July reflect a falling off in production. 1931 1932 1933 1934 1935 Owing in part to labor difficulties, rail roads and industries have purchased a considerable amount of coal for stor age but industrial consumption has de clined coincident with a lower rate of industrial activity in June. As usual, output of by-product coke declined-4 per cent in June. For the year to date, production was 2 per cent smaller than last year. Production of gas and fuel oils has increased in the past two months, though for the first half of the year, it was .5 per cent below the same interval last year. Building and real estate. The value of all building contracts awarded in this district during June totaled $5, 946,800, a gain of 14 per cent over May but a decrease of 21 per cent as compared with a year ago. In con trast with an active period from 1923 to 1929, when the June volume aver aged about $35,495,000, this year’s amount of contracts let for various projects both in June and in the first six months has continued small. The most pronounced increase from May to June occurred in the awards of contracts for those projects which ap parently involved public financing. The largest relative declines during the month were shown in the case of fac tories and certain types of residences. On the basis of the three-month mov ing average centered at the third month, as described in this bulletin for July this year, the trend of contract awards for family houses has been upward during the past four months, as shown by the chart on page 4. This rise ap pears to reflect the influence of im proved renting demand and sustained industrial conditions generally. Operations on contracts previously awarded for private and public projects RATIO OF STOCKS TO SALES SALES OF NEW PASSENGER AUTOMOBILES PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT REGISTRATIONS PERCENT DEPARTMENT STORES UNITED STATES - PHILADELPHIA 4- - - - FEDERAL RESERVE DISTRICT l • ‘women’s ^APPAREL STORES 1933 934 expanded further in June. The num ber of workers and the amount of their earnings have increased almost steadily since the spring, though in June the volume of both seemed smaller than a year ago. Prices of building materials have continued to fluctuate narrowly around 85 per cent of the 1926 average. The real estate market has been quiet, though some activity in renting demand was apparent in earlier months. The number of real estate foreclosures in this section, while declining in June, has continued heavy relative to other more prosperous years. For example, in Pennsylvania the number of real estate foreclosures during the first five months of this year seems to have ex ceeded the volume in the same period of 1926 by about 325 per cent. Agriculture. Farming operations have progressed rapidly since the middle of last month. The greater part of the wheat crop has been harvested and threshing is well under way. Growing conditions generally have been favor able, excepting in scattered sections of northern and central Pennsylvania, where some fields were flooded by the excessive rains. Department of Agriculture estimates of July 1 indicate that yields of wheat, oats, hay and tobacco will be larger this year than last, while those of corn and potatoes will be smaller. This year’s harvest of orchard fruits promises to be substantially larger than 1934 and, in the case of apples, larger than the average yields. Demand for farm labor has increased by a larger percentage between April and July this year than last; the trend of farm wage rates also was more sharply upward than a year ago. The income of farmers has in 1930 creased sharply thus far this year, as indicated by the chart on page 2. The high peaks in the curve for this dis trict are attributable partly to an un usually large sale of potatoes. The in crease in income this year, as in the fall of the past two years, reflects for the most part higher prices, and rental and benefit payments. For example, whole sale prices of farm products on July 20 were about 17 per cent higher than a year ago. It is reported, moreover, that Pennsylvania farmers in the year ended June 1, 1935 collected $1,676,409 in the form of benefits under the crop con trol program. The tobacco growers re ceived the largest share, Lancaster County alone being credited with $837,379. Distribution, trade and service. Freight car loadings increased 9 per cent more than usual from May to June owing to an exceptionally large gain in coal shipments. The volume of rail freight originating in the Philadelphia industrial area showed practically no change from May to June and was somewhat larger than that of a year earlier; in the first two weeks of July shipments declined. The total dollar sales of eight whole sale lines decreased 3 per cent from May to June after allowance is made for the customary seasonal change. Improvement in sales of jewelry, hard ware, paper and drugs was offset by lessened activity in the sales of shoes, dry goods, electrical supplies and groceries. Comparisons with last year continue favorable, owing in part to higher prices. Early reports for July indicate seasonal slackening in sales. Retail trade sales of department, ap parel, shoe and credit (largely furni ture) stores combined increased 7 per 1931 1932 1933 1934 1935 cent from May to June, after making allowance for the number of trading days and the usual seasonal changes. In early July demand for general mer chandise slackened somewhat but com pared rather well with a year ago. Our seasonally adjusted index was 71 in June, relative to the 1923-25 average, compared with 66 in May and 69 a year ago. Dollar sales in the first half of this year showed virtually no change as compared with a year earlier. The accompanying chart shows the proportionate value of stocks that the department and women’s apparel stores carry in relation to their total value of sales. As is to be expected, these ratios disclose a considerable degree of sea sonal fluctuation, but they fail to indi cate any unusual change in the custom of the stores represented in these ratios with respect to carrying inven tories, although some decline has been apparent since 1932 in the case of de partment stores. That the level of the ratios in the case of department stores is considerably higher than that of women’s apparel stores is accounted for chiefly by the fact that the department stores carry a larger proportion of slow-moving stocks, as in the case of staples, than do the apparel specialty shops. The number of new passenger auto mobiles sold in June increased, con trary to seasonal tendency, so that the rate of activity indicated an improve ment of 8 per cent over May. Since last February sales have exceeded those in the same month of the past four years, the number of units sold in the first half this year being 34 per cent larger than in 1934 and the largest of any like period since 1930. Commercial hotels in this district re port a further decline in room oc Page Five cupancy and in income from all sources. This downward tendency is seasonal, reflecting slackened business activity. Summer resort hotels are not repre sented in the data below. June 1935 from Philadelphia Federal Reserve District 1935 6 mos. May June 1934— % 1935— 1934— % % — 0 - 5 - 0 +12 + 9 - 6 -17 -15 +10 +11 + 8 + 8 Other sources.................. + 9 +11 Total revenue............. — 11 +10 + 8 Room occupancy................ Per cent of capacity used: June 1935............. 49.3 May 1935............. 50.3 June 1934............. 43.2 Revenue from: Guest rooms.................... (000,000’s omitted) Loans on securities: To brokers and dealers in N. Y. City.............. * To brokers and dealers elsewhere...................... To others.......................... July 17, 1935 Changes in. Four weeks One year Changes in Federal Reserve 13 -$ 2 — #15 12 0 154 — 4 - 5 - 31 Total loans on securities $ Acceptances and commercial paper......................... Loans on real estate........... Other loans.......................... 179 -$ 6 — $51 25 70 181 — + 0 1 Total loans................. $ U. S. Government obligations................................... Obligations fully guaranteed by U. S. Gov’t.... Other securities................... 455 -$ 2 292 + 2 75 275 + + 7 Philadelphia (Dollar figures in millions) Total loans and investments................ *1,097 Net demand deposits........ 841 Time deposits...................... 281 United States deposits.... 34 Due from banks.................. 148 Due to banks....................... 259 Reserve with Federal Reserve Bank...................... 160 + 1+ 9 1 5 — $41 + 5 2 +1 9 + 15 + 6 — 8 — 11 + 1 +$52 +165 - 33 - 39 - 20 + 13 + + 18 4 July 17, 1935 Four weeks — *0.2 — 0.0 + 0.2 Total bills and securities............... $181.6 Fed. res. note circulation...................... 238.7 Fed. res. bank note 0 circulation—net. . Member bank reserve deposits.... 237.5 U. S. Treasurer —• general account . . 3.9 Foreign bank depos2.6 its............................. Other deposits.......... 1 .7 Total reserves........... 325.2 67.1% Reserve ratio............. —$ 6.3 - 0.1 + 3.7 0 0 Bills discounted.... $ 0.3 Bills bought.............. 0.5 Industrial advances. 3.7 United States securities........................ 177.1 0 Other securities........ One year + 10.0 - 0.4 -*0.0 +* 6.9 + 3.8 — 10.6 0 - 4.3 + 4.4 + 18.5 - 6.9 + — — - + 7.0 6.4 0.5% 0.2 2.6 2.1 8.8 3.9 1.4% MEMBER BANK RESERVES AND RELATED FACTORS Philadelphia Federal Reserve District Changes in weeks ending(In millions of dollars) Nonmember deposits at reserve bank.......... Unexpended capital funds of reserve bank . July 17 + 1.0 + 4.6 + 0.6 - 0.1 - 0.3 - 2.9 -0.2 —9.0 +0.1 - 0.7 + 5.2 + 1.6 - 3.3 -9.1 + 6.1 -0.1 + 1.9 +11.6 - 7.3 + 0.0 + 7.1 — 19.3 + 9.4 - 0.5 -4.2 -2.4 —2.6 +0.1 - 1.9 +14.5 - 6.5 - 0.0 +2.9 +4.4 -7.0 -0.4 + 6.2 Uses of funds July 10 + 6.2 Sources of funds Reserve bank credit extended in district. . . Commercial transfers (chiefly interdistrict) July 3 - 3.3 — 9.1 + 6.1 -0.1 1 June 26 l Changes in four weeks C f l« Page Six Reporting member ties to customers and 2 millions in loans to the open market were accom panied by a rise of 4 millions in other loans to customers, which are thought to be more typical of local credit granted to finance the current opera tions of industry. This latter class of loans, totaling 251 millions on July 17, was at the highest point since October and slightly greater than a year ago; the rise of 16 millions since the 1935 low on April 24 contrasts with a small decline in the same period of 1934. In the past four weeks investments of the reporting banks have increased 11 mil lions, owing mainly to the acquisition of 7 millions of obligations fully guar anteed by the Government. The upward trend of reserve bal ances of member banks so far this year has been accompanied by a rise in deposits, hence in required reserves, so that in June the average excess above requirements of 91millions was much the same as in January. The excess in June was nearly 68 per cent. 000 + Banking conditions. Treasury dis bursements, partly for relief and the redemption of securities, reached sub stantial amounts in this district dur ing the four weeks ending July 17. Government receipts, however, includ ing 27 millions withdrawn from de positary banks and cash payments for new securities, were a little in excess of disbursements. Treasury operations therefore had relatively little influence on the level of member bank reserve deposits. Commercial payments to and from other districts also were nearly in balance. The chief factor tending to raise reserves of member banks was a decline of 7 millions in miscellaneous deposits at this bank, re flecting mainly the payment of officers’ checks issued by the bank in connection with Federal relief. While a part of the funds so provided was absorbed by a rise in currency demand, member bank reserves increased over 4 millions. Variations in reserve deposits were marked, high and low points of 244 and 216 millions being reached within the four weeks; the closing figure on July 17 was 237 millions. Borrowings of member banks con tinued of negligible proportions in this period and additional industrial advances of over quarter a million dollars were partly balanced by repay ments, so that there was little net change in the amount of reserve bank credit extended locally. There was a sharp increase in the total of loans and commitments approved by the bank to provide working capital for industry; from $9,533,000 on June 19 there was a rise of $15,558,000 on July 17. Relatively slight changes have taken place in reserve bank credit over the past year and increasing interest has been manifested in member bank re serves as a result of the growth of ex cess reserves. Reserve balances reflect early the impact of a demand for funds as well as the initial effect of an inflow of funds. Accordingly the title of the table heretofore headed “Reserve bank credit and the factors that affect it” has been changed to read “Member bank reserves and related factors”. Although total deposits of the re porting member banks have declined a little in the past several weeks, net de posits show an increase owing to a re duction in amounts due from banks and in collection items, which may be used as deductions in figuring net deposits. Reserves with the reserve bank in creased somewhat and there also was an expansion of 9 millions in the out standing credit of these banks. De clines of 4 millions in loans on securi Note: This table gh'es, in balance sheet form, a summary of the banking changes which have had an in fluence on member bank reserve deposits. Employment and Payrolls in Pennsylvania LOANS TO CUSTOMERS REPORTING MEMBER BANKS PHILA. FED. RES DISTRICT MILLIONS (All figures are rounded from original data) Manufacturing Indexes SECURED BY — STOCKS AND BONDS Employment* (Indexes are percentages of the 1923-25 average Per cent Per cent taken as 100. Total and group indexes are weighted June change from June change from proportionately.) 1935 1935 index index June May June May 1934 1935 1934 1935 ALL OTHER 1933 All manufacturing....... Iron, steel and products . Non-ferrous metal prods. Transportation equip. . . Textiles and clothing. . . Textiles........................... Clothing.......................... Food products................... Stone, clay and glass.... TiUmber products.............. Chemicals and products . Leather and products___ Paper and printing.......... Printing.......................... Others: Cigars and tobacco.... Rubber tires, goods. . . Musical instruments .. 1935 CURRENCY DEMAND MILLION Employehoursf Payrolls* PHILADELPHIA FEDERAL RESERVE DISTRICT s 75 - 1 +1 + 2 + 8 — 1 - 1 - 0 - 1 60 53 93 37 74 71 89 91 58 43 74 75 82 80 + + + 67 — 2 + 4 76 -12 — 2 48 — 0 -n 53 58 37 * Figures from 2264 plants. + 50 June May 1934 1935 - 3 + 7 -16 — 7 - 1 — 12 63 - 3 + 7 +50 — 10 94 + 2 90 + 2 108 + 2 103 + 2 77 + 7 57 + 5 86 — 4 92 + 3 90 — 0 84 — 1 100 — 1 - 1 June 1935 per cent change from +1 - 0 - 3 - 3 - 6 - 3 -11 +12 -10 + 3 + 1 +14 + 3 +18 +11 6 3 6 6 - 3 7 — 3 — 6 -13 — 6 + 0 +13 + 1 + 2 ‘23 - 0 - 5 b 9 — 2 -10 — 2 — 5 - 8 b 6 - 6 + 2 b 1 + 2 + 2 - bll + 5 +13 - -17 +12 — 0 7 — 0 - 3 3 - 3 — 2 + 4 + o - 3 + 3 — 1 -23 + 2 -13 — 7 0 -13 f Figures from 2051 plants. General Index Numbers Y V Covering twelve branches of trade and industry V/wa/\^~J Employment '50 *■ (Indexes are percentages of the 1932 average taken as 100. In dividual indexes are combined proportionately into general in dex number.) June 1935 index JAN. I> 1932 = 0 -100 1932 1934 1933 General index (weighted)___ Manufacturing Employ ment Allentown............. Altoona.................. Harrisburg............ Johnstown............ Lancaster.............. Philadelphia......... Reading................. Scranton................ Trenton................. Wilkes-Barre.... Wilmington.......... York....................... Wage payments - 6 -14 — 0 — 14 + 9 + 6 + 6 — 4 — 6 — 1 + 9 - 8 + 2 -11 -17 - 7 -18 +12 + + + 9 5 i 0 + 18 - 6 +12 Building permits (value) - 65 — 38 +924 - 53 - 44 - 24 +106 — 51 - 70 ' - 37 + 13 + 40 + o June 1934 May 1935 June 1935 index Per cent change from June 1934 May 1935 + o - 3 +24 + 3 — 3 1935 Percentage change—June 1935 from June 1934 City areas* Per cent change from Payrolls Debits — + + 1 5 5 6 +21 +15 + 7 + 1 - 7 -16 +17 + 8 +11 Retail trade sales — 1 + 7 + 0 — 3 +1 + 3 — 2 + 3 +15 — 4 - 2 Manufacturing............................. Anthracite mining....................... Bituminous coal mining............. Building and construction......... Quarrying and non-met. mining Crude petroleum producing .. . Public utilities.............................. Retail trade................................... Wholesale trade........................... Hotels.............................................. Laundries....................................... Dyeing and cleaning................... 108 118 91 127 68 111 212 89 111 104 105 97 101 — 2 — 1 — 1 + 4 -19 -13 + 9 — 1 - 0 + 1 — 2 — 1 - 8 +1 -1 +6 +6 +7 +0 +0 +0 +2 +0 -0 +1 +4 127 145 123 200 +22 64 147 169 91 - 9 -17 - 3 + 2 + o + 2 + 2 + 2 +1 110 99 104 99 121 +33 +44 + 8 + 3 + 1 + 0 + 2 + 1 — 2 + 3 In INDUSTRIAL EMPLOYMENT AND PAYROLLS PENNSYLVANIA 12 MANUFACTURING AND NON-MANUFACTURING INDUSTRIES AND SERVICES PERCENT PAYROLLS June 1935 from May 1935 Allentown............. Altoona.................. Harrisburg............ Johnstown............. Lancaster.............. Philadelphia......... Reading................. Scranton................ Trenton................. Wilkes-Barre. . . . Wilmington.......... - 3 +1 - 2 + 0 + 1 + 0 — 0 + 3 “ 1 — 0 + 2 + 2 + 3 + + + + + + + + 6 1 3 3 0 1 3 2 0 2 3 3 4 — 11 - 57 +136 +145 — 57 + 19 — 18 — 61 - 49 — 15 + 24 +176 + 5 - 2 + 4 - 2 + 5 + 7 - 2 +1 -17 + 3 + 8 +19 + 1 * Area not restricted to the corporate limits of cities given here. + + — + + 6 0 5 EMPLOYMENT 8 9 6 6 +27 + 5 +13 1932 1933 1935 Page Seven Index numbers of individual lines of trade and manufacture OUTPUT OF MANUFACTURES PHILADELPHIA FEDERAL RESERVE DISTRICT ADJUSTCD TOR SEASONAL VARIATION 1W3-»SAWL-lOO PERCENT STEEL Philadelphia Federal Reserve District 50 Index numbers: percentages of the 1923-1925 average taken as 100 (All figures are rounded from original data) Not adjusted Adjusted for seasonal variation Adjusted indexes allow for the usual uneven distribution of business be tween the months of the year. LOCOMOTIVES AND CARS 50 Percentage com parison Unadj usted indexes reflect merely the actual change which may or may not be up to the usual seasonal expecta June Apr. May June 1934 1935 1935 1935 tions. June 1935 with Month Year ago ago J _________ 25 June Apr. May June 1935 1934 1935 1935 1935 with 6 mos. 1934 SILK 150 . 125 100 75 Retail trade Total of all stores........................... Department................................. Men’s apparel............................. Women’s apparel........................ Credit............................................ 69 67 66 86 72 65 Stocks of goods 69 65 58 92 78 72 66 62 53 60 84 58 72 62 54 64 56 84 71 67 71p + 7 + 69p + 8 + 67 p +21 + 87 + 5 + 71 - 0 — 68p + 1 + 3 + 3 — 2 + 1 + 2 — 5 + — 3 52p — 3 + 66p + 1 _ 87 — 0 — 3 _ 66p — 6 0 0 2 1 2 2 3 67 64 68 84 83 61 74 65 62 116 92 74 67 63 52 63 62 53 64 90 59 72 66 88 86 79 71 69p 66p 70p 85 81 64p WOOLENS AND WORSTEDS 75 A 50 HOSIERY 62 62 87 56 68 66 87 56 71 _ Rate of stock turnover Wholesale trade Sales Total of all lines.............................. 81 83 Boots and shoes.......................... 55 54 Drugs............................................ 88 87 Dry goods..................................... 42 39 Electrical supplies...................... 108 79 Groceries....................................... 105 124 Hardware..................................... 48 49 Jewelry.......................................... 40 50 Paper............................................. 65 69 Stocks of goods 68 71 17 22 Drugs............................................ 121 111 47 44 83 108 80 83 61 47 54 59 60 59 52 59 78 4 7 0 4 3 66 + 4* 70 22 108 43 106 81 66 50 62 58p 50p 63p 78 53 64p 1.97 77 57 88 34 73 114 50 33 69 77p 47 87 37p 82p 112 HOp 53 52 33 37 65 64p 78 59 87 38 81 66 71 69 68p 16 114 47 82 73 62 52 59 7 Op + o + 3 18 — 17 + 7 8 112 + 3 42p — 1 — 9 101* + 21 83 + 3 + 3 67 + 2 + 10 49 — 3 + 3 61 — 1 + 4 22 112 21 17 105 42p 99 76 69 53 61 109 44 42 105 100 83 77 69 68 53 51 60 61 125 A 100 L / V/\ 75 50 CEMENT 75 50 •s ./A 25 _ 1 _____ LUMBER PRODUCTS 75 50 25 PAPER AND WOOD PULP 75 50 2* 2.89 2.84 25 175 150 +12 - 7 +10 +16 -12 +12 8 — 21 + 20 — — 26 + 17 + 19 + 23 — 28 — 47 — 26 +104 + 9 +156 + 3 — 1 +16 — 13 -42 - 9 + 3 — 1 + 9 - 8 - 9 - 4 — 11 +19 — 14 “ 1 — 13 + 4* __ 0* 68 -10 — 27 39 -52 — 55 OOp + 3 — 12 89 - 5 — 1 63 + 4 + 5 87 + 1 + 4 + 3 - 6 128 118p - 3 + 20 - 1 — 12 78 68 + 6 — 4 146p + 4 + 15 13 + 0 8U — 26 0 1 6 33 66 — + 44 71 — + 33 72 + 3 13 — 19 32 + 8 26 + 10 147 — 9 89 + 69 36 + 1 35 +110 48 + 11 100 + 25 115 — 4 59 — 5 35 — 13 20 + 0* 91 19 88 — 30 93 — 4 49 2 — 96 + 4 60 0 — 83 + 1 118 3 99 8 — 89 6 — 72 + 2 128 2 92 23 57 46 44 87 16 37 22 30 58 50 45 88 14 35 21 125 140 86 73 63 70 43 41 112 114 119 114 131 126 44 51 31 26 15 16 86 87 74 76 116 100 47 45 84 91 63 61 86 87 148 124 116 110 66 80 67 68 128 140 82 83 30 52 52 53 84 15 39 19 78 66 74 39 122 103 114 52 30 17 90 65 42 43p 96 62 86 122 119p 78 70 147p 80 125 100 75 A A A/ Vi r LEATHER - GOA 125 lOO 75 p—Preliminary. -A J AND KID K r A /-v zvz / /vV * M 50 PETROLEUM REFINING 175 LZZ 150 125 \r\f \AMw 100 75 CIGARS 125 lOO 75 50 1932 * Computed from data unadjusted for seasonal variation. Page Eight r\J tv SHOES + Output of manufactures Pig iron.................................................. 35 20 28 32 Steel....................................................... 64 54 55 51 Iron eastings........................................ 44 44 48 53 Steel castings....................................... 68 44 44 51 Electrical apparatus.......................... 72 100 96 84 Motor vehicles..................................... 11 13 11 13 Automobile parts and bodies........... 32 34 34 39 Locomotives and cars........................ 25 21 21 18 Shipbuilding......................................... 148 122 136 79 Silk manufactures............................... 94 88 76 69 W oolen and worsteds......................... 38 69 75 77 Cotton products.................................. 37 41 41 41 Carpets and rugs................................. 50 119 118 128 Hosiery.................................................. 102 119 114 105 Underwear............................................ 115 133 125 114 Cement.................................................. 49 44 45 43 Brick....................................................... 33 29 24 29 Lumber and products........................ 20 16 17 17 Slaughtering, meat packing............. 93 75 75 Sugar refining....................................... 87 89 82 Canning and preserving.................... 69 55 59 Cigars.................................................... 89 92 94 Paper and wood pulp....................................... 60 62 61 Printing and publishing................................ 84 85 86 Shoes....................................................................................... 124 148 137 Leather, goat and kid....................................... 98 120 121 Explosives........................................................................ 89 65 79 Paints and varnishes.......................................... 71 64 65 Petroleum products............................................. 127 128 140 Coke, by-product................................ 92 79 80 57 69 1 89 83 81p — 3 + 0 + 6 77 59 55 — 8 — 0 + 0 47 87 91 + 4 + 4 + 1 84 5 — 4 39 40 40p — 1 107 lOOp — 6 — 7 + 8 89 113 108p — 5 + 3 + 8 107 48 50 + 5 + 5 + 7 50 39 44 +13 + 10 + 13 34 66 67p + 1 + 2 + 5 63 Rate of stock turnover j J \ 25 1933 1934 1 1935
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