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THE BUSINESS REVIEW % THIRD FEDERAL PHILADELPHIA '--s’1 V ' . / RESERVE DISTRICT AUGUST i, 193 6 69,- By RICHARD L. AUSTIN, Chairman and Federal Reserve Agent FEDERAL RESERVE BANK of PHILADELPHIA Business and Banking Conditions in the United States Volume of production, employment, mobile factories there was less than the and trade was sustained in June at the seasonal decline. At textile mills em May level, although usually there is a ployment was unchanged, although a decline at this season. Wholesale decline is usual in June, while the prices of commodities advanced be clothing industries reported a decrease tween the middle of May and the third in the number employed. week of July, reflecting in part the Total value of construction contracts effects of the drought. awarded, as reported by the F. W. Production and employment. The Dodge Corporation, increased some Board’s seasonally adjusted index of what from May to June and continued industrial production increased from to be substantially larger than a year 101 per cent of the 1923-25 average in ago. There was a further increase in May to 105 per cent in June. Steel residential building. production continued at about 70 per cent of capacity in June and the first Agriculture. Crop estimates by the three weeks of July, although a con Department of Agriculture on the siderable decline is usual at this season. basis of July 1 conditions indicated Output of automobiles declined sea little change from last year for wheat sonally. The cut of lumber showed a and corn and considerable declines for seasonal rise in June following a oats, hay, potatoes, and tobacco. Since substantial increase in the preced July 1 prospects have been reduced by ing month. Production increased at extreme drought over wide areas. woolen mills and was sustained at cot Cotton area in cultivation on July 1 ton mills where a decline is usual in was estimated by the Department of Agriculture at 30,600,000 acres com June. Output of foods increased. Factory employment and payrolls pared with 27,900,000 acres last year showed a slight increase between the and an average of 41,400,000 acres in middle of May and the middle of June, the years 1928-1932. contrary to seasonal tendency. Steel Distribution. Freight car loadings mills and plants producing machinery increased seasonally in June and the employed more workers, and at auto distribution of commodities to con INDUSTRIAL PRODUCTION FACTORY EMPLOYMENT ». CENT 110 m. Mor •old Stock / Member Bank kZL TreocuryCosh '"•''-l H7f jU_ r. Credit Notional feenk 1934 1935 1936 Wednesday figures. July 22, 1936. 1 6 Otter Accounts ----------- —— ” 1936 1934 1935 1 H January 31, 1934, to WHOLESALE PRICES too 90 90 BO 80 70 70 60 60 50 50 1929 MEMBER BANK RESERVES AND RELATED ITEMS no 100 Index of physical volume of production, ad justed for seasonal variation. sumers was maintained at the May level. In recent months retail trade as measured by sales of automobiles and by the volume of business of depart ment, variety, and mail order stores has expanded considerably. Commodity prices. The general level of wholesale commodity prices, as measured by the index of the Bureau of Labor Statistics, advanced by about 3 per cent between the middle of May and the third week of July, following a decline of about the same amount earlier in the year. Prices of wheat, flour, feed grains, and dairy products advanced sharply, owing primarily to the drought, and there were increases also in the prices of hogs and pork, 1930 1931 1932 1933 1934 1935 1936 Index of number employed, adjusted for sea sonal variation. Index compiled by the United States Bureau of Labor Statistics. By months, 1929 to 1931; by weeks, 1932 to date. Latest figure is for week ending July 18, 1936. Page One cotton and cotton textiles, silk, rubber, copper, and finished steel. Bank credit. Gold imports, which had been in large volume in May and June, declined in July. Funds held by the Treasury as cash and on deposit with Federal Reserve banks declined, as the result of disbursements in connection with the cashing of veterans’ service bonds. Consequently reserve balances of member banks, which had declined in June, rose once more to their previ ous level. Total loans and investments of re porting member banks in leading cities, after increasing sharply at the end of May and the early part of June, declined somewhat in the four weeks ending July 15, reflecting largely a reduction in loans to security brokers and dealers in New York City. Bal ances held for domestic banks in creased by $800,000,000 during the period, as a consequence of redeposit with reporting banks of a considerable part of funds acquired by banks through Treasury disbursements. Business and Banking Conditions in the Philadelphia Federal Reserve District Industrial activity in the Philadel phia Federal Reserve District has been well sustained since April at the high est level since 1930. Industrial produc tion comprising output of factories, coal mines and oil fields has shown addi tional gains during June; this bank’s adjusted index rose to 86 as compared with 85 in May, 83 in April and 74 a year ago. Building operations con tinue seasonally active, although the value of contracts awarded and permits issued declined from May with the exception of public works and utilities. The condition of farm crops and livestock in this section apparently does not reflect the same severity of drought as in other parts of the coun try. Prices of farm products and foods have advanced during the month, and largely as a consequence of this rise total income from the sale of farm products, particularly dairy and poul try, has increased sharply, reaching lately the largest amount in several years with one exception. The value of retail and wholesale trade sales during June changed little seasonally but continued appreciably greater than a year ago. Early re ports for July also indicate that de mand at retail has been more active than last year. Inventories declined in the month but were somewhat larger than at the end of June last year. Sales of automobiles in June fell off sharply but were substan tially above a year ago. Life insur ance sales increased further. Business at commercial hotels showed large ex pansion during June, owing mainly to increased activity in Philadelphia. Freight and passenger traffic in this area also increased and the current level compares well with the usual seasonal estimates for this period with the exception of coal. Industrial employment and payrolls showed little change from the middle of May to the middle of June and con tinued noticeably larger than a year ago. Early reports from manufactur ing industries indicate that activity in July has been close to that of June, although usually marked declines occur at this time. Manufacturing. Demand for factory products on the whole has continued fairly active, although seasonal influ ences are apparent in certain lines of manufacturing. Sales of iron and steel products, including machinery and machine tools, structural materials, engines and pumps and electrical ap paratus, have increased and the vol ume of unfilled orders at present is larger than a year ago. Similarly, the demand for silk, cotton and wool manufactures has expanded somewhat since the middle of last month, as in dicated by forward commitments. Sales of other durable and non-durable prod ucts have continued larger than a year ago. Prices of manufactures, especially certain textile and metal products, chemicals and building materials, have advanced during the past month. The price index of the Bureau of Labor Statistics for all commodities except farm products and foods was 79.4 on July 18 as compared with 78.7 a month ago, 77.9 a year ago and 78.6 two 3-ears earlier. Inventories of finished goods at re porting plants for the most part show little change and, with a few excep tions, are smaller than last year. Stocks of most raw materials also ap pear to be considerably smaller than they were at this time last year. The number of wage earners em ployed in manufacturing and the BUILDING CONTRACTS-VALUE INDUSTRIAL AND TRADE ACTIVITY PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PUBLIC WORKS AND UTILITIES INDUSTRIAL PRODUCTION TOTAL RETAIL TRADE SALES 7. NON-RESIDENT RESIDENTIAL 1931 DigitizedPage for FRASER Two 1933 1934 1935 1936 1932 1933 1934 1936 amount of wage disbursements showed Business Indicators gains of about 2 per cent from the middle of May to the middle of June. Philadelphia Federal Reserve District Preliminary reports for July indicate that the June level was maintained de Index numbers: percentages of the 1923-1925 average i spite the usual seasonal decline. Com Adjusted for seasonal variation Not adjusted Adjusted indexes allow for the usual pared with June 1935 employment, seasonal change in activity. Per cent change payrolls and working time have con Unadjusted indexes reflect merely the tinued substantially larger. June 1936 1936 June Apr actual change which may or may not June Apr. May June from from 1935 [1936 May June be typical. 1935 1936 1936 1936 1936 1936 The June employment index number 6 Month Year mos. for Pennsylvania was 80.4, relative to ago ago- 1935 the 1923-25 average, or 7.3 per cent Industrial production................. 74 83 85 86p + 1 + 15 + 8 73 81 84 84p Manufacturing—-total..................... higher than a year ago. The payroll 69 81 83 84p + 2 + 21 + 10 69 79 81 83p Durable goods............................ 52 78 73 77p 1 + 28 + 50 index was almost 76, or 27 per cent Consumers’ goods...................... 83 87 87 89p + 3 + 8 + 1 Metal products............................ 86 58 82 84 + 3 + 49 + 25 59 80 84 87 higher than last year. Estimates indi Textile products.......................... 80 85 79 83p + 5 + 4 - 4 78 81 77 81p Transportation equipment.... 33 70 76 75 cate that all Pennsylvania factories - 1 + 127 + 63 73 79 34 75 Food products.............................. 73 74 78 81p + 3 + 11 + 7 69 73 76 77p about the middle of June this year Tobacco and products............... 89 98 100 88 -12 96 89 97 95 8 1 + Building materials...................... 31 38 45r 42p - 6 + 23 34 38 46 r 46p employed approximately 866,000 wage Chemicals and products............ 106 110 118 118p - 0 112 120 118p + 11 107 Leather and products................. 116 122 125 117p - 7 120 114 114p earners and paid out in wages a total - 41 114 Paper and printing...................... 83 84 85 86 + 1 + 85 82 85 86 Coal mining....................................... 95 64 69 of $19,439,000 a week. The average - 11 67p - 4 83 65 69 58p Anthracite..................................... 97 63 69 66p - 4 85 65 5 69 57p Bituminous................................... earnings of wage earners at reporting 79 73 73 73 + 1 69 66 65 65 Crude oil....................................” "' + 1 372 409 417 404 387 3 + 5 422 434 420 + plants were about $22.81 a week, or Electric power Output............................................ 203 r 229 228 229 13 + 12 193r 224 212 218 virtually the highest since 1930. +0 + Sales, totalt.................................. 193 215 214 218 + 2 + 13 + 13 187 222 205 212 Sales to industries^:..................... 146 158 160 156 Delaware factories reported a gain Employment - 3 + 6 + 13 148 160 163 157 and wages—Pa. of about 5 per cent in employment, Factory—-Wage earners.................. + 2* + 7* + 4* 75 79 79 80 Payrolls............................. 76 + 2* + 27 + 15* 60 73 74 payrolls and working time from May Man-hours (1927-28 = 100). ! ! + 2* + 34* + 21* 60 76 79 80 General (1932=100) to June. Compared with a year ago Employment................................. + 1* + 5* + 3* 108 112r 112 113 . Payrolls.......................................... employment was 5 per cent larger and Building - 0* + 17* + 12* 127 141 148 r 148 and real estate payrolls almost 16 per cent greater. Contracts awarded!—total........... +15 +172 +146 20 47 51 56 Residentialf.................................. + 9 + 117 +102 Reports from factories in southern 16 27 33 34 Non-residentialf.......................... +138 +146 26 55 60 62 1 Public works and utilities!. ... New Jersey also show gains in the +31 +404 +198 21 85 82 104 Permits for building—17 cities.. . . -36 + 76 +139 9 34 22 16 Mortgages recorded—Philadelphia month and as compared with last year, 7 5 8 Real estate deeds—-Philadelphia.. 35 49 44 although labor difficulties in that part Sheriff deeds (1930 =100). . . 109 48 100 Other deeds (1930 =100)___ 64 69 81 of the district necessarily affected the Writs for Sheriff sales—Phila.. , 676 525 558 27 765 709 551 558 32 + 6 Distribution current change. Retail trade —sales............... 75 79 78p - 1 + 11 + 10 69 79 81 77p Output of manufactures has con stocks........... 68 69 67p - 3 + 8 60 70 69 64p Wholesale trade—sales.............. 83 89 88p - 2 + 9 + 7 77 77 83 84p tinued gradually upward. On a sea .. . stocks............ 70 69 68p - 1 + 3 70 64 68 66p Life insurance sales........................... 88 94 sonally adjusted basis, this bank’s index 99 + 4 + 1 102 98 101 103 New passenger auto, registrations . 110 138 - 8 127 38 + 26 128 165 199 177 Hotels—Occupancy (1934=100) of productive activity in June rose to + 6* + 22* + 8* 106 129 121 128p . Income, total (1934 =100) +20* + 43* + 12* 102 135 121 145p 84 per cent of the 1923-25 average as Freight car loadings—total............. 69 66 70 1 + 8 + 10 62 Merchandise and miscellaneous 0 72 71 58 69 compared with 83 in May and 81 in + 22 + 12 Coal................................................... - 6 26 - 3 77 63 64 56 Business liquidations April; a year ago this index was 69. Number................................................ +15* 17* - 16* 92 66 66 76 Amount of liabilities................ ] ’ * ] The rate of manufacturing activity in +98* - 8* 35* 48 23 22 44 Payment of accounts the first half of this year has averaged Check payments................................ 77 80 81 84 83 77 79 + 1 + 1 + 7 Rate of collections (actual) about 10 per cent higher than in the Retail trade..................................... + 3 + 9 31 30 32 34 same period last year and in June was . Wholesale trade............................. 75 67 72 72 + 1 + 11 States the highest for that month since Prices—United Wholesale (1926 = 100)................. 0* 80 80 79 79 + 1* 1* + Farm products................................ 1930 when production was declining — 2* + 4* 78 78 77 75 0* Foods........................................'" ’ ' 2 * + 2* 4* 78 83 80 80 sharply. Other commodities........................ 0* + 1* + 2* 78 79 79 79 Retail food............................... ’ ’ ‘ + 4* + 2* 83 82 79 80 Activity of industries producing con Philadelphia......................... . ’ ’ ’ [ + 5* + 4* 83 82 82 86 Scranton.................................... + 4* + 1* sumers’ goods, particularly knit goods, 79 76 78 81 silk, wool and cotton manufactures, % change from June Mar. Apr. shoes, and some of the food products, May (In millions of dollars) June 1935 1936 1936 1936 Month Year 1936 showed a marked improvement from ago ago May to June. The group comprising Banking and credit Federal Reserve Bank the durable goods industries showed a Bills discounted.............................. t i S (a) $ (a) * (a) $ (a) Other bills and securities............. small decline, owing mainly to reces 178 183 183 183 184 +1 + 3 Member bank reserves................. 227 295 292 276 +22 276 sions in some of the transportation Reserve ratio (per cent)............... 67.3 73.4 74.1 73.1 73.5 +10 + 9 Reporting member banks equipment lines and in such building Loans to customers....................... $ 4X7 S 402 S 410 S 410 $ 413 +1 - 1 Other loans and investments. . . 670 745 757 763 materials as cement and brick, which 763 +14 Total (gross) deposits................... 1,266 1,382 1,389 1,371 1,374 +00 + 9 Bankers’ acceptances outstanding. more than offset gains in iron and 12.9 12.3 11.2 10.6 steel and their products. For the year * Computed from data unadjusted for seasonal variation. p—-Preliminary. r—Revised, T 3-month moving daily average centered at 3rd month, to date the output of durable goods t Not included in production index. (a) Less than $500,000. Page Three OUTPUT OF TEXTILE GOODS OUTPUT OF SHOES AND HOSIERY PHILADELPHIA FEDERAL RESERVE DISTRICT PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT SHOES .* WOOLENS AND WORSTEDS HOSIERY COTTON 1931 1932 1934 1933 was 28 per cent greater than in the same period last year. In consumers’ goods, the rate of production was but slightly higher than last year and in the case of the textile group factory activity averaged 4 per cent less. Output of electric power in June was maintained at about the same high level as in the preceding month. Total sales of electricity were similarly held and were 13 per cent larger in the first six months this year than last. Industrial consumption of electrical en ergy declined by a somewhat larger amount than usual from May to June but continued appreciably larger than a year ago. Coal and other fuels. After increas ing for two months, the output of anthracite as well as employment in this industry declined sharply during June, reflecting the usual summer dull ness in demand as evidenced by smaller shipments. In early July production slackened further. The supply of an thracite fuel held by producers, dis tributors and consumers appears to be considerably larger than it was last year, except for a decline in stocks at (Output and shipment June 1936 averages) Anthracite Production.................tons Shipments..................tons Stocks............... 1000 tons Prices........... (1926=100) Employment. ............No. Bituminous Production.................tons Shipments.......... No. cars Prices........... (1026=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 Month Year ago ago 152,200 — 17 146,495 — 21 853+ +131 77.0 + 1 91,862 7 -33 -32 +21 + 1 - 9 308,100 20,743 96.5 125,299 — 1 2 0 1 - 6 -11 + 0 113.8 93.7 + 2 0 +42 + 6 124.3* — 72.2 3 3 +21 +12 — — — - 7 Sources: Bureau of Mines and Bureau of Labor Statistics. * Estimated. t June 1. Page Four 1935 1936 1932 1933 1934 1935 1936 The largest gain during the month and over a year ago was in public works; contracts for non-residential build ings declined somewhat from May to June, though they continued larger than last year. There was also a de crease in contract awards for residen tial buildings during June but a marked increase over last year, particularly in the case of family houses. Operations on residential contracts accumulated over past months reached in June the highest level since early 1931. The table gives detailed comparisons. The volume of current operations, as indicated by employment, has increased further and is substantially larger than a year ago. The largest gain in em ployment and payrolls occurred in the construction and repair of streets and highways. Employment in the produc tion of building materials has increased steadily since February. The index of wage earners employed in seven indus tries of Pennsylvania producing impor tant building materials in June rose to about 68, relative to the 1923-25 aver age, or the highest level shown for any month since 1930. The depression low Per cent index number was around 39. dl£mge June Building contracts Prices of building materials have Philadelphia 1936 1936 From from (000’s Federal Reserve continued firm. omitted) month District 6 mos. ago 1935 Agriculture. The condition of farm crops in this district as of July 1 com -20 + 102 Residential........................ * 3,532 - 36 - 5 Apts, and hotels.......... 196 pared rather well with the average for -20 + 131 Family houses.............. 3,336 - 6 + 146 Non-residential................ 5,541 1928-32 but the indicated yield appears +49 + 112 Commercial................... 1.478 to be smaller this year than last in the - 3 - 14 489 Factories........................ -31 +793 Educational................... 2,381 case of grains, potatoes, and hay. Es + 56 All other......................... 1,193 +24 timated production of tobacco, on the -12 +128 Total buildings........ 9,073 +58 + 198 other hand, is larger than a year ago Public works and utilities 5,369 and is up to the average volume. +146 + 5 Grand total............... $14,442 There have been frequent rains in the Source: F. W. Dodge Corporation. past month but the benefits from them which was a substantial increase over a have been somewhat nullified by short year ago but was only about 55 per cent intervals of intense heat, particularly as compared with the 1923-25 average. in July, having an especially bad effect electric power plants. Prices have ad vanced slightly and are about 4 per cent higher than a year ago. Bituminous coal mined during June was in about the same volume as in the previous month but not as large as a year ago. The July level of produc tion has been about the same as that in May-June. Production for the year to date has been in approximately the same volume as in the first six months last year. Output of by-product coke has con tinued upward since April; usually production declines from May to June. For the six-month period, output was 25 per cent larger than in the same period last year. The employment and payroll indexes for June remained practically the same as in May. Pro duction of gas and fuel oils fell off somewhat in June after an upturn in the previous month. Output of these fuels was substantially larger in the first six months this year than last. Building. The value of contracts awarded for all types of construction during June totaled about $14,442,000, SALES OF FARM PRODUCTS - VALUE COST OF LIVING PHILADELPHIA PERCENT PERCENT PHILADELPHIA “ FED RES. DISTRICT CLOTHING 'OTAL UNITED STATES source! Bureau of Labor Statistics 1931 1932 1933 1934 on pastures and hay fields. The ac companying table compares the indi cated yield of certain crops as of July 1 with the volume harvested last year. Crop condition Philadelphia Federal Reserve District (000’s omitted) 1935 yield 1936 indicated yield Wheat..................................... Corn......................................... Oats.......................................... Potatoes, white..................... Hay, tame.............................. tons Tobacco................................. 19,083 54,140 16,699 24,888 2,412 28,488 16,564 45,897 14,645 21,208 1,777 31,850 Official reports indicate that the sup ply of grains held by farmers in this section on July 1 was noticeably larger than a year ago and as compared with the average for earlier years. Reserve supplies of dairy products in the coun try appear to be smaller than in other years; nor are the stocks of eggs large in comparison with records for other years, except in the case of frozen eggs. The estimated production of orchard fruits, particularly apples, seems to be substantially smaller than last year and as compared with the average. The number of acres planted to truck crops for commercial canning or man ufacture in this section has been rela tively large but no official figures on the growth of these crops are yet avail able ; naturally a prolonged drought would affect their condition adversely. The volume of milk produced per cow in this section, according to the report as of July 1, was about the same as a year ago but larger than the average from 1925 to 1934. Consump tion of milk has been increasing and prices have continued firm. Out put of dairy products has expanded steadily since early spring. This is also true of dressed poultry and poultry products. The amount of cash realized by farmers from the sale of their prod 1935 1936 ucts, particularly dairy and poultry products, has continued steadily up ward for four months, as indicated by the accompanying chart. This rise in part reflects higher prices. Distribution, trade and service. Dol lar sales by department, apparel, shoe and credit stores in this district during June were about 11 per cent larger than a year ago. The decline from May to June was 5 per cent, which is close to the usual seasonal rate of drop for this period. Sales by chain and mail-order stores in June were either sustained at the high level of May or increased further and were among the largest monthly sales in several years. Business in July appears to have con tinued larger than a year ago. In the first half of this year the value of retail trade sales by reporting stores was 10 per cent larger than in the same period last year, the most notice able increases occurring in wearing apparel and such household equipment as furniture and electrical appliances. All trading areas have shared in this gain, reflecting largely improved in dustrial conditions and consequent gain in income. Inventories at retail establishments were 7 per cent smaller at the end of June than a month before but 8 per cent larger than a year ago, reflecting in part higher prices for certain classes of merchandise. The rate of stock turnover this year has been 7 per cent higher than last year. The volume of accounts settled by customers in rela tion to receivables increased 3 per cent and was 9 per cent larger than a year ago. The value of wholesale trade sales in June was 9 per cent larger than a year ago. A slight increase from May to June was of smaller proportion than is usual for this period. Favorable changes in the sales of drugs, groceries and jewelry were somewhat more than offset by declines in shoes, dry goods, electrical supplies, hardware and paper. Aggregate sales in the first half of this year were 7 per cent larger than last year, reflecting higher prices and increased demand. The supply of merchandise at whole sale establishments declined during the month but was slightly larger than a year ago. The rate of stock turnover was 5 per cent greater this year than last. The ratio of collections during June to receivables at the beginning of that month was slightly higher than in May and about 11 per cent above that in June 1935. The sale of passenger automobiles during June declined rather sharply, following a new high record volume sold in May. The registration index of new passenger automobiles in this district dropped from about 138 in May to 127 in June. The number of new cars sold so far this year exceeds last year’s volume by 26 per cent. Buy ing of new and used automobiles on the installment plan has been increas ing at a very rapid rate both in the number of cars and in the amount of retail financing involved. The volume of freight car loadings in this section on the whole has changed little since early May, despite a rather sharp decline in the shipment of coal. The movement of merchan dise, chiefly manufactured goods, from the Philadelphia area was somewhat larger in June than in May and in early July continued close to the June level. For the year to date shipments of mer chandise and miscellaneous commodi ties were 12 per cent larger while load ings of coal were 3 per cent smaller than last year. Page Five Business at commercial hotels dur ing June increased substantially as compared with May and a year ago. This expansion, particularly in the revenue from all sources, reflects chiefly the activity of Philadelphia hotels, especially during the conven tion period. In fact the revenue of commercial hotels outside Philadelphia declined from May to June except for income from guest rooms. Employ ment and payrolls in all hotels, sea sonal as well as year-round, increased in June and continued larger than last year. Further details for commercial hotels follow: Hotel business Philadelphia Federal Reserve District June per cent change from Month Year ago ago - 0 Room occupancy.................... + 6 Per cent of capacity used: June 1936................. 59.4 May 1936................. 54.3 / June 1935.................. 49.3 Income from: Guest rooms......................... +27 Food..................................... Other sources....................... +28 Total revenue................... +20 + o +22 1936 from 6 1 mos. 1935 + 8 +46 +35 +56 +11 +12 + 12 +43 +12 Much interest has been manifested in the extent to which veterans have turned in ad justed service bonds for redemption. The following table, giving adjusted service checks charged against the Treasurer’s account at this bank, re veals a pronounced slowing down in the rate at which bonds have been presented. Banking conditions. (000’s omitted) Week of June 24.. . July 1... July 8.. . July 15... July 22... . . . . . Total.... Bond redemp tions Frac tional amounts Totals $ 35 30,639 23,443 6,274 3,149 2,378 $1,228 2,336 385 168 96 69 $ 1,263 32,975 23,828 6,442 3,245 2,447 $65,918 $4,282 $70,200 As noted last month some banks evidently accumulated currency in an ticipation of the cashing of adjusted service checks even before the bonds were issued. From June 17 to July 4 there was a further rise of 15j4 mil lions in currency demand, some part of which was due to the usual holiday needs; last year in the same period the rise was only 6% millions. From July 4 to July 22 the net return flow was 10^2 millions this year, as compared with 7$4 millions in 1935. Over the five weeks ending July 22 the excess of Treasury disbursements over local receipts reached the large total of 88 millions. The funds so pro Page Six vided by the Government were much more than sufficient to offset an ad verse balance of payments of 23 mil lions in commercial and financial transactions with other districts and an increase in currency demand, with the result that member bank reserve deposits increased from 260 to 319*4 millions, or 93 millions higher than a year ago. In the first twenty-two days of July member bank reserve deposits aver aged 316)4 millions. Member bank reserves averaged 268 millions in the last half of June and then were 119 millions or 79 per cent in excess of legal requirements. Federal Reserve Bank of Philadelphia (Dollar figures in millions) Total bills and securities......... Federal res. note circulation. . . . Member bank reserve deposits. . . U. S. Treasurer —• general account . Foreign bank deposits.................... Other deposits........ Total reserves......... Reserve ratio.......... $216.8 One year 9 24 -* i + 6 -$ 4 + 12 147 — 2 - 5 22 63 2 181 - 1 1 + 2 + 1 8 1 2 448 +$ 3 322 - 1 + 31 105 313 + - 2 2 + 29 + 40 $1,188 +$ 2 +$95 225 15 155 87 + 47 8 1 + 76 + 2 + 2 - 2 763 276 +$18 + 9 +$80 + 5 71 318 - 1 + 34 + 37 + 40 21 221 - + One year -$ 0.2 + 0.0 - 0.0 -$ 0.3 - 0.1 + 1.5 + 34.0 + 34.0 Other loans.......................... +$35.1 297.1 + 5.7 + 61.4 319.5 + 59.5 + 93.1 19.7 - 38.5 + 18.1 5.6 1.6 449.6 69.9% Five weeks Five weeks +$33.8 - 0.1 1.9 7.2 3.9% Chans;es in July 22, 1936 Reporting member banks (000,000’s omitted) Assets Loans to brokers and dealers: In New York City.......... » Outside New York City. Loans on securities to others (except banks).. . Acceptances and commercial paper bought........... Loans on real estate.......... Changes in— July 22, 1936 Bills discounted. . . $ 0.2 Bills bought............ 0.3 Industrial advances 5.1 United States securities............. 211.2 pal source. The outstanding credit of these banks showed little change and balances with correspondents increased only 8 millions, the bulk of the funds being reflected in a rise of 47 millions in reserves at the reserve bank. Loans to customers on securities in creased from 167 to 171 millions, owing to a rise of 6 millions in those made to brokers and dealers outside of New York. The so-called commer cial (all other) loans touched a high for the year at 185 millions on July 1, Total loans....................... $ U. S. Government securities...................................... Obligations fully guaranteed by U. S. Gov’t. . . . Other securities................... -$ 5 Total loans and invest- + 3.0 - 0.2 +140.7 + 3.9% The reserve bank’s holdings of United States securities increased from 177 to 211 millions. This did not involve any local extension of credit, as it represented only an in creased participation in the Federal Reserve System’s holdings of such se curities, which continued to approxi mate 2,430 millions. In the same period of five weeks deposits of the reporting member banks increased from 1,368 to 1,428 millions. While the greater part of this growth took the immediate form of an expansion in balances held for other banks, it appears probable that payments to veterans were the princi Reserve with Fed. Res. Bank................................... Balances with other banks Other assets—-net............... Liabilities Demand deposits, adjusted................................. S Time deposits...................... IJ. S. Government deposits.................................. Interbank deposits............. Other liabilities................... + - 1 3 5 but subsequently receded to 181 millions, a point only 2 millions above five weeks or a year earlier. De clines of one or two millions each were recorded in loans on real estate, in holdings of open market paper, and in investments. Comparison of the latest figures with those of a year ago reveals an in crease of 168 millions in deposits. MEMBER BANK RESERVES AND RELATED FACTORS Changes in weeks ending—• June 24 July 1 July 8 July 15 July 22 Changes in five weeks Sources of funds: Reserve bank credit extended in district.... Commercial transfers (chiefly interdistrict).. Treasury operations.............................................. - 1.9 - 7.9 +32.5 - 0.5 -10.0 +26.4 - 0.1 + 15.5 +13.8 + 2.0 - 4.8 + 7.3 - 2.0 -15.9 + 7.9 - 2.5 -23.1 +87.9 Philadelphia Federal Reserve District (In millions of dollars) Total..................................................................... +22.7 +15.9 +29.2 + 4.5 -10.0 +62.3 Uses of funds: Currency demand................................................. Member bank reserve deposits.......................... “Other deposits” at reserve bank.................... Unexpended capital funds of reserve bank... + 11.4 +13.3 - 2.0 + 0.0 + 2.7 +12.8 + 0.6 - 0.2 - 2.5 +31.8 - 0.2 + 0.1 + - + 4.6 5.3 0.2 0.1 + 4.8 +59.5 - 1.9 - 0.1 Total..................................................................... +22.7 +15.9 +29.2 + 4.5 -10.0 +62.3 2.2 6.9 0.1 0.1 Although 40 millions of the increase was in balances held for other banks, the reporting banks on their part did not change materially their own balances with correspondents. The influx of funds was reflected in a 100 million rise in security holdings, of which only 31 millions was in direct obligations of the United States, and in the addition of 76 millions to reserves at the Federal Reserve Bank. Employment and Payrolls in Pennsylvania (All figures are rounded from original data) Manufacturing Indexes Employment* (Indexes are percentages of the 1923-25 average taken as 100. Total and group indexes are weight ed proportionate^.) REPORTING MEMBER BANKS PHILADELPHIA FEDERAL RESERVE DISTRICT MILLIONS Per cent Per cent June change from June change from 1936 1936 index June May index June May 1935 1936 1935 1936 All manufacturing......... Iron, steel and products . Non-ferrous metal prods. Transportation equip... . Textiles and clothing.. . . Textiles........................... Clothing....................... Food products................... Stone, clay and glass. .. . Lumber products............. Chemicals and products. Leather and products. . . Paper and printing.......... Printing.......................... Others: Cigars and tobacco___ Rubber tires, goods. .. Musical instruments. . DEPOSITS 1000 TOTAL LOANS AND INVESTMENTS. Employehours t Payrolls* 80 73 115 60 96 92 115 101 79 62 84 89 92 87 65 81 51 * Figures from 2308 plants. + 7 +15 + 14 +21 + 3 + 1 + 8 - 2 + 3 + 9 - 3 - 3 + 2 +i +2 +3 +3 +0 +0 +1 -0 -0 +6 -2 +3 +0 +1 + 4 - 2 + 6 + 6 June ’36— per cent change from June Mav 1935 1936 76 79 121 55 78 75 92 96 68 52 79 75 87 85 +27 +50 +28 +47 + 7 + 8 + 5 + 5 +17 +22 + 6 - 2 + 6 + 5 + + + + + + + 2 +34 4 +51 3 +39 3 +58 1 + 9 0 + 9 4 + 8 + 3 + 4 - 2 +14 +11 +24 - 1 + 7 + 5 + o - 1 + 7 - 1 + 3 + + +1 55 + 3 +1 0 84 42 +45 +13 - 0 + 4 +15 — l + 3 +15 + 5 +40 +23 + + + + + + + — + - 2 3 2 2 2 2 5 l 4 6 3 6 1 1 f Figures from 2064 plants. INVESTMENTS General Index Numbers Covering twelve branches of trade and industry LOANS (Indexes are percentages of the 1932 average taken as 100. In dividual indexes are combined proportionately into general in dex number.) BALANCES AT RESERVE BANK AND OTHER BANKS 1934 General index (weighted)___ 1935 193 6 Percentage change—June 1936 from June 1935 City areas* Manufa cturing Employ ment Wage payments Allentown............. Altoona.................. Harrisburg............ Johnstown............ Lancaster.............. Philadelphia......... Reading................ Scranton............... Trenton................. Wilkes-Barre.... Williamsport.... Wilmington.......... York....................... 4-10 + 8 + 6 +17 + 7 + 5 + 8 + 4 + 2 - 2 + 4 + 8 - 5 +32 +46 +24 +70 + 9 +10 +23 +14 + 15 + 2 +14 +20 + 3 Allentown............. Altoona.................. Harrisburg............ Johnstown............ Lancaster.............. Philadelphia......... Reading................ Scranton ............... Trenton................. Wilkes-Barre.... + + + + + + + + + + + + + + + + + - Building permits (value) Debits +106 + 60 - 47 +551 +336 + 55 +147 +326 +225 +433 +179 +272 - 16 +12 +35 +17 +62 +16 + 4 +16 + 3 +15 +17 +25 +35 +23 Wilmington.......... 3 4 3 2 2 4 0 1 2 + 5 + + + + 3 3 2 5 5 +109 - 30 + 43 - 40 +132 - 57 +190 +213 + 34 +420 + 27 +110 +139 +10 + 9 +19 + 0 +10 + 1 + 8 +35 + 8 + 6 +45 + 6 + 3 +17 + 7 +66 + 8 + 7 - 2 - 1 - 1 + 4 113 127 83 118 79 114 165 91 116 111 108 100 108 June 1935 May 1936 + 5 + 7 - 9 - 7 +15 + 2 -22 + 3 + 4 + 6 + 2 + 3 + 7 +1 +1 - 7 - 1 June 1936 index + 2 + 1 -18 + 1 + 2 + 0 + 1 + 1 - 1 Per cent change from June 1935 May 1936 +17 +27 -36 — 11 +45 +37 + o + 8 + 8 + 8 + 8 +10 + 3 - 0 + 2 -25 - 3 — 2 + 1 -15 - 0 + 2 - 0 + 2 + o -10 148 185 78 178 93 201 170 98 119 107 112 108 125 INDUSTRIAL EMPLOYMENT AND PAYROLLS PENNSYLVANIA * lg MANUFACTURING AND NON-MANUTACTURING INDUSTRIES AND SERVICES PERCENT + 7 ~ PAYROLLS -10 -19 -14 - 8 -18 - 0 -18 -15 + 6 -14 EMPLOYMENT + 5 1932 * Area not restricted to the corporate limits of cities given here. June 1936 index Payrolls Per cent change from Retail trade sales June 1936 from May 1936 1 2 1 4 1 1 1 6 2 1 1 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.................. Employment 1934 1935 1936 Page Seven OUTPUT OF MANUFACTURES Index numbers of individual lines of trade and manufacture Philadelphia Federal Reserve District Index numbers: percentages of the 1923-1925 average as 100 Not adjusted Adjusted for seasonal variation seasonal change in activity. Per cent change Unadjusted indexes reflect merely the actual change which may or may not June Apr. May June be typical. 1935 1936^1936 1936 June 1936 from June Apr. May June 1935 1936 1936 1936 Month Year ago ago 1936 from 6 mos. 1935 +10 + 9 +15 +11 + o +25 69 66 71 83 81 65 79 70 67 115 | 91 87 81 74 67 99 96 89 77p 71p 75 85 83 87 60 50 64 78 63 67 70 56 69 95 75 84 69 54 71 98 73 82 64p 51p 67' 88 66 78 Retail trade Sales Total of all stores.......................... Department................................. Men’s apparel............................. Women’s apparel....................... Shoe............................................... Credit............................................ 71 69 66 86 68 69 75 70 65 93 78 86 79 76 70 96 81 84 78p 74p 70 87 70 92 - 1 - 2 - 0 - 9 -14 + 9 + ii + 7 + 5 + 2 + 3 + 33 63 68 53 66 89 72 84 69 55 71 97 70 85 67 p 53p 71 98 68 81 — — + - + + Stocks of goods 87 64 69 3 3 0 l 4 5 8 1 + 13 + 17 Rate of stock turnover + 7* ... . 2.09 1 .95 Wholesale trade Sales Total of all lines............................. 80 Boots and shoes......................... 55 Drugs............................................ 91 Dry goods.................................... 37 Electrical supplies..................... 101 Groceries...................................... 108r Hardware..................................... 50 Jewelry......................................... 44 Paper............................................. 67 Stocks of goods 83 89 88p 55 70 59 93 95 98 46 48 44p 94 132 108p 108 10/1 r 117 57 57 55p 51 49r 54 74 76 72p - 2 -15 + 3 - 9 -19 + 9 - 3 +10 - 6 + 9 + 8 + 8 + 17 + 7 + 9 + 11 + 22 + 7 66 70 69 68p IS 28 23 20 112 114 107 116 38 37 42 41 101 118 116 114p 68 72 70 70 67 80 79 77p 61 54 53 62 64 63p 61 - 1 — 14 + 8 - 3 — 2 — 3 — 2 — 3 — 2 + 3 + 9 + 4 — 12 + 13 - 0 + 15 + 8 + 3 Rate of stock turnover Output of manufactures Pig iron................................................. Steel....................................................... Iron castings........................................ Steel castings....................................... Electrical apparatus.......................... Motor vehicles.................................... Automobile parts and bodies.......... Locomotives and cars....................... Shipbuilding......................................... Silk manufactures.............................. Woolen and worsteds........................ Cotton products................................. Carpets and rugs................................ Hosiery.................................................. Underwear............................................ Cement.................................................. Brick...................................................... Lumber and products........................ 32 51 53 51 77 9 39 18 79 74 81 41 132 105 114 43 33 23 43 75 56 101 103 9 57 30 224 88 69 48 118 108 146 54 42 27 46 77 71 93 103 12 62 32 242 80 r 72 46 126 98 140 59 47 35r 53 82 85 93 99 12 60 32 240 87 77 50 123 105 149 56p 45 32 +15 + 6 +20 - 0 - 3 + 8 - 3 - 2 - 1 + 8 + 8 + 7 - 3 + 7 + 6 - 5 - 5 + 8 + 3* 85 96 + 13 -16 88 74 67 69p + 4 99 87 -12 69 68 - 2 88 90 +1 123 133 + 8 127 lOlp -20 78 76 - 2 82 r 87 + 5 157 152p - 3 108 114 + 6 * Computed from data unadjusted for seasonal variation. 64 17 105 42 99 63 69 53 61 + 5* Slaughtering, meat packing............ RS 83 Sugar refining...................................... 39 95 Canning and preserving................... 60 59 Cigars.................................................... 89 97 Paper and wood pulp........................ 61 67 Printing and publishing................... 87 87 Shoes...................................................... 128 129 Leather, goat and kid....................... 105 115 Explosives............................................ 78 75 Paints and varnishes......................... 78 80 Petroleum products........................... 140 144 Coke, by-product............................... 80 103 Page Eight + 7 77 + 11 47 + 8 87 + 11 34 +13 83 + 1 llOr + 12 52 + 6 37 +12 64 +71 + 66 +32 + 61 +32 + 60 +69 + 82 + 29 +n + 33 +22 + 53 +46 + 78 +50 +204 +78 - 7 + 18 — 5 + 3 + 22 +18 - 7 +10 -12 + 0 + 30 +14 + 29 +16 + 37 +34 +28 + 38 - 0* + 3* +13 + 41 + 87 +34 + 9 + 15 + 9 - 1 + 10 + 9 + 3 + 3 - 2 + 4 + 2 - 4 - 2 '+ 8 +12 + ii + 8 + 8 + 42 +25 77 83 84 p 58 69 51 94 95 95 40 45 40p 87 100 88p 99 106 r 119 58 63 58p 33 41r 45 74 75 69p 70 68 66p 28 22 19 116 108 109 38 37 41 115 111 lllp 68 68 63 79p 84 81 59 58 57 62 64 63p 2.86 2.72 30 52 52 53 77 11 39 18 78 70 78 39 126 103 114 52 34 24 90 65 42 43 96 61 86 122 106 78 80 141 80 p—Preliminary. 49 79 58 103 90 11 62 32 229 86 63 49 110 108 143 53 44 26 86 82 124 50 89 68 89 129 112 76 84 144 107 48 50 81 84 73 84 97 96 95 99 15 15 65 60 32 33 249 237 77 r 82 67 74 46 47 122 117 98 103 142 149 67 67p 50 47 32 r 32 88 90 85 91 108 79 51 50p 96 95 69 67 89 89 112 126 116 102p 79 76 87 r 88 158 152p 112 114 r—Revised. WOOLENS AND WORSTEDS
@FedFRASER