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THE BUSINESS REVIEW THIRD FEDERAL PHILADELPHIA * RESERVE DISTRICT JULY i, 1930 By R IC H A R D L . AUSTIN, Chairman and Federal Reserve Agent FEDERAL RESERVE BANK of PHILADELPHIA Business and Financial Conditions in the United States The volume o f industrial produc tion declined in May by about the same amount as it increased in April. Factory employment decreased more than is usual at this season and the downward movement o f prices con tinued. Money rates eased further to the lowest level in more than five years. Industrial production and employ ment. The Board’s Index o f indus trial production, adjusted for usual seasonal variations, declined about 2 per cent in May. In 1930 industrial production has fluctuated between 4 and 7 per cent above the 1923-1925 average and the preliminary estimate for May is 4 per cent above the av erage for those years. Production at steel and automobile plants declined, cotton mills curtailed output, and ac tivity at woolen and silk mills con tinued at low levels. Cement produc tion increased sharply, while output o f petroleum and o f copper showed little change. In the first half o f June, output at steel plants declined further. The decrease in factory employ ment in May was larger than usual and there was also a decline in fac- Index n u m b e r o f p ro d u ction of m a n u fa c tu re s and m in era ls co m b in e d , a d ju ste d for seasonal variations (1923-1925 average = 1 0 0 ). L a te st igure M a y , 104. tory payrolls. The number employed in the cotton and silk goods industries decreased further, while in the woolen goods industry there was an increase from the extreme low point o f April. Employment in the agricultural im plement and electrical machinery in dustries decreased from April but re mained large relative to earlier years. Employment in the cement industry increased, but in the lumber industry continued at an unusually low level. Building contract awards in May, as reported by the F. W . Dodge Cor poration, continued to be in substan tially smaller volume than in any other year since 1924. Distribution. Freight car loadings increased by less than the usual sea sonal amount during May and con tinued to be in somewhat smaller volume than in the corresponding period o f 1928 and substantially below the unusually active period o f 1929. Department store sales in May were approximately the same as those o f a year ago. Wholesale prices. A further decline in the wholesale prices o f commodi- Index of U n ited S tates B ureau of L abor S ta tistics (1 9 2 6 = 1 0 0 , base adopted by B u rea u ). L a te st figure M a y , 89.1. ties occurred in May and the first half o f June. The downward move ment was interrupted in the last half o f May by substantial increases in the prices o f grains, meats, and live stock, but became pronounced about the middle o f June when the prices o f cotton, silk, rubber, copper, and silver reached exceptionally low levels. Wheat, meats, livestock, and cotton textiles also declined in price at that time, while prices o f wool and woolen goods, pig iron and steel showed little change. 1926 1927 1928 1929 1930 M o n th ly averages o f w eekly figures for rep o rt in g m e m b e r b an k s in leadin g citie s. L a te s t figures are averages of first tw o w eeks in J u n e . M o n th ly rates in th e op en Y o r k : c o m m e rc ia l paper rate paper. A ccep tan ce rate on a ccep tan ces. L a te st figures first 20 days in J u n e . m a rk e t in New on 4 to 6 m o n t h 9 0 -d a y b a n k e rs’ are averages o f Page One Bank credit. Loans and investments o f reporting member banks increased further by $265,000,000 in the four weeks ending June 11, to a level con siderably higher than a year ago. The increase was entirely in investments and in loans on securities, o f which a large part represented loans made by New Y ork City banks to brokers and dealers in securities in replacement of loans withdrawn by other tenders. “ All other” loans continued to decline and at $8,400,000,000 on June 11 were the smallest since 1926. Expansion o f member bank credit during this period was reflected in larger demand deposits and an in crease o f $30,000,000 in member bank reserves at the reserve banks. The volume o f money in circulation showed a net increase o f $13,000,000. Funds for these uses were obtained largely from further additions o f $24,000,000 to the stock o f monetary gold and from an increase o f $22,000,000 in the volume o f reserve bank credit out standing. Reserve bank holdings of U. S. securities increased by about $50,000,000 and their holdings o f ac ceptances declined by about half this amount. For the week ending June 18, the total volume o f reserve bank credit declined somewhat and there was a decline in the volume o f money in circulation. Money rates in the open market continued to decline during the latter half o f May and the first half o f June, and at the middle o f the month commercial paper at 3^2-3^ Per cent and acceptances at 2% per cent were at the lowest levels since 1924 and early 1925. Bond yields moved slightly lower in June. In the first week of June the rediscount rate at Cleveland was reduced from 4 to 3^2 per cent; in the third week the rate at New York was reduced from 3 to 2y2 per cent and the rate at Chicago from 4 to 3^2 per cent. Business and Financial Conditions in the Philadelphia Federal Reserve District Business activity in general declined in May and in the early part o f June, a further drop in commodity prices, reduced demand, and curtailed opera tions being among the chief features o f the present situation; the character o f this recession is partly seasonal and is common to trade and manufacturing industry. Stocks of finished commodi ties in the main have changed little since the previous month and, except for some instances o f accumulation, compare favorably with those at the same time last year. Evidence o f the prevailing ease of credit continues to accumulate in this district as in the country. Over re cent months the banks have reported an increase in deposits materially in excess o f the demands o f their cus tomers for loans, with the result that surplus funds have been used in the purchase o f investments and com mercial paper. Borrowings from the Federal Reserve Bank have been in small volume and the reserve ratio o f this bank has been unusually high, signifying ample loaning power. Dur ing the past month large member banks in Philadelphia made a further reduction in the rates charged on com mercial loans to prime customers. Most o f the manu facturing industries have entered a period o f summer quiet characteristic o f other recent years. The market for finished goods generally varies from fair to poor and sales have declined since the middle o f last month. Sales are also smaller than at the same time last year, owing at least in part to a steady decline in wholesale commodity Manufacturing. Page Two Latest figure compared with Business indicators Philadelphia Federal Reserve District M ay, 1930 Previous month Year ago Retail trade— estimated net sales (158 stores).......................................................... (daily average) Department stores (6 5)............................... “ “ Apparel stores (3 7)....................................... “ “ Shoe stores (4 0 )............................................. “ “ Credit stores (1 6 ).......................................... “ “ *871,500 *734,300 *104,500 *16,000 *16,700 - 7 .0 % - 5 .5 “ -2 2 .9 “ - 5 .8 “ - 0 .3 “ W holesale trade— net sales (103 firm s). . . . (daily average) Boots and shoes ( 5 ) ...................................... “ “ Drugs (1 0)...................................................... “ “ Dry goods (1 2 ).............................................. “ “ Electrical supplies (5 ).................................. “ “ Groceries (3 2)................................................ “ “ Hardware (2 2 )............................................... “ “ Jewelry (1 0 )................................................... “ “ Paper (7 )......................................................... “ “ *287,200 *4,000 *45,200 *13,200 *16,500 *110,200 *71,000 *9,800 *17,300 + 4 .9 -1 4 .5 - 0 .5 + 7 .8 -1 1 .7 + 7 .9 + 9 .4 + 11.6 + 2 .8 8 “ “ “ “ “ “ “ “ Productive activity— Employment— 843 plants in Penna........................................ Wage payments in above plants............................................. 326,701 *8,647,127 lbs. . '........... 214'399 592,977 to n s ................. 8,814 to n s ......................201 ton s......................266 to n s............. 224,385 to n s............. 397,800 - 2 .0 - 4 .1 — 13.0 - 3 .2 - 4 .1 + 5 .8 -1 2 .4 - 6 .9 - 3 .3 + 14.1 - 3 .7 “ “ “ “ “ “ “ “ “ “ “ — 9 .0 “ — 27.4 “ — 16.9 “ — 7 .3 “ — 7 .5 “ — 12.0 “ bbls................ 48,800 bbls..............119,581 K W H .. .17,567,200 - 6 .2 “ + 17.0 “ - 4 .4 “ — 19.6 “ 4 .7 “ + 4 .6 “ + $2,517,800,000 - — 15.3 “ *1,708,800,000 *29,800,000 *21,209,000 *11,677,500 113 $1,498,497 + 2 .5 + 5 .3 - 4 .5 + 4 0 .1 - 0 .9 -3 5 .3 Active cotton spindle hours (P enn a.). . . . Pig iron production...................................... Iron casting production— 34 foundries. . . Steel casting production— 11 foundries... Anthracite...................................................... Bituminous coal (Penna.)........................... Petroleum receipts at Port of Philadelphia— domestic and foreign.................... C em ent........................................................... Electric power output— 12 system s.......... “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ Financial and credit— Debits (check payments)— 18 cities....................................... Loans and invest ments— middle of June— (reporting member ban ks)................................................................................ Bills discounted held by F. R . B. of Phila. (daily average) Bankers’ acceptances outstanding— end of m onth............. Commercial paper sales— 4 dealers........................................ Commercial failures— num ber................................................. Commercial failures— liabilities.............................................. Building and real estate— Building permits— 17 cities...................................................... Building contracts awarded..................................................... Number of real estate deeds recorded (Philadelphia co u n ty )..................................................................................... Value of mortgages recorded (Philadelphia co u n ty)........... Sheriff sale— number of writs issued for June— (Philadelphia cou n ty )............................................................................ 0 .1 “ — — + + _ — + — — — — - 1 .8 % 2 .1 “ 1 .3 “ 2 .8 “ 9 .0 “ 2 .9 9 .6 4 .2 2 .2 2 .6 2 .0 0 .8 30.3 11.2 “ “ “ “ “ “ “ “ “ — 3 .1 “ — 10.6 “ “ “ “ “ “ “ + 1 .6 6 4.8 4 4.9 + + 8 5 1 .3 29.9 + 2 1.2 “ “ “ “ “ “ *7,772,074 *23,254,400 -4 6 .3 “ -4 4 .7 “ — 5 2.9 “ 3 8.5 “ 5,178 *12,878,199 + 2 2 .9 “ + 2 3 .1 “ — 2 .4 “ 2 7.7 “ 2 8.5 “ — — 1,140 -1 4 .3 “ + Miscellaneous— Freight car loadings (Allegheny d istrict).............................. 846,306 Sales of life insurance (Penna., N. J., and D e l.).................. Automobile sales registrations of new passenger cars......... *112,249,000 20,169 + 4 .5 “ + 7 .7 “ - 6 .9 “ - 0 .9 “ — 13.1 “ + 9 .5 “ 1 .8 “ + 19.8 “ * Bureau of Census preliminary figures. prices for most manufactured goods. Inventories o f finished commodities held at manufacturing plants are mod erate, although several individual in dustries report some accumulation. Stocks o f metal products, for instance, have been reduced somewhat during the month, while those o f leather and certain other products show some in crease. In comparison with a year ago, however, inventories in the ag gregate appear to be smaller. Plant operations have been curtailed rather extensively as is to be expected at this time. Factory employment in this section declined slightly more than' usual between April and May. W age payments and employe-hours also showed an appreciable decrease, indicating a lower rate o f operations than in the preceding month. In com parison with May 1929, when fac tories were increasing their activity, the number o f wage earners and the volume o f wage disbursements were noticeably smaller. Estimates based on our indexes show that, in the first five months o f this year, factories in Pennsylvania paid out in wages ap proximately 550 millions which was about 4 per cent less than in the same period last year. As a result o f slackened demand, productive activity o f the iron and steel industry has declined further. The output o f pig iron and steel ingots decreased by about the usual seasonal amount between April and May. This was true also o f iron and steel cast ings. Activity o f the electrical ap paratus industry, too, has declined from a relatively high level in April. In the transportation equipment group, the output o f commercial trucks, boats and ships continued on the in crease, while that o f automobile parts and bodies, and locomotives and cars showed the customary let-down. Virtually all leading textile branches are passing through a period o f the usual summer dullness which this year has been accentuated by the con tinuous decline in textile prices. Some accumulation in stocks o f finished goods, particularly silk, cotton and wool fabrics, and hosiery, reflect an other unfavorable feature in the tex tile situation. The output o f silk manufactures and hosiery thus has been sharply curtailed since March. Productive activity in the cotton, wool, and floor coverings industries, on the other hand, showed some im provement in May although the rate M ay, 1930 (Daily average) Electric power Philadelphia Federal Reserve District 12 Systems Change from M ay 1929 Change from Apr. 1930 Rated generator ca p a city. . . . + 7 .3 % + 2 .7 % Generated ou tp u t..................... H ydro-electric....................... Steam ...................................... Purchased............................... + 4 .6 -3 3 .6 + 5 1.5 - 7 .6 - 4 .4 -3 5 .1 + 2 1.5 - 4 .1 Sales of electricity.................... Lighting.................................. M unicipal........................... Residential and commercial................................... P ow er...................................... M unicipal........................... Street cars and railroads. . Industries........................... + 4 .1 “ + 9 .5 “ + 9 .6 “ - 4 .4 “ - 9 .7 “ -1 0 .8 “ + + + + + - 9 .6 “ + 2 .5 “ + 8 .6 “ - 6 .2 “ + 3 .9 “ All other sales............................ - 9 .5 4 .8 6 2.9 3 .7 4 .0 “ “ “ “ “ “ “ “ “* 7 .7 “ “ “ “ “ -3 0 .5 “ * W orking days average o f operation continued lower than in many years past. The group comprising various food items on the whole has been holding its ground. Meat packing and slaught erings showed a higher rate of activity in May than in April and compared favorably with other recent years. The output o f sugar and creamery products also showed a noticeable gain as is to be expected at this time. Production o f boots and shoes in May declined by about the usual sea sonal amount but remained in excess o f the volume for that month in other years except 1929. The leather tanning industry reported a higher rate of operations in May than in April or in May 1929. Business in kid leather generally is fairly active with prices showing little change. The hide market lately exhibited considerable strength with respect to demand but not prices, whereas the demand and prices for goat skins have eased off slightly. Imports o f goat and kid skins were materially larger in May this year than last, whereas the value was substantially smaller, reflecting lower prices. Conditions in industrial chemicals and drugs are more than seasonally quiet, production in May declining more than is usual for that month. Activity in wood distillation also de clined to the lowest level since 1928, reflecting largely curtailed activity in the textile industry. Paints and var nishes, after a steady rise in earlier months, declined in May, contrary to the usual seasonal tendency. A let down is also evidenced in the output o f explosives and by-product coke. Petroleum refining, while declining in the month, continued well above the level o f previous years. Daily production o f Portland cement in May showed a much larger increase than is customary for that month and exceeded the volume o f a year ago by almost 5 per cent. Shipments o f Penn sylvania cement likewise increased in the month but were slightly under those o f a year earlier. Stocks at the beginning o f May were somewhat larger than at the same time last year. Productive activity o f lumber and planing mills, after declining almost steadily since last fall, turned upward in May by about the usual seasonal amount; nevertheless, the output re mained in a substantially reduced volume in comparison with the past seven years. Production and ship ments o f face brick showed a further increase during the month. Building and real estate. Construc tion activity has cOntinuted to ex pand moderately since early spring, owing largely to increased contracts for public works and utilities, al though the present level remains be low that o f other recent years. The enlarged operations in recent weeks are evidenced not only by the greater number o f workers who have been taken on steadily since March but also by the increased consumption o f such building materials as lumber, cement and other stone and clay products. The value o f building contracts awarded during May, nevertheless, declined sharply from the preceding month and was substantially below that o f the previous year. Estimates for the early part o f June, however, show a noticeable gain over the May daily average, principally on account o f a further expansion in the con struction o f other than the residential type o f buildings. Per cent change from Building contracts (000’s omitted in dollar figures) months 1930 1929 1925-28 average Philadelphia............... $ 81,996 R ead in g ...................... 1,339 Scranton...................... 2,794 Cam den....................... 2,130 T renton....................... 1,402 W ilm ington................. 3,478 + 0 .0 — 75.5 + 128.6 - 76.8 - 63.6 - 40.7 -1 0 .8 -4 4 .8 + 35.0 -4 2 .3 -5 6 .8 + 59.1 Total for Philadel phia Federal R e serve District, in cluding all cities.. . - -1 4 .9 162,456 18.3 Source: F. W. Dodge Corporation The estimated expenditure under building permits issued in 17 cities Page Three o f this district declined materially be tween April and May and was only about one-half o f the amount reported for May 1929. The real estate market, while con tinuing below the level o f last year, showed some improvement in May. The number o f real estate deeds and the value o f mortgages recorded in Philadelphia were about 23 per cent larger in May than in April, indicating more active purchases. In comparison with a year ago, however, both deeds and mortgages were smaller. The number o f court writs issued for sher iff’s sale o f properties in June de clined about 14 per cent from the previous month. In comparison with a year ago, however, foreclosures were nearly 29 per cent larger. Coal. The dullness in the anthracite market, which was manifest in April, continued until the latter part o f May, when some impetus was given to buy ing by the anticipation o f seasonal price advances. The daily output of collieries increased in May with the total production amounting to 5,384,000 tons, an increase o f 918,000 tons over the preceding month. In the first fortnight o f June, however, produc tion declined and was smaller than in the corresponding periods o f a month and year ago. Reflecting a reduced rate o f activ ity on the part o f some industries dur ing the month, the daily output o f bi tuminous coal declined in May. P ro duction increased the first week in June but was below a month and year ago. Colliery output in May amounted to 10.344.000 tons, as compared with 11.752.000 tons last year, but was considerably larger than in the same period o f 1928. Agriculture. The agricultural situa tion in this district, considered from the standpoint o f crop yields, gener ally is satisfactory, but the market outlook appears to be uncertain in view o f the nation-wide decline in prices for farm products, according to reports from local county agents. The June 1 condition o f winter wheat in Pennsylvania has been re ported as 83 per cent o f normal, com pared with 91 per cent in 1929, and 86 per cent for the ten year aver age. This figure compares favorably with the estimate o f 71.7 per cent for the country. Spring wheat in Penn sylvania, as shown by reports o f the June 1 condition, is estimated at 84 per cent o f normal. Paae Four Although the growth o f orchard crops was temporarily retarded by cold dry weather in the latter part o f May, warmer nights and subse quent rains have brought relief. The June 1 condition o f apples was 63.3 per cent o f normal, suggesting a slightly heavier crop than a year ago, but reports o f peach condition are unsatisfactory, 37.6 per cent being the indicated yield as compared with 79.0 per cent last year and 62.3 per cent for the ten year average. Corn, potatoes and truck crops have also been benefited by the recent rains and are now in a good state o f culti vation. Pastures and meadows have revived and are generally in good condition. Dairying in this district is fair to good; as in the case o f most agricul tural commodities, prices o f dairy products have declined. Herds are re ported to be in good condition with the number o f cows increasing. Distribution. The dollar volume of sales by wholesale and jobbing estab lishments showed an increase o f al most 5 per cent between April and May in spite o f the fact that shoes, drugs, and electrical supplies had smaller, sales. In comparison with a year ago, however, the dollar volume was nearly 3 per cent smaller. Sales o f drugs alone were larger. Since the first o f the year, business in all reporting lines has been smaller as compared with that in the first five months o f last year. Inasmuch as these sales a re rep orted in dollars, the continuous decline in wholesale com modity prices necessarily should be considered in estimating the physical volume o f wholsale trade this year as against that o f last year. According to Fisher’s index, wholesale com modity prices declined about 5 per cent in the first five months this year, and in May the level was nearly 8 per cent below that o f May, 1929. On June 20 this year, this index dropped to 86.2 per cent o f the 1926 average from 88.4 per cent four weeks a g o ; last year at the same time it stood at 97.6 per cent, or 13.2 per cent higher than this year. Early reports covering about the first fortnight o f June show that most wholesale lines are having a fair amount o f business. Nevertheless, sales since the middle o f last month have been smaller, as is generally to be expected. Prices continue down ward, especially on dry goods, gro ceries, and hardware. Retail sales in May declined sea sonally and were slightly less than two per cent below the dollar volume in May, 1929. Sales in the first five months o f this year were about 4 per cent smaller than those in the same period last year. Department, men’s apparel, and credit stores had smaller sales in May this year than last, while women’s apparel and shoe stores showed increases. City areas, including Johnstown, Lancaster, Read ing, Wilmington, and Allentown-Bethlehem-Easton, reported gains in sales over the previous year, whereas other trading centers had smaller volumes. Business during the first fortnight o f June was described in the prelim inary reports as moving forward at a fair rate. Nevertheless, reports showing increased sales since the mid dle o f last month were outnumbered by those showing smaller sales, which is not unusual at this season. Price reductions have been more numerous than in earlier months, reflecting prob ably the continuous downward trend in wholesale commodity prices. Inventories held at retail establish ments declined nearly 5 per cent be tween April and May, all reporting lines listing smaller stocks, except shoe stores. In comparison with May 31, 1929, retail stocks were about 6 per cent smaller. Shoe stocks were about 2 per cent larger than last year. The rate o f turnover in May and since the first o f the year was somewhat higher than in the preced ing month and in the first five months o f 1929. Railroad shipments o f commodities in this section increased by about the usual seasonal amount between April and May, and in the early part o f June total loadings showed a further increase as is to be expected. This latest gain was due chiefly to larger shipments o f coal, merchandise, grain and grain products, and livestock. Sales o f new passenger automobiles declined slightly in M ay; ordinarily sales in May continue at the April level. In comparison with a year earlier, sales were nearly 20 per cent smaller. The number o f cars sold in the first five months o f this year was almost 17 per cent below that in the same period last year. Financial conditions. Further ease in the banking situation in this district is indicated by the lowering o f rates on commercial loans to prime custom ers by large member banks in Phila- delphia. The rates mostly fall within a range o f Ay2 to 5 per cent and the general average works out at 4.78 per cent, which is the lowest since the spring o f 1928, and compares with 5.93 per cent at the highest point last fall. The call money renewal rate in this city has been maintained at 4 per cent, and no changes have been made during the past month in the discount rate or in the bill buying rates o f the Federal Reserve Bank. The most striking feature in the figures o f the reporting member banks is an expansion o f 34 millions in their net demand and time deposits between May 14 and June 18; United States deposits also increased substantially as the result o f a new issue o f govern ment securities for which payment was made largely by deposit credit. The addition o f 22 millions to invest ments, shown in the accompanying table, was by no means entirely the result o f heavier holdings o f govern Changes since Reporting m ember banks in 21 cities (000,000’s omitted) June 18, 1930 Reported by 89 banks: Loans on securities........... 8 Other (largely commer cial) loans........................ Reported b y 101 banks: Total loans and discounts. Investments........................ Net demand and time de posits ................................ M ay 14, 1930 June 12, 1929 589 + $10 + $30 597 + 11 - 8 1,246 463 + + 19 22 + + 23 4 1,445 + 34 + 45 ment securities, for the banks also materially enlarged their holdings of other securities. Loans on securities have expanded recently, and now are substantially greater than a year ago. Other loans, largely commercial in character, also have increased during the past month, which is rather sur prising in view o f the decline in prices and the existence o f seasonal quiet in general business; these addi tional loans possibly may be the result o f real estate transactions, temporary loans o f reserve funds to other banks, or to the acquisition o f commercial paper. Additional evidence o f the current ease in credit is given in the weekly statements o f the Federal Reserve Bank o f Philadelphia. The reserve ratio, at 83.7 per cent on June 18, shows a strong reserve position, and bills discounted for member banks are in small volume. There was a decline in bills discounted for mem ber banks and an increase in their r e s e r v e deposits during the four weeks ended June 18. Over the end o f May currency requirements in creased as the re sult o f holiday and month-end payroll requirements, but by June 18 nearly all o f this addi tional money had returned; the de mand for it, moreover, remains smaller than last year at this time, owing largely, no doubt, to reduced payrolls. During the past four weeks the Government has collected large sums in this district; withdrawals from de positaries amounted to about 4 mil lions, income tax checks totaled more than 30 millions, and duties paid on imports were unusually heavy just prior to the time when the new tariff law went into effect. Disbursements here by the Government on account o f maturing securities and coupon payments amounted only to about 14 millions in this period. A s a result o f its various fiscal activities, the Gov ernment was able to transfer large sums to other districts; this loss o f funds to the district, however, was more than offset by large favorable balances in the interdistrict settlements. About 30 millions o f the new issue o f certificates o f indebtedness, bearing 2 per cent interest, was allotted to this district, but the banks quickly dis posed o f a considerable portion o f this amount. Federal Reserve Philadelphia (Dollar figures in millions) Changes in— 18, 1930 Bills discounted for banks in Phila delphia .............. $ 2 .6 Other communi 22.9 ties ..................... Four weeks One year -$ 1 .0 -$ 2 3 .3 - - On June 18 bills discounted were only about one-fifth as large as they were at the highest point o f 1929. The bill buying rate o f this bank has been high relative to open market rates, which have declined during the past month, with the result that the bank’s holdings o f purchased bills have diminished to a point little above the exceptionally low figure o f about 2 millions at the beginning o f A u gust last year. United States secur ity holdings, however, have increased as the result o f recent purchases by the system for the special investment account, in which this bank parti cipates. For the fifth consecutive month sales o f commercial paper have been heavy, according to the reports o f four deal ers operating in this district. During May, sales totaled $11,677,500, mostly to city banks, as compared with $1,227,500 a year ago, when city banks purchased nothing, and $5,112,500 two years ago. In the first five months o f the year sales amounted to $54,000,000 as compared with $14,000,000 in the same period o f 1929; the latest total was the largest for any similar period in records going back to 1923. Reports o f the dealers are summarized in the following table: Sales to 3 .0 22.7 paper sales (four dealers) T o t a l b ills d is counted ............. $ 25.5 Bills bough t.............. 2 .6 United States se 50.2 curities .............. Other securities....... 1.0 —$4 .0 - 2 .0 -$ 4 6 .0 6 .9 + 4.1 0 + 33.7 + .6 Total bills and securities........... $ 79.3 Member banks’ re serve deposits.. 140.1 Cash reserves........... 225.6 Reserve ratio............ 8 3 .7 % -S I .9 -$ 1 8 .6 + + + + 5 .8 6 .9 + 1 .9 % + 4 .3 12.6 7 .9 % 1930— M a r... A p r .. . M a y .. 1929— M a y .. Totals for first five months: 1930........... 1929........... 1928........... T otal sales City banks Country banks $7,840,000 $4,495,000 $12,335,000 4,265,000 4,072,500 8,337,500 7,762,500 3,915,000 11,677,500 1,227,500 0 1,227,500 27,755,000 26,707,000 5,230,000 9,157,500 13,988,500 18,853,000 54,462,000 14,387,500 32,841,500 Page Five Payrolls M ay, 1930 Employment M ay, 1930 Employment and wages in Pennsylvania Per cent change since M ay index* Apr., 1930 May, 1929 All manufacturing industries (5 1 )........................ 95.6 M etal products..................... Blast furnaces................... Steel wks. & rolling mills. Iron and steel forgings.. . Structural iron w ork . . . . St. & hot wtr. htg. a p . . . Stoves and furnaces........ Foundries........................... Machinery and parts. . . . Electrical apparatus........ Engines and pum ps........ Hardware and tools......... Brass and bronze prods... 92.4 57.8 84.8 94.5 127.9 101.5 68.9 98.9 100.5 113.8 95.6 93.3 105.3 May, 1929 Apr., 1930 96.5 -1 0 .6 - - 6 .7 -1 2 .0 - 7 .0 - 6 .3 + 6 .4 - 2 .5 -1 6 .0 - 5 .3 - 8 .0 - 3 .9 - 2 .6 -1 6 .3 -2 0 .4 - 1.8 - 4 .5 - 1.9 -2 .0 + 3.7 - 1.5 -1 5 .3 - 1.9 - 4 .2 - 1.3 + 1.0 - 3.6 - 0 .8 95.5 59.2 88.4 89.8 127.6 99.5 59.8 94.8 9 4.3 129.2 100.7 84.6 102.6 -1 4 .3 - 9 .2 -1 6 .8 -2 3 .8 + 2 .9 -1 3 .3 -1 3 .8 -1 6 .0 -2 0 .8 - 3 .8 - 9 .4 -2 7 .3 -2 5 .3 - 3.3 - 2 .0 - 3 .2 - 9 .9 - 0 .6 — 0 .0 -1 7 .6 - 5 .8 - 7 .5 - 1.4 + 2 .2 - 9 .7 - 0.1 + 4 .4 + 2 2 .8 -2 3 .8 - 5.2 - 2 .5 + 67.7 - 2.3 + 19.3 - 7.0 - 1.8 + 1.2 + 0.1 8 4 .7 t 76.2 80.3 55.6 84.8 156.3 - + 22.7 -2 8 .0 - 3 .8 - 3 .2 + 69.9 - 4 .8 + 19.4 -1 7 .0 - 2.1 - 0 .2 + 7 .5 99.4 74.9 53.2 112.1 95.3 73.2 89.1 119.9 91.4 85.2 112.2 134.0 - 6 .5 -1 8 .3 -2 1 .4 - 0 .2 -1 0 .7 - 1.1 - 9.1 - 8 .3 - 4 .3 - 4 .9 -1 3 .7 + 5.4 + + + - 3 .4 3.0 1.7 6 .0 4.1 0.4 0.6 3.5 2.4 0.7 8.9 3.4 89.2 63.2 4 7.3 110.5 89.4 63.5 63.9 110.2 90.1 87.9 113.5 118.3 -3 3 .0 -2 8 .4 -1 3 .3 -2 1 .2 - 7 .7 -3 5 .1 -3 5 .1 -2 2 .7 - 8 .4 + 17.1 - 9 .5 -1 0 .7 + 2 .9 + 10.5 -1 1 .1 -1 4 .1 + 2 .3 - 0 .5 -2 2 .1 - 2.4 + 0 .6 - 9.4 -1 3 .8 Foods and tob a cco............... 112.1 Bread & baker p rod s. . . . 113.6 C onfectionery................... 96.5 Ice cream ........................... 125.1 M eat packing................... 96.4 Cigars & to b a cco ............. 113.5 + 11.1 + 2 .6 + 1.4 0 + 11.8 - 1.5 + 22.7 + + + 2 .5 1.5 25.4 0.3 2 .3 109.5 113.5 102.4 127.4 94.9 100.1 + + + + 7 .8 0.1 0 .6 14.2 2 .2 18.9 + + + + + 5 .9 0 .8 1 .2 22.9 0 .4 11.2 - 6.5 -1 2 .4 - 9 .4 - 7 .3 -2 0 .7 - 7 .8 -2 2 .7 -2 2 .2 -2 6 .4 - 9 .2 - 0 .7 + 2 .0 - 2 .6 + 1.7 + - 8 5 .lt A utom obiles...................... 86.6 Auto, bodies and parts.. . 9 0.5 Locom otives and cars. . . 53.1 Railroad repair shops. . . . 78.1 Shipbuilding...................... 89.7 Textile products................... C otton good s.................... W oolens and w orsteds.. . Silk g ood s.......................... Tex. dyeing & finishing. . Carpets and ru gs............. H a ts.................................... H osiery............................... Knit goods, O ther............ M en’s clothing................. W om en’s clothing............ Shirts & furnishings........ 3.1 Per cent change since 2 .0 Transportation equipm ent.. - M ay M ay, 1930 compared with M ay, 1929 - Stone, clay & glass p rod s. . Brick, tile & p ottery. . . . C em ent............................... Glass................................... 75.9 88.4 64.3 79.3 - 8 .6 - 0 .9 - 7 .3 -1 6 .5 + 1.4 -1 0 .3 - 9 .8 72.9 82.1 65.9 78.7 Lumber products................. Lumber & planing mills.. Furniture........................... W ooden boxes................... 73.8 66.2 74.6 68.3 -1 6 .9 -2 1 .5 -1 7 .2 - 6 .4 - 1.6 0.7 1.7 3.8 70.1 65.4 69.8 65.2 Chemical products............... Chemicals and drugs. . . . C oke.................................... E xplosives......................... Paints & varnishes........... Petroleum refining........... 101 .0 80.4 109.9 84.5 100.1 126.7 + 6 .7 - 6 .4 + 17.7 -1 0 .7 - 2 .0 + 10.8 + + - 3.3 9 .3 0 .5 0.6 2.9 4.7 109.2 81.0 97.2 90.1 109.7 144.1 Leather & rubber p ro d s ... . 97.4 Leather tanning............... 104.3 Shoes................................... 93.6 Leather products, O ther. 99.5 Rubber tires & good s. . . . 88.5 Paper and printing............... 98.2 Paper and wood p u lp . . . . 84.6 Paper boxes and bag s. . . 90.0 Printing & publishing. . . 103.4 Anthracite.............................. 94.5 Construction & contracting 103.8 Street railways..................... 85.3 95.3 91.3 -2 4 .1 8 .2 - 6 .9 + 16.0 -2 0 .2 - 3 .8 + 15.1 - 1 .9 - 9 .7 -1 0 .6 + 0.1 0 - 2.9 + 13.1 + 0.5 100.8 + 0.2 + 0 .8 104.8 98,7 91.5 108.7 + 2 .8 - 2 .7 - 3 .3 - 4 .5 + + 1.4 1.1 3 .6 6 .2 + — - 2 .8 0 .2 4 .6 3.7 - 1.2 2.4 2.4 0 .5 108.1 - 2 .7 - 4 .4 -1 7 .0 — 3 .5 - 4 .8 - 6 .9 9.1 4 .0 -1 1 .8 + + + + 11.4 3.3 84.2 - 11.3 9 6.8 92.9 + 31 .8 - 5 .7 + 7 .4 - 0.1 + - 2.1 6 .8 1.5 4 .7 0 .6 0.3 0.4 89.7 89.5 114.5 + - 1.4 3 .0 5.3 Allentown area Altoona “ Harrisburg “ Johnstown “ Lancaster “ Philadelphia “ Reading “ Scranton “ Trenton “ Wilkes-Barre “ Williamsport “ Wilmington “ York “ E m ploy ment Wage payments + + + + - - 9 .2 % + 1.2 “ -1 0 .5 “ - 9 .7 “ -1 0 .5 “ -1 2 .9 “ -2 0 .4 “ - 9 .2 “ -1 8 .3 “ - 2 .1 “ -1 3 .4 “ + 0 .2 - 6 .9 “ 3 .6 % 9 .1 “ 3 .4 “ 5 .5 “ 6 .3 “ 8 .6 “ 3 .8 “ 0 .8 “ 8 .8 “ 8 .6 “ 8 .0 “ 2.1 “ 2 .3 “ Building permits (value) + + + + 6 0 .0 % 1 .3 “ 13.5 “ 7 0.5 “ 6 0.4 “ 45.1 “ 8 4.8 “ 558.3 “ 79.9 “ 21.1 “ 71.1 “ 2 1 .4 “ 19.5 “ Retail trade sales Debits + 0 .5 % - 1 .9 “ - 2 .1 “ + 5 .7 “ + 4 .2 “ - 1 .9 “ + 2 .2 “ - 6 .7 “ - 1 .8 “ - 5 .6 “ - 9 .9 % - 0 .7 “ - 7 .9 “ - 9 .4 “ - 1 .8 “ -1 7 .2 “ - 9 .5 “ -1 5 .1 - 4 .6 “ -1 8 .0 “ -1 0 .1 “ -1 7 .2 “ - 5 .0 “ + 0 .6 “ M ay, 1930 compared with April, 1930 Allentown area Altoona “ Harrisburg “ Johnstown “ Lancaster “ Philadelphia “ Reading “ Scranton “ Trenton “ Wilkes-Barre “ Williamsport “ Wilmington “ York “ + - 5 .7 % 0 .5 “ 1 .0 “ 6.1 “ 2 .2 “ 0 .9 “ 1.3 “ 3 .6 “ 1.1 “ 0.1 “ 1.7 “ 4 .8 “ 1.9 “ - 7 .4 % 8 .7 “ 3 .2 “ 7 .3 “ 2.1 “ 3 .4 “ 9 .7 “ 2 .9 “ 4 .9 “ 4 .0 “ 2 .4 “ 4 .4 “ 0 .5 “ - 5 7 .9 % - 57.9 “ 9.1 “ + 150.3 “ - 23.1 “ - 53.1 “ - 8 2.4 “ + 354.1 “ - 5 9.6 “ + 7 .5 “ - 7 8.5 “ + 2 8.0 “ + 14.6 “ W holesale trade Philadelphia Federal Reserve District Dry good s.............. Electrical supplies. Groceries................. H ardware............... Jewelry................... P aper....................... From During Jan. 1 to M ay, 1930 M ay 31, compared compared with M ay, with same 1929 period last year - 9 .6 % + 4 . 2 '“ - 2 .2 “ - 2 .6 “ - 2 .0 “ - 0 .8 “ -3 0 .3 “ -1 1 .2 “ - 6 .5 % - 1 .5 “ - 7 .4 “ -1 5 .2 “ - 1 .8 “ - 5 .0 “ -2 4 .5 “ - 6 .9 “ M ay, 1930, with M ay, 1929 + 2 2.8 “ M ay 31, 1929 Apr. 30, 1930 -1 1 .7 % -2 3 .9 “ -1 1 .6 “ - 2 .0 “ -1 3 .4 “ - 2 .8 “ - 3 .0 % -1 4 .5 “ - 7 .4 “ - 1 .2 “ - 0 .6 “ - 2 .5 “ -1 2 .6 % + 7 .1 “ - 5 .0 “ + 1 .8 “ + 0 .6 “ - 2 .9 “ -2 1 .8 “ - 5 .1 “ Stocks M ay 31, 1930 compared with Comparison of stocks Comparison of net sales Retail trade Philadelphia Federal Reserve District -1 4 .6 % + 17.4 “ + 13.5 “ - 4 .7 “ -1 3 .7 “ - 9 .2 “ -2 0 .9 “ - 4 .5 “ - 5 .0 “ - 3 .7 “ + 3 .2 % - 0 .3 “ - 1.6 “ + 1.9 “ -1 2 .8 “ + 0 .7 “ - 3 .3 “ - 8 .3 “ + 3 .5 “ - 2 .4 “ + 10.4 “ -1 1 .4 “ + 0 .2 “ Collec tions during M ay, 1930, compared with M ay, 1929 Net sales 4.1 7 .6 2 .7 4 .0 1 .2 4 .5 - 0.3 + 1.9 - 3 .4 + 2 .5 - 5 .2 * 1923-1925 average =100. f Preliminary figures Page Six 0 .9 4.1 Philadelphia Federal Reserve District Rate of turnover, Jan. 1 to Jan. 1 to M ay 31, 1930 M ay 31 M ay 31, 1930, with with with Jan. 1 to M av 31, Apr. 30 1929 M ay 31, 1930 1929 1930 1929 All reporting stores................ -1 .8 % -3 .7 % -6 .1 % - 4 . 5 % 1.53 1.55 Department stores................. in Philadelphia. . ............... outside Philadelphia.......... -2 .1 “ -2 .6 “ -1 .1 “ + 1.3“ -4 .1 “ -3 6 “ -4 .5 “ + 2 .8 “ + 2 .7 “ + 3 .6 “ + 2 .8 “ -9 .0 “ -4 .1 “ -3 .5 “ -5 .5 “ -7 .3 “ -7 .0 “ -7 .9 “ - 4 . 8 “ 1.50 1.53 - 5 . 0 “ 1.65 1.70 - 4 . 4 “ 1.21 1.22 -3 .9 -4 4 -3 .5 + 0 .3 + 0 .7 -2 .3 -2 .6 -5 .3 + 1.7 + 8 .5 + 9 .2 + 5 .9 + 2 .0 -4 .0 -0 .9 -3 .0 -3 .2 -2 .2 + 2 .6 -2 .7 outside Philadelphia. . . . W omen's apparel stores.. . in Philadelphia............... outside Philadelphia. . . . Shoe stores............................... Credit stores............................ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ “ 0.96 2 .55 2 .76 1.66 1.11 0.97 0.93 2.48 2.67 1.64 1.13 0.97 AUTOMOBILE P H IL A . REGISTRATION FED. RES. D IS T R IC T PA S S E .N G E =? C A R S l\ 1 1“ 1 1 1 . V 1 9 2 3 -- 2 5 / 1 | 11NDC n | \ J1 1 1 / n i f; ft Y 'h jn K f1 I J V A D JU S TED Y 3 S E A S O NAL CHANGES j Y 1 \ T FOR 1926 1927 1928 1929 1930 Sources: R. S. Polk Company Pennsylvania Motor List Company CEMENT PHILA. FED. RES. DIST. MILLIONS BARRELS 8 7 r/ \ 6 5 2 1 \ As \ . A iA A v r ' \ 'J BUILDING , A. v ^ PRODUCTION^ 19 27 1928 / r 1929 1930 Source: Department of Commerce ACTIVITY n— ,A V \ /" / / / MATERIALS PRODUCTIVE — t , _______ ” 192 6 Sources: Department of Commerce and Federal Reserve Bank of Phila. '\ \ \( , 4 3 A STOCKS 1 9 2 3 - 25AVG = I00 V\v V a PAINTS ANC VARNISHEDS / r l f" * 1 J A ' \ / ' • VM LUM BER AND PLANING ------------------ 1926 M ilJ_S ' ADJL STED FOR SEASONAL VARIATIONS 1927 1928 1929 1930 Source: Pennsylvania Department o f Labor and Industry Page Seven Synopsis o f Industrial and Trade Conditions in the Philadelphia Federal Reserve District D em and O p eration s S to c k s M a n u fa ctu rin g Iron a n d Steel S teel w ork s and F air to p o o r, d eclin ed D eclined se a so n a lly Q uiet, d eclin ed D eclined rollin g F ou n d ries and m achine D em and fo r iron ca s tin g s tin u ed to declin e, w hile ca s tin g s in creased L o c o m o t iv e s and ca rs ... c o n O u tpu t o f iron an d steel ca s tin g s steel d eclin ed in M ay Q uiet, season a lly D eclin ed as usu a l at this tim e Fair, som e d ecrea se in the m onth D eclined Fair to g o o d Increased, unfilled ord e rs in cr e a s in g Fair t o p o o r, p rice s low er D eclined S to ck s sm aller than a m on th and year ago Sm aller in M ay se a so n a lly T ex tiles sh a rp ly L a rg e r ago F air t o p oor, p rice s low er th a n a m on th and ye a r M edium to ligh t Fair to p o o r, som e in crease Som e in crease M od era te, th o u g h in fa b r ic s la rger th a n a y e a r a g o P oor, declin ed , p rice s u n ch a n g ed Som e gain to low er M od era te b u t la rg e r th a n a yea r ago Fair to p o o r, p rice s u n ch a n g ed to low er D eclined sh a rp ly F u ll-fa sh io n e d h e a v y to m o d e ra te , seam less m ediu m to ligh t P o o r, declined Som e gain la tely Fair to p o o r, d eclin ed D eclined M od era te t o ligh t, som e in crease in the m o n th Fair to p o o r, little ch an ge U n ch an ged U n ch a n ge d F airly a ctiv e Som e in crease M edium Fair to p o o r L ow er M od erate in M ay but d eclin ed M od era te to ligh t L eather p ro d u cts B uilding m aterials P a in ts and va rn ish es .... G ood , in crea sed ; p rice s u n ch a n g ed Increased H e a vy t o m o d e ra te Fair to p o o r, u n ch a n g e d ; som ew hat low er p rices Som e gain H ea vier th a n a m on th a g o Fair to low er p rices Increased M od era te poor, d e clin e d ; Fair, in creased s e a s o n a lly ; p rices Som e d ecline u n ch a n g ed t o low er M od era te to ligh t Fair to p o o r, som e d ecline S light in crease F a irly h e a v y Fair, little ch an ge D eclined M od era te, som e in cre a se in m on th Fair, u n ch a n ged Increased M od era te t o ligh t F air t o p o o r, d eclin ed D eclined S om ew h a t h eavier Fair to p o o r, d eclin ed L ow er Fair D eclin ed in M ay and u n ch a n g ed sin ce then M iscellan eous Building P erm its sh ow ed in M ay a sh a rp decline V alu e o f M a y c o n tr a c ts m u ch lo w e r than in p re v io u s m on th C oa l m inin g M arket n ot v e r y a ctiv e , ch a n g e in m onth little D eclined sin ce M ay Q uiet D eclined in M ay M od era te M od era te t o ligh t T ra d e F air fo r this tim e, p rice s low er W h o le s a le and jo b b in g . . . . Page Eight S eason a lly fair, sales la rger M ay b u t b e lo w y e a r a g o Sm aller th a n a y e a r a g o in Sm aller th a n a y e a r a g o
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