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_____ If Rfacn,.----------"H*# bank THE BUSINESS REVIEW W q 2? THIRD FEDERAL PHILADELPHIA RESERVE DISTRICT JUNE i, i9if$m^r>iDHem FEDERAL RESERVE BANK OF PHILADELPHIA Business and Banking Conditions in the United States Industrial production declined in thracite in April, while bituminous coal April, reflecting- chiefly reduced activ production showed somewhat less than ity in the cotton textile and lumber the usual seasonal decrease. Crude industries. Distribution of commodities petroleum production continued in increased less than seasonally but con large volume. tinued to be somewhat in excess of Value of construction contracts production. Commodity prices showed awarded, which had increased consider a further decrease. ably in March, showed little change in Production. In April volume of in April, according to figures of the F. W. dustrial production, as measured by the Dodge Corporation. Awards usually Board’s seasonally adjusted index, was increase somewhat further in April. at 77 per cent of the 1923-1925 average In the first four months of this year as compared with the level of about private residential building was about 79 per cent maintained during the first one-fourth less than in the correspond quarter of the year. The decline re ing period last year, while other pri flected chiefly considerable reductions in output at cotton textile mills and vate work, particularly industrial and lumber mills, where there had been utility construction, was only about moderate increases in production in one-half as large as a year ago. March. In most other manufacturing Awards for public projects were some industries, changes in activity were what larger than last year. largely seasonal in character. Output Employment. Factory employment at steel mills continued at around 33 and payrolls declined from the middle per cent of capacity and in the auto of March to the middle of April, and mobile industry showed little change, the Board’s seasonally adjusted index amounting to about 40 per cent of the of employment was at 79 per cent of volume of a year ago. In the first the 1923-1925 average as compared three weeks of May production of steel with 82 in March and 84 at the begin and automobiles was at a lower rate ning of the year. The number em than in April. At mines there was a ployed at automobile factories declined considerable decline in output of an sharply and there were further sub INDUSTRIAL PRODUCTION FACTORY EMPLOYMENT AND PAYROLLS stantial decreases in the steel and ma chinery industries and at railroad re pair shops. Smaller declines were reported in most other manufacturing industries. Employment at mines and on the railroads also decreased, while in trade there was some increase in the number employed, reflecting partly increased business at the Easter season. Distribution. Distribution of com modities to consumers showed less than the usual seasonal rise in April. The Board’s adjusted index of department store sales was 83 in April compared with 86 in March and 90 at the begin ning of the year, and figures for the MEMBER BANKS IN 101 LEADING CITIES Wednesday figures for reporting member banks in 101 leading cities. September 5, 1934 to May 18, 1938. Total deposits, exclud ing interbank, are adjusted to exclude “float.” DEPARTMENT STORE SALES EMPLOYMENT. PAYROLL I A0JUSTE0 FOR SEASONAL VARIATIO WITHOUT SEASONAL ADJUSTMENT Index of physical volume of production, ad justed for seasonal variation. By months, January 1934 to April 1938. Indexes of number employed and payrolls, without adjustment for seasonal variation. By months, January 1934 to April 1938. Indexes of value of sales. By months, January 1934 to April 1938. Page One first half of May indicate a further decrease. Freight-car loadings also declined from March to April, reflect ing largely reduced shipments of mis cellaneous freight, and were about 30 per cent less than in April 1937. Commodity prices. Wholesale prices of industrial commodities continued to decline from the middle of April to the third week of May and prices of agri cultural products also decreased some what further. Steel scrap, copper, and rayon showed considerable declines and there were reductions in prices of some finished industrial products. It was announced that prices of most finished steel products would be un ther, reflecting principally Treasury disbursements from its deposits at the changed for third quarter delivery. reserve' banks, including retirement of Sank credit. Total loans and invest ments of reporting member banks in $50,000,000 of Treasury bills each 101 leading cities showed little change week. during April and the first half of May. Money rates and bond yields. Yields Holdings of United States Government on government securities declined obligations increased somewhat, while slightly further in the four weeks end holdings of other securities and loans ing May 21 to an average for longerdeclined. Adjusted demand deposits in term Treasury bonds of 2.28 per cent. leading cities increased during the The average yield on 3 to 5-vear Treas period as a result of expenditures by ury notes declined to a new low of 0.73 the Treasury from its balances with the per cent. The rate on three-month reserve banks. Interbank deposits also " Treasury bills continued at record low' levels, and other open market money increased substantially. . Member bank reserves increased fur rates remained unchanged. Business and Banking Conditions. in the Philadelphia Federal Reserve District Business activity in the Philadelphia somewhat larger than in early months Federal Reserve District declined sea of last year. Retail trade sales have continued sonally during April and May. Out put of manufactures and mineral prod substantially smaller this year than last, ucts, after rising in March, dropped reflecting primarily slackened indus in April to the lowest level since the trial conditions, with a consequent re third quarter of 1934. The seasonally duction in income of industrial workers, adjusted index of productive activity and labor unsettlement in April in in April was 69 per cent of the 1923-25 some of the larger stores in Philadel average as compared with 72 in March phia. The volume of wholesale trade and 69 in February. A year ago this sales also is running below that of last index was 101, or the highest in seven year. Inventories at retail and whole years. The average rate of industrial sale establishments declined in April production in the first four months of and were smaller than a year ago. this year was 28 per cent lower than in Despite a marked increase during April, sales of new passenger auto the same period last year. The value of building contracts mobiles in the first four months of awarded in April increased sharply this year were the smallest for that over March and compared favorably period since 1934. Freight car loadings with a year ago. Awards in the first have been substantially below those of four months were slightly smaller than a year ago. General employment in twelve in 1937. Farm income from crop mar branches of trade and industry showed ketings has declined, partly as a result of low'er prices, while that from the virtually no change from March to sale of livestock products has been April but payrolls declined about 3 per cent. The number of w'orkers in April was 17 per cent and the amount of compensation 30 per cent smaller than a year ago. Preliminary reports for May indicate marked additional reces sions in employment and payrolls, par ticularly in metal and textile indus tries. A decline in the general level of wholesale commodity prices in the first half of May to the lowest point since 1934 was followed by a rise in the third week which reflected advances in farm products and foods. Manufacturing. Demand for factory products in this district has decreased considerably, following a more active market in March and early April. Cur rent reports indicate that industries making both durable and consumers’ goods have experienced a contraction in sales and a decline in unfilled orders since the middle of last month. De spite a substantial reduction in stocks INCOME PRODUCTION AND PRICES PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT INDUSTRIAL PRODUCTION (pHILA. FAD RES- DIET.) I SALES OF - - - - - FARM PRODUCTS (seasonally adjusted) COMMODITY PRICES-US. (other than tarm products INDUSTRIAL PAYROLLS PENNA PRICES OF RAW MATERIALS 1932 1933 http://fraser.stlouisfed.org/ Page Two Federal Reserve Bank of St. Louis 1934 1935 1937 1938 i- USBupeau of Labor Statistics 1932 1933 1934 1938 ■y « tt of finished goods during the past sev eral months, supplies at present are ample to care for the unusually small volume of new business. Inventories of raw materials and semi-finished goods continue smaller than a year ago and new purchases in most cases are being restricted to immediate require ments. In the textile industry, which had been a leader in gains reported earlier this year, activity has been slackening for several weeks. While seasonal cur tailment in most branches of this in dustry is to be expected, current de mand is exceptionally small and back logs have decreased. This is especially true at woolen and worsted mills mak ing fabrics for men’s clothing, at carpet and rug factories, and in the case of silk and cotton manufactures. In order to avoid accumulation of in ventories, most mills have made strenu ous efforts to adjust output to demand. Prices of textile fibers on the whole have shown some weakness; because of this factor and the quiet market for finished and semi-finished products, there has been little incentive to make advance purchases of raw materials. Prices of manufactured products gen erally have declined a little further, continuing a gradual downward tend ency that has been fairly continuous since about the middle of March. Decreases in quotations for certain textiles, leather products and building materials have been most numerous lately, but prices of fabricated iron and steel products have been relatively firm. The index of the Bureau of Labor Statistics, measuring prices of com modities other than farm products and foods, was 81.7 per cent of the 1926 average on May 21, compared with 82.8 two months earlier and 86.3 a year ago. Factory employment and wage pay ments in this district declined more than they usually do in April, owing principally to larger than seasonal de creases at plants making iron, steel, and nonferrous metal products and clothing. The average number of workers employed was 17 per cent less in the first four months this year than last and payrolls showed a drop of nearly 29 per cent. Preliminary data for May indicate unusually large re cessions in activity at plants producing both durable and nondurable goods. The April index of employment in Pennsylvania factories was about 73 per cent of the 1923-25 average and that of wage payments was 66. These indexes were the lowest for that month in several years and showed declines Business Indicators Philadelphia Federal Reserve District Index numbers: percentages of the 1923-1925 average as 109 Adjusted for seasonal variation Adjusted indexes allow for the usual seasonal change in activity. Unadjusted indexes reflect merely the actual change which may or may not be typical. Not Adjusted Per cent change Apr. Feb. Mar. Apr. 1937 1938 1938 1938 April 1938 from 1938 from Apr. Feb. Mar. Apr. 1937 1938 1938 1938 Month ago Industrial production.............. Manufacturing—total............................ Durable goods.................................... Consumers’ goods............................. Metal products.................................... Textile products.................................. Transportation equipment............ Food products....................................... Tobacco and products..................... Building materials............................. Chemicals and products................. Leather and products....................... Paper and printing............................ Coal mining................................................. Anthracite............................................... Bituminous............................................. Crude oil....................................................... Electric power Output....................................................... Sales, total!............................................ Sales to industries!............................ 57 58 76 74 91 24 106 112 98 r 85 80 112 54 65 70 74 97 30 r 54 125 143 111 96 88 96 r 52 99 r 53 70 48 467 498 50 488 254 241 178 229 224 148 221 222 153 102 118 87 66 68 220 149 -40 + 4 - 9 - 8 -16 - 7 - 7 -16 249 248 180 -21* -36* —44* -18* -31* -40* 92 104 99 58 58 -17* -30* -14* -24* 124 189 105r 136r + 3 -31 +60 -38 -52 -29 - 3 -40 +51 -33 -57 -26 -27 59r 44 40 17 62 63 77 109 31 10 61 r 47 630 371 65 57 17 43 323 - 3 - 2 - 3* - 2* - 3 +40* + 1* + 7* - 7 - 4 - 5 - 7 - 4 -19* -11* -28 -46* - 8* — 6* -39 -35 -36 -10 -24 -49* - 3* _ i* -34 -33 -34 80 r 59 83 75 78 98 72 79 113 88 57 174 137 125 148 140 79 49 83 49 71 55 80 82 72 83 67 126 130 51 53 51 80p 79p 79 70 81 94 126p 139p 49 54 45 +35* +97* +71* — 5* 61 18 120 86 82 42 23 + 8 231 -52 -55 -24 - 3 53 21 127 106 142 118 97 88 99 r 56 103r 57 63 52 481 498 + 12 + 13 +29 -17 -23 - 1 +69 55 65p 65 73p 92 30p 102p 119p 84 46p 45p 53 453 -28 -30 -39 -26 -46 -40 — 15 - 6 -15 -45 -15 + i - 2 + i 69p 67p 55 -32 -31 -44 -23 -51 -34 -24 - 9 -17 -45 -18 -17 — 5* +58* 68 - 3 - 1 - 1 - 0 + i + 0 - 6 - 2 - 4 - 2 + 0 + I - 3 -30 -34 + 6 - 7 - 0* - 3* 72 97 mos. 1937 - 2* - 3* - 3* 101 r 69 98 r 66 Year ago - 7 -18 89 78 75 83 32 29 31 30 88 80 70 73 83 78 80 74 80 70 73 r 83 79 80 75 -12 -20 - 8 -22 -20 lOOr 96 r 70 67 110 57 63 r 76 72 77 94 r 90 78 102 72 69 68p 66p 55 54 62p 68 73 73 89 27 68 T>V 84 29 p 104p 118p 102 122 88 r 86 55 56 51 498 47p 47p 48 467 233 141 227 227 151 75 r 74 73 68 r 68r 66 235 240 152 222 Employment and wages—Pa. Factory—Wage earners........................ Payrolls..................................................... Man-hours (1927-28 = 100).......... General (1932 = 100) Employment.......................................... Payrolls..................................................... 56 104 104 136r 132 Building and real estate Contracts awarded!—total................ Residential!........................................... Non-residential!.................................. Public works and utilities!........... Permits for building—17 cities... . Real estate deeds—Philadelphia! • Writs for Sheriff sales—Phila........... 50 r 35 56 116 54 46 22 21 74 95 13 22 63 r 44 600 364 70 87 14 45 317 52 24 90 72 11 45 535 -11 43 21 61 28 100 68 15 43 562 Distribution Retail trade —sales......................... stocks..................... Wholesale trade—sales........................ . _ stocks..................... Life insurance sales................................. New passenger auto, registrations. Hotels—Occupancy. . . (1934 = 100) Income, total (1934 = 100) Freight car loadings—total................ Merchandise and miscellaneous. Coal............................................................. 78 80 r 76 78 75 78 72p 77p 101 76 75 72 83 81 79 52 53 51 55 55 53 51 52 50 -16* 66 Business liquidations Number......................................................... Amount of liabilities.............................. Payment of accounts Check payments....................................... Rate of collections (actual) Retail trade............................................ 88 33 77 76 30 33 82 29 -13 -12 Prices—United States Wholesale (1926 = 100).................... Farm products...................................... Foods.......................................................... Other commodities............................ Retail Food.............................................. Philadelphia........................................... Scranton................................................... + + + 1* 3* 2* 1* 1* 1* 1* -11* —26* — 15* — 5* - 7* — 8* - 7* - 8* —24* -15* — 2* - 7* — 8* - 8* 92 85 86 86 88 82 79 68 72 82 79 81 76 % change from (In millions of dollars) Apr. 1937 Jan. 1938 Feb. 1938 Mar. 1938 1938 Month ago Year ago 2.1 +11 - 0 + 6 + 2 +62 2 0 2 - 2 - 9 - 8 -37 Banking and credit Federal Reserve Bank Bills discounted.................................... * 1.3 Other bills and securities............... 214 Member bank reserves.................... 430 Reserve ratio (per cent)................. 75.0 Reporting member banks Loans......................................................... ft 450 Investments........................................... 719 Deposits (a)........................................... 1,479 Bankers’ acceptances outstanding. 17.2 * ft 2.4 216 380 72.7 % 456 656 1,362 12.9 $ 2.5 215 374 72.6 ft 453 660 1,355 12.4 ft * Computed from data unadjusted for seasonal variation. ! Not included in production index. ! 3-month moving daily average centered at 3rd month. 1.9 215 368 72.4 $ 448 652 1,333 $ 11.2 214 391 74.2 440 651 1,357 10.8 + - 4 0 - 9 - 1 p—Preliminary. r—Revised. (a) Less cash items in process of collection. Page Three METAL PRICES VALUE OF BUILDING CONTRACTS AWARDED PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT STEEL SCRAP .PRICES OF BUILDING MATERIALS (i9a6«ioo) »» l *i COPPER RESIDENTIAL FINISHED STEEL CONTRACTS. ADJ. FOR SEASONAL VARIATION. 1923-25= 100 fcrryonlba 1935 1936 1937 from a year ago of 21 and 36 per cent respectively. Working time, as meas ured by employee-hours, was 3 per cent less than in March and 44 per cent below the level of a year ago. Manufacturing establishments in New Jersey and Delaware likewise ex perienced decreases in employment and payrolls in April. In both states re ductions from a year ago were sub stantial. Output of manufactures slackened a little in April, following a rising tend ency for two months. This bank’s sea sonally adjusted index was 67 per cent of the 1923-25 average, compared with 68 in March, 66 in February and a high for recent years of nearly 98 in April 1937. The average rate of productive activity in the first four months this year was about 30 per cent below a year ago and the lowest for that period since 1934. Activity in durable goods industries again declined, but the recession in the last two months has been much less pronounced than in the preceding half year. Output of pig iron and iron and steel castings compared favorably with March, after allowance is made for the changes that ordinarily occur. Pro duction of automobile parts and bodies and locomotives and cars, however, de creased appreciably, as did operations at shipyards. Production of textiles showed a marked decline in April, although in the case of silk manufactures, under wear and men’s clothing, plant opera tions were curtailed less than usual. In several other nondurable goods indus tries, including those making food, to bacco and paper products, activity in April decreased more than was to be expected. Output of shoes and goat Page Four 19 3 8 1932 1933 and kid leathers, on the other hand, was well maintained. Production of electric power regis tered a somewhat smaller than seasonal decrease from March to April. Com pared with a year ago, however, it showed a decline of 9 per cent and was 7 per cent less in the first four months this year than last. Coal and other fuels. A decline in the volume of orders received by the anthracite mines affords little evidence of any marked response by consumers to the stimulus of spring reductions in prices. Shipments in April were 11 per cent smaller than in March and only about half of the amount moved a year earlier. Unusually well main tained production in March was fol lowed by a decline of more than 15 per cent in April, when the quantity mined was the smallest for that month since 1933 and 55 per cent under the exceptionally large output in April 1937. Production in the first four months was approximately 20 per cent less than a year ago. The low level of industrial activity continues to affect adversely the de mand for bituminous coal. Output in the Pennsylvania producing area de creased 5 per cent in April, but this was less than the usual reduction in that month. Figures for early May show additional contraction in opera tions. Output and shipments in April were 24 and 19 per cent respectively smaller than a year ago. Production of by-product coke de clined further from March to April, continuing the pronounced downward trend which had been in progress for six months. It was 44 per cent less 1934 1935 1936 1938 1937 than a year ago. Output of gas and fuel oils, on the other hand, in April was 3 per cent larger than a month earlier and a year ago. Building. Awards of building con tracts in this district in April approxi mated $23,000,000, the largest dollar volume in any month since 1931. The increase over March of 74 per cent far exceeded the usual change, and reflected sharp expansion in all types of con struction except factory buildings, and apartments and hotels. The greatest gains were in commercial buildings and in the unclassified group which included contracts for several public buildings and a warehouse. Greater prospective activity in dwelling con struction is indicated by a rise of 34 per cent in contracts for one and two family houses, but the April figure still was 41 per cent smaller than a year ago. Building contracts Philadelphia Federal Reserve District Per cent change April 1938 1938 From (000’s from omitted) month 4 mos. ago 1937 $ 4,125 344 3,781 14,980 2,225 355 3,501 8,899 $19,105 3,801 + 73 + 79 + 9 - 33 + 74 - A - 40 - 48 - 39 + 51 - 31 - 66 +146 +190 $22,906 Public works and utilities. + 27 - 20 + 34 + 92 + 114 - 54 + 33 + 166 ♦ 3 Source: F. W. Dodge Corporation. Total awards were 49 per cent larger than in April 1937, owing chiefly to an increase in contracts let this year for educational and miscellaneous nonresidential structures. In spite of this *■ SALES OF NEW PASSENGER AUTOMOBILES DEPARTMENT STORE SALES PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT THOUSANDS OF CARS PHILADELPHIA FEDERAL RESERVE DISTRICT OUTSIDE 1937 » >Vi 1936 PHILADELPHIA' Y 93 8 1934 .4 4 4 1935 1936 1937 increase, the aggregate volume of con tracts for all classes of construction in the first four months was 3 per cent smaller than a year ago. This was due to substantial declines in awards for residential, commercial and factory buildings, and for public works and utilities. The rise in wholesale prices of build ing materials indicated by an advance in the index of the Bureau of Labor Statistics from 90.6 per cent of the 1926 average in the middle of March to 91.7 at the close of April, was fol lowed by a decrease to 90.4 on May 21. This was 7 per cent below the peak of last year, but 30 per cent above the low reached in 1932. Agriculture. Farm activity in this dis trict is progressing more rapidly than usual. Field work, including plowing, seeding and cultivation, is from ten days to two weeks in advance of a year ago. Dry weather in the first half of May adversely affected grasslands and the development of early crops but widespread rains about the middle of the month relieved this condition. However, cold nights recently have re tarded growth and in a few localities frosts have damaged orchard fruits. Receipts from the sale of farm prod ucts in the three states included in this district were one per cent smaller in the first quarter this year than last, owing principally to lower prices for field crops and a variety of other farm produce. A gain of 6 per cent in inlcome from livestock products, which are of greater importance in this dis trict, was a little more than offset by a decline of 21 per cent in the value of crops sold. Wholesale prices of farm products in the first half of May were at the 1938 JAN TEB MAR, APR lowest level since 1934. In the third week there was a rise in the price in dex of the Bureau of Labor Statistics from 67.4 per cent of the 1926 average to 68.8; this compared with 69.1 a month earlier and 91 a year ago. Distribution, trade and service. Retail trade sales by department, apparel, shoe and credit stores in this district in creased less than was to be expected from March to April and, after allow ance is made for the difference in the date of Easter, they showed a decline of 7 per cent from a year ago. Com paring March and April this year with the same two months of 1937, both periods including the Easter buying season, total dollar sales registered a decrease of 13 per cent. The value of department store sales in Philadelphia was 17 per cent smaller in April this year than last, but elsewhere in this district the decline was only 1 per cent. The sharp recession in the case of the Philadelphia stores reflected in part the adverse influence of a strike of warehouse employees at several large establishments in this city. Wholesale trade sales in eight im portant branches were 19 per cent smaller in April this year than last. Decreases were reported in all lines except shoes and exceeded 30 per cent in the case of dry goods, electrical supplies and jewelry. In the first four months this year dollar sales in the aggregate were 16 per cent less than a year ago. Stocks of goods in both channels of trade declined from March to April. Compared with a year ago, retail in ventories at the end of April were 4 per cent smaller and at wholesale 11 per cent. MAY JUNE JULY AUG SEPT OCT NOV DEC. Sales of new passenger automobiles in this district increased sharply in April, but they were the smallest for that month since 1933. In the first four months this year the number of new units sold was only about 50 per cent of the volume reported a year ago. In the country as a whole manufactur ers’ sales of passenger cars have in creased very little since February and in the case of commercial vehicles there has been a decline. This situation is in marked contrast with the substantial gains which occurred in March and April of the two preceding years. Al though retail financing of new and used automobiles has shown a rising tend ency lately, the increase has not been nearly as pronounced as in the spring of 1937 and several other recent years. Freight car loadings in this section declined in April and were substan tially smaller than a year ago. Total loadings in the first four months this year were about one-third less than in the same period of 1937. The volume of rail freight originating in the Phila delphia industrial area and consisting mainly of manufactures decreased fur ther in April and was the smallest for that month since 1933. Hotel business Philadelphia Federal Reserve District Apr., per cent change from Month Year ago ago 1938 from 4 mos. 1937 +0 Room occupancy.... Per cent of capacity used: Apr. 1938................... 56.5 Mar. 1938................... 58.9 Apr. 1937................... 63.6 Revenue from: Guest rooms............. Food............................... Other sources........... Total revenue... +1 +i - 8 -3 +r - 3 +6 +8 -10 - 7 +0 -2 -0 +7 - 6 -1 Page Five Room occupancy at nonresort com mercial hotels showed some gain in April but a substantial decline as com pared with a year ago. Banking conditions. Member bank reserves were higher in the last half of April than in the first half of the month as a result of substantial expan sion in holdings of Philadelphia banks. Locally there was a small additional gain in May, while reserves of coun try banks declined further. The aver age for all member banks in the first fifteen days of May was $390,700,000, as against $384,500,000 a month earlier. The gain in excess reserves was much larger, from $90,900,000 to $132,900, 000, owing to the reduction in require ments on April 16 this year. Additional indications of the prevail ing ease of the banking situation are given by the small volume of borrow ing by banks and the continuance of substantial balances with correspond ents. Demand balances carried with other domestic banks by country banks of this district on March 4 were nearly three times the amounts reported in the spring of 1929. Reserve balances of member banks (Dollar figures in millions) Held Re quired Ex cess Ratio of excess to re quired Reserve city banks: Apr. 1-15............... $236.9 $183.2 $53.7 Apr. 16-30................ 257.2 163.0 94.2 May 1-15............... 258.8 166.1 92.7 29% 58 ” 56 " Country banks: Apr. 1-15............... Apr. 16-30............... May 1-15............... 34 ” 52 * 44 ” 147.6 139.8 131.9 110.4 92.1 91.7 37.2 47.7 40.2 From a high point of $405,000,000 on April 20 reserves declined to $393, 500,000 on May 18. Net payments of about $9,000,000 in commercial and financial transactions were made to other districts, which the evidence indi cates was due largely to purchases of securities and transfers to correspond ents. Another factor which depleted reserves was an excess of Treasury receipts over local disbursements. This excess, amounting to $4,400,000, was quite small in view of the substantial volume of unemployment insurance funds which the states lodged with the Federal Government for investment and the payment of more than $6, 000,000 to the Treasury for notes of the Commodity Credit Corporation. Currency demand has fluctuated nar rowly since the return flow after the Easter holidays. The sharp recovery in deposits at reporting banks from the low point of $1,314,000,000 in March continued over the greater part of April; these gains Digitized Page Six for FRASER Federal Reserve Bank of Philadelphia (Dollar figures in millions) Changes in— May 18, 1938 Four weeks Bills discounted........... $ 1.5 Bills bought.................... 0.1 Industrial advances. . 3.1 U. S. securities............. 210.5 -$0.2 Total.............................. $215.2 Note circulation.......... 302.8 Member bank deposits 393.5 U. S. general account 48.3 Foreign bank deposits 13.4 Other deposits............... 1.2 Total reserves................ 564.4 Reserve ratio................. 74 .3% -$0.3 - 4.6 -11.5 -1- 2.3 + 0.1 - 0.4 -16.3 - 0.8% 0 - 0.1 0 One year +$0.0 - 0.3 - 1.0 - 2.8 —$4.1 - 9.4 -29.1 +45.9 + i.i - 0.0 +11.0 + 0.6% were maintained in the early weeks of May. On May 18 deposits aggregated $1,387,000,000. An increase of $21, 000,000 in the last four weeks has been due to expansion in demand and in interbank deposits which raised the latter to the highest point of the past year. Reserves of the reporting banks show no increase in this period, but $8,000,000 was added to balances with correspondents. Investments increased $16,000,000 from the low level of a month ago. About $10,000,000 was applied to the purchase of direct and guaranteed obli gations of the United States Govern ment and $6,000,000 to the acquisition of other securities. Loans continued the decline which has been in progress since September. The decrease of $3,000,000 in the past four weeks has been chiefly in commer cial accommodation. On May 18 com mercial loans totaled $201,000,000; this was $23,000,000 or 10 per cent below the peak of early autumn, but slightly greater than a year ago, despite the pronounced contraction in business vol ume which has taken place. Other classes of loans have declined in the past year. The decrease of $21,000,000 in the total was due prin cipally to a shrinkage of $13,000,000 in loans to brokers, dealers and others to purchase or carry securities. The accompanying chart shows the trend of deposits, loans and invest ments of all member banks in this dis trict from 1929 to 1938. Following a Changes in— Reporting member May 18, 1938 (000,000’s omitted) Assets Commercial loans.................. $ Open market paper.............. Loans to brokers, etc........... Other loans to carry secur. Loans on real estate............. Loans to banks....................... Other loans................................ Four weeks One year -* 3 - 1 201 23 16 34 58 1 + 4 9 4% 3 - 2 99 2 +* - 3 Total loans............................ $ 433 -$ 3 —$21 Government securities... . $ Obligations fully guar’teed. Other securities....................... 308 90 267 +$ 6 + 4 + 6 — $39 - 2 - 27 . Total investments............. $ 665 +$16 —$68 Totalloans&investments $1,098 Reserve with F. R. Bank.. 271 Cash in vault........................... 17 Balances w ith other banks 160 Other assets—net.................. 83 +$13 — $89 - 20 + 1 + 25 - 7 Liabilities Demand deposits, adjusted $ Time deposits.......................... U. S. Government deposits Interbank deposits............... Borrowings................................ Other liabilities....................... Capital account...................... 8 + 779 288 +$14 20 300 - 3 + 10 15 227 + 1 1 -$113 + 4 + 13 + 16 - 10 sharp rise from 1933 to the end of 1936, the trend of deposits was down ward to March 4, 1938, the latest date for which complete figures are avail able. This reflected declines in indi vidual and corporate, United States Government and interbank deposits; the contraction was greater in dollars and in percentage at reserve city banks than at country banks. The city banks likewise reported a larger decrease in security holdings, and show a small de cline in loans over this period of four teen months as compared with a small increase at the country banks. Mar. 4, 1938 Philadelphia Federal Reserve District (Millions of dollars) % Changes since 1936 Re Re Coun serve Coun serve try city city try banks banks banks banks Loans.................................. $ Investments: U. S. Govt, obliga tions ........................... Other securities... . 389 $ 552 -$ 351 234 335 418 - 9 +$12 «. 41 + 4 41 - 40 Total loans and in vestments ................ $ 974 $1,305 -$ 91 —$24 Deposits (less cash items in process of collection)............... 1,212 1,407 - 137 - 46 MEMBER BANK RESERVES AND RELATED FACTORS Apr. 27 May 4 May 11 May 18 Changes in four weeks -0.9 -3.8 +0.8 - 2.9 -11.6 - 1.6 + 3.9 +12.0 - 4.5 +2.2 -5.5 +0.9 + 2.3 - 8.9 - 4.4 -3.9 -16.1 +11.4 -2.4 -11.0 Unexpended capital funds............................................. -0.8 -3.5 +0.2 +0.2 + 0.7 -16.5 - 0.1 - 0.2 + 1.4 + 10.5 - 0.5 + 0.0 -0.3 -2.0 +0.0 -0.1 + 1.0 -11.5 - 0,4 - 0.1 Total...................................................................................... -3.9 -16.1 +11.4 -2.4 -11.0 Changes in weeks endingPhiladelphia Federal Reserve District (Millions of dollars) Sources of funds: ... Commercial transfers (chiefly interdistrict).... Treasury operations........................................................... Uses of funds: * * Employment and Payrolls in Pennsylvania MEMBER BANK RESERVES MILLIONS PHILADELPHIA FEDERAL RESERVE DISTRICT (All figures are rounded from original data) Manufacturing Indexes ITOTAL^ Employment* (Indexes are percentages of the 1923-25 average taken as 100. Total and group indexes are weighted proportionately.) EXCESS * 1929 '30 31 '32 '33 '34 35 '36 '37 '38 '39 ALL MEMBER BANKS A. Apr. 1938—■ Per cent Per cent per cent Apr. change from Apr. change from change from 1938 1938 index Apr. Mar. index Apr. Mar. Apr. Mar. 1937 1938 1937 1938 1937 1938 manufacturing...... REQUIRED Employeehours t Payrolls * All Iron, steel and prods.. . . Non-fer. metal prods.. . . Transportation equip.. . . Textiles and clothing... . Textiles................................ Clothing............................... l'ood products...................... Stone, clay and glass. . . . Lumber products................ Chemicals and prods.. . . Leather and products. . . Paper and printing............ Printing................................ Others: Cigars and tobacco. . . Rubber tires, goods. . . Musical instruments. . 73 65 -21 101 49 88 83 109 99 64 44 84 87 94 90 62 75 50 -2 66 -28 -24 -30 -17 -17 -16 - 2 -30 -31 -14 -4 —5 +.T -3 62 103 46 73 70 87 -2 -5 101 - 4 -1 -1 -1 -0 -1 -1 -1 - 7 +t -20 - 8 +2 -1 48 74 41 -11 - 6 55 36 84 76 93 91 -36 -49 -35 -34 -25 -25 -24 + i -43 -38 -24 -18 + - 3 4 -10 - 7 - 4 - 3 -22 -29 - 3 +n -22 -11 6 5 9 8 -12 + 0 + 4 - 1 - 1 -10 -44 -50 -40 -51 -32 -34 -26 - 5 -51 -42 -31 -18 -15 - 0 8 8 -11 - 1 + 2 + o - 2 -12 - 4 - 3 -11 -25 -32 -24 - 4 +n -10 PHILADELPHIA FEDERAL RESERVE DISTRICT MILLIONS * Figures from 2,299 plants. 3 3 5 f Figures from 2,067 plants. 3000 DEPOSITS General Index Numbers 2500 Covering twelve branches of trade and industry 2000 Employment (Indexes are percentages of the 1932 average taken as 100. In dividual indexes are combined proportionately into general in dex number.) LOANS 1500 ♦ Apr. 1938 index Payrolls Per cent change from Apr. 1937 Per cent change from Apr. 1938 index Mar. 1938 Apr. 1937 Mar. 1938 -30 -36 -44 - 3 - 3 -17 -24 + 5 +19 - 2 - 0 + 8 - 2 + 0 1000 General index (weighted)____ 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...................... INVESTMENTS 1929 30 ’31 ’32 * Total leas cash items ’33 34 '35 '36 ’37 ________________________________________________ 104 115 76 -17 101 -14 —35 -24 - 4 + i - 4 - 2 - 0 + i + 3 55 94 152 94 113 117 110 100 107 + -21 -12 132 161 67 127 71 148 167 0 2 4 9 4 +12 - 2 - 1 + 10 - 2 + 0 + 0 + 8 -22 -32 -42 - 2 + 3 - 1 - 2 + 4 + 7 + 17 102 127 115 126 120 139 +31 Percentage change—April, 1938 from April, 1937 City areas* Manufa during Employ ment Allentown................ Altoona..................... Harrisburg.............. 1 Lancaster................. Philadelphia........... Reading.................... Scranton................... Trenton..................... Wilkes-Barre.... Williamsport.......... Wilmington............ Y ork........................... Wage payments -18 -48 -19 -37 -19 -18 -13 -19 -15 -13 - 7 -28 -26 -36 -69 -33 -65 -29 —25 -28 -23 -29 -25 -15 -36 -36 Building permits (value) - 46 - 77 - 73 - 90 - 36 - 66 - 35 +673 + 7 - 70 - 45 - 58 ' - 27 Debits -10 -20 + 3 -27 -16 -19 + 0 -11 -16 -17 -17 + 8 -19 Retail trade sales + 7 -14 + 0 -17 +10 - 8 + 6 + 13 + 5 +14 Trenton.................... Wilkes-Barre.... Williamsport......... Wilmington............ York........................... V - 1 +21 - 1 + 4 3 3 1 6 1 2 1 3 3 + 1 +31 - 4 - 8 — 5 - 6 - 7 - 6 + 0 - 3 - 1 - 6 - 1 + + + + - + + + + 50 1 22 11 73 19 53 63 72 21 22 52 33 + + + - 9 3 — + + 5 1 2 1 6 +10 8 3 5 2 4 PENNSYLVANIA 12 MANUFACTURING AND NON - MANUFACTURING INDUSTRIES AND SERVICES PERCENT 1932 AVG = I00 200 \ VV +15 / 150 +25 — 7 + 12 +18 +23 +30 +38 +27 125 A • • 1 1 V* A1 /"V +41 -10 + 6 /***». PAYROLLS 175 April, 1938 from March, 1938 Allentown................ Altoona..................... Harrisburg.............. Johnstown............... Lancaster................ Philadelphia........... Reading.................... INDUSTRIAL EMPLOYMENT AND PAYROLLS 100 EMPLOY MENT **/ 75 r 50 1933 1934 1935 1936 1937 ....................... 1938 * Area not restricted to the corporate limits of cities given here. Page Seven OUTPUT OF MANUFACTURES PHILADELPHIA FEDERAL RESERVE DISTRICT Index numbers of individual lines of trade and manufacture Philadelphia Federal Reserve District Index numbers: percentages of the 1923-1925 average as 100 Adjusted for seasonal variation seasonal change in activity. Not adjusted % Per cent change Unadjusted indexes reflect merely the actual change which may or may not Apr. Feb. Mar Apr. be typical. 1937 1938 1938 1938 April 1938 from Month Year ago ago 1938 from 4 mos. 1937 Apr. 1937 Feb. Mar 1938 1938 Apr. 1938 * Retail trade 78 68 67 92 68 104 76 72 65 100 70 78 75 72p 69 61 58 65p 91 100 67 88 91 r 83p - 3 - 7 -11 +10 -11 - 2 + 8 +31 - 8 +29 -19 2 - 4 3 -12 -10 +13 80 r -10 70r -10 64 -10 - 6 108 74 - 2 -13 100 59 55 53 74 53 70 80p 59 66 51 69p 98 125 62 103 76 r 87p 83 63r 114 79 108 75 53 80 57 101 112 67 104 76 107 66 Stocks of goods 80 r 78 60 r 56 106 107 77 72 108 106 78 55 102 75 105 77p 53 96 75 106p — + + 6 0 0 - 3 - 2 79p 55 103 77 106p * Rate of stock turnover - 3* 1.23 1.19 Wholesale trade Sales — 3* — 19* + 2* + 4* -10* - 1* - 7* + 7* + 3* - 2* +20* - 3* -33* -32* -10* -29* —35* -29* — — — — - 2* -11* — 12* - 6* -22* _ 4* -16* + 7* -27* + + + + + 6 1 8 — 16* —15* _ 4* -31* -29* — 6* -28* -31* -26* 98 78 82 79 79 72 72 70 83 107 91 125 35 50 42 * Stocks of goods Output of manufactures 73 44 247 33 47 41 59 81 18 52 26 258 101 68 76 63 152 106 160 69 67 37 36 32 47 79 102 88 122 140 25 68 102 74 110 76 100 167 121 94 95 152 129 101 23 29 22 89 46 55 89 64 92 150 74 83 73 143 78 25 48 41 42 75 15 47 26 48 45 44 75 14 41 21 19 246 233 73 74 38 33 35r 32 58 52 87 84 108 116 48 44p 25r 24 23 24 90 69 56 95 65 91 162 76 77 71 137 77 DigitizedPage Eight for FRASER 4 1 - 1 -12 - 9 - 5 + 2 -13 - 8 -10 + + 83 75 56p 91 + — - 62 89 163 77p 74 70 141p 72 + + + - * Computed from data unadjusted for seasonal variation. 7* 2* 1* 1* 2* 3* 3* 3 7 7 5 7 -64 -53 -49 -64 -46 -43 -40 -56 - 5 -26 -57 -50 -66 -20 5 -28 -36 -65 -35 - 3* -18 + 1 -14 -18 5 -18 2 o -11 - 2 2* 7 9 1 -57 -51 -47 -54 -38 -31 -32 -44 + 3 -33 -59 -48 -71 -29 -31 -43 -33 - 3* -10 -10 -11 122 32 74 47 251 99 70 65 143 106 157 68 70 35 88 100 96 100 -16 -16 - 7 102 77 1 -36 4 -21 -31 -13 167 117 95 2 -26 - 8 -44 -22 100 - 7 -40 152 134 3 6 p—Preliminary. 29 30 51 51 44 47 47 45 66 78 69 19 16 18 56 51 45 27 23 21 253 255 238 72 75 73 37 37 31 35 37 33 48 58 50 82 91 84 118 114 110 16 37 44p 28 24 r 25 23 21 22 87 87 85 90 82 86 59 105 97 51 50 49p 75 83 88 64 67 63 92 93 91 157 172 163 80 75 75p 83 77 75 72 73r 74 141 136 141p 82 80 75 GOAT AND KID LEATHER r—Revised. ■#
@FedFRASER