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THE BUSINESS REVIEW THIRD FEDERAL PHILADELPHIA RESERVE DISTRICT MAY i, 1939 FEDERAL RESERVE BANK OF PHILADELPHIA Business and Banking Conditions in the United States In April manufacturing production was maintained at about the same rate as in March but mineral production declined, reflecting a sharp reduction in output of bituminous coal pending settlement of negotiations between op erators and miners. In the first quar ter of this year industrial output, after a rapid rise in the latter half of 1938, increased less than is usual at this season. Production. Volume of industrial production showed little change in March and the Board’s seasonally ad justed index remained at 98 per cent of the 1923-1925 average. The index for the first quarter averaged 99, com pared with 101 in the final quarter of last year. Activity at steel mills in March was at 54 per cent of capacity, a slightly higher level than in January and February. Automobile production increased less than seasonally; retail sales of cars continued to fluctuate around a level considerably higher than last year but lower than in 1936 and 1937. Dealers’ stocks of new cars began to decline in March, following an increase to a seasonally high level. MANUFACTURING PRODUCTION Index of physical volume of production, ad justed for seasonal variation, 1923-1925 aver age = 100. Durable and nondurable series ex pressed in terms of points in the total index. By months, January 1934 to March 1939. Activity in the machinery industries increased further in March, continu ing the rise that began last summer. Lumber production increased less than seasonally from the relatively low level of other recent months. Production of nondurable goods in March continued at about the level that has prevailed since last autumn. In the woolen textile industry activity showed a decrease from the high level of recent months, while at cotton mills and shoe factories output was main tained in large volume. At meat packing establishments and sugar re fineries increases in activity were reported, following earlier declines. Value of construction contract awards increased in March, according to F. W. Dodge Corporation figures, reflecting a seasonal rise in residential and other private building. Awards for public projects showed little change. In the first three weeks of April bituminous coal production declined to a low level as most mines were dosed, pending the settlement of biennial con tract negotiations between mine opwholesale prices Index compiled by the United States Bureau of Labor Statistics. By weeks, 1934 to week ending April 15, 1939. erators and workers. Steel ingot pro duction was reduced somewhat, averaging about 52 per cent of ca pacity, and automobile production showed little change from the rate reached in the latter part of March. Distribution. Sales at department stores and mail order houses increased somewhat more than seasonally in March, while variety store sales showed about the usual rise. For the first quarter as a whole retail sales were in about the same volume as in EXCESS RESERVES OF MEMBER BANKS Wednesday figures of estimated excess re serves for all member banks and for selected New York City banks, January 3, 1934 to April 19, 1939. MEMBER BANKS IN 101 LEADING CITIES Wednesday figures for reporting member banks in 101 leading cities, September 5, 1934, to April 19, 1939. Commercial loans, which include industrial and agricultural loans, represent, prior to May 19, 1937, so-called “Other loans" as then reported. Page One the final quarter of 1938, after allow ance for seasonal changes. Freight car loadings showed less than the customary advance from Feb ruary to March as loadings of coal declined and shipments of miscellane ous freight increased less than season ally. In the first half of April there was a marked decrease in freight traf fic, reflecting in large part a sharp decline in coal shipments. Commodity prices. Prices of steel scrap, copper, hides, and some other industrial raw materials declined from the middle of March to the third week of April, and there were decreases also in prices of livestock and dairy prod ucts. Silk prices rose considerably. The general level of wholesale prices, as measured by the index of the Bureau of Labor Statistics, declined to 76 per cent of the 1926 average as compared with 77 in the middle of March and at the beginning of the year. Bank credit. Reflecting continued heavy gold imports and Treasury dis bursements from its balances at the reserve banks, member bank reserves and deposits increased sharply during the four weeks ending April 19. Ex cess reserves rose to a record high level of $4,000,000,000. Total loans and investments at banks in 101 lead ing cities, which had shown little change during March, increased some what during the first three weeks of April, reflecting principally continued purchases of United States Govern ment obligations by New York City banks. Loans to brokers and dealers in securities declined. Money rates and security prices. Prices of government bonds and of other bonds of highest grades con tinued firm at high levels during March and the first three weeks of April, while prices of the lower-grade corporate bonds and of corporate stocks declined. The average discount rate on new issues of 91-day Treasury bills continued at a low level and other open market rates remained un changed. Business and Banking Conditions in the Philadelphia Federal Reserve District Industrial production in the Third Federal Reserve District expanded almost steadily from the middle of last year through March of this year, the adjusted index rising from 68 to 79. The change from February to March was slightly more favorable than usual, although the earlier expec tations of substantial improvement in industrial activity so far have not materialized. Preliminary reports in dicate some contraction in April re sulting principally from unsettled con ditions at home and abroad. The rate of production in the first quarter of this year was 12 per cent higher than in the same quarter last year, virtually all branches of industry in this district sharing in this expan sion. Employment and wage disburse ments also show a favorable compari son with the levels in the first quarter of last year. The volume of building contracts awarded for residential buildings as well as public works and utilities has been substantially larger than in the first quarter last year, while awards for non-residential construction have been smaller. Construction activity during April in the aggregate shows a further expansion. Retail trade sales in the first quarter exceeded the dollar volume of a year ago. The sharp gain in March and the first week of April over a year ago was due chiefly to the earlier occur rence of Easter this year than last. Activity in wholesale lines also has been greater than last year. The value of inventories at retail and wholesale establishments at the end of March MANUFACTURING ACTIVITY was smaller than on the same date last year. Prices of staple industrial com modities increased in March but sub sequently declined, reflecting lower quotations on metals and hides. Rub ber prices have been fairly steady, while silk again advanced sharply. In the agricultural group, price fluctua tions continued narrow. The general level of wholesale prices, as measured by the index of the United States Bureau of Labor Statistics, declined from 77.0 on March 11 to 75.8 in the week ended April 15; a year ago this index was 78.6. Manufacturing. The market for manufactured goods, particularly tex tiles, has slackened, owing in part to the customary seasonal let-down. As partly indicated by current inquiries l VALUE OF BUILDING CONTRACTS AWARDED PHILADELPHIA FEDERAL RESERVE DISTRICT PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT PRICES OF BUILDING MATERIALS (1926 »ioo) PRODUCTION (adj. TOR SEAS, variation) EMPLOYMENT NON-RESIDENTIAL PAYROLLS RESIDENTIAL CONTRACTS ADJ. FOR SEAS. VARIATION 1933 1934 1935 Page Two 1936 1937 1938 1939 1934 1935 1936 1923-25-100 (3months moving avg.) 1937 1938 1939 and by the volume of unfilled orders, the earlier expectations of continued improvement thus far have not materi alized. The striking exception is a marked expansion in the demand for building materials, reflecting princi pally the usual spring activity in build ing and construction. Backlogs have been reduced in many important lines and in certain cases are smaller than those on hand at the same time last year. Operations also have shown some tendency to decline and no longer register a uniformly favorable comparison with 1938. In scattered instances some production for stock appears to have occurred. Supplies of raw materials are still comparatively low but here also the decline seems to be leveling off as production is slowing down. Prices of manufactured goods con tinue weak and in practically all lines are lower than last year at this time. The market in this respect apparently continues unsettled. Factory employment in this district in April, according to preliminary reports, showed practically no change from the month before, while payrolls declined slightly more than was to be expected. The sharpest loss appears to have occurred in the case of textile and clothing mills. In March, both employment and wage payments showed some improvement, the actual gains being about 1 per cent and 2 per cent respectively. In comparison with a year ago, employment was 3 per cent and payrolls 13 per cent higher. At Pennsylvania factories, employ ment increased fractionally from Feb ruary to March and payrolls rose over 1 per cent. The index of wage pay ments was approximately 78 per cent of the 1923-25 average, the highest since November 1937. Except for a small decline in January, the index advanced steadily for eight months and by March was about 27 per cent above the 1938 low last July. Increases were reported in March by all major industry groups, with the exception of textiles other than cloth ing, where there was a seasonal de cline. Wages paid by producers of fabricated metals and transportation equipment were maintained at the usual levels, while most other lines showed substantial improvement. At plants manufacturing leather and lum ber products and at paper and printing establishments, where there is cus tomarily a contraction at this time of year, there were increases, and in Business Indicators Philadelphia Federal Reserve District Index numbers: percentages of the 1923-1925 average as 100 Per cent chs nge Unadjusted indexes reflect merely the actual change which may or may not Mar. Jan. Feb. Mar. be typical. 1938 1939 1939 1939 Mar. 1939 fro m Month Year ago ago Industrial production.............. Manufacturing—total....................... Metal products............................... Textile products............................. Transportation equipment.......... Food products................................. Tobacco and products.................. Building materials......................... Chemicals and products............... Leather and products.................... Paper and printing........................ Coal mining......................................... Anthracite........................................ Bituminous...................................... Crude oil............................................... Electric power Sales to industries!....................... 77 r 77 71 66 r 74 r 75 58 r 65 68 83 85 54 63 62 63 80 r 82 57 r 69 71 74 76 75 97 88 104 30 29 35 102 114 111 118 109 110 87 84 86 66 68 61 68 69 61 61 50 57 488 426 414 79p 77p 68p 88p 63* 86p 71 77p 101 36 104p 118p 86 61p 61p 65 418 + + 229 246 247 224 249 248 148 175 177 253 248 165 Distribution 46 82 69 51 21 51 70 80 69 87 116 119 18 14 43 45 47 43 317 214 318 73 r 80 r 80 81r 76 77 59 50 60 105 21 44 249 2 0 7 + ii + 10 + 12 85 77 Freight-car loadings—total............. Merchandise and miscellaneous. Coal.................................................... 55 55 53 60 60 60 62 63 64 64 64 63 444+ + + Business liquidations 2 0 7* 6* 9 33* 3* 4* 3 4 7 49* 4+183* 76 82 34 r 30 82 31 ii 15 18 16 16 35 23 4 5 18 2 0 1 7 10 31 14 84 + 2 + 12 34 Prices—United States _ _ _ + Scranton........................................... - 1939 from 3 mos. 1938 55 66 61 r 73 89 27 102 122 88 55 56 51 498 + 11 + 11 + 14 233 261 262 222 257 268 141 169 175 1* 13* 14* 75 68 58 61 82r 69 75 73 25 111 113 84 73 74 65 409 79p 78p 63 64 88 89p 72 75 74 76p 88 93 29 r 31 110 104p 117 122p 86 87 66 52 p 66 50p 66 67 414 426 75 73 64 76 77 r 67 258 245 157 77 78 68 2* 104 101 103 7* 136 142 146 104 147 43 64 56 41 39 21 65 73 59 57 110 97 17 24 14 43 50 46 323 246 324 55 48 56 69 26 41 254 27 + +135 14 — 21 + + 81 — 212 67 r 58 59 83 r 70 r 75 7 op 79p 83 113 98 19 47* 67 73 81 5* 126 116 118 129 133 4* 130 51 57 56 14 53 55 55 14 17 51 68 65 86 107 120p 127p 59 61 62 + + 3 + — + 5 - + + 6* _ 2* _ 14 + 15 + 22 + + + + 70 r 76 79 67 r 73 r 76 12 15 13 18 9 45 15 2 6 26 2 2 2 4 + 2 + + 25 — 17 3* 4+ 13* + + 17* + - 0* — + 8* 4- 8 4 5* 6* + 4 + 59* Mar. Jan. Feb. Mar. 1938 1939 1939 1939 + + + + + + + + + + + + — + 27 — IS1 + +135 — 13 - 14 — 12 4- 20 — + 17 + 52 + 2 - 3 22 - 21 4- 75 127 Check payments................................. Rate of collections (actual) + — — 78p 77p — _ Life insurance sales..................... Payment of accounts + + + + + + + + + + + + + + + - + 0* + 1* + 2* + 1* + X* Man-hours (1927-28 =100)......... General (1932=100) Public works and utilities!.......... Permits for building—17 cities.... Real estate deeds—Philadelphia! . Writs for Sheriff sales—Phila....... + + + — + — + — + — 2 2 0 3 1 5 0 3 2 3 7 7 1 1 0 8 1 4- Employment and wages—Pa. Building and real estate Contracts awardedf—total............. Residentialf..................................... Nonresidentialf ............................ Not adjusted Adjusted for seasonal variation Adjusted indexes allow for the usual seasonal change in activity. + 45* — 7* - 5* _ 12* 89 r 95 96 r 22 86 32 + ii 75 84 83 82 31 35 30 33 80 70 73 83 79 80 75 77 67 71 80 77 78 74 77 77 66 70 + 6 4* 2 0* _ 2* — 2* _ 0* 1* 0* 1* - 4* — 6* _ 4* 3* _ _ 3* _ 3* _ 3* — 4* 5* 5* 3* 3* 3* 2* 67 71 80 77 78 74 129 91 80 76 78 73 % change from (In millions of dollars) Mar, 1938 Dec. 1938 Jan. 1939 Feb. 1939 Mar. 1939 Month ago Year ago -58 0 + 2 + 1 -74 - 3 +ii + 7 + 1 - 1 0 - 1 - 8 +10 + 9 -14 Banking and credit Federal Reserve Bank 0.5 1.2 $ 1.2 $ Bills discounted........ . ..................$ 1.9 % 1.4 $ 209 209 210 Other bills and securities............. 226 215 410 401 401 366 Member bank reserves................. 368 77.3 76.7 Reserve ratio (per cent)............... 72.4 72.9 76.0 Reporting member banks 407 * 411 409 8 415 $ Loans............................................. . $ 448 $ 723 719 723 724 Investments..................................... 652 1,455 Deposits (a)..................................... 1,428 1,457 1,455 1,333 io.9 tl.2 9.7 9.6 10.0 Bankers’ acceptances outstanding. * Computed from data unadjusted for seasonal variation. t 3-month moving daily average centered at 3rd month. t Not included in production index. p—Preliminary. r—Revised, (a) Less cash items in process of collection, Page Three METAL PRICES TEXTILE FIBERS PERCENT 1932 -33AVC *100 MILLIONS OF LBS. DOLLARS PER. LB UNITED STATES MILL TAKINGS PRICES 400 350 250 300 STEEL SCR AP COTTON COTTON 250 200 40 30 COPPER \ xo 20 150 ->F INISHED STEEL WOOL 6 d v/x 5 100 4 silk 3 50 jys/siLi 2 ________________ 1936 i'.__________ 1937 1938 such other lines as nonferrous metal products, clothing, foods, chemicals, and certain building materials the gains from February to March were greater than usual. In Delaware factories, employment increased 1 per cent and payrolls nearly 3 per cent, the sharpest gains being reported by plants producing building materials. Employment in southern New Jersey was at about the same level as in February but wage payments increased 3 per cent. The earnings of factory workers in Pennsylvania increased slightly in March from $24.53 to $24.74 a week. Hourly earnings were unchanged at 69 cents, while average working time increased fractionally from 35.7 to 35.9 hours a week. Production of manufactured goods in this district increased approximately 2 per cent in March, so that the sea sonally adjusted index advanced to 77 per cent of the 1923-25 average, the highest level since October 1937. Ex cept for a fractional decline last Octo ber and the customary year-end con traction in January, production has been increasing since the low of last June. The adjusted index in these nine months advanced 20 per cent and reached a level more than 15 per cent above a year ago. The latest improvement was due to a 3 per cent rise in the output of con sumers’ goods. The sharpest gains during March occurred in the output of foodstuffs, footwear, and certain textiles, especially carpets and rugs where productive activity is 150 per cent above a year ago. Production of durable goods, which was expected to lead the advance in business activity this spring, was un Page Four 19 3 9 Source Iron Age 1936 1937 changed in March, following a marked improvement in February and for a time last fall. Manufacturers of build ing materials, however, reported sub stantial improvement. The greatest declines among individual products were in the output of pig iron, steel castings, and locomotives and cars. In the case of both pig iron and steel castings, production is about 50 per cent above March 1938. The output of electric power de clined less than it usually does from February to March. Industrial con sumption o\ electrical energy declined sharply from the high level in Febru ary, but was 12 per cent higher than a year ago. Coal and other fuels. Demand for an thracite has improved since the cus tomary reduction in prices of domestic sizes became effective early last month. Colliery output and shipments showed substantial seasonal gains during the first half of April, following the usual declines from February to March. Production and shipments in the first quarter of the year were about 2 per cent larger than in 1938. Production of bituminous coal has been drastically curtailed as virtually all mines in this section have been forced to suspend operations, pending settlement of disputes between opera tors and miners over a renewal of their working agreement. Output in the country during the week ended April 8 declined to less than 2,000,000 tons as compared with over 7,000,000 tons in the previous week and an aver age of close to 8,000,000 tons a week in the first quarter of this year. Ap parently in anticipation of this develop ment, production of this fuel in Penn 1938 1939 1936 1937 1938 1939 sylvania increased between January and the first week of April and was much larger than in the same period last year. Reports indicate consider able anxiety on the part of large con sumers with respect to the supply of bituminous fuel if the present negotia tions are greatly prolonged. Production of by-product coke showed little change in March, when there usually is some decline, and in the first three months was about 25 per cent larger than in 1938. Output of gas and fuel oils decreased sharply as compared with February, and in the first quarter of 1939 was 3 per cent less than a year ago. Building. Awards of building con tracts in this district more than doubled from February to March, aggregating $18,136,000 or nearly 40 per cent more than a year earlier. Contracts let for all types of construction showed sub stantial increases in the month, and pronounced gains over a year ago were reported in residential buildings and public works and utilities. Awards for residences in March were the great est since April 1930. Building contracts Philadelphia Federal Reserve District Per cent change March 1939 1939 (000’s From from omitted) month 3 mos. ago 1938 Residential...................... $ 8,354 Apts, and hotels......... 3,025 Family houses............. 5,329 Nonresidential................ 7,096 Commercial.................. 759 Factories....................... 745 Educational.................. 1,060 All other........................ 4,532 + 89 +672 + 32 +212 + 25 +141 +145 +389 +135 +427 + 92 - 14 + 18 + 62 - 74 + 22 Total buildings........ $15,450 Public works and utilities.................................. 2,686 +131 + 29 + 44 + 21 Grand total............... $18,136 +112 + 27 Source: F. W. Dodge Corporation. RETAIL TRADE FREIGHT CAR LOADINGS PHILADELPHIA FEDERAL RESERVE DISTRICT ALLEGHENY PERCENT DISTRICT PERCENT SALES 1923 -23AVC.-IOO IOO COAL ftyTOT/ /b 50 &A * MERCK ANDISE Al> D MISC.ELLANE0 US ■STOCKS 25 1 1933 1934 1935 1936 1937 111 the first three months of this year about $41,000,000 of construction work was let, or about the same as in the corresponding period of 1937, which was the best first quarter since 1931. Awards for all types of construction except educational buildings have been substantially greater this year than last, the increases being especially large in the case of family houses and apartments and hotels. Wholesale prices of building ma terials have declined slightly in the first half of April, after having shown firmness during several preceding weeks. The price index of the Bu reau of Labor Statistics in the week ended April 15 was 89.7 per cent of the 1926 average, compared with 90.2 four weeks earlier and 91.1 a year ago. Agriculture. Plowing and seeding on farms in this district have been delayed this year by the unusually heavy rainfall and continued low tem peratures over the greater part of April. In some sections the planting of early truck crops such as white potatoes, onions and peas is from ten days to two weeks late. In southern New Jersey and Dela ware the outlook for orchard fruits is more favorable than in the early spring of 1938, according to reports from the county agents. The Department of Agriculture estimates that the condi tion of winter grains and pastures in this district on April 1 was approxi mately the same as a year ago, but substantially above the 1928-37 aver age. Stocks of wheat and corn on farms at the beginning of April were smaller than a year earlier, when the carry-over was unusually large. Farm cash income in Pennsylvania, New Jersey and Delaware decreased 1938 1939 o ADJUSTED TOR SEASON AL VARIATIO 1933 1934 in February, according to the latest government reports, following a small gain immediately after the turn of the year. Receipts from the sale of crops were fairly well sustained, but there was a decline in the value of livestock products marketed, reflecting chiefly lower prices. Distribution, trade and service. Retail sales expanded sharply from the mid dle of March through the first week of April, reflecting the customary expan sion during the Easter season. In the subsequent weeks business de clined, as was to be expected. Sales in the Easter buying period this year were about the same as a year ago, the dollar volume of trade reported by a group of representative stores for the four weeks ended April 15 show ing practically no change from the corresponding period in 1938. Retail trade sales during March were substantially higher than a month earlier, owing to usual seasonal tend encies and to the fact that Easter was a week earlier this year than last. The expansion in both February and March, however, was slightly less than was to be expected, so that the seasonally adjusted index declined from an eleven-month high of 80 per cent of the 1923-25 average in January to 78 per cent in March. Department stores alone showed improvement in the latest period, adjusted sales in creasing 4 per cent as against declines at other types of reporting establish ments ranging from 1 to 7 per cent. Compared with a year ago, sales in March showed substantial increases at all types of reporting stores, even after allowing for the difference in the date of Easter. In the first quarter of this year aggregate sales were up 3 1935 1936 1937 1938 1939 per cent from 1938 levels, gains being reported in all lines except women’s apparel. Inventories at retail establishments increased somewhat further from Feb ruary to March, reflecting customary spring buying. Compared with a year ago, inventories generally were about 4 per cent smaller. Sales at wholesale in March were 7 per cent larger than a month earlier, owing chiefly to marked gains in re tailers’ seasonal purchases of foot wear, electrical supplies, and hardware. Sales of groceries were about the same as in February while drugs de clined somewhat. Compared with 1938 wholesale business in March and in the first quarter showed an increase of 5 per cent. Inventories at whole sale establishments increased season ally from February to March, but were 6 per cent smaller than a year earlier. Shipments of freight by rail in the Allegheny district increased some what from February to March, after allowing for seasonal changes. The index, however, failed to regain the high of 64 per cent of the 1923-25 average reached in January, which represented the culmination of an eight-month advance from a low of 49 in May of last year. In early April coal loadings declined abruptly, owing to labor difficulties in the Appalachian bituminous district. The volume of rail freight ship ments originating in the Philadelphia area has increased almost steadily from a six-months’ low of 7,656 cars in the last week of December to 10,693 cars in the week ended April 15. In the first quarter of 1939 car loadings in this area totaled approximately 121,400 or about 9 per cent more than in the first quarter last year. Page Five Registrations of new passenger auto mobiles in this district increased sub stantially from February to March, reflecting the usual spring upturn in sales. Although the expansion was less than had been anticipated, registra tions in March were about 60 per cent higher than a year ago, and for the entire first quarter the increase from 1938 levels was nearly 50 per cent. Total revenue of nonresort hotels in March declined 4 per cent from Feb ruary and showed the same reduction from 1938 for the first quarter as a whole. Hotel business Philadelphia Federal Reserve District Room occupancy.................... Per cent of capacity used: March 1939............. 53.Op Feb. 1939.............. 65.4 March 1938.............. 58.9 Revenue from: Guest rooms........................ Food....................................... Other sources...................... Total revenue.................. Mar.: per cent change from 1939 Month Year ago ago 3 mos. 1938 4- o + 3 + 1 - 6 -10 - 4 -0 -6 -7 -0 -5 -7 -3 +3 -1 -2 -4 The reserves of member banks in this district on April 19 were the largest ever reported on a statement date and $53,400,000 greater than a year ago. Increase of $46,000, 000 in the four latest weeks to $458, 400,000 has resulted chiefly from net Treasury disbursements of $31,000,000, and the receipt of over $16,000,000 through the settlements with other dis tricts. A slight increase in currency demand was an offsetting factor, the seasonal rise over the Easter holidays not being entirely offset by the subse quent return of money from circula tion. In the first half of April, when re serves averaged $429,100,000, the ex cess over requirements was $157, 300,000 or 58 per cent. The propor tions at both Philadelphia banks and country banks were 58 per cent, as compared to 47 and 56 per cent re spectively a month earlier. Banking conditions. Member bank reserves (Dollar figures in millions) Reserve city banks: 1939—Mar. 1-15 Mar. 16-31 Apr. 1-15 1938—Apr. 1-15 Country banks: 1939—Mar. 1-15 Mar. 16-31 Apr. 1-15 1938—Apr. 1-15 Held Ex Re quired cess $258.0 $175.3 $82.7 264.6 175.4 89.2 278.7 176.5 102.2 236.9 183.2 53.7 149.0 148.3 150.4 147.6 95.3 95.4 95.3 110.4 53.7 52.9 55.1 37.2 Ratio of excess to re quired 47% 51 ” 58 » 29 " 56 55 58 34 * " * * Reporting member banks show sub stantial increases in their reserves and Page Six Federal Reserve April 19, 1939 Bank of Philadelphia (Dollar figures in millions) $ Industrial advances .. 0.2 0.1 2.8 206.9 $210.0 Note circulation......... 312.6 Member bank deposits 458.4 U. S. general account. 44.4 Foreign bank deposits 21.5 6.2 655.1 77.7% Changes in— Four weeks Reporting member -$0.0 + 0.0 - 0.1 + 1.0 -$ + - 1.6 0.0 0.4 3.6 +$0.9 + 0.4 +46.0 -30.8 - 1.2 + 1.3 +14.1 + 0.2% -$ 5.6 + 5.3 + 53.4 - 1.5 + 8.2 + 4.6 + 74.5 + 2.6% balances with correspondents in the four weeks to April 19. This was due principally to an expansion of $43,000, 000 in deposits arising partly out of government expenditures in the period. Aggregate deposits of $1,497,000,000 at the close were the largest held in over two years and little under the record established at the beginning of 1937. Recent gains have been dis tributed over several categories—de posits of individuals and corporations, of states and political subdivisions, and balances to the credit of other banks. The increase in reserves also re flected the sale of $19,000,000 of investments. In the first quarter, hold ings of direct and guaranteed obliga tions of the Federal government had been quite steady at an average level of over $450,000,000, but in the last four weeks there has been a decline of $15,000,000 to the lowest point in 1939. The trend of the investment in cor porate and municipal securities has been generally downward since No vember, the decrease in the latest pe riod being $4,000,000. Commercial loans show a further increase of $7,000,000 since March 22, continuing the expansion that has been in progress since early February, but remain 5 per cent smaller than a year ago. Recent increases have been dis tinctly at variance with a slight decline in the corresponding period of 1938 and parallel more closely 1936 and Changes in— April 19, 1939 hanks One year (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............................... Total loans, $ Government securities.......... $ Obligations fully guaranteed Other securities....................... Four One weeks year +$ 7 191 23 21 32 52 - *2 1 92 - -$11 + 1 5 412 1 5 2 2 -$12 352 92 258 —$13 2 - 4 702 —$19 +$63 Total loans & investments $1,114 Reserve with F. R. Bank ... 322 Cash in vault........................... 17 Balances with other banks. . 176 Other assets—net................... 103 —$19 + 47 +$51 + 51 + 14 2 + 24 +$28 +$52 - 4 + 30 + 53 Total investments............... $ Liabilities Demand deposits, adjusted . $ Time deposits........................... U. S. Government deposits.. Interbank deposits.................. Borrowings..................................... Other liabilities........................ Capital account....................... +$50 + + - 817 284 53 343 + 1 13 222 - "3‘ - + 14 6 7 2 3 4 1937, when the trend was upward dur ing March and part of April. This expansion, however, was offset by de clines in other types of credit, includ ing brokers’ loans, so that total loans have shown no net change. Total current earnings of all mem ber banks in this district declined from $110,900,000 in 1937 to $108,400,000 in 1938, according to a study of operat ing results just completed by this bank. Current expenses were more than cor respondingly reduced, owing chiefly to smaller amounts of interest paid on deposits and to lower tax payments resulting from losses and depreciation. Net earnings from current operations, therefore, increased from $34,500,000 to $35,300,000. Recoveries on assets previously charged off were not equal to the amounts realized in 1937 and losses and depreciation, particularly on investments, increased sharply. Net profits available for distribution de clined from $23,500,000 in 1937 to $10,000,000 in 1938. MEMBER BANK RESERVES AND RELATED FACTORS Changes in weeks ending— Mar. 29 Apr. 5 Apr. 12 Apr. 19 Changes in four weeks Sources of funds: Reserve bank credit extended in district........................... Commercial transfers (chiefly interdistrict)...................... Treasury operations................................................................. +0.9 -2.5 +2.3 + 0.1 + 9.4 + 7.6 + 0.7 + 3.1 +10.1 - 1.2 + 6.6 +11.3 + 0.5 +16.6 +31.3 Philadelphia Federal Reserve District (Millions of dollars) Total........................................................................................ +0.7 +17.1 +13.9 +16.7 +48.4 Uses of funds: Currency demand..................................................................... Member bank reserve deposits............................................. "Other deposits” at reserve bank........................................ Unexpended capital funds...................................................... +0.1 +0.6 -0.0 +0.0 + 5.3 +11.9 - 0.0 - 0.1 - 1.7 +15.4 + 0.2 - 0.0 - 2.6 +18.1 + i.i + 0.1 + i.i +46.0 + 1.3 - 0.0 Total........................................................................................ +0.7 +17.1 +13.9 +16.7 +48.4 Employment and Payrolls in Pennsylvania COMMERCIAL LOANS REPORTING MEMBER BANKS PHILA. FED. RES. DIST MILLIONS (All figures are rounded from original data) Manufacturing Indexes 1938 Employeehoursf Payrolls* Employment* (Indexes are percentages of the 1923-25 average Per cent Per cent taken as 100. Total and change from group indexes are weight Mar. change from Mar. 1939 1939 ed proportionately.) index Feb. Mar. index Feb. Mar. 1939 1938 1939 1938 All manufacturing. . .. ►Met~*AII ofher" loans up to May 1^,1937 INVESTMENTS AND EXCESS RESERVES PHILADELPHIA FEDERAL RESERVE DISTRICT MILLIONS 77 + 0 + 3 Iron, steel and products . 67 + 1 - 1 Non-ferrous metal prods. 104 + 2 - 2 Transportation equip.. . . 54 + 1 +n Textiles and clothing.... 97 - 1 + 7 Textiles........................... 92 - 1 + 8 Clothing.......................... 120 + 2 + 4 Fdod products................... 101 + 9 + 1 Stone, clay and glass .... 67 + 2 + 5 Lumber products.............. 52 + 1 +10 Chemicals and products . 83 + 3 - 1 Leather and products___ 95 + 1 + 9 Paper and printing........... 95 + 1 + 0 Printing........................... 89 + 1 - 3 Others: Cigars and tobacco... . 51 -16 -17 Rubber tires, goods. . . 81 +1 +i(» Musical instruments . . 57 + 2 +14 1939 REPORTING MEMBER BANKS * Figures from 2262 plants. 78 +1 + 2 +3 +4 - 2 - 3 + 4 + 2 76 119 56 88 83 111 104 66 97 42 94 58 -11 + 6 + 2 96 100 Feb. Mar. 1939 1938 +13 +17 + 9 +25 +9 + 9 + + -16 -12 + 2 2 2 + 3 + 4 - 2 - 3 +12 + 3 + 4 + 1 5 +24 + 7 3 +15 + 2 7 + 6 4 + 2 + 13 + 3 3 + 4 + 2 4 + 3 + 1 + + + + + + 43 90 Mar. 1939— per cent change from +41 +27 + 17 + 18 + 14 +42 +17 +19 + 9 + 3 +26 + 8 + 7 + 9 + 2 - 3 -19 +36 + 1 +24 t Figures from 2038 plants. General Index Numbers U. S. GOVERNMENT OBLIGATIONS Covering twelve branches of trade and industry OTHER SECURITIES RESERVE CITY BANKS EXCESS RESERVES I 936 193 7 19 3 8 Percentage change-—March 1939 from March 1938 City areas* Payrolls Employment (Indexes are percentages of the 1932 average taken as 100. In dividual indexes are combined proportionately into general in dex number.) 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................... Mar. 1939 index 104 121 68 102 48 90 132 91 106 115 109 95 93 Per cent change from Feb. 1939 Mar. 1938 + i + 0 - 3 - 1 + 4 +10 + 1 - 1 + 5 - 3 + 0 + 1 + 2 - 0 + 3 -14 - 8 -10 + 7 -15 - 4 + 2 - 3 - 0 - 5 - 7 Per cent change from Mar. 1939 index 147 189 58 198 62 156 161 100 119 116 124 118 109 Feb. 1939 Mar. 1938 +1 +1 -25 + 2 + 5 +16 - 2 - 1 + 4 - 1 + 0 - 0 + 5 + 8 + 13 — 28 + 19 — 8 + 26 — 6 — 2 + 1 — 1 — 2 + 3 + 3 Manufacturing Employ ment Wage payments permits (value) Debits trade sales Allentown............. Altoona.................. Harrisburg............ Johnstown............. Lancaster.............. Philadelphia......... Reading................. Scranton................ Trenton................. Wilkes-Barre. . . . Williamsport........ Wilmington.......... Y ork....................... + 7 +92 + 3 - 1 + 6 + 1 + 9 + 1 + 6 + 0 + 6 +14 +10 + 21 +270 + 17 + 29 + 14 + 8 + 16 + 14 + 19 + 8 + 16 + 15 + 14 +613 + 5 +377 +181 - 77 + 95 + 73 - 95 - 81 - 30 +171 + 65 + 42 + 7 +13 - 1 - 2 + 7 +10 + 19 + 6 +13 + 1 + 9 +13 +10 +13 + 9 + 1 + 4 Allentown............. Altoona.................. Harrisburg............ Johnstown............ Lancaster.............. Philadelphia......... Reading................. Scranton................ Trenton................. Wilkes-Barre.... +1 - 0 +1 + 3 + 1 - 0 - 0 - 3 - 0 - 2 + 0 +1 + 0 INDUSTRIAL EMPLOYMENT AND PAYROLLS PENNSYLVANIA PERCENT +12 + 8 +19 + 11 +16 PAYROLLS +14 + 8 March 1939 from February 1939 Wilmington.......... York....................... + + + + + — — + — _ + + 3 7 6 4 1 1 2 1 4 3 1 3 1 +520 + 45 +699 +641 - 7 +214 +143 + 38 +177 - 59 +127 - 64 + 82 +16 +17 +31 +11 +19 +25 +31 +10 +18 +22 +49 +26 * Area not restricted to the corporate limits of cities given here. +14 +33 +25 - 6 +52 +26 +31 +38 +30 +41 EMPLOYMENT +18 +28 1933 1934 1935 1936 1937 1938 1939 Page Seven OUTPUT OF MANUFACTURES PHILADELPHIA FEDERAL RESERVE DISTRICT Index numbers of individual lines of trade and STEEL manufactures Philadelphia Federal Reserve District LOCOMOTIVES AND CARS Index numbers: percentages of the 1923-1925 average as 100 Adjusted for seasonal variation Adjusted indexes allow for the usual seasonal change in activity. Not adjusted Per cent change Unadjusted indexes reflect merely the actual change which may or may not Mar Jan. Feb. Mar be typical. 1938 1939 1939 1939 Mar. 1939 from Month Year ago ago 1939 from 3 mos. 1938 Mar. Jan, Feb. Mar. 1938 1939 1939 1939 WA">r/-- Retail trade Sales Total of all stores. . . Department........... Men’s apparel. . . . Women’s apparel. Shoe......................... Credit...................... 73r 65 r 63 r 87 r 74 r 90 r Stocks of goods Total of all stores. . . Department........... Women’s apparel. Shoe......................... Credit...................... 81 r 55 r 107 r 73 r 104 r 80 r 80 68 76 lOlr 80 r 102 r 78p 70p 68p 95 89 91 r 85 103 97p 68 68 76 77 77p 50 51 52p 101 103 104 68 75 73 98 100 lOOp + 4 - 1 - 6 - 7 - 6 + + + + + + 8 8 8 2 15 8 - 0 2 + 1 - 3 + - 1 Rate of stock turnover 3 months (actual, not indexes). + 67 r 58 r 54 r 98 r 74 r 75 r 58 49 69 83 r 61 58 r 75p 65p 62p 105 90 84p 83 r 56 r 117r 76 r 107 r 70 r 45 90 61 93 75 79p 50 53p 102 114 69 76 100 102p 8* 0.85r WOOLENS AND WORSTEDS 0.92 Wholesale trade Sales Total of all lines.... Boots and shoes... Drugs...................... Dry goods............... Electrical supplies. Groceries................ Hardware............... Jewelry..................... Paper......................... + 7* + 5* + 5* +39* + 5* + 14* - 8* + 4* + 9* + 1* - 9* - 9* +26* + 22* + 21* - 0* - 3* - 1* +17* + 6* + 9* + 6* + 57* + 32* + 8* + 9* + 8* Stocks of goods Total of all lines. Dry goods............... Electrical supplies. Groceries................ Hardware............... Jewelry.................... Paper....................... + 6* + 3* +12* + 7* - 1* + 9* + 5* - LUMBER PRODUCTS 6* + 2* 3* - 10* - CEMENT - 17* + 12* + 9* 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............... Bread and bakery products.. . Slaughtering, meat packing.. . Sugar refining............................. Canning and preserving........... Cigars............................................ Paper and wood pulp................ Printing and publishing........... Shoes.............................................. Leather, goat and kid............... Explosives.................................... Paints and varnishes................. Petroleum products................... Coke, by-product....................... 25 48 41 42 75 15 47 21 246 73 38 35 58 87 107 r 48 25 23 41 60 52 72 72 19 62 14 293 80 r 58 44 133 102 129 29 36 26 43 58 45 67 74 18 55 17 r 323 85 r 59 43r 132 107 132 56 33 r 23 39 58 47 62 78 19 54 15 322 85 61 43 146 109 132 56p 34 24 90 94 94 103 69 96 61 66 56 54 54 56p 95 87 103 100 65 68 71 71 91 87 89 89 162 133 132 150 76 87 89 87p 77 68 79 76 71 79 76 78 137 156 148 131p 77 100 97 99 * Computed from data unadjusted for seasonal variation. + 56 22 14 + 46 + 4 + 29 + 16 - 26 + 31 + 17 + 59 + 26 +151 + 25 + 23 18 + 37 + 0 + + 4 + - 9 + 4 + 7 - 2 - 7 -0 + 0 + 3 + 1 +11 + 2 - 0 +0 + 4 + 6 + + 1* + + 9 + 8 + 2 - 3 + + 0 + - 1 +14 - 2 - 4 + 2 -12 + 2 + - + + + 26 + + + 22 10 - 8 16 + 1 29 51 44 47 69 16 51 23 255 75 37 37 58 91 117r 37 24 22 87 + 14 - 38 + 24 + 27 + 69 + 33 +181 + 39 + 31 + 51 + 23 6 + 5 3* + 1* 15 + 11 86 3 + 11 105 50 15 - 2 88 + 6 67 8 + 11 3 - 3 93 7 - 5 172 14 + 14 75 2 4 77 9 + 6 73 5 - 2 136 29 + 25 80 p—Preliminary. 40 59 47 76 67 17 62 14 299 82 59 45 125 106 126 20 33 24 87 103 66 45 61 46 75 71 18 60 17 317 90 r 60 46 134 111 144 39 32r 22 88 r 96 80 50 52 71 86 67 71 87 89 136 139 92 96 68 79 71 75 154 146 100 102 45 63 50 69 72 20 59 17 335 SHOES 88 58 46 144 114 144 43p 33 23 89 99 101 51p 92 72 90 159 86p 76 79 130p 102 GOAT AND KID LEATHER PETROLEUM REFINING ^A/^N/VVy\ CIGARS r—Revised. 193 5 Page Eight 1936 1937 1938 1939
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