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THE BUSINESS REVIEW THIRD FEDERAL PHILADELPHIA RESERVE DISTRICT NOVEMBER I, 1923 By RICHARD L. AUSTIN, Chairman and Federal Reserve Agent FEDERAL RESERVE BANK of PHILADELPHIA SUMMARY OF BUSINESS CONDITIONS IN THE UNITED STATES Production of basic commodities declined during September, wholesale trade continued large, while retail trade, though larger than a year ago, increased less than is usual at this season of the year. Wholesale prices, particularly those of agricultural products, advanced during the month. Production in basic industries, according to the Federal Reserve Board’s index, declined 5 per cent during September, and was 10 per cent Production below the peak output of May. The principal factors in this decline were the suspension of anthracite coal mining for over two weeks and a substantial reduction in the production of iron and steel. Cement production and sugar meltings were larger than in August. The decline in the produc tion index, which is corrected for seasonal variations and reflects chiefly changes in the output of raw and semi finished products was not accompanied by a reduction of employment at industrial establishments. New build ing construction showed about the usual seasonal de cline in September, due to a curtailment in contracts for residences. Contract awards for business and in dustrial buildings, however, were larger than in August. Estimates by the Department of Agriculture on October 1 showed some reduction from the September forecasts in the yields of corn, wheat, oats and tobacco, but increased yields of cotton, potatoes and hay. Distribution of all classes of commodities by rail roads continued at a high rate throughout September. Wholesale trade, according to the Federal Trade Reserve Board’s index, in September reached the largest total in three years and was 9 per cent larger than a year ago. Sales of meat, hardware, and drugs were considerably larger than in last Sep tember while shoe sales were smaller. Retail trade was slightly larger in September, but the increase was much less than usual at this season of the year. Department store sales were 6 per cent more than in September, 1922, and stocks at the end of the month were 13 per cent larger than a year ago. Wholesale prices increased over 2 per cent during September, according to the index of the Bureau of Labor Statistics, particularly large inPrices creases occurring in the prices of clothing, farm products, and foods. Fuel prices, on the other hand, declined in September for the T 2 he B u s i n e s s R e v i e w N ovem ber BANK CREDIT MILLIONS OF DOLLARS ALL FEDERAL Re s e r v e banks eighth successive month, and prices of building materials creases in the holdings of Government securities by and metals were also lower. During the first three those banks were partly offset by reductions in corpor weeks of October prices of certain farm products con ate security holdings. tinued to advance, wheat and cotton reaching the highest The demand for accommodation at the Federal re points of the current year, while prices of hogs, coal serve banks in some of the agricultural districts in creased, while at the reserve banks in the east the and metals declined. Demand for credit showed a seasonal increase in volume of discounts for member banks declined. September and the early part of October, loans of Federal reserve note circulation continued to increase member banks in leading cities increasing and in the middle of October was about $100,000,000 S an k ky $116^000,000 between September 19 and above the July level. In October money rates showed an easier tendency cre 1 October 10. This increase reflected chiefly the demand for commercial loans, which on the latter and after the fifteenth of the month rates for commercial date stood at a new high point for the year, almost paper in the New York market declined from a range of $100,000,000 above the total on September 12. In 5J4—Sl 2 to 5—5% per cent. / TABLE OF CONTENTS PAGE Agriculture ...................................................... Autom obiles .................................................... Bankers’ acceptances .................................. Building ............................................................ Cement ............................................................... Cigars ................................................................. Clothing, m en’s w ear.................................. C o a l..................................................................... Coal, anthracite ............................................. Coal, bituminous ........................................... Coke .................................................................... Commercial paper ......................................... Cotton g o o d s .................................................... Cotton, raw .................................................... Cotton, y a r n .................................................... D istrict su m m a r y .......................................... Drugs, wholesale ........................................... 25 14 6 11 11 25 18 14 14 15 15 7 17 16 17 3 9 PAGE Drygoods, wholesale .................................... Electrical supplies ......................................... Employment and w ages............................. Financial conditions .................................... Floor coverings ............................................. F l o u r ................................................................... Foreign exchange ......................................... Groceries, wholesale .................................... Hardware, wholesale .................................. H ides and s k in s ...-...................................... H osiery ............................................................. Iron and s te e l.................................................. Leather ............................................................. Lumber ............................................................... National su m m a r y ........................................ Paint ................................... Paper ................................................................. 9 12 5 6 20 10 7 10 10 22 19 13 22 11 1 12 23 PAGE Paper boxes .................................................... Retail trade .................................................... Savings deposits ........................................... Shirts ................................................................. Shoes, wholesale ........................................... Silk goods ........................................................ Silk, raw ........................................................... Summary, district ......................................... Summary, national ....................................... Synopsis o f business conditions.............. Tobacco ............................................................. Tobacco, leaf .................................................. U n d e r w e a r ........................................................ W holesale t r a d e ............................................. W oolen and worsted goods....................... W oolen and worsted yarn s....................... W ool, r a w ........................................................ 24 8 6 18 9 19 18 3 1 4 24 24 20 8 18 18 17 SUM M ARY OF BUSINESS CONDITIONS IN THE THIRD FEDERAL RESERVE DISTRICT A LTHOUGH conditions in certain lines are still A A described as spotty, a gradual strengthening in JL the business situation since the middle of Sep tember is noticeable. This may be ascribed in part to seasonal factors, it is true, but the distribution of goods is still satisfactory, and prices in several lines are firmer. Little forward buying has developed, most purchasers preferring to order only for immediate needs, but sales are still of considerable volume, and if measured by other than the extraordinarily high levels of the first quarter of 1923, would in the majority of cases be characterized as satisfactory. In several selected cities of this district, debits to individual accounts, which indi cate the volume of payments by check, have been at a higher average during late September and early Octo ber than in the corresponding period of last year. Retail trade has been maintained at a level exceeding that of the same season in 1922, and although one or two lines of wholesale trade report moderate declines as com pared with last year, the total continues large. Freight car loadings are making new records almost weekly, and this in spite of the fact that grain shipments have not been as large as usual, because more producers have followed the policy of storing their grain for the time being. Car loadings in the Allegheny district, ■which includes the Philadelphia Federal reserve dis trict, are considerably above those during September, 1922. Conditions in the textile industry, on the whole, show little change. It is reported that silk goods have been moving slowly because of the advance in prices caused by the higher quotations on raw silk. In woolen and worsted goods, however, certain classes of women’s wear have been in active demand. The demand for men’s wear, however, is still poor. The call for cotton gray goods is only fair, but some improvement has been noted in the demand for the finished fabrics. Buyers of pig iron, aware of the large stocks on hand, have been Pursuing a conservative policy, and prices have con 3 tinued to weaken. Although certain classes of steel also are moving rather slowly, recent inquiries from rail roads have brought about greater-activity in some lines of steel products. Building permits issued in fourteen cities of this district in September were for a smaller amount than were those during August, but neverthe less they were of considerable volume, and most build ing materials are in fairly active demand. Anthracite has been selling readily, but bituminous coal, owing to the recent heavy production, is said to be dull, although total sales must be large. Better weather conditions during recent weeks have improved the agricultural situation in the district, and despite a shortage of farm labor, harvesting has pro gressed satisfactorily. Tobacco leaf of the 1922 crop is in good request, and cigar manufacturers report an increase in orders both for early and for Christmas de livery. Although little change is noted in leather or shoes, hides and skins are in better demand. Among other lines in which there has been an increase in the volume of business since last month are floor coverings, paper, and paper boxes. Prices, which according to most indexes reached a low point in July, have shown a tendency to strengthen during the last two months. The index of the Bureau of Labor Statistics for September was 154, as com pared with 150 in August; and during the same period, other well-known indexes also advanced, Bradstreet’s from $12.9143 to $13.0974, and Dun’s from $187,981 to $190,827. Of course, it must be remembered that prices never advance on an even front. While some prices are increasing, others are either stationary or declining. Indexes serve only to point out the general tendency of the price structure. Although member banks increased slightly their com mercial loans to customers between the middle of Sep tember and the middle of October, they were borrow ing somewhat less from the Federal Reserve Bank. Rates on commercial paper are somewhat easier than they were a month ago. 4 T B he u s i n e s s R N ovem ber e v i e w SYNOPSIS OF BUSINESS CONDITIONS C om piled as of O ctober 23, 1923 D em an d B u sin ess Automobiles Cement . Third Federal R eserve D istr ic t Good Prices i Unchanged to lower Good Unchanged Firm Unchanged to higher Cigars Good Clothing Fair to good Coal, anthracite Fair to good Firm Coal, bituminous Coke Poor Fair Cotton goods Fair Cotton yarns Drugs, wholesale Poor to fair Fair Lower Lower Unchanged to lower Lower Declined Drygoods, wholesale Good Unchanged Electrical supplies Good Floor coverings Fair Flour Fair Unchanged to lower Generally unchanged Advanced Groceries, wholesale Good Advanced Hardware, wholesale Fair to good Unchanged Hosiery, fullfashioned Poor to fair Hosiery, seamless Poor to fair Iron and steel Fair Fair Unchanged to higher Unchanged to higher Unchanged to lower Unchanged Unchanged to lower Unchanged to lower Unchanged to higher Unchanged to higher Unchanged to lower Unchanged to lower Unchanged to lower Unchanged Unchanged Unchanged to higher Higher Unchanged to higher Unchanged to higher Poor to fair Poor to fair Leather belting Fair Leather, heavy Poor Leather, upper Fair Lumber Fair to good Paint Fair to good Paper Fair to good Paper boxes Fair to good Shoes, manufacture Poor to fair Shoes, retail Shoes, wholesale Fair Fair Silk goods Poor to fair Tobacco leaf Underwear, heavy weight Underwear, light weight Woolen and worsted goods Woolen and worsted yarns Fair Fair F in ish ed stock s Labor s itu a tio n Supply W ages C o llectio n s Unchanged Fair to good Some scarcity Unchanged Fair Sufficient Moderate to light Moderate Light to moderate Moderate to heavy Heavy Moderate Sufficient Sufficient Moderate Sufficient Some scarcity Unchanged Fair to good Some scarcity Unchanged Poor to fair Some scarcity ' Unchanged Fair Unchanged Unchanged Fair Fair Unchanged Fair to good Moderate Moderate Moderate to heavy Fair Fair Fair to good Moderate Some scarcity Fair Moderate Sufficient Unchanged Fair to good Moderate Moderate to heavy Moderate to heavy Sufficient Unchanged Fair Moderate Sufficient Unchanged Fair to good Moderate Sufficient Unchanged Fair to good Moderate to heavy Moderate Some scarcity Heavy Fair to good Fair Fair to good Sufficient Unchanged Fair to good Sufficient Unchanged Good Unchanged Good Moderate Sufficient Moderate to heavy Some scarcity Fair to good Moderate Sufficient Fair Moderate Sufficient Unchanged Fair to good Moderate Scarcity of girls Unchanged to higher Fair to good Moderate Sufficient Unchanged Fair to good Fair Poor to fair Moderate Moderate Moderate Some scarcity Unchanged Moderate Fair Fair Light Some scarcity Unchanged Fair to good Light Some scarcity Unchanged Fair to good Unchanged Light to moderate Sufficient Unchanged Poor to fair Unchanged to lower Light Sufficient Unchanged Fair to good l923 T hird F ederal R eserve D 5 istrict EMPLOYMENT AND WAGES P en n sylvan ia, New Jersey and D elaw are Number of wage earners reported Group Number o f plants reporting Sept., 1923 All in d u strie s M etal m a n u fa c tu re s: Automobiles, bodies and parts .......... Car construction and repair............... Electrical machinery and apparatus.. Engines, machines and machine tools. Foundries and machine shops............ Heating appliances and apparatus... Iron and steel blast furnaces............. Iron and steel forgings....................... Steel works and rolling mills............. Structural iron works ......................... Other iron and steel products............ Shipbuilding .......................................... Non-ferrous metals ............................. Aug., 1923 Per cent change Total weekly payroll week ended Sept. IS, 1923 Aug. IS, 1923 1,032 416,872 412,577 + 1.C $10,925,435 $10,748,252 Average weekly wage week ended Per Sept. 15, cent 1923 change + !•< $26.21 Aug. 15, 1923 Per cent change $26.05 + .6 343 207,229 205,045 + 1 .1 8,352 — 9.< 26 7,527 14 32,806 30,855 + 6.: 35 12,881 12,477 + 3.2 38 14,297 14,684 — 2 .t 68 15,406 15,803 — 2.1 5,411 16 5,194 + 4.2 13 13,332 12,432 + 7.2 12 4,976 5,234 — 4.9 48 50,685 48,158 + 5.2 12 3,342 4,271 —21.8 47 30,787 31,269 — 1.5 7 12,045 12,636 — 4.7 7 3,734 3,680 T L5 5,840,483 195,769 1,025,777 313,390 386,389 446,029 170,229 358,403 127,301 1,425,097 89,941 856,326 337,103 108,729 5,780,307 225,334 1,005,936 299,709 384,640 460,407 147,275 340,184 139,296 1,390,622 111,268 833,994 332,421 109,221 + l.C —13.1 + 2.C + 4.6 + -5 — 3.1 + 15.6 + 5.4 — 8.6 + 2.5 —19.2 + 2.7 + 1.4 — .5 28.18 26.01 31.27 24.33 27.03 28.95 31.46 26.88 25.58 28.12 26.91 27.81 27.99 29.12 28.19 26.98 32.60 24.02 26.19 29.13 28.35 27.36 26.61 28.88 26.05 26.67 26.31 29.68 — .03 — 3.6 — 4.1 + 1.3 + 3.2 — .6 +11.0 — 1.8 — 3.9 — 2.6 + 3.3 + 4.3 + 6.4 — 1.8 T extile p ro d u c ts: Carpets and rugs .................................. Clothing ................................................... Hats, felts and other........................... Cotton goods .......................................... Silk goods ............................................... Woolens and worsteds ......................... Knit goods and hosiery ....................... Dyeing, and finishing textiles............. Other textile products.......................... 256 15 32 11 22 72 37 47 11 9 77,755 5,277 5,450 6,098 7,106 19.806 15,767 10,885 5,057 2,309 77,208 4,496 5,440 6,377 7,053 19,982 15,785 10,845 4,889 2,341 + .7 +17.4 + -2 — 4.4 + -8 — .9 — .1 + -4 + 3.4 — 1.4 1,645,574 140,305 99,687 131,250 155,559 382,324 340,777 205,340 137,458 52,874 1,622,858 120,043 97,510 145,377 146,573 389,344 335,177 203,817 132,034 52,983 + 1-4 +16.9 + 2.2 — 9.7 + 6.1 — 1.8 + 1.7 + -7 + 4.1 — .2 21.16 26.59 18.29 21.52 21.89 19.30 21.61 18.86 27.18 22.90 21.02 26.70 17.92 22.80 20.78 19.48 21.23 18.79 27.01 22.63 + — + — + — + + + + Foods an d tobacco: Bakeries ................................................... Canneries ................................................. Confectionery and ice cream ............... Slaughtering and meat p ac k in g ........... Sugar refining ........................................ Cigars and tobacco ................................ 95 22 10 22 14 4 23 28,859 4,890 4,718 5,840 2,885 3,098 7,428 26,471 5,170 3,167 5,357 2,790 2,913 7,074 + 9.0 — 5.4 +49.0 + 9.0 + 3.4 + 6.4 + 5.0 619,073 123,810 115,727 111,542 75,104 84,019 108,871 540,501 131,178 57,899 101,286 71,710 78,205 100,223 +14.5 — 5.6 +99.9 +10.1 + 4.7 + 7.4 + 8.6 21.45 25.32 24.53 19.10 26.03 27.12 14.66 20.42 25.37 18.28 18.91 25.70 26.85 14.17 + 5.0 — .2 +34.2 + 1.0 + 1.3 + 1.0 + 3.5 B uilding m a te ria ls: Brick, tile, and terra cotta products.. Cement ..................................................... Glass ......................................................... Pottery ..................................................... 79 22 15 28 14 23,861 3,269 7,736 8,787 4,069 24,271 3,306 7,684 8,743 4,538 — 1.7 — 1.1 + .7 + -5 —10.3 712,581 95,105 224,070 262,750 130,656 731,348 98,018 227,906 260,744 144,680 — — — + — 2.6 3.0 1.7 -8 9.7 29.86 29.09 28.96 29.90 32.11 30.13 29.65 29.66 29.82 31.88 — — — + + C hem icals an d allied p ro d u cts: Chemicals and drugs.............................. Explosives ............................................... Paints and varnishes ............................ Petroleum refining ................................ 61 39 10 4 8 28,493 8,337 2,952 842 16,362 28,971 8,520 2,940 877 16,634 — — + — — 1.6 2.1 -4 4.0 1.6 812,931 215,674 74,199 20,441 502,617 855,589 220,010 82,902 23,891 529,596 — 5.0 — 2.0 —10.5 —14.4 — 5.1 28.53 25.87 25.14 24.28 30.72 29.53 25.82 28.20 27.24 31.84 — 3.4 + -2 —10.9 —10.9 — 3.5 M iscellaneous in d u strie s: Lumber and planing mill p roducts.... Furniture ................................................. Musical instruments .............................. Leather ta n n in g ...................................... Leather products .................................. Boots and shoes .................................... Paper and pulp products..................... Printing and publishing......................... Rubber tires and goods....................... Novelties and jewelry ........................... All other industries .............................. 198 8 23 3 37 5 32 25 23 21 10 11 50,675 2,468 3,446 8,247 9,104 677 6,013 5,862 3,597 5,308 2,964 2,989 50,611 2,414 3,421 7,568 9,195 647 6,241 5.841 3,545 5,435 3,097 3,207 + + + + — + — + + — — — -1 2.2 -7 9.0 1.0 4.6 3.7 -4 1.5 2.3 4.3 6.8 1,294,793 52,699 86,417 254,567 240,692 12,990 113,279 142,948 112,367 140,264 67,295 71,275 1,217,649 52,781 79,020 206,996 224,804 13,027 109,146 145,975, 101,875 134,327 70,553 79,145 + 6.3 — .2 + 9.4 +23.0 + 7.1 — .3 + 3.8 — 2.1 +10.3 + 4.4 — 4.6 - 9.9! 25.55 21.35 25.08 30.87 26.44 19.19 18.84 24.39 31.24 26.43 22.70 23.85 24.06 21.86 23.10 27.35 24.45 20.13 17.49 24.99 28.74 24.72 22.78 24.68 + 6.2 — 2.3 + 8.6 + 12.9 + 8.1 — 4.7 + 7.7 — 2.4 + 8.7 + 6.9 — .4 — 3.4 -7 .4 2.1 5.6 5.3 .9 1.8 -4 -6 1.2 .9 1.9 2.4 -3 -7 6 T he B u s i n e s s EMPLOYMENT AND WAGES The volume of employment at manufacturing estab lishments in the three states of Pennsylvania, New Jersey and Delaware was slightly larger in September than in August, according to reports received by this bank from representative establishments in those states. The number employed at 1,032 reporting plants increased from 412,577 in August to 416,872 in September, or about one per cent. Total weekly payrolls in the latter month were 1.6 per cent larger than in August, and average weekly earnings ad vanced from $26.05 to $26.21 or .6 per cent. In spite of this relative stability in the general aver age of employment and wages many of the individual industries reported pronounced changes. Of the six groups of industries shown in the accompanying table, the food and tobacco industries showed a general in crease of 9 per cent in employment and 5 per cent in average weekly earnings, indicating a probable in crease in production of between 10 and 15 per cent. Both employment and wages in all of these industries except bakeries, increased, the heaviest gain—of 49 per cent in canneries—being due largely to seasonal factors. Among the metal manufacturing industries notable gains in employment occurred at blast furnaces, steel mills and car repair shops, whereas employment decreased considerably in automobile plants, structural iron works and shipyards. Textile products mills gen erally show only a slight change, although a large in crease was reported in carpet and rug mills, and a smaller gain in dyeing and finishing mills. Both em ployment and earnings decreased in factories manu facturing felt hats. Building material manufacturers reported only slight changes, except in the case of pottery plants where employment declined more than 10 per cent. Of the miscellaneous industries musical instruments and leather products showed the largest gains in employ ment, whereas noticeable decreases occurred in the case of paints and varnishes, boots and shoes, rubber tires and novelties. FINANCIAL CONDITIONS Loans and discounts of reporting member banks in the Third Federal District increased from 641 millions on September 12 to 646 millions on October 10, as a result of gains of 3 millions and 2 millions respec tively in secured and commercial loans. As compared with those of a year ago total loans are 38 millions higher, and investments 21 millions higher. Holdings of United States securities increased 22 millions in the course of the year, but other securities remained prac tically unchanged. Demand deposits declined 21 mil lions, but time deposits almost doubled, rising from 56 millions on October 11, 1922, to 105 millions on Octo ber 10, 1923. The four weeks ending October 17 brought a reduc tion of 2 millions in bills discounted held by the Federal R N ovem ber e v i e w Reserve Bank of Philadelphia. Owing, however, to an increase of 3 millions in purchased paper, total earning assets increased 1 million. Federal reserve note circulation declined from 218 to 213 millions, total reserves from 259 to 252 millions, and deposits re mained stable at 117 millions. The reserve ratio fell from 77.3 to 76.4 per cent. A comparison of the latest report with the figures for previous periods follows: (000,000’s omitted) Oct. 17, 1923 Jan. 3, 1923 July 3, 1923 Oct. 18, 1922 Bills discounted ................... Purchased paper ................. United States securities . .. $57 21 17 $78 19 17 $48 22 34 $42 26 33 Total earning a s s e ts ........ $95 $114 $104 $101 Fed. res. note circulation .. Deposits ............................... Total reserves ..................... Reserve ratio ....................... 213 117 252 76.4% 211 115 230 70.6% 213 121 246 73.6% 195 115 228 73.6% An increase in purchases by the Federal Reserve Bank was largely instrumental in bringing about , larger sales of bankers’ acceptances in Bankers this district bv five dealers. The acceptances weekly average of, all sales was ,, ,« . r $2,801,000 for the four weeks ending October 10. as against $1,860,000 in the preceding period. Pur chases in the district declined from $424,000 weekly to $324,000. Offering rates for 90-day bills re mained steady at 4J4 per cent, with bids at 4*4 per cent. The shipment or warehousing of cotton, grain, flour, coffee, skins, and hides accounted for many of the acceptances executed recently. Comparative statistics for five dealers follow: Sales in Third District W eekly average for period Purchases in Third District To Fed. Res. Bank To others 1923: Sept. 12 to Oct. 10........... Aug. 16 to Sept. 11.......... July 12 to Aug. 15.......... June 14 to July 11.......... $2,520,000 1.549.000 1.442.000 1.919.000 $281,000 311.000 186.000 292,000 $324,000 424.000 271.000 464.000 1922: Sept. 18 to Oct. 15......... Aug. 14 to Sept. 17....... 1.483.000 1.317.000 284.000 132.000 336.000 323.000 Acceptances to the amount of $3,082,000 were exe cuted by twelve banks in this district during the month ending October 10, as against $3,271,000 in the pre vious month, and $3,218,000 a year ago. Savings deposits reported by 80 banks in the Third District on October 1 were $461,474,000, a decline of $460,000, or 0.1 per cent from the figures Savings of September i. As $116,000 of interest P was credited in the interim it appears that the excess of withdrawals over deposits was not T l923 hird F edera l R eserve D 7 istrict $460,000, but $576,000. Seven cities show decreases. In this number are ''included Scranton and WilkesBarre, which are closely identified with the anthracite mining industry. Data by cities follow: Per cent increase or October Number [ decrease ed with 1 compar ' of banks Month ago Year ago Altoona .......................................... Chester . H arrisburg ................................... Johnstown .................................... Lancaster ...................................... Philadelphia ................................ Reading .............................. Scranton ................... Trenton ........................................ Wilkes-Barre .............................. Williamsport ................................ Wilmington .................................. York .............................................. Other cities .................................. Totals ........................................ 5 5 4 6 3 9 3 6 6 5 4 S 5 14 —17 + -5 —1.6 + 7 — .03 + .02 + .8 —1.4 — .8 — .2 — .2 + -2 +1.5 + -6 +11.2 +15.0 +40.9 +16.2 +32.7 + 7.3 +13.3 +14.0 + 5.0 +22.7 + 6.9 + 9.6 +13.8 +17.3 80 — .1 + 9.9 Sou rce—F ederal R eserve Bank of N ew York Although sales of commercial paper to Philadelphia banks during October will probably be smaller in p . amount than were those of September, ornmercia + e ^ tal saies jn thiS district are likely paper , , , J to be greater, as country banks were good buyers. The supply of paper, which was ample during the early part of October, has since decreased considerably, and certain dealers state that their lists are small. Rates are lower, an increased number of names are now offered at 5 per cent, and good sales at this rate are reported in some of the other districts. In this district, however, only a very limited amount has been sold at less than 5% per cent. Most of the sales are now at that figure, although sales at 5l 2 per cent are / in fair volume, especially outside of Philadelphia. Six dealers in this district report sales during Sep tember amounting to $6,805,000. This is a consider able gain over the August figure of $4,903,000. but it is less than the total of September, 1922, which was $7,861,800. The purchases of Philadelphia banks amounted to $2,652,500, and those of outside institu tions to $4,152,500. Rates at which transactions were made ranged from 5 to 5j4 Per cent. The sales nego tiated at each of the outside figures were less than 5 per cent of the total. Somewhat more than 50 per cent of the business was at 5j4 per cent, and the balance at 5p2 per cent. No unusual changes had occurred in foreign ex change movements during the past month until Octo. her 22, when unfavorable news of the e x l^ 1 Separatist movement in Germany ® caused a drop in nearly all Euro pean exchanges. Sterling, which until then had been fairly steady at $4.54, fell to a low level for the year at $4.49. Continental currencies declined in sympathy as is often the case. Both Belgian and French francs became weaker and Italian lire, which had strength ened, were unable to hold their position. The former neutral currencies which had enjoyed a slight advance, fell abruptly. Guilders established a new low mark for the year at $.3876 and Spanish pesetas were lower than they had been for three months past. Swiss francs are fairly stable, but Scandinavian exchanges are depressed, which is partly attributed to poor crops. Norwegian kro ner also touched a new low level for 1923, at $.1548. Far Eastern currencies are fairly steady, although the Chinese tael has declined several points during the past week. Quotations on Japanese yen fully recov ered after the fluctuations incident to the earthquake, and they are now back to the high levels of last July. South American money has depreciated, especially Argentine and Chilean pesos, which were recently quoted at a lower rate than at any time since last spring. Canadian dollars have strengthened, as is cus tomary at this season after wheat crops begin to move. F oreign exch an ge rates Noon cables Par value Oct. 20, 1923 London .......................... $4.8665 $4.5104 .1930 .0590 Paris .............................. .1930 .0510 Antwerp ....................... .1930 .0450 Milan ............................ .2026 .000014 Vienna .......................... .4020 .3909 Amsterdam ................... .2680 .1747 Copenhagen ................. .2680 .2631 Stockholm .................... .1930 .1342 Madrid .......................... .1930 .1787 Berne ............................ .9648 .7316 Buenos Aires ............... .7411 .6973 Shanghai ....................... Sept. 20, 1923 Oct. 20, 1922 $4.5436 $4.4683 .0590 .0744 .0495 .0689 .0448 .0420 .000014 .000014 .3931 .3917 .1806 .2001 .2654 .2674 .1351 .1536 .1771 .1827 .7598 .8208 .7105 .7307 T 8 he B u s i n e s s In the table on page 7, comparative figures are given, showing the changes in quotations that have occurred since last month and since the correspond ing date of 1922. RETAIL TRADE Retail trade during October continues in good volume and bids fair to exceed that of October, 1922; but some reports state that consumers of both men’s and women’s apparel are objecting to present prices and are holding back until forced to buy by cooler weather. In men’s apparel shops, however, clothing is selling better than haberdashery, and in the department stores sales of women’s apparel are good. Gloves, both leather and fabric, are in good request, and rugs continue to sell readily; but furniture sales are falling off. The protests of consumers against present prices have made it difficult to obtain advances, and have also increased the already cautious buying policy of retail establishments. During September, as will be seen in the accompanying table, sales increased 10.7 per cent, as compared with those of September, 1922. This in R N ovem ber e v i e w crease is smaller than that of the past few months, in which the gains over the sales of the corresponding months in the previous year were as follows: in May, 17.3 per cent; in June, 23.4 per cent; in July, 13.6 per cent; and in August, 13.4 per cent. It must be noted, however, that September, 1922, was a good month in the retail trade and showed an increase of 15.3 per cent as compared with September, 1921. In the anthracite regions the figures for this year compare favorably with those of the strike period of a year ago. In the bituminous fields and in iron-ore centers reports of de creased activity are reflected somewhat in the de creased percentage of gain as compared with that of recent months. The number of orders outstanding on September 30, as compared with total purchases in the previous year, was 10.5 per cent in 1923 and 9.0 per cent in 1922. WHOLESALE TRADE Sales at wholesale during October are reported in preliminary estimates to be in about the same volume RETAIL TRADE T hird Federal R eserve D istr ic t Comparison o f net sales Sept., 1923 with Sept., 1922 July 1 to Sept. 30, 1923 with July 1 to Sept. 30, 1922 Comparison o f stocks Rate of turnover* 1 Percentage of orders outstand ing Sept. 30, 1923, to July 1 to July 1 to Sept. 30, Sept. 30, total purchases in 1922 1923 1922 Sept. 30, 1923 with Sept. 30, 1922 Sept. 30, 1923 with Aug. 31, 1923 +11.6% 8.9 “ +10.8% + 1 1 .4 “ 2.7 3.0 2.7 3.0 10.5% 11.3 “ 9.2 “ + 1 7 .9 “ + 4 1 .6 “ + 1 6 .9 “ +26.1 “ +16.2 “ + 1 0 .3 “ +30.7 “ +14.1 “ +24.5 “ +29.6 “ + 4.7 “ + 2.6 “ +14.1 “ 8.7 “ + 1 3 .4 “ + 8.7“ + 8.4“ + 1 0 .2 “ +10.3 “ + 8.5 “ + 7.5 “ + 9.0 “ + 1 1 .4 “ + 1 2 .7 “ + 1 0 .8 “ + 1 0 .3 “ + 9.2 “ 2.1 2.4 1.4 2.1 2.6 2.0 1.9 2.2 2.3 2.5 1.8 1.6 2.1 2.1 2.9 2.4 1.2 2.3 2.8 2.1 1.8 2.3 2.5 2.6 2.3 1.7 2.0 2.3 7.2 “ 9.9 “ All reporting firms ................... Firms in—Philadelphia ............ —Allentown, Easton and Bethlehem . . . —Altoona .................... —Chester .................... —H arrisburg ............. —Johnstown ............... —-Lancaster ................ —Reading ................... —Scranton .................. —Trenton ................... —W ilkes-Barre .......... —Williamsport ........... —Wilmington ............ —York ......................... —All other cities ....... + 10.7% + 1 1 .9 “ + + 12“ +18.1 “ + 1 4 .0 “ + 4.8 “ +10.0 “ + 4.0 “ + 9.5 “ +22.9 “ — .3 “ +13.3 “ + 1.0“ + 1.5“ + 2.0 “ + 6.4 “ + 6.8 “ + 1 7 .7 “ +30.2 “ + 9.6 “ +12.3 “ + 1 3 .3 “ + 1 3 .6 “ +24.2 “ + 4.1 “ +15.9 “ — .0 “ + 4.6“ + 5.1 “ + 1 4 .7 “ All department stores . ............ Department stores in Phila.. .. Depart, stores outside Phila.. . + 1 1 .0 “ +12.2 “ + 7.3 “ +12.5 “ + 7.9 “ +24.0 “ + 1 0 .9 “ + 8.3 “ + 1 5 .8 “ +10.8 “ + 1 1 .6 “ + 9.8 “ 2.7 3.0 2.2 2.7 2.9 2.3 10.8 “ 12.1 “ 8.2“ All apparel stores ..................... Men’s apparel stores —in P hiladelphia........ —outside Philadelphia Women’s apparel stores —in P h iladelphia....... —outside Philadelphia + 9.9 “ + 5.5“ — 3.3 “ + 1 6 .5 “ +10.6 “ +13.5 “ + .1 “ +13.4 “ + 8.6 “ + 2.3 “ +15.6 “ +12.3 “ + 1 6 .0 “ + 2.5“ + 1 3 .9 “ +12.1 “ +14.5 “ +10.5 “ + 2.8 “ — 1.7“ + 1 1 .7 “ + 1 1 .0 “ + 5.2“ — 2.2 “ + 1 1 .0 “ + 19.7“ + 19.7“ +19.7 “ 2.9 1.8 2.0 1.6 4.3 5.0 2.6 2.7 1.8 2.1 1.6 3.3 3.4 3.0 6.8“ 9.6“ 9.6 “ 8.6“ 8.8 “ 6.4“ Credit houses ............................. + 9.9“ + 1 9 .2 “ + 7.5 “ — 7.7 “ 2.3 2.4 5.0“ +11.3% 8.7 “ + - + + 1 * Times per year based on cumulative period. 6.7 “ 1923 T hird F ederal as they were during September. In drugs a slight de crease in demand is noted, but the call for groceries has improved somewhat; and in the other reporting lines the demand is unchanged. In September, sales were larger than in September, 1922, except in the case of shoes. As compared with August, however, billings of groceries, drygoods, and shoes increased, and drugs and hardware fell off. The prices of most articles have changed only slightly during the month. The trend of groceries is upward, and cotton goods in a number of lines are also higher. Fine drugs and chemicals are lower, but the prices of hardware and of shoes remain about the same. Collections during September were slower than in August in all lines except drygoods. A number of wholesalers report that sales of shoes during October are larger than they were in October, 1922, but others state that business has deShoes creased and that retailers have not moved their stocks because of the continuance of warm and clear weather, and therefore are not buying. Women’s pumps in suede and patent leather, misses’, boys’, and children’s calf-high shoes, men’s oxfords and high shoes of calf and side leather, felt slippers and romeos, have all sold in fair quantity. Prices of shoes, with the exception of men’s work-shoes, are steady. The demand for work-shoes has decreased, and prices have been reduced. In the opinion of some, wage earners are now able to purchase higher grades of shoes because of the increased pay they are receiving. During September, sales in this district, as reported to the Federal Reserve Bank, increased 8.1 per cent as compared with August, but were 2.7 per cent smaller than in September, 1922. The ratio of accounts outstanding to sales on September 30 was 252.7; on August 31, 248.7; and on September 30, 1922. 220.6. An increased number of firms report that collections are slow. Preliminary reports indicate that sales of drygoods during October are continuing in about the same vol R eserve D 9 istrict ume as those of September. Prices show little variation; there have been no declines of importance, and the ad vances have been confined to slight changes on certain cotton goods. Drygoods Blankets, underwear, sweaters, outing flannels, and Christmas goods are among the best selling lines for early delivery. For spring shipment, cotton novel ties lead. Stocks in the hands of wholesalers are moderate or heavy, but some reports state that they are decreasing. Sales of drygoods at wholesale during September in creased 30.2 per cent as compared with those of August and were 13.9 per cent larger than in September, 1922. Collections, according to the majority of the reports, are fair, and only a few class them as poor. The ratio of outstanding accounts to sales is 200.1, as against 214.1 a month ago and 207.2 a year ago. The wholesale drug market is not so active as it was • two months ago or as in September. The demand for drugs has decreased slightly, although most Drugs wholesalers report that it is greater than it was in October, 1922. Medicines for colds, oils, and toilet articles have been the most active sellers. The botanical drug business has been somewhat dull, but prices have held firm. Fine chemicals and prepared drugs, too, have been in light demand, and quotations have softened after a sharp rise last month. The table on page 10 gives the price indexes of 40 botanical drugs and 35 drugs and fine chemicals, as compiled by the “Oil, Paint and Drug Reporter.” Sales at wholesale in September were 4.8 per cent smaller than in August, but 4.9 per cent greater than those of September, 1922. Stocks held by the dis tributors vary from moderate to heavy and in general are larger than they were last month. Collections are only fair. The ratio of accounts outstanding to sales in September was 159.2, as compared with 157.2 in August and 159.8 in September, 1922. WHOLESALE TRADE Third Federal Reserve D istr ic t Percentage o f increase or decrease in Number of reporting firms N et sales Sept., 1923, compared with— A ug., 1923 Roots and shoes .................... D ru g s ......................................... D ry g o o d s ................................... G roceries ................................... H a rd w a re .................................. 13 15 19 60 32 Ratio of accounts outstanding to sales Accounts outstanding Sept., 1923, compared with—• Sept., 1922 A ug., 1923 Sept., 1922 + 8.1% — 4.8 “ +30.2 “ + -1“ — 1.3“ — 2.7% + 4.9“ +13.9 “ +14.3 “ + 7.1 “ +12.4% + .8 “ +21.7 “ + 6.2 “ + 1.4“ +11.2% + 1 1 .7 “ +10.0 “ + 1 3 .4 “ +12.0 “ Sept., 1923 Aug., 1923 Sept., 1922 252.7% 159.2 “ 200.1 “ 109.2 “ 169.5 “ 248.7% 157.2 “ 214.1 “ 102.3 “ 165.8 “ 220.6% 159.8 “ 207.2 “ 110.7 “ 162.6 “ T IO he B u s i n e s s Price index o f 40 botanical drugs Price index of 35 drugs and fine chemicals 1923 1923 W eek ending R N ovem ber e v i e w outstanding to sales increased from 102.3 in August to 109.2 in September. FLOUR September 24 ............ October 1 ................. October 15 ................. October 22 ................. 123.3 123.5 123.6 123.6 123.8 1922 110.0 114.8 117.3 117.3 116.0 214.3 212.4 208.1 206.1 204.9 1922 161.0 162.4 164.4 169.5 167.1 The net sales of 32 hardware firms in this district during September decreased 1.3 per cent from those for the preceding month, but were 7.1 per Hardware cent greater than the net sales in Sep tember, 1922. In contrast to this, our September sales index, compiled from the reports of 20 representative firms, and making allowances for seasonal variations, was 120, a gain of 9 points over that for August, and of 13 points over the index figure for September of last year. Demand is from fair to good. Builders and contractors continue to buy actively, and supplies for mills, mines, and manufacturers are in good request. Considerable light hardware has been sold to retail dealers and sporting-goods houses. Prices in nearly all cases are unchanged from those prevailing a month ago, but are higher than they were at this time last year. Stocks of finished goods are from moderate to fairly heavy, as has been the case for the past three months. Collections are from fair to good. The ratio of ac counts outstanding to sales was 169.5 in September, as compared with 165.8 in August and 162.6 in Sep tember, 1922. Groceries are in good demand, and jobbers report that sales are satisfactory and slightly larger than they were in September. Wholesalers’ shipGroceries ments of new pack canned goods to re tailers are still heavy, and these consti tute the largest item of present deliveries. The approach of Thanksgiving Day and Christmas has stimulated the demand for nuts, raisins, and other holi day specialties. Canned vegetables and fruits, cereals, sugar, syrup, pancake and self-raising flours, dried fruits, and nuts are the best selling commodities at present. The general trend of prices is upward; sev eral items, especially canned tomatoes, rice, dried beans, canned corn and fish, cheese, and sugar, are higher than they were a month ago, and very few commodities have declined. Jobbers’ stocks are heavy, and larger than they were last month; but this is normal for this season of the year, because of heavy deliveries of new crop dried fruits, vegetables, and canned goods. Wholesale grocery sales during September were 0.1 per cent larger than in August and 14.3 per cent greater than in September, 1922. The ratio of accounts The flour market has been rather dull during the month, and buying for domestic use has not been as heavy as it was a year ago. Some large bakers have placed big orders with western mills at present prices, but the majority of consumers are buying very cau tiously and for immediate needs only. The strengthen ing of both flour and wheat prices during the past six weeks has influenced buying but little, and users of flour show only slight interest in contracts for future needs. Spring patents are now 15 to 25 cents per bar rel above the low price at the close of July, being quoted at from $6.00 to $6.40 per barrel in car lots, as compared with $5.75 to $6.25 in midsummer. Spot wheat quotations have advanced about 12 per cent since September 1. Number 2 red is now selling at $1.23p2 per bushel, as against $1.09^ on that date. The fol lowing chart, based upon the prices of soft straights flour and No. 2 red wheat, shows that flour and wheat prices are about on a par with prices at the close of 1914. As a result of the light demand, grinding at mills in this district and throughout the country is still greatly curtailed. Many mills are operating at only one half or two thirds of capacity. Consequently, stocks of flour have been gradually diminishing, and at public warehouses in Philadelphia they were smaller on Octo ber 1 than at any time this year, though greater than on the same date last year. The following table shows the amount of flour and of wheat in storage at public warehouses in Philadelphia on the first day of each month. T 1923 hird F ederal P u b lic w areh ou se sto ck s a t P h ilad elp h ia Flour (bbls.) Wheat (bus.) First day of month 1923 January ......................... February ...................... March ........................... April ............................. May ............................... June .............................. July ............................... August .......................... September .................... October ......................... 1922 1923 1922 192,000 210,067 200,854 211.072 214.109 190,381 173,027 157,091 144*241 135,474 193,633 168.490 157.553 153.028 136,718 113,732 96,434 1.766.470 1,511.906 2,027,632 2.153.108 1.256,793 331.211 317,622 462 691 1.457.728 869,457 2,771,834 2.080,117 1,886,597 1.578,268 1.161,572 1,303,364 2,367,186 93.788 83,762 1.180,422 1,622,713 Exports of flour during the past two months have been much heavier than they were during the summer months, and exports of wheat, too, show an increase. In September, shipments of flour from the port of Philadelphia were greater by 28 per cent than in Sep tember, 1922, but exports of wheat were only one half as large as they were a year ago. For the first nine months of this year exports of barley and oats ex ceeded those of the same period of 1922, but shipments of corn, wheat, and rye showed a sharp decline, and flour exports decreased slightly. The British Isles, Germany, and the Levant have been the principal buy ers of flour, and Britain the chief purchaser of wheat. Exports of flour and grain from P h ilad elp h ia September September 1923 1922 Jan. to Sept. 1923 Jan. to Sept. 1922 69,298 54,023 384.807 388.163 Flour (bbls.) ............... Wheat (bus ) ............. 1.184,504 2.440,409 22,828.011 30,104,236 229,380 4,330,541 10.760,034 Corn (b u s ) ................. 149,342 436.789 373,545 Oats (bus.) . .. Rye (bus.) ................... 1.185,878 615,687 1,997.537 9,990 24,935 Barley (bus.) .............. Receipts of flour and of oats at Philadelphia during 1923 have been considerably larger than they were in the same period of 1922; but receipts of wheat, corn, rye, and barley have declined sharply. The smaller exportings of the latter grains have been the chief cause of the decrease in shipments to Philadelphia. R eceip ts of flour and grain a t P h ilad elp h ia September September 1922 1923 Flour (bbls.) ............. Wheat (bus.) ........... Corn (bus.) ............... Oats (bus.) ................ Rye (bus.) ................. Barley (bus.) ............ Jan. to Sept. 1923 Jan. to Sept. 1922 248,960 283,938 2,263.438 2,082,292 875.298 3.325.924 24.390.801 31.489.771 310,549 6.021,678 12,197.950 33,351 185,513 389,173 2.912,197 2,455.442 17,606 1,270,336 680.225 1.990.147 62.801 39.347 1.241 3,452 R eserve D istrict 11 BUILDING The value of building permits issued by fourteen cities in the Third Federal Reserve District during Sep tember totalled $11,604,678, as compared with $13,294,661 in August, a decline of $1,689,983. A total of 3,222 permits were granted during the month, which was 322 fewer than in August. The value of permits in Philadelphia declined $1,160,220 from that in the preceding month, and most of the other fourteen cities have reported reductions. However, gain's are noted in Allentown, Atlantic City, Wilmington, York, and Williamsport. The value of permits issued in Sep tember of this year were $4,263,992 less than the figure for the corresponding period of 1922, as is shown in the table on page 13. Lumber manufacturers report some increase in de mand since last month, and wholesale dealers state that a better feeling prevails throughout Lumber the market. Sales are greater than they were at this time last year, according to some manufacturers, but according to several important dealers in this district, they show a decrease. The de mand for hardwoods has remained steady, as has that for cypress, and yellow pine is also in good request. Orders are of about the same size as usual at this sea son, and those already taken at the mills will insure operations for from three weeks to six months, the average being about 60 days. Prices, though spotty, are somewhat higher than they were last month. Quo tations on spruce are steady, but prices of some grades of pine have been advanced. Hardwood prices are in general firm. Manufacturers’ stocks are fairly heavy but are de creasing; while dealers’ stocks are moderate and sta tionary. Although a few large mills are operating at capacity, the rate of operations in mills reporting to us averages 83 per cent of capacity, which is about the same as that of September. Some difficulty is experi enced in securing sufficient labor of all kinds, particu larly in the South and West, where seasonal occupa tions draw workers away from the mills. Collections are from fair to good and are about the same as they were last month and at this time last year. The heavy demand for cement that prevailed during the summer months has slackened somewhat with the coming of fall and the attendant decline Cem ent of building operations. The demand is still good, however, and though not as strong as it was last month, it is considerably better than it was at this time last year. Most of the orders now being filled specify shipment within 60 days, or at least before the arrival of freezing weather. Production has been maintained at a record level, according to the Department of Commerce, the national output in September being 13,109,000 barrels. This figure exceeded the previous high record, reached the month before, by 142,000 barrels. 12 T he B u s i n e s s R e v i e w N ovem ber vorably with those of this time last year, although they have failed to reach the seasonal expectations of many manufacturers. Many orders are for smaller quanti ties than usual, which indicates a more or less immedi ate consumption. Moreover, the majority of purchases are for fairly prompt delivery, practically none being for shipment beyond 60 days. Some slight reduction in the price of mixed paints occurred during the last part of September, but since then quotations have either remained stationary or gone slightly higher. Dry color prices are mostly unchanged, and quotations on linseed oil, after declining 3 cents to a tank car price of 83 cents per gallon, rose in October and are now listed at 89 cents per gallon. Stocks of both finished goods and raw materials are reported to be from moderate to light and are increas ing. The present rate of operations is from 50 to 80 per cent of capacity, which is less than the average rate T h e sea so n a l r e la tio n sh ip b etw een s to c k s a nd p r o d u ctio n o f c e m e n t is ap p a re n t. D u r in g th e fa ll a nd w in ter m o n th s p ro d u ctio n of last month. The supply of both skilled and unskilled exceeds s h ip m e n ts, a n d sto c k s a c c u m u la te ; th e s e in tu rn are decreased by heavy s h ip m e n ts d u rin g labor is adequate. th e sp rin g a nd s u m m e r . Collections are regarded as only fair and show little S ou rces—D un’s R eview , D epartm ent o f Com m erce change from those of last month or of this time last During a period of five months ending with May, stocks on hand exceeded production, as is shown by the year. A good demand for electrical supplies is reported by accompanying chart, which depicts the situation for the twelve months ending October 1. Stocks at present dealers. Sales of radio equipment, in particular, have are from moderate to light, as is usual at this season, . increased and washing machines and and supplies of raw material are stationary. On Sep cc rica labor-saving devices are in better request tember 30, finished stocks in this district totalled pp than they were a month ago. Almost all 1,630,000 barrels, as compared with 2,118,000 barrels orders booked are for delivery within 60 days, although on August 31. The table below shows the district out a few are for up to and beyond 90 days. Stocks of fin put for the past nine months and for the corresponding ished goods are moderate, in some cases even light, and months of 1922. they have changed but little from those on hand at this CEM ENT PRODUCTION time last month. Prices in general are unchanged, with T hird Federal R eserve D istrict the exception of those on copper wire and rigid conduit pipe, which are lower and are still weak. 1922 1923 The demand for electrical contracting work has be come brisker with the advent of fall, and labor in this J a n u a ry ................................ 1.134.000 bbls. 2.111.000 bbls. 2.048.000 “ 1.455.000 “ field is considered adequate, although one firm reports 2.189.000 “ M arch .................................... 2.659.000 “ some scarcity of skilled workers. According to reports 2.568.000 “ 2.996.000 “ April ............'................ . 2.964.000 “ 3.347.000 “ received from 35 manufacturers of electrical machinery J u n e ......................... ................ 2.827.000 “ 3.155.000 “ and apparatus in Pennsylvania, New Jersey and Dela 3.216.000 " 2.842.000 “ J u l y ........................................ A u g u st . , r............................ 2.997.000 “ ware, the number of wage earners during September 3.388.000 “ 3.124.000 “ September ............................ 3.293.000 “ showed a noticeable increase over that of August The following table gives employment data for each of the No change in prices has occurred for several months, two months. and present quotations are generally reported still to be strong. Collections, which differ but little from those Number o f reporting W eek ending W eek ending Per cent firms— 35 S e p t 15 Aug. 15 change of last month or of last year, are from fair to good. Labor, both skilled and unskilled, is more plentiful than it was three months ago, but in some cases a scarcity Number o f wage earners. 12,477 + 3 .2 12,881 Total wages ...................... $313,390 $299,709 + 4 .6 is reported. $24.02 $24.33 + 1 .3 The demand for paints and varnishes, according to Average weekly w a g e .... manufacturers and dealers reporting in this district, has Collections, which are only fair, are about the same improved somewhat since last month. InP aint side paints are in good request, as are floor as they were last month, but poorer than during Octo and finishing varnishes. Sales compare fa ber of last year. 923 T J F hird R ederal D eserve 3 istrict T BUILDING PERM ITS T hird Federal Reserve D istrict September, 1923 January to September, inclusive September, 1922 1923 Permits Allentown ................. Altoona ...................... Atlantic City* .......... Camden ..................... H arrisburg ............... Lancaster ................... Philadelphia ............. Reading ..................... Scranton* ................... T renton ..................... Wilkes-Barre* .......... Williamsport* ........... Wilmington ............. Fork ........................... Total for September 96 184 153 156 69 55 1.097 211 121 162 107 106 130 100 2,748 Operations Estimated cost Permits 96 184 153 269 74 70 1,390 211 121 211 107 106 130 100 $473,820 167,837 641.529 468,060 768,535 286,675 7,086,060 183,325 187,000 505,270 251,109 113.642 347,778 124,038 3,222 $11,604,678 Operations Estimated cost Permits 102 142 242 187 127 75 2,020 298 103 152 72 114 94 132 2,940 $572,860 218,978 659,848 333,315 300,414 411,320 11,714,140 523,580 210,030 266,552 224,364 136,779 214,928 81,562 3,860 89 142 242 131 80 75 1,260 278 103 131 72 111 94 132 $15,868,670 828 1,465 2,012 934 725 719 11,217 2,492 1,180 1,391 910 830 908 1,217 1922 Estimated cost Permits $4,014,090 2,549,314 7,424,192 6,277,194 6,669,242 2,804,430 101,857.590 3,804,705 2,712,411 5,482,111 2,385,797 984,301 2,957,232 1,715,209 26,828 $151,637,818 751 1,424 2,929 919 756 679 11,212 2,556 1,142 1,155 1,025 891 782 1,127 Estimated cost $2,805,790 2,132,779 6,646,406 3,372,544 3,371,695 2,217,020 85,620,425 3,980,451 4,004,416 3,335,596 3,156,951 1,368,104 2,404,650 1,018,419 27,348 $125,435,246 Do not report operations. NEW BUILD IN G S AND ALTERATIONS New buildings Permits Allentown . . . . A lto o n a ........... Camden ........... H arrisburg . .. . Lancaster ........ Philadelphia .. R e a d in g ........... T renton .......... Williamsport .. Wilmington ... York ............... 1Oper. 77 73 92 64 28 608 51 139 51 97 77 73 189 69 42 889 51 188 51 97 54 54 Est. cost $461,900 130,174 426,175 759,385 271,800 6,657,105 101,650 442,051 105,420 332,164 113,285 1923 j Permits 19 115 64 5 28 489 160 23 55 33 i 46 Oper. 19 115 80 5 28 j 501 160 | 23 55 33 46 | IRON AND STEEL The demand for most classes of iron and steel has been light during the past month. Although consump tion continues at a high rate, buyers are said to be adhering to a conservative policy. In the second week in October, however, the number of inquiries for steel increased, and the outlook became more encouraging. The light demand for pig iron is generally conceded to be the result of overproduction and of the fact that buyers, who are usually in the market at this season, are holding off in view of the weakness in prices. Manu facturers of iron and steel castings report a fair demand and state that railroads, car builders, and valve con tractors are the largest consumers. Iron bars are in better request, and sales have been made principally to crucible steel companies. Makers of machinery and of tools find that railroads and steel mills are taking the majority of deliveries, and that the demand may be classed as fair. Plates and shapes are moving slowly, and orders from boiler shops and from fabricators are New buildings Alterations Est. cost $11,920 37,663 41,885 9jl50 14,875 428,955 81,675 63,219 8,222 15,614 10,753 Permits Oper. 58 51 84 73 37 662 80 114 39 57 42 68 51 140 119 37 1.404 100 135 39 57 42 j Alterations 1922 Est. cost $402,360 181,514 265,325 291,764 337,835 11,178.165 411,500 232,242 126,195 196,148 60,070 Pennits 31 91 47 7 38 598 198 17 72 37 90 Oper. 34 91 47 8 38 616 198 17 75 37 90 Est. cost $170,500 37,464 67,990 8,650 73,485 535,975 112,080 34,310 10,584 18,780 21.492 not of sufficient quantity to cause a strengthening of the market. Miscellaneous products are in only fair re quest, and with the exception of drop and steel forg ings, which are in less demand, no change is noted since last month. Railroads have been making inquiries foi sted rails, and the future for this class of steel is be coming brighter. For the past six months unfilled or ders of the United States Steel Corporation have been steadily decreasing. The September total was 5,035,750 tons, as compared with 5,414,663 tons for August; a reduction ol 378.913 tons. Production has been curtailed somewhat as a result of the present market conditions, and this situation is reflected in the pig iron output for September, which was 3.125,512 gross tons, as compared with 3,449,493 gross tons in August. The average daily output was 104,184 gross tons in September, a low level equalled only by that in January of this year. The total number of furnaces in blast on October 1 was 255, as against 270 on September 1. There were 18 furnaces either H T he B u s i n e s s R eview N ovem ber banked or blown out and 3 blown in, or a net loss of 15. compiled figures based on reports from 181 manufac In this district 3 furnaces have been blown out since turers. During the first eight months of this year, September 1, leaving 34 in blast. The estimated output production, totalled 2,431,063 passenger cars and of steel ingots during September was 3,313,354 gross 258,774 trucks, as compared with 2,339,414 passenger tons, as compared with 3,677,771 gross tons in August, cars and 244,882 trucks during the entire year of 1922. The table below gives production figures for both types a decrease of 2.7 per cent. Manufacturers of both iron and steel are operating of automobiles for the first nine months of 1923 and at an average rate of 80 per cent of capacity, or 1922. These totals are based on reports received about the same as that reported last month. The ma monthly from approximately 90 passenger-car and 80 jority of firms in this district find but little difficulty in truck manufacturers. For seasonal reasons the total obtaining an adequate supply of both skilled and un production of both passenger cars and trucks is nor skilled labor, but a few mention a scarcity in some mally less in September than in August. localities. On September 15, the number of employees in 68 foundries and machine shops was 2.5 per cent less Passenger cars Trucks than on August 15, but similar computations for 48 steel works and rolling mills indicate an increase of 1923 1922 1923 1922 5.2 per cent. Prices of major steel products have remained un January ....................... 223,706 9,416 19,398 81,693 changed from those of this time last month, although February ....................... 254,650 101,171 13,195 21,817 19,761 quotations for several lines are weak. Concessions March ........................... 319,638 152,959 34.681 22,342 April ........... ................. 344,474 197.216 37.527 are noted in some of the minor products, and prices May ............................... 350,180 232.431 43,012 23.788 25,984 of scrap are lower. Quotations for pig iron have fallen June .............................. 336,317 263.027 40,565 21,837 224,770 from 50 cents to $2.00, and are unstable. On October July ............................. 297,104 249.460 29,998 28.947 24,601 August ........................ 313,236 16, Philadelphia 2X pig iron was quoted at $24.26 per September .................... 298,600 187,661 27,841 19.633 ton, as compared with $26.26 per ton on September 18. The composite price of finished steel on October 9, Collections continue to be good and are said to be computed by the “Iron Age,” was 2.775 cents per pound, which was the same as that on September 11 ; better than they were a year ago. and the composite price of pig iron was $23.79 per COAL gross ton, as compared with $25.29. With the approach of cooler weather, an increased Collections average from fair to good but are not quite as satisfactory as they were at this time last demand is apparent for domestic sizes of anthracite. month. Consumers are laying in winter stocks Anthracite in greater quantities after the hesita AUTOMOBILES tion incident to the advance in price Automobile dealers report that the volume of sales at the end of the strike. The call for steam sizes, how during the third quarter of the year was large and that ever, is poor, and the market has not shown the im the numerous inquiries received from prospective buy provement expected of it at this season. As a result, ers point to an increased demand for cars for winter use. some operators are finding it necessary to accumulate Total sales were somewhat smaller than those of the stocks and others are making price concessions in order second quarter, but were far greater than those of the to prevent overstocking. corresponding period of 1922. It is estimated that Prices of domestic grades are firm and practically un aggregate sales for 1923 will reach approximately changed, but quotations for steam sizes have been $3,375,000,000, or an average expenditure of about shaded in some cases and are weak. Company stove $144 per family. Closed cars are in greatest request, coal is quoted at from $8.90 to $9.25, f. o. b. mine*, but touring cars are also selling well. Deliveries from which has been the prevailing price since the latter part the factory are fairly satisfactory, though one dealer, of September. who handles a well-known, moderate-priced car, states Production was considerably under normal at the that orders are being filled with difficulty. Because of close of the first week that mining was resumed, because purchasers’ insistence upon prompt deliveries, stocks many of the men were slow in returning to their work. in practically ail cases are light. Since then, output has been maintained at an average Some manufacturers have advanced prices on a few of something over 2,000,000 tons per week. During the models, but the majority have made reductions, rang week ending October 6, a total of 2,015,000 tons was ing from $100 on one of the more expensive cars to as produced, which not only equalled the output of the little as $10 on one of the lower priced cars. week preceding the strike but was 60,000 tons in ex A record production of both pleasure cars and trucks cess of the average weekly production for the first five is noted by the Department of Commerce, which has months of the present coal year. The following table T l923 A N TH R A C ITE hird F ederal R eserve D istrict 5 Production has been maintained for several weeks at a high weekly rate of over 11,000,000 tons, but the out put for the week ending October 13 declined to 10,782,000 tons, largely on account of the softening of the market. But even with this reduction, the average daily output has exceeded that of the autumn of both 1921 and 1922. The Geological Survey estimates pro duction for the last four weeks and for the correspond ing four weeks of 1922 as follows: PRODUCTION Week ending September 2 2 ............... September 2 9 ............... October 6 ............. ;. .. . October 1 3 .................... indicates the approximate output in tons for the past 4 weeks and for the corresponding weeks of last year: Week ending 1923 1922 September 2 2 ............... September 2 9 ............... October 6 ...................... October 13 .................... 877,000 tons 2,025,000 “ 2,015.000 “ 2,009,000 “ 1.897,000 tons 1,982,000 “ 1,994,000 “ 2.112,000 “ The mines are operating at close to capacity, al though several operators state that there is a shortage of both miners and miners’ helpers. The’lack of demand for bituminous is the principal feature of nearly all reports of operators and dealers in this district. While the demand is Bituminous characterized as fair in a few cases, it is generally conceded that the market has fallen to a lower point than has been touched for some time. This condition is accounted for to some extent by the fact that the railroads still have large stocks on hand which were delivered on contract, and in many instances they have suspended shipments. Then, too, stocks already in the hands of other con sumers are exceptionally heavy, which has also tended to lessen the demand. One large operator states that the principal sales at present are being made to indus tries in the South and West. Prices naturally reflect this condition and are lower than they were at this time last month. Contract prices are from $1.00 to $1.50 above spot prices, and this has resulted in numerous requests for the postponement of shipments. On October 15 spot quotations for Pool 9 coal were from $2.35 to $2.60, f. o. b. mines, as com pared with from $2.50 to $2.80 on September 17. i 1923 11.431.000 tons 11.347.000 “ 10.782.000 “ 10.771.000 “ 1922 9.747.000 tons 9.822.000 “ 9.736.000 “ 10.110.000 v Stocks on hand throughout the country are estimated at 56,000,000 tons, and this large supply is the princi pal reason for the curtailment of operations in many in stances. Some mines are operating only two or three days a week, and the average rate of operations at those reporting to us is not over 50 per cent of capacity. In only one case is the supply of mine labor reported insufficient. Collections are from fair to good, and though not as good as they were at this time last year, are on a par with those of last month. The demand for both foundry and domestic grades of coke continues light, and very little activity is re ported in this market. Most blast furnaces Coke now in blast are covered for their require ments until the first of the year, and the demand for coke as an anthracite substitute fell off after the ending of the strike. A reduction in prices has had apparently little effect on the market. The spot price of Connellsville foundry coke is $4.75 per net ton, which is 50 cents below the quotation of a month ago; and spot furnace coke is now quoted at $3.75, as com pared with $4.25 on September 17. The production of coke during September totalled 3,112,000 net tons and was 127,000 tons less than the output for the preceding month. Since September 8, production has decreased, as will be noted in the follow ing table showing the weekly output in net tons for the past 6 weeks. For purposes of comparison, the output for the corresponding weeks of 1922 is also given. Week ending 1923 1922 September 8 ....................... September 1 5 ............... September 2 2 ............... September 2 9 ............... October 6 ........................... October 13 ................... 345,000 net tons 317,000 “ “ 335,000 “ “ 321,000 “ “ 312,000 “ “ 284,000 “ “ 137,000 net tons 124,000 “ “ 139.000 “ “ 162,000 “ “ 173.000 “ “ 185,000 “ “ i6 T iie B u s i n e s s COTTON Because of such depressing factors as a larger gov ernment crop estimate, dulness in cotton goods, and re_ ports of curtailment of operations in easta .. ern mills, in addition to the movement of the new crop, quotations on raw cotton declined from 30.75 cents a pound for spot middling on September 19 to 28.20 cents per pound on October 8. But persistent buying by mills, strong export demand, unfavorable weather in the south, and bullish private estimates as to the size of the crop and the amount ginned, caused prices to rise again, and on October 23 spot middling was quoted at 30.85 cents per pound. On October 2 the government issued reports of gai nings and of the condition and size of the cotton crop. According to Bureau of the Census figures, cotton ginnings prior to September 25 were only 3,215,394 bales in 1923, as compared with 3,866,396 bales in 1922. The following table shows that although gin nings in Texas were 21.7 per cent larger than they were last year, returns from ‘‘all other states” were 50.2 per cent smaller. R N ovem ber e v i e w during similar periods in the past ten years. Assum ing an average yield of 137.7 pounds per acre, the De partment predicted a crop of 11,015,000 bales. This forecast was 227,000 bales larger than was indicated last month. Of the two main factors that determine price, namely, supply and demand, the latter is now the more uncer tain since the former can be more accurately predicted. Therefore, developments which may affect the world demand for raw cotton will be of great importance in the determination of price. Domestic consumption dur ing August and September, as reported by the Bureau of the Census, was 491,604 and 483,852 bales respec tively in 1923, as compared with 526,380 and 494.013 bales in 1922. Consequently, the total consumption in the United States during the two months ending Sep tember 30 was 44,937 bales less in 1923 than in 1922. But exports of domestic cotton and linters during the same period were 292,652 bales larger this year than last. However, the world’s takings of American cot ton from August 1 to October 19, as indicated by the following figures of the New York Cotton Exchange, were 707,317 bales smaller in 1923 than in 1922. C otton g in n in g s prior to S ep tem b er 25* In running bales 1923 1922 1921 1920 Texas ......................... 2,185.219 1.795.032 1,223,484 1.359.002 All other s t a te s ........ 1,030.175 2.071.364 1.696.908 890,604 Total ........................... 3,215.394 3,866.396 2,920,392 2,249,606 * Department o f Commerce. It was believed that the ginning figures foreshadowed a bullish crop estimate. But the Department of Agri culture announced on the same day that the condition of the cotton crop as of September 25 was 49.5 per cent of normal. As shown bv the table below, this repre sents a decline of only 4.6 per cent during the month, in comparison with an average decline of 6 per cent C on d ition , yield and p ro d u ctio n of raw cotton* Condition Year May 25 1923 ............ 1922 ............ 1921 ............ 1920 ............ 1919 ............ 1918 ............ 1917 ............ 1916 ............ 1915 ............ 1914 ............ 1913 ............ 10-year aver. June 25 71.0 69.6 66.0 62.4 75.6 82.3 69.5 77 5 80.0 74.3 79.1 73.6 69.9 71.2 69.2 70.7 70 0 85.8 70.3 81.1 80.2 79.6 81.8 76.0 Julv 25' Aug. 25 67 2 54 1 70 8 57.0 64 7 49.3 74 1 67 5 67 1 61 4 73.6 55.7 70.3 67.8 72 3 61 2 75 4 692 76 4 78.0 79.6 68 2 72.4 63.5 Final aver. yield per acre (in Sept. 25 pounds) 49.5 50.0 42.2 59 1 54 4 54.4 60 4 56.3 60.8 73.5 64.1 57.5 * Departments o f Agriculture and Commerce, t Estimate as o f September 25. 137.71141.6 124.5 178.4 161.5 159.6 159.7 156.6 170.3 209.2 182.0 164.3 Final Production (in 500 lb. bales) 11,015.0001 9,761,817 7,953,641 13,439,603 11,420,763 12.040,532 11,302,375 11.449.930 11,191.820 16.134.930 14.156 486 13,073,712 S u p p ly and ta k in g s of A m erican cotton * In bales Season of 1923-1924 Season of Season of 1922-1923 1921-1922 Visible supply, American, at end of previous season (July 31). 869.968 1,968.159 4,112,651 Crop in sight, American, on October 19 ................................ 3.578.476 3.929.009 3,385,366 Total ...................................... 4.448.444 5,897.168 7,498,017 Visible supply, American, on October 19 ................................. 2.393,114 3.134.521 4,383.478 W orld's takings of American to October 19 .............................. 2.055.330 2.762,647 3,114.539 * Figures compiled by New York Cotton Exchange. The chart on page 17 shows the rapid increase in the production, domestic consumption and exports of American cotton since 1826. The Civil War caused a sharp but only temporary halt, and after 1865 the in crease was more rapid than before. The peak of con sumption was reached in 1911, when about 16 million bales were consumed. Three years later the largest crop on record was produced. After 1911. exports, which had comprised a larger part of the total world’s takings than had domestic consumption, decreased con siderably, and in recent years this country has con sumed more cotton than it has exported. The fact that during the past two seasons domestic consumption has been considerably in excess of domestic production is also shown. During the greater part of the period from 1826 to date, prices of raw cotton have been less than 15 cents per pound. Peak quotations were reached during the Civil War and in 1919. 1923 T hird F ederal It Is n o tew o r th y th a t exports d u rin g r e c e n t years have been low er th a n a t an y tim e sin c e th e b e g in n in g o f th e presen t c en tu r y . Source—D epartm ent o f Commerce After a period of fairly good buying during the lat ter part of August and most of September, the demand r for cotton yarns has again become rather 0 ton quiet. Many dealers state that prices of ^ yarns during September rose to a point at which manufacturers, in the face of a limited demand for cotton fabrics, refused to buy. Others report that the continued fluctuation of quotations on raw cotton is also responsible for the poor business in yarns. In any casej few branches of the cotton goods industry have bought yarns actively during the past month, and sales in general were small and mainly to fill cur rent needs only. In some cases, however, the demand for underwear and hosiery yarns is reported to have improved. As a result of the slack demand, quotations on cotton yarns have been weak and irregular. Spinners are loath to grant concessions, but sales of stock yams by dealers have been made at reductions in price. A comparison of quotations on October 21 with those prevailing during the latter part of September, shows a decline of from four to five per cent on carded yarns. But recently prices have tended to strengthen again. Some spinners in this district state that operations range from 80 to 90 per cent of capacity and that the supply of labor is either sufficient or plentiful. Collec tions are only fair. Business in cotton goods, both gray and finished, is only fair. The call for the latter has in many cases improved during the past month, but the Cotton demand for unfinished goods has declined. goods Recently, however, sales of gray goods have increased somewhat. Largely because of the fluctuation of quotations on raw cotton, manufacturers and converters are buying gray goods very conserva tively. Moreover, purchasers of finished fabrics, fear- R ese rve D istrict 17 ing that stocks of goods may depreciate in price while in their hands, have also hesitated to order for future requirements. As a result, most of the business on the books is for delivery within the next 60 days. Producers of plush state that sales are fairly good, but even though the demand for tapestry has increased somewhat, it is still comparatively dull. Towels have continued in poor request, and the call for tapes and narrow fabrics has been but fair. Many mills have an nounced their quotations on ginghams for next spring. Competition of southern mills is very keen, and because more attractive prices were named by them, it is re ported they received a larger share of the business than eastern producers. The entire cotton department of a large manufacturer of ginghams in New England was closed for a time, but has been partially reopened. Although some plants in this district have curtailed production during the past month, others have in creased operations and in general mills are running from one-half to three-fourths of their equipment. A few manufacturers are operating at capacity. Unfilled orders are in a number of cases larger than they were last month. Stocks of finished goods and of raw materials are moderate, and the supply of labor is adequate. Owing to resales by second hands, quotations on gray goods have decreased somewhat. However, prices of finished goods are for the most part unchanged. Collections are fairly good. WOOL Continued dulness in the demand for men’s wear piece goods has been reflected in unsatisfactory sales of raw wool in the local market. Dealers, as a™ 00j a rule, state that during the past three weeks the call for raw wool has been but fair, and buying is still mainly for immediate requirements. It is reported that the dress goods and blanket trades have been the best buyers, and that medium and low grade wools have sold better than the finer qualities. Low grade noils have been in fairly good request. Buyers have shown marked resistance to any ad vance in the price of Taw wool, and although quotations in some instances have tended to stiffen, they are for the most part substantially unchanged. Noils, however, have advanced in price. The narrow margin of profit continues to be a cause of general complaint among wool dealers. In spite of the lack of American buying, wool auc tions in foreign countries have continued to manifest strength, largely because of the active demand from continental Europe. Imports of wool into this coun try have decreased sharply, and during September were only 7,882,870 pounds, as compared with 77,047,391 pounds during April of this year and 27,891,522 i8 T he B u s i n e s s pounds during September, 1922. At the present level of quotations in the United States, wool can be pur chased at prices considerably below those prevailing in the foreign market, and as a result the re-exportation of wool from this country has continued. Many spinners report a slight improvement in the call for woolen and worsted yarns during the past month, but buying has been mainly Woolen ana from hand to mouth, and sales have worsted yarns jn the main been unsatisfactory. Weaving yarns for men’s wear, especially, were in poor request, reflecting dullness in the market for piece goods. But because of the activity in women’s wear and of the vogue for knit goods, knitting yarns and yarns for dress goods have been in better demand than yarns for men’s wear. However, some spinners state that recently the new orders for knitting yarns from the brushed wool trade have decreased. The demand for carpet yarns has increased, and a number of spinners are operating most of their equip ment. But many spinners of worsted yarn are running at less than three-fourths of capacity. Nevertheless, wool consumption in this district, as shown by the re plies of 77 establishments, was 18.2 per cent greater in September than in August. It is reported that spindles working on French spun yarns are more active than those that spin Bradford yarns. Spinners state that stocks of raw wool are moderate and stocks of yarn are light, and that both are stationary. Both skilled and unskilled labor are in sufficient supply. Quotations have for the most part been rather weak during the month, and in some instances concessions have been granted. Complaints about the narrow mar gin of profit are general. Collections are fair. Though the demand for woolen and worsted goods for men’s wear has shown little improvement during the past month and is still very poor, Woolen and many fabrics for women’s wear for worsted goods spring have sold quite actively, and the call for fall dress goods to be delivered promptly has been good. The demand for knitted fabrics such as astrakhan and jersey cloth is reported to be excep tionally good. One of the features of the women’s wear market has been the popularity of sport fabrics and fancy goods. In some instances, however, pro ducers of dress goods state that requests to postpone shipments have been received recently. As a rule, bolivias, especially those of the better qualities, con tinue in rather dull request. Because the fall season in men’s wear is practically at an end and orders for light weight goods have been small, many producers have curtailed production and are running less than half of their equipment. Some mills making men’s wear have solicited business in dress goods. On the other hand, many manufacturers of women’s wear are operating at from three-quarters to total capacity. Stocks of finished goods and of raw R N ovem ber e v i e w materials are either stationary or decreasing, but the former range from moderate to light, while the latter are moderate. The supply of skilled and unskilled help has in most instances been adequate. In spite of the poor demand for fabrics for men’s wear, few concessions in price have been reported, and as compared with last month, quotations on woolen and worsted goods are in general unchanged. Collections, in the majority of cases, are only fair or poor. CLOTHING Lines of clothing for the spring and summer of 1924 were opened by many manufacturers during the past t month. Since salesmen have been on the Men s roacj onjy a short time, it is still too ear early to tell how business will compare with last season’s, but reports indicate that retail ers are ordering very conservatively for future needs. Some manufacturers are of opinion that be cause of the unseasonable weather last spring, mer chants have carried over a quantity of light weight goods. As compared with those of the previous light weight season, prices are either unchanged or slightly higher. Producers have had an excellent fall season and at present are completing deliveries on fall orders. Con sequently, stocks of finished goods are moderately light and are decreasing. Stocks of raw materials are moderate. During the month the majority of plants have been running at or near capacity, and the average for this district is about 85 per cent. Operations were in many cases increased, but the supply of labor has been sufficient. Few manufacturers report that collections are good. Makers of shirts have likewise opened their lines for the spring of 1924 and at prices which for the most part are substantially unchanged from those of Shirts last year. Their salesmen have started out on the road to book orders for immediate, holiday, or spring delivery. Business in shirts for early or for holiday delivery is reported to be excellent, and better than that of last year. It is impossible to tell what future business will be, but manufacturers state that the outlook is favorable. Nevertheless, retailers are conservative in placing orders for spring delivery. Many producers in this district are operating at close to capacity. Some scarcity of skilled labor is reported. Collections are fair. SILK Extreme quietness has been the distinguishing feature of the New York raw silk market during the past month. Because they find it difficult to sell Raw thrown silk and silk goods at increased silk prices, manufacturers are unwilling to buy raw silk except as needed. Some producers have cur tailed operations. Moreover, trading in raw silk at 1923 T hird F ederal Yokohama has been resumed, and although shipments to this country from, October 1 to date are consider ably less than normal, they are increasing. Cables from Japan report that the market in Yokohama is quiet and that prices are weak. As a result prices in this country have declined, quotations on Kansai double-extra cracks decreasing from $11.25 to $11.50 per pound on September 19 to $9.00 to $9.05 per pound on October 23. However, on that date prices were about 11 per cent higher than before the earthquake in Japan. As reported by the Silk Association of America de liveries of raw silk to mills decreased from 33,547 bales during August to 26,929 bales during Sep tember. Stocks in American warehouses increased slightly during September, and on October 1 were 27,367 bales. But imports declined from 36,092 bales during August to 28,837 bales during September. In contrast with pure silk, artificial silk is in excel lent request. As shown by the accompanying chart, the production of artificial silk has increased rapidly in recent years, and during the first half of 1923 exceeded the entire output for any year except 1922. In 1914 im ports of artificial silk exceeded the total production in this country, but although diey have increased from the low levels reached during the war, imports are now much smaller than domestic production. Prices of artificial silk have been remarkably stable. During the past month the demand for silk goods D u rin g th e p a st decade, a nd esp ecia lly sin c e 1920 th e p ro d u ction of artificia l s ilk in th e U n ited S ta te s h as in creased con sid erab ly. P r o d u ctio n in r e c e n t years h a s g rea tly exceeded im p o rts a lth o u g h th e reverse w as tr u e in 1914. T h e a m o u n ts fo r 1923 h ave been e stim a te d o n th e ba sis of figures for th e first six m o n th s . Source— Silk Association o f America has ranged from fair to very poor, and, in general, „ buying has been to cover immediate needs * . only. Manufacturers believe that this has goo s j-,een ]argeiy due to the advance in quota tions on silk fabrics necessitated by the higher prices of raw silk. Crepes are still in better request than other R ese rve D istrict L9 weaves. Ribbon manufacturers report that narrow ribbons have been more active than wide ribbons and that picos and grosgrains have sold better than other varieties. Most of the orders on the books are for shipment within the next 30 or 60 days, but in some in stances 20 per cent of the business is for delivery after that period. The amount of unfilled orders is reported to be smaller than it was last month. In consequence of the dull demand, production has been curtailed in a number of cases. Some plants in this district have been placed on a four-day per week schedule, and although a few manufacturers are operat ing at or near capacity, the majority are running only from 40 to 70 per cent of their equipment. At the present rate of production, unfilled orders will on the average insure operations for from 5 to 10 weeks. Stocks of finished goods are only moderate, and stocks of raw materials are light and are decreasing. A few firms state that experienced help is still difficult to obtain, but as a rule the supply of labor is adequate. Reports from 45 manufacturers of silk goods in Penn sylvania show that from August to September the total weekly payroll and the average weekly earnings de creased 2.1 per cent and 1.2 per cent respectively. In spite of the resistance to higher prices, more than half of the producers reporting to this bank state that quotations were advanced during the month, the in crease in some cases being from 5 to 7]/2 per cent. Col lections show little change since last month and in most instances are only fair. HOSIERY The hosiery industry continues in an unsettled con dition, largely on account of the position of silk, which, since the Japanese disaster, has dominated the market. Manufacturers of silk hosiery have not taken a uni form stand in regard to new business; some continue to offer goods for prompt shipment at former prices, but others are asking an advance, not however an advance commensurate with the rise in raw silk, quotations on which during the first half of October were about 35 per cent above pre-disaster prices for October—Novem ber delivery and 20 per cent for December delivery. Subsequently, however, quotations on raw silk eased considerably. The few mills that were fortunate enough to be well supplied with silk purchased prior to September, are for the most part selling at un changed prices and are in an especially favorable posi tion. Some mills which had been carrying stocks of hosiery that threatened to become burdensome have been able to dispose of sizable quantities. On the whole, the volume of business has been considerable. Higher prices, however, are hard to obtain, and some mills are curtailing their output rather than manufac ture at a loss. As no advance has been made in quotations on artifi cial silk, hosiery made in part of this is in increasing de mand, as prices can be named which are more in ac T 20 he B u s i n e s s R N ovem ber e v i e w cord with buyers’ views than are the quotations on pure silk hosiery. In some cases increases in price have been named for mercerized and cotton hosiery; but in these also, price advances are strongly contested by buyers. Nearly all new business, except in children’s and in fants’ wear, calls for early delivery; indeed, neither manufacturer, wholesaler, nor retailer is anxious to make forward contracts. Reports state that longer dating has been given by some manufacturers, but that as a whole collections are fair or good. A few, however, state that the number of slow accounts is increasing. The Department of Commerce reports that 377 mills produced 4,261,994 dozen pairs in August, as com pared with 3,832,613 in July. Unfilled orders fell from 8.139,537 dozen pairs on July 31 to 7,544,310 on August 31, but finished products on hand increased from 6,665,541 to 6,751,998 dozen pairs during the same period. In this district the average of opera tions in September remained at about 70 per cent of capacity. The following table summarizes the reports received by this bank: ous objection to any advance in price; in fact, even July prices, which certain manufacturers will still ac cept, are considered to be too high by some buyers, who though frankly stating that they will require fur ther supplies of underwear, are still holding off. In spring weights similar conditions are reported; those buyers who have already placed orders for a portion of their requirements are showing little in clination to order further, and those who have not purchased are still waiting. Some state that the busi ness outlook for next spring is too uncertain to justify purchases at the present price level. As a result of this hesitation on the part of buyers, few mills are run ning on a full time schedule and many are working at less than 50 per cent of capacity, the average rate of production being about 60 per cent. Skilled labor is reported as scarce by a few manu facturers, but unskilled labor is in sufficient supply. No wage changes have occurred during the period. Collections are either fair or good and are the same as last month. In the following table the reports of firms in the Third Federal Reserve District are sum marized : HOSIERY INDUSTRY T hird Federal R eserve D istr ic t UNDERWEAR INDUSTRY Third Federal R eserve D istrict In terms of dozens o f pairs Sept., 1923; Sept., 1923, compared with compared with Sept., 1922 A ug., 1923 Number of reporting firms— 11 Number o f reporting firms— 30 — 3.6% + 3.7% 4- 6.5“ +106.5 “ + 28.8“ — 10.5 “ — 40.2 “ — 1.0“ +283.6 “ + 9.1“ + 22.2 “ + 9.3“ Number' o f reporting firms— 9 — 4.2% + 1 2 .8 “ — 4.7 “ +27.8 “ + 2 6 .5 “ + 1 3 .7 “ +71.1 “ +25.8 “ +67.5 “ +16.4 “ + 3.2 “ +39.3 “ UNDERWEAR The volume of underwear sales by manufacturers during the past month did not maintain the improve ment shown in the previous month. Orders for winter weights are in fair number, but the individual pur chase is as a rule small, and buyers are making vigor Product manufactured during m o n th ............................................ Finished product on hand at end of month .................................... Orders booked during m onth---Cancellations received during m o n th ............................................ Shipments during m onth............... Unfilled orders on hand at end of month .................................... — 5.6% + 11.3% + + 8.3 “ — 22.3 “ + 72.7 “ —54.9 “ +55.5 “ +113.9 “ +16.2 “ + 52.4“ + .1% + 27.5% —31.2“ C“ T — 7.7“ + 16.2“ —48.7 “ + 7.3 “ + 529.5“ + 26.1 “ —24.4 “ ___________ + 63.6“ „ ■ W in ter underw ear Number of reporting firms— 9 F irm s sellin g to th e reta il trade: Product manufactured during m o n th ............................................ Finished product on hand at end of month .................................... Orders booked during m onth---Cancellations received during m o n th ............................................ Shipments during m onth............... Unfilled orders on hand at end of month .................................... Sept., 1923. Sept., 1923, compared with compared with Sept., 1922 Aug., 1923 S u m m er underw ear F irm s sellin g to th e w h olesale trade: Product manufactured during month ............................................ Finished product on hand at end of month .................................... Orders booked during m onth---Cancellations received during m o n th ............................................ Shipments during m onth............... Unfilled orders on hand at end of month .................................... In terms of dozens Product manufactured during m o n th ............................................ Finished product on hand at end of month .................................... Orders booked during m onth---Cancellations received during m o n th ............................................ Shipments during m onth............... Unfilled orders on hand at end of month .................................... FLOOR COVERINGS The new season for floor coverings opened on Octo ber 1 with the auction sale of 87,000 bales of rugs and carpets of the Alexander Smith and Sons Carpet Company. The new lines of the other manufacturers were also shown in their various warerooms in New l923 T hird F ederal York. Buyers from all over the country were present in large numbers, %nd the bidding at the auction was spirited. The lower grades of tapestry, velvet, and Axminster rugs were in better request than the higher grades, and prices for the former were well main tained. Carpets, however, w rere not in as good de mand as rugs, and some very low prices were recorded. Carpets are now comparatively little used in residences, and therefore the field for them is restricted chiefly to contract sales for the furnishing of hotels and other large buildings. Prices named for the new season show only a very few advances, and these are in the cheaper grades; nor are the declines numerous, except on carpets. The majority of the prices are the same as those of April 1. In some cases in which advances were made after April 1, the new prices have cancelled the increases. On the whole, it may be said that rug quotations are about the same as they were during the past season, as few of the changes exceed 5 per cent. Sales were not as large as they have been at recent openings, and this is especially true of Wiltons and Axminsters. For the last few years a number of mills have been able to sell their entire output for the com ing six months within a few days after the opening of the season; but this year such cases are few, and it will be necessary to send salesmen on the road to secure business. Many buyers are stipulating that goods shall not be shipped until November or Decem ber, which would indicate, that in some establishments stocks are not as low as was thought. It must not be inferred, however, that the total of orders placed was small. Many mills are well supplied with business and are running at capacity, and several mills in this district are running more than one shift of men, especially those that make tapestry and velvet rugs. Axminster mills are for the most part running at capacity, but a number of the Wilton looms are not busy. It should be remembered in this connection that there has been a considerable increase in the number of Axminster and Wilton looms during the past two years, and that if they were all active, production would be larger than ever before. Mills that manufacture carpets only have had to make considerable price concessions in their new lists, and some manufacturers claim that their present quo tations will mean a far from satisfactory business. Most mills are well covered on raw materials. Prices of these, with the exception of jute, are firm, and in the case of wool yarns, are higher than they were a month ago. Labor is in sufficient supply, and collections are good. The opening of linoleums for the new season took place simultaneously with the openings of carpets and rugs. Prices in nearly every case were the same as those of last spring. The volume of new orders is large, and business shows no sign of falling below that of last season, when production is said to have R eserve D istrict 21 reached a new high record. As improvements and extensions have recently been made in several of the plants in this district, the present rate of production is now greater than ever before. A good export de mand from Great Britain and Australia is reported for felt-base goods. The consumption of flaxseed in this country has increased sharply during this year, and was 475,485 tons in the first half of 1923, as compared with 284,326 tons during the same period of 1922. Linseed oil, which is the product of flaxseed, is in heaviest demand for the manufacture of paints, but the making of lino leum consumes large quantities also, and both of these industries have been prosperous during the past year. The accompanying chart shows that following the post-war boom in 1919 the price of linseed oil fell for about two years, and that production of flaxseed de creased for two years, from 1920-1922. When, how ever, prices of oil rose again in 1922 and early 1923, production of seed in 1923 increased also and was .greater than in any year since 1915. But the average production this year is not as large as was the aver age for the five pre-war years, 1909-1913. In the United States the 1922 crop of 19,623,000 bushels was the largest since before the war, but was still less than half that of the Argentine, which in 1923 was 44,284,000 bushels. The price for linseed oil in tank cars averages from 5 to 7 cents per gallon less than the price for carload lots which is used in the chart. LINSEED OIL AND FLAXSEED J K 1914 1915 1916 1917 1918 1919 1920 1921 1922 1923 T h e price o f lin seed oil an d th e p r o d u ctio n o f flax-seed sh o w ed lit t le rela tio n sh ip d u rin g th e years of th e w ar, b u t in 1919 th e h ig h price o f o il w as follow ed by a large in crease in th e n e x t seed crop. S in ce th e n th e price o f o il h a s b een reflected in th e seed crop o f th e follo w in g year. Sources— Oil, Paint and Drug R eporter, D epartm ent of A griculture, D epartm ent of Com m erce Prices of raw materials are in some instances below those of six months ago; linseed oil is decidedly lower, and jute slightly lower. Linseed oil, however, is at present higher than it was a month or six weeks ago. Collections are in general good, but some firms re port that they are slow. 22 T he B u s i n e s s R N ovem ber e v i e w LEATHER Hides have continued active during the past month, and sales by the packers have kept pace with produc... , . tion. That buyers are resisting any adHtdes and vance in price is evident, for notwith skins standing the activity of the market, quotations on most selections are unchanged from those of a month ago. The only increases are y2 cent to 15 cents for heavy native steers and J4 cent to \?yA cents for spready steers; on the other hand, branded and light native cows have each declined ]/A cent to 9 / 2 cents and 12 cents respectively. The sup l ply of calf skins also has been closely bought, and prices are higher by about y2 cent per pound than they were a month ago. Goat skins, which rose quite sharply in price last month, following large purchases in several of the foreign markets, have become dull, and tanners are not interested at the higher quotations. The leather markets show only a slight change from conditions previously reported and are in general dull. In some quarters an improved call for Leather offal is noted, but purchases of most de scriptions of heavy leather are in small lots and at a concession in price. Competition to sell is if anything more acute than it was last month, and it is difficult to quote with any accuracy the actual prices at which sales of importance are made. In August, according to the following table com piled from the report of the Department of Commerce, business appears to have been better than was realized at that time, for although production of leathers, ex cept cattle side upper, increased as compared with July, stocks at the end of August were lower, with the one exception of backs, bends, and sides, and the stocks of these increased less than the gain in production. Even so, they stood at 9,901,820, the largest figure since Sep tember, 1922. STOCKS OF BELTING BUTTS 1920 1921 1922 1923 T o ta l s to c k s of b e ltin g b u tts h ave b een in c r e a sin g d u r in g 'm o s t of th e p r e se n t year, b u t s to c k s in th e h a n d s of b e lt-m a k e r s, how ever, w h ic h rep resen t b u t a s m a ll p ercen tage of th e w hole, have . b een decreasin g. Source—D epartm ent of Com m erce demand, especially in black, but sales are smaller and the supply larger than they were a month ago. Calf grain leathers also are selling well, and an increased call is noted for women’s weights in black. Sales of kid were small during the first part of October, but demand for black kid has since increased somewhat. Low grades are in the best demand, and stocks of these in tanners’ hands are light; but stocks of medium grades are of good size, and to move these price cut ting is usually necessary. Some tanners report that they are oversold on top grades, but others report that these are not selling well, especially in the lighter weights. Brown kid has not been in as good demand as black. Patent leather continues to move in fair quantity but in small lots. Collections are good. Shoe factories in this district have in many cases finished their fall run, and salesmen are on the road with spring samples. In the factories makStocks at end of August, 1923, as compared Production during month with July, 1923 month Shoes ing fine shoes for women the orders on hand are small and unless new business is booked, production will be curtailed. Makers of Backs, bends and sides. + 4.4 +2.6 Belting butts ............... —5.1 - f 3.8 children’s and infants’ shoes have received some Offal, sole and belting. — 2 .0 + 6.8 spring business, but as a whole, forward business is —1.4 Cattle side, upper......... —10.3 —5.4 Calf and kip ............... small and the total of orders on the books is said +15.2 Goat and k id ................. — .9 to be less than at the same period of 1922. Shoe — 4 .y < Cabretta ........................ —2.8 prices are fairly steady, but one of the largest makers of shoes has announced reductions ranging from 5 to * Production figures not separated. 15 cents per pair on the price of men’s work-shoes, The accompanying chart shows that the total stock and some other makers of men’s shoes have shaded of belting butts on hand and in process, although ■quotations. it decreased during August for the first time this year, The Department of Commerce reports that produc is still large. At the end of July it was at the highest tion totalled 29,853,373 pairs in August and 243,056,929 during the first eight months of 1923. These figures point for the last three years. Upper leathers are more active than heavy leathers, compare with 27,675,986 and 207,293,245 for the same but in these too the buying is principally in small lots periods of 1922. This increase of more than 35,000,000 for prompt delivery. Calf skins in suede are still in pairs in eight months would indicate that even though T 1923 hird F ederal the preliminary report of September production shows a decrease of abou+9.3 per cent as compared with the August figure, the production this year will be con siderably larger than in any year for which records exist. The output in 1922 was only slightly over 8,000,000 pairs less than in the record year of 1919. Collections are said by most manufacturers to be either good or fair, and the number reporting slow col lections has decreased as compared with last month. In the Third Federal Reserve District the production of shoes by reporting firms during September, as shown in the following table, decreased 15.6 per cent as com pared with August, but was 3.7 per cent larger than in September, 1922. ROOT AND SHOE INDUSTRY Third Federal R eserve D istrict Number o f reporting firms— 30 Sept., 1923 I Sept., 1923 compared with compared with A ug., 1923 | Sept., 1922 (In terms of pairs) Product manufactured during month Shipments during month ................. Orders booked during m onth......... Orders on hand at end of month. . . Cancellations received during month Stocks (unsold) on hand at end of month .............................................. — 15.6% —16.3 “ +15.9 “ — 8.0 “ —51.2 “ + 3.7% + 6.7 “ —33.4 “ + 9.8 “ 4-60.5 “ — 9 .7 “ + 3.8 “ Sales of shoes at wholesale continue in fair volume, but business is reported as spotty. The unfavorable weather of this month has caused some retailers to hesitate to buy further, as their stocks have not moved freely. From the table on page 9 it will be seen that sales in September were larger by 8.1 per cent than RETAIL SHOE TRADE T hird Federal Reserve D istrict (In terms of dollars) 1. N et sales: (a) Sept., 1923, as compared with Aug., 1923. . 4-22.6% (b) Sept., 1923, as compared with Sept., 1922.. — 1.9“ (c) July 1 to Sept. 30, 1923, as compared with July 1 to Sept. 30, 1922............................ — 3.4“ 2. Stocks (selling price): (a) Sept., 1923, as compared with Aug. 1923... . —18.3% (b) Sept., 1923, as compared with Sept., 1922.. -j- 8.0" * 1 3. R ate'of turnover (tim e s per year based on c u m u la tiv e period): (a) July 1 to Sept. 30, 1923.................................... (b) July 1 to Sept. 30, 1922........... ........................ Number of stores 1‘eporting above item s: 1................. 19 2 and 3 . ...............17 2.7 2.4 R eserve D istrict 23 in August, but were smaller by 2.7 per cent than in September, 1922. This is the first month since April during which sales have failed to show an increase as compared with the same period of 1922. Retail sales of shoes fell off sharply during the latter part of September, and the early promise of an in crease in business as compared with September, 1922, was negatived. During October the clear, warm weather has retarded sales, and unless there is an im provement in the last week in the month, the volume may not be as large as it was last year. The following table shows that sales by reporting firms in September were seasonably larger than in August. The increase was 22.6 per cent, but as compared with September, 1922, they decreased 1.9 per cent. Stocks at the end of September were considerably larger than on that date last year. PAPER Most grades of paper are in better request than they were a month ago, but only in the book and fine paper grades has the demand shown a marked increase. Coarse papers, such as wrapping and kraft, are in only slightly greater call than last month, and the mills making these grades state that business is rather poor. Glazed paper and wall papers are in good demand, and manufacturers of these are working at capacity. Book and fine papers are selling in greater volume than they did during September, and the mills are operating at about 80 per cent. Toilet tissues, and crepe towels and tissues are in poor request; consequently, makers of these are operating at only 50 or 60 per cent of capacity. The demand for building papers and building boards has declined sharply, and manufacturers report that new orders are small. Paper converters, particularly envelope makers, report that their products are in good request, and envelope factories are operating at 80 or 85 per cent of capacity. Box board mills are busier than they were a month ago, and news and chip boards are selling in fair volume. In general, the demand for paper is fair, and most manufacturers report that it is equal to or slightly greater than it was in October, 1922, However, practically all of the orders received by the mills are for shipment within 60 days. Jobbers report that their sales show an increase over those of September and on the whole are satisfactory. Book and fine papers have been selling most actively, but wrapping papers are moving in slightly greater vol ume than they did last month. They state, however, that consumers are still buying only from hand to mouth. Prices of book and fine papers are holding firm, but quotations on coarse papers, such as wrapping and krafts, and on tissues are weak. Several manufactur ers of the latter grades have reduced their prices about 5 per cent or are offering concessions. Imported and domestic chemical pulps are firm, and concessions in 24 T he B u s i n e s s price have practically disappeared. Mechanical pulp quotations remain unchanged. Finished stocks at most mills are moderate, although coarse paper stocks are somewhat heavy and are in creasing slightly. Mill stocks of raw materials are moderate. , Envelope manufacturers report some difficulty in ob taining girl workers, but at paper mills the supply of both skilled and unskilled labor is sufficient. Wages are unchanged. Collections vary from fair to good and are much the same as they were last month. PAPER BOXES The demand for chip and newsboard boxes is con siderably better than it was in August and September, and consequently production is greater. Candy boxes for the Christmas trade are in excellent request, and the call for boxes from the hardware, foodstuffs, and electrical supply industries is good. Shirt makers and underwear manufacturers are buying larger quantities than they have for many weeks, but the shoe and hosiery industries are placing only small orders. Pro ducers of perfumes are purchasing heavily, and all kinds of holiday boxes are in good request. Opera tions at chip and newsboard box factories in this dis trict now average about 85 per cent of capacity. The demand for fiber shipping containers and corrugated boxes, however, is rather light and for this season of the year is poor. Manufacturers of these grades are working at only about 70 per cent of capacity. Prac tically all orders are for delivery before the close of the year. Prices of chip and newsboard boxes are slightly stronger than they were last month, and price cutting is not as severe as it was in August and September. Shipping containers and corrugated boxes are from 5 to 7 per cent lower than they were last month. Chip and newsboard have held firm at $55 per ton, but con cessions are being offered on straw board and jute liner. Stocks of finished boxes at most factories are moder ate and are increasing slightly, as big deliveries on holiday orders will not be made until next month. Supplies of board, too, are moderate. Many factories report that both skilled and unskilled labor is scarce. Girl workers are especially difficult to obtain. Some manufacturers are offering slightly higher wages, but in most factories wages remain un changed. Collections are from fair to good and the same as they were last month. TOBACCO Packers of Pennsylvania tobacco report that the demand for 1922 leaf is greater than it was in Sep R e v i e w N ovem ber tember. Large manufacturers have been the principal buyers, but the smaller mak ers, too, have entered the market. Dealers state that the heavy frost which damaged the 1923 Ohio and Wisconsin crops severely, has stimulated buying in the Lancaster market. Prices for 1922 Penn sylvania wrappers range from 25 to 32 cents per pound and for 1922 fillers from 12 to 18 cents. The 1923 crop of Pennsylvania tobacco is larger than last year’s, and the tobacco is reported to be in better condition than in 1922—more leafy and of healthier appearance, and less damaged by hail and beetles. As yet, very little of the new crop has been sold by the growers, but the few sales that have taken place were at high prices. Fancy wrappers in the bundle were sold at prices ranging from 25 to 28 cents per pound, less choice wrappers at from 18 to 25 cents, and fillers at 8 cents per pound. The Connecticut, Massachusetts, and New York to bacco crops are larger than they were last year, but on account of heavy frosts last month the Ohio and Wis consin crops are smaller. On September 1, conditions indicated that the total cigar tobacco yield would be 20 per cent greater than last year’s, but on October 1 the estimated yield was only, 10 per cent greater. The following chart shows how the 1923 crop compares in size with that grown in the principal cigar leaf pro ducing states last year. Tobacco leaf T h e to ta l p r o d u ctio n o f cigar le a f In th e six n o rth ern p rod u cin g sta te s is 10 per c e n t greater th a n la s t year, b u t 8 per c e n t below th e te n -y ea r average. Sou rce—D epartm ent of Agriculture Sumatra inscriptions, held at Amsterdam this month, attracted little attention from American buyers. Only a small percentage of the tobacco offered was suitable for the American market, as most of the grades offered were of the dark or medium colored variety. Most of the clean light wrappers of the 1922 packing are now in American manufacturers’ hands. 19 23 T hird F ederal Cigars are in better request than they were'a month ago, but several manufacturers report that the orders booked are not as large as they were in Cigars October, 1922. However, the demand is good and production is greater than it was in September. Orders for the Christmas trade are still being received in considerable volume. The five-cent cigar has shared but little in the improvement, but Class B, C, and D cigars are moving actively. Large manufacturers are operating at close to capacity, and small producers at about 80 per cent. Practically all orders are for delivery within 60 days. Jobbers re port that buying for immediate needs is greater than it was last month, and that in general their sales are good. The output of large cigars in September was less than in September, 1922. The following chart, based upon sales of internal revenue stamps, shows that Class C grades were the only grades in which there was a considerable increase in output. PRODUCTION OF CIGARS AND CIGARETTES MILLIONS i* Cigarettes 6,000j T he to ta l p r o d u ctio n o f large cigars In S ep tem b er w as sm a ller th a n in Sep tem b er, 1922. Source— Commissioner o f Internal Revenue Cigar prices remain firm and are unchanged. The injury caused to the Ohio and Wisconsin crops by frost has affected tobacco leaf prices. Practically all grades of 1922 domestic cigar tobaccos are higher now than they were on September 1. Stocks of cigars at most factories are moderate but are decreasing. Manufacturers who cover the far West and Pacific coast are making heavy shipments to those districts on Christmas trade orders. The sup plies of raw materials held by manufacturers are heavier than they were a month ago, because of heavy purchases of tobacco by the large factors during this month. Some scarcity of both skilled and unskilled girl workers is reported by several producers, but in gen eral the labor supply is sufficient. Wages remain un R eserve D istrict 25 changed. Collections vary from fair to good and show little variation since September. AGRICULTURE Favored with ideal weather this month, despite an acute shortage of farm labor, the harvesting of crops throughout the district has progressed rapidly. Prac tically all of the corn has been cut; peach, apple, and pear picking is almost completed; and a considerable portion of the late potato crop has been dug. Fall plowing is well advanced, and winter wheat plantings are about two-thirds completed. Reports from county agents state that farmers are not planting as large acreages of wheat as they did last fall, and according to their estimates the sowings this year will be 15 per cent less than in 1922. The low prices growers have received for this year’s wheat have undoubtedly caused this reduction. Estimates of yields made by the Department of Agri culture from the condition of crops on October 1 indi cate that production of potatoes, hay, and buckwheat will be greater than was in prospect on September 1, but the corn crop will be smaller. Estimates of the total production of other crops were about the same as on September 1. The preliminary estimate of the yields of oats and of Pennsylvania tobacco is much greater than the estimate made from the condition of the crops at the beginning of September. The table on page 26 shows the Department’s estimates of yields on Octo ber 1, 1923, September 1, 1923, and for the year 1922. This has been a very good season for fruit growers. The crops are large and with the exception of apples considerably heavier than they were last year. The quality of the fruits is above the average, and in color, size, soundness, and texture they are much superior to the 1922 crops. In Pennsylvania, the commercial F R U IT PRODUCTION PENNSYLVANIA, NEW JERSEY AND DELAWARE WWi Average 1918-1922 1922 ■ ■ 1923 ------------- A lth o u g h sm a lle r th a n in 1922, th e app le crop is a b o u t eq u a l to th e average o f th e la s t five years, b u t th e peach and pear y ie ld s are larger th a n la s t year and con sid erab ly above th e average. Source—Departm ent of Agriculture T 26 he B R usiness eview N ovem bei ESTIM ATES OF CROP YIELDS (In th o u sa n d s of u n its) Pennsylvania N ew Jersey 1923 Crop 1923 From condition From condi on Oct. 1 or tion on preliminary Sept. 1 Corn ..................... 61,315 bus. Oats ...................... 34,481 “ Buckwheat ........... 4,428 “ Potatoes .............. 22,844 “ 237 “ Sweet potatoes .. Hay (tam e) ........ 3,208 tons 62,505 lbs. Apples (total) .. 10,521 bus. Apples (commer1,227 bbls. cial crop) ......... 604 bus. Pears .................... 1922 62,062 bus. 69,212 bus. 31,996 41,242 “ 4,434 “ ' 5,203 “ 20,539 “ 28,512 “ 280 “ 235 “ 3,018 tons 4,880 tons 57,408 lbs. 56,760 lbs. 10,521 bus. 11,400 bus. 1,227 bbls. 526 bus. 1,216 bbls. 576 bus. From condition From condi on Oct. 1 or tion on preliminary Sept. 1 1922 From condition From condi on Oct. 1 or tion on preliminary Sept. 1 1922 9,192 bus. 1,728 “ 176 “ 6,960 “ 2,250 “ 328 tons 9,416 bus. 9,912 bus. 1,682 “ 2,232 “ 220 “ 153 “ 6,360 “ 16,435 “ 2,322 “ 3,500 “ 312 tons 485 tons 6,143 bus. 182 “ 74 “ 803 “ 954 “ 96 tons 6,143 bus. 176 “ 77 " 724 " 934 82 tons 5,439 bus. 161 “ 76 “ 960 “ 1,720 “ 116 tons 2,014 bus. 2,045 bus. 2,610 bus. 780 bus. 859 bus. 980 bus. 436 bbls. 637 bus. 210 bbls. 443 bbls. 629 bus. 220 bbls 522 bbls. 405 bus. 200 bbls. 218 bbls. 208 bus. 240 bbls. 221 bus. 213 bbls. 158 bus. crop of apples will be larger than last year’s despite a smaller total yield, and in New Jersey and Delaware the percentage of the crop suitable for marketing is also much larger. The chart on page 25 shows how the fruit crops of the three states in which the Third Fed eral Reserve District lies and those of the United States compare with last year’s and with the five-year average. Plenty of rainfall in late August and during Septem ber has produced good pastures and slightly larger crops of hay. Consequently dairy herds are in better condition than they were on September 1. Although bran, cottonseed meal, and most mill feeds are lower now than they have been at any previous time this year, hay is higher than it has been at any time since 1921. The dairymen who are obliged to buy hay are realizing smaller returns on their herds than they re ceived in June; but, in general, the dairy industry is C a ttle feed s are fu lly 33 per c e n t ch ea p er th a n In th e fa ll o f 1920, b u t th e price paid to p rodu cers for m ilk , is o n ly 18 per c e n t low er. Sources—In tersta te M ilk Producers’ A ssociation, D epartm ent of Agriculture, Dun’s R eview Delaware 1923 1 prosperous and in much better condition than it was during the extreme period of inflation in 1920. As the preceding chart shows, dairy feeds are about 33 per cent cheaper than they were in the fall of 1920, but milk prices are only 18 per cent below the peak prices of that year. On many farms of the district, hog killing has begun and the movement of hogs from the farm to the markets is larger than it has been for several months. However, county agents report that slaughters and sales to butchers show little if any increase over those of last October. Despite no increase in killings, the number of hogs on the farms of this district is gener ally reported as being smaller than in October, 1922. New crop hogs are in good condition and are normally Sources— Bureau of Labor Statistics, D epartment of Agriculture 1923 T hird F ederal developed for this season of the year. Rather heavy shipments from the principal hog- raising states have forced prices of hogs down, but corn has been steadily advancing. With corn close to wheat in price and hog prices at such a low level, it will be more profitable for many farmers to market their corn in bulk than in the form of pork. The chart on page 26 shows that corn prices are approaching the level of all commodi ties, but that hog prices are further below that level than at any time in the past decade. Farm labor is still in short supply and is no more plentiful than it was a month ago. The New Jersey and Pennsylvania Departments of Agriculture have computed the average wages paid farm labor this sea son, and their figures show that wages are only 2 per cent less than the wages paid in 1920, which were the highest ever paid. The 1923 wage rates are 100 per cent higher than those of 1916 and from 20 to 30 per cent higher than the averages for 1921 and 1922. The following are the average wages paid this season: R D eserve Class of labor Hired Hired Hired Hired by by by by 27 istrict month, with board................. month, without board........... day, with board..................... day, without board............... Pennsylvania | New Jersey $43.00 62.00 2.85 3.60 $52.00 74.00 2.85 3.90 In general, the rates paid in New Jersey were higher than those paid in Pennsylvania, but in the former state the shortage was more acute than in the latter. The supply in New Jersey is estimated to have been 24 per cent smaller than the average or normal supply and that in Pennsylvania 20 per cent smaller. Considering the adverse factors, the crop season is closing more favorably than had been anticipated a few months ago. On account of the long drought of the summer it was inevitable that the yields of many crops should be small, but favorable weather during late August and September helped the late crops consider ably. And most of them have been harvested in good time, despite a great scarcity of labor. COM PILED AS OF OCTOBER 23, 1923 This business report will be sent regularly without charge to any address upon request WHAT THE RESERVE RATIO MEANS Every week the Federal Reserve Board announces through the press a statement of condition of all twelve Federal re serve banks, showing their principal assets and liabilities, and also showing what is known as the reserve ratio, or reserve percentage. This reserve ratio frequently is singled out for editorial comment, and is often considered an indicator of the state of credit throughout the country. But for its proper interpretation, it is necessary to understand the circumstances which influence it at all times, and to make allowance for such special conditions as may occasionally prevail, for exam ple the recent large importation of gold. Generally speaking, a reserve is a fund set aside for emer gency use. Reserves are maintained by business men as well c.. r as by banks. But in the case of banks the , , law specifies what reserves shall be mainan reserves tained, for the better protection of their depositors. The amount of reserve required for a bank which is a member of the Federal reserve system depends on the size of the community in which the bank is located and the nature of its deposits. On the average throughout the coun try the reserve required for a member bank is about 10 per cent of the amount of its deposits payable on demand. In the same way, reserve banks must keep in reserve a cer tain proportion of their funds, and because of the fact that the reserve banks carry reserves for other banks, the per centage is much higher—35 per cent of the amount of their deposits, and 40 per cent of the amount of their Federal re serve notes in circulation; but for purposes of convenience and ease of reference the published reserve percentage is a single figure. This figure is the proportion which the total reserves bear to the amount of both deposits and notes. Thus a 75 per cent reserve ratio (or percentage) means that the reserve banks have reserves in gold or lawful money which amount to three-quarters of the sum of their deposits and notes. The reserve ratio of the reserve banks may therefore be affected by any one of three factors,—a change in the amount E lem e n ts in casb reserves> a change in the amount of th e ra tio n° te *ssues> or a change in the amount of deposits. Changes in the cash reserves, however, affect the ratio more than do changes in either of the other two items. This may be illustrated best by an example. On October 18, 1923, the cash reserves of the reserve banks were $3,198,000,000. Deposits were $1,975,000.000, and notes in circulation $2,272,000,000. The reserve percentage is computed from the fraction 3,198,000,000 3,198,000,000 2,272,000,000 plus 1,975,000,000 4,247,000,000 which equals 75.3 per cent. It is clear, arithmetically, that an increase or decrease of $100,000,000 in cash reserves, shown above the line, affects the percentage more than a like change in deposits or notes, shown below the line. This always holds true as long as the reserves are less than deposits plus notes. Under ordinary circumstances of world trade it is probable that the stock of gold in the country would not vary greatly, E ffe c t o f h ea vier or certainly not to the extent that has lig h te r c re d it d e m a n d s occurred in recent years. Ordina rily the principal changes would take place in the figures below the line, namely in the reserve bank deposits and note issues. The way in which such changes would come about, and the reserve ratio be thereby affected may be illustrated by the following example. A merchant of Read ing, Pa., finds his business growing, is in need of additional funds with which to increase his stock of goods. He goes to his bank and obtains a loan, part of which he may wish to re ceive in the form of a deposit credit against which he may draw checks, and part of which he may wish to receive in currency. If his bank’s reserve is high, it may be able to sup ply him without borrowing. But if business is exceptionally active the bank itself may have to borrow in order to accommodate the merchant and its other customers. It borrows perhaps $100,000 at the reserve bank of its district, receiving in return Federal reserve notes or a deposit on the books of the reserve bank which under the law serves as reserve against the increased deposits of its customers. The reserve bank does not pay out or part with any of the cash composing its reserve, but the aggregate of its deposits and notes is increased $100,000 and the reserve ratio is proportionately lowered. Conversely, when business activity is diminishing, the Read ing merchant and many others like him, are paying off their loans at their banks and at the same time currency is being released from circulation and deposited in the banks. W ith these receipts the banks in turn reduce their borrowings at the reserve banks. The cash composing the reserves of the reserve banks is not increased, but their deposits and notes are decreased, and the reserve ratio is proportionately raised. Thus if conditions were such that the gold reserve remained practically stationary, the reserve percentage would reflect directly the changing needs of business and agriculture. Its lowering would mean a growing volume of commercial activ ity, accompanied by an increased credit demand upon the banks and a gradual narrowing of the margin of available credit. Its rising, on the other hand, would mean a slacken ing pace of industry, an easing in the credit demand, and a replenishing of the credit reservoir. But present conditions are not such that the gold reserve of the Federal reserve banks remains stationary. In the past vet i t u three years it has increased more than fmpn n trst/n li.npn r ts a , billion dollars,’ Poetically all of im o r o r e x o r ts ■, . . f. f which represents importations of gold. In the early stages of the gold movement, when the gold found its way into the reserve banks it paid debts owing by the member banks; latterly it has permitted the member banks to increase their deposits to the highest point ever reached and at the same time to maintain the reserves that the law requires with very little borrowing from the reserve banks. The combined effect of these huge gold imports, increasing the reserves, and of simultaneous heavy redemptions of Fed eral reserve notes, decreasing the liabilities, has been to bring about the present reserve ratio of about 76 per cent, which compares with the ratio of 85 per cent when America entered the war and the ratio of 42.5 per cent in the autumn of 1920 when the credit strain was at its peak. The present high reserve ratio, then, is in large part due to the recent flow of gold to the United States from countries which for the time being are not on the free gold basis which obtained before the war. A return to such a basis, under which gold would flow freely into or out of such countries in settlement of international balances, would, if our balances were adverse, cause a corresponding outflow of our gold. This would decrease our reserve ratio, exactly as recent im ports have increased it.
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