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THE BUSINESS v *v 4.v/,... FEDERAL RESERVE RANK•7c OF PHILADELPHIA NOVEMBER 1, 1941 Productive and distributive activity in the Third Federal Reserve District has been maintained at unusually high levels, owing to increasing defense work and heavy consumer demand. Recent gains have been somewhat smaller than seasonal and less extensive than prevailed in several earlier months, as the sustained rise since the first of the year has brought current operations in many lines of manufacturing near capacity and heavy antici patory buying in wholesale and retail channels during the summer pushed sales to record volumes. Employment and income were well sustained in September. At factories, payrolls and the num ber of workers continued at the record highs reached a month before, while substantial gains were reported at trade establishments. Some increases in factory wage disbursements occurred in October. Sales of goods by retail and wholesale estab lishments generally have advanced further, al though in many lines the gains have been smaller Both industry and trade are meeting increasing than is usual at this time of year. Especially difficulties in getting supplies of materials and heavy buying was in evidence during the summer, labor. The effect of priorities and direct curtail and recent levels also have been above 1940. ment programs has been to restrict operations in Inventories in retail lines and at some wholesale several industries. As the supply of some basic con establishments have been expanded sharply dur sumers’ goods is not keeping pace with expanding ing the past twelve months. Owing to a heavy incomes and demand, prices continue to rise. movement of freight in preceding periods, rail Industrial production has been maintained at shipments this fall have advanced less than usual. the peaks reached late in the summer. Manufac The movement of nearly all classes of freight is turing activity has increased further, particularly much heavier than a year ago. in such durable goods as metals and transporta The commercial demand for bank credit in this tion equipment. The output of crude oil has also expanded more than was to be expected seasonally. District has recently declined slightly, following a Mining in both the anthracite and bituminous fields sustained sharp rise. Holdings of Government has increased, but the gains have been smaller than securities, on the other hand, have expanded. usually occur at this time of the year, owing partly Cash payments for a recent issue of Treasury se to work stoppages and partly to an accumulation curities and other receipts by the Treasury have of supplies during the summer months. The out been primarily responsible for a decline in mem put of electric power also has advanced slightly ber bank reserves. Balances carried with this less than seasonally. Bank and with correspondents, however, are still Awards of building contracts in September were heavy. Prices of long-term Treasury and corporate the largest for the month since the late 1920’s. bonds advanced somewhat in October, while prices Construction work on factories, stores, and homes of stocks are somewhat below the levels prevailing is sharply above the levels prevailing a year ago. a month and two months ago. Page One PRODUCTION AND PRICES FACTORY PAYROLLS PENNSYLVANIA PERCENT PERCENT PRODUCTION*1 CAPITAL - GOODS COST OF LIVING IN PHILADELPHIA CONSUMERS' - GOODS ■ WHOLESALE COMMODITY PRICES U S. * Adjusted for seasonal vat-lit ic 1936 1937 1938 1939 1940 1941 1936 1937 1938 1939 1940 1941 ______________________ Manufacturing. The demand for manufactured goods in this District remains active. Orders for defense equipment and commitments to fill essen tial civilian needs have expanded further. The volume of new buying in numerous other lines has continued to slacken, as growing shortages of materials and a scarcity of production facilities make it increasingly difficult to obtain delivery. Factory operations are sustained at levels gen erally well above other recent years. The volume of unfilled orders for defense goods in some in stances has reached new peaks, and backlogs are considerably heavier than in the fall of 1940. Inventories of finished products are still declin ing in both capital and consumers’ goods indus tries. Supplies of raw materials are being drawn upon heavily, but are larger than a year ago at most plants; at steel mills the shortage of scrap has become acute. The replenishment of raw stocks is increasingly difficult, owing to priorities and allocations to the defense industries. Employment in Pennsylvania factories in Sep tember continued at approximately the August peak of 1,150,000 workers. The volume of wage disbursements also remained at the record high of about $35,000,000 a week, and was larger than was to be expected seasonally in steel, leather, and several other major lines. Some decline was reported at textile mills. Increases over a year ago in employment and payrolls were 21 and 43 per cent respectively. Compared with the pre war level of August 1939, the number employed showed an increase of nearly 34 per cent and the amount of wage disbursements a gain of 77 per cent. Preliminary reports for October indicate further increases in payrolls. Page Two The greatest expansion in activity continues in durable goods lines, where employment in Sep tember was 32 per cent and wage payments 58 per cent above 1940. Increases were especially pronounced at plants producing transportation equipment, iron and steel, and nonferrous metal products. In nondurable goods industries, em ployment and payrolls have risen about 7 and 18 per cent respectively in the past twelve months, some of the sharpest increases being at woolen and worsted mills, canning factories, and estab lishments making chemicals and leather goods. Earnings of factory workers in Pennsylvania increased to a new high in September, averaging 82 cents an hour as against 73 a year earlier. Working time, however, decreased somewhat from August to an average of dCd/a hours a week, so that average weekly income declined slightly to $33.16. This was $5.40 above last year and over $6.00 above the average for 1929. In Delaware factories the number employed in creased nearly 3 per cent from August to Sep tember and wage payments advanced 2 per cent. Employment in southern New Jersey increased about 3 per cent and payrolls over 5 per cent. The output of factory products in this District advanced slightly to a new peak in September and was 29 per cent higher than a year ago. On a seasonally adjusted basis the production of dur able goods increased 5 per cent from August to September, but in consumers’ goods lines output declined about 6 per cent. The heavy industries, including those turning out transportation equip ment, metal products, and building materials, con tinue to show the sharpest gains over 1940. Substantial increases, however, also have occurred in the output of lighter goods. ACTIVITY IN THE STEEL INDUSTRY BUILDING CONTRACTS EMPLOYEE-HOURS IN PENNSYLVANIA PHILADELPHIA FEDERAL RESERVE DISTRICT MILLIONS PERCENT STEEL CONSUMING INDUSTRIES " STEEL PRODUCING — INDUSTRIES - TOTAL RESIDENTIAL INDUSTRIAL 1936 1937 1936 1939 1940 1941 1936 937 1938 1939 1940 1941 The production of electric power increased somewhat less than seasonally in September but was sharply greater than in the early fall of 1940. Building. Construction activity in this District in September continued at the highest levels in recent years. Awards of new contracts expanded, reflecting chiefly heavy commercial placements. Coal and other fuels. The market for fuels is Under the policy announced by the Supply Prior well sustained. Sales of bituminous coal continue ities and Allocations Board, new construction re substantial, owing to heavy industrial require quiring appreciable quantities of critical materials ments for fuel. The demand for anthracite has will be permitted only if necessary for national de not shown the usual seasonal increase, because of fense or essential for the public welfare. Wholesale mild weather and inventory accumulation during prices of building materials have increased further the summer months. Exports of coal this year and are now the highest since the 1920’s. have been smaller than in 1940. Prices generally Contract awards expanded 43 per cent in Sep continue firm. tember to $37,900,000 and were the largest for Production of anthracite increased less than was to be expected from August to September and de clined somewhat in early October. Output was restricted by stoppages in some areas, but still averaged 205,500 tons a day in September com pared with 201,800 tons in August, and was the largest since January 1940. The volume of hard coal mined during the first nine months was 7 per cent greater than a year ago. the month since 1928. The increase was due chiefly to a sharp expansion in contracts for com mercial structures to the highest level in eleven years and in awards for public works and utilities. Contracts for houses also increased substantially and were more than double a year ago. Aggregate awards in September exceeded the dollar volume of a year ago by 58 per cent, and during the first nine months were 54 per cent greater than in 1940, owing chiefly to increases Operations at bituminous coal mines in Penn in contracts let for family dwellings and com sylvania also expanded less than seasonally in mercial and industrial structures. September but reached the high level of 443,000 tons a day and were the largest for the month since Agriculture. The market for farm products in 1929. Production thus far this year has aggre this District has been unusually strong throughout gated nearly 89,000,000 tons, the largest for the the year. Farm cash income in Pennsylvania, period in eleven years. In late October opera New Jersey, and Delaware in the first eight months tions were again curtailed at several mines, owing totaled nearly $305,000,000, about 15 per cent to labor difficulties. more than a year ago. Shortages of farm labor were increasingly pronounced. Output of by-product coke in September was A severe drought in September and the first the highest on record. Operations at gas and fuel oil refineries also increased somewhat from August half of October retarded the growth of late crops and delayed fall plowing and seeding. Lack of to September. Page Three RETAIL TRADE FREIGHT CAR LOADINGS PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT ALLEGHENY DISTRICT PER CENT MERCHANDISE AND MISCELLANEOUS' SALES ADJUSTED TOR SEASONAL VARIATION 1936 1937 1938 1939 1940 1941 1942 moisture also restricted the growth of pastures, necessitating supplementary feeding of livestock. Department of Agriculture estimates as of October 1 indicated that the production of wheat, hay, and white potatoes would be somewhat below the 1936 40 average, while the harvest of oats and tobacco was expected to be substantially higher. Estimated yields of corn were revised upward to approxi mately the five-year average. Wholesale prices of farm products have weak ened recently, following substantial advances in September and earlier months. Quotations in the third week of October, however, were 35 per cent higher than a year ago and 47 per cent above the pre-war level of August 1939, according to the United States Bureau of Labor Statistics. Trade. Trade continues active, although recent gains have been smaller than usual for this time of year. Sales in September expanded somewhat further from the unusually large volume reached in August. Rail freight traffic was the largest in twelve years. Wholesale trade also increased from August to September and was substantially greater than a year ago. Sales at retail expanded and toward the close of September were stimulated considerably by large purchases of goods to avoid the increased taxes which went into effect on Oc tober 1; a temporary letdown followed, but sales continued larger than a year ago. Retail sales increased in most lines in Septem ber, following heavy anticipatory buying in August. The only actual decline was at credit stores special izing in durable consumers’ goods, sales of which were especially large in earlier months. On a sea sonally adjusted basis, the contraction in sales from August to September ranged from 10 per cent at Page Four 1936 1937 1938 1939 1940 1941 women’s apparel stores to 32 per cent at shoe and credit stores. Compared with a year ago sales in September by department and women’s apparel stores increased about 17 per cent; gains amounted to 4 per cent at credit establishments and 1 per cent at shoe stores. Total sales in reporting lines in the first nine months were about 18 per cent greater than a year ago. Inventories expanded seasonally in all lines and were much heavier than in September 1940. In creases in the year ranged from 15 per cent at shoe stores to 34 per cent at department stores and 38 per cent at credit stores. The dollar volume of outstanding orders placed by a group of department stores declined moderately in Sep tember but at the close of the month was still con siderably larger than a year ago. The distribution of goods at wholesale increased 14 per cent in the month and was about one-half again as large as in September 1940. The largest increases over last year were in paper, hardware, electrical supplies, and dry goods. Stocks of goods declined in September in most lines, but over the past twelve months have been increased 14 per cent, chiefly at establishments specializing in groceries, hardware, and electrical supplies. Loadings of rail freight in this section in Sep tember were the heaviest since 1929. The increase over August was somewhat less than usual, owing to the large volume of fuels and miscellaneous freight handled earlier. Total shipments were 18 per cent greater than a year ago; the largest in creases were 50 per cent in the case of forest products and more than 20 per cent in fuels; and the only decline was in the movement of livestock products. Shipments originating in the Philadel phia area are considerably above a year ago. MEMBER BANK RESERVES MILLIONS L0ANS AND INVESTMENTS OF ALL MEMBER BANKS PHILADELPHIA FEDERAL RESERVE DISTRICT PHILADELPHIA FEDERAL RESERVE DISTRICT 1500 LOANS TOTAL 1000 OTHER SECURITIES EXCESS US.GOVERNMENT OBLIGATIONS I (direct and guaranteed) 1 REQUIRED '32 33 '37 '38 *29 *30 31 32 33 34 ’35 ’36 *37 ’38 '39 40 h\ Banking conditions. The commercial demand tial support to reserve balances was a gain of for bank credit has slackened somewhat in this $22,000,000 in transactions with other Districts. District in the past month, following sharp in Preliminary tabulations as of September 24 creases earlier in the year which carried business covering all member banks in the District showed loans to a level one-third higher than a year ago. loans and investments at a level of $2,601,000,000, An expansion in the investment portfolio has raised the highest since the fall of 1931. Nearly onetotal earning assets to a new peak. Deposits re third of the expansion of $65,000,000 in the third main near the record high reached late in Septem quarter of the year was in loans, reflecting chiefly ber and are being used more actively than was the extension of additional credit to trade and the case last year. industry. The increase in investments was mainly The member banks in this District generally are in United States Government obligations, and to a carrying heavy balances with the Federal Reserve lesser extent in state and local government securi Bank and correspondent institutions as they ap ties. proach the first of November, when higher reserve In the four weeks ended October 22, the sharp requirements go into effect. Reserves totaling upward trend of commercial loans in response to $767,000,000 on October 22 were 14 per cent the increased working capital needs of business larger than a year ago and about double current was interrupted at the reporting banks by a de requirements. cline of $3,000,000 to $303,000,000. These A contraction of $36,000,000 in reserves in the loans still exceeded the level of a year ago by four weeks ended October 22 was due principally $73,000,000 and the volume at the outbreak of to operations of the Treasury. In this District, war by $117,000,000. cash subscriptions to the new 2% per cent Treas In spite of the repayments on commercial ac ury bonds of 1967-72 totaled $617,000,000, and count, total loans and investments of the reporting the allotment on a 12^ per cent basis was banks advanced $16,000,000 further in the four $77,000,000. These bonds were paid for partly weeks to $1,364,000,000. This was due princi by deposit credit, but chiefly by cash payments in pally to an expansion in holdings of United States excess of $50,000,000. The amount received in bonds, most of which were taken on in the last week the past four weeks on sales of savings, tax, and of the period, probably through allotments against depository securities was nearly as large, and subscriptions to the new issue. Treasury receipts were further increased by the withdrawal of $32,000,000 from depository banks. Deposits declined $9,000,000 from the all-time Receipts from all sources exceeded Treasury dis record on September 24 to $2,037,000,000 on bursements in the District by $52,000,000, al October 22, owing to shrinkage in interbank and though defense expenditures continued very heavy. state and local government balances. Demand de Reserves were further reduced by a moderate in posits of individuals and business concerns ex crease in currency demand. The only substan panded to a new peak. Page Five BUSINESS STATISTICS Production Employment and Income Philadelphia Federal Reserve District in Pennsylvania Adjusted for seasonal variation Not adjusted Industry, Trade and Service Per cent change Indexes: 1923-5=100 Sept. Aug. Sept. 1941 1941 1940 INDUSTRIAL PRODUCTION MANUFACTURING................. Durable goods........................... Consumers’ goods................... Metal products.......................... Textile products......................... Transportation equipment. . . Food products............................ Tobacco and products............. Building materials.................... Chemicals and products......... Leather and products.............. Paper and printing.................... Individual lines Pig iron........................................ Steel.. . ......................................... Iron castings............................... Steel castings............................. Electrical apparatus................. Motor vehicles........................... Automobile parts and bodies Locomotives and cars.............. Shipbuilding............................... Silk manufactures..................... Woolens and worsteds............. Cotton products........................ Carpets and rugs....................... Hosiery........................................ Underwear................................... Cement........................................ Brick............................................. Lumber and products.............. Bread and bakery products .. Slaughtering, meat packing .. Sugar refining............................. Canning and preserving.......... Cigars........................................... Paper and wood pulp............... Printing and publishing.......... Shoes............................................ Leather, goat and kid.............. Explosives................................... Paints and varnishes................ Petroleum products.................. Coke, by-product...................... COAL MINING.......................... Anthracite................................... Bituminous................................. CRUDE OIL................................. ELEC. POWER—OUTPUT. . Sales, total................................... Sales to industries..................... BUILDING CONTRACTS TOTAL AWARDSf.................... Residential f............................... Nonresidentialf......................... Public works and utilities!. . . Sept. 1941 1941 9 Mo. Year mos. 1940 ago ago 119 117 145 96 141r 90 255 r 89 111 52 r 151 122 92 92 r 90 101 82 104 70 138 81 102 44 r 140 106r 86 - 2 0 + 5 - 6 + 3 -12 + 7 - 2 0 + 2 + 1 - 3 +1 + + + + + + + + + + + + + 113 118 130 122 102 102 206 189 180 182r 53 62 124 125r 80 74 r 1518 1358 72 89 75 76 56 61 108 113 88 106 160 173 72 74 71 69 r 32 32 90 104 72 135 109 24 98 39 675 73 53 45 89 88 129 65 50 29 r 101 . . . .} 96 111 88 r 93 146 99 178 101 172 152 102 103 98 419 349 350 252 103 68 68 101 79 88 131 82 r 138 89 170 148 /Or 68 r 85 407 289 289 207 + 26 + 25 + 42 + 53 + 65 +119 + 27 + 109 + 125 - 2 + 41 + 25 + 21 0 + 24 + 15 + 42 + 10 + 8* - 7 + 23 + 34 + 33 + 71 + 67 +132 + 51 95 . . . .t 93p 110 90 93 140 97p 172 104 173p 161p 81 80p 91 431 344 345 249 - 4 + 6 + 1 + 9 ~ 1 -14 - 1 + 9 + 12 -20 - 2 - 8 - 4 -17 - 8 + 4 + 2 0 4- 2* - 5 - 3 0 + 2 0 - 4 - 2 - 3 + 3 0 + s -21 -22 - 7 + 3 - 1 - 1 - 1 + + + + + + + + + + + + + + + + + 37 9 14 6 7 18 25 16 1 « 16 18 7 6 19 19 21 + + + + + + + + + + + + + + + + 153 96 196 178 155 91 224 183 94 53 111 157 + - + + + + 62 80 77 13 + 53 + 46 +iii - 10 116p 116p 152p 90p 145 79p 274 87p 111 54 152p 118p 93 1 6 12 3 27 + 25 29+28 51 + 50 9 + 12 39 + 46 13 + 18 99 + 89 7 + 7 9 + 5 21 + 31 8 + 12 11 + 1« 7 + 3 +102 + 19 + 39 + 26 + ii + 7 + 13 + 27 + 54 + 13 + 6* - 5 * Unadjusted for seasonal variation. t 3-month moving daily average centered at 3rd month. t No figures due to strike. 23 5 6 2 20 11 52 15 2 11 9 7 9 5 16 17 25 Employment Sept. Aug. Sept. 1941 1941 1940 117p 117 118p 117 146 80p 259 96p 129 58 151p 130p 92 93 92 147 85 248 r 91 119 59 r 152 125 90 104 71 130 87 118 48r 139 117 86 106 104 84 123 124 99 103 73 99 188 181 122 198 203 r 120 46 52 21 118 118r 93 77 75r 37 1442 1345 641 72 87 r 73 81 78 58 53 42 55 116 104 r 96 88 92 88 160 161 129 87 76 90 72 72 r 51 33 34 30r 100 98 93 96 103 86 % x 59 126p 108 89 128 119 117 90 88 r 79 92 90 87 160 156 149 101p 95 86 r 172 178 138 99 103 85 175p 174 173 154p 149 142 79 78 67 77p 76 65 r 93 92 87 431 419 407 337 331 283 342 332 287 264 260 219 148 113 185 162 150 102 206 159 Percentage change— September 1941 from month and year ago Allentown.... Altoona............ Harrisburg... . Johnstown.... Lancaster......... Philadelphia . . Reading........... Scranton.......... Trenton........... Wilkes-Barre. . Williamsport. . Wilmington.. . York.................. Employment Payrolls Building permits value Aug. 1941 Sept. 1940 Aug. 1941 Sept. 1940 Aug. 1941 Sept. 1940 Aug. 1941 Sept. 1940 -2 0 +i +i 0 +2 -1 -4 +2 -3 +1 0 +4 +15 +26 +27 +26 +15 +25 +12 +15 +10 +27 +19 +34 +14 -3 -3 0 +i 0 +4 -1 -4 +4 +1 +1 0 +6 +39 +37 +46 +46 +34 +52 +33 +26 +32 +73 +43 +63 +36 + 4 + 101 + 20 + 110 5 - 11 + 25 +1352 - 32 + 60 + 509 + 40 + 24 + 86 + 148 + 73 + 53 + 381 8 - 50 +1054 - 69 + 125 - 37 - 23 + 77 - 5 - 4 + 7 - 8 +13 +25 - 1 + 3 + 7 + 8 +17 + 11 + 12 +21 +32 +16 +17 + 3 +14 +18 - 3 +12 +11 +17 - 5 - 2 - 1 - 2 + 7 - 7 - 5 + 9 -21 + 3 - 9 +17 - 1 +33 +21 +16 +33 +31 +35 +25 +30 +26 +25 +34 +30 +37 +i +16 0 +21 0 0 +i 0 -3 +16 +i +10 -1 + 3 0 + 4 +7 +10 +1 + 7 +3 + 4 -3 +14 -1 + 4 239 323 86 314 128 339 180 125 148 145 130 165 150 Employment* +38 +43 +28 +43 +42 +44 + 10 +10 +17 +12 +10 +23 + 9 0 0 -3 -2 +i +4 +3 0 +6 +1 +4 +4 +5 Payrolls* Per cent Per cent Sept. change from Sept. change from 1941 1941 index Aug. Sept. index Aug. Sept. 1941 1940 1941 1940 Indexes: 1923-5=100 TOTAL..................................... Iron, steel and products.... Nonferrous metal products. Transportation equipment. Textiles and clothing.......... T extiles................................. Clothing................................ Food products....................... Stone, clay and glass........... Lumber products.................. Chemicals and products. . . Leather and products......... Paper and printing.............. Printing................................. Others: Cigars and tobacco............ Rubber tires, goods........... Musical instruments......... 111 116 179 94 96 88 130 119 99 68 114 98 105 93 70 97 77 0 +21 0 +31 0 +41 +3 +45 -4 + 7 -5 0 +in +8 + 7 0 +20 -1 + 5 +1 + 17 +1 + 12 +1 + 7 +1 + 6 132 183 261 118 103 94 146 133 115 77 145 112 124 108 0 -1 -1 +2 -3 -3 -1 +6 0 0 +1 +2 +6 +7 +43 +57 +57 +64 +22 +20 +30 + 13 +31 +20 +29 +33 + 18 +10 +1 -1 +1 68 129 86 +2 +3 -9 + 9 +36 + 11 + 7 +18 +11 * Figures from 2,814 plants. Hours and Wages Debits Sept. 1940 135 172 66 107 69 129 142 105 119 128 107 120 109 Manufacturing Factory Workers Averages September 1941 and per cent change from year ago Retail sales * Area not restricted to the corporate limits of cities given here. Page Six GENERAL INDEX............ Manufacturing...................... Anthracite mining............... Bituminous coal mining. . . Building and construction.. Quar. and nonmet. mining. Crude petroleum prod......... Public utilities....................... Retail trade............................ Wholesale trade.................... Hotels...................................... Laundries............................... Dyeing and cleaning........... p—Preliminary, r—Revised. Aug. 1941 Indexes: 1932=100 91 62 104 143 Local Business Conditions* Payrolls Per cent Per cent Sept. change from Sept. change from 1941 1941 index Aug. Sept. index Aug. Sept. 1941 1940 1941 1940 TOTAL............................. Iron, steel and prod... . Nonfer. metal prod.. . . Transportation equip.. 1 extiles and clothing. . Textiles........................ Clothing....................... Food products.............. Stone, clay and glass.. Lumber products......... Chemicals and prod.. . Leather and products . Paper and printing. . . Printing........................ Others: Cigars and tobacco. . Rubber tires, goods.. Musical instruments . Weekly working time* Hourly earnings* Weekly earnings t Aver Aver Ch'ge Aver Ch’ge age Ch’ge hours age age 40.4 41.4 41.3 43.1 37.0 37.3 36.3 39.8 37.2 41 .6 39.2 38.4 41.1 37.8 + 5 $.820 +13 $33.16 + 5 .919 + 14 38.02 + 3 .718 + 6 29.63 + 7 .920 + 13 39.65 + 7 .584 +10 21.47 .599 +12 22.25 + 6 +11 .542 + 7 19.74 0 .636 + 6 25.57 + 1 .781 + 7 29.02 + fi .590 - 1 24.31 + 2 .885 + 9 34.31 + 6 .592 + 8 22.73 .749 + 5 32.01 + 7 + 6 .915 - 1 36.91 +19 +20 +10 +21 +17 +17 +17 + 5 + 9 + 6 +n +15 + 9 + 2 37.6 39.1 41.6 - 2 + 6 - 6 + 1 + 10 - 2 * Figures from 2,616 plants. .469 .754 .703 + 5 + 4 + 4 17.66 29.43 29.25 t Figures from 2,814 plants. Distribution and Prices Adjusted for seasonal variation Per cent change Wholesale trade Unadjusted for seasonal variation Sept. 1941 from Month Year ago ago Sales Total of all lines................... + 14 + 19 Dry goods............................. + 8 Electrical supplies.............. - 8 Groceries............................... + 13 Hardware.............................. + 17 Jewelry.................................. +107 Paper..................................... + 14 Inventories + 1 + 3 _ 7 + 10 - 3 - 12 - 8 +46 +17 +57 +62 +30 +63 +29 +73 Indexes: 1935-1939=100 Sept. Aug. Sept. 1941 1941 1940 +38 Basic commodities (Aug. 1939=100). . Wholesale (1926 = 100).......................... Farm.......................... Food........................... Other......................... Living costs (19351939=100) United States......... Philadelphia........... Food........................ Clothing................. Rent......................... Fuels........................ Housefurnishings . Other....................... Per cent change from Sept. 1941 Month Year Aug. 1939 ago ago +3 +42 +56 +2 +4 +3 +1 +18 +37 +25 +22 +49 +33 +14 108 107 107 110 105 103 112 105 +2 +2 +3 +4 0 0 +3 +1 + 8 + 8 +15 + 9 + 2 + 5 + 9 + 4 +n + 19 +19 +13 +15 +19 +18 153 147 149 144 160 177 116 114 117 114 108 116 -12 - 9 -10 -15 -32 -32 +17 +17 + 16 + 8 + 1 + 4 130p 120 131 HOp 154p 128 122 135 103 144 97 91 102 96 112 + + + 1 2 3 7 7 +34 +32 +28 +15 +38 FREIGHT-CAR LOADINGS Total........................................................................ Merchandise and miscellaneous..................... Merchandise—l.c.l.............................................. Coal........................................................................ Ore.......................................................................... Coke....................................................................... Forest products................................................... Grain and products........................................... Livestock.............................................................. 138 133 107 145 167 194 159 115 94 144 139 109 158 158 202 141 93 91 117 113 97 118 158 161 106 101 104 - 4 - 4 - 2 - 9 + 6 - 4 +13 +23 + 3 +18 +18 +10 +22 + 6 +21 +51 + 13 -10 +23 +25 +13 +18 +33 +35 +49 + 7 - 5 MISCELLANEOUS Life insurance sales.............................................. 128 114 112 +12 -57* Inventories 92 91 89 92 Month Year ago ago 1941 from 9 mos. 1940 135p 133 135 123p 109p 121p Department stores—District.......................... Philadelphia................. Women’s apparel................................................ Men’s apparel..................................................... Shoe........................................................................ Credit..................................................................... +14 + 2 +23 +33 +16 -12 + 5 156 Sept. 1941 from Sept. Aug. Sept 1941 1941 1940 RETAIL TRADE +39 +75 +21 +56 +46 +30 Source: U. S. Department of Commerce. Prices Not adjusted Per cent cheinge 1941 from 9 mos. 1940 +10 + 9 +16 +11 + 3 + 7 +11 + 4 114 107 110 109 96 149 116 115 121 102 123 121 139p 130 151 119p 168p 119 113 127 105 140 103 98 118 104 122 155 151 112 150 267 186 170 117 111 151 144 107 152 275 178 148 110 95 132 128 102 123 253 154 113 103 124 +14 -28* + 7 103 +23* 45 96 105 90 63 + 8* +19* + 2* +1* + 7* + 7* 113p 106 llOp 93 110 109 -21* -73* -13 -28* -45* +27 -11* + 5* +27 81 27 131 112 50 103 Hotels—(1934 = 100) Business liquidations Check payments................................................... 138 * Computed from unadjusted data. Source: U. S. Bureau of Labor Statistics. 135p 134 139 1 lip 125p 126p 159 ios p—Preliminary. 101 103 135 r—Revised. BANKING STATISTICS MEMBER BANK RESERVES AND RELATED FACTORS Changes in— i i+ + Assets Commercial loans................. $ 303 Open market paper............. 44 Loans to brokers, etc........... 28 Other loans to carry secur.. 31 51 Loans on real estate............ Loans to banks...................... Other loans............................. 113 Four weeks i 22, 1941 HHHHW Reporting member banks (000,000’s omitted) + 2 One year Philadelphia Federal Reserve District (Millions of dollars) Oct. 1 Changes in weeks ended— Oct. 8 Oct. 15 Oct. 22 Changes in four weeks +$ 73* + 7 + 5 1 + 1 1 + 8* Sources of funds: Reserve Bank credit extended in district............................ Commercial transfers (chiefly interdistrict)....................... Treasury operations................................................................... - 0.2 + 1.8 -17.0 + 0.8 + 5.1 + 9.9 + 2.1 + 9.8 - 1.6 - 2.0 + 5.2 -43.4 + 0.7 +21.9 -52.1 Total............................................................................................. -15.4 +15.8 +10.3 -40.2 -29.5 Uses of funds: Currency demand....................................................................... Member bank reserve deposits.............................................. “Other deposits’’ at Reserve Bank...................................... Other Federal Reserve accounts............................................ + 1.9 -17.7 + 0.5 - 0.1 + 2.2 +14.7 - 1.1 - 0.0 + + + 3.6 0.9 7.5 0.1 + 0.6 -32.6 - 8.2 + 0.0 + 8.3 -36.5 - 1.3 + 0.0 -15.4 +15.8 + 10.3 -40.2 -29.5 $ 570 -$ 1 +$ 92 Government securities........ $ 430 Obligations fully guar’teed. 96 Other securities..................... 268 +$16 +$ 66 + 3 3 Total............................................................................................. 1 +$17 +$ 66 Member bank reserves (Daily averages: dollar figures in millions) Total loans Total investments $ 794 i <<N + + i i Liabilities Demand deposits, adjusted $1267 Time deposits........................ 256 U. S. Government deposits. 21 Interbank deposits............... 493 Borrowings............................. Other liabilities...................... 15 Capital account.................... 218 <DNHNH Total loans & investments $1364 Reserve with F. R. Bank.. . 574 Cash in vault......................... 27 Balances with other banks. 229 Other assets—net................. 76 + +$158 + 81 + 5 2 4 -$ + - 1 1 2 9 +$234 5 - 26 + 31 + 5 1 + + i 3 Held Re quired Ex cess Ratio of excess to re quired Phil a. banks: 1941: Sept. 1-15.. $578.3 $264.1 $314.2 119% Sept. 16-30.. 577.1 264.6 312.5 118 ” Oct. 1-15.. 576.1 1940: Oct. 1-15.. 475.4 223.8 251.6 112 » Country banks: 1941: Sept. 1-15.. 219.7 113.3 106.4 Sept. 16-30.. 217.C 113.2 103.8 Oct. 1-15.. 221.8 1940: Oct. 1-15.. 199.1 100.6 98.5 94 * 92 * 98” Federal Reserve Bank of Phila. (Dollar figures in millions) Oct, 22, 1941 Four weeks Changes in— One year Bills discounted........ Bills bought............... Industrial advances. U. S. securities......... $0.1 0 3.6 172.0 - $0.1 0 - 0.1 + 0.2 - $0.3 0 + 1.2 - 25.6 Total.......................... Note circulation.... Member bk. deposits U. S. general account Foreign bk. deposits. Other deposits........... Total reserves........... Reserve ratio............. $175.6 509.5 767.5 65.0 109.4 13.0 1311.6 89.6% + + + + -$24.7 +130.6 + 95.0 + 51.1 + 35.7 - 12.3 +324.8 + 4.8% $0.0 8.5 36.5 32.8 3.6 1.3 6.1 0 * Revised. Page Seven National Summary of Business Conditions INDUSTRIAL Industrial activity continued at a high rate in September and the first half of October, r urther advances in the output of defense products were accompanied by curtailment in some lines of civilian goods, particularly automobiles, rubber, and silk. Prices oi industrial products increased further but agricultural prices declined after the middle of September, and on October 16 dropped sharply in response to inter national developments. PRODUCTION Production Federal Reserve index of physical volume of production, adjusted for seasonal variation, 1935-39 average =100. By months, January 1935 to September 1941. DEPARTMENT STORE SALES AND STOCKS Federal Reserve indexes of value of sales and stocks, adjusted for seasonal variation, 1923-25 average =100. By months, January 1935 to September 1941. WHOLESALE PRICES OF BASIC COMMODITIES Industrial output increased by about the usual seasonal amount in September and the Boards adjusted index remained at 160 per cent of the 1935-1939 average, the same as m July and August. Continued increases in activity were reported in the machineiy, aircraft, and shipbuilding industries. At steel mills activity in September 3 j j i- . half 0ct°ber was maintained at about 97 per cent of capacity. Output and deliveries of nonferrous metals likewise remained at about capacity levels, while lumber production declined somewhat from the high August rate. Automobile pro duction increased less than seasonally in September, following the changeover to new models, and, according to preliminary estimates, output in September was considerably below the maximum quota that had been authorized by the Government. In the textile industry activity declined somewhat in September, reflecting mainly a further sharp reduction at silk mills. Activity at wool mills rose to a new high level, whiie at cotton mills there was little change from a rate slightly below the peak reached last May. Shoe production continued in large volume, and output of manufactured iood products was maintained near the peak August level. Output of chemicals like wise continued at earlier high rates, but at rubber plants activity was considerably below the level of last summer owing to curtailment programs ordered by the Govern ment. Coal production, which during the summer months had been unusually large, increased less than seasonally in September, owing in part to temporary work stop pages at some bituminous and anthracite mines. Crude petroleum production advanced to record levels in September and the first half of October, and output of metals and shipments of iron ore down the Lakes continued at about capacity. Value construction contract awards declined in September, according to figures of the F. W. Dodge Corporation, reflecting chiefly decreases in awards for public projects which had been exceptionally large in August. Awards for private residential building also declined, while contracts for other private work increased somewhat further. Total awards in September, as in August, were 80 per cent larger than in the corresponding period last year. This higher level reflected mainly a greater amount of public construction, which was nearly three times as large as a year ago, compared with an increase of about 10 per cent for private construction. On October 9, the Supply Priorities and Allocations Board announced that effective immediately, no public or private construction projects which use critical’ materials could be started during the emergency unless these projects were either necessary for direct national defense or essential to the health and safety of the nation. _ Bureau of Labor Statistics' indexes based on 12 foodstuffs and 16 industrial materials, August 1939 =100. Thursday figures, January 3, 1935 to October 9, 1941. MEMBER BANKS IN I0I LEADING CITIES ■iUMM or 0OU.1M U. S. GOVT OBLIGATIONS Distribution Distribution of general merchandise showed less than the customary seasonal rise in September, following an unusually large volume of sales in August. During the past three months sales have been larger than in the corresponding period of any previous year. In the first half of October sales at department stores declined from the peak reached in late September when there were considerable consumer purchases, partic ularly of articles subject to higher taxes on October 1. Loadings of revenue freight in September increased less than seasonally particularly those of miscellaneous freight, which have been high in recent months, and loadings of coal, which were curtailed during part of the month by work stoppages at some mines. Shipments of forest products declined considerably from the hisih August level. 6 _ _ Commodity Prices r nPrileS of i“d“st.rial products continued to advance in September and the first half ot October and Federal price ceilings were announced for additional commodities, including leading types of lumber, coke, wastepaper, paperboard, acetic acid, alco hols, and carded cotton yarns. In some cases these ceilings were below previously existing market quotations. Price advances were permitted, however, for some other commodities under Federal control. Prices of cotton and of foodstuffs increased further in the first half of September, but subsequently declined, owing partly to sharply lnfluenCe8' 0n Thursday> October 16, prices of these commodities dropped Bank Credit loans at member banks continued to rise during September and the rst hall of October, reflecting in part defense demands. Increases were substantial both in New York and in other leading cities. Holdings of United States Government obligations decreased, mainly at banks in leading cities outside of New York. Excess reserves of member banks showed little change in this period. COMMERCIAL LOANS OTHER SECURITIES LOANS TO BROKERS ANO DEALERS I935 1936 1937 1938 1939 1940 United States Government Security Market 1941 Wednesday figures, January 2, 1935 to October 8, 1941. Commercial loans, which include in dustrial and agricultural loans, represent prior to May 19, 1937 so-called “Other loans” as then reported. Page Eight Following a slight decline in the first half of September, prices of long-term treasury partially tax-exempt bonds increased during the latter half of September and in the first part of October. The yield on the 2-% per cent bonds of 1960-65 reached a new record low of 2.01 per cent in October. Prices of taxable bonds moved lTw levels * ”arr0W range dUring thC Peri°d WUh yie!<3s sliglltly above Previous
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