The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
THE BUSINESS REVIEW THIRD FEDERAL PHILADELPHIA RESERVE DISTRICT NOVEMBER 2., i93i By RICHARD L. AUSTIN, Chairman and Federal Reserve Agent FEDERAL RESERVE BANK of PHILADELPHIA Business and Financial Conditions in the United States Industrial production and factory employment, which usually increase at this season, showed little change from August to September, and, conse quently, the Board’s seasonally ad justed indexes declined. The general level of wholesale prices also declined. Gold exports and earmarkings, to gether with an increase in domestic currency demand between the middle of September and the middle of Octo ber resulted in a large growth of re serve bank credit in use and a rise in money rates. Production and employment. Indus trial production, as measured by the Board’s seasonally adjusted index, de clined from 79 per cent of the 1923 1925 average in August to 76 per cent in September. Activity at steel mills decreased from 31 per cent of capacity to 28 per cent; output of automobiles was reduced substantially and lumber production continued to decline. At cotton mills production increased seasonally, while activity at woolen INDUSTRIAL PRODUCTION mills and shoe factories declined con trary to the usual seasonal tendency. Output of petroleum was smaller in September than in August, but the rate of output prevailing at the end of Sep tember was higher than at the end of August. The number employed at factories showed little change from the middle of August to the middle of September, a period when employment usually in creases. In iron and steel mills, auto mobile factories and lumber mills, em ployment decreased further, contrary to the seasonal tendency; in the cloth ing and silk industries there were substantial increases in employment, partly of a seasonal character; in mills producing cotton goods, employment increased less than usual, and in woolen mills it declined from recent relatively high levels. Data on value of building contracts awarded for the period between the first of August and the middle of Octo ber, as reported by the F. W. Dodge MONEY RATES IN NEW YORK A Jr-- - - - V_ _ PER C Corporation, show a continuation of the downward movement of recent months for residential as well as for other types of construction. Estimates by the Department of Ag riculture, based on October 1 condi tions, indicated a cotton crop of 16, 284,000 bales, the largest crop re ported, except that of 1926, a total wheat crop somewhat larger than usual, and a corn crop of 2,700,000,000 bushels, 29 per cent larger than last WHOLESALE PRICES Index of United States Bureau of Labor Statis tics (1926=100). RESERVE BANK CREDIT*-"FACTORS'-CHANGES K\ l ' V A — Commerctat Paper Rate — Acceptance Rate Index number of industrial production, ad justed for seasonal variation. (1923-1925 aver age = 100.) j Monthly rales in the open market in New York: commercial paper rate on 4 to 6 month paper. Acceptance rate on 90-day bankers* acceptances. Latest figures are averages of first seventeen days ip October, Monthly averages of daily figures. Latest fig ures are averages of first seventeen days in October. Page One year, and 2 per cent smaller than the five-year average. Distribution. Freight car loadings of merchandise and sales by depart ment stores increased in September, but by less than the usual seasonal amount. Wholesale prices. The general level of wholesale prices declined from 70.2 per cent of the 1926 average in August tO' 69.1 per cent in September, accord ing to the Bureau of Labor Statistics. Decreases in the prices of livestock, meats, hides, woolen goods, cotton and cotton goods were offset in part by in creases in prices of dairy products, petroleum and petroleum products. Further declines in the price of cotton during the first few days of October were followed by substantial increases in subsequent days. During the four weeks following the suspension of gold pay ments in England on September 20, gold was withdrawn from this coun try’s monetary stock in the form of exports and earmarkings. Domestic demand for currency continued to in crease, the growth for the month end ing in the middle of October being about $400,000,000. The growth in the amount of currency outstanding, how ever, slowed down after the first few days in October. The demands for credit arising from gold movements and currency growth were met by member banks through the sale of ac ceptances to the reserve banks and by rediscounts. Volume of reserve bank credit outstanding consequently in creased between the week ending Sep tember 19 and the week ending Octo ber 17 by $904,000,000 and on October Bank credit. 17 stood at $2,169,000,000, the highest level for ten years. Gold and currency withdrawals re sulted in a decrease of deposits at member banks in leading cities. Loans and investments of these banks also de clined, reflecting reductions in loans to security brokers, as well as sales of ac ceptances to the reserve banks, and sales of United States securities. During this period there was a rise in short time money rates in the open market and in yields on high grade bonds. On October 9 the Federal Re serve Bank of New York advanced its discount rate from \y2 to 2per cent and on October 16 to 3 per cent. Dis count rates were also advanced at the Boston, Philadelphia, Cleveland, Rich mond, Chicago, St. Louis, Dallas and San Francisco reserve banks. Business and Financial Conditions in the Philadelphia Federal Reserve District The trend of business has shown considerable variation since early Sep tember. Sales at retail and whole sale have increased seasonally, while the rate of manufacturing activity has declined instead of moving upward as usual at this time. The output of fuel and power reflects customary gains. Awards for building construction reg istered rather exceptional increases but permits decreased sharply. Com modity prices have displayed weakness since August, after moving along at a fairly steady level for about three months. In comparison with recent years, the general level of activity continues much lower. There was a strong demand for cur rency over part of the past month, and the banks also had to make substantial payments on United States securities allotted to them in September. Invest ments were reduced and there was a further sharp increase in borrowings from the Federal Reserve Bank. Member bank loans to customers de clined. The market for fin ished products varies from fair to poor, although there have been sea sonal gains in the demand for some manufactures. Prices of commodities, comprising manufactures chiefly, de clined fractionally from August to September; recessions in raw mate Manufacturing. Page Two rials and semi-manufactured products were more pronounced than in prices of finished goods. Unfilled orders for manufactures de creased since the middle of last month, although seasonal advances were re ported by some of the textile branches. In comparison with a year ago, for ward business continued substantially smaller. Inventories held at manu facturing establishments have been re duced further and appear to be appreciably smaller than a year earlier. Factory employment in this section declined fractionally instead of in creasing seasonally. Wage payments also declined by less than 5 per cent, reflecting partly the inclusion of Labor Day in the payroll period, covered by many concerns. Compared with a year ago, the index of factory employment in this district was 17 per cent lower and the payroll index 33 per cent lower. The demand for workers by employers in Pennsylvania continued downward and in September was the lowest since the depression period of a decade ago. Production increased less than was to be expected, so that our adjusted index was nearly 2 per cent lower than in August; the decline in the country’s index amounted to almost 4 per cent. The decrease here in the seasonally adjusted index was due principally to the metal, food, tobacco, chemical, and leather industries. More than seasonal gains in the out put of textile products reflect chiefly increased activity of silk, hosiery, and to some extent carpet and rug mills. Gains in wool takings and in the output of knit underwear were not up to the usual average. Textile prices have de clined a little further, although re cently cotton manufactures showed some strength. Most of the industries included in the metal and transportation equipment groups showed further curtailment of activity, thus continuing to depress the general index of manufacturing activ ity. Lately, however, some gain has been reported in the output of steel works and rolling mills and of auto mobile bodies and parts. Prices of iron and steel products have continued steady, while non-ferrous metals de clined. Quotations for automobiles advanced slightly over the August level. The hide and leather market is rela tively dull and prices have declined rather sharply during the month. Pro duction of shoes, particularly of the less expensive kind, was 2 per cent larger in September than August, a gain which was much smaller than usual; in the country output of shoes in the same period decreased by 5 per CHECK PAYMENTS PERCENT 200 and 1 - PRICES OUTPUT or BOOTS 1923-25 AVG.—100 and SHOES ■ERCENT PHILADELPHIA PHILA. FED. RES. DIST. FEDERAL RESERVE DISTRICT UNITED STATES i I TT (new yc RK CITY EXCLUDEC ) l ' \ \ ! .i 100 ___ t .................................>. 90 Xm. V 80 WHOLES/O.E PRICES 70 UNITED STATES 60 CHECK PAYMENTS ADJUSTED 50 ...... FOR SEASONAL VARIATIONS ........................... ... 1 *..................................... " 1928 1929 1930 19 23—25 AVG 1931 1932 1928 1929 1930 Source: Department of Commerce, Bureau of the Census cent. Shoe prices show further reduc tions. Among the industries preparing foods, the output of bread and bakery products and the slaughterings of calves showed more than customary increases, while sugar refining and the slaughterings of hogs, cattle, and sheep declined somewhat more sharply than was to be expected. Canning and pre serving continued fairly steady, though at a lower level than in the past two years. Wholesale food prices declined but slightly in the month and were 18 per cent lower than in September 1930. A further rather exceptional gam occurred in the printing and publishing industry, while operations of paper and wood pulp establishments showed a drastic decline. In the chemical group, chemicals, drugs, and paints and var nishes reported improvement, while the output of petroleum products, by-prod uct coke, and explosives was reduced somewhat. The improvement in the cigar industry was much less than sea sonal, while output of manufactured tobacco and snuff was greater than usual. Production of Portland cement de creased by a considerably smaller amount than is customary, so that the seasonally adjusted index showed a further gain. Stocks, while declining in the month, were larger than at the end of September last year. Other building materials such as brick, lum ber, plumbing, pottery and slate re ported curtailments of operations. The output and sales of electrical energy increased seasonally, owing mainly to a larger consumption of September, 1931 I Business indicators Philadelphia Federal Reserve District Amount Percentage change since Aug., 1931 Sept., 1930 Retail trade*—estimated net sales (161) stores. Department (68)................................................... Men’s apparel (24)................................................ Women’s apparel (15)........................................ Shoe (36).................................................................. Credit (18)............................................................... $681,700 $590,500 $16,900 $51,300 $8,500 $14,500 +29.1 +29.8 - 1.2 +45.3 +14.9 + 8.2 -14.7 -14.8 -13.8 -14.1 -20.4 -11.3 Wholesale trade*—net sales (99 firms). Boots and shoes (5)................................. Drugs (10).................................................. Dry goods (12).......................................... Electrical supplies (7)............................. Groceries (28)............................................ Hardware (20)....................... ................... Jewelry (10)............................................... Paper (7).................................................... $249,132 $3,824 $54,709 *11,967 *11,168 $98,932 $45,633 $9,632 $13,207 +16.3 + 8.9 + 9.6 +40.2 - 1.1 +2-1.2 + 18.3 +31.5 - 1.0 -16.7 -27.7 - 7.2 -19.7 -36.9 - 6.6 -19.8 -43.9 -22.6 253,785 $4,940,863 48,568 58,622 14,496 295,235 413,180 2,478 100 77 174,100 301,200 24,800 92,033 17,530,100 - 0.3 - 4.4 + 1.7 +25.4 + 7.3 + 6.2 -13.0 -19.5 + 4.9 - 2.5 + 4.9 + 4.8 -16.8 - 1.3 + 3.9 -16.9 -34.0 -23.9 -56.7 -41.2 -40.0 -16.3 -25.4 -48.2 -15.6 + 1.5 +10.1 -12.9 - 6.1 +70.4 +22.8 -88.1 + 4.6 -51.1 - 2.1 +93.3 -23.7 -92.0 + 17.7 +38.9 -23.8 +81 .2 -18.5 +22.0 -51.2 -65.2 -28.3 +28.0 -35.4 -10.0 - 0.6 - 9.0 -15.9 -22.7 - 8.1 -18.8 Productive activity*— Employment—829 plants in Penna..................................................... Wage payments (weekly average)..................................... ”"*”**., Shoe production!—75 factories............................................................ prs Hosiery production!—135 mills................................................. doz. prs Underwear production!—52 mills............................................. doz. pcs Wool consumption!—60 mills............................................................... lbs Active cotton spindle hours.................................... ....................... Pig iron production................................................................. tons Iron casting production—31 foundries......................................... ’ .tons Steel casting production—9 foundries........................................’ ’ ' tons Anthracite.................................................................................................. tons Bituminous coal—Penna...................................................... tons Petroleum receipts at Port of Philadelphia........................... bbls Cement...................................................................................................... bbls. Electric power output—10 systems.................................................KWH Financial and credit— Debits (check payments)*—17 cities......................................................... $81,576,400 Loans and investments—Oct. 21—reporting member banks in four cities..................................................................................... $1,266,000,000 Bills discounted held by F. R. B. of Phila. (daily average) $31,700,000 Bankers’ acceptances outstanding—end of month.................................. $17,667,000 Commercial paper sales*—4 dealers................................................. $25,870 Commercial failures—number........................................! 113 Commercial failures—liabilities................................................ $2,694,239 Building and real estate— Building permits*—17 cities............................................................. $128,166 Building contracts awarded*.......................................................... $624,000 Number of real estate deeds recorded* (Philadelphia county). 137 Value of mortgages recorded* (Philadelphia county)................ $316,414 Sheriff sales writs issued for October—(Philadelphia county). . 888 Miscellaneous*— Freight car loadings (Allegheny district)...................................... 24,656 Sales of life insurance (Penna., N. J., and Del.).......................... $3,050,500 Automobile sales registrations of new passenger cars............... 406 * Daily average of monthly figures. ! Bureau of the Census preliminary figures. Page Three CARPET LOOM ACTIVITY CONTRACTS AWARDED-CUMULATIVE PHILA. FED. PERCENT RES. DIST. residential 1923-25AVG.= IOO UNITED STATES MIDDLE ATLANTIC STATES 1928 1929 1930 1930 electricity for lighting purposes. The increase in the use of power by in dustries failed to measure up to the typical average for September. Sept., 1931, per cent change from Sept., 1930 Aug., 1931 Rated generator capacity.......... + 1.9 + 0.5 Generated output........................ Hydro-electric.......................... Steam.......................................... Purchased.................................. + 1.5 +26.5 - 5.7 +23.7 + 3.9 -31.5 + 10.4 + 0.6 Sales of electricity........................ Lighting..................................... Municipal.............................. Residential and commcrcial....................................... Power.......................................... Municipal.............................. Street cars and railroads . . Industries*............................ All other sales........................... + 2.6 +13.6 + 3.4 + 4.3 +12.4 + 12.4 +15.0 - 1.8 +10.3 - 8.2 - 1.0 +19.6 +12.4 + 2.2 - 6.8 + 4.5 + 2.2 + 4.8 * Working days average—other items are com puted on calendar days. Activity in the construction and contracting indus try declined in September by about the usual seasonal amount; in comparison with a year ago, however, operations were at substantially lower levels. In the Philadelphia area, which was the only section of the state to show im provement, there was a gain of 4 per cent in the number of workers em ployed and of 13 per cent in the vol ume of weekly payrolls. General contracting work increased further last month, but activity in other classes of construction was sharply reduced. The proposed expenditure under per mits issued in seventeen cities of this Building and real estate. Page Four J FMAMJ JASOND J FMAMJ JASOND Source: F. W. Dodge Corporation Source: Department of Commerce Electric power Philadelphia Federal Reserve District 11 Systems 1932 The number of deeds recorded in Philadelphia declined in September but the value of mortgages was some what larger than the unusually low figure of last month. Foreclosures, which in September reached the high est point in recent years, dropped seasonally in October; although smaller than a year ago, they were larger than in any other October in records dating back to 1919. Agriculture. In so far as crop pro duction is concerned, the agricultural situation this year compares favorably with the five-year average; yields per Per cent change from acre have been large and the quality of Contracts awarded in crops has not been impaired by ad selected cities and 1931 (000’s 1926-29 district verse weather conditions as was the omitted) 1930 aver age case last year. The marketing situa tion generally, however, has been un -69.4 Philadelphia.................. $ 48,454 -56.3 satisfactory, owing to a steady decline -44.9 2,940 + 4.9 Reading.......................... -71.0 1,092 -69.1 Scranton......................... in the wholesale price of farm prod 1,923 -39.0 -76.7 Camden.......................... -SO. 7 2,933 -11.4 ucts; since the beginning of the year Trenton.......................... 2,713 -43.2 -52.7 Wilmington................... this recession in the country amounted 91,140 -40.4 -47.5 “All other”.................... to about 20 per cent. -58.3 District, all cities......... 151,195 -46.3 Production estimates as of October 1 indicate that the yield of corn, Source: F. W. Dodge Corporation. spring wheat, tame hay, tobacco, and awards for other classes of construc white potatoes will be larger than the actual harvest of 1930, while the oats tion declined. The local real estate situation con crop is expected to be slightly smaller tinues unsatisfac tory. The supply Trend of farming in Pennsylvania of mortgage 1920 1930 (figures in thousands) 1910 1900 money is less than Rural population (farm and non it has been for a 3,112* 3,098* 3,034 farm) .................................................... 2,710 farms (or number of op long time and Number of................................................ 172 202 219 erators) 224 17,658 15,309 18,587 19,371 property owners I.and area in farms (acres)................. 575,393 630,430 726,158 529,696 Value of land in farms ($).................. with maturing Value of farm buildings ($)................ 322,880 410,639 600,594 673,321 mortgages are ex Value of farm implements ($)........... 50,917 70,726 163,826 154,756 periencing con Source: United States Census of Agriculture. siderable difficulty * In a decade from 1920 to 1930 farm population declined 10 per cent, while in refinancing. rural population not engaged directly in farming increased 4 per cent. district declined noticeably in Septem ber and was the smallest since March. The value of contracts awarded for new construction increased in Septem ber. Following a steady decline for five months, awards for residential buildings increased; gains also oc curred in contracts for public works and utilities, and factories, while those for commercial buildings showed losses-. In early October residential contracts increased further, while than that of last year. Dairy cattle measure up to their usual October 1 condition. Although sales of swine for slaughter have been somewhat less than a year ago, new hogs are reported as being in good marketable condi tion. Coal. The anthracite market remained quiet during the greater part of Sep tember, although cooler weather at the close of the month stimulated de mand and resulted in larger sales. Colliery output, which averaged about 174,000 tons daily, showed a gain of nearly 5 per cent over the rate of the preceding month. Output was 12 per cent smaller in the first nine months this year than last. Production as usual increased further in the first half of October, but remained smaller than in the corresponding period of 1930. Shipments last month also ex ceeded those of August. Average prices of anthracite coal in the coun try increased further and in Septem ber were 5.8 per cent higher than a year earlier. Demand for Pennsylvania bitumi nous coal remained rather unsatisfac tory, though prices show a little more strength; in comparison with a year ago prices in September were 6 per cent lower. Output of Pennsylvania collieries increased seasonally, but for the year to date production was 20 per cent smaller than last year. During the first fortnight of October, produc tion showed a further seasonal gain. September shipments increased and were the largest since February, re flecting some demand from industries. Distribution. Retail sales during September showed more than seasonal gains over August. Department, women’s apparel, shoe, and credit stores had larger business, while men’s apparel stores reported a small decline. All the leading city areas except Johnstown and Wilmington shared in this increase. In early October sales continued upward as usual. Compared with September 1930, dollar sales were 15 per cent smaller, all lines included in the accompanying table showing declines. Sales were 10 per cent smaller in the first nine months of this year than last, de creases ranging from 7 per cent in credit stores to 20 per cent in shoe stores. Inventories at retail establish ments increased as they usually do be tween August and September, but they remained 13 per cent smaller than in September 1930, reflecting partly lower prices. The rate of turnover continued higher this year than last. Retail prices of merchandise gen erally handled by department stores declined further, and on October 1 the average level was 12 per cent lower than at the beginning of the year, according to Fairchild’s in dex. The drop in the prices of in dividual items varied from one per cent for shoes to 22 per cent for luggage. Retail food prices in P h i 1 a d e 1 phia showed a decrease of one per cent, while in the country less than one per cent, from August to September; in Scranton food prices increased SALES OF LIFE INSURANCE NEW PAID-FOR ORDINARY INSURANCE 1923-25 AVG.= 100 PENNA. DEL. N.J. \ V, zy UNITE 3 STATES-—- v*' ADJUSTED F DR SEASONAL V ARIATI0NS w——...... 1928 1929 1930 1931 1932 Percentage change Retail trade Philadelphia Federal Reserve District September, 1931 Net sales: 1931, compared with 1930 Rate of turnover nine months Stocks: Sept. 30, 1931, compared with Sept. Nine months All reporting stores................. -14.7 - 9.7 -13.2 +12.3 2.67 2.79 Department.............................. in Philadelphia.................... outside Philadelphia.... Men’s apparel........................ in Philadelphia.................... outside Philadelphia........ Women’s apparel.................... in Philadelphia............. outside Philadelphia.......... Shoe............................ Credit..................................... -14.8 -16.1 -11.1 -13.8 -19.2 - 9.3 -14.1 -14.6 -10.2 -20.4 -11.3 - 9.6 -10.6 - 7.1 -14.1 -17.9 -10.8 - 8.4 - 8.4 - 7.8 -19.5 - 6.7 -12.7 -11.5 -15.1 -15.4 -20.6 -11.7 -16.9 -18.3 - 8.1 -17.2 -14.1 +12.2 +13.6 + 9.2 + 4.7 - 8.8 +15.3 +33.0 +37.2 +14.5 + 5.3 + 4.1 Wholesale trade Philadelphia Federal Reserve District September, 1931 (Percentage change is indicated by + and — signs) Net sales— Nine months 1931 compared with nine months 1930.................................... Sept., 1931, compared with: Aug., 1931........................ . Sept., 1930........................ Actual index:* Sept., 1931........................ Aug., 1931........................ Seasonally adjusted index :* Sept., 1931........................ Aug., 1931........................ Stocks—Sept. 30, 1931 Change from: Aug. 31, 1931.................. Sept. 30, 1930.................. Receivables—Sept. 30, 1931 Change from: Aug. 31, 1931.................. Sept. 30, 1930.................. Collections during Sept. 1931 Change from: Aug., 1931........................ Sept., 1930........................ Boots and shoes Drugs Dry goods Elec trical supplies Grocer ies Sept. 30, Aug. 31, 1930 1931 1930 1931 Hard ware 2.68 2.94 2.14 1.60 1.75 1.49 4.50 4.77 2.95 2.00 1.71 Jewelry 2.79 2 99 2.36 1 62 1.53 4.91 5.29 2.90 1.92 1.96 Paper -24.4 - 4.7 -16.9 -14.5 -13.0 — 18 8 —33 9 + 8.9 -27.7 + 9.6 - 7.2 +40.2 -19.7 - 1.1 -36.9 +21.2 - 6.6 + 18.3 -19.8 +31.5 -43.9 - 1.0 -22.6 65.1 59.8 90.1 102.4 93.4 110 4 54.1 38.6 67.4 61.3 62.0 101.3 83.6 108.5 65.3 55.2 81.4 58.9 44.8 105.0 69.0 69.7 89.1 45.2 52.9 62.6 99.4 100.4 107.2 40.7 41.5 50 7 51.1 75.6 91.3 85.3 97.7 62.2 62.0 77.5 47.5 50.0 84.7 67.6 73.4 87.4 - 0 2 - 4.5 + 5 3 -20 4 -15.1 -13.8 + 1.4 -26.4 + 2.6 - 9.6 + 9.1 -14.4 + 3.7 -17.8 + 4.2 - 7.9 + 2.6 -15.6 + 4.9 -25 3 + 0.9 — 9 3 +31 .8 + 6.2 + 0.2 - 2.2 + 54 -21.1 -10.7 -19.0 -22.9 -24.9 -22.7 - 1.5 * 1923-1925=100. Page Five one per cent in the same period. In comparison with a year ago, food prices were 14 per cent lower in Philadelphia and 16 per cent in Scranton, as contrasted with a decline of 18 per cent in the average for fifty-one cities of the United States. Wholesale trade increased from August to September, though by a smaller amount than usual. Sales of drugs, dry goods and hardware meas ured up to about the usual expecta tions, while the grocery trade showed more than the normal seasonal in crease. The gain in the shoe business was smaller than customary and sales of paper and electrical supplies de creased instead of increasing. Pre liminary returns for October indicate further seasonal gains. Partly because of lower prices, the dollar sales at wholesale were 17 per cent smaller than, in September 1930', the sharpest declines occurring in jewelry, electrical supplies, shoes, and paper. In the first nine months sales were 14 per cent smaller than in the like period last year. Along with other comparisons, changes in cumu lative sales of individual lines are given in the accompanying table. Stocks at wholesale establishments at the end of September remained notice ably smaller than a year ago. Re ceivables also were smaller, although, like sales, they showed gains in the month. Collections increased during September but were generally lower than a year ago. Freight car loadings in this section declined by less than the usual sea sonal amount. The drop in the load ings of merchandise and miscellaneous commodities, comprising chiefly fin ished and semi-manufactured goods, has been almost continuous since 1929. Total loadings remained 21 per cent smaller in the first nine months this year than last. Sales of new passenger automobiles declined further in September, though by a smaller percentage than is cus tomary. In the first nine months reg istrations of new cars were 7 per cent smaller than in the same period last year. Financial conditions. During the four weeks ended October 21, deposits of the reporting member banks in four of the larger cities of the district de clined from 1,148 to 1,034 millions. The greater part of the decline was in net demand and time deposits and re flected a demand for currency, the Page Six withdrawal of a part of the funds held on deposit for other banks, and the re payment of loans. Calls by the Treas ury for part payment on securities allotted to the banks in September also caused a reduction of 22 millions in government deposits. To provide these funds, the banks borrowed more heav ily from the Federal Reserve Bank, but they also reduced their loans to the open market from 32 to 24 millions and disposed of 38 millions of United States securities and 21 millions of other securities. Loans to customers declined 15 millions. The records of this bank reveal that the total excess of currency payments over receipts during the four-week period amounted to 90 millions; nearly 50 millions of this was paid out in the first week of October and the most re cent data show a marked decline in the demand for cash. In meeting this demand and Treasury calls for pay ment on securities, the banks increased their borrowings at this bank from 45 to 98 millions, the highest figure shown in any weekly statement since 1929 ; 40 millions of the increase rep resented added accommodation granted to banks in Philadelphia and the bal ance was rather widely distributed throughout the district. This bank also extended about 6 millions of ad ditional credit through the local pur chase of securities and bills. Despite the increased use of reserve bank credit and a favorable balance of 42 millions in the settlements with other districts, which doubtless was due largely to the sale of securities, the reserve deposits of member banks deFederal Reserve Philadelphia (Dollar figures in millions) Changes in—• Oct. 21, 1931 Bills discounted for banks in Philadelphia. . . s 58.6 Twenty other large cities.. . 21.2 Other comm unities.................. 18.4 Total bills discounted......... $ 08.2 Bills bought.......... 14.7 United States securities.......... 57.9 Other securities . . 6.8 Four weeks One year +130.7 +$ 56.2. + + -1- 8.3 5.0 -f- 13.0 10.2 +$53.0 + 5.6 +* 70.4 + 13.7 + + + + 1 .6 5.5 5.7 5.7 Total bills and $177 6 Fed. res. note circulation......... 260.6 Member bank reserve deposits 131.6 Foreign bank deposits............. 16.5 Cash reserves.... 264.9 64.5% Reserve ratio........ +$65.7 +$104.5 + 93.7 + 145.6 - - 4.9 + + 2.5 + + 20.9 - 12.1% - 10.1 16.0 46.6 19.9% L0ANS AND INVESTMENTS A Li. MEMBER BANKS Philadelphia Federal Reserve District Dollars 1928 clined 5 millions. The reserve ratio decreased from 76.6 per cent on Sep tember 23 to 64.5 per cent on October 21, but on the latter date was exceeded by only two of the other reserve banks. A preliminary tabulation from call reports shows that the total loans and investments of all member banks in the district on September 29 amounted to 2,739 millions, slightly larger than a year earlier. The component items show substantial changes. Loans to customers other than banks decreased from 1,671 to 1,535 millions and loans to the open market from 116 to 36 millions, while loans to banks increased All member banks Philadelphia Federal Reserve District (000,000’s omitted) Sept. 24, June 30, Sept. 29, 1930 1931* 1931 Loans to banks............. $ Loans to other custom ers: On stocks and bonds Real estate loans . . . All other..................... Loans to open-market: Bought acceptances and commercial paper...................... Loans on securities to N. Y. brokers.... Investments: U. S. securities......... Other securities........ 27 * 49 $ 47 679 240 752 614 243 711 599 242 694 67 41 32 49 16 4 196 727 347 767 366 755 Total loans and in vestments ......... $2,737 $2,788 $2,739 * Preliminary. from 27 to 47 millions and investments from 923 to 1,121 millions. Real es tate loans have changed little over the past year and a half, and on September 29 constituted less than 9 per cent of the total loans and investments. Although the renewal rate on bro- kers’ loans in Philadelphia continues at 4 per cent, unchanged since May 1930, the latest reports show a small increase in average rates charged by large Philadelphia member banks on prime commercial loans to customers. The discount rate of this bank was raised from 3 per cent, the rate in effect since May 7, to iy2 per cent, effective (De tober 22. Sales of cornmercial paper, as reported by four dealers, amounted to only $595,000 in September, as compared with more than 5 mil lions in the pre- City banks 1931—June... $1,730,000 #1,075,000 $2,806,000 July. . . 5,877,500 1.602.500 7.480.000 Aug---- 2.635.000 2.494.500 Sept_ _ 60,000 535,000 5,696’ooo 1930—Sept.... 1929—Sept.... 4.685.000 2.767.500 _ 62,500 1.127.500 7,452,600 1.190.000 800 NET DEMAND DEPOSITS TIME DEPOSITS 1928 1930 Average first four Wednesdays Percentage change—Sept., 1931, from Sept., 1930 City areas* Employ ment Allentown................ Altoona.................. Harrisburg.............. Johnstown............... Lancaster................ Philadelphia........... Reading................... Scranton.................. Trenton.................... Wilkes-Barre.......... Williamsport........... Wilmington............. Y ork......................... -22.9 - 1.4 -28.7 -49.5 - 2.1 -15.5 -12.6 -13.2 -10.8 - 0.4 -10.8 -17.2 -14.2 Wage payments -41.1 -24.8 -38.4 -51.8 - 2.1 -27.2 -29.2 -14.1 -27.4 -15.4 -27.1 -29.6 -27.4 Building permits (value) _ + _ _ + _ _ 62.8 28.9 527.9 58.0 19.6 79.6 55.0 39.8 71.8 66.7 81 2 58.1 Debits Retail trade sales + 3.0 + 3.5 - 0.9 -21.6 + 2.9 0.0 - 2.2 + 5.6 - 0.5 + 6.8 + 0.5 - 1.2 + 0.2 - 1.7 - 8.9 + 4.0 -25.2 + 4.1 - 5.4 - 4.1 + 1.8 -12.6 +11.9 + 1.5 - 6.8 — 5.2 —13.7 -14.6 -13.7 -10.8 38.0 + 56.7 +1373.2 — 94.2 + 168.7 53.4 + 23.6 14.0 + 20.2 + 105.5 51.1 1.2 _ + 107.5 + + + + + 0.5 2.1 1.3 1.9 0.4 8.0 +23.5 - 0.4 + 9.9 +13 7 +20.8 +11.0 * Area not restricted to the corporate limits of cities given here. index * Sept., 19*30 1931 - 4.4 All manufacturing industries (51)....................................... 72.7 -16.9 - 0.3 53.7 -34.0 Metal products........................ 65.6 Blast furnaces...................... 38.8 Steel wks. and rolling mills 55.9 Iron and steel forgings.... 64.9 Structural iron work.......... 93.9 Steam & hot wtr. htg. app. 85.8 Stoves and furnaces........... 64.7 Foundries.............................. 60.4 Machinery and parts......... 74.6 Electrical apparatus........... 100.4 Engines and pumps.............. 49.5 Hardware and tools............. 68.0 Brass and bronze products 62.6 -24.4 - 1.5 44.2 -45.2 - 7.3 -26.2 -27.0 -26.1 -20.2 -13.5 -17.8 -27.1 -19.4 -19.3 -36.1 -17.2 -22.7 + - 27.4 36.3 42.5 64.2 56.2 48.2 33.8 46.5 79.4 33.2 46.5 48.3 -46.7 -48.8 -45.7 -38.3 -38.2 -32.7 -50.3 -38.4 -40.2 -52.1 -30.6 -34.0 - 3.5 - 6.7 -11.8 -15.7 - 6.0 +24.5 -10.3 - 8.3 — 7.1 + 0.9 —11 1 - 2.2 44. Of -35.4 - 2.4 30.5t -50.S 52.6 49.1 23.5 60.1 40.7 + 8.2 -22.9 -45.6 -16.9 -57.9 + 2.5 -12.0 + 2.2 -10.3 + 8.0 20.4 52.3 16.6 39.2 33.6 -35.2 + 5.4 -58.5 -41.9 -77.4 + 1.0 + 1.5 85.6 - 5.9 + 2.8 62.9 63.1 88.2 88.3 64.5 73.7 99.0 91.0 83.3 104.3 150.2 + 4.3 + + 4.0 + - 4.4 + - 5.1 + +11.4 + -24.5 -12.8 -11.5 + + 2.8 + - 0.9 +ii.i + 106.3 105.3 107.1 106.8 93.9 103.4 + - 56.6 -14.5 - 1.2 38.6 -30.7 - 2.8 66.2 49.5 57.6 -16.5 -18.9 - 6.2 - 6.8 - 8.3 +22.8 40.0 35.5 45.6 -36.2 -35.6 -13.0 - 7.8 -11.5 +26.0 Lumber products............ 61.0 Lumber and planing mills. . 34.1 Furniture...................... 73.5 Wooden boxes............. 63.2 -19.4 + + + + 0.7 58.3 -17.5 0.9 0.5 1.0 27.7 73.2 60.1 -49.4 - 6.3 - 8.0 + 1.0 -13.o + 3-o Chemical products......... Chemicals and drugs. Coke............................... Explosives.................... Paints and varnishes. Petroleum refining. . . 2.9 3.9 1.6 0.7 1.7 4.8 -49.6 - 2.1 -14.8 + + + + 0.5 2.4 1.1 4.2 0.0 3.4 4.1 1.8 1.3 7.4 4.1 0.6 +11.8 + 5.1 -25.9 - 0.9 70.3 -15.3 - 2.5 2.4 50.9 4.1 52.1 7.3 85.6 4.5 79.2 0.3 52.7 3.0 54.7 1.6 75.9 5.2 78.1 1.0 74.5 3.1 83.7 7.3 123.4 - 9.3 -12.3 - 5.0 -13.1 +21.4 -25.1 -29.0 -23.8 - 3.0 -20.5 + 0.5 -15.3 -12.7 + 6.7 + 2.5 93.6 + 0.8 95.9 +13.3 97.6 - 9.4 105.3 + i.i 79.0 + 0.6 83.2 -10.2 + 1.8 + 0.5 -11.4 - 1.0 - 5.0 -14.1 -14.1 - 2.8 - 0.6 + 0.7 + + — - 6.1 5.7 3.6 3.7 4.9 +22.8 - 5.7 + 0.1 - 5.2 +11.7 —12.4 — 6 7 — 16 0 -12.7 — 8 7 — 10.7 +12.5 +13.9 +34.7 - 9.0 + 8.8 +30.0 + 2.5 +28.6 +10.6 +20.4 - 8.2 85.2 - 7.1 - 2.7 74.6 -20.9 64.8 58.8 76.4 86.9 124.3 - 5.3 -30.8 - 2.4 - 2.S + 0.8 + + - 3.3 60.6 9.7 32.4 2.8 80.2 0.6 76.6 2.5 116.0 - 8.2 -58.9 -16.0 -10.3 -10.3 Leather and rubber products . 97.0 Leather tanning.................... 101.8 Shoes......................................... 100.2 Leather products, other... . 82.8 Rubber tires and goods.... 87.5 + + - 3.3 + + - 0.1 89.2 0.9 2.8 2.5 2.6 93.0 86.7 78.2 94.9 -14.4 -18.1 -11.9 - 8.2 - 1.5 Paper and printing............... Paper and wood pulp. . . . Paper boxes and bags.. . . Printing and publishing.. -19.1 —25.1 -19.5 —20.3 — 14.5 -13.1 — 19.2 + 3.8 + 7.2 + 2.8 September, 1931, from August, 1931 Allentown................ Altoona.................... Harrisburg.............. Johnstown............... Lancaster................ Philadelphia........... Reading................... Scranton.................. Trenton................... Wilkes-Barre.......... Williamsport.......... Wilmington............. York......................... Aug., 1931 Stone, clay and glass products Brick, tile and pottery Cement. Glass... . REPORTING MEMBER BANKS----- PHILADELPHIA DISTRICT 1927 Sept., 1930 Per cent change since Transportation equipment... . Automobiles........................... Auto, bodies and parts........ Locomotives .and cars.......... Railroad repair shops........... Shipbuilding........................... cT/'T September sales were the smallest for any month in j , . records reaching back to 1923. DEPOSITS MILLIONS DOLLARS Per cent change since Sept. index * Foods and tobacco.................... Bread and bakery products Confectionery........................ Ice cream................................. Meat packing......................... Cigars and tobacco............... sales Country banks Employment and wages in Pennsylvania Payrolls September, 1931 Textile products...................... Cotton goods........................ Woolens and worsteds .... Silk goods.............................. Textile dyeing and finishing Carpets and rugs................. Hats........................................ Hosiery................................... Knit goods, other................ Men’s clothing..................... Women’s clothing............... Shirts and furnishings.... Sales to— Commercial paper sales (four dealers) Employment September, 1931 - 6.5 + + + 1.0 86.9 -15.3 78.3 83.2 96.9 2.7 9.0 1.8 60.3 81.8 98.4 -23.6 -17.6 -11.0 + 5.2 Anthracite.................................... 77.8 -15.3 +18.8 55.0 -29.7 +15.1 91.0 8.9 4.3 5.7 0.2 5.8 8.9 5.4 Bituminous coal......................... - 8.7 + 3.8 -12.0 - 9.8 + 0.1 -11.0 - 5.0 - 4.3 - 3.6 - 6.1 -10.9 + 1.2 -11.2 + 7.9 + 0.2 Construction and contracting. 78.3 -25.9 - 7.8 59.5 -32.9 - 4.2 Street railways........................... 77.3 - 6.1 + 0.3 71.8 -15.3 - 4.5 Retail trade................................. 89.8 - 7.4 + 6.8 Wholesale trade........................ 90.1 - 1.1 + 0.1 * 1923-1925 average = 100. f Preliminary figures. Page Seven Synopsis of Industrial and Trade Conditions in the Philadelphia Federal Reserve District Demand Operations Stocks Manufacturing Iron and steel Declined Slow Steel works and rolling Some gain Quiet Foundries and machine Quiet, some orders Electrical apparatus Quiet ............... gain in unfilled Production of steel castings dedined; output of iron castings increased Declined Transportation equipment Quiet Increased Slow Declined Fair, some gain Increased Textiles Quiet, declined Smaller than a year ago Smaller than a year ago Fair, little change; prices lower Declined Moderate, declined Fair, increased; prices firmer Declined Declined, smaller than a year ago Quiet, some gain Little change Smaller than a year ago More active; prices lower Increased Moderate, smaller than a year ago Fair, increased Increased Declined Quiet, declined; prices lower Increased slightly Smaller than a year ago Quiet Little change Little change Declined Little change Slow, little change Declined Declined Quiet, little change Declined less than usual Some decline but larger than a year ago Slow Declined Declined Fair Some gain Declined, smaller than a year ago Quiet Declined Moderate, little change Slow, some decline Declined Little change Quiet, little change Declined sharply Little change Fair, increased Some gain Smaller than a year ago Little change Increased Smaller than a year ago Slow, little change Little change Little change Leather products kid.................................... Quiet; prices lower Building materials Miscellaneous Contract awards increased in September; permits declined Declined seasonally Building Coal mining Some gain; prices higher Increased Little change; prices firmer Increased Trade Retail .................................................... Increased . Wholesale and jobbing. . . . Page Eight More active in October Increased seasonally but smaller than a year ago Smaller than a year ago
@FedFRASER